Published: Fri, July 13, 2018
Medical | By Johnnie Horton

CMS Cuts ACA Navigator Funding Grants by $26M for 2019

CMS Cuts ACA Navigator Funding Grants by $26M for 2019

Two health insurers in CT,

The Trump administration announced Tuesday it is making further cuts to the "navigator" program that provides in-person assistance to people seeking coverage on Obamacare's web-based marketplace.

They say the moves will siphon healthier customers out of the Obamacare markets, raising premiums for everyone, and that Republicans will pay a political price for the moves in this November's mid-term elections.

But the Trump administration is hanging its decision to withhold subsidies to insurers on court decisions from New Mexico and MA which say the way those payments are handed out is too vague.

More than a dozen co-ops have failed since the ACA's implementation, and most have blamed the risk adjustment program. The Trump administration also is seeking to expand the use of short-term health insurance plans that are often less expensive but don't have the same consumer protections as exchange plans.

"It is time to get the navigator application to launch", Seema Verma, the CMS administrator, stated in a press launch that mentioned the achievement of commercial agents in registering individuals and stressed the value of spending national funding more judiciously. The judge tossed out the formula used to calculate payments, finding that it was flawed.

Larger insurers have called for CMS to quickly devise an alternative to risk-adjusted payments.

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"The federal government's decision to suspend payment transfers under the ACA's risk adjustment program could have a significant impact on premiums and place an additional burden on people in the community who can least afford it", CareFirst's president and CEO, Brian Pieninck, said in a statement.

"The Trump administration's suspension of risk adjustment payments is just the latest attempt to undermine health care for millions of consumers across the country, including about 270,000 people enrolled in Washington state's individual market".

A federal court ruling in New Mexico found the administration did not properly justify its formula for dispensing the funds.

Technically, the administration has only suspended risk adjustment payments, not permanently ended them.

But CareFirst and Kaiser could ask to adjust their rates higher given the Trump administration's decision. Rate filings by CT health insurers for 2019 are due next week. If that doesn't happen, some insurers may need to boost their premiums for 2019, she said. The other two methods were temporary, but risk adjustment is permanent.

For the past five years, when insurance has been available through ACA marketplaces for people who do not have access to affordable health benefits through a job, federal health officials have started every spring working with navigator groups on plans for the coming enrollment season.

But Senator Ron Wyden, the ranking Democrat on the Senate Finance Committee, said encouraging navigators to promote plans that don't comply with the ACA is "federally funded fraud: paying groups to sell unsuspecting Americans on junk plans that allow insurance companies to deny care on a whim and charge whatever they want is nothing but a scam".

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