State Insurance Commissioner Mike Kreidler.

State Insurance Commissioner Mike Kreidler.

State health insurers due $106 million from U.S. Supreme Court ruling

Consumers could get relief on the individual health insurance market

State Insurance Commissioner Mike Kreidler anticipates that a U.S. Supreme Court ruling this week will provide $106 million to health insurers operating in Washington and could possibly lead to premium relief for consumers who buy coverage on the individual health insurance market.

The 8-1 ruling on April 27 mandates the federal government pay participating health insurers nationwide a combined $12 billion, according to a Office of the Insurance Commissioner news release on Thursday.

The Affordable Care Act (ACA) created the Risk-Corridor Program to stabilize health premiums and provide a financial backstop for insurers willing to participate in the new market. In 2014, the Republican-controlled Congress blocked full payment for the program. It was one of three programs created by the ACA designed to help keep premiums low and provide overall stability.

Ten health insurers that offered health plans in Washington’s individual and small group markets from 2014 through 2016 are due $106.5 million. They include:

Premera Blue Cross – $42.8 million

Group Health Cooperative (now Kaiser Foundation Health Plan of Washington) – $21.6 million

Lifewise Health Plan of Washington (subsidiary of Premera Blue Cross ) – $14.3 million

Moda Health Plan – $11.6 million

Kaiser Foundation Health Plan of the Northwest – $6.6 million

Bridgespan Health Company (subsidiary of Regence BlueShield) – $ 3.8 million

Molina Healthcare of Washington – $2.8 million

Community Health Plan of Washington – $1.7 million

UnitedHealthCare of Washington – $1.4 million

Health Alliance Northwest Health Plan – $16,000

Moda Health Plan left the Washington individual market in 2017 after Congress rejected the risk corridor payments to the company. The court ruling this week means the company is due to receive $249 million for its nationwide operations, including the $11.6 million for its previous Washington business.

“I agree with the court’s ruling that a Republican Congress led a ‘bait-and-switch’ of staggering dimensions,’” Kreidler said in the news release. “Their effort resulted in some insurers becoming insolvent and others to abandon individual markets, which left consumers with fewer choices and higher costs. Instead of working to improve the Affordable Care Act, they have done everything they can to undermine it and harm consumers. The Supreme Court this week made a definitive statement on their adverse actions.”

Kreidler said his office will contact the insurers owed money to determine how they will use the funds when calculating future premiums for their individual market health plans. He noted the companies have yet to learn when they will receive the funding from the Trump administration.

“We are going to watch closely how the insurers use the money and hold them accountable to those who buy their insurance through the individual market,” Kreidler said. “This is especially important now with more people losing their employer-based coverage because of the coronavirus effects and who may be looking for coverage.”

Approximately 248,000 people who don’t get coverage from their employer buy their own health insurance through the individual market, with most shopping on the Washington Exchange. In Washington, 65% of people who buy plans on the Exchange qualify for subsidies that help lower their monthly premiums.

A special enrollment period for Exchange plans in response to the coronavirus pandemic continues through May 8.


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