TRUMP TAKES ON OBAMACARE.

• Author: Suderman, Peter
• Position: POLICY - Patient Protection and Affordable Care Act

IN OCTOBER, AS Republicans in Congress moved on from a failed effort to pass health care reform legislation, President Donald Trump took a series of steps to alter the administration of the Affordable Care Act on his own.

He issued an executive order to create additional paths for individuals and small businesses to purchase insurance that does not comply with all of the law's regulations. He also cut off a series of subsidy payments to health insurers that a federal court had ruled were illegal. These moves were preceded by a decision in September to reduce the money spent encouraging people to sign up for insurance through government-run exchanges.

Supporters of the law, better known as Obamacare, argued that these actions amounted to intentional sabotage. Some close to Trump seemed to agree. At a conference for conservative activists, Steve Bannon, a former senior adviser to the president, approvingly said that cutting off payments to insurers would destroy the exchanges.

The reality is likely to be less dramatic. Trump's executive order will take a long time to implement, and may have little if any effect. The reduction in advertising spending may reduce enrollment slightly, but probably not by a huge amount. And while cutting off insurer subsidies may cause some initial turbulence, in the long run it could result in more subsidized health coverage, and greater federal spending on the law, because Obamacare increases taxpayer-funded subsidies when premiums rise for typical plans.

Trump's executive order calls for agencies to facilitate the purchase of health insurance across state lines, specifically by looking for ways to expand the use of association health plans, which let small businesses band together to buy insurance that isn't subject to all of Obamacare's regulations. It also instructs federal agencies to look for ways to make it easier for individuals to access short-term insurance plans that are similarly exempt from Obamacare's rules.

Both instructions are geared toward creating an escape hatch from the law, if only at the margins. Some worry this will draw healthy people away from the exchanges, forcing insurers to raise prices on plans. This would likely be true of any attempt to allow the purchase of coverage outside of the health law's architecture.

The actual effect of Trump's push will probably be limited, however. The order itself formally changes nothing about the administration of the law. It simply asks executive...