The White House Council of Economic Advisers (CEA) estimated that 13 million Americans will have increased access to health care due to President Donald Trump’s executive action, according to a report released recently.
The CEA estimated that millions of Americans will have new health insurance access that is better tailored to their healthcare needs that were previously unavailable due to high healthcare prices and overregulation. The council attributed much of the increase to the president’s reforms to expand short-term limited-duration health insurance plans, association health plans (AHPs), and health reimbursement accounts (HRAs).
Short-term plans cost less than Obamacare plans because federal statute does not require the insurance plans to comply with all of Obamacare’s onerous insurance regulations; thus, they serve as a good alternative for many younger and healthier Americans.
The Trump administration’s rule allowed Americans to purchase short-term plans for up to 364 days and renew the plans for up to three years. The Barack Obama administration curbed these rules to encourage Americans to purchase Obamacare.
The CEA said that short-term plans could be half as expensive as Obamacare-compliant plans.
“Though these plans are more limited in coverage than the ACA-compliant insurance plans, they are priced at up to 60 percent less than the unsubsidized premium cost of ACA exchange plans and give consumers more insurance protection than being uninsured,” the council wrote.
AHPs allow small businesses to join together and benefit from the regulatory advantages that many large companies experience under health insurance rules. AHPs can serve employees in a city, county, state, or a particular industry across the nation.
The CEA wrote that up to five million Americans will likely enroll in either AHPs or short-term plans, with one million Americans likely to get newly insured as the result of the short-term plan expansion.
The CEA wrote:
As a result of STDLI and AHP rules, the CBO and the U.S. Congress’s Joint Committee on Taxation estimates that over the next decade, roughly 5 million more people are projected to be enrolled in AHPs or short-term plans. Of this increase, almost 80 percent constitute individuals who would otherwise have purchased coverage in the small-group or nongroup markets. The remaining 20 percent (roughly 1 million people) are made up of individuals who are projected to be newly insured as a result of the rules.
The council wrote that roughly one million Americans will save money on their health insurance premiums by switching to short-term health insurance policies. It added that the savings could exceed 50 percent compared to an Obamacare-compliant plan.
The Trump administration also expanded a rule that would allow employers to offer their employees a tax-deferred account to purchase their own health insurance. HRAs enable American workers to maintain their health insurance coverage even if they were to leave their job.
The CEA said that up to 11 million workers will receive their more personally tailored health insurance coverage under HRAs.
“The Treasury Department estimated that 800,000 employers are expected to provide HRAs after being fully ramped up. In addition, it is estimated that there will be a reduction in the number of uninsured by 800,000 by 2029,” the council wrote. “From these employers’ HRA contributions, it is expected that firms will cover more than 11 million employees with individual health insurance by 2029.”
During his State of the Union address in February, President Trump said he has worked to lower health insurance premiums for all Americans.
“Before I took office, health insurance premiums had more than doubled in just five years. I moved quickly to provide affordable alternatives. Our new plans are up to 60 percent less expensive — and better,” the president said, touting the low cost of short-term plans.
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