Medicare Advantage Payments Growing More Slowly Than Expected

As hospices prepare for the Medicare Advantage carve-in to become effective in 2021, current Medicare Advantage payments are growing at a slower rate than expected.

The US Centers for Medicare & Medicaid Services has proposed a 1.5% increase to the baseline Medicare Advantage payment rates for 2020, below the 3.4% increase that was enacted for 2019.

Though hospice care is not currently covered under Medicare Advantage, CMS has unveiled a hospice carve-in to become effective in 2021. The carve-in is intended to expand access to hospice services and enable greater coordination between hospice providers and the patient’s other clinicians.


Medicare Advantage plans are offered by private insurance companies approved by the US Centers for Medicare & Medicaid Services, and include HMO, PPO, and fee-for-service plans among other options.

“CMS is committed to modernizing Medicare and our top priority is to ensure that seniors have more choices and affordable options in receiving their Medicare benefits,” said CMS Administrator Seema Verma. “Medicare Advantage enrollment is at an all-time high as more and more seniors are choosing to enroll in private Medicare health and drug plans, and we need to maximize competition by providing plans the flexibility to meet patients’ needs.”

CMS made the rate announcement in its Part II of the 2020 Advance Notice of Methodological Changes for Medicare Advantage (MA) Capitation Rates and Part D Payment Policies. The proposed rule also contained provisions intended to address opioid use among Medicare Advantage patients.


CMS will accept comments on the proposed rule through March 1. The agency said the final rate announcement would be available by April 1.