On January 3, 2017, Judge Margaret Sweeney of the United States Court of Claims certified Health Republic Insurance Company v. United States as a class action. This is one of more than a dozen cases that have been brought by insurers in the Court of Claims challenging the failure of the government to pay marketplace insurers amounts that they claim were due to them under the ACA’s risk corridor program. The class includes:
All persons or entities offering Qualified Health Plans under the Patient Protection and Affordable Care Act in the 2014 and 2015 benefit years, and whose allowable costs in either the 2014 or 2015 benefit years, as calculated by the Centers for Medicare and Medicaid Services, were more than 103 percent of their target.
This would include all insurers who would have qualified for risk corridor payments under the ACA and implementing rules had Congress not limited risk corridor payments for 2014 and 2015 to funds collected from insurers by using appropriations riders. Under Court of Claims procedures, all members of the class must be notified and decide whether or not to opt in to the class.
In September HHS suggested that it might be amenable to settling the risk corridor litigation, but by October, after a storm of criticism from Congress, HHS was vigorously defending the cases, one of which it has since won.
The certification of a class would simplify settling the cases, but the Obama administration probably will not be around long enough to pull off a settlement, even assuming it wants to settle. It is hard to believe that the Trump administration will want to settle the risk corridor cases, but it is also hard to say what the Trump administration wants yet in health policy, and a settlement could make a major contribution to stabilizing the individual insurance market, which could be something it wants. There is always a chance the insurers will win in court as well.