February 18, 2026
Updates on Federal Funding for Rural Communities through the Rural Health Transformation Program
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Connecting the Dots: Updates on Federal Funding for Rural Communities through the Rural Health Transformation Program (RHTP)
The Long View
On December 29, 2025, The Centers for Medicare & Medicaid Services (CMS) announced the highly anticipated funding awards to states for the Rural Health Transformation Program (RHTP)—a five-year, $50 billion federal initiative designed to stabilize and transform rural health systems across the country. This new federal investment marks a pivotal moment for states and their partners to address long-standing challenges in rural healthcare while laying the foundation for broader transformation. It provides an opportunity to reimagine care delivery, strengthen infrastructure, and build sustainable models that address entrenched gaps in rural health.
Directing Resources to Rural Communities
RHTP is designed with a focus on rural communities, where residents face persistent challenges such as provider shortages, hospital closures, and limited access to care. RHTP investments will support infrastructure development, IT system implementations and trainings, workforce recruitment and retention, and innovative care models tailored to rural community needs. The long-term goal is to create lasting capacity and resilience in rural health systems and promote better health outcomes for residents.
But the vision doesn’t stop there.
Catalyzing Statewide Transformation
While rural communities are the primary beneficiaries, we believe the impact of the RHTP will extend beyond rural borders. The program’s design encourages states to develop initiatives that can serve as pilots and start-ups, creating scalable solutions that can be adopted statewide. Workforce development programs, for example, may begin by focusing on rural providers and community health workers (CHWs) and training these individuals but, over time, strengthen the healthcare workforce across entire states and regions.
Much of the federal funding will enable states and their partners to invest in technology modernization, telehealth expansion, and integrated care models. These improvements assuredly will enhance access and quality for rural residents. And these same technologies can be deployed to enhance efficiency and coordination across entire health systems, laying the groundwork for broader system transformation and health improvement. The focus on chronic care management and innovative care arrangements has the potential to improve outcomes for all populations.
Collaborative Pathways for States and Partners
States and their partners—including health systems, community-based organizations, and technology innovators—have a valuable opportunity to collaborate on initiatives. In our review of state applications and the initial wave of state driven funding solicitations, we identified efforts to tackle long-standing system challenges, including:
- Data Sharing and Interoperability. States responded to the federal application with extensive technology and data interoperability related investments that have statewide benefits. Several states include information system initiatives that can scale care coordination statewide, including initiatives to build dedicated teams for analytics, data integration, and evaluation and tracking outcomes across initiatives. They have an opportunity to create the statewide backbone—starting with rural hubs and then expanding interfaces systemwide. States also will be advancing consumer-facing technology for preventive and chronic care, grounded in statewide health information exchange (HIE) and data strategy, again testing first in rural settings and accelerating statewide adoption of effective approaches.
- Maternal Health & Perinatal Care. Several states proposed embedding family medicine with obstetrics fellowships, expanding doula/midwife pathways, and deploying remote prenatal monitoring with support from nursing teams. These rural pilots could help standardize practice, improve outcomes, and scale across the state. Many other state proposals explicitly include initiatives to strengthen access to maternity care, linked to broader workforce and technology investments that can be adopted in urban settings.
- EMS Modernization. States also plan to develop and strengthen emergency medical services (EMS)-led preventive and complex care support in rural areas. One application, for example, formalizes such EMS-led support in rural areas, with protocols and training designed to scale broadly. Another state references mobile health and EMS integration, creating rural pilots to improve response, navigation, and handoffs that can be standardized across the emergency care system.
Looking Ahead
RHTP is more than a funding stream. It is a catalyst for innovation and collaboration, providing an important avenue to address the chronic inequities in quality, access, and outcomes that people living in our nation’s rural communities often experience. But it also could foster improvement statewide. Program evaluation and performance monitoring of the small, community-based programs and the large-scale, multi-site, multi-year initiatives will provide insights that inform strategic decision-making at the local, state and federal levels. By scaling effective rural health-focused initiatives and investing in new and feasible tools, strategies, and programs, states can create models that improve care delivery for all their residents in the future. This is a moment for states, providers, and partners to think big and design programs that deliver lasting impact.
Health Management Associates (HMA) offers support to state agencies, health systems, and community partners shaping rural-first pilots that are designed for scalability—from maternal and perinatal care networks, EMS community care models, caregiver and CHW pipelines, to telehealth modernization and behavioral health integration. Our rural expertise and our unique ability to combine expertise in clinical, operational, policy, and data reforms for care improvement are well-suited to the goals of RHTP.
