AARP Hearing Center
President Trump has delivered a one-two punch to the Affordable Care Act (ACA). Late Thursday he announced the elimination of the subsidy payments to insurers that help lower-income Americans afford health care. That move came just hours after he signed an executive order that he says will promote more competition in the health insurance market.
The payments to insurers help fund subsidies that assist lower-income Americans in paying for deductibles, copays and other out-of-pocket health care expenses. The president had been threatening to cut off the subsidy payments for months.
The nonpartisan Congressional Budget Office had earlier estimated that if subsidy payments were withheld, premiums for individuals who buy the most popular health plans on the ACA health insurance marketplace would soar by 20 percent next year and 25 percent by 2020.
The president’s moves come just two weeks before the start of marketplace open enrollment. Insurers had threatened to abandon the marketplace if the subsidies were cut off. Some states have already signaled plans to challenge that action in court.
Congress has tried repeatedly over the past few months to repeal and replace the ACA. Thursday’s announcements are part of the president’s latest strategy to continue those attempts in the absence of congressional action. AARP has strongly opposed any repeal of the health care law.
The executive order directs the secretary of labor to consider expanding the ability of small businesses to form so-called association health plans. These plans may be able to avoid many state and federal insurance regulations. They could, for example, be exempt from the ACA rules that protect older Americans and people with preexisting health conditions from being charged far higher premiums as well as the ACA requirement to provide essential health benefits — such as emergency room care and mental health services.
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