President Trump’s promised rollback of Obamacare has officially begun. But what does it all mean? And will it affect you?

The federal government will cut billions of dollars in health-care subsidies to low-income households that were introduced under Barack Obama’s Affordable Care Act, the White House announced last week.

These $7 billion in “cost-sharing subsidies” are the payments the government makes to health insurance companies to offset the discounts on co-payments that low-income consumers have received under Obamacare. The subsidies repay health insurers for the higher cost of the “silver plan” through HealthCare.gov — the individual insurance marketplace operated by the federal government and set up under Barack Obama.

The cuts in subsidies may actually hit the middle class the most

Insurers already put insurance premiums up 20% this year in anticipation of the President’s decision to end these subsidies. However, in several states, including Indiana, insurance companies spread their rate increases, so middle-class people on individual plans will likely see a double-digit increase in their premiums next year.

“People who don’t qualify for premium subsidies for cost-sharing reductions, but are also in the individual market because they don’t have employer-sponsored coverage — early retirees who aren’t yet eligible for Medicare or higher-earning freelancers — will be negatively affected by higher premium costs,” Susan Nash, partner at Winston & Strawn LLP in Chicago, Ill.

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