You Down With NBPP? (Yeah You Know Me!) CMS releases final 2026 Notice of Benefit & Payment Parameters!

 

The Affordable Care Act includes a long list of codified instructions about what's required under the law. However, like any major piece of legislation, many of the specific details are left up to the agency responsible for implementing the law.

While the PPACA is itself a lengthy document, it would have to be several times longer yet in order to cover every conceivable detail involved in operating the ACA exchanges, Medicaid expansion and so forth. The major provisions of the ACA fall under the Department of Health & Human Services (HHS), and within that, the Centers for Medicare & Medicaid (CMS)

Every year, CMS issues a long, wonky document called the Notice of Benefit & Payment Parameters (NBPP) for the Affordable Care Act. This is basically a list of proposed tweaks to some of the specifics of how the ACA is actually implemented for the following year.

The 2026 NBPP was just released by the Centers for Medicare & Medicaid Services (CMS), and it takes on additional importance since the ACA, along with Medicare, Medicaid, and everything else under the provision of CMS is about to be administered by the incoming Trump 2.0 Administration.

I have no clue how many of the following policies will actually be implemented as is by Trump's HHS and/or CMS heads (likely to be antivaxxer nutcase RFK Jr. and snake oil salesman grifter Dr. Oz), but here's the main provisions set to go into effect in 2026 as of this writing:

The Affordable Care Act (ACA) is more popular than ever: A new report shows that nearly 50 million people – or one in seven Americans – have had ACA Marketplace coverage at some point. And so far, nearly 24 million people have selected plans during the 2025 Open Enrollment Period, which runs until January 15 on HealthCare.gov.

Side note: With Basic Health Plan (BHP) enrollees included in New York, Minnesota & Oregon, the official total is actually north of 25.3 million as of today.

Under President Biden and Vice President Harris, ACA coverage has become more affordable than ever: People with ACA Marketplace coverage save an average of $800 per year thanks to the Inflation Reduction Act of 2022 and benefit from additional outreach and assistance to get the coverage that best meets their needs. 

The Biden-Harris Administration is committed to ensuring Marketplace coverage remains accessible and affordable.

Today, the Department of Health and Human Services (HHS) Centers for Medicare & Medicaid Services (CMS) issued the final “HHS Notice of Benefit and Payment Parameters for 2026” (or the “final 2026 Payment Notice”) that sets standards for the Health Insurance Marketplaces, as well as for health insurance issuers, brokers, and agents who connect millions of consumers to ACA coverage. 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). 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.

The final rule also includes updates to the HHS-operated risk adjustment program (the permanent program that transfers funds from issuers of risk adjustment covered plans with lower-than-average risk to issuers of risk adjustment covered plans with higher-than-average risk); 2026 user fee rates for issuers; changes to calculations for the Basic Health Program (BHP); and annual public reporting of aggregated, summary-level information from the ACA Quality Improvement Strategy (QIS), a program that aims to incentivize improved health outcomes for plan enrollees. These and other policies in the final rule are designed to reduce administrative burdens, ensure accurate risk adjustment transfers, promote transparency, and enhance health equity in the Marketplace.

The final 2026 Payment Notice is effective January 15, 2025. 

Preventing Unauthorized Marketplace Activity Among Agents and Brokers

Strengthening Reviews and Enforcement Actions, When Needed

CMS is finalizing a policy that enables it to take enforcement actions against lead agents at insurance agencies to hold them responsible for violations of Marketplace standards when appropriate. This policy will enhance public trust in the Marketplace, increase accountability for agents, brokers, and web-brokers who assist consumers, and reduce the risk of fraud or misconduct that puts consumers’ health care coverage at risk.

Expanding Authority to Immediately Suspend Marketplace Agents and Brokers

Currently, if CMS determines that an agent or broker poses an unacceptable risk to Marketplace operations or Marketplace information technology systems, we will use our existing authority to immediately suspend that agent or broker’s ability to transact information with the Marketplace until the incident or breach is remedied or sufficiently mitigated to CMS’ satisfaction. In this rule, CMS is finalizing a policy to expand its authority to immediately suspend an agent or broker’s ability to transact information with the Marketplace if we discover circumstances that pose an unacceptable risk to the accuracy of Marketplace eligibility determinations, operations, applicants, or enrollees, or Marketplace information technology systems. This policy will improve the security and integrity of the Marketplace, resulting in fewer unauthorized changes to coverage and preventing further harm to consumers and compliant agents and brokers.​

