More than 50 Groups Urge Congress to Protect Taxpayers from Obamacare Bailouts

Michi Iljazi

October 13, 2016

Obamacare continues to cause problems for working families and the economy, as premiums continue to rise and consumers continue to find themselves with decreasing options. It is a law that was sold on a bill of goods that has turned out to be the opposite in every way, and things are likely to get worse with more rate increases on the horizon. Enrollment numbers are getting worse and it seems like each month we see another state-based exchange go under. There are so many problems with Obamacare that it is surprising to think it is still standing. One of the components of the President’s health care law is what is known as the Risk Corridor program. The Risk Corridor Program allows insurance companies to underwrite risky policies wouldn’t be covered otherwise, in turn making taxpayers responsible for risky policies. Due to massive losses, insurance companies want a bailout using the Risk Corridor program and while the law prohibits the use of money appropriated for the Fiscal Year 2016 to pay for the Risk Corridor program, that hasn’t stopped the Obama Administration from looking for alternative ways to get taxpayer money. This week, Taxpayers Protection Alliance (TPA) joined a coalition effort of more than 50 groups led by Freedom Partners Chamber of Commerce sending this letter urging Congress to protect taxpayers against any insurance company bailout through the Obamacare Risk Corridor program.

Read the full letter below. 

October 12, 2016

Dear Members of Congress:

Several years into its implementation, problems with the so-called Affordable Care Act (ACA) continue to mount. Families and businesses across the country face skyrocketing healthcare premiums and deductibles; they also face fewer insurance options as co-ops fail and insurance companies leave the health care exchanges.

On top of the billions in subsidies and the mandate that Americans buy insurance, the President’s health care law created several transitional programs intended to stabilize insurance markets and reduce insurance company risk during implementation, including the Transitional Reinsurance Program and the Risk Corridor Program. Insurance companies and the Obama administration are currently seeking to extend these programs and expand their scope.

The Transitional Reinsurance Program requires depositing $5 billion into the U.S. Treasury to offset the costs of Obamacare. Yet the Obama administration has failed to deposit a single dollar into the Treasury to date—instead, it has redirected these funds toward insurance companies experiencing greater-than-expected losses.

The Risk Corridor Program allows insurance companies to underwrite risky policies that they wouldn’t otherwise cover, putting taxpayers on the hook if the costs of a plan run higher than expected. This program has been overwhelmed by the magnitude of insurance company financial losses, leaving the budget-neutral program unable to provide all of the requested bailout money. Although current law prohibits the use of fiscal year 2016 appropriated funds to supplement the Risk Corridor Program, the Obama administration announced that it will seek to end the prohibition and open the risk corridor bailout spigot.

In classic fashion, the Obama administration has indicated intentions to work around Congress to get what it wants. In a Sept. 9 memorandum, the Center for Medicare and Medicaid Services said it is open to resolving baseless lawsuits filed by insurance companies seeking additional payments under the Risk Corridor Program. Through settlements, the administration could bypass Congress altogether and continue to misuse taxpayer dollars to pay for bailouts.

Thankfully, there are actions that Congress can take to stop this. The first is to recover the $5 billion illegally given to insurance companies through the reinsurance program by passing the Taxpayers Before Insurers Act (S. 2803, HR 5904), sponsored by Senator Sasse and Congressman Walker. The second is to prevent this from happening again — Congress should continue the budget neutrality provision in the risk corridor program, as well as pass legislation preventing the administration from using the “Judgment Fund” or any other taxpayer dollars to give money to insurers.

American households deserve better than to have their tax dollars go toward bailouts for insurance companies. Thank you for your attention to this important issue.


Mark Holden, Chairman, Freedom Partners Chamber of Commerce
Jim Martin, Chairman, 60 Plus Association
Don Irvine, Chairman, Accuracy in Media
Nick Sorrentino, Co-Founder,
Phil Kerpen, President, American Commitment
William H. Shaker, President, American Council for Health Care Reform
Sean Noble, President, American Encore
Gary L. Bauer, President, American Values
Wm. Brent Gardner, VP of Government Affairs, Americans for Prosperity
Grover Norquist, President, Americans for Tax Reform
Norm Singleton, President, Campaign for Liberty
Albert J. Lechner, Jr. President and CEO, Cause of Action
Andrew F. Quinlan, President, Center for Freedom and Prosperity
Jeff Mazzella, President, Center For Individual Freedom
Jim Backlin, Vice President of Legislative Affairs, Christian Coalition of America
David McIntosh, President, Club for Growth
Bill Walton, Chairman, Board of Directors, CNP Action, Inc.
Michael J. Bowen, CEO, Coalition For a Strong America
Tom Brinkman, Jr., Founder, Coalition Opposed to Additional Spending and Taxes
Jonathan Bydlak, President, Coalition to Reduce Spending
Stephen Moore, Co-Founder, Committee to Unleash Prosperity
Chip DeMoss, President and CEO, Compact for America
Gregory Conko, Executive Vice President, Competitive Enterprise Institute
Dan Caldwell, Vice President, Concerned Veterans for America
Penny Nance, President, Concerned Women for America
Neil Bradley, Chief Strategy Officer, Conservative Reform Network
Robert K. Fischer, Meeting Coordinator, Conservatives of Faith
Thomas Schatz, President, Council for Citizens for Against Government Waste 
David Bozell, President, For America
Tarren Bragdon, President and CEO, Foundation for Government Accountability
William Hillman, Chairman, Free Market America
Matt Kibbe, President, Free the People
Adam Brandon, President and CEO, Freedom Works
Andrew Clark, President, Generation Opportunity
Michael Needham, Chief Executive Officer, Heritage Action
Dan Perrin, President, HSA Coalition
Heather Higgins, President and CEO, Independent Women’s Voice
Seton Motley, President, Less Government
Daniel Garza, President, Libre Initiative
Gregory Angelo, President, Log Cabin Republicans
Harry C. Alford, President and CEO, National Black Chamber of Commerce 
Willes K. Lee, President, National Federation of Republican Assemblies
Brandon Arnold, Executive Vice President, National Taxpayers Union
Eli Lehrer, President, R Street
William Whipple, III, President, Secure America’s Future Economy
Teri Christoph, Co-Founder, Smart Girl Politics
David Williams, President, Taxpayers Protection Alliance
Judson Phillips, Founder, Tea Party Nation
Jenny Beth Martin, Co-Founder, Tea Party Patriots
C. Preston Noell, III, President, Tradition, Family, Property, Inc.
Beverly Gossage, President, HSA Benefits Consulting
Doug Badger, Health Policy Analyst and Former Presidential Advisor

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