Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 1 of 15
`
`Receipt number AUSFCC-7293440
`
`IN THE UNITED STATES COURT OF FEDERAL CLAIMS
`
`ALLIANT HEALTH PLANS, INC.
`
`Plaintiff,
`
`v.
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`21-1769 C
`No. ____________
`
`
`
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`
`
`
`Defendant.
`____________________________________)
`
`THE UNITED STATES OF AMERICA,
`
`COMPLAINT
`
`Plaintiff Alliant Health Plans, Inc. (“Plaintiff” or “Alliant”) brings this action against
`
`Defendant, the United States of America (“United States,” or “Government”), and alleges the
`
`following:
`
`INTRODUCTION
`
`1.
`
`Alliant brings this action to recover amounts that the Government owes Alliant
`
`under the Government’s mandatory cost-sharing reduction (“CSR”) payment obligations
`
`established by Section 1402 of the Patient Protection and Affordable Care Act, Pub. L. 111-148,
`
`124 Stat. 119 and its implementing federal regulations.
`
`2.
`
`In March 2010, the United States enacted The Patient Protection and Affordable
`
`Care Act, Pub. L. No. 111-148, and The Health Care and Education Reconciliation Act, Pub. L.
`
`No. 111-152 (collectively, the “ACA”).
`
`3.
`
`The ACA requires individuals to purchase coverage if they are not otherwise
`
`insured, but also created a support system of federal subsidies to offset the costs of coverage. The
`
`ACA’s individual mandate, coupled with the availability of federal subsidies, was designed to
`
`realize the ACA’s twin goals of increasing both the availability and affordability of health
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 2 of 15
`
`
`
`insurance coverage. Together, they dramatically increased the number of individuals – many
`
`previously uninsured – purchasing health insurance. To help serve the vastly expanded pool of
`
`individuals seeking coverage, the ACA also established health insurance exchanges – online
`
`marketplaces where individuals and small groups may purchase health insurance. Created by Title
`
`I, Subtitle D of the ACA, the health insurance exchanges are designed to bring together buyers and
`
`sellers of insurance, with the goal of increasing access to coverage offered in a competitive
`
`marketplace.
`
`4.
`
`Health insurance issuers selling insurance on the exchanges are required to offer
`
`qualified health plans in the individual and small group markets. A qualified health plan (“QHP”)
`
`is a health plan that meets certain criteria established by the Centers for Medicare & Medicaid
`
`Services (“CMS”) in order to be sold to consumers through the exchanges.
`
`5.
`
`The ACA classifies plans offered on the exchanges in one of four levels – silver,
`
`gold, platinum, and bronze – based on their cost-sharing requirements: the coinsurance,
`
`copayments, and deductibles a policyholder must pay out-of-pocket until satisfying a maximum in
`
`a benefit year1 as established by regulation. 42 U.S.C. § 18022(d); 45 C.F.R. § 156.130.
`
`6.
`
`A “silver” plan is a plan structured so that the insurer pays approximately 70% of
`
`the average enrollee’s health care costs, leaving the enrollee responsible (before the application of
`
`the subsidy) for the other 30% through cost sharing. 42 U.S.C. § 18022(d). Under the ACA, an
`
`insurer must reduce cost sharing for eligible individuals enrolled in “silver” plans through an
`
`exchange. Id. § 18071(c)(2).
`
`
`1 A “benefit year” is “a calendar year for which a health plan provides coverage for health
`benefits.” 45 C.F.R. § 155.20.
`
`
`
`2
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 3 of 15
`
`
`
`7.
`
`In a “gold” or “platinum” plan, the insurer bears a greater portion of health care
`
`costs, while under a “bronze” plan, the insurer is responsible for a lower portion of those costs. Id.
`
`An insurer that offers coverage on an exchange is required to offer at least one plan at both the
`
`“silver” and “gold” levels of coverage. Id. § 18021(a)(1)(C)(ii). The ACA does not require insurers
`
`to reduce cost sharing for individuals enrolled in “gold,” “platinum,” or “bronze” plans.
`
`8.
