//  5/24/17  //  Quick Reactions

On Monday, the House of Representatives and the Trump Administration filed their latest status update in House v. Price, a lawsuit brought by the House involving the Affordable Care Act’s cost-sharing reductions that has been covered repeatedly for this blog. According to the latest update, the parties “continue to discuss measures that would obviate the need for judicial determination of this appeal, including potential legislative action,” and as such they request the abeyance be continued. On its face, this status update appears to be a non-decision, a punt to the next status update 90 days from now. But in reality, this inaction masks the uncertainty it creates in the insurance markets.

I’ve written about this issue before for Take Care, but the point is worth emphasizing. Insurance companies are filing their applications for 2018 plans and rates now, with the last deadline in some states coming on June 21, and with many having passed already. If you’re an insurance company not only watching Congress try to pass health care reform, but also watching the Republicans in both branches of government decide whether or not to pay you under this lawsuit, how can you set those rates for next year? If you don’t know what the rules of the game will be, how can you play it?

So far, at least some insurers are pricing their plans for next year assuming the cost-sharing reductions will not be paid out. This means they’re requesting much higher rates, citing the uncertainty from the lawsuit as one major contributor. Some may drop out altogether. But the ultimate irony? This charade is costing the federal government more than it’s saving. The Kaiser Family Foundation estimated that the federal government would end up spending $2.3 billion more in 2018, and $31 billion more over the next decade, if it eliminated these payments. That’s not a good deal for America.

For other House v. Price news, go read Nick Bagley’s explainer about the motion to intervene filed last week by fifteen states and the District of Columbia and its potential impact on the lawsuit. 

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