Trump Takes Final Shot At Obamacare Exchanges

On his way out of the White House, President Donald Trump is taking one last swipe at the Affordable Care Act, proposing to allow states to opt out of the Obamacare exchanges where millions of Americans enroll in health insurance plans.

If states choose this potential new option, residents would no longer have access to a one-stop shop for health insurance. Instead, they would have to find their way to private insurance brokers or individual carriers.

They also wouldn't have access to impartial advisers, so-called navigators, to assist them in making their choices.

The rule, proposed on Thanksgiving Eve, is one of the last attempts by the Trump administration to undo the ACA. Trump failed to kill President Barack Obama's signature law in Congress, but is still attempting to do so in a case heard by the U.S. Supreme Court last month. Through administrative acts, Trump has been able to chip away at the law.

The federal Centers for Medicare & Medicaid Services (CMS) said the proposed rule, which still must go through a public comment period, would increase enrollment in health insurance and decrease premiums by encouraging competition and innovation.

Critics complain the Trump administration is trying to rush the proposed rule before Trump leaves office Jan. 20. By accepting public comments only until Dec. 30, there's an increased likelihood that the administration could adopt a final rule before President-elect Joe Biden is inaugurated. In the past, the process for rules like this one has taken three to four months, according to an analysis by the Center on Budget and Policy Priorities, a liberal think tank in Washington, D.C.

The heart of the proposal is modeled after a Georgia plan CMS approved last month that is almost certain to be challenged in court. The Trump administration wants to give all states the opportunity to follow Georgia's path.

Critics insist the new rule would actually do the opposite of what CMS claims, diminishing enrollment and increasing customer costs while raising the likelihood that individuals and families end up in substandard plans that leave them with gaps in coverage in the event of illness or injury.

"Allowing states to privatize the ACA by eliminating any public marketplace would likely reduce overall enrollment and would surely lead to massive disruption and consumer confusion," said Joel Ario, managing director with the consulting firm Manatt Health and former director of the Office of Health Insurance Exchanges in Obama's Department of Health and Human Services.

The Georgia Department of Community Health, whose plan is the model for CMS' proposed rule, claimed in an email that the change will lead to "improved access, affordability and quality of healthcare statewide."

Opponents insist that under the new plan, Georgians will end up losing coverage and find health insurance less affordable and comprehensive.

While analysts say the incoming Biden administration could block the national rule, "it'll distract from other policies and guidelines" at a time when the administration should be giving full attention to the COVID-19 pandemic, said Yvette Fontenot, a former Obama health adviser.

Fourteen states and Washington, D.C., operate their own health insurance exchanges. The rest of the states use the federal site, Healthcare.gov, customized to the market in each state, or partner with Healthcare.gov. The Trump proposal would give all states the opportunity to choose the new option.

This year, nearly 11.5 million Americans signed up for insurance on the exchanges, which provide a side-by-side comparison of nearly all the ACA-compliant plans offered in each state. Consumers also can find out about federal subsidies they might receive.

All the exchanges used to provide navigators and engage in marketing to boost enrollment, especially in minority communities. But in 2018 the Trump administration eliminated almost all funding for Healthcare.gov navigators and marketing, so now only state-based exchanges have money for those functions.

The exchanges also determine eligibility for Medicaid, the public health plan for the poor. Consumers who qualify are enrolled or passed on to a state website where they can sign up.

The Trump option would strip down the exchanges to a basic listing of insurance plans and perhaps contact information for private brokers or insurance carriers. There would be no comparison of plans, no enrollment option and no guidance.

Direct enrollment is already permitted in states that use Healthcare.gov. According to CMS, one-third of people enrolling in individual commercial plans (as opposed to employer-sponsored health plans) do so through direct enrollment. Most enrollees prefer to use the exchanges.

Jessica Altman, insurance commissioner for Pennsylvania, which launched a state-based exchange this year after using Healthcare.gov since 2014, said she was certain her state would not choose the direct enrollment option.

"One of the core values of the ACA is making sure people are given the opportunity to truly shop and see all the plans with fair, accurate and impartial information," she said, which would not be the case with direct enrollment entities.

Unlike the navigators, Altman said, brokers would have an incentive to push consumers toward policies that offer the greatest commissions.

She is particularly concerned that brokers seeking high commissions would point consumers to short-term plans, which usually don't offer the comprehensive coverage of ACA-compliant plans, such as protections for preexisting conditions. Such plans, which the Trump administration made legal, often leave patients with huge bills for services.

Medicaid-eligible people are likely to be especially susceptible to that pressure, Altman said.