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Trump accused of sabotage after signing executive order to weaken Obamacare

Donald Trump was accused of sabotaging the Affordable Care Act on Thursday when he used an executive order to unilaterally weaken Obamacare following months of failed attempts by Republicans to repeal it.

The president’s order expands access to cheaper and less comprehensive insurance, which experts predict will result in health plans for the sick becoming more expensive.

But Trump hailed his move as a step forward for the US health system.

“This will cost the United States government virtually nothing and people will have great, great healthcare,” he said. “And when I say people, I mean by the millions and millions.

“We’ve been hearing about the disaster of Obamacare for so long. It has been a nightmare.”

The ACA provides insurance to millions of Americans mostly by expanding the number of people eligible for Medicaid, the government health plan for the poor, and providing subsidies for individuals and small businesses to buy insurance.

Going without health insurance in the United States, which has the world’s most expensive health system, can be financially ruinous.

Almost half of Americans get health insurance through their employer. Those who do not can buy insurance through regulated, subsidized online marketplaces.

The Trump administration has targeted those marketplaces with destabilizing rule changes, while congressional Republicans have attempted on several occasions – so far without success – to pass legislation to undo the 2010 health law.

Democrats swiftly condemned Trump on Thursday for what they said was a deliberate effort to undermine the ACA.

“Having failed to repeal the law in Congress, the president is sabotaging the system, using a wrecking ball to single-handedly rip apart our healthcare system,” Chuck Schumer, the Senate minority leader, said in a statement. “If the system deteriorates, make no mistake about it, the blame will fall squarely on the president’s back.”

The Trump administration has taken other steps to derail the ACA: cutting the sign-up period for insurance by half; shutting down for maintenance the website people use to sign up for health insurance; slashing funding for outreach; and repeatedly threatening to end subsidies to insurance companies who cover the poor.

Trump acknowledged efforts to repeal and replace the ACA through legislation had been thwarted not just by Democrats but “a very small, frankly, handful of Republicans”. He said: “We will fix that.”

In private meetings, Democrats have sought to persuade Trump to take repeal off the table and work across the aisle to improve the ACA. Democrats hoped to use must-pass spending bills as opportunities to pass legislation that would stabilize the insurance markets.

But Trump’s order on Thursday signaled his commitment to tearing apart his predecessor’s signature legislative accomplishment.

What the order changes

The order – whose full text has not yet been released – allows businesses to buy “association health plans”. In theory, that would let them band together to buy the type of coverage big employers provide.

Small companies usually have difficulty affording insurance for their employees. Because fewer people bear the costs when one person gets sick, their insurance plans can be expensive. The Trump administration’s new executive order focuses on those small businesses.

However, experts expect the plans will be unlike insurance provided by big firms in a number of ways. For consumers, they will have skimpier benefits, and will not have the consumer protections set out by the ACA. That will make costs lower, but it also means fewer benefits.

“When they have health problems, they may get very nasty surprises,” said Linda Blumberg, an expert at the Urban Institute. “It can be very problematic.”

Fewer regulations

At the same time, because association health plans are cheaper, healthy people are more likely to enroll, making regulated health plans more expensive. Before the order, small businesses would be required to buy health insurance through exchanges, which are highly regulated and include a standard set of benefits such as prescription drug coverage and maternity care.

Association health plans will not be required to carry those benefits. In addition, the federal government has few resources, which makes oversight weak. In the past, that led to fraud and insolvency, which meant patients were left “high and dry”.

“If something is marketed to them as health insurance that’s as good as something from a large employer, and it’s hard for them to figure out what’s in there, then they buy it and figure out their chemotherapy isn’t covered once they get cancer mid-year,” Blumberg said.

Providing cheaper, if poorer quality plans, also has a systemic effect. When healthy people buy cheaper, skimpier plans, fewer people overall share the risk of one person getting sick. That means more sick people in regulated plans, which drives up cost.

“One of the central goals of the ACA was to spread risk, so they have healthcare when they need it,” said Blumberg. “This is going in the absolute opposite direction.”

  • This article was amended on 13 October 2017 to correct a word misheard in a quote from Linda Blumberg.
This article titled "Trump accused of sabotage after signing executive order to weaken Obamacare" was written by Sabrina Siddiqui and Jessica Glenza in Washington, for on Thursday 12 October 2017 05.32pm

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