红领巾瓜报

People who are听dually eligible听蹿or听Medicare and Medicaid听remain听a central focus听蹿or policymakers and healthcare organizations,听given听their complex care needs, disproportionate share of spending, and听the long-standing听challenge of coordinating coverage across two programs. One of the primary vehicles for advancing integration has been听Dual Eligible Special Needs Plans (D-SNPs), which听continue to play an increasingly prominent role as federal and state policymakers听encourage tighter Medicare-Medicaid alignment.

As听states听play听a more active听role in shaping enrollment rules, Medicaid contracting, and procurement strategies, the duals market is becoming more structured and more explicitly guided by state听policy decisions.听红领巾瓜报听(贬惭础鈥檚)听2026听Duals Integration Environmental Inventory,听examines听how听this shift听shapes the integration landscape听in 2026.听This听comprehensive inventory听is听based on听a听review of the 2026 market, insights from states, and other publicly available resources.

This article听examines key trends from 贬惭础鈥檚听2026听inventory听and听addresses听蹿ederal policy听changes听scheduled to take听effect听蹿or 2027,听which听contribute to听this dynamic听environment.

What to Expect in 2026

As the landscape for duals integration evolves, the central question has shifted from whether D-SNPs operate in a state to the more consequential question of how states are using Medicaid policy levers (i.e., enrollment rules, procurement, contracting, and managed care structures) to drive tighter alignment between Medicare and Medicaid.听

At the federal level, recent Medicare Advantage and Part D rulemaking is reinforcing that听movement.听The听 finalized the second phase-down of the D-SNP look-alike threshold to 60 percent for 2026 and established 2027 rules that limit enrollment in certain D-SNPs to members of an affiliated Medicaid managed care organization. The rule also limits the number of D-SNP benefit packages that can be offered alongside an affiliated Medicaid managed care organization. More recently, the 听requires听certain D-SNPs to use integrated member ID cards and integrated health risk assessments beginning in 2027.听

Together these rules signal a continued federal emphasis on听linking听D-SNP enrollment and operations听more closely to Medicaid coverage and听delivery systems, with states playing a听greater听role in听determining听how alignment is achieved.听

What the 2026 Inventory Shows

贬惭础鈥檚 2026 Duals Integration Environmental Inventory shows how these policy signals are translating into state action. More specifically:听

• Statewide exclusively aligned enrollment appears in 16 states in the 2026 inventory, up from听nine听in 2025.听
• Applicable Integrated Plans (AIPs) are present in 22 states, up from 14, and default enrollment is in place in 21 states, up from 16.听
• The inventory also captures 6,084,997 total D-SNP enrollees, including 1,975,250 in听Highly Integrated听SNPs听(HIDE)听and 743,683 in听Fully Integrated SNPs (FIDE-SNPs).听

Those changes are already visible in state markets:听

• Illinois, Massachusetts, Ohio, and Rhode Island entered听2026 with a greater FIDE-SNP presence tied to legacy Medicare-Medicaid Plan transitions.听
• Michigan听launched听MI Coordinated Health as a HIDE-SNP in selected regions in 2026, with statewide expansion planned for 2027.听
• Delaware also stands out:听Although it already had AIPs in the 2025 inventory, it adds statewide exclusively aligned enrollment in 2026 and shows both HIDE-SNPs and coordination-only D-SNPs.听

A Resource to Track State Market Direction

贬惭础鈥檚 , available听to听红领巾瓜报 Information Services听(红领巾瓜报IS)听subscribers,听includes听a state-by-state view of the Medicaid policy, contracting, and program structures shaping听duals听integration and D-SNP markets. In addition to听enrollment听trends, the inventory documents the integration model each state is pursuing, whether long-term services and supports or behavioral health听are included in managed care, and how procurement and contract decisions may inform future market activity.听

红领巾瓜报 experts work with clients to听apply听this information听and听deepen their understanding of state听integration听approaches, inform assessments of their market readiness and alignment opportunities, and develop strategies that support more effective听Medicare-Medicaid integration.听

Looking Ahead

Notably, 贬惭础鈥檚 inventory reflects a point in time understanding of where an individual state is today and what is known at this time about their next steps and plans. However, we expect changes in many states as they seek guidance from the Centers for Medicare & Medicaid Services and the D-SNP community to implement required changes and adopt new regulatory provisions that support state goals and priorities.听

