Although the Senate’s effort to repeal and replace the Affordable Care Act has failed, the Trump administration seems intent on not enforcing the regulations governing the law in order to make it fail.

After it became clear that more Republicans would not vote for the latest version of the Senate health care bill, Senate Majority Leader Mitch McConnell said he would instead push for a vote on a bill that would repeal the ACA with no replacement – but that notion also fell flat.

And a straight repeal bill looked even more dead on arrival as it would leave the nation’s health insurance and health care system in chaos.

Additionally, the Congressional Budget Office in January said in a report that repealing the Medicaid expansion and exchange subsidies while not touching other parts of the ACA would spell the end for many insurance markets. It noted that would under such a scenario 32 million more people would be uninsured and premiums would almost double.

The latest Republican senators to come out against the Senate health care bill were Mike Lee of Utah and Jerry Moran of Kansas, who joined Rand Paul of Kentucky, Susan Collins of Maine, Lisa Murkowski of Alaska and Shelley Moore Capito of West Virginia in opposition.

Lee and Moran said in statements that they wouldn’t support McConnell’s bill because it did not go far enough to address the rising cost of health care.

There may be a legislative effort later, but it’s not clear. McConnell recently said publicly that if the GOP could not move the current legislation or repeal the ACA, they would quickly have to cooperate with Democrats to shore up some state insurance markets which have been losing insurers willing to write coverage.


Letting it fail

So what’s left now is a law that is still in jeopardy as President Trump has promised to let the ACA die by not enforcing the regulations that govern it. That would mean:

  • Not enforcing the employer mandate.
  • Not enforcing the individual mandate to purchase coverage for people who do not receive it from their work.
  • Not enforcing the penalties for not complying with the employer and individual mandates.
  • Not pursuing an appeal against a lawsuit challenging the legality of the tax credits used to help people buying coverage to afford it. If the Trump administration fails to appeal an earlier ruling, which has been stayed pending appeal, the subsidies would be deemed illegal and disappear.
  • Not enforcing the IRS reporting requirements


The individual mandate and its associated penalties are a key pillar of the ACA. If there is no penalty for people not to comply with the law and purchase coverage, exchanges are likely to be left with a sicker and older pool of insureds, which will drive up premiums.

And if the appeal against the subsidy lawsuit is dropped and subsidies disappear, it would put the cost of insurance out of reach for many individuals and families that currently purchase insurance on exchanges.

Trump said if he let if fail by not funding tax credits and not enforcing regulations, that the Republicans would not “own it.”

“We’ll let Obamacare fail, and then the Democrats are going to come to us to repair it,” he said.


Is a bipartisan effort on the horizon?

There seems to be some willingness to explore a bipartisan solution to shore up the ACA, particularly in markets that have seen an exodus of insurers willing to write coverage in the individual market and through government-run exchanges.

Lamar Alexander, the Republican chair of the Senate Health, Education, Labor and Pensions Committee, said in a statement that his panel would hold hearings to explore “how to stabilize the individual market” under the existing law.

And Democrats seem willing to work with the GOP, as Senate Minority Leader Charles Schumer and House Minority Leader Nancy Pelosi have called on Republicans to work with Democrats on making the ACA stronger.

This blog is not intended to provide legal advice, but rather perspective on recent regulatory issues, trends and standards affecting health insurance, voluntary benefits, 401(k) plans and other employee benefits. Please consult your broker or legal counsel for further information on the topics covered herein.