CMS 2027 MA Advance Notice Analysis

Introduction

CMS recently released the CY 2027 Advance Notice of Methodological Changes for Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies Advance Notice. BHA would like to share some hot topics we gleaned from the notice.

Net Impact

CMS provided the expected average impact of the proposals on MA payment components relative to last year.   

Key Provisions:

New! CMS proposed some significant changes for the Risk adjustment model:

• CMS proposed a 2027 CMS-HCC risk adjustment model by recalibrating risk coefficients using more recent data (2023 diagnoses and 2024 expenditures)

• They are set to exclude diagnoses from unlinked chart review records (CRRs) for CY 2027 when calculating risk scores.

Updates for Part C & D Star ratings

Reminders for 2027 Star Ratings and Beyond

Administrative data review deadlines (2027 and 2028 Stars)

For 2027 Star Ratings:

• March 31, 2026 – CTM data review requests
• May 18, 2026 – Part D Patient Safety administrative data review
• June 30, 2026 – Part C appeals data review

For 2028 Star Ratings:

• March 31, 2027 – CTM data review
• May 18, 2027 – Part D Patient Safety administrative data review

Measure additions and removals for 2027

As a reminder, there are four new or updated measures being added beginning with the 2027 Star Ratings:

• Colorectal Cancer Screening (It is being replaced by a respecified version and will be treated as a new measure) New!
• Care for Older Adults – Functional Status Assessment (returning after a substantive change)
• Concurrent Use of Opioids and Benzodiazepines (COB)
• Polypharmacy: Use of Multiple Anticholinergic Medications in Older Adults (PolyACH)

There are three measures being removed beginning with the 2027 Star Ratings:

• Care for Older Adults – Pain Assessment
• Medication Reconciliation Post-Discharge
• Medication Therapy Management (MTM) Program Completion Rate for Comprehensive Medication Review (CMR) - (Display only for MY25 and MY26. Will return as a new measure in MY27)

Other Changes:

Statin Therapy for Patients with Cardiovascular Disease (Part C): Underwent substantive spec changes from NCQA. The updated version will appear on the 2028 display page. CMS has proposed for removal from Star Ratings beginning in 2028. New!

CAI Methodology Updates: For the first two years post-consolidation, LIS/DE and disabled percentages for surviving contract will be calculated using combined December enrollment for the measurement period of the Star Ratings year across all merged contracts

Measure Changes for 2027 Star Ratings

Changes to Existing Star Ratings Measures for the MY27 and Beyond

New! Following are the measures being considered for changes by CMS in future: 

Plan All-Cause Readmissions (Part C)

CMS notes that NCQA is considering updates to include denied claims in identifying index admissions and readmissions, as well as re-estimating the risk adjustment model. CMS classifies these as substantive changes that would require display-page staging and rulemaking, with the earliest potential implementation in MY 2028

Transitions of Care (Part C)

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What is ECDS?

ECDS is a HEDIS reporting method for health plans collecting and submitting quality measures to NCQA. This reporting method includes standards that define the data sources and types of structured data acceptable for use for a measure. The ECDS reporting standard gives health plans a method for collecting and reporting standard electronic clinical data for HEDIS quality measurement and improvement.

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Diabetes Care – Blood Sugar Controlled (Part C)

CMS describes NCQA’s development of an ECDS-reported version of this measure, with parallel reporting alongside the hybrid version during MY27 and MY28. The hybrid measure is expected to be replaced by an ECDS-only version beginning in MY29.

Statin Use in Persons with Diabetes (SUPD) (Part D).

PQA updated the measure with a technical clarification based denominator exception. This change would be a non-substantive update because it is expected to slightly narrow the denominator population covered by the SUPD measure. CMS plans to add the denominator exception to the measure beginning with the MY26.

Polypharmacy: Use of Multiple Anticholinergic Medications in Older Adults (Poly-ACH) (Part D)

PQA notes a technical clarification to better identify multiple claims for the same target medication across dates of service. CMS classifies the update as non-substantive and plans to implement it beginning with the MY26.

Display Measure Updates

Follow-up After Hospitalization for Mental Illness (Part C): NCQA is considering to add POS 55 (Residential Substance Abuse Treatment Facility) to the numerator and remove the remaining mental health provider type requirement to align all behavioral health continuity measures by MY27.

Pharmacotherapy Management of COPD Exacerbation (Part C): NCQA is reevaluating the measure to align with updated clinical guidelines; it may be updated or replaced for MY27.

Hospitalization for Potentially Preventable Complications (Part C): NCQA is considering an update to allow denied claims in the numerator and re-estimate risk adjustment models to align with updated CMS HCC models, targeted for MY28.

Initiation and Engagement of Substance Use Disorder Treatment (Part C): NCQA plans to add guidance for MY27 to clarify that multi-day substance use withdrawal events must be deduplicated if a claim was generated daily for one withdrawal episode

Antipsychotic Use in Persons with Dementia (APD) (Part D): CMS plans to remove brexpiprazole from the measure, as it now has an FDA-approved indication for dementia agitation, effective MY26 (2028 display page).

Use of Opioids at High Dosage in Persons without Cancer (OHD) (Part D): CMS plans to update daily MME calculation methodology, including special handling for transdermal fentanyl patches, effective MY26 (2028 display page).

Retirement of Display Measures

Disenrollment Reasons Survey (Part C & D): Retire all measures derived from the survey due to no data, starting 2027 display

Antipsychotic Use in Persons with Dementia for Long-Term Nursing Home Residents (APD-LTNH) (Part D): CMS plans to retire the measure to reduce duplication and focus on the consensus-based APD measure, effective MY26.

Potential Methodological Enhancements for Future Years

New! As CMS continues to simplify the Star Ratings program, they are considering methodological enhancements to make the calculations easier to understand and implement, such as changes to simplify the methodology for determining measure thresholds.

• For example, one such approach could involve using percentile distribution cut offs to assign measure stars instead of the current clustering methodology for non-CAHPS measures

Stay tuned to get insights on how percentile cutpoints could impact plans!

Source:

1. CMS 2027 MA Advance Notice