This episode of Vital Viewpoints on Healthcare unpacks the rapidly evolving regulatory landscape for pharmaceuticals. The discussion covers the challenges to innovation, such as the growing unpredictability in FDA policy, the challenges with reimbursement, and the increasing role of real-world evidence in bringing therapies to market. Julie Tierney, principal at Leavitt Partners (an 量子资源网 Company) shares her expert perspectives on rare disease innovation and upcoming user fee negotiations; while Ben Shand, vice president at 量子资源网, talks about why organizations must actively engage to navigate risk, identify opportunity, and ultimately improve patient access to care.
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Achieving Success with New Technology Add-on Payment (NTAP): What Life Sciences Companies Need to Know
This webinar is designed for life sciences companies seeking to navigate the New Technology Add-on Payment (NTAP) program. This session will equip drug, device, and diagnostic manufacturers with a clear understanding of eligibility requirements, the application process, and how to strategically position products for approval. Experts from 量子资源网 and Manatt Health will also break down CMS evaluation criteria and highlight key updates shaping the NTAP program in 2026 and 2027.
Learning Objectives:
- Understand NTAP eligibility requirements and the end-to-end application process
- Learn how CMS evaluates applications and what drives approval decisions
- Explore key updates and policy changes impacting NTAP in 2026 and 2027
Speakers:
- Clare Mamerow, Principal, 量子资源网
- Ross Margulies, Partner, Manatt Health
Fiscal 2027 State Budget Proposals: Provider Taxes, Medicaid Financing, and OBBBA Effects
As of March 15, 2026, most governors had released proposed budgets for state fiscal year (FY) 2027. In addition, several governors in states that enacted biennial budgets in 2025 have released supplemental proposals. These FY 2027 state budget proposals signal how governors are responding to Medicaid financing changes, provider tax phase downs, and new implementation costs created in the (P.L. 119-21, OBBBA).
Given the requirement enacted in OBBBA, this year鈥檚 state budgets are more than spending plans. They are critical policy tools governors will use to navigate changes in federal funding, new program requirements, and increasing pressures across Medicaid and broader healthcare markets.
The FY 2027 budgets indicate how governors are attempting to balance competing imperatives: maintaining healthcare coverage and access, stabilizing provider networks, financing Medicaid obligations, and aligning state healthcare and health-related programs with new federal rules. Healthcare provider taxes, revised funding priorities, and targeted funding proposals are key levers in the process of balancing budgets.
量子资源网 Information Services (量子资源网IS) has published its final iteration of the (subscriber access required), which examines proposed FY 2027 state budgets (January 22, 2026, A Look at Proposed State Fiscal Budgets). Our March 2026 issuance covers all proposed FY 2027 budgets for non-biennial budget states and some supplemental budget proposals for states that enacted biennial budgets in 2026. Following is a look at key trends in Medicaid proposals and some of the substantial budget proposals that are discussed within the report.
Provider Taxes and Medicaid Financing Under OBBBA
One notable fiscal federal policy change under OBBBA is the phase down of the Medicaid provider tax programs, a financing mechanism many states rely on to draw down federal matching funds and support provider payments. The federal law freezes existing provider tax programs, prohibits new ones, and requires Medicaid expansion states to phase down the minimum allowable tax rate from 6 to 3.5 percent by 2032.
In addition, OBBBA places new limits on state-directed payments, capping them at 100 percent of Medicare rates for expansion states and 110 percent for non-expansion states. Grandfathered payment arrangements will be phased down by 10 percent annually beginning in 2028.
FY 2027 state budget proposals highlight how these changes will have substantial and long-term fiscal impacts, even if some effects are delayed. Examples include:
- Arizona estimates it will receive $5.3 billion less in federal support between FY 2029 and 2033 as a result of policy changes.
- 颁补濒颈蹿辞谤苍颈补听projects聽that聽state聽expenditures聽for Medi-Cal聽will聽grow $2.4 billion in聽FY聽2027, largely聽because聽the Medical Provider Interim Payment聽expires聽in聽FY聽2026 and聽a decrease in聽managed care organization (MCO)聽tax revenue available聽to support the聽Medi-Cal聽program.聽Gov.聽Gavin Newsom鈥檚 proposed聽FY聽2027 budget assumes a transition period for the decreased MCO tax through December 31, 2026.聽
- Connecticut Gov. Ned Lamont鈥檚 proposed supplemental budget for the 2025鈥�27 fiscal biennium calls for reducing hospital provider taxes by $275 million. Connecticut increased supplemental payments and provider taxes during the 2025 legislative session, but the governor鈥檚 proposal would reduce the inpatient hospital provider tax rate from 6 percent to 4.1 percent.
- Illinois projects that most of the budgetary impacts will begin in FY 2028, with federal Medicaid support reduced by approximately $2.8 billion annually by FY 2031.
