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Trump to halt cost-sharing subsidies to insurers

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President Donald Trump has signed an executive order that aims to make lower-premium health care plans available to more Americans.
Time

President Trump plans to end payments to insurers that have helped low-income families pay for health insurance under the Affordable Care Act, the White House announced late Thursday.

In a statement, White House Press Secretary Sarah Huckabee Sanders said the decision was “based on guidance from the Department of Justice,” adding that the government “cannot lawfully make the cost-sharing reduction payments.”

“The bailout of insurance companies through these unlawful payments is yet another example of how the previous administration abused taxpayer dollars and skirted the law to prop up a broken system,” Sanders said in a statement. “Congress needs to repeal and replace the disastrous Obamacare law and provide real relief to the American people.”

Word of Trump’s plan came on a day when the president had signed an executive order directing government agencies to design insurance plans that would offer lower premiums outside the requirements of former president Barack Obama’s signature achievement.

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Trump’s decision is likely to trigger a lawsuit from state attorneys general, who contend the subsidies to insurers are fully authorized by federal law, and the president’s position is reckless.

Frustrated over setbacks in Congress, Trump is wielding his executive to bring the “repeal and replace” debate to a head. He appears to be following through on his vow to punish Democrats and insurers after the failure of GOP health care legislation.

On Twitter, Trump has termed the payments to insurers a “bailout,” and administration officials have questioned their legal authorization. It’s unclear if the president will get Democrats to negotiate by stopping payment.

Experts have warned that cutting off the money would lead to a double-digit spike in premiums, on top of increases insurers already planned for next year. That would deliver another blow to markets around the country already fragile from insurers exiting and costs rising. Insurers, hospitals, doctors’ groups, state officials and the U.S. Chamber of Commerce have urged the administration to keep paying.

Contributing: The Associated Press

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