Popular vote loser Donald Trump is doing one thing very well: keeping fact checkers fully employed and well-supplied with material. This week, it’s the cost-sharing reduction payments that he keeps threatening to yank from health insurance companies on the Affordable Care Act exchanges. Trump insists on calling them “bailouts” because that sounds bad. And he insists on lying about it. Here’s Washington Post fact-checker Glenn Kessler on the actual facts.
The law required insurance companies to offer silver-level plans that discounted the out-of-pocket maximum depending on income level of the enrollee. So instead of a health plan paying, say, 70 percent of the cost of covered benefits, someone who was just above the poverty level would get a plan in which 94 percent of the costs are paid.
The CSRs were in addition to the premium tax credits received by people making less than 400 percent of the poverty line. (The tax credits were available for any level of plan.) The intent was to make it easier for low-income people to afford the cost of health insurance.
He goes on to explain that there was a drafting error in the process of writing the ACA that didn’t make it absolutely clear that the CSRs were automatically authorized and paid for by Congress. In a normal world, there would have been either a conference committee between the House and Senate that cleaned those kind of problems up, or there would have been a technical corrections bill passed. Most massive legislation like this one has to be cleaned up, and a functioning Congress usually does it. But the Republican boycott of all things Obamacare prevented that. Republicans decided to sue over it, a right-wing Bush appointee decided to side with them, and here we are with Trump threatening to punish insurance companies for making payments they are required by law to make.
Which is not a bailout. As Kessler says, a “bailout means a company is being propped up with government money after making bad decisions. That’s not the case here.” As if Trump is going to understand the nuances of these payments and how all this happened. But maybe he’ll understand this: not paying them could cost the federal government an extra $2.3 billion or more next year in having to make up the difference in premium costs with direct subsidies. Okay, he won’t understand the last bit there, but he should be able to grasp throwing away $2.3 billion. But since it’s other people’s money (meaning ours), he might just not care.
This is a Creative Commons article. The original version of this article appeared here.