- New York Gov. Kathy Hochul鈥檚 budget proposal updates the managed care tax spending plan and estimates the state will collect $1.5 billion fewer receipts than anticipated in fiscal 2027.
Implementation Costs: Staffing, Systems, and Administrative Burden
Along with the decreased federal funding, implementing OBBBA carries significant administrative and operational costs, compounding pressure on state budgets.
According to an Associated Press of 25 state budget protections, states will need to spend up to $1 billion in federal and state funds on technology upgrades and additional staff to fully implement the Medicaid work and community engagement requirements. Many FY 2027 budgets reflect this reality, with new investments focused on expanding staffing capacity and modernizing eligibility and data systems. For example:
- 惭颈肠丑颈驳补苍鈥檚 proposed budget, for example, includes $186.6 million from the state general fund to fully implement OBBBA, including $80.3 million in all funds to hire additional full-time employees who can meet the increased workload.
- Missouri proposes $294.6 million and dedicated staff members to comply with OBBBA.
- Arizona proposes a $14.4 million one-time investment and dedicated OBBBA implementation staff.
Several governors also propose investments to help beneficiaries remain enrolled amid more frequent eligibility checks and new requirements. For example:
- Kentucky proposes $35.6 million in FY 2027 and $11 million in FY 2028 to modify the Medicaid information technology systems and other administrative systems to cover increased costs for the more frequent six-month eligibility redeterminations and to implement the new community engagement and work requirements.
- Rhode Island proposes $32.7 million for technology modifications to the RIBridges software to maintain compliance for various health and human services programs to align with OBBBA.
What to Watch: FY 2027 Budget Decisions and Medicaid Financing Risks
Upcoming provider tax phase downs and caps on state-directed payments constrain core funding tools just as implementation costs for staffing and systems are rising, forcing difficult decisions about coverage, provider support, and administrative capacity. Providers face growing uncertainty as tax supported supplemental payments are reduced or restructured, with potential implications for cash flow, service availability, and network participation.
Managed care plans, meanwhile, must navigate shifting rate development assumptions, changes in provider payment arrangements, and increased enrollment churn tied to eligibility and redetermination changes.
While the timing and magnitude of effects vary, these proposals underscore that provider tax and supplemental payment changes are more than abstract future concerns. They already are shaping FY 2027 budget decisions and long-term Medicaid financing strategies.
Most state legislatures are still debating their spending plans, making it critical to track which proposals are included in FY 2027 budgets, which are scaled back, and which are eliminated. These budget decisions will play a central role in determining market stability, access to care, and program sustainability in the years ahead.
量子资源网IS will publish additional reports in the coming months summarizing each state鈥檚 enacted budget. The first iteration is expected in May 2026.
Connect with Us
As the policy and funding landscapes continue to evolve, states and other stakeholders need to remain flexible. 量子资源网 brings the expertise, tools, and insights needed for stakeholders to stay on top of the rapidly changing environment. For questions or to connect with an 量子资源网 expert, contact Andrea Maresca and Kathleen Nolan.
The full report is available to 量子资源网IS subscribers. Questions can be directed to Maddie McCarthy.
Connecting the Dots: Medicaid Community Engagement Requirements and State Readiness for 2027
New federal Medicaid community engagement requirements, along with more frequent redetermination and a reduced retroactive聽eligibility timeframe, take effect January 1, 2027. These changes are reshaping state Medicaid policy agendas, budget decisions, and聽eligibility system design as states prepare to implement federally mandated聽work and聽community engagement requirements聽for the Affordable Care Act (ACA) expansion population.聽This blog addresses the forthcoming policy changes, key issues related to eligibility and information systems, and聽timely聽actions for state partners preparing to meet the new requirements.
Community engagement requirements聽often聽are聽discussed聽in broad terms: whether they encourage聽self-sufficiency聽or create barriers.聽For state Medicaid agencies, managed care plans聽(MCPs), and providers, however,聽the more聽immediate and consequential question is operational:聽Is the Medicaid program鈥攁cross eligibility systems, data flows, partner roles, and communications鈥攔eady聽to administer these requirements without losing eligible people?聽
Based on our work with states, Medicaid programs, and community partners, the answer is dependent on the approach to execution. Specifically, it hinges on how states prepare their systems and partners for compliance with community engagement requirements without placing undue burden or expectations on beneficiaries, government agencies, MCPs, and community partners.
