A number of legal experts have warned that President Donald J. Trump's plan to allow Americans purchase insurance across the state lines may violate the federal laws that govern the employee benefit plans. The President said that there is an even chance of signing an executive order permitting people to cross the state lines to get excellent healthcare. He claimed that such an arrangement would be virtually free for the federal government.
Derailing the ACA
A number of healthcare analysts said that if the plans become a reality, they would decrease the effectiveness of the Affordable Care Act (ACA), a signature achievement of former President Barack Obama. The plan involves US citizens snapping up skeletal cheap health insurance policies. Supporters of the new plan say a greater number of people would be able to purchase health insurance at a much lesser expense.
Experts opine that Trump's healthcare plan may violate the US Employee Retirement Income Security Act or ERISA. This is a federal law governing big group plans. These plans are maintained or provided by employee organizations or the employees themselves. Nicholas Bagley, professor, healthcare law, University of Michigan, said that the expansion of association plans to individuals other than employees cannot be termed legal in any sense of the term. ERISA prohibits associations to behave like employers. They cannot administer benefit plans. Allison Hoffman, Professor, University of Pennsylvania School of Law, said that federal regulators usually interpret the law to comprehend that association employers must have a standard common interest other than the purchase of insurance.
President Trump provided no specifics. However, a number of sources who knew the order said that this will be in the structure of a guide to the US Health and Human Services, along with the Labor and Treasury Departments. They would be ordered to find the ways small businesses and individuals could cooperate to form 'associations'. These associations will then purchase substantial group health plans from states which have the fewest regulations. It is evident that Trump's plan holds no water, and no amount of trying could violate ERISA.
Republicans, despite controlling both the Congress and the White House, have repeatedly failed in their efforts to repeal and then replace the ACA. They term the ACA or Obamacare as an ineffective and intrusive piece of legislation. The Democrats have defended this law, pointing out that the legislation has provided much-needed health insurance to about 20 million Americans.