The subsidies are integral to insurers continuing to participate on the individual marketplaces.
President Trump is holding out the cessation of the CSR subsidies as a way to “Repeal & Replace” by causing the ACA to “implode”.
The subsidies reimburse insurers for reducing deductibles, co-payments and other out-of-pocket costs that low-income people pay when they visit doctors, fill prescriptions or receive care in hospitals.
The nonpartisan Congressional Budget Office has now quantified the cost of the threats, and potentially handed Democrats a weapon to force Congress and the administration to keep the money flowing. Premiums for the most popular health insurance plans would shoot up 20 percent next year, and federal budget deficits would increase by $194 billion in the coming decade if the subsidies are ended.
Read “The Effects of Terminating Payments for Cost-Sharing Reductions” released by the CBO today.
Read more in The New York Times
Congress has never appropriated the billions of dollars to fund the CSR payments. The House of Representatives sued the Obama administration for sending the money to insurers, saying it is unconstitutional. A federal judge agreed, and an appeal has been in limbo since Trump took office.
Sen. Lamar Alexander (R-Tenn.) and Sen. Patty Murray (D-Wash.) are working on a bipartisan bill that will appropriate the funds. It is not clear whether the House would cooperate with that approach.
Read more in Modern Healthcare