Insurers seeking reimbursement under ACA denied hearing by Supreme Court
The decision deals a blow to insurers looking to recoup payments they believe they are owed by the federal government.
The U.S. Supreme Court on Monday declined to hear arguments from three insurance companies seeking reimbursement under the Affordable Care Act. As a result, lower courts will decide the issue.
Maine Community Health Options, Community Health Choice and Common Ground Healthcare Cooperative had sought help from the high court to receive the reimbursements, some of which go back years. The insurers said they collectively were owed millions of dollars for each year they did not receive payments the government had pledged to make under the ACA. The court did not give a reason for not taking up the case, but the decision deals a blow to insurers looking to recoup payments they believe they are owed by the federal government.
Related: DOJ urges Supreme Court to reject health insurers’ $12B risk-corridor payment challenge
The Supreme Court had previously ruled in April 2020 that the federal government had to fully repay insurers for risk-corridor payments under the ACA. The court ruled insurers were entitled to more than $12 billion in unpaid payments. The risk corridor program ran from 2014 to 2016. It guaranteed payments to ACA exchange insurers that recorded certain losses. The goal was to help insurers navigate the new exchanges that went online in 2014.
However, the needed payments increased as the initial population on the ACA’s exchanges was sicker than usual and plans were priced too low. A few months later, in August, the Court of Appeals for the Federal Circuit decided that the Supreme Court ruling meant payments were mandatory, too.
The court ruled that plans that engaged in the practice of “silver loading” were not entitled to full payments. Plans employed silver loading, where they added the amount of cost-sharing reductions to the second-cheapest silver plan, which also is the benchmark plan that the to which the federal government pegs subsidies. The result of silver loading was that subsidies went up, because the benchmark plan’s cost increased.
This was the second ACA-related ruling in the past week. The high court in a 7-2 decision last Thursday rejected a Republican challenge to the law, the third time that the justices preserved the ACA over the past decade.
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