One of the biggest health insurers in the country, Blue Cross and Blue Shield of North Carolina, has filed a brief telling the U.S. Court of Appeals for the Federal Circuit why it thinks the government should make billions of dollars in Affordable Care Act risk corridors program payments to health insurers.
North Carolina Blue argues in the brief that the government created an “implied in fact contract” with health insurers for the program; that top U.S. Department of Health and Human Services (HHS) officials made statements binding the federal government to make program payments; and that Congress has left the laws requiring the government to make the program payments intact, and simply added narrow funding source restrictions to an appropriations bill.
“If Congress can eliminate an ‘unequivocal obligation’ of the government by slipping a spending limitation into an appropriations bill, and then later asserting in litigation that the limitation substantively revised an earlier-enacted statute, nobody dealing with the government — in any industry — could confidently rely upon even an explicit statutory promise,” the company says. “That would, in turn, send ripple effects throughout the national economy.”
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A judge told North Carolina Blue in April that ACA risk corridors program managers have no obligation to make program payments on an annual basis, and that its dispute with the program is not yet ready for action.
Judges in some other, similar cases have sided with the insurers. Molina Healthcare Inc. recently won an award for $52 million in risk corridors program payments.
Lawrence Sher, a partner at Reed Smith, is the lead attorney for both Molina and for North Carolina Blue.
ACA Risk Corridors Program
The ACA created a new system of public health insurance exchange programs, or web-based health insurance supermarkets.