Insights: Policy

Medicare Advantage (Policy/Technical Rule)

CMS released the Contract Year 2027 Policy & Technical Changes final rule for the Medicare Advantage (MA) program. CMS eliminated the Biden-era Excellent Health Outcomes for All (Health Equity Index) reward and removed 11 of the 12 proposed measures from the program (retaining only the Diabetes Care – Eye Exam measure), while adding a new...

Medicare Advantage (Rate Rule)

CMS issued the Calendar Year 2027 Announcement of Medicare Advantage (MA) Capitation Rates. The finalized net average year-over-year MA payment increase is 2.48%, higher than the 0.09% proposed in the January Advance Notice. When including the expected MA risk score trend, the effective increase is 4.98%.

Macro, Miscellaneous

Defense (FY27 Funding, Reconciliation, Iran Supplemental)

The White House has unveiled President Trump's FY27 budget, which made some high-level requests on defense, including $1,115b for baseline spending to be provided via the bipartisan appropriations process. The administration separately requested an additional $350b in baseline defense spending to be provided via the partisan reconciliation...

Medicare Inpatient Psychiatric Facility (IPF) Reimbursement

CMS released the proposed rule for the FY27 Inpatient Psychiatric Facility (IPF) Prospective Payment System (PPS). The agency is proposing a 2.3% net payment rate increase (3.1% IPF market basket update minus 0.8% productivity adjustment), projected to increase overall Medicare payments to IPFs by $50m over FY26.

Medicare Inpatient Rehabilitation Facility (IRF) Reimbursement

CMS released the proposed rule for the FY27 Inpatient Rehabilitation Facility (IRF) Prospective Payment System (PPS). The agency is proposing a 2.4% net payment rate increase (a 3.2% market basket update minus a 0.8% productivity adjustment). After updating the outlier threshold, the effective overall payment growth is approximately 2.8% per...

Medicare Hospice Reimbursement

CMS released the proposed rule for the FY27 Hospice Wage Index & Payment Rate Update. The agency is proposing a 2.4% net payment rate increase – comprising a 3.2% market basket update minus a 0.8% productivity adjustment – projected to result in roughly $785m in additional Medicare payments to hospice providers over FY26.