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Trump trims ObamaCare signup period to protect insurers from system-gaming

April 13, 2017
  • Insurance sign-up period shortened to deter gaming of system
  • Trump still weighing undermining law after failing to repeal
Seema Verma makes a statement to the press outside the West Wing of the White House on April 13, 2017.

Photographer: Brendan Smialowski/AFP/Getty Images

The Trump administration finalized a set of rules that it says will help bolster insurer participation in Obamacare’s markets, even as the president presses for repeal of the law itself.

The rules, published Thursday by the Department of Health and Human Services, include shortening the health law’s sign-up season and limiting exceptions that let people enroll for plans outside the regularly allotted period. Insurers have said that people use the exceptions to game the system by only joining plans after they get sick.

“These actions are necessary to increase patient choices and to lower premiums,” said Seema Verma, administrator for the Centers for Medicare and Medicaid Services Administrator, which oversees the health insurance program. “While these steps will help stabilize the individual and small group markets, they are not a long-term cure for the problems that the Affordable Care Act has created in our health-care system.”

While Republicans have campaigned for years on a promise to repeal Obamacare, they failed in their initial attempt to rewrite the health law, canceling a planned vote last month. That’s left them responsible for running Obamacare, even as they debate how to replace it.

Industry Weighs In

America’s Health Insurance Plans, the industry’s main lobbying group, said the proposed changes are helpful, but not enough to stabilize the market. The insurance industry is focused on ensuring that the government keeps paying the ACA’s cost-sharing subsidies to health insurers, which President Donald Trump has threatened to cut off.

Congressional Democrats are warning they will fight to prevent Trump from doing so, in order to preserve these cost-sharing reduction subsidies which are used to lower insurance costs for poor Americans.

“There is still too much instability and uncertainty in this market,” Marilyn Tavenner, AHIP’s president, said in a statement. “Most urgently, health plans and the consumers they serve need to know that funding for cost-sharing reduction subsidies will continue uninterrupted.”

Thursday’s final rules are largely similar to a version initially proposed in February, before the Republican repeal attempt failed. They shorten the enrollment period to a month and a half, from three months, and require people to prove that they’re eligible for special enrollment periods. To encourage people to pay their insurance premiums, the rules require people to make up for missed payments before buying a new insurance plan, if they’re purchasing coverage from the same company they had in the past.

Reaching Out

In the finalized rules, the government indicated it will take steps to support enrollment in Obamacare plans. The Trump administration had scaled back some outreach in the final days of the 2017 enrollment period, leading to criticism that it had caused fewer sign-ups.

“We intend to conduct outreach to consumers to ensure that they are aware of the newly shortened open enrollment period,” according to the document.

The rule also allows more variation in the value of benefits that insurers can provide, within its classes of plans. The change could lead to some consumers facing higher out-of-pocket costs, but might also lower what they pay in premiums, drawing in more young and healthy enrollees, the government said.

Trump’s Threat

To pressure Democrats into supporting a replacement plan, Trump has suggested that he will let Obamacare “collapse.” He told the Wall Street Journal on Wednesday that he might withhold the cost-sharing reduction subsidy payments to insurers, a move that could result in insurers boosting premiums or leaving the markets entirely. Senate Minority leader Chuck Schumer has said the tactic wouldn’t push Democrats to work with Trump.

The Affordable Care Act relies on private insurance companies to offer health plans that individuals can buy, often with government subsidies, in its markets. The continuing uncertainty over how the Trump administration will manage the markets has unnerved insurers, contributing to decisions by several to announce that they won’t offer plans next year. Deadlines for insurers to file their 2018 plans with regulators are typically in May and June.


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