The Medicare Payment Advisory Commission (MedPAC) recently released its June 2026 Report to Congress, which includes an assessment of Medicare Advantage (MA) enrollment and its impact on hospital and post-acute care (PAC) providers’ finances, including skilled nursing facilities (SNFs), home health agencies (HHAs), and inpatient rehabilitation facilities (IRFs). Using cost report data, MedPAC found that growth in MA enrollment was not linked to meaningful changes in all-payer profit margins across hospitals, SNFs, or HHAs. MedPAC noted that interviewed providers reported higher administrative costs with approvals of care (prior authorizations), care extensions, and appealing denials. Providers also raised concerns about payment, network adequacy, and for SNFs specifically, inability to capture bad debt.
SNF data highlights include:
- Overall, MA enrollees had an 11.2% longer average hospital (inpatient prospective payment systems) length of stay compared to fee-for-service (FFS) beneficiaries, driven primarily by patients discharged to SNF, HHA, and IRF settings.
- The average hospital length of stay was19.6% longer for MA beneficiaries discharged to SNFs compared to their FFS counterparts.
- Increases in MA penetration were associated with small declines in total SNF facility days (-0.6%), revenue (-0.6%) and costs (-0.5%), but no statistically significant change in overall all-payer SNF margins (-0.1%).
- SNFs with I-SNPs had a smaller decline in all-payer margin associated with an increase in MA market penetration compared to those without I-SNPs, but the estimates were non-significant.
- Changes in MA penetration may affect subgroups of SNFs differently; smaller SNFs had smaller negative payment associations than larger SNFs.
The analysis identifies associations rather than causal effects and is based on aggregate provider financial data, which may not capture MA-specific payment and administrative burdens. These findings do not rule out meaningful effects of increases in MA penetration on the finances of specific providers. MedPAC acknowledged the need for ongoing monitoring and assessment as MA enrollment continues to grow.
Please contact AHCA’s Population Health Policy Analyst
Rohini Achal with questions.