Trump Issues Executive Orders Aimed at Rolling Back Affordable Care Act
Author: Robert S. Teachout, XpertHR Legal Editor
October 13, 2017
President Trump has issued two executive orders intended to weaken the regulatory structure supporting the Affordable Care Act (ACA) after efforts to repeal the health care law failed in Congress. The first order asks the US Department of Labor (DOL) to propose rules to allow more employers to participate in association health plans. The other order halts payment of subsidies to healthcare insurers.
The first executive order would let small businesses join nationwide associations for the purpose of buying large-group health plans that are not subject to ACA coverage requirements. Under the rules expected to be issued by the DOL, small businesses could band together to join nationwide associations in order to purchase large-group insurance policies that are stripped of many of the ACA's mandatory minimum benefits. Such plans can also be purchased across state lines, which some claim may help reduce costs.
Opponents argue that the order could violate the Employee Retirement Income Security Act (ERISA), which grants states the right to regulate association health plans. A multi-state plan could violate ERISA if it only complies with the insurance requirements of a single state. But White House officials say the DOL will carefully review ERISA in following the president's directives, to limit the risk of litigation.
Trump announced a second executive order today, halting $7 billion in subsidy payments to health insurers that participate in the ACA exchanges. The cost-sharing reductions (CSRs) are meant to help insurers comply with ACA requirements to help low-income enrollees afford the costs of co-pays and deductibles by covering some of the insurer's losses. The subsidies are different than the law's refundable tax credits that are used to help people pay for premiums.
Congressional Republicans had sued the Obama administration's Department of Health and Human Services over the CSRs, arguing that the payments are unlawful because ACA does not include language providing appropriations to cover the cost.
Trump stated while signing the executive orders that this was the beginning of executive branch efforts to dismantle Obamacare. Earlier in the week, the Trump administration also loosened the restrictions on religious exemptions to the ACA, allowing more employers to seek exemptions based on religious and moral grounds from the health care law's mandate to provide coverage for women's birth control.