Jim’s Take

On Friday the 13th (heh-heh) President Trump signed the Executive Order that he says is designed to promote “Healthcare Choice and Competition Across the United States.”

So is that what it is, as the President’s supporters contend, or is it, as Senators Chuck and Nancy and their admirers argue, a deadly blow to healthcare in the U.S.?

I believe that there are some very attractive aspects to it. And a few (hidden, or at least not acknowledged) pitfalls. The three primary areas that the EO addresses and that the Administration plan to focus on:

  • Expanding access for small business to Association Health plans to control costs
  • Expand availability of short-term, limited duration insurance
  • Expand availability and permitted uses of health reimbursement arrangements.

There is a subsidiary issue about which Trump has been criticized and about which the government is being sued by some 13 states including Massachusetts: the discontinuation of subsidy payments to insurers.

Insurance Subsidies

Let’s start with the subsidies. President Trump ordered Friday that the Federal Government cease subsidies to insurance companies for Obamacare coverage. The subsidies were implemented by President Obama’s administration to offset the impact of too few young adults purchasing insurance, which is causing “adverse selection” and higher costs that swamp the allowable premium collections.

However, Congress refused to authorize the payments. Last May, in U.S. House of Representatives v. Burwell, Judge Rosemary Collyer of the U.S. District Court for the District of Columbia ruled that it was unconstitutional for the executive branch to make these insurer subsidy payments without Congressional authorization.

Judge Collyer said in her ruling, “Such an appropriation cannot be inferred, no matter how programmatically aligned the Secretaries may view (the applicable sections). So she struck down the payments as illegal.

President Obama was fond of reminding us that “We are a nation of laws, not men.” I agree with that wise position. Unfortunately, deciding to pay payments that Congress hasn’t authorized effectively runs totally counter to that statement of the President.

So President Trump is saying that Congress should get off the dime and either approve or disapprove the payments. Make them legal and then fund them, or refuse to do so and let the ACA flounder.

I agree, and I also agree with critics of Trump who contend that it will cause more disruption. But here’s the key fact – 2018 rates are already set, so any impact from this decision won’t take effect until next year’s renewal rates (i.e. those for 2019, not those for 2018. Shouldn’t the GOP and the Dems be able to hammer this out in A YEAR? Geeze, I would hope so.

I will take up the other three EO’s tomorrow.