Centers for Medicare and Medicaid Services Administrator Mehmet Oz speaks during an event sponsored by the Action for Progress Coalition, at the National Press Club in Washington, DC, USA, on February 2, 2026.
To Drago | Reuters
On Monday, the Trump administration finalized a 2027 payment rate increase for private Medicare plans that was much larger than initially proposed, a boost for health insurer stocks.
The government will increase average Medicare Advantage payments by 2.48%, or more than $13 billion, in 2027, according to a statement from the Centers for Medicare & Medicaid Services. In January, the Trump administration proposed a 0.09% payout rate increase, hitting shares of insurers that run those plans.
Actions of UnitedHealth and CVS Health rose more than 9% in after-hours trading on Monday. Meanwhile, humanShares rose about 12%.
“Medicare Advantage and Part D should work for the people who depend on them,” CMS Administrator Dr. Mehmet Oz said in a statement. “These updates keep coverage affordable and ensure patients get real value from their plans.”
The government's closely watched payment rate determines how much insurers can charge for the monthly premiums and plan benefits they offer and, ultimately, their profits.
Medicare Advantage is a private health insurance plan contracted by Medicare. More than half of Medicare beneficiaries are enrolled in such plans, attracted by lower monthly premiums and additional benefits not covered by traditional Medicare, according to health policy research firm KFF.
