Sen. John Barrasso and Rep. Liz Cheney praised President Donald Trump for pulling the plug on what they called illegal payments to insurance companies, which were used to help low-income Americans pay health care costs.
While a spokesman for Sen. Mike Enzi called the payments unlawful, it’s unclear whether the senator supports Trump’s move. The spokesman did not respond to follow-up questions.
The move was one of two Trump made last week that will likely change the complexion of the health care landscape, taking the matter into his own hands after congressional efforts to repeal and replace the Affordable Care Act stalled throughout the summer.
Before eliminating the payments on Thursday, Trump first signed an executive order rolling back insurance rules in an attempt to open the way for a greater number of relatively cheap health plans that could offer more limited coverage than allowed under the ACA.
Barrasso praised that decision, as well.
“I have always supported giving patients the freedom and flexibility to choose the health care plan that works best for them,” he said in a statement provided to the Star-Tribune.
Anne Ladd, the CEO of the Wyoming Business Coalition on Health, said the executive order is a way to undermine the federal health insurance exchanges established under the ACA. The order allows small businesses to form associations and buy plans through them. Currently, those businesses are not mandated to offer insurance to their employees, who may then obtain coverage through the exchange.
The associations allowed under the order could pull people away from the exchanges. However, those new plans could be skinny and “cover nothing,” Ladd said. That, in turn, could create more underinsured Americans, she said, who would then be on the hook for more out-of-pocket costs.
She suggested the order — which will remain somewhat unclear until rules and regulations are written by government agencies in the coming months — is part of a broader pattern to undermine the exchanges. That pattern includes cuts to advertising and personnel who promote and help consumers sign up for exchanges, she said.
Hours after he signed the executive order Thursday, the president announced that the government would cease to pay cost-sharing reductions to insurers, a move that could cause serious aftershocks to insurance markets across the country.
Currently, the health care law requires insurers to reduce costs for low-income people, and it specifies that the government must reimburse the companies. But Republicans and the Trump administration say the law failed to include a congressional appropriation, a specific instruction to pay that’s required by the U.S. Constitution before federal money can be spent.
After congressional Republicans filed a lawsuit challenging the legality of the payments in 2014, the issue has been winding its way through the courts. But in May 2016, a federal judge ruled in favor of the plaintiffs’ argument that Congress had never explicitly appropriated the dollars for the subsidies. That ruling has been appealed, and the payments have still been made month to month.
Barrasso, Cheney and a spokesman for Sen. Mike Enzi called the cost-sharing reductions unlawful.
“My focus remains on empowering patients to get the care they need — not funneling more taxpayer money to the insurance industry,” Barrasso said in his statement.
In her statement to the Star-Tribune, Cheney also took the opportunity to take a shot at the Senate, which was unable — over several attempts — to pass a health care reform bill. She laid the blame for those failings at the feet of Senate Democrats and “a handful of Republicans”: Sens. John McCain, Rand Paul, Susan Collins and Lisa Murkowski.
“They must all be held accountable,” she wrote.
The uncertainty surrounding the subsidies — and the broader health care system in America — has already had an effect: In August, Blue Cross Blue Shield — the sole provider on Wyoming’s state exchange — announced that it would likely raise premiums by 48 percent as a result of the uncertainty coming from Washington.
Blue Cross Blue Shield spokeswoman Wendy Curran said Monday that the insurance giant predicted the subsidies would be revoked and is reflected in the 48 percent increase.
She noted that people who have ACA plans will continue to receive subsidies to help pay for deductibles and co-pays; it’s insurers who will be losing the money they receive from the government.
Curran explained that while premium prices may be rising, the subsidies that patients receive to offset them — separate from the cost-sharing reductions insurers receive — will also rise. That’s because those subsidies are tied both to a person’s income and the price of the premium they pay.
But premium increases in states that did not expand Medicaid, including Wyoming, could be more significant because they have more people enrolled in the exchanges, the Kaiser Family Foundation wrote.
Ladd, the CEO of the business coalition, said that because those premium subsidies will increase, the cost to the taxpayer might also rise.
Around 90 percent of Wyomingites who receive ACA plans receive subsidies to offset premiums, and more than 50 percent of those people receive cost-sharing subsidies.
Curran added that Blue Cross Blue Shield has no intention of pulling out of Wyoming’s market, at least for the coming year. But nationally, the loss of the subsidies — which Trump has called a bailout for insurers — could cause insurance companies to back out of federal exchanges.
Eric Boley, the president of the Wyoming Hospital Association, was unable to comment Monday.
At the minimum, the loss of the cost-sharing funding will almost certainly mean that costs will go up for those on ACA exchange plans as insurers seek to replace the lost federal funding.
What further effect the changes will have on the market remains unknown, as are Trump’s future plans to change the law through executive action. Core tenants of the ACA remain in place, including the requirement that all Americans purchase insurance, the ability of states to expand Medicaid and that young Americans can remain on their parents’ policy until the age of 26.
The Associated Press contributed to this report.