Highmark's risk corridor litigation: Other insurers could follow suit

After Highmark sued the federal government for $224 million in unreimbursed losses from its Affordable Care Act policies, there are signs other insurers may consider filing similar suits.

David Holmberg, president and CEO of the Highmark tells the Pittsburgh Post-Gazette that leaders from other insurance companies have contacted him about the suit as they weigh their own options. 

For Highmark's part, the company decided to take legal action because it "saw no path forward" to recoup significant losses under the ACA's risk corridor program, Holmberg said. The insurer expects the government to owe it another $500 million by July, as its ACA customers have incurred high medical claims costs.

The risk corridor program was created to compensate insurers that took in new high-risk beneficiaries that entered the marketplace. However, the program paid out just 12.6 percent of what it owed insurers, leading the Centers for Medicare & Medicaid Services to explore other sources of funding.

Part of the blame for the program's funding shortfall can be assigned to Sen. Marco Rubio, R-Fla., who during his recent presidential campaign has touted his efforts to hamstring the program, notes a Post-Gazette editorial.

Holmberg wants the ACA to work, the editorial argues, but the government must also hold up its end of the bargain. "Forcing it to meet contractual obligations is part of that process," it says.

To learn more:
-read the Post-Gazette article
-read the editorial
 
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