WEBVTT - ACA Judge Refuses to Restore Subsidy Payments (Audio)

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<v Speaker 1>A federal judge has refused to force the Trump administration

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<v Speaker 1>to resume making disputed Obamacare subsidy payments to insurance companies.

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<v Speaker 1>After months of wavering, President Trump announced two weeks ago

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<v Speaker 1>that he would cut off the payments, that prompted eighteen

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<v Speaker 1>states in the District of Columbia to sue, claiming the

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<v Speaker 1>payments are required under the Affordable Care Act. But on Wednesday,

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<v Speaker 1>U S District Judge Vince Chabriya said he wouldn't order

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<v Speaker 1>resumption of the payments while the litigation plays out. With us.

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<v Speaker 1>To help explain all this is Brian Rye. He is

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<v Speaker 1>Bloomberg Intelligence's senior government analyst and he's here with me

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<v Speaker 1>in the studio in Washington. Brian, thanks for being being here.

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<v Speaker 1>Tell us a little bit first, just about these payments,

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<v Speaker 1>what they are, what they're what they're designed to do. Hi, Greg,

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<v Speaker 1>thanks for having me. These are c s R cost

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<v Speaker 1>sharing reduction payments that are mandated under the a c A.

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<v Speaker 1>And these are different from the tax credits that lower

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<v Speaker 1>income individuals can use to pay for the premiums. These

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<v Speaker 1>CSR payments are intended to help those uh those lower

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<v Speaker 1>income into the rules pay their out of pocket expenses,

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<v Speaker 1>their co pays, coinsurance deductibles, those things, and that at

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<v Speaker 1>play here is the fact that insurance companies have to

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<v Speaker 1>make those payments to lower income individuals on silver plans

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<v Speaker 1>under the A c A. What's not so certain is

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<v Speaker 1>whether or not the government is able to reimburse the

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<v Speaker 1>insurance companies for those payments, and that's at the heart

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<v Speaker 1>of this lawsuit. Brian, what was the judges reasoning in

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<v Speaker 1>refusing to restore the subsidies. I think the reasoning had

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<v Speaker 1>been that a this wasn't necessarily a new issue. The

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<v Speaker 1>threat that the Trump administration would terminate these payments had

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<v Speaker 1>been out there for for several months, and several states,

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<v Speaker 1>including California, who had taken the lead on this lawsuit,

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<v Speaker 1>had indicated that they were preparing to do this, either

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<v Speaker 1>by raising premiums to offset the cost or offset the

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<v Speaker 1>loss of these payments, or otherwise shielding affected individuals. And

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<v Speaker 1>so I think the judge rule that, look, um, you've

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<v Speaker 1>already had a chance to prepare in many states had

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<v Speaker 1>in fact prepared for that. So there's no need to

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<v Speaker 1>force the administration to do this. And I think we'd

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<v Speaker 1>go back to tying this to an the law student

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<v Speaker 1>at the House administered that the House of Representatives had

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<v Speaker 1>filed against the then Obama administration saying that, look, Congress

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<v Speaker 1>had not appropriated money for these CSR payments. So even

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<v Speaker 1>even though they were authorized by the A c A

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<v Speaker 1>and less Congress appropriates them, Um, you know, that's these

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<v Speaker 1>payments can't be made. And um that had been the

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<v Speaker 1>initial ruling that that a federal judge had agreed with. Well, Brian,

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<v Speaker 1>is the judge right in the sense that if he

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<v Speaker 1>says that the states have basically already prepared for these

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<v Speaker 1>payments uh not to be made. Uh? Is it the

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<v Speaker 1>case that these caut sharing the csrs are not really

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<v Speaker 1>as important as some of the critics of the president

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<v Speaker 1>have been saying. There, you know, it remains to be seen.

