CMS to allow states to define essential health benefits

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The CMS proposed a rule late Friday aimed at giving states more flexibility in stabilizing the Affordable Care Act exchanges and in interpreting the law’s essential health benefits as a way to lower the cost of individual and small group health plans.

In the 365-page proposed rule issued late Friday, the agency said the purpose is to give states more flexibility and reduce burdens on stakeholders in order to stabilize the individual and small-group insurance markets and improve healthcare affordability.

The CMS said the rule would give states greater flexibility in defining the ACA’s minimum essential benefits to increase affordability of coverage. States would play a larger role in the certification of qualified health plans offered on the federal insurance exchange. And they would have more leeway in setting medical loss ratios for individual-market plans.

“Consumers who have specific health needs may be impacted by the proposed policy,” the agency said. “In the individual and small group markets, depending on the selection made by the state in which the consumer lives, consumers with less comprehensive plans may no longer have coverage for certain services. In other states, again depending on state choices, consumers may gain coverage for some services.”

However, the CMS acknowledged it’s unclear how much money the new state flexibility will save. States are not required to make any changes under the policy.

The CMS urged states to consider the so-called spillover effects if they choose to pick their own benefits. These include increased use of other services, such as increased used of emergency services or increased use of public services provided by the state or other government entities.

The agency in 2017 proposed standardized health plan options as a way to simplify shopping for consumers on the federally run marketplaces. The CMS said it would eliminate standardized options for 2019 to maximize innovation. “We believe that encouraging innovation is especially important now, given the stresses faced by the individual market,” the proposed rule states.

The CMS proposes to let states relax the ACA requirement that at least 80% of premium revenue received by individual-market plans be spent on members’ medical care. It said states would be allowed to lower the 80% medical loss ratio standard if they demonstrate that a lower MLR could help stabilize their individual insurance market.

The CMS also said it intended to consider proposals in future rulemaking that would help cut prescription drug costs and promote drug price transparency.

The Trump administration hopes to relax the ACA’s requirements and provide as much state flexibility as possible through administrative action, following the collapse of congressional Republican efforts this year to make those changes legislatively.

The proposed rule comes after months of calls from health insurers and provider groups for the federal administration to help stabilize the struggling individual insurance market. The fifth ACA open enrollment is slated to begin Nov. 1, and experts have predicted fewer sign-ups in the wake of a series of actions by the Trump administration to undercut the exchanges.

In the proposed rule, the CMS also proposes to exempt student health insurance from rate reviews for policies beginning on or after Jan. 1, 2019. The CMS said student health insurance coverage is written and sold more like group coverage, which is already exempt from rate review, and said the change would reduce regulatory burden on states and insurance companies.

The ACA requires that insurers planning to increase premiums by 10% or more submit their rates to regulators for review. The CMS proposed to increase the rate review threshold to 15% “in recognition of significant rate increases in the past number of years.”

The rule also tweaks a requirement that enrollees need to have prior coverage before attempting to get coverage via special enrollment after moving to a new area. Under the proposal, a person who lived in an area with no exchange qualified health plans will be able to obtain coverage.

Trump tells Senate to fix taxes — not Obamacare

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The bipartisan effort to stabilize insurance markets gets pushed to the end of the year.

President Donald Trump on Tuesday steered Senate Republicans toward tax reform and away from health care, pushing off any deal to fund controversial Obamacare subsidies to the end of the year at best.

Trump joined Senate Republicans at their weekly policy lunch but gave no direction on what he wants to see in a health care bill. He praised Sen. Lamar Alexander’s (R-Tenn.) work on a bipartisan deal meant to stabilize the Obamacare markets, but his emphasis on taxes led senators in the room to believe Trump doesn’t want a stand-alone Obamacare vote anytime soon.

“There isn’t anything else other than taxes,” said Sen. John Cornyn (R-Texas).

A filibuster-proof majority backs the bipartisan deal Alexander brokered with Sen. Patty Murray (D-Wash.), but conservatives and the White House oppose it, meaning it won’t even come up for a vote in the Senate.

Without a clear directive from the president, Republicans are still debating whether to work with Democrats to fund Obamacare’s “cost-sharing” program, which helps low-income people pay their out-of-pocket medical bills. Trump abruptly cut off the subsidies — the subject of a court battle — earlier this month. Insurers still have to make the payments, and many boosted their premiums for 2018 to take those costs into account.