With the RHTP funding advancing to state partners early in 2026 and annual recalculations of state awards tied to performance, the time to design rural pilots that become statewide programs is now.
For questions about the RHTP opportunities for your organization and the solutions HMA can tailor to meet the needs of your state, contact Kathleen Nolan and Andrea Maresca.
Connecting the Dots: A new blog series for 2026
Connecting the Dots is a monthly HMA blog series that brings together insights from our experts to examine the major policy, program, and market forces shaping healthcare coverage, delivery systems, and financing in 2026. The posts look beyond individual changes, instead connect emerging developments across programs and markets to help leaders understand what’s changing, why it matters, and how their decisions shape the path ahead.
Tending the Embers: Staying Ready for Medicare Advantage RADV Audits
The Centers for Medicare & Medicaid Services (CMS) issued a memo January 27, 2026, with updates on the agency’s approach to checking whether Medicare Advantage (MA) plans are being paid correctly. These reviews are conducted through Risk Adjustment Data Validation (RADV) audits, which help CMS confirm that the diagnoses MA plans report are supported by medical records.
The January 2026 memo signals that CMS intends to honor its commitment to strengthen oversight of MA payments, including accelerating and expanding the use of RADV audits and using AI (artificial intelligence) to streamline human coding reviews. MA organizations must now prepare to respond to the RADV audit notice within the required five-month window, while balancing their other risk-adjustment programs.
In this article, we explain the rapidly evolving landscape affecting RADV audits. Wakely, an HMA company, addresses what these changes mean for MA organizations and key considerations to ensure they are prepared for the upcoming enhancements to federal program integrity initiatives.
Overview of CMS’ RADV Refresh
CMS announced a major shift in May 2025: All MA plans will undergo RADV audits—not just a small sample as before. These audits look for cases in which diagnosis information submitted by a plan does not match the documentation in the patient’s medical record. When this happens, CMS may decide the plan was overpaid and require repayment. Historically, CMS audits have identified widespread diagnosis-code documentation errors, resulting in significant revenue recoupment from MA plans.
The 2025 announcement creates a framework for additional risk for MA plans, which could shift to risk-bearing provider groups. As we explained in an earlier article, key components of that announcement include:
- All MA plans will be audited starting with Payment Year (PY) 2018.
- CMS committed to accelerating audits by adding more staff and using new technology.
- CMS planned to use “extrapolation”—meaning if errors were found in a small sample of records, the error rate could be applied to the full population, which could lead to much larger repayment amounts.
- CMS also planned to eliminate the fee-for-service (FFS) adjuster—a policy that previously helped reduce the amount a plan would have to repay. This proposal would increase financial risk for plans.
Both the use of extrapolation and the removal of the FFS adjuster were later challenged in court.
Legal Challenge
In September 2023, Humana sued CMS in federal court, arguing that the 2023 RADV final rule, which allowed extrapolation and removed the FFS adjuster, was put into place without following proper federal rulemaking procedures. On September 25, 2025, the court agreed with Humana and vacated certain parts of this final rule, meaning certain parts of the rule are no longer in effect.
CMS appealed the ruling on November 1, 2025, which has created uncertainty about how RADV audits will work in future years.
Navigating the Legal and Regulatory Changes in Early 2026
The court did not say that extrapolation or elimination of the FFS adjuster is illegal—only that CMS did not follow the required process for changing the rules. Hence, the 2023 RADV final rule cannot take effect unless CMS wins its appeal or reissues the policy using the proper steps.
In its January 2026 Health Plan Management System (HPMS) memo, CMS stated that it will comply with the order while it is in effect.
The pending litigation does not diminish CMS’s broader commitment to increased audit activity and heightened scrutiny of MA risk-adjustment practices.
Effect of the Ruling. During RADV audits, CMS selects a sample of enrollees and requests corresponding medical records from the MA plan. These records are reviewed to confirm that the documented diagnoses meet CMS requirements. If unsupported diagnoses are found, CMS may recalculate payments and recover overpayments from the health plan. This audit process maintains program integrity and ensures accurate payments.
Plans that submit incomplete records could owe significant repayments to CMS.
