Some health care experts offer warnings about Trump’s new proposal
The reason companies don't pursue it is a "a chicken and an egg problem" -- companies need to set up a network of providers in a new market and they initially lack the market share to effectively negotiate good prices with those providers, said
"To appeal to new customers, you have to offer a good provider network at a reasonable price," she said. "To get providers to agree to contract with you, you have to demonstrate to them that you have the enrollment to make it worth their while. So hence the problem."
The ACA does allow for states to come together and form compacts to sell insurance across state lines but those compacts and the policies sold under them have to be approved by the
Trump's idea might make that easier, and it was a provision included in some of the ACA replacement bills that did not pass, along with the idea of allowing great group purchases through the association health plans. Those plans would be exempt from many of the protections under the ACA, such as having to cover people with pre-existing conditions or charging sick people more for coverage, or providing certain coverage, such as maternity care, said
"It essentially is the functional equivalent to repealing the Affordable Care Act," she said. "It is just doing it administratively as opposed to having
One way to actually implement Trump's order would be to move regulatory authority of these plans away from the closer scrutiny of state regulators and put them under the federal Employee Retirement Income Security Act or ERISA that governs large employer self-insured plans, Kofman said. That would put them under the
In one two-year period, for example, state regulators shut down 144 scams compared to three by the federal department, Kofman said.
Those association health plans, even when formed by legitimate groups for the purpose of offering cheaper health insurance to their members, are much riskier, said
States have guaranteed funds to protect consumers whose insurance companies go belly up but those funds would not protect people covered by these plans, she said.
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