President Donald Trump on Thursday signed an executive order that aims to succeed where Congress has failed in a bid to reshape the country’s health insurance markets.
The executive order does not in itself implement any policies, but rather directs federal agencies to draft regulations. Still, it offers a clear picture of how Trump intends to revamp healthcare policy through, as he put it in a recent tweet, “the power of the pen.”
The order seeks to do that by issuing three primary directives to federal agencies:
- Consider ways to expand access to association health plans, potentially allowing employers to purchase insurance across state lines.
- Consider expanding coverage through short-term health insurance plans, which are not subject to the Affordable Care Act’s regulations such as minimum coverage requirements.
- Consider changes to health reimbursement arrangements (HRAs)—employer-funded accounts that reimburse workers for healthcare expenses—to allow employers to make better use of them.
Here is the Executive Order to undermine the ACA.— Andy Slavitt (@ASlavitt) October 12, 2017
Long on propoganda. Short on details. Plenty of sabotage. 2/ pic.twitter.com/n64pcEoXfF
“With these actions, we are moving toward lower costs and more options in the healthcare market, and taking crucial steps toward saving the American people from the nightmare of Obamacare,” Trump said during a signing ceremony at the White House on Thursday.
The expanded use of association health plans, Trump said, would increase competition and allow thousands of small business employers to have the same purchasing options as large employers. “Insurance companies will be fighting to get every single person signed up,” he added.
Trump also suggested that one of the changes he has planned is to eliminate the three-month limit on short-term health insurance plans implemented by the Obama administration, which he argued crippled the market for such policies.
The president was less clear about his intentions to change the rules around HRAs, but The Wall Street Journal reports that the idea would likely be to allow employees to use them to buy their own insurance plans—which the ACA currently forbids.
Trump also noted that the executive order is far from his only attempt to remake healthcare policy.
“Today is only the beginning,” Trump added. “In the coming months, we plan to take new measures to provide our people with even more relief and more freedom.”
He also said Republicans believe they do in fact have the votes to pass an ACA repeal bill—despite evidence to the contrary and recent statements from GOP lawmakers.
”We are going to also pressure congress to finish the repeal and replace of Obamacare once and for all,” Trump said.
Experts, insurers wary
Though there aren’t many details yet on what policies will result from Trump’s executive order, healthcare policy experts have warned that some of the ideas it contains could have serious consequences.
Association health plans have a history of fraud, insolvency and segmenting insurance markets, Kevin Lucia, J.D., a research professor at Georgetown’s Health Policy Institute, previously told Kaiser Health News.
And the Kaiser Family Foundation’s Larry Levitt warned in a recent Twitter thread that association health plans would be able to “cherry pick healthy people and make coverage unaffordable for those with pre-existing conditions.”
Further, expanding the use of short-term policies has the potential to destabilize the individual insurance markets, since they can siphon off young, healthy consumers from the risk pool, according to the Robert Wood Johnson Foundation’s Kathy Hempstead.
Meanwhile, America’s Health Insurance Plans issued a statement indicating it will carefully evaluate the potential impact of Trump’s executive order and the rules that follow.
“We believe that all Americans should have access to affordable coverage and care, including those with pre-existing conditions. We believe that reforms must stabilize the individual market for lower costs, higher consumer satisfaction and better health outcomes for everyone. And we believe that we cannot jeopardize the stability of other markets that provide coverage for hundreds of millions of Americans,” said Kristine Grow, AHIP’s senior vice president of communications.