Will HHS bother to provide a legal justification for ObamaCare's risk corridor program? Inquiring Republicans want to know

The Obama administration has lately been attempting to calm the fears of a jittery insurance industry that’s rather concerned about its long-term profitability should the ObamaCare insurance marketplaces not turn out according to plan. In February, the Obama administration was toying with the idea of extending the bailout risk-corridor program — designed to provide money to insurance companies struggling to make ends meet, should the need arise during ObamaCare’s initial phases — beyond its original sunset date set for 2016; and in May, the administration assured insurance companies worried about “unexpectedly” high premiums that they would break the program’s original budget-neutral provision and find even more moolah for the insurance companies if need be. As CMS put it in the relevant regulatory filing, “In the unlikely event of a shortfall for the 2015 program year, HHS recognizes that the Affordable Care Act requires the Secretary to make full payments to issuers. In that event, HHS will use other sources of funding for the risk corridors payments, subject to the availability of appropriations.”

Mmm, hmm. Where, pray tell, might these appropriations come from, if not with the approval of Congress? And, if it comes to that, does the administration really have the authority to carry out this risk-corridor program at its own discretion, at all? This is pretty much the same question Sen. Marco Rubio asked of the administration last fall, and evidently, the White House has yet to deign to provide answers. Via the WFB:

Senate Budget Committee Ranking Member Jeff Sessions (R., Ala.) and House Energy and Commerce Committee Chairman Fred Upton (R., Mich.) sent a letter to Health and Human Services (HHS) Secretary Sylvia Burwell on Tuesday, asking whether her agency has the statutory authority for the risk corridor program, which some have called a bailout of the insurance industry.

“Under current law, payments made under the risk corridor program would constitute an unlawful transfer of potentially billions of taxpayer dollars to insurers offering qualified health plans under the president’s health care law,” Sessions and Upton Wrote. …

“HHS may not make payments under Section 1342 absent additional congressional action appropriating funds for such payments,” they wrote.  “Without an explicit appropriation, any money spent on the risk corridor program would be based on an illegal transfer of funds and your agency could be held in violation of the Antideficiency Act.”

The letter raises concerns that HHS has “left open the possibility that it will make payments to health insurance companies under the risk corridor program without seeking additional funding from Congress.”

Sessions and Upton ask Burwell to kindly provide them with HHS’s independent legal analysis on the matter, as well as with a list of the funding sources from which it believes it has the authority to cough up the cash on demand. I do so wonder if the White House will bother to get around to it this time, or even pretend to care about providing legal justifications for what basically amounts to them making things up as they go along.

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David Strom 8:31 AM on October 02, 2022