CMS finalizes Medicare Advantage, Part D payment changes for CY 2025

The Centers for Medicare & Medicaid Services April 1 finalized proposed changes to Medicare Advantage plan capitation rates and Part C and Part D payment policies for calendar year 2025, which the agency estimates will increase MA plan revenues by an average 3.7% from 2024 to 2025. The notice implements expected changes to the Part C risk adjustment model that were finalized in the CY 2024 final rule and are being phased-in over three years, such as transitioning the model to reflect ICD-10 condition categories and using more recent data available for fee-for-service diagnoses and expenditures, in addition to providing technical updates to the methodology for CY 2025. It also finalizes technical updates to the Part C and D star ratings; includes certain adjustments to provide stability for the MA program in Puerto Rico; and implements changes to the standard Part D drug benefit required by the Inflation Reduction Act of 2022, including capping annual out-of-pocket costs for people with Medicare Part D at $2,000 in 2025. CMS also reminds stakeholders to consider submitting comments to the Medicare Advantage Data Request for Information announced in January; comments are due May 29.