Medicare Advantage Improvement Act of 2026

This bill makes several changes to the Medicare Advantage (MA) program under Medicare Part C, effective mostly from 2028. It sets faster deadlines for MA plans to respond to certain authorization requests, creates a compliance scoring system with payment penalties for non-compliant plans, restricts retroactive denials and clawbacks, requires MA plans to use the same medical necessity criteria as original Medicare, mandates automated payment for certain claims, and updates network adequacy standards for post-acute care providers.

Sec. 2, Improving access to timely care: Starting January 1, 2028, MA plans must respond to standard prior authorization and concurrent coverage requests within 72 hours, and to expedited requests within 24 hours. Extensions of up to 7 days are allowed only in specific circumstances. The Secretary may change these deadlines through rulemaking after 2030. Plans must also report prior authorization data at the plan level and by provider and service category.

Sec. 3, Ensuring appropriate oversight: The Secretary must create a compliance scoring program for MA organizations starting with plan year 2028. Plans are scored on compliance with categories like timely decisions, coverage criteria, prompt payment, and marketing rules. Based on the total score, plans are placed into compliance tiers that trigger payment reductions of 1.0%, 1.5%, or 2.0%.

Sec. 4, Guardrails on retrospective clawbacks: For contract years starting on or after January 1, 2028, MA plans must pay 100% of clean claims for items or services that were pre-authorized. Once an authorization is given during a hospital stay, the plan cannot later deny coverage for lack of medical necessity or reduce the payment code, except for good cause or fraud. Third-party entities are restricted from conducting medical necessity reviews on authorized services.

Sec. 5, Coverage and medical necessity criteria: Starting January 1, 2028, MA plans must apply the same two-midnight benchmark and presumption rules for inpatient hospital admissions as original Medicare. MA plans cannot use medical necessity criteria that are more restrictive than the "reasonable and necessary" standard under original Medicare. For inpatient rehab and long-term care hospitals, MA plans must follow the same coverage criteria as fee-for-service Medicare. Medical necessity decisions must be made by a physician or appropriate health professional.

Sec. 6, Eliminating inefficiencies in administrative processing: Starting with plan year 2028, prompt payment requirements apply to both in-network and out-of-network claims. MA plans must have automated payment processes for claims that were pre-authorized or on a specified list, with no manual review except for suspected fraud.

Sec. 7, Modification to network adequacy standards: For plan years beginning on or after January 1, 2028, MA plans must provide adequate access to long-term care hospitals and inpatient rehabilitation facilities, as determined by the Secretary's network adequacy standards.