• Two senators from either side of the political aisle released a bipartisan deal to shore up the Obamacare markets Tuesday.
• Key Republicans, including President Donald Trump and House Speaker Paul Ryan, have already come out against some or all of the package.
• It could seriously damage the chances of getting the bill passed.

With the Republican attempts to repeal and replace the Affordable Care Act on ice for now, two senators from either side of the aisle are trying to shore up the law's insurance exchanges in the meantime. Resistance from leading Republicans, however, could sink the attempt.

The bill from GOP Sen. Lamar Alexander and Democratic Sen. Patty Murray — the leaders of the Health, Education, Labor, and Pensions (HELP) Committee — would help pump some funding back into the exchanges to ensure costs for consumers stay low while also allowing states more flexibility to try their own fixes for exchanges.

Here's a rundown of some major pushback the package received so far:

• President Donald Trump: Trump specifically took issue with the inclusion of cost-sharing reduction (CSR) payments, which he calls "bailouts" for insurers. The Alexander-Murray deal would fund these payments, which offset insurer losses incurred by providing plans with low out-of-pocket costs for poorer Americans. Trump said he did support Alexander's work more broadly, however.
• House Speaker Paul Ryan: Ryan previously said of a stabilization package, before this version was finalized, that he would not bring such a bill to the House floor. A spokesperson reiterated that Wednesday. "The speaker does not see anything that changes his view that the Senate should keep its focus on repeal and replace of Obamacare," Ryan's office said.
• Sen. Orrin Hatch, chair of the Finance Committee:"It would last two years and spend a whopping amount of money and not solve the problem," Hatch told reporters Wednesday.
• Republican Study Committee chair Mark Walker: The head of the roughly 150-member group in the House also came out against the package on Tuesday. "The GOP should focus on repealing & replacing Obamacare, not trying to save it," Walker said via Twitter. "This bailout is unacceptable."
• Conservative action groups: FreedomWorks, Heritage Action, and Club for Growth all disavowed the package, painting it as a betrayal of the Republican promise to repeal and replace Obamacare.

Republican Sen. John Kennedy said Trump's reversal on the bill likely means the push is dead for now.

"I think that probably kills the effort," Kennedy told Fox Business Network. "Senator Alexander and Senator Murray have worked very hard. Not sure what all was in their proposal. I understand the money we have to pay. I want to know what the American tax payer’s getting for it. But I think if President Trump has come out against it it’s all an academic question now. My guess is the effort is dead."

Sen. John Thune, the third-highest ranking Republican in the Senate, told reporters that the bill is "stalled out."

Some Republicans have supported the bill, however. Sen. Bob Corker, who like Alexander is from Tennessee, said he would cosponsor the bill. And Sens. John McCain and Susan Collins, both Republican holdouts from previous attempts by the GOP to repeal and replace Obamacare, also said they supported the push on Tuesday.

According to Axios' Jonathan Swan, more cosponsors for the bill will be announced soon.

The biggest question, however, is whether Senate Majority Leader Mitch McConnell would bring the bill to the floor for consideration at all.

While there could be some push for the bill over the next few weeks, Rick Weissenstein of Cowen Washington Research Group said in a note to clients that the GOP resistance could put the effort on ice until the year-end negotiation over government funding.

"Statements this morning by President Trump and House Speaker Paul Ryan critical of the deal reached between Sens. Lamar Alexander and Patty Murray should not be taken as a death knell for the bill. It was always unlikely that the measure would move on its own," Weissenstein said.

He added: "The more likely scenario is that Alexander-Murray gets wrapped up in what is likely to be a very large year-end measure."

SEE ALSO: Trump says he 'can never support' a key part of bipartisan Obamacare stabilization deal

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• President Trump cut off key Obamacare subsidies known as cost-sharing reduction (CSR) payments on Thursday.
• Blue Cross Blue Shield of North Carolina announced Wednesday that it would increase premiums for Obamacare exchange plans by 14.1% for 2018.
• BCBS NC said if Trump did not cut off CSR payments, premiums increases would've "been near zero."

President Donald Trump's decision to end key Obamacare payments is already reverberating throughout the health insurance market.

Blue Cross Blue Shield of North Carolina (BCBS) announced its final Obamacare exchange premium increases for 2018 on Wednesday, and it pinned a significant amount of the increase on Trump.

The insurer, which covers all 100 counties in North Carolina, said the average premium increase for exchange plans would be 14.1%, much lower than the 22.9% originally requested, but much higher than it could have been.

BCBS said it was forced to increase premiums due to lost funding from Obamacare's cost-sharing reduction (CSR) payments, which help offset insurers' costs incurred by offering low out-of-pocket cost insurance plans to poorer Americans.

"Had CSR payments not been eliminated, Blue Cross NC’s final rate request for ACA customers’ average would have been near zero; however, most customers receiving premium assistance will see that assistance rise in 2018 to offset the higher increase that was needed," said a statement from BCBS North Carolina about the final premium increases.

On Thursday, the White House announced Trump was cutting off the payments for the rest of 2017 and going forward. The payments were in dispute as they were being paid through the executive branch and were not appropriated through Congress. The administration said it could no longer continue to do so legally.

Ultimately, these increased costs will filter to the federal government for the most part. Since most people in the exchanges receive a subsidy to help with premiums, the increase will fall to Washington rather than people's wallets.

There is a slice of people in the market, roughly 10% according to BCBS NC, who do not receive the tax credit and will therefore bear the brunt of the increase caused by the lost CSRs.

The announcement comes just a few days after a similar announcement from the Department of Insurance in Pennsylvania. According to the department, the average Obamacare premiums in the state would increase 30.6% in 2018, up from 7.6% if the CSRs continued.

Bipartisan legislation to appropriate the CSRs through Congress was released Tuesday, but Trump and other top Republicans came out against the measure Wednesday, throwing its future into doubt.

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• The bipartisan Alexander-Murray Obamacare stabilization bill debuted on Tuesday.
• The bill's authors announced 24 co-sponsors in the Senate, 12 in each party.
• GOP leadership, especially President Donald Trump, still needs to get on board for it to pass.

The push to stabilize the Obamacare individual insurance exchanges is getting some key support in the Senate, but there is one major hurdle the bill must jump in order to pass.

On Tuesday, Sens. Lamar Alexander and Patty Murray debuted their bipartisan stabilization package for the exchanges, which included both funding to support the marketplace and provisions to allow states some flexibility to customize their healthcare markets.

The bill drew praise from many Democrats, including Senate Minority Leader Chuck Schumer, for shoring up the market and protecting consumers. More importantly, it also drew support from Republican members.

In fact, Alexander announced that 11 other GOP senators will co-sponsor the legislation. They are:

• Mike Rounds (SD)
• Lindsey Graham (SC)
• John McCain (AZ)
• Bill Cassidy (LA)
• Susan Collins (ME)
• Joni Ernst (IA)
• Lisa Murkowski (AL)
• Charles Grassley (IA)
• Johnny Isakson (GA)
• Richard Burr (NC)
• Bob Corker (TN)

The mix includes moderates who were against the attempts by Republicans this past summer to repeal and replace Obamacare (Murkowski, McCain, Collins), the authors of the last attempt at repeal (Graham, Cassidy), and both senators from Iowa — a state that had its own waiver to stabilize the Obamacare marketplace denied by the Trump administration.

Given the number of cosponsors, if all of the Democrats support the proposal and the bill is brought to the floor, it would have a filibuster-proof majority.

There is one issue, however. The bill may never see the floor.

Senate Majority Leader Mitch McConnell has been mum on the Alexander-Murray plans and other Republican leaders, including Senate Finance Chair Orrin Hatch and House Speaker Paul Ryan, came out against the bill after its release.

Schumer told reporters that all 48 Democratic members would vote for the bill and urged McConnell to put the bill on the floor.

"Now that a number of Republican Senators have come forward to support this sensible, bipartisan package, I strongly urge Leader McConnell to put it on the floor without delay," Schumer said. "If he does, it is virtually certain that it would pass."

Perhaps, most importantly, however, would be support from President Donald Trump. The president has sent incredibly mixed signals on the bill over the past two days. Press Secretary Sarah Huckabee Sanders said Wednesday that as it stands right now Trump is not on board with the proposal. 

What it would take for Trump to get on board is unclear, but Alexander told reporters that Trump called him on Wednesday night to encourage him to keep working on the bill.