Alexander’s stabilization bid got even more muddled when a pair of top Republicans said they would release a different bill — rivaling the bipartisan proposal — to fund the subsidies. But their version would neuter the individual mandate for five years, a nonstarter for Democrats who would be needed to get a bill through the Senate.

The new version “proves that we should be focused on tax reform right now, because obviously we haven’t gotten our act together on health care,” said Sen. John Thune (R-S.D.).

Republicans are increasingly confident that the subsidies will get rolled into a large, year-end bill to fund the government and raise the nation’s debt limit. But there is no agreement on what exactly that will look like, and leadership-level negotiations on the year-end bill are weeks away.

The lack of clarity left Senate Republicans with enough wiggle room to interpret Trump’s Obamacare comments as they see politically fit.

Cornyn saw a “shoutout” by Trump to Alexander as encouragement for his bill. “He wasn’t specific, but that’s the way I interpreted it,” he said.

But Sen. Ted Cruz (R-Texas) — an Alexander-Murray skeptic — said Trump didn’t offer any clear support for the proposal over the GOP’s competing ideas.

“There was not significant discussion on Alexander-Murray,” Cruz said.

Sen. Orrin Hatch (R-Utah), another foe of Alexander-Murray, walked away with the same conclusion.

“He didn’t get into that in great depth — put it that way,” Hatch said. “All I can say is that he wasn’t too definitive.”

During the lunch meeting, Trump focused more on getting tax reform done so that the GOP can take another shot at repealing Obamacare in the future, instead of what should be done to stabilize the health care law in the interim.

“If we get taxes done, we’ll have momentum for health care,” said Sen. Lindsey Graham (R-S.C.), summing up Trump’s position. “He talked a lot about doing health care again.” Trump has repeatedly stated recently that the GOP now has the votes for repeal in the Senate — but senators say that’s not the case, that no one has flipped.

The meeting marked Trump’s first visit to the Senate GOP’s weekly policy lunch as president, and it came amid a rift with Sen. Bob Corker (R-Tenn.) and growing concern within the GOP that lawmakers will go into the 2018 midterm election without a legislative accomplishment. That’s amped up the pressure in the GOP to do tax reform.

But many Republican senators said after the lunch meeting that there was no discussion of petty politics and that Trump was focused on notching some GOP wins.

“It was the complete opposite of what I thought it would be — the atmosphere in the room and his complete focus,” said one senator.

The conservative Obamacare bill introduced Tuesday came from Hatch, the chairman of the Senate Finance Committee, and House Ways and Means Chairman Kevin Brady.

That bill, which would fund the cost-sharing program for two years, is designed to appeal to Republicans who want to fund the Obamacare program but feel that Alexander didn’t get enough conservative concessions in his negotiations with Murray.

It would eliminate Obamacare’s individual mandate penalties through 2021 and expand the use of health savings accounts. The Hatch-Brady bill would also exempt businesses from the employer mandate for 2015 through 2017 and apply certain “pro-life protections” to the cost-sharing funding.

“We must include meaningful structural reforms that provide Americans relief,” Hatch said. “This agreement addresses some of the most egregious aspects of Obamacare.”

Some of the provisions in the proposal — like the expansion of HSAs and employer mandate exemption — mirror the changes that the White House requested be made to the Alexander-Murray bill.

Alexander said he was encouraged by a growing consensus Congress should fund the payments to insurers for two more years.

“We’ve gone from a position where everybody was saying we can’t do cost sharing to responsible voices like Sen. Hatch and Chairman Brady saying we should,” he said.

But any cost-sharing bill will need 60 votes to get through the Senate, meaning Republicans will have to get at least eight Democrats to sign on. Undoing the mandates in the future would be a nonstarter for many Democrats.

“If it were just a matter of getting Republicans to agree with each other, we would have repealed and replaced Obamacare by now,” said a Senate GOP aide.

Moody’s: Trump Executive Actions Credit Negative for HIX Insurers

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The investor-service company gauges impact of new ‘association’ health plans, expanded short-term insurance, and elimination of subsidies on the Obamacare exchanges.

President Donald Trump’s health-insurance executive actions last week are credit negative for insurance carriers operating on the Obamacare exchanges, New York, NY-based Moody’s Investors Service reported today.

