San Diego

Trump Cuts to Obamacare Challenged in Federal Court

Backed by seventeen other states, the lawsuit challenges President Trump's halt to subsidies for deductibles and co-pays under Obamacare

A lawsuit aimed at keeping health care affordable for lower-income people got its first federal court hearing Monday in California.

Backed by seventeen other states, it challenges President Trump's halt to subsidies for deductibles and co-pays under Obamacare.

Those subsidies have benefitted nearly 6 million people for almost four years.

But Republican critics say Congress didn't formally authorize that money going to insurance companies.

Without it, industry observers say Obamacare could be destabilized.

"The premiums go way up for folks,” says Paul Downey, chairman of the California Commission on Aging. “The benefits go down, particularly for younger workers who are going to accept a cheaper plan with fewer benefits. Or older workers, they're either going to see significant premium increases, or they're going to see benefits go down or some combination of both."

In expectation of the co-pays and deductibles being halted, a lot of healthcare insurers already have hiked their rates for next year.

Last year, a federal judge ruled that those subsidies didn't get the necessary approval from Congress.

But that's now on appeal.

"What's frustrating is that Congress is not focused on fixing the fundamental problems,” Downey says. “We're caught up in the same old turf battles and divisive politics that we've been dealing with."

With 10 million people enrolled in Obama, Republicans and Democrats have reached across the aisle, hoping to head off the most pessimistic predictions.

"There's an opportunity,” says Downey. “But right now, what's on the table would completely devastate the insurance markets and cause premiums to go up for people who can't afford to pay them."

At a court hearing in San Francisco this afternoon, state attorneys asked the judge to order the government to reinstate the subsidy payments.

He delayed an immediate ruling.

Contact Us