Without the subsidies, insurance markets could quickly unravel. Insurers have said they will need much higher premiums and may pull out of the insurance exchanges created under the Affordable Care Act if the subsidies were cut off. Known as cost-sharing reduction payments, the subsidies were expected to total $9 billion in the coming year and nearly $100 billion in the coming decade.Jonathan Chait explains in New York how the Trump strategy will increase health insurance rates and otherwise destabilize the marketplace. The Congressional Budget Office says the end of subsidies will increase insurance premiums by 20 percent by 2018 and 25 percent by 2020. Deficit rises.
“The government cannot lawfully make the cost-sharing reduction payments,” the White House said in a statement.
It concluded that “Congress needs to repeal and replace the disastrous Obamacare law and provide real relief to the American people.”