CMS Proposes New Regulations to Cut Costs and Expand Coverage Options for 2027
CMS issues policies to reduce health care expenses, increase consumer choice, and safeguard taxpayers.
As of today, the Centers for Medicare and Medicaid Services (CMS) offered regulations to reduce healthcare costs, competition, and enhance program integrity within the Federal and State-Based Health Insurance (Exchanges). The 2027 Notice of Benefit and Payment Parameters would crack down on fraud and misleading practices in the agent and broker industry, would reform accountability over taxpayer-funded subsidies, would eliminate federal barriers that have hindered plan innovation and increased premiums, and would help ensure coverage is more affordable and works better in serving consumers, taxpayers, and states. The overall goal is to make Exchange coverage more affordable and more effective for consumers, taxpayers, and states.
“At President Trump’s direction, HHS is focused on reducing costs and eliminating fraud across our health insurance programs,” said Health and Human Services Secretary Robert F. Kennedy, Jr. “This proposal is intended to lower premiums, increase consumer options, crack down on fraud, and support coverage designs that emphasize prevention and long-term health.”
This proposal places patients, taxpayers, and states at the forefront, therefore reducing costs and strengthening accountability on taxpayer funds, said CMS Administrator Dr. Mehmet Oz. We are cracking down on inappropriate and deceptive practices and providing states and health plans with more space to be creative and competitive. The objective is not complicated: reduced prices, increased options, and exchanges that are functioning as intended.
Innovation in the Design of Plans.
The rule suggested promotes new, consumer-oriented plan designs, enlarging choice and facilitating affordability. If finalized, the rule would:
- Allow catastrophic plans to run for one year or renew for multiple consecutive years, up to 10 years total.
- Remove standardized plan options and related limits, giving insurers more freedom to build plans around consumer needs.
- Let some low-deductible plans pair lower deductibles with higher maximum out-of-pocket limits, widening affordable plan formats.
- Better align affordability and coverage rules across catastrophic and metal-tier plans.
- Expand hardship exemptions for eligible adults age 30+ in every state, increasing access to catastrophic coverage.
- Permit certain non-network plan models to qualify as QHPs if they can prove consumers still have sufficient provider options.
Strengthening Integrity and Accountability
CMS is also proposing tougher eligibility and income verification requirements, along with stronger enforcement, to ensure premium subsidies are provided only to eligible individuals. The agency says expanded income checks would help reduce improper enrollments, prevent unauthorized plan changes, and limit fraud across the exchanges. The proposal also updates Exchange policies to reflect legal requirements that restrict eligibility for premium tax credits, cost-sharing reductions, and advance payments of those benefits to individuals who meet immigration eligibility standards, and it would require Exchanges to verify that eligibility.
Another effect of the proposed rule is that it enhances the standards of behavior of insurance agents, brokers, and web brokers by illuminating the unacceptable marketing activities and promoting supervision to discourage fraud and deceptive behaviors. The following measures will help strengthen the trust people have in the exchanges and safeguard consumers against malicious entities.
Steps Aimed at Lowering Premiums and Improving Affordability
CMS also suggests modifications to make the Exchange policy more consistent with statutory intent and responsive to important cost drivers, such as:
- Reintroducing fiscal discipline on Essential Health Benefits to guarantee that federal subsidies are not utilized to fund state-mandated benefits that raise costs to consumers and taxpayers alike.
- Modernizing network adequacy and provider access reviews to enhance transparency but eliminate duplicate oversight.
These reforms will help reduce premiums and provide greater access, while giving consumers more control over their health coverage.
The Trump administration continues to fulfill its commitment to independent, competitive, and affordable health insurance markets and hold federal programs accountable with integrity. CMS is open to the feedback of the public on the proposed rule and anticipates collaboration with the states, issuers, agents, brokers, and interested parties to conclude on the policies that place patients and taxpayers in the first place.
To check out the proposed rule, visit https://www.federalregister.gov/d/2026-02769.
Public comments must be submitted by March 11, 2026.
To review the proposed rule fact sheet, visit https://www.cms.gov/newsroom/fact-sheets/hhs-notice-benefit-payment-parameters-2027-proposed-rule.
