The Centers for Medicare & Medicaid Services (CMS) released the Calendar Year (CY) 2026 Rate Announcement for the Medicare Advantage (MA) and Medicare Part D Prescription Drug Programs that finalizes the payment policies for these programs. This release — combined with the CY 2026 MA and Part D final rule that was released on April 4 — makes annual routine and technical updates to the MA and Part D programs.

The actions taken by CMS help protect beneficiaries and taxpayers from waste, fraud, and abuse, while also driving access to high-quality, affordable healthcare through Medicare Advantage. By finalizing these payment policies, CMS is ensuring that Medicare Advantage continues to offer access to critical services in an efficient, accountable manner, further strengthening the program’s ability to serve beneficiaries.

Payments from the government to MA plans are expected to increase on average by 5.06% from 2025 to 2026. This is an increase of 2.83 percentage points since the CY 2026 Advance Notice, which is largely attributable to an increase in the effective growth rate. The method for setting the effective growth rate is set in statute and represents the average expected change in the benchmarks, used to determine payment for MA plans, based on the growth in Medicare per capita costs. The effective growth rate is 9.04%, which is higher than the estimate of 5.93% in the CY 2026 Advance Notice. This change is primarily due to the inclusion of additional data on fee-for-service (FFS) expenditures, including payment data through the fourth quarter of 2024, which was not included on account of the early Advance Notice publication.

In CY 2024, CMS initiated a three-year, phased-in approach for removing the medical education costs — related to services MA enrollees receive — from the historical and projected expenditures supporting the FFS costs that are included in the growth rate calculations. For CY 2026, CMS will complete the phase-in of the technical adjustment by applying 100% of the adjustment for MA-related medical education costs.

CMS is also completing a three-year phase-in of improvements to the MA risk adjustment model that the agency finalized in the CY 2024 Rate Announcement, with the first year of the three-year phase-in starting with CY 2024. CMS is committed to expanding access to affordable, high-quality care through Medicare Advantage, while also implementing measures to safeguard beneficiaries and taxpayers from waste, fraud, and abuse. These ongoing improvements support a sustainable program that benefits both current and future Medicare recipients.

CMS is concurrently releasing the Final CY 2026 Part D Redesign Program Instructions that continue to implement the redesign of the Medicare Part D program. These instructions contain a detailed description of, and guidance related to, changes to the Part D drug benefit in place for CY 2026.

The CY 2026 MA and Part D Rate Announcement may be viewed at https://www.cms.gov/files/document/2026-announcement.pdf.

A fact sheet discussing the provisions of the CY 2026 Rate Announcement can be viewed at https://www.cms.gov/newsroom/fact-sheets/2026-medicare-advantage-and-part-d-rate-announcement.

The Final CY 2026 Part D Redesign Program Instructions can be found at https://www.cms.gov/files/document/final-cy-2026-part-d-redesign-program-instruction.pdf.

A fact sheet discussing the provisions of the Final CY 2026 Part D Redesign Program Instructions can be viewed at https://www.cms.gov/newsroom/fact-sheets/final-cy-2026-part-d-redesign-program-instructions

Underscoring the massive scale of America’s medical debt problem, a New York-based nonprofit has struck a deal to pay off old medical bills for an estimated 20 million people.

Undue Medical Debt, which buys patient debt, is retiring $30 billion worth of unpaid bills in a single transaction with Pendrick Capital Partners, a Virginia-based debt trading company. The average patient debt being retired is $1,100, according to the nonprofit, with some reaching the hundreds of thousands of dollars.

The deal will prevent the debt being sold and protect millions of people from being targeted by collectors. But even proponents of retiring patient debt acknowledge that these deals cannot solve a crisis that now touches around 100 million people in the U.S.

“We don’t think that the way we finance health care is sustainable,” Undue Medical Debt chief executive Allison Sesso said in an interview with KFF Health News. “Medical debt has unreasonable expectations,” she said. “The people who owe the debts can’t pay.”

