January 10, 2025
Contact: Jenifer Callahan
The newly released 2026 Medicare Advantage Advance Notice heralds a period of greater stability for the program than it has experienced in recent years, America’s Physician Groups (APG) said today. “The fact that payments to MA plans are expected to increase on average by 4.33 percent from 2025 to 2026 – the largest increase in several years – signals a more favorable environment for the MA ecosystem than we might have expected,” said Susan Dentzer, president and CEO of APG.
Although payments for MA proceed from the government to health plans, the plans in turn must contract with provider groups such as APG’s physician organizations to care for MA beneficiaries. “More resources will be helpful in ensuring that many of our groups can now care effectively for beneficiaries and meet their needs,” Dentzer said.
The favorable payment outlook for MA plans derives in part from a markedly higher-than-usual effective growth rate of spending in the traditional fee-for-service Medicare program, which the Centers for Medicare & Medicaid Services projects as being nearly 6 percent in 2026, up from just 2.3 percent a year ago. This high projected growth rate – the highest since 2014 – reflects the fact that utilization of health care services has been rising rapidly in the traditional Medicare population, as it has in recent years for the MA population.
CMS has based its Medicare growth rate projection for 2026 on relatively limited data from 2024, and a risk remains that the agency could revise the growth rate projection downward as more current utilization data comes in over the next few months. But for now, the positive trend bodes well for appropriate payment increases in MA reflecting a general trend toward the greater use of services.
“APG appreciates the fact that the Biden Administration intends to leave the MA program in a strong position to carry out its mission of serving the more than half of Medicare beneficiaries who now choose to enroll in MA,” Dentzer said. “Our member physician groups, who currently care for roughly 1 in every 3 MA enrollees, look forward to working with the incoming Trump administration to maintain and improve the program for the future.” ###
About America’s Physician Groups
APG’s approximately 360 physician groups comprise 170,000 physicians, as well as thousands of other clinicians, providing care to nearly 90 million patients, including about 1 in 3 Medicare Advantage enrollees. APG’s motto, ‘Taking Responsibility for America’s Health,’ represents our members’ commitment to clinically integrated, coordinated, value-based health care in which physician groups are accountable for the costs and quality of patient care. Visit us at www.apg.org.
