HR Management & Compliance

Trump takes aim at ACA on first day in office

Following his inauguration on January 20, President Donald Trump signed his first round of Executive Orders, including one directing federal agencies to ease enforcement of some Affordable Care Act (ACA) requirements.

Trump told agencies to “waive, defer, grant exemptions from, or delay the implementation of”ACA provisions that impose fees or other burdens on a range of stakeholders, including individuals and health insurers.

Trump noted in the order that his administration ultimately plans to repeal the ACA. In the meantime, agencies should take steps to minimize the law’s burdens, he said.

“I think it’s more symbolic than anything else,” said H. Juanita Beecher, of counsel with Fortney & Scott and an editor of Federal Employment Law Insider. “It does send a message but I don’t know that it actually changes anything at this point in time,” she said.

The document doesn’t mention employers, but many employer requirements are written directly into the statute and its regulations. The order notes that agencies can’t change regulations without proper notice-and-comment procedures. That means employer requirements—from health plan obligations to breaks for breastfeeding mothers—are still in place for now, Beecher said.

The call for flexibility may apply mostlyto the U.S. Department of Health and Human Services (HHS) and its ability to offer flexibility to states in how they implement Medicaid, Beecher added.

The Executive Order is the second effort in recent weeks to begin the process of repealing the ACA. On January 12, the Senate passed a budget that, according to House Speaker Paul Ryan (R-WI), represented the first step. The House passed the budget the following day.

Following that effort, the Society for Human Resource Management (SHRM) wrote a letter commending lawmakers’ efforts and asking for several considerations as the repeal process moves forward. Specifically, SHRM said it will continue to advocate for the following initiatives:

  • Maintaining the flexibility and certainty afforded employers under the Employee Retirement Income Security Act (ERISA), which is essential to the success of the employer-based system;
  • Repeal of the 40 percent “Cadillac tax” on high-value, employer-sponsored healthcare benefits;
  • Eliminating requirements on employer-sponsored plans to ensure employers have the flexibility to design benefit plans that meet the unique needs of varying workforces; and
  • Allowing employers to adopt innovative strategies to improve health benefit offerings to lower overall healthcare costs.

Democrats pushed for details about the repeal during the January 18 confirmation hearing for Representative Tom Price (R-GA), Trump’s nominee for HHS secretary. Even Senator Lamar Alexander (R-TN), who said employers are cutting jobs to afford Obamacare mandates, pressed Price to at least make clear whether ACA repeal and replacement will happen at once or in pieces.

Price said that dismantling and replacing the ACA would happen “step by step” but declined to elaborate. “One of the important things we need to convey to the American people is that nobody is interested in pulling the rug out from under anybody,” he said. “We believe it is absolutely imperative that individuals [who] have health coverage be able to keep health coverage.”

Price offered few details about what a replacement would look like but did suggest states should play a larger role. Trump offered similar sentiments in his Executive Order.

Price declined to offer a timeline for repeal or replacement. He will face the Senate Committee on Finance January 24.

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