Federal regulators’ efforts to block new marketers from selling health insurance exchange policies in 2027 have landed them in court.
Agent and broker trade group the National Association of Benefits and Insurance Professionals sued the Health and Human Services Department and the Centers for Medicare and Medicaid Services in the U.S. District Court for the District of Maryland on Thursday, alleging the agencies violated the Administrative Procedure Act of 1946 by failing to ask for public comments before banning new marketers from selling policies on HealthCare.gov for 2027. The lawsuit also alleges the agencies lack the statutory authority to implement the freeze.
The trade group seeks to vacate the interim rule and force CMS to make sales training available for new agents and brokers immediately. It also asks for any other relief the court deems just. HHS and CMS finalized the rule last month as part of their anti-fraud campaign.
Open enrollment runs from Nov. 1 to Jan. 15 in most states.
“Banning thousands of agents and brokers who have done nothing wrong — many of whom have long and distinguished records helping consumers — is not targeted fraud prevention. It is an overbroad response that harms legitimate professionals and the consumers they serve,” National Association of Benefits and Insurance Professionals President Mychal Walker said in a news release on Thursday. “CMS should be going after bad actors, not shutting out thousands of licensed agents and brokers because of a handful of bad agents and brokers.”
HHS and CMS did not immediately respond to interview requests.