Blue Cross Blue Shield of North Carolina--one of several insurers to sue over risk corridor payment shortfalls--has fired back at the government’s attempt to dismiss its claim.
BCBSNC is seeking $147 million to recoup risk corridor payments following significant shortfalls in the Affordable Care Act-created program. Other insurers that have sued to recoup payments include Highmark, Land of Lincoln Health, Health Republic of Oregon and Blue Cross of Idaho.
A Centers for Medicare & Medicaid Services memo in September indicated the Justice Department will “vigorously” defend against the suits, but also controversially added that CMS is "open to discussing resolution of those claims.”
By early October, the government had filed a motion to dismiss suits from both Moda Health and BCBSNC, arguing that not only does the Department of Health and Human Services not owe any insurer final payment before the end of the three-year risk corridor program, but it also is under no obligation to pay insurers beyond what it takes in collections.
In a newly filed brief (.pdf) replying to that motion, BCBSNC argues that HHS’ claim that payments owed to insurers are not payable in full until sometime after 2017, rather than every year, “is not supported by the statutory text or purpose of the ACA.” In fact, the government has already paid BCBSNC a little more than $18 million of the $147 million it owes the insurer, the brief says.
Further, it says the government’s motion to dismiss “engages in revisionist history” by relying on the claim that the risk corridor program can’t pay out more than it collects, saying the program was not originally intended to be budget-neutral. Indeed, GOP lawmakers tucked that provision into an omnibus spending bill in 2014.
In other ACA litigation-related news, House Democrats filed a brief (.pdf) in defense of the Obama administration in the ongoing legal fight over the legality of cost-sharing subsidies. The administration has already filed its first brief in its appeal of a federal judge’s ruling in favor of the plaintiffs--House Republicans.
In their brief, Democratic lawmakers make a similar argument, saying the subject of subsidy appropriation is a “dispute that should be addressed through traditional legislative processes, not the courts.” In addition, contrary to Republicans’ claims, “the executive branch was acting lawfully when it reimbursed insurers for cost-sharing reductions, as the ACA expressly required it to do,” the brief says.