Centers for Medicare and Medicaid Services Administrator Mehmet Oz speaks at an event hosted by the Action for Progress Coalition at the National Press Club on February 2, 2026 in Washington, DC, USA.
Al Drago | Reuters
The Trump administration on Monday finalized a much larger 2027 payment rate increase for private Medicare plans than originally proposed, boosting health insurance company stocks.
The government plans to increase average Medicare Advantage payments by 2.48%, or more than $13 billion, in 2027, according to a release from the Centers for Medicare and Medicaid Services. The Trump administration proposed a 0.09% increase in payment rates in January, and the stocks of the insurance companies that run the plans plummeted.
shares of united health and CVS Health Shares rose more than 9% in after-hours trading on Monday. meanwhile, humana‘s stock price rose about 12%.
“Medicare Advantage and Part D should work for the people who rely on them,” CMS Administrator Dr. Mehmet Oz said in the release. “These updates make coverage more affordable and ensure patients get real value from their plans.”
Closely monitored government payment rates determine how much insurance companies can charge for monthly premiums and plan benefits, and ultimately their profits.
Medicare Advantage is a privately operated health insurance plan contracted by Medicare. According to health policy research firm KFF, more than half of Medicare beneficiaries enroll in these plans, drawn by the low monthly premiums and additional benefits not covered by traditional Medicare.
