Minnesota health plans see big hit from frozen U.S. payments

Minnesota's health plans may take a big financial hit because of a federal decision to freeze some payments authorized under the Affordable Care Act.

The federal government's decision to put so-called risk adjustment payments on hold comes after a New Mexico federal district court decision earlier this year.

The Centers for Medicare and Medicaid Services announced over the weekend that it would freeze the payments.

Officials said the New Mexico court decision effectively bars the federal government from collecting or making payments under the current formula.

Minnesota Council of Health Plans president Jim Schowalter said the decision was "ridiculous," and said the freeze will likely raise premiums.

The payment freeze will affect people who buy non-group insurance or have coverage as an employee of a small business.

"Right now it means uncertainty for everybody," Schowalter said. "It means that what's going to happen for rates and options which seemed pretty stable and predictable are now up for another round of questions."