How Trump’s executive order affects health care plans and prices

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JUDY WOODRUFF: Since the efforts to repeal and replace the Affordable Care Act failed on Capitol Hill, President Trump has repeatedly taken steps to undercut and undermine the law, which he calls a nightmare for the American people.

In recent weeks, those steps have included shrinking the enrollment season for the individual insurance market, substantially cutting money for programs that sign people up, threatening to cut subsidies for insurers, and exempting more employers and businesses from providing birth control coverage.

Today, the president signed an executive order that could trigger the biggest changes yet.

William Brangham has the story.

WILLIAM BRANGHAM: The president’s executive order makes two principal moves.

It changes the rules over what are called association health plans. Those would allow some small businesses to buy cheaper insurance plans that provide fewer benefits and protections. It also expands the time frame for what are known as short-term insurance plans, which are usually used by people as a bridge between jobs.

Under the Obama administration, these plans could last for just three months. President Trump expanded those plans to a year.

Critics argue these changes will pull in younger, healthier people out of the ACA marketplace, leaving behind older, sicker people, who will then face higher prices and fewer options.

The president, however, today argued these changes were crucial to help save an already troubled marketplace.

PRESIDENT DONALD TRUMP: Premiums have gone skyrocketing. But, today, one-third of all the counties in America have only a single insurer selling coverage on an exchange. And next year, it looks like nearly half of all counties in our country. Think of that. All of the counties, one-half will have only one insurer. And many will have none.

WILLIAM BRANGHAM: These changes, of course, come just weeks before the next round of enrollment for the ACA begins.

So, what does this means for health care policy in America?

We turn to Avik Roy, president of the Foundation for Research on Equal Opportunity. He’s a senior adviser to the Bipartisan Policy Center and was a health care policy adviser for Republican presidential candidate Mitt Romney. And Andy Slavitt, he’s also a senior adviser at the Bipartisan Policy Center. And for two years, he served as acting administrator of the Centers for Medicare and Medicaid Services under President Obama.

Gentlemen, welcome both to you — to the NewsHour.

Andy Slavitt, I would like the start with you.

Today, you said about this executive order, you described it as long on propaganda, short on details, plenty of sabotage.

I wonder if you could explain.

ANDY SLAVITT, Bipartisan Policy Center: Yes. Well, thanks for having me on, William.

I think what’s important to understand is, the executive order is a first step in trying to do by fiat what Congress refused to do in repealing the ACA.

It essentially, as you described it, will set up two pools, a set of rules for insurers who will be lightly regulated and be able to offer insurance products that don’t have to contain the services like maternity services, and then the other pool of services, which will be the ACA plans, which will, because they will also sit right aside the other plans, we know what will happen.

The prices of those plans will go up, and it will make it much more expensive for folks to get coverage.

So, we’re going to have to see the details. This first step, though, looks exactly like what we expected.

WILLIAM BRANGHAM: Avik Roy, I know you have been a critic of the Affordable Care Act in the past.

I wonder what you made of the president’s move today.

AVIK ROY, Foundation for Research on Equal Opportunity: I would say this executive order is kind of like raindrops on a rhinoceros.

It’s not going to have that much effect at all. The executive order, the piece of it that talks about these association health plans that allow small businesses to pool together to form larger pools, that already exists.

There are groups called professional employee organizations, or PEOs, that can do that already, that can pool small businesses to buy health insurance in bulk. So, that’s not really going to have that much of an effect on the market. And the point about these short-term plans, all the president has done here is revert back to the rules that were in place a year ago under President Obama. It was only as the president, the last president, President Obama, was leaving office, that they restricted the length of these plans to 90 days. Before that, you could buy these plans up to 364 days.

All the president has done here is revert to those preexisting rules.

WILLIAM BRANGHAM: Andy Slavitt, well, you heard this, raindrops on a rhinoceros. Why are you so concerned about that, if it is so minor?

