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QUICK TAKE: Government Watchdog Rules Obamacare Bailout Efforts Illegal

In an important but barely-covered ruling, the GAO said Obama’s HHS violated the law with overpayments to struggling insurers under the Affordable Care Act.

The Affordable Care Act

On Thursday, auditors from the Government Accountability Office (GAO) ruled the Obama administration violated the law by overpaying insurers under the Affordable Care Act.

The New York Times explains:

At issue is a program that collects fees from most insurers and uses the money to help pay high-cost claims for sicker people. The purpose of this temporary “reinsurance program” is to stabilize premiums and to encourage insurers to participate in markets under the health care law.

The 2010 law stipulates that some of the money “shall be deposited into the general fund of the Treasury of the United States and may not be used for the program” to provide financial assistance to insurance companies.

The auditors found that the Obama administration had flouted this requirement.

Instead, because HHS collections fell billions short of what was expected, the Obama administration skipped the deposit of Treasury funds. They gave “almost all the money to insurers.”

HHS had argued that it was their authority to determine the allocatation of funds if collections fell short of $20 billion required over three years. GAO ruled, though, that the requirement for Treasury deposits was clear.

This is just the latest failure for Obamacare in 2016, its worst year yet. NTK has previously covered the struggling state exchanges, and consumer surveys indicating displeasure with the state of health care in America.