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HHS to Pay Cost-Sharing Reduction Bills for July

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The U.S. Department of Health and Human Services will send health insurers the expected Affordable Care Act cost-sharing reduction subsidy payments due in July, a White House spokeswoman said Wednesday.

“I believe that the decision has been made to make those through this month, and determine beyond that,” Sarah Sanders, a White House press aide, said at a press briefing, according to a briefing transcript provided by the White House. The White House press office later told several publications that HHS will make the cost-sharing reduction payments due through the end of July.

Marc Short, President Donald Trump’s director of legislative affairs, said at the press briefing, however, the Trump believes making program payments may be unconstitutional.

(Related: Health Insurers’ Next Affordable Care Act Scare Is Just Two Days Away)

The cost-sharing reduction helps Affordable Care Act exchange plan users with family income from 100% to 250% of federal poverty level pay their health insurance deductibles, co-payments and coinsurance amounts.

Some health insurance policy watchers were predicting that the Trump administration could withhold the program payments that were due today, to block the operation of the subsidy program and increase the odds of getting Affordable Care Act change legislation through Congress soon.

(Photo: Diego M. Radzinschi/ALM)

(Photo: Diego M. Radzinschi/ALM)

House Republicans have argued that HHS has no valid congressional appropriation to make the payments, and a district court judge has sided with the House Republicans. Trump said Wednesday, at a lunch with Republican senators, that the federal government is spending hundreds of millions of dollars on the cost-sharing reduction program, and that, if the payments stop, the current health insurance system will stop.

At the press briefing, a reporter asked Short about Trump’s remarks.

“The courts have ruled that the Congress never appropriated those dollars,” Short said, according to the briefing transcript. “And [the president is] acknowledging that and saying that, you know, here we are keeping Obamacare afloat, in ways that the courts have already ruled we arguably shouldn’t be doing. So, yeah, he’s concerned about that policy, and he continues to evaluate it each month.”

Another reporter asked Short about the political effects of withdrawing the subsidy payments.

“I think that the president wouldn’t view it as, ‘What are the political consequences?’” Short said. “He’s going to view it as, ‘What’s right?’ And, right now, there’s a legal opinion on that. And I think that there’s additional opinions being researched within our White House and giving him different advice on what should be the best course of action on those. I know where is heart is. I think he’s expressed that very openly what he thinks of those payments. But, as far as what the next step is, I think we’ll find out in the near future.”

A reporter asked Short what Short thinks insurance companies should do about the cost-sharing reduction program.

“Despite the fact we’re still considering what to do with it, this administration has continued to pay [the subsidies], so, it makes it additionally harder to say there’s any price increase that’s been related to that to date,” Short said.

— Read 5 Guesses About Trump Showdown Care, for Agents on ThinkAdvisor.