On March 10, the Centers for Medicare & Medicaid Services released the Marketplace Integrity and Affordability Proposed Rule, proposing new rules for the health insurance marketplaces. Here’s an overview of those rules, their impact on enrollment, and the next steps:
What is the Marketplace Integrity and Affordability Proposed Rule?
The Marketplace Integrity and Affordability Proposed Rule is a set of proposed changes to policies related to enrollment and eligibility in both Federal and State Exchanges for the Affordable Care Act (ACA) Marketplace. CMS frames these policies as necessary to combat fraud and abuse. The rules also strengthen the integrity of the ACA eligibility and enrollment systems.
This proposed rule follows a memorandum issued by President Trump in January 2025, which instructed executive departments and agencies to deliver emergency price relief for the American people. CMS states that the proposed actions aim to relieve rising healthcare costs by reducing waste, fraud, and abuse, which they expect would provide premium relief to families who do not qualify for Federal premium subsidies and reduce the burden of ACA premium subsidy expenditures to the Federal taxpayer.
What are the major provisions of the rule?
Provisions of the rule include:
Income Verification Policies
CMS proposes several changes to the income verification process for applicants to apply through the Exchanges, stating these are necessary to combat fraud.
Allowing Insurers to Deny Coverage for Past Due Premiums
CMS proposes to repeal a provision that prohibits insurers from requiring enrollees to pay past-due premium amounts to receive new coverage. Subject to state law, insurers could add past-due premiums to the initial premium amount and deny coverage if the total is unpaid. The stated purpose is to curtail individuals from taking advantage of guaranteed coverage while strengthening the risk pool and lowering gross premiums.
Revision of Premium Payment Thresholds
CMS proposes to remove flexibilities that allow insurers to implement fixed dollar and/or gross percentage-based premium payment thresholds whereby insurers would consider premiums paid. Only a net premium percentage-based payment method would be allowed going forward. Enrollees must pay at least 95% of the net monthly premium owed.
Shortening the Open Enrollment Period (OEP)
The OEP for all individual market exchanges and off-exchange individual health insurance (non-grandfathered) would be shortened from Nov. 1 to Jan. 15 to Nov. 1 to Dec. 15, shaving a month off the open enrollment period.
Removing the low-income SEP
CMS would remove the special enrollment period (SEP) for individuals whose projected household income is at or below 150% of the Federal Poverty Level (FPL), allowing monthly enrollment or plan changes, from Federal and State exchanges to reduce adverse selection.
Requiring Pre-enrollment Verifications for SEP Applicants
CMS would remove the ability for applicants to self-attest that they qualify for a SEP due to a change of circumstance, and applicants would be required to submit documentation to the exchanges. All exchanges must verify at least 75% of new enrollments through SEPs.
Requiring Active Re-Enrollment
CMS would eliminate automatic re-enrollment for fully subsidized enrollees (those with a $0 premium after the Advance Premium Tax Credit (APTC)). These enrollees would be required to pay a $5 monthly premium until they update their exchange application and confirm their eligibility for the APTC.
Repeal of Bronze to Silver Plan Cross-Walking
CMS would repeal regulations allowing exchanges to move enrollees eligible for cost-sharing reduction from a bronze Qualified Health Plan (QHP) to a silver QHP for an upcoming plan year under certain conditions.
Updating De Minimis Thresholds
CMS would also change the permissible range of actuarial values for bronze, silver, gold, and platinum plans. For most plans, the range would become +2/-4 percentage points – where it was from 2018 to 2022.
Evidentiary Standard for Terminating Agents and Brokers
The proposed rule would revise the standard for the Department of Health and Human Services (HHS) to terminate for-cause agreements with agents, brokers, and web brokers from the federally facilitated exchange by adding a preponderance of the evidence standard of proof regarding issues of fact.
Excluding Deferred Action for Childhood Arrivals (DACA) recipients from the definition of lawfully present
DACA recipients would no longer be eligible to enroll in a QHP through an exchange, receive APTC and CSRs, or sign up for a Basic Health Program (BHP) in states that operate one.
Revising the Failure to File and Reconcile (FTR) process
Exchanges would be required to find enrollees ineligible for APTC after they or their tax filer has failed to file and reconcile their APTC for one tax year instead of two.
Removing the automatic 60-day extension to resolve income inconsistencies
This extension was in addition to the 90 days to provide income verification documentation.
Modifying income verification processes when data sources indicate income below 100% of the FPL and when tax data is unavailable
Requiring verification in more circumstances aims to improve program integrity.
What impact may these changes have on enrollment in 2026?
The Marketplace Integrity and Affordability Proposed Rule could significantly impact enrollment in the ACA Marketplace in 2026.
Here’s a breakdown of the anticipated effects:
Overall Reduction in Enrollment
CMS estimates that 750,000 to 2 million fewer individuals will enroll in health insurance plans on the Exchanges in 2026 due to the Proposed Rule.
Discouraging Enrollment
The rule includes measures expected to increase premiums, reduce Advance Premium Tax Credits (APTCs), and increase the administrative burden of applying and verifying enrollment. Many anticipate these factors will discourage individuals from enrolling and decrease eligibility.
What impact will specific provisions have on enrollment?
Many of the proposed rule provisions could negatively impact exchange enrollment. Here’s how:
Shorter Open Enrollment Period (OEP)
Some expect the proposed shortening of the OEP from Nov. 1 to Jan. 15 to Nov. 1 to Dec. 15 to influence enrollment timelines. While CMS doesn’t anticipate a negative impact on enrollment due to the maturity of enrollment systems, the shorter period could still affect individuals who tend to enroll later.
Removal of the low-income SEP
Many expect eliminating the special enrollment period (SEP) for individuals with incomes at or below 150% of the Federal Poverty Level (FPL) will reduce access to coverage for some low-income individuals, impacting enrollment.
Requiring Pre-enrollment Verifications for SEPs
The stricter verification requirements for SEP applicants likely will deter some eligible consumers from enrolling.
Requiring Active Re-Enrollment for Fully Subsidized Enrollees
The proposal to no longer automatically re-enroll individuals with a $0 premium after APTC without them taking action may lead to some individuals losing coverage if they are unaware of the need to actively re-enroll or choose not to pay the proposed $5 monthly premium.
Exclusion of DACA Recipients
CMS estimates the proposed exclusion of DACA recipients from the definition of “lawfully present” is projected to reduce annual QHP enrollment through the exchanges by approximately 10,000.
Changes to Failure to File and Reconcile (FTR) Process
The stricter FTR process, requiring reconciliation after one year instead of two, could lead to more individuals being deemed ineligible for APTC, potentially causing them to lose coverage.
Interaction with Expiring Subsidies
The proposed rule’s impact on enrollment in 2026 will also interact with the potential expiration of enhanced ACA subsidies, which could further decrease enrollment and increase the uninsured population.
What are the next steps?
The public comment period ends April 11, 2025. Interested parties, including insurers, marketplaces, healthcare providers, consumer advocates, and individuals, may submit comments on all aspects of the proposed rule.
After the comment period closes, CMS will review and consider all the submitted public comments. Due to the large volume of comments typically received, CMS will not acknowledge or respond to them individually.
Following the review of comments, CMS will likely issue a subsequent document, which would be the final rule. This document will likely include responses to the significant comments received in the preamble. The final rule will determine which proposed policies will be adopted and may incorporate modifications based on the feedback received.
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