In the past year alone, Americans borrowed an estimated $74 billion to pay for health care, a nationwide West Health-Gallup survey found. And even those who benefit from Undue’s debt relief may have other medical debt that won’t be relieved.

This large purchase also highlights the challenges that debt collectors, hospitals, and other health care providers face as patients rack up big bills that aren’t covered by their health insurance.

Read more.

Rural hospital leaders are questioning whether they can continue to afford to do business with Medicare Advantage companies, and some say the only way to maintain services and protect patients is to end their contracts with the private insurers

Medicare Advantage plans pay hospitals lower rates than traditional Medicare, said Jason Merkley, CEO of Brookings Health System in South Dakota. Merkley worried the losses would spark staff layoffs and cuts to patient services. So last year, Brookings Health dropped all four contracts it had with major Medicare Advantage companies.

“I’ve had lots of discussions with CEOs and executive teams across the country in regard to that,” said Merkley, whose health system operates a hospital and clinics in the small city of Brookings and surrounding rural areas.

Merkley and other rural hospital operators in recent years have enumerated a long list of concerns about the publicly funded, privately run health plans. In addition to the reimbursement issue, their complaints include payment delays and a resistance to authorizing patient care.

But rural hospitals abandoning their Medicare Advantage contracts can leave local patients without nearby in-network providers or force them to scramble to switch coverage.

Medicare is the main federal health insurance program for people 65 or older. Participants can enroll in traditional, government-run Medicare or in a Medicare Advantage plan run by a private insurance company.

In 2024, 56% of urban Medicare recipients were enrolled in a private plan, according to a report by the Medicare Payment Advisory Commission, a federal agency that advises Congress. While just 47% of rural recipients enrolled in a private plan, Medicare Advantage has expanded more quickly in rural areas.

In recent years, average Medicare Advantage reimbursements to rural hospitals were about 90% of what traditional Medicare paid, according to a new report from the American Hospital Association. And traditional Medicare already pays hospitals much less than private plans, according to a recent study by Rand Corp., a research nonprofit.

Read more.

The Centers for Medicare & Medicaid Services (CMS) updated their Hospital Price Transparency Fact Sheet with information on compliance and enforcement. Under Hospital Price Transparency, all hospitals, including Critical Access Hospitals (CAHs) and Rural Emergency Hospitals (REHs), and hospital-based departments – which may include some Rural Health Clinics – are required to post pricing information about the items and services they provide on a publicly available website. CMS audits hospitals and investigates complaints from the public to ensure compliance. They also leverage automation to perform over 200 comprehensive hospital reviews per month. Consistent with standing policies, CMS will address non-compliance with swift enforcement, and they are planning a more systematic monitoring and enforcement approach, per the Executive Order.  A variety of resources are available to help hospitals, CAHs, and REHs comply with these requirements.

“GOP lawmakers are hunting for ways to slash federal spending, a process that could mean cuts to Medicaid programs that support more than 3.1 million Pennsylvanians.” Mike Makosky, president and CEO of the Fulton County Medical Center, spoke to the USA TODAY Network about how the loss of federal dollars might undermine his hospital’s ability to provide health care in this rural southcentral Pennsylvania community.” Source: USA Today Network

With the rash of benefit thefts from consumers utilizing the Supplemental Nutrition Assistance Program (SNAP), the PA Department of Human Services is suggesting recipients change their EBT card pins ahead of their monthly benefit distribution. The theft of benefits rarely happens right away but thieves wait until the monthly distribution occurs to steal benefits. Recipients can call DHS’ EBT Recipient Hotline at 1-888-EBT-PENN or use the mobile app ConnectEBT to change their PIN numbers. Consumers are also urged to take extra steps to ensure that where they are utilizing their cards for point-of-sale transactions do not have skimming devices attached. Read here for more tips.