Trump To Make Obamacare Subsidy Payments After Threatening To End Them

President Donald Trump applauds with House Speaker Paul Ryan of Wis., behind him in the East Room of the White House, Wednesday, July 26, 2017, in Washington. Trump is announcing the first U.S. assembly plant for electronics giant Foxconn in a project that's expected to result in billions of dollars in investment in the state and create thousands of jobs. (AP Photo/Alex Brandon)
Alex Brandon/AP

A White House official confirmed to TPM on Wednesday that the Trump administration will make a multi-billion dollar payment to health insurers to subsidize coverage under the Affordable Care Act for about 18 million low-income people with severe health needs.

The monthly payment, which Trump has repeatedly threatened to cut off and which some Congress members have decried as a bailout, is due in late August. The decision comes just one day after the non-partisan Congressional Budget Office released a report showing that cutting off the cost-sharing reduction (CSR) payments would cause a spike in health insurance premiums across the individual market, and would increase the federal deficit by nearly $200 billion dollars.

As the Trump administration toys with ending the CSR payments, a pending lawsuit on the executive branch’s right to make payments remains in limbo. The ongoing uncertainty about the future of the payments, meanwhile, is already wreaking havoc in the insurance market, causing insurers to raise their rates or leave certain areas altogether.

To address this instability, Republican lawmakers have introduced bills that would take the decision out of President Trump’s hands by having Congress appropriate the funding for the CSRs for at least a year.

Sen. Lamar Alexander (R-TN), who chairs the committee in charge of health care, expressed relief that the president had made the August payment, but encouraged Congress to step in.

“State insurance commissioners have warned that abrupt cancellation of cost-sharing subsidies would cause premiums, copays and deductibles to increase and more insurance companies to leave the markets in 2018,” he said. “Congress should act before the end of September to keep insurance available at a reasonable cost during 2018.”

Masthead Masthead
Editor & Publisher:
Managing Editor:
Senior News Editor:
Assistant Editor:
Editor at Large:
Investigations Desk:
Front Page Editor:
Editor for Prime & Special Projects:
General Manager & General Counsel:
Executive Publisher:
Head of Product:
Director of Technology:
Publishing Associate:
Front-End Developer:
Senior Designer: