Think GOP Health Insurance Overhaul Is Stalled? Some Changes Already Are Underway

Even though House Speaker Paul Ryan was forced Thursday to delay the vote on legislation to repeal and replace the Affordable Care Act, major changes to health insurance already are afoot.

“The Trump administration has a great deal of flexibility to make changes that don’t require congressional approval,” says Elizabeth Carpenter, a senior vice president at Avalere Health, a healthcare consulting company.

The changes could result in sharply higher premiums and less coverage for many. For example, Health and Human Services Secretary Tom Price has said he wants to water down regulations requiring insurers to offer comprehensive coverage in 10 areas, including maternity care, prescription drugs and mental health services.

Consumers already are worried they could be priced out of the market. In a recent nationally representative CR Consumer Voices Survey, 55 percent said they’re not sure they or their loved ones could afford insurance to get quality healthcare.

A vote on the GOP overhaul could come as early as Friday, with reports that Trump was done negotiating and demanded that House Republicans fall in line behind the legislation.

Without the help of Congress, President Trump is limited in how much he can change the ACA. But here’s a rundown of what his administration already is doing to reshape parts of the current law.

Taking Executive Action

Trump on his first day in office issued an executive order for government agencies to change, waive or delay Affordable Care Act provisions considered a “burden” to insurers, doctors, drug companies, patients and states. The vaguely worded order pointedly undercuts the ACA’s individual mandate.

The mandate requires most people to buy insurance or pay a penalty to the IRS ($695 per adult and $347.50 per child under 18 but no more than 2.5 percent of your gross income). In February, the IRS followed Trump’s order when it announced it would no longer automatically reject the tax return of someone who didn’t check the box confirming health coverage or fill out the form to pay a penalty. People who don’t have insurance still owe the penalty— but the IRS isn’t going to hold up your return if you don’t provide the information.

Another executive action took aim at the ACA’s most recent open-enrollment period. Just five days before the January 31 signup deadline, the Trump administration directed Health and Human Services to halt TV ads encouraging people to sign up and ended other outreach efforts.

“These moves show that the administration has the power to make changes without jumping through a lot of hoops,” says Sara Rosenbaum, a professor of health law at the Milken Institute School of Public Health at George Washington University.
 

Wielding Administrative Power

HHS Secretary Price has made it clear he will use the department’s regulatory authority to chip away at the ACA. Last month, his department created a special section on its website detailing the actions it has taken and what it plans to do.

One such rule would involve a stricter verification process for people who want to sign up for health insurance outside of open enrollment because they claim a life event, such as getting married or having a baby. This change could mean delays in getting enrolled quickly.

HHS has also proposed shortening the open-enrollment period from three months to six weeks. For this year, that means sign-up would run from November 1 through December 15. Last year, the enrollment period ran from November 1 through January 31.

Price has also said he would like to water down the ACA mandate that insurers cover 10 essential health benefits, including maternity care, prescription drugs, doctors visits, emergency room care, lab tests, and mental health services. Trump and Ryan wanted to keep the requirements, but the House Freedom Caucus has demanded that they be removed.

Price can’t make the change without legislation, but he can issue new regulations that more narrowly define what coverage means.

Changes to the essential health benefit mandate could have a devastating effect, says Linda Blumberg, senior fellow in the Health Policy Center at the Urban Institute, a nonpartisan health and health policy research group.

If the essential health benefit rules are changed, insurers could sell what used to be called “junk insurance,” which offers limited coverage and may not even cover major illnesses. “Your premiums may be lower, but if you need care, you might have to pay out of your own pocket to get what you need,” says Blumberg.

People with pre-existing conditions could have needed treatments left uncovered, forcing them to pay for expensive, out-of-network treatments. “Yes, you can’t be denied insurance if you have a pre-existing medical condition. But if you have cancer, your insurer doesn’t have to cover chemotherapy, or if you have a hospital stay, they may only cover one day,” she says. 

Unintended Consequences

With the ACA’s future unclear, consumers could end up with fewer choices as insurance companies try to figure out whether they’ll participate in the ACA exchanges next year, what coverage their plans will offer, and how much they’ll charge.

The uncertainty has already driven out some players. Humana announced in February that it will exit all 11 states where it offered ACA plans, leaving 16 counties in Tennessee without an insurer offering a plan on the exchanges. “If the federal government doesn’t step in, people in some places may not have access to any insurance on the individual market,” says Carpenter. 

Other major insurance companies, including Anthem, Aetna and Molina Healthcare, have warned that they can’t commit to participating in the ACA exchanges in 2018.

“Just neglect and lack of action can do enormous damage to the insurance market and the ability for people to get affordable access to care,” says Blumberg.

More from Consumer Reports:
Top pick tires for 2016
Best used cars for $25,000 and less
7 best mattresses for couples

Consumer Reports has no relationship with any advertisers on this website. Copyright © 2006-2017 Consumers Union of U.S.