The Obama administration is seeking to toss out a pair of high-profile healthcare lawsuits in which insurers claim they are owed millions of dollars under the Affordable Care Act. The two insurers, Moda Healthcare and BlueCross BlueShield of North Carolina, have sued the federal government over a combined $338 million in ObamaCare payments they argue are overdue.
http://origin-nyi.thehill.com/policy/he ... e-lawsuits
The Justice Department filed motions to dismiss both lawsuits on Friday, arguing that the federal government isn’t responsible for those payments at all. That argument — which goes further than the department’s move to dismiss a similar case in June — could have a major ripple effect throughout the marketplace. Tim Jost, a health policy professor and long-time observer of the Affordable Care Act, said the federal government is now digging in on the merits of the cases for the first time. "It seems to me that HHS is clearly changing its position in these cases," Jost said Monday. "The motions filed in both of these cases is a full-throated repudiation of any obligation [of the payments." [...]
Moda argues it is owed $191 million from 2014 and BlueCross BlueShield says it is owed $147 million. The Obama administration has not yet released payment data from the 2015 year, though it plans to do so in December 2016, according to the filing. In their new documents, Justice officials argued that the Department of Health and Human Services (HHS) does not owe that money to insurance companies, in part because Congress has “directly spoken” about its intent to limit the use of federal dollars into the program. “Under Moda’s interpretation, HHS would be the uncapped insurer of the insurance industry itself,” the Justice Department wrote. “Congress did not intend that result.”
From February 2016 (FWIW Moda's a mid sized regional insurer, not a co-op):
State regulators have agreed to lift their restrictions on Moda Health Plan selling and renewing policies while the troubled health insurer and its parent company sell assets and take other steps to shore up its depleted capital reserves.
http://www.oregonlive.com/business/inde ... nt_on.html
The Oregon Department of Consumer and Business Services said it reached an agreement under which the insurer and its parent company, Moda Inc., would inject $170 million in new capital into the insurance company. The plan is for Moda and its parent company to sell a portion of their accounts receivable from the federal government to a third party, for its parent company to sell other, unspecified assets, and to borrow more money by issuing "surplus notes."
I don't have to guess what all this is going to do to insurance rates.