The Centers for Medicare and Medicaid Services on April 6, 2026, finalized a net average rate increase of 2.48% for Medicare Advantage (MA) plan rates for Calendar Year (CY) 27. CMS originally proposed a 0.09% rate (essentially flat) in January 2026.
As in most years, final rates are often higher than proposed as CMS has additional data available upon which to base the rates. This year, it appears that CMS’s policy decision to not update the MA risk adjustment model for CY2027 also played a role in the upward adjustment. CMS opted to continue using the 2024 MA risk adjustment model.
The final rate notice also finalizes CMS proposals that begin to address what is often referred to as “upcoding” by the MA plans by prohibiting plans from using patient diagnoses obtained through unlinked chart reviews and audio-only visits. It is believed that these practices have driven up payments to MA plans, resulting in the Medicare Trust Fund paying plans more for a beneficiary than would have been paid by Medicare FFS. CMS is also finalizing its proposal to accelerate the transition of PACE organizations to the MA risk adjustment model for CY2027.
The fact sheet on the final MA/PACE rate notice can be found here.
