Feds say states can alter use of health subsidies
The Trump administration is urging states to tear down pillars of the Affordable Care Act, demolishing a basic rule that federal insurance subsidies can be used only for people buying health plans in marketplaces created under the law.
According to advice issued Thursday by federal health officials, states would be free to redefine the use of those subsidies, which have since 2014 provided the first help the government ever has offered consumers to afford monthly insurance premiums.
States could allow the subsidies to be used for health plans the administration has been promoting outside the ACA marketplaces that are less expensive because they provide skimpier benefits and fewer consumer protections.
Even more dramatically, states could let residents with employer-based coverage set up accounts in which they mingle the federal subsidies with health-care funds from their job or personal taxdeferred savings funds to use for premiums or other medical expenses.
If some states take up the administration’s offer, it would undermine the ACA’s central changes to the nation’s insurance system, including the establishment of nationwide standards for many kinds of health coverage sold in the United States.
Another goal of the ACA, the sprawling 2010 law that was President Barack Obama’s preeminent domestic accomplishment, was to concentrate help on the so-called individual insurance market that serves people who do not have access to affordable health benefits through a job.