Trump to scrap sub­si­dies, hit­ting Oba­macare again

Honolulu Star-Advertiser - - NEWS - By Robert Pear, Mag­gie Haber­man and Reed Abelson

WASH­ING­TON >> Pres­i­dent Don­ald Trump will scrap sub­si­dies to health in­sur­ance com­pa­nies that help pay out-of-pocket costs of low-in­come peo­ple, the White House said late Thurs­day. His plans were dis­closed hours af­ter the pres­i­dent or­dered po­ten­tially sweep­ing changes in the na­tion’s in­sur­ance sys­tem, in­clud­ing sales of cheaper poli­cies with fewer ben­e­fits and fewer pro­tec­tions for con­sumers.

The twin hits to the Af­ford­able Care Act -— on suc­ces­sive days -— could un­ravel Pres­i­dent Barack Obama’s sig­na­ture do­mes­tic achieve­ment, send­ing in­sur­ance pre­mi­ums soar­ing and in­sur­ance com­pa­nies flee­ing from the health law’s on­line mar­ket­places. Af­ter Repub­li­cans failed to re­peal the health law in Con­gress, Trump ap­pears de­ter­mined to dis­man­tle it on his own. With­out the sub­si­dies, in­sur­ance mar­kets could quickly un­ravel. In­sur­ers have said they will need much higher pre­mi­ums and may pull out of the in­sur­ance ex­changes cre­ated un­der the Af­ford­able Care Act if the sub­si­dies are cut off. Known as cost-shar­ing re­duc­tion pay­ments, the sub­si­dies were ex­pected to to­tal $9 bil­lion in the com­ing year and nearly $100 bil­lion in the com­ing decade.

“The govern­ment can­not law­fully make the cost-shar­ing re­duc­tion pay­ments,” the White House said in a state­ment.

It con­cluded: “Con­gress needs to re­peal and re­place the dis­as­trous Oba­macare law and pro­vide real re­lief to the Amer­i­can peo­ple.”

In a joint state­ment, the top Democrats in Con­gress, Sen. Chuck Schumer of New York and Rep. Nancy Pelosi of Cal­i­for­nia, said Trump had “ap­par­ently de­cided to pun­ish the Amer­i­can peo­ple for his in­abil­ity to im­prove our health care sys­tem.” “It is a spite­ful act of vast, point­less sab­o­tage lev­eled at work­ing fam­i­lies and the mid­dle class in ev­ery cor­ner of Amer­ica,” they said. “Make no mis­take about it, Trump will try to blame the Af­ford­able Care Act, but this will fall on his back and he will pay the price for it.” Law­mak­ers from both par­ties have urged the pres­i­dent to con­tinue the pay­ments. Trump had raised the pos­si­bil­ity of elim­i­nat­ing the sub­si­dies at a White House meet­ing with Re­pub­li­can sen­a­tors sev­eral months ago. At the time, one se­na­tor told him that the Re­pub­li­can Party would ef­fec­tively “own health care” as a po­lit­i­cal is­sue if the pres­i­dent did so. “Cut­ting health care sub­si­dies will mean more unin­sured in my district,” Rep. Ileana Ros-Le­hti­nen, R-Fla., wrote on Twit­ter late Thurs­day. She added that Trump “promised more ac­cess, af­ford­able cov­er­age. This does op­po­site.”

But Speaker Paul D. Ryan, R-Wis., praised Trump’s de­ci­sion and said the Obama ad­min­is­tra­tion had usurped the author­ity of Con­gress by pay­ing the sub­si­dies. “Un­der our Con­sti­tu­tion,” Ryan said, “the power of the purse be­longs to Con­gress, not the ex­ec­u­tive branch.”

The fu­ture of the pay­ments has been in doubt be­cause of a law­suit filed in 2014 by House Repub­li­cans, who said the Obama ad­min­is­tra­tion was pay­ing the sub­si­dies il­le­gally. Judge Rose­mary M. Col­lyer of the U.S. District Court in Wash­ing­ton agreed, find­ing that Con­gress had never ap­pro­pri­ated money for the cost-shar­ing sub­si­dies. The Obama ad­min­is­tra­tion ap­pealed the rul­ing. The Trump ad­min­is­tra­tion has con­tin­ued the monthly pay­ments, even though Trump has made clear that he de­tests the pay­ments and sees them as a bailout for in­sur­ance com­pa­nies.

The de­ci­sion to end the sub­si­dies came on the heels of Trump’s ex­ec­u­tive or­der, which he signed ear­lier Thurs­day.


Pres­i­dent Don­ald Trump signed an ex­ec­u­tive or­der on health care Thurs­day in the Roo­sevelt Room of the White House.


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