Get the latest market trends in your inbox

Stay on top of the latest market trends and economic insights with the Axios Markets newsletter. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Denver news in your inbox

Catch up on the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Des Moines news in your inbox

Catch up on the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Minneapolis-St. Paul news in your inbox

Catch up on the most important stories affecting your hometown with Axios Minneapolis-St. Paul

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tampa-St. Petersburg news in your inbox

Catch up on the most important stories affecting your hometown with Axios Tampa-St. Petersburg

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Ending subsidy payments could help make part of the ACA better. Photo: Andrew Harnik/AP

President Trump's decision to quit paying a critical Affordable Care Act subsidy has given most of the country access to insurance with no monthly premiums — nudging it, however inelegantly, in the same direction Democrats have wanted to go (at least for the poorest enrollees).

The bottom line, from Democratic health care strategist Chris Jennings: "The R's are driving in reverse relative to their repeal dream."

How it works: When Trump decided to quit making payments to insurers for the ACA's cost-starring reduction (CSR) subsidies, insurers responded by raising their premiums for certain plans — mostly, the "benchmark" plans that are used to determine the size of the ACA's premium subsidies.

  • That, in turn, made those subsidies much more generous.
  • And now, in most counties in the U.S., the lowest-income enrollees will be able to find at least one plan for which their subsidy covers the entire premium.
  • "In a way, this was an incredibly complicated and convoluted way of increasing the premium subsidies available to consumers," said Larry Levitt of the Kaiser Family Foundation.
  • But people who don't receive subsidies could have to pay substantially more. And this backwards stumble into higher subsidy is still a net negative for insurers, who crave stability most of all.

What they're saying:

  • "The ACA was designed to protect low income consumers from situations like this-- as improbable as this one was," said Andy Slavitt, the former Centers for Medicare and Medicaid Services under President Obama. But "for people without subsidies, Trump's action disproportionately hurt those in the middle class."
  • Topher Spiro, of the Center for American Progress: "People can get better deals, but not unless they shop around—and there's mass confusion as a result of sabotage. So far, no insurers have pulled out, but continued uncertainty means there's a risk of insurers exiting for 2019—or not re-entering markets."

Reality check: The irony of all this is that Democrats — including Hillary Clinton — have consistently pushed for increased premium subsidies, albeit in a much more straightforward way. (And of course they also want the government to continue the payments Trump cut off.)

  • "We could spend that extra money we are shelling out today to pay for the excess premiums far more efficiently and get more people covered more affordably," Jennings said.
  • Congressional Republicans would never have agreed to create more "free" insurance plans on the government's dime. Their repeal-and-replace bills would have substantially reduced the law's premium subsidies. But many experts think higher subsides will help. "That's what it's going to take to make the ACA work," said Chris Condeluci, a former Republican aide on the Finance Committee.

Go deeper

Dion Rabouin, author of Markets
Updated 1 hour ago - Economy & Business

Our make-believe economy is here to stay

Illustration: Eniola Odetunde/Axios

The Federal Reserve and global central banks are remaking the world's economy in an effort to save it, but have created something of a monster.

Why it matters: The Fed-driven economy relies on the creation of trillions of dollars — literally out of thin air — that are used to purchase bonds and push money into a pandemic-ravaged economy that has long been dependent on free cash and is only growing more addicted.

Mike Allen, author of AM
3 hours ago - Politics & Policy

Why Trump may still fire Barr

Photo: Jabin Botsford/The Washington Post via Getty Images

Attorney General Barr may be fired or resign, as President Trump seethes about Barr's statement this week that no widespread voter fraud has been found.

Behind the scenes: A source familiar with the president's thinking tells Axios that Trump remains frustrated with what he sees as the lack of a vigorous investigation into his election conspiracy theories.

Mike Allen, author of AM
3 hours ago - World

Scoop: Trump's spy chief plans dire China warning

Xi Jinping reviews troops during a military parade in Beijing last year. Photo: Thomas Peter/Reuters

Director of National Intelligence John Ratcliffe on Thursday will publicly warn that China's threat to the U.S. is a defining issue of our time, a senior administration official tells Axios.

Why it matters: It's exceedingly rare for the head of the U.S. intelligence community to make public accusations about a rival power.