Medicare Advantage

CMS 2027 Medicare Advantage Proposed Rule: What Changes Mean for Your Coverage and Costs

The Centers for Medicare & Medicaid Services has released its proposed rule for 2027 Medicare Advantage plans, targeting star ratings accuracy, prior authorization burdens, supplemental benefit transparency, and payment benchmarks.

February 24, 2026·By Senior Health Times Editorial Team·✓ Reviewed April 2026

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Key Takeaways

✓CMS proposes revising the star ratings methodology for 2027 to reduce the weight of member complaints measures and increase the weight of clinical outcome measures, which could shift plan quality scores significantly.
✓The proposed rule would require Medicare Advantage plans to respond to standard prior authorization requests within 7 calendar days and urgent requests within 72 hours, with electronic submission mandated for all requests.
✓Supplemental benefits such as dental, vision, and hearing aids must be reported using standardized benefit codes under the proposal, making it easier for beneficiaries to compare offerings across plans on Medicare Plan Finder.
✓CMS projects a 2.2 percent increase in base payment rates for 2027 Medicare Advantage plans, though risk adjustment model updates may offset net revenue for plans with sicker enrollee populations.
✓Beneficiaries should review their current plan's star rating trajectory and supplemental benefit listings during the 2026 Annual Enrollment Period, as plan responses to these rule changes may alter premiums and covered services.

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The CMS 2027 Medicare Advantage proposed rule, released in early 2026, would reshape how plans are rated, how care approvals are processed, how extra benefits are disclosed, and how much the federal government pays plans per enrollee. Beneficiaries enrolled in any of the roughly 850 Medicare Advantage organizations currently operating nationwide have a direct stake in each of these four areas.

Star Ratings: Shifting the Scorecard

CMS uses a 1-to-5 star rating system to measure Medicare Advantage plan quality, and those ratings carry enormous financial consequences. Plans rated 4 stars or higher receive quality bonus payments that can reach hundreds of millions of dollars annually for large insurers. The 2027 proposed rule would restructure how individual measures are weighted within the overall score.

Under the proposal, clinical outcome measures — such as controlling blood pressure, managing diabetes, and cancer screening rates — would carry greater weight than they do today. Simultaneously, CMS proposes reducing the weight assigned to member complaints and call center performance measures, which critics have argued are easier to game through customer service investments than through actual clinical improvement.

The agency also proposes adding a new measure tracking timely follow-up after an emergency department visit for mental health conditions, reflecting the broader federal push to integrate behavioral health into Medicare Advantage quality accountability. Plans that have historically scored well on service metrics but lagged on clinical outcomes may see their star ratings decline under the revised formula, while clinically strong plans could see ratings rise.

What Lower Star Ratings Mean for Enrollees

A plan that drops below 4 stars loses its quality bonus payment. Plans that fall to 2.5 stars or below for three consecutive years face potential termination from the Medicare Advantage program. For enrollees, a rating drop often signals premium increases, benefit reductions, or both in the following plan year. Checking a plan's star rating history on Medicare.gov before each Annual Enrollment Period remains one of the most practical steps a beneficiary can take.

Prior Authorization: Faster Decisions Required

Prior authorization — the process by which plans must approve certain services before they are delivered — has been one of the most persistent sources of beneficiary complaints and congressional scrutiny. The 2027 proposed rule builds on the prior authorization transparency requirements finalized in 2024 and goes further on timelines.

CMS proposes that plans must render decisions on standard prior authorization requests within 7 calendar days, down from the current 14-day standard. Urgent or expedited requests would face a 72-hour decision window. The proposal also mandates that all prior authorization requests be submitted and processed electronically using standardized FHIR-based application programming interfaces, a technical requirement designed to reduce administrative friction for both providers and patients.

The rule would additionally require plans to publicly report their prior authorization approval and denial rates by service category on a quarterly basis, giving beneficiaries and researchers a clearer picture of which plans restrict access most aggressively. Denial rates for post-acute care services, including skilled nursing and home health, have drawn particular scrutiny from the HHS Office of Inspector General in recent years.

Appealing a Denial Under the New Framework

Even under the proposed faster timelines, beneficiaries retain the right to appeal any prior authorization denial through the plan's internal appeals process and, if necessary, through an independent review entity. Requesting an expedited appeal — which requires a decision within 72 hours — is appropriate when a standard timeline could seriously jeopardize health. Beneficiaries should ask their treating physician to document medical necessity in writing before submitting any appeal.

Supplemental Benefits: More Transparency, Clearer Comparisons

Medicare Advantage plans may offer supplemental benefits beyond original Medicare, including dental care, vision correction, hearing aids, fitness memberships, and over-the-counter allowances. These benefits have expanded rapidly since CMS broadened flexibility in 2019, but their inconsistent coding and description have made plan-to-plan comparison difficult.

