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How Will Health Care Insurance Change Under Trump?

January 23, 2017

About 150 million people are covered by employer-sponsored health plans in the U.S. What happens to them if Congress and the new Trump administration repeal the Affordable Care Act?

It depends on how far they go.

health care insurance
CCIG’s Scott McGraw.

Before his inauguration, Trump said the replacement he’d like to see for ObamaCare should cover everyone, a pledge that congressional Republicans have repeatedly declined to make. On his first day in office, Trump signed an executive order declaring that his administration will seek “prompt repeal” of the law. The order also commanded federal agencies to try to waive or delay requirements of Obamacare that impose economic or regulatory burdens on states, families, the health-care industry and others.

Assuming ObamaCare is ultimately repealed – and there’s not much reason to assume otherwise –  one of the biggest changes may come in the requirement that employers of a certain size provide coverage to their workers.

The ACA’s “employer mandate” requires that all businesses with 50 or more full-time equivalent employees provide health insurance to at least 95% of their full-time employees and dependents up to age 26, or pay a fine.

The fine begins at a flat $2,000 per full-time employee, excluding the first 30 employees. It rises to $3,000 per FTE if the health coverage doesn’t meet minimum value standards.

The mandate, although reviled by business interests, never affected large numbers of employers for one simple fact:

About 96 percent of employers in the U.S. are small businesses and have fewer than 50 FTE workers and, as a result, were exempt from the employer responsibility provisions. Moreover, of those who do have to comply with the mandate, only a fraction didn’t already offer coverage to full-time employees.

Still, should the mandate be repealed, it’s likely that some employers that began offering benefits after the ACA became law will decide to stop doing so. On the other hand, the reason most employers offer benefits won’t be going away anytime soon; as an employee recruitment tool, few things beat health benefits.

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The other big question for most employers is what might happen to health insurance prices.

There’s no easy answer on this one. Before the ACA, because insurers were able to deny coverage to sick people, they were able to keep overall costs down. Prices have climbed since then, but ACA proponents claim the increases would have been even higher without the law. It’s a safe bet to say prices will continue to rise, though no one knows by how much.

Finally, although no one knows exactly what might happen next, the big changes Trump has endorsed include:

  • changing the tax code to allow individuals to fully deduct all health insurance premiums;
  • allowing insurance plans to be sold across state lines, presumably increasing competition;
  • expanding access to health savings accounts that are tax free;
  • allowing medications to be imported, creating more competition in drug pricing.

Americans who bought individual coverage through the ACA exchanges are closely watching for whatever transpires. So are employers and, of course, so is CCIG. Feel free to call or email me with questions or concerns about whatever might be happening on the health care insurance front.

Scott McGraw is Vice President of CCIG’s Employee Benefits division. He can be reached at 720-330-7924 or

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