The National Association of Benefits and Insurance Professionals is suing the Trump administration over its moratorium on new brokers entering the Affordable Care Act marketplaces.
The organization, the leading trade group for insurance brokers and agents, said the Centers for Medicare and Medicaid Services' moratorium impacts close to 19,000 brokers and agents who will be barred from registering ahead of open enrollment.
CMS unveiled the moratorium in late September as part of its ongoing push to root out fraud, waste and abuse. In addition, the agency said it would terminate more than 200 agents and brokers that failed to comply with marketplace standards.
The agency said new brokers and agents were disproportionately responsible for submitting inappropriate enrollments and engaging in behaviors at high risk for fraud.
In an announcement (PDF), NABIP says that it supports the broader effort to combat fraud, but that CMS' 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 organization argues in the lawsuit that the rule instituting the moratorium violates both the Administrative Procedure Act and the Affordable Care Act. The regulation is unlawful as it is "arbitrary, capricious, and unsupported by sufficient evidence," NABIP said.
The 19,000 agents who would be barred from participating under the rule are part of a critical network of professionals who help consumers find coverage that meets their needs, the organization said.
NABIP President Mychal Walker said that CMS should look elsewhere in its fraud efforts.
"The existence of fraud is not in dispute. NABIP has raised these concerns with CMS repeatedly and has offered concrete solutions to address them," Walker said in the announcement. "What is in dispute is whether the appropriate response is to exclude thousands of legitimate agents based solely on whether they registered last year, without any individualized evidence about them."
"There is a better approach: target fraud where it occurs, strengthen the system’s security and hold bad actors accountable while preserving consumers’ access to trusted professionals," Walker continued.
CMS has taken steps to crack down on brokers as the agency views improper ACA enrollments as a key target in its fight against fraud. CMS officials have repeatedly raised concerns that people are enrolled in ACA plans without their knowledge, or despite being deceased.
Earlier this week, the agency revealed it will purge 189,000 enrollees who are currently listed as enrolled in both ACA plans and other coverage, such as Medicaid or Medicare.