What a Trump Presidency Means for Health Insurance

The simple answer is that we really don’t know. The most Mr. Trump has said is that he will repeal and replace Obamacare with something “great.”

Since the Republicans will soon have control of all three branches of government, they will be able to do anything they want. At this point, we can only speculate about what they are likely to do given past attempts and current campaign promises.

First, as I pointed out to a long-time client the other day, don’t expect Obamacare to go away on Jan. 21st. Simply repealing it as some on the right will rush to do would leave a vacuum that would create a health crisis in this country.

It will take insurance companies about a year to gear back up to sell the kind of health insurance they used to sell. And then we will still be left with the issue of what to do about the people who have pre-existing conditions.

To avoid a crisis, Obamacare will have to be transitioned out of, just like the British have to transition out of the EU. What that will look like is to be seen.

So what can we expect? It does seem likely given past initiatives to repeal Obamacare, that the first thing to go will be the mandate to have insurance. That means that people who do not enroll in Obamacare plans will not face a tax penalty. The penalty was always functionally voluntary, but many people felt the obligation to pay it because the IRS told them to.

While we don’t know right now what the long-term landscape of health insurance will look like, in the short run, it seems fair to speculate that the penalties will soon be going away and people are now free to purchase the health insurance that best meets their needs and budget. For many people who don’t get much in the way of subsidies and who are healthy, that means they can buy Alternative plans like short term medical. These plans are very similar to what people had before Obamacare at a fraction of the cost of an Obamacare plan. Non-insurance industry people will sometimes call these Short Term Major Medical Health Insurance.

My average clients who buy an 11 month Alternative plan save about $250 a month, some much more, and have much lower deductibles and out of pocket expenses. The typical plan my clients purchase has a $2,500 illness deductible with 100% paid after the deductible, and a $250 accident deductible with 100% paid after the deductible. The plans have unlimited urgent care center visits with a $50 copay, doctor office visits with a carrier paid $50 copay, and prescription coverage. They don’t have maternity care and free preventative care, but they offer immensely larger networks than the typical Obamacare plan. For people healthy enough to qualify for them, they represent a tremendous value in health insurance.

If the mandate truly is going away, I would expect demand for plans like these to soar.

Please contact us for more information on plans like these and others that can save you thousands of dollars a year on health insurance.