The administration has a big decision on its hands right now: whether to continue a $7 billion Obamacare program that House Republicans say is illegal because Congress didn't authorize the spending.
Insurance plans really, really want to know what the White House plans to do on this particular program. But the administration isn't providing any clarity. Over the past 24 hours, it has sent reporters two statements that are difficult to parse — and
Why this Obamacare program matters a lot — and how Trump could end it. The health care law includes cost-sharing reductions
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These CSRs are in addition to premium subsidies, which are available to people up to 400 percent of the poverty line. They are meant to give even more help to the neediest Obamacare enrollees.
Trump has an easy way to end these
The Obama administration had vigorously pushed back against that argument, defending the subsidies in court. President Trump, however, could simply decide to drop the suit. He could agree that House Republicans are right that these subsidies are illegal, and his administration could the program.
Insurers say they need to know what Trump will do before they can decide to sell coverage on the Obamacare marketplaces next year.
"The uncertainty that has been fostered with the concerns about ... the continued and uninterrupted payment of cost-sharing reductions could do grievous harm to the individual market," Candy Gallagher, senior vice president of state policy at America's Health Insurance Plans, told regulators in a presentation.
So what will Trump do? An examination of two very confusing statements. An administration official released a statement to multiple news outlets Monday — including Vox and the New York Times — that said the Trump administration would continue this program so long as the lawsuit is pending. Here's what the statement said in full:
The precedent is that while the lawsuit is being litigated the cost-sharing subsidies will be funded. It would be fair for you to report that there has been no policy change in the current administration.
This sounds like the Trump administration plans to continue the program, at least when the lawsuit is active. But that left a key question unanswered: Does the Trump administration plan to continue defending the CSRs in court? I asked a spokesperson that question but never received an answer.
The New York Times reported on this statement with a story headlined "Trump Administration to Pay Health Law Subsidies Disputed by House." But the Department of Health and Human Services quickly threw cold water on that story, with a statement from spokesperson Alleigh Marré:
The New York Times report is inaccurate. The administration is currently deciding its position on this matter. We have not been contacted by Democrats to help save Obamacare, perhaps because they consider Obamacare to be a losing cause. Democrats need to help solve this failed Obamacare plan. The report was in reference to the current status of the lawsuit and is not an indication of what will happen in the future. No decisions have been made about how the administration will proceed.
So it seems like we're back at square one, without any clarity around what the Trump administration will do with these payments. The administration may still be figuring out its position (Politico has reported that the White House was divided, as of last week). Or the White House may have made a decision that it is not keen to advertise. (Headlines about continuing an Obamacare program are not great, after all, for an administration that supports dismantling the law.)
This is damaging to the Affordable Care Act. The uncertainty around the future of this program is making insurers skittish about signing up for the Obamacare markets. When two Iowa insurers pulled out of Obamacare last week, both cited the law's uncertain future.
Part of insurers' worry is about the CSR money itself — $7 billion is a lot! Premiums would rise an estimated 19 percent should those funds disappear.
But CSRs matter in a bigger way, too, that is about more than money. Insurance plans want to know whether the Trump administration plans to stabilize Obamacare — or, as the President has suggested, let it explode. The decision on CSRs will be a bellwether of which way the administration leans. Right now we just don't have a great indication of where this will land.