10 key Medicare Advantage updates in 2024

The first half of 2024 brought shifting trends for Medicare Advantage. 

Payers continued to warn of rising medical costs in the MA population, and some are predicting they will lose members next year. Insurers picked up a win in June when CMS said it would recalculate star ratings for 2024. 

Here are 10 key Medicare Advantage updates to know: 

1. CMS recalculated Medicare Advantage plans' star ratings after Elevance Health and SCAN Group successfully challenged a new methodology change in court. 
   
   
2. Some Medicare Advantage insurers may pare down their plan offerings in 2025. CVS Health said it expects to lose up to 10% of its Medicare Advantage members next year as it restructures its plan offerings. UnitedHealth and Elevance Health had a rosier outlook for 2025, suggesting they could pick up members who are leaving other plans.
   
   
3. Hospitals' contentious relationship with MA plans continued in the first half of 2024. Some systems in Indiana, Nebraska and New York dropped Medicare Advantage contracts, and one hospital CEO blamed delayed payments from MA plans for layoffs at his organization. Though some hospitals have broken up with Medicare Advantage plans, a UnitedHealth executive said on the whole, hospitals are sticking with it. 
   
   
4. The two-midnight rule took effect at the beginning of 2024. The rule requires MA plans to provide coverage for an inpatient admission when the admitting physician expects the patient to require hospital care for at least two midnights, otherwise known as the two-midnight rule. Hospital CEOs have expressed cautious optimism about the effects of the rule on reimbursement.
   
   
5. A co-branded Medicare Advantage plan offered by UnitedHealthcare and Walmart will come to an end amid the retailer's decision to close ​​its health centers and end virtual care services.
   
   
6. CMS issued its final 2025 Medicare Advantage and Part D rule in April, setting new standards around marketing, broker payments and prior authorization. Here are 11 key updates to know.
   
   
7. CMS finalized a slight decrease in Medicare Advantage benchmark payments for 2025 in April. The agency will cut benchmark payments by 0.16% from 2024 to 2025 but estimated plans will see 3.7% higher revenue overall. Payer industry executives decried the proposed rates, saying they were insufficient to cover rising costs in the Medicare Advantage market. 
   
   
8. Don Berwick, MD, who served as CMS administrator during the Obama administration, told Becker's he would like to see Medicare Advantage "slowed or stopped."
   
   
9. The Cigna Group reached a deal to sell its Medicare business to Health Care Service Corp. for $3.3 billion. The sale will nearly quadruple HCSC's Medicare Advantage membership. HCSC had 217,623 Medicare Advantage members in January 2024. Cigna has 596,977 Medicare Advantage members, a small share of its 19 million insurance members. 
   
   
10. Though MA enrollment keeps climbing, the program may not have the profitability it once did for insurers. Payers have warned of rising medical costs through 2024 and are facing lower reimbursement rates for 2025, leading some insurers to lower their earnings guidance for 2024.