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<v Speaker 1>I think the feeling is that and when the CBO

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<v Speaker 1>looked at this, they said, there might be a slight

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<v Speaker 1>you know, loss of one million people, one million fewer

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<v Speaker 1>people might have insurance because of some insurers might decide

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<v Speaker 1>to pull out or other changes in there. But the

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<v Speaker 1>fact is, if premiums, if the gross premium or to

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<v Speaker 1>rise in the value of the tax credits that these

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<v Speaker 1>uh silver planned individuals would get would also rise as well,

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<v Speaker 1>So there might there shouldn't be a net impact, uh

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<v Speaker 1>to a lot of the people who you would think

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<v Speaker 1>would be affected by this. Now, again, if if insurers

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<v Speaker 1>decided to drop out, if there are other uncertainties and

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<v Speaker 1>maybe people have fewer choices, then that could obviously have

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<v Speaker 1>a bit of a problem. But again, I think the

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<v Speaker 1>judge rule that you've had time to prepare for this,

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<v Speaker 1>and and so that's enough. So Brian, the attorney generals,

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<v Speaker 1>the Attorney's General who won permission to defend the subsidies

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<v Speaker 1>in that case before the US Court of Appeals in Washington,

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<v Speaker 1>will that case be the determining factor here? It could be. Now,

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<v Speaker 1>at the same time that this is happening in the courts,

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<v Speaker 1>you do have an effort in Congress to to essentially

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<v Speaker 1>try and authorize those payments and make the court essentially moot.

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<v Speaker 1>You haven't what's the Alexander Murray agreement that would restore

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<v Speaker 1>or essentially provide appropriated funds for these payments for a

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<v Speaker 1>two year period and twenty nineteen UM That has some

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<v Speaker 1>support and Rich it's not clear if that's something that

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<v Speaker 1>they're going to bring to the floor. For a vote.

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<v Speaker 1>I wouldn't be surprised to see that happen before the

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<v Speaker 1>end of the year, perhaps in December, tied with the

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<v Speaker 1>budget battle that's going or the appropriations battle that's going

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<v Speaker 1>to take place in December. So I think in the

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<v Speaker 1>near term it's probably more important to keep an eye

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<v Speaker 1>on whether it's the Alexander Murray, the Hatch Brady, some

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<v Speaker 1>sort of compromise that would allow Congress to appropriate these

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<v Speaker 1>funds and settle the question that way. Brian only about

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<v Speaker 1>a minute left, But I guess one of the big

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<v Speaker 1>questions with any of those congressional proposals is whether the

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<v Speaker 1>president will support them. Where does he stand right now?

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<v Speaker 1>What day of the week is it? It's um you

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<v Speaker 1>is something that changes frequently. I think at the end

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<v Speaker 1>of the day, the President would like to be able

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<v Speaker 1>to sign something um that that that addresses this while

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<v Speaker 1>at the same time leaving the door open for another

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<v Speaker 1>attempt to repeal and replace the law. Longer term, uh,

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<v Speaker 1>sometime probably next year, once they're done with tax reform.

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<v Speaker 1>UM if they can do that, and then I think

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<v Speaker 1>the President would be happy to sign that, But he

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<v Speaker 1>doesn't want to be known as the guy who saved Obamacare.

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<v Speaker 1>I want to thank our guests. That's Brian Ray. He's

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<v Speaker 1>a senior government analyst for Bloomberg and told intelligence talking

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<v Speaker 1>to us about the new federal court ruling that refused

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<v Speaker 1>to force the Trump administration to again start making the

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<v Speaker 1>disputed Obamacare payments to insurance companies. I'm sure we'll be

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<v Speaker 1>talking about Obamacare more in the future. Coming up on

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<v Speaker 1>Bloomberg Law, the Trump administration weighs in in the case

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<v Speaker 1>of a California college student who was told he couldn't

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<v Speaker 1>hand out copies of the Constitution because he wasn't in

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<v Speaker 1>the school's designated free speech zone. We'll talk about that

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<v Speaker 1>court case coming up in a moment.