Maine Community Health Options v. United States

The Affordable Care Act established the Risk Corridors program to limit insurers' profits and losses during the first three years of the health insurance exchanges (2014–2016). Under 42 U.S.C. § 18062, the Secretary of Health and Human Services "shall pay" eligible unprofitable plans. When insurers' losses exceeded revenues from profitable plans, creating a deficit of over $12 billion, Congress passed appropriations riders barring CMS from using funds for risk corridor payments. The government never paid. Several insurers sued in the Court of Federal Claims under the Tucker Act. The Federal Circuit ruled for the government, holding the riders impliedly repealed the payment obligation. The Supreme Court consolidated the cases and reversed.

The Supreme Court ruled 8-1 in favor of the insurers on April 27, 2020. Justice Sotomayor delivered the opinion. The Court held that § 1342's use of "shall pay" created a legal obligation; that the appropriations riders did not impliedly repeal the obligation; and that the insurers' claims were properly brought under the Tucker Act. The government was ordered to pay approximately $12 billion in unpaid risk corridor payments. Justice Alito dissented, arguing the majority inferred a private right of action not expressly created by Congress.

Whether the Risk Corridors statute created a government obligation to pay insurers the full amount calculated under § 1342's formula; whether Congress impliedly repealed that obligation through appropriations riders; and whether insurers could sue for damages under the Tucker Act in the Court of Federal Claims.

The decision affirmed that the government must honor statutory payment obligations even absent a specific appropriation, reinforcing the principle that the government should honor its commitments. It resolved billions of dollars in liability owed to health insurers, affecting the financial stability of plans that participated in the ACA exchanges. The ruling encouraged insurers to rely on statutory promises when participating in federal programs. It also clarified the limits of implied repeal in the context of appropriations riders, impacting future government contracting and statutory interpretation. The case was part of a broader wave of litigation over ACA risk corridor and cost-sharing reduction payments.