(CNSNews.com) - Late Thursday night, the Trump administration announced that cost-sharing reduction payments to health insurers -- a key prop for Obamacare -- "must stop, effective immediately."
"CSR payments are prohibited unless and until a valid appropriation exists," said Attorney General Jeff Sessions in a legal opinion issued to the Department of Health and Human Services and the Treasury Department.
Sessions' legal opinion reads in part:
As you are aware, the prior administration originally sought an appropriation to fund CSR payments--suggesting it believed such an appropriation was necessary-–but then later concluded that section 1324’s permanent appropriation was available. The U.S. House of Representatives sued, contending that Congress had not appropriated funds for CSR payments. The U.S. District Court for the District of Columbia agreed, holding that section 1324 does not appropriate funds for CSR payments.
The memo notes that the Obama administration appealed the federal court’s decision, and the court put the appeal on hold, to allow time for potential legislative action by Congress, which never happened.
The memo also notes that while Congress did permanently appropriate money for Obamacare's permanent tax credits, it did not permanently appropriate money "to directly fund the CSR program."
"Congress has the power of the purse, and it is up to Congress to decide which programs it will and will not fund," Sessions wrote.
The announcement ending taxpayer subsidies to insurance companies to help people pay out-of-pocket costs follows President Trump's signing of an executive order earlier on Thursday that sets the stage for individuals in similar industries to band together for the purpose of buying health insurance, including across state lines.
Democrats pounced on Trump's earlier move as the "sabotage" of Obamacare, and they are no happier with the legal opinion issued Thursday night:
"Sadly, instead of working to lower health costs for Americans, it seems @POTUS will singlehandedly hike Americans’ health premiums," Senate Minority Leader Chuck Schumer fumed on Twitter Thursday night.
"It is a pointless act of vast, pointless sabotage leveled at our working families and the middle class in every corner of America. Make no mistake about it, @POTUS will try to blame the Affordable Care Act, but this will fall on his back and he will pay the price for it."
But House Speaker Paul Ryan (R-Wis.) issued a statement in support of Trump's move to end the illegal CSR payments:
Under our Constitution, the power of the purse belongs to Congress, not the executive branch. It was in defense of this foundational principle that the House, under the leadership of former speaker John Boehner, voted in 2014 to challenge the constitutionality of spending by the Obama administration that was never approved by Congress.
The House was validated last year when a federal court ruled that the Obama administration had indeed been making unauthorized and therefore illegal payments through Obamacare. Today’s decision by the Trump administration to end the appeal of that ruling preserves a monumental affirmation of Congress’s authority and the separation of powers. Obamacare has proven itself to be a fatally flawed law, and the House will continue to work with Trump administration to provide the American people a better system.
Trump spokeswoman Sarah Huckabee Sanders also issued a statement, saying: "The bailout of insurance companies through these unlawful payments is another example of how the previous administration abused taxpayer dollars and skirted the law to prop up a broken system."