The Hill ^ | 3/14/2014 | Elise Viebeck
Federal health officials dropped regulations late Friday outlining how they
plan to help insurance companies stuck with unanticipated costs due to
ObamaCare's botched rollout.
In a 279-page document, the Department of Health and Human
Services (HHS) detailed adjustments to the healthcare law's "risk corridors"
program, a means for shifting money from insurers who fare better under the new
system to those who fare worse.
Risk corridors have been decried by conservatives as a bailout that could
leave taxpayers on the hook for billions of dollars. The administration said
Friday that it will implement the program in a budget-neutral way.
Under
the proposed rules, the administration would tweak the formula that determines
how much money insurers pay and receive through the risk corridors.
The
change will mean that some companies see higher payments, or higher charges than
under previous rules. The calculations will correspond with insurers'
administrative costs and on average, "suitably offset" any unexpected spending,
according to the administration.
Specifically, HHS would raise the
administrative cost ceiling from 20 percent to 22 percent, and increase the risk
corridors' profit margin floor from 3 percent to 5 percent.
The notice
stated that the change would apply on a national basis in 2015 because "these
additional transitional costs and uncertainties will be faced by issuers in all
states."
The rulemaking, which carries out previous announcements, is
the administration's latest move to ease pressure on insurers from the many
delays and changes to ObamaCare's rollout. Officials are hoping the policies
will mitigate any substantial premium increases for next year.
HHS also
proposed standards for certain consumer notices, quality reporting surveys and
people involved in consumer outreach under ObamaCare.
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