`
`To realize the goal of making affordable health insurance available to low- and
`
`moderate-income Americans, the ACA, among other things, established an integrated program of
`
`subsidies to defray both the premium expenses and out-of-pocket costs of health insurance with
`
`two main components: premium tax credits and cost-sharing reductions.
`
`9.
`
`First, Section 1401 of the ACA provides premium tax credits for qualified
`
`individuals with household incomes between 100% and 400% of the federal poverty level who
`
`purchase health insurance through the exchanges. 26 U.S.C. § 36B. Because these tax credits are
`
`refundable, they can subsidize insurance purchased by individuals who have no income tax
`
`liability. See Congressional Budget Office (“CBO”), Refundable Tax Credits at 1 (Jan. 2013),
`
`available
`
`at
`
`https://www.cbo.gov/sites/default/files/113th-congress-2013-
`
`2014/reports/43767_RefundableTaxCredits_2012_0_0.pdf. The vast majority of individuals who
`
`buy insurance on an exchange rely on advance payments of these premium tax credits. See King
`
`v. Burwell, 135 S. Ct. 2480, 2493 (2015).
`
`10.
`
`Second, and most pertinent here, Section 1402 of the ACA requires insurers to
`
`provide “cost-sharing” reductions to individuals who are enrolled on a silver plan on the exchanges
`
`and whose household income is below 250% of the federal poverty level. 42 U.S.C. § 18071(c)(2),
`
`(f)(2). As noted above, “cost-sharing” refers to out-of-pocket payments to health care providers in
`
`the form of copayments, coinsurance, and deductibles that individuals are typically required to pay
`
`
`
`3
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 4 of 15
`
`
`
`under their insurance plan. See CBO, Key Issues in Analyzing Major Health Insurance Proposals
`
`at 15-17 (Dec. 2008), available at www.cbo.gov/publication/41746.
`
`11.
`
`Insurers, in turn, are guaranteed by the ACA to be reimbursed by the Government
`
`for the cost-sharing reductions they provide to their insureds. Specifically, the ACA requires that
`
`the Secretaries of Health and Human Services (“HHS”) and the Treasury “shall make periodic and
`
`timely payments to the [QHP] issuer equal to the value of the reductions.” 42 U.S.C. § 18071
`
`(emphasis added). These advance payments are made directly to health insurance issuers. Id. §
`
`18082(a)(3).
`
`12.
`
`Alliant insures individuals and groups within Georgia under the bronze, silver,
`
`gold, and platinum plans.
`
`13.
`
`Federal and state regulations do not permit health plans, such as Alliant, to raise
`
`premiums mid-benefit year (as opposed to prospectively) to cover the cost of providing the cost-
`
`sharing reductions.
`
`14.
`
`In an October 12, 2017 memorandum, HHS Acting Secretary Eric Hargan informed
`
`CMS that “CSR payments to issuers must stop, effective immediately.”2 According to the
`
`memorandum, this instruction was premised upon a legal opinion of the U.S. Attorney General
`
`concluding that the CSR program lacked a valid appropriation.
`
`15.
`
`The Government’s failure to pay CSR reimbursements deprives QHP issuers,
`
`including Alliant, of money to which they are entitled by statute on account of their performance
`
`in the exchanges for benefit year 2017. CBO estimated CSR payments of approximately $7 billion
`
`
`2 Oct. 12, 2017 Mem. from E. Hargan to S. Verma re Payments to Issuers for Cost-Sharing
`Reductions (CSRs), available at https://www.hhs.gov/sites/default/files/csr-payment-memo.pdf.
`4
`
`
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 5 of 15
`
`
`
`for fiscal year 2017.3 Regardless of whether Congress appropriated sufficient funds to HHS to
`
`make the CSR payments, the Government’s statutory obligation to make such payments, and
`
`Alliant’s right to those payments, remains.
`
`16.
`
`This identical issue has been litigated successfully by other QHP issuers. Those
`
`issuers sued the Government alleging that they were entitled to damages because the Government
`
`had failed to reimburse them for cost-sharing reductions they made in the final months of 2017.
