Program integrity has become an urgent, administration-wide healthcare priority, placing the Affordable Care Act (ACA) Marketplace under heightened scrutiny. On September 22, 2026, the Centers for Medicare & Medicaid Services (CMS) announced Federal Marketplace anti-fraud actions with immediate operational and financial implications for insurers.
This week, actuaries from Wakely Consulting Group, an HMA company, examine how Marketplace disenrollment actions could affect health insurers in 2026 and beyond across enrollment, morbidity, risk adjustment, financial reporting, operations, distribution strategy, and future pricing.
CMS Marketplace Anti-Fraud Actions and Unauthorized Enrollment Cancellations
CMS’s three-part program integrity strategy focuses on preventing fraudulent and improper enrollments, removing confirmed unauthorized enrollments, and enforcing Marketplace requirements for agents and brokers. The agency also established a Federal Marketplace anti-fraud coordination group comprising leaders from CMS and the US Department of Health and Human Services (HHS) to direct these efforts.
CMS reported canceling approximately 315,000 enrollments covering more than 760,000 individuals after determining that the coverage was unauthorized. The agency expects approximately $2.2 billion in advance payments of the premium tax credit (APTC) to be returned and will continue working with insurers to identify additional cases, prevent improper subsidy payments, and recoup prior payments.
This action follows a June 2026 report from the HHS Office of the Assistant Secretary for Planning and Evaluation, which identified approximately 1 million highly suspicious agent- and broker-assisted HealthCare.gov enrollments involving applications without a Social Security number and members paying no premium.
Although the absence of a Social Security number does not independently establish fraud, the September announcement sends a strong signal about CMS’s willingness to cancel enrollments confirmed as unauthorized.
Financial and Operational Implications for ACA Marketplace Insurers
Enrollment Losses and Morbidity Risk for ACA Marketplace Plans
In their August 2026 white paper, Implications for Potential Marketplace Unauthorized Enrollment Actions, actuaries from Wakely noted that while the overall enrollment reduction is known, its distribution across issuers and markets is not publicly available. If canceled members are disproportionately healthy or had limited healthcare utilization, their removal could increase average claims among the remaining population. For example, if non-utilizers represented 10 percent of an issuer’s enrollment, removing them would increase average claims per member per month by approximately 10 percent, assuming no other changes.
ACA Risk Adjustment Implications of Marketplace Disenrollments
Changes in enrollment and morbidity could materially affect ACA risk adjustment transfers, but the results will vary according to each issuer’s concentration of confirmed or potentially unauthorized enrollment. Issuers with greater exposure to canceled enrollment could see more favorable risk adjustment results even as average claim costs increase. Those transfers may not fully offset deterioration in the remaining risk pool, which underscores the need for plan- and state-specific analysis.
APTC Recoupment and Financial Reporting Considerations for Insurers
The timing and process to recoup approximately $2.2 billion in APTCs has near-term financial reporting considerations. Issuers should evaluate potential effects on:
- Premium and APTC accruals
- Risk adjustment transfer accruals
- Per member claims cost estimates
- Premium deficiency reserve considerations
According to CMS, the cancellations announced in September 2026 will be applied retroactively to original effective dates. The full effect of this heightened scrutiny, however, will depend on how CMS approaches recoupment and how quickly issuers process enrollment and financial adjustments.
Issuers may also incur near-term costs associated with identifying and investigating suspicious enrollments, reconciling records with CMS, processing cancellations, adjusting revenue accruals, supporting affected consumers, and updating broker oversight. Lower enrollment also leaves fewer premium dollars available to cover fixed administrative expenses.
How CMS Disenrollments Could Affect Future Marketplace Premiums
As 2027 premiums are finalized, issuers will need to consider enrollment and morbidity shifts for 2028 prices. Insurers with established monitoring and projection processes will be better positioned to assess new CMS information and adjust forecasts as policy and enforcement evolve for 2026 and 2027.
CMS Broker Enforcement and Marketplace Distribution Risks
In addition to strengthening oversight of enrollment data, CMS has intensified enforcement of agent and broker requirements. Since January 2026, the agency has sent termination notices to more than 200 noncompliant agents and brokers and issued 569 notices of intent to terminate Exchange Agreements associated with 2026 applications that lacked identifying applicant information. Issuers should assess concentration by broker, monitor enrollment quality, and consider how enforcement may affect acquisition channels, member mix, and future growth.
Market-Level Variation in Marketplace Disenrollment Risk
The effects of CMS’s actions are limited to Federally Facilitated Marketplace (FFM) states and state-based Marketplaces using the federal platform (SBE-FM) and do not extend to state-based Marketplaces operating their own eligibility and enrollment systems. Individual issuer effects could vary materially based on several factors, including state, county, issuer, product, broker channel, and member premium contribution.
Some issuers will be more exposed than others, particularly those with more enrollees paying low or $0 net premiums, greater broker reliance, substantial automatic reenrollment, or a strong presence among lower-cost plans. Understanding the financial impact will require analysis at the plan and market levels.
Key Actions for Health Insurers Following CMS Marketplace Disenrollments
Health insurers should assess a range of outcomes at the plan and state levels. This analysis should show how the concentration and health profile of canceled enrollment could affect claims, APTCs, risk adjustment, financial accruals, administrative expenses, distribution, and future rates.
The timing of CMS’s actions will shape those outcomes. Because the announced cancellations apply retroactively to original effective dates, insurers will need to account for APTC recoupment and related enrollment and financial adjustments. The ultimate impact will depend on the data CMS provides, the scope of additional reviews, processing timelines, and any appeals or corrections. Issuers should revisit their forecasts as these details emerge and federal actions continue ahead of the 2027 plan year.
Assessing Marketplace Disenrollment Risk: How HMA and Wakely Can Help
Health Management Associates (HMA) and Wakely Consulting Group combine policy, market, actuarial, and financial expertise to help health plans and state regulators assess the effects of Marketplace program-integrity actions. For insurers, our teams can develop plan-by-plan and state-by-state projections of enrollment, morbidity, claims, APTCs, risk adjustment, and premiums; test prospective and retrospective cancellation scenarios; and translate the findings into pricing, forecasting, distribution, and market strategy decisions.
State insurance regulators in affected FFM and SBE-FP states will need a market analysis of how the cancellations are distributed across issuers and whether changes in enrollment and morbidity could affect rates, risk adjustment, capital, or continued plan participation. Regulators should also evaluate whether approved 2027 rates and financial assumptions remain supportable and monitor solvency and consumer access as insurers adjust to this and CMS’s broader program integrity actions. HMA and Wakely can support this work through state-specific market assessments, issuer-level stress testing, rate and risk-pool analysis, and scenario projections that help regulators identify emerging concerns and act before they threaten market stability.