'Trump Tax': Health Insurance Rates To Increase, Insurance Commissioner Warns

OLYMPIA, WA - Washington Insurance Commissioner Mike Kreidler issued a statement this week calling Donald Trump's order to cut off federal funding for Obamacare a "Trump tax." Last Thursday, Trump announced the federal government in 2018 would stop making federal cost-sharing reductions (CSRs) to insurers that provide Obamacare health care plans to poor people.

"President Trump’s devastating refusal to pay federal funding that helps people afford health insurance leaves me no choice but to reluctantly allow health insurers to charge higher premiums for 2018. Not allowing the higher rates would cause further instability in our market," Kreidler said in a statement. "The higher rates – ranging from 9 percent 27 percent more than they proposed in June – depending on the insurer, are essentially a tax that President Trump is imposing on consumers."

Kreidler also sent a letter to state residents warning that the 2018 silver plans on Washington Healthplanfinder would carry the "Trump tax" rates. The state Office of the Insurance Commissioner in September actually approved two types of rates: ones that includes CSRs, and ones that don't.

Trump's cutting off of federal payments is viewed as a way for him to gain leverage with congressional Democrats. But if Congress can't agree on an Obamacare repeal, people will be forced to pay much higher health insurance rates in 2018. Here's what the state approved for 2018 silver plan rates if the CSRs remain unfunded:

Even if Trump decides to reverse his CSR position, insurance rates in Washington are going up. For example, the Molina Healthcare of WA silver plan rate will increase from $253 to $345 even with CSRs funded.

“Make no mistake: the president had a choice and he chose to make health care cost significantly more for people who need help. The fallout from this lands squarely on his shoulders. He ignored thoughtful and realistic recommendations from insurance regulators, insurers, doctors, business organizations and consumer advocates from across the country," Kreidler said.

Image via Pablo Martinez Monsivais/Associated Press