7 ways commercial insurance could change in 2025

Republicans are expected to pursue, in 2025, a range of federal policy changes aimed at expanding certain commercial health plan options and controlling healthcare costs.

The new Trump administration and the Republican-led Congress were likely to re-try regulatory and legislative attempts from the first Trump administration, as well as new initiatives, said Joel White, president of the Council for Affordable Health Coverage.

The following are the leading policy changes they are expected to pursue.

Association Health Plan (AHP) expansion

AHP expansion was attempted through 2018 regulatory changes from the first Trump administration. The rule changes would have allowed more companies to band together through those arrangements and offer coverage to their employees. Such plans can have much lower costs since they are not subject to many of the extensive coverage requirements of the Affordable Care Act (ACA).

A lower court struck down the Trump regulations and a federal appeals court halted legal action until the Biden administration could revisit the rules. In 2024, the Biden administration reversed those rules through new regulations, which it said were needed because of concerns about fraudulent and mismanaged AHPs.

Republicans “learned from that. If they think they can do something on the regulatory side, they will go for it,” said White. “But it seems like Congress probably needs to step in and give the legal authority for AHPs.”

Short-term, limited-duration (STLD) plans

STLD plans could last for three years under new legislation, up from the four-month limit set by Biden administration rules. Such plans are 50% to 80% cheaper than ACA-compliant plans and offer an affordable option available year-round, said supporters. Critics of STLD plans said they lack many of the extensive coverage requirements of ACA-compliant plans.

That bill may advance quickly since it’s sponsor, Rep. Buddy Carter (R-Georgia), is chairman of the Energy and Commerce Health Subcommittee. 

“So, all of those things are more likely now that you have both sides of the Hill under one party,” White said.

ERISA protections

Employee Retirement Income Security Act (ERISA) protections for small employers would bar state regulations aimed at limiting employer access to self-insured plans or the stop-loss insurance necessary to mitigate risk or even banning ERISA plans for small employers. Such a policy also would prevent state rules, such as extensive administrative requirements.

Expanded use of health savings accounts (HSAs)

Expanded HSAs — tax-advantaged savings accounts paired with high-deductible health plans — could come through both regulatory and legislative changes. Some conservatives are pushing to allow HSAs regardless of the deductible amounts, as long as a plan meets a minimum actuarial standard. Other proposals would allow their use in Medicare, Medicaid and ACA marketplace plans.

Some conservatives have proposed IRS rule changes to allow the nearly 60 million Americans working as contractors to be allowed to receive HSA funds from their employers. Current rules prevent employers from offering such funds, said White, since it could change their employment status.

“As the gig workforce gets bigger, they’re missing out on significant help to help pay for their healthcare costs,” White said about projections showing such workers will total 80 million by 2027. If rule changes are approved, “that then becomes a tool that they can use to attract people to come work for them.”

Increased price transparency

Increased price transparency requirements and enforcement on prices negotiated with commercial plans could be an early priority of the Trump administration.

“What we’ve seen is a lot of non-compliance in the hospital space,” said White. “So, you could see probably better enforcement and increased penalties.”

Hospitals have argued most such facilities are compliant with the rules, but the information is costly to compile and not helpful to patients seeking care.

Transparency enforcement could expand to include the Trump administration tying it to Medicare’s conditions of participation, which White refers to as “the nuclear bomb on hospitals.”

“The common theme here is ‘give people more choices and give them the tools they need to shop for a better health plan,’” White said.

Congress also may act to increase transparency requirements on hospitals and others, White said, because such initiatives have strong bipartisan support.

Individual Coverage Health Reimbursement Arrangement (ICHRA)

ICHRA subsidies from employers that help workers buy plans could be expanded to allow non-ACA marketplace plans, he said. Rule changes also could allow employees to pair ICHRAs with HSAs to increase their buying power.

Republicans are likely to allow the expiration — at the end of 2025 — of an estimated $35 billion in annual expanded subsidies for ACA plans, which were first approved during the height of the pandemic, he said. They view the subsidies and auto-renewal rules for that coverage as fueling large-scale fraud, where coverage is funded for people who don’t want or need it. 

Essential Health Benefits (EHBs)

EHBs, which are the package of healthcare services every ACA-compliant plan must cover, also are a likely target of Republican actions. They have been critical of EHBs as a major driver of the high prices for ACA plans and for requiring enrollees to pay for coverage of services they don’t need. EHB tweaks could come through regulations, but any replacement would require Congress to act.

The new Department of Government Efficiency (DOGE) was likely to examine EHB requirements and recommend whether they should be modified or replaced, White said.

“So, then the question is ‘Is it worth it from a dollar perspective? And is it worth it from a political perspective, where people could view that you’re weakening benefits and trying to destroy the ACA?’”

Controversial congressional initiatives may prove unlikely since Republicans have a two-seat majority in the House (three open seats) and a three-seat majority in the Senate.

White said the EHB requirements are primarily responsible for reducing the share of small employers that offer health insurance to their workers from more than half of small businesses before the ACA’S enactment to 31% of such companies. ACA advocates counter that EHB requirements are needed to provide comprehensive health coverage.

Another reason for the small employer coverage reduction is “because small business owners know employees can get ACA subsidies they can’t compete with,” White said. That leaves those employers to say, “My employees are better off because I’ve shifted the premiums onto taxpayers, why wouldn’t I do that?”