Trump order could upend ACA market after failure of repeal

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(Bloomberg) — President Donald Trump on Tuesday hinted on Twitter that he’s getting closer to signing an executive order that could erode Obamacare, after Republicans in Congress failed to pass a repeal bill.

The Wall Street Journal reported on Saturday, citing an administration official, that an executive order regarding association health plans would be signed this week. The official echoed the president’s Sept. 27 comments to reporters, when he said he would “be signing a very major executive order where people can go out, cross state lines, do lots of things and buy their own health care.”

An order allowing association health plans would give Americans in the individual market who don’t receive government subsidies another health care option outside of the Affordable Care Act. About 83% of the 12.2 million people covered by Obamacare health plans get subsidies that help them pay their premiums, according to the U.S. Centers for Medicare and Medicaid Services.

“Obamacare is so screwed up and so expensive, and it’s especially bad for people who don’t get subsidies. This gives them an alternative,” said Robert Laszewski, president of the Health Policy and Strategy Associates, a consulting firm specializing in assisting insurance companies and other clients through health policy changes.

The pending executive order is Trump’s latest attempt to follow through on his campaign pledge to get rid of his predecessor’s landmark bill. Last week, the president signed an order that stopped requiring many employers to offer birth-control coverage, saying it would protect Americans’ religious freedom.

Associations likely wouldn’t be required to sell to people with pre-existing health conditions and wouldn’t be required to offer 10 essential benefits set forth by Obamacare, Brookings Institute analyst Matt Fiedler said Monday. These benefits include pregnancy and newborn care, hospitalization, mental health and substance-abuse services and rehabilitation.

Fiedler said the damage to the individual insurance market would be “quite significant” because healthier people would seek cheaper coverage through associations, driving up premiums in the Obamacare market.

Bloomberg News