`
`Their lawsuits made their way to the United States Court of Appeals for the Federal Circuit, where
`
`the Federal Circuit sided with the QHP issuers, holding that “the cost-sharing-reduction
`
`reimbursement program imposes an unambiguous obligation on the government to pay money and
`
`that the obligation is enforceable through a damages action in the Court of Federal Claims under
`
`the Tucker Act[.]” Sanford Health Plan v. United States, 969 F.3d 1370, 1372-73 (Fed. Cir. 2020);
`
`Cmty. Health Choice, Inc. v. United States, 970 F.3d 1364, 1367 (Fed. Cir. 2020) (“In these cases,
`
`following our decision in Sanford, we affirm the Claims Court's decisions as to liability. As
`
`in Sanford, we conclude that the government is not entitled to a reduction in damages with respect
`
`to cost-sharing reductions not paid in 2017.”).
`
`17.
`
`The Government petitioned the U.S. Supreme Court for a writ of certiorari, which
`
`the Court denied on June 21, 2021. See ME Com. Health Options v. United States, No. 20-1162,
`
`2021 WL 2519118 (U.S. June 21, 2021), and United States v. ME Com. Health Options, No. 20-
`
`1432, 2021 WL 2519119 (U.S. June 21, 2021).
`
`
`3 See CBO, Federal Subsidies Under the Affordable Care Act for Health Insurance Coverage
`Related to the Expansion of Medicaid and Nongroup Health Insurance: Tables from CBO’s
`January
`2017
`Baseline
`at
`4,
`available
`at
`https://www.cbo.gov/sites/default/files/recurringdata/51298-2017-01-healthinsurance.pdf.
`5
`
`
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 6 of 15
`
`
`
`18.
`
`Accordingly, by this lawsuit, Alliant seeks full payment of the CSR payments it is
`
`entitled to under the ACA and that the Government currently owes. Pursuant to the Federal
`
`Circuit’s decisions in Sanford Health and Community Health Choice, the law is clear, and the
`
`Government must abide by its statutory obligations. Alliant respectfully asks the Court to compel
`
`the Government to do so.
`
`JURISDICTION AND PARTIES
`
`19.
`
`This Court has jurisdiction over this action under the Tucker Act, 28 U.S.C. §
`
`1491(a)(1). The statutory cause of action giving rise to this Court’s Tucker Act jurisdiction is
`
`Section 1402, a money-mandating statute that requires payment from the federal government to
`
`QHP issuers that satisfy certain criteria. Section 156.430 is a money mandating regulation that
`
`implements Section 1402 and thus also obligates payment from the federal government to QHP
`
`issuers that satisfy certain criteria. See 45 C.F.R. § 156.430.
`
`20.
`
`In the alternative, the Contract Disputes Act (“CDA”), 41 U.S.C. §§ 7101 et seq., a
`
`money-mandating statute, provides Alliant a cause of action that gives rise to this Court’s
`
`jurisdiction pursuant to the Tucker Act.
`
`21.
`
`This controversy is ripe because HHS has refused to pay Alliant the full amounts
`
`owed for CSRs as required by Section 1402, Section 153.460, and the parties’ implied-in-fact
`
`contract.
`
`22.
`
`Alliant is a non-profit corporation organized and existing under the laws of the State
`
`of Georgia. Alliant offers Qualified Health Plans under the ACA in Georgia. Alliant is a QHP
`
`issuer as defined in 45 C.F.R. § 155.20 (previously defined as an “Issuer”).
`
`
`
`6
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 7 of 15
`
`
`
`23.
`
`The Defendant is the Government, acting through CMS (or CMS’s parent agency
`
`HHS). Unless otherwise noted, references in this Complaint to CMS include HHS where
`
`applicable.
`
`FACTUAL ALLEGATIONS
`
`The ACA’s Cost-Sharing Reduction Program
`
`24.
`
`The ACA imposed certain obligations on the federal government to help incentivize
`
`the participation of private insurers, stabilize premiums, and induce the uninsured to purchase
`
`health insurance coverage. Relevant to this dispute, the ACA established a cost-sharing reduction
`
`subsidy, paid preemptively to certain qualified insurers, to facilitate the core statutory mission of
`
`providing affordable health care to low- and moderate-income Americans.
