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Uniform Medical Plan projected to rise $58/month as board reviews 2027 rates
Summary
Staff briefed the board that UMP Classic Medicare premiums are projected to increase about $58 per month (roughly 17%) for 2027, driven by updated Part D subsidy projections, lower risk scores, and lower pharmacy rebate guarantees tied in part to IRA pricing changes.
Agency finance staff told the Public Employees Benefits Board that the Uniform Medical Plan (UMP) Medicare Classic premium proposal for 2027 reflects a substantial increase driven by updated experience and federal subsidy expectations.
"UMP is increasing $58 per month or 17%," Molly Christie, a finance unit presenter, told the board, attributing most of the UMP change to updated Part D CMS subsidy projections that incorporate actual 2025 Part D claims experience. Christie and staff explained that when the agency updated its base claims experience to include 2025, they found a lower than expected risk score and smaller pharmacy rebate guarantees—both factors that reduce federal subsidy and increase plan liability.
Presenters contrasted UMP with Medicare Advantage plans: UMP is a coordination‑of‑benefits product and acts as secondary payer to Medicare, so its medical‑side dynamics differ from Medicare Advantage risk‑adjustment pressures. UnitedHealthcare plans showed even larger rate increases driven by CMS risk‑score model changes and increased utilization among new and existing members; United's PEB membership has grown rapidly to roughly 28,000 members, staff said.
Staff said draft premium resolutions will come back at the July 9 meeting, and noted that participation in the CMS Part D premium stabilization demonstration could allow the agency to lower UMP premiums if CMS continues that program and provides funding for 2027.
