Republican president could quash cost-sharing subsidies for ACA plans

Insurers that offer plans in the Affordable Care Act marketplaces must consider what will happen to cost-sharing subsidies if a Republican is elected president, according to an analysis published by the Wall Street Journal.

In the article, Juniper Research Group founder and CEO Chris Jacobs speculates that a GOP president could choose to stop the Treasury from making subsidy payments without express appropriation from Congress, which the Republican-controlled House has requested in a lawsuit filed against the Obama administration. Such a move could have the immediate effect of requiring insurers to cover qualifying enrollees without receiving the full subsidy to cover their increased costs, Jacobs writes.

Already, House Republicans have been pressing the Obama administration about cost-sharing reductions. This week, House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) and House Ways and Means Committee Chairman Kevin Brady (R-Texas) filed more subpoenas for documents regarding the cost-sharing reduction program, the lawmakers announced. The committee leaders say the administration's method of funding the subsidies--which have totaled more than $5 billion and are estimated to amount to approximately $170 billion over the next 10 years--is unconstitutional.

The Obama administration has responded by saying that a separate program subsidizing health insurance premiums gives it the necessary authority to spend funds on the cost-sharing subsidies, Jacobs notes.

Insurers are now weighing all these factors, especially with the 2016 election drawing closer, as they submit their premium rate requests for 2017. Already, some are seeking large premium increases, FierceHealthPayer has reported.

To learn more:
- read the WSJ article
- here is the lawmakers' announcement