It just became harder for Trump to blow up Obamacare

  • Donald trumpWin McNameePresident Trump

    President Trump has repeatedly threatened to cut off a key payment for insurers, a move experts say could cause Obamacare markets to explode.

  • A court ruled that states can intervene in a critical court case to keep the payments funded.
  • This doesn’t mean Trump can’t end the payments, but it makes it harder and would put blame for any fallout squarely on his shoulders, experts say.

It became harder Monday night for President Donald Trump to help engineer the collapse of the Affordable Care Act.

A federal court ruled that attorneys general in 17 states and the District of Columbia would be allowed to intervene in a case between the Trump administration and the House of Representatives over crucial subsidies known as cost-sharing reduction (CSR) payments.

The possibility Trump could end the CSR payments is often cited by health-policy experts and insurance companies as the biggest danger to the short-term future of the Obamacare individual insurance markets.

The payments help reimburse insurers for providing low deductible and out-of-pocket cost plans for poorer Americans on the exchanges. Over the past few months, a slew of insurers and state insurance commissions reported that without the payments, premiums on the exchanges would increase substantially higher in 2018.

Under Obamacare, the payments came through an executive-branch order. The unusual appropriation became the subject of a lawsuit between the Republican-controlled House of Representatives and the Obama administration, with the health secretary as the plaintiff.

In 2016, a judge ruled in favour of the House, ruling the CSR payments illegal since they were not appropriated by Congress. The Obama administration filed an appeal of that decision.

Now, Trump and his team can decide whether to continue that appeal or pull it, which would effectively cut off CSR payments absent a move from Congress.

But on Monday, the court ruled that those 17 states and DC could intervene and continue the appeal. The court’s ruling said ending the payments would be damaging to the states’ citizens.

Nicholas Bagley, a professor of health law at the University of Michigan, wrote on the Incidental Economist blog that this decision by the court makes it harder for the Trump administration to cut off the CSR payments.

“If the Trump administration wanted to stop making cost-sharing payments, the easiest way to do so would be to dismiss the appeal. The lower court entered an injunction to stop those payments, but put its injunction on hold to allow for an appeal. If Trump were to order the appeal’s dismissal, the injunction would spring into force, and the payments would end,” Bagley said.

“Now the states can keep the appeal alive, even if Trump wants to get rid of it,” he added.

Bagley said a key elements of the case — as it was for some court decisions surrounding the administration’s travel ban — were Trump’s own statements. Trump’s tweets threatening to cut off the payments gave the court ample reason to believe the CSR payments could be stopped.

“The States have filed within a reasonable time from when their doubts about adequate representation arose due to accumulating public statements by high-level officials both about a potential change in position and the Department’s joinder with the House in an effort to terminate the appeal,” the court’s decision read.

Bagley and Timothy Jost, a professor at the Washington and Lee University School of Law and a supporter of the Affordable Care Act, suggested the decision doesn’t mean Trump can’t end the payments. But they said he can no longer simply pull out of the appeal and let the payments end.

“The decision does not mean that the Trump administration is barred from ending the cost-sharing reduction payments,” Jost wrote at Health Affairs. “It does mean, however, that the administration cannot unilaterally stop the CSR payments, dismiss the appeal, and claim judicial imprimatur for its doing so.”

Trump could instruct the Justice Department to announce that they no longer think the payments are legal, according to Bagley, but any chaos caused by the move would fall squarely on his shoulders.

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