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| President Obama's plan to use reinsurance funds to prop up ObamaCare isn't just wrong -- it's unconstitutional! |
The administration has had a proclivity for circumventing Congress when President Obama doesn't get his way. This time, taxpayers could be on the hook for a bailout of health insurance companies that have lost money through the ObamaCare exchanges.
Recently, the Washington Post reported that the Justice Department is considering tapping the Treasury Department's Judgment Fund, which is used to pay federal legal claims, to settle with health insurance companies that are suing the administration over financial losses from their participation in ObamaCare.
Congress, however, has prohibited any taxpayer-funded bailout of insurers.
Settling with plaintiffs out of court is a fairly common tactic for this administration. It is known as "sue-and-settle."
A plaintiff, often a special-interest group, will sue the federal government and, behind closed doors and away from public scrutiny, the administration will settle, rather than defend itself, and take an action or agree to promulgate regulations at the heart of the lawsuit.
Meant to be a transitional component of ObamaCare, the "risk-corridors" program redistributes money from profitable health plans to those that run in the red.
While there is no statutory requirement that the risk-corridors program be revenue-neutral, as Peter Suderman explained in 2014, "The thinking when the law was passed was that the program would be revenue neutral; some insurers would pay in, and others would be paid. The payments would even out."
But things didn't work out the way the administration and insurers planned. The risk pools are unbalanced, with too many older and less healthy consumers, those who utilize health care at higher rates, and too few young and healthy people enrolled for coverage.
Also, there are fewer people enrolled in government-approved health plans available on the exchanges.
The Congressional Budget Office projected that 13 million people would have coverage through the ObamaCare exchanges in 2015.
In September 2015, however, the Centers for Medicare and Medicaid Service (CMS), an agency inside the Department of Health and Human Services (HHS), reported that 9.95 million people obtained coverage through the exchanges.
The agency claimed that "these numbers are consistent with HHS' effectuated enrollment target of 9.1 million for the end of 2015."
Not so much. Before the launch of the 2015 enrollment period, HHS revised downward its enrollment projections for the year by as much as 30%, bringing expected enrollment down from 13 million to between 10 million to 11 million consumers before attrition. HHS claimed a victory after moving the goal posts.
More recently, major health insurers have either pulled out of the ObamaCare exchanges or significantly ratcheted down their participation. Notable names include UnitedHealth Group (the largest insurer in the United States) and Aetna, both of which have lost hundreds of millions of dollars because of ObamaCare.
What's more, only seven of the 23 ObamaCare cooperatives, which were supposed to serve as Democrats' compromise on the public option, remain in operation.
With insurers facing heavy and unsustainable losses from their participation in ObamaCare, Congress acted to protect taxpayers from any bailout of insurers.
In the fiscal 2015 hybrid spending bill, the language was included to prohibit CMS from using taxpayer dollars from specific accounts to bailout insurers. The provision was included again in the FY 2016 funding bill.
With its plan to use a Treasury Department fund (aka taxpayer dollars) to circumvent the congressional prohibition to settle out of court with insurers, the administration is violating the spirit of the law.
Not only does this attempt to bail out insurers show that ObamaCare continues to experience significant problems, highlighting the need for Congress to scrap it and implement real health care reforms that emphasize patient-centered policies and to roll back regulations driving up the costs of health coverage, it also underscores the constitutional struggle between the executive and legislative branches of the federal government.
Already, four senators — Mike Lee (R-UT), John Barrasso (R-WY), Marco Rubio (R-FL), and Ben Sasse (R-NE) -- have fired off a letter to Attorney General Loretta Lynch and HHS Secretary Sylvia Burwell, in which they noted that any payment from Treasury's Judgment Fund "would be illegal."
Moreover, the senators explained, insurers, if successful in the lawsuit, "would not be able to recover any additional funds, until insurance companies paid additional money into the program or Congress appropriated additional funds."
Unfortunately, the Obama administration has demonstrated time and time again that it has little regard for the constitutional separation of powers or respect for the rule of law.
Article I of the Constitution, which puts the power of the purse and lawmaking authority solely in the hands of Congress, is being erased before Americans' eyes.
America is at a crossroads. Either Congress reinforces its constitutional role, or America takes a turn down a road to toward the permanent imperial presidency.
If Congress refuses to act or continues to play small ball with largely meaningless "fixes" for ObamaCare, it will be complicit in the decay of the American experiment.
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Adam Brandon is the president and CEO of FreedomWorks.
Tags: ObamaCare, Risk corridors, ObamaCare Bailout, bailout, health insurers, U.S. Senators,Mike Lee (R-UT), John Barrasso (R-WY), Marco Rubio (R-FL), Ben Sasse (R-NE), letter, Attorney General Loretta Lynch, HHS Secretary Sylvia Burwel, Adam Brandon, Freedom Works To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. and "Like" Facebook Page - Thanks!
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