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Insurers warn of rising premiums after Trump axes Obamacare payments again


By Amanda and O'Donnell

WASHINGTON/NEW YORK (Reuters) - Health insurers warned that a move by the on Saturday to temporarily suspend a program that was set to pay out $10.4 billion to insurers for covering high-risk individuals last year could drive up premium costs and create marketplace uncertainty.

The Affordable Care Act's (ACA) "risk adjustment" program is intended to incentivize health insurers to cover individuals with by collecting money from insurers with relatively healthy enrollees to offset the costs of other insurers with sicker ones.

has used its regulatory powers to undermine the ACA on multiple fronts after the Republican-controlled last year failed to repeal and replace the law propelled by Democratic About 20 million Americans have received coverage through the program known as Obamacare.

America's Plans (AHIP), a group representing insurers offering plans via employers, through government programs and in the individual marketplace, said the CMS suspension would create a "new market disruption" at a "critical time" when insurers are setting premiums for next year.

"It will create more market uncertainty and increase premiums for many health plans - putting a heavier burden on small businesses and consumers, and reducing coverage options. And costs for taxpayers will rise as the spends more on premium subsidies," AHIP said in a statement.

It could also encourage more insurers to bow out of Obamacare.

"This is occurring right at the time of year that people (insurers) are making decisions about whether to participate in the exchanges and what premiums to charge if they do," said Eric Hillenbrand, a at consultancy "This will affect their thinking on both of those decisions."

The Centers for and (CMS), which administers ACA programs, said on Saturday that months-old conflicting court rulings related to the risk adjustment formula prevent them from making payments.

CMS was referring to a February ruling from a federal court in that invalidated the risk adjustment formula, and a January ruling from a federal court in that upheld it.

CMS said in a statement the administration was "disappointed" in the February ruling and that CMS has asked the court to reconsider and "hopes for a prompt resolution that allows CMS to prevent more adverse impacts on Americans."

But supporters of the ACA criticized the CMS announcement as the latest move by the to undermine Obamacare.

"We urge the to back off of this dangerous and destabilizing plan, and instead begin working on to make coverage more affordable," said Brad Woodhouse, the of Protect Our Care, a group that supports Obamacare.

The administration has made several other moves in recent years to scale back or halt implementation of certain aspects of the ACA.

Late last year, it said it would halt so-called cost-sharing payments, which offset some for low-income patients.

It has also scaled back the for Obamacare during the open-enrollment period by about 90 percent.

"What you are effectively doing is dismantling pieces of [the ACA] without replacing them," Hillenbrand said. "It moves us back to some extent to the status quo where people with pre-existing conditions found it very difficult to get insurance."

(Additional reporting by in Washington; Editing by and James Dalgleish)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, July 09 2018. 10:46 IST