President Trump has defended his decision to end cost-sharing reduction (CSR) subsidies — an element of the Affordable Care Act that helped lower the cost of deductibles and co-pays for people making less than 250 percent of the federal poverty level — by pointing to the gain in stock prices for health-insurance companies.
Insurance companies do not make money through the cost-sharing provision, estimated to be worth about $7 billion in fiscal 2017. They’re being paid back for money they’ve already spent. If they do not get repaid for doing what is required under law, companies say they will raise premiums to make up the difference.
That in turn will raise the cost to taxpayers, because whatever savings result from eliminating the CSRs will be exceeded by additional costs for higher tax credits to defray the new premiums.
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