CMS’s January 2026 memo clarifies how the agency plans to roll out additional RADV audits starting with PY 2020. CMS also addresses the agency’s plans to:
- Reduce burden on plans and providers, for example by extending the submission window
- Balance the volume of medical record submissions needing review by using smaller sample sizes where appropriate
- Use AI to further accelerate the review process
Preparing for What’s Next
Given CMS’s stated direction and the still unsettled litigation environment, MA plans should remain vigilant and audit ready.
Key steps include:
- Prioritizing timely and complete chart submission processes
- Strengthening internal criteria to identify and prioritize charts most likely to support diagnoses
- Improving documentation and coding accuracy through provider engagement
- Conducting proactive self‑audits to identify potential vulnerabilities
- Partnering with expert RADV consultants to navigate audit strategy, documentation, and submission readiness
Connect with Us
Wakely assists plans with their RADV initiatives and development of robust RADV playbooks. For more information about Wakely’s RADV playbooks, contact Debbie Conboy.
Case Study Report: Lessons Learned from HealthySteps Technical Assistance in California
This report synthesizes insights from multiple efforts to support the financial sustainability of HealthySteps sites in California, including federally qualified health centers (FQHCs), community clinics (non-FQHCs), private practices, and other settings. Led by the HealthySteps National Office and Health Management Associates (HMA), the technical assistance (TA) elevated challenges, strategies and best practices to achieve sustainability informed by learning collaboratives, individualized TA sessions, and financial modeling exercises. This report complements additional resources that the HS National Office and HMA developed which are available via the HealthySteps (HS) Sustainability website.
Congress Advances FY 2026 HHS Appropriations Bill with Health Extenders and PBM Reforms
On February 3, 2026, Congress finalized federal funding for fiscal year (FY) 2026, with the House passing the Consolidated Appropriations Act (CAA), 2026, with a vote of 217-214, following Senate approval last week. The president signed the CAA (H.R. 7148) shortly thereafter. The law provides full-year appropriations for the Departments of Health and Human Services (HHS), Housing and Urban Development, Labor, and several other departments.
This year’s HHS funding bill is notable not only for what it includes, but also for what it omits. It restores or maintains funding for key public health and research agencies previously proposed for elimination in the president’s FY 2026 budget request, extends several healthcare programs, and contains a significant package of pharmacy benefit manager (PBM) reforms. All of this activity comes as the Administration announces new grant programs and policy efforts related to its signature priorities.
In this article, we review the major funding and policies approved in the HHS spending bill. We also address key considerations for healthcare organizations as they anticipate downstream funding and policy developments and develop advocacy initiatives for federal FY 2027 bills.
HHS Funding Levels and Direction
The bill provides $116.8 billion for HHS, an increase of $210 million over FY 2025, and rejects large-scale structural reorganizations proposed in the president’s FY 2026 budget. This provision preserves funding for the Agency for Healthcare Research and Quality (AHRQ), Centers for Disease Control and Prevention (CDC), Health Resources & Services Administration (HRSA), and the Substance Abuse and Mental Health Services Administration (SAMHSA)
Table 1. HHS Agency Funding Highlights, FY 2026
| Agency | FY 2026 Funding | (+/-) Compared with FY 2025 |
| Administration for Strategic Preparedness and Response (ASPR) | $3.7 billion | +$58 million |
| CDC | $9.2 billion | level funding |
| Centers for Medicare & Medicaid Services (CMS), administrative expenses only | $3.7 billion | level funding |
| HRSA | $8.9 billion | +$415 million |
| National Institutes of Health (NIH) | $48.7 billion | +$929 million |
| SAMHSA | $7.4 billion | +$65 million |
The bill also extends mandatory funding for community health centers, special diabetes programs, the National Health Service Corps, and Teaching Health Center Graduate Medical Education.
PBM Reforms in the Package
In one closely watched area of federal policymaking, the FY 2026 package includes a substantial set of PBM-related reforms that largely mirror the bipartisan package negotiated but not enacted in December 2024. These reforms have implications across Medicare Part D, commercial insurance, and employer-sponsored plans.
