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NYSDOH Issues Notice to Terminate Section 1332 Waiver for Essential Plan
Per the notice below, the New York State Department of Health (NYSDOH) has issued notice that it will terminate the Section 1332 waiver under the federal Affordable Care Act that allowed for the creation of the expanded coverage of the Essential Plan for health insurance. NYSDOH seeks public comment on the notice within 30 days.
MEDICAID REDESIGN TEAM
Due to changes in federal law (H.R. 1, Public Law No: 119-21) that eliminate premium tax credit eligibility for half of current Essential Plan enrollees, New York expects to receive substantially less federal funding for its Section 1332 waiver. Given the magnitude of anticipated decreases in funding, New York will be unable to provide state funding to offset program costs. As a result, New York is requesting to terminate its 1332 waiver as currently approved and re-activate its (currently suspended) Basic Health Program (BHP). New York seeks to collaborate with CMS to design and provide affordable coverage options for members who will no longer qualify for current Essential Plan waiver coverage or the BHP. Termination of the 1332 Waiver will be effective within six months following the effective date of Section 71302 of the Reconciliation Act, Pub. L. 119-106. New York intends to implement these changes by July 1, 2026. Affected enrollees’ coverage will be transitioned to Qualified Health Plans with or without financial assistance depending on their income at that time. Those who are eligible for BHP coverage will remain in the Essential Plan under the BHP authority, experiencing no change in coverage.
The State will receive public comments during a 30-day comment period from September 10, 2025 – October 10, 2025, for consideration prior to submitting formal intent to phase out New York’s 1332 waiver and unsuspend New York’s BHP. NY State of Health will also be accepting written comments on this request. Written comments may be submitted to NYSOH.Team@health.ny.gov. More information on the Section 1332 Waiver can be found at: https://info.nystateofhealth.ny.gov/1332.