ANDY SLAVITT: Yes, I think what’s going to happen — and we have some experience with this — is that, look, if you’re young and healthy and a 27-year-old male, insurance prices will come down for you.

And I think if that that’s one of the things you’re trying to solve for, you know, you will have more options. That is not really, though, our biggest challenge right now. And if President Trump is really concerned with bringing premiums down, what will happen is, if you’re — if you have anybody sick as a small employer, or if you are in an ACA plan, and the people who are young and healthy are going to these 364-day plans, which is basically a loophole, then your premiums are going to get more and more expensive.

So, these are not actions today, to be clear, that are in any way going to help people afford coverage. They’re going to help some people get lower-cost, lower-quality plans, and they’re going to leave other people in trouble.

And that’s why the American Cancer Society came out very strongly today and said that they believe it endangers millions of cancer patients and their families.

WILLIAM BRANGHAM: Avik Roy, what do you make of that, that the trend here, if you provide these cheaper plans that are enticing to younger, healthier people, those people will move out of the ACA marketplaces and create this two-tiered system, where sicker, older people are in one, younger healthier people are in the other?

AVIK ROY: Well, and this is such an important point. So, I’m glad you asked the question.

People who are the younger and relatively healthier people, that actually is a huge policy problem under Obamacare. There are millions of people whose premiums who have doubled or tripled, on average, because of the regulations in Obamacare. So, they do need some kind of relief.

This executive order only provides really a limited amount of relief. In terms of the question about sicker people and how they get coverage, if their income is eligible for subsidies on the Obamacare exchanges, the value of the tax credits, the value of the financial assistance they get is going to expand even if the premiums go up.

So they won’t be affected at all. So, this is actually a way to provide relief to millions of people who are now priced out of the market, while actually preserving protections for those who want them in the traditional Obamacare exchanges.

WILLIAM BRANGHAM: Andy Slavitt, isn’t the concern there, though, that insurance companies will then pull out of those markets?

ANDY SLAVITT: That’s right.

I think the CBO estimated in the past that if something like this, which was an amendment proposed by Ted Cruz, were to make it into the final bill, what President Trump was talking about today, where some of the markets only have one insurer, many of them would abandon the post and say, it’s really not worth it for us to offer coverage anymore.

So, while I respect Avik’s point, the reality is, at any income level, the ability to get access to these products is going to go away. Remember, before the ACA, the majority of women in the country could not get maternity coverage unless they got it through their employer.

Mental health likewise is going to be in very, very short supply. So this is something that I think is going to create public health challenges very significantly, if it’s allowed to be implemented.

Now, again, remember, this is just a direction from the president. We’re going to have to see what happens when this goes to the departments, and to see if they can find a way that’s indeed legal and complies with state regulations to put some of these things forward. And I’m not so sure that it is.

WILLIAM BRANGHAM: Avik Roy, what about this concern that we know, when people buy health insurance, they often don’t really look at the details of their plans? And if there is the creation of a lot of plans that have less protections and less coverage, that people may buy them, think that they’re covered, but then find out when they get sick that the policy really doesn’t protect them.

Do you worry about that at all?

AVIK ROY: I think it’s a useful point.

Yes, you should have plans where people understand what they’re buying. But that is different from saying the federal government should determine in a very narrow way the only kind of insurance you can buy. Basically, the way Obamacare works is, you can buy any pickup truck you want, as long as it’s green, or any car you want, so long as it’s a green pickup truck.

So, there’s very limited choice in the kind of insurance you can buy. And so, yes, it’s important to have a consumer-friendly structure, so that people can understand what they’re going to buy, but it’s also important to have choice in the kinds of insurance you can buy, because if you don’t have choice, you don’t have competition, and you have much higher costs.

And that’s the problem that Obamacare has faced over the last four years.

WILLIAM BRANGHAM: All right, Avik Roy, Andy Slavitt, thank you both very much.

AVIK ROY: Thank you.

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