President Trump didn’t waste any time delivering on his promise to repeal the Affordable Care Act (ACA) when he issued an executive order on his first day in office instructing the Secretary of Health and Human Services (HHS) and other government agencies to begin steps towards diluting the law wherever possible. The executive order specifically targets measures of the law that would “impose a fiscal burden” or “cost, fee, tax, penalty, or regulatory burden” on individuals, doctors, hospitals and other providers, as well as insurers and drug manufacturers, hanging a target on the law’s controversial individual mandate.
The motivation behind Trump’s order is not exactly cloaked in mystery—the President has made his intention to dismantle the ACA as one of his first priorities upon entering office clear from the start. The executive order was testament to that. Yet, the order itself does not give the administration any powers that they didn’t already have at their disposal. However for some, the implications behind this move and the possible industry-wide reverberations, continue to fuel uneasy uncertainty.
Reading between the lines
A big concern among industry leaders is removing the individual mandate from the ACA which requires individuals to have health insurance or face a penalty. “Most of the provisions in the ACA can’t just be changed by HHS or the president; they require action from Congress or a lengthy period involving public comment,” according to FiveThirtyEight. This leads many to assume that the individual mandate, which the HHS can change, is at stake.
As we reported last week, eliminating the individual mandate would potentially leave millions without insurance and spike premiums, causing chaos in the market as insurers flee. Without the provision in place, it’s expected that younger, healthier individuals will leave the marketplace creating an upheaval within insurance plans and premiums for those remaining.
Robert Laszewski, president of the consulting firm Health Policy and Strategy Associates, told the Chicago Tribune that “Instead of sending a signal that there’s going to be an orderly transition, they’ve sent a signal that it’s going to be a disorderly transition.” According to Teresa Miller, Pennsylvania’s insurance commissioner, Trump’s executive order “just creates more uncertainty and adds more instability to this market.”
In response to Trump’s executive order, the Chicago Tribune reported “cautious praise” from Republican leaders on Capitol Hill. Yet, looking at a bigger picture, “the GOP remains in a state of uncertainty on health care” with still more questions than answers with no consensus on how to replace the ACA. Trump’s strong language and quick actions have perhaps consequently created urgency and more pressure among GOP lawmakers to fast track a resolution.
Politico reported that “just a small circle of officials at the Department of Health and Human Services knew about the executive action starting to unwind Obamacare, and only less than two hours before it was released.” Additionally, “key members of Congress weren’t consulted either, according to several members. And at a conference in Philadelphia, GOP legislators say they had no idea whether some of the executive orders would contrast with existing laws — because they hadn’t reviewed them.”
Now that a rather hot fire has been lit under the HHS, it is likely movement towards dismantling the law will proceed quickly. We can also expect to see more executive actions from the President relating to the ACA, according to Trump advisor Rep. Chris Collins, who added that the administration would try and ensure stability in the individual market while the GOP works on a replacement plan.
We will continue to update our readers on developments unfold surrounding the ACA as well as features on other healthcare industry news.