Trump’s path on Obamacare intersects with subsidy lawsuit
President-elect Donald Trump says he wants to preserve health insurance coverage even as he pursues repeal of the Obama-era overhaul that provided it to millions of uninsured people.
How his administration handles a pending lawsuit over billions of dollars in insurance subsidies will reveal whether Trump wants an orderly transition to a Republican-designed system or if he’d push “Obamacare” over a cliff. Stripping away the subsidies at issue in the case would put the program into a free-fall.
The question in the House v. Burwell case couldn’t be more technical: whether the Affordable Care Act specifically states in its hundreds of pages that the government can pay money to help reduce out-of-pocket costs for low-income consumers on HealthCare.gov and state insurance markets.
Those subsidies for deductibles and copayments are paid directly to insurers, on top of the law’s tax credits that reduce premiums for consumers. Since the ACA’s basic coverage is fairly skimpy, the cost-sharing subsidies make it work for millions of people when they seek treatment. For example, subsidies can bring a $1,500 hospital copayment down to $100.
House Republicans have taken the Obama administration to court. They argue that the law lacks a specific congressional “appropriation” for the subsidies, estimated to total $9 billion next year. A federal district judge in Washington, D.C., agreed with the House and the case is now on appeal.
The Obama administration has argued that the spending is automatically approved, or “appropriated,” under the law. Otherwise lawmakers would have designed a system that they knew wasn’t viable. More than half of health law customers are currently receiving cost-sharing subsidies.
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