What Trump’s decision on health care subsidies means for Obamacare — Quartz

The White House has confirmed that Donald Trump intends to scrap a critical Obamacare subsidy. In his most dramatic action yet against the Affordable Care Act, the US president will end subsidies to insurers selling plans to low-income customers.

The “cost-sharing reduction subsidies,” or CSRs, have been in Trump’s crosshairs for months. He’s finally pulling the trigger, partly out of frustration over Congress’s failure to repeal and replace Obamacare—something that as a candidate he promised would happen quickly once he took office in January.

The move prompted immediate criticism from political opponents, insurers, and state attorneys general, among others. In a joint statement, Democratic lawmakers Nancy Pelosi and Charles Schumer, the house and senate minority leaders, respectively, described the move as “a spiteful act of vast, pointless sabotage.”

John Baackes, CEO of L.A. Care Health Plan in California, which offers health insurance to low-income individuals in Los Angeles county, told Politico the move was “a gross dereliction of duty” by the president. “The Affordable Care Act is still the law of the land and the cost-reduction subsidies are part of that,” he said.

New York state attorney general Eric Schneiderman, in a statement on his website, indicated he was ready to lead colleagues in a lawsuit against the Trump administration:

“Hundreds of thousands of New York families rely on the Affordable Care Act’s subsidies for their health care… will not allow President Trump to once again use New York families as political pawns in his dangerous, partisan campaign to eviscerate the Affordable Care Act at any cost.”

California attorney general Xavier Becerra said he too was ready to take legal action.

Amounting to about $7 billion this year, the subsidies reduce deductibles and other out-of-pocket costs for roughly 6 million low-income Americans who buy coverage on Obamacare exchanges.

In August the Congressional Budget Office looked at how ending the subsidies might affect Obamacare, and concluded it would lead to premiums spiking, insurers exiting the market, and the federal deficit increasing.

Some members of Trump’s own party were critical of the president’s move, including House Republican Ileana Ros-Lehtinen of Florida:

Some critics took note of the late hour at which the White House confirmed Trump’s decision, which it did via an email sent to reporters at 10:47pm EDT:

Others highlighted that the move comes after Republicans, who control both houses of Congress, failed to muster enough votes to repeal Obamacare:

Another theme of the social-media criticism was that Trump, and by extension the Republicans, would have to own the consequences of the move:

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