These two steps obviously furthered the administration’s two-part strategy to undermine the ACA. President Trump is reportedly furious that Congress failed to repeal the ACA and has set out to single-handedly dismantle it himself. The cost-sharing reduction (CSR) payment cut-off will, in tandem with other steps taken by the administration to discourage enrollment in the individual market, drive up the cost of coverage. The executive order will open escape routes so that healthy people will leave the ACA-compliant individual market for cheaper, non-compliant forms of coverage.
Several conservative commentators have characterized the administration’s decision as a victory of the Constitution over lawlessness. They claim that the Obama administration made payments that had not been appropriated by Congress, in violation of the Constitution, and the Trump administration is finally complying with the Constitution. Why is anyone surprised, much less outraged?
This opinion was supported by the decision of a district court judge below in House v. Price. But it is important to note that the Obama administration never argued that it could make the payments without an appropriation—it argued that there was an appropriation. The Trump administration has now concluded, after making the payments for months, that the “best interpretation of the law” is that there is no appropriation. But the case is still on appeal to the D.C. Circuit, which could still conclude that the Obama administration was correct. A judge in the Northern District of California could also reach that conclusion. This is not a question of constitutionality versus lawlessness, but rather a dispute as to what the law is.
And health care correspondent Sarah Kliff wrote as Vox:
There is no question that this new policy is lose-lose-lose for key stakeholders with no upside:
— It will raise Obamacare premiums by an estimated 20 percent in 2018, as health plans have to charge more to make up the lost funds. By 2020, premiums would increase 25 percent due to this change.
— Pulling the plug actually increases the national deficit. As those insurance plans make double-digit rate increases, the government will have to spend billions more on the other subsidies that 10 million Americans receive to purchase that coverage.
— The Congressional Budget Office estimates that this move will ultimately cost the government $194 billion over the next decade.
— The number of uninsured Americans would rise by one million people in 2018, in the CBO’s estimate.
— Insurance companies lose out, too, particularly those that assumed Trump would pay these subsidies and set their premiums accordingly. They now stand to face significant financial loses on the Obamacare marketplaces.
To recap: Trump is enacting a policy where the government spends billions more to insure fewer people.
You’d think that would be a concern to a self-styled deficit hawk like Goodlatte. Apparently not.