`
`25.
`
`Section 1402 of the ACA, as codified at 42 U.S.C. § 18071, created the CSR
`
`program. In relevant part, that Section states:
`
`(a) In general. In the case of an eligible insured enrolled in a qualified health
`plan –
`
`(1) the Secretary shall notify the issuer of the plan of such eligibility;
`and
`
`(2) the issuer shall reduce the cost-sharing under the plan at the level
`and in the manner specified in subsection (c).
`
`[ . . . ]
`
`(c)(3) Methods for Reducing Cost-Sharing
`
`(A) In general. An issuer of a qualified health plan making
`reductions under this subsection shall notify the Secretary of such
`reductions and the Secretary shall make periodic and timely
`payments to the issuer equal to the value of the reductions.
`
`See 42 U.S.C. § 18071 (emphasis added).
`
`26.
`
`HHS implemented the CSR payments in the Code of Federal Regulations at 45
`
`C.F.R. § 156.430. In relevant part, Section 156.430 states that “[a] QHP issuer will receive periodic
`
`
`
`7
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 8 of 15
`
`
`
`advance payments based on the advance payment amounts calculated in accordance with §
`
`155.1030(b)(3) of this subchapter.” (emphasis added). Section 155.1030(b)(3) and other
`
`regulations set forth the calculation methodologies applicable to CSR payments.
`
`27.
`
`Following the ACA’s implementation, the Government established a CSR
`
`reimbursement schedule under which the Government would provide the required periodic
`
`advance payments to QHP issuers. See 42 U.S.C. § 18082; 45 C.F.R. § 156.430(b)-(d). The
`
`reimbursements are then periodically reconciled to the actual amount of cost-sharing reductions
`
`made to enrollees and providers. 45 C.F.R. § 156.430(c). Specifically, CMS established “a
`
`payment approach under which HHS would make monthly advance payments to issuers to cover
`
`projected cost-sharing reduction amounts, and then reconcile those advance payments at the end
`
`of the benefit year to the actual cost-sharing reduction amounts.”4 “After the close of the benefit
`
`year, QHP issuers must submit to HHS information on the actual value of the cost-sharing
`
`reductions provided” and HHS “would then reconcile the advance payments and the actual cost-
`
`sharing reduction amounts.”5 Finally, the Government would reimburse the QHP issuer “any
`
`amounts necessary to reflect the CSR provided or, as appropriate, the issuer [would] be charged
`
`for excess amounts paid to it.”6
`
`
`4 CMS, HHS Notice of Benefit and Payment Parameters for 2014 (Mar. 11, 2013), at 7, available
`at https://www.cms.gov/CCIIO/Resources/Files/Downloads/payment-notice-technical-summary-
`3-11-2013.pdf.
`5 Id.
`6 CMS, Manual for Reconciliation of the Cost-Sharing Reduction Component of Advance
`Payments for Benefit Years 2014 and 2015 (Mar. 16, 2016), at 28, available at
`https://www.cms.gov/CCIIO/Resources/Regulations-and-
`Guidance/Downloads/CMS_Guidance_on_CSR_Reconciliation-
`for_2014_and_2015_benefit_years.pdf; see also 45 C.F.R. 156.430(e).
`8
`
`
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 9 of 15
`
`
`
`Alliant Participated in Exchanges and Set Prices in Reliance on the Cost-Sharing
`Reduction Payments
`
`28.
`
`For QHP issuers to participate on the marketplaces for the 2017 benefit year, they
`
`had to submit their premiums to the appropriate state or federal regulatory authority during May
`
`2016 and submit a signed Qualified Health Plan Issuer Agreement (“QHPIA”) to CMS by the end
`
`of September 2016.7 Alliant timely submitted a signed QHPIA, and by doing so committed itself
`
`to offering health insurance coverage on the exchange for benefit year 2017. Because the QHPIA
`
`has limited termination rights, and because terminating the QHPIA under any circumstance does
`
`not obviate the issuer’s obligations under state law to continue coverage for enrollees who
`
`purchased the plan, Alliant’s commitment to the 2017 marketplace was effectively irrevocable as
`
`of the end of September 2016.8
`
`29.
