What’s Changing – and What Hasn’t Changed – on the ACA Marketplace? Part 1: H.R. 1

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What's Changing - and What Hasn't Changed - on the ACA Marketplace? Part 1: H.R. 1

Hill to the Heartland: Federal Health Policy Briefing

This three-part blog series summarizes the changes affecting eligibility for marketplace enrollment and advance premium tax credits, as well as selected other changes relevant to the health insurance marketplace, and provides an update on their current status.

• Part 1 focuses on the statutory changes affecting the marketplace in H.R. 1.
• Part2 focuses on the status of the 2025 Marketplace Integrity and Affordability Final Rule.
• Part 3 focuses on the status of the Notice of Benefit and Payment Parameters for 2027; Basic Health Program Final Rule, issued in 2026.

When referring to types of marketplaces in the final rules, KHI uses the term "marketplace" or "exchange" as they are used in the provisions of the Affordable Care Act and by the Centers for Medicare & Medicaid Services, U.S. Department of Health and Human Services.

Hill to the Heartland: Federal Health Policy Briefing is a product series providing regular updates on federal health policy discussions. Sign up here to receive these summaries and more, and also follow KHI on Facebook, X, LinkedIn and Instagram.

H.R. 1 and Other Recent Changes to Marketplace Coverage

In the past two years, Congress has passed legislation and the Centers for Medicare & Medicaid Services, Department of Health and Human Services (CMS/HHS) has finalized two major regulatory rules that make significant changes to enrollment in individual health insurance coverage and eligibility for advance premium tax credits (APTC) available through HealthCare.gov, the Affordable Care Act (ACA) federally facilitated marketplace (also known as the exchange) used by consumers in 28 states, including Kansas.

H.R. 1, also known as the One Big Beautiful Bill Act, was signed by President Donald J. Trump on July 4, 2025. CMS/HHS issued the Marketplace Integrity and Affordability Final Rule on June 20, 2025, and the Notice of Benefit and Payment Parameters for 2027; Basic Health Program Final Rule on May 15, 2026. The legislation and two final rules made numerous changes affecting who is eligible to enroll in marketplace coverage and receive financial assistance, in the form of APTC, to help pay monthly health insurance premiums, along with many other changes related to the marketplace.

While many of the provisions in H.R. 1 have already been implemented, several of the changes in the 2025 Marketplace Integrity and Affordability Final Rule and the Notice of Benefit and Payment Parameters for 2027 have been vacated (invalidated) or stayed (put on hold) nationwide by a federal district court in Maryland in response to two lawsuits filed in July 2025 and June 2026 by a group of cities and organizations representing health care professionals and small businesses. In these lawsuits, the plaintiffs alleged that the new rules limited enrollment opportunities, raised consumer health care costs, imposed new administrative burdens under the ACA, created barriers to coverage and allowed less comprehensive coverage.

This blog examines H.R. 1 and highlights key changes brought about by the law.

H.R. 1: A Section-by-Section Look at Key Changes

Section 71301 - Elimination of Marketplace Premium Tax Credit (PTC) Eligibility for Certain Lawfully Present Immigrants, Effective Jan. 1, 2027

Beginning in 2027, APTC and cost-sharing reduction (CSR) subsidies will no longer be available to all lawfully present non-citizens other than:

• Lawful permanent residents (known as green card holders)
• Certain Cuban and Haitian migrants
• Individuals from the Marshall Islands, the Federated States of Micronesia and the Republic of Palau, who live and work in the U.S. under the Compact of Free Association (COFA)

Lawfully present individuals who have previously been eligible for APTC and CSR subsidies but will lose eligibility in 2027 include refugees, those who have been approved for asylum, valid visa holders and people with temporary protected status.

Section 71302 - Elimination of Marketplace Premium Tax Credit Eligibility for Certain Lawfully Present Immigrants Ineligible for Medicaid, Effective Jan. 1, 2026

Beginning this year, lawfully present immigrants, including lawful permanent residents, with household incomes below 100 percent of the federal poverty level (FPL) and ineligible for Medicaid (based on their immigration status), are no longer eligible for APTC.

Section 71303 - Elimination of Provisional Eligibility, Elimination of Marketplace Auto Re-Enrollment, and Ineligibility When Failing to File and Reconcile Prior Year APTC Tax Forms, Effective Jan. 1, 2028

This section of the law will make several changes to the marketplace enrollment process. Beginning in 2028, consumers must actively verify at the time they apply for coverage their:

• Household income and family size
• Immigration status
• Health coverage status or eligibility for other coverage
• Place of residence
• Any other information required by the U.S. Department of the Treasury

Under the new law, this information must be verified by the marketplace using the information provided by the consumer before they can enroll in coverage and become eligible for APTC. Currently, the marketplace offers provisional coverage and APTC to new applicants based on the marketplace's real-time determination of an applicant's income and other information using federal and state databases. If additional information is required to confirm eligibility, the marketplace may extend provisional eligibility for up to 90 days to allow the applicant to provide the information requested. The new law ends this provisional eligibility practice in 2028 but provides for one exception to this process to allow the marketplace to provide provisional eligibility for applicants enrolling through a special enrollment period due to a change in family size, such as a birth or adoption.

For plan year 2028, the new law will also prohibit individuals from being automatically re-enrolled in the same plan (or a similar plan) they were enrolled in for the previous plan year. Individuals will be required to return to their marketplace account and actively update and verify their eligibility information before the end of the open enrollment period and will be ineligible for APTC if they fail to do so.

This section also requires all marketplaces to deny APTC to individuals who fail to file their required tax returns and reconcile the APTC received for the prior year. Under previous rules, enrollees who failed to file and reconcile their APTC had up to two years to submit the required forms. Under the new law, that period has been shortened to one year.

Section 71304 - Elimination of Certain Marketplace Special Enrollment Periods, Effective Jan. 1, 2026

For 2026, H.R. 1 prohibits individuals from receiving APTC and CSR subsidies if they enroll in a health plan during a special enrollment period (SEP) based solely on the relationship between the individual's household income and the federal poverty level (FPL). Individuals in this group will still be eligible to enroll in marketplace coverage during the regular open enrollment period and receive APTC and CSR subsidies if they otherwise qualify or if they qualify for a SEP based on loss of coverage, marriage, childbirth or other qualifying event.

Section 71305 - Removal of Limitations on Repayment of Premium Tax Credits, Effective Jan. 1, 2026

For the 2026 tax year, the new law removed the cap on the amount that consumers must repay if the APTC they receive is more than they should have received based on their actual income. For 2025, repayment was capped at $375 for single filers with household incomes below 200 percent FPL and increased up to $1,625 for single filers with household incomes below 400 percent FPL. The new law allows the full amount of any excess payment, regardless of household income, to be recaptured.

H.R. 1: Projected Impact on the Uninsured

On Aug. 25, 2025, the Congressional Budget Office (CBO) estimated that the provisions in H.R. 1 applicable to marketplaces will increase the number of people without health insurance by 2.1 million in 2034.

Note: Because H.R. 1 did not include an extension of the enhanced premium tax credits provided by the American Rescue Plan of 2021 and further extended through 2025 by the Inflation Reduction Act of 2022, the enhanced premium tax credits ended on Dec. 31, 2025.

Stay tuned for further updates on policy shifts that may affect health programs and services in Kansas. For related work on how federal policies could impact Kansans, please check out Hill to the Heartland.