Federal Context: Medicaid Community Engagement Requirements Beginning in 2027
Under , states that extended Medicaid to able鈥慴odied adults in the ACA Medicaid expansion population (up to 138 percent of the federal poverty level) must:
- Apply community engagement requirements to expansion adults, unless they qualify for an exemption聽
- Conduct聽eligibility redeterminations at least every聽six聽months聽for these enrollees聽
- Reduce retroactive coverage eligibility from聽90聽to聽30 days聽
- Verify聽community engagement聽or exemptions using available data sources聽
- Enforce consequences for noncompliance beginning in 2027聽
Forthcoming federal guidance and regulations will clarify key implementation details. In the interim, states are using the statutory framework to design the necessary policy changes. For example, many states will move beyond a simple 鈥渞equirement鈥� model toward support-oriented programs that make compliance achievable for enrollees, minimizes administrative churn, and leverages available data and information systems functionality to reduce compliance burden. In so doing, states need to use existing federal guidance to answer the following questions:
- Who is in scope and who is聽exempt聽and聽how聽are聽exemptions聽verified聽without creating new burdens聽on聽enrollees聽and the people and systems that support them?聽
- What counts as聽a 鈥渜ualifying activity鈥� for compliance聽with the community engagement聽requirement聽(e.g., education/training and caregiving)?聽
- Which聽data sources can聽be聽deemed聽as聽鈥渁uthoritative鈥澛爁or聽verifying聽compliance?聽
- How聽and when聽will聽beneficiaries be notified, supported, and given opportunities to聽supply聽missing information?聽
- How聽do they聽track compliance with the community engagement聽requirement聽and聽address聽its聽intended and unintended impacts?聽
- How聽do聽the聽verify eligibility聽for new聽applicants and what process聽do they聽use to聽monitor聽ongoing compliance for existing enrollees?聽
Analyis and planning for聽community聽engagement聽is underway now,聽state by state, and will determine whether the mandates聽will聽increase employment, education, and volunteerism聽and yield the expected health聽and聽economic benefits聽or drive avoidable coverage loss.聽
From Policy Requirement to Workable Medicaid Community Engagement Implementation
The touch multiple components of a Medicaid enterprise, including:
- Eligibility and enrollment systems and renewal workflows聽
- Data sources (wage databases, SNAP/TANF interfaces, workforce systems, education/training records)聽
- Managed care member services聽and,聽potentially,聽capitated聽payments聽
- All engagement with contact聽centers聽(e.g.,聽phone, chat, text messaging,聽email,聽beneficiary portal, etc.)聽
- Document processing聽
- Notices, appeals, fair hearing processes, and case management聽
- Reporting, audit trails, and quality assurance聽
In other words, the backend systems that support compliance with the community engagement requirement must be designed and built for real-world administration and meet oversight requirements. Backend system readiness is among the most important operational issues for expansion states, as it will dictate the overall timeline and success in meeting Medicaid leaders鈥� goals.
How Medicaid MCPs and Providers Will Support Enrollees
The Centers for Medicare & Medicaid Services (CMS) collaborated with to meet the compressed community engagement implementation timeline, the scale of system changes required across eligibility and verification workflows, and long-standing cost and capacity constraints. States are being asked to implement these complex new expectation largely within existing eligibility platforms, which were designed for purposes other than continuous activity tracking or cross-agency data exchange.
Although these arrangements may improve affordability and speed, states must still assess whether vendor-offered solutions align with their specific policy choices, data sources, partner roles, and operational risk tolerance.
Medicaid MCPs and provider groups, including hospitals and federally qualified health centers (FQHCs), will be on the front lines of enrollee retention. These organizations should engage with states now to ensure systems and information flows support their work. MCPs should focus on access to:
- Timely actionable information聽regarding聽which聽members are subject to the requirement聽
- Visibility into exemption status and pending聽verification聽
- Clear rules and data feeds that support proactive outreach聽
- Alignment on plan member communications聽
Primary care providers, hospitals, FQHCs, and behavioral health providers play a critical role in identifying and supporting exemptions. If the exemption processes are slow, unclear, or burdensome, patients with legitimate medical or functional limitations may lose coverage and providers may incur increased uncompensated care costs. Providers should be engaging states to solidify:
- Streamlined, clinically grounded exemption processes聽
- Clear guidance on documentation standards聽
- Fast, predictable exemption determinations聽
- Feedback loops when exemption requests are denied or incomplete聽
Community engagement requirements will require coordination with nontraditional partners, such as:
- Departments of Labor/Workforce聽Development聽
- Community colleges, adult education, and training programs聽
- SNAP/TANF agencies (and their employment and training programs)聽
- Community-based聽and聽faith-based organizations,聽organizations聽that聽offer聽volunteer and community service opportunities,聽and local workforce boards聽
- Employers, chambers, and sector-based workforce intermediaries聽
These partners can become essential to making the policy workable for enrollees, but they often have timelines, data standards, funding streams, and performance incentives that differ from Medicaid鈥檚. Partners should be in conversation with states now about investments in a cross-agency and cross-sector governance structure that answers practical questions about the definitions, systems and workflows, and beneficiary experience.
States Should Act Now
A real and preventable risk is embedded in the 2027 timeline: coverage loss among healthy, working adults who remain eligible but cannot navigate new processes. States must look across every part of their Medicaid system, decide what they need each partner to do, and ensure those partners have the information, tools, and authority to act. Plans and providers must be clear and advocate for what they need to prevent eligible individuals from losing coverage.