Updating the Model Consent Form

CMS is finalizing updates to its model consent form, which was created to help agents, brokers, and web-brokers document consent from consumers to assist with their Marketplace enrollments and submission of Marketplace eligibility applications. The updated form will help document that a consumer or their authorized representative reviewed and confirmed the accuracy of their eligibility application information before their application was submitted to a Marketplace. The updated model consent form will also include scripts that agents, brokers, and web brokers can use to document compliance with requirements for consumer consent and consumer review and confirmation of the accuracy of their eligibility application information via an audio recording. These updates will increase transparency and accountability in the application and enrollment process, help ensure that Marketplace application information is accurate, and reduce the risk of financial errors, such as receiving an incorrect advance payment of the premium tax credit (APTC) amount that a consumer would need to repay during tax reconciliation, or enrollment in health care coverage without a consumer’s consent.

All three of these changes are in direct response to the ACA broker/agent fraud scandal which was first reported last spring by KFF reporter Julie Appleby. The short version is that some number of brokers/agents have been busted either enrolling people in ACA exchange policies without the enrollee knowing about it or switching existing enrollees to different policies without them being informed or giving their consent to do so.

CMS has been cracking down on this problem for months now, but it sounds like those measures are just stopgaps until they can make more significant procedural, legal and/or technical improvements to deal with the issue.

Addressing Allowable Cost-Sharing Reduction (CSR) Loading 

“CSR loading” refers to increasing premium rates to offset the cost of providing CSRs, which lower the amount consumers pay for deductibles, copayments, and coinsurance. CMS is finalizing language codifying that CSR loading practices are allowed when the adjustments are actuarially justified and follow state law, provided the issuer does not otherwise receive reimbursement for such amounts. Enrollees who receive premium tax credits (PTCs) to cover all or part of their premium costs get more support through PTCs to generally cover higher premiums caused by CSR loading.

Hallelujah! At long last! Until now, "Silver Loading" (This NBPP is the first time I've ever heard it called "CSR loading") has been a widely-used pricing practice in many states for years now, ever since the first Trump Administration pulled the plug on CSR insurance carrier reimbursement payments back in October 2017. I've written about Silver Loading countless times since then, but until now it's never been formally codified as an official practice by CMS, though many states have done so.

The caveat is also important: "...provided the issuer does not otherwise receive reimbursement for such amounts." In other words, if Congress ever does formally appropriate CSR reimbursement payings in a future update to the ACA's legislative text (the lack of such language is what allowed Trump to cut off these payments in the first place), insurance carriers would not be allowed to "double dip" by receiving both CSR reimbursements and Silver Loading premium hikes.

Advancing Health Equity and Mitigating Health Disparities

Updating Premium Payment Thresholds to Permit Fixed and/or Premium-Percent Thresholds

CMS is finalizing allowing issuers to implement a fixed-dollar premium payment threshold and/or one of two percentage-based premium payment thresholds, which will be used to enable consumers to maintain their coverage even if they have not paid the full amount owed, as long as the amount paid does not exceed the premium payment threshold set by the issuer. This will help avoid triggering a “grace period,” which typically begins when a consumer first fails to pay their monthly premium, and by the end of which, the consumer needs to pay the full amount of their premium due to avoid losing coverage. For the fixed-dollar threshold, CMS is finalizing a cap of $10 or less (adjusted for inflation), which means that if an issuer adopts a $10 fixed-dollar threshold, a consumer who has paid their first premium and then subsequently owes $10 or less after the application of their APTC will not be put into a grace period as long as they owe $10 or less in premiums. 

CMS is also finalizing allowing issuers to choose between one of two percentage-based thresholds:

Net premium threshold: Currently, issuers have the option to adopt a net percentage-based premium payment threshold, which allows consumers to maintain their coverage even if they have paid the enrollee-responsible portion of the premium that is less than 100%, as long it is within the reasonable threshold set by the issuer. CMS is finalizing modifications to this requirement so that the existing net premium percentage threshold must be 95% or higher. This means that if a consumer has paid at least 95% of their premium due (depending on the threshold the issuer sets) after the application of the monthly tax credit, the issuer will not be required to trigger a grace period.

Gross premium threshold: CMS is finalizing a gross percentage-based premium payment threshold that will allow consumers who have paid their first premium to maintain their coverage even if they have paid a portion of the total premium that is less than 98% or more, as set by the issuer. This means that if a consumer has paid at least 98% of their total premium amount due (depending on the threshold the issuer sets), they will not trigger a grace period.

