On Thursday, the Trump administration announced that it plans to kill Obamacare subsidies that enable low-earners to get affordable health care. Experts think the abrupt termination of the cost-sharing reduction payments (CSRs) could send the insurance market into chaos.
Even though President Trump has strongly opposed Obamacare, he agreed to keep the federal money flowing into the insurance marketplace after taking office. However, since the U.S. Congress hasn’t appropriated the money, the White House said it can no longer legally make the payments.
The White House accused the Obama administration of abusing tax dollars and skirting the federal law just to prevent a “broken system” from collapsing. The Trump administration urged Congress to roll back the “disastrous Obamacare” and find a replacement.
Insurers weren’t sure whether the federal government would make the payments this fall. The announcement ends the speculation. However, the decision could push premiums up, force people out of health insurance, and cost the U.S. government an extra $2.3 billion.
It was not immediately clear when the subsidies would be cut off.
Hill Democrats’ Reaction
Democratic leaders blasted the decision, calling it a move “a spiteful act of vast, pointless sabotage.” Senate Minority Leader Sen. Chuck Schumer and House Minority Leader Nancy Pelosi criticized Trump for “singlehandedly” raising the premiums instead of making health care affordable.
Schumer and Pelosi predicted that the President will try to place the blame for the decision on the failings of Obamacare, but they are confident he would pay the price for it.
In July, Trump threatened to kill the subsidies in a tweet urging congressmen to repeal Obamacare.
If a new HealthCare Bill is not approved quickly, BAILOUTS for Insurance Companies and BAILOUTS for Members of Congress will end very soon!
— Donald J. Trump (@realDonaldTrump) July 29, 2017
CSRs are essential for Obamacare to remain functional, but Republicans have been threatening to end them since 2014 when they sued the Obama administration for making the payments despite being unconstitutional.
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