CMS is raising Medicare Advantage payments by 2.48%, or more than $13 billion, according to its finalized 2027 rate announcement.
The agency said April 6 that when estimated risk score trends in MA are accounted for, the final rate amounts to a 4.98% payment increase. Following 2026’s 5.06% increase, CMS proposed a nearly flat 0.09% MA rate change in January. The advance notice received a record of nearly 47,000 comments in response.
Here are six other notes from the announcement:
1. The effective growth rate jumped from 4.97% in the advance notice to 5.33% in the final announcement, stemming from the inclusion of original Medicare program experience data through the fourth quarter of 2025.
2. CMS is holding firm on applying the statutory minimum MA coding pattern difference adjustment of 5.9%.
3. CMS is not moving forward with its proposed risk adjustment model for 2027. The agency will continue using its 2024 MA risk adjustment model, built upon original Medicare 2018 diagnoses and 2019 expenditure data.
4. CMS is finalizing the exclusion of diagnoses from unlinked chart review records from risk score calculations, while establishing an exception for beneficiaries who switch MA plans.
5. The agency is finalizing changes to the Part D risk adjustment model to encompass Inflation Reduction Act updates for 2027 and exclude audio-only and unlinked chart review record diagnoses. CMS will also distinguish between MA prescription drug plan and standalone drug plan beneficiaries through separate normalization factors.
6. For 2027, the standard Part D deductible will rise from $615 to $700, and the annual out-of-pocket threshold will rise from $2,100 to $2,400.
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