By Jeff Manning and Hillary Borrud

Has the Oregon Insurance Division trumped Trump?

President Donald Trump signed an executive order early Friday that eliminated cost-sharing subsidies that helped low- and moderate-income Americans afford health insurance. About 50,000 eligible Oregonians stood to lose about $48 million a year in federal assistance.

Defenders of the Affordable Care Act blasted the president, accusing him of sabotaging a law he and fellow Republicans had repeatedly failed to repeal. In Oregon, Attorney General Ellen Rosenblum announced plans to join a multi-state lawsuit to block the funding cuts.

By late Friday, though, Oregon insurance regulators said they had figured out a way to increase a different federal health insurance subsidy – premium assistance payments -- that could more than cover the loss of the cost-sharing payments for many Oregonians.

The higher premium assistance payments won't come without some pain. The state said it will allow carriers a special, one-time 7.1 percent rate increase on silver plan policies.

In the individual insurance marketplace created by the Affordable Care Act, plans are sorted into one of four levels – platinum, gold, silver and bronze – depending on the amount of coverage. Silver plans are the most popular with about 80,000 Oregonians enrolled.

Oregon will join lawsuit against Trump's plan to stop Obamacare insurance subsidies

Friday's maneuvering marked the latest steps in the high-stakes political chess game over the Affordable Care Act. Trump and Republicans in Congress have tried and failed three times to repeal and replace the law, which they argue has led to higher premiums and fewer choices for consumers.

Democrats contend the Republican alternatives will cost millions of Americans their health care coverage.  The Congressional Budget Office estimated that 17 million Americans would lose coverage under the most recent Republican plan.

Now, rather than repeal the law, the Trump administration appears to be attempting to undo it piecemeal by executive order.

"Trump promised to lower Americans' health care costs, but today he has chosen to make them more expensive purely out of spite," said Sen. Ron Wyden, D-Oregon.

The federal subsidies that Trump cut were intended to reduce out-of-pocket costs, such as deductibles and copayments, to make health care more affordable for low- and moderate-income Americans. People who earned up to 250 percent of the federal poverty level could qualify. For a family of four, that would translate to annual income up to $61,500.

Insurance companies received the payments with the understanding they would cover a portion of patients' costs, according to the lawsuit filed Friday by 16 states attorney generals. People who benefitted likely would not know, because the assistance showed up only in the form of lower out-of-pocket costs when they shopped for insurance on the exchange, according to the Oregon Insurance Division.

For insurance carriers, who crave certainty when making long-term rate and coverage decisions, the Trump decision means more volatility. "The administration's decision to eliminate this key element of the Affordable Care Act further adds to an already uncertain and unstable market," according to Cambia Health Solutions, the parent company of Regence BlueCross BlueShield of Oregon. "Without a workable solution, next year will see higher premiums for all consumers and fewer people covered."

State insurance regulators worry that ending the subsidies will prompt insurers to drop out of certain parts of the state. "There are no threats on record, but the economics of it are very real and the threats to the stability of the market are very real," said Jake Sunderland, spokesman for the Department of Consumer and Business Affairs. "That's why we made it a priority to respond to this act of sabotage of the market."

The financial hit to insurers in the remaining three months of the year will be relatively small: $11 million in canceled federal payments, out of approximately $6.5 billion in total premiums on those plans, according to state insurance officials.

Jean Straight, acting director of the agency that regulates insurance rates, said it will be a challenge to adjust insurance rates in just three days. "It's going to be a lot of work," Straight said. "But my staff are telling me we can make that happen."

In fact, staff at the Department of Consumer and Business Services had been preparing for the White House to make a move like this since the summer, according to Straight and agency spokesman Sunderland. "We have been for months now analyzing the law, federal and state, to see exactly what we'd be allowed to do," Sunderland said.

As in the prior Republican efforts to derail the Affordable Care Act, some powerful players in the health care industry voiced qualms about the GOP plans. Providence Health and Services, one of Oregon's largest insurers, said its low-income customers relied on the cost-sharing payments to help with ever-expanding copayments and insurance deductibles. It called on federal and state officials to come up with a long-term solution.

In the meantime, Providence credited the state insurance division for its quick work. "Based on the actions taken today by the state, we believe market stability has been achieved for 2018, enabling us to continue providing access to health care services in the communities we serve," the company said.

Attorney General Rosenblum said Friday that she had to join the lawsuit to prevent Trump's plan form hurting low-income Oregonians. The other states are Kentucky, Massachusetts, Connecticut, Delaware, Maryland, North Carolina, Illinois, New York, Washington, Vermont, Pennsylvania, Rhode Island, Virginia, Minnesota, New Mexico and Iowa.

"Once again, the White House has made a rash, ill-conceived decision that will have a devastating impact on many vulnerable Oregonians," Rosenblum said in a written statement. "I refuse to sit by! The President should be in the business of helping—not wrecking-- Americans' financial bottom lines and access to quality health care."

-- Jeff Manning; 503-294-7606; jmanning@oregonian.com

-- Hillary Borrud; 503-294-4034; hborrud@oregonian.com; @hborrud