On June 3, 2026, plaintiffs City of Columbus et al. (including municipalities, local governments, and advocacy organizations) filed a complaint alleging that several policies in the HHS 2027 Notice of Benefit and Payment Parameters Final Rule (2027 Payment Notice Final Rule) are unlawful. The plaintiffs seek declaratory and injunctive relief in the U.S. District Court for the District of Maryland. See City of Columbus et al. v. Kennedy et al. (Columbus II), No. 26-cv-2215, ECF No. 1 (D. Md. June 3, 2026).

The 2027 Payment Notice Final Rule, published in the Federal Registrar on May 20, 2026, implements aspects of the Affordable Care Act ("ACA") for issuers offering qualified health plans ("QHPs") through Exchanges.  The 2027 Payment Notice Final Rule also includes updates to align regulations with changes made in the Working Families Tax Cut legislation. 

The plaintiffs allege that the 2027 Payment Notice Final Rule is contrary to the goals of the ACA, will cause millions of Americans to lose coverage on the ACA’s Exchanges and will increase premiums and out-of-pocket costs for the remaining enrollees, causing irreparable harm. The plaintiffs allege that many of the provisions of the 2027 Payment Notice Final Rule are in direct conflict with federal law and that HHS failed to adequately consider public comments or provide adequate reasoning for many final policies. Specifically, the plaintiffs allege a violation of the Administrative Procedure Act and are challenging the following provisions from the 2027 Payment Notice Final Rule: 

• Failure-to-Reconcile Penalty
• Mandatory Verification for Low-Income Enrollees
• Refusal to Accept Attestation from Applicants When Tax Data is Lacking
• Verification Requirements for Special Enrollment Periods
• Increased Out-of-Pocket Spending Burdens for Certain Enrollees (bronze plans with annual limitations on cost-sharing higher than the statutory limitation)
• Expansion of Eligibility for Less Comprehensive Forms of Coverage
• Multi-Year Catastrophic Plans
• Certification of Non-Network Plans as QHPs
• Reduced Standards for Network Adequacy
• Elimination of Standardized Plans and Non-Standardized Plan Limits
• Elimination of Premium Payment Threshold Options
• Changes to Cost-Sharing Reduction Policies

This same group of plaintiffs sued HHS on July 1, 2025, challenging the “Patient Protection and Affordable Care Act; Marketplace Integrity and Affordability” (Market Integrity Final Rule) in the U.S. District Court for the District of Maryland. On August 22, 2025, the court stayed several major components of the Market Integrity Final Rule on a nationwide basis. 

The plaintiff’s June 3, 2026, complaint argues that the 2027 Payment Notice Final Rule is a continuation of prior Trump Administration efforts to undermine the ACA which the District Court has previously and repeatedly vacated and remanded portions of the regulations as unlawful and arbitrary and capricious. 

For more information on the final rule, see our prior posts:

• The Friday Evening Surprise: CMS Releases the 2027 Payment Notice Final Rule, Michelle Koltov, Lisa Campbell