The shots Congressional Republicans are taking at the Patient Protection and Affordable Care Act are starting to hit an unintended target—carriers.
The latest rift between the GOP and industry executives tore open over the party's attack on subsidies to some carriers doing business on the public exchanges. The federal subsidies, known as risk corridors, are designed to offset the risk of participation in the largely unknown public exchange marketplace. While some insurers have profited nicely from exchange business, others haven't done as well as they'd hoped. These companies are in line for the subsidies.
But, as reported in The Hill, the GOP has a special enmity for these subsidies. Perhaps the party's feelings toward them were best summed up by Florida's Sen. Marco Rubio, who's branded them "bailouts."
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The GOP is pushing legislation that would limit the amount the government can funnel into the risk corridor budget. Funds come from assessments paid by insurers that do better than anticipated with exchange business.
America's Health Insurance Plans took aim at the GOP initiative in October, when Rubio and others called upon House Speaker John Boehner, R-Ohio, to block new legislation that would add to risk corridor coffers.
"Eliminating this market-stabilizing tool—one used by both parties in the past—could mean higher premiums, which is the last thing consumers are looking for right now," AHIP spokesperson Brendan Buck said at the time.
Now, according to The Hill, as legislation to block further funding has become a reality, AHIP and others in the industry are stepping up their opposition.
"American budgets are already strained by health care costs, and this change will lead to higher premiums for consumers and make it more difficult to achieve affordability," AHIP spokeswoman Clare Krusing said. "Our focus should be on changes to the law that will lower costs — like repealing the health insurance tax — not those that drive premiums higher."
A Rubio spokesman noted that the legislation wouldn't end the subsidies, just curtail further funding.
"While the administration will still be able to administer the risk corridor program, at least now they must to do it in a budget-neutral fashion, as opposed to unlawfully providing for a taxpayer bailout," Alex Conant said.
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Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
