WASHINGTON—President Donald Trump made one of his most explicit threats to cut off payments to insurance companies to force senators and lobbyists back to the bargaining table for a GOP health-care bill, and saying, for the first time, that he was also willing to cancel some of lawmakers’ health-care benefits.

“If a new HealthCare Bill is not approved quickly, BAILOUTS for Insurance Companies and BAILOUTS for Members of Congress will end very soon!” Mr. Trump tweeted Saturday.

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Mr. Trump’s statement came less than two days after the collapse in the Senate of Republicans’ effort to overturn the Affordable Care Act.

For months, Mr. Trump has threatened to stop reimbursements to insurance companies—a part of the ACA—but his administration has always paid them in the end, including amid significant uncertainty in June and at a crucial moment in GOP negotiations just a week ago in July.

The next set of payments, which total millions of dollars for insurers that have lowered deductibles and other out-of-pocket costs for the poorest enrollees in coverage under the law also known as Obamacare, is due in three weeks.

Those payments have been challenged in court by House Republicans, who argue the funds were never authorized by Congress. A federal judge has sided with the House but allowed the payments to continue until the litigation concludes.


Democrats have said that cutting off the payments would be tantamount to sabotaging the insurance markets, and that Republicans will bear the blame.

“If the president refuses to make the cost-sharing reduction payments, every expert agrees that premiums will go up and health care will be more expensive for millions of Americans. The president ought to stop playing politics with people’s lives and health care, start leading and finally begin acting presidential,” said Sen. Chuck Schumer (D., N.Y.) on Saturday.

Mr. Trump’s Saturday tweet came on the heels of several others expressing his disappointment that GOP senators had so far failed to come together around a single piece of legislation that would fulfill a shared campaign pledge of repealing the ACA and enacting their own set of proposals in its place.

It was also the first to mention that he was open to another idea proposed by conservative activists to pull lawmakers back to the task of a health-care bill: cutting off their existing health benefits.


Activists including Heritage Action, the political arm of the conservative Heritage Foundation, have proposed that Mr. Trump’s administration change a rule promulgated by the Office of Personnel Management during the Obama administration that allows members of Congress and their staff to obtain subsidized insurance alongside other Washington, D.C., small businesses.

That rule has been the subject of significant contention for years, with some lawmakers contending that it is an end-run around a provision in the 2010 health law that requires members of Congress to get their health coverage like other Americans. Lawmakers and their aides get a hefty subsidy from their employer—Congress—when they buy coverage through the D.C. online insurance exchange, which critics contend is unique to them. Defenders of the rule argue that the provision was never intended to force members of Congress or their aides to lose the employer-sponsored health benefits that many people get on the job.

Effectively cutting off members’ existing health benefits would focus their attention, Heritage Action has argued.

“With the long-promised goal of repealing Obamacare and providing relief from the failing law slowly slipping away because of liberal intransigence, senators should finally subject themselves to the same burdens imposed upon their constituents. Maybe then they would come around to begin delivering on their longstanding promise,” wrote Michael Needham, head of Heritage Action, in an opinion piece this week.


Republican lawmakers scattered after the early Friday morning defeat of fallback legislation to dismantle parts of the ACA. Some have said they want to turn quickly to bipartisan bills that shore up the individual markets with steps such as an appropriation for the contested payments. Others have said they are still pursuing GOP legislation and are refusing to give up the idea they can come back after recess with a proposal that secures the support of at least 50 Republicans in the Senate.

Write to Louise Radnofsky at louise.radnofsky@wsj.com