The Trump administration on Monday said consumers who live in places with only one insurer on their Obamacare exchange can now duck the penalty for lacking coverage.
Also, pro-life Americans who could not find a plan that doesn’t cover abortion can avoid the penalty when they file their returns next year.
President Trump and his GOP allies recently zeroed out penalties tied to the Affordable Care Act’s “individual mandate” to hold health insurance, though the move doesn’t take effect until 2019.
In new guidance, the administration said people without options can qualify for new “hardship exemptions” so they aren’t hit with a penalty of at least $695 for going uninsured this year.
President Obama issued more than a dozen such exemptions during his tenure to allow certain persons, such as the homeless or victims of domestic violence, to avoid the tax penalty — a move that eased the burden for some, yet weakened the law’s main prod to get much-needed healthy people into the marketplace.
The Centers for Medicare and Medicaid Services’ decision Monday dramatically expands those exemptions, before the mandate penalty goes away completely.
This year, about half of U.S. counties had only one insurer operating on their exchanges, according to CMS Administrator Seema Verma. People living in areas can avoid the penalty if they attest, under penalty of perjury, the lack of choice prevented them from acquiring coverage.
The agency said it did not estimate how many actual people might be able to take advantage of the new exemptions.
CMS announced the changes as part of a broader series of tweaks to the Obamacare markets moving forward.
The administration wants states to beef up its verification process to make sure people actually earn the income they claim to get advanced tax credits that knock down their premiums.
They fear some people in states that didn’t expand Medicaid are inflating their incomes to levels above 100 percent of poverty, so they qualify for tax credits on the insurance exchanges.
And CMS said people can hold onto “transitional” plans that don’t fully comply with Obamacare for another year.
Mr. Obama allowed people to hold onto their bare-bones plans — in states that allowed it — after a wave of cancellation notices belied his promise that people who like their plans could keep them under his law.
Republicans failed to deliver on their vow to repeal Obamacare last year, though the White House says middle-class Americans are still desperate for relief from the 2010 law’s mandates.
Ms. Verma said the administration is “looking for ways within the law to alleviate its negative effects.”
Obamacare’s defenders say GOP tweaks from Washington are destabilizing the exchange markets after a relatively steady year of enrollment on the exchanges.
Mr. Trump wants to let people in similar trades band together to buy association plans that don’t comply with Obamacare’s coverage requirements. He also wants to let consumers opt into noncompliant “short-term plans” for a year, instead of just three months.
Democrats say those moves could siphon healthier consumers out of the exchanges, resulting in higher prices for people who remain.
“Instead of taking steps to prevent big premium increases this fall, the Trump Administration is watering down your health care and making it harder to get coverage,” Sen. Ron Wyden, Oregon Democrat, said. “Projections already showed double digit premiums increases this year due to the Trump Administration’s attacks on families’ health care, and today’s new rules pour gasoline on the fire.”
A top lobbyist for health insurers said Monday the outlook for 2019 is “not a pretty picture right now.”
“When you think about things like the individual mandate going away, some of the other proposed rules that are being put in place, whether it be around association plans, short-term policies — it’s just still a nasty soup right now that’s brewing,” Matt Eyles, who will rise to president and CEO of America’s Health Insurance Plans in June, told an event hosted by The Atlantic.
“We’re looking ahead to 2019,” he said, “and it’s not a really great picture right now, but I know a lot of companies are committed to the market.”