Tuesday, September 27, 2016

Morgan Griffith on the Latest Problems with Obamacare

From U.S. Representative Morgan Griffith (R-VA-9):

Big Insurance Bailout
During a recent Energy and Commerce hearing, I questioned Andy Slavitt, Acting Administrator of the Center for Medicare and Medicaid Services (CMS), about CMS’ memo regarding Risk Corridors. The Risk Corridors in Obamacare were protections for insurance companies who lost money in the exchanges. Insurance companies who participated in the exchanges paid certain fees. The theory was those insurance companies who lost money would be reimbursed out of those fees. Projections by the Obama Administration indicated those fees should have been sufficient to pay for any and all losses.

Based on information from the CMS website, in 2014, $362,000,000 was paid in by insurers. However, insurance companies have requested $2,870,000,000 in payments. Therefore, CMS estimates insurers will be paid 12.6% of requested funds, with a shortfall of $2,508,000,000.

Now some big insurance companies are suing to be made whole.

But Congress has required these payments be budget neutral, meaning CMS could only pay out what it took in from the fees.

CMS’ memo was essentially an invitation to insurers to sue and settle with the federal government for 2015 Risk Corridor payments. But where is the money coming from?

In my questioning, I asked Acting Administrator Slavitt if CMS takes the position that insurance plans are entitled to be made whole on Risk Corridor payments even though there is no appropriation – congressional approved money – to do so. After stumbling, Slavitt said, “Yes. It’s an obligation of the federal government.”

Mmm? Congress dictates how much government can spend, and both Republicans and Democrats said CMS can only spend as much as was put in. Thus, it is clear the Administration is once again attempting to thwart congressional intent.

In this case, to bailout big insurance companies.

Further, I asked if CMS intended to use the Judgement Fund to make Risk Corridor payments to these insurance plans. According to and managed by the U.S. Treasury, the Judgment Fund is a “permanent, indefinite appropriation…available to pay compromise settlements entered into by the U.S. Department of Justice related to actual or imminent litigation…”

Slavitt would not confirm, but did say that CMS is working with Justice.

I, along with several of my colleagues from the Energy and Commerce Committee, wrote to Health and Human Services Secretary Sylvia Burwell asking for specifics on how they plan to pay for settlements and relay some of our concerns. In the letter, we stated, “It appears that any such settlements would come from the permanent appropriations for judgments (‘Judgment Fund’)…Further, the Administration’s explicit offer to settle these lawsuits appears to be a direct circumvention of the clear Congressional intent to prohibit the expenditure of federal dollars on this program…”

If Justice uses the Judgment Fund – the same fund the Administration used to pay Iran ransom payments – to settle these lawsuits, they would be ignoring congressional intent.

The Risk Corridors program has failed.

The Administration may bailout big insurance.

What part of Obamacare unravels next?

80 Percent Not Helped
I have consistently acknowledged that Obamacare has helped some, but many have been saddled with higher out-of-pocket costs and less choice. Amongst the many negatively impacted, one woman I recently spoke with at the New River Valley Fair told me that Obamacare is killing her family. In order to afford any insurance after Obamacare, she had to agree to pay high co-pays and deductibles. These high co-pays and deductibles caused her and her husband to have to sell assets. If the medical conditions continue, she fears being forced to sell her home.

This is not the bright new future Obama promised when promoting his health care plan.

According to a Washington Post Opinion piece titled, If Trump Wins, Blame Obamacare, “Only 18 percent of Americans believe the Affordable Care Act has helped their families; 80 percent say it has hurt or had no effect.”

Not only was the launch of the website a disaster, but only 17 state-based exchanges were established and four of those have already failed. Additionally, many of the 23 original nonprofit co-ops have crumbled.

The promises of Obamacare – you can keep your doctor and your premiums will be lower – have proven false for many Americans.

And now more bad news. Insurance providers are dropping like flies due to substantial losses under Obamacare, resulting in slim pickings of insurance plans for many Americans, particularly rural Americans.

What part of Obamacare will unravel next?

If you have questions, concerns, or comments, feel free to contact my office. You can call my Abingdon office at 276-525-1405 or my Christiansburg office at 540-381-5671. To reach my office via email, please visit my website at www.morgangriffith.house.gov. Also on my website is the latest material from my office, including information on votes recently taken on the floor of the House of Representatives.