"So, I have great respect, as you know, for both of the senators that you mentioned and if they can come up with a short term solution," Trump said Thursday during a White House meeting with Ricardo Rosselló, the governor of Puerto Rico. "What I did say though is, I don't want the insurance companies making any more money... than they have to."

If Trump comes out in support of the Alexander-Murray bill, it would go a long way in getting it passed.

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• The percentage of Americans without health insurance increased to 12.3% in the third quarter.
• This is an increase of 0.6 percentage points from last quarter, and 1.4 points from a year ago.
• Gallup said the increase is in part due to "Congressional Republicans' attempts to replace" Obamacare.

The percentage of Americans living without health insurance ticked up in the third quarter, according to a new Gallup-Sharecare poll.

12.3% of Americans are currently without insurance, an increase of 0.6 percentage points from the second quarter and up 1.4 percentage points from its historic low a year ago when President Donald Trump was elected.

According to Gallup, this is the highest the uninsured rate has been since the fourth quarter of 2014.

While the increase seems small in terms of percentages, the raw number of people is still tremendous.

"However, the 1.4-point increase in the percentage of adults without health insurance since the end of last year represents nearly 3.5 million Americans who have entered the ranks of the uninsured," said a blog post from Gallup on the poll. 

The reasons for the rise in the number of uninsured are diverse ranging from insurer participation in the Obamacare exchanges to healthcare costs, according to a post from Gallup. The attempts by Trump and congressional Republicans to repeal and replace Obamacare also could having an impact.

"Uncertainty about the healthcare law also may be driving the increase," Gallup said. "Congressional Republicans' attempts to replace the healthcare law may be causing consumers to question whether the government will enforce the penalty for not having insurance."

Despite the uptick, the uninsured rate is still well below its pre-Obamacare level of 18%.

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• On October 12, President Trump signed an executive order that seeks to expand access to cheaper, skimpier health plans. 
• Later that day, his administration also said it will end key payments that lower insurance costs for poorer Americans.
• The good news is that, for the immediate future, many Americans won't be affected, though some may have higher premiums.
• There are still a lot of unknowns.

On October 12, President Trump's administration made two major announcements regarding Obamacare, officially known as the Affordable Care Act (ACA). The New York Times characterized them as "twin blows" to the healthcare law, which makes sense: Trump has made no secret of his desire to repeal and replace Obamacare.

That morning, Trump signed an executive order that asked federal agencies to make new rules that would expand access to cheaper, bare-bones health plans. Later that day, the White House announced that the government will stop making key ACA payments that reduce healthcare costs for lower-income Americans. 

What does that jumble of buzzwords actually mean for you? Here's a simple guide.

People who are on Medicaid or Medicare are not affected by this news. But people who buy their own insurance (or get it through work) might be.

None of this news will affect people with Medicaid or Medicare, the New York Times reported. People who work for large employers and get health insurance through work are also not likely to be affected, the Times noted.

But if you buy your own insurance through the Obamacare marketplace, or if you work for a small business that provides your insurance, there may be changes in store. 

The executive order is all about expanding access to cheaper (but worse) insurance.

Before we talk about the specifics of this executive order (EO), let's clear up one thing: It didn't actually change any laws. Instead, the New York Times explained, it just asks federal agencies to make new regulations for certain types of health care plans. Business Insider reported that such regulations would most likely go into effect in 2019 at the earliest.

The EO discusses two types of plans in particular: short-term health plans and association health plans.

Short-term plans are just what they sound like: They insure people for a short amount of time. They're also cheap, but provide little coverage. Under Obamacare, people can't buy short-term plans that exceed 90 days. But Trump's executive order calls for allowing these plans to last as long as 364 days, according to Business Insider. 

Association health plans are a bit more complex. They let small businesses and individuals pool together to buy insurance, which can help them get plans with cheaper premiums. Trump's EO calls for a loosening of the rules that govern these plans, according to the New York Times. The plans would not be subject to certain Obamacare rules about minimum coverage, meaning they could be even cheaper. But that also means members of the plans would also get skimpier coverage.

Since the EO could open the door for more small businesses to band together on association plans, people who get insurance through a job at a small business could be affected by the EO eventually, as the New York Times noted. 

Right now, we still don't know exactly how or when the executive order will play out.

Experts fear that expanding access to association and short-term health plans would attract young, healthy people who want to pay lower prices for skimpier coverage. That might be great for those young, healthy people, but it could also create higher costs for the older, sicker people who get left behind in the Obamacare marketplace, Business Insider reported.

But, as mentioned above, no changes to the law have been made yet. We'll know more once federal agencies actually start proposing new regulations. 

Trump's second action — shutting down key government payments — could raise premiums. 

The White House announced that the government is going to stop making cost-sharing reduction (CSR) payments. Here's how they work. 

In Obamacare marketplace plans, people who make less than 250% of the poverty level ($30,150 a year for an individual; $61,500 a year for a family of four) get a break on their out-of-pocket costs. That includes deductibles, copayments, and coinsurance. Insurance companies give lower-income customers plans with lower out-of-pocket costs, and then the federal government pays the insurers back. 

Last year, 7 million Americans benefited from CSR payments, according to nonpartisan health policy group the Kaiser Family Foundation. On average, the payments lowered their out-of-pocket costs by $1,000 per person, though the actual discount varies based on income.

Trump's administration said it "cannot lawfully" make the payments anymore.

Back in 2014, the Republican-controlled House of Representatives sued the Obama administration over CSR payments, Business Insider reported. They argued that the payments were unlawful because the money used to make them was never actually appropriated by Congress. (That's true.)

In 2016, a court sided with the House Republicans, but the Obama administration appealed the ruling. The case is still not resolved, but the CSR payments are still being made — at least, they were, until the Trump administration's announcement last week. 

Stopping these payments may give you higher premiums, if you buy insurance through the Obamacare marketplace. 

Even though CSR payments have ended, insurers in the Obamacare marketplace are still legally required to offer those low out-of-pocket costs to lower-income Americans who qualify for them. So how will they make up for the missing CSR payments? Raising premiums on plans sold through the Obamacare marketplace. (A premium is that amount of money that you pay every month for your health insurance.) Some insurers have already started to do that. 

But premiums won't go up for everybody who buys a plan through Obamacare.

Obamacare also has something called premium subsidies— they lower the cost of premiums for people who make  less than 400% of the federal poverty level (that's $48,240 a year for an individual; $98,400 a year for a family of four). People who qualify for lower premiums are still going to get them, and will be "largely protected" from any increases, according to Vox.

That's a huge group of people. According to government data released earlier this year, 84% of people enrolled in Obamacare marketplace plans were getting these premium subsidies. 

Now here's the bad news: For the smaller share of people who buy plans through the Obamacare marketplace but make too much money to qualify for premium subsidies, premiums are likely to go up, according to Business Insider. 

Ultimately, all this means that most premium hikes, "will fall to Washington rather than people's wallets," as Business Insider's Bob Bryan wrote. In fact, the Congressional Budget Office estimated ending CSR payments will increase the federal deficit by $149 billion over 10 years, NPR reported.

A bunch of states have sued the Trump administration, and Congress might take action. 

On October 13, Reuters reported that 18 states sued the Trump administration to try and block the cut of CSR payments. But right now we don't know what the outcome of these lawsuits will be.

There's another way that CSR payments might be preserved: Congress can write a law that officially appropriates the money to keep them going. Right now there is a bipartisan effort to pass such a law, and lots of senators have signed on, but there's still no guarantee that it'll pass. 

If neither of these interventions works, it's possible that some insurers will pull out of the Obamacare marketplace, threatening its overall stability, Business Insider reported. But for now, a lot of these big-picture outcomes are still up in the air. 

Have more questions about Obamacare and signing up during open enrollment? Visit healthcare.gov. 

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• Analysts at Morgan Stanley say hospitals are already feeling the repercussions of uncertainty surrounding the Affordable Care Act.
• According to their analysis, there is a correlation between the percentage of uninsured Americans and bad debt at hospitals.
• In Q3 2017, the percentage of uninsured Americans hit its highest rate since 2014.

In a note to clients out Monday morning, analysts at Morgan Stanley outlined what's in store for hospitals as uncertainty over the Affordable Care Act changes our healthcare system at large.

That is to say — they're considering what will happen as the ACA changes from Obamacare to Trumpcare. 

What they've found is unsettling, but unsurprising. There is "a strong relationship between uninsurance rate and average bad debt as a percentage of revenue for our coverage," according to the bank. 

