Health Care Matters | December 5
Key Changes in the CY 2027 MA & Part D Proposed Rule
CMS released the CY 2027 Medicare Advantage (MA) and Part D Proposed Rule, with updates focused on Star Ratings, health equity measure removals, Special Enrollment Period (SEP) protections, Marketing and Communications oversight, and codification of key Inflation Reduction Act (IRA) Part D reforms. These changes would reshape how plans are evaluated, how beneficiaries can switch coverage when their providers leave a network, how plan materials and marketing activities are supervised, and how Part D benefit redesign is implemented in coming years.
The rule would forgo implementation of the Health Equity Index (HEI/EHO4All) reward, reverting to the traditional historical reward factor and eliminating the equity-based bonus for socially at-risk beneficiaries. It also calls for the removal of several administrative and process Star Ratings measures that CMS considers operational, burdensome, and/or duplicative.
CMS also proposes creating a provider-network SEP that allows beneficiaries to move plans mid-year without meeting the prior “significant network change” threshold. Marketing and communications proposals would update TPMO definitions, documentation standards, and translation and communication requirements to strengthen beneficiary protections and reduce misleading or confusing plan outreach. Part D updates would formally codify benefit changes already underway under the IRA, including the manufacturer discount program, TrOOP calculations, and specialty-tier rules.
The rule also includes a number of Requests for Information (RFIs) including a joint CMS–CMMI Request for Information (RFI) on longer-term reforms, such as risk-adjustment modernization, quality bonus timing, and well-being supports.
Check out some additional insights from McDermott+ and the CMS fact sheet for a deeper look at the proposed changes.
Why It Matters
These proposals represent meaningful shifts in how MA plans will be measured, monitored, and held accountable. Changes to Star Ratings, particularly the removal of the HEI factor (EHO4all) and several other measures, will alter bonus eligibility and redistribute quality bonus dollars across the MA market. New Special Enrollment Period flexibilities strengthen beneficiary protections and may increase mid-year switching, affecting attribution stability and downstream provider relationships. Updates to marketing and communications oversight aim to curb misleading outreach and improve the clarity and accuracy of plan information, which has implications for enrollment patterns and consumer trust.
Codifying IRA Part D reforms formalizes the most significant benefit redesign in the program’s history, requiring ongoing operational alignment from plans and PBMs. While the CMS–CMMI RFI does not introduce immediate policy changes, it signals CMS direction and that future MA model tests may still be early-stage, as CMS will gather additional stakeholder input before rolling out the next iteration of MA demonstrations. Collectively, these proposals shape the environment in which MA organizations, health systems, and ACOs will operate in the coming years.
House Approves 5-Year Extension for Hospital-at-Home Waiver
The House of Representatives voted unanimously to extend the Acute Hospital Care at Home waiver for five years through 2030, sending the bill to the Senate for consideration. The legislation would break the pattern of short-term renewals tied to federal funding deadlines and offer long-term regulatory stability for more than 400 participating hospitals nationwide. Recent reporting highlights strong bipartisan support for the extension and notes that the program has helped hospitals manage capacity constraints, deliver inpatient-level care in home settings, and test lower-cost, technology-enabled alternatives to traditional hospital stays. Read more here and here.
Why It Matters
The Senate's reception appears favorable, with advocates noting that multiple senators have championed the legislation, though the specific legislative vehicle for passage remains uncertain. If enacted before the January 30, 2026, deadline, the five-year extension would end the cycle of short-term renewals that has forced hospitals to operate hospital-at-home programs under persistent threat of shutdown. This stability is expected to accelerate adoption of home-based acute care as a core component of capacity management and value-based care strategies, particularly for organizations operating under shared-savings, bundled payment, or capitated models. Beyond immediate program stability, the extension signals congressional willingness to modernize where Medicare pays for inpatient care, which could set precedent for future site-of-care flexibility across government programs and influence how commercial insurers approach home-based acute care reimbursement.
Look for the Helpers: Building Community and Empathy Through Health Care Book Clubs
NYU Langone is using a simple but powerful idea to deepen empathy and improve patient experience: a book club that brings staff, patients, and caregivers together to reflect on shared stories. By creating a space for open dialogue about lived experiences, the program strengthens trust, builds community, and supports more person-centered care. This relational approach shows how small, low-cost interventions can meaningfully improve connection and understanding within complex health systems. Read more here.
What We're Writing
CMMI Launches New Technology-Supported Chronic Care Model: What You Need to Know About ACCESS
In our latest blog, we break down CMMI’s new ACCESS Model, a 10-year voluntary payment model that introduces outcome-aligned payments to support technology-enabled chronic care across hypertension, diabetes, musculoskeletal pain, and behavioral health. We outline how the model works, who can participate, what organizations should do to prepare, and how ACCESS fits into the administration’s broader shift toward continuous, tech-supported care delivery. Read the full post here.
What We Are Reading
Building The Future Of Tech-Enabled Health Care: Let Accountable Care Lead The Way
A new Health Affairs article argues that accountable care organizations are uniquely positioned to accelerate tech-enabled, data-driven care delivery through better integration of digital tools and value-based models. Read here.
Medicare ACOs In 2024: Increased Participation And Evolving Policy Impacts
A recent Health Affairs Forefront piece finds that ACO participation is rising in 2024 as organizations evolve their models to adapt to changing payment and care-delivery pressures. Read here.
CMS releases CY 2026 Outpatient Prospective and Ambulatory Surgical Center Payment Systems Final Rule
A new McDermott+ analysis outlines how the CY 2026 Outpatient Prospective Payment System and Ambulatory Surgical Center payment rule will reshape reimbursement and regulatory requirements for outpatient and ASC services. Read here.
Mapping the Uneven Burden of Rising ACA Marketplace Premium Payments due to Enhanced Tax Credit Expiration
A new brief from Kaiser Family Foundation maps how 2026 ACA Marketplace premiums could increase sharply if the enhanced premium tax credits end, estimating out-of-pocket premium payments for many enrollees would more than double year-over-year. Read here.
New Resource
Maturing in Risk: Unlocking Value Through MSSP Participation
A new issue brief from the Health Care Transformation Task Force explores how health systems and provider organizations can mature their risk-bearing capabilities through participation in the Medicare Shared Savings Program. The brief outlines strategies for building robust infrastructure, leveraging data analytics, coordinating care, and managing performance, helping organizations navigate common challenges and maximizing shared savings opportunities. Read here.
