Following 18 months’ divisive and frustrating campaigning, Donald Trump has won the election. Trump’s presidency represents an opportunity to repeal the Affordable Care Act while working with employers and the health insurance sectors to replace it with tax-free health savings accounts (HSAs). Trump indicated as much throughout the campaign. His official platform on healthcare promised to “broaden healthcare access, make healthcare more affordable, and improve the quality of the care available to all Americans.” What can we expect from President Trump?
First, it’s important to remember that Trump is and always has been a corporate magnate. His attempts to replace the ACA will be favorable to employers, relieving them of the need to comply with as many regulations as possible and reducing their costs as much as possible. HSAs put the onus on the employee (or health plan member) and feature high deductibles. Although the tax-free (pre-tax) nature of HSAs is appealing to middle- and high-income Americans, it is of little value to the vast number of Americans living paycheck to paycheck. Cadillac plan taxes (i.e., proposed 40% excise tax on high-cost employer-sponsored plans) are likely to vanish in the process. The difficulty with President Trump’s plan is that his promised tax breaks for corporations and the wealthy as well as the tax-free HSAs will gut the healthcare budget dedicated to Medicare and Medicaid.
What his campaign specifically promised was that Americans would be able to buy health insurance coverage across state lines. Although this approach can stimulate competition, the advantage will clearly go to the very largest insurers and spur more mergers and acquisitions among insurers, ironically reducing choice in the long run.
I expect that President Trump will have the following impact on the health insurance and healthcare landscape: