Update: The White House has asked the court to delay the hearing again for 90 days. That doesn't give anyone in the industry much direction regarding the payments, but ensures they will continue for now.
- President Donald Trump told his staff last week he was considering withholding cost-sharing reduction (CSR) payments for insurers participating in the Affordable Care Act (ACA) exchanges in an effort to push Democrats to support the GOP plan to repeal the ACA, Politico reported.
- Refusing to provide the payments would almost certainly further destabilize the exchange market that is already reeling from payers saying they are pulling out of the exchanges because of financial losses and uncertainty surround CSRs.
- The White House is scheduled to update the court Monday on how it will proceed in the lawsuit House Republicans brought against President Barack Obama’s administration. It argued the CSRs were being illegally funded.
It's going to be a busy week for healthcare on Capitol Hill as senators continue to craft their version of an ACA replacement bill while also discussing congressional action to make sure insurers get their CSR payments.
Payers are anxiously awaiting any indication on the CSRs. Several have announced they are pulling out of exchange markets because of the uncertainty. Others have said the substantial increase in rates they are filing are also a result of not knowing about the future of the payments. Insurers have until late June to decide their exchange participation and rates.
Without continued CSR funding, premiums could rise by 19% or more for mid-level plans, according to the Kaiser Family Foundation. In an odd twist, this could end up costing the federal government more than paying the CSRs would. That’s because it would have to pay more in premium subsidies to people otherwise unable to afford coverage.
Trump seems to be betting that if the exchange markets collapse, Democrats will be forced to negotiate with Republicans as they try to push through the American Health Care Act. The bill that rolls back major parts of the ACA squeaked through the House but faces a tough road in the Senate. Trump has flirted with this tactic since he took office and even mentioned it on the campaign trail. But polls show that voters will blame Republicans if the healthcare situation gets worse and they mostly support improving the ACA instead of repealing it.
In the CSR lawsuit the White House on Monday sought further delay in the case, which includes the appeal remaining from the Obama administration. Major industry groups are pleading with the White House and Congress to do more ensuring the payments will continued. Last week, 16 Democratic attorneys general filed a motion to intervene in the lawsuit with the aim of preserving the payments.
Several organizations, including the American Medical Association, American Hospital Association and Americas Health Insurance Plans, sent a letter to leaders in Congress late last week asking them to “guarantee a steady stream of CSR funding through 2018.”
“Unless CSRs are funded, a tremendous number of Americans will simply go without coverage and move to the ranks of the uninsured,” they wrote. “This threatens not just their own health and financial stability, but also the economic stability of their communities.”
The Congressional Budget Office is expected to release a score for the updated bill Wednesday. The result will be important for procedural reasons and because it will offer another estimate for how many people would lose coverage with the bill. The first CBO score estimated 24 million people would lose their insurance, and that has left many moderate Republicans with cold feet as they face angry constituents during town halls at home.