Last Thursday on October 12, 2017, President Trump no longer sat on the sidelines to wait and see the fate of health care. He, instead, took action to sign an executive order outlining three main objectives to be reviewed and eventually implemented. Within the executive order, President Trump mentions that the current ACA legislation has amounted to “one-third of America’s counties having only one insurer offering coverage on their applicable government-run exchange in 2017.”
President Trump’s executive order aims to expand the ability to offer more association health plans (AHP’s), offer short-term limited-duration insurance (STLDI), and expand the use of Health Reimbursement Arrangements (HRA’s). Let’s take a moment to break each of these down:
AHP’s will allow companies in a similar industry and/or geographic locations to come together and potentially purchase health care, thus leveraging their proverbial purchasing power. One thing to note is that such associations exist today and are available to employer groups in certain capacities. Expansion of these opportunities can have a positive impact on the marketplace, so we will be eager to hear exactly what handcuffs will be removed and, even more importantly, the health insurance carrier’s appetite to administer said new opportunities.
STLDI’s are exempt from the mandates and regulations included in Title I of the PPACA. STLDI’s exist today but are only made available for coverage periods of less than 3 months. Expect these plans to be made available for longer periods of time and, thus, this is the language President Trump is communicating when he mentions lower and more affordable plans.
Finally, the expanded use of HRA’s will likely lead to the ability for employers to now use HRA’s to also pay for premiums, whereas today, traditional HRA’s are used for deductibles, coinsurance, and copays. This may lead to an increased appeal for employers to offer strong coverage to their employees and leverage additional tax benefits by subsidizing premiums.
Expect to hear more over the next 60-120 days on the direction of these initiatives and how they may impact employer groups and the individual market.
Until then, work through open enrollment decisions and strategy….. after all, the end of the year will be here before we know it!
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