With the change in government, the Affordable Care Act (ACA), also known as Obamacare, will be repealed and replaced… this is certain. What is uncertain is how quickly and what the replacement will be.
President Trump’s first step to repeal ACA was signing an executive order that gives the new administration enough leeway to target the most unpopular aspect of Obamacare – a mandate requiring Americans to get coverage or pay a fine. Republican leaders say they will repeal Obamacare and replace it this year with a plan that doles out fixed tax credits and unleashes market forces to entice people into health care coverage rather than relying on a mandate to force them into coverage.
The intent of the individual mandate is to pull healthy people into the marketplace to balance the costs for less healthy customers who can no longer be denied insurance. Forcing healthy people to purchase ACA plans has become a huge financial burden on those who do not qualify for the present subsidized system. Premiums have risen and deductibles increased to the point that people would rather pay the fine than pay for health insurance that is unaffordable.
Republicans will be using fast-track budget rules to gut the individual mandate and other parts of the law in the coming weeks. I predict parts of the law that benefit people will be retained…. allow people with pre-existing conditions to have access to health insurance and financial assistance for those who qualify and children remain on parents plans through up to age 26.
What can you do today?
- Align yourself with a health insurance professional that specializes in individual health insurance as there are major differences between group and individual insurance. Many changes took place at the end of 2016 that affect the insurance plans available for individuals such as Short Term Plans being limited to only one (1) 3-month policy starting April 1, 2017.
- Enroll in a permanent health insurance plan with no annual renewal requirements to ensure certainty in an uncertain market.
- You should also diversify your health insurance coverage with supplemental accident, critical illness and disability – much as you would your financial planning. These supplemental plans will assist in covering deductibles and out-of-pocket expenses not covered by insurance.
- Look at living benefit life insurance options that provide a dual purpose – as a death benefit or use of the face value for medical and/or non-medical expenses if you have a critical, chronic or terminal illness. (Many people are using this option in place of long term care insurance).
If I had a crystal ball… I see the return of HSAs and major medical plans of the past, PPOs, more choice which will lower premiums and increase benefits. People will be able to keep their plan and their doctors…. hmm, sounds like Obamacare. Unfortunately, it didn’t turn out that way.
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