The Trump administration and House Republicans are asking for another postponement in a federal court case over subsidies that help 7 million Americans with Affordable Care Act health plans pay for deductibles and co-pays — a move that heightens the limbo for insurers in the law’s marketplaces.
The request for the 90-day extension, in a filing Monday in the U.S. Court of Appeals for the District of Columbia Circuit, means the government will continue to provide the “cost-sharing reductions” at least through much of the summer.
But as the third consecutive request for a delay in the case, the court filing also injects fresh uncertainty for insurers during the season when they must tell states whether they intend to take part in ACA marketplaces for 2018.
The filings also prolong the indecision that President Trump has displayed over the $7 billion subsidy program since taking office, even as he has vowed to tear apart most of the sprawling health-care law.
In the required “status report,” the House and the Justice Department jointly asked the court to leave the case in abeyance. The two-paragraph filing said that both parties “continue to discuss measures that would obviate the need” for the court to rule — a reference to Republicans’ efforts to abolish most of the ACA and install more conservative health-care policies.
“We continue to work with the Trump administration on a solution,” AshLee Strong, press secretary to House Speaker Paul D. Ryan (R-Wis.), said in a statement.
Alleigh Marre, spokeswoman for the Department of Health and Human Services, confirmed that the May payments had been made. “We are weighing our options and still evaluating the issues,” Marre said.
Technically, the House and HHS are on opposing sides of the lawsuit, but since Trump succeeded President Barack Obama, they have been aligned in trying to dismantle much of the ACA.
The cost-sharing subsidies are one of two major types of assistance the law provides to most people who buy private health plans through the marketplaces. The cost-sharing subsidies, focused on lower-income ACA customers, reach nearly 6 in 10 such people. The other assistance helps cover insurance premiums for more than 8 in 10.
In 2014, the year the marketplaces opened, House Republicans sued the Obama administration to stop the cost-sharing payments. The lawmakers said they were illegal because Congress had not specifically approved money for them. Last year, a federal court agreed, and Obama officials appealed the ruling so that the money could keep flowing.
If it dropped the appeal, the Trump administration could immediately halt the payments. Doing so would probably devastate the marketplaces because insurers’ contracts allow them to drop out right away in such a situation. Customers could be stranded.
In the past months, the president has made contradictory statements about the cost-sharing payments. At times, he has said he opposes them. He also has said the payments will continue as long as the lawsuit lasts.
House Republicans who brought the case are now in the ironic position of not wanting to be responsible for a sudden loss of coverage by millions of people with ACA health plans. If the administration halted the appeal, it would be up to Congress to decide whether to approve money for the subsidies to continue.
The insurance industry, state officials and congressional Democrats are exerting considerable pressure on the administration and GOP lawmakers to not trigger sudden chaos within the marketplaces.
In states with the earliest deadlines for insurers to file plans to take part next year, insurers have mentioned the uncertainty surrounding the subsidies as part of the reason they are proposing large rate increases. America’s Health Insurance Plans, the industry’s main trade organization, and several other health and business groups sent a letter Friday to Senate leaders considering a House bill that would undo much of the ACA. The letter warned that “uncertainty is undermining the individual insurance market for 2018 and stands to negatively impact millions of people.” The organization urged Congress to promise that the cost-sharing payments will continue through next year.
The day before, attorneys general from 15 states and the District of Columbia filed a motion to intervene in the court case, contending that the president “has made increasingly clear that he views decisions about providing access to health insurance for millions of Americans — including the decision whether to continue defending this appeal — as little more than political bargaining chips.”
Then, over the weekend, the top Democrats on four congressional committees sent a letter asking for details of communications between insurance industry officials and the head of HHS’s Centers for Medicare and Medicaid Services. The Los Angeles Times has reported that CMS Administrator Seema Verma suggested a bargain in which the administration would continue the subsidies if the industry supported the House GOP health-care bill.
The Democrats’ letter said that Verma appeared to be “using the operation of the American health-care system as a tool to gain leverage in political negotiations.”
On Monday, House Minority Leader Nancy Pelosi (D-Calif.) derided the new extension request. “In merely delaying their suit, Republicans cynically continue to sow uncertainty in the health coverage of millions of Americans,” she said in a statement.