On Oct. 12, Trump took two executive actions that will likely undermine the insurance exchanges established under the Patient Protection and Affordable Care Act (PPACA), Moody’s says:

  • In an executive order, the president eased regulations on “association” health plans and expanded the definition of short-term health insurance. The executive order calls for the federal departments of Labor, Treasury and Health and Human Services to expand insurance coverage for individuals such as allowing insurance purchases across state lines.
  • Although regulations must be put into place, association health plans will likely allow small businesses to band together to offer insurance to their employees. “Associations likely would be allowed to offer plans with lower benefits and lower costs,” Moody’s reported.
  • In a decision that did not require an executive order, Trump announced that his administration would end cost-sharing reduction (CSR) payments that subsidize the purchase of health insurance on the exchanges. The subsidies help insure low-income individuals who do not qualify for Medicaid coverage but can’t afford to buy commercial insurance health plans.
  • This year, the federal government spent about $7 billion on CSR payments.

The executive order is expected to promote creation of skimpy health plans, which would undermine the PPACA exchanges, Moody’s reported. “The introduction of lower-benefit, lower-cost plans and short-term insurance would be credit negative for health insurers that are still participating in the PPACA-governed individual market. These new plans would incentivize healthy people to exit the PPACA market, which would increase risk in the remaining pool of insureds.”

The decision to stop CSR payments will also have a credit negative effect on commercial carriers operating on the exchanges, Moody’s reported. This negative impact will fall particularly hard on commercial insurers that did not submit rates for next year based on the assumption that the CSR payments would be eliminated.

Health insurance rates are set on a state-by-state basis.

There could be an “offset” linked to the executive order that would soften the financial blow for commercial carriers operating on the exchanges, Moody’s reported. “If the executive order succeeds in bringing more healthy but currently uninsured people into the small group or individual market, that could mitigate at least some of the order’s negative effects.”

Moody’s highlighted the PPACA-exchange risk exposure of four commercial carriers in today’s report, which lists the companies’ beneficiaries on the exchanges as a percentage of their total number of health-insurance beneficiaries:

  • Indianapolis-based Anthem Inc.: 2.9%
  • Chicago-based Health Care Service Corporation: 6.8%
  • St. Louis-based Centene Corporation: 9.2%
  • Long Beach, CA-based Molina Healthcare Inc.: 20.4%

ACA Alterations Will Jolt Health Exchanges for 2018

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The end of cost sharing reductions has insurers trying to raise premiums even higher than planned. Those high premiums and other changes to the Affordable Care Act may drive consumers away from the exchanges.

The loss of cost sharing reductions (CSR) and the presidential executive order altering the Affordable Care Act will combine to significantly shake up the insurance market for 2018, one analyst says.

The effect is likely to include raising rates so high that the number of healthcare consumers who do not purchase coverage will skyrocket.

Health plans are scrambling to raise their rates even higher than already planned, responding to President Donald Trump’s announcement that insurers will no longer receive the subsidies.

Insurers were forced to submit rates for next year while the fate of CSRs was still uncertain—one set of rates is for if the subsidies continued and the second is for a higher rate to be used if they did not.

Some insurers are asking for a chance to revise the rates already submitted, says Julius W. Hobson Jr., an attorney and healthcare analyst with the Polsinelli law firm in Washington, D.C.

The CSR termination comes right after President Trump issued a new executive order he says is designed to increase competition and choice. Critics say it would seriously weaken the ACA, and some say that’s intentional.

President Trump says the order will give millions of Americans more access to affordable coverage and make it easier for people to obtain large-group coverage. Others worry that it could lure healthy young Americans away from the ACA exchanges, leaving those who remain to pay higher premiums.

“The combination of the executive order and the CSR termination wreaks havoc on the health insurance market for all of 2018,” Hobson says. “This also comes just before the open enrollment and with cutting back money for the patient navigators who help people sign up, and with reduced access to the website. That all means there are going to be fewer people who sign up.”

Higher premiums and deductibles already were driving some consumers away from purchasing individual healthcare plans, Hobson notes, and more will follow when the CSR loss forces insurers to raise rates even higher.

If the Trump administration stops enforcing the individual mandate, as it has said it might, that would make even more consumers forgo coverage, he says.

Fewer consumers buying insurance on the ACA exchanges intensifies their existing problems, Hobson says.

Premiums and deductibles will continue to rise as insurers struggle to remain profitable with a smaller pool of older, sicker patients driving high utilization costs. More and more consumers will leave the exchanges if they can, he says.