The 2026 inventory suggests that听more states are using formal alignment听tools,听that听more enrollment is concentrated in integrated products, and听that听more markets are being shaped by the interaction between Medicaid structure, procurement, and D-SNP strategy.听

Connect with Us听

For organizations听seeking听to understand where the market is headed,听the听Duals Integration Inventory offers a clear view of how state policy and market structure are evolving and where tighter Medicare-Medicaid alignment is taking hold.听

Contact听Holly Michaels Fisher听and听Julie Faulhaber听to听discuss your听organization鈥檚听questions and needs听regarding听an听integration听strategy and听market听analysis. For information about the 红领巾瓜报IS subscription,听access to the Duals Environmental Inventory contact听Andrea Maresca听and听Gabby Palmieri.听

This week听红领巾瓜报 (红领巾瓜报),听draws on its database of monthly Medicaid managed care听enrollment听to听present its听latest quarterly analysis, offering a snapshot of听enrollment trends听across 37 states.听

The analysis comes at a critical听time. As states prepare for Medicaid eligibility policy changes听that take effect in 2027鈥攊ncluding听more frequent eligibility determinations and听expanded work and community engagement requirements鈥攃urrent enrollment trends provide an early signal of how policy decisions and administrative practices are already influencing coverage听levels.听

The 红领巾瓜报 Information Services (红领巾瓜报IS) analysis shows that听Medicaid managed care accounted for 85.6听percent听of total Medicaid enrollment in December 2025.听This analysis, available to听红领巾瓜报IS听subscribers, uses听data from听nearly 300听health plans in 41 states.鈥疶he report provides by-plan enrollment plus corporate ownership, program inclusion, and for-profit versus not-for-profit status, with breakout tabs for publicly traded plans.听

Key Insights from Q4听2025 Data听

The听37听states included in听this听review have released monthly Medicaid managed care enrollment data听through听public websites听or in response to a public records request听蹿rom听红领巾瓜报.听The report includes听the most recent data听obtained and illustrates the听effect of state-level choices around eligibility and administration. Key findings include:听

• As of听December听2025,听Medicaid managed care enrollment across the 37 states declined by听2.2 million members听year over year, falling to 62.5 million鈥攁听3.4 percent decrease.听
• Of the 37 states,听eight鈥擟olorado, Delaware, Mississippi, Missouri, New Jersey, North Carolina, North Dakota, and Oregon鈥攄id听not听experience year-over-year听managed care enrollment听declines,听and听instead showed听蹿lat enrollment or modest gains.听With the exception of Mississippi, these听are听all听Medicaid expansion states.听
• Arizona听and Indiana听experienced听double-digit听percentage听declines. Notably,听Indiana began requiring听enrollees听to actively respond to renewal mailers,听which aligns with听enrollment declines that began in March 2025.听
• Among the听expansion states in the analysis,听enrollment听declined听by听1.7听million (-3.3%) to听50.8听million.听The听seven non-expansion states听experienced听a听similar听decline (-3.6%),听bringing听enrollment to听11.7听million enrollees.听

Data Considerations.听The data听have听some听important limitations.听States report听enrollment figures at different points听during听the听month,听with听some data听reflecting听beginning of the month totals听and听others capturing听end of the month听enrollment.听In addition,听some听state datasets encompass all Medicaid programs offering managed care听plans,听whereas听others听reflect only a subset of the managed Medicaid population.听As a result, the听蹿indings should be听viewed as听indicative of broader trends rather than听a comprehensive听state-by-state comparison.鈥�听

Market Share and Plan Dynamics听

Using our data repository听蹿or听300 health plans across 41 states, 红领巾瓜报IS听analyzes听corporate ownership, program participation, and tax status听among Medicaid managed care plans. As of听December听2025, Centene听maintained the largest share of the national听Medicaid managed care market听at听17.8听percent,听蹿ollowed by Elevance (10.4%), United (8.5%), and Molina (6.0%)听(see听Figure听1).鈥�These figures highlight continued concentration among large national plans, even as overall enrollment declines.听

