Sasse introduces bill to penalize HHS for short-changing taxpayers through the Affordable Care Act’s reinsurance program

Legislation recently introduced by U.S. Sen. Ben Sasse (R-NE) would penalize the Department of Health and Human Services (HHS) for prioritizing insurance companies through the Affordable Care Act’s reinsurance program.

The Affordable Care Act’s transitional reinsurance program was designed to stabilize insurance premiums for high-cost individuals using contributions made by insurance issuers and third-party administrators on behalf of self-insurance group plans.

“HHS must stop cheating taxpayers,” Sasse said. “The reinsurance program is a clear case of Washington’s cronyism: families are suffering Obamacare’s consequences but Washington bureaucrats are sending billions of dollars to well-connected insurance companies. Our legislation is simple: if HHS ignores the law to reward insurance companies, Congress will slash their operating budget. HHS must follow the law.”

Under the law, the HHS secretary was required to deposit a total of $5 billion from 2014-2016 into the Treasury, but that hasn’t happened. In 2014, the Treasury should have received $2 billion in general fund payments from HHS but received nothing while insurance companies received $8 billion. In 2015, HHS said that it would deposit $500 million of the required $2 billion into the Treasury while giving insurers $7.7 billion.

Under the Taxpayers Before Insurers Act, S. 2803, introduced by Sasse, HHS’s general department management fund would be cut in half unless the secretary deposits the full amount taxpayers are owed through the reinsurance program.

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