MA historic enrollment decline, plan cuts could hit hospitals

A rare reduction in Medicare Advantage (MA) enrollment projected for 2026, as well as broad cuts in plan availability, could have negative consequences for hospitals and health systems.

MA plans are projecting a 900,000 drop in MA enrollments in 2026, to 34 million, according to CMS. MA enrollment would drop from a majority of Medicare enrollments to about 48%. In contrast, CMS said it projects flat MA enrollment.

The number of plans health insurers recently announced for 2026 also would decrease in most categories, according to tracking by ATI Advisory. Those reductions include:

• 9% decrease in combined MA and Part D plans
• 13% decrease in MA-only plans
• 23% decrease in stand-alone Part D plans

Some smaller categories of special needs plans (SNPs) would increase, such as:

• 42% increase in C-SNPs
• 15% increase in D-SNPs

Joyjit Saha Choudhury, a managing director for Kaufman Hall, said the increased financial pressures on MA plans will lead them to push more administrative requirements that can hit providers’ bottom lines.

Source:  ATI Advisory analysis

Only 14% of providers using AI on claims denials: survey

Despite two-thirds of healthcare finance professionals seeing the promise of AI to improve the claims processes, only 14% have unleashed it on claims denials, according to a recent survey.

The disconnect between views on the ability versus uses of AI in the revenue cycle process came from the 2025 Experian Health State of Claims Report.

Respondents’ concerns with AI use centered around accuracy, HIPAA compliance and the complexity of training teams.

Among the 14% who said their organization is currently using AI:

• 10% developed it in house
• 40% use a vendor product
• 49% use a combination of in-house and vendor AI

Source: "State of Claims 2025: The denial problem (and is AI the answer?)," Experian Health, Sept. 23, 2025. Data from 2023 was not available.

Work remains for hospitals getting ready for the TEAM bundled payments model

For the quarter of U.S. hospitals that will participate in the mandatory Transforming Episode Accountability Model (TEAM) starting Jan. 1, 2026, the preparation curve has been steep.

The Institute for Accountable Care’s analyses recently suggested 63% of hospitals would lose money in TEAM if the model were to begin imminently.

In early August, none of the more than 90 client hospitals of the solutions company Rainfall Health was yet ready for the launch of TEAMS, said Eddie Qureshi, founder and CEO.

Some keys to early success in TEAM, according to industry advisors, include:

• Establishing data streams that help hospitals holistically gauge costs and quality for the five procedures
• Ensuring close hospital-surgeon collaboration
• Giving clinicians monthly data on their performance

NUMBER TO KNOW

Approximate amount available as payments from the class-action lawsuit against Blue Cross Blue Shield, with 92% ($1.7 billion) for hospitals and the remainder for individual providers and medical groups. Learn more.

Crucial Dates

LEGISLATIVE

Oct. 9-10: MedPAC public meeting

Oct. 30: Medicaid and CHIP Payment and Access Commission public meeting

REGULATORY

Nov. 1: Comments due for OSHA proposed rule to remove certain COVID-19 safety requirements for healthcare workers in 2025