One of the major subplots to last year's effort to repeal and replace Obamacare was President Trump's decision to cut off Obamacare payments to insurers.

When Trump ultimately pulled the plug on the funding, known as cost sharing reduction payments, it was portrayed as a nuclear bomb dropped on the insurance industry and consumers.

Democratic leaders Sen. Charles Schumer and Rep. Nancy Pelosi called it "a spiteful act of vast, pointless sabotage leveled at working families and the middle class in every corner of America." Eighteen states sued the Trump administration to block the move. America's Health Insurance Plans, the largest insurance lobbying group, warned it would destabilize markets and raise costs.

A bipartisan group lead by Sens. Lamar Alexander, R-Tenn., and Patty Murray, D-Wash., pushed legislation aimed at restoring the funding among other efforts to pump money into Obamacare (a form of which could still make it into the omnibus spending bill).

Yet on Monday, the Robert Wood Johnson Foundation is out with a report, based on extensive interviews with 10 leading Obamacare insurers, which notes that "Several insurers were concerned about proposed federal legislation to restore CSR funding," warning that it "could result in significant disruption and sticker shock for consumers receiving premium tax credits."

The report quotes one representative as saying restoring the funding “is not helpful at all."

Wait, what? How is it possible that just a few months after we were warned of total meltdown in the insurance market due to Trump's cutting off of the payments, some insurers are now predicting sticker shock and disruption if those same payments are restored?

Though the report notes that insurers did find Trump's move extremely disruptive at the time, particularly as it was announced weeks before the start of open enrollment, they also talked about how they were able to work with state commissioners to respond to the problem.

What happened was that state regulators allowed insurers to concentrate their premium hikes among mid-level "silver" plans, which are used to calculate Obamacare's core subsides for individuals to purchase insurance. That enabled qualifying individuals to receive much higher federal subsidies, creating situations in which they were effectively able to purchase "gold" plans for the price of silver plans, or to obtain "bronze" plans at no cost to them.

According to the report, some insurers now say "many consumers are now 'getting a good deal,' thanks to higher premium tax credits, and that restoring CSRs would cause considerable confusion during the 2019 open enrollment season and lead to sticker shock for consumers who had switched to gold- or bronze-level plans this year."

This status quo, of course, is not a particularly free market solution. With Obamacare in place, in practice, it means that taxpayers are forking money over to insurers in the form of one set of subsidies rather than another. But it is a case study in how markets can respond in unexpected ways to changes in federal policy, and also shows us the danger of giving government so much control over markets. When policies can vary so much from administration to administration, or even year to year, it keeps markets in a constant state of upheaval with consumers facing disruption.