Handled well, this is an opportunity to modernize systems, strengthen cross-sector coordination, and may demonstrate whether community engagement can yield a net benefit to members鈥攏ot just add steps to maintaining coverage.
Connect with Us
量子资源网 Medicaid experts assist Medicaid and state policymakers with the following:
- Policy-to-operations design聽
- Cross-agency governance and partner alignment聽
- Information聽systems聽impact assessment, change planning,聽testing聽strategies聽and readiness metrics聽
- Scenario聽planning and beneficiary impact analysis聽
- Communications聽and operational playbooks聽
- Program聽integrity, reporting, and audit support聽
量子资源网 contributors to this article include Erin Dorrien, Kaitlyn Feiock, Andrea Maresca, and Juan Montanez.
量子资源网 Blog Series
The 量子资源网 (量子资源网) Connecting the Dots blog series brings our experts together to examine the major policy, program, and market forces shaping healthcare coverage, delivery systems, and financing in 2026. The posts look beyond individual changes to connect emerging developments across programs and markets to help leaders understand what鈥檚 changing, why it matters, and how their decisions shape the path ahead. This month our experts weigh in on preparations for Medicaid Work and Community Engagement Requirements.
March 18, 2026
Connecting the Dots: Medicaid Community Engagement Requirements and State Readiness for 2027
PBM Reform Accelerates: New Rules, Broader Oversight, and What鈥檚 Ahead
The first quarter of 2026 marked a turning point in federal oversight of pharmacy benefit managers (PBMs), the intermediaries that manage prescription drug benefits for most health plans across the commercial insurance market, Medicare Part D, and other programs. New legislation, agency rulemaking, and enforcement activity collectively signal a new phase of oversight that could materially reshape PBM contracting, compensation, and transparency requirements.
Most notably, the following developments stand out:
- The聽US Department of Labor (DOL)聽聽new disclosure requirements for PBMs聽that聽serve聽self-insured聽Employee Retirement Income Security Act聽(ERISA)聽plans.聽
- The聽Consolidated Appropriations Act聽of聽2026 (CAA 26),聽聽February 3,聽2026, establishes聽comprehensive PBM聽transparency and contracting聽requirements聽in the聽commercial insurance market and Medicare Part D.聽
- The聽Federal Trade Commission (FTC)聽聽a settlement聽with Express Scripts, Inc.聽(ESI),聽requiring significant聽changes to聽ESI鈥檚聽business practices.聽
Together, these actions signal a trend toward greater PBM accountability, with implications for plans, pharmacies, manufacturers,聽and聽consumers.聽This article provides a high-level overview of the major聽recent聽developments聽in the PBM reform policy landscape, along with key considerations for聽stakeholders.聽
Medicare Part D: Key Statutory Changes
Beginning in plan year 2028, CAA 26 makes significant changes for PBMs operating in Medicare Part D. Key provisions include:
- Requiring聽PBMs to聽provide聽annual reports to聽plan sponsor clients聽detailing aggregate and drug-specific costs聽
- Restricting聽PBMs compensation聽structures, prohibiting payments tied to drug prices, rebates, or price-based benchmarks聽and聽limiting PBMs to only receive聽bona fide service fees that reflect聽fair market value聽
- Stipulating聽additional聽parameters related to rebate guarantees, contract terminology, and audit rights聽
Additional provisions that will take effect in beginning with plan year 2029 include:
- A requirement that聽plan聽sponsors and PBMs聽comply with聽forthcoming聽standards for 鈥渞easonable and relevant鈥澛爌harmacy聽contracting terms and conditions聽
- Expansion of聽the聽enforcement infrastructure聽to avert聽potential violations of聽the program鈥檚聽pharmacy contracting聽requirements聽
Key considerations: The Centers for Medicare & Medicaid Services (CMS) has broad discretion in implementing these provisions, including setting pharmacy contracting standards, determining which PBM affiliates are subject to new requirements, and defining 鈥渇air market value.鈥� PBMs will face expanded reporting and compliance obligations, while plans and other stakeholders will have opportunities to shape implementation through the regulatory process.
Commercial Health Insurance Market: Key Statutory Changes
For the commercial market, CAA 26 establishes similar transparency requirements for PBMs that serve fully insured and self-insured plans, with reporting required up to four times per year. Unlike Medicare Part D, the statute does not prohibit pricelinked compensation in the commercial market, but it does require detailed disclosure of PBM fees and revenue streams. For contracts with selfinsured plans, PBMs must remit 100 percent of rebates and fees tied to drug utilization, subject to specified limitations.
Key considerations: These provisions significantly expand federal oversight in the commercial market. PBMs will need to scale compliance infrastructure, while employers and other plan sponsors may seek enhanced analytical and actuarial support to interpret disclosures and assess PBM performance.
Medicaid Left Out, For Now.
Unlike prior , CAA 26 does not include Medicaid-specific PBM reforms, such as on spread pricing (i.e., a PBM charges a payer more than the amount it pays the dispensing pharmacy for a prescription) and expanded National Average Drug Acquisition Cost () reporting.
