The Congressional Budget Office said Friday that it plans to release an estimate next week about what would happen if Obamacare’s insurer payments are cut off.
The payments, known as cost-sharing reduction subsidies, are mired in a legal battle, and insurers have said that if they do not receive them, they would look to exit the exchanges as soon as they are able or would raise unsubsidized premiums for plans sold on the exchanges by about 20 percent for next year. President Trump has said he would consider cutting off the payments as a way to bring Democrats and Republicans together to negotiate a healthcare deal. After failing to pass a bill that would repeal and replace portions of Obamacare, a handful of senators said they believed the funds should be appropriated through Congress, and that they should move to do so when they return from their August recess.
The funds, expected to reach $7 billion in 2017, help insurers reduce out-of-pocket prices to low-income consumers. They were allocated under the Obama administration, spurring a lawsuit in 2014 by House Republicans who said the move was illegal because they needed to be appropriated through Congress. A federal judge agreed, and the case was appealed by the Obama administration as the payments continued to be made. Because states recently have joined the legal battle, the Trump administration can no longer drop the appeal, but it can discontinue funding.
