US finalizes 2.48% Medicare Advantage payment hike, above near-flat January proposal

April 6 (Reuters) – The United States has agreed to an average 2.48 percent increase in payments next year to private insurers for Medicare Advantage plans they administer for older adults, compared with a nearly flat offer in January, the government website said on Monday.

The new rate is expected to result in a net average increase of more than $13 billion in additional Medicare Advantage payments to plans in 2027, the Centers for Medicare and Medicaid Services said.

The final rate comes as a relief for insurers including UnitedHealth, Humana and CVS, which lost billions of dollars in market value after the Trump administration in January proposed a much smaller-than-expected 0.09% rate increase for 2027 Medicare Advantage plans.

UnitedHealth and ​CVS have larger business lines that could help buffer Medicare Advantage variability, while Humana remains more focused on plans for older adults.

Shares of UnitedHealth, CVS and Humana rose between 8% and 14% in extended trading.

(Reporting by Sriparna Roy and Christy Santhosh in Bengaluru; ​Editing by Sriraj Kalluvila)