New Proposed Rule by CMS To Reduce Improper Enrollments in ACA

On March 10, the Centers for Medicare & Medicaid Services (CMS) released a proposed rule to address the number of improper enrollments impacting the Affordable Care Act (ACA) Health Insurance Marketplaces. 

The CMS’ 2025 Marketplace Integrity and Affordability Proposed Rule includes proposals that take steps to protect people from being enrolled in Marketplace coverage without their knowledge or consent, promote stable and affordable health insurance markets, and ensure taxpayer dollars fund financial assistance only for the people the ACA set out to support. 

According to a press release by CMS, “After the 2023 benefit year closed, CMS began receiving a dramatic uptick in complaints from consumers who claimed they had been enrolled in Marketplace coverage without their consent. Research suggests 4 to 5 million people were improperly enrolled in subsidized ACA coverage in 2024, costing federal taxpayers up to $20 billion.”

If finalized, the rule would reduce the open enrollment period for all marketplaces to Nov. 1 through Dec. 15. Additionally, the availability of the monthly special enrollment period (SEP) for individuals with household incomes below 150 percent of the federal poverty level (FPL) would end, a policy that currently allows people to wait to enroll until they become sick instead of promoting continuous enrollment.

The proposed policies would reinstate policies formerly finalized during the prior Trump administration. CMS proposes a policy that would add sex-trait modification to the list of items and services that may not be covered as essential health benefits beginning in plan year 2026.

In line with Trump’s Executive Order on Ending Taxpayer Subsidization of Open Borders, the proposed rule would also revert to a previous definition of “lawfully present” that excludes Deferred Action for Childhood Arrivals (DACA) recipients for purposes of enrolling in Marketplace coverage.