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A Look At Trump’s Executive Order on Obamacare — What Does it Actually Mean?


This evening, President Trump signed the first in what will surely be many Executive Orders. Below is the text of the substantive portions of President Trump’s order limiting the reach of the Affordable Care Act (“ACA”).

“Section 1.  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.


 This doesn’t really do anything specific, other than let people know that Trump is serious about repealing the ACA. The language is clear that the White House knows as long as the ACA is the current law, it has an obligation to implement and follow that law. Directing the executive branch to “take all actions consistent with the law…” in any context isn’t really saying much; such a statement basically means “get around the law as much as you like, but don’t break it.” The direction that the executive branch should “take action to prepare to afford the States more flexibility and control” for what’s to come is a bit amorphous, but doesn’t sound particularly dramatic.

“Sec. 2.  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.


Here’s where things start to get meaty. This section not only allows, but directs the entire executive branch, all its administrative agencies (looking at you, IRS), and the Secretary of Health and Human Services (Tom Price, assuming he is confirmed) to do everything they can to exempt as many people as possible from the obligation to comply with the ACA. One of the most controversial parts of the ACA is the “individual mandate” – which imposes a tax on individuals who do not have health insurance coverage. This Executive Order appears to direct the agency enforcing such a tax (the IRS) to find all the loopholes it possibly can and to push as many people as possible through those loopholes so that the individual mandate affects less people.

This is, by far, the most significant directive of this Order. Critics of the ACA have often pointed to the oppressive financial burden the individual mandate places on individuals, some of whom have even argued that the cost of the penalty is more affordable than that of insurance premiums. But regardless of either the wisdom or functioning of the individual mandate, it has a massive impact on the healthcare insurance industry as a whole. Insurance relies on two things: predictability and enrollment numbers. Removing the individual mandate affects both in potentially dramatic ways. The extent and shape of the effect this change will have on the insurance industry is uncertain, but there is little question that the industry will be impacted significantly and immediately. Consumers with current health plans aren’t likely to see their premiums change tomorrow, or next week, or even next month. But long-term consequences for insurance companies and their insureds are inevitable.

“Sec. 3.  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.”

Experts generally agree that an immediate repeal of the ACA without an adoption of some new plan is a risky idea. This section appears to attempt to mitigate the effects of a repeal without a replacement by encouraging states to create their own healthcare solutions. What states will choose to do, how those choices will affect individuals, and what role the federal government will have in assisting will become clearer over time.

“Sec. 4.  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.


 This section doesn’t point to any specific changes, and seems simply to direct the federal government to assist with the free market as it relates to healthcare. Theoretically, that might be a good thing for consumers – especially since this order specifically states that it has the “goal of achieving and preserving maximum options for patients and consumers.” What results this section will effectuate remains to be seen; directing federal agencies to encourage an open market “to the maximum extent permitted by law” certainly has potential to mean interfering with the state exchanges in some way. How, exactly, such interference could or would play out is anyone’s guess.

What this Order clearly does not do:

  • Take away anyone’s existing healthcare coverage. If individuals and families have insurance coverage through the state exchanges, it does not appear that anything in this EO would interrupt such coverage.
  • End any specific programs or initiatives. While it’s entirely possible that federal agencies will interpret the directive to stimulate the free marketplace as allowing them to discontinue certain federal programs, no such programs are specifically targeted at this phase.

As more information becomes available about the implementation of this Executive Order, we will keep you posted.


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Elura is a columnist and trial analyst for Law & Crime. Elura is also a former civil prosecutor for NYC's Administration for Children's Services, the CEO of Lawyer Up, and the author of How To Talk To Your Lawyer and the Legalese-to-English series. Follow Elura on Twitter @elurananos