Press "Enter" to skip to content

New York Insurance Chief Slams Trump’s Executive Order

­New York Insurance chief slams Trump’s executive order. New York’s top insurance regulator, Maria Vullo, said Thursday that President Donald Trump’s executive order unwinding certain Obamacare regulations would destabilize New York’s insurance marketplace.
Trump’s order, signed Thursday morning directs federal agencies to consider options to make cheaper, less comprehensive health plans available to more Americans. It offers association health plans as one way to accomplish that goal. The agencies have 60 days to consider proposing regulations, followed by a public comment period, so any changes are not expected to take effect until next year.
article continues below advertiseill allow thousands of small business employers to have the same purchasing power as large employers to get more affordable and generous insurance options for their workers,” Trump said during a ceremony at the White House before signing the order.
Association health plans allow small businesses to band together to purchase health insurance. They are currently permitted in New York but must cover 10 categories of health benefits and cannot charge higher premiums to people with pre-existing conditions in compliance with the Affordable Care Act. But the executive order would allow employers to form such groups across state lines and to be treated like large employers.
Most large employers are not required to cover all the benefits the Affordable Care Act deemed essential, such as maternity care and mental health, though many of them do. Their plans also are not required to pay for a certain percentage of the total cost of coverage, unlike the products sold to individuals on the marketplaces. These employers are regulated by the federal Employee Retirement Income Security Act, and are not subject to many Department of Financial Services’ rules.
Under executive order, Vullo said she fears that certain insurers will base operations in states with looser regulations and then sell the cheaper plans in New York. Vullo, who is superintendent of the state Department of Financial Services, spoke Thursday morning at a City & State event in Lower Manhattan, before the executive order’s signing. She based her comments on earlier reports that it would include association health plans.
“This is just an effort to preempt state law and to have larger players potentially reduce benefits with this idea of reducing premiums,” she said.
Health policy experts have suggested that the creation of such plans will lead businesses with healthier employees to flock to association health plans, while groups with less healthy members remain with ACA-compliant plans, leading their premiums to rise.
The executive order also directs federal agencies to consider expanding the availability of “short-term limited-duration” insurance. The Obama administration limited such coverage to less than three months, but it could be extended back to 364 days. Such plans are typically less expensive but offer fewer benefits than Obamacare plans. A migration to the short-term plans also could result in higher premiums in the ACA marketplaces.
Karen Ignagni, chief executive of EmblemHealth, said while the order could lower prices for younger, healthier consumers, the overall impact on the state’s individual insurance market could be “devastating.”
“If you create an inventive to remove low-risk individuals from pools, it will make costs soar for those who remain,” she said.
She questioned whether state officials would mount a legal challenge to the potential regulations given their encroachment on the state’s ability to regulate its insurance market.
Vullo, an attorney, said the potential changes might be unconstitutional.
“I don’t see how you can preempt states by an executive order,” she said. “There’s a supremacy clause in the United States Constitution, and Congress has the power to preempt. Congress did not pass this.”

Be First to Comment

Leave a Reply

Your email address will not be published. Required fields are marked *