Medicare Advantage Stars Release
CMS released the 2027 Medicare Advantage and Part D star ratings. The average MA-PD rating declined from 4.01 to 3.99 stars. Please see this Wakely analysis on changes to 2027 stars. Alignment Healthcare filed a lawsuit challenging its 2027 star rating and requesting the same methodology that CMS applied to Clover in 2026. Clover had its 2026 star rating recalculated as a result of winning a court case against CMS. CMS has since appealed that decision, and the outcome of that appeal is likely to determine whether Alignment’s lawsuit and similar cases will go forward.
340B Update
The American Hospital Association and other providers filed a lawsuit to stop the implementation of HHS’ revised 340B rebate policy. Under the program, participating drug manufacturers would provide 340B discounts through rebates after drug purchases rather than through the traditional upfront-discount mechanism. AHA estimates that annual administrative costs could exceed $1 billion, compared with the government’s estimate of approximately $537 million. The lawsuit requested an injunction before the policy’s January implementation.
ACA Updates
- CMS Removes Subsidies for 189,000 Enrollees – CMS announced that it had removed subsidies from 189,000 Marketplace enrollees who also had Medicaid coverage as part of the periodic data matching (PDM) process. This number is smaller than last year’s total, when 551,000 people had their subsidies removed. The removal of these individuals’ subsidies has implications both for MCOs and Marketplaces. No state-specific data was released.
- KFF Estimates on ACA Market – A new report from KFF estimates that the individual market shrank about 18% between June 2025 and June 2026.
No Surprises Act Watch
A congressman introduced a bill last week to eliminate the No Surprises Act (NSA) arbitration process and replace it with a requirement that plans pay providers a flat-out-of-network rate that aligns with in-network rates. Interest in changes to the NSA continues to grow. Both payers and providers are lobbying for changes. It will be difficult to make changes during this Congress, so action may not occur until next year.
