ACA marketplace final rule could add to payer-mix concerns for providers

In new regulations setting coverage parameters for Affordable Care Act (ACA) marketplace health plans, CMS is attempting to intertwine increased program integrity with greater flexibility for states and insurers.

The balancing act is part of an effort to fortify the marketplaces in a year when enrollment already has fallen by more than 1 million after expiration of the enhanced subsidies for buying coverage. The final 2026 numbers are expected to show a greater drop-off when accounting for people who were automatically reenrolled but then dropped out after failing to pay their initial premium.

In the newly issued 2027 final rule, CMS estimates a 2026 enrollment of 18.9 million, down from 24.3 million in 2025. The policies described in the rule are projected to result in a further decrease of between 1.2 million and 2 million in 2027, relative to a baseline number.

Due to the enrollee exits, premiums will rise by between 1.7% and 2.4%.

“Many enrollees will discontinue coverage when stronger eligibility verifications identify they are no longer eligible for subsidies, and we believe it is likely that healthier enrollees are more likely to discontinue coverage,” CMS wrote in the rule.

“The expected worsening of morbidity in the market is offset by protecting against adverse selection with pre-enrollment SEP [special enrollment period] verification, removal of the SEP for those under 150% [of the federal poverty level], and a reduction in exchange user fee charges.”

A direct link between the user fees charged to ACA marketplace insurers and adverse selection (i.e., an increased share of enrollment by people who are less healthy) isn’t clear. Reduced fees may allow insurers to lower their premiums and thus attract healthier enrollees.

Notable shifts in the ACA marketplaces

CMS’s updated enrollment estimate for 2026 is still significantly higher than the enrollment tally of 12 million going into 2021, the year the enhanced subsidies were introduced. But a related issue that has implications for the payer mix at healthcare providers is the reportedly substantial migration of enrollees from silver plans to bronze plans. That issue affected the Q1 financial reporting of major for-profit health systems.

Plan choice in the ACA marketplaces likely will be more constrained a year from now. Cigna announced it would exit the marketplaces in 2027, citing enrollment decreases and market instability. Aetna did the same going into 2026, displacing roughly 1 million enrollees.

Cigna’s 2026 enrollment is 369,000, down more than 75,000 from the year prior.

“This is small business for us today, and it’s been shrinking in recent years,” Brian Evanko, Cigna’s president, said during a recent earnings call.  

Fraud prevention prominent in the ACA final rule

Among various program integrity measures in the final rule (some pertaining to marketing practices of agents and brokers), CMS finalized the continued elimination of the SEP for people with income below 150% of federal poverty. Previously, the SEP had been tabled for 2026.

Provisions also require insurers to implement stronger verification processes for the remaining SEPs (e.g., SEPs for loss of health insurance, getting married or divorced).

“This policy will ensure more consistent application of eligibility criteria and reduce instances of improper enrollments, which can lead to a more balanced risk pool and potentially lower premiums, benefiting consumers,” CMS wrote in a fact sheet.

Enrollees who fail to reconcile their subsidies on their tax return can be rendered ineligible for subsidies after one year as of 2027, rather than after two consecutive years of noncompliance under current regulations. The change is optional for marketplaces in 2027 and mandatory starting in 2028.

The final rule also implements One Big Beautiful Bill Act (OBBBA) provisions to limit the categories of immigrants who can receive subsidies and cost-sharing reduction (CSR) payments. In addition, lawfully present immigrants with income below 100% of FPL have been made ineligible for subsidies if they are also ineligible for Medicaid.

Note: The final rule refers to the OBBBA as the Working Families Tax Cut (WFTC) legislation, the preferred name of the Trump administration.

Non-network plans will be permissible in the ACA marketplaces

CMS seeks to expand the suite of available ACA plans, in part by allowing non-network plans to join starting in 2028. Such plans do not have a provider network but instead set reimbursement amounts for consumers to use in shopping for providers.

The plans must meet thresholds for ensuring healthcare availability, including access to designated essential community providers (ECPs) and providers that offer care of mental health and treatment for substance-use disorders.

“This policy aims to reduce overall healthcare costs by (1) empowering enrollees to utilize price transparency information to shop for lower prices and negotiate directly with providers, thus fostering increased competition, and (2) eliminating substantial administrative overhead associated with traditional network management, potentially resulting in lower premiums,” CMS wrote.

It remains to be seen whether provider participation in such arrangements is comparable to the level seen in a traditional network. In addition, consumers may be vulnerable to balance billing and higher out-of-pocket costs without access to insurer-negotiated discounts.

The non-network health plan concept poses concerns, the Federation of American Hospitals (FAH) said in written remarks on the final rule.

“Plans built around high deductibles and narrow — or even non-existent — provider networks can put care further out of reach,” said Charlene MacDonald, FAH president and CEO.

Other steps to increase ACA plan variety

Finalized provisions for catastrophic plans allow for a term of up to 10 years, rather than requiring reenrollment each year (auto-reenrollment in metal-tier plans is restricted starting in 2028 under the OBBBA). The rule also codifies previously issued guidance expanding eligibility for catastrophic plans to anyone who does not qualify for subsidies or CSRs based on income, regardless of their age.

Catastrophic plans with terms spanning at least two years can also implement value-based insurance design to enhance pre-deductible coverage.

Insurers have been granted increased flexibility in plan design in the 30 federally facilitated marketplaces, with CMS eliminating the requirement for standardization around cost-sharing formats. Under current rules, insurers have had to offer at least one standardized plan within each ACA metal tier and each network type (e.g., HMO, PPO) in which they participate.

That obligation is being dropped, although parameters remain regarding actuarial value.

Provider-related provisions in the ACA final rule

The proposed version of the rule had floated the idea of reducing the share of designated ECPs with which an ACA marketplace plan must contract in its service area. However, no such change is being made, and the threshold remains at 35% instead of dropping to 20%.

A degree of oversight of ACA network adequacy is shifting to the states, which now have the option to conduct their own reviews of provider-access compliance and ECP certification.