On Oct. 12, 2017, the White House announced that the federal government will no longer reimburse insurers for the ACA’s cost-sharing reductions made available to low-income individuals through the Exchanges. This is the latest action the Trump administration has taken in its efforts to dismantle the ACA. According to the administration, the federal government cannot lawfully make the cost-sharing reduction payments because there is no Congressional appropriation for those expenses.
The administration plans to end these payments effective immediately. Eliminating the ACA’s cost-sharing reductions could have a significant impact on individuals who enroll through the Exchange during the upcoming open enrollment period, which begins on Nov. 1. However, despite this announcement, premium tax credits—the other type of federal subsidy available through the Exchanges—will continue to be available.