The legislation contains the following PBM reforms:
- Prohibits PBMs from deriving remuneration linked to drug prices for Medicare-covered Part D drugs
- Restricts spread pricing in Medicaid, eliminating a major driver of PBM revenue
- Requires contractual transparency, mandating that PBMs clearly define pricing terms in agreements with Part D plan sponsors
- Adds new PBM reporting obligations, including drug price reporting and rebate disclosures
- Requires 100 percent passthrough of rebates in ERISA-regulated plans for new, renewed, or extended contracts beginning 30 months after enactment
- Expands audit rights for plan sponsors
- Codifies the “any willing pharmacy” requirement for Medicare plan sponsors
These provisions position 2026 as a consequential year for PBM regulation, increasing transparency, strengthening plan leverage, and heightening HHS oversight.
Healthcare Extenders and Program Reauthorizations
The bill includes a broad set of Medicaid, Medicare, and public health program extenders, affecting providers, patients, states, and managed care plans.
Medicaid
- Postpones reductions in the Disproportionate Share Hospital (DSH) allotments until FY 2028
- Changes the DSH cap calculation to broaden which patient costs count toward Medicaid shortfall
- Requires states to develop and implement a process to allow certain out-of-state pediatric providers to deliver services without additional screening for three years
- Removes age limits on Medicaid’s Ticket to Work program, allowing adults older than age 65 to participate and requires state compliance by January 1, 2028
- Establishes new maternity care reporting requirements for rural hospitals, with dedicated federal funding for hospitals and states to comply with the reporting
Medicare
Congress extends several key programs and payment provisions, including:
- Telehealth flexibilities through December 31, 2027
- Incentive payments for participation in eligible alternative payment models through payment year 2028 (for performance year 2026) and applies an adjustment amount of 3.1 percent for 2028
- Acute Hospital Care at Home waivers through 2030
- Low-volume and Medicare-dependent hospital payment adjustments
- The 1.0 work geographic practice cost index floor used in the calculation of payments under the Medicare physician fee schedule through December 31, 2026
- Add-on payments for ambulance services
- Continuation of Part D coverage for certain antivirals and modifications to hospice payment caps
Behavioral Health Policy
The appropriations bill was finalized as the administration announced new funding and policy initiatives to support behavioral health, crisis services, workforce expansion, and youth mental health—efforts mirrored in SAMHSA’s increased appropriations.
SAMHSA’s $7.4 billion budget includes:
- $1.6 billion for State Opioid Response grants
- $1.01 billion for the Mental Health Block Grant
- $535 million for the 988 Suicide and Crisis Lifeline
Considerations for Stakeholders
Federal funding and policy developments affect state budget dynamics as many states are now releasing 2026–2027 budget proposals as well as the operational and growth plans of healthcare organizations and partners.
A few key takeaways from the FY 2026 funding bill include:
- Federal appropriations signal congressional and administration priorities and have downstream impact on upcoming rounds of grant cycles, including SAMSHA and HRSA awards.
- The approved funding and certain policy extensions provide operational stability and reduce near-term fiscal pressure, such as the further delay of Medicaid DSH cuts. The extra time will allow healthcare entities to prepare for future reductions and plan for financial sustainability.
- Agency and program funding emphasize oversight, program integrity, and compliance. In addition, fraud and program integrity priorities are woven into certain new policies and program extensions, including PBM reforms, flexibility for pediatric care across state borders, and rural maternity cost reporting requirements, among others.
Connect with Us
If you would like deeper analysis or state and stakeholder-specific effects, HMA’s policy experts are available to assist.
HMA’s Take on 2026 ACA Marketplace Open Enrollment Snapshot
On January 28, 2026, the Centers for Medicaid & Medicare Services (CMS) released its second national snapshot of 2026 Affordable Care Act (ACA) Marketplace Open Enrollment (OE) activity. While this update is not a final accounting of enrollment activity, it is likely to be the last OE federal data release for some time and offers an early look at how enrollment trends are shifting in the wake of expired enhanced premium tax credits and new eligibility standards under the 2025 budget reconciliation act (P.L. 119-21, OBBBA).
In this article, Health Management Associates (HMA) and Wakely, an HMA company, highlight findings from their analysis of the 2026 OE activity and compare this activity with 2025 data. This analysis builds on the findings in their January 2026 analysis (here) and will provide important context for the 2027 plan year.
Overall Enrollment Trends
CMS reports that 2026 plan selections decreased by 5 percent from 2025, with enrollment declining across both new and returning consumers. New sign-ups dropped by 14 percent and renewals fell by 3 percent (Table 1). State-based Marketplace (SBM) enrollment dipped modestly, though many SBMs were still enrolling consumers in late January.
