Trump plan for healthcare: borrow from your insurance company
UnitedHealth jumps on the idea but economists say it's "profoundly disconnected" from reality
Can’t afford vital medical care because your health insurer won’t pay for it? The Trump administration thinks your insurance company should loan you the money — presumably at prevailing interest rates.
Economists and consumer advocates say that piling additional debt onto consumers already burdened by medical costs makes no sense.
“The last thing you want to do is increase deductibles and burden people with more medical debt,” Stanford economist Mark Duggan said in a New York Times report. “It seems to be profoundly disconnected from the realities people are facing.”
The brainstorm is tucked inside a 1,121-page Affordable Care Act final rule published last month. In it, the Trump administration encourages health insurers to consider lending money to consumers who cannot afford their deductibles. Patients facing major medical bills or emergencies would be able to take loans from their insurers and repay them, presumably with interest.
Critics in the Times account panned the approach.
Dr. John Scott, a trauma surgeon and health services researcher at the University of Washington, said the proposal “seems to merely shift the responsibility of the debt rather than addressing the core problem.” Louise Norris, a policy analyst at healthinsurance.org, was skeptical that “there will be significant interest from either insurers or consumers.” Joel White, a healthcare consultant who advises Republicans, told the Times the underlying tradeoff is real: “With a higher deductible, you get a lower premium. People are searching for any form of relief.”
Whatever experts say, UnitedHealth Group is poised to act on the invitation. Its Optum division already operates a bank that offers health savings accounts for pre-tax medical spending and lends money to healthcare providers.
Accounts expected to decline
Besides the loans from insurers clause, the rule reinstates pre-enrollment verification for Special Enrollment Periods, requires additional income documentation in certain cases, and aligns eligibility for advance payments of the premium tax credit with provisions of the Working Families Tax Cut.
In a news release, Medicare officials said the changes “ensure that federal subsidies are reserved for eligible individuals and reduce the risk of improper enrollments.”
The issue arises largely from the Republican-controlled Congress’s decision last year to end additional federal tax credits. Those subsidies significantly reduced the cost of Americans’ premiums.
But a pending lawsuit warns the rule will lead to at least 3 million Americans losing coverage on the ACA exchanges in 2026 alone and result in higher premiums and out-of-pocket costs for the remainder.
Centene, the country’s largest Medicaid insurer, said Monday it would offer buyouts to some employees, CNBC reported, and now expects ACA membership to decline nearly 40 percent by year-end after losing about 2 million members in the first quarter when enhanced federal subsidies expired.