This week, Trump has done everything he can to single-handedly destroy Obamacare. On Thursday, he signed an executive order to loosen regulations on association health plans and end a three-month time limit imposed by Obama for short-term insurance. This essentially allows for the proliferation of cheaper, skimpier, and less-regulated plans. And then just hours later on the same day, Trump announced that he was going to cut off cost-sharing Obamacare subsidies that help lower-income people pay for healthcare.
Trump has been threatening many of these actions for months, sowing continued uncertainty into the system, but the focal point had always coalesced around the battle to pass Obamacare repeal legislation in Congress. After that effort dramatically failed on three different occasions, it has become depressingly clear that Trump doesn’t need Congress to work to destabilize Obamacare all on his own. As Chad Bolt, policy manager for healthcare at Indivisible, a grassroots activist organization, puts it, “This is repeal by executive order.”
When it comes to the order that was signed Thursday morning, much of its impact will eventually be determined by the details of the regulations that agencies end up writing. But experts fear that the order will open up more opportunities for people to buy cheaper, less comprehensive plans. Short-term insurance, for example, is not subject to most of the ACA’s regulations, such as covering people with pre-existing conditions. Here’s Dylan Scott explaining the order’s impact on association health plans, or when groups of small businesses band together to buy health insurance, at Vox:
Under the executive order, new regulations would seek to expand the use of association health plans, easing federal rules that require associations be from the same state and that prevent associations from forming exclusively to provide health coverage. … If that change were made, association health plans would be freed to craft skimpier (and cheaper) health plans that appeal only to businesses with younger and healthier employees. Small businesses left in Obamacare’s marketplace would likely face higher costs and fewer options as the market became less attractive to insurers.
Essentially, this could create parallel insurance systems, in which younger, healthier people would drift away from regulated Obamacare plans and toward these cheaper, skimpier plans. This would jack up the prices for plans that continue to be regulated by the ACA’s higher standards—as Jonathan Cohn explains at HuffPost, “The insurers operating these plans would have to raise prices, because they would be losing healthy consumers whose premiums pay the bills of people with serious medical conditions.”
While the effects are not yet certain, blowing up Obamacare subsidies, which totaled an estimated $7 billion last year, could destabilize the market just weeks before enrollment. Some insurers have already increased their premiums for their 2018 plans by as much as 20 percent in anticipation that Trump might cut off subsidies, but some assumed that they would continue:
By ending the payments, there is now a lot of pressure on Congress to pass legislation to fund the subsidies. Bolt notes that it is important that Democrats not only push for the subsidies, but also to address the patient protections that are undermined by Thursday morning’s executive order.
The timing of all of this is also a form of sabotage in and of itself—open enrollment for Obamacare is due to start in just two weeks. “Trump is intentionally trying to create confusion so that people don’t know what to do. People don’t know if the ACA still exists, if they can still sign up,” Bolt told Splinter. Indivisible groups are working to do outreach on the ground to make sure people know that enrollment is starting.
Add this to last week’s decision to allow employers to opt out of covering birth control and the administration’s numerous tactics to sabotage ACA enrollment, such as reducing the open enrollment period from 12 to six weeks and cutting funding for advertising, and you get a healthcare system that is fully owned by Trump and Republicans. Despite what the president might say, Obamacare markets were stabilizing earlier this year. But of course, Trump is already blaming Democrats for his actions:
As many have pointed out, it’s actually Republicans who will be pressured to find a “fix” for the subsidies, since not funding them will harm constituents in their own districts. And there is no incentive for Democrats to accept any sort of repeal bill, all previous versions of which would have been much worse for Obamacare than what is currently happening. But one thing should be made clear if Republicans and Trump allow the healthcare market to collapse: it will no longer be Obamacare—it will be Trumpcare through and through.