The Centers for Medicare & Medicaid Services (CMS) is taking new steps to improve Medicare Advantage (MA) access and transparency, including reforms to prior authorizations and the use of AI tools to deny coverage, as outlined in the 2026 Medicare Advantage and Part D proposed rule, officials said during a call on Tuesday.

The Contract Year (CY) 2026 MA and Part D proposed rule aims to hold MA and Part D plans more accountable, with proposed rule increasing guardrails on the use of AI in order to protect access to health services, officials said.

CMS Deputy Administrator Meena Seshamani emphasized that many Medicare Advantage enrollees face challenges in accessing necessary care, including medication and rehabilitation services. To address these issues, CMS is proposing updates to the MA and Part D programs, including changes to the Medical Loss Ratio (MLR) regulations to enhance competition and better data reporting.

“Today, we are taking an additional step further to address the inappropriate use of prior authorization. The proposals in this rule have been informed by the utilization management audit that CMS conducted throughout 2024 and will continue into 2025,” Seshamani said during the press conference. “We believe today’s proposed rule will further enhance the experience that seniors have with their MA plan [and] transparency.”

CMS will continue to look into internal data reported to CMS by MA plans, which currently indicate that, on average, MA plans overturn 80% of their decisions to deny claims when those claims are appealed to the plan. However, these data also show that less than 4% of denied claims are appealed in the first place, she noted. In other words, many more denials could potentially be overturned by the plan if they were appealed, Seshamani said.

“And what this means is that more patients could likely have access to care if their organization did not block it. Key proposals in this rule include defining the meaning of ‘internal coverage criteria’ to clarify when MA plans can apply utilization management and ensuring [that the MA plan’s] internal coverage policies are transparent and easily available to the public,” she said.

Seniors and others on Medicare often face barriers to receiving care, which range from struggles navigating available options, affording life-saving medications prescribed by a doctor, or accessing the inpatient or rehabilitation care needed for recovery, Seshamani said.

The agency is also focusing on protecting consumers from misleading advertisements, having already rejected over 1,500 non-compliant TV ads since 2023. Additionally, CMS is working to make sure that Medicare Advantage supplemental benefits, including those provided through debit cards, are properly administered, ensuring accountability for the use of over $79 billion in rebate dollars projected for 2026. These measures align with the Biden-Harris Administration’s focus on improving healthcare competition and consumer protections, she said.

“Our loved ones with Medicare deserve care that puts their interests first. HHS is proposing to improve transparency, accountability, and consumer protections in Medicare Advantage and Part D plans so that everyone receives high-quality care,” HHS Secretary Xavier Becerra said in a press release. “To achieve that, we want to remove barriers that delay care or deny people services and medications they need to be healthy. In addition, we continue to promote competition for pharmacies and other health care businesses.”

This proposed rule also aims to build on previous efforts by expanding access to anti-obesity medications for Medicare and Medicaid beneficiaries, on top of tackling prior authorization issues in Medicare Advantage.

To that end, CMS officials said that they intend to enhance transparency and informed choice by requiring Medicare Advantage plans to make provider directory information available on the Medicare Plan Finder.

As a proposed rule, it will go through notice and a comment period, and based on the comments, the rule would be finalized in the next administration.

MA scrutiny welcomed, but gaps remain

The largest advocacy group for nonprofit providers, LeadingAge, called the clarifications made in the proposed rule “progress” that advances the federal agency’s and nursing home sector’s common goal of achieving a Medicare Advantage program that benefits everyone.

“While we are continuing to review the details in this 700-plus page document, we can say with certainty that the further explanation and details provided on these areas bring us closer to the achievement of a shared goal: MA that works for all–enrollees, providers, taxpayers and plans,” said LeadingAge’s CEO and president, Katie Smith Sloan.

Fred Bentley, managing director for post-acute and long-term care and senior living practice at ATI Advisory, said the Biden adminiration continues to shine a bright light on MA plans’ use of prior authorization and other utilization management levers in an effort to protect Medicare beneficiaries’ access to high-quality care.

“Although the incoming Trump administration has the authority to scale back or eliminate regulations aimed at curbing the use of prior authorization, Trump’s officials will face intense pressure from providers, including hospitals and post-acute providers, to keep these requirements in place,” Bentley told Skilled Nursing News.

Throughout 2024, enforcement of the CY2024 MA policy rule (CMS-4205-F) has been a priority for LeadingAge, she said, with a particular emphasis on prior authorization (PA).

“The Centers for Medicare and Medicaid Services (CMS) responded to our urging with a commitment to audit plan compliance with the rule in year one, and has used information gathered from those audits to identify those aspects of the rule in need of refinement to achieve the desired intent,” she said.

And some issues still need attention, including work on MA Flex Cards, Smith Sloan said.

“More must be done on [prior authorizations] and concurrent reviews for post-acute care providers. And no reference in today’s rule is made regarding how MA Flex Cards should be treated in eligibility determination for government benefits, including Medicaid or supplemental security income (SSI),” she said. “We will continue our push for clarity to preclude the possibility that older adults who enroll in MA plans lured by Flex Cards lose their government assistance as a result.”

Meanwhile, officials from the American Health Care Association and the National Center for Assisted Living (AHCA/NCAL), the largest association in the nation representing more than 14,000 nursing homes, also applauded the federal agency’s scrutiny over the prior authorization process and Medicare Advantage plans – with some caveats.

“We appreciate CMS for taking important additional steps forward in strengthening the oversight of plan internal coverage criteria and establishing parameters for the use of AI. These actions are essential as seniors and their caregivers continue to face monumental challenges related to coverage denials,” said Nisha Hammel, vice president of reimbursement policy & population health at AHCA/NCAL. “While these proposed policies are a positive development, ensuring accountability and competition remains a critical priority, [and] we encourage CMS and the incoming Administration to ensure Medicare Advantage plans are upholding the promise made to America’s seniors.”