The Big Picture of the MA Rule
The 2026 Medicare Advantage final rule bolsters some aspects of provider appeals processes in inpatient settings but creates uncertainty on several policies relating to how care is covered in MA plans.
The MA rule is the first major CMS rule released since Mehmet Oz, MD, MBA, was confirmed as the new administrator for the U.S. Centers for Medicare & Medicaid Services on April 3.
In recent years, Medicare Advantage has become the predominant plan option for Medicare-aged individuals, and health care providers and patients have frequently experienced challenges with these plans, particularly around the denial and nonpayment of medically necessary care that would otherwise be paid under traditional Medicare.
Oz and other administration leaders have championed MA plans, and the health care community eagerly awaited the release of this rule to see if it would include the practical restrictions proposed by the administration’s predecessors to protect beneficiaries and providers alike. Stakeholders were concerned that a retooled CMS might roll back these commonsense protections, allowing plans to lean heavily on regulatory loopholes to maximize payment while restricting the basic benefits required to be provided under MA plans.
Policies relating to utilization management, internal coverage criteria, and public data transparency on MA prior authorization were either not finalized or slated to be addressed in unspecified future rulemaking.
By placing these policies on an indefinite hold, it remains unseen whether the administration plans to take up the issues before next year’s annual Medicare Advantage rulemaking, if at all. The MA policy landscape effectively leaves providers and patients seeking protection or recourse against financially motivated MA policies with the same ineffectual rules, which had been beefed up in the proposals.
In-Depth Review of the MA Rule
- CMS Fact Sheet
- Implementation Date: June 3, 2025
Clarity in Appeals Process
In clarifying the term “organizational determinations,” CMS is making it harder for MA plans to deny patients and providers in inpatient settings of their appeal rights, including post-payment reviews.
Confusion on Internal Coverage Criteria
The final rule does not include a significant clarification from the proposed rule that would have better defined the meaning of “internal coverage criteria,” an area of significant relevance to both general coverage policies and application to MA prior authorization programs. CMS elected to defer implementation of its proposed definition of this term despite receiving more than 33,000 comments on this and other issues discussed in the rule. The clarification would have served to strengthen CMS’ action in 2024 to restrict MA plans from limiting services that would otherwise be covered by traditional Medicare.
Transparency and Prior Authorization
Given the current lack of transparency in MA prior authorization data, there is wide belief that MA plans overuse prior authorization. The proposed rule included requirements that would have expanded an annual health equity analysis introduced in last year’s final rule, which required each MA plan to create a health equity committee and publish an annual health equity analysis starting July 1, 2025.
As proposed, that analysis would have disaggregated data by individual services, including for each service the percentage of prior authorization requests that are approved, denied, or approved after an appeal; how many requests experience delays or extensions; and the average time it takes to get a determination. CMS required that the analysis determine how prior authorization impacted MA enrollees with certain social risk factors, such as disability, as compared with those who do not have risk factors.
Per the final rule, that policy is still under review. APTA strongly supported the policy in the proposed rule, which would have provided important data on how MA plans are using prior authorization to restrict therapy services. , APTA’s advocacy against UHC’s prior authorization would have been strengthened had the policy clarifications been finalized.
It is unclear whether the expansions to the 2025 health equity analysis are under consideration still, or whether CMS has already determined the proposals will not be finalized at all. It is also possible that CMS may be considering repeal of the existing 2025 requirement to publish a more general form of the health equity analysis. APTA advocated for these analyses in its comment letter to CMS, arguing that the reports would reveal any unfair delays or barriers to care for people with disabilities – many of whom receive physical therapist services.
To learn more, register for the “APTA Regulatory, Legislative, and Payment Updates, June 2025” webinar on June 5 at 2:30 p.m. ET.