That is to say that as fewer people are uninsured, hospitals will start to see their finances come under pressure. This isn't something to worry about in a few months or years, either. It's already happening. This quarter, the percentage of uninsured people in the US climbed to 12.3%, its highest rate since 2014. Analysts attribute that to the destabilization of exchanges, shorter enrollment periods and rising premiums — all factors that have pushed people, especially young people, away from the ACA. 

From Morgan Stanley:

"Challenging political and regulatory environment will likely impact bad debt / uncompensated care in our facilities coverage beyond 3Q17. Given the recent executive order by President Trump and subsequent decision to suspend CSR subsidies, we see near-term headwinds for hospitals through either low volume or increased bad debt (see here)...

As an analog, we note that the improvement in the uninsured rate from ~17% in 2013 to ~10% in 2016 saw an average improvement in bad debt /uncompensated care as a percentage of revenue of ~250 bps in our coverage. Now that the uninsured rate has moved 200 bps in the opposite direction over the past 3 quarters, we expect earnings pressure from increasing bad debt to persist as we head into 2018."

The bank notes that Lifepoint and Universal Health Services are in the most precarious positions of the companies in its coverage. 

Ultimately, however, this is going to impact everyone, especially the hospitals that will have to start making difficult choices that are disruptive for patients. They may have to stop providing certain services, or even be forced to sell off assets, changing access for patients.

Last week, the Federal Reserve's Beige Book survey of American business sectors had a warning about this kind of behavior. It was really short, but its implications for what our healthcare system will look like over the next few years is massive.

Here it is [emphasis ours]:

"Reports from healthcare firms remain mixed. Employers continue to streamline operations in an uncertain environment, with one major employer shifting jobs from low-profit to high-profit areas."

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• Two GOP committee leaders, Rep. Kevin Brady and Sen. Orrin Hatch, released their own plan to stabilize the US healthcare system.
• The plan would appropriate the key payments introduced by the Affordable Care Act but also do away with the law's individual and employer mandates.
• The plan would be unlikely to stabilize the individual market and would face a difficult time in the Senate.

Two Republican leaders on Tuesday announced their own package to temporarily shore up the Obamacare exchanges, but the deal appears to be as much a repeal of the law, formally known as the Affordable Care Act, as a fix for it.

Healthcare has attracted renewed interest from lawmakers after President Donald Trump announced that he would end cost-sharing reduction payments, or payments by the government to insurers designed to offset the costs of providing affordable coverage to poor people.

Rep. Kevin Brady, the chair of the House Ways and Means Committee, and Sen. Orrin Hatch, the chair of the Senate Finance Committee, rolled out a four-point plan for the Obamacare exchanges that funds the payments payments while also stripping away the law's cornerstone mandates.

The plan is an alternative to the bipartisan Alexander-Murray deal, a plan designed to fix the Obamacare markets that appears to have enough support in the Senate to pass.

The key aspects of the Brady-Hatch plan are:

1. Fund CSR payments through 2019: The plan also says there are "pro-life" protections on the payments, which most likely means restrictions on using the payments for plans that cover abortions. The plan also hints at guardrails for the use of these payments but does not specify them.
2. Suspend the individual mandate from 2017 to 2021: The plan would remove the financial penalty for people who do not purchase healthcare coverage.
3. Refund employer mandate penalties incurred from 2015 to 2017: Any penalties companies paid for not offering health insurance to their employees over the past three years would apparently be refunded.
4. Expand the use of health savings accounts: The plan wants to increase the contribution on these tax-deductible accounts.

Hatch and Brady painted the plan as a way to help boost the markets while also addressing underlying issues with Obamacare.

"What we're proposing not only helps treat some of Obamacare's symptoms — rising premiums, fewer choices, and uncertainty and instability," Brady said in a statement announcing the plan. "It takes steps to cure Obamacare's underlying illness through patient-centered reforms that deliver relief from federal mandates, protect life, and increase choices in healthcare."

The repeal of the mandates, however, could seriously undermine the health of the Obamacare exchanges, according to Larry Levitt, a senior vice president at The Kaiser Family Foundation, a nonpartisan health-policy think tank.

"Getting rid of the individual mandate for five years without anything to replace it is kind of the opposite of market stabilization," Levitt tweeted after the release of the plan.

Thus, it is unlikely this plan gathers much steam, especially in the Senate, where it would be subject to a Democratic filibuster.

The full text of the Brady-Hatch plan will be released later, the statement said.

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• The biggest question for the future of the US healthcare system is whether President Donald Trump will undermine or support the Obamacare exchanges.
• Trump could support the bipartisan Alexander-Murray deal and help to shore up the market. Or he could take actions to undermine the system further, like denying state stability waivers.
• Trump appears to be leaning toward destruction.

Since the start of the Trump administration, the future of President Barack Obama's landmark Affordable Care Act (ACA) has been in doubt.

Republicans spent the first eight months of Donald Trump's presidency attempting to repeal and replace the ACA, also known as Obamacare, but have ultimately come up short for now.

Now, as the beginning of the open enrollment period for the law's individual insurance exchanges looms (people can sign up starting November 1) and the legislative attempts to dismantle the law are on ice, what Trump will do about the law has become the key issue for the future of the healthcare system.

On the one hand, most Americans will place any problems with the exchanges and Obamacare going forward on the head of Trump and the GOP, according to polling. This would seem to give Trump a reason to try and fix the law in the short term instead of blowing it up.

On the other hand, Trump long stated his desire to blow up the healthcare exchanges in order to get Democrats to negotiate on a replacement deal.

So the questions remains: Will Trump save Obamacare or destroy it?

Save

The easiest way for Trump to help bolster the Obamacare markets would be to signal support for the bipartisan Alexander-Murray deal.

The bill — crafted by Republican chair of the Senate Health, Education, Labor, and Pensions committee Lamar Alexander and the committee's Democratic ranking member Patty Murray — would help fund the cost sharing reduction (CSR) payments, boost spending on advertising for the upcoming open enrollment period, and provide extra flexibility to states.

As of now, the bill has the support of every Democratic senator and at least 12 Republicans who are co-sponsoring it. Additionally Rep. Mark Meadows, chair of the conservative House Freedom Caucus, called the bill "a good start" while saying that there would still need to be a few adjustments.

If Trump were to come out in favor of the bill, there is a good chance it could pass. Besides the obvious stabilizing the items in the bill itself, support from Trump could help ease some of the worries from insurers about the marketplace going forward.

Destroy

Trump already took significant steps to undermine the health of the markets over the past few weeks.

Perhaps most damaging was the decision to end the CSR payments, which had already led to insurers increasing their premiums for 2018. While most of this cost will eventually fall on the federal government, there is another danger in the decision, according to Matthew Fiedler, a health policy expert at the Brookings Institution.

"Some insurers may conclude that operating under this type of uncertainty is intolerable and decide to simply cut their losses," Fiedler told Business Insider. "That could leave some enrollees without any options at all for purchasing coverage. These types of outcomes are particularly likely in states that did not allow insurers to raise premiums to account for the possibility that CSRs would not be paid in 2018."

In addition to ending the CSR payments, the president signed an executive order allowing the expanded use of association health plans, which allow employees of small businesses the option to band together and purchase plans as a group. The order could help undermine the Obamacare exchanges, according to experts.

Taken together, these moves already show a preference toward blowing up the law.

"Not one of the Trump administration’s actions is crippling to the ACA’s marketplace, but the cumulative effect could be quite damaging," Larry Levitt, a senior vice president at the Kaiser Family Foundation, a nonpartisan health policy think tank, told Business Insider.

If Trump wanted to further destroy the exchanges, he also has simple options in front of him.

The simplest of steps would be to reject the Alexander-Murray deal. Senate Majority Leader Mitch McConnell said Sunday that he would bring the bill to the floor if Trump supports the deal and would sign it. By coming out against the idea, Trump could prevent the market stabilization package from making it to law.

Additionally, a plan proposed by Rep. Kevin Brady, chair of the House Ways and Means committee, and Sen. Orrin Hatch, chair of the Senate Finance committee, would likely have no hope in the Senate and possibly undermine the exchanges even more. If Trump were to throw his weight behind that plan instead, it would still be unlikely to become law and leave Obamacare with no real support.

Other steps Trump could take are also fairly simple. He could instruct his Department of Health and Human Services to continue denying waivers from states that are attempting to stabilize their markets. Also, the HHS's current budget for enrollment advertising is already significantly lower than previous years', and keeping ad costs low is another way to undermine the exchanges.

Which will he choose?

So far, indications appear to point to Trump continuing to aide the collapse of the healthcare market.