Table 1. Comparison of 2026 and 2025 Open Enrollment
| 2026 | 2025 | Net Change | |
| Total | 22,973,219 | 24,166,491 | (1,193,272) |
| New Consumers | 3,382,189 | 3,938,907 | (556,718) |
| Returning Consumers | 19,591,030 | 20,227,584 | (636,554) |
Variation Across State-Based and Federally Facilitated Marketplaces
Enrollment patterns varied substantially across states.
SBMs:
- New Mexico saw the largest year-over-year increase (14%), attributed to state-funded subsidies designed to offset the loss of enhanced premium tax credits (ePTCs).
- Georgia experienced a 14 percent decline, the steepest drop among SBMs.
Federally Facilitated Marketplace (FFM) States:
- Overall, FFM enrollment fell 5 percent.
- Texas led FFM states with a 5 percent increase in plan selections.
- Ohio and North Carolina experienced substantial enrollment declines, 20 percent and 22 percent respectively.
What This Tells Us—and What It Doesn’t Tell Us Yet
FFM data are as of January 15, 2026, and measure plan selections after the OE period ended. Within the FFM, state-by-state enrollment activity varied significantly. Some of this variation is surprising and not readily explainable from the available data and will be a focus of future HMA and Wakely analyses.
The data include neither effectuated enrollment nor paid enrollment—data which will be key to fully understanding 2026 enrollment trends and the impact of changing federal policies, including the ePTC expiration and changing eligibility standards introduced in 2026 as the result of OBBBA.
Early SBM data suggest significantly higher cancellation and disenrollment rates than in previous years.
SBMs are sharing that they expect substantial affordability-driven voluntary and nonpayment terminations over the first half of 2026.
Monitoring paid enrollments, attrition, and grace period dynamics, including retro-terminations, will be key to understanding market dynamics and 2027 pricing.
Connect with Us
HMA and Wakley experts have considerable experience working with states, insurers, and federal policymakers with jurisdiction over the Marketplace. We work with these entities to inform, analyze, and shape federal policies and conduct impact analyses on pricing, enrollment, administration, and operations. HMA also provides strategic and project management support for the implementation of finalized policies.
Please contact Michael Cohen, Taylor Gehrke, or Zachary Sherman with questions, follow-up, or if you would like expert assistance exploring any of the issues discussed in this post.
2026 Marketplace Open Enrollment: Where the Numbers Currently Stand
On January 28, 2026, the Centers for Medicaid & Medicare Services (CMS) posted a national snapshot detailing 2026 Open Enrollment (OE) results. Although this report is neither a complete nor final picture of 2026 Marketplace enrollment activity, it is likely to be the last OE data CMS publishes for some time. A comparison of 2026 and 2025 Open Enrollment results can be found in Table 1.
Table 1. Comparison of 2026 and 2025 Open Enrollment
| 2026 | 2025 | Net Change | |
| Total | 22,973,219 | 24,166,491 | (1,193,272) |
| New Consumers | 3,382,189 | 3,938,907 | (556,718) |
| Returning Consumers | 19,591,030 | 20,227,584 | (636,554) |
A summary of our analysis on these 2026 OE results and how they compare with 2025 data can be found below. This analysis builds on the findings in Wakely’sIndividual ACA Open Enrollment Insights So Far from January 2026.
- Overall, topline plan selections are down from last year. Total enrollment decreased by 5%, with new enrollment down 14% and renewals down 3%.
- State-based marketplace (SBM) enrollment declined modestly, but the data are as of January 10, and many SBMs are continuing to enroll people through the end of January.
- New Mexico plan selections increased by 14% over last year, the largest increase of any state, driven by state-funded subsidies mirroring the expired enhanced premium tax credits (ePTCs).
- Georgia plan selections decreased by 14%, the largest SBM year-over-year decline.
- The federally facilitated marketplace (FFM) experienced an overall decrease of 5%. FFM data are as of January 15 and therefore measures plan selections after the OE period has ended. Within the FFM, state-by-state results varied significantly.
- Texas led all FFM states with a 5% increase, whereas Ohio and North Carolina experienced 20% and 22% decreases in enrollment, respectively.
- Some of this variation is surprising and not readily explainable from the available data and will be a focus of future Health Management Associates and Wakely analyses.
- The data include neither effectuated enrollment nor paid enrollment—data which will be key to fully understanding 2026 enrollment trends and the impact of changing federal policies, including the ePTC expiration and changing eligibility standards introduced in 2026 as the result of P.L. 119-21 (OBBBA).