Key considerations:聽These policies聽continue to have聽聽and聽could聽reemerge in legislation.聽States,聽PBMs,聽and managed care plans聽should continue聽monitoring聽for聽renewed federal action聽on these policies.聽
DOL鈥檚 Proposed PBM Fee Disclosure Rule
DOL鈥檚 proposed , 鈥淚mproving Transparency Into Pharmacy Benefit Manager Fee Disclosure,鈥� would require PBMs serving self-insured ERISA plans to information about rebates, manufacturer fees, pharmacy payments, and spread pricing. In late February, DOL the public comment period to April 15 to allow stakeholders to address how the proposed rule should align with the newly enacted CAA 26 provisions.
Key considerations: DOL could withdraw the proposal in favor of the statutory framework or could finalize the rule to take effect before the CAA 26 requirements begin. Either path would further increase near-term compliance for PBMs and plan sponsors, and stakeholders should monitor this space closely.
FTC Settlement with ESI
罢丑别&苍产蝉辫;贵罢颁鈥檚&苍产蝉辫; with ESI resolves insulin-focused against the PBM and imposes extensive requirements related to transparency, compensation, rebates and fees, and benefit design. The settlement also includes less common provisions, such as a commitment to reshore and increase disclosures related to ESI鈥檚 rebate group purchasing organization (GPO) functions.
Key considerations: If similar settlements are reached with other PBMs, the FTC could play an expanded role in shaping PBM market behavior, supplementing legislative and regulatory reforms with enforcement-driven standards.
State Efforts to Regulate PBMs
States continue to pursue PBM reforms, with of laws enacted in recent years addressing licensure, reporting, pharmacy reimbursement, and contracting standards. Although the Supreme Court鈥檚 2020 in Rutledge v. PCMA opened the door to certain state-level reforms, have narrowed the scope of permissible state regulation, particularly when ERISA preemption or Medicare Part D conflicts arise.
Key considerations: Stakeholders operating across multiple markets and states will continue to face a complex and evolving patchwork of requirements, underscoring the importance of ongoing policy tracking and compliance coordination.
Connect with Us
Recent federal and state actions suggest that PBM reform is entering a more operational phase defined by transparency聽and聽enforceable standards governing compensation, contracting, and market聽behavior. As implementation unfolds, stakeholders across the prescription drug supply chain will need to engage closely with regulators, assess new data flows, and adapt聽their聽business practices to a more prescriptive oversight environment.聽
For more information about the policies described鈥痠n this article and the PBM policy landscape more broadly, please contact our experts or Stephen Palmer.
Outlook 2026: What CMS鈥檚 Proposed 2027 NBPP Signals for ACA Marketplaces, States, and Consumers
The Centers for Medicare & Medicaid Services (CMS) proposed marks a notable shift in Marketplace policy, expanding lower premium plan options, relaxing certain federal standards, and moving more implementation and oversight responsibility to states and Marketplaces. It also introduces eligibility and verification policies that could significantly affect enrollment, operations, and market stability.
To unpack what this could mean for plan year 2027 and beyond, Andrea Maresca spoke with Zach Sherman, Managing Director for Coverage Policy and Program Design at 量子资源网 (量子资源网); Lina Rashid, Principal at 量子资源网; and , PhD, Principal at Wakely, an 量子资源网 company, who, alongside colleagues, published a Policy Brief on state-level and consumer impacts, as well as a Wakely on the proposed rule.
Q: When you zoom out from the technical details, what are the big takeaways from the proposed 2027 NBPP for states, consumers, and issuers?
Lina Rashid: At a high level, the proposal reallocates risk and responsibility across the system. Consumers may see more lower premium options through expanded catastrophic plan eligibility and more flexible bronze plan design, but often with more cost-sharing, higher deductibles, or greater complexity. For consumers, affordability is about more than just premiums; it鈥檚 about how much healthcare costs for individuals and their families overall and the cost of care when they need it.
States are being given options to take on more oversight and operational responsibility but without additional federal funding. And issuers are being given more flexibility, but it comes with uncertainty regarding enrollment and risk mix.
Zach Sherman: The rule鈥檚 cumulative effect matters more than any one policy. Expanded catastrophic eligibility, higher out-of-pocket exposure, relaxed network standards, and tighter verification requirements all interact. Together, they raise questions about access, affordability, and whether Marketplaces are equipped to manage administrative and enrollment disruption.
Q: The paper highlights potentially significant enrollment effects. What鈥檚 driving that dynamic?
Michael: Two things stand out. First, the proposal implements statutory changes that remove advance premium tax credit (APTC) eligibility for certain lawfully present immigrants beginning in 2027. CMS estimates more than a million people could lose eligibility, and it鈥檚 reasonable to expect most of them will exit the individual market.
