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According to Q2 2025 earnings data, Medicare Advantage (MA) is facing notable pressure. Between challenges such as the rollout of Version