- Office of Attorney General Maura Healey
Media Contact for AG Healey Seeks Emergency Court Order Requiring Trump Administration to Maintain Cost-Sharing Reduction Payments
Boston — In light of the Trump Administration’s refusal to make cost-sharing reduction payments required by the Affordable Care Act (ACA), Massachusetts Attorney General Maura Healey has joined with California Attorney General Xavier Becerra, and 17 other attorneys general, in filing a motion today asking a federal court to require the payment of subsidies that millions of Americans rely on to lower insurance costs.
The motion, filed this afternoon in the U.S. District Court in San Francisco, asks the court to issue a temporary restraining order by tomorrow at 4 p.m., requiring the Trump Administration to continue making complete and timely cost-sharing reduction (CSR) payments as required by the ACA, including the payment that would ordinarily be made on October 20.
“President Trump is sabotaging health care for millions of Americans,” AG Healey said. “Hundreds of thousands of Massachusetts residents receive affordable health insurance coverage through the Health Connector, and I’ll fight to ensure the continued stability of the market.”
Last week, AG Healey joined a coalition of attorneys general in filing a lawsuit to protect millions of Americans, including tens of thousands of Massachusetts residents, from facing significant increases in health care premiums and major out-of-pocket costs.
Today’s filing includes a declaration from Audrey Morse Gasteier, the Chief of Policy and Strategy at the Massachusetts Health Insurance Connector Authority. The Health Connector, created in 2006 by state law, offers health insurance plans to individuals and small businesses and facilitates the availability, choice, and adoption of private health insurance plans.
In the declaration, Gasteier notes that for plans no longer receiving CSR payments by the federal government, premium rates would need to be increased by approximately 18 percent next year in order to compensate for losses.
“Up to 80,000 Massachusetts residents – those with incomes above 400% of the Federal Poverty Level or those who did not seek a subsidy – are expected to be enrolled in those plans at the time of Open Enrollment and do not receive a premium tax credit that would offset the expected rate increase. Those residents would thus face the full impact of those increases unless they change plans for 2018,” the declaration states.
The loss of CSR payments to Massachusetts insurance carriers for the remainder of 2017 is estimated to be $27-28 million, according to the declaration. In 2018, insurance carriers would lose approximately $146 million.
Today’s filing also includes a declaration from Hannah Frigand, Associate Director of HelpLine, Enrollment and Education at Health Care For All, highlighting impact ending the CSR payments will have on consumers. As the declaration notes, “when premiums for health care plans offered through the Health Connector have risen, at least some individuals decide not to purchase those plans even if they will pay a tax penalty.”
The ACA’s mandatory CSR payments to health insurance companies help working families access more affordable healthcare coverage by helping individuals who purchase health care on the exchange to enroll in plans with lower deductibles, copayments or coinsurance responsibility. Refusing to make the required payments directly undermines the ACA’s goals of making health care more affordable and accessible.
The abrupt decision to stop making CSR payments means that insurers will be required to cover the costs, but will not be reimbursed. According to the complaint filed last week, as many as 6.7 million residents nationwide will have to pay for these increased premiums out of their own pocket, and many of those individuals will be unable to afford that additional cost.