Republicans in Congress may soon have to appropriate federal funds to insurers they fought to hold off for several years under Obamacare, or otherwise risk being blamed for a chain reaction of insurer exits and premium hikes.
President Trump is expected to issue a decision as early as Tuesday on whether his administration will continue to deliver these payments to insurers, known as cost-sharing reduction subsidies. If he chooses to end them, members of Congress have signalled that they may consider appropriating the funds.
"I hope the president will use his authority to extend those payments. He can do that," said Sen. John Thune, R-S.D., the No. 3 Senate Republican. "If he doesn't then Congress will have to look at what our options are."
Without the funds, insurers will look to exit the exchanges as quickly as they are able, resulting in people losing coverage. They alternatively will look to increase their premiums by about 20 percent.
The circumstances would play out differently depending on state laws; some state residents would not be able to buy coverage that is paid for in part through federal subsidies, while other residents would see steep premium hikes that would continue into next year.
Trump appeared to suggest during the weekend he was considering cutting off the funds as a result of Republicans' failure to come to an agreement on a healthcare bill that would repeal and replace portions of Obamacare.
"If a new HealthCare Bill is not approved quickly, BAILOUTS for Insurance Companies and BAILOUTS for Members of Congress will end very soon!" he tweeted.It remains unclear whether he intends to cut off the payments, because his tweets oscillated between this and various other options throughout the weekend. He and members of the administration said they were not prepared to give up on the Senate passing a healthcare bill.
But, Republicans appear ready to shift to other priorities.
Finance Committee Chairman Orrin Hatch, R-Utah, told Reuters in an interview Monday he and other congressional leaders planned to tell Trump they want to end the debate on healthcare for now and turn to tax reform.
Hatch said he would prefer Congress not appropriate the subsidies to insurers, but said, "I think we're going to have to do that."
He later added, "I'm for helping the poor, always have been. And I don't think they should be bereft of healthcare."
The funds help insurance companies reduce out-of-pocket medical expenses for 7 million low-income people who buy coverage on Obamacare's exchanges.
Their future has been in limbo because of a lawsuit House Republicans filed against the Obama administration in 2014, arguing the subsidies were unconstitutional because they should have been appropriated through Congress rather than directly through the Obama administration.
After a federal judge sided with their position, the Obama administration appealed the case and Republicans moved to delay it earlier this year after Trump won the Oval Office. The next hearing will be on Aug. 20, but a decision is expected to be announced by Trump before then.
Trump said months ago he was considering cutting off the funds as a way to bring Democrats to the negotiation table on healthcare, but he also has said he believed doing so would cause the public to blame him for the fallout. While waiting for details of a healthcare bill, the Trump administration has been approving the funds around the 20th of each month.
Insurers have remained largely silent publicly during the healthcare debate — except on this particular issue, saying they must have a guarantee about the payments in order for them to participate in the exchanges or keep costs at bay.
Open enrollment is set to begin in November, and insurers in some states already have requested an increase in their premiums by double digits, even if they assume the funds will be paid. People who receive subsidies through the exchanges will not personally feel the increase in premium costs, though the federal government would pay out more in subsidies. People who do not qualify for subsidies, who generally make more than $48,000 a year, also may find coverage prohibitively expensive.
Sen. Bob Corker, R-Tenn., said he thought Trump may continue the funding.
"It does in fact affect a lot of low-income citizens and my sense is that he will continue those," he said. "Regardless of what is being said I think he understand that it has an effect on low-income citizens."