Trump Can Still Do a Lot of Damage, Despite the Chaos
WASHINGTON, May 20, 2017—Donald Trump is threatening to end vital Obamacare subsidy payments to get Democrats to the negotiating table on a new health care bill. This move could cause havoc in insurance markets, potentially triggering a spike in premiums and loss of coverage for millions of individuals.
Politico reports that Trump told aides that he wanted to end Obamacare subsidy payments to insurers at a Tuesday Oval Office meeting.
Under Obamacare, the government pays insurance companies a subsidy (about $7 billion for 2017) to help provide health care to low-income individuals by reducing premium deductibles and out-of-pocket costs. In the event that the government stops making these cost-sharing reduction payments (CSRs), under the current law, insurers are still responsible for providing coverage to low-income individuals. As a result, premiums would rise and insurers would be discouraged from participating in the exchanges next year, leading to loss of coverage for many of the poorest individuals.
In a statement obtained by Politico, the White House has committed to making payments until the end of May, but not thereafter. However, “no final decisions have been made at this time, and all options are on the table,” according to the statement.
The White House will have to make a decision by Monday, though. On Monday, the administration will have to inform the U.S. Court of Appeals for the District of Columbia how it wishes to proceed in a lawsuit pertinent to the subsidy payments, inherited from the Obama administration.
The 2014 suit, House v. Price, was brought by Republicans alleging that the Obama administration was making CSR payments without the required congressional appropriation. A federal court ruled in favor of Republicans, and the Obama White House appealed. Now, the Trump White House must tell the court whether it plans to continue the appeal or request a 90-day extension.
“A decision not to pay for cost-sharing reductions would throw the nation’s health care system into disarray, threatening care for millions,” says Cheryl Fish-Parcham,
director of Access Initiatives at Families USA, a nonprofit that advocates for affordable health care.
In a recent letter to senators, the U.S. Chamber of Commerce and some of the leading health care groups in the country warned of the consequences of ending the funding for cost-sharing reduction payments.
“Unless CSRs are funded, a tremendous number of Americans will simply go without coverage and move to the ranks of the uninsured,” they warn. “This threatens not just their own health and financial stability, but also the economic stability of their communities.”
It is unclear why Trump thinks that threatening to end these payments and imperil the health care of millions of Americans can be used as a bargaining chip against Democrats, since recent polls show that more Americans would blame Trump and the GOP congress should the health insurance markets collapse.
It is also easy to lose sight of other news in the wake of the numerous scandals the White House is facing, but this is one to keep an eye on.
Featured image:Matt Johnson, Flickr Creative Commons