Self-employed people — the entrepreneurs prized by vibrant economies — would be hurt most by President Donald Trump’s latest attempt to undermine the already rattled individual insurance market.
Kentuckian Betsy Foster, for example, fears rising premiums will force her to abandon her health-care consulting business and seek a job with a larger company just to be able to afford insurance.
Also hurt would be taxpayers. Trump’s move would cost the government more than it would save, which by any definition is irrational. The Congressional Budget Office has said Trump’s move would increase federal budget deficits by $194 billion over the next decade.
Taxpayers should not have to foot the bill for Trump’s act of spite against Barack Obama’s signature achievement, the Affordable Care Act, which remains the law unless and until Congress changes it.
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This avoidable crisis has spawned rare cooperation in the U.S. Senate as both Republicans and Democrats are rallying behind a plan to stabilize the individual insurance market.
At least 20 Democratic state attorneys general — including Kentucky’s Andy Beshear — have gone to court to reverse the order. They stand a good chance of prevailing, but not necessarily in time to help people who have from Nov. 1 to Dec. 15 — less than half the time from previous years — to sign up on HealthCare.gov for coverage next year.
The administration also plans to shut down the health insurance sign-up site every Sunday morning except one, even though Sunday mornings are the most convenient time for many working people.
The ACA subsidizes insurance in two ways:
▪ If your household income is at or below four times the poverty line ($48,240 for an individual or $98,400 for a family of four), you qualify for the premium tax credit, which increases in tandem with premiums, so no one in this category pays more than 9.56 percent of their household income in premiums.
▪ If you’re on the poorer end, with household income at or below 250 percent of poverty ($30,150 for an individual or $61,500 for a family of four), you’re also eligible for a discount on co-pays and deductibles when you go to the doctor. The payment to insurers to meet this provision is what Trump, after months of threatening to do so, canceled.
The insurance companies by law must provide the help with out-of-pocket costs, so insurers will increase premiums to make up for the lost government aid. As premiums rise, the government will have to provide larger subsidies to those who qualify for the tax credit. That group won’t feel the increase.
The impact will fall on higher-earning, mostly self-employed people like Betsy Foster, who buy insurance on the individual market and don’t qualify for the tax credit — almost 18,200 Kentuckians.
Altogether, 92,311 Kentuckians purchase insurance in the ACA’s individual market. In large part due to the uncertainty created by Trump, individual premiums in Kentucky are rising an average 41 percent to 56 percent for 2018. No Kentucky county has more than one insurer offering individual policies.
Republicans have already voted in favor of a fix; provisions to temporarily continue the subsidies were in the failed Republican health care bills.
In the name of common sense, Congress must step in and stabilize the insurance market. Self-employed people could then see a reduction in their premiums or receive a refund.