The small Boston insurer Minuteman Health is suing the federal government for the second time over the rollout of certain provisions of President Obama’s health care law.
Minuteman, launched in 2013, blames those provisions for making it difficult for the company to operate and grow.
In the latest suit, Minuteman says it is owed $5.5 million under the Affordable Care Act’s “risk corridor” program, which was designed to help stabilize health insurance markets. The government has paid only a fraction of these payments to Minuteman and other insurers because of a funding shortfall.
“One minute the federal government is promising to fulfill its requirements under the risk corridor statute. Then the government changes its mind and says it won’t,” Susan Brown, general counsel of Minuteman, said in a statement. “It is no wonder that premiums are going up in this unstable, unpredictable environment.”
Meanwhile, Minuteman is required to pay $16.7 million into the federal health law’s “risk adjustment” program, which redistributes money from insurers with healthier members to those with sicker members. The company filed a suit in July alleging that federal officials are using a flawed and illegal formula for calculating the payments, unfairly penalizing insurers like Minuteman that offer lower-cost plans.
The nonprofit insurer’s executives have long complained that these elements of the Affordable Care Act, or Obamacare, are hampering their ability to do business and have pushed federal officials to reform the programs.
Minuteman struggled with losses and lower-than-expected enrollment numbers when it began doing business three years ago, but its finances later stabilized. It has 7,227 members in Massachusetts and 19,482 in New Hampshire.Priyanka Dayal McCluskey can be reached at firstname.lastname@example.org. Follow her on Twitter @priyanka_dayal.