President Trump signed an executive order on Thursday, October 12, 2017 promoting healthcare choice and competition.
What Is in the Executive Order?
The National Association of Health Underwriters (NAHU) reports that the executive order signed by President Trump directs the secretary of Labor, R. Alexander Acosta, to consider proposing regulations or revising guidance to expand Association Health Plans. The intent of this directive is to allow employers in the same line of business anywhere in the country to join to offer healthcare coverage to their employees. It could potentially allow employers to form Association Health Plans through existing organizations, or create new ones for the express purpose of offering group insurance. This could lead to the sale of insurance across state lines through Association Health Plans; however, more action will need to be taken by the Department of Labor before this option can be available, and NAHU has urged the Administration to work closely with state insurance commissioners across the country to ensure that the rules that are enacted to allow such plans are able to address concerns by state policymakers regarding Association Health Plans crossing into the markets within their borders.
The executive order signed by President Donald Trump directs the Secretary of Health and Human Services, Eric D. Hargan, Secretary of Treasury, Steven Terner Mnuchin, and Secretary of Labor to consider proposing regulations or revising guidance to expand short-term health insurance – limited duration insurance. This directive would allow the agencies to revisit the rule enacted by President Obama’s Administration that limited the length of short-term health insurance plans to three months. The three-month duration limit on short-term health insurance was implemented on April 1, 2017. Prior to April 1st, short-term health insurance plans could be enforced anywhere from 30 days up to twelve months.
The executive order signed by President Trump directs the secretaries of Health and Human Services, Treasury, and Labor to consider proposing regulations or revising guidance to expand Health Reimbursement Arrangements. The intent of this directive is to allow employers to contribute more to their employees’ Health Reimbursement Accounts. Health Reimbursement Arrangements are employer-funded accounts that reimburse employees for healthcare expenses, including deductibles and copayments. The Internal Revenue Service does not count funds contributed to an Health Reimbursement Account as taxable income. The intent of this directive is to expand Health Reimbursement Accounts, which could provide employees with more flexibility in how their healthcare is financed.
What Happens Next?
The executive order signed by President Trump directs the secretary of Labor to act within 60 days to consider proposing regulations or revising guidance on Associated Health Plans. It also directs the secretaries of Treasury, Labor and Health and Human Services to act within 60 days to consider proposing regulations or revising guidance on Short term – limited duration plans, and for the agencies to act within 120 days to consider changes to Health Reimbursement Arrangements.
Within 180 days, the secretary of Health and Human Services, in consultation with the secretaries of Treasury, Labor and the Federal Trade Commission, must report to the president on state and federal laws, regulations and policies that limit healthcare competition and choice, as well as on actions that federal and state governments could take to increase competition and choice and reduce consolidation in healthcare markets.
The executive order signed by President Trump for healthcare does not direct the agencies to adopt specific regulations; therefore, for any policies to change, the agencies will have to go through the traditional rulemaking procedures of providing a proposed rule for public comment before being able to enact any final rules.
What about Open Enrollment for 2018?
At this time, nothing in the executive order sign by President Trump for healthcare will affect open enrollment for 2018 unless regulatory action is taken by the agencies. Until any such regulations are enacted, the Affordable Care Act “Obamacare” and all of its regulations, penalties and enforcement remain the law of the land.
MUST READ NAHU’s Statement on Today’s Executive Order, National Association of Underwriters, 12 October 2017, Accessed 12 October 2017.
