State AGs poised to en­ter fight over ACA in­sur­ance sub­si­dies

Modern Healthcare - - NEWS - By Shelby Liv­ingston

Yet an­other fac­tion is about to join the on­go­ing bat­tle over cost-shar­ing re­duc­tion pay­ments.

A fed­eral ap­peals court last week granted state at­tor­neys gen­eral the abil­ity to de­fend the Af­ford­able Care Act sub­si­dies in a le­gal case over whether the fed­eral gov­ern­ment must keep mak­ing the pay­ments.

A three-judge panel for the U.S. Court of Ap­peals for the Dis­trict of Co­lum­bia Cir­cuit held that 16 at­tor­neys gen­eral may in­ter­vene in House v. Price be­cause they showed a “sub­stan­tial risk” that ter­mi­nat­ing the cost-shar­ing re­duc­tion pay­ments, or CSRs, would “di­rectly and im­mi­nently” cause in­sur­ance pre­mium hikes and lead to more peo­ple be­com­ing unin­sured.

The ap­pel­late court’s or­der is a ma­jor de­vel­op­ment in the case, which started dur­ing the Obama ad­min­is­tra­tion. Pres­i­dent Don­ald Trump has re­peat­edly threat­ened to end the CSRs, la­bel­ing them in­surer “bailouts.”

The de­ci­sion stemmed from a mo­tion the at­tor­neys gen­eral—from both Repub­li­can- and Demo­cratic-led states— filed in May seek­ing per­mis­sion to get in­volved in the case. The law­suit was orig­i­nally brought by House Re­pub­li­cans to block fed­eral pay­ment to in­sur­ers to fund the Af­ford­able Care Act’s cost-shar­ing re­duc­tion sub­si­dies for low-in­come ex­change plan mem­bers.

A U.S. Dis­trict Court judge in May 2016 agreed with House Re­pub­li­cans that the Obama ad­mi­nis- tra­tion had been il­le­gally fund­ing the pay­ments with­out con­gres­sional ap­pro­pri­a­tions. The Obama ad­min­is­tra­tion ap­pealed the rul­ing. Now the case is on hold in the D.C. Cir­cuit.

The ap­pel­late court or­der means the Trump ad­min­is­tra­tion can­not uni­lat­er­ally stop the CSR pay­ments and dis­miss the ap­peal, ac­cord­ing to Tim­o­thy Jost, emer­i­tus pro­fes­sor at the Wash­ing­ton and Lee Univer­sity School of Law and an ex­pert on health­care re­form.

“If the ad­min­is­tra­tion does stop mak­ing the pay­ments, the states—or in­sur­ers, or pos­si­bly con­sumers—would be able to sue to re­quire the pay­ments to be made and the in­junc­tion en­tered by the lower court would not be as much of a road­block to their pre­vail­ing,” he wrote in Health Af­fairs.

The pay­ments are viewed by many as crit­i­cal to sta­bi­liz­ing the Oba­macare ex­changes. A coali­tion in- clud­ing Amer­ica’s Health In­sur­ance Plans, the Amer­i­can Hos­pi­tal As­so­ci­a­tion, the Amer­i­can Med­i­cal As­so­ci­a­tion, the Fed­er­a­tion of Amer­i­can Hos­pi­tals, and U.S. Cham­ber of Com­merce last week urged the Trump ad­min­is­tra­tion to con­tinue fund­ing the CSRs.

“With­out th­ese funds, con­sumers’ ac­cess to care is jeop­ar­dized, their premi­ums will in­crease dra­mat­i­cally, and they will be left with even fewer cov­er­age op­tions,” the groups said in a joint state­ment. “As med­i­cal pro­fes­sion­als, in­sur­ers pro­vid­ing health care ser­vices and cov­er­age to hun­dreds of mil­lions of Amer­i­cans, and busi­ness lead­ers con­cerned with main­tain­ing a sta­ble health in­sur­ance mar­ket­place for con­sumers, we be­lieve it is im­per­a­tive that the ad­min­is­tra­tion fund the cost-shar­ing re­duc­tion pro­gram.”

An AHIP spokesper­son said the as­so­ci­a­tion did not have a com­ment on the ap­peals court rul­ing.

The Trump ad­min­is­tra­tion has been pay­ing the sub­si­dies on a month-by-month ba­sis. But Trump has threat­ened to quit fund­ing them as a way to pres­sure Congress to pass a health­care bill.

“The court’s de­ci­sion is good news for the hun­dreds of thou­sands of New York fam­i­lies that rely on th­ese sub­si­dies for their health­care,” New York At­tor­ney Gen­eral Eric Sch­nei­der­man said in a state­ment. “It’s dis­turbingly clear that Pres­i­dent Trump and his ad­min­is­tra­tion are will­ing to treat them as po­lit­i­cal pawns; but this coali­tion of at­tor­neys gen­eral stands ready to de­fend th­ese vi­tal sub­si­dies and the qual­ity, af­ford­able health­care they en­sure for mil­lions of fam­i­lies across the coun­try.”

Source: U.S. Court of Ap­peals for Dis­trict of Co­lum­bia

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