Trump Threat to Obamacare Would Send Premiums and Deficit Skyward

If Mr. Trump stops paying the subsidies, the budget office said, insurers will increase premiums for midlevel “silver” plans, and the government will incur additional costs because, under a separate program, it provides financial assistance to low-income people to help them pay those premiums. Insurers in some states would withdraw from the market because of “substantial uncertainty” about the effects of the cutoff.


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“About 5 percent of people live in areas that would have no insurers” in the individual insurance market in 2018, the budget office said.

The federal government helps pay premiums for low-income people by providing them with tax credits.

“Gross premiums for silver plans offered through the marketplaces would be 20 percent higher in 2018 and 25 percent higher by 2020 — boosting the amount of premium tax credits according to the statutory formula” established in the Affordable Care Act, the budget office said.

The budget office does not foresee much of an impact on the number of people who are uninsured if the cost-sharing subsidies are halted. “The number of people uninsured would be slightly higher in 2018 but slightly lower starting in 2020,” it said.

Document: Read the C.B.O.’s Report

The dispute over the subsidy payments dates back to 2014, when House Republicans filed a lawsuit asserting that the Obama administration was paying the subsidies illegally because Congress had never appropriated money for them. Last year, a federal judge agreed. The judge ordered a halt to the payments, but suspended the order to allow the government to appeal. The case is pending before the United States Court of Appeals for the District of Columbia Circuit.

The Trump administration has been providing funds for cost-sharing subsidies month-to-month, with no commitment to pay for the remainder of this year, much less for 2018.

Mr. Trump and some Republicans in Congress call the payments a bailout for insurance companies. But under the Affordable Care Act, insurers are required to provide the discounts to low-income people, who they say are the real beneficiaries.

Doctors, hospitals, insurers, consumer groups and the United States Chamber of Commerce have all urged Mr. Trump to continue paying the cost-sharing subsidies. Senator Lamar Alexander, Republican of Tennessee and the chairman of the Senate health committee, has said he plans to hold hearings next month, with a view to producing bipartisan legislation that would stabilize insurance markets and provide money for the subsidies.

“Without payment of these cost-sharing reductions, Americans will be hurt,” Mr. Alexander said recently.

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