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Trump ACA order bodes well for health industry, analyst says


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Trump ACA order bodes well for health industry, analyst says

President Donald Trump on Jan. 20 sent a strong signal that his administration was focused on providing regulatory relief to the healthcare sector, said Evercore ISI political analyst Terry Haines.

While Trump was not able to repeal the Affordable Care Act day one of his presidency — a promise he frequently made on the campaign trail — he signed an executive order hours after being sworn in aimed at weakening the law and setting it up for Congress to take apart.

That action, along with a memorandum from White House Chief of Staff Reince Priebus ordering government agencies to freeze all new regulations, bodes well for the healthcare sector, Haines said, calling both actions market positives.

Trump's order makes clear it is his administration's policy to seek a prompt repeal of the ACA — something he needs Congress' help to accomplish.

While lawmakers are working on repealing and replacing the law, which could take several months to complete, the new president said he wants his administration to "take all actions consistent with law to minimize the unwarranted economic and regulatory burdens of the act."

In his order, Trump said he also wants to ensure U.S. states have more flexibility and control to create a "more free and open healthcare market."

He instructed federal agencies to "waive, defer, grant exemptions from, or delay the implementation of any provision or requirement" of the ACA that would impose a fiscal burden on any state or a cost, fee, tax, penalty or regulatory burden on individuals, families, healthcare providers, health insurers, patients, recipients of healthcare services, purchasers of health insurance or manufacturers of drugs, devices or other medical products.

Trump's order acknowledges his administration is bound by the regulatory process, meaning it must follow the notice-and-comment rulemaking provisions of the Administrative Procedure Act. Under the law, the executive branch can only repeal regulations by going through the full rulemaking process, which may take about a year to complete.

"There is not likely to be much immediate initial change in ACA regulation or enforcement due to the need to follow [the] regulatory process," Haines said.

Another hold-up, he said, could be the confirmation process for Trump's candidates to lead the Department of Health and Human Services and the Centers for Medicare and Medicaid Services.

Those candidates also may not be confirmed by the Senate for weeks — possibly longer for the HHS nominee, Rep. Tom Price, a Republican from Georgia, whose stock trading in medical product companies has raised some concerns — so no direct actions can be taken, Haines said.

Speaking on ABC's Sunday political program This Week, Trump's senior White House adviser Kellyanne Conway said the president may soon use his authority to stop enforcing the individual mandate, which requires Americans to have health insurance or pay a tax penalty.

Conway said that "those who are relying upon coverage will not lose it." Democrats have made the argument that without the mandate, the ACA marketplaces will collapse because there would be no penalty ensuring healthier Americans enroll in insurance plans to balance out the sicker, more costly enrollees.