A federal court has dismissed a $23 million lawsuit filed by Lewiston-based Affordable Care Act insurer Maine Community Health Options over losses it suffered in 2015.
Community Health Options sued the federal government in August 2016, claiming it was owed $22.9 million under the ACA’s temporary “risk corridors” program, designed to help insurers manage costs, profits and losses for the first three years of the health care law’s implementation. Insurers with lower-than-expected costs paid a portion of their profits into the program, while insurers with higher-than-anticipated costs were promised payments to help offset losses.
But this week, the U.S. Court of Federal Claims ruled that Community Health Options, a nonprofit insurance co-op, is not entitled to the money it is seeking.
Losses claimed by insurers nationwide have dwarfed the amount paid into the risk corridors fund by those that turned a profit, and Congress has not authorized the use of any public money to supplement the fund. As a result, dozens of insurers nationwide have sued the federal government.
Community Health Options paid $2 million into the risk corridors program in 2014, when it had a surplus of $7 million, but it has said that it received nothing under the program for the $31 million loss it incurred in 2015. Its $22.9 million claim is based solely on 2015 losses, and not what the insurer contributed to the risk program in 2014.
The court ruled that Congress has barred the risk corridors program from paying anything beyond what was collected from the profitable insurance carriers. The total amount collected was only a fraction of the roughly $8.3 billion in losses claimed by ACA insurers in 2014 and 2015, according to the U.S. Department of Health and Human Services.
Community Health Options already has filed a motion to appeal the judge’s ruling. “Our argument is just as strong on the merits and will be heard and determined upon appeal,” Community Health Options CEO Kevin Lewis said.
J. Craig Anderson can be contacted at 791-6390 or at:
Twitter: jcraiganderson
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