After months of veiled threats, President Trump formally announced that his Administration will cease funding Cost-Sharing Reduction (“CSR”) payments, a key component of the Affordable Care Act (“ACA”) intended to help subsidize insurance coverage for low income individuals. As we have eluded to in prior articles, various industry stakeholders and interest groups have expressed anxiety over the past few months regarding the future of these payments under the Trump Administration. Not surprisingly, the President’s formal announcement was met with a rash of fierce condemnation by many of these stakeholders and interest groups, who maintain that this action will lead to increased premiums, the exit of insurers from ACA healthcare exchanges, and general insurance market instability. Meanwhile, others, including the Attorneys General of New York and California, have pledged to sue to defend CSRs.

As the effects of this maneuver continue to be felt, we will be publishing additional blog posts on various elements of this decision.