ACA marketplace subsidy verification rule would reduce enrollment starting in 2028

Proposed annual verification processes for Affordable Care Act (ACA) marketplace insurance subsidies could prove disruptive to returning enrollees.

A CMS proposed rule would implement provisions of H.R. 1 (also known as the One Big Beautiful Bill Act or the Working Families Tax Cut Act) starting with 2028 open enrollment. An enrollee applying for subsidies with which to buy marketplace insurance would have to annually reconfirm certain eligibility information, and the information would need to be verified before the enrollee could receive financial assistance for a given plan year.

Failure to take that step would allow the enrollee’s ACA coverage to still be automatically renewed, but without subsidies (also known as advance premium tax credits, or APTCs) or income-based cost-sharing reductions (CSRs). Those enrollees thus would face higher premiums and care costs.

What ACA subsidy eligibility verification would require

Information that would be subject to verification includes income, family size, citizenship or immigration status, residency, other coverage and employer coverage. Subsidies and CSRs would not be payable until discrepancies are resolved, whereas under current regulations, subsidies remain available for a three-month period as long as the enrollee is otherwise eligible.

The new restrictions would be waived for special enrollment periods (SEPs) involving births, adoptions, marriages and the loss of a dependent through divorce, separation or death. Consumers in those scenarios could receive subsidies based on attested information while verification is pending.

CMS also clarifies that when an enrollee reports a mid-year change to verified eligibility information, subsidies would not necessarily be interrupted during subsequent verification. If the reported change would increase financial assistance, the enrollee would continue receiving the previously verified amount until the new information is substantiated. Conversely, if the change would reduce assistance, the ACA marketplace could lower the amount based on the enrollee’s newly reported information, even before verification is completed.

Among specific areas in which CMS seeks stakeholder input is on ways to verify household size and residency, including the applicable data sources. A 30-day comment period on the proposed rule begins at regulations.gov once the rule is formally published in the Federal Register, scheduled for Oct. 27.

Early verification and enrollment options could ease transitions

ACA plan applicants would have the option to submit the required information in an early verification window beginning Aug. 1 going into each plan year. Consumers could use that window to resolve documentation issues ahead of open enrollment.

Consumers who enroll in an ACA plan while their verification is pending could have their subsidy applied retroactively once their eligibility has been substantiated, according to the proposed rule.

Another accommodation for enrollees would require ACA marketplaces to let consumers select a contingent plan during open enrollment or an SEP while their subsidy eligibility is being corroborated. The coverage would become effective if the consumer is deemed eligible for financial assistance, even if the enrollment period has ended, according to a fact sheet on the proposed rule.

CMS says the provision would address scenarios where a consumer ultimately is subsidy-eligible but hesitates to enroll in the period after being quoted the unsubsidized premium.

CMS expects further declines in ACA marketplace enrollment

Among impacts of the proposed rule, CMS projects a 2028 enrollment drop of 332,500 relative to a baseline of 16.9 million. The baseline itself is a decrease from 19.2 million as of February 2026, the first year since 2021 when enhanced subsidies were not available. In February 2025, enrollment was between 21.8 million and 22.1 million, depending on which government source (CMS or the HHS Assistant Secretary for Planning and Evaluation) is referenced.

Enrollment undoubtedly has fallen since the early-2026 number was released, said Louise Norris, an analyst with Healthinsurance.org. Ongoing impacts vary from state to state, especially since some states offer their own subsidies to supplement the federal APTCs. In Mississippi, which does not have state-level subsidies, a recent disclosure from the insurance commissioner revealed a year-over-year drop of more than 60% as of August 2026.

“We could be down as low as 16 million by now,” Norris said. “It’s just hard to know.”

The Trump administration has said program-integrity efforts are driving large shares of the ongoing cuts. Some of CMS’s anticipated reduction between the 2026 reported total and the 2028 projected baseline, for example, can be attributed to steps such as a recent paring of 760,000 enrollments that were assessed to be fraudulent. As part of the same investigation, the agency is evaluating 420,000 additional enrollments.

Lower enrollment could increase premiums and hospital financial risks

Federal spending on ACA subsidies would fall by roughly $7.6 billion per year, including $2.6 billion from a reduction in enrollees and $5 billion associated with verification delays, according to the proposed rule. Premiums would rise by $2.89, or 0.4%, per member per month.

CMS also acknowledges that qualitative effects from attrition in coverage potentially would include delayed access to care and deterioration in the risk pool, with “lower motivation among healthy and younger individuals to complete the required administrative steps,” the proposed rule states.

“Overall, more individuals may lose coverage because they are unlikely to be able to afford to enroll in a full-price QHP [qualified health plan] while they complete the verification process, leading to an increase in the rate of uninsurance,” the rule states. “This increase may impose greater burdens on the healthcare system as treatment may shift to under-prepared emergency departments.”

The agency asks for comments about prospective impacts such as “effects on premiums, burdens on the healthcare system, and effects on Federal spending due to shifts from individual market coverage to Medicaid coverage or uncompensated care.”