- Initial data from SBMs suggest significantly higher rates of cancellations and disenrollments than in previous years.
- SBMs are also sharing that they expect high rates of affordability-driven voluntary and non-payment terminations throughout the first half of 2026.
- Monitoring paid enrollments, attrition, and grace period dynamics, including retro-terminations, will be key to understanding market dynamics and 2027 pricing.
HMA and Wakley experts have considerable experience working with states, insurers, and federal policymakers with jurisdiction over the Marketplace. We work with these entities to inform, analyze, and influence federal policies and conduct impact analyses on pricing, enrollment, administration, and operations. HMA also provides strategic and project management support for the implementation of finalized policies.
Please contact Taylor Gehrke at [email protected], Michael Cohen at [email protected], or Zachary Sherman at [email protected] with questions, follow-up, or if you would like expert assistance exploring any of the issues discussed in this post.
Related Resources:
- 2025 Individual Market Risk Pool Considerations Updated
- Upcoming Webinar February 4, 2026 at 12pm ET: 2027 ACA Considerations: Proposed NBPP and Other Key Changes and Trends
Medicaid Changes in the OBBBA and Implications for the Marketplace and Individual Market in 2027
In recent years, the individual market has undergone significant disruption. The expiration of enhanced premium tax credits (ePTC) at the end of 2025 and sweeping eligibility changes under the 2025 Budget Reconciliation Act (OBBBA) have reshaped—and will continue to reshape—the individual market.
The number of changes facing states and issuers in coming years are significant. As a result, it is unsurprising that discussion and analysis on the individual market impacts of the new Medicaid requirements is limited and expected to result in large numbers of Medicaid beneficiaries being disenrolled. Between community engagement requirements (i.e., work requirements), increases in eligibility checks, and loss of eligibility for certain immigrant population, the expectation is that millions of people will leave Medicaid in 2027.
This brief explores how these coming changes will reshape coverage pathways and costs, and examines implications for consumer affordability and churn, issuer pricing and risk pools, and state administrative burdens—alongside strategies for states, issuers, and policymakers to mitigate adverse effects.
CMS ACCESS Model: A New On-Ramp to Outcomes-Based, Tech-Enabled Care in Traditional Medicare
The Centers for Medicare & Medicaid Services (CMS) Innovation Center recently published applications for its new ACCESS Model (Advancing Chronic Care with Effective, Scalable Solutions), a 10-year voluntary initiative beginning July 2026. The model is designed to advance outcomes-based, technology-enabled care delivery in Original Medicare and aligns with the Innovation Center’s priorities of strengthening prevention, empowering beneficiaries, and promoting performance-based competition. ACCESS is particularly suited to organizations with mature clinical operations and data infrastructure, offering a new pathway for tech-supported services.
This article summarizes the model’s design, highlights key considerations for prospective applicants, and addresses common questions our Medicare and technology experts fielded during a recent Health Management Associates (HMA)/Leavitt Partners webinar.
What the ACCESS Model Is Testing
ACCESS evaluates whether Outcome-Aligned Payments (OAPs)—recurring payments contingent on measurable clinical improvement—can reduce spending while maintaining or improving quality for beneficiaries with chronic conditions. The model tests whether incentivizing technology supported care can produce reliable clinical outcomes while complementing traditional care delivery.
Who may participate? Organizations must be Medicare Part B–enrolled providers or suppliers (excluding DMEPOS [Durable Medical Equipment, Prosthetics, Orthotics, and Supplies] and labs). Participants may enroll beneficiaries directly, operate across multiple clinical tracks, and manage all qualifying conditions within each selected track. Beneficiary participation is voluntary, and individuals may switch ACCESS participants every 90 days.
Clinical tracks. At launch, the four clinical tracks reflect high-prevalence chronic conditions with established care pathways and strong evidence for technology-supported interventions:
- Early Cardio-Kidney-Metabolic (eCKM)
- Cardio-Kidney-Metabolic (CKM)
- Musculoskeletal (MSK)
- Behavioral Health (BH)
Payment. OAPs vary by track and performance period. CMS pays a portion prospectively each quarter and withholds 50 percent pending reconciliation based on:
- Clinical outcomes attainment: The percentage of aligned beneficiaries who complete the 12‑month performance period and achieve track‑specific clinical targets relative to their baseline.
