Trumps Trick as Repeal and Replace Bills Fall Short: Help Obamacare Kill Itself
In theory, Republicans could pull this off by pulling the money that subsidizes insurance for the poor. Voters won’t be fooled, though, about who’s to blame if that happens.
It’s like this. The federal government makes what they call “subsidy payments” or CSR’s (“cost-sharing reduction” payments) to insurance companies to help them cover the cost of insuring poor people under Obamacare. It’s explained well here, in this PBS NewsHour segment (video and transcript). The long and short of it is that it involves up to $12 billion a year in payments, and if insurers don’t get that money from Washington, they’ll have to raise it by jacking up premiums for some 20 million people by as much as $1,000 a year. And we’re talking about poor and working-class people for whom $1,000 is nothing to sneeze at.
So, the Trump administration ends the subsidies (this would be starting next year, an election year), and pretty soon you’ve got 20 million people whose Obamacare costs are going to shoot through the roof. And it will set off the infamous death spiral, and Republicans will say, “See? Obamacare! We told you!”
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Maybe. Except for two big things. One: Insurance companies themselves are blaming, and have been blaming, the Trump administration, not Obama. You’ve not noticed this in all likelihood, because it’s not been on the front pages, but for months now, insurance executives have been telling reporters that it’s the instability and uncertainty caused by the Trump administration’s refusal to commit to continuing the CSR’s that’s going to force them to jack up premiums.
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