WASHINGTON — President Donald Trump on Thursday ordered his administration to make it easier to buy cheaper health insurance with fewer benefits and protections, as he took unilateral steps to undermine Obamacare after Senate Republicans failed to repeal it.
“This is going to be something that millions and millions of people will be signing up for, and they’re going to be very happy,” Trump said as he signed an executive order directing agencies to rework regulations on health insurance, a process that could take months to complete.
“We aim to allow more small businesses to form associations to buy affordable and competitive health insurance,” Trump said, allowing health care plans to operate across state lines to create competition among insurers and to lower prices for “flexible” plans.
Larry Levitt, a health-care expert at the nonpartisan Kaiser Family Foundation, said, “The clear intent of the president’s executive order is to deregulate health insurance, How far it’s able to go remains unclear.”
Levitt and other health care experts warned that the order could end up raising premiums and costs for those who are older and sicker who buy insurance with Obamacare’s more expansive coverage requirements in the individual marketplace, as younger, healthier people leave and switch to buy cheaper association insurance.
The order would allow employers to band together as associations anywhere in the country to offer health-care plans to their employees, usually in the form of unregulated insurance with lower premiums but less comprehensive coverage.
“This will create tremendous competition and transformative, in so many ways, change aimed at creating more and lower prices for millions of Americans,” Trump said.
The order also extends the life of short-term health plans from three months to a year. These plans are cheaper than those offered in the individual market but are not required to offer all the same required benefits, such as maternity care, prescription drugs and addiction treatment.
“These health insurance policies are not subjected to any very expansive and expensive Obamacare coverage mandates and rules,” the president said.
And it allows greater contributions by employers of tax-free dollars into employee health accounts to reimburse them for their out-of-pocket costs and other health expenses.
Trump’s action won support from conservative advocacy groups, the national small business lobby and the U.S. Chamber of Commerce, but drew criticism or caution from physicians and hospital groups, state insurance commissioners and Democrats.
America’s Health Insurance Plans, a trade group, said it would engage in shaping the new rules and apply principles of “competition, choice, patient protections and market stability.”
Dr. Charles Rothberg, a Patchogue ophthalmologist and president of the physicians’ Medical Society of New York, warned that the order could result in “anti-consumer” problems.
“It could result in more consumers purchasing plans with more exorbitant out of pockets costs, fewer choices of physicians, and a reduction in the ability of patients and physicians to enforce provisions of a health insurance contract,” said Rothberg.
Senate Minority Leader Chuck Schumer (D-N.Y.) said Trump was taking a “wrecking ball” to the Affordable Care Act. “It will send costs soaring for older Americans and those with pre-existing conditions, and add further chaos to the markets.”
Juanita Duggan, the president and CEO of the National Federation of Independent Business, a small-business trade group, expressed gratitude to Trump for “addressing regulations that make it harder and costlier for small business owners to provide health care.”
“The President’s Executive Order pulls the rug from under the Affordable Care Act, which helped New York expand access to affordable health care to millions of New Yorkers, and takes aim at essential health benefits and protections for people with pre-existing conditions,” said New York Gov. Andrew Cuomo in a statement.