By Jill Zorn
My blog written on February 1, Trumpcare: “If You Break It, You Own It”, assumed that Affordable Care Act (ACA) repeal, despite a certain amount of Republican disarray, was still very likely. At the end of the blog I also warned about “slow motion repeal”:
In the unlikely event that Republicans can’t quite bring themselves to pull the trigger on repeal, they are clearly implementing an alternative strategy of inaction and confusion that could have dire consequences for the ACA.
Now, in mid-April, while full, overt ACA repeal hasn’t yet happened, slow motion repeal is speeding up.
New regulations that hurt consumers
The Trump Administration’s goals remain muddled. On the one hand, they are still touting that they want to repeal the ACA. On the other hand, they just issued “market stabilization” regulations, that they claim will help shore up the health insurance marketplaces.
While their aims appear confused, one thing is clear: if they have to choose between insurers or consumers, they will choose insurers every time.
The new rules will make it harder for consumers to enroll in coverage and to keep that coverage. For example, in response to insurer complaints, the Trump Administration is making it harder for people to enroll mid-year. They say this is to keep people from gaming the system and only enrolling once they get sick.
Insurers hope that the new rules will keep sick people from enrolling. But one of the other regulation changes, shortening the annual open enrollment period, could just as easily keep many healthy people from enrolling. It seems the administration just can’t resist trying to keep enrollment numbers down, regardless of whether that hurts or helps the marketplaces.
Another regulation change will mean people enrolling in coverage will face higher co-pays and deductibles. This again shows the confused motivation of President Trump, who has repeatedly criticized the ACA’s high out of pocket costs. Yet his administration is now implementing regulations that will make them even higher.
To read more about the new rules and the many ways they can hurt consumers, read this Families USA blog post.
The ultimate sabotage: Refusing to fund Cost Sharing Reductions
The quickest way to explode the ACA would be to stop paying critical Cost Sharing Reduction (CSR) subsidies, which provide extra help to lower income ACA customers. On Monday, the administration promised to funding them. But on Tuesday, President Trump reversed that policy and threatened to stop paying them.
This one policy change alone, would lead to a 19% increase in premiums, cause many insurers to drop out of the marketplaces and would put the coverage of the 6 million people who rely on the subsidies at risk. The timing of this chaos is not good as insurers must decide very soon whether to participate in the marketplaces in 2018.
Refusing to pay cost sharing subsidies does not appear to make political sense. Some of the hardest hit states would be Republican strongholds that have higher percentages of low income people in their marketplaces because they never expanded Medicaid.
Even the US Chamber of Commerce, no friend of the ACA, supports payment of these subsidies. This week they signed a letter to President Trump along with other major stakeholders, asking him to maintain them.
Meanwhile, the April Kaiser Health Tracking Poll shows that three quarters of the American public, including a majority of Republicans, think “President Trump and his administration should do what they can to make the current health care law work.”
So why the reversal? Well, apparently “Let’s Make a Deal” Trump thinks that by holding these 6 million people hostage, he can force Democrats to come to the table to bargain with him on repealing and replacing the ACA.
He appears to be sorely mistaken. Instead, Democrats are insisting that funding for the subsidies be included in the federal budget continuing resolution, which must pass by the end of April to avoid a government shutdown.
So despite the passage of market stabilization regulations, the chaos surrounding the cost sharing subsidies, if it continues much longer, could lead to insurers fleeing from the ACA marketplaces and/or a government shutdown.
In short, as Jonathan Cohn of Huffington Post wrote this week:
They could do so through some combination of neglect and sabotage ― and it could all start more quickly than most people realize.