Democrats say upcoming spending bill must fund Obamacare payments

Waves of color surround the Capitol Dome in Washington, early Friday, Feb. 10, 2017. 

J. Scott Applewhite, AP

WASHINGTON -- Democrats are up in arms over President Donald Trump’s threats to deny payments to health insurers under Barack Obama’s health care law.

Party leaders want the issue addressed in the current talks on the spending bill to keep the government open. The bill is due at the end of the month.

At issue are cost-sharing payments that low-income people enrolled under the health care law receive to help cover out-of-pocket expenses. Trump has threatened to withhold the payments as a means to force Democrats to negotiate on health care legislation.

Democratic aides said Thursday that the payments are at the top of the list of the negotiating demands of House Minority Leader Nancy Pelosi and Senate Democratic Leader Chuck Schumer. They may be hoping that a hard line would force Trump to back down. Otherwise, the fight could increase the chances of a government shutdown at the end of the month if talks on the spending bill break down.

Democratic votes are likely to be needed to pass the spending bill, giving Pelosi and Schumer leverage in the talks. Republican conservatives and the Trump administration do not want the health care payments to be addressed in the spending bill.

The demands by Pelosi, D-Calif., and Schumer, D-N.Y., are sure to roil the talks, which are already strained by controversial Trump demands for funding to build a wall along the U.S.-Mexico border and $30 billion in Pentagon spending. More than $1 trillion in agency funding is at stake as an April 28 deadline looms. White House budget director Mick Mulvaney has also raised the idea of using the spending bill to punish so-called sanctuary cities - municipalities that do not cooperate with federal immigration enforcement - by denying their federal funding.

The future of the cost-sharing subsidies, estimated at $7 billion this year, is under a legal cloud. Trump threatened in an interview with the Wall St. Journal on Wednesday to drop the payments, which experts warn would severely disrupt Obamacare’s marketplaces.

Without them, experts say the government marketplaces that provide subsidized private insurance for about 12 million people will be overwhelmed by premium increases and insurer departures.

“I don’t want people to get hurt,” Trump told the Journal. “What I think should happen, and will happen, is the Democrats will start calling me and negotiating.”

Pelosi and Schumer were infuriated by the threat, aides said, and are pushing back.

A Pelosi aide said the president’s comments on stopping the cost-sharing reduction payments will increase costs and are “a threat to the good health of the American people and a threat to keeping government open.”

Added Schumer: “’’Our position remains unchanged: drop repeal, stop undermining our health care system, and we will certainly sit down and talk about ways to improve the Affordable Care Act.”

The cost-sharing subsidies were defended by Rep. Greg Walden, R-Ore., who said they should be paid because the government made a commitment to insurers.

“And if we don’t keep that commitment they have the right to walk away from the plans, and it’s enough money that some of them might do that. And they’d be justified in doing that,” Walden said. “And that would dramatically disrupt the insurance markets, and we should not let that happen.”

Even as Trump threatened the subsidies, his administration on Thursday took a set of limited steps to strengthen the marketplaces in other ways.