By Christopher Snowbeck

Star Tribune

Three Minnesota health plans would collectively take a big financial hit nearly $72 million from the federal governments decision this weekend to halt risk adjustment payments under the federal Affordable Care Act.

But a fourth health insurer here would be spared a big payment of nearly $66 million.

On Saturday, the federal Centers for Medicare and Medicaid Services (CMS) cited a court decision earlier this year, saying the agency would halt financial transfers under the health law that shift money to insurers in certain markets that happen to cover people with expensive health conditions.

The money comes from carriers that happen to insure healthier consumers in the markets, and is one of several measures in the ACA that were designed to promote market stability so private insurers would compete.

As a result of this litigation, billions of dollars in risk adjustment payments and collections are now on hold, said CMS administrator Seema Verma, in a statement. CMS has asked the court to reconsider its ruling, and hopes for a prompt resolution that allows CMS to prevent more adverse impacts on Americans who receive their insurance in the individual and small group markets.

For 2017, Eagan-based Blue Cross and Blue Shield of Minnesota is due about $44.2 million in risk adjustment payments, according to a Star Tribune analysis of federal data. Minneapolis-based UCare is due $17.2 million, according to the analysis, while Minnetonka-based Medica would receive nearly $10.3 million.

Bloomington-based HealthPartners, however, was expecting to pay $65.8 million.

The national trade group for health insurers issued a statement Saturday saying the Trump administrations decision threatens the stability of health insurance markets. Risk adjustment is needed, the trade group said, because it helps make sure coverage is available for patient with costly medical problems by sharing those costs across all insurers.

It will create more market uncertainty and increase premiums for many health plans putting a heavier burden on small businesses and consumers, and reducing coverage options, said Americas Health Insurance Plans in a statement.

The risk adjustment program transfers funds among carriers in the individual market, which primarily serves people under age 65 who are self-employed or dont get coverage from an employer. It also applies to carriers in the market where small businesses buy coverage.

In a statement Saturday, CMS cited a February decision by the U.S. District Court for New Mexico that invalidated the use of the statewide average premium in the risk adjustment transfer formula established under the ACA, pending further explanation of why the government has been running the program in a budget neutral manner

The ruling prevents CMS from making further collections or payments under the risk adjustment program, including amounts for the 2017 benefit year, until the litigation is resolved, CMS said in the statement.

CMS said that because of a contrary decision on the issue by the U.S. District Court for Massachusetts, the government moved the New Mexico district court to reconsider its decision. The agency said the calculated risk adjustment transfer amounts for the 2017 benefit year are $10.4 billion, which includes transfers across catastrophic, small group, and individual non-catastrophic risk pools.