- Substitute‑spend test: Ensures beneficiaries do not receive duplicative fee-for-service (FFS) services for conditions managed under ACCESS.
Technology and data exchange. ACCESS takes a tech-forward approach. Key expectations include use of Fast Healthcare Interoperability Resources (FHIR®) based Application Programming Interfaces (APIs) for eligibility, consent, claims sharing, and care coordination—part of the broader federal push to modernize the health data ecosystem. CMS also plans to publish a public directory that lists participants, tracks, cost-sharing policies, and risk-adjusted outcomes to enable consumer and clinician choice.
Regulatory coordination. To complement ACCESS and expand the pipeline of technology-supported interventions, the US Food and Drug Administration’s (FDA) TEMPO (Technology-Enabled Meaningful Patient Outcomes) pilot allows selected US-based digital health device manufacturers to participate while generating real-world evidence. Up to 40 device manufacturers may participate across clinical areas.
This coordinated CMSFDA effort is intended to reduce barriers to innovation and accelerate access to safe, effective digital tools that can support chronic disease management.
Key Considerations for Applicants
Program integrity and fraud/abuse. CMS has emphasized program integrity across Medicare and Medicaid, and ACCESS reflects that emphasis. Applicants and their parent organizations should expect rigorous screening. Participants must also operationalize controls to pass the substitute spend test and maintain auditable evidence of outcomes and beneficiary consent.
Overlap with Accountable Care Organizations (ACOs) and other models. Patients may participate in ACCESS and be aligned with an ACO simultaneously; however, “participant overlap” raises important operational and financial issues. ACCESS includes an FFS exclusion policy that prohibits participants or affiliated entities from billing Medicare FFS for any services delivered to the same beneficiaries for the duration of their ACCESS episode. As a result, traditional providers, ACO-aligned clinicians, and integrated delivery systems must assess whether they can segment patient populations or if partnering is more feasible.
Eligibility and clinical scope. ACCESS is focused on relatively stable, chronically ill beneficiaries and excludes those with more acute/severe conditions. Participants must accept responsibility for all qualifying conditions a beneficiary has within a track.
Outcomes performance. The ACCESS Model places substantial emphasis on clinical performance and care coordination. Participants are paid in full only if enough patients hit outcomes targets. Early cohorts will likely skew toward organizations with mature clinical protocols, robust engagement models, and demonstrated outcomes. Applicants should be financially prepared to tolerate withholds, beneficiary switching, and follow-on period payment reductions after year one.
Digital infrastructure and interoperability. ACCESS presumes API-driven data exchange, including consent capture, eligibility checks, claims/clinical data integration, and bidirectional information sharing with the patient’s broader care team. Applicants should ensure they have a FHIR API server and meet the requirements described in the CMS Health Tech Ecosystem pledge.
Go-to-market and referral strategy. Beneficiary alignment is voluntary and will be facilitated by CMS’s planned public directory with risk-adjusted outcomes. Access participants will benefit from strong referral relationships—especially with ACOs and primary care providers—both to enroll eligible beneficiaries and to minimize substitute services. A field strategy grounded in evidence, patient engagement, and interoperability with local providers is critical to success.
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Applications for the first ACCESS Model performance period are due April 1, 2026, with model launch in July 2026; applications submitted later would start January 1, 2027. Because ACCESS is a rolling, decade-long model, some organizations may choose to stage entry.
ACCESS is the most explicit Innovation Center opportunity to date on outcomes-based, tech-enabled chronic care in Traditional Medicare. It offers digital health and advanced care organizations a direct line to FFS beneficiaries with payment tied to results, not activities. Success will favor teams that combine clinical excellence, consumer-grade engagement, and API-level interoperability, as well as manage program integrity, ACO overlap, and beneficiary churn.
For questions or support assessing readiness, developing an application, or operationalizing the model, contact Amy Bassano, Ryan Howells, or Kate de Lisle.
CMS Releases 2027 Advance Notice with Medicare Advantage and Part D Rates
The Centers for Medicare & Medicaid Services (CMS) released the Calendar Year (CY) 2027 Advance Notice and Payment Policies for the Medicare Advantage (Part C) Part D Prescription Drug Program on January 26, 2026. The Advance Notice begins CMS’s annual rate-setting cycle and describes proposed updates to Medicare Advantage (MA) growth rates, benchmark rebasing, risk adjustment, Star Ratings, and Part D payment parameters. CMS previously released a proposed rule in November 2025 that included policy changes to the Star Ratings system and enrollment policies for MA and Part D starting in contract year 2027. (Read the Health Management Associates (HMA) summary here.)