These policies allow issuers to choose a method that works best for them and their consumers. Thresholds generally help to reduce terminations of coverage for enrollees– particularly people with low and modest incomes – who risk losing coverage when they fail to pay a small amount they might owe for their premium. 

This is the first I've heard of the "payment threshold" thing but it seems reasonable to me to avoid someone being kicked off their plan for owing a nominal amount of money (presumably they'd be kicked over the threshold when the following month's premium is due anyway, so sooner or later they'd still have to pay what they owe).

Changes to the Medical Loss Ratio (MLR) Reporting and Rebate Calculations for Certain Plans that Enroll Underserved Consumers with High Health Needs

CMS is finalizing a policy that would amend the MLR regulations to provide qualifying issuers with the option to modify the treatment of net risk adjustment receipts for purposes of the MLR and rebate calculations, such that these net receipts impact the MLR denominator rather than the MLR numerator. This policy supports plans with unique business models that focus on underserved communities whose members often have higher rates of serious health conditions. These plans often rely heavily on risk adjustment payments versus premiums alone for their revenue.

This gets pretty wonky, but basically it's about tweaking the ACA's rule requiring insurance carriers to send rebate checks back to policyholders if they spend less than 80% premium payments on actual healthcare/medical claims.

Essential Community Provider (ECP) Certification Reviews in States Performing Plan Management

ECPs typically serve people with low-income or traditionally unmet medical needs. Beginning in plan year 2026, CMS is finalizing conducting ECP certification reviews of Qualified Health Plans (QHPs) in FFMs in states performing plan management functions to ensure issuers include in their provider networks a sufficient number and geographic distribution of ECPs. This policy will add more consistency to how the Federal government oversees ECP data across all FFMs.

Making It Easier to Enroll in and Maintain Health Care Coverage

Extending Consumer Notification Requirements to Two Consecutive Tax Years for Failure to File and Reconcile 

As part of receiving APTC, which helps make health care coverage more affordable, eligible consumers must file their federal income taxes and reconcile their APTC as part of their annual income tax filings. Failing to do so (often called Failure to File and Reconcile or “FTR”) means a consumer will no longer be eligible for APTC. To make these requirements clearer, CMS is finalizing the requirement that Marketplaces notify enrollees or their tax filers who have failed to file their federal income taxes and reconcile their APTC for two consecutive tax years that they are at risk of losing APTC. These notices will help educate consumers about the need to file and reconcile to keep coverage affordable. 

BHP Updates 

CMS is finalizing an update to the payment methodology to recalculate the premium adjustment factor (PAF) in certain situations. Specifically, CMS will recalculate the PAF if a state is using the premiums from a year in which BHP was only partially implemented as the basis for their federal BHP payments. This policy will result in more accurate federal BHP payments to states newly implementing a BHP. 

The Basic Health Plan (BHP) Programs in New York and Minnesota have been operating for years now, but Oregon just launched their version last July. I'm guessing that this change was required due to Oregon launching their BHP program mid-year, which apparently caused some pricing/funding hiccups.

CMS is also finalizing a clarification of how the agency calculates BHP payment rates when there are multiple “second-lowest-cost silver plan premiums” in a county. Under CMS’ policy, if there is more than one-second lowest-cost silver plan in a county, a state’s BHP payment will be based on the premiums of the relevant plan in the largest portion of the county, as measured by the county’s total population.

Huh. I guess legally speaking you can't base something on "the 2nd lowest cost plan" if there's more than one plan priced exactly the same.

Simplifying Plan Choice and Improving Plan Selection 

Updating Standardized Plan Options and Non-Standardized Plan Option Limits

“Standardized plan options” are QHPs that include standardized cost sharing and pre-deductible coverage for a key set of benefits. Issuers on the Marketplaces that use the Federal platform are required to offer these plans at every product network type, at every metal level, and throughout every service area where they offer non-standardized plan options. CMS is finalizing updates to standardized plan options for plan year 2026 to ensure these plans continue to have actuarial values (AVs) aligned with the plans’ metal levels and to maintain continuity in plan designs. CMS is also finalizing the requirement that issuers offering multiple standardized plan options within the same product network type, metal level, and service area meaningfully differentiate these plans from one another to reduce the risk of duplicative offerings. This will help consumers better understand the benefits, networks, and drug coverage included when making plan selections and comparisons.

