- Amid calls of unfairness around the ACA's controversial risk adjustment program, some insurers are specifically pointing fingers at competing Blues plans as examples of those that may be inappropriately benefiting from flawed program policies at smaller rivals' expense, Kaiser Health News reported.
- The argument is the risk-adjustment formula is inadvertently rewarding health plans with excessively high administrative costs and higher premiums, including many of the Blues.
- At stake is what to do about the issue, as the government plans tweaks in response to industry complaints while the Blue Cross Blue Shield Association lobbies to maintain the status quo.
There's no question the current risk adjustment policy has overall served the Blues well given its staunch support, though opposition has been strong from other industry players who argue the current proposed modifications to the formula are insufficient, such as incorporating prescription drug data beginning in 2018. General marketplace changes have been addressed in a proposed rule released in August, and HHS has since hinted that more are to come.
Given that risk adjustment is a permanent provision under the health law unlike the related and also controversial risk corridors program, debate can be expected to continue until more stakeholders are satisfied--or decide whether it's a dealbreaker for their continued ACA business.
Policymakers are between a rock and a hard place as they risk any further insurer attrition from the marketplaces, and Blues plans are key players in most state markets. It wrote to the administration earlier this year that it “should not heed the calls to make radical changes to the risk-adjustment model from a small, but vocal, minority of health plans that did poorly.”
Opponents have included some health insurance co-ops that have gone so far as to sue the federal government for creating a competitive disadvantage, as well as Aetna, which has also voiced the position that the current formula rewards "inefficient and expensive" plans, KHN noted.