During his first term as president, Donald J. Trump succeeded in expanding short-term health insurance plans and tried but failed to repeal the Affordable Care Act (ACA).
His administration also attempted to make it easier to form an association for the purposes of purchasing health insurance that was exempt from many of the ACA’s requirements for health plans, an effort that was beaten back by the courts.
Now that he’s on his way back to the White House, what can we expect for health insurance coverage and regulations during his second term? For certain, there will be a focus on deregulation and efforts to lower costs.
Pundits from various trade publications have weighed in on what areas could be ripe for changes under a Trump presidency.
Changes to the ACA Impacting Health Insurance Plans
While Trump previously tried but failed to get the ACA repealed, he has indicated that he doesn’t want to repeal it but make changes to it this time around.
Absolute repeal is likely a non-starter considering that residents in a number of Republican-led states are heavy users of ACA marketplace plans, including Florida, Texas and Idaho, the latter of which runs its own ACA exchange. Florida and Texas residents purchase coverage on HealthCare.gov.
The Biden administration has focused on boosting enrollment in marketplace plans and the president signed legislation in 2022 that extended until the end of 2025 enhanced federal subsidies from the COVID era to help individuals purchase plans.
Thanks to those subsidies, people at the lower end of the income spectrum are often paying no or very low premiums for plans with generous coverage, such as low deductibles and copays, but even middle-income individuals see significant benefits.
With Trump in the White House, and the GOP in a majority in both the House and Senate, those subsidies may not be extended again.
Will Alternative Health Insurance Plans Rise Again?
The Biden administration repealed Trump-era regulations that significantly eased restrictions on short-term health plans, multi-state association health plans and hospital indemnity insurance.
For example, the first Trump administration rules allowed individuals to purchase short-term health plans and keep them in place for up to 364 days, which could be renewed or extended for roughly three years. The Centers for Medicare and Medicaid Services in September 2024 issued new final rules that limit short-term health insurance to up four months at most, without the possibility of renewal.
When originally floated about 10 years ago, short-term health plans were intended to provide temporary coverage for people in between group health plans.
Also, the Trump administration introduced a rule in 2018 that lowered the barriers to entry to association health plans that would be considered single-employer plans (and exempt from individual and small-group market rules).
The U.S. District Court for the District of Columbia in 2019 overturned the regulation and in 2023, the CMS repealed the regulation altogether.
Trump might attempt to rewrite the regulation in a way that may pass legal muster. Sen. Rand Paul (R-Kentucky) recently reintroduced legislation that would let any membership organization provide a self-insured, multi-state health plan.
Addressing Drug Costs
Trump in the past has supported plans to negotiate for lower pharmaceutical prices and make it easier to import drugs from lower-cost countries. He also advocated during his first term for pharmacy benefit manager reform.
Under the Biden administration, the CMS has started negotiating with drug makers for price reductions of commonly prescribed drugs for Medicare beneficiaries. The first round of negotiations took place earlier this year, helping reduce the prices that Medicare pays for 10 high-cost drugs.
Trump in the past has supported plans to negotiate for lower pharmaceutical prices and make it easier to import drugs from lower-cost countries. He also advocated during his first term for pharmacy benefit manager reform.
Under the Biden administration, the CMS has started negotiating with drug makers for price reductions of commonly prescribed drugs for Medicare beneficiaries. The first round of negotiations took place earlier this year, helping reduce the prices that Medicare pays for 10 high-cost drugs.
The CMS under Trump 2.0 may end up floating new regulations changing the parameters of the negotiations, and he may push again for government programs to import drugs from lower-cost countries, like Canada.
The Takeaway
Trump is entering office on the back of his populist policies, and that means making the working class happy.
He will have to work with two types of Republicans in Congress: traditional, establishment members and the ones who are not skeptical of the traditional GOP pro-big business and small-government ideology.
The president-elect will have the power to implement certain regulations that can change the health insurance marketplace, but they have to be written within the parameters of existing law and many changes can, and will, be challenged in court.
