Trumpcare Insurance Plans
Trump’s Healthcare Plan Explained
The Trump administration has made three efforts to reform, replace, or augment the Affordable Care Act (ACA or Obamacare).
The American Healthcare Act – The Past (July 27, 2017)
The term “Trumpcare” began as a nickname for the American Health Care Act (AHCA). The AHCA was a replacement program for the Affordable Care Act (ACA or Obamacare).
The U.S. House of Representatives passed the AHCA, but the U.S. Senate’s version of the bill did not get enough votes.
Due to the lack of support of the majority of the United States Senate, the bill never made it to the President’s desk to be signed into law.
Short-Term Health Insurance Plans – The Present Version of Trumpcare(August 1, 2018)
On August 1, 2018, the Centers for Medicare and Medicaid Services (CMS) changed rules that govern short-term health insurance plans. CMS made it possible for individuals to stay on a temporary health plan for to up to 364 days. That rule change became operative on October 1, 2018.
This change overturned a 2017 Obama-era rule that limited short-term health insurance from 364 days to 90 days. The new rules also made it possible for states to allow short-term plans to be sold in their country that cover individuals for up to three years.
Effect on State Regulations
These changes in regulations by CMS gave states regulators more freedom to change laws governing short-term health insurance. Consequently, the rule changes are being implemented differently at the state level.
States have taken one of three perspectives:
- Fast Movers: Some states permitted the short-term plans that were already available in their state today to return to the 12 or 6-month terms they’d had in 2017.
- Slow Movers: Other states need changes to the short-term plans available in their state before they allow those plans to cover persons for more than 90-days. In these states, 90-day short-term plans may still be a choice, with more options coming soon.
- No Movers: A final group of states have either banned short-term plans or made changes to the essential benefits in a short-term plan. When the needed benefits change, insurance companies have to develop new plans and get them approved by the state. In those cases, short-term coverage may not be available until the new plans are approved.
The Future of Trumpcare
Association Health Plans (AHPs)
In June of 2018, the Trump administration announced new guidelines governing Association health plans. These new plans would not have to meet all of the benefit requirements of the Affordable Care Act, like requirements to cover maternity care or mental health care.
They would function like primary medical coverage in the sense that all medical expenses would be covered after a consumers’ cost-sharing (deductibles, etc.) were met for the plan year. The plans would be “guaranteed-issue,” which means your application can’t be declined since you have a pre-existing condition.
Theoretically, the way this would work is for associations to make these health plans available to their members. These associations could define their membership and plan benefit requirements and then work with insurers to make the coverage available.
Purchasing Across State Lines
One of the perceived benefits of association health plans is that an insurance company could file a plan in a single state, get it approved in that state, and then provide “across state lines” in multiple states.
This practice happens today with limited benefit health insurance plans provided through associations.
Health Reimbursement Arrangements (HRAs)
New rules proposed on October 23, 2018, would enable employers to fund Health Reimbursement Arrangements (HRAs) for employees. In turn, employees can use that money to pay for health insurance plans they purchase on their own on health insurance marketplaces like eHealth.com.
The new proposal would give states the authority to make these changes through state innovation waivers included in the Affordable Care Act.
The new HRAs rules aim to encourage small businesses with less than 50 employees to pay for employees’ healthcare coverage. These employers are not subject to the employer’s requirements for the ACA’s mandate to offer coverage.
The Trump administration’s proposed rule on HRAs would give employers another way to provides financial assistance to workers who can’t afford to purchase health coverage on their own.
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