SIOUX FALLS, S.D. - President Trump delivered on his promise to have a new tax plan before Christmas and he signed the bill into law Friday.
But the plan didn't just cover taxes, it repealed the individual health care mandate, part of the Obama Administration’s Affordable Care Act.
It is estimated that doing away with the penalty for not having health care could result in 13 million more Americans choosing not to purchase health insurance over the next ten years. Many worry that could cause premiums to go way up.
But health insurance providers based in South Dakota are telling their customers they don't think there is anything to worry about.
With a wave of a pen, President Trump did away with the penalty for not having health insurance.
“What we're concerned about is with the individual mandate going away is that the younger and the healthier would not purchase health insurance. That was the theory behind it,” Avera Health Plans CEO Debra Muller said.
Which some fear could drive up the cost of health insurance for people who chose to purchase it.
“For the insurance companies our risk pool gets smaller, so the people that probably keep their insurance are the sick people who know they're going to use it,” Sanford Health Plan Senior Director of Market Strategy Lisa Carlson said.
“In larger markets if you get to major metropolitan areas maybe Chicago, Miami, New York City, you'd see some of that happening,” Muller said.
Health insurance officials from both Sanford and Avera say they don't think South Dakotans have anything to worry about.
“The individual mandate itself hasn’t made much of a difference on premiums in this state. It's likely not having a mandate is not going to mean much in terms of premium increases in the future,” Muller said.
Both plans believe South Dakotans will continue to purchase health insurance regardless of the repeal of the mandate.
“They tend to purchase insurance because they need it and because they're getting subsidies to pay for it,” Carlson said.
84% of Avera Health Plans customers use subsidies to pay for health care.
“The advance premium tax credits are given by the market place based on household income and they help people pay a portion of their monthly premium,” Carlson said.
And those subsidies were not affected by the GOP tax plan.
“The tax credit is staying. The tax penalty to have insurance has been what was repealed,” Carlson said.