April 7, 2025
Contact: Erin Hemlin, APG Vice President of Communications
Tel: 202-770-1901
WASHINGTON — Physician groups participating in Medicare Advantage (MA) plans will see a relatively more stable MA environment next year because of the final 2026 Medicare Advantage rate notice newly released by the Centers for Medicare & Medicaid Services (CMS), America’s Physician Groups said today.
The rate notice projects that revenues for MA plans will grow more than 5 percent over 2025 levels, in large part because government payments to health plans will reflect substantial recent increases in health care utilization in the traditional Medicare program. That in turn suggests that payments to the physicians and other providers who deliver care to MA enrollees are likely to be more stable as well.
“CMS’s recognition that the utilization of health care services has risen sharply in recent months in the traditional Medicare program, and the resulting increase in the benchmark for the government’s MA payments to plans, are a welcome recognition of reality,” said Susan Dentzer, APG’s President and Chief Executive Officer. “The CMS projection of a solid revenue increase across MA plans recognizes that this uptick in utilization requires that more financial resources must be channeled into the MA sector to meet beneficiaries’ growing care needs.”
At the same time, next year’s MA payment rates will reflect the third year of phase-in of the new risk adjustment model that CMS adopted in 2023, and which has caused considerable adjustments by many MA plans and APG members. “We will continue to analyze the potential effects on our groups’ ability to care for patients,” said Dentzer, along with potential changes in MA Star Ratings and additional changes in the county-level payments to MA plans.
APG also expressed gratitude to CMS for expressing its commitment in the rate notice to simplifying and refocusing the quality measures incorporated into Star Ratings, and to focus more on clinical care, patients’ outcomes, and patients’ experience of care in future measures. “We look forward to working with the agency to achieve these goals,” as well as others that APG set forth in its recently released report, Medicare Done Right: Prescriptions for Success, Dentzer said.
APG is the leading organization representing physicians engaged in value-based payment models, and the more than 200,000 clinicians affiliated with its member groups provide care to roughly 1 in 3 MA enrollees nationwide. Studies have shown that APG groups engaged in full-risk relationships with MA plans produce superior outcomes for MA enrollees and other Medicare beneficiaries.[1]
[1] See Cohen KR et al, Medicare Risk Arrangement and Use and Outcomes Among Physician Groups. JAMA Netw Open. 2025; 8(1):e2456074. 10.1001/jamanetworkopen.2024.56074; also Vabson B, Cohen K, Ameli O, et al. Potential spillover effects on traditional Medicare when physicians bear Medicare Advantage risk. Am J Manag Care. Published online February 26, 2025. doi:10.37765/ajmc.2025.89686.