CMS is also finalizing amendments to the regulation to clarify the flexibility that issuers have to vary whether they include coverage for adult dental, pediatric dental, and adult vision benefits within their non-standardized plan options. These amendments clarify how non-standardized plan options may vary benefit coverage within the plan limit and will align the regulation text with the flexibility that issuers have been operationally permitted since these requirements were introduced in the 2024 Payment Notice. These complementary policies will continue to reduce the risk of plan choice overload and facilitate a more meaningful evaluation of available plan choices for consumers on the Marketplaces, while simultaneously ensuring that consumers continue to have access to plans with a sufficient variety of design features. This includes plans offered under the non-standardized plan option limit exceptions process that facilitate the treatment of chronic and high-cost conditions, which could play an important role in combatting health disparities and advancing health equity.

(sigh) I still wish they would follow California & Massachusetts' leads by requiring that every plan offered on the exchange be standardized (allowing "non-standard" plans kind of defeats the entire point), but they're inching towards that I guess...though again, this will likely be cannonballed by Trump's CMS Admin anyway.

Increase Transparency

Improve Public Reporting on Marketplaces

CMS is finalizing increasing transparency and promoting program improvements by publicly releasing State Marketplace operations data including spending on outreach and additional Open Enrollment customer service metrics, such as for call centers and websites. This will help enhance public understanding of and confidence in Marketplace operations, ensure transparent compliance activities, and improve Marketplace efficiency and accountability. We also clarify in the final rule that we will not publicly release the State Marketplaces’ annual State-based Marketplace Annual Reporting Tools (SMARTS), which we proposed to do in the proposed rule.

I don't really post a whole lot about ACA marketplace budgets or spending, and almost never write about call center/etc. metrics, but more tranparancy is still generally a good thing. I just wish every ACA exchange (federal or state-based) was required to post the same type of enrollment data that they do during Open Enrollment year round (monthly) as well...a few SBMs already do, but most don't.

Quality Improvement Strategy (QIS) Information Sharing

CMS is finalizing that it will share aggregated, summary-level QIS information publicly on an annual basis starting January 1, 2026 (with data submitted during the 2025 QHP Application Period). The goal of information sharing aligns with other Marketplace Quality Initiatives (MQI) as well as agency efforts to drive innovation and advance quality improvement across the Marketplace. Information sharing will increase public transparency and accountability for QHP issuers and encourage best practices for improving health care coverage quality.

Further Refining the HHS-operated Risk Adjustment Program

Recalibrating the 2026 Benefit Year HHS Risk Adjustment Models

To continue to keep the risk adjustment models up to date while promoting model stability, CMS is finalizing the recalibration of the HHS risk adjustment models for the 2026 benefit year using 2020, 2021, and 2022 benefit years’ enrollee-level EDGE data. Additionally, CMS is finalizing that it will begin phasing out the market pricing adjustment to the plan liability associated with Hepatitis C drugs starting with the 2026 benefit year such that the costs associated with these drugs will be modeled more consistently with other specialty drugs. Lastly, CMS is finalizing the addition of human immunodeficiency virus (HIV)pre-exposure prophylaxis (PrEP) drugs into the 2026 benefit year HHS risk adjustment models as a new, separate factor in the adult and child models. This addition will help address potentially high costs associated with PrEP, thereby reducing issuer incentives to restrict coverage and access to care. Generic drugs will be excluded from the definition of PrEP in both the adult and child risk adjustment models. 

Updates to HHS Risk Adjustment Data Validation (HHS-RADV) Policies 

As part of HHS-RADV, issuers offering risk adjustment covered plans must have initial and second validation audits performed on a sample of risk adjustment data selected by CMS. To improve the precision of HHS-RADV results, which are used to adjust risk scores and risk adjustment state transfers, CMS is finalizing changes to the initial and second validation audit policies. 

For the initial validation audit (IVA) sampling, CMS is finalizing 1) excluding enrollees without Hierarchical Condition Categories (HCCs), which includes adult enrollees with only Prescription Drug Categories (RXCs), from the IVA sample, 2) removing the Finite Population Correction (FPC), which is currently used to determine modified IVA sample sizes for smaller issuers, and 3) replacing the source of the Neyman allocation data usedto determine the IVA sample stratum allocation with the three most recent consecutive years of HHS-RADV data. 

For the second validation audit (SVA), CMS is finalizing modifying the SVA pairwise means test to use a bootstrapped 90%confidence interval to test for statistically significant differences between IVA and SVA results and increasing the initial SVA subsample size from 12 to 24 enrollees. 

These policies will improve the precision of these audits and issuers’ HHS-RADV results.

