On Thursday night, the White House argued that it cannot lawfully make subsidy payments to insurers who rely on funding to reduce out-of-pocket costs for millions of low-income ObamaCare customers.
The White House said the Justice Department came to this conclusion after analyzing the cost-sharing payments and finding no congressional appropriation for them, and the Department of Health and Human Services said it will end the payments immediately. The subsidies are estimated to cost $7 billion this year, and under the law, insurers still must provide cheaper rates to members even if they no longer receive federal funding. Over the last several months, Trump has threatened to cut off the payments, which he called a "bailout" for insurance companies, and insurance companies have already raised prices in case he followed through. Still, the move is expected to significantly destabilize ObamaCare insurance markets.
In a joint statement, Senate Minority Leader Chuck Schumer (D-N.Y.) and House Minority Leader Nancy Pelosi (D-Calif.) said "it seems President Trump will single handedly hike Americans' health premiums. It is a spiteful act of vast, pointless sabotage leveled at working families and the middle class in every corner of America. Make no mistake about it, Trump will try to blame the Affordable Care Act, but this will fall on his back and he will pay the price for it."