The 2027 proposed rule would require plans to use a standardized set of benefit codes when submitting supplemental benefit data to CMS, and those standardized descriptions would feed directly into the Medicare Plan Finder tool on Medicare.gov. A beneficiary searching for a plan covering comprehensive dental services, for example, would see consistent, comparable descriptions rather than the marketing language that currently varies by plan.

CMS also proposes requiring plans to report actual utilization rates for supplemental benefits — meaning what percentage of enrolled members actually used a given benefit in the prior year. Low utilization rates on high-profile benefits have raised questions about whether some offerings are genuinely accessible or primarily serve as enrollment incentives.

Payment Changes: The 2.2 Percent Rate Update

CMS projects a 2.2 percent increase in the base payment rates that Medicare Advantage plans receive per enrollee in 2027, driven primarily by growth in the fee-for-service cost benchmarks that anchor MA payments. However, the agency is also updating its risk adjustment model — the formula that adjusts payments based on how sick a plan's enrollees are — to more accurately reflect actual healthcare costs.

The risk adjustment update removes several diagnostic codes that audits have found to be frequently upcoded, meaning plans were receiving higher payments than the clinical evidence supported. Plans that have relied heavily on chart review programs to capture additional diagnoses may see net payment reductions even as the base rate rises. The net combined impact on plan revenue will vary significantly by organization depending on their current coding practices and enrollee demographics.

For beneficiaries, payment changes translate indirectly into plan decisions about premiums, cost-sharing, and benefit generosity for the 2027 plan year. Plans facing tighter margins may reduce supplemental benefits or increase out-of-pocket maximums, which currently cannot exceed $9,350 for in-network services under existing CMS rules. Reviewing the Annual Notice of Change that plans must mail by September 30 each year is the most direct way to track how these financial pressures affect individual coverage.

Sources & Further Reading

Frequently Asked Questions

When will the CMS 2027 Medicare Advantage proposed rule take effect?

The proposed rule was released in early 2026 and is subject to a public comment period before CMS issues a final rule, typically in the spring of the same year. If finalized on schedule, the changes would apply to Medicare Advantage plan contracts beginning January 1, 2027. Beneficiaries would see the effects during the Annual Enrollment Period running October 15 through December 7, 2026.

How does the proposed prior authorization timeline change affect Medicare Advantage members?

Under the proposal, plans must decide standard prior authorization requests within 7 calendar days, cutting the current 14-day window in half. Urgent requests must be decided within 72 hours. Faster decisions reduce the risk of delayed care, particularly for post-acute services like skilled nursing facility stays and home health, which have historically faced high denial rates according to HHS Office of Inspector General reports.

Will the 2027 rule change what supplemental benefits my Medicare Advantage plan offers?

The rule does not mandate specific supplemental benefits, but it requires plans to use standardized benefit codes and report actual member utilization rates. This transparency push may lead some plans to discontinue low-utilization benefits and invest more in those members actually use. Beneficiaries should compare standardized benefit descriptions on Medicare Plan Finder rather than relying solely on plan marketing materials.

How do star rating changes under the 2027 proposed rule affect my plan's premiums?

Plans that drop below 4 stars lose quality bonus payments from CMS, which can reduce the revenue available to fund low premiums and rich supplemental benefits. A plan falling from 4 to 3.5 stars may respond by raising premiums or trimming benefits for the following year. Monitoring your plan's star rating on Medicare.gov each fall, before the Annual Enrollment Period closes, helps you anticipate these changes.

What is the proposed 2027 Medicare Advantage payment rate increase?

CMS projects a 2.2 percent increase in base payment rates for 2027. However, simultaneous updates to the risk adjustment model, which remove diagnostic codes identified as frequently upcoded, may reduce net payments for plans that have relied on aggressive chart review programs. The actual financial impact on individual plans will vary based on their coding practices and the health status of their enrolled populations.

How can I comment on the CMS 2027 Medicare Advantage proposed rule?

CMS accepts public comments through Regulations.gov during the official comment period following the rule's publication in the Federal Register. Beneficiaries, advocacy organizations, and healthcare providers can all submit comments. CMS is required to review and respond to substantive comments before issuing the final rule, typically in April of the year preceding the plan year in question.

Editorial Standards

This article was written by the Senior Health Times editorial team and is intended for informational purposes only. It does not constitute financial, legal, or medical advice. Coverage details and costs vary by plan, carrier, and state. Always verify information with official sources including Medicare.gov and your state insurance commissioner.

Medicare Advantage 2027CMS proposed ruleprior authorizationstar ratingssupplemental benefitsMedicare payment ratesrisk adjustment

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