MedPAC Provides Context for Medicare Payment Policy, Reviews Part D and MA

The Medicare Payment Advisory Commission (MedPAC) met Sept. 3 and 4 to establish the context for Medicare payment policy, discuss issues and policy directions in Part D, and evaluate Medicare Advantage (MA) risk adjustment. This meeting marks the start of the 2026-2027 meeting cycle focused on a new analytical agenda. This cycle is led by new Commission Chair Amol Navathe, MD, PhD, and new Vice President Gregory Poulsen, MBA, and includes two newly appointed members, Benedic Ippolito, PhD, and Danielle Pierotti, PhD, RN. 

MedPAC commissioners began the meeting by reviewing the financial outlook for the Medicare program and its effects on the larger health care system.  This discussion will serve as a backdrop for their upcoming March 2027 report to Congress, which will review Medicare spending trends, the factors influencing projected spending, beneficiaries’ enrollment options and ability to afford care, and trends in provider consolidation. Commissioners then continued their work related to Part D plans by reevaluating pressures on premiums and spending introduced by recent policy changes, including the Inflation Reduction Act (P.L. 119-21, PDF). The commission discussed exploring policy options to address spending growth, such as redefining true out-of-pocket spending to exclude supplemental benefits, modifying benefit parameters to extend the initial coverage phase, and giving plans additional tools and flexibilities to manage spending.  

On Friday, commissioners reviewed the accuracy of MA risk adjustment. MedPAC identified aspects of the current risk adjustment model that impact accuracy and reviewed potential policies to improve MA risk adjustment, including using an encounter-based risk model and improving data inputs. The commission will continue to refine this work, including exploring alternative risk models, to present on this topic again in the spring and consider it for a chapter in the June 2027 report to Congress.