August 1, 2018 | Ross Weiler

AIS Health: CMS’s Final Rule on Risk Adjustment May Raise More Uncertainty

Industry experts largely applaud CMS’s issuance of a final rule July 24 to restart the risk adjustment (RA) payment transfer program under the Affordable Care Act (ACA) after three weeks of uncertainty. Starting in August, as originally scheduled, CMS anticipates facilitating the transfer of $10.4 billion in RA amounts to ACA exchange plans for the 2017 benefit year.

On July 7, CMS officials said a February ruling from a federal court in New Mexico was forcing the agency to suspend the program, which is designed to spread financial risk and protect plans against adverse selection in the ACA’s individual and small-group marketplaces.

“Insurers are in the process of deciding about 2019 marketplace participation and finalizing rates, so any further delay in reinstating the payments could have negatively impacted insurance markets going into 2019 Open Enrollment — potentially leading to higher rates and fewer options for consumers,” says Ross Weiler, principal at Day Health Strategies. “However, since the suspension has only been in effect for a few weeks and rates have not been finalized, we do not believe it will have much if any impact on how insurers approach 2019.”

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