Delay in court case deepens health insurance uncertainty

Delay in court case deepens health insurance uncertaintyā€¯

Last month, the ousted Molina Health (MOH) CEO, Dr. J. Mario Molina, threatened to completely pull out of the exchanges if the government did not continue funding cost-sharing reductions.

But the Congressional Budget Office said that the Affordable Care Act's insurance exchanges were not failing and that government subsidies protected most policyholders from the premium increases.

That's because these employers, who often operate in multiple states, are allowed to pick which state's definition of essential health benefits they want to use in determining what counts toward consumer spending caps and annual and lifetime coverage limits.

Monday is a key date in the saga.

Both the Obama and Trump administrations have kept paying while the case is pending. The new health care bill would phase out CSRs by 2020.

This all will happen under the poorly named American Health Care Act that GOP members of Congress feverishly worked to approve.

But back to the subsidies.

Individual tax rates would go up 32 percent and sales taxes would be applied to dry cleaning, landscaping and more.

There's been a cascade of bad news in the past month, including Aetna's announcement that it's withdrawing completely and early insurer requests in Connecticut, Maryland, Virginia and NY to hike rates dramatically. The House Speaker, by way of example, is Republican conservative Paul Ryan, who by the way, still thinks President Trump is doing a great job.

A lower court ruled that the subsidies were not authorized, and the Obama administration filed an appeal. They don't want to chance assuming these payments will get made - and not having the payments come through.

"We can expect today's CBO analysis will likely show numerous same grave consequences", he said.

The White House had told congressional leaders it would make the monthly payment for May, which were due on May 19, but had stayed mum on payments thereafter.

-Significant federal funding to subsidize premiums and out-of-pocket costs. A federal judge agreed past year but let the subsidies continue while the case was appealed by Obama's Justice Department. But Trump officials have been cagey about promises for future payments. And it would be hard for him to stop them because that would undercut his legal position.

Attorneys general from New York, California, 13 more states and the District of Columbia last week asked the appellate court for permission to intervene in defense of the payments, interruption of which "would directly subvert the ACA, injuring states, consumers and the entire health-care system", they said then.

The prolonged indecision comes at a critical time for insurers, who are trying to finalize their proposed premiums for 2018.

Let's be clear: The Obamacare marketplaces in some states are likely headed for deep trouble, even with these subsidy payments. "Instead of hemming and hawing, they ought to step up to the plate and say once and for all that they will make these payments permanently, which help millions of Americans pay less for their healthcare". This could cause some insurers to drop out of the market and others to raise premiums substantially since they won't know whether they will get these payments by the time they have to file their premiums for next year.

It will be fascinating to watch how Trump moves on this.

The Trump administration is locked in a lawsuit - that originated during the Obama administration - with House Republicans who had sued because they argued the payments are illegal because Congress had not appropriated the funds.

Meanwhile, the Trump administration released a report that found a doubling of average premiums for individually purchased coverage from 2013, just before Obama's statute took effect, to this year.

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