Figure 1. National Medicaid Managed Care Market Share by Number of Beneficiaries for a Sample of Publicly Traded Plans,听December听2025鈥�听

What to Watch鈥�听

Enrollment trends听observed听in听the fourth quarter听(Q4)听of听2025听and continuing into听2026听indicate听increasing state attention to eligibility policy and program integrity.听State legislative activity,听budget pressures, and federal听regulatory developments听are prompting many states to听assess and strengthen certain aspects of their programs听related to听eligibility, particularly as听they听prepare to implement redetermination and work and community engagement requirements.听

Several states are already moving toward implementation. Nebraska is scheduled to launch Medicaid work requirements on May 1,听2026,听while Montana plans to begin implementation on July 1, 2026.听With听additional听蹿ederal guidance still听emerging, most other states are working toward compliance ahead of January 2027 deadlines.听In听expansion听states,听policymakers听retain听authority to tighten administrative processes, alter optional benefits, or adjust provider payment levels鈥攁ctions that听may听materially affect enrollment.听

These听developments underscore why Medicaid managed care enrollment trends听deserve听close attention. Declines in enrollment are often an early indicator of broader system impacts, including rising uncompensated care for providers, shifts in payer mix, and increased financial pressure on听safety鈥�net听systems. For managed care organizations, even modest enrollment changes can mask more significant shifts in risk profiles, geographic concentration, or service needs.听

Connect with Us鈥�听

红领巾瓜报 is home to experts who know the Medicaid managed care landscape听and how it is evolving.听红领巾瓜报IS鈥檚听Medicaid听enrollment data, financials,听procurement听tracking, and a robust library of public documents鈥�equips stakeholders with听timely, actionable intelligence.听

For more information about the 红领巾瓜报IS subscription, contact鈥�Andrea Maresca鈥痑苍诲鈥�Alona Nenko.鈥�听

On April 10, 2026, the Centers for Medicare & Medicaid Services (CMS) released the proposed rule for the听. The proposal combines a modest net increase in hospital payments with policy signals around quality reporting and mandatory episode-based payment models鈥攎ost notably a proposed nationwide expansion of the Comprehensive Care for Joint Replacement (CJR) model.听

These听proposed updates underscore CMS鈥檚听continued emphasis on value-based purchasing, episode accountability, and alignment across quality programs. In addition, CMS resurfaces听ongoing听debates听with hospital stakeholders about the adequacy of Medicare payment updates amid rising costs and coverage disruptions.听

This article reviews several key provisions听in the听FY 2027听proposed听rule.听

Hospital Payment Updates: Headline Increase Masks Net Impact听

Under the proposed rule, CMS would increase base IPPS and LTCH PPS payment rates by 2.4 percent听in听FY 2027. However, after accounting for proposed reductions to uncompensated care payments for disproportionate share hospitals听(DSH)听and changes听in听outlier payments for extraordinarily high-cost cases, CMS estimates the effective payment increase would be closer to 1.2 percent.听

In aggregate, CMS听projects听the proposed update would translate to approximately听$1.4 billion听in听additional听payments to acute care hospitals next year. Hospital industry groups鈥攊ncluding the American Hospital Association (AHA) and the Federation of American Hospitals (FAH)鈥攈ave pushed back, arguing that the proposed update does not sufficiently reflect medical inflation, workforce pressures, or听anticipated听growth in the uninsured population.听

These concerns听reflect听a听long-standing听dynamic in annual hospital payment rules: CMS听seeking听to听balance听statutory updates and budget neutrality constraints against听the hospital听industry鈥檚 concern听that Medicare payments are听lagging听behind听underlying costs.听

Quality Reporting and Program Alignment听

The proposed rule would also make notable updates to the Hospital Inpatient Quality Reporting (IQR) Program. CMS proposes听adding听three new quality measures to be phased in during 2029 and 2030, while听modifying听eight existing measures to include Medicare Advantage patients. CMS also proposes shortening the performance period for certain measures from three years to two鈥攁听change designed to accelerate feedback and better align measures across programs.听

These changes continue CMS鈥檚听broader effort to harmonize quality measurement across Medicare payment and value-based programs, reduce reporting lag, and incorporate a more comprehensive view of patient populations.听

