Humana writes off $591M in risk corridor payments
Federal risk corridor payments no longer deemed collectible given recent court ruling.
Humana has written off $591 million in risk corridor payments because of a November court ruling which went against insurers.
The risk corridor program was established in the Affordable Care Act as a way to stabilize premiums for consumers getting coverage on the exchanges. A federal court ruled the payments were never approved by Congress.
All payments to insurers, therefore, have been budget neutral, with the Centers for Medicare and Medicaid Services making payments to insurers only as other insurers have paid money owed to the program.
CMS is currently still making payments on what it owes from 2014.
[Also: AMA wants court to block Aetna-Humana merger]
Humana said it anticipates collecting about $8 million in risk corridor receivables outstanding as of September 30, 2016, associated with the 2014 plan year. This is in addition to $30 million already collected from CMS in risk corridor payments for 2014.
The risk corridor premium stabilization program expires December 31.
On November 10, the U.S. Court of Federal Claims ruled in favor of the government in one of a series of cases filed by insurers against the Department of Health and Human Services to collect risk corridor payments.
Twitter: @SusanJMorse
