Dually eligible individuals are those who qualify for both Medicare and Medicaid. This population accounts for a disproportionately small share of the total Medicaid or Medicare population, but they account for a disproportionately large share of spending across both programs.
Medicare Advantage Dual Eligible Special Needs Plans Play a Key Role
Over the last several decades, federal and state policymakers have developed and implemented a range of programs, demonstrations, and approaches to improve care for this population and strengthen alignment between Medicare and Medicaid, improve outcomes, and manage costs. Medicare Advantage (MA) Dual Eligible Special Needs Plans (D-SNPs) are a key vehicle to accomplish federal and state goals.
What to Expect in Medicare Advantage Contract Year 2026
In 2026 and beyond, we can expect significant state and local shifts in plan enrollment, due to new federal requirements and state demonstration program transitions. We will see states focused on advancing aligned plan enrollment and setting higher expectations for Medicare-Medicaid integrated programs.
A New Inventory to Stay on Top of State Markets
Health Management Associates (HMA) has published the Duals Integration Environmental Inventory, a state-by-state view of state Medicaid program structures and regulations shaping integration and D-SNP markets. This resource is designed to help state policymakers, insurers, and healthcare organizations track trends, identify opportunities, and inform strategic planning in an evolving policy landscape.
Looking Ahead at the Changes in 2026 and Beyond
Federal rules for the Medicare Advantage 2026 contract year—and state Medicaid contractual agreements with plans—strengthen D-SNP integration standards and coordination between states and plans. Examples include:
- D-SNP Look-Alike Plans: In 2026, the threshold for identifying MA plans as D-SNP look-alikes will decrease from 70 percent to 60 percent. This 10-percentage point drop marks the second of two planned phasedowns in the threshold percentage. Look-alike plans are MA plans that are marketed to dually eligible individuals, but they are not required to comply with D-SNP integration requirements. Stronger federal standards will require MA look-alike plans with high dual enrollment to convert or exit the market, which is expected to lead to shifts in dually eligible enrollment into D-SNPs and other integrated products.
- Financial Alignment Initiative Demonstration Transitions: The Centers for Medicare & Medicaid Services (CMS) has worked with several states operating capitated Financial Alignment Initiative (FAI) demonstrations to transition Medicare-Medicaid Plans (MMPs) to integrated D-SNPs by January 1, 2026. These states include Illinois, Massachusetts, Michigan, Ohio, Rhode Island, South Carolina, and Texas will end their FAI demonstrations on December 31, 2025.
- 2027 D-SNP Rules: Beginning in 2027, D-SNPs affiliated with Medicaid managed care organizations (MCOs) must restrict enrollment to Medicaid MCO enrollees. In addition, federal rules will limit the number of D-SNP plan benefit packages, which will require additional coordination with Medicaid affiliates and planning in designing benefit packages and network.
State Medicaid Program Adjustments
States are working to align new federal D-SNP requirements with existing Medicaid managed care contracts, long-term services and supports carve-in strategies, and service-area mappings. Because State Medicaid Agency Contracts (SMACs) must be updated annually, all SMACs will need to incorporate the new D-SNP provisions as the new requirements take effect. This effort will require close coordination among state agencies, plans, and CMS to manage enrollee transitions, data-sharing, and communications.
Data-Informed Integration Insights
HMA’s Duals Integration Environmental Inventory is a single hub for insights into requirements, approaches to scope of integration programs, and enrollment data. The inventory will help plans and other types of organizations such as providers and community-based organizations to prepare for future contracting, compliance, and operational transitions.
This inventory is designed to answer the four major questions top of mind:
- What is the state’s integration model and D-SNP type. The inventory identifies each state’s approach to integrating care for dually eligible populations, including states with Fully Integrated Dual Eligible Special Needs Plans (FIDE-SNPs), Highly Integrated D-SNPs (HIDE-SNPs), coordination-only models, and Exclusively Aligned Enrollment (EAE) initiatives or comparable rules
- Does the state’s program integrate LTSS and/or Behavioral Health? The inventory details whether long-term services and supports and behavioral health are carved into or out of managed care and how those benefits interact with Medicare coverage within D-SNP structures
- What is the state’s enrollment policy? The inventory captures enrollment in HIDE/FIDE products, identifies Applicable Integrated Plan (AIP) states, and gauges overall alignment maturity
- What is the state’s procurement and contract timeline? The inventory also tracks state procurement timelines, upcoming RFPs, and effective contract dates
Connect with Us
HMA experts are tracking state integration strategies, procurement timelines, and future state planning activities. Beyond the tracker, HMA colleagues provide tailored analysis and planning for state-specific initiatives. Our team can help health plans prepare for enrollment shifts, compliance requirements, and integration opportunities in 2026 and beyond. For information about subscription access to the HMA Information Services (HMAIS) inventory and to connect with HMA consultants who can address your integration questions, contact our experts below.
