Major healthcare lobbying groups urge Trump, Congress to fund ACA subsidies

Dive Brief:

  • Seven major healthcare organizations, including the American Hospital Association, the American Medical Association and America's Health Insurance Plans, as well as the U.S. Chamber of Commerce urged the President Donald Trump administration and Congress "to take quick action to ensure [cost-sharing reductions] are funded" in a letter sent on Wenesday.
  • "The most critical action to help stabilize the individual market for 2017 and 2018 is to remove uncertainty about continued funding for cost sharing reductions (CSRs)," the letter states.
  • The Washington Post reported earlier on Wednesday that Trump wants to review ACA repeal before tackling tax reform.

Dive Insight:

Many of the major healthcare lobbying groups made clear what they want from Trump and Congress over the individual insurance market: A piece of mind that the subsidies will be funded.

Whether or not the HHS will continue to pay CSRs to insurers in light of House v. Price (formerly known as House v. Burwell) has been a bit unclear. The administration finds itself in a quandary with the lawsuit. Congressional Republicans had challenged the Obama administration in court over the legality of CSRs. Last year, a judge ruled in favor of the Republicans, but the Obama administration filed an appeal to reverse the decision and was allowed to continue the payments while the appeal is still in process. The suit began with Democrats in charge of the executive branch and with Republicans now in control, they need to decide how to proceed with the appeal while also working on healthcare reform.

The HHS issued a statement yesterday that didn't do much to help demystify the Trump administration's stance on the matter, calling a New York Times article that said the agency would continue CSR payments "inaccurate." "No decisions have been made about how the administration will proceed," the agency stated. 

While the current executive branch is right to be cautious on how it will proceed, time is not on their side as the month insurers' must decide on whether they will participate in the ACA exchange market – June – is quickly approaching. Insurers are unsure how to proceed in the market at this time. The administration has not made its plan clear and the industry awaits the final market stabilization rule. The proposed rule was released in February.

The authors of the letter don't want to wait around any longer and they shared why they view CSRs as important to the health of the market. "Nearly 60% of all individuals who purchase coverage via the marketplace – 7 million people – receive assistance to reduce deductibles, co-payments and/or out-of-pocket limits through CSR payments," they wrote. "This funding helps those who need it the most access quality care: low- and modest income consumers earning less than 250% of the federal poverty level."

They added that if CSRs are not funded, the decision will come with several consequences, such as:

  • Choices for consumers wil be more limited;
  • Premiums for 2018 and beyond will be higher;
  • If more people are uninsured, providers will experience more uncompensated care, which will further strain their ability to meet the needs of their communities and will raise costs for everyone, including employers who sponsor group health plans for their employees; and
  • Taxpayers will pay more, as premiums grow and tax credits for low-income families increase, than if CSRs are funded.  

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Filed Under: Policy & Regulation
Top image credit: White House