Working from the Ground Up: A Repeal of the ACA
December 03, 2014
Imbedded in the Affordable Care Act (ACA) are three risk-sharing stipulations that financially help insurers during the first few years since the insurance marketplace started. Often called the “3 R’s,” Risk Adjustment, Reinsurance and Risk Corridors together build the foundation of the ACA and assist insurance companies entering into the insurance marketplace. In conservative’s tireless effort to repeal Obamacare, both the House of Representatives and Senate are working on bills that address the risk corridors program. Arguably, a repeal of risk corridors would completely disintegrate the fabric of the ACA.
By Jacob Valdez, CAS’15
Who will inevitably purchase medical insurance coverage in the market place is uncertain. Risk corridors are intended to limit this uncertainty by sharing risk between qualified health plans (QHPs) and the federal government. For instance, if premiums fall short of medical expenses, the risk corridors program transfers a portion of the deficit to the qualified health plan. Though, the money from this transfer comes directly from tax payer dollars. In an effort to combat this type of government and taxpayer-funded bailout, Representative Tim Griffin proposed the first definitive repeal of the risk corridors program.
Tim Griffin previously served as the 24th representative of Arkansas’s Second Congressional District. For the 113th Congress, Griffin now serves on one of the most powerful and oldest committees in Congress – House Ways and Means Committee. On June 4th, 2014, Griffin introduced the Obamacare Taxpayer Bailout Protection Act, which called for an amendment on risk corridors in the Patient Protection and Affordable Care Act. H.R. 4354 directly prohibits the taxpayer-funded bailout of health insurance companies. The bill has since been referred to the Subcommittee on Health but its ideological framework persists in the Senate.
Senator Marco Rubio of Florida first introduced Senate bill S.1726 on November 19th, 2013. Similarly dubbing the Obamacare Taxpayer Bailout Prevention Act, S.1726 called for the same repeal on the Patient Protection and Affordable Care Act that required the Secretary of Health and Human Services (HHS) to coordinate the risk corridors program from 2014 to 2016. The repeal disables qualified health plans from having to join the payment adjustment system. Although the bill sits in the Committee on Health, Education, Labor and Pensions, Senator Rubio introduced another bill, S.2214, which again called for the same repeal to ensure government’s cost to carrying out the program was zero. Now, the bill sits in the same committee, but its continual fight against the ACA is not over.
Recently, the repeal of the risk corridors provision has gained more publicity after President Obama’s response to insurance cancellation. In lieu of its attention, Senator Rubio commented in the Wall Street Journal that “their dirty little secret is out, and it should be wiped out from the law.” Rubio’s current legislation has already garnered support from conservative organizations like the Heritage Foundation. Could this be the beginning of the end for the ACA?
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