2027 Medicare Advantage Advance Notice Analysis

BRG experts estimated certain effects of the Centers for Medicare & Medicaid Services’ “Advance Notice of Methodological Changes for Calendar Year (CY) 2027 for Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies” (AN). John Barkett, Eric Hammelman, and Gregory Johnson find:

• Payments to MA plans would increase by around $12 per member per month (PMPM), or $144 annually, for every additional 1 percent added to the 2027 effective growth rate.
• The risk model changes proposed in the AN (not including elimination of unlinked charts) would reduce total payments to MA plans by $27 PMPM, or $324 annually, from what they would be otherwise.

The research and analyses performed in preparing this paper were sponsored by Better Medicare Alliance.