CMS finalized its Medicare Advantage and Part D rate announcement for contract year 2027 on April 6, 2026, setting an average expected rate increase of 2.48 percent — a figure insurers read as friendlier than the proposal, and one that shapes next year's plan benefits, networks, and premiums for the more than half of Medicare beneficiaries now enrolled in MA.
This article publishes information, not insurance advice. Plan availability changes every fall, so verify 2027 options against your own doctors and drugs during the October-December open enrollment window.
What did CMS finalize on April 6?
Per the Federal Register rule published April 6, 2026, the final 2027 rate announcement projects effective growth rate and risk-score updates that average a 2.48 percent increase in expected revenue for MA plans. That landed above the industry's fears: the advance notice had assumed higher coding-trend reductions, and the final rule softened them. Consumer advocates, including the Center for Medicare Advocacy, argued CMS eased up on tighter oversight it had promised; industry analysts called the numbers favorable to plans.
Related stories: UnitedHealth's Q1 2026 Cost Ratio Eased to 83.9 Percent · MedPAC's June Report Lands With Medicare Advantage at 55 Percent.
Why does a 2.48 percent number matter to a beneficiary?
The rate announcement is the revenue side of every MA plan's budget. Higher expected payments generally mean insurers can hold premiums flat, add back dental or vision extras cut in the lean 2026 plan year, or stay in counties they were considering leaving. Lower rates do the opposite: 2026's retrenchment — insurers shedding plans and roughly one in ten MA enrollees forced to switch plans, per Johns Hopkins-led analysis — followed years of tightening.
How does this compare with 2026?
For 2026, CMS finalized a 5.06 percent payment increase. The 2027 number of 2.48 percent is lower in headline terms but arrived with accounting choices insurers viewed as supportive. Payment levels are only half the story: MA revenues also depend on risk-adjusted coding, which CMS continues to audit through RADV actions.
What to watch next
Insurers will bid for 2027 by early June, and CMS releases plan-level results in the fall. If you are in an MA plan, the practical move comes in October: compare your plan's 2027 annual notice of change — premium, drug tiers, prior authorization list — against at least one alternative, including original Medicare plus a Medigap quote, before December 7.
For more context, read MedPAC's June Report Lands With Medicare Advantage at 55 Percent.
For more context, read unitedhealth q2 2026 earnings.
For more context, read UnitedHealth's Q1 2026 Cost Ratio Eased to 83.9 Percent.