- Associated Press - Thursday, April 6, 2017

SIOUX FALLS, S.D. (AP) - Sanford Health Plan has filed a lawsuit alleging the federal government owes it nearly $9 million in payments under a program included in former President Barack Obama’s federal health care law.

The program, which lasted from 2014 to 2016, established “risk corridor” payments to health insurers to help offset any uncertainties of selling individual insurance plans on the newly created exchanges, the Argus Leader (https://argusne.ws/2nHLGMB ) reported.

Sanford Health serves South Dakota, North Dakota and Iowa.

Congress prohibited the U.S. Department of Health and Human Services from using certain accounts to make risk corridor payments, resulting in insurers nationwide foregoing billions of dollars.

Government officials said they were confident the program would be revenue neutral, with profits from high-revenue insurers offsetting losses from low-revenue insurers. But the program’s first year saw profits at $362 million and losses at $2.87 billion.

Sanford Health Plan has followed the law and brought high-quality, affordable health insurance to the people of South Dakota, North Dakota and Iowa,” Sanford chief marketing officer Cindy Morrison said. “Unfortunately, the government has not met its payment obligations, and Sanford Health Plan has brought this lawsuit in order to ensure that the government lives up to its end of the bargain.”

Sanford is joining about 20 other insurance companies in filing suit in the U.S. Court of Federal Claims. In a past case brought by Moda Health Plans, Judge Thomas Wheeler found the government had a contractual obligation to make the payments.

“There is no genuine dispute that the government is liable to Moda,” Wheeler wrote. “Whether under status or contract, the court finds that the government made a promise in the risk corridors program that it has yet to fulfill.”


Information from: Argus Leader, https://www.argusleader.com

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