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April 12, 2017

In apparent reversal, Trump admin says it has not yet made a decision on ACA cost-sharing payments

Daily Briefing

    The Trump administration on Tuesday pushed back against reports that HHS will continue to fund the Affordable Care Act's cost-sharing subsidies while a lawsuit challenging the payments continues.

    HHS statement suggested admin would continue funding cost-sharing subsidies for now

    The ACA provides for the federal government to subsidize insurers for cost-sharing reductions that help low-income consumers pay for out-of-pocket health care costs such as coinsurance, copayments, and deductibles. However, the House in July 2014 authorized a lawsuit against former President Barack Obama's administration contending that Congress never approved the Department of the Treasury to actually make those payments to insurers.

    Following an initial court ruling in favor of the House's position, the Obama administration in May 2016 appealed to the District of Columbia U.S. Circuit Court of Appeals. However, after the presidential election, House Republicans and DOJ twice filed motions to delay the suit until May to allow the House and the incoming Trump administration more time to work toward a resolution, which the appeals court granted.

    The uncertainty surrounding the lawsuit has been a cause of concern among insurers and state regulators.

    The New York Times on Monday reported that HHS in a statement said the administration would continue paying the subsidies while a lawsuit challenging the payments continues, but that the White House had not clearly stated its stance on the suit itself. According to the Times, HHS in a statement issued to reporters wrote, "The precedent is that while the lawsuit is being litigated, the cost-sharing subsidies will be funded," adding, "It would be fair for you to report that there has been no policy change in the current administration."

    HHS pushes back against NYT report

    However, HHS spokesperson Alleigh Marre on Tuesday called the Times' report "inaccurate," saying the administration still is "deciding its position on this matter" and that HHS' earlier statement was "in reference to the current status of the lawsuit and is not an indication of what will happen in the future." The statement continued, "No decisions have been made about how the administration will proceed."

    According to Vox's "VoxCare," the latest statement again creates uncertainty about whether the administration will fund the subsidies while the lawsuit continues. In addition, it remains unclear whether the administration will continue defending the payments or whether it will drop the suit, which could effectively end the subsidies, Politico Pro reports.

    According to The Hill, America's Health Insurance Plans (AHIP) on Tuesday said it continues to believe the administration will make the cost-sharing payments while the lawsuit continues. AHIP spokesperson Kristine Grow called for more clarity on the payments as insurers "mak[e] their decisions about 2018" (Kliff, "VoxCare," Vox, 4/11; Diamond, Politico Pro, 4/11 [subscription required]; Sullivan, The Hill, 4/11; Nather, Axios, 4/11).

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