Medicare Advantage Rates 2027 Rise 2.48%
CMS finalized Medicare Advantage rates 2027 with a 2.48% increase, adding over $13 billion in payments and reshaping insurers' 2027 revenue outlook.
KEY TAKEAWAYS
- CMS finalized a net 2.48% increase in Medicare Advantage payments for CY 2027, adding over $13 billion.
- The final rate materially exceeds the January advance notice's 0.09% proposal and its roughly $700 million impact.
- CMS will retain the 2024 MA risk-adjustment model and exclude unlinked chart-review diagnoses from risk scores.
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CMS finalized Medicare Advantage rates for 2027 with a net average 2.48% increase on April 6, 2026, raising payments to plans by more than $13 billion and altering the revenue outlook for insurers including CVS, Humana, Molina, and UnitedHealth.
Final Rate Increase and Risk Model Changes
The final 2.48% increase substantially exceeds the January advance notice’s proposed 0.09% rise, which would have added roughly $700 million. CMS retained the 2024 Medicare Advantage (MA) risk-adjustment model, calibrated with 2018 diagnoses and 2019 expenditures, instead of adopting the proposed 2023/2024 update.
Starting in 2027, CMS will exclude diagnosis information from unlinked chart-review records in risk-score calculations, while preserving an exception for diagnoses tied to enrollees who switch MA organizations. This adjustment affects plans operated by CVS, Humana, Molina, and UnitedHealth.
The payment increase reflects changes in utilization and prices, applies 2026 Star Ratings when calculating 2027 bonuses, and includes technical refinements to the risk model. CMS said it will consider public feedback on future updates to the risk-adjustment model.
Star Ratings Update and Part D Policy Changes
On April 2, 2026, CMS released the CY 2027 Medicare Advantage and Part D Final Rule, which introduces policy and technical changes alongside the Rate Announcement. The rule streamlines Star Ratings measures, adds a Depression Screening and Follow-Up measure, retains the Diabetes Eye Exam measure, and places greater emphasis on clinical quality, outcomes, and patient experience in bonus calculations and ratings.
The Final Rule also codifies Part D changes tied to the Inflation Reduction Act and clarifies rules on using debit cards for supplemental benefits, aligning plan operations with CMS’s payment and quality framework for 2027.
CMS said it will continue evaluating public feedback as it refines how diagnoses affect plan payments.
"The policies in this Rate Announcement are projected to result in a net average increase of 2.48%, or over $13 billion in additional MA payments to plans in CY 2027," CMS said.
