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Trump acting solo: What you need to know about changes to the health law

Julie Rovner, Mary Agnes Carey and Julie Appleby, Kaiser Health News on

Published in Health & Fitness

WASHINGTON--Apparently frustrated by Congress' inability to "repeal and replace" the Affordable Care Act, President Donald Trump this week decided to take matters into his own hands.

Late Thursday evening, the White House announced it would cease key payments to insurers. Earlier on Thursday, Trump signed an executive order aimed at giving people who buy their own insurance easier access to different types of health plans that were limited under the ACA rules set by the Obama administration.

"This is promoting health care choice and competition all across the United States," Trump said at the signing ceremony. "This is going to be something that millions and millions of people will be signing up for, and they're going to be very happy."

The subsidy payments, known as "cost-sharing reductions," are payments to insurers to reimburse them for discounts they give policyholders with incomes under 250 percent of the federal poverty line, or about $30,000 in income a year for an individual. Those discounts shield these lower-income customers from out-of-pocket expenses, such as deductibles or copayments. These subsidies have been the subject of a lawsuit that is ongoing.

The cost-sharing reductions are separate from the tax credit subsidies that help millions of people pay their premiums. Those are not affected by Trump's decision.

Some of Trump's actions could have an immediate effect on the enrollment for 2018 ACA coverage that starts Nov. 1. Here are five things you should know.

1. The executive order does not make any immediate changes.

Technically, Trump ordered the departments of Labor, Health and Human Services and Treasury within 60 days to "consider proposing regulations or revising guidance, to the extent permitted by law," on several different options for expanding the types of plans individuals and small businesses could purchase. Among his suggestions to the department are broadening rules to allow more small employers and other groups to form what are known as "association health plans" and to sell low-cost, short-term insurance. There is no guarantee, however, that any of these plans will be forthcoming. In any case, the process to make them available could take months.

2. The cost-sharing reduction changes are immediate but might not affect the people you expect.

Cutting off payments to insurers for the out-of-pocket discounts they provide to moderate-income policyholders does not mean those people will no longer get help. The law, and insurance company contracts with the federal government, require those discounts be granted.

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