Even as they repeal Obamacare, Republicans still have to fund it

Burwell: Obamacare repeal would be 'chaos'
Burwell: Obamacare repeal would be 'chaos'

Even as Republicans move to kill Obamacare, they will have to spend billions of dollars funding it.

Perhaps even more ironically, lawmakers will likely have to support the very subsidies they have tried to overturn in court if they want to fulfill their promise of "an orderly and smooth transition" into the Republican plan for health care.

Though Congress last week took the first steps to repeal major portions of Obamacare, the law is not disappearing immediately. It will take weeks, or even months, for lawmakers to come up with a replacement bill. Even after they pass that legislation, it could take at least a year for the provisions to take effect.

Meanwhile, Republican leaders in Congress and Vice President-elect Mike Pence have promised a "stable transition period" so those who've gained coverage under Obamacare aren't left uninsured.

Related: How Trump could use his executive power on Obamacare

That means Republicans will have to continue funding the law's coverage provisions for the time being.

Obamacare's premium subsidies are expected to cost $35 billion this year and $45 billion in 2018, according to Congressional Budget Office estimates. Some 9.3 million people who've signed up for coverage so far this year are set to receive these subsidies, which lower their monthly premiums to no more than 10% of their income. (Open enrollment ends Jan. 31.)

Perhaps more difficult for Republicans to swallow will be the $9 billion the government is expected to spend on Obamacare's cost-sharing subsidies, which lower the deductibles and co-pays for more than half of enrollees. That tab climbs to $11 billion next year.

These subsidies are at the center of a court battle between House Republicans and the Obama administration. Seeking to bring down Obamacare, the House filed suit in 2014 arguing the cost-sharing payments to insurers were illegal because Congress never appropriated the money.

Related: Federal appeals court puts Obamacare lawsuit on hold until after Trump's inauguration

A district court judge last year ruled in favor of the House, finding the payments were illegal and must stop. However, she stayed her decision, and the Obama administration filed an appeal. The case is on hold until after President-elect Trump's inauguration.

The House now will likely have to support the cost-sharing subsidies since killing them would wreak havoc in the individual market. Many insurers depend on these payments -- without them, they might leave the market, which could lead to fewer choices and higher premiums for consumers. Such a move would be at odds with the "orderly transition" Pence stressed as important to the incoming president.

Related: GOP lawmakers' dilemma: Obamacare enrollees in their district

Senator Lamar Alexander, who chairs the Senate Committee on Health, Education, Labor & Pensions, last week acknowledged the need to ensure that the millions who currently buy coverage on the exchanges maintain access to private insurance. This includes "the temporary continuation of cost-sharing subsidies for deductibles and co-pays," he said.

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