HAFA filing suit over ACA agent moratorium

Another health agent organization is taking legal action over a moratorium on new agents and brokers seeking to register to enroll consumers in coverage on the federally facilitated Affordable Care Act marketplace.

Health Agents for America announced Wednesday it is filing suit against the U.S. Department of Health and Human Services and the Centers for Medicare & Medicaid Services. HAFA is seeking a temporary restraining order in response to CMS’ recent announcement that it will impose a moratorium on new agents and brokers just weeks before the start of open enrollment season on Nov. 1.

“For years, HAFA has sounded the alarm about fraud in the ACA Marketplace,” HAFA president CEO Ronnell Nolan said in an announcement today. “We reported it, documented it, and met with CMS, Congress, state departments of insurance, and federal officials demanding stronger consumer protections.”

Nolan said HAFA “has always supported stopping fraud.

“But fighting fraud cannot come at the expense of innocent consumers, legitimate agents, due process or Americans' access to health insurance.”

CMS has imposed a moratorium preventing agents without an active 2026 exchange agreement from newly registering for Plan Year 2027. The agency has also intensified enforcement actions and canceled hundreds of thousands of Marketplace enrollments it identified as unauthorized.

“HAFA remains concerned about government data and verification practices that may put legitimate consumers at risk, particularly those with little or no recent medical utilization,” Nolan said.

“Having health insurance without visiting a doctor is not evidence of fraud. CMS has characterized its cancellations as unauthorized enrollments, not simply unused coverage. That distinction matters, but so does due process. Americans purchase health insurance for protection against the unexpected. No consumer should have to get sick to prove their coverage is legitimate. Likewise, agents who follow the rules deserve an opportunity to defend themselves before losing their livelihoods.”

A temporary restraining order seeks temporary relief while the court considers the legal issues; requesting one does not guarantee approval.

Nolan said HAFA’s legal effort is supported by field marketing organizations and industry leaders “who understand the consequences extend far beyond one agent, agency or organization.”

NABIP goes to federal court

HAFA’s announcement came on the same day that a hearing was held in U.S. District Court in the District of Maryland on a similar request for a temporary restraining order filed by the National Association of Benefits and Insurance Professionals. NABIP said the moratorium “threatens the livelihoods of thousands of legitimate, licensed professionals who have not been accused of fraud and limits consumers’ access to professional assistance as they navigate open enrollment.”

The court did not issue a final ruling on the request for the temporary restraining order. Judge Stephanie Gallagher asked HHS's attorney to tell the court by the close of business Thursday how long it would take the federal agency to develop and make available new agent and broker training. The next hearing will be held Nov. 5. NABIP will seek to demonstrate why CMS should be required to allow affected agents and brokers to complete the necessary training and registration as soon as possible during open enrollment.

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Susan Rupe is editor in chief, magazine, for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at susan.rupe@innfeedback.com.