Health Care Insurers Show Winning Hand in Court over CSR Payments

The nation’s health insurance companies have been winning lawsuit after lawsuit over the Trump administration’s decision to end cost-sharing reduction (CSR) payments in 2017.

CSR payments are a feature of the Affordable Care Act (ACA, or Obamacare) that sent billions to insurers to help them restrain premiums for low- and middle-income customers on the Obamacare exchanges, defined as those with incomes below 250 percent of the federal poverty limit, or $63,125 this year for a family of four.

insurers-winning-on-the-aca-csr-frontSuch payments were routinely made under the Obama administration, but House Republicans sued on the grounds that Congress had never authorized the funding. A D.C. district judge agreed, allowing the Trump administration to end the program.

Now, the insurers are striking back and finding a friendly resource for their cause. Of 12 cases arguing the payments are part of the ACA and must be restored, six have so far gone in favor of the providers and not the White House. All of the cases have been heard before judges at the Court of Federal Claims, which can order the government to pay up even if Congress never appropriated the funds.

Just this past week, four decisions went the insurers’ way, with one of them a class action lawsuit involving 91 insurers, bringing the total number of victorious providers to 100.

If the remaining cases rule that CSR payments should be resumed and insurers compensated for payments not received from 2017 on, the administration would be on the hook for $12 billion a year in ongoing CSR payments, and billions more in past obligations.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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