Skip to Content


Filter by:



Second Opinion

Learn about policy issues important to medical schools and teaching hospitals, with Executive Vice President Atul Grover, M.D., Ph.D.

Washington Highlights

President Ends Cost-Sharing Reduction Payments, Signs Executive Order on ACA

October 13, 2017—President Trump Oct. 12 announced his administration would stop paying cost-sharing reduction (CSR) payments effectively immediately. Under the Affordable Care Act (ACA), the CSR payments help lower-income individuals purchase and maintain health insurance in the individual insurance market. The announcement was made in conjunction with the President signing an executive order intended to make it easier for individuals and small businesses to collectively buy health insurance through association health plans. These plans are not subject to all of the protections included in the ACA.

The President’s decision to stop paying CSRs, worth an estimated $7 billion this year, is likely to have a detrimental impact on the health insurance marketplaces. However, several health plans have planned ahead for the CSRs to be pulled. California, as an example, added a 12.5% surcharge on its silver plans in preparation for the CSRs to cease.

The CSRs have been the subject of an ongoing lawsuit concerning whether the payments must be explicitly appropriated by the House of Representatives [see Washington Highlights, August 4]. In a statement, House Speaker Paul Ryan (R-Wis.) said, “Today’s decision by the Trump administration to end the appeal of that ruling preserves a monumental affirmation of Congress’s authority and the separation of powers. Obamacare has proven itself to be a fatally flawed law, and the House will continue to work with [the] Trump administration to provide the American people a better system.” The impact of the President’s decision on the current lawsuit is unclear; however, New York Attorney General Eric Schneiderman has announced a group of Democratic attorneys general will likely sue to stop the President from acting.

The President’s announcement concerning the CSRs was met with condemnation from insurers. In a joint statement, America’s Health Insurance Plans (AHIP) and Blue Cross Blue Shield Association (BCBSA) stated, “Millions of hard-working Americans with modest incomes depend on CSR benefits to get medical care. These benefits help real people every day, and if they are ended, there will be real consequences.”

Contact:

Catie Spivey, JD
Sr. Legislative Analyst, Gov't Relations
Telephone: 202-862-6042
Email: cspivey@aamc.org

.

envelope on a green background

Subscribe to Washington Highlights

RSS icon

Subscribe to RSS

Washington Highlights, a weekly electronic newsletter, features brief updates on the latest legislative and regulatory activities affecting medical schools and teaching hospitals.


Past Issues


For More Information

Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806
Email: jkleinman@aamc.org