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What you need to know about Highmark’s lawsuit

Highmark filed a lawsuit this week against the federal government to collect money that it claims the government failed to provide insurers as part of the Patient Protection and Affordable Care Act, the law known as Obamacare.

The money that Highmark is attempting to collect was promised to insurers for the calendar years 2014-2016 through what is known as the risk corridor program.

The government created the program to make funds available temporarily to insurers that were offering health plans through the ACA as they adjusted to a new market.

The goal was to provide insurers with back-up funding to help stabilize their ACA costs, since people insured under the ACA might have higher medical expenses.

The government never paid up, according to Highmark’s filing in the U.S. Court of Federal Claims.

Here are fast facts about the lawsuit:

Highmark wants $223 million for 2014

Highmark is attempting to collect nearly $223 million from the government, “less any prorated amounts actually paid by the government for calendar year 2014 alone,” according to the news release.

The government admitted that the money was owed and would be paid in full, yet the Centers for Medicare and Medicaid Services has only paid about $27.3 million toward the balance, according to Highmark.

The insurer has unsuccessfully tried to collect what it is owed, so it is filing the lawsuit.

Highmark estimates $500 million for 2015

Highmark recently reported an operating loss of more than $500 million in 2015, which it attributed to health plans offered under the ACA.

If the court determines that the government does, in fact, owe Highmark money for 2014, Highmark is also seeking the payments owed to it for 2015 on time and in full, according to the news release.

Other insurers have also sued

Highmark is not the first insurer to sue the government for not honoring the risk corridors program.

An Oregon-based health insurer, Health Republic Insurance, filed a similar lawsuit against the government in February, according to a local news sources.

That lawsuit was for about $500 million.

Highmark seeks to make ACA program sustainable

Highmark has been open about the fact that it’s losing millions to the ACA.

The insurer has consistently reported losses and creatively looked for ways to improve the government program to make it sustainable.

Highmark reduced the amount of plans offered through the ACA from 25 in 2014 to between eight and 10 plans in 2015.

In April, it reduced physician reimbursement rates for ACA members by 4.5 percent, and it has been in negotiations with disgruntled physicians over the pay cut.

Yet, despite the challenges, the insurer’s goal is to remain in the ACA market and continue serving people in ACA health plans , according to David Holmberg, president and CEO of Highmark Health.

Highmark currently has about 195,000 members insured through the ACA.

“It is essential we get the right premium rates, the right care delivery networks, and the right care management programs in place to stabilize the market so that it can sustain itself,” Holmberg said.

Lenay Ruhl

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