Administration takes another swipe at ‘Obamacare’

WASHINGTON – The Trump administration is freezing payments under an “Obamacare” program that protects insurers with sicker patients from financial losses, a move expected to add to premium increases next year.

At stake are billions in payments to insurers with sicker customers. The latest administration action could disrupt the Affordable Care Act, the health care law that has withstood President Donald Trump’s efforts to completely repeal it.

In a weekend announcement, the Centers for Medicare and Medicaid Services said the administration is acting because of conflicting court ruling in lawsuits filed by some smaller insurers who question whether they are being fairly treated.

The so-called risk adjustment program takes payments from insurers with healthier customers and redistributes that money to companies with sicker enrollees. Payments for 2017 were $10.4 billion. No taxpayer subsidies are involved.

The idea behind the program is to remove the financial incentive for insurers to “cherry pick” healthier customers. The government uses a similar approach with Medicare private insurance plans and the Medicare prescription drug benefit.

Major insurer groups said Saturday that the administration’s action interferes with a program that’s working well.

The Blue Cross Blue Shield Association, whose members are a mainstay of Affordable Care Act coverage, said it was “extremely disappointed” with the administration’s action.

The Trump administration’s move “will significantly increase 2019 premiums for millions of individuals and small-business owners and could result in far fewer health plan choices,” association president Scott Serota said in a statement.