By Phil Galewitz December 10,
2019
No
clear split between conservative and liberal Supreme Court justices emerged
Tuesday as justices heard arguments over whether
the federal government could renege on Congress’ promise to pay health
insurance companies billions to motivate them to participate in the Obamacare
marketplaces.
Health
insurers hope to recoup $12 billion they believe is owed to them from that
Affordable Care Act incentive program.
During
the hour of oral arguments, six justices appeared to favor the insurers’
argument — Chief Justice John Roberts, plus justices Ruth Bader Ginsburg,
Stephen Breyer, Sonia Sotomayor, Elena Kagan and Brett Kavanaugh. Samuel Alito
seemed to side with the Trump administration. Neither Clarence Thomas nor Neil
Gorsuch spoke during the session.
The
Trump administration argues it doesn’t have to pay the money because a
Republican-controlled Congress stripped away most of the funding in 2014 and
only Congress can appropriate money under the law.
The
so-called risk-corridor payments were designed to help health plans recover
some losses in the first three years of the Obamacare marketplaces. Congress
gave the incentive because of the uncertainty insurers faced regarding how sick
or costly this previously uninsured population would be.
Insurers
that made large profits were to pay some of it back to the government to share
with money-losing insurers. But the money taken in under the program fell
billions short of the amount owed to insurers. The Obama administration told
insurers it would make up the difference with funds from the Centers for
Medicare & Medicaid Services’ budget. But in late 2014 ― after insurers
began selling policies to millions of Americans with the expectation that the
safeguard would back them up ― Congress barred the federal government from
using that funding stream.
Kagan
noted how the profitable insurers are still obligated to pay money into the
risk-corridor program even though the federal government says it no longer has
to pay out.
“You
pay in, that’s obligatory. We commit ourselves to paying out. It turns out, if
we feel like it. What, what kind of, what kind of a statute is that?” she
asked.
No
justice was more critical of the administration’s position than Breyer. He
questioned why the 2010 health law promised money to insurers who lost money
but later took it away after the insurers began covering millions of customers.
“My
hat’s on the flagpole. If you bring it down, I’ll pay you $10. You bring it
down. I owe you $10. Now how does this differ?”
Deputy
Solicitor General Edwin Kneedler, who was arguing the case for the Justice
Department, responded that insurers had many reasons to participate in the
Obamacare marketplaces beyond the promised risk-corridor payments, most notably
that they are the only places millions of people could get federal subsidies to
lower their health insurance premiums.
Roberts
interjected: “It’s a good business opportunity for them because the government
promised to pay.”
Kavanaugh,
the newest and one of most conservative justices, suggested to Kneedler that a
high court ruling against the insurers could set a precedent to not fund other
federal programs with no specific appropriation amount. “If we were to rule for
you, everyone will be on notice going forward, private parties and Congress
itself, that “shall pay” doesn’t obligate actual payments.”
A
ruling on the case, Maine Community Health Options v. United States, is
expected in the spring.
Phil
Galewitz: pgalewitz@kff.org,
@philgalewitz
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