A federal judge dealt a major blow to a health insurer’s attempt to recoup millions of dollars it says it is owed under an Affordable Care Act program designed to incentivize insurer participation in the ACA public exchange program.
Judge Lydia Kay Griggsby of the U.S. Court of Federal Claims in Washington, on Tuesday rejected a lawsuit brought last June by Blue Cross and Blue Shield of North Carolina. The company had accused the U.S. Department of Health and Human Services of failing to make good on its obligation to pay nearly $130 million under the ACA risk corridors program.
The opinion further widens the divide among Claims Court rulings addressing the issue of the federal government’s nonpayment of risk corridor funds.
North Carolina Blue did not answer emailed requests for comment on the ruling Wednesday afternoon.
The ACA risk corridor program was established during the Obama administration to ease insurers — worried about potential losses they might suffer from insuring previously uninsured Americans — into selling coverage through the exchange system. The idea was to use money from insurers that did well on the exchanges in 2014, 2015 and 2016 to help insurers that did poorly.
In October 2015, HHS officials announced that the program had taken in only enough cash from exchange plan insurers that did well in 2014 and 2015 to pay about 16% of the amounts owed to the struggling insurers for 2014. The program has not paid anything to struggling insurers for 2015.
Griggsby agreed with HHS regulators that neither the ACA nor the regulations implementing the government’s obligation to make risk corridor payments under the statute requires HHS to make full risk corridor payments on an annual basis.