Proposed Medicare Advantage Changes 2027
The Centers for Medicare & Medicaid Services (CMS) recently released a proposed rule for the 2027 contract year that could reshape Medicare Advantage (MA) and Part D prescription drug coverage. The agency aims to “strengthen quality, improve access, and modernize benefits” while reducing administrative burdens on plans.
Here’s what beneficiaries, providers, and policymakers need to know.
Star Ratings Overhaul
CMS proposes removing 12 Star Rating measures that are largely administrative or show little variation between plans. The focus will shift to meaningful metrics, including clinical outcomes, preventive care, and patient experience.
- New focus on outcomes: Plans will be evaluated more on health results than paperwork.
- Mental health measure: CMS plans to introduce a “Depression Screening and Follow-Up” measure for future cycles.
- Health equity bonuses paused: The previously planned “Excellent Health Outcomes for All” bonus is postponed, though CMS invites feedback on equity initiatives.
Impact: Beneficiaries may find it easier to identify high-quality plans, while insurers may redirect resources toward improving actual care.
Enrollment Flexibility
The proposed rule adds a new Special Enrollment Period (SEP) for beneficiaries whose providers leave a plan’s network. This allows mid-year plan changes without waiting for the regular enrollment window. CMS also codifies other existing SEP policies, making the system more consistent.
Impact: This change ensures continuity of care for people with chronic conditions or preferred providers.
Watch a video on the discontinued Medicare advantage plan special enrollment period
Part D and Drug Coverage Updates
The rule formalizes Part D reforms started under prior legislation, including:
- Eliminating the coverage gap (donut hole) phase.
- Maintaining reduced out-of-pocket thresholds.
- Removing cost-sharing in the catastrophic phase.
- Adjusting how True Out-of-Pocket (TrOOP) costs are calculated.
Impact: Beneficiaries gain more predictable and affordable prescription drug coverage.
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Reducing Administrative Burden
CMS proposes measures to reduce paperwork and regulatory complexity, such as:
- Exempting certain account-based plans from creditable coverage disclosures.
- Lifting requirements for mid-year notices about unused supplemental benefits.
- Removing some health-equity reporting mandates for plans.
Impact: Plans may operate more efficiently, but some transparency and oversight could be reduced.
Why It Matters
- Patient-focused quality: More emphasis on outcomes and experience could improve care.
- Drug cost protection: Part D reforms continue to protect beneficiaries from high out-of-pocket expenses.
- Flexible enrollment: The new SEP enhances access to care when providers leave networks.
- Efficiency vs. oversight: Streamlined administration may improve plan operations but reduce some accountability.
- Future reform: CMS is constantly making changes to improve MA plans, and stakeholders have the chance to provide input.
CMS’s 2027 proposed rule could bring meaningful improvements for beneficiaries while easing administrative burdens for insurers. The Star Ratings overhaul, enrollment flexibility, and Part D updates are poised to enhance care and reduce costs. However, reduced oversight and postponed equity initiatives highlight areas to watch as the public-comment process unfolds.