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OMB: Funding insurer subsidies will lower ACA premiums 15-20%

OMB Director Mick Mulvaney
OMB Director Mick Mulvaney. (Photo: Win McNamee / Getty Images)

Funding the Affordable Care Act's cost-sharing subsidies would lower premiums by 15-20%, according to an analysis being circulated around congressional offices from the Office of Management and Budget. OMB says those subsidies would be more cost-effective than a new reinsurance program.

Why it matters: Reinsurance has been gaining steam on Capitol Hill, and Sen. Susan Collins is still owed a vote on a reinsurance bill. But the White House budget office is saying Congress could get a better deal by restoring a funding stream that President Trump cut off last year.

The numbers:

  • President Trump's decision to quit making the cost-sharing payments this year caused premiums to rise by 15-20%, the analysis says, and funding them next year would undo that increase.
  • It also says that for every $1 billion spent on a reinsurance program — which would compensate insurers for their most expensive claims — individual market premiums would decrease by only 1%.

Key quote: "We project funding CSRs would have a greater impact on reducing premiums than any of the reinsurance funding levels that have been proposed, and would have more bang for the buck in terms of Federal spending."

Jonathan Swan 5 hours ago
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Bolton bombshell: the clashes to come

John Bolton
John Bolton speaks at CPAC in 2016. Photo: Andrew Harrer / Bloomberg via Getty Images

Sources close to President Trump say he feels John Bolton, hurriedly named last night to replace H.R. McMaster as national security adviser, will finally deliver the foreign policy the president wants — particularly on Iran and North Korea.

Why it matters: We can’t overstate how dramatic a change it is for Trump to replace H.R. McMaster with Bolton, who was U.S. ambassador to the U.N. under President George W. Bush.

Erica Pandey 7 hours ago
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How China became a global power of espionage

Illustration: Sarah Grillo / Axios

As China’s influence spreads to every corner of the globe under President Xi Jinping, so do its spies.

Why it matters: China has the money and the ambition to build a vast foreign intelligence network, including inside the United States. Meanwhile, American intelligence-gathering on China is falling short, Chris Johnson, a former senior China analyst for the CIA who's now at the Center for Strategic and International Studies, tells Axios: "We have to at least live up to [China's] expectations. And we aren't doing that."