Final 2026 rule for MA, Part D leaves out proposed GLP-1 drug coverage

The Trump administration’s final rule setting policy and technical changes for Medicare Advantage (MA) in 2026 did not carry forward a proposal regarding GLP-1 drug coverage, but key provider-focused provisions were retained.

The rule, which is scheduled for formal publication April 15 and also sets 2026 Medicare Part D policies, excludes a Biden administration proposal to cover GLP-1 drugs for obesity in both Part D and Medicaid.

CMS did not explain the rationale for declining to finalize the proposal, but HHS Secretary Robert F. Kennedy Jr. has noted his concerns about widespread use of GLP-1s.

In his Jan. 30 confirmation hearing before the Senate Health, Labor, Education and Pensions (HELP) Committee, Kennedy said GLP-1s are “miracle drugs” but should be used cautiously.

Cost-related considerations also should factor into decisions on coverage, he indicated, saying that unrestrained access to the drugs conceivably would cost “over a trillion dollars per year. It would double the insurance costs for employers in the country, and it would be a tsunami.”

The Biden administration acknowledged costs were a potential concern, estimating that 10-year expenditures would total $24.8 billion in Medicare and $11 billion in Medicaid, plus $3.8 billion in state Medicaid spending. The hope was that net savings would accrue from avoiding downstream obesity-related complications.

Coverage would apply to 3.4 million users of GLP-1s in Medicare and 4 million in Medicaid, according to the proposal. Consumers would save up to 95% on out-of-pocket costs, with no anticipated rise in premiums.

Medicare maintains coverage of the drugs for beneficiaries who have diabetes mellitus or who are overweight or obese and also have cardiovascular disease. Some state Medicaid programs also provide coverage.

Tamping down utilization management

Providers stand to benefit from changes related to prior authorization, concurrent review and claims review, per finalized provisions in the rule.

MA health plans no longer will be able to reopen an approved inpatient admission decision, except in cases of obvious error or provider fraud.

The provision appears to be welcome news for providers. For example, Premier Inc. issued a statement from Soumi Saha, senior vice president for government affairs, saying the company is gratified to see CMS “crack down on plans’ ability to retroactively deny approved hospital stays.”

MA appeals rights are being strengthened through provisions clarifying that coverage determinations are subject to notification requirements and subsequent appeal if they take place during concurrent review of inpatient admissions. The provision is intended to ensure that appeals rules apply to adverse determinations made post-authorization.

The final rule also codifies existing guidance that obligates plans to present both providers and enrollees with notice of a coverage decision after providers submit the request for an enrollee.

Another protection in the rule establishes that out-of-pocket liability for a service cannot be determined until the contracted provider’s claim has been decided. The idea is to preserve the enrollee’s appeal rights during treatment. Once the claim has been adjudicated and the enrollee has no further liability, the payment determination is not eligible to be appealed.

CMS also reiterated a clarification issued in 2023 about the two-midnight presumption for inpatient admissions, a guideline that MA plans don’t need to follow during claims review.

“MA organizations are not required to use the two-midnight presumption to decide which claims to review but may instead decide which claims are subject to review in accordance with procedures for making determinations as provided by section 1852(g)(1)(A) of the [Social Security] Act,” CMS wrote.

Other provisions of note

Regulations applying to dual-eligible special-needs plans require them to offer integrated member ID cards and conduct a single integrated health risk assessment for Medicare and Medicaid. Those provisions take effect in 2027.

The rule finalizes a restriction on MA special supplemental benefits for the chronically ill if the benefits are deemed not to promote good health. Listed examples of benefits that no longer are reimbursable include nonhealthy food, alcohol, tobacco and hospital indemnity insurance.

Inflation Reduction Act (IRA) provisions also are included in the rule, formalizing a statutory requirement to eliminate Part D cost sharing for covered vaccines that are recommended by the CDC’s Advisory Committee on Immunization Practices. Updates to price caps on Part D cost sharing for covered insulin products also are in the rule.

Tweaks to the Medicare Prescription Payment Plan include an automatic election renewal process for enrollees unless they opt out. The program took effect in 2025, allowing beneficiaries to pay out-of-pocket Part D costs via monthly capped payments.

The Star Rating program for MA and Part D health plans is being updated by expanding the age range for biennial breast cancer screenings to include women ages 40 through 49 starting in 2027.

Left out

In addition to GLP-1 coverage, proposed provisions that did not make the final rule include modified requirements for MA health plans to conduct a health-equity-focused analysis of MA utilization management policies and procedures and to ensure AI use does not adversely affect health equity.

Other provisions proposed or previously implemented by the Biden administration are undergoing reevaluation, according to CMS. These include a health equity index reward associated with MA and Part D Star Ratings, requirements for MA plans to provide culturally and linguistically appropriate services, and quality-improvement initiatives and health risk assessments focused on equity and social determinants of health.

Scrutiny of those provisions may be based on executive orders issued by President Donald Trump to revoke federal programs and strategies related to diversity, equity and inclusion.

Still to come

The 2026 payment rates for MA and Part D plans will be finalized in a separate set of regulations to be published in upcoming weeks. The proposed rates, issued by the Biden administration, included a 2.23% increase in the payment benchmark for MA plans.

Update: The 2026 rate notice was published April 7. Read about some of the key aspects.