President Donald Trump today signed an executive order that officially puts his administration’s weight behind the idea of letting small employers join together to form interstate health coverage purchasing groups.
Another provision could eliminate the current 90-day cap on the duration of short-term medical insurance coverage from a single issuer.
A third could lead to changes in the rules governing employer-sponsored health reimbursement arrangements.
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Trump signed the order during a brief ceremony in the Oval Office.
Health policy watchers have been discussing what were said to be leaked copies of order drafts, and speculating about what might be in the final version, for weeks. Trump himself tweeted that he expected the order to include an association health plan provision.
The White House today posted a copy of the order here, and a summary of the order here.
The White House streamed the signing ceremony for the order live on the web. A recording of the video is available here.
Trump said at the ceremony that the order will direct the heads of the U.S. Treasury Department, the U.S. Department of Labor and the U.S. Department of Health and Human Services to take steps to increase competition and choices in the health care market, and to promote the creation of new low-cost, high-quality health care options for consumers and employers.
“They will have so many options,” Trump said. “This will cost the U.S. government virtually nothing.”
Sen. Rand Paul, R-Ky., a senator who has argued in the past that some of the major Affordable Care Act change bills debated in the Senate were too weak for him to support, appeared at the signing ceremony to support the order.
Paul called the association health plan provision in the order “the biggest free-market reform in a generation.”
“This reform, if it works and goes as planned, will let millions of people get insurance across state lines at an inexpensive price,” Paul said.
Trump cited Paul’s presence at the ceremony as evidence that the executive order will make the situation better. “When you get Rand Paul on your side, it has to be positive,” Trump said.
Here’s a look at three facts about the order of possible interest to agents and brokers.
Sen. Rand Paul, R-Ky. (Photo: White House)
1. The order mostly spells out general goals for federal agencies.
In the order, Trump states that his administration will focus on improving regulations in three areas: fostering the creation of interstate association health plans; easing the rules that apply to short-term medical insurance plans; and expanding access to health reimbursement arrangements.
Trump says in the order, for example, that he wants small employers to be able to use interstate association health plans, or health insurance purchasing groups, to be able to enjoy the same benefits that large employers now enjoy when those large employers self-insure.
Trump does not say in the order exactly what he thinks the association health plans would look like, or how he expects the rules governing short-term medical insurance or health reimbursement arrangements to change.
Alexander Acosta (Photo: White House)
2. Trump does give some hints about what he and others in his administration dislike about the current regulations and how the regulations might change.
In the order, Trump does offer some specific advice for his cabinet secretaries.
Interstate Association Health Plans
Trump encourages Secretary of Labor Alexander Acosta to look for ways to support access to interstate association health plans by:
Loosening the rules for deciding what kind of an organization qualifies as an “employer” under Section 3(5) of the Employee Retirement Income Security Act of 1974 (ERISA).
Letting employers join together in health benefits purchasing groups if they’re in the same industry, or if they’re in the same area of the country.
Short-Term Medical Insurance
In a section on short-term medical insurance, Trump talks mainly about short-term medical insurance policy duration rules.
Until recently, state insurance regulators decided how long a short-term medical insurance policy could last. In some states, a policy could last almost a year.