4 Things to Know About Trump’s Executive Order

In January 2017, President Donald Trump signed an executive order against the Affordable Care Act (ACA). Implemented by former President Obama, the ACA represents the most significant regulatory overhaul of the United States health care system. The purpose of President Trump’s executive order is to minimize the economic and regulatory burdens of the ACA by repealing it and coming up with a replacement plan. Before President Trump’s replacement plan takes place in the near future, here are four things you should know about the executive order.

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1. The Executive Order is Limited For Now

President Trump’s executive order offers only broad guidance, as it authorizes states and agencies to make changes based on “the maximum extent permitted by the law.” This directs agencies – Health and Human Services (HHS), Treasury, CMS Administration, IRS, etc. – to utilize their power to weaken the ACA, and prepare to provide each state with more flexibility and control in order to create a more free and open health care market. However, this is slightly limiting, and not much can be done until heads of the federal departments are officially appointed to oversee the ACA. Changes cannot be put into action until each head of these agencies are in place. Even after appointed, it may still take a while for changes to be implemented.

2. The Executive Order Could End the Individual Mandate

The Trump administration aims to no longer enforce the ACA individual mandate, which is a rule requiring individual Americans to carry health insurance or pay a penalty. If the individual mandate were to go away, the administration assured no one would lose his or her health insurance under the ACA while a replacement plan is still being developed. Instead, once President Trump implements a replacement plan – the administration will allow patients with pre-existing conditions to buy health insurance using health savings accounts.

3. The Executive Order Could Create Interstate Insurance Markets

One of the main goals of the executive order is to create interstate insurance markets, allowing individuals to purchase health insurance across state lines. Although the sale of insurance across state lines is already allowed under the ACA, President Trump is focusing on having the replacement plan be centered more on the patient while improving access to healthcare.

4. The Executive Order Plans to Cut Taxes

As a part of its execution plan, the executive order could undo some taxes under the ACA, including tax on health insurers and pharmaceutical companies. The order is also encouraging agencies to waive taxes, fees and penalties created under the ACA. Many of the revenue-generating taxes of the law are already planning to be cut by Congress, as it works on creating a bill focused on cutting budget-related parts of it. According to President Trump, his team has come up with a tax plan that is simple and a wonderful solution to the “failed disaster” that is the ACA. However, he also stated that although tax cutting is easy, it’s only a small part compared to what needs to be fixed as a result of the ACA. Once the healthcare system is sorted out, President Trump said he will go ahead with his tax cut plan.

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