The President signed an Executive Order with the intent to bring sweeping changes to the health insurance industry. The Executive Order focuses on three primary areas:
Expanding Association Health Plans (AHP)
Within 60 days from the date of the Executive Order, the Secretary of Labor shall consider proposing regulations or revising guidance to expand access to AHPs. This will make it easier for small businesses to pool their employee bases to increase their purchasing power.
Expand Availability of Short-Term, Limited-Duration Insurance (STDLI)
Within 60 days of the date of the Executive Order, The Secretaries of the Treasury, Labor and Health and Human Services are to provide guidance on expanding the availability of STDLIs. This is to include allowing the STDLIs to cover a longer term and also to be renewed by the consumer.
Expand Availability and use of Health Reimbursement Accounts (HRA)
Within 120 days of the date of this order, the Secretaries of the Treasury, Labor and Health and Human Services are to provide regulations to expand the usability of HRA, employer’s ability to offer HRAs and to allow HRAs to be used in conjunction with nongroup coverage.
Implementation of these items will also allow insurance companies to sell across state lines, which is one of Trump’s major campaign promises.
What Does It Mean?
First and foremost, the Executive Order does not eliminate the Affordable Care Act‘s Employer Mandate. Employers that meet the Applicable Large Employer threshold will continue to have to comply with the ACA on offering insurance to their employees or face penalties. It also does not eliminate the IRS requirement to file 1094/1095 forms.
The extent that these changes will have any direct effect on insurance rates or availability is still unknown. In a best case scenario, it would take 6 months or more to actually implement these changes. It is anticipated lawsuits will be filed to combat the Executive Order, which would further drag out the implementation of any changes.
The best course of action is to keep abreast of the status of the Executive Order. You’ll be able to plan accordingly when and if any changes take affect. MyHRConcierge will keep you up to date as the process unfolds.
Chris Cooley is co-founder of MyHRConcierge and SMB Benefits Advisors. Clients rely on him for HR compliance and administration, workforce management and benefits advisory solutions. Cooley’s companies specialize in helping small to mid-sized companies throughout the U.S. Chris can be reached at (855) 538-6947, ext. 108 or at firstname.lastname@example.org.