On Thursday, President Trump signed an executive order that bypasses Congress' failure to repeal and replace the Affordable Care Act, known by its more common name, Obamacare. While the president did not repeal Obamacare with his executive order, its provisions undercut many of the health care act's key provisions. Here's how Trump's Obamacare executive order will affect families, even if those effects may not be felt right away.
There is really one main takeaway from Thursday's executive order: Trump has no intention of actually helping families or children. Despite Trump's claims that his executive order will lower premiums, he's only presenting part of the picture. Trump's executive order would lower the regulatory bar for association health plans and short-term health insurance plans — and while doing so would lower premiums, it's a duplicitous statement. Of course premiums will be lower when these less-regulated plans offer substantially less health care.
By opening up association and short-term plans, younger, healthier individuals will flock to these cheaper plans that offer less coverage, creating a downward spiral for anyone left in the Obamacare exchanges. When healthy people leave an insurance market, the costs go up for those who remain in that market — which are the people who need good health care the most.
But first, a quick primer on what these two types of plans actually are. Association health plans are formed when several small businesses within a similar industry pool their buying power together to offer their employees cheaper health care. With the ACA, these associations had to be within the same state. Trump's executive order now allows associations to buy insurance across state lines.
Additionally, according to Vox, Trump's executive order is worded in a way so that regulations could be made to let self-employed people join association health plans. This would be huge, because it would mean more people would be able to leave the individual markets under the ACA.
Meanwhile, short-term insurance plans are those that, before the ACA, provided health care for up to 364 days. When the ACA became law, short-term insurance plans did not meet the individual mandate requirement, and President Obama limited short-term insurance plans to a maximum of three months, so people couldn't get out of the individual mandate by just re-upping a short-term plan every year. Trump's executive order lifts that 3-month limit.
In addition, Trump's executive order allows what are known as "junk insurance" plans to flourish once again, as they did before the ACA became law. These are plans that offer so little coverage, they shouldn't really be called insurance plans at all. So, what does this mean for families?
An exodus of young healthy people out of the individual markets in search of cheaper plans means that those who are still in those markets will face higher premiums. If your family gets their coverage through the individual market, you can expect your costs to go up if you intend on receiving the same level of care you have now, simply because there are less people paying premiums to support that level of care.
But what about those short-term and "junk" insurance plans? As Virginia Sen. Tim Kaine pointed out on Twitter, they are free to discriminate against people with pre-existing conditions, women, and the elderly because they don't have to offer comprehensive coverage — just the bare minimum at bottom of the barrel premiums. The domino effect caused by healthy people leaving the individual market for these skimpy plan would lead to "chaos," Kaine said on Twitter.
Additionally, any repeal puts families with kids who have disabilities at risk of having to pay incredibly high premiums if they have a marketplace plan — because healthy people will leave the marketplace — or if they opt for a short-term plan.
It is important to note that none of these changes would take effect right away: Trump's executive order instructs other federal agencies to write the actual regulations to meet the order's directives, which could go well beyond next year. It's also important to note that there is plenty of room for legislators and state attorneys general to file suit against the legality of parts of Trump's executive order, such as his ability to expand association plans. Still, that Trump has decided to take matters into his own tiny hands on dismantling Obamacare should concern every American family right now.
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