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Trump Signs Executive Order To Begin Unwinding Obamacare

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Having failed to repeal (or replace) Obamacare in the Congress on three separate occasions, on Thursday morning Trump took matters into his own hands, when as previewed last night, the President signed an executive order to begin the process of unwinding Obamacare, paving the way for sweeping changes to health-insurance regulations that would allow an expansion of less-comprehensive health plans.

“We’ve been hearing about the disaster of Obamacare for so long,” Trump said in signing the order at a White House ceremony. “For a long time, I’ve been hearing repeal, replace, repeal, replace.”

He then said that the order is “starting that process” to repeal ObamaCare. It will be the “first steps to providing millions of Americans with ObamaCare relief.”

The order will direct federal agencies to take actions aimed at providing lower-cost options and fostering competition in the individual insurance markets, according to the Wall Street Journal. The specific steps included in the order will represent only the first moves in his White House’s effort to strike parts of the law, the officials said adding that the order is just the beginning of the administration’s actions related to the health law. Furthermore, it will be months, rather than weeks, for even the most simple changes in the executive order to take effect, and the order leaves key details to the Labor Department, in particular, to determine after a formal rule-making process, including the solicitation of public comment.

While Trump’s order seeks to expand the ability of small businesses and other groups to band together to buy health insurance through what are known as association health plans (AHPs), and also lifts limits on short-term health insurance plans, in some ways the order’s impact remains a mystery as the full extent of the effects will not be immediately clear. The executive order largely does not make changes itself; rather it directs agencies to issue new regulations or guidance. Those new rules will go through a notice and comment period that could take months, officials said.

“The policies outlined in the executive order are the beginning of the actions the administration will take to provide relief to people harmed by Obamacare,” said Andrew Bremberg, director of the administration’s domestic policy council, on a call with reporters earlier Thursday. “You should expect additional actions coming from the administration in months to come.”


Critics however warned that the order could undermine the stability of ObamaCare markets by opening up skimpier, cheaper plans that would divert healthy people away from ObamaCare plans. They also warn that the policies outlined in the order will end up pulling healthier people out of Obamacare’s existing markets, which have strict requirements on what services have to be covered, such as maternity or mental health coverage. The result would be fewer people in the Affordable Care Act’s markets, and the ones who remained could be sicker – driving up premiums, and forcing more people to look elsewhere for coverage.

Democrats warn that the order is part of Trump’s larger plan to “sabotage” the health law and accomplish on his own what Congress could not; democrats have already been crying foul about administration cutbacks to outreach about the coming ObamaCare enrollment period, which begins Nov. 1, including a 90 percent cut to the advertising budget.

“Having failed to repeal the law in Congress, the president is sabotaging the system, using a wrecking ball to singlehandedly rip apart our health care system,” Senate Democratic Leader Charles Schumer (N.Y.) said in a statement. “If the system deteriorates, make no mistake about it, the blame will fall squarely on the president’s back,” he added.

Which, of course, is convenient for Obama’s signature legacy law, which was already sending premiums soaring over the past few years: now that Trump is doing what he can to undo Obamacare, he will become the scapegoat for everything that was wrong with the law in the first place. The bottom line is simple: if premiums continue rising – which they likely will – it will be Trump’s fault now.

By boosting alternative insurance arrangements that would be exempt from some key ACA rules, the change would provide more options for consumers. But health-insurance experts say it could raise costs for sicker people by drawing healthier, younger consumers to these alternative plans, which could be less expensive and offer fewer benefits.

“It would essentially create a parallel regulatory structure within the individual and small group markets that is freed from the various consumer protections established,” said Spencer Perlman, a policy analyst with Veda Partners, a Bethesda, Maryland-based advisory firm. “The end result could be a death spiral for ACA-compliant plans.”

Which, if the Democrats are right, is precisely what Trump hopes to accomplish.

No matter what the final outcome of Trump’s EO, one thing is clear: at least 12.7 million taxpayers will be happy with the outcome. As Bloomberg reports, according to the Internal Revenue Service, 12.7 million taxpayers claimed a health-care coverage exemption on their tax forms, some because they couldn’t find an affordable plan. Condeluci said people are sitting on the sidelines because the individual market is too costly.

“Now, there might be an option for them,” he said.

Of course, another 12 or so million will be less than excited: about 83% of the 12.2 million people in the Obamacare marketplace receive subsidies, i.e., premium tax credits, to help cover the cost of insurance premiums, according to the Centers for Medicare and Medicaid Services. For those who don’t get subsidies, the coverage can be expensive. The average monthly premium for a family of four with a $60,000 annual income was $1,090, or $13,080 a year for a mid-level “silver” plan, according to a 2016 report from the U.S. Department of Health and Human Services.

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