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Attachment VII. Economic Information for the CY 2026 Rate Announcement Below, we provide the economic information for significant provisions in the Rate Announcement. Provisions not specifically addressed below are intended to represent a continuation of the policies established for CY 2025 and, as a result, do not have an impact associated with them. Section A. Changes in the Payment Methodology for Medicare Advantage and PACE for CY 2026 A1. Medicare Advantage and PACE non-ESRD Ratebook The FFS growth percentage for the 2026 MA non-ESRD rates is estimated to be 8.81 percent, and the MA growth percentage for the 2026 MA non-ESRD rates is estimated to be 10.72 percent. The MA non-ESRD ratebook impact summarized here is calculated by comparing 2026 Part C expenditures reflecting these growth rate assumptions to the expected 2026 Part C expenditures assuming the MA non-ESRD ratebook remains unchanged from that finalized for 2025. The net impact on the Medicare Trust Funds for CY 2026 is expected to be $38.73 billion. This figure accounts for the impact of the benchmark rate cap, MA rebate, and MA EGWP policies, as well as the portion of the difference between benchmarks and bids that the government retains, and the portion of the program costs covered by Part B premiums. The MA growth percentage, used to calculate the 2026 PACE non-ESRD rates as well as in development of the applicable amount used in setting MA non-ESRD rates, is estimated to be 10.72 percent. The PACE non-ESRD ratebook impact is calculated by comparing the 2026 PACE expenditures reflecting this growth rate assumption to the expected 2026 PACE expenditures assuming that the PACE non-ESRD ratebook remains unchanged from the CY 2025 PACE non-ESRD ratebook. The net impact on the Medicare Trust Funds for CY 2026 for the PACE ratebook change is expected to be $280 million. This figure accounts for the portion of the program costs covered by Part B premiums. The net impact on the Medicare Trust Funds for CY 2026 of implementing the zero-claims adjustment in Puerto Rico is expected to be $320 million. A2. Medicare Advantage and PACE ESRD Ratebooks The FFS growth percentage for the 2026 MA ESRD rates is estimated to be 6.79 percent. The impact on the MA and PACE ESRD ratebooks is calculated by comparing projected 2026 Part C expenditures with this growth rate assumption to the expected 2026 Part C expenditures with the assumption that the MA and PACE ESRD ratebooks would have been unchanged from those finalized for CY 2025. The net impact on the Medicare Trust Funds for CY 2026 is expected to be $2.15 billion. This figure accounts for the portion of the program costs covered by Part B premiums.