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Politics Trump will pull Obamacare subsidies in another attack on health law

06:19  13 october  2017
06:19  13 october  2017 Source:   vox.com

Trump to cut off key ObamaCare payments: report

  Trump to cut off key ObamaCare payments: report President Trump plans to cut off key payments to insurers selling ObamaCare coverage, Politico reported Thursday, citing two sources familiar with the matter.Such an action would represent Trump's most aggressive move yet to dismantle ObamaCare, after GOP efforts to repeal and replace the health-care law failed this year.Trump has repeatedly threatened to cut off the disbursements to insurers, known as Cost Sharing Reduction (CSR) payments. They are worth an estimated $7 billion this year, Politico noted.

The Trump administration has decided to cut off crucial Obamacare subsidies that help reduce health care costs for lower-income Americans, a serious attack on the stability of the health care law ’s insurance markets.

The Trump administration has decided to cut off crucial Obamacare subsidies that help reduce health care costs for lower-income Americans, a serious attack on the stability of the health care law ’s insurance markets.

  Trump will pull Obamacare subsidies in another attack on health law © Provided by Vox.com

The Trump administration has decided to cut off crucial Obamacare subsidies that help reduce health care costs for lower-income Americans, a serious attack on the stability of the health care law’s insurance markets.

President Trump has been threatening to end the payments — know as cost-sharing reduction subsidies or CSRs — for months, but is finally following through after Republicans in Congress once again failed to repeal and replace Obamacare late last month.

The White House announced late Thursday that the administration would stop the payments. The move comes as the Trump administration is also cutting funding for Obamacare outreach and pursuing new regulations to blow holes in the law, changes that collectively threaten a program through which millions of Americans purchase insurance.

Trump to halt 'massive' ObamaCare subsidies; legal fight likely

  Trump to halt 'massive' ObamaCare subsidies; legal fight likely President Trump plans to halt payments to insurers under the Affordable Care Act "immediately," in a major blow to ObamaCare that is likely to draw a legal challenge.  The president, though, used the overnight decision to up pressure on Democrats to negotiate a "fix" to the "imploding" health care law. "The Democrats ObamaCare is imploding. Massive subsidy payments to their pet insurance companies has stopped. Dems should call me to fix!" he said in a pre-dawn tweet on Friday.

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The cost-sharing payments, which were created as part of the health care law but were then the subject of a lawsuit from House Republicans, help compensate health insurers for lowering the copays and deductibles that their lower-income customers must pay.

A federal judge has found the payments to be illegal without any further congressional action. Both Republicans and Democrats in Congress have expressed an openness to funding the subsidies,which would remove Trump’s ability to nix them, but no action has yet been taken.

Some health insurers had already increased their premiums for Obamacare plans in 2018 by as much as 20 percent because of Trump’s threats to cut off the payments. A permanent end to the subsidies could imperil the law’s marketplaces in the long term and lead to even bigger price hikes in future years.

New York, California threaten to sue over health-care subsidies

  New York, California threaten to sue over health-care subsidies Attorneys general from California and New York say they are prepared to sue the Trump administration to protect health-care subsides that the White House said would be cut off. New York Attorney General Eric Schneiderman (D) said in a statement that hundreds of thousands of New York families rely on ObamaCare's subsidies for their health care.

Embed Tweet. Replying to @AnaKasparian. Subsidies were illegal. 2 replies 0 retweets 3 likes. Reply. These constant attacks are exhausting. It feels like he is fighting a war with the American people . 0 replies 0 retweets 1 like.

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Health plans could potentially sue the Trump administration to force the payments to be made, as they have on earlier occasions when Republicans sought to cut off federal funding provided under Obamacare. States have also taken steps to prepare for the possibility Trump would pull the payments, and most 2018 rates have already been finalized. So premiums might not be immediately affected any more than they already have been.

But Trump is nonetheless introducing even more uncertainty to Obamacare’s future. As Vox has covered in great detail, a lawsuit filed by House Republicans three years ago gave him that opening.

CSRs, a crucial piece of Obamacare, were the target of a GOP lawsuit

Under Obamacare, people who earn too much for Medicaid but are still low-income — up to 250 percent of the federal poverty line, about $30,000 for one person — receive cost-sharing reductions for their private insurance. The federal government makes those payments to the health insurer to lower the out-of-pocket costs, the deductible and copayments, that those people have to pay for their health care. The less money people make, the more help they receive.

GOP Rep. breaks with Trump: Cutting health care subsidies does 'opposite' of what he promised

  GOP Rep. breaks with Trump: Cutting health care subsidies does 'opposite' of what he promised A Republican lawmaker slammed President Trump's action on health care Friday.Rep. Ileana Ros-Lehtinen (R-Fla.) said that cutting key payments to ObamaCare insurers will mean more of her constituents will be uninsured.

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“When starting with prescription drugs we know the policy levers to pull . There’s continuing medical education and prescribing deadlines. Trump will pull Obamacare subsidies in another attack on health law from Dylan Scott.

