President Donald Trump planned Thursday to move forward inchanging U.S. health care by signing anexecutive order aimed at expanding low-cost insurance options, which critics saywill leave some with skimpy coverage and hurt already-strugglinginsurance markets.

This step would signal a shift in the administration’s strategy,which relied on Congress to repeal the Affordable Care Act. Trumpis now using the force of his executive rule-making authority toimplement long-favored GOP policy alternatives.

“With Congress the way it is, I decided to take it upon myself,”Trump said in remarks at the White House earlier in theweek. Senate Republicans failed within recent months to passlegislation to overhaul the ACA.

In Thursday’s directive, Trump is expected to loosen rulesaround policies sold through “associations,” which can be for instance,professional-affiliation groups.

While details are sparse, it could effectively exempt moreinsurance plans from a number of ACA requirements.

The order also will likely instruct regulators to allow insurersgreater leeway in selling low-cost, short-term insurance that canexclude coverage of policyholders’ preexisting medicalconditions.

“A big percentage of people will be able to get health care,”Trump said, “and it will not cost our country anything, but they’llhave great, great health insurance again.”

Since Congress can't get its act together on HealthCare, I willbe using the power of the pen to give great HealthCare to manypeople – FAST

— Donald J. Trump (@realDonaldTrump) October 10, 2017

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The pros and cons

Proponents say allowing small businesses and possiblyself-employed people to buy insurance through associations givesthem more clout with insurers than buying their own plan on theindividual market — and results in lower premiums.

But the real savings in premiums is likely to come because thepolicies could offer fewer benefits than more regulated ACA plans,and the associations would have more leeway to set premiums basedon the health of the group.

Trump’s order is likely to please some groups, including theNational Federation of Independent Business. This organization haslong supported association health plans, which they say allowssmall businesses to buy coverage across state lines.

Critics warn that such plans, with pared-down coverage and lowerpremiums, could siphon off the healthiest consumers. Older, sickerpeople would be left to seek health insurance through moreregulated plans available through state and federal insurancemarketplaces. That could cause premiums to rise more rapidly forthose groups.

Some consumer advocates also warn that association plans andshort-term policies are generally less generous with benefits – andcould leave some unwary consumers stuck with large medical bills.Such plans might not cover maternity care, for example, orprescription drugs.

Additionally, short-term plans can exclude paying for anypreexisting medical conditions, either upfront or upon renewal,something the ACA bars for all other types of insurance.

Legal challenges to the executive order could result from theseissues.

For one thing, policy experts question whether the Trumpadministration can allow associations broad leeway to sign upindividuals, rather than following the Obama administration’sstrict definition of “rare instances” in which an association wouldqualify as an employer offering group coverage.

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Kaiser HealthNews (KHN) is a national health policy news service. It isan editorially independent program of the Henry J. Kaiser Family Foundation.

That distinction is important because a complex mix of lawscover employment-based insurance coverage, and rules can differfrom those governing small-group or individual coverage.

It could be challenging “for them to extend [this coverage] toindividuals who are not associated with an employer group,” saidKevin Lucia, a research professor at Georgetown’s Health PolicyInstitute.

Associations prefer to be viewed as employers offeringlarge-group coverage because then their polices need not cover all10 of the ACA’s “essential health benefits,” which include thingslike hospitalization, drug coverage, maternity care and substanceabuse treatment.

Insurers can also vary premiums for large groups based onmedical claims history of the overall group, so younger, healthiergroups would likely get lower premiums.

In the individual market, insurers cannot base a premium on apolicyholder’s health.

A speckled past

Association health plans are not new. They’ve been around fordecades, and Republicans have traditionally eyed them as a means tomake it easier for small businesses and individuals to bandtogether to buy insurance.

In the past, though, some had solvency problems and wentbankrupt, leaving consumers on the hook with unpaid medicalbills.

In several states, regulators investigated whether the planswere advertising that they had comprehensive coverage when, infact, they provided little or no coverage for such things as chemotherapyor doctor office visits.

The ACA answered some of those concerns by setting minimumstandards for coverage on most insurance policies, includingassociation plans, which prevents them from skimping on such thingsas doctor visits or prescription drugs.

Their numbers fell after the sweeping law went into effect.

Meanwhile, the Trump proposal also would allow people to buyshort-term plans that last up to 364 days, overturning an Obamaadministration rule limiting short-term policies to 90 days.

Advocates of the change have always argued that this limit justmeant people had to renew more often — and then face theirdeductibles all over again.

How will association plans fare?

Joe Antos, at the conservative American Enterprise Institute,questions how popular such plans would be with both consumers andinsurers.

“The people on the left who say this will doom the exchangemarketplace are, as usual, exaggerating the likely effects ofthis,” said Antos.

That’s because many of the approximately 9 million people whocurrently buy coverage through federal or state insurancemarketplaces get a premium subsidy to help them purchase. They areunlikely to switch from that, he said.

The main group that it would appeal to are the additional 10million or so who buy coverage because they don’t get it throughtheir jobs, and don’t get a subsidy.

Key will be just what the plans cover — and what theyexclude.

“They’ll only be attracted if these association plans actuallyprovide them coverage they want at a price that is better than theexchange plans,” said Antos.

Critics of ACA rules requiring policies to cover maternity careor mental health conditions have always cited these dictates as areason for high premiums. Antos noted, though, that those costspale when compared with the expense of what most people want, suchas coverage for hospitalization.

“That’s really expensive,” said Antos. “But no one wantscoverage that excludes hospitalization.”

So, insurers — if they even want to back association coverage —may end up offering coverage “that will look a lot like theexchange plans,” Antos said.

Kaiser HealthNews (KHN) is a national health policy news service. It is aneditorially independent program of the Henry J. Kaiser FamilyFoundation.