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NHF Healthcare Update: Trump Executive Order and Cost-Sharing Reductions Changes

October 17, 2017
NHF Healthcare Update: Trump Executive Order and Cost-Sharing Reductions Changes

Recently, President Trump made a number of announcements related to health insurance:

First, President Trump announced that the Administration will discontinue making cost-sharing reduction (CSR) payments to health insurance companies that subsidize out-of-pocket costs for low-income people. Each month, there have been questions about whether the Trump Administration would continue these payments to insurers. Plans in a number of states have increased premiums in anticipation of the CSR payments stopping, but the biggest risk for consumers is that insurance companies will drop out of the marketplaces for next year. A number of state Attorneys General have said they will file lawsuits so that the CSR payments continue.

In addition, President Trump signed an executive order (EO) that seeks to increase competition by facilitating access to different types of health insurance coverage. Nothing is changing immediately; rather, President Trump has directed several government agencies to draft regulations to implement new policies over the next 60 to 120 days related to three types of insurance products vehicles:

  • Association Health Plans (small businesses can join to purchase insurance coverage through associations),
  • Short-Term Limited Duration Insurance Products (plans that last less than a year), and
  • Health Reimbursement Arrangements (employers can give employees money to purchase insurance rather than provide it directly).

Experts disagree about whether and how these policies can be implemented via regulation, so it is not clear what the effects of these new policies may be. Since association health plans and short-term insurance products are not required to follow ACA patient protections, they could appeal to younger, healthier people who seek skimpier, less expensive coverage. This would raise costs for people who need comprehensive coverage.

The combined effect of these policies adds further uncertainty to the health insurance market, where insurers and individuals are preparing for the start of open enrollment on November 1, 2017. These actions also add new pressure for Congress to pass legislation to stabilize health insurance markets, since many in Congress want to fund the CSRs and implement other policies to stabilize the marketplace.

NHF will be closely monitoring regulations to implement President Trump’s executive order and potential legislation in Congress regarding insurance markets. We will continue to advocate for access to comprehensive, quality insurance for people with bleeding disorders and will update the community as more information about the impact of these changes becomes clear.