The Centers for Medicare & Medicaid Services (CMS) on Monday released an extensive proposed rule for the 2027 plan year it says would lower premiums, increase health plan flexibility and reinforce the integrity of the health insurance exchanges.
The Notice of Benefit and Payment Parameters for 2027, which is scheduled to be published in the Federal Register on Wednesday, outlines changes that would affect insurers, state exchanges, brokers, and the millions of Americans who rely on Affordable Care Act (ACA) marketplace coverage. CMS will accept public comments on the proposal through March 11.
Among the key proposed changes:
Expand plan design
CMS wants to promote innovation in plan design to increase affordability and encourage competition. The agency wants to broaden consumer choice by:
- Allowing catastrophic plans to offer multi‑year terms of up to 10 years—a significant shift intended to create incentives for insurers to invest in long‑term enrollee health and potentially stabilize premiums.
- Eliminating standardized plan options and related limits, giving insurers more flexibility in plan design.
- Letting low‑deductible plans with higher out‑of‑pocket maximums to deliver more affordable options.
- Certifying non‑network plans as qualified health plans (QHPs) if they can demonstrate sufficient provider choice, potentially reducing administrative overhead and fostering price transparency.
Strengthen oversight
CMS aims to take a more aggressive posture on fraud prevention and consumer protection. The proposed rule calls for enhanced eligibility verification and stronger oversight of agents, brokers, and web brokers.
The changes would involve:
- Additional income and immigration‑status verifications to ensure subsidies go only to eligible individuals.
- Clear examples of prohibited misleading marketing tactics, such as promising zero‑premium plans without basis or offering cash incentives for enrollment.
- Requirements for standardized Department of Health and Human Services‑approved forms for eligibility application reviews and consumer consent to reduce unauthorized enrollments.
- Implementation of a state exchange improper payment measurement program that would expand improper‑payment oversight to state‑based exchanges.
Address health care costs and improve affordability
CMS seeks to reduce premium costs and increase transparency around what drives them. To do so, the agency wants to restore fiscal discipline around essential health benefits by prohibiting federal subsidies from covering state‑mandated benefits added after 2011 unless states cover their cost.
CMS also proposes to:
- Update network adequacy standards to reduce duplicative oversight and improve transparency.
- Expand hardship exemptions for individuals aged 30 and older, allowing more people experiencing income changes to enroll in catastrophic coverage.
- Revise cost‑sharing parameters for catastrophic and bronze plans to better align with affordability goals.
Enhance state flexibility in exchange management
CMS proposes giving states more autonomy in exchange operations. States would be allowed to conduct their own provider access and essential community provider certification reviews if they have sufficient technical capacity.
Other state‑focused provisions include:
- Eliminating the requirement for states moving from the federal exchange to operate for a year on the federal platform, easing transitions to state-based exchanges.
- Creating an “Enhanced Direct Enrollment” model that would let states rely exclusively on private web‑brokers instead of maintaining centralized state enrollment websites.
Refine subsidy eligibility requirements
To align with recent federal law, CMS proposes tightening subsidy eligibility rules, including requiring verification of “eligible noncitizen” status beginning in 2027. It also seeks to end APTC eligibility for certain lawfully present individuals with incomes below 100 percent of the federal poverty level if they are ineligible for Medicaid because of immigration status.
Other subsidy‑related changes would reintroduce requirements for income verification when tax data is unavailable and strengthen tax filing and reconciliation rules.