On Oct. 12, President Trump made good on threats to pull the cost-sharing subsidies that reimburse insurers for reducing out-of-pocket costs of lower- and moderate-income people with Obamacare insurance policies. Here's an update on what that means and what could happen because of it.
About 7 million people, 58 percent of all marketplace enrollees, got cost-sharing reduction (CSR) subsidies in 2017, which cost the government about $7 billion. Nearly 70 percent of these enrollees live in pro-Trump states and many have no other current insurance options. Insurers are still required by law to offer these plans in the markets they serve, but without CSRs, insurers will likely either hike rates or withdraw from some markets entirely, Hannah Recht reports for Bloomberg. Most of the counties that have only one Obamacare insurer are rural.
Most insurers feared Trump would end the subsidies and based their rates accordingly, Recht reports. Now his move may give them an exit clause. "Medica Health Plans recently exited North Dakota after state insurance
officials there would not accept Medica’s high-rate, no-CSR request, she writes. "With less than three weeks until open enrollment, we’ll be watching closely to see if other companies choose to leave."
The attorneys general for 17 states and the District of Columbia filed suit against Trump's administration in an effort to block the subsidy cut-off.
Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) have been working for months on a bill to give states more flexibility in implementing Obamacare and fund the subsidies, which are authorized by the law but have not received appropriations form Congress. President Obama used other means to pay them, but a court has ruled against that, and the case is on appeal.
About 7 million people, 58 percent of all marketplace enrollees, got cost-sharing reduction (CSR) subsidies in 2017, which cost the government about $7 billion. Nearly 70 percent of these enrollees live in pro-Trump states and many have no other current insurance options. Insurers are still required by law to offer these plans in the markets they serve, but without CSRs, insurers will likely either hike rates or withdraw from some markets entirely, Hannah Recht reports for Bloomberg. Most of the counties that have only one Obamacare insurer are rural.
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| In some places, nearly all policyholders get subsidies. (Bloomberg map; click to enlarge) |
The attorneys general for 17 states and the District of Columbia filed suit against Trump's administration in an effort to block the subsidy cut-off.
Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) have been working for months on a bill to give states more flexibility in implementing Obamacare and fund the subsidies, which are authorized by the law but have not received appropriations form Congress. President Obama used other means to pay them, but a court has ruled against that, and the case is on appeal.
Stephanie Armour reports for The Wall Street Journal, "Trump has privately told at least one lawmaker that the payments may continue if a bipartisan deal is reached on health care, according to people familiar with the matter on Capitol Hill and in the health-care industry." The next distribution of the subsidies was set for around Oct. 20, and the Department for Health and Human Services said they "will be discontinued immediately." Armour notes, "The administration is scheduled to update the court on the status of the case on Oct. 30."
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