And though many GOP lawmakers are not fans of Obamacare, most were also wary of them ending suddenly.
Senator Rand Paul, R-Kentucky, stood behind Trump as he signed the executive order.
It's expected to take months or longer to write the new rules and undergo the review process.
"Trump signed an exec order that could allow spread of cheap, loosely-regulated health plans (without) Obamacare protections", Planned Parenthood tweeted.
Trump signed an executive order Thursday that seeks to expand health insurance options beyond Obamacare plans. "The policy Trump will implement may have its merits: Current regulations prevent consumers from buying cheap, renewable coverage, and this will orient the health-care system in a freer direction".
Even moderate conservative voices were aghast by the move. They were criticized before Obamacare's implementation because people often did not realize how little coverage they had. Is now taking steps to make it implode.
"If these reports are true, the President is walking away from the good faith, bipartisan Alexander-Murray negotiations and risking the health care of millions of Americans". "Obamacare has proven itself to be a fatally flawed law".More news: Forget the iPhone 8, rumours about next year's iPhones emerge
The president says the order will provide what he calls "Obamacare relief" for millions of Americans. "Association health plans are going to allow these individuals to enjoy same benefits that large groups and large employers do". He said he would "pressure Congress very strongly to finish the repeal and the replace of Obamacare once and for all". He said: "We will fix that".
Trump stated that the formation of associations would create new opportunities for employers to buy plans for their employees, and would result in more options for people who now do not have insurance.
Small companies usually have difficulty affording insurance for their employees.
Obamacare's underlying logic is that covering people who get sick or are likely to become sick, due to their age or preexisting conditions, requires a big insurance pool with enough healthy people to spread risk evenly.
New York Attorney General Eric Schneiderman, who led a group of Democratic attorneys general to defend the subsidies in court this spring, said last night they would sue to stop the administration from acting.
However, experts expect the plans will be unlike insurance provided by big firms in a number of ways. Employers with low-priced plans and healthier workforces chose to be grandfathered out of many new requirements, leaving a much less healthy - and more expensive to cover - pool for pricing everyone else's insurance. "We will have great health care in our country".
Association health plans will not be required to carry those benefits. Six in 10 Americans now think it's the federal government's duty.