With the Republican plan to replace ObamaCare in retreat, the next phase of the fight hinges on the wonky-sounding factor of "cost-saving reduction payments." As the New York Times explains, these are subsidies paid by the federal government to insurers to defray costs for lower-income policy holders. President Trump, referring to them as "bailouts," has threatened to end them, a move that would roil the markets. GOP Sen. Lamar Alexander has implored Trump not to do that, and he says the Senate health committee will start work in September—with Democrats—on legislation to "stabilize and strengthen the individual health market" for 2018. A similar bipartisan push to shore up the markets is underway in the House. In the meantime, uncertainty about the subsidies and other factors is already pushing up projected premiums for 2018, reports the Wall Street Journal.
In the worst cases, the newspaper cites requests by big insurers to raise premiums 30% in Idaho, West Virginia, South Carolina, Iowa, and Wyoming, and hikes of 20% in New Mexico, Tennessee, North Dakota, and Hawaii. These are preliminary rate requests and could change by the time they're finalized at the end of September. Trump has made no secret that he'd like to see the Affordable Care Act "implode," and cutting off the subsidies is one way to help make that happen. Whether he can do so legally, however, is a matter still being hammered out in the courts, notes the Washington Post. In fact, a federal appeals court ruled Tuesday that attorneys general from 16 states who support the subsidies can weigh in on the case, which doesn't bode well for Trump's threat. Another uncertainty is whether the feds will enforce the individual mandate, which requires people to sign up for insurance or pay a penalty. (Read more ObamaCare stories.)