The agency once again defended the decrease by saying that navigators, which usually hail from non-profit and community organizations, are not effective. Back in February, a federal judge partially agreed with the insurer and barred the government from making further collections or payments using its current formula. In January a federal court in MA ruled the formula wasn't arbitrary and capricious.
A federal court ruling in New Mexico found the administration did not properly justify its formula for dispensing the funds.
Many carriers have already filed preliminary rate requests with state regulators - with some asking for double-digit hikes to shield themselves from other actions the administration and Congress have taken.
The ambiguity involved in the conflicting New Mexico and MA rulings may mean the suspension of payments will indeed be temporary.
Bright and Oscar both said that despite the move, they're going ahead with their expansion plans. "There was initial panic after the announcement, but the technical problems can be worked out".
Nonetheless, the timing is problematic.
A former CMC head during the Obama government, Andy Slavitt, indicated on Twitter that because in the long-run there will be the eventual payment of the finances, no insurers need to pull-out from the markets or act out of context or feat at the moment.
Judge orders Paul Manafort moved to suburban Washington jail
Previously, they had described him as being kept in "solitary confinement" nearly 24 hours a day for his own safety. He has a telephone and laptop with an extension cord and doesn't have to wear a prison jumpsuit.
So the suspension of risk adjustment payments could throw the rate-filing process into chaos, said Cynthia Fox, director of health reform and private insurance at Kaiser Family Foundation. The insurers have requested average rate increases for 2019 that range from 18.5 percent to 91.4 percent, depending on the type of plan. "This comes at a time when the market was looking really strong for 2019, and insurers were coming off a very profitable year".
The president last fall issued an executive order to try to make it easier for individuals and small businesses to buy health plans that cost less than ACA coverage because they cover fewer services and bypass rules meant to protect people from previous practices in which insurers charged higher prices to women, older people and those with pre-existing medical conditions. Block grants to the states would be based on ACA subsidies and the cost of Medicaid expansion "as of a fixed date", i.e., frozen, putting "federal spending on real budget", according to the plan.
Whatever happens with the risk adjustment payments, it looks as if many exchange consumers will be left to figure out their options for 2019 on their own.
Navigators applying for funding will also be encouraged to show how they will educate people about the newly expanded alternatives to Obamacare, such as association health plans and short-term plans. About 20 million Americans have received health insurance coverage through the program.
This follows a reduction announced by the CMS last August from $62.5 million, along with an even bigger cut to advertising for enrollment, and represents the latest in a series of moves to weaken the ACA by the administration of President Donald Trump.
The Affordable Care Act (ACA), which provides access to health care for millions of Americans with pre-existing conditions, came under attack by Republicans in Congress long before it became law in 2010.
CMS now wants the navigators to promote these policies in addition to steering people toward ACA-compliant plans and Medicaid.