The Trump administration vehemently pushed back on reports that it plans to pay insurers for covering co-pays and deductibles for low-income Obamacare customers.
The statement from Health and Human Services, in response to a report in the New York Times, comes as Obamacare insurers want to know whether the payments will continue into next year. Without the payments, experts and some insurers say that premiums could spike and even more insurers would flee the individual market.
“The administration is currently deciding its position on this matter,” said HHS spokeswoman Alleigh Marre. “We have not been contacted by Democrats to help save Obamacare, perhaps because they consider Obamacare to be a losing cause.”
The New York Times report said the administration is willing to continue the cost-sharing reduction, or CSR, payments despite a lawsuit from the House that the payments were illegal.
The Times report said that HHS would continue to pay out the cost-sharing payments while the lawsuit is being considered.
But Marre said that the report was in reference to the “current status of the lawsuit and is not an indication of what will happen in the future. No decisions have been made about how the administration will proceed.”
Under Obamacare, insurers would cover the copays and deductibles for low-income customers and then the government would reimburse them. The federal government paid out $7 billion in cost-sharing reduction payments in 2016.
However, the House sued the Obama administration on 2014. The House argued that Congress didn’t authorize the payments and a federal judge agreed with them.
The Obama administration appealed the ruling, but it remains unclear whether the Trump administration would keep that appeal going. A status report on the lawsuit is due on May 22.
Insurers still have to cover the cost-sharing reductions, even if the government doesn’t reimburse them. That means that without the payments then insurers could either raise premiums to compensate for the reductions or wind up leaving the individual market altogether.
Obamacare insurers are considering how much to charge for plans for 2018, and must submit rates in June. The insurance industry wants to know if the cost-sharing payments will be funded.
“As plans make decisions for 2018, they do so with a view of wanting to serve consumers in the market for the full year,” said Kristine Grow, spokeswoman for America’s Health Insurance Plans. “That’s why it’s so important to know what will happen with CSRs long term.”
