Trump Will Not Continue Obamacare Payments for Poor Americans, Judge Rules

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President Trump celebrates after signing his executive health care order to facilitate U.S. health insurance plans bought outside of Obamacare rules. REUTERS/Kevin Lamarque

On Wednesday, a federal judge in San Francisco denied an emergency motion to force the Trump administration to pay cost-sharing government subsidies that help low-income Americans afford Obamacare. The motion was filed last week by Democratic attorneys general from 18 states and the District of Columbia.

U.S. District Judge Vince Chhabria, an Obama appointee, was skeptical of the case and claimed that most states had already anticipated the change in funding and established practices to stabilize premiums.

"Why have all these attorneys general rushed to court seeking an emergency ruling against President Trump?" he wrote in his 29-page opinion. "State regulators have been working for months to prepare for the termination of these payments...the truth is that most state regulators have devised responses that give millions of lower-income people better health coverage options than they would otherwise have had."

Early this month, President Donald Trump announced that he would stop funding the subsidies that reimburse insurers for reducing the co-pays and deductibles of lower-income Obamacare enrollees. This was one measure in a larger strategy to unravel the infrastructure supporting the Affordable Care Act.

The subsidies are estimated to cost $7 billion this year and $10 billion in 2018. Trump argued that insurance companies are profiting from the subsidies, while insurance companies said they pass the money directly to consumers.

Chhabria also rejected the notion that some Obamacare enrollees would be confused by the ruling. "If the states are so concerned that people will be scared away from the exchanges by the thought of higher premiums, perhaps they should stop yelling about higher premiums," he wrote.

The U.S. government began paying insurance subsidies for the nearly 6 million qualifying Americans in 2014, but the Trump administration and Obamacare critics claim that Congress never actually appropriated the money for these reimbursements.

"The administration cannot fix Congress's error, because the Constitution prevents the administration from making payments on its own," said Chhabria.

Attorneys general in California, Connecticut, Delaware, the District of Columbia, Illinois, Iowa, Kentucky, Maryland, Massachusetts, Minnesota, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont; Virginia and the state of Washington filed the suit.