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Copyright 2026, American Health Law Association, Washington,
DC. Reprint permission granted.

As of 2025, 54% of all Medicare beneficiaries were enrolled in
Medicare Advantage (MA).54 The average Medicare
beneficiary had a choice of over 42 options in which to enroll in
2025, and the total number of plans was over 3,700 across the
United States (albeit a 6% decrease from 2024).55

Like other sectors of health care, however, the future of MA and
Medicare Advantage Organizations (MAOs) may be uncertain. Each of
the three main MA stakeholders—MAOs (the plans and payers),
enrollees (the Medicare beneficiaries enrolled in MA plans), and
the providers and suppliers (and vendors) who provide items and
services to MA beneficiaries—are facing headwinds that may
result insignificant changes to the program’s operations.
Additional headwinds come from the political uncertainty about
health care policy in general and reorganizations at CMS.

Below is a summary of key challenges facing each category of MA
stakeholders for the coming year.

MAOs. Several regulations and policies have been under
review by the Trump administration, including those relating to
heath equity and social determinants of health, and several items
in CMS’ MA Proposed Rule did not appear in the Final Rule,
potentially requiring redirection of MAO emphasis and efforts but
also perhaps cost savings. Proposed changes to agent and broker
oversight were not finalized.56 MAOs remain subject to
Risk Adjustment Data Validation (RADV) audits, but a decision
issued in September 2025 ruled in favor of an MAO and vacated the
RADV rule that allowed extrapolation of overpayment results. The
government has appealed the decision to the Fifth Circuit.

Supplemental Benefits Vendors. MA plans are required to
provide the same “basic benefits” as are covered under
traditional Medicare and may provide an additional array of
“supplemental benefits” that make a particular plan
appealing to categories of beneficiaries. While supplemental
benefits were originally limited to “health-related
benefits,” most commonly dental, vision, and hearing services,
in2019 CMS expanded the definition to include home health aides,
care giver support, adult daycare services, and therapeutic
massage. In addition, Special Supplemental Benefits for Chronically
Ill allow MAOs to offer additional benefits that have a reasonable
expectation of improving or maintaining an enrollee’s health or
overall function. At least two of the largest MA providers
reportedly have announced they will pare back supplemental benefits
in 2026, resulting in revenue challenges for the vendors of
supplemental services.57

Providers. Clinical providers of services to MAOs have
long been frustrated by their relationships with MA plans, and as
reported, several prominent providers stopped participating in
specific payer networks or accepting their plans as
covered.58 Reasons for strained relationships include
poor reimbursement, difficult prior authorization practices, and
slow payment schedules. Moreover, providers may be liable for
claims submitted both by and to the MAO. For example, providers may
be named as defendants in civil False Claims Act cases if they fail
to comply with MAO coverage and payment rules specific to that MAO
(all 3,700 of them), for which they received payment from the MAO
(who received payment from Medicare).59 DOJ identified
at least one medical group and related parties as defendants in a
case alleging falsification of diagnosis codes to increase payments
to an MAO.60

Enrollees. As noted above, the total number of plan
options for enrollees has decreased, albeit still seemingly
adequate. Although the CMS Calendar Year 2024 Final Rule clarified
several important provisions designed as beneficiary protections,
concerns continue to percolate, particularly with respect to the
MAOs’ approach to utilization management, which may increase
wait time for services or deny them altogether. Some MAOs are
cutting popular supplemental benefits. In other words, enrollees
may face fewer plan choices with fewer benefits. In 2025, MA
payments are 20% more per person than for similar beneficiaries in
traditional Medicare, potentially capturing the focus of CMS or
Congress for cuts in MAO payments that will lead to reduced
services provided to enrollees.

Takeaways. While the United States continues to
struggle to find its way to adequate and cost-efficient health
care, stakeholders including MAOs, beneficiaries/enrollees, and
providers and vendors may face more immediate changes in the year
to come.

Footnotes

54. Nancy Ochieng et al., Medicare Advantage in 2025:
Enrollment Update and Key Trends, Kaiser Family Found. (July 28,
2025), https://www.kff.org/medicare/medicare-advantage-enrollment-update-and-key-trends/.

55. Meredith Freed et al., Medicare Advantage 2025
Spotlight: A First Look at Plan Offerings,

Kaiser Family Found. (Nov. 15, 2024), https://www.kff.org/medicare/medicare-advantage-2025-spotlight-a-first-look-at-plan-offerings/#:~:text=Number%20of%20Plans%20Available%20to%20Beneficiaries.,only%20available%20to%20select%20populations.

56. CMS, Agent Broker Compensation, https://www.cms.gov/medicare/health-drug-plans/managed-care-marketing/medicare-marketing-guidelines/agent-broker-compensation.

57. Nona Tepper, Medicare Advantage plans edge away from
supplemental benefits, Modern Healthcare (Sept., 25, 2025), https://www.modernhealthcare.com/insurance/mh-medicare-advantage-supplemental-benefits-2026/?utm_content=article1-readmore&utm_source=modern-healthcare-am&utm_medium=email&utm_campaign=20250925.

58. Jakob Emerson, Hospitals are dropping Medicare
Advantage plans left and right, Becker’s Hosp. Rev. (Sept.27,
2023), https://www.beckershospitalreview.com/finance/hospitals-are-dropping-medicare-advantage-left-and-right.html
(Nov. 13, 2023).

59. DOJ, Press Release, Lincare Holdings Agrees to Pay
$29 Million to Resolve Claims of Overbilling Medicare for Oxygen
Equipment in Largest-Ever Health Care Fraud Settlement in Eastern
Washington (Aug. 28, 2023), https://www.justice.gov/usao-edwa/pr/lincare-holdings-agrees-pay-29-million-resolve-claims-overbilling-medicare-oxygen.

60. DOJ, Press Release, Medicare Advantage Provider Seoul
Medical Group and Related Parties to Pay Over$62M to Settle False
Claims Act Suit (Mar. 26, 2025),
https://www.justice.gov/opa/pr/medicare-advantage-provider-seoul-medical-group-and-related-parties-pay-over-62m-settle.

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