CMS finalizes changes to ACA Exchange eligibility process

The Trump Administration has finalized a rule that would impose significant changes to the Affordable Care Act Exchanges in a move it says will combat a "surge of improper enrollments," the Centers for Medicare and Medicaid Services announced Friday evening.

The 2025 Marketplace Integrity and Affordability Final Rule solidifies a number of provisions that alter how individuals enroll on the Affordable Care Act (ACA) insurance exchanges, with the end goal of lowering individual health insurance premiums by an average of 5%. The provisions would also have coverage consequences, with CMS projecting between 725,000 and 1.8 million people would lose coverage.

However, the agency did stress its goals to weed out "waste, fraud and abuse" as a part of this final rule.

"We are strengthening health insurance markets for American families and protecting taxpayer dollars from waste, fraud and abuse," said U.S. Health and Human Services Secretary Robert F. Kennedy, Jr. "With this rule, we're lowering marketplace premiums, expanding coverage for families and ensuring that illegal aliens do not receive taxpayer-funded health insurance."

Particularly, CMS stated that there has historically been a weak verification process and too many expanded premium subsidies, which have led to what it called fraud. Citing figures from Paragon Health Institute, a conservative thinktank, CMS stated that there were an estimated 5 million people who might have been improperly enrolled on the ACA Exchanges, creating a $20 billion price tag for taxpayers.

"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," said CMS Administrator Dr. Mehmet Oz. "This is about putting patients first, stopping exploitation of the system and realigning the program with the values of personal responsibility and fiscal discipline."

More specifically, the rule implements the following provisions:

• Removing the monthly special enrollment period (SEP) for those with projected household incomes at or below 150% of the federal poverty level.
• Mandating income verification, which the administration says will ensure people qualify for the subsidies they receive.
• Performing eligibility verification for "the majority" of enrollments through SEPs, which the agency said will close "loopholes that allowed people to wait to enroll until they needed care."
• Reducing advanced payments of the premium tax credit by $5 monthly for those who are auto re-enrolled in fully subsidized plans without eligibility verification.
• Creating a standard Annual Open Enrollment Period starting with the 2027 plan year, ending the period on December 31 for all health insurance exchanges. The agency states that this will prevent people from waiting until they get sick to enroll.

The agency indicated that many of these policies are likely temporary measures slated to sunset at the end of the 2026 plan year.

CMS also stated that the rule prohibits federal subsidies from being used to cover some or all of the cost of gender-affirming care. Furthermore, it prohibits Deferred Action for Childhood Arrivals (DACA) recipients from being eligible for ACA Exchange coverage or Basic Health Program coverage.

Sara Heath has reported news related to patient engagement and health equity since 2015.