Trump Issues One-Two Punch to Affordable Care Act in the U.S.

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CPEHN Condemns Actions Designed to Disrupt Insurance Markets; Calls on California’s Congressional Leaders to Denounce Latest Efforts

Late last night, President Trump became the destroyer in chief, announcing that he would scrap subsidies to health insurance companies that are used to pay for the cost of care for low-to-middle income consumers including hundreds of thousands of Californians. The move to deny Cost Sharing Reduction Subsidies (CSRs) came shortly after the President signed a sweeping executive order to allow insurance companies to sell cheap policies with fewer benefits and consumer protections.
“These actions will bring us back to the days when it was impossible for people with pre-existing conditions to afford health care. While some people may pay slightly cheaper prices, the cost of premiums will skyrocket for many of us,” according to Sarah de Guia, Executive Director of CPEHN. “California’s poorest residents many of whom are communities of color and include seniors, children, and those with pre-existing conditions will be pushed out of affordable, comprehensive care.”
In the short term, the elimination of CSRs will allow health plans in the federal marketplace to terminate their policies immediately. That could throw millions of consumers in the federal market off of insurance between now and the end of the year. More than half of people buying insurance through marketplaces benefit from the CSRs. At least 20 states found the Administration’s threats to end the CSR payments caused premiums to spike due to federal uncertainty causing California’s Attorney General Xavier Becerra to go to court for an injunction against the move.
Fortunately California planned ahead and took proactive steps to protect low and middle income enrollees from higher costs. Most Covered California consumers who receive cost sharing reduction subsidies will not see a change in what they pay for their insurance, and many may see the amount they pay toward their premium go down.  In 2018, nearly 60 percent of consumers eligible for subsidies will have access to Silver coverage for less than $100 per month – the same as in 2017 – and 74 percent can purchase Bronze coverage for less than $10 per month. However, there are tens of thousands of Californians who purchase silver plans through Covered California who do not receive subsidies.  These consumers can avoid paying higher prices by switching to a different metal tier or purchasing a nearly identical Silver plan outside of Covered California that does not include the surcharge. Covered California is working diligently to minimize confusion and educate consumers about their options in 2018.
Trump’s latest actions threaten to cut off bi-partisan Congressional discussions aimed at funding the subsidies and stabilizing the marketplace. Experts worry that using loopholes to skirt ACA rules will further undermine the market for remaining customers.  
“We won’t sit idly by and watch as all of the benefits that our communities have gained through the ACA are stripped away,” said de Guia. “We call on our representatives to speak out against the President’s health care sabotage and act NOW to pass bipartisan legislation that immediately and permanently funds cost-sharing reduction payments for California’s working families.”



Sarah de Guia, Executive Director, 510-832-1160

Christina Ricci, Communications Consultant, 510-402-8757

Cary Sanders, Policy Director, 510-832-1160