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White House: Cost-sharing healthcare subsidies won't be cut

March 13, 2014 at 5:51 PM   |   Comments

WASHINGTON, March 13 (UPI) -- Obamacare subsidies aimed at reducing co-pays and other expenses for the poor will not be subject to across-the-board U.S. budget cuts, officials say.

The change was included in the White House budget office report this week on the effect the cuts, known as the sequester, will have on spending in fiscal 2015, the Hill reported. Last year, the Office of Management and Budget said the cost-sharing subsidies would be reduced 7 percent.

The Affordable Care Act includes direct subsidies for insurance to people with low incomes in the form of tax credits. Those were not affected by the sequester.

But the law also provided subsidies to be paid to insurance companies to cover co-pays, deductibles and other costs normally paid by policy-holders.

"Over the coming 10 years, this exemption effectively translates to about $10 billion in restored cost-sharing subsidies," wrote research director Loren Adler of the Committee for a Responsible Federal Budget, which discovered the change.

The organization called the executive action a "big win" for the president's health care plan.

Health and Human Services Secretary Kathleen Sebelius said in testimony Wednesday before the House Ways and Means Committee health insurance premiums are likely to increase in 2015.

"I think premiums are likely to go up, but at a smaller pace than what we've seen since 2010," Sebelius said.

The increases seen in 2015 will likely be smaller than those seen in previous years, Sebelius said.

The number of young Americans signing up for health insurance has been below the level needed to keep premiums stable, the Wall Street Journal reported.

On Tuesday, the Obama administration said about 25 percent of people age 18 to 34 have signed up for Obamacare -- lower than a 40 percent target believed needed to keep premiums relatively stable.

Overall, 4.2 million people have signed up for health insurance since October, the administration said.

© 2014 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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