BMA Comment Letter: CMS’s Proposed 2027 Medicare Advantage Policies Would Threaten Higher Costs and Fewer Benefits for Seniors
WASHINGTON — Better Medicare Alliance (BMA), the nation’s leading research and advocacy organization supporting Medicare Advantage, submitted formal comments to the Centers for Medicare & Medicaid Services (CMS) on the Calendar Year 2027 Advance Notice, warning that the agency’s proposed payment policies would increase disruption for seniors.
“Millions of seniors who rely on Medicare Advantage are already facing higher costs and fewer benefits than they did just a few years ago, and this proposal would add to that instability,” said Mary Beth Donahue, President and CEO of Better Medicare Alliance. “Flat funding is not neutral — and when payments fail to keep pace with rising medical costs and utilization, it functions as a cut. This would result in higher out-of-pocket costs, reduced benefits, and fewer coverage options for seniors beginning in October.
“President Trump has made clear that protecting Medicare is a priority,” Donahue added. “The Final Rate Notice is an opportunity to deliver on that commitment by ensuring payment policies that preserve stability, affordability, and choice for more than 35 million Medicare Advantage beneficiaries.”
BMA urged CMS to revise their proposed growth rate because it is not adequate to cover rising medical costs. CMS is proposing an effective 0.09% payment increase for 2027, flat funding that would not keep pace with rising costs and utilization rates. According to a new analysis by BRG, a one-percentage-point change in the growth rate translates to roughly $12 per member per month, or $144 per beneficiary annually, underscoring how small shifts can materially affect plan payments.
Meanwhile, proposed risk adjustment changes would reduce Medicare Advantage payments by an average of $324 per beneficiary per year, or $27 per month, according to a new independent analysis by BRG. The analysis finds certain states — including Florida, Georgia, Texas, Missouri, and Nevada — would likely face even steeper reductions.
Taken together, the policies proposed by CMS risk accelerating an ongoing trend of plan exists and closures nationwide reducing coverage options and disrupting care for millions of seniors. Years of insufficient program funding and policy disruption are already affecting beneficiaries. An analysis published this month in JAMA found that nearly 3 million Medicare Advantage enrollees — one in ten — were forced to switch plans for 2026 due to insurer exits, a tenfold increase from historical averages and the highest forced disenrollment rate ever recorded. Seniors in rural areas were nearly twice as likely to face forced disenrollment.
Meanwhile, Medicare Advantage beneficiaries have experienced an average $900 increase in out-of-pocket maximums over the past two years, alongside reductions in supplemental benefits such as transportation and nutrition support.
What Seniors Could See if Finalized as Proposed
If CMS finalizes the Advance Notice as written, seniors may face:
- Higher maximum out-of-pocket (MOOP) limits
- Increased cost-sharing at the doctor’s office or pharmacy
- Reduced Part B premium buy-down benefits
- Fewer dental, vision, hearing, transportation, and over-the-counter benefits
- Plan exits and reduced coverage choices, particularly in rural and underserved communities
In its comments, BMA urges CMS to revise the growth rate assumptions to reflect real-world medical costs and utilization, pause risk model changes, and ensure payment policies support program stability.
Without a meaningful course correction, BMA warns that the disruption seniors experienced this year is likely to worsen.
Read the full comment letter here.
Read BRG’s full analysis here.
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Better Medicare Alliance is a community of hundreds of thousands of grassroots beneficiaries and 200+ ally organizations working to improve health care through a strong Medicare Advantage. Learn more at bettermedicarealliance.org.