Bright, Friday Risk Adjustment Defaults Could Set Bad Precedent

Recently, CMS revealed that health insurers Bright Health Group, Inc. and Friday Health Plans Management Services Company, Inc., have failed to pay $1.1 billion that they owe to other health insurers through the Affordable Care Act’s risk adjustment program. While Friday will never be able to pay its share — since state regulators have taken over the failed insurer — the government’s repayment agreement with Bright is raising questions about whether the current rules governing ACA risk adjustment need an overhaul.

“Insurers that attract high-cost enrollees need to be able to count on being compensated by the risk adjustment system, and if they’re not going to be compensated, then insurers will be less willing to offer generous plan designs,” Matthew Fiedler, Ph.D., a fellow with the Brookings Schaeffer Initiative for Health Policy, tells AIS Health, a division of MMIT.

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Leslie Small

Leslie Small

Leslie has been reporting and editing in various journalism roles for nearly a decade. Most recently, she was the senior editor of FierceHealthPayer, an e-newsletter covering the health insurance industry. A graduate of Penn State University, she previously served in editing roles at newspapers in Pennsylvania, Virginia and Colorado.

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