Eight medical groups sent a letter to President Trump and congressional leaders Wednesday urging them to take “quick action” to stabilize Obamacare’s insurance exchanges by funding a program that reduces out-of-pocket medical expenses for patients.
If the funds aren’t distributed, the groups warned in the letter, insurer participation in the exchanges would diminish, premiums would rise, consumers would pay more and providers would not be compensated for their care.
“Without funding … by Congress and the administration, there could be a ripple effect in the individual insurance market, raising coverage costs for everyone,” said Chip Kahn, president and CEO of the American Federation of Hospitals, one of the groups that signed the letter.
The payments, called cost-sharing reduction subsidies, are given to health insurance companies to allow them reduce the costs of medical expenses such as deductibles and copays. The future of the program, created under Obamacare, has been in limbo because of a lawsuit filed by House Republicans when Barack Obama was president, which accused the administration of illegally distributing the payments.
A federal judge sided with the House, and the Obama administration appealed the ruling.
The Trump administration, which could drop the appeal, alarmed medical groups when it said Tuesday that it has not decided whether it will pay the cost-sharing subsidies, which are expected to total $9 billion in 2017 and cover roughly 7 million enrollees. The funds are being distributed until a decision is made by Congress or the administration, or pending another ruling on the case.
If cost-sharing subsidies are suddenly cut off, insurance companies probably would drop plans in most states as quickly as they could. Insurance companies also are facing a swift timetable to decide whether they will participate next year in the Obamacare exchanges that allow people who don’t get insurance through their employers to purchase a plan.
“Certainty about [cost-sharing subsidies] is essential as plans make their decisions about market participation and premiums for 2018,” said Kristine Grow, spokeswoman for America’s Health Insurance Plans, one of the groups that signed the letter. “We encourage swift action.”
Other groups that signed the letter included the American Academy of Family Physicians, American Hospital Association, American Benefits Council, Blue Cross Blue Shield Association, the American Medical Association and the U.S. Chamber of Commerce.
The Department of Health and Human Services has not responded to the letter.
