Scott calls on Congress to fund Obamacare subsidies

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Gov. Phil Scott is urging Congress to continue federal health insurance subsidies that President Donald Trump ordered cut off.

Scott is one of 10 governors who sent a letter Thursday asking congressional leaders to take that step to stabilize the health insurance markets created under the Affordable Care Act. The markets largely serve people who don't get coverage through an employer.

The bipartisan group of governors wrote in support of continuing cost-sharing reductions — subsidies to insurers that go toward certain coverage bought through Obamacare exchanges like Vermont Health Connect.

The program allows low-income people — who make slightly too much money to qualify for Medicaid — to pay for a low-price health plan but get the same low out-of-pocket costs of an expensive health plan.

Trump announced he would end federal reimbursements to insurance companies for providing the benefit. However, the Affordable Care Act still mandates that insurance companies provide the benefit. That means consumers can continue to enjoy the cheaper rates, but the full cost would fall on insurers.

"With the elimination of federal payments for the cost-sharing reduction program, insurers are faced with significant financial losses, which could force them to withdraw from the marketplace, or, in some states, request significant rate increases," the letter says.

"The Congressional Budget Office warned that the president's action would increase premiums by 25 percent by 2020 and leave some Americans without any insurers in the nongroup market — all while driving up the national debt by nearly $200 billion," the letter says.

Al Gobeille, the secretary of the Vermont Agency of Human Services, said in an interview Thursday: "The ACA basically calls for these cost-sharing reductions, and then the federal government doesn't fund them. That's not OK. You wrote a law. You need to fund it."

He added: "We want the populace to understand that a law created something and it wasn't appropriated, and now, who's going to pay for it? And our recommendation would be that Congress does."

Vermont's attorney general has joined more than a dozen other states in suing Trump to maintain funding for the cost-sharing reduction subsidies. The lawsuit alleges Trump is violating a federal administrative law by acting without a public process.

Two leading U.S. senators reached a bipartisan deal this week that would continue the subsidies for the time being. The governors' letter urges the leaders of both parties in the House and Senate to hold a vote on that proposal.

The letter also says Trump's decision has confused consumers who need to buy health insurance.

"The timing of the termination — days before open enrollment begins — is sowing confusion among consumers and leaving states scrambling to develop solutions to stabilize their insurance markets," the letter says.

Open enrollment is the once-a-year period when customers who get insurance through exchanges such as Vermont Health Connect can change their plan for any reason. Uninsured people also can sign up during this time.

Trump has already cut the open enrollment period in half. In Vermont, open enrollment for Vermont Health Connect will run from Nov. 1 to Dec. 15. In previous years, open enrollment has run six weeks longer, through Jan. 31.

Mike Fisher, the chief health care advocate for Vermont Legal Aid, said his office has been receiving phone calls from people wondering if they should cancel their insurance plans or not sign up for 2018.

Because of federal law, eligible customers will still receive their cost-sharing reduction subsidies in 2017 and 2018, Fisher said. That means insurance companies are going to be absorbing the cost of the subsidies, he said, and likely seek drastically larger rate increases for the 2019 plan year.

"We want to make sure that Vermonters know that if they're eligible for cost-sharing subsidies that those supports are still available to them," Fisher said.

Additionally, Fisher said customers should know that the other type of subsidy available on Vermont Health Connect — advance premium tax credits, which help people pay their monthly premiums — is not affected by Trump's decision.

The Office of the Health Care Advocate staffs a hotline for Vermonters who have questions about health insurance. The number is 800-917-7787.

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