Republicans Tried to Defund A Major Obamacare Program. Now The Supreme Court Says The Government Has To Pay Billions To Insurers
Two people stand at the base of the U.S. Supreme Court on March 16, 2020 in Washington, DC.
But in an 8-1 ruling released Monday, the court found that Congress created a legal commitment when it passed the ACA that Congress cannot renege on by refusing to cough up the money. The supposed trade-off was less government spending. But with Monday’s ruling, the government will end up paying insurance companies anyway, long after the damage is done. Some amount of the $12 billion will eventually make its way back to consumers in the form of rebates.
Most insurers underestimated costs and suffered losses. In 2014, the first year of the program, profitable insurers paid the government $362 million while the government owed unprofitable plans $2.87 billion, a net loss of $2.5 billion. Net losses totalled $5.5 billion the following year and $4 billion in the third and final year of the program.
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