Trump tweet hints at ending Obamacare insurance bailouts
Washington, US - US President Donald Trump threatened to end key Affordable Care Act (ACA) subsidies to health insurance companies that help make insurance accessible to poorer Americans, a move that may critically destabilise health exchanges if it went ahead.
The administration has previously floated the idea to halt subsidies that help insurers offset health-care costs for low-income Americans, called a cost-sharing reduction, or CSR. In a tweet on Saturday, Trump hinted at ending that programme.
‘If a new HealthCare Bill is not approved quickly, BAILOUTS for Insurance Companies and BAILOUTS for Members of Congress will end very soon!’ the President said in a tweet on Saturday.
It was unclear if Trump’s message means he also plans to directly target subsidies that are available to health insurance policies for some Congressional staff members. Thousands of members of Congress and staff are enrolled in plans on the Washington, DC, insurance exchange. The White House declined to comment further on Trump’s tweet.
A months-long effort by Senate Republicans to pass healthcare legislation collapsed early on Friday after Republican John McCain of Arizona joined two of his colleagues to block a stripped-down Obamacare repeal bill. McCain’s ‘no’ vote came after weeks of brinkmanship and after his dramatic return from cancer treatment to cast the 50th vote to start debate on the bill earlier in the week. The ‘skinny’ repeal bill was defeated 49-51, falling just short of the 50 votes needed to advance it. Republicans Susan Collins of Maine and Lisa Murkowski of Alaska also voted against it.
Ending the CSR subsidies, paid monthly to insurers, is one way that Trump could hasten Obamacare’s demise without legislation, by prompting more companies to raise premiums in the individual market or stop offering coverage. The administration last made a payment about a week ago for the previous 30 days, but hasn’t made a longterm commitment.
Responding to Trump’s earlier tweet on Saturday, Andrew Slavitt, acting administrator of the Centers for Medicare and Medicaid Services in the Obama administration, said the impact of cutting off subsidy payments ‘will be felt by the middle class who will pay more to subsidise low income’.
The next payments are due August 21. On Friday, health-care analyst Spencer Perlman at Veda Partners LLC said in a research note that there’s a 30 per cent chance Trump will end CSR payments, which may ‘immediately destabilise the exchanges, perhaps fatally’.
America’s Health Insurance Plans, a lobbying group for the industry, has estimated that premiums would rise by about 20 per cent if the CSR payments aren’t made. Many insurers have already dropped out of Obamacare markets in the face of mounting losses, and blamed the uncertainty over the future of the cost-sharing subsidies and the individual mandate as one of the reasons behind this year’s premium increases.
Moments after the Senate voted down the Republican bill on Friday morning, McConnell called on Democrats to offer their ideas for moving forward with health care. But he warned: “Bailing out insurance companies, with no thought of any kind of reform, is not something I want to be a part of.”
A survey in April by the nonpartisan Kaiser Family Foundation showed that 61 per cent Americans believe Trump and Republicans are responsible for future problems with the ACA, while 31 per cent said president Barack Obama and Democrats would be at fault.