Consumers seek voice in ACA subsidies case

Gavel and flag in courtroom
Two consumers are seeking to either officially or “permissively” intervene in the House v. Burwell case, which could affect some ACA subsidies. Image: Getty/AlexStar

Two consumers are asking a federal appeals court to let them fight a ruling that, if allowed to stand, would halt funding for one type of Affordable Care Act subsidies.

The individuals—Gustavo Parker and La Trina Patton—filed their motion (PDF) Tuesday in the U.S. Court of Appeals for the District of Columbia Circuit. They are seeking to either officially or “permissively” intervene in the House v. Burwell case, which hinges on whether House Republicans are correct in their claim that the federal government is illegally allocating funds to the cost-sharing reduction (CSR) program that reimburses insurers for subsidizing individual market premiums.

A federal judge ruled in favor of the plaintiffs in May, and the Obama administration has since appealed. But after Donald Trump’s election, the appeals court stayed the case, allowing the new administration to decide how it wants to move forward.

Parker and Patton argued that an agreement between Trump’s administration and the House, to either dismiss the appeal or settle the case, will “produce devastating consequences” for individuals like them who receive CSRs and the healthcare system as a whole.

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

CSR recipients could see early termination of the 2017 policies, their motion said, since the federal government “permits insurers to leave the exchanges in the event cost-sharing reimbursement payments cease.” Indeed, in a clause in this year’s qualified health plan contract, the Centers for Medicare & Medicaid Services said it “acknowledges that the issuer could have cause to terminate this agreement subject to applicable state and federal law.”

And after 2017, insurers are “highly likely” to leave the marketplaces to avoid the obligation to pay unreimbursed CSRs, threatening the affordability and availability of health insurance in years to come, they argued.

Parker and Patton are not the only ones to express concern about what will happen to the individual marketplaces once Trump takes power, given his promise to repeal and replace the ACA. Healthcare industry groups including America’s Health Insurance Plans have warned against the possibility of instability and uncertainty in the wake of an ACA repeal.