CMS proposed a rule Oct. 23 that would require exchanges to verify eligibility before providing financial assistance to consumers.
CMS expects that its proposal would result in 332,500 fewer individuals on the exchanges each year. The proposed rule intends to follow HR 1 provisions and comes amid a broader push for integrity with the ACA and federal healthcare programs.
The rule comes days after a second trade group representing health insurance agents sued CMS over its ACA broker registration freeze, stemming from earlier rulemaking. CMS told Becker’s it does not comment on pending litigation.
Here are eight things to know from the new proposed rule:
- Starting in plan year 2028, when an applicant’s information cannot be confirmed electronically, exchanges would withhold advance premium tax credits and cost-sharing reductions until that inconsistent information is verified. This information includes income, family size, citizenship or immigration status, residency and other coverage. Some exceptions apply, such as when family size changes.
- Consumers could still enroll before verification is complete, though without subsidies. If consumers’ eligibility is verified and they have already enrolled in a health plan, they can get retroactive financial assistance.
- Starting Aug. 1, 2027, exchanges would give consumers the option to submit some eligibility information ahead of open enrollment.
- Exchanges would allow consumers to choose a contingent plan during open enrollment or a special enrollment period that would only become effective if the consumer gets the green light for financial assistance. The rule sets new start dates based on when verification is completed, and in some cases coverage could be retroactive.
- Starting in plan year 2029, CMS would move up the timeline for states transitioning to a state-based exchange, instead requiring applications to be submitted 15 months before the pre-open enrollment verification period rather than the open enrollment period.
- Beginning Aug. 1, 2027, current ACA enrollees would need to confirm their information annually to keep subsidies. Otherwise, they would be automatically renewed at full price.
- With the expectation that 332,500 people would leave the market, CMS estimates a 0.4% premium increase.
- CMS specifically asked insurers to weigh in on the operational challenges of applying subsidies and cost-sharing reductions retroactively.
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