Updates to听Mandatory听TEAM听Model听

CMS also proposes several updates to the Transforming Episode Accountability Model (TEAM), the mandatory episode-based payment model听蹿inalized听last year. Key proposals include:听

• Expanding the list of听MS-DRGs听included in the spinal fusion episode听
• Aligning TEAM quality measurement performance periods with the IQR Program听
• Making targeted technical refinements to payment听methodology听

In addition, CMS is seeking stakeholder feedback on whether ambulatory surgery centers (ASCs) should听participate听in TEAM and whether participation should be voluntary for physician-owned hospitals,听signaling potential future expansion or recalibration of the model.听

Proposed Expansion of Joint Replacement Bundles听

CMS听proposes to听expand the existing听Comprehensive Care for Joint Replacement Expanded (CJR-X) Model听nationwide听beginning October 1, 2027.听The agency also plans to听make participation mandatory for most IPPS hospitals.听

CMS tested the original CJR model in 34 metropolitan areas between 2016 and 2024, generating听improved patient outcomes and net Medicare savings, according to听agency听evaluations. CJR-X听would听become the fifth Center for Medicare and Medicaid Innovation model to meet the statutory criteria for nationwide expansion.听

Under CJR-X, hospitals performing lower extremity joint replacements would be听accountable for the cost and quality of care for the听initial听procedure and most related spending during the听subsequent听90 days.听Although听the overall structure mirrors the original CJR model, CMS proposes several important updates:听

• Expansion of episodes to include ankle replacements, in addition to hip and knee procedures听
• Adoption of a more robust risk adjustment听methodology听with significantly more variables, aligning closely with the TEAM model听
• Introduction of a 5 percent stop-loss policy for hospitals听that听serve听higher proportions of dually eligible beneficiaries and certain smaller hospitals听

Participation would be mandatory for most IPPS hospitals, with exceptions for hospitals already听participating听in TEAM,听which includes a lower extremity joint replacement episode;听Maryland hospitals听operating听under global budgets;听and hospitals not paid under both IPPS and the Outpatient Prospective Payment System,听such as Critical Access Hospitals.听

Why It Matters听

The 2027 IPPS and LTCH PPS proposed rule reinforces several clear policy signals:听

• Pressure on hospital margins is likely to persist, as payment updates continue to trail hospital-reported cost growth.听
• Mandatory episode-based models听remain听central to CMS鈥檚听value-based strategy, with CJR-X听representing听a significant escalation in scope and scale.听
• Program alignment and MA inclusion are accelerating, with implications for hospital data systems, care coordination strategies, and reporting infrastructure.听

Hospitals and health systems will need to assess not only the near-term听蹿inancial impact听of the proposed payment updates, but also their readiness听to accept听expanded episode accountability and听meet听evolving quality measurement requirements.听

Comments on the proposed rule will shape final decisions听regarding听payment levels, quality program changes, and the scope of mandatory participation in CJR-X. Stakeholders will be watching closely to see whether CMS moderates its approach to mandatory models or doubles down on episode-based accountability as a cornerstone of Medicare payment reform.听

In parallel, CMS has released several other proposed听payment听rules this month,听including听those that听would affect听skilled nursing facilities, hospice providers, inpatient rehabilitation facilities, and inpatient psychiatric facilities. For these entities, CMS听generally proposes听payment updates of approximately 2.4 percent听and听2.3 percent for inpatient psychiatric facilities. As part of its broader听program听integrity focus, CMS also听has听proposed new transparency measures for hospice providers; this听蹿ollows听recent enforcement actions related to fraudulent enrollment.听

Connect with Us听

红领巾瓜报, Inc.听(红领巾瓜报),听monitors听蹿ederal regulatory and legislative developments in the inpatient setting and assesses the impact on hospitals, life science companies, and other stakeholders.听Our experts interpret and model hospital payment policies and assist clients in developing CMS comment letters and long-term strategic plans.听Our team replicates CMS payment methodologies and model alternative policies using the most听recent听Medicare fee-for-service and Medicare Advantage (100%) claims data. We also support clients with DRG reassignment requests,听New Technology Add-on Payment (NTAP)听applications, and analyses of Innovation Center alternative payment models.听

For more information about the proposed policies, contact听one of听our听Medicare听experts.听