Second, the proposed income verification changes could generate millions of data matching issues (DMIs) that temporarily or permanently cut off access to advance premium tax credits. While CMS projects a relatively modest disenrollment effect, our analysis suggests losses could be meaningfully higher depending on how quickly issues are resolved. We estimate that approximately 4.7 million enrollees could receive DMIs under the proposal, and upward of 80 percent of them could temporarily or permanently lose access to APTCs, putting coverage at risk.
Zach: If consumers can鈥檛 afford the full premiums while resolving a data issue, many will drop coverage. That creates churn and administrative strain that Marketplaces must manage.
Q: How do these policies affect state Marketplaces and regulators specifically?
Zach: States are being asked to do more across multiple fronts. Network adequacy oversight is shifting toward states that conduct effective rate review. States may also choose or feel pressure to take on Essential Community Provider (ECP) review authority, including for new non-network plans. Accepting that responsibility requires legal authority, staff capacity, and technical infrastructure.
At the same time, states may need to stand up the State Exchange Improper Payment Measurement (SEIPM) program, which CMS acknowledges will increase administrative burden.
The proposed State Exchange Enhanced Direct Enrollment (SBE-EDE) option is also a significant shift. Rather than operating a centralized consumer enrollment platform, Marketplaces would focus on certifying, overseeing, and monitoring multiple third-party entities. As a former director of a state-based Marketplace program, I know this is a fundamentally different operational posture that comes with oversight and compliance costs.
Q: The proposal also introduces non-network plans. What should stakeholders be watching here?
Michael: may offer lower premiums, but they change how access works. Provider participation depends on the willingness to accept the plan鈥檚 payment as payment in full. On paper a plan may meet access standards, but in practice consumers could face difficulty finding care. That places additional oversight responsibility on states to determine whether access is sufficient in practice. If aggressively priced non-network plans disproportionately attract healthier enrollees, it can create financial risk for issuers and for the broader market.
Q: What does this mean for market stability going forward?
Zach: Stability will vary by state. States that invest in oversight, consumer assistance, and operational readiness鈥攐ften a state-based Marketplace鈥攎ay be better positioned to manage these changes. Others may see sharper enrollment declines or access issues. That divergence across states is an important signal from this proposal.
Q: What should states and stakeholders be doing right now?
Zach: States should be doing scenario planning, assessing which flexibilities to adopt, where to maintain higher standards, and whether they have the capacity to take on expanded responsibilities. These decisions will shape how the rule plays out on the ground.
Michael: Issuers should be , risk adjustment exposure, and operational readiness. All stakeholders should remember that comments on the proposed rule are due March 13, 2026.
尝颈苍补:听Notably, CMS聽is not done with聽regulatory reforms.聽The聽agency solicited聽comment聽on聽medical聽loss聽ratio (MLR)聽policies聽and聽paused聽Essential Health Benefit聽benchmark updates,聽as well as issues not covered in this proposed rule, such as revisions to the Section 1332 waiver and聽Section聽1333 interstate compacts.聽States and issuers should be tracking what may come next, not just what鈥檚 in this proposal.
March 11, 2026
Outlook 2026: What CMS鈥檚 Proposed 2027 NBPP Signals for ACA Marketplaces, States, and Consumers
2027 Proposed NBPP: Analyzing State and Consumer Impacts
On February 9, 2026, the Department of Health and Human Services (HHS) released the proposed Notice of Benefit and Payment Parameters (NBPP) for 2027. The notice includes important proposed rules and parameters for the operation of the individual and small group health insurance markets in 2027 and beyond.
This paper summarizes key provisions in the proposed notice with a focus on the major changes to plan types, cost-sharing, network design and oversight, marketplace philosophy, and the shift of responsibilities from the federal government to states. It also evaluates any changes to returning policies from the Marketplace Affordability and Integrity rule from last year, which are currently being challenged in court, and codifies relevant statutory changes in the One Big Beautiful Bill Act.
The paper reviews the potential impact of these proposed policies on consumer affordability and access as well as the impact and associated level of effort on state regulators and marketplaces. Lastly, it touches on policies not included in this rule, including those highlighted as issues that may or will be addressed in future rulemaking as well as issues surprisingly not covered in this proposed rule, such as revisions to the Section 1332 waiver process as well as details on how a state could explore and pursue a 1333 interstate compact. Comments are due no later than March 13, 2026.
Strategies to Address Fraud, Waste, and Abuse in Non-Emergency Medical Transportation
Fraud, waste, and abuse (FWA) in Medicaid non-emergency transportation (NEMT) remain a persistent challenge for state Medicaid programs and health plans because of the scale and complexity of the benefit. NEMT is a critical, mandatory benefit intended to ensure eligible Medicaid beneficiaries without reliable transportation can get to necessary medical appointments. Numerous investigations and audits, however, have revealed that some transportation providers bill for trips that never occurred, inflate mileage, fabricate tolls, or even recruit patients with kickbacks to generate fraudulent claims, diverting limited program funding away from legitimate care needs.
