ACA Risk Corridors: What They Are and How They Work

The Affordable Care Act (ACA) was passed in 2010 to provide health insurance coverage to millions of Americans who were previously uninsured. The law created a number of programs to help make health insurance more affordable, including risk corridors.

Risk corridors were designed to help health insurance companies manage the financial risk of insuring people with pre-existing conditions. Under the program, health insurance companies would pay a fee into a pool, and the government would then use that money to reimburse health insurance companies that had higher-than-expected costs.

The risk corridor program was in place from 2014 to 2016. During that time, health insurance companies paid a total of $12 billion into the pool. However, the government only reimbursed health insurance companies $3.7 billion, leaving a shortfall of $8.3 billion.

Several health insurance companies have filed lawsuits against the government, demanding that they be paid the full amount of the risk corridor payments that they are owed. In 2016, Blue Cross and Blue Shield of North Carolina filed a lawsuit demanding $129 million in unpaid payments. The case is still pending in court.

The risk corridor program was a key part of the ACA, and its failure has had a significant impact on the health insurance market. Health insurance companies have raised premiums in order to cover the losses they incurred under the program, and some health insurance companies have even exited the market altogether.

What Does the Failure of the Risk Corridor Program Mean for Consumers?

The failure of the risk corridor program has had a number of negative consequences for consumers. Health insurance premiums have increased, and some health insurance companies have exited the market, making it more difficult for consumers to find affordable health insurance.

In addition, the failure of the risk corridor program has made it more difficult for health insurance companies to cover people with pre-existing conditions. Health insurance companies are now more likely to deny coverage to people with pre-existing conditions, or they may charge them higher premiums.

What Can Consumers Do?

If you are concerned about the impact of the risk corridor program failure on your health insurance coverage, there are a few things you can do:

Shop around for health insurance. There are a number of different health insurance companies offering plans in your area. You can compare plans and prices to find the best deal.
Consider a health insurance subsidy. If you qualify, you may be eligible for a health insurance subsidy to help you pay for your health insurance premiums.
Seek out licensed agent assistance. Licensed agent can help you find the best health insurance plan for your needs and financial situation. Independent licensed agent operating outside of HealthCare.gov can also walk you through step-by-step over the phone and can even help with the enrollment.

The failure of the risk corridor program is a major setback for the ACA. However, there are still a number of ways to get affordable health insurance coverage. By shopping around and comparing plans, you can find the best deal on health insurance.