`
`Alliant committed itself to participating in the marketplace in 2017 with the express
`
`understanding – based on the plain text of Section 1402 and the Government’s actions in previous
`
`benefit years – that, for those plans that required the issuers to reduce cost-sharing obligations of
`
`the enrollee, the Government would honor the statutory mandate of periodic and timely payments
`
`to the issuer equal to the value of the reductions. And in fact, in accordance with that
`
`understanding, the Government made monthly advance payments from January 2014 up and until
`
`October 2017. It was not until October 12, 2017 – over a year after Alliant had committed itself
`
`irrevocably to the 2017 exchange – that the Government first announced that it would not make
`
`CSR payments for the remainder of the 2017 benefit year.
`
`
`7 CMS, Key Dates for Calendar Year 2016: QHP Certification in the Federally-facilitated
`Marketplaces; Rate Review; Risk Adjustment and Reinsurance (Dec. 23, 2015), available at
`https://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/Final-2016-key-
`dates-table-April-2016.pdf.
`8 See 45 C.F.R. § 147.106(b).
`
`
`
`9
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 10 of 15
`
`
`
`Appropriations for Cost-Sharing Reduction Reimbursements
`
`30.
`
`Section 1401 of the ACA added a new section to the Internal Revenue Code that
`
`provided eligible insureds with premium tax credits to cover their health insurance premiums. 26
`
`U.S.C. § 36B. The ACA also amended 31 U.S.C. § 1324, which establishes a permanent
`
`appropriation of “[n]ecessary amounts . . . for refunding internal revenue collections as provided
`
`by law,” including “refunds due from” specified provisions of the tax code. 31 U.S.C. § 1324.
`
`Specifically, Section 1401 of the ACA amended the list in Section 1324 to include “refunds due
`
`from” Section 36B. 26 U.S.C. § 36B. Until October 2017, the Government relied on the
`
`appropriation in Section 1324 to pay amounts owed under both Sections 1401 and 1402.
`
`31.
`
`In its April 2013 budget request to Congress for fiscal year 2014, the Office of
`
`Management and Budget (“OMB”) included a request for a line-item appropriation designating
`
`funds for the payment of cost-sharing reductions. See Fiscal Year 2014 Budget of the United States
`
`Government, Appendix at 448 (Apr. 10, 2013). The same day, HHS separately submitted its
`
`justification to Congressional Appropriations committees stating that “CMS requests an
`
`appropriation in order to ensure adequate funding to make payments to issuers to cover reduced
`
`cost-sharing in FY 2014.” See HHS, Fiscal Year 2014, CMS, Justification of Estimates for
`
`Appropriations Committees at 184 (Apr. 10, 2013).
`
`32.
`
`Congress did not provide the line-item appropriation requested by HHS. See S. Rep.
`
`No. 113-71, 113th Cong. at 123 (July 11, 2013). Congress never repealed or amended the CSR
`
`provision, however, and the October 2013 legislation references the existence of CSR
`
`reimbursements. See Continuing Appropriations Act, 2014, Pub. L. No. 113-46, Div. B, § 1001(a),
`
`127 Stat. 558, 566 (Oct. 17, 2013) (requiring HHS to certify that a program was in place to verify
`
`
`
`10
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 11 of 15
`
`
`
`that applicants were eligible for “premium tax credits . . . and reductions in cost-sharing” before
`
`“making such credits and reductions available”).
`
`33.
`
`In January 2014, HHS began making monthly advance payments to reimburse QHP
`
`issuers for cost-sharing reductions,9 relying on Section 1324 as the appropriation for these
`
`payments.10
`
`34.
`
`Congress has never included any language in appropriations or other bills
`
`preventing HHS, CMS, or the Treasury from assessing certain funds or accounts to make CSR
`
`payments.
`
`The Government’s Refusal to Reimburse CSRs
`
`35.
`
`Although the Government continued to make CSR reimbursements for most of
`
`2017, it decided in October 2017 to stop doing so, arguing that 31 U.S.C. § 1324 could not be used
`
`to fund CSR reimbursements. The Department of Justice concluded that Section 1401 premium
`
`tax credits and Section 1402 CSR reimbursements were two distinct programs, and the permanent
`
`appropriations in Section 1324 only provided funding for the Section 1401 premium tax credits.
