The Escalating Growth of Spending on Medicare Advantage Plans: A 2026 Update on Controlling Costs, Preserving Medicare Solvency, and Balancing the Federal Budget.

BACKGROUND: In September/October 2025, Manchikanti et al. published an analysis showing that Medicare Advantage (MA) spending growth was outpacing traditional fee-for-service (FFS) Medicare, driven by favorable selection, risk-adjustment coding intensity, and quality bonus payments, and warned that this trajectory threatened both Medicare's Hospital Insurance (HI) trust fund solvency and physician payment stability. Frantz et al. also published a leadership perspective describing promises and challenges of Medicare Advantage. In the year since, MA now covers more than half of all Medicare beneficiaries, Centers for Medicare & Medicaid Services (CMS) has undertaken the largest Risk Adjustment Data Validation (RADV) audit expansion in program history, a federal court has struck down CMS's ability to extrapolate audit findings across whole contracts, and a separate court has found CMS exceeded its statutory authority in administering the Quality Bonus Program (QBP). Despite these changes, MA plans continue to be rewarded by both parties, with corresponding, rather devastating cuts to physician payments. OBJECTIVE: To update 2025 analysis with developments through mid-2026, quantify the current scale of MA overpayment using the most recent Medicare Payment Advisory Commission (MedPAC) and Medicare Trustees data, summarize the regulatory and legal actions taken to control MA spending since publication of the original article, examine quality of care, access, out-of-pocket costs, and prior authorization/non-coverage practices including specific implications for interventional pain management and provide updated, actionable recommendations to control MA cost growth, preserve Medicare solvency, and contribute to balancing the federal budget. METHODS: Narrative update drawing on the 2025 and 2026 Medicare Trustees Reports, MedPAC's March 2025 and subsequent 2026 status reports, CMS rate announcements and audit policy releases, and contemporaneous legal and policy analyses from the Committee for a Responsible Federal Budget (CRFB), Kaiser Family Foundation (KFF), the Center on Budget and Policy Priorities, and Health Affairs Forefront, current through August 2026. RESULTS: MA now enrolls over half of Medicare beneficiaries and is projected to cost $615 billion in 2026, approximately 14% ($76 billion) more than equivalent FFS spending, with MedPAC's coding-intensity estimate revised to 10.3% above FFS following full phase-in of the 2024 CMS-Hierarchal Condition Category (HCC) (V28) risk-adjustment model. The QBP will pay plans $13.4 billion in 2026 despite MedPAC's finding that star ratings do not reliably reflect care quality, a conclusion reinforced by a May 2026 federal court ruling that CMS exceeded its statutory authority in setting 20 star-rating measures. CMS's May 2025 expansion of RADV audits to all approximately 550 eligible MA contracts was substantially undermined by a September 2025 court ruling barring extrapolation of audit-sample findings across a contract's full enrollee population, though CMS confirmed in January 2026 it would continue the audit rollout. The Committee for a Responsible Federal Budget projects $1.2 to $1.3 trillion in cumulative MA overpayments over 2026-2035, a reduction of roughly one-third from earlier projections but still the largest identified source of Medicare overpayment. Despite these developments, the 2026 Medicare Trustees Report confirms Hospital Insurance trust fund insolvency in 2033, with the 75-year actuarial shortfall widening to 0.56% of payroll and total unfunded obligations rising to $65.3 trillion. CONCLUSION: One year after our original analysis, the fundamental problem persists: MA spending growth continues to outpace the value delivered, and reforms enacted or attempted to date the V28 risk-model phase-in, RADV audit expansion, and quality-bonus scrutiny have been partially offset by litigation, incomplete implementation, and continued benchmark and quality-bonus design flaws. Federal oversight data released in the past year show that some of MA's apparent cost and utilization advantages coincide with denial and non-appeal patterns that its own regulators describe as concerning, and prior-authorization burden historically associated with MA is now migrating into traditional FFS Medicare for core interventional pain procedures. At the same time, interventional pain physicians have experienced cuts in payments (45%) without inclusion of sequester cuts. Achieving durable Medicare solvency, a balanced federal budget, and genuinely improved beneficiary access will require the risk-adjustment, benchmark, quality-bonus, and prior-authorization-transparency reforms detailed in this update, sustained through legislative and regulatory follow-through rather than administrative action alone.