“People are going to be looking at premium increases they just can’t afford,” Hobson says. “The individual market will take a big hit, but the impact on the group market is harder to predict. We don’t know yet whether the increases in the individual market will bleed over into the group market.”

The recent changes are intended to weaken the ACA, Hobson says.

“The administration has said the ACA is imploding, but also that they’re going to do everything they can to wreck it. It’s not imploding on its own, it’s being shoved down the trash chute,” Hobson says.

“Losing the CSR payments is critical and, at this point, it’s unlikely that even if Congress acted they could do anything in time to affect 2018. There’s no way of looking at this other than it having a negative outcome,” he says.

Trump Flip-Flops on Senate Health Care Deal

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President opposes bipartisan deal he supported the day before.

President Donald Trump reversed gears on a bipartisan Senate health care deal Wednesday, saying he would not sign the pact reached by Sens. Lamar Alexander and Patty Murray less than 24 hours after he signaled support for it in a public appearance in the Rose Garden.

Trump “supports the process” of trying to find a short-term fix to the 2010 health care law, but he “doesn’t support the result,” a White House official said of the efforts by the chairman and ranking member of the Senate Health, Education, Labor and Pensions Committee.

The opposition comes just after Trump tweeted Wednesday morning he could not “support bailing out ins co’s who have made a fortune w/ O’Care.”

That came after Trump said in a speech to the Heritage Foundation Tuesday that he opposed continuing cost-sharing subsidy payments that help low-income people pay for health insurance on the exchange, the crux of the Alexander-Murray deal and something state insurance officials and insurance companies say is essential to the markets not collapsing. Trump last week said he would end the administration’s practice of making those payments.

That move has not resonated with the public. Fifty-three percent of respondents to an Economist/YouGov survey conducted Oct. 15 and 16 said they disapproved of the executive move, compared to 31 percent who were in favor. Sixteen percent declined to give an opinion.

“While I commend the bipartisan work done by Senators Alexander and Murray — and I do commend it — I continue to believe Congress must find a solution to the Obamacare mess instead of providing bailouts to insurance companies,” Trump said.

That speech came just a few hours after he said in the Rose Garden that administration officials have been involved in the Alexander-Murray talks and signaled he supported what he described as a one- or two-year package.

In that White House appearance, Trump called the Alexander-Murray move a “short-term deal” that is needed to “get us over this hump” until Republicans might find a way to send him a measure to partially or completely repeal the Obama-era law.

During a HELP Committee hearing that wrapped up just after Trump’s tweet Wednesday, Alexander said he and Murray, along with several co-sponsors, would present the plan on the Senate floor.

Murray ruled out major changes to the plan after Trump’s newfound position.

“This is our bipartisan agreement. We’ve agreed on it, and it’s a good compromise, both of us had to give and that’s what we have,” the Washington Democrat said.

Alexander said the president had encouraged senators to keep working toward a deal.

“The president called me this morning, which is the third time he’s called me about this. I appreciate his encouragement of the process,” the Tennessee Republican said. “He asked me to do it, to work with Sen. Murray on the project. He said he would review the legislation, which is what I would expect a president to do. So we will keep working on it.”

Alexander said Tuesday he briefed Senate Republicans on the temporary plan that would provide funding through 2019 for cost-sharing reduction subsidies that help lower-income consumers. It would also give states more flexibility to seek waivers to bypass the law under certain conditions.

Requirements for certain health benefits and banning insurers from charging more would stay in place, Alexander said.

House Speaker Paul D. Ryan’s position remains that the Senate should focus on repeal and replace efforts, a spokesman said.

How Trump set up Obamacare to fail

All the ways the Trump administration has made it harder to sign up for health insurance this year.

President Trump hasn’t succeeded in repealing Obamacare yet. But his administration is doing its best to force the law to fail.

The most critical time of the year for the health care law is almost here: open enrollment, when millions of people log on to online marketplaces, check whether they qualify for federal subsidies to help them pay their premiums, and shop for plans. For the past three years, at least 10 million people have gotten insurance that way each year.

But this year, open enrollment is in the hands of a White House that’s openly hostile to the Affordable Care Act — and the Trump administration is taking advantage of the best opportunity it has to undercut the law.

