The Medicare Payment Advisory Commission (MedPAC) met on Jan. 15 and 16 to vote on recommendations for payment updates for physician services and hospital inpatient and outpatient services, in addition to other care settings. Commissioners also reviewed status reports related to Part D plans and Medicare Advantage (MA) plans.
The commission voted to approve a draft recommendation that Congress should increase physician payment rates by 0.5 percentage points for 2027, though two commissioners abstained from voting. Commissioners noted that the recommended 2027 payment update, if adopted by Congress, would result in a payment cut in comparison to 2026 rates due to the expiration of the One Big Beautiful Bill Act’s (P.L. 119-21) one-time 2.5% payment increase. While commissioners largely supported the recommendation, many emphasized the need to improve the underlying payment system to maintain appropriate access to care for Medicare patients.
The commission also presented and voted on a draft recommendation for hospital inpatient and outpatient services. The draft recommends Congress, for 2027, update the 2026 Medicare base payments for general acute care hospitals by the same amount specified in current law. The recommendation also calls for Congress to implement the Medicare Safety-Net Index (MSNI) described in the commission’s March 2023 report with $1 billion added to the MSNI pool [refer to Washington Highlights, March 17, 2023]. The majority of commissioners voted to adopt the recommendation except for two commissioners who abstained from voting. The recommendation will appear in the MedPAC’s March 2026 report to Congress.
Commissioners also reviewed Part D and MA status report chapters that will also appear in MedPAC’s March 2026 report to Congress. Related to Part D, the commission discussed beneficiary access to drugs may be affected by pharmacy availability, changes to low-income subsidy benchmarks, and the impact of maximum fair price on drug pricing. In the MA status report session, commissioners reviewed and discussed trends in MA enrollment, supplemental benefits, coding intensity, favorable selection, and enrollment of beneficiaries with end-stage renal disease.