The ACA’s Risk Programs: Why Congress Needs to Prevent Insurer Bailouts

The Affordable Care Act (ACA) put in place three separate programs designed to mitigate some of the risks assumed by health insurers participating in the markets that are most significantly affected by the health care law. The three programs are reinsurance, risk corridors, and risk adjustment.

As a result of the ACA’s inherent flaws and questionable actions taken by the U.S. Department of Health and Human Services (HHS), two of these programs (reinsurance and risk corridors) could well cost taxpayers billions of dollars.

These three programs—reinsurance, risk corridors, and risk adjustment—expose the underlying failures of the ACA. Instead of bailing out the insurers with tax dollars through these programs, Congress should focus on repealing the regulations and provisions that are driving up the cost of coverage and creating dysfunctional health insurance markets.

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