President Trump has said that he wants Obamacare to implode, which he hopes would reignite the stalled congressional effort to repeal it. He isn’t just sitting around waiting for that to happen. His administration halved the length of open enrollment. They slashed spending on advertising and assistance programs. They pulled out of outreach events at the last minute.

The entire health care law could be at stake. Advertising and outreach are primarily targeted to younger and healthier people, who are essential to the law’s goal of affordable insurance coverage for all Americans. If their enrollment drops while older, sicker people keep signing up, premiums are going to increase even more next year.

It’s the start of a death spiral, a self-perpetuating cycle of price hikes and falling enrollment — which is exactly what Trump has said he wants.

“I think what this cumulative activity can do is start that death spiral,” Kathleen Sebelius, President Obama’s health and human services secretary during the ACA’s first open enrollment, told me.

Obamacare supporters are already conceding that as a result of these cuts, they likely won’t be able to match last year’s 12 million sign-ups. “I don’t actually think that’s possible anymore,” Lori Lodes, who worked on Obamacare enrollment in the Obama administration, told me.

We will know by December 15, the end of this year’s open enrollment period, how much the White House has succeeded in gutting Obamacare. By embracing this strategy, the Trump administration has put its political goals ahead of the millions of people who depend on the ACA for insurance.

“I really do think what they want to be able to do is come out on December 16 and say, ‘See, we told you Obamacare is imploding; it’s failing,’” Lodes said. “When the reality is they are going to be responsible because of the decisions they’ve made to undermine open enrollment.”

Open enrollment and outreach, explained

Every fall, the Obamacare insurance marketplaces open for business. People have a few weeks to log on, check out their options, and sign up for coverage. This year, sign-ups start on November 1 and close on December 15.

An entire apparatus exists to support open enrollment. Most states use the federal, while a few run their own marketplaces. The feds and some states run call centers, where people can talk to a real person to walk through enrollment. The federal government funds navigator and in-person assistance programs, which set up places where people can get help navigating the sign-up process.

Open enrollment hasn’t technically changed much this year, except it’s been shortened from 12 weeks to six. Otherwise, it’s pretty much the same. will still be open. People can still get tax subsidies and shop for coverage. All of the ACA’s regulations, such as protections for people with preexisting conditions and the requirement that insurers cover essential health benefits, remain in place.

But the mere need to clarify that, yes, Obamacare is still around is a big problem for open enrollment. After eight months of Republicans fighting to repeal it while claiming it’s failing, people like Lodes worry that many Americans think the law either is already gone or won’t be around for much longer.

Which is why outreach is so important.

The Obama administration went all out every year to promote open enrollment. President Obama appeared on late-night TV and viral online shows. The administration recruited celebrities to star in ads or highlight open enrollment on social media. Senior officials scrounged for as much money for the navigator program as they could find.

While things didn’t always go smoothly — the launch of was a disaster — the efforts helped 12 million people sign up for coverage in 2016. The uninsured rate has dropped to historic lows, and insurers have started to see improved business on the law’s marketplaces.

The key, Lodes said, was blanketing people with information — from television ads and email and text message reminders to working with community-based groups and churches. The biggest barrier was convincing people they could actually afford insurance, once the law’s financial assistance was accounted for.

Outreach works: The Huffington Post reportedrecently that an internal Health and Human Services Department report concluded that 37 percent of sign-ups in the last few months of 2016 could be attributed to outreach.

Trump administration officials have defended their outreach cuts in part by arguing that people are already familiar with Obamacare after three years. “I don’t think we can force people to sign up for a program,” a senior administration official told reporters in August.

But that runs counter to the available evidence. Nearly 40 percent of the US uninsured were still unaware of the marketplaces last year, and almost half did not know they might be eligible for financial assistance, according to surveys by the Commonwealth Fund.

“There is a difference knowing Obamacare is the law and knowing what you should do with that information,” Lodes said, “between knowing you need to sign up in this finite period of time or you do not get health coverage.”

The Obama administration had assumed that older people or people with preexisting conditions who struggled to get insurance before the ACA would be eager to sign up. So they focused their efforts on reaching younger people or people who hadn’t had insurance before. Every year, people turn 26 and roll off their parents’ health insurance, or maybe they get a new job with a higher salary and need to move from Medicaid to private insurance.

Every year, in other words, there are brand new customers for the ACA marketplaces.

