Early this year, the Trump administration made a surprising proposal to basically keep payment rates for Medicare Advantage (MA) insurers flat in 2027. The administration had boosted those rates by about 5 percent for 2026, so the decision came as a bit of a shock, and even caused the stock prices for insurance giants to tumble. 

As one might have expected, the insurance companies that have reaped billions from Medicare Advantage are pulling out all the stops to pressure the administration to change course. But it’s clear that the politics around Medicare Advantage have been shifting away from the industry’s interests. 

The insurance giants have been hard at work nonetheless. The vast majority of the thousands of public comments filed on the rate change are identical to a letter from Medicare Advantage Majority, a dark money group that does not have to disclose its donors but is presumably backed by the industry. The organization has spent on Facebook ads promoting the campaign. Other industry groups are also throwing millions of dollars at advertising to help create the impression of a groundswell of public support for maintaining the status quo for insurance companies.

But the long overdue political pushback against Medicare Advantage is notable. While all of this lobbying and advertising was underway, we got a reminder of just how much Medicare Advantage is costing us. The latest report from Medicare Payment Advisory Commission (MedPAC), an independent agency that advises Congress on these issues, found that MA overpayments would be $76 billion this year – as in those are the payments in excess of what it would cost to cover the same beneficiaries in traditional Medicare. These findings come after some efforts to reduce overpayments, which were only marginally successful.

And in March, the bipartisan Joint Economic Committee released a report detailing how MA overpayments are increasing Medicare Part B premiums by $212 per enrollee last year. And to top it all off, one day after that report was released, the Justice Department announced that Aetna had agreed to pay $117 million to settle False Claims Act violations linked to years of Medicare Advantage ‘upcoding’ – a familiar tactic where insurance companies include information that makes beneficiaries appear sicker, which therefore increases the payments they receive to provide coverage. This is standard part of the Medicare Advantage playbook, and for years there have been similar settlements. 

The final decision on the MA payment rate for next year should come in early April. Over the past decade, the final rule has usually been adjusted in the industry’s favor; given the growing bipartisan criticism of Medicare Advantage, it will be notable to see what the Trump administration decides to do.