Arizona insurers respond to Trump cutting Obamacare subsidy

Obamacare is on the brink of chaos, less than three weeks before enrollment opens for next year.

Here in Arizona, we've verified there is some stability: At least one of the two health insurers on the federal marketplace won't be raising premiums in response to President Donald Trump's elimination of a huge subsidy.

After failing to kill Obamacare in Congress, the president stripped away a $7 billion annual subsidy for insurers, known as a CSR.

It was Trump's second major blow against Obamacare in 24 hours, after an executive order Thursday. The elimination of the subsidy might force health insurers to raise premiums or bail out on their customers.

CSR's are "cost-sharing reduction" payments to insurers from the federal government. They reduce out-of-pocket costs for Obamacare.

Last year, a federal judge ruled the payments by the Obama Administration were unconstitutional, because the money wasn't appropriated by Congress. The ruling was stayed pending an appeal. 

The non-partisan Congressional Budget Office estimated in an August report that cutting off the CSR payments would cause premiums for those who benefit from the payments to rise by 20 percent by 2018 and 25 percent by 2020.

Arizona has just two Affordable Care Act insurers in the federal marketplace, and no more than one in any county.

HealthNet provides coverage in Maricopa and Pima counties. Blue Cross Blue Shield insures Arizonans in the state's 13 other counties.

HealthNet's boosting insurance premiums next year an average 1.8 percent, according to filings with the State Department of Insurance.

Blue Cross's premiums are declining by less than 1 percent.

Blue Cross said in a statement to 12 News that it's not raising those premiums in response to the subsidy cutoff:

"Blue Cross Blue Shield of Arizona remains committed to the rates we have submitted. However, the lack of CSRs continues to add further instability to the market and cost to customers."

HealthNet did not respond Friday to requests for comment.

Nearly 20 states have sued the president over his decision to stop the payments to insurers. Arizona is not among them.

© 2017 KPNX-TV


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