HEALTH CARE REFORM
Health Care Reform:
Will Things Get Worse Before They Get Better?
No one really knows the answer to this question, but we’ re here to offer an overview of where things stand on the healthcare rollercoaster after President Trump’ s first year in office. He was not successful in repealing the Affordable Care Act( ACA)— aka Obamacare— completely, but his administration did take steps that are likely to change the nature of the ACA— certain to weaken its impact— moving forward.
The most talked-about change to the ACA was the repeal of the individual insurance mandate, which was embedded within the Republican tax bill( i. e., the Tax Cuts and Jobs Act). Since healthier individuals are more likely to opt out of purchasing coverage than less healthy individuals, economists expect the remaining population under the ACA to be less healthy than average, causing premiums to climb. Another likely effect is that these healthier individuals that no longer have insurance coverage will be more likely to visit expensive emergency rooms for treatment. The result? Most likely, further increases in health care costs and premiums.
In addition to repeal of the individual mandate, President Trump signed an executive order that would greatly expand the ability of small-trade and business groups to form associations for the purpose of acquiring healthcare insurance, a welcoming option for small businesses and individual proprietorships. While these plans will still prohibit denial of coverage and discrimination against those with preexisting conditions, insurers will be allowed to assess different premiums to people, depending on their gender, age, industry in which they work, or other factors. These plans may prove very attractive to business owners seeking low-cost options, but they may also further fracture the ACA’ s core mission.
In addition, association plans would now be available across state lines, which, in theory would encourage healthy competition among insurance companies. In actuality, some fear that this change could have the opposite effect of closing the door to most insurers except the largest insurance companies.
President Trump threatened to withdraw reimbursements to insurance companies providing subsidies to low-income individuals. Without this underlying support from the government, insurance companies would be forced to raise premiums to cover costs for the underprivileged. A last-second compromise avoided this situation for the time being.
The Trump Administration also took steps to discourage enrollment by chopping the open enrollment period in half and sharply reducing media campaigns and other outreach measures. Despite these initiatives, enrollment for 2018 remained strong— only dropping by five percent versus the previous year.
All in all, the outlook for the ACA’ s survival is substantially gloomier than it was a year ago before Trump took office. Two big question marks remain. One is the degree to which President Trump will succeed in further weakening or eliminating the ACA during
the remainder of his term. The second is the overall economic outlook of the economy. While economic growth has been strong for most of the past eight years, a weakening of the economy in 2018 could cause further disruption in healthcare insurance markets.
One of our top responsibilities as health insurance agents is to understand the changes in health coverage laws and help our clients interpret them to their best advantage. We will continue to advise clients based on the information at hand as well as on our experts’ projections into the future under various scenarios. Contact us to learn more about how changes in health insurance markets may impact you and your company’ s own healthcare plan. You can contact Tara at tjaquet @ branchbenefitsconsultants. com or call her 702-646-2082. +
BY: TARA JACQUET, VP OF CLIENT SERVICES
Tara Jacquet brings 15 years’ experience to Branch Benefits Consultants with a background in managing large group employee benefits, developing plan designs and health care study data analysis in and out of the state of Nevada. Tara supports Branch Benefits Consultants’ goal of delivering tailored benefit solutions with thoughtful strategic planning, valuable professional services, and technologybased solutions by focusing on building strong strategic partnerships and serving a diverse and growing business community.
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