Health and Science

Trump's new health-care order 'might be great PR' but 'pretty hollow': Obamacare critic

Key Points
  • An Obamacare critic said President Trump's new executive health-care order might be "great PR" on the heels of failing to repeal Obamacare, but is "pretty hollow" when it comes to details.
  • The order leaves "daunting" details about what should be done to change health-care rules to administration agencies.
  • The order also could offer the "illusion" of lower health insurance costs to many Americans.
President Trump signs executive order on health care

A longtime critic of Obamacare said President Donald Trump's new executive order on health care is "pretty hollow," and offers an "illusion of lower health costs" for many people.

Robert Laszewski, who is a veteran health policy consultant, also said Trump's order could reverse the "very important" benefit from Obamacare getting rid of barriers that for years kept people with health conditions out of insurance plans or charged them much higher prices for coverage.

Trump's order "might be great PR for a White House desperate to be seen as acting on Obamacare in the wake of failed Republican Congressional attempts" to repeal and replace the Affordable Care Act, Laszewski wrote in a note to clients Thursday.

"But it is a pretty hollow order since he is only ordering the relevant cabinet departments to consider issuing new regulations," wrote Laszewski, president of Health Policy and Strategy Associates.

"The details he leaves to his administration with this executive order are daunting," he wrote.

Laszewski noted that Trump's order proposes loosening rules regulating so-called association health plans to make it easier for small businesses to band together, across state lines, and buy health coverage for their workers.

"We have had bills pending in the Congress off and on for more than 20 years that would have created association health plans," Laszewski wrote.

"In those years, Republican Congress' could not pass the legislation. Now, he thinks what we all thought had to be done through legislation is something his administration can suddenly do via regulation?"

Laszewski also said that "Any such controversial regulations will surely be challenged by state-run insurance exchanges and state insurance regulators who will certainly be harmed by association health insurance pools that will attract healthy people from existing state-run pools."

He called association health plan ideas "nothing more than rearranging the deck chairs on the Titanic, because they only create a new risk pool designed to attract the youngest and healthiest out of the current state-run insurance pools."

"Every healthy person that leaves a state individual or small employer risk pool because of them means that the cost of the existing state-run pool has to go up by that much," Laszewski wrote.

"Overall, there is no reduction in costs, only a shifting of costs from the healthiest to the sickest."

Laszewski said a key accomplishment of Obamacare had been the creation of a single risk pool, in which the costs of sicker customers are offset by the premiums paid by healthier people.

"This order would reverse that," Laszewski wrote.

"Instead of actually decreasing the cost of health insurance, the Trump executive order would just offer the market the illusion of lower costs by charging the healthier less but the sickest more."

Laszeswski said that Trump's proposal to expand the duration for short-term health insurance plans "can likely be done."

The Obama administration limited the duration of a short-term health plan to three months, cutting it from 12 months.

Short-term health plans are less expensive than individual health plans sold on Obamacare marketplaces, and also offer fewer comprehensive medical benefits than Obamacare plans.

Short-term plans are not compliant with benefits standards established by the Affordable Care Act. As a result, enrollment in them does not exempt an individual from the ACA's requirement that most Americans have health coverage or face a tax penalty.

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