Trump signs executive order on Obamacare; impact unclear

On his first day in office, President Donald Trump signed an executive order that gave federal agencies broad authority to defer or delay any part of the Affordable Care Act that costs anybody any money.

More formally, the order tells agencies they can "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."

That's a mouthful, but what does it mean, and how far does it go to repeal Obamacare?

Larry Levitt, senior vice-president at the respected and neutral Kaiser Family Foundation, said in a series of tweets that while the impacts are unclear, it shows the administration is "moving to unwind the Affordable Care Act, but it won't be immediate."  

Levitt added, "One sure outcome is it creates uncertainty for insurers at a critical time."

Health care analyst Sabrina Corlette at Georgetown University echoed Levitt's point.

"For insurers already uncertain about their future in the Affordable Care markets, the uncertainty this executive order generates doesn't help," Corlette said. "At a minimum they'll have to factor it into their 2018 premiums, which are due to be filed by May 3 in most states."

Robert Laszewski, a health care policy consultant who takes a dim view of Obamacare, said the action raises a host of questions and gives little guidance.

"How will they expect the new Secretary of Health and Human Services and the IRS commissioner, for example, to interpret this?" Laszewski asked. "Just exactly what are they trying to accomplish? Do they only want to make things easier for those in the market, or are they out to just plain blow up Obamacare as soon as possible?"

The reaction from the insurance industry trade group America's Health Insurance Plans has been subdued. The group issued a short statement saying, "We have been meeting with policymakers to offer our recommendations for a better marketplace, and we have found them to be highly engaged and focused on finding real solutions."

Some analysts, including Joe Antos at the market-oriented American Enterprise Institute, see more symbolism than substance in Trump's action. Antos told us that practically speaking, the order doesn't move the ball forward at all toward the goal of repealing the Affordable Care Act. Agencies already had wide latitude on enforcing the law that everyone have insurance or granting states exemptions to Medicaid rules.

"It doesn't create any new authority for any executive branch agency," Antos said. "It basically gives them the instruction to do your job."

The executive order itself only affirms the general policy thrust that everyone understood from Trump's campaign, Antos argued. As far as real change goes, he said, the White House lacks the people to actually green light any specific move.

"They won't have a full team of people until the end of February or even later," Antos said. "When you're operating without a full team, you won't waste time with small stuff anyway. You will focus on what matters most because that is where the money is."

Nicholas Bagley, a law professor at the University of Michigan, posted an assessment that largely agrees with Antos. "For now, the executive order hasn't changed anything," he wrote.

But one element in particular has Bagley worried. The IRS enforces the individual mandate. If the agency plainly states that it won't, insurance mayhem could follow.

"The insurance markets in many states could go into a tailspin," Bagley wrote. "Rates for 2018 will skyrocket, and some insurers could fold."

But that hasn't happened yet.

We continue to rate this promise In the Works.