On September 29, Senate Republicans successfully blocked a Democrats-led CRA (Congressional Review Act) effort to stop a Centers for Medicare and Medicaid Services (CMS) rule on standardized health plans in the individual health insurance market.
The CMS rule (CMS-9883-F, RIN 0938-AV62) was finalized on May 20 and then corrected on July 21. It repeals an Affordable Care Act (ACA) marketplace rule that would have required insurers to offer standardized health plans in the individual market. It would also remove limits on the number of non-standardized plan options. In addition, the rule expands the potential for short-term limited duration (STLD) health insurance by allowing insurers to offer catastrophic health plans with multiple-year terms of up to 10 years, higher cost-sharing limits for ACA bronze plans, and non-network options to be certified as ACA marketplace plans.
CMS Administrator Dr. Mehmet Oz said “This rule strengthens eligibility checks, cracks down on abuse, and gives insurers more flexibility to offer affordable, consumer-focused coverage options.” However, Democrats say the rule allows an insurance marketplace that results in higher costs for worse coverage.
CMS estimated its rule would reduce enrollment in ACA plans in 2027 by up to two million.
The rule is the subject of two lawsuits, both of which are ongoing. One was brought by a coalition of states and the other by a coalition of municipalities and organizations representing doctors and small businesses. Last July, the US District Court for the District of Maryland imposed a stay on some parts of the rule, including the elimination of standardized plans, expanded eligibility for catastrophic coverage, and expanded maximum out-of-pocket limits for ACA bronze plans.
Prospects: The unsuccessful effort by Senate Democrats to block the CMS rule means the new rule will stand. But expect Democrats, if they succeed in winning control of the House and/or Senate, to try to roll back this rule, especially the piece involving STLD health insurance.
NAIFA Staff Contacts: Mike Hedge – Senior Director – Government Relations, at mhedge@naifa.org; or Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org