The Obama Administration is now trying hard to pay health insurers billions of dollars that the Federal government owes under ACA. This is planned through a move that may circumvent Congress and help improve the signature legislative achievement of the President before he leaves his office.
The Department of Justice officials privately told health plans, which are suing over this unpaid money, that they need to negotiate a broad settlement. This settlement could result in offering payments to almost 175 health plans that are selling insurance coverage on Affordable Care Act markets.
It is said that the payment is drawn from an obscure Treasury Department fund that is intended to cover the federal legal claims. It is believed that this approach can help get around a recent congressional ban on making use of Health and Human Services’ money to pay insurers.
The start of the negotiations was in the middle of numerous health plans from insurance exchanges and statistics shows that more than ten million Americans gained insurance coverage since the opening of marketplaces in 2014. However, many of the insurers are now losing money on new users, who are relatively sick and expensive. For this reason, some smaller plans have been designed and some of the major plans are defecting from exchange.
The efforts of the administration reflect partisan thorns that surround the law. The officials want to save payouts that were part of ACA strategy to help markets flourish early on. However, a settlement would rely on the Judgment Fund of the Treasury.
The Judgment Fund is a 1950’s creation allowed to have as much as money it needs to satisfy the claims against the government that are valid. This will total to about eighteen million dollars.
In the waning months of administration, officials are continuing their upbeat portrayal. They believe that making these payments to insurers is much important to the wellbeing of exchanges. “It’s a legacy item for the White House,” Dan Mendelson, president of the health consulting firm, Avalere said. “It’s more than just a lawsuit. It’s really about the future. . . and stability of these markets.”
On the other hand, GOP lawmakers have begun cries of foul. “It’s an end run on the clear. . . intent of Congress,” said Rep. H. Morgan Griffith. With all these allegations and oppositions, it is not sure that the Obama Administration will be able to make use of the funds as they are planning.