The NEMT benefit represents a small share of Medicaid costs鈥攅stimated at around 1 percent of total Medicaid spending. With the codification of NEMT as a required benefit in 2020, market analysts forecast NEMT will grow considerably, nearly doubling in market size from 2021 to 2028.
Comprehensive, nationwide estimates specific to NEMT FWA are limited. Federal and state audits like those in , , and , however, have uncovered millions of dollars in claims that did not comply with federal and state requirements, underscoring systemic vulnerabilities in oversight and documentation. For example, a 2022 federal audit of New York Medicaid NEMT found an estimated $84 million in unallowable federal reimbursements and another ~$112 million that may not have complied with requirements over two years.[1]
Furthermore, individual criminal cases have involved schemes of $1 million to more than $2 million in falsely billed transportation services. Isolated settlements and audits indicate that fraud and abuse can be substantial locally even if we lack a clear, reliable national aggregate estimate.
A 2025 report by 量子资源网 (量子资源网) about NEMT contracting approaches found an opportunity for states and health plans that administer non-emergency transportation to leverage technology and require or incentivize new strategies to improve program integrity and quality in NEMT going forward. Some of the identified strategies to address FWA include:
- Adopting or requiring digital solutions鈥攕uch as GPS trip verification, electronic visit logs, and real-time data analytics鈥攖o detect irregular billing patterns before claims are paid, replacing outdated paper logs and manual reconciliations that were prone to error and exploitation.
- Focusing trip verification efforts on standing orders (pre-approved authorizations often for repeated treatments), given that they comprise the largest share of trips and are often vulnerable to fraud.
- Positioning and educating medical facilities to be critical partners in preventing FWA by confirming appointment attendance, either via phone or signature on the trip log.
- Automating mileage reimbursement (for enrollees who drive themselves or are driven by family members or friends) through a mobile app, which enabling riders to schedule and track their trips and submit claims quickly while allowing NEMT brokers to verify the mileage using GPS. This system would also allow brokers to better target their anti-fraud efforts, such as requiring additional documentation only for higher reimbursement amounts.
Since the publication of that report, several state Medicaid programs have issued NEMT procurements that maintain a strong emphasis on preventing FWA. For example, the 2025 Wisconsin NEMT RFP included provisions to promote greater collaboration between the Wisconsin Department of Health Services (DHS) Office of Inspector General (OIG) and NEMT broker, including 鈥渜uarterly and ad hoc meetings to discuss open complaint investigations, red flag patterns, and establish safeguards for ongoing or suspected fraud, waste, and abuse鈥� and imposed penalties for fraud incidents that go undetected by the broker.
FWA in Medicaid NEMT may represent a fraction of overall program spending, but the consequences are outsized: Every improper payment diverts resources away from beneficiaries who depend on transportation to access essential care. As states, health plans, and NEMT brokers modernize contract requirements, strengthen oversight, and embed technology-driven verification into their contracts and operations, the focus is shifting from retrospective recovery to proactive prevention, transparency, and accountability in transportation services.
Continued collaboration among Medicaid agencies, brokers, medical providers, and oversight entities will be critical for sustained progress. By pairing smarter contracting with real-time data tools and clear accountability, states and Medicaid health plans can better safeguard public dollars while ensuring that NEMT remains a reliable lifeline for the people it is designed to serve.
Learn more about how 量子资源网 Helps NEMT Stakeholders Overcome Challenges. If your organization is ready to talk about how 量子资源网 can help advance your NEMT goals, please contact one of our experts below.
Related Resources:
- State Medicaid Non-Emergency Medical Transportation Contracts: Key Provisions, Standards, and Considerations
- Blog: Medicaid non-emergency transportation benefit: trends and innovations from stakeholders
[1] US Department of Health and Human Services, Office of Inspector General. New York Claimed $196 Million, Over 72 Percent of the Audited Amount, in Federal Reimbursement for NEMT Payments to New York City Transportation Providers That Did Not Meet or May Not Have Met Medicaid Requirements. September 12, 2022. Available at: .
The Value Shift in Medicare Advantage: What 2026 Benefits Tell Us 量子资源网 the Market鈥檚 Next Chapter
The Medicare Advantage (MA) program continues to evolve as plans respond to shifting policy signals, market pressures, and beneficiary expectations. A new paper from Wakely, an 量子资源网 Company鈥斺�攑rovides a data-driven examination of how MA benefit designs are changing and what those changes signal about the future direction of the program.
This paper refreshes Wakely鈥檚 ongoing MA , updating with the latest 2026 plan enrollment data. It builds on Wakely鈥檚 established work examining benefit design, supplemental offerings, and the relationship between bids, rebates, and plan value, including .
This article highlights findings from the proprietary value-add metric that Wakely developed to provide a comprehensive assessment of MA plan value. Although it can be used as a comparative metric to evaluate relative changes year over year, it is not intended to represent pricing.
