With outright Obamacare repeal bills having failed, President Trump on Thursday signed an executive order designed to circumvent health care marketplaces through promotion of so-called association health plans.
Trump says the move will lower premiums for many Americans by allowing them to buy health insurance across state lines, including through trade associations. Although signed today, the move was announced earlier this week.
As the Washington Post has reported, critics worry that the move would benefit healthy consumers while driving up costs for consumers with serious health problems, driving insurance companies out of marketplaces set up under the Affordable Care Act, as Obamacare is formally known.
Should consumers, employers and insurers be concerned? Not just yet, it seems, as some uncertainty still surrounds implementation of Trump’s vision.
As USA Today pointed out this afternoon, none of the changes would take effect immediately, and will require new regulations from the Labor, Health and Treasury departments. Such regulations will only come into effect after public comments are considered, USA Today added.
Patrick Michael Plummer, a professor of health administration at Penn State Harrisburg, sees potential winners and losers in the move.
“A large portion of Trump’s initiatives, including this expected ACA executive order, are based on reducing bureaucracy for small-and-medium sized businesses,” Plummer said this morning, before Trump signed the order.
“Trump expects, reasonably, that this will generate economic benefits at the grass-roots level to improve the overall economy,” Plummer added.
Here’s how Plummer expects the move may affect various parties:
• In the short- to mid-range, associations will be winners because they can add health plans for their members. Small- and medium-sized businesses will benefit from fewer regulatory requirements, lower costs and more customized plans. Employees of such firms will benefit, as will young people who won’t have to buy coverage they may not need.
• Insurers may suffer, however, because of increased competition: Trump’s order lowers entry barriers to the health insurance market, he added. The ACA itself, as well as its exchanges, could be undermined as a result.
Farther down the road?
“Like the ACA itself, the truth is that no one really knows how these moves will play out or its ripple effect in the long term,” Plummer said. “There is speculation (but) no one can foresee all the ripple when dealing with nearly 20 percent of the economy.”
What do Pennsylvania insurers say? So far, not much, as it’s not clear how Trump’s order will be implemented.
Representatives of Capital Blue Cross and the UPMC Health Plan, reached this morning shortly before the order was signed, said it was premature to comment. A representative of Highmark could not immediately be reached for comment.