On February 9, the Centers for Medicare and Medicaid Services (CMS) released its latest proposed Notice of Benefit and Parameters (NBPP). The NBPP is released every year, creating rules that can have a big impact on state insurance markets. If passed, these changes are set to take effect January 2027.
If passed as proposed, CMS estimates that health insurance Marketplace enrollment will decrease by 1.2 – 2 million individuals, and health insurance premiums will increase by 2-3 percent.
As proposed, the NBPP would have significant impact on insurance exchanges by:
- Changing how individuals can enroll in plans.
- Changing the cost of insurance – premiums and out-of-pocket-costs.
- Changing who is eligible to buy insurance through the exchanges.
- Changing the types of plans that can participate in the exchanges.
- Encouraging more states to prioritize state-based marketplaces over federal marketplaces.
Major Policies Proposed for the 2027 Plan Year
New Insurance Plan Options
Catastrophic Plans
- Bronze and catastrophic plans would have new cost-sharing rules.
- Higher out-of-pocket limits: $15,600 (individuals) and $27,000 (families).
- Offer plans for up to 10 years
CMS’s Reasoning: CMS believes these plans will be cheaper over time. They expect the plans to be used mainly by healthier people who do not expect to use many medical services.
Potential Concerns:
- These plans still require a monthly premium but cover very little.
- They do not qualify for premium tax credits (APTCs).
- People who are eligible for APTCs might choose these plans anyway and miss out on more affordable, comprehensive options
“Non-network” Plans
- Plans without provider networks could become qualified health plans (QHPs) starting in 2027.
CMS’s Reasoning: CMS says these plans must show they offer enough access to providers who accept the plan’s payment as full payment. This includes:
- Essential community providers (serving low‑income and underserved groups)
- Mental health and substance use disorder providers
Services must be available without unreasonable delays.
Potential Concerns:
- CMS has not explained how it will measure provider access without a network.
- There are no strong protections allowing consumers to switch plans if the plan no longer meets their needs (i.e. cancer diagnosis).
Implementation of the HR1 “The One Big Beautiful Bill”
Section 71301 (Starting 2027): Advanced premium tax credits (APTCs) would be limited to certain groups of lawfully present immigrants:
- Permanent residents
- Individuals from the Republic of Cuba
- Individuals living in the U.S. under a Compact of Free Association
Additionally, basic health programs are not allowed to cover ineligible individuals.
Section 71302 (Starting 2026): Lawfully present immigrants with incomes below 100% of the federal poverty level (FPL) would no longer qualify for APTCs.
Section 71303 (Starting 2028):
- Auto-enrollment and provisional enrollment ends.
- APTCs are not available unless the consumer’s eligibility is fully verified.
- Exchanges must determine whether a tax filer or enrollee is ineligible for APTCs.
Section 71304 (Starting 2026):
APTCs are not available for people who enroll through the monthly Special Enrollment Period (SEP) because their expected income meets criteria set by HHS. APTCs are still available if their enrollment is tied to a qualified life event.
CMS also proposes ending the 150% FPL SEP after 2026.
Re-Introduction of Policies from the 2025 Marketplace Integrity and Affordability Final Rule
Special Enrollment Period (SEP) Verification
- Federal marketplace exchanges would require pre-enrollment SEP verification.
- Allows for verification of more SEPs beyond loss of minimum essential coverage.
- At least 75% of new SEP enrollments must be verified.
Income Verification
- Consumers below 100% of the federal poverty level (FPL) must verify their income.
Attestation of Household Income
- Exchanges no longer have to accept self-attested income when IRS data is missing
- If passed, the change would be permanent starting in 2027.
Agents, Brokers, and Web-Brokers Rules
- Agents, brokers, and web-brokers must HHS’s standard consent form.
- Consumers must clearly confirm consent (signature, email, voice recording, etc.)
- CMS will create a list of prohibited marketing practice.
- Agents, brokers, and web-brokers must provide marketing materials to CMS if requested.
- CMS ends the vendor training program; training is still available on the CMS Marketplace Learning Management System (LMS).
State-Based Exchange Flexibilities
Direct Enrollment Action
- States could choose to rely entirely on web-brokers to run enrollment websites.
Potential Concerns: Private sites might not offer standardized tools for comparing plans, which could lead consumers towards plans that do not fit their needs.
Transitioning from a Federally Facilitated Exchange (FFE) to a State-Based Exchange (SBE)
- CMS proposes
- Removing the requirement that states operate for one year as an SBE on the federal platform before becoming a full SBE.
- Removing the requirement that states submit documentation showing progress towards SBE readiness.
CMS’s Reasoning: CMS believes that this would remove delays and make it easier for states to run their own exchanges.
Exchange Network Adequacy Standards
- CMS would remove strict time-and-distance standards. Instead, states would ensure that plans offer enough provider choice based on local needs.
Program Integrity and Improper Payments
- CMS proposes
- Creating a program to measure improper payments in state-based exchanges (SBE).
- Requiring states to give CMS access to exchange data (eligibility and enrollment).
- Requiring corrective action plans for states with high improper payment rates.
For more detailed breakdowns of the changes
Encourage confidence to act