The president withheld direct support for the Alexander-Murray deal, and his legislative aides have suggested changes to the plan in order to win Trump's support that would doom the bill with Democrats. Some of these include eliminating the individual mandate and changing key regulations on insurance plans.

The final decision by Trump, however, is unclear.

Sen. John Cornyn, the second-highest ranking Republican in the Senate, merely shrugged when asked what the president thought of the Alexander-Murray bill. Sen. Shelley Moore Capito, a Republican from West Virginia, told Politico, "It's safe to say the president's been unclear."

Additionally, the Trump administration has yet to approve a waiver from the Republican-controlled Iowa government that would help to shore up that state's exchange.

Even Trump's recent comments that Obamacare is "dead" and "no longer exists" help sow uncertainty and could suppress enrollment for next year.

"Through all of these actions, the Administration is sending a strong signal that it wants the individual market to fail," Fiedler said.

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• The Congressional Budget Office released its score on the bipartisan Alexander-Murray Obamacare fix legislation.
• The score showed the bill would shrink the federal deficit by $3.8 billion over 10 years.
• The score did not include estimated coverage changes from to the funding of cost-sharing reduction payments due to CBO rules.

The Congressional Budget Office released its assessment of the Bipartisan Health Care Stabilization Act of 2017, better known as the Alexander-Murray bill aimed at providing fixes to the Affordable Care Act.

The bill from Sen. Lamar Alexander, the chair of the Senate Health, Education, Labor, and Pension Committee, and its ranking member Patty Murray, is designed to stabilize the Obamacare exchanges over the next few years.

Here's a quick rundown of the major findings:

• The bill would save the government $3.8 billion from 2018 to 2027.
• It would not change the number of people with insurance coverage.
• More states would take advantage of Obamacare's innovation waivers — or so-called 1332 waivers — due to relaxed restrictions on the waivers and an expedited process.
• Easing restrictions on catastrophic plans would decrease premiums in the exchanges and save the federal government $1.1 billion over 10 years in decreased premiums subsidies.

The Alexander-Murray bill would appropriate the CSR payments, which help offset the cost to insurers incurred by providing plans with low out-of-pocket cost to poorer Americans. Trump announced recently that he would cut off the payments, saying the administration could not legally continue to pay them, which could have significant ramifications for federal spending and the Obamacare exchanges.

But the CBO's rules forced it to assume in its baseline that the CSRs would be paid over the next two years.

"After consultation with the Budget Committees, CBO has not changed its baseline to reflect the Administration’s announcement on October 12, 2017, that it would stop making payments for CSRs," said the CBO report.

The CBO previously estimated that the federal government would pay $196 billion more over 10 years if the CSR payments were cut off. According to Loren Adler, associate director at the Brookings Institutions Center for Health Policy, since Alexander-Murray appropriates the CSR payments through 2019, including Trump's changes to the baseline would result in an additional $10 billion in savings.

The CBO's findings could bolster support for the bill. For Republicans, it shows that the federal government would save money. For Democrats, it provides a stable number of people insured. For both, it shows there would be some downward pressure on premiums.

As it stands, the bill is in limbo. There is enough support in the Senate to pass the legislation, but it is less clear in the House. It is also unclear whether leaders would bring the bill to the floor in either chamber. Finally, Trump's stance on the bill remains up in the air.

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• A new study by healthcare consulting firm Avalere Health found that premiums for silver-level Obamacare plans would increase by 34% next year.
• Avalere said the projected increases were due to changes from the Trump administration, enrollment adjustments, and insurer departures.
• The study also found that most Americans in the exchanges would be insulated from the increases.

A new study projected that average premiums in the Affordable Care Act's individual insurance exchanges will once again leap in 2018.

The study by healthcare consulting firm Avalere Health said that the average increase for the premiums of a silver-level plan would be 34% and the average second-highest cost silver plan, typically used as the benchmark, would increase 38% nationwide. That would be higher than the 25% increase for the benchmark plans in 2017.

According to Avalere, there are a few reasons for the projected increase:

• President Donald Trump's decision to halt so-called cost-sharing reduction (CSR) payments and Congress' inability to appropriate them.
• Lower enrollment than expected in the exchanges and insurer's subsequent exits from the exchanges.
• "Insufficient action by the government" to help offset losses by insurers, including the lapse of the reinsurance and risk corridor provisions.
• "General volatility around the policies governing the exchanges."

"Plans are raising premiums in 2018 to account for market uncertainty and the federal government’s failure to pay for cost-sharing reductions," said Caroline Pearson, senior vice president at Avalere. "These premium increases may allow insurers to remain in the market and enrollees in all regions to have access to coverage."

There would also be significant variation across states in the size of premium increases, or in some cases decreases, Avalere said.

"For example, Iowa will see the highest jump in average silver premium, 69%, over 2017, while Alaska will see a decrease in premiums for 2018, at -22%," said the study.

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• Peter Lee is the executive director of Covered California, the state's Obamacare insurance exchange and the second-largest exchange by enrollees in the country.
• Lee said the Trump administration has taken major steps to undermine the Affordable Care Act in 2017 and that will cause problems in 2018.
• He said the problems are "now on President Trump."

It's about to get ugly in the Obamacare insurance market, according to the man that runs Covered California, the second-largest individual insurance exchange in the country.

Peter Lee, Covered California's executive director, told Business Insider in an interview that the Trump administration has thrown a wrench into insurance exchanges under the Affordable Care Act that were on their way to stabilizing themselves in 2017. Lee even agreed with Trump's assessment that Obamacare is "gone"— but perhaps for a different reason than Trump intended.

"So I think there is a truth to it — Obamacare is gone," Lee said. "The reality is what is going to come home to roost for this president and this Congress is a collapsed individual market that was working well."

Lee said research from the Kaiser Family Foundation and Standard and Poor's pointed to increased insurer profitability and strong enrollment numbers. Now, that appears to be up in the air heading into the 2018 open-enrollment period.

"If you look at all of this research, 2017 was going to be the big turnaround year and now 2018 is going to be a s---storm," Lee said. "It is going to be a nightmare for much of country with some islands of calm, relatively speaking."

Already, a study by healthcare consulting firm Avalere Health projected that premiums for the lowest cost silver-level plans on the Obamacare exchanges would increase by 34% in 2018. Benchmark silver plans, which are the second most expensive, went up by only 26% in 2017.

Avalere said the increase was, in part, due to Trump's elimination of so-called cost-sharing reduction payments and "general volatility around the policies governing the exchanges."

Lee said that while consumers would be insulated from those increases for the most part, thanks to federal subsidies, it is an example of the ways White House interference has caused problems for the Obamacare exchanges.

Lee cited several examples of how the Department of Health and Human Services helped to undermine the market, including cutting off the critical cost-sharing reduction (CSR) payments, slashing funding for open enrollment that encourages people to sign up for plans on the Obamacare exchanges, and shortening the open-enrollment period to six weeks from 12.

California is making up for this lack of spending with a huge outreach campaign of their own, but Lee said the rest of the country will not be so lucky and it could lead to serious consequences down the road.

"But I think in a lot of other parts of the country, you’re looking at a federal government not spending money on marketing, you’re looking at uncertainty around CSRs," Lee told Business Insider. "Without that certainty, I think there’s the risk of having hundreds of bare counties in 2019 and mammoth rate increases."

Ultimately, Lee said all of these changes add up to one truth: Trump now owns any problems that crop up in 2018.

"This is now on President Trump, the healthcare market is not about President Obama anymore," Lee said. "They are the responsibility of this president, and they have to be owned by this president."

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• A new report from the Department of Health and Human Services showed that benchmark silver plans on the federal Obamacare exchange would increase an average of 37% between 2017 and 2018.
• However, the percentage of people able to find plans for less than $75 a month due to increased government subsidies will increase to 80%, up 9 percentage points.
• Additionally, in many parts of the country, more generous gold-level plans will end up being cheaper than the silver plans.

Premiums for the benchmark health plans offered on the federal Affordable Care Act insurance exchanges are set to skyrocket, according to the Department of Health and Human Services, though few people will likely end up seeing the increase.

HHS said in a report that premiums for a 27-year-old purchasing the second-lowest-cost silver plan — considered the benchmark for the exchanges — would increase by 37% next year, from an average of $300 a month to an average of $411 a month.

The raw premium increase is larger than the 24% increase for benchmark plans in 2017. It is the largest increase of any year for the Obamacare exchanges, and it is due in part to the Trump administration's actions.

