Appeals Court Upholds ACA Risk Adjustment Methodology

The 10th Circuit Court of Appeals recently reversed a district court ruling that shot down CMS’ risk adjustment methodology for the 2014-2018 plan years. The lower court had ruled in New Mexico Health Connections v. HHS that HHS didn’t properly explain its budget-neutral formula. The appeals court disagreed, saying HHS did not violate the Administrative Procedure Act (APA) when it designed the Affordable Care Act risk adjustment program as budget neutral because it lacked funding to do otherwise. The...