`
`See Oct. 11, 2017 Ltr. from Att. Gen. Sessions to Secretary of Treasury and Acting Secretary of
`
`HHS. The next day, HHS announced that it would stop making CSR reimbursements “until a valid
`
`
`9 See CMS, Manual for Reconciliation of the Cost-Sharing Reduction Component of Advance
`Payments for Benefit Years 2014 and 2015 (Mar. 16, 2016), at 27 (“Payments to issuers of
`estimated monthly
`amounts
`began
`in
`January
`2014.”),
`available
`at
`https://www.cms.gov/CCIIO/Resources/Regulations-and-
`Guidance/Downloads/CMS_Guidance_on_CSR_Reconciliation-
`for_2014_and_2015_benefit_years.pdf.
`10 See Letter from Sylvia M. Burwell, Dir., OMB, to Senators Ted Cruz and Michael S. Lee, at
`Responses p. 4 (May 21, 2014), (“cost-sharing subsidy payments are being made through the
`advance payments program and will be paid out of the same account from which the premium tax
`credit portion of
`the advance payments for
`that program are paid”), available at
`http://www.cruz.senate.gov/files/documents/Letters/20140521_Burwell_Response.pdf.
`11
`
`
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 12 of 15
`
`
`
`appropriation exists.” Oct. 12, 2017 Mem. from E. Hargan to S. Verma re Payments to Issuers for
`
`Cost-Sharing Reductions (CSRs).
`
`Alliant Has Suffered Substantial Harm as a Result of the Government’s Refusal to Pay
`Amounts Owed
`
`36.
`
`Alliant has suffered financial loss from the Government’s actions. Alliant was owed
`
`monthly CSR reimbursements in October – December 2017 that have not been paid. Pursuant to
`
`the calculation methodologies in Section 155.1030(b)(3) and other applicable regulations, Alliant
`
`is owed $1,635,826.79 in unpaid CSR reimbursements for 2017.
`
`37.
`
`Nonetheless, Alliant was still required by law to provide cost-sharing reductions to
`
`eligible insureds, despite not receiving the mandated reimbursement from the Government. This
`
`has caused Alliant to suffer significant financial losses.
`
`COUNT ONE
`
`Violation of Statutory and Regulatory Mandate to Make Payments
`
`38.
`
`Alliant re-alleges and incorporates paragraphs 1 through 37 of the Complaint as if
`
`set forth fully herein.
`
`39.
`
`The Government is obligated under Section 1402 of the ACA and/or 45 C.F.R. §
`
`156.430 to pay issuers of QHPs the applicable cost-sharing reductions mandated by the ACA.
`
`40.
`
`Alliant is an eligible QHP issuer under the ACA, and based on its adherence to the
`
`ACA and its notification of cost-sharing reduction amounts to CMS, satisfied the requirements for
`
`payment from the Government under Section 1402 of the ACA and 45 C.F.R. § 156.430.
`
`41.
`
`The Government has failed to perform as it is obligated under Section 1402 of the
`
`ACA and 45 C.F.R. § 156.430.
`
`
`
`12
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 13 of 15
`
`
`
`42.
`
`The Government’s failure to provide timely payments to Alliant is a violation of
`
`Section 1402 of the ACA and 45 C.F.R. § 156.430, and Alliant has suffered $1,635,826.79 in
`
`damages in payments for benefit year 2017 as a result of the Government’s actions.
`
`COUNT TWO
`
`Breach of Implied-in-Fact Contract
`
`43.
`
`Alliant re-alleges and incorporates paragraphs 1 through 37 of the Complaint as if
`
`set forth fully herein.
`
`44.
`
`Alliant entered into a valid implied-in-fact contract with the Government regarding
`
`the Government’s obligation to make full and timely CSR payments to Alliant in exchange for its
`
`agreement to become a QHP issuer and participate in the health insurance exchanges.
`
`45.
