2027 Medicare Advantage and Part D Proposed Rule: CMS Modernizes Quality Metrics and Risk Adjustment

On November 25, 2025, the Centers for Medicare & Medicaid Services (CMS) released the Proposed Rule for 2027 Medicare Advantage (MA) and Part D programs, aiming to update and modernize key aspects of these programs. The Proposed Rule focuses on improving quality measurement, enhancing beneficiary protections, updating risk adjustment methodologies, and codifying changes stemming from the 2022 Inflation Reduction Act (IRA) related to Part D drug pricing. CMS has complemented the Proposed Rule with Requests for Information (RFIs) on risk adjustment, Quality Bonus Payments (QBPs), Chronic Condition Special Needs Plans (C-SNPs), and beneficiary well-being and nutrition policies. A central feature of the proposal is the codification of major IRA provisions, including the Manufacturer Discount Program and the phasing out of the Coverage Gap Discount Program, which until now have been implemented primarily through guidance rather than formal regulation. In the area of quality measurement, CMS proposes refining the Star Ratings system by adding a new depression screening and follow-up measure, while eliminating twelve existing measures deemed less effective at differentiating plan performance or more suitable for compliance monitoring. The removal of these measures is expected to produce a mixed effect on overall plan ratings, with some plans seeing increases and others decreases, and consequential impacts on supplemental benefits and plan finances. CMS is also withdrawing the previously planned Health Equity Index reward and instead retaining the historical reward factor to focus Star Ratings incentives more broadly on clinical care and outcomes across all enrollees. To ensure transparency, CMS plans to codify its current practice of sharing de-identified plan-level data during preview periods to enable plan sponsors to validate rating calculations. Marketing regulations for MA and Part D plans are proposed for revision to reduce beneficiary confusion and administrative burden, alongside initiatives to hold third-party marketing organizations accountable for non-compliance. The RFIs invite stakeholder input on modernizing risk adjustment beyond the current Hierarchical Condition Category (HCC) model to incorporate additional clinical and utilization data, aiming to align payment more closely with beneficiary health outcomes and reduce incentives for administrative coding improvement rather than meaningful care enhancements. Similarly, the QBP program is under review to address concerns over delayed performance feedback, score inflation, and competitive imbalances, with CMS exploring ways to accelerate quality incentive timelines and improve program accuracy. With the rapid growth of C-SNPs, CMS is actively seeking comments on potential new integration or contracting requirements akin to those applied to Dual Eligible Special Needs Plans (D-SNPs), aiming to ensure adequate Medicaid coordination and care management for dual eligible beneficiaries. Additionally, CMS is gathering feedback on policies to enhance beneficiary well-being and nutrition within MA programs, focusing on long-term health promotion through preventive care, mental health integration, and lifestyle factors. The Proposed Rule signals significant operational and strategic implications for MA and Part D organizations, prompting stakeholders to assess their readiness and participate in the comment process. Epstein Becker Green continues to monitor developments and offers legal and strategic support to affected entities. A detailed summary of added and removed Star Ratings measures delineates impacts on operational, process, and patient experience metrics for 2028 and 2029 rating years.