A long-running legal battle over the definition of employment is drawing significant attention from health policy experts. The case could affect how people access health insurance, potentially leading to more affordable but less comprehensive coverage that may lack consumer protections. Recent court documents suggest a settlement with the Department of Labor might be in the works, though the terms are still unclear. This comes at a time when health insurance premiums on the Affordable Care Act (ACA) marketplaces have been rising, causing many to drop their coverage. The Trump administration had pushed for expanding access to alternative insurance, such as short-term plans that avoid ACA rules on preexisting conditions and coverage requirements. The plaintiff in the case, Data Marketing Partnership, filed its lawsuit against the Department of Labor in 2019. It seeks to be recognized as an employer so that its limited partners can purchase job-based health insurance that doesn’t have to follow state insurance rules or meet ACA standards for coverage. To qualify, individuals must download an app that tracks their internet searches, allowing the company to sell that data. While some may find this appealing as a way to access insurance, others may be concerned about their online activity being monitored. The court’s decision on whether these individuals can be considered employees could have wide-reaching effects. Some experts warn that if the court rules in favor of the plaintiff, it might lead to the growth of insurance plans that are less regulated and offer limited consumer protections. These plans could be aggressively marketed and may not provide the same level of coverage as ACA-compliant options. The Department of Labor has consistently opposed the plaintiff’s claim, arguing that people who simply download software to track their online activity are not employees or legitimate partners. In 2020, the agency issued an advisory opinion stating this. However, a Texas district court ruled in favor of Data Marketing, calling the advisory opinion "arbitrary and capricious." The 5th Circuit Court of Appeals largely upheld that decision but asked the lower court to reconsider whether these individuals are considered "working owners" or "bona fide partners." If the court rules in favor of Data Marketing, it could weaken state regulatory authority over health insurance. Some states have already taken action against companies offering limited-partnership insurance. For example, Maryland fined a company in 2024, and Washington ordered another to stop offering such plans and imposed a $25,000 fine in 2021. Maine and Connecticut have also issued warnings about these plans, noting that they may not offer comprehensive coverage and could leave consumers with significant medical bills. Supporters of these limited-partnership plans argue they provide an additional, more affordable option for consumers, especially those who earn too much to qualify for ACA subsidies. Some states have even urged the Department of Labor to support Data Marketing’s request. Critics, however, warn that these plans could draw healthier, younger individuals away from the ACA market, potentially raising premiums for those who remain. The case remains in litigation, and neither the White House nor the Centers for Medicare & Medicaid Services have commented on the administration’s stance on these plans.