Insurance, medical groups urge Trump to keep funding Obamacare subsidies

People march in a Save Obamacare rally in Los Angeles. REUTERS/Lucy Nicholson

WASHINGTON (Reuters) - Major medical groups kept up the pressure on U.S. President Donald Trump on Wednesday to maintain funding Obamacare subsidies that are paid directly to insurers, warning that not doing so would destabilize the individual insurance markets that millions of people use to buy health insurance.

America’s Health Insurance Plans, the American Medical Association, Blue Cross Blue Shield Association and the American Academy of Family Physicians were among eight organizations that penned a letter to Trump. They urged him to “remove uncertainty about continued funding for cost sharing reductions,” the billions of dollars that are paid to insurers to help cover out-of-pocket medical expenses for low-income Americans.

On Tuesday, the Trump administration said it had not yet made a decision on whether it would continue funding the subsidies. “The administration is currently deciding its position on this matter,” said Alleigh Marré, a national spokeswoman for the Department of Health and Human Services.

“No decisions have been made about how the administration will proceed,” she said.

House of Representatives Republicans sued the Obama administration for funding the subsidies, which they argue have to be appropriated by Congress. A federal judge in May 2016 ruled in favor of the Republicans, prompting an appeal by the Obama administration. The case is pending in the U.S. Court of Appeals for the District of Columbia Circuit.

Without the subsidies, the letter on Wednesday said, more insurers could leave the Obamacare exchanges, premiums for 2018 and beyond would rise, and providers would have additional uncompensated care costs, because they would not receive payments that help cover the costs of low-income patients.

Insurers have to submit their rates for 2018 plans over the next several weeks and are grappling with whether they will receive the subsidies, which amount to about $7 billion a year.

Reporting By Yasmeen Abutaleb; Editing by Steve Orlofsky