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President Trump blows up ACA adding $200 billion to deficit

Written by Diane Archer

President Trump has been saying for a long time that the ACA was going to implode. He was counting on Republicans in Congress to make sure that happened. Without their assistance, he just issued an Executive Order that blows up the ACA and  adds nearly $200 billion to the deficit.

On October 12, 2017, Trump signed an Executive Order that ends subsidies to help people with modest incomes enrolled in state health insurance exchanges pay their deductibles and copays. These “cost-sharing reductions” cost the federal government about $7 billion a year and save the seven million people who benefit from this help about $1,000 each in out-of-pocket costs. Vox’s Sarah Kliff reports that this provision in Trump’s Executive Order means:

  • Insurers could increase premiums by 20 percent in 2018 in order to cover their increased costs. Premiums could increase by 25 percent by 2020.
  • The federal deficit will increase because the government will have to spend $194 billion more to subsidize the increased premiums of 10 million people in the health care exchanges, according to the Congressional Budget Office.
  • One million more people will be uninsured in 2018.
  • Some health insurers will lose a lot of money on 2018 premiums set before the Executive Order was signed.
  • More health insurers may decide to leave the health insurance exchanges.

Congress could fix this problem by passing a law that specifically approves these cost-sharing reduction payments. Some believe that this is possible as part of a bi-partisan fix to avoid driving up the deficit.

In addition, the Trump Executive Order allows insurers to sell skimpy policies that do not cover the essential benefits mandated in the ACA. Some healthy people might leave the state exchanges and buy these skimpy policies because they cost less. But, these people will put their own health at risk if they get sick, because they are likely not to have the coverage they need. And, they will drive up premiums for people in the state exchanges.

Attorneys general from 18 states and the District of Columbia, including New York and California, filed a lawsuit on October 13 challenging Trump’s Executive Order, the Hill reports.

Here’s more from Just Care:


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