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WASHINGTON — President Donald Trump’s decision to stop subsidies to insurers to offset costs under the Affordable Care Act will fuel higher rates for all Michiganders on the program and could directly impact more than 100,000 people in the state.

Trump went on Twitter this morning to declare that the Affordable Care Act — otherwise known as Obamacare — “is imploding” and said “massive subsidy payments … has (sic) stopped.” His administration announced Thursday night it would cease making cost-sharing payments to insurers under the program.

The administration had long been expected to discontinue the payments, which are intended to help recipients who don’t qualify for Medicaid but make up to 2 1/2 times the federal poverty rate keep down premiums, deductibles and other out-of-pocket costs.

That decision won’t immediately be felt by the roughly 320,000 Michiganders getting individual or small group coverage under Obamacare because they have contracts with their insurers. But it will add to even higher rates next year unless Congress steps in and restores the funding.

As the Free Press has reported, health insurers providing policies under the Affordable Care Act are expecting to raise premiums next year by an average of 27.6% under the assumption that Trump would stop the cost-sharing payments to insurers.

The state hasn’t formally singed off on new rates yet and has until Nov. 1 to do so.

Read more on this topic: 

HAP to exit Obamacare market as premiums set to skyrocket

Trump to end cost-sharing subsidies to insurance companies

Obamacare rates in Michigan could skyrocket as much as 31% in 2018

Blue Cross Blue Shield of Michigan, the largest insurer in the state, said earlier this year that it was looking to raise individual plan rates by a statewide average of 26.9% and an average of 13.8% for Blue Care Network HMO plans and said those increases would be even higher if cost-sharing subsidies were discontinued.

Based on federal data during open enrollment last year and early this year, more than 150,000 Michiganders were eligible for cost-sharing reductions, down somewhat from the more than 175,000 Michiganders in 2016 with insurance purchased through the Affordable Care Act exchange who received the benefit of the cost-sharing subsidies.

Those recipients in 2016 were spread across the state, with the largest numbers in Oakland (27,233), Wayne (26,287) and Macomb (21,643) counties. But there were also sizable numbers in other areas, including Kent County (10,671), Genesee (5,581) and Ottawa (4,482) counties.

Michigan’s 9th congressional district in Oakland and Macomb counties — represented by U.S. Rep. Sander Levin, D-Royal Oak — had the largest number of cost-sharing recipients, with 22,347, but districts represented by Republicans had large numbers of recipients, too.

They included U.S. Rep. Tim Walberg, R-Tipton, in Michigan’s 7th district in south central Michigan, which had 17,143 cost-sharing recipients, and U.S. Rep. Jack Bergman, R-Watersmeet, in the 1st district in the northern lower peninsula and Michigan’s Upper Peninsula, with 16,475 recipients.

Republican members of Michigan’s congressional delegation didn’t immediately respond to word of the Trump administration stopping the payments but Democrats roundly criticized it, as well as Trump’s remark on Twitter that in light of Congress’ failure to repeal and replace Obamacare he will do so, “piece by piece.”

U.S. Rep. Dan Kildee, D-Flint Township, said Trump’s actions are “actively undermining our health care system and causing instability” leading to a situation where Michiganders could see huge year-over-year costs. 

U.S. Sen. Gary Peters accused Trump of “playing politics with Michiganders’ health care.”

Levin, who helped pass the Affordable Care Act as a former chairman of the House Ways and Means Committee, said Trump “is continuing his hateful efforts to deny or disrupt health coverage for American families. His most recent decision to end needed federal assistance to help reduce out-of-pocket medical expenses will directly increase costs for millions of middle-class and moderate-income families.” 

Contact Todd Spangler at 703-854-8947 or at tspangler@freepress.com. Follow him on Twitter at @tsspangler.

 

 

 

 

 

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