January 20, 2018: This month marks President Donald Trump’s first year in office. While on the campaign trail, President Trump made many promises in relation to healthcare, including, but not limited to, repeal and replace of the Affordable Care Act and “insurance for everybody.”
Although the Republican Party failed to repeal and replace the ACA through legislation, President Trump and the GOP have gained several key victories in the area of healthcare reform. In October 2017, through executive action, the Trump Administration rolled back the ACA’s contraceptive mandate, signed an executive order extending the sale of certain short-term and deregulated insurance plans, and ended Cost Sharing Reduction (CSR) payments for insurers. Then, in December 2017, Republicans passed the Tax Cuts and Jobs Act, largely on partisan lines. This legislation effectively ends the ACA’s individual mandate.
Paired with Trump’s recent public statements criticizing the U.K.’s National Health Service program, which comes just months after he praised Australia’s single payer system, it is unclear what actions the administration will take in the near future in regards to healthcare reform.
December 19, 2017: After failing to enact general healthcare reform to weaken the ACA earlier this year, Republicans turned to tax reform at the end of 2017. This week, they have passed the Tax Cuts and Jobs Act, which restructures tax brackets, but also effectively eliminates the ACA’s individual mandate.
The tax bill eliminates the individual mandate tax penalty for not having health insurance starting in 2019. Under the ACA, one must buy insurance or pay a penalty unless qualified for an exemption. Although most Americans acquire health insurance via their employer or from the government, according to Kaiser Family Foundation, in 2016, about 7% of Americans acquired coverage via the individual insurance market. Another 9% were left uninsured.
— You can read HRT’s explanation of the individual mandate here.
— For HRT’s explanation of an insurance “death spiral,” click here.
— HRT’s executive summary of the Tax Cuts and Jobs Act and its impact on the insurance markets is forthcoming.
— For the full text of Tax Cuts and Job Act, you can visit Congress’s website.
October 12, 2017: After Congress failed to pass a bill that would repeal and replace the Affordable Care Act before the reconciliation period expired, President Trump has taken two actions to undercut the ACA. First, he has signed an executive order that directs federal agencies to allow the interstate sale of association health plans, extend the length of coverage of short-term insurance policies, and expand the ability of employers to use health reimbursement accounts to shift coverage of their employees to the individual market. Secondly, the Trump administration has announced its intention to stop all Cost-Sharing Reduction (CSR) payments, as per the decision in the historical House v. Price case.
The executive order may have a widespread impact on the overall health of the ACA exchange markets. An association health plan is a form of insurance where small businesses band together through an association to negotiate health benefits. The executive order allow employers in the same line of work to form an association health plan together to offer healthcare to employees regardless of the state. This would allow people to buy cheaper insurance with fewer benefits than what the ACA marketplaces offer. These plans may attract healthy people, causing the marketplaces to have fewer healthy people and thus increasing premiums.
The executive order also changes the availability of short-term insurance policies. These policies offer limited benefits and are intended to offer temporary insurance to those between jobs or young adults no longer eligible for their parents’ health plans. Under the Obama administration, short-term insurance could not last for more than three months, but Trump’s order would extend that to almost a year.
— You can read HRT’s executive summary of the executive order here.
— For the full text of the executive order, you can visit the White House’s website.
— For HRT’s summary of the House v. Price case, click here.
— For the full text of the CSR payment announcement, you can visit the HHS website.