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Insurers Forced to Take Ryan White Funds for HIV Patients

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March 14 (Bloomberg) -- Insurers nationwide must allow people with HIV and AIDS to use money from the federal Ryan White program to pay their monthly premiums, the government said today in a regulatory filing.

The rule was announced after three Louisiana insurers and one North Dakota insurer said they would stop taking funds from the taxpayer-supported program. Blue Cross Blue Shield of Louisiana, the state’s largest insurer, stopped taking checks in January, prompting a lawsuit in federal court in Baton Rouge, Louisiana, claiming the insurers were rejecting funds so they wouldn’t have to cover HIV patients, who tend to be sicker and high utilizers of health care.

The Louisiana insurers agreed earlier this week to accept the payments until November. Both parties also agreed to a stay in court proceedings until the U.S. Centers for Medicare and Medicaid decided the issue.

Since major provisions of the Patient Protection and Affordable Care Act began in January, health coverage has been extended to millions of Americans, including those previously denied insurance because of pre-existing medical conditions. Insurers are concerned that a large percentage of patients now signing up will be older and sicker, forcing the companies to take on more risk.

The Ryan White program, named for a hemophiliac who died in 1990 at age 18 after being diagnosed with AIDS, provides HIV-related services to half a million Americans. More than 1,300 Louisiana residents have used the funds to apply for health plans under Obamacare, according to the Louisiana Department of Health and Hospitals.

Blue Cross Blue Shield of Louisiana said in February it was rejecting all third-party payments including those from the Ryan White program because of “the escalated potential for fraud and abuse” under Obamacare. Louisiana Health Cooperative Inc. and Vantage Health Plan Inc. also stopped accepting funding.

Blue Cross Blue Shield of North Dakota also didn’t accept Ryan White funding, but “will comply with Centers for Medicare and Medicaid Services directives,” Andrea Dinneen, a company spokeswoman, said in an e-mail before the rule was released.

To contact the reporter on this story: Caroline Chen in New York at

To contact the editors responsible for this story: Reg Gale at Andrew Pollack, James Callan

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