Lower Premiums
The Centers for Medicare & Medicaid Services (CMS) has published a final rule that addresses various issues involving the Patient Protection and Affordable Care Act (ACA), as well as “marketplace integrity and affordability.” According to a June 20 CMS press release, the final rule will act as a substantial tool in helping the government to crack down on improper ACA enrollments, protect patient and taxpayer dollars, and restore marketplace integrity.
A primary effect that the government expects to come out of this 500-page rule is a lowering of individual health insurance premiums by approximately 5%. CMS projects the measure to save taxpayers up to $12 billion in 2026 “by combating the surge of improper enrollments in the Affordable Care Act (ACA) Exchanges, reining in wasteful federal spending, and refocusing on making health insurance markets more affordable and sustainable for hardworking American families.” U.S. Health and Human Services (HHS) Secretary Robert F. Kennedy, Jr. stated “With this rule, we’re lowering marketplace premiums, expanding coverage for families, and ensuring that illegal aliens do not receive taxpayer-funded health insurance.”
Impetus for Action
According to the CMS press release, improper ACA enrollments, enabled by weakened verification processes and expanded premium subsidies, have triggered widespread fraud. The agency’s research data has revealed that, in 2024 alone, an estimated 5 million people may have been improperly enrolled, costing taxpayers as much as $20 billion. Here’s how CMS Administrator Dr. Mehmet Oz assessed the reasons behind the recently released final rule:
CMS is restoring integrity to ACA Exchanges by cracking down on fraud, protecting American taxpayer dollars, and ensuring coverage is there for those who truly need it. This is about putting patients first, stopping exploitation of the system, and realigning the program with the values of personal responsibility and fiscal discipline.
Evidently, then, the new CMS administrator and HHS secretary have detected evidence of large-scale fraud, waste and abuse of the healthcare system and are endeavoring to right the ship. And we’re told that these efforts, as memorialized in this final rule, will save Americans money. We look forward to seeing if these laudable goals will ultimately be achieved. In the meantime, what else does the final rule seek to do?
Other Objectives
A review of some additional details found in the final rule reveals that CMS will be addressing improper enrollments by utilizing the following means:
- Repealing the monthly special enrollment period (SEP) for individuals with projected household incomes at or below 150% of the federal poverty level, a policy used by some agents and brokers to improperly enroll ineligible consumers and perform unauthorized plan switching to gain commissions
- Requiring income verifications to ensure people qualify for the premium subsidies they receive
- Conducting eligibility verifications for the majority of enrollments through SEPs, closing loopholes that allowed people to wait to enroll until they needed care and improving the risk pool, which can lower premiums for middle-class families not receiving subsidies
- Reducing advanced payments of the premium tax credit (APTC) by $5 a month for individuals who are automatically re-enrolled in fully-subsidized plans without eligibility verification
- Standardizing the Annual Open Enrollment Period starting with the 2027 plan year so that it ends by December 31 for all health insurance exchanges
A number of the policies CMS is finalizing are temporary measures to immediately tamp down on improper enrollments and the improper flow of federal funds. These policies will sunset at the end of the 2026 plan year.
Finally, the rule contains measures to ensure federal subsidies for coverage through ACA Exchanges only support the statutory requirements and goals of the ACA. For example, the rule prohibits federal subsidies from being used to help cover the cost of specified sex-trait modification procedures and reinstates the department’s 2012 interpretation of “lawfully present” to exclude Deferred Action for Childhood Arrivals (DACA) recipients from eligibility and enrollment in ACA Exchange coverage and Basic Health Program (BHP) coverage.
The full text of the final rule can be downloaded from the Federal Register at https://www.cms.gov/files/document/cms-9884-f-2025-pi-rule-master-5cr-062025.pdf