Trump's move on House v. Burwell could collapse exchanges

White House

If Donald Trump's administration elects not to fight the House v. Burwell lawsuit, the Affordable Care Act marketplaces could quickly collapse.

On Trump’s first day in office, he could side with House Speaker Paul Ryan and end the bid by the Obama administration to fight a federal court ruling that would essentially end the cost-sharing reduction (CSR) program for millions of people who buy health insurance on the ACA exchanges, according to the Associated Press.

In House v. Burwell, Republican lawmakers challenged the legality of CSRs, arguing that the ACA doesn't actually provide the necessary appropriations for CSRs, as that funding requires congressional approval. 

Michael Cannon, a leading health policy official from the right-leaning Cato Institute, said he would advise Trump to stop fighting the lawsuit his first day in office, stipulating that the CSR payments stop at the end of 2017, the article noted. A spokeswoman from Ryan’s office told the AP he is reviewing the issue and that the office is working with the Trump transition team as it considers the House’s options.

If the CSR payments at stake in House v. Burwell are halted, payers would remain contractually obliged to provide subsidies to consumers, which could cost health insurers billions of dollars. In a previous court brief, insurers have said this could lead more of them to exit the marketplaces, the AP article added.

David Merritt, a spokesman for America’s Health Insurance Plans, told the AP that hastily throwing out the rules could mean lost coverage for people reliant on the law’s current statutes. “Big changes call for thoughtful transitions so that people aren’t harmed,” he said.

In May, a district judge ruled in favor of House Republicans in House v. Burwell. The Obama administration filed its initial appeal at the end of October, arguing that while disagreements over federal statues are routine, such disputes are to be resolved via “the give-and-take of the political processes.”