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Policy Medicare proposal would cap costs for patients misled by wrong provider directories

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Tuesday, November 3, 2026 From the publisher Free hospital price search Published bysoro
The Care Ledger

Policy

Medicare proposal would cap costs for patients misled by wrong provider directories

A proposed rule carrying out a 2026 law would also limit how drug benefit managers are paid in Part D and end generic drug copays for the poorest enrollees in 2028.

  • The Care Ledger
  • 3 min read
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  • Reviewed by an editor
A clinic waiting room with black chairs and a television on the wall
A waiting room at a medical clinic. Photo: Harrison Keely, via Wikimedia Commons (CC BY 4.0)

The Centers for Medicare & Medicaid Services (CMS) proposed on Oct. 16 that Medicare Advantage enrollees who see an out-of-network doctor because their plan's online directory wrongly listed that doctor as in network would owe no more than in-network cost sharing. The proposed rule1 carries out three sections of the Consolidated Appropriations Act, 2026, and its main provisions would apply starting in plan year 2028. It would also limit how pharmacy benefit managers (PBMs) are paid in the Part D drug program and drop generic drug copays to $0 for about 6 million of the lowest-income enrollees.

Directory errors can be costly for patients. In the rule, CMS notes that a wrong network listing can lead someone to unknowingly receive out-of-network care, which may result in higher costs. Under the proposal, a plan that collected more than the in-network amount would have to refund the difference, and the refunded cost sharing would count as in-network spending toward the enrollee's annual out-of-pocket limit.

How the directory protection would work

To qualify, the provider must have been listed in the plan's directory on the date the appointment was made, and plans would have to apply the protection without a request when they know or should know it applies. CMS's example in the rule describes an enrollee who books a cardiologist the directory lists as in network, later receives an explanation of benefits (EOB) showing out-of-network cost sharing, and has the charge capped once the plan confirms the listing.

Plans would also have to verify each directory listing at least every 90 days, or every 12 months for hospitals and certain other facilities, analyze accuracy every year and report an accuracy score to CMS, according to the rule and a CMS press release2. For contract year 2029, CMS would publish the scores, and plans would have to display them in their directories. The Association of American Medical Colleges noted in its summary of the rule3 that the work falls mainly on plans, but providers will be asked to confirm their information more often.

Limits on PBM pay and lower copays

The PBM provisions take aim at how drug middlemen earn money in Part D. Starting in plan year 2028, payments to PBMs and their affiliates tied to Part D drugs would be limited to bona fide service fees that reflect fair market value. Under the proposal, those fees must be flat dollar amounts and cannot be based on a drug's list price, on the size of rebates, or on formulary placement. PBMs would also have to report compensation and cost data to plan sponsors and CMS, disclose the terms of price guarantees and certain agreements with drugmakers, and pay back to CMS any money received in violation of the limits.

CMS said it could not estimate the financial effect of the PBM rules because it lacks data on PBM contracts and current fee levels. It cited a Congressional Budget Office estimate that the fee limit would reduce federal direct spending by about $444 million from 2026 to 2035.

The third change lowers drug costs for the poorest Part D enrollees. People who qualify for both Medicare and full Medicaid benefits, with incomes at or below 100% of the federal poverty level, currently pay a small copay for generic drugs, set at $1.60 for 2026. The law sets that copay at $0 for plan years starting Jan. 1, 2028. CMS estimates the change would cost the federal government a net $1.337 billion from 2028 to 2037, as Medicare absorbs copays enrollees now pay and generic drug use rises.

The directory and PBM provisions come from the REAL Health Providers Act and a PBM accountability section that Congress folded into the spending law enacted Feb. 3, 2026.

What comes next

Comments are due by 5 p.m. Eastern on Dec. 15, 2026. Any new marketing and communications rules would apply to materials for contract year 2028 starting Oct. 1, 2027. CMS said a separate proposed rule with its broader 2028 Medicare Advantage and Part D policy changes would follow later this fall.

Sources

Every figure in this story was checked against these sources on Friday, October 16, 2026.

  1. 01Federal Register (Centers for Medicare & Medicaid Services), "Medicare Program; Implementation of Sections 6219, 6220, and 6224 of the Consolidated Appropriations Act, 2026" (proposed rule CMS-4214-P, FR Doc. 2026-21420), public inspection copy filed October 16, 2026, published October 20, 2026public-inspection.federalregister.gov
  2. 02Centers for Medicare & Medicaid Services, "CMS Proposes Reforms to Strengthen Transparency and Affordability in Medicare Advantage and Part D" (press release), October 16, 2026cms.gov
  3. 03Association of American Medical Colleges, "CMS Proposes to Implement PBM and Provider Directory Changes in Medicare Advantage", October 23, 2026aamc.org
  4. PhotoA waiting room at a medical clinic. Photo: Harrison Keely, via Wikimedia Commons (CC BY 4.0).commons.wikimedia.org

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