The Centers for Medicare & Medicaid Services (CMS) is getting ready to bill health insurers for hundreds of millions of dollars, or even billions of dollars, in Patient Protection and Affordable Care Act (PPACA) program “payables.”
The bills could force health insurers that have big payables and are short on cash to scramble for money to send to CMS, which is part of the U.S. Department of Health and Human Services (HHS). In theory, it’s possible that a scramble for cash could affect some insurers’ ability to pay claims, or to pay agents’ and brokers’ commissions.
It’s not clear how big the bills will really be. CMS officials say in a slidedeck describing the PPACA payment and collection process that it will process payables and receivables for many different PPACA programs that affect health insurers, including the PPACA advanced premium tax credit (APTC) subsidy program, the PPACA cost-sharing reduction (CSR) subsidy program, the PPACA risk-adjustment program, and the PPACA reinsurance program.
See also: Feds post PPACA lifeboat program numbers
Analysts at Standard &Poor’s Ratings Services reported earlier this week, for example, that they believe the risk-adjustment program alone could lead to $2.3 billion in insurer-to-insurer cash transfers.