How Trump could start dismantling ObamaCare on day one

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President-elect Donald Trump could not completely dismantle ObamaCare on his first day in office. But there is plenty he could do. 

Without any action by Congress, Trump on his first day in the Oval Office could immediately cancel “cost-sharing reductions,” the payments that help low-income ObamaCare enrollees afford their deductibles. 

{mosads}House Republicans have sued the Obama administration over these payments, arguing they are being made unconstitutionally because Congress has not provided an appropriation for them. 

Trump’s administration could simply drop its defense in that lawsuit in court and cancel the payments. 

Trump could also take other steps that might immediately disrupt coverage for many of the 20 million people who have gained healthcare under President Obama’s law. 

Trump promised on Thursday to “fix healthcare” during a visit to Capitol Hill but has provided scant details of what he plans to do beyond a desire to repeal ObamaCare. 

The president-elect and Republicans argue the law has reduced choices with heavy regulations and led to rising premiums. 

Trump can also hurt the Affordable Care Act by doing essentially nothing at all. 

Insurers have already had complaints about ObamaCare, noting a smaller and sicker group of enrollees than expected. 

The Obama administration has been working to address those concerns, making a range of small policy tweaks. 

If the Trump administration dropped those efforts, even more insurers could drop out in 2018, further reducing options for people and possibly leaving some areas of the country with no ability to get ObamaCare insurance at all. 

Trump will be taking office with 11 days left in ObamaCare’s annual sign-up period, usually a time of intense outreach efforts to encourage people to sign up. Trump could drop those efforts, potentially shrinking enrollment. 

Any actions Trump would take on his own would come alongside a broader, parallel effort in Congress to repeal the law. 

But the effort in Congress could take months. Republicans don’t have the required 60 votes in the Senate to repeal the law under the normal process, so they will likely use a complicated special process called reconciliation to allow the measure to pass with a simple majority. 

That process will take time, and even after repeal passes, it is likely that it would not take effect for months or even years, giving time for Republicans to try to come up with a replacement. 

Administrative actions would have a more immediate effect. But Trump could face political blowback for disrupting healthcare for people if he does not wait for Congress to act and provide a transition. 

“What’s likely to be a big consideration for the Trump administration is whether they find it advantageous to introduce chaos into the insurance market,” said Larry Levitt, a health policy expert at the Kaiser Family Foundation. “Once they take office they can blame certain things on the previous administration, [but] at some point they start to own these problems.”

Republicans have been decrying a range of programs aimed at shifting money among insurers to cushion them from heavy losses in the early years of ObamaCare. 

Some insurers have sued over a shortfall in payments in one of these programs, called risk corridors. The Obama administration has said it is open to paying a settlement to those insurers. 

A Trump administration would be likely to decline to settle with insurers. Trump could also redirect away some funds under a similar program called reinsurance. 

All these actions would worsen insurers’ financial situation and could lead to premium hikes for 2018 or insurers simply dropping out. 

“Insurers are going to be pretty reluctant to participate in 2018 unless and until they have some certainty,” said Nicholas Bagley, a law professor at the University of Michigan who tracks the Affordable Care Act. 

The cost-sharing reductions are an obvious starting point for Trump.

“The cost-sharing reductions would be the clear top issue,” said Chris Jacobs, a former Republican congressional staffer and a health policy analyst.  

That step would cause major turmoil in the health law’s marketplaces. 

Insurers would still be required to give discounts to low-income people, they would just no longer get reimbursed by the government through the cost-sharing reduction payments, blowing a hole in their budgets. 

Some insurers might decide to just drop out of ObamaCare in the middle of the year, leaving their enrollees stranded, if the payments were canceled. 

“We’re in a world of a great deal of uncertainty,” said Bagley.

The situation is a troubling one for insurers. 

“It’s something that we are thinking about, but it’s far too soon to know the new administration’s position,” said Kristine Grow, a spokeswoman for America’s Health Insurance Plans, when asked if insurers are worried or planning for the possibility of the payments being canceled.

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