After the administration's decision to stop paying the cost-sharing reduction (CSR) payments, the amount people will receive in premium subsides will on average increase substantially. The average monthly premium tax credit for an enrollee on the exchange, according to the report, will increase 45% in 2018 — to $555 a month from $382 last year.

In fact, while the headline premium for plans is ticking up dramatically, more people than ever will be able to purchase plans for $75 a month or less.

According to the HHS report, 80% of people on the federal exchange will be able to find a plan for $75 a month or less after subsides, and 86% of people will be able to find one with a monthly premium below $150.

However, only 60% of people will be able to find a plan for $75 a month within their current metal level — from the more generous gold-level plans to the more basic bronze level.

That may be part of another quirk from ending the CSR payments. In some parts of the country, some of the more generous gold plans will end up being cheaper than a silver plan in the same area.

An analysis from The New York Times found that the lowest-cost gold plan, which have lower deductibles than silver plans, would be cheaper (or close to it) after subsidies than the lowest-cost silver plan in roughly one-sixth of all counties using the federal marketplace.

Gold plans will be comparatively cheaper in all of Wyoming, New Mexico, and Hawaii; most of Kansas, Pennsylvania, Wisconsin, and Texas; and parts of Florida, Oklahoma, South Carolina, Georgia, Michigan, according to the analysis.

For 2018, it should be easier to find these plans on Healthcare.gov, since the plans will be arranged by the amount paid per month after subsidies are applied for the first time.

As with years past, the number of insurers in the federally facilitated exchanges declined, with a total of 132 issuers offering plans in 39 states, down from 167 last year. That includes pullback from major insurers like Anthem, which cited both difficult market conditions as well as uncertainty from the federal government for their declining footprint.

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• Peter Lee is the executive director of Covered California, the country's second-largest Obamacare exchange by enrollment.
• Lee said that while the disruption to the exchanges created by the Trump administration could be worrisome for the country, California has taken steps to insulate itself.
• Open enrollment for 2018 plans on the Obamacare exchanges kicks off November 1.

Peter Lee — and all the people tasked with running an Obamacare exchange — has had a long year.

Since November 2016, there have been multiple attempts to repeal and replace the law, along with big changes from President Donald Trump's administration. Despite all that, Lee is still gearing up for another Obamacare open-enrollment period as executive director of California's state-based exchange Covered California.

Covered California is the second-largest marketplace in the country, behind only Florida, with just over 1.5 million people enrolling for 2017, according to the Kaiser Family Foundation.

We spoke with Lee, whose family has a long history of involvement in health policy, by phone on Wednesday to talk about California's marketplace, how Trump affected his job over the past year, and what the next steps to improving America's healthcare system could be.

Bob Bryan: How is open enrollment different in California than the rest of the US?

Peter Lee: Sadly, it’s phenomenally different in California and many of the state-based marketplaces, compared to the rest of the nation that currently relies on the federal marketplace.

First, California, like most of the state-based marketplaces, has not shortened its open-enrollment period. So we will be open from November 1 through the end of January. That’s not because we aren’t sympathetic to the desire of health plans to end open enrollment so that people have a full year of coverage, but because we didn’t want to make a disruptive change with so many other uncertainties happening out there.

Two, marketing and outreach. We believe deeply that marketing does matter, and we have good data behind that. We’re going to spend in paid advertising, outreach, support for agents over $111 million in California. The federal government has reduced its paid-advertising spend from $100 million to $10 million, which means that the federal spending in 35 states is about what we’re spending on digital marketing alone in California.

Why do we know that’s important? We know that we have phenomenally high name recognition — about 96% of Californians know our name. That’s because we’ve been doing advertising and promotion for years. We also know that many people who are subsidy eligible who are uninsured today do not realize that they’re subsidy eligible. And we need them to get in because it improves the risk mix for everyone else.

So we can’t rest on our laurels because of the high turnover in the individual market and the lack of knowledge about subsidies. Without that people can’t get over the finish line because they don’t even start because they’re scared off by the high cost of healthcare.

The third thing I’d note about why we’re very optimistic is that we have a very competitive marketplace. Eleven health plans this year are the same 11 health plans as last year — virtually the same 11 health plans we had in 2014. We have 1.4 million people in Covered California, another 1.1 million people in the individual market outside of Covered California, and they mostly buy our products.

For people on the exchange, the way you get a good risk mix is the subsidies. 85% of our enrollees are subsidized, and those individuals are seeing no net change in price this year from last year. And that’s phenomenal. The average increase for people who have no subsidies is about 12%, but the fact that the people that are the bread and butter of making a market effective are getting no increase — even with the CSR surcharge — is great.

The last thing I’d note is we started figuring out a workaround in case the CSR payments weren’t funded months ago, and they weren’t. Fortunately, we were ready for that.

It’s unfortunate, it’s confusing, it will lead to probably somewhat lower enrollment just because people will be scared. I don’t think much in California, but in the rest of the nation people will be terrified. The sticker shock of the premium increase because there are no CSRs is going to scare people off because they don’t know it will be offset by subsidies.

Bryan: Given a lot of the news coming out of Washington in regard to the end of CSRs, attempts to repeal and replace Obamacare, President Trump’s executive order, how much are you focusing on telling people how these changes will affect them?

Lee: Actually very little. For our people who already have insurance, we’re doing a lot of communication. The day after the president announced the nonpayment of CSRs, we sent out over 1 million emails saying, "Don't worry: This won't affect you."

The average American doesn’t know what a cost-sharing reduction is. People who get CSRs, they were worried their tax credit was going away, they thought their financial help was going away. You know, the kitchen-table discussions are not the inside the beltway discussions. The kitchen-table discussions are what we’re focusing our advertising on: "You need health insurance, and it's more affordable than you ever imagined. Shop and find out."

We are not going to be out there focusing on Washington. We're going to be focusing on the kitchen-table discussion. In the end, Washington is a long way away, but health insurance is here and now.

Bryan: It may not show up to the people buying insurance, but have the DC changes affected your job over the past year?

Lee: No question.

We do a survey of people who are currently enrolled and prospective enrollees, and we ask people, "How confident are you that Covered California and/or the Affordable Care Act going to be around in the long term?" About a third of Californians say they’re confident and two-thirds say they’re either very unconfident or very unsure. The fact is those people are a lot less likely to sign up.

So the thing is, all that chatter will depress enrollment. It will depress enrollment more though when you don’t spend the money to tell people, "We're open — come on in." So there’s no question that there are headwinds for Californians getting health insurance.

But those headwinds in California are nothing compared to what you’ll see if you’re in Alabama, or Texas, or North Carolina. There’s no marketing there; it’s fiscally cuckoo.

The return on investment for marketing is five- to sevenfold, and it pays off in lower premiums for everybody. The biggest winners are not people who get subsidies, but it lowers the premiums for people who do not get subsidies. They’re the ones who are being hit hardest around the nation when you hear people talking about 40% rate increases.

People with subsidies? They’re shielded from those increases. What this is doing is a tax on the middle class that is totally unnecessary. That to me is the fiscal tragedy of not spending marketing dollars and of sowing the seeds of confusion. Those who are hurt are those who don’t get financial help.

Bryan: You mentioned that you have a competitive marketplace, but with all the upheaval, what are you hearing from the insurers in your marketplace?

Lee: The reason we set up this program to make sure that the CSRs will be paid was seven months ago a number of health plans said they were thinking about pulling out of the individual market. Now they’re making money in California, they’ve been making money in California. But none of them, not even the nonprofits, are charities. They’re not going to play this game if there’s mammoth uncertainty and if it’s a sure lose in terms of risk mix.

What we were able to do was six months ago say, "If we don’t get certainty from Washington, we will give you certainty."

I think they were nervous, and still are, on the enforcement of the penalty. I think the news from the IRS is some of the best news to come out of Washington in a while. But I think because we’ve created competitive marketplace — in other parts of the nation where plans have lost truckloads of money — in California plans have made a decent margin from year one.

From year one, California plans were payers into the risk-corridor program because they made more money than they were allowed. They’ve made money because we helped them price well; we helped them understand their risk profile.

So the reason health plans lost a lot of money around the nation, some of it has nothing to do with the recent uncertainty — it had to do with bad business decisions. But it also has to do with bad policy decisions locally. States that didn’t convert the entire individual market to one ACA-compliant risk pool, plans didn’t know how to price. They screwed up. They didn’t have that uncertainty in California.

