Highmark Health Suing U.S. Government

PITTSBURGH (KDKA) -- One of the area's largest health insurance companies is suing the United States government alleging it failed to pay its share of Affordable Care Act claims.

Highmark Health says it's owed a lot of money for offering insurance under the Affordable Care Act, also known as Obamacare.

"We're owed over $500 million," said Highmark Health CEO David Holmberg.

KDKA's Jon Delano: "$500 million? Half a billion dollars?"

Holmberg: "Yes. So, think about it. If you're a small business owner and you've sold goods and services to somebody and they were supposed to pay you within a certain amount of time. And then all of a sudden they say, 'Yeah, I've consumed the goods and services, but I'm not in a position to pay you."

Holmberg says, under Obamacare, the federal government agreed to reimburse some of the costs of offering affordable insurance to the uninsured.

"There was no history on those people," Holmberg says. "So you really couldn't figure out what kind of diseases they might have, what kind of claims they might have, and consequently, what happened was, in order to participate in the program, the federal government agreed to share the risk of the unknown with insurance companies."

So in 2014, 2015 and 2016, the feds owe Highmark Health some of its expenses. In 2017, the company sets its own rates with no reimbursement.

On Tuesday, Highmark Health sued the feds for the $200 million it says it's owed in 2014, and says it will use any money it gets to help current subscribers.

Delano: "Are you looking to get out of Obamacare?"

Holmberg: "Our objective is to find a solution where the exchanges are another option for people to choose."

Holmberg says Highmark Health does not want to get out of the Obamacare market exchange but he does have a warning.

"Even for us, there's a point at which it doesn't make sense to move forward, so our goal is to figure this out and work with the administration to get it right," he said.

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