On Friday evening, Jan. 20, just hours after taking the oath of office, President Donald J. Trump signed an executive order, one of his first, giving federal agencies the authority to work within their scope of authority to undo unspecified regulations pertaining to the Affordable Care Act (ACA) of 2010. Exactly how such authority might be used, and under what circumstances and to what extent, was left extremely unclear; but the order did signal Pres. Trump’s previously stated intentions to help to overturn the ACA, though only the U.S. Congress can actually fully repeal the legislation.
At 9:15 p.m. eastern time on Friday, CNN published the full text of the executive order. The order begins by stating that “It is the policy of my Administration to seek the prompt repeal of the Patient Protection and Affordable Care Act (Public Law 111-148), as amended (the "Act"). In the meantime, pending such repeal, it is imperative for the executive branch to ensure that the law is being efficiently implemented, take all actions consistent with law to minimize the unwarranted economic and regulatory burdens of the Act, and prepare to afford the States more flexibility and control to create a more free and open healthcare market.”
The four substantive sections of the executive order read thus:
“To the maximum extent permitted by law, the Secretary of Health and Human Services (Secretary) and the heads of all other executive departments and agencies (agencies) with authorities and responsibilities under the Act shall exercise all authority and discretion available to them to waive, defer, grant exemptions from, or delay the implementation of any provision or requirement of the Act that would impose a fiscal burden on any State or a cost, fee, tax, penalty, or regulatory burden on individuals, families, healthcare providers, health insurers, patients, recipients of healthcare services, purchasers of health insurance, or makers of medical devices, products, or medications.
To the maximum extent permitted by law, the Secretary and the heads of all other executive departments and agencies with authorities and responsibilities under the Act, shall exercise all authority and discretion available to them to provide greater flexibility to States and cooperate with them in implementing healthcare programs.
To the maximum extent permitted by law, the head of each department or agency with responsibilities relating to healthcare or health insurance shall encourage the development of a free and open market in interstate commerce for the offering of healthcare services and health insurance, with the goal of achieving and preserving maximum options for patients and consumers.
To the extent that carrying out the directives in this order would require revision of regulations issued through notice-and-comment rulemaking, the heads of agencies shall comply with the Administrative Procedure Act and other applicable statutes in considering or promulgating such regulatory revisions.”
As The Washington Post’s news article on the issuance of this executive order, noted, “The order, several paragraphs long, does not identify which of the many federal rules that exist under the ACA the new administration intends to rewrite or eliminate. In general, federal rules cannot be undone with a pen stroke but require a new rulemaking process to replace or delete them.”
Ashley Parker and Amy Goldstein wrote the Post article, which was published at 10:39 p.m. eastern time. Parker and Goldstein quoted Larry Levitt, senior vice president at the Kaiser Family Foundation, as saying that “Potentially the biggest effect of this order could be widespread waivers from the individual mandate, which would likely create chaos in the individual insurance market.” In addition, he said, the order suggests that insurers may have new flexibility on the benefits they must provide. “This doesn’t grant any new powers to federal agencies, but it sends a clear signal that they should use whatever authority they have to scale back regulations and penalties. The Trump administration is looking to unwind the ACA, not necessarily waiting for Congress,” Levitt told the Post reporters.
Meanwhile, Julie Hirschfeld Davis and Robert Pear, writing in a New York Times article also published late Friday, wrote that “The one-page order, which Mr. Trump signed in a hastily arranged Oval Office ceremony shortly before departing for the inaugural balls, gave no specifics about which aspects of the law it was targeting. But its broad language gave federal agencies wide latitude to change, delay or waive provisions of the law that they deemed overly costly for insurers, drug makers, doctors, patients or states, suggesting that it could have wide-ranging impact, and essentially allowing the dismantling of the law to begin even before Congress moves to repeal it.”
They also noted that “The order has symbolic as well as substantive significance, allowing Mr. Trump to claim he acted immediately to do away with a health care law he has repeatedly called disastrous, even while it remains in place and he navigates the politically perilous process of repealing and replacing it.”
In their analysis of the Trump action, Hirschfeld Davis and Pear saw three practical consequences on the current functioning of the ACA: potentially “a substantial weakening of one of its central features: the so-called ‘individual mandate’ that requires most Americans to have health insurance or pay a tax penalty; the potential for greater federal agency receptivity to requests for waivers under Medicaid, with numerous Republican governors and state legislators seeking to charge Medicaid beneficiaries higher premiums or co-payments than currently allowed; and finally, a potential relaxation in federal health insurance regulations that “could make the individual insurance market more attractive to insurers,” meaning that “insurers might then be more willing to stay in or return to the public marketplaces established under the Affordable Care Act.” Though Hirschfeld Davis and Pear did not say so, such a result might well be an ironic, unintended consequence of the loosening of federal regulations around the ACA, since a major charge leveled against the law by Trump and by congressional Republicans in the past year or more has been an increase in the premiums being charged by health insurers participating in the ACA-created federal and state health information exchanges.
Meanwhile, Jonathan Cohn, writing an article in The Huffington Post published late Friday night, quoted Timothy Jost, a professor in the Washington and Lee University School of Law in Lexington, Va., who said that the order mentions complying with the Administrative Procedures Act, which establishes a lengthy, drawn-out procedure for changing existing Obamacare regulations. “Not much will probably happen, until Price, Verma, and the IRS commissioner are in place,” Professor Jost told Cohn, referring to Rep. Tom Price, whom Trump has nominated to be Secretary of Health and Human Services, and Seema Verma, whom he has nominated to be the Administrator of the Centers for Medicare and Medicaid Services (CMS). “But then we will likely start seeing new proposed regulations and guidance that will interpret the ACA rather differently than the Obama administration did,” Jost told Cohn.
And, though the order appears to signal that Trump remains very serious about repealing the law, it could also give Congress a little more time to think about next steps, Jost told HuffPo. “One interesting question is whether this will reduce the pressure on Congress to come up with an immediate repeal-and-replace plan, since they can now say that Trump is dealing with the problems the ACA caused,” Jost said.
Healthcare Informatics will continue to update readers on this evolving situation.