I look at states like Iowa or North Carolina that have really struggled with their insurance markets. It was not self-inflicted by those consumers but it was self-inflicted by those state government that didn’t say, "We're going to set up a market that works for our citizens."

Bryan: Does that mean California is unique in the way it’s been able to handle Obamacare and set the market up this year?

Lee: It’s not just California. Look at the other state-based marketplaces like Colorado and Washington. These marketplaces have had to step up and provide certainty in the face of huge uncertainty from Washington.

You know, the things that have been most turbulent for us haven’t been what’s happening in Congress, it’s what’s happening with the administration. And again, we’ve been able to largely insulate Californians from that turbulence.

Bryan: You’re separating out the changes made by the Department of Health and Human Services and then what’s been going on in Congress, but would congressional fixes — like the proposed Alexander-Murray deal — still help?

Lee: Absolutely — absolutely.

Let me give you the two forks in the road here. Alexander-Murray would provide a more stability in the markets because many health plans are saying, "Do I play in 2019 or not?" I think in California, they’re doing fine: they’re not walking away in 2019.

But I think in a lot of other parts of the country, you’re looking at a federal government not spending money on marketing; you’re looking at uncertainty around CSRs. I think there’s the risk of having hundreds of bare counties in 2019 and mammoth rate increases.

That’s because what’s going to happen with the risk mix in this open-enrollment period, it’s going to go south — it’s going to go bad. If you don’t spend money on marketing, sick people will still find their way to the door every time, every day of the week. Healthy people need to be sold.

On the flip side, Alexander-Murray provides really important stability to much of the market.

In terms of instability, the executive order is a huge unknown for us right now. We don’t know what the regulations will look like to put in short-term duration plans or association health plans, but if you’re a health plan, that's uncertainty, that’s turbulence, that’s turmoil.

Bryan: What effect does Trump saying things like "Obamacare is dead" or "it doesn't exist anymore" have on consumers you talk to, and how does that complicate your job as someone involved with the ACA every day?

Lee: He’s right; this is now on President Trump. The healthcare market is not about President Obama anymore. They are the responsibility of this president, and they have to be owned by this president.

Number two, consumers in California, and thus the nation, know that their experience has not been one of a collapsed market. They’ve experience access to insurance that they never could before. They’ve experienced low premiums increases. They’ve experienced competitive plans. So the felt experience of millions of Americans is a healthcare system that they like and now works.

Even when President Obama was president, we were never selling Obamacare. One of the things we’ve done successfully is put the politics behind us and say, "Let’s just make this product work."

So I think there is a truth to it — Obamacare is gone. The reality is, what is going to come home to roost for this president and this Congress is a collapsed individual market that was working well.

If you look at all of this research, 2017 was going to be the big turnaround year and now 2018 is going to be a sh--storm. It is going to be a nightmare for much of country with some islands of calm, relatively speaking.

Bryan: Is California one of those islands on calm?

Lee: I think it is an island of relative clam, for sure, but we still get backsplash from Washington. People out here are still nervous — people are worried.

But it’s a combination of things. For instance, Gov. Brown expanding the Medicaid program — that helped stabilize the individual market. It was the fact that we have 19 local meetings with insurance meetings and local insurance agents across the state, we have Agents Republican and Democrats trying to sell insurance across the state.

Those are some of the elements that help us be successful.

Bryan: On the other side of things, to what extent do you think the talk around single-payer healthcare by Democrats contributes to the uncertainty around the healthcare system?

Lee: I totally understand that it’s coming up; it’s sort of a tit-for-tat thing.

The main thing for me is that California is a very big state and we’re already approaching universal coverage today. We’ve taken our uninsured rate down, from 17% to 7%, and half of that is undocumented immigrants. So we have an eligible insured rate of about 3%.

That’s rivaling single-payer countries like Germany and France. So I’d say if you’re seeking headlines on either side, let’s look at what’s in front of us. What we’ve got is kind of a Rube Goldberg system with employer coverage and public here and private there. But we’ve got a system that’s actually working well for many millions of Americans, and I’m a practical guy, so that’s why I’m focusing my attention on.

Bryan: What keeps you up at night when it comes to health policy? And conversely, what helps you sleep at night?

Lee: The two things that keep me going are, one, when you get politicians and their staff away from a microphone, both sides of the aisle want to work together. And that’s why I find Alexander-Murray so hopeful. Pendulum politics, swinging from having 51 Republicans [in the US Senate] to 51 Democrats, those policies won’t stick. So having productive bipartisan discussions is hopeful.

The other thing is I see is the positive impact we have on individuals. I hear from people who couldn't get insurance before and now can. And that’s really incredibly heartening.

The thing that keeps me up at night are stupid policies. This is not rocket science. Healthcare is complicated, but the business and the math of good risk is pretty simple math.

Healthcare in America is too expensive. The average premium of a family with employer-based coverage is $18,000 a year. That means everyone needs financial help, unless you’re Bill Gates. Most of us get it through our jobs, but let’s work the math. If you don’t get help through your job? Let’s try the federal government; let’s try to work in these other ways.

It’s so easy to have headline-based stories about what’s working and what’s not working, but the reality is providing financial help is a must-have to make healthcare work in America. But let’s also make sure we address the underlying cost. And that’s what keeps me up at night. All of these issues are a distraction from the fact that we’re spending boatloads more on healthcare than we should be.

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• President Donald Trump tweeted that the GOP tax bill should include a repeal of Obamacare's penalty for not having insurance.
• This would likely lead to a destabilization of the individual insurance market, but also save the government money.

President Donald Trump offered a policy suggestion to congressional Republicans via Twitter on Wednesday, suggesting the forthcoming GOP tax bill should include a repeal of the Affordable Care Act's individual mandate.

"Wouldn't it be great to Repeal the very unfair and unpopular Individual Mandate in ObamaCare and use those savings for further Tax Cuts for the Middle Class."Trump said. "The House and Senate should consider ASAP as the process of final approval moves along. Push Biggest Tax Cuts EVER."

The individual mandate, which stipulates that people must have insurance or face a penalty from the IRS, is one of the most unpopular parts of the ACA, also known as Obamacare, but also one of its most critical.

Most experts agree that the mandate helps to encourage younger, healthy people to sign up for coverage which improves the risk mix in the Obamacare exchanges. This keeps costs down for sick people and helps improve market conditions for insurers.

Without the penalty, according to experts, the market conditions in the exchanges would likely deteriorate, costs would increase for sicker people, and insurers would flee from the market.

On Monday, GOP Sen. Tom Cotton floated the idea as a way to generate revenue for the tax plan.

According to a report from the Congressional Budget Office, a repeal of the mandate would decrease the federal deficit by $416 billion over 10 years. This would be mostly due to the decrease in what the federal government pays in subsides for people's insurance premiums who get coverage on the Obamacare exchanges.

According to the CBO, 15 million more people would be without insurance under the plan compared to the current baseline. This means the government would not assist in paying their insurance premiums, offsetting the lost revenue from the mandate repeal and eventually saving the government money.

The tweets also come as the open enrollment period beings for Obamacare, during which people without coverage through an employer or a government program like Medicaid or Medicare can access health insurance.

Whether the tax bill will include a repeal of the mandate remains to be seen. The roll out of the bill was pushed back by House GOP tax writers from Wednesday to Thursday due to disagreement on some key elements of the plan.

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• Open enrollment for health insurance via the federal Healthcare.gov and state-based marketplaces opens on Wednesday.
• The open enrollment is the first under President Donald Trump, who has made big changes to the Affordable Care Act since taking office.
• Most analysts believe these changes will suppress enrollment, but for some the differences could lead to cheaper premiums.

Wednesday marks the start of the fifth open-enrollment for the Affordable Care Act, or Obamacare. It's the law's first under President Donald Trump, and it comes in perhaps the most bizarre year yet for the health insurance exchanges.

Despite efforts to repeal and replace the law, the ACA remains intact and the Internal Revenue Service will still enforce the individual mandate that requires people to have insurance or pay a fine. 

Over the next six weeks, millions of people will reenroll — or enroll for the first time — via Healthcare.gov and state exchanges for their Obamacare plans. How many enrollees sign up could be fodder for either side of the aisle. If it's lower, Trump will likely point to it as an example of how the law is failing — and Democrats will point to it as an example of how the president has sought to undermine the law.

Upheaval

Obamacare insurance markets have undergone a transformation over the past year due to significant changes from the Department of Health and Human Services under the Trump administration.

Peter Lee, the executive director of California's state-run Obamacare marketplace Covered California, told Business Insider that Trump's changes are substantial enough that he should now own its future.

