CMS published its 2027 Medicare Advantage and Part D proposed rule on Nov. 25 that includes an overhaul of how star ratings are calculated, new enrollment flexibilities, and rollbacks of Biden-era health equity requirements.
The proposed rule is subject to a 60-day public comment period. A final rule is expected in spring 2026, with most provisions taking effect for contract year 2027.
Seven notes:
1. The proposed rule would not implement the Excellent Health Outcomes for All (EHO4All) reward (previously called the Health Equity Index), which was finalized under the Biden administration and set to take effect in the 2027 star ratings. The measure was designed to reward plans for high performance among enrollees with social risk factors, including dual eligibles, low-income beneficiaries, and those with disabilities.
2. CMS is proposing eliminating 12 star ratings measures it characterizes as “focused on administrative processes and areas where beneficiaries cannot distinguish performance between plans due to high performance and little variation.” The shift in measure composition would increase the relative weight of HEDIS measures and CAHPS scores.
3. The proposal calls for adding a new Medicare Advantage depression screening and follow-up measure to address behavioral health gaps, starting with the 2027 measurement year and 2029 ratings.
4. CMS is proposing modifying the Special Enrollment Period to allow enrollees to change plans when one or more of their providers are leaving their plan’s network. The proposal removes the limitation on the existing SEP that requires the MA plan and then CMS to deem the network change as significant.
5. The rule proposes codifying Part D changes under the Inflation Reduction Act into permanent regulation, including eliminating the coverage gap phase, establishing a reduced annual out-of-pocket threshold, removing cost sharing for enrollees in the catastrophic phase, and implementing the Manufacturer Discount Program that replaced the Coverage Gap Discount Program in 2025.
6. The proposed rule would remove the requirements for MA utilization management committees to include a health equity expert member, for MA quality improvement programs to include activities specifically designed to reduce health disparities, and that MA plans send mid-year notices reminding enrollees about unused supplemental benefits.
7. CMS is seeking input on three areas for potential future policy:
- Competition and risk adjustment
“CMS recognizes that the current risk adjustment system may disadvantage smaller, newer, and less well-resourced plans and may encourage plans to prioritize investment in coding activities that could lead to MA plans coding more intensely than Original Medicare,” the agency wrote. “CMS is exploring modernization opportunities including a next-generation risk adjustment model that could leverage artificial intelligence and alternative data sources, as well as ways to streamline the quality measurement timeline and reduce the current two-year lag between measurement and payment.”
- C-SNPs vs. D-SNPs
CMS is concerned about significant enrollment growth in Chronic Condition SNPs (C-SNPs), with many dually eligible individuals enrolling in these plans rather than Dual Eligible SNPs (D-SNPs) that offer integrated Medicare-Medicaid benefits. In response, the agency is exploring whether to require state Medicaid contracts for C-SNPs and I-SNPs with high dual-eligible concentrations. - Well-being and nutrition
CMS is seeking input on policies to improve enrollee well-being, including emotional health, social connection, and life satisfaction, along with tools to achieve optimal nutrition and preventive care.
