President Donald J. Trump announced he’ll end cost-sharing reduction payments used to help cover costs for low-income individuals who purchase insurance on the Affordable Care Act’s individual market exchanges.
“The Democrats ObamaCare [sic] is imploding. Massive subsidy payments to their pet insurance companies has stopped. Dems should call me to fix!” President Trump tweeted Oct. 13.
Prior to the move, the federal government had been making payments on a month-to-month basis, but without any commitment that the payments would continue or for how long. That uncertainty has contributed to the rising premiums individuals are facing, according to insurers.
The action prompted criticism from medical organizations and health insurers alike.
In a statement , American Medical Association President David Barbe said he was “deeply discouraged” by the cuts. “This most recent action by the administration creates still more uncertainty in the ACA marketplace just as the abbreviated open enrollment period is about to begin, further undermining the law and threatening access to meaningful health insurance coverage for millions of Americans,” Dr. Barbe said.
“We need constructive solutions that increase consumer choice, lower consumer costs, and stabilize local markets,” America’s Health Insurance Plans and the Blue Cross Blue Shield Association said in a joint statement . “Terminating this critical program will do just the opposite. This action will make it harder for patients to access the care they need. Costs will go up and choice will be restricted.”
The U.S. Senate Committee on Health, Education, Labor & Pensions was working on a bipartisan, narrowly focused bill that would have, among other things, codified cost-sharing reduction payments in legislation for at least a year, after witnesses from across the political spectrum testified during four hearings that maintenance of the payments would bring stability to the individual market. That effort was derailed when Senate Majority Leader Mitch McConnell (R-Ky.) instead pushed a broad repeal-and-replace effort, which never reached the Senate floor for consideration when it was clear the action did not have enough votes to pass.
The president’s move follows an executive order that could further destabilize the individual market through broader use of association health plans and an expansion of short-term health insurance plans, neither of which would have to meet the coverage and benefits requirements of the Affordable Care Act.