"This is now on President Trump," Lee told Business Insider. "The healthcare market is not about President Obama anymore. They are the responsibility of this president, and they have to be owned by this president."

The two most obvious changes for open enrollment: a shortened length of time to enroll and a massive decrease in advertising to encourage people to sign up.

A Trump administration rule shortened the length of the open-enrollment period from three months to just six weeks, from November 1 through December 15. Some state run exchanges in California, Colorado, and Minnesota will run longer.

The reduced length will allow all plans sold on the federal exchanges to kick in at the start of 2018, but will also likely lower the number of people who enroll.

Another major change is how much money the administration is set to spend on advertising to drive enrollment. The budget for advertising via online ads, TV ads, etc., was cut to just $10 million from roughly $100 million.

This is particularly worrying, Lee said, because there has been a strong correlation between ad spending and enrollment.

"The return on investment for marketing is five- to sevenfold, and it pays off in lower premiums for everybody," Lee said. "The biggest winners are not people who get subsidies, but it lowers the premiums for people who do not get subsidies."

Additionally, many navigator programs — which hire people to help prospective enrollees choose plans — have seen their budgets slashed by HHS. The cuts forced staff layoffs and decreased consumer reach.

Even little changes, like the timing of maintenance for the Healthcare.gov website, appear to be designed to complicate the open enrollment period. The sum oif these changes could be enough to do serious damage to the ACA, according to Larry Levitt, a senior vice president at The Kaiser Family Foundation, a nonpartisan health policy think tank.

"No one of the Trump administration’s actions is crippling to the ACA’s marketplace, but the cumulative effect could be quite damaging," Levitt told Business Insider a few weeks before the start of open enrollment.

The changes will also likely lead to lower enrollment in the exchanges this year. A Standard and Poor's study estimated that 10.6 million to 11.4 million Americans would likely enroll in plans on the exchanges this year, down from 12.2 million selections during last year's enrollment period, a 7% to 13% drop.

"Our forecast took into account multiple factors, including the expectation of reduced active outreach at the federal level, a reduced broker presence in the individual market, shorter enrollment periods, and higher non-subsidized premiums," the analysis said.

Cheaper for many, but not for all

While enrollment will likely be depressed, most people that do find plans could find that they're cheaper than ever.

It won't seem so based on raw premiums. According to a report from HHS released prior to open enrollment, the average premiums for a benchmark silver plan will be up 37% in 2018 — the biggest year-over-year increase ever.

But premium subsides from the federal government will help to offset premiums for more people than ever. According to the HHS report, 80% of people qualified for the federal insurance exchanges will be able to find a plan that will cost $75 a month of less after subsidies are applied.

There remains, however, serious strain on those people who do not receive subsides and will bear the brunt of the increased premiums. For these people, the open-enrollment period will likely be a trade off between a cheaper, less generous plan and a much more expensive plan to maintain the same level of coverage.

For many of those without subsidies, experts say plans may be cheaper off the exchanges through an insurance broker.

Quirks in the system

In an odd quirk starting next year, many of Obamacare's top-of-the line plans are set to be less expensive for people than the middle silver level plans.

Obamacare plans come in four levels— bronze, silver, gold, platinum — with each successive level covering more types of care and offering lower out-of-pocket costs with a higher premium.

A New York Times analysis found that changes in premium subsidies and Trump's decision to end cost-sharing reduction payments would result in the lowest-cost gold plan costing less than or close to then the lowest-cost silver plan on one-sixth of the counties where people use Healthcare.gov to sign up for insurance.

In fact, three states — Hawaii, Wyoming, and New Mexico — will have cheaper gold plans in every single county.

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• Obamacare will become what could be seen as an expanded version of Medicaid.
• The average subsidy for Obamacare consumers will grow by 45%, making net premium cost even lower for many people.
• Insurance companies may not benefit, despite President Donald Trump’s statement that subsidies are a “bailout” payment allowing them to “make a killing” on their Obamacare policies.

In a great irony, the Republicans, who promised to eliminate the Affordable Care Act and roll back Medicaid expansions, are in essence about to do the reverse – at a huge cost to the U.S. Treasury. This year Obamacare will become what could be seen as an expanded version of Medicaid.

From my perspective as a finance professor and former insurer CEO, I predicted trouble when President Trump said last summer that he would let Obamacare fail. He didn’t say at the time that he’d help make sure that happens by driving up premiums – or that millions will rejoin the ranks of the uninsured while the federal government spends billions more in the process.

Yet that almost certainly is in the cards now.

How could this be?

An ineffectual Congress unable to pass even minimal corrective legislation and bullying actions from the White House have produced an enormous increase in nominal premiums of at least 34 percent for 2018 plans offered on the individual exchanges. The increases came about as plans scrambled to cover the higher risk of expensive care. Meanwhile, large group premiums continue to grow at a little over 6 percent.

But not all marketplace consumers will pay for those increases – taxpayers will. The average subsidy for Obamacare consumers will grow by 45 percent, making the net premium costs even lower for many!

This anomalous result comes from the way that Obamacare subsidies are calculated. Subsidies are determined by taking the difference between stated premiums and a fixed percent of an enrollee’s income (2 percent for those just above the poverty level; up to 9.5 percent for at the top).

Premium prices rose this year not only because insurers left the marketplace. Insurers also had to incorporate losses caused by Pres. Trump’s suspension of cost-sharing subsidies into their premiums and uncertainty about who would enroll.

The president would want us to see the rising premiums as signs of the Obamacare “implosion” he predicted. But in reality, they are steps leading to a redefinition of the exchanges. Originally, sliding-scale subsidies based on income were to make access affordable for everyone. But sky-high premiums mean that only those qualifying for these subsidies are likely to purchase insurance on the exchanges, while others are priced out.

So Obamacare becomes an extended Medicaid expansion

This latest scenario looks a lot like the Republican plans for Medicaid under the waivers, as enacted by Indiana and planned widely in red states.

These Medicaid waiver programs for the poor require enrollees to pay some portion of premiums and cost of care to independent private insurers, just like the exchange plans do. But the level of eligibility for subsidized exchange plans goes far beyond Medicaid range for states that took the option to expand. These states cover enrollees up to 138 percent of the poverty level ($16,623 for an individual) while the exchange plans subsidize coverage up to 400 percent of the poverty level ($48,240).

The typical conventional working-age Medicaid enrollee qualifies for care for less than nine months until he or she gets a job and loses coverage (kids and the elderly stay on far longer). These enrollees typically regain Medicaid coverage after a “spend down” period when they have a medical event that they can’t afford which eats up their cash or dumps them out of the job market.

Effectively, many of the same people rotate between conventional Medicaid and the Obamacare insurance exchange. Thanks to the subsidies under the ACA, these folks will not suffer the 34 percent increase in premiums and will stay with exchange plans. Since subsidies are rising, many of them may pay far less, or even zero premiums.

As over three-quarters of those on the exchange receive substantial subsidies, the enrollment on the exchanges will not drop precipitously although government outlays will jump.

Who loses?

However, the other quarter are out of luck. They will have to pay far more. Thanks to lax enforcement of the individual mandate to acquire health insurance or face tax penalties and President Trump’s executive order allowing lower-priced, stripped down, non-exchange options, these folks are almost certain to exit the exchanges.

So the bottom line is that most folks left in Obamacare will be those still receiving significant subsidies. These are the people who look a lot like conventional Medicaid enrollees – because they were enrolled before or are on the edge of eligibility now. Effectively, we have expanded the Medicaid program to them through the back door.

Unfortunately, this is a very expensive way to expand Medicaid.

There are two big losers. One is those individuals who relied on exchange plans but don’t receive subsidies. The other is the federal deficit. The former often are the near-elderly or those with preexisting conditions who couldn’t get coverage before at a reasonable rate. They are stuck with high premiums necessary to cover the extra risk induced by the chaos of repeal and replace efforts. The second are the taxpayers, who have to absorb the higher subsidies, amounting to over $7 billion.

The winners are certainly not the insurance companies, in spite of Mr. Trump’s statement that the subsidies are a “bailout” payment allowing them to “make a killing” on their ACA policies.

In fact, almost all report significant losses on their exchange products, and many have left or failed financially. And even if they were to make windfall profits, the extra must be rebated to their customers under a little-reported provision of the ACA limiting the amount they can retain beyond direct medical costs.

Does anyone win?