From Benefit Expansion to Optimization
Over the past decade, MA plans have steadily expanded benefit offerings, supported by strong enrollment growth and favorable rebate dynamics. The 2026 benefit landscape suggests that plans have been taking a more measured approach (see Figure 1). Wakely鈥檚 analysis finds that plans are becoming more strategic in how benefits are designed and deployed, maintaining or enhancing benefits that are best aligned with quality performance, affordability, and target populations while pulling back in other areas.
Plans appear to be optimizing benefits to better align with member needs, quality performance, and financial parameters. Examples include refining supplemental benefits, adjusting cost-sharing structures, and rethinking how benefits support care management and health outcomes.
Figure 1. Change in Plan Value-Add from 2025 to 2026
The shift reflects an MA market in which differentiation and long-term sustainability are increasingly important.
Supplemental Benefits: More Targeted, More Strategic
Supplemental benefits remain a defining feature of Medicare Advantage, but their role is evolving. Wakely鈥檚 paper highlights a move away from expanding the number of benefits toward targeted benefit offerings that are more clearly connected to member engagement and outcomes.
Plans are homing their focus on benefits that support daily living, chronic condition management, and access to care, particularly for populations with higher needs. This targeted approach suggests plans are thinking about value, operational complexity, and how benefits contribute to overall value propositions.
Between 2025 and 2026, the percentage of members with access to common supplemental benefits has, on average, stayed consistent or slightly decreased among the general enrollment population (Figure 2). The percentage of members who are enrolled in plans that offer over-the-counter (OTC) drug, transportation, and Flex Card benefits has decreased by 11 percent, 6 percent, and 4 percent, respectively. Conversely, the Dual Eligible Special Needs Plan (D-SNP) population saw an increase in member access to all supplemental benefit categories except transportation (an 8% decrease).
Figure 2. Percent of Enrollment in Common Supplemental Benefits
For stakeholders across the healthcare ecosystem, this trend underscores the importance of understanding not just what benefits are offered, but why.
Shifts in Cost Sharing and the Enrollee Experience
Wakely鈥檚 analysis also points to notable shifts in cost sharing and premium structures. There is continued attention to balancing affordability for members with the need to manage plan liability amid changing benchmarks and utilization patterns.
These decisions directly affect the member experience. Small shifts in copays, deductibles, or benefit limits can influence enrollment, retention, and satisfaction, particularly in competitive markets. As plans fine tune these levers, data-driven insights become critical to understanding how benefit changes may resonate with different member segments.
2026 Signals for Future Bid Cycles
The benefit trends identified in 鈥�The Value Shift鈥� series suggest several broader signals for the MA market:
- Value over volume: Plans are prioritizing benefits that support quality, outcomes, and sustainable growth.聽
- Greater segmentation: Benefit designs are increasingly tailored to specific populations and market dynamics.聽
- Data-informed decision-making: As margins tighten, plans are relying more heavily on analytics to guide benefit strategy.聽
- Special needs plans continue to drive growth.聽Enrollment in Chronic Condition Special Needs Plans (C-SNPs)聽is聽the fastest-growing segment聽in MA.聽
These dynamics have implications for MA organizations and for providers, policymakers, and partners seeking to understand how MA continues to shape care delivery and costs.
Value-Add Metric and Benefit Design Insights
In this paper, Wakely paired its actuarial and analytic expertise with tools that enable detailed benefit and market analysis. One of those tools, Wakely鈥檚 (WMACAT), calculates a comprehensive value-add metric that integrates five core components into a consistent framework that allows for apples-to-apples comparisons across plans, markets, and years. In addition, Wakely鈥檚 (SMART) supports broader competitive assessments by layering enrollment weighting, geographic variation, and plan positioning into the analysis.
As an 量子资源网 company, Wakely鈥檚 work is complemented by broader policy, market, and strategy expertise, helping organizations connect benefit decisions to regulatory developments, operational considerations, and long-term goals.
For health plans and healthcare organizations navigating the next phase of Medicare Advantage, these combined capabilities can respond to questions such as:
- How competitive is our benefit design today,聽and where are the risks?聽
- Which benefits are most aligned with our population and quality strategy?聽
- How might future policy or payment changes affect benefit sustainability?聽
Looking Ahead
MA benefit design remains an important signal of market direction by showing how plans are responding to policy change, market competition, and financial pressure. As plans shift from broad expansion to more targeted value strategies, the ability to measure, compare, and interpret benefit changes becomes essential as plans look ahead to the 2027 and 2028 bid cycles.
Wakely will continue to build on this work with upcoming analyses, including deeper dives into Part D design changes and the implications of the sunset of the Value-Based Insurance Design (VBID) program.
For information about this analysis and the Wakely tools, contact and .
March 4, 2026
The Value Shift in Medicare Advantage: What 2026 Benefits Tell Us 量子资源网 the Market鈥檚 Next Chapter