CMS puts hold on risk adjustment payments

The Centers for Medicare & Medicaid Services (CMS) on July 7 announced it would halt almost $10.5 billion in risk adjustment payments owed to certain insurance providers this fall for expenses incurred in 2017.

Risk adjustment is a permanent method built into the 2010 Affordable Care Act to help protect insurance providers from the ACA requirement that they accept all customers regardless of medical condition, without charging more to those who require extra medical care. CMS each year calculates which insurance companies with relatively low-cost consumers must pay into the risk adjustment fund and which ones with more expensive customers are owed money.

Insurers are upset over this decision and have said it will drive up health care premiums in 2019 for individuals and small businesses.

Read the risk adjustment report released by CMS on July 9.