Changes coming to Medicare benefits in 2026

1. Reimbursement changes. Reimbursements for participants eligible for the alternative payment model will increase by 3.77% and 3.26% for non-participants. However, the Centers for Medicare & Medicaid Services (CMS) also announced a -2.5% “efficiency adjustment” that will particularly impact specialty providers who use non-time-based procedure and service codes. This impacts services ranging from surgery and pain management to cancer care. These changes have been met with resistance from some medical groups, including the American Medical Association (AMA). .

Changes were also made to the Quality Payment Program/Merit-Based Incentive Payment System and the Medicare Shared Savings Program. Eligibility is now more clearly identified for beneficiaries who have at least one eligible primary care service from an affordable care organization provider. This results in less ambiguity regarding the allocation and allocation of beneficiaries. This greater overlap should improve the validity of quality performance scores and streamline data collection and processing. This change is also expected to improve alignment between financial and clinical performance since quality measures would drive improvements in the same group of patients whose outcomes determine shared savings.

CMS will also now recognize and encourage behavioral health and psychiatric services in a primary care setting, an action long sought by primary care clinicians, who want to see behavioral and psychiatric health considered an essential part of the overall primary care plan.

2. Pilot tests with prior authorization. Medicare prior authorization will be tested in six states: Arizona, New Jersey, Ohio, Oklahoma, Texas and Washington. Providers in these states will need to receive prior authorization for 17 services, including skin and tissue substitutes, spinal cord implants and knee arthroscopy. It is important for providers and their staff to be aware of the types of procedures involved and how this may impact their budget, workflow and treatment timeline.

The prior authorization pilot requirements also include an element to test the effectiveness of AI in the authorization process. If these tests go well and expenses for services are reduced without impacting patients’ ability to access care, I expect these changes to be more widely adopted in the future.

Although these changes will only affect six states by 2026, Medicare Advantage is expected to mimic prior authorization requirements across the country. Therefore, providers located outside of the original six states should also be aware of the impact that prior authorization could have on their business.

3. AI integration. Providers should push CMS for clarity and understand what criteria are used to train the AI ​​in the authorization process and how the appeals process will work.

Testing AI as part of the pre-authorization process has been met with skepticism in the past. A recent AMA study found that more than 60% of physicians said payers’ reliance on AI increased denial rates, and 93% said prior authorization delayed care. Even minor delays in care can have serious consequences for seniors on Medicare.

That said, AI can be useful and should be adopted by providers where it makes the most sense. For example, many electronic health records offer online training modules that provide a guide to prior authorization forms. AI documentation tools are also available, taking key notes from an office visit and highlighting relevant information that may be needed to obtain pre-authorization. These options could save time and money, reduce denials, and ultimately help reduce provider burnout by reducing administrative tasks.