Approximately 450,000 New Yorkers enrolled in the Essential Plan will grow eligible for Qualified Health Plans beginning July 1, 2026, following federal approval for New York State to terminate its Section 1332 State Innovation Waiver and return to Basic Health Program authority.
Coverage Changes on the Horizon
The New York State Department of Health announced the update on March 23, 2026, after receiving approval from the Centers for Medicare & Medicaid Services (CMS). This transition will preserve Essential Plan coverage for roughly 1.3 million New Yorkers with incomes below 200 percent of the federal poverty level.
State Health Commissioner Dr. James McDonald stated, “Our priority is to ensure New Yorkers continue to have access to affordable, high-quality coverage.” NY State of Health Executive Director Danielle Holahan added, “No New Yorker should have to choose between keeping the lights on and seeing a doctor.”
Financial Implications for Enrollees
The shift to Qualified Health Plans could mean higher costs for the 450,000 affected New Yorkers. Qualified Health Plans may include monthly premiums and higher deductibles compared to the Essential Plan’s $0 premium and minimal cost-sharing. Even with federal tax credits, enrollees may face significant out-of-pocket expenses.
The loss of funding for the expanded Essential Plan stems from H.R. 1 (Public Law No. 119-21), federal legislation championed by Congressional Republicans. The state is working with insurers to reduce deductibles by half for those transitioning mid-year.
Further compounding affordability concerns is the expiration of enhanced premium tax credits at the end of 2025, originally established under the American Rescue Plan Act of 2021. Without these credits, Qualified Health Plan premiums are nearly 40% higher.
Next Steps and Assistance
Impacted enrollees will be notified on April 1, 2026, with information about their options. NY State of Health will expand outreach and enrollment assistance to help members navigate the Qualified Health Plan market.
Frequently Asked Questions
What is happening with the Essential Plan?
Approximately 450,000 New Yorkers currently enrolled in the Essential Plan will transition to Qualified Health Plans beginning July 1, 2026.
Why are these changes happening?
The changes are a result of federal approval for New York State to terminate its Section 1332 State Innovation Waiver, due to the elimination of funding for the expanded Essential Plan through federal legislation, H.R. 1.
What support is available for those affected?
NY State of Health will expand outreach and in-person enrollment assistance to help members find affordable coverage under the Qualified Health Plan market. Impacted enrollees will be notified on April 1, 2026, outlining their options.
How will these changes affect access to healthcare for New Yorkers?
