Breaking: House of Representatives Files Amicus Brief in Risk Corridor Litigation

Originally published by Josh Blackman.

Today the House of Representatives filed an amicus brief, objecting to the proposed settlement in the risk corridor litigation. Here is their introduction.

The law is clear that insurance companies operating on the health exchanges established pursuant to the Patient Protection and Affordable Care Act have no right to government handouts in excess of incoming funds under the Act’s risk corridors program. This is because the program was intended to be budget-neutral and self-funding – i.e., outgoing payments would be covered by incoming payments – and Congress has confirmed this intent, not once but twice, through annual appropriations legislation. The Constitution provides in unambiguous terms that “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law,” U.S. Const. art. I, § 9, cl. 7, and Congress has repeatedly exercised its constitutional authority to bar the payments at issue here.

The Department of Justice (“DOJ”) knows that insurers have no right to excess payments. In later-filed cases brought by other insurers seeking excess payments, DOJ moved to dismiss for failure to state a claim on the ground that the Department of Health and Human Services (“HHS”) has no obligation to make risk corridors payments in excess of program receipts. But DOJ has inexplicably failed to apprise this Court of those arguments and of the controlling precedents that mandate dismissal of Plaintiff Health Republic Insurance Company’s complaint.2 HHS, for its part, is apparently bent on paying insurers despite the absence of any legal obligation to do so. Allegedly in light of a non-existent “litigation risk,” HHS recently took the extraordinary step of urging insurers to enter into settlement agreements with the United States in order to receive payment on their meritless claims. In other words, HHS is trying to force the U.S. Treasury to disburse billions of dollars of taxpayer funds to insurance companies even though DOJ has convincingly demonstrated that HHS has no legal obligation (and no legal right) to pay these sums. The House strongly disagrees with this scheme to subvert Congressional intent by engineering a massive giveaway of taxpayer money.

Particularly in light of Plaintiff’s recent motion for class certification in this case, DOJ’s troubling failure to raise these arguments here should not deprive this Court of the opportunity to consider these compelling grounds for dismissal of Plaintiff’s claims, so as to resolve this case in a manner that is consistent with binding precedent and avoids the unnecessary expenditure of judicial resources.

I will write more about this case in due time.

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.

from Texas Bar Today http://ift.tt/2dTi143
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