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and the share of Part A-only beneficiaries growing over time. Commenters offered policy suggestions such as making the Puerto Rico benchmark adjustment nationwide. Response: We refer commenters to the detailed response that we provided in the CY 2020 Rate Announcement regarding use of FFS data for costs of all Medicare beneficiaries, whereby CMS concluded that it finds the current ratebook methodology (our longstanding policy of considering costs of beneficiaries with Part A and/or Part B) to be consistent with section 1853(c)(1)(D) of the Act. We continue to believe that it is not necessary to change the methodology at this time, nor is it required as the statutory language clearly permits CMS to include Medicare beneficiaries who have Part A only or Part B only. While we recognize that calculating rates based on data that excludes beneficiaries entitled only to Part A would yield different results than calculating rates based on our current methodology, that fact alone does not determine which methodology should be employed. With respect to Puerto Rico, we have discussed in past Advance Notices and Rate Announcements that while most Medicare beneficiaries are automatically enrolled in Part B and must opt out to decline it, beneficiaries in Puerto Rico must take affirmative action to opt in to Part B coverage. As a result, we will finalize for CY 2026 an adjustment to the FFS rate calculation for Puerto Rico used to determine MA rates so that it is based only on the Medicare costs for beneficiaries with both Part A and Part B. For CY 2026 we will continue to calculate FFS spending for the purpose of establishing MA benchmarks using FFS claims and utilization data for beneficiaries in Part A and/or Part B. We appreciate the suggestions submitted by commenters, and we will continue to analyze this issue and consider whether any adjustments to the methodology on this point may be warranted in future years. Comment: Commenters were concerned with the proposal regarding the retirement of the Denominator file used in the tabulation of FFS experience. Commenters indicated that multiple adjustments will reduce the MA benchmarks below projected costs for MA enrollees and that the change in FFS enrollment tabulation methodology will adversely impact certain geographic areas. Commenters requested that CMS provide additional information on the expected impact of the change. Commenters also urged CMS to mitigate any impacts on the MA rates. One commenter requested CMS share the source of enrollment data underlying the 2023 legacy FFS costs. Response: CMS appreciates the concerns raised by commenters. As discussed in past Rate Announcements,6 given that MA county rates are based on FFS costs, we believe it is important to update the FFS per capita cost estimates using the most current FFS data available. Projected

6 Please refer to previous Rate Announcements available at https://www.cms.gov/medicare/payment/medicare-advantage-rates- statistics/announcements-and-documents.