More than half of people who buy individual insurance through Obamacare got this help. About 12 million people bought health insurance through Obamacare’s insurance markets this year, and 7 million of them qualified for CSRs, according to the Kaiser Family Foundation.

The impact is substantial: A person who doesn’t qualify for a CSR and buys a typical Obamacare plan could have to pay as much as $3,609 for a deductible before her plan starts to cover her health care. But a person who qualifies for the most generous CSR — whose income is at the poverty line or only a little above it — could have to pay only $255 before the coverage kicks in.

Last year, CSR payments cost the federal government $7 billion, which means that, on average, CSRs lowered out-of-pocket costs by about $1,000 for each person.

  Trump will pull Obamacare subsidies in another attack on health law © Provided by Vox.com Kaiser Family Foundation

Republicans targeted them in a 2014 lawsuit, arguing that though Obamacare had created the subsidies, Congress needed to approve them in a separate spending bill and had not done so before the Obama administration started making the payments. That made the payments unconstitutional, according to House Republicans.

Trump tweets about Obamacare 'imploding' after decision to halt subsidies

  Trump tweets about Obamacare 'imploding' after decision to halt subsidies President says Democrats should call him after his decision to stop Obamacare subsidies to insurance companies because he said the health care law is "imploding." Mr. Trump made the comment early Friday on Twitter, after announcing that he's halting the cost-sharing reduction (CSR) payments on Thursday night. The Democrats ObamaCare is imploding. Massive subsidy payments to their pet insurance companies has stopped. Dems should call me to fix!— Donald J.

Trump will pull Obamacare subsidies in another attack on health law – Vox.

Trump will pull Obamacare subsidies in another attack on health law – Vox.

The Obama administration argued that Obamacare had permanently funded the CSR payments and so it did not need any additional authority from Congress to make the payments. It also argued that regardless of the facts of the case, the House didn’t actually have the ability to bring a case because it wasn’t harmed by the cost-sharing reduction payments, a legal concept known as “standing.”

Rosemary Collyer, the judge hearing the case and a Republican appointee, first ruled in September 2015 that the House did in fact have standing to sue the administration over the payments. She then sided with the House in May 2016, deciding that the CSR payments could not be made without further congressional approval.

However, she suspended the decision so that the Obama administration could appeal, allowing the payments to continue until the case is fully resolved. The Obama administration appealed the ruling in July 2016 to the US District Court of Appeals in Washington. But litigation moves slowly, and the case didn’t advance much further in the next six months. Then Trump was elected.

Congress could approve the CSR payments, mitigating Trump’s move

Even without the CSR payments, insurers would still be required to reduce cost sharing, but they would now have to do it without the government’s help. They have said they will raise premiums dramatically to make up the lost revenue.

Trump kills key Obamacare subsidies: What it means

  Trump kills key Obamacare subsidies: What it means President Trump will no longer fund Obamacare's cost-sharing subsidies. Here's what that means.The administration announced late Thursday night that it would immediately stop supporting the cost-sharing subsidies that reimburse insurers for reducing the deductibles and co-pays of lower-income Obamacare enrollees. Trump has been paying the subsidies on a month-to-month basis, unnerving many insurers.

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The irony is that if plans do raise premiums, the federal government would be on the hook for much of those costs. The government absorbs premium increases through the tax credits that help people afford coverage. The law is designed to keep premiums manageable for people, so it falls on the government to cover any excess increases.

  Trump will pull Obamacare subsidies in another attack on health law © Provided by Vox.com Kaiser Family Foundation

Or, perhaps more likely, plans could eventually drop out of the market altogether.

The empty spots on Obamacare’s map have been filled in in recent weeks, but if insurers decide to leave the market, either now or later, thousands of Americans could be left without plan options as a result of Trump’s action.

“If I were an insurer, I’d just take my marbles with me and focus on other more profitable lines of business,” Larry Levitt at the Kaiser Family Foundation told me.

Health insurers could sue to force the federal government to make the payments, as they’ve done for other Obamacare funding streams plugged up by Republicans. Several industry sources indicated before Trump’s decision that would be a potential course for insurers to take, though no final decisions had yet been made.

But there is a quicker course to fix the issue. Congressional Republicans know the consequences of this move, and they have talked for months about approving the payments themselves and removing the risk that the White House would nix the CSRs and send the insurance market into chaos.

Now, following the failure of Senate Republicans to repeal the law, an increasing number of them are turning toward a bipartisan health care solution — one that is likely to include funding for CSRs. Top Senate Republicans and Democrats had neared an agreement on an Obamacare fix package which would fund the payments, but they have not yet finalized a deal that could be brought up for a vote.

But the underlying point is that if Congress were to act, Trump would no longer have the option to cut off the CSR payments as an attack on the health care law.

Some middle-class Americans worry Trump health subsidies cut will hurt .
Tom Westerman voted for Donald Trump in last year's election but says he might not do so again after the president cut off billions of dollars in Obamacare subsidies to health insurance companies. "It really upset me," said Westerman, 63, a self-described "middle-class guy" with an annual household income of about $60,000 in the western Pennsylvania city of Arnold.

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