President Donald Trump signed an executive order Thursday morning intended to allow small businesses and potentially individuals to buy a long-disputed type of health insurance that skirts state regulations and Affordable Care Act protections.
The White House and allies portray the president’s move to expand access to “association health plans” as wielding administrative powers to accomplish what congressional Republicans have failed to achieve: tearing down the law’s insurance marketplaces and letting some Americans buy skimpier coverage at lower prices. The order is Trump’s biggest step to carry out a broad but ill-defined directive he issued his first night in office for agencies to lessen ACA regulations from the Obama administration.
Critics, who include state insurance commissioners, most of the health-insurance industry and mainstream policy specialists, predict that a proliferation of such health plans will have damaging ripple effects: driving up costs for consumers with serious medical conditions and prompting more insurers to flee the law’s marketplaces. Part of Trump’s actions, they say, will spark court challenges over their legality.
According to White House and agency officials, , the most far-reaching element of the multi-prong order instructs a trio of Cabinet departments to rewrite federal rules for association health plans – a type of insurance in which small businesses of a similar type band together through an association to negotiate health benefits.
The order will expand the availability of short-term insurance policies, which offer limited benefits meant as a bridge for people between jobs or young adults no longer eligible for their parents’ health plans. The Obama administration ruled that short-term insurance may not last for more than three months; Trump will extend that to nearly a year.
In addition, Trump’s action is intended to widen employers’ ability to use pretax dollars in “health reimbursement…