The Trump administration will continue to pay cost-sharing reduction subsidies for now, according to Politico.
The decision is a compromise between Democrats and Republicans as they negotiate a budget to avoid a partial government shutdown that would begin Saturday if no agreement is reached.
Cost-sharing reduction subsidies were created under the ACA to help offset the cost of providing discounted deductibles to low-income ACA enrollees. These payments — which total roughly $7 billion each year, according to Politico — were authorized and paid for by the executive branch under the Obama administration. However, two years ago, House Republicans filed a lawsuit questioning the legality of the payments because no specific appropriation was created for them. The Trump administration delayed the lawsuit in February while it decided whether to continue the payments.
Democrats wanted Republicans to make a long-term commitment to fund cost-sharing reductions by including them in the spending package. However, House Speaker Paul Ryan, R-Wis., made it clear Republicans would not agree to that. "CSRs, we're not doing that," he said, according to another Politico report. "That is not in an appropriation bill, that's something separate that the administration does."
House Minority Leader Nancy Pelosi, D-Calif., and Budget Director Mick Mulvaney made the deal for the executive branch to continue funding the cost-sharing reductions over the phone Tuesday. However, it is not clear how long the payments will continue, according to Politico.
"Our major concerns in these negotiations have been about funding for the wall and uncertainty about the CSR payments, [which are] crucial to the stability of the marketplaces under the ACA," Ms. Pelosi said in a statement. "We've now made progress on both of these fronts."
A recent analysis from the Kaiser Family Foundation suggested eliminating the cost-sharing reductions would actually cost the federal government $2.3 billion due to increases in premium tax credits, even after accounting for savings.
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