Trump Team Could Pull the Plug on Obamacare Subsidies for 2018

Trump Team Could Pull the Plug on Obamacare Subsidies for 2018

J.M. Guyon - Copyright 2013

The Department of Health and Human Services on Tuesday seemed to walk back a promise that the Trump administration would continue paying health insurance subsidies that insurance companies serving the individual market through the Affordable Care Act’s health insurance exchanges rely on to balance the cost of serving patients that consumer a large amount of healthcare.

The administration, in a statement to The New York Times on Monday, had said that the plan was to continue paying the subsidies while courts adjudicate the claim, brought by Republicans in Congress, that the payments are illegal because they were not specifically authorized by the law.

Related: Under Pressure from Insurers, Trump Continues Obamacare Taxpayer Subsidies

As insurers try to determine whether they will participate in the exchanges next year, many were calling on the administration to provide some certainty about the subsidies -- something HHS appeared to do in a statement provided to the Times.

“The precedent is that while the lawsuit is being litigated, the cost-sharing subsidies will be funded,” the agency told the newspaper. “It would be fair for you to report that there has been no policy change in the current administration.”

However, on Tuesday afternoon, Vox Media’s Sarah Kliff reported that she had received a statement from HHS that challenged the Times report.

“The New York Times report is inaccurate,” said the statement, attributed to HHS spokesperson Alleigh Marré. “The administration is currently deciding its position on this matter. We have not been contacted by Democrats to help save Obamacare, perhaps because they consider Obamacare to be a losing cause. Democrats need to help solve this failed Obamacare plan. The report referred to the current status of the lawsuit and is not an indication of what will happen in the future. No decisions have been made about how the administration will proceed.”

Related: Insurer’s Message to Trump: Fix Obamacare or We’re Out

Late last month, House Speaker Paul Ryan had signaled that there would be no push from Congress to shut off the subsidies while the lawsuit was being resolved, a statement that the insurance industry saw as welcome but insufficient.

Without an ironclad guarantee that the subsidies would keep flowing, industry representatives said, insurers would be forced to raise premiums for the 2018 plan year to account for the uncertainty.

While the HHS statement to the times on Monday appeared to be aimed at creating that certainty, the statement Tuesday afternoon seems likely to have the exact opposite effect.