The Trump administration moved Thursday to further loosen regulations on health insurance plans, taking a modest step toward the president’s oft-stated goal of rolling back requirements imposed by the Affordable Care Act that many Republicans blame for high premiums.
The proposed rules posted Thursday by the Department of Labor would make it easier for self-employed Americans, small businesses and others to band together to get health insurance through what are called association health plans.
These plans, long favored by business trade groups, could not turn away sick consumers or charge more to people with preexisting medical conditions, two popular protections enacted in the 2010 healthcare law, often called Obamacare.
But the plans would likely be able to skirt another key consumer protection in the current law that requires health plans sold directly to consumers to offer a basic set of health benefits, including prescription drugs, maternity care and mental health and substance abuse services.
Fewer required benefits should make health plans more affordable, argue Trump administration officials and Republican lawmakers who support deregulation.
“The goal of the rule-making is to expand access to affordable health coverage, especially among small employers and self-employed individuals, by removing undue restrictions,” the Department of Labor noted in the proposed regulation.
That was welcomed by industry groups such as the National Retail Federation.
“Main Street retailers need more affordable healthcare options and a level playing field with larger companies that are better positioned to negotiate for lower insurance costs,” said David French, federation senior vice president.
Most large employers are already exempt from the health law’s benefit mandates.
But many patient groups and consumer advocates — who are already alarmed by Trump administration efforts to undermine the 2010 health law — fear that less comprehensive health plans will leave Americans without vital protections.
“The rule proposed today will almost certainly result in more people facing financial distress when an unexpected health crisis happens and they discover their association health plan coverage is inadequate,” said Chris Hansen, president of the advocacy arm of the American Cancer Society.
By allowing healthier Americans to buy plans that don’t cover expensive medications or other medical benefits, these plans also risk driving up costs for sick patients who need the more extensive coverage.
For example, proposals last year by congressional Republicans to allow health plans to offer slimmed down benefits would have made coverage unaffordable for many consumers with preexisting medical conditions, according to analyses by the nonpartisan Congressional Budget Office.
It is unclear how many of these association health plans would open and whether states would be able to impose their own benefit requirements on the plans to assure that they offer a full set of benefits.
Some states that have aggressively implemented the Affordable Care Act, such as California, would likely try to retain the consumer protections enacted through the 2010 law.
In other places, however, skimpier health plans might become more widespread. And the Trump administration has signaled its intent to push further deregulation.
Federal agencies are currently working on other rules to allow more widespread sale of short-term health plans that would be allowed to turn away sick patients altogether.
The proposed rules on association health plans are open for public comment for the next 60 days, after which they may be adjusted before becoming final.