President-elect Donald Trump campaigned on repealing and replacing the Affordable Care Act, including the part that mandates people buy insurance or else pay a penalty. However, experts say people without coverage still need to buy it because it may be awhile before that penalty goes away.
Jim Waters, president of the Bluegrass Institute, a free market think tank in Kentucky, said the Trump administration will move fast on replacing the ACA, but consumers should still err on the side of caution.
“They should go ahead and sign up and they can always drop it altogether at any time,” Waters said.
People buying insurance plans for 2017 also shouldn’t be worried that those policies will be cancelled before next year’s end, according to Scott Harrington, a professor of health care management at the University of Pennsylvania.
Harrington said insurers have contractual obligations that don't allow them to stop providing coverage before a term is up. Insurers also have to notify the state that they won’t be selling insurance anymore, which is a state policy separate from the ACA.
“People should not think that just because of this election that they need to do anything different, or that they should be fearful that if they paid premiums for coverage, wonder whether they’re going to get that coverage,” Harrington said.
It could take years to undo the federal regulations that cemented the law. However, Trump could drop an appeal of House v. Burwell, which challenged President Obama’s executive order that funds subsidies that more than half of Kentuckians received to pay for individual market coverage on Kynect and now Healthcare.gov.
If that happened, insurers would no longer receive the money from the federal government for those subsidies but still be legally obligated to keep providing insurance. Insurers would likely drop out for the 2018 plan year. Still, 2017 plans wouldn’t be affected by that.
“I doubt that the individual mandate will be continued,” said Christine Eibner, senior economist at research group RAND Corporation. “But it could take a little while for this repeal and replace proposal to be enacted, and you’re taking a risk that the penalty won’t be there for the 2017 plan year."
A possible replacement of the individual mandate might be the Republican plan, which proposes a "continuous coverage" requirement. Under that type of plan, if a person has coverage and continues the policy without gaps in time, insurers wouldn’t be able to increase prices for having a pre-existing condition like diabetes or cancer.
But if there’s a gap in insurance coverage, an insurer could deny coverage.
