Subsidies, Not Bailouts
President Donald Trump said “bailouts for insurance companies” would “end very soon” if Congress didn’t pass a new health care bill. Sen. Susan Collins said the payments aren’t a bailout, “but rather help people who are very low-income afford their out-of-pocket costs.”
Trump distorts the facts. It’s true that the money involved goes directly to insurance companies, but, as Collins said, the payments lower out-of-pocket health care costs for low-income individuals. We’ll explain how these payments work.
The president gave his description in a July 29 tweet:
If a new HealthCare Bill is not approved quickly, BAILOUTS for Insurance Companies and BAILOUTS for Members of Congress will end very soon!
— Donald J. Trump (@realDonaldTrump) July 29, 2017
A “bailout,” , is financial assistance to save a failing company or industry. The 2008 , for instance, provided billions to stabilize financial institutions and the auto industry. Under that bailout, of its investments in the auto industry and on its bank investments. (Trump also misuses the word “bailout” to describe the federal government’s contribution toward health insurance premiums for members of Congress, but we will get to that later.)