The only winners here may be those low-income people who now have higher subsidies and a lower net cost of insurance. Virtually no one else comes out ahead – not insurers, not other individuals, not the government.

If they knew this, even rock-ribbed conservatives might well join their liberal friends in opposing this incremental approach to health policy, even though the alternatives they favor would differ greatly.

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• Rep. Kevin Brady said Friday that the repeal of the Affordable Care Act's individual mandate could still be added to the new GOP tax bill.
• Repealing the mandate would save the federal government billions over the next 10 years, because far fewer people would have health insurance.
• Brady did not fully commit, because such a provision could run into trouble in the Senate.

A key part of the Affordable Care Act could still be on the chopping block as part of the GOP tax plan, a top Republican said Friday.

While speaking at a Politico event, House Ways and Means Committee Chair Kevin Brady — the author of the GOP tax bill — said that he is still considering including the repeal of the Affordable Care Act's individual mandate in the final tax bill.

"No decisions have been made," Brady said. "We're listening to members and certainly the president as well."

President Donald Trump tweeted that the bill should include an individual mandate repeal on Wednesday, less than 24 hours before the legislation's release.

By repealing the ACA's mandate, which compels Americans to buy insurance or face a tax penalty from the IRS, the federal government would save $416 billion over the next 10 years, according to a report from the Congressional Budget Office.

The cost of that increase revenue, however, would be approximately 15 million more people uninsured over the next 10 years compared to the current baseline. Without the individual mandate, some healthy people would choose to go without insurance, causing insurers to raise prices. That could lead to more people leaving the Obamacare exchanges, leading to insurers dropping out of the exchanges or raising prices, and so on. This is what health policy experts call a "death spiral."

A repeal of the mandate would also mean the federal government would not need to pay financial assistance for many people on the exchanges to help cover their premiums, saving money in tax outlays.

While the option was not in the draft of the tax bill released Thursday, Brady suggested it could be added in later revisions. Brady did express some reservations, however, given that the Senate could not agree on a repeal of Obamacare over the summer.

"There are pros and cons to this, importing healthcare into a tax reform debate has consequences especially when the Senate has failed to do anything on healthcare," Brady said.

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• Voters in Maine approved a measure allowing them to expand Medicaid under the Affordable Care Act.
• It was the first time since the law took effect that the question of expansion had been up to U.S. voters.
• The issue affected many people in Maine, a rural state that has the nation's oldest population and the region's lowest wages.

PORTLAND, Maine (AP) — Maine voters on Tuesday approved a measure allowing them to join 31 other states in expanding Medicaid under the Affordable Care Act, the signature health bill of former President Barack Obama.

The referendum represented the first time since the law took effect that the question of expansion had been put in front of U.S. voters.

Some 11 million people in the country have gotten coverage through the expansion of Medicaid, a health insurance program for low income people.

The vote in Maine was a rebuke of Republican Gov. Paul LePage, who vetoed five different attempts by the state Legislature to expand the program. It follows repeated failures by President Donald Trump and his fellow Republicans in Congress to repeal Obama's law.

For supporters and opponents of "Obamacare," Maine's question took on the form of a referendum on one of the most important pieces of the Affordable Care Act. And it was taking place in a politically charged atmosphere with GOP efforts to undermine, or repeal, the health overhaul.

Here in the nation's Northeast corner, the issue was personal to many in a rural state that has the nation's oldest population and the region's lowest wages.

Passage of the proposal would mean an estimated 70,000 people in Maine would gain health coverage. About 268,000 people currently receive Medicaid in the state.

Maine's governor blamed an earlier Medicaid expansion for increasing state hospital debt, and he opposes giving able-bodied people more access to Medicaid.

LePage often summarizes his argument by saying: "Free is expensive to somebody." He also warned that he would have to divert $54 million from other programs — for the elderly, disabled and children — to pay for the state's share of the expansion once it's fully implemented.

Mainers For Health Care, which supports expansion, touted the proposal as a "commonsense move" to ensure health care coverage for more people. Maine's hospitals also supported the Medicaid expansion and say charity care costs them over $100 million annually.

The initiative's supporters have reported spending about $2 million on their campaign, with hundreds of thousands of dollars coming from out-of-state groups. By comparison, the lead political action committee established to oppose the measure has spent a bit less than $300,000.

This may not be the last state vote.

Backers of Medicaid expansion in Idaho and Utah have started similar efforts to get the question on the 2018 ballots in their own states. If it passes in Maine, some 70,000 people would gain health coverage.

Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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• Maine voters on Tuesday approved a measure to expand Medicaid in the state.
• Gov. Paul LePage, a Republican who has repeatedly blocked attempts to expand the program, on Wednesday said he would not allow the measure to become law until the legislature determined that it would be paid for in full.
• The expansion would allow as many as 80,000 low-income Mainers access to health insurance.

The day after voters in Maine overwhelmingly supported an expansion of the state's Medicaid program, the state's governor said he would block its implementation.

Gov. Paul LePage said in a statement Wednesday that he would not allow implementation until the state legislature made certain changes to its budget.

"Credit agencies are predicting that this fiscally irresponsible Medicaid expansion will be ruinous to Maine's budget," LePage said. "Therefore, my administration will not implement Medicaid expansion until it has been fully funded by the Legislature at the levels DHHS has calculated, and I will not support increasing taxes on Maine families, raiding the rainy day fund or reducing services to our elderly or disabled."

LePage has the ability to send the measure back to the Maine legislature to come up with a funding mechanism, allowinf him to slow the expansion at the least.

Fifty-nine percent of Maine voters agreed with a ballot measure proposing to expand Medicaid, a margin of over 60,000 people.

The change would allow people making up to 138% of the federal poverty level to obtain health coverage under the program — Medicaid in Maine today is available to people making up to the poverty line. According to estimates, this would allow 70,000 to 80,000 more lower-income Mainers to obtain insurance coverage.

LePage has a history of blocking Medicaid expansion in the state, vetoing bills to expand the program four times.

During the run-up to the vote, LePage argued that the expansion would be a significant financial burden on the state, saying it could cost upward of $100 million a year. Maine's Office of Fiscal and Program Review, however, found that the federal government would shoulder $525 million a year for the program and that the state would pay just over $55 million a year.

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• The Congressional Budget Office said that repealing the Obamacare individual mandate would increase the number of uninsured by 13 million by 2027.
• The budget office also said that it would reduce the federal budget deficit less than predicted.
• Health insurance premiums was predicted to rise by about 10 percent in most years, over the next decade in the individual market.

WASHINGTON (Reuters) - The Congressional Budget Office said on Wednesday that repealing the Obamacare individual mandate would increase the number of uninsured by 13 million by 2027 and reduce the federal budget deficit less than initially forecast.

The CBO, the nonpartisan budget-scoring agency, said that eliminating the Obamacare mandate that all Americans purchase health insurance or else pay a fine would lower the deficit by $338 billion over the next decade, not $416 billion as it estimated in December.

The agency found that health insurance premiums would rise by about 10 percent in most years over the next decade in the individual market created by the Affordable Care Act, former Democratic President Barack Obama's signature domestic policy achievement. It noted that markets in most areas of the country would remain stable.

President Donald Trump and some Republicans favor including a repeal of the mandate in tax overhaul legislation. But lawmakers, Republican aides and lobbyists have said it would be difficult to include a repeal in a tax effort complicated by intraparty differences and intense business lobbying.

The U.S. House of Representatives unveiled its tax plan last week, and the Senate's plan is expected to be released on Thursday.

The individual mandate is a central tenet of Obamacare that health policy experts and proponents say is essential to making the law work. It compels young and healthy people to join health insurance markets and help lower premiums by offsetting the costs of sicker patients.

Americans must note on their tax returns whether they have health coverage.

Yet it has proved to be among the most controversial portions of the law as Republicans, who say Obamacare is too expensive and an example of government overreach, argue that the federal government should not be able to require people to buy health insurance if they do not want it.

The CBO said in its December report that the individual mandate increases the federal deficit by encouraging people to buy subsidized coverage, either through Medicaid, the government health insurance program for the poor and disabled, employer-provided plans, or through the Obamacare individual health insurance market.

Eliminating the mandate would lower the deficit by reducing federal spending on subsidized health insurance coverage, it said.

The CBO said abolishing the requirement would cause premiums to rise because healthier people would be less likely to purchase insurance. It found that the resulting increases would cause more people to forego insurance. 

(Reporting by Makini Brice and Yasmeen Abutaleb; Editing by Susan Heavey, Jeffrey Benkoe and Susan Thomas)

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