• On October 12, the Trump administration announced it would stop making cost-sharing reduction payments to insurers, because it lacked a constitutionally valid appropriation to do so—an action that restores Congress’ “power of the purse.”
  • While some have proposed that Congress should appropriate funds for the payments, such action would effectively reward insurers’ prior risky behavior—assuming cost-sharing reductions would continue to be paid, even after a federal judge struck them down as unconstitutional—thereby perpetuating moral hazard.
  • A better course of action is repealing the undermining regulations surrounding Obamacare, which necessitated the unconstitutional cost-sharing reduction payments to insurers in the first place.