“They’re either the least familiar or they are the healthiest. Either way, they either don’t know or don’t believe they need or want health insurance,” Sebelius said. “For somebody to suggest that there is no persuasion needed is just nuts.”

How Trump is sabotaging Obamacare enrollment

Because open enrollment is such a sprawling undertaking, the Trump administration has many tools at its disposal to undermine it and, by extension, the ACA. It seems to be using all of them.

The White House has some minimal requirements under federal law. It must perform outreach and education, it must run a call center, it must have a website where people can enroll, and it must operate a navigator program.

On paper, the Trump administration will do each of those things. But each is facing significant cuts. Together, they add up to a clear picture of an administration using every means available to drop support for ACA enrollment:

  1. Just a few weeks into the Trump administration, HHS announced it would reduce open enrollment from 12 weeks to six weeks.
  2. Trump has threatened since the spring to cut off federal payments to health insurers, driving up premiums and leaving some counties at risk of having no insurance options.
  3. Over the summer, Trump administration officials hinted they might not enforce the individual mandate.
  4. In August, HHS said it would cut funding for Obamacare advertising by 90 percent, from $100 million to $10 million.
  5. HHS also said it would cut funding for in-person assistance by 40 percent.
  6. A few weeks later, the department let the in-person assistance budget run out entirely without awarding more money.
  7. Late last month, the administration abruptly pulled out of state-level open enrollment events.
  8. HHS has cut off relationships with Latino groups that had worked with the Obama administration to enroll that population in coverage, Talking Points Memo has reported.

In other words, the Trump administration is cutting funding for outreach, cutting funding for enrollment assistance, and dropping out of partnerships to support enrollment, while shrinking the window for people to sign up for coverage, sowing doubts about whether people will be required to have insurance, and making threats that drive up premiums.

So as Trump claims Obamacare is failing, his administration is setting up a self-fulfilling prophecy.

Obamacare supporters are trying to fill the gaps with grassroots programs like the Get Covered campaign, run by former Obama administration officials. But they do not have the same resources as the federal government.

The ideal TV advertising campaign, for example, would cost about $15 million, said Lodes, who is helping to oversee Get Covered. They already know, with mere weeks left until open enrollment starts, that they will not be able to raise that kind of money, which means the hole left by the Trump administration cutting $90 million from the ACA’s advertising budget will go largely unfilled.

“There is no way that anything we do or anyone else does can fill the footprint of what the admin should be doing,” she said. “They were unable to get repeal passed through the Congress, so they really seem intent to do everything they can do to make sure open enrollment is not successful.”

Weak enrollment is a huge threat to Obamacare’s future

The inevitable result of the Trump administration’s actions will be fewer Americans with health insurance. Last year, 12 million people signed up for coverage through the Obamacare marketplaces. Nobody expects to match that number this year, after open enrollment has been so severely undermined.

“There is no doubt that the actions by the administration will mean that fewer people get covered,” Lodes said.

The number of uninsured Americans will likely tick up from its current historic lows. Hundreds of thousands or even millions will not be financially protected against a medical emergency, and it will be harder for them to afford the routine health care that prevents bigger problems later on. That will have a real effort on people’s lives and financial security.

But falling enrollment also threatens Obamacare’s future.

The law works when younger, healthier people and older, sicker people all sign up for coverage. Insurers need the low-cost patients to help cover the costs of the sicker ones, who are more likely to rack up big medical bills. The ACA has both sticks (the individual mandate) and carrots (cheaper premiums for young people and generous subsidies) to get everybody into the market.

But getting younger and healthier people takes a little more effort. They have been the focus of the outreach that Trump is now cutting.

People who have medical conditions already or who are older and know they may soon need insurance are going to find a way to enroll regardless. But young and healthy people are less likely to think they need insurance. They need some persuading that the ACA’s coverage will help them in an unlikely medical event and that they will be able to afford it, Sebelius and Lodes said.

“The last person to sign up is probably the healthiest person to sign up,” David Anderson, a former insurance industry official who now researches at Duke University, told me.

With a sicker pool left behind, health insurers are likely to either increase premiums even more next year or leave the market altogether. Plans have already cited the marketing cuts as one reason for increased premiums in 2018. And the higher premiums get, the more difficult it is to persuade young and healthy people to pay the price.

If sign-ups plummet — which even Obamacare supporters expect after the Trump administration has done so much to undermine open enrollment — the law’s future will be in serious peril.

“What that means over the long term is the health of the marketplace is at risk,” Lodes said.

No matter what the president says, Obamacare isn’t failing yet. But his administration is trying as hard as it can to make those words a reality.

The High Cost of Trump’s Controversial Obamacare Decision

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The Trump administration announced late Thursday that it would stop paying subsidies to insurers that help cover the cost for about 6 million low-income customers on the Obamacare exchanges. The Department of Health and Human Services said that the cost sharing reduction (CSR) payments “will be discontinued immediately.”

Although eliminating the payments will save several billion dollars in the short run – the payments cost roughly $7 billion in 2017 and were set to rise to $10 billion in 2018 – the federal government will end up spending more on Obamacare subsidies due to the higher cost of health insurance. A CBO analysis from August found that terminating the payments “would increase the federal deficit, on net, by $194 billion from 2017 through 2026.”

Here’s what the controversial decision means:

Trump is clearly looking to destroy Obamacare: Combined with Trump’s executive order Thursday undercutting Affordable Care Act markets, this move represents taking a sledgehammer or a chainsaw to Obama’s signature law. “President Trump left little doubt yesterday that he intends to do as much damage as he can to the Affordable Care Act’s insurance markets,” Axios’s Sam Baker writes. “And he can do a lot.”

Many Americans, and insurers, will be hurt: Insurers have locked in their rates for 2018, but some may try to secure increases or decide to pull out of some markets. “This action will make it harder for patients to access the care they need. Costs will go up and choices will be restricted,” the Blue Cross Blue Shield Association and the health insurance trade association said in a joint statement. If premiums do jump as expected, low-income enrollees who get federal subsidies to cover the cost of their plans won’t feel the pinch, but millions of Americans who earn too much to qualify for the subsidies will face sharply higher costs.

It’s hard to find any winners here: “Trump’s new policy will increase premiums by 20%, cost the government $194 billion, increase the deficit, destabilize insurance markets, and increase the number of uninsured Americans,” Vox’s Ezra Klein tweeted. “There is nothing it makes better; it’s pure policy nihilism.”

Though some call it a win for the Constitution: The administration justified its move by citing a Justice Department decision that the payments were illegal without Congressional appropriation, a question at the heart of a lawsuit by House Republicans. “Today’s decision … preserves a monumental affirmation of Congress’s authority and the separation of powers,” the House Speaker Paul Ryan said in a statement late Thursday.

Not every Republican is pleased: “Cutting health care subsidies will mean more uninsured in my district. @potus promised more access, affordable coverage. This does opposite.” – Rep. Ileana Ros-Lehtinen (R-FL) tweeted. And Nevada Gov. Brian Sandoval said, “It’s going to hurt people. It’s going to hurt kids. It’s going to hurt families. It’s going to hurt individuals. It’s going to hurt people with mental health issues. It’s going to hurt veterans. It’s going to hurt everybody.”

And Democrats want to make sure Trump owns health care now – and “will pay the price for it”: “Sadly, instead of working to lower health costs for Americans, 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,” House Minority Leader Nancy Pelosi (D-CA) and Senate Minority Leader Chuck Schumer (D-NY) said in a joint statement. “Now, millions of hard-working American families will suffer just because President Trump wants them to.”

Lawsuits are already in the works: “A coalition of U.S. states lined up on Friday to sue” to prevent the subsidy cuts, Reuters reports. Democratic attorneys general in New York and California are joining with other states, including Kentucky, Massachusetts and Connecticut, to file suit in federal court in California. Insurers, who are required by Obamacare to reduce out-of-pocket costs for low-income enrollees, could also sue to get the compensation the law promises in return.

The pressure will be on Congress to step in: “President Trump is once again the bull in the china shop, telling Congress, ‘I broke it, you buy it,’” ABC News says. Congress can have the subsidies resume by appropriating money for them, and Sens. Lamar Alexander (R-TN) and Patty Murray (D-WA) are negotiating an Obamacare fix that would include that, but they reportedly still have a long way to go to reach an agreement.

And Trump may still be open to a deal: “I will say the Democrats should come to me, I would even go to them,” Trump said Friday. “I’m only interested in one thing: getting great health care for this country.” But Mick Mulvaney, director of the White House Office of Management and Budget, said Friday that Trump would oppose a compromise along the lines of the one being negotiated. The question then is what else Trump might want in return.