HB7861, the “Care Over Profits Act of 2026,” would make two major changes to federal health insurance rules under the Public Health Service Act and the Affordable Care Act. First, it would raise the medical loss ratio requirement for health coverage in the small-group and individual markets from 80% to 85%, meaning insurers in those markets would have to spend a larger share of premium revenue on medical care and quality improvement rather than administration, marketing, or profit. This change would apply to plan years beginning on or after January 1, 2026.
Second, the bill would create stronger federal penalties for agents and brokers involved in enrollment in qualified health plans offered through ACA exchanges. It would authorize civil penalties for negligent or reckless submission of incorrect information and much larger civil monetary penalties, plus criminal penalties, for knowingly and willfully providing false or fraudulent information in exchange enrollment applications. These provisions would apply to enrollment applications for plan years beginning on or after January 1, 2027.
Impact
The bill would amend Section 2718 of the Public Health Service Act and Section 1411 of the Affordable Care Act, directly changing federal standards for health insurers and exchange enrollment intermediaries. For insurers in the individual and small-group markets, it would increase the minimum medical loss ratio threshold from 80% to 85%, potentially affecting pricing, rebates, and insurer spending patterns. For agents and brokers, it would add new enforcement tools, including substantial civil fines and criminal liability, to deter fraudulent or improper enrollment practices in ACA marketplace plans.
Sentiment
The available context shows no committee transcript, vote record, or formal debate, so there is no documented public sentiment from legislative discussion. Based on the bill’s structure and title, it appears to be framed as a consumer-protection and anti-fraud measure aimed at ensuring more premium dollars go to care and reducing abusive enrollment conduct. The absence of recorded votes or hearings means support or opposition cannot be reliably inferred from the provided materials.
Contention
The main points of contention likely concern the higher medical loss ratio requirement and the expanded penalties for agents and brokers. Insurers may view the 85% threshold as limiting flexibility and increasing rebate exposure, while consumer advocates may support it as a way to push more spending toward care. The broker and agent provisions could also be debated because they impose significant civil and criminal penalties for conduct tied to exchange enrollment, raising questions about enforcement standards, due process, and whether the penalties are proportionate to the misconduct targeted.