BREAKING: Trump Axes Subsidies Propping up Obamacare

Late Thursday night, the Trump Administration announced that the government would no longer be making “cost-sharing reduction” (CSR) payments to insurance companies.

By Heidi Munson

Under Obamacare, the CSRs were intended to subsidize insurance premiums in order to lower costs to those purchasing the plans. Removing the $10 billion in subsidies for 2018 will cause premiums to rise by an estimated 20% according to the Congressional Budget Office.

White House Press Secretary Sarah Sanders released a written statement Thursday night which said:

“Based on guidance from the Department of Justice, the Department of Health and Human Services has concluded that there is no appropriation for cost-sharing reduction payments to insurance companies under Obamacare.”

“In light of this analysis, the Government cannot lawfully make the cost-sharing reduction payments. The United States House of Representatives sued the previous administration in Federal court for making these payments without such an appropriation, and the court agreed that the payments were not lawful.”

The move came just hours after President Donald Trump signed an executive order which would essentially allow more people to purchase insurance across state lines. Of course, one wonders why there was ever a law in place which would block the purchase of medical insurance across state lines, thus requiring further government action reversing the artificial barrier to the free market.

In response, Senator Chuck Schumer (D-N.Y.) predictably and immediately took to Twitter:

While the CSR payments will be halted, other Obamacare subsidies in the form of federal tax credits will not be affected. Eighty-five percent of those on Obamacare qualify for the subsidies, whose premiums should not be affected, since the subsidies rise along with premium increases.

Ultimately, whether you’re on the left or the right, we all recognize that what we have now is unsustainable. There is no free market in health care, so consequently, prices continue to shoot skyward. Some, such as Senator Bernie Sanders (I-Vt.) — and even Donald Trump — have argued for a government-run universal health care system.

It’s a very lovely thought, the idea that, if you get sick, you get “free” health care (of course, never mind that nothing is ever “free” — that it’s really you and your neighbors that are paying for your medical bills). The problem is, whenever the free market is tampered with, costs rise without fail (that’s assuming you don’t die waiting for treatment, which occurs regularly under government run health care systems around the world). And isn’t that what we’re all complaining about here? Costs? It’s nigh unaffordable. Yes. Nigh. It’s that bad.

Some have accused Trump of putting Obamacare in a “death spiral” with his two actions Thursday. But hasn’t our entire insurance system been on a “death spiral” for some time now?

The government puts additional mandates on insurance companies. The insurance companies, in turn, raise prices, since they’re being forced to cover additional services. The government, in turn, subsidizes the additional costs with taxpayer dollars. (If one were cynical, one might suppose it was so the elected official could go home and brag to their constituents about how much they “care” about making health care affordable — with other peoples’ money.) And on, and on it goes. Not sustainable.

Here’s an idea: what if we were all “allowed” to purchase whatever type of insurance we wanted, because insurance companies were “allowed” to sell the types of insurance their customers requested (I hope you’re having the same reaction I am at having to choke down the word “allowed” in the “land of the free”). I’ve yet to hear a good explanation as to why a 60 year-old man should be forced to buy insurance with maternity and birth control coverage.

We need to decide: what do we value more? Freedom or security? Because when it comes to insurance, in the real world, you can’t have it both ways. Freedom involves risk and choice and actual affordable costs. Security involves unaffordable prices ultimately resulting in a single-payer government run system, which always results in reduced services, diminished quality and care, and sometimes premature death due to waiting for care.

Those are our choices. We are adults, and we need to act like adults and face the economic reality. There is no such thing as “affordable” health care (or affordable anything) when the government is involved. We may not want to admit that, but, as John Adams said, “Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passions, they cannot alter the state of facts and evidence.”

Speaking of Founding Fathers, we do have one other choice: we could choose to return to the system they set up for us. Under that system, the federal government had no hand whatsoever in health care. Period. Full stop. End of story. The states, however, could be as government-run as their state constitution allowed, thus, setting up as many mini-laboratories as there were states. States could all test different ideas to see what worked (and what didn’t), and people could move to a different state if they didn’t like what theirs was implementing.

If you heart Romneycare, you could move to Massachusetts. If you don’t, you could move to a state with more freedom and choices.

So, America, in the area of health care, how pro-choice are you?

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