Insurers Alter Obamacare Contracts Out Of Fear That Subsidies Could Be Struck Down

The Daily Caller reports:

Insurance companies bought into Obamacare exchanges with the promise that federal premium subsidies would convince more people to sign up, but they appear to be getting worried about pending lawsuits that could end the subsidies in federal exchanges.

According to insurance news service Inside Health Policy, insurance companies offering plans on HealthCare.gov this year had a new clause inserted into their contracts with Obamacare administrator the Centers for Medicare and Medicaid Services that allows them to cancel plans if federal premium subsidies are eliminated.

Forbes’ contributor and Obamacare subsidy expert Michael Cannon, who highlighted the change, argues that this could spark Supreme Court review of the legality of premium subsidies in federal exchanges.

The contract says that insurers’ participation in HealthCare.gov exchanges is “based on the assumption that [premium subsidies] and [other cost-sharing subsidies] will be available to qualifying Enrollees,” according to Forbes. “In the event that this assumption ceases to be valid during the term of this Agreement, CMS acknowledges that the Issuer could have cause to terminate this Agreement subject to applicable state and federal law.”

The messy world of ObamaCare.