Making Improvements to HHS-RADV’s Actionable Discrepancy and Appeal Threshold

CMS provides an opportunity for issuers of risk adjustment-covered plans to submit an appeal to contest HHS-RADV SVA results (if applicable) or error rate findings if the amount in dispute meets the materiality threshold for filing. In this rule, CMS is finalizing a second materiality threshold for rerunning HHS-RADV results in response to a successful appeal. Under this new threshold, HHS will only take action to rerun HHS-RADV results if the financial impact on the filing issuer’s HHS-RADV adjustment is greater than or equal to $10,000. This will promote the stability of HHS-RADV and reduce administrative costs for issuers and the Federal government. 

As I always note every year, the ACA's Risk Adjustment program is very wonky and well outside of my wheelhouse, so I don't have a lot to say about it. I assume the above changes are for the better but can't really comment on them one way or the other.

Strengthening the Marketplace’s Impact on Consumers

2026 FFM/SBM-FP User Fee Rates 

The Marketplaces rely on user fees to remain financially viable and sustainably meet necessary obligations. For the 2026 benefit year, CMS is finalizing an FFM user fee rate of 2.5% of monthly premiums, and a State-based Marketplace on the Federal platform (SBM-FP) user fee rate to 2.0% of monthly premiums. Additionally, since enrollment projections are a key component to the calculation of user fee rates, CMS also considered the availability of enhanced PTC subsidies provided by the American Rescue Plan Act of 2021, which were extended by the Inflation Reduction Act of 2022. These subsidies have increased Marketplace enrollment by millions of new consumers and are set to expire at the end of 2025. As such, CMS is also finalizing an alternative set of user fee rates, where, if enhanced PTC subsidies are extended through the 2026 benefit year by July 31, 2025, the FFM user fee rate would be 2.2% of monthly premiums, and the SBM-FP user fee rate would be 1.8%of total monthly premiums. These lower user fee rates account for projected higher consumer enrollment in the Marketplaces due to the continued availability of enhanced PTC subsidies.

The current fees for the 31 states hosted via HealthCare.Gov are already 2.2% and 1.8% respectively. One ancillary downside of the ARPA/IRA subsidies likely expiring at the end of 2025 would be that the inevitable drop in enrollment would also mean less premium revenue, which in turn would mean less user fee revenue to properly operate & market HealthCare.Gov...thus leading to them bumping those user fees back up again.

HC.gov user fees remained constant through 2020, when they were reduced from 3.5% & 3.0% to 3.0% & 2.5% respectively to 3.0% & 2.5%. This is the first time that HC.gov user fees have been scheduled to increase (though CMS does hold out hope for the IRA subsidies being extended after all).

Continuing to Support Risk Adjustment

CMS, on behalf of HHS, will be responsible for operating risk adjustment in every state and the District of Columbia for the 2026 benefit year. A risk adjustment user fee is collected to cover a wide range of activities that support risk adjustment program activities. For the 2026 benefit year, CMS is finalizing a risk adjustment user fee of $0.20 per member per month. This is higher than the 2025 benefit year user fee to account for updated enrollment estimates in the individual and small group markets if enhanced PTC subsidies expire as currently enacted. 

Again, if the IRA subsidies expire, that means enrollment will drop, so CMS will be bumping up these fees accordingly.

Connecting Actuarial Value Calculation to Levels of Coverage

CMS maintains an Actuarial Value (AV) Calculator to calculate an issuer’s level of coverage for a given cost-sharing plan design. CMS is finalizing revisions to its methodology for updating the AV Calculator so the agency will only publish a single, final version of the AV Calculator each plan year. Doing so will reduce administrative burden while still ensuring the accuracy of the AV Calculator.

Clarifying the Timeliness Standard for State Marketplaces to Review and Resolve Enrollment Data Inaccuracies

Accurate and efficient resolutions of issuers’ enrollment data inaccuracies benefit consumers by ensuring accurate and timely payment of APTC and remains key to connecting consumers with affordable health care coverage. CMS is finalizing codifying guidance for State Marketplaces to review and resolve data inaccuracies and send them to HHS within 60-calendar days after receipt of a complete inaccuracy submission from a State Marketplace issuer. 

Reconsidering Denied QHP Certifications

Certifying issuers of QHPs is critical to ensuring consumers can benefit from high-quality, affordable, person-centered health care coverage. Beginning in 2026, CMS is finalizing a clarification that a Marketplace may deny certification to any plan that does not meet applicable criteria. Additionally, CMS is finalizing refining the FFM standards for requests for reconsideration of a certification denial. These policies will require issuers to submit a written request for reconsideration, providing clear and convincing evidence that HHS’ determination that the plan did not meet the general certification criteria was in error.