Federal health officials announced on September 22, 2025, that the Centers for Medicare and Medicaid Services (CMS) canceled 315,000 Affordable Care Act (ACA) marketplace policies covering 760,000 enrollees due to unverified eligibility. The action, led by the White House Task Force to Eliminate Fraud, follows a review of enrollment records to confirm legal residency, income thresholds, and other program requirements.
CMS Administrator Dr. Mehmet Oz stated that approximately 35% of current enrollees had never used ACA benefits, such as prescriptions or doctor visits. The enforcement effort also involves verifying the legal status of 419,000 additional enrollees to ensure compliance with U.S. residency and income eligibility rules. Officials estimate the cancellations will save $2.2 billion in taxpayer-funded subsidies over the next year.
The cancellations are part of a broader initiative to address what the administration describes as ‘rampant fraud’ and improper enrollments in the ACA marketplace. The task force, led by Vice President JD Vance, has accused prior administrations of failing to implement adequate verification systems, alleging that brokers were financially incentivized to enroll individuals without proper documentation.
Policy Changes and Broker Restrictions
In addition to the cancellations, federal officials terminated the access of hundreds of insurance brokers and agents to the ACA marketplace exchanges. The decision was based on concerns that these brokers submitted statistically implausible rates of applications lacking required identifiers, such as Social Security numbers. Since January 2025, 569 notices of intent to terminate exchange agreements have been issued, with a six-month moratorium on new broker registrations imposed. The pause will remain in effect until February 1, 2027.
Health Secretary Robert F. Kennedy Jr. described the cancellations as part of an effort to address ‘unauthorized enrollment, unauthorized plan switching, and other fraudulent activity’ involving a subset of agents and brokers. The rule change also pauses the registration of any agents not currently affiliated with federally facilitated exchanges, aiming to prevent misuse of private health information and reduce unauthorized access.
Background and Context
The ACA marketplace, established in 2010, provides federally subsidized private health insurance to individuals and families with incomes up to 400% of the federal poverty level. For 2026 enrollment, this threshold is set at $62,600 for an individual or $128,600 for a family of four. Enrollment in the marketplace surged from 10 million pre-pandemic to over 24 million during the COVID-19 era, driven in part by expanded eligibility windows and temporary premium subsidies that allowed some enrollees to gain coverage without premium payments.
Officials attribute the growth in improper enrollments to lax enforcement and verification processes, which permitted brokers to enroll individuals without income verification or required documentation. The Trump administration has framed the cancellations as a necessary correction to a system it argues was exploited for financial gain.
Political and Policy Reactions
Vice President JD Vance criticized the Biden administration during a press briefing, stating that the previous system ‘rewarded brokers for enrolling fake people’ into a program meant to ensure healthcare access. Dr. Mehmet Oz echoed these concerns, emphasizing that the lack of verification undermined the financial sustainability of the ACA by including enrollees who never utilized the program.
The administration’s actions have drawn both support and criticism. Supporters argue that the cancellations and broker restrictions are essential to protect taxpayer funds and ensure program integrity. Critics, however, contend that the enforcement may disproportionately impact low-income individuals and families who rely on ACA subsidies for coverage, particularly in states that expanded Medicaid eligibility under the ACA.
The CMS has not provided a breakdown of how many of the canceled policies involved individuals who were ineligible versus those who may have been improperly enrolled due to administrative errors. The agency has stated that additional reviews are ongoing to assess the full scope of the issue.