Last year, President Trump signed an executive order aimed at bringing three key healthcare initiatives into action– short-term, limited-duration health plans; health reimbursement arrangements (HRAs); and association health plans (AHPs).
Flash forward to last Tuesday, The Center for Medicare & Medicaid Services (CMS) announced a reduction in funds allocated toward the ACA healthcare navigator. Rather, CMS is focusing on “providing more tailored opportunities for consumers,” in the private sector. With declining enrollment, 28 million people still uninsured, and increased premiums each year, it’s no wonder CMS is focusing on expanding alternatives.
In the face of increasingly limited options, these three initiatives go a long way toward bringing consumer freedom back to healthcare.
Under the ACA, short-term health insurance (STHI) plans were capped at 90 days and did not qualify as health coverage under the individual mandate. President Trump’s proposed regulations would expand STHIs to 364 days of coverage. Up to a year of coverage is a significant alternative– especially for those who may be between jobs, self-employed, or simply unable to afford premiums in the ACA exchanges.
It’s true that short term plans do not have to meet ACA standards– they aren’t required to provide maternity, mental health, or prescription drug coverage. However, they do provide a much needed alternative for those seeking short-term basic or catastrophic coverage. This includes those who miss open enrollment, since you can enroll in STHIs at any time.
Increasing consumer purchasing power through health reimbursement arrangements (HRAs) is also on the agenda. These new regulations enable companies of all sizes to offer HRAs– not just small companies as was the case under the ACA.
For employees interested in offsetting their own own-of-pocket expenses, HRAs can be an affordable alternative to group health plans, or a helpful add-on. They allow employees to access employer-sponsored funds to pay for medical expenses, including health insurance premiums. Increasing consumer choice while cutting costs makes increasing HRAs a no-brainer.
These regulatory consumer benefits aren’t just limited to employees. The Department of Labor recently expanded association health plans (AHPs). For small businesses or the self-employed, AHP’s allow employers to pool together their purchasing power to negotiate lower health insurance costs. Considering only 29% of small businesses offered coverage in 2016, AHP’s make it easier for employers to provide affordable coverage options while being mindful of their own bottom line.
While President Trump has been unsuccessful in repealing the ACA, these regulatory changes represent a huge step toward bolstering consumer freedom in our healthcare system.