The Supreme Court will delve into how much power members of Congress wield when they insert riders on appropriations bills, in a trio of cases that deals with $12 billion in payments to insurers related to the 2010 health care law’s exchanges.
The justices agreed Monday to decide whether lawmakers can essentially repeal a previous law that obligates government payments by later adding riders to a spending bill to prevent those payments.
Three health insurance companies want the Supreme Court to overturn a lower court ruling they say will create a blueprint for how individual members of Congress and their staff can avoid a broader debate about repealing a law and instead accomplish their goal through the appropriations process.
Congress “should not be allowed to have its cake and eat it too by making statutory promises disappear via mere implications in the legislative history of appropriations bills,” Oregon-based insurer Moda Health told the court in a brief. “That is a recipe for disaster that no decision of this court does or should countenance.”
The case will return the Supreme Court to the long-contentious issue of the health care law in the next term, in what could be the height of the 2020 presidential campaign. It will not threaten the health care law itself.
The dispute focuses on a section of the law that required the government to reimburse health insurers for the “risk corridors” program for the first three years of the law. Insurance companies participated under the expectation they would be repaid.
But the Republican-led Congress later used a rider in fiscal appropriations bills for 2015, 2016 and 2017 to prevent the Department of Health and Human Services from fully making those reimbursements.
“The net effect was a bait-and-switch of staggering dimensions in which the government has paid insurers $12 billion less than what was promised,” Moda Health wrote in a brief.
Risk corridor collections fell far short of the administration’s obligations. In 2014, insurers were paid just 13 percent of what they were owed. The shortfall triggered a series of closures for nonprofit health plans created under the health care law and set off a fierce debate in Congress, with Republicans deriding the payments as “bailouts” to the insurance industry.
Lawsuits from dozens of other health plans are on hold until the Supreme Court decides the cases. Along with Moda Health, the high court challenges are brought by Illinois-based Land of Lincoln and Maine Community Health Options.
The Federal Circuit, which hears contract disputes with the government, decided in June 2018 that Congress clearly indicated its intent “to temporarily cap” payments in the spending bill.
The decision cited a statement from Kentucky Republican Rep. Harold Rogers that the rider meant the government would not pay out more than it collected through the program.
And the court also cited how lawmakers requested a Government Accountability Office report on the reimbursements and then cut off the sole source of funding other than those collections.
“What else could Congress have intended?” the Federal Circuit wrote.
The payments were one of three programs to mitigate risk for health insurers, and meant to compensate insurers for setting premiums too low based on projected medical costs from 2014 to 2016, and penalize insurers who set their premiums too high.
The Trump administration told the Supreme Court the health care law left the program unfunded, and therefore left for later the policy decisions on that program of whether and to what extent it should be funded.
“When Congress subsequently confronted those policy decisions in enacting appropriations acts for the relevant years,” the Justice Department wrote in a brief, “it expressly and repeatedly prohibited HHS from using the only potential source of funds to make payments out other than payments in collected from profitable insurers under the risk-corridors program itself.”
Land of Lincoln, which was placed in liquidation in 2016 causing some 50,000 consumers in Illinois to lose coverage, pointed out to the Supreme Court in a brief that Congress did not repeal or amend the risk-corridor section of the health care law despite repeated legislative proposals.
Land of Lincoln also wrote that the Federal Circuit’s decision “will trigger further insolvencies and increase the cost of insurance for tens of millions of consumers.”
The cases are Maine Community Health Options v. United States, Docket No. 18-1023; Moda Health Plan, Inc., v. United States, Docket No. 18-1028; and Land of Lincoln Mutual Health v. United States, Docket No. 18-1038.
Lauren Clason contributed to this report.