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The Trump administration announced a new policy on Monday making it easier for states to circumvent coverage requirements and consumer protections in the Affordable Care Act. States could, for example, use federal funds to subsidize short-term insurance plans with skimpy benefits and fewer protections for people with pre-existing conditions. Coming two weeks before Election Day, the new policy appeared to be a political gift to Democrats, who are making health care a potent campaign theme. (Pear, 10/22)

Under guidance issued Monday by the Centers for Medicare and Medicaid Services (CMS), states seeking federal waivers to run their insurance marketplaces will be given much more leeway. That includes the ability to apply ACA subsidies to short-term and association health plans — two types of coverage the administration has expanded as a way of making cheaper plans available to those who want them. These plans don’t include coverage of certain “essential” benefits like mental-health services and prenatal care and they can refuse to cover people with preexisting conditions. (Winfield Cunningham, 10/22)

The new proposal from the Department of Health and Human Services and the Treasury Department would not explicitly scrap the law’s protections, which bar health plans from denying coverage to people with preexisting medical conditions. But the administration plan would dramatically reshape rules established by the 2010 law that were designed to prevent states from weakening these protections. (Levey, 10/22)

Health advocates say the new policy is the latest example of the Trump administration allowing states to wiggle around ObamaCare requirements. While Congress was unable to repeal the law, the waivers will allow states to enact policies that advocates say counter the law’s intentions. During a call with reporters, Verma said she has received “numerous” requests from states for a more flexible waiver policy. The new guidance will take effect immediately, Verma said, but will only impact health plans in 2020 and later. Open enrollment for 2019 begins Nov. 1. (Weixel, 10/22)

Red states have expressed interest in skirting Obamacare requirements. Iowa, facing an exodus of insurers, last year proposed a waiver that would have reduced financial support to lower-income health insurance shoppers and created new aid for middle-income individuals. Iowa Gov. Kim Reynolds withdrew the plan last October, complaining that the waiver rules were "inflexible." Verma declined to comment on whether specific states would seek waivers under the new policy. Conservative health policy experts hailed the administration's announcement. (Goldberg, 10/22)

Waivers that lead some residents to drop insurance coverage will no longer be a deal-breaker, according to the notice. States must ensure that a comparable number of people remain covered. But the flexibility and potential shifting of exchange members to association health plans could make it seem like more people have adequate healthcare coverage even though access is worse. "The Trump administration's new guidance on state ACA waivers opens the door to states creating parallel insurance markets attractive to healthier people, with lower premiums but fewer protections," Larry Levitt, senior vice president at the Kaiser Family Foundation tweeted. (Dickson, 10/22)

Democrats said the move contradicted Republicans’ claims that they want to protect people with pre-existing medical conditions from high premiums. “The American people should look at what Republicans are doing, rather than what they’re saying, when it comes to health care,” said Senate Minority Leader Chuck Schumer (D., N.Y.). “Just weeks before the election, Republicans are once again undermining protections for people with pre-existing conditions and sabotaging our health-care system.” (Hackman, 10/22)

Vulnerable Republicans across the country have been scrambling to say that they support pre-existing condition protections to try to fend off a potent line of Democratic attack, but Schumer and other Democrats argued Monday that the new rules undermined those claims. “The American people should look at what Republicans are doing, rather than what they’re saying, when it comes to health care,” Schumer said. The Democratic Senatorial Campaign Committee added that every Republican Senate candidate “should be forced to answer for this.” (Sullivan, 10/22)

Kaiser Health News: Marketplace Subsidies May Be Option In 2020 For Plans That Skirt Obamacare

Earlier in the year, the administration also approved a rule allowing businesses to band together in “associations” to buy health insurance to offer insurance to members. Critics fear that rule could expose consumers to coverage gaps or higher out-of-pocket costs because these plans would be classified as “large-group plans” and not have to meet some ACA requirements. The changes unveiled on Monday do not affect people who get their coverage through their jobs. (Galewitz and Appleby, 10/22)

While the guidance takes effect immediately, it won’t affect insurance until the 2020 plan year. Open enrollment for 2019 begins Nov. 1, so plans and prices are already set. (McIntire, 10/22)