A coalition of cities, physicians and small businesses are challenging recently finalized changes to the ACA marketplace they argue will cause at least 3 million people to lose health coverage, marking the latest in a series of legal challenges to CMS rulemaking around the program.
The complaint, filed June 3 in the U.S. District Court for the District of Maryland, targets a broad set of changes to the marketplace that CMS finalized in late May, including income verification requirements for low-income enrollees and relaxed network adequacy standards. The coalition is made up of the cities of Columbus, Ohio; Chicago; and Baltimore; Pima County, Ariz.; physician advocacy organization Doctors for America; and Main Street Alliance, a small business network.
“The Trump-Vance administration returns yet again with another ‘death by a thousand paper cuts’ approach to the ACA,” the plaintiffs wrote. “Cloaked in the pretense of government efficiency and fraud prevention, the 2026 rule creates numerous barriers to affordable insurance coverage, negating the ACA’s goal of extending affordable health coverage to all Americans, and instead increasing the population of underinsured and uninsured Americans.”
The lawsuit alleges that more than a dozen provisions within the latest rule violate the ACA and the Administrative Procedure Act, including a policy that would strip advance premium tax credit eligibility from enrollees in the first year rather than providing a grace period, along with income verification requirements for low-income enrollees that courts have previously rejected.
The group is also challenging the expansions of out-of-pocket maximums for bronze plans and catastrophic plan eligibility requirements, the addition of non-network plans beginning in 2028, and elimination of the requirement that insurers offer standardized plan options on the exchange.
CMS’s own projections estimate up to 2 million additional enrollees will drop coverage in 2027 and that premiums will rise by as much as 2.4% as a result of the challenged provisions. The rule is set to take effect July 20.
In August, a Maryland federal judge issued a preliminary injunction blocking several provisions of a 2025 rule from CMS that would have restricted enrollment and tightened eligibility verification on the exchanges. A separate challenge filed by 21 states last July also targets the 2025 rule and is ongoing.
Total marketplace enrollment has declined to 23.1 million in 2026 from more than 24 million last year following the expiration of enhanced premium tax credits, and the share of enrollees in bronze plans has increased from 30% to 40% as healthier consumers have shifted toward cheaper coverage or left the market entirely.
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