CMS releases final ACA marketplace payment notice for 2026

CMS has released the 2026 ACA marketplace parameters, touching on enrollment, plan choice, transparency, the HHS risk adjustment program and more, according to a fact sheet on the HHS Notice of Benefit and Payment Parameters for 2026 Final Rule that Healthcare Payers received by email.

"The rule finalizes additional safeguards, beginning in 2026, to protect consumers from unauthorized changes to their health care coverage, as well as options to ensure the integrity of the Federally-facilitated Marketplaces (FFMs)," the emailed fact sheet explained. "Additionally, the rule will make it easier for consumers to understand their costs and enroll in coverage through HealthCare.gov beginning in plan year 2026."

CMS recalibrated the risk adjustment models for the Affordable Care Act (ACA) marketplace in 2026. The agency will include HIV PrEP drugs -- not including generic drugs -- as a distinct risk factor for both adults and children. Hepatitis C drugs will phase out of its market pricing adjustment to the plan liability. The agency removed and replaced certain populations in the initial validation audit and made some changes to the second validation audit calculations. Additionally, the final rule set a financial impact threshold on rerunning HHS Risk Adjustment Data Validation.

Cost-sharing reduction (CSR) loading, also known as "silver loading," will continue to be protected as a practice, but CMS inserted some stipulations in this finalized HHS Notice of Benefit and Payment Parameters. There are two types of CSRs: decreasing annual cost-sharing limits and lowering cost-sharing requirements. In CSR loading, plans raise the premium of one plan -- specifically, a silver plan -- to help cover other silver plans on the Affordable Care Act marketplace. CMS specified that this practice is permissible when carried out according to state law using accurate actuarial evidence.

Enforcing transparency is important for all stakeholders, including both health plans and consumers. To that end, CMS added that it will release state marketplace operations data, which should help inform stakeholders about customer service quality, outreach spending and other important data points. The agency will also start sharing Quality Improvement Strategy updates yearly so that the public can be aware of ACA marketplace quality-related efforts. However, State Marketplaces' State-based Marketplace Annual Reporting Tools will not be publicly available, contrary to what was suggested in the proposed rule.

For plan choice, CMS finalized updates to the actuarial value requirements and affirmed that health plans with more than one standardized plan option that share certain characteristics must be clearly distinct from each other from the consumer's perspective. Additionally, plans will have flexibility on whether they will offer adult and child dental and adult vision coverage to promote more differentiation.

The agency also sought to simplify enrollment processes. For individuals who are eligible for advanced premium tax credits (APTCs) or who could lose eligibility if they fail to file their federal income taxes, Marketplaces will be required to send notifications for up to two years to ensure that consumers are aware that they may lose their APTCs. The Basic Health Program (BHP) will also undergo some updates. CMS finalized a new process for calculating premium adjustment factors when a BHP has not been fully executed, and new calculations for BHP payment rates in areas with more than one second-lowest-cost silver plan.

To advance health equity and protect consumers from unnecessary costs, the agency finalized a fixed-dollar or percentage-based premium payment threshold and medical loss ratio (MLR) reporting changes. Issuers will be allowed to retain coverage even when they have not paid their full premium. Plans can do this either by establishing a dollar limit (as high as $10) or a percentage (either net or gross premium threshold) and permitting consumers to retain coverage if they meet that amount after the APTC has been applied. Thus, consumers will avoid entering a grace period and jeopardizing their coverage.

Under the new MLR policy, payers can allow their net risk adjustment receipts to impact the MLR denominator instead of the numerator.

"This policy supports plans with unique business models that focus on underserved communities whose members often have higher rates of serious health conditions," CMS explained. "These plans often rely heavily on risk adjustment payments versus premiums alone for their revenue."

The finalized notice also addressed agent and broker activity, federal and state user fee rates, denied quality health plan certificates and more. The final notice went into effect on January 15, 2025. CMS released the specifics regarding the final rules about a week after HHS revealed that the ACA marketplace had surpassed previous enrollment records.

Kelsey Waddill is a managing editor of Healthcare Payers and multimedia manager at Xtelligent Healthcare. She has covered health insurance news since 2019.