We’re less than three weeks away from it being official. After President-elect Donald Trump takes office January 20, you may find yourself selling a Trump insurance policy instead of an Obamacare policy to your health insurance leads. While some may obsess over who’s in charge, what really matters most for businesses is being prepared for what’s to come. For cold calling and health insurance prospecting, the most important thing is preparing for these Trump-like policies.
Trump campaigned on a “repeal and replace” platform when it came to Obamacare, aka, the Affordable Care Act. With the choice of Tom Price for Secretary of the Department of Health and Human Services, that may, in fact, come to pass. Price is said to have been strategizing for some time on a 242-page plan to shake up health care law. Here’s what insurance agents should know.
Potential Changes Coming to Health Care Law
The first thing to note is that health insurance tax credits are likely to stick around. Price’s plan is said to offer a tax credit of $100 per month to adults under the age of 35, not much different than the kind of income-based discount available to many under Obamacare. The amount, in this case, would rise with age rather than income. However, the same provision would encourage health savings accounts (HSAs), which could help people plan ahead for anticipated expenses.
The emphasis on personal responsibility, patient choice, and planning ahead for medical care costs would alter the types of plans available, says one report. While the ACA requires health plans to cover 10 essential areas, under Price’s plan, insurers could have more choice on whether particular plans include mental health or maternity care.
The biggest distinction in what could become the Trump–Price policy is the lack of an insurance mandate. This could be good and bad. It will be good for young, healthy health insurance customers, who could see their premiums go down. Not so good for older, sicker customers who could be paying more for their higher use of care.
The lack of a mandate could cause problems for health insurance customers with pre-existing conditions. That provision is one of Obamacare’s most popular, and Price and Trump like it, too. However, Price wants patients to maintain coverage to enjoy the provision. If they lapse, he advises insurers charge could charge 150% of the standard rate for the next two years for that pre-existing condition. Critics say this mandate/pre-existing condition compromise could ultimately drive up costs.
That’s where Price recommends government-run, high-risk pools as a safety valve. In Utah, that plan used to cost patients as much as $400 in monthly premiums and the state as much as $16 million to subsidize. House Speaker Paul Ryan has said such pools today could cost $2.5 billion per year to fund.
A Trump–Price plan could also alter how much of a tax break businesses can take on group insurance benefit coverage. The fallout could be a higher insurance burden for employees, higher plan deductibles, and cut-back benefits.
The Likelihood of These Changes
Experts say that some of these changes will be easier to change than others. An end to tax credits, the individual mandate, and Medicaid expansion provisions of Obamacare could be enacted by Congress with a simple majority vote. However, most of the law can’t be undone with less than a two-thirds majority vote. Notably, that’s the situation for the pre-existing condition provision and the family policy coverage extended to young adults.
Agents Must Be Knowledgeable
Agents must be prepared for these Trump-like policies for the benefit of their business and their clients. Since we don’t know exactly what’s going to happen, being prepared in this case means being informed. And as you stay informed on this issue, strategize with your clients and business in mind. Knowing is half the battle, and at this point, you know as much as anyone about what these politicians might do the reform health care.
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