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Trump tweaks HHS, CMS regulations on Obamacare, ACA healthcare waivers

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Doanld Trump Barack Obama
Donald Trump and Barack
Obama.

Win
McNamee


  • The Trump administration released new rules around the use of
    Obamacare’s state innovation waivers on Monday.
  • The Department of Health and Human Services and Centers of
    Medicare and Medicaid Services argued that the regulations would
    help states create rules that would drive down costs and provide
    flexibility for consumers.
  • The changes appear to be part of the Trump administration’s
    ongoing campaign to
    reshape the healthcare system
    without repealing Obamacare.

The Trump administration on Monday released new rules that could
allow states to offer less generous health insurance plans
through their Obamacare markets to drive down costs for
consumers. But health policy experts warned that the changes
could help undermine some of Obamacare’s key protections.

The Department of Health and Human Services and Centers for
Medicare and Medicare Services
issued new guidance
on the use of the Affordable Care Act’s

Section 1332 waivers
 that would give state governments
more flexibility in offering plans that do not comply with the
ACA’s basic coverage requirements.

According to health policy experts, the guidance would make it
easier for states to undermine key parts of Obamacare and weaken
protections for sicker Americans.

Since the failure of the GOP’s Obamacare repeal and replace
efforts in 2017, the waivers have become a key approach in the
Trump administration’s attempts to roll back parts of the ACA.

Now, states will have a clearer sense of how they can take
the lead on making available more insurance options, within the
bounds of the Affordable Care Act, that are fiscally sustainable,
private sector-driven, and consumer-friendly,” HHS Secretary
Alex Azar said in a statement.

Larry Levitt, senior vice president at the nonpartisan Kaiser
Family Foundation, said the new waiver guidance is further
evidence that the Trump administration is attempting to chip away
at the ACA.

Republicans failed to repeal and replace the ACA last
year,” Levitt tweeted. “This new guidance from the Trump
administration on state waivers continues a theme of trying
instead to make end-runs around the ACA’s rules.”

Here’s a rundown of some of the key changes in the waiver
guidance:

  • Preference for private plans: The Obama
    administration designed the waivers with the intention of
    states attempting their own version of a public option, or
    government-provided healthcare plan. The new guidance makes it
    clear that the Trump administration favors plans that use
    private insurance plans, rather than public plans like Medicaid
    buy-in.
  • Allows the expanded use of non-ACA compliant
    plans:
    Currently, insurance plans offered on the
    Obamacare exchanges — where people without coverage from a job
    or a government program like Medicare can get their coverage —
    must abide by a stringent set of rules. The plans must
    cover people
    with preexisting conditions
    , must charge those people the
    same rate as healthier people, and cover 10 essential health
    benefits (basic types of care like prescription drugs and
    maternity care).

    • The new wavier rules would allow states to set up
      programs that offer plans that don’t abide by the ACA rules
      as long as there is one ACA-compliant option. The
      non-compliant plans would likely be cheaper, but also would
      provide fewer protections in the event people enrolled in
      the plan get sick.
    • Dan Meuse, a health
      policy expert
      at Princeton University, tweeted that
      the guidance “suggests that states will be encouraged to
      expand plans that don’t cover preexisting conditions — even
      using subsidies to pay for them — as long as one
      comprehensive plan is offered (regardless of cost).”
  • Expand the definition of what counts as
    coverage:
    Currently Section 1332 wavier requests must
    show that the same number of people will be covered when the
    waiver is implemented as prior to implementation. As it stands
    now, only people who have a plan that covers the ACA’s
    essentials health benefits (EHBs) count towards that coverage
    number. The new guidance would expand the definition of who is
    covered to include people on short-term, limited duration plans
    that do not cover EHBs as long as they had the chance to buy a
    compliant plan.
  • Would allow people to use subsidies to purchase
    non-ACA compliant plans:
    Currently, ACA premium
    subsidies can only be used on plans that comply with all ACA
    rules. The new guidance could allow states to let people use
    subsidies to buy less generous plans like
    short-term, limited-duration health insurance
    .
  • States can enact a wavier without legislative
    approval:
    Previously, any waiver had to be adopted by
    the state’s legislature for the federal government to approve
    the waiver. Now, in some circumstances an executive order from
    the governor can be enough.
  • Changes the name of the waivers:
    Previously, Section 1332 waivers were known as “State
    Innovation Waivers.” The Trump administration renamed them
    “State Relief and Empowerment Waivers.”

Only eight Section 1332 waivers have been approved by the federal
government, and most have focused on supporting the current
Obamacare market through reinsurance programs — rather than
offering alternative plans. But Levitt said the new rules could
change that.

It’s hard to overstate how much flexibility states will
have under the Trump administration’s new guidance for ACA
waivers,” he said. “This will likely widen the gap between red
states and blue states for access, affordability, regulation, and
protections for pre-existing conditions.”


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