Home Economy Trump order encourages cheap insurance plans not subject to Obamacare rules

Trump order encourages cheap insurance plans not subject to Obamacare rules

3 min read

         Trump order encourages cheap insurance plans not subject to Obamacare rules

President Donald Trump signed an executive order Thursday directing federal agencies to consider expanding health-insurance coverage in low-cost plans that are not subject to Affordable Care Act rules, a move that could raise costs for sicker people.

The order is designed to provide what the White House calls “alternatives” to plans offered through Obamacare markets. It comes after the implosion last month of Republicans’ latest attempt to dismantle President Barack Obama’s signature health-care law, a chief policy goal that Trump and GOP lawmakers campaigned on.

See: Senate Republicans junk last-gasp effort to kill Obamacare.

Speaking before signing the order at a White House ceremony, Trump said consumers “will have so many options.”

“People will have great, great health care,” he added.

Trump also ordered the labor secretary to consider expanding consumers’ access to so-called association health plans. Those plans could allow employers to form groups across state lines, and allow access to more plans and lower rates, the White House says.

The order does not, however, allow such plans to market directly to individuals.

While the order stops short of dismantling Obamacare, health-insurance experts worry about the effect it could have on coverage. They say it could raise costs for the sick by drawing healthier and younger Americans to alternative plans, which could be less expensive.

States currently regulate health plans within their borders. The National Association of Insurance Commissioners has said interstate sales “will start a race to the bottom by allowing companies to choose their regulator.”

Trump was joined at the event by Sen. Rand Paul, a Kentucky Republican, who said the order would allow “millions of people” to buy insurance across state lines.

Market reaction to the news was muted. Aetna

AET, -1.16%

 and UnitedHealth

UNH, -1.20%

 fell slightly, while Humana

HUM, +0.44%

  and Cigna

CI, +0.01%

  advanced. The SPDR Health Care Select Sector ETF

XLV, -0.11%

 barely moved.

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