Comments on the Advance Notice are due February 25, 2026, and CMS will publish the final CY 2027 rate announcement no later than April 6, 2026.
This article provides an early look at the proposed methodological updates and draft capitation rates. Wakely, an HMA Company, will publish a detailed analysis of the Advance Notice in early February.
Payment Impact on Medicare Advantage Organizations
CMS estimates a national per capita MA growth rate of 5.10 percent from 2026 to 2027, with fee-for-service (FFS) non-end-stage renal disease (non-ESRD) growth of 5.10 percent and FFS dialysis end-stage renal disease (ESRD) growth of 6.17 percent.
The 5.10 percent growth rate reflects projected increases in per capita FFS Medicare spending for beneficiaries who are aged/have disabilities and serves as the primary driver of 2027 benchmark updates, interacting with rebasing and risk adjustment changes to determine final capitation payments. The growth rate reflects updates to how CMS pays for skin substitutes in the 2026 Medicare Physician Fee Schedule. These updates resulted in significantly lower projected costs and materially reduced the growth rate.
These preliminary estimates inform the development of MA benchmarks and may change in the final rate announcement.
Table 1. Estimated Impact of Proposed Payment Changes on Medicare Advantage Plan Payments, CY 2027
| Year-to-Year Percentage Change | |
| Impact | CY 2027 Advance Notice |
| Effective Growth Rate | 4.97% |
| Rebasing/Re-pricing | TBD |
| Change in Star Ratings | -0.03% |
| MA Coding Pattern Adjustment | 0% |
| Risk Model Revision and Normalization | -3.32% |
| Sources of Diagnoses | -1.53% |
| Expected Average Change | 0.09% |
| Source: Centers for Medicare & Medicaid Services. 2027 Medicare Advantage and Part D Advance Notice. January 26, 2026. Available at: https://www.cms.gov/newsroom/fact-sheets/2027-medicare-advantage-part-d-advance-notice. | |
Medicare Advantage Benchmarks, Rebasing, and Risk Adjustment
The Advance Notice describes CMS’s approach and changes that will affect payment to plans, including:
- Excluding from the risk adjustment process diagnoses submitted from chart reviews with unlinked claim records. In the Fact Sheet, CMS estimates this change will reduce Part C payments by 1.53 percent.
- Rebasing county FFS rates for 2027 using 2020–2024 claims data, continuing CMS’s practice of updating benchmarks annually to reflect the most current FFS experience. The Advance Notice also reiterates the statutory framework for calculating benchmarks, including applicable and specified amounts, benchmark caps, and quality bonus payments.
- Updating the CMS Hierarchical Condition Category (CMS-HCC) and Prescription Drug Hierarchical Condition Category (RxHCC) risk adjustment models and associated normalization factors for CY 2027 and continuing to apply the statutory MA coding pattern difference adjustment to account for systematic differences in diagnosis coding between MA and FFS.
Quality Bonus Payments, Star Ratings, and Part D Updates
CMS states that contracts with 4 or more Stars receive a 5 percentage-point quality bonus, while new and low-enrollment contracts receive a 3.5percentage-point bonus. The Advance Notice also includes updates related to Part C and Part D Star Ratings measures and methodological refinements.
For Part D, CMS outlines proposed updates to the defined standard benefit parameters for CY 2027, as well as changes to Part D risk adjustment, normalization, premium stabilization, reinsurance, and risk-sharing, with additional policy context provided in the Contract Year 2027 Medicare Advantage and Part D proposed rule.
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The CY 2027 Advance Notice provides early signals on benchmark growth, rebasing, and payment methodology changes that will shape MA and Part D payments in 2027. Stakeholders should begin evaluating the potential implications for bid development, benefit design, and financial performance as CMS moves toward finalizing rates in April.
HMA supports Medicare Advantage and Part D stakeholders with payment impact modeling, scenario analysis, and strategic advisory services related to benchmark rebasing, risk adjustment, Star Ratings, and Part D payment policy to help organizations prepare for the CY 2027 rate announcement.
For details about the finalized payment and policy rules, contact our featured experts, Tim Courtney and Rachel Stewart.