Summary of HR 3467: Medicare Advantage Program Reform

Bill Number: HR 3467

Title: To amend title XVIII to reform the Medicare Advantage program

Introduced: May 15, 2025

Status: Sponsor introductory remarks on measure (CR H2408-2410)

Primary Sponsor: David Schweikert

Purpose and Intent

HR 3467 aims to reform the Medicare Advantage (MA) program, which provides an alternative to traditional Medicare for eligible beneficiaries. The bill introduces significant changes to how Medicare Advantage plans operate, with a focus on payment structures, enrollment processes, and risk adjustment methodologies. The overarching goal is to enhance the efficiency and effectiveness of the Medicare Advantage program, ensuring better service delivery to beneficiaries.

Key Provisions

The bill includes several critical amendments to the Social Security Act, particularly focusing on the following areas:

1. Payment Structure

• Capitated Payments: Starting January 1, 2028, MA plans must pay for benefits on a capitated basis, meaning they will receive a fixed amount per enrollee rather than paying for each service provided.
• Exceptions: This requirement does not apply to:
  • MA plans available in the previous year, limited to individuals who were enrolled in those plans.
  • Specialized MA plans for individuals with special needs.

2. Risk Adjustment Changes

• Health Status Risk Adjustment: Beginning January 1, 2028, risk adjustments will be based solely on diagnoses from face-to-face or telehealth visits, excluding those from chart reviews or standalone health risk assessments. Diagnoses will be considered from a two-year period prior to the adjustment year.
• Benchmark Adjustments: The bill modifies the blended benchmark amount for MA plans, specifying that starting in 2028, it will be 75% of the monthly benchmark.

3. Stop-Loss Payments

• The Secretary of Health and Human Services will have the authority to establish stop-loss payments for MA plans that incur significantly higher expenditures than expected, ensuring budget neutrality.

4. Automatic Enrollment

• Starting January 1, 2028, individuals entitled to benefits under Medicare Part A and enrolled in Part B will be automatically enrolled in the MA plan with the lowest premium. Individuals will have the option to decline this enrollment.
• Once enrolled in an MA plan, individuals will be restricted from switching plans or reverting to traditional Medicare for three years, unless they experience a hardship event.

Impact

The reforms proposed in HR 3467 are designed to streamline the Medicare Advantage program, potentially affecting millions of beneficiaries who rely on these plans for their healthcare needs. The automatic enrollment feature aims to simplify the process for beneficiaries, while the changes to payment structures and risk adjustments are intended to promote more efficient care delivery.

Procedural Timeline

• Introduced: May 15, 2025
• Referred to Committees: The bill has been referred to the Committee on Ways and Means and the Committee on Energy and Commerce for further consideration.
• Sponsor Remarks: Initial remarks by the sponsor were made on June 3, 2025.

This summary provides an overview of HR 3467, highlighting its primary objectives, key provisions, and potential effects on the Medicare Advantage program and its beneficiaries.