Can Trump make Obamacare implode? - Insurance News | InsuranceNewsNet

InsuranceNewsNet — Your Industry. One Source.™

Sign in
  • Subscribe
  • About
  • Advertise
  • Contact
Home Now reading Newswires
Topics
    • Advisor News
    • Annuity Index
    • Annuity News
    • Companies
    • Earnings
    • Fiduciary
    • From the Field: Expert Insights
    • Health/Employee Benefits
    • Insurance & Financial Fraud
    • INN Magazine
    • Insiders Only
    • Life Insurance News
    • Newswires
    • Property and Casualty
    • Regulation News
    • Sponsored Articles
    • Washington Wire
    • Videos
    • ———
    • About
    • Meet our Editorial Staff
    • Advertise
    • Contact
    • Newsletters
  • Exclusives
  • NewsWires
  • Magazine
  • Newsletters
Sign in or register to be an INNsider.
  • AdvisorNews
  • Annuity News
  • Companies
  • Earnings
  • Fiduciary
  • Health/Employee Benefits
  • Insurance & Financial Fraud
  • INN Exclusives
  • INN Magazine
  • Insurtech
  • Life Insurance News
  • Newswires
  • Property and Casualty
  • Regulation News
  • Sponsored Articles
  • Video
  • Washington Wire
  • Life Insurance
  • Annuities
  • Advisor
  • Health/Benefits
  • Property & Casualty
  • Insurtech
  • About
  • Advertise
  • Contact
  • Editorial Staff

Get Social

  • Facebook
  • X
  • LinkedIn
Newswires
Newswires RSS Get our newsletter
Order Prints
July 30, 2017 Newswires
Share
Share
Post
Email

Can Trump make Obamacare implode?

Capital (Annapolis, MD)

WASHINGTON - President Donald Trump has said he wants to "let Obamacare implode" as a way to force Democrats to negotiate a deal over replacing the Affordable Care Act. How real is that threat, and how imminent? Here are some key questions and answers.

Can the Trump administration cause the health care law to collapse?

Not entirely, and not all at once, but the administration does have the ability to cause some amount of chaos in certain parts of the health care system.

Causing chaos in health coverage sounds bad. Why would Trump want to do that?

At least some administration officials think that if more people have trouble getting coverage, pressure will increase on Congress to either repeal the Affordable Care Act or make big changes in it. So far, Republicans have not been able to agree on a plan to do that.

Which parts of the system are most vulnerable?

Two different government programs help provide coverage for low- and middle-income working-age people and children. One is the marketplace for individual health care plans, which the Affordable Care Act created. The other is Medicaid, which the law expanded.

There's not much the administration can do to undermine Medicaid without getting a law through Congress, at least in the short term. It's a program jointly run by the states and the federal government, and the states have a lot of authority over what is covered and who benefits.

The individual marketplace is more at risk.

Which of those involves more people?

Medicaid is far larger. Roughly 75 million Americans are covered by Medicaid and the related Children's Health Insurance Program. That's more than 1 in 5 Americans.

About 10 million people have purchased coverage on the Obamacare marketplaces in 2017. Most working-age Americans, it's worth noting, get health insurance through their jobs.

Under the law, low- and middle-income people buying health plans on the marketplaces can get government subsidies to make premiums more affordable.

What could the administration do to cause the individual market to implode, as Trump says?

Think of this in two buckets. Some actions the administration could take would passively allow the marketplaces to become less stable. That would cause a slow erosion.

There are also steps they could take to sabotage the markets, which could cause trouble much faster.

What would cause slow erosion?

Officials could stop marketing and outreach efforts that encourage people to sign up during open enrollment periods. They could refuse to enforce the requirement that people buy insurance or pay a tax - a step that officials already have said they will take. And they could stop trying to keep insurance companies in the markets.

None of those actions would cause the markets to collapse overnight, but they would destabilize them over time by driving out healthy people, which causes costs to rise, which in turn drives out more healthy people. That's what's known as a death spiral, and it could happen at least in some parts of the country eventually.

What would cause harm quickly?

The biggest issue involves money that has the bureaucratic-sounding name of cost-sharing reductions.

Basically, the government tells insurers that they need to hold down the insurance deductibles and co-payments that they charge low-income people.

That costs the insurers money. To make the insurers whole, the government is supposed to reimburse them.

Every month, Washington sends insurers checks that total close to $600 million. And every month since he took office, Trump has raised the possibility that he might cut the money off, although he hasn't actually done so.

If Trump cut off the payments, what would insurers do?

Some insurers would raise premiums to cover the higher costs, as several have already said they plan to do. Others would probably pull out entirely and stop selling insurance in the individual market.

When's the next deadline?

In late August.

Could Congress stop Trump from doing that?

Yes, and it's quite possible that they will since many Republican members of Congress fear that chaos in the markets would be bad for their constituents, not to mention their political futures.

david.lauter@latimes.com

Credit: By David Lauter; Noam N. Levey - Washington Bureau - david.lauter@latimes.com

Caption: Protesters carry signs at a health care rally Saturday in front of Trump Tower in New York.

BRYAN R. SMITH/Getty-AFP

Older

Lima rally calls for more access to health care

Newer

EDITORIAL: New health benefits among major K-12 reforms of 2017

Advisor News

  • Navigating client communication in a digital age
  • Can your advisory firm survive without you?
  • I started using AI, but what now?
  • How to support an entrepreneur client with multiple businesses
  • Could a narrower focus help grow your practice?
More Advisor News

Annuity News

  • Best’s Market Segment Report: US Property/Casualty Farm Bureau Insurers Posted First Underwriting Gain Since 2021; Life/Annuity Counterparts’ Results Remain Steady
  • Legacy Marketing Group® and Malibu Life Launch Two New Fixed Indexed Annuities for Performance-Driven Income Planning
  • Changing client priorities are reshaping annuity conversations
  • Solen Software Group Acquires Cooperative Technologies, Provider of 1035 Exchange and Annuity Replacement Software
  • MassMutual Expands Lending Options With New Secured Credit Line
More Annuity News

Health/Employee Benefits News

  • NJ DEPARTMENT OF BANKING AND INSURANCE RECOUPS MORE THAN $10.5 MILLION FOR AUTO INSURANCE CONSUMERS OVERCHARGED BY GEICO
  • Covly Launches to Deliver Clear, Personalized Health Coverage Guidance
  • Oklahoma healthcare agency boasts low payment error rate
  • Charles Sauer: Medicare’s bad incentives are costing taxpayers billions
  • 87,000 Iowans face Medicare Advantage plan cancellations. Here's what to know
More Health/Employee Benefits News

Life Insurance News

  • Americans Worry They Can’t Afford Health Care in Retirement, Allianz Life Study Finds
  • Solen Software Group Acquires Cooperative Technologies, Provider of 1035 Exchange and Annuity Replacement Software
  • Virginia orders Atlantic Coast Life to halt new business Nov. 1
  • AM Best Affirms Credit Ratings of China Taiping Insurance (Singapore) Pte. Ltd.
  • AM Best Upgrades Credit Ratings of Fidelity Life Association, A Legal Reserve Life Insurance Company; Affirms Credit Ratings of Industrial Alliance Insurance and Financial Services Inc. and Its Life/Health Subsidiaries
Sponsor
More Life Insurance News

NEWS INSIDE

  • Companies
  • Earnings
  • Economic News
  • INN Magazine
  • Insurtech News
  • Newswires Feed
  • Regulation News
  • Washington Wire
  • Videos

FEATURED OFFERS

Press Releases

  • Benefits Studio Launches to Fill the Missing Middle of Benefits Navigation at $49/mo
  • Lauren Sinnott Named to Ragan’s Top Women in Marketing Awards, Class of 2026 
More Press Releases > Add Your Press Release >

How to Write For InsuranceNewsNet

Find out how you can submit content for publishing on our website.
View Guidelines

Topics

  • Advisor News
  • Annuity Index
  • Annuity News
  • Companies
  • Earnings
  • Fiduciary
  • From the Field: Expert Insights
  • Health/Employee Benefits
  • Insurance & Financial Fraud
  • INN Magazine
  • Insiders Only
  • Life Insurance News
  • Newswires
  • Property and Casualty
  • Regulation News
  • Sponsored Articles
  • Washington Wire
  • Videos
  • ———
  • About
  • Meet our Editorial Staff
  • Advertise
  • Contact
  • Newsletters

Top Sections

  • AdvisorNews
  • Annuity News
  • Health/Employee Benefits News
  • InsuranceNewsNet Magazine
  • Life Insurance News
  • Property and Casualty News
  • Washington Wire

Our Company

  • About
  • Advertise
  • Contact
  • Meet our Editorial Staff
  • Magazine Subscription
  • Write for INN

Sign up for our FREE e-Newsletter!

Get breaking news, exclusive stories, and money- making insights straight into your inbox.

select Newsletter Options
Facebook Linkedin Twitter
© 2026 InsuranceNewsNet.com, Inc. All rights reserved.
  • Terms & Conditions
  • Privacy Policy
  • InsuranceNewsNet Magazine

Sign in with your Insider Pro Account

Not registered? Become an Insider Pro.