Insurer sues feds over shortfall in ObamaCare payments

Blue Cross Blue Shield of North Carolina is suing the federal government over certain ObamaCare payments it says it is owed. 

{mosads}The move is a sign of growing calls from insurers to recoup the funds they say they are owed under ObamaCare’s “risk corridor” program. 

That program was designed to cushion insurers from heavy losses in the early years of the law by redistributing money from insurers with low claims costs to those with high claims costs. But not enough money came into the program, and the government was only able to pay out 12.6 percent of what insurers should have received. 

Blue Cross of North Carolina follows Moda Health in Oregon earlier this week, and Highmark last month, in suing the federal government in the U.S. Court of Federal Claims to try to get the money it says it is owed. 

Blue Cross says it was supposed to receive $147 million in 2014, but only ended up receiving $18 million. 

Republicans have derided the risk corridor program as a “bailout” of insurance companies, and helped pass language through Congress that limited the payments by making the program budget neutral. 

Insurers say the shortfall in risk corridor payments is one of the reasons that many of them are losing money on the ObamaCare marketplaces. 

“[Blue Cross of North Carolina’s] decision to participate in this new, volatile ACA marketplace was impacted by our reliance on the government’s assurances that the risk corridor program was in place to provide some protection against the significant losses we have suffered,” Blue Cross general counsel King Prather said in a statement. “All we’re asking is that the federal government live up to its promises and pay what it is legally and contractually required to pay.”