Listen: A Sudden Freeze On ACA Payouts And What It Means For You

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Over the weekend, Seema Verma, administrator for the federal Centers for Medicare & Medicaid Services, said she was suspending $10 billion in “risk adjustment” payments that helped stabilize the insurance markets created under the health law.

Julie Rovner, chief Washington correspondent and host of KHN’s “What the Health?” podcast, explains the national picture on “The Takeaway” for WNYC:


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Chad Terhune, senior correspondent, explains the effects of this development in California and other states for South California Public Radio:


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They examine what health insurers and Covered California officials have described as another curveball from the Trump administration meant to weaken the Affordable Care Act.

Verma said the “risk-adjustment” payments and collections had to be halted in response to a New Mexico court ruling in February that said elements of the program were flawed. Another court in Massachusetts had upheld the program in January.

The risk-adjustment program was meant to stabilize the insurance exchanges by taking money made through low-risk consumers and shifting it to higher-risk pools. The federal government collects money from some insurers that enrolled healthier patients and then transfers money to other insurers who had sicker enrollees.

Because the Affordable Care Act requires insurers to accept all people regardless of their medical history or preexisting conditions, architects of the law created the program to prevent insurance companies from cherry-picking the healthiest people.

The Republican-led Congress failed last year to repeal and replace the ACA. However, Republican lawmakers and the Trump administration have made a series of moves intended to weaken the health law, such as halting subsidies that covered some consumers’ out-of-pocket costs and eliminating the penalty.

Related Topics

Cost and Quality Courts Insurance The Health Law