Phil Ammann
Quietly, with little fanfare, Marco Rubio has single-handedly shaken the foundation of the Affordable Care Act, putting President Barack Obama’s signature health care law into question.
First reported by Robert Pear of The New York Times, the Florida senator and presidential candidate last year slipped in a little-noticed provision into a massive spending bill, which became the first substantive move toward dismantling Obamacare.
The measure, attacking the “risk corridor provision” of the ACA, may have garnered little attention for Rubio, but the effort to limit the amount the government can spend on protecting insurance company from financial losses has been more than effective, sending shock waves through the entire industry.
Risk corridors are designed to support insurance companies receiving too many new sick patients and having too little premium cash to cover medical bills during the first three years of the health care law. Rubio’s measure will result in the federal government paying only 13 percent of the amount expected by insurance companies this year. The payments, Pear writes, were intended to help insurers manage risks assumed when signing up for the ACA’s federal marketplace.
With the change, Rubio gets a tailor-made political talking point – “no taxpayer bailout for insurance companies.” But without those payments, insurers argue that premiums are certain to rise and some consumers may be forced to fill in coverage gaps.
Pear notes that some insurers have already shut down in the wake of the unexpected payment reduction.
Dawn Bonder, president of Health Republic of Oregon, says her insurance co-op will be forced to close its doors, a result of only receiving $995,000 of the $7.9 million expected from the federal government.
“Risk core doors have become a political football,” Bonder told the Times. “We were stable, had a growing membership and could have been successful if we had received those payments.
“We relied on the payments and pricing are plans,” she added. “But the government reneged on its promise. I am disgusted.”
Of 23 nonprofit insurance cooperatives created under the ACA, 12 have failed, with more than 700,000 people losing coverage. Bonder and other co-op executives blame slashed federal payments.
For his part, Rubio is continuing unabated. In the final spending bill now up for consideration, he is calling for the provision restricting risk corridor payments to remain intact. The spending proposal is up against a Friday deadline, when a majority of the federal government funding runs out.
“If you want to be involved in the exchanges and you lose money,” Rubio said on the Senate floor, “the American taxpayer should not have to bail you out.”
Rubio estimates he saved taxpayers “$2.5 billion” – the difference between requests for risk corridor payments ($2.9 billion) and the $362 million that profitable plans have paid into the program.
Insurance companies are now lobbying for the money they were promised, or some other relief to make up the shortfall.