`
`Section 1402 of the ACA, HHS’s implementing regulations, the Government’s
`
`actions in making CSR payments for benefit years 2014, 2015, 2016 and nine months of 2017, and
`
`the actions of agency officials with authority to bind the Government regarding their obligation to
`
`make CSR payments constitute a clear and unambiguous offer by the Government to make full
`
`and timely CSR payments to health insurers, including Alliant, that agreed to participate as QHP
`
`issuers in the ACA marketplaces. This offer evidences a clear intent by the Government to contract
`
`with Alliant.
`
`46.
`
`Alliant accepted the Government’s offer by agreeing to become a QHP issuer,
`
`accepting the obligations, responsibilities, and conditions the Government imposed on QHP
`
`issuers under the ACA, and proceeding to provide health insurance on the exchanges. Alliant
`
`satisfied and complied with its obligations and conditions that existed under the implied-in-fact
`
`contract.
`
`
`
`13
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 14 of 15
`
`
`
`47.
`
`The Government’s agreement to make full and timely CSR payments was a
`
`significant factor material to Alliant’s decision to participate in the health insurance exchanges.
`
`48.
`
`The parties’ mutual intent to contract is further confirmed by the parties’ conduct,
`
`performance, and statements following Alliant’s acceptance of the Government’s offer, and the
`
`Government’s repeated assurances that full and timely CSR payments would be made.
`
`49.
`
`The implied-in-fact contract was also supported by mutual consideration: the
`
`CSR’s reimbursement to alleviate the financial requirement that QHP issuers were forced to bear
`
`under the ACA was a critical consideration that significantly influenced Alliant’s decision to
`
`become a QHP issuer and participate in the exchanges. Alliant, in turn, provided a real benefit to
`
`the Government by agreeing to become a QHP issuer and participating in the exchanges, as
`
`adequate insurer participation was crucial to the Government achieving the overarching goal of
`
`the ACA exchange programs – to guarantee the availability of affordable, high-quality health
`
`insurance coverage for all Americans by protecting consumers from increases in premiums.
`
`50.
`
`The Government induced Alliant to participate in the health insurance exchanges
`
`in part by including the CSR payments in Section 1402 of the ACA and its implementing
`
`regulations, by which the Government committed to make health insurers whole financially for
`
`the mandated cost-sharing reductions.
`
`51.
`
`The Government repeatedly acknowledged its commitments to provide financial
`
`assistance to QHP issuers and its obligations to make full and timely CSR payments to qualifying
`
`issuers through its conduct and statements to the public and to Alliant, which were made or ratified
`
`by representatives of the Government who had express or implied actual authority to bind the
`
`Government.
`
`
`
`14
`
`

`

`Case 1:21-cv-01769-TMD Document 1 Filed 08/27/21 Page 15 of 15
`
`
`
`52.
`
`The Government’s failure to make full and timely CSR payments to Alliant is a
`
`material breach of the implied-in-fact contract, and Alliant has suffered damages of $1,635,826.79
`
`for benefit year 2017.
`
`PRAYER FOR RELIEF
`
`Wherefore, Alliant requests the following relief:
`
`A.
`
`That the Court award Alliant monetary relief in the amounts to which Alliant is
`
`entitled under Section 1402 of the ACA and 45 C.F.R. § 156.430; to wit, $1,635,826.79, principal;
`
`B.
`
`That the Court award pre-judgment and post-judgment interest at the maximum rate
`
`permitted under the law;
`
`C.
`
`That the Court award such court costs, litigation expenses, and attorneys’ fees as
`
`are available under applicable law; and
`
`D.
`
`That the Court award such other and further relief as the Court deems proper and
`
`Respectfully submitted,
`
`MORRIS, MANNING & MARTIN, LLP
`
`
`
`
`
`
`
`
`
`/s/ Eric A. Larson
`Eric A. Larson
`1600 Atlanta Financial Center
`3343 Peachtree Road, N.E.
`Atlanta, Georgia 30326
`(404) 233-7000
`(404) 365-9532 (fax)
`elarson@mmmlaw.com
`
`Attorney for Plaintiff
`
`just.
`
`Dated: August 27, 2021
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`15
`
`