The Department of Health and Human Services (HHS) announced Thursday it would expand access to more affordable catastrophic health coverage through its new hardship exemption guidance. Until now, consumers under the age of 30 were eligible for the plans through HealthCare.gov.
The new guidance will allow more Americans, who are ineligible for advance payments of the premium tax credit (APTC) or cost-sharing reductions (CSRs), to qualify for the catastrophic health coverage based on need. The guidance will take effect November 1 with the start of open enrollment.
Catastrophic plans are less expensive plans that provide all essential health benefits required under the Affordable Care Act, including full access to preventive services without cost-sharing. They are designed to protect consumers against serious illness or injury scenarios that could result in expensive medical expenses.
Centers for Medicare & Medicaid Services (CMS) Administrator Dr. Mehmet Oz said in the announcement that expanding access to the catastrophic plans will ensure people who face unexpected hardships can get affordable coverage that protects them from expensive medical costs.
In a fact sheet, CMS said the hardship exemption is specifically designed to help consumers access coverage as a result of the premium increases anticipated for the 2026 plan year. Americans may qualify for a hardship exemption to purchase a catastrophic plan on or off the marketplace exchange if they are ineligible for APTC or CSRs based on their projected annual household income. The department said it will also streamline the review of paper applications to reduce the administrative burden on consumers.
Beginning November 1, consumers can apply for the hardship exemption by either:
- Applying online for marketplace coverage on HealthCare.gov or through a certified partner. Household income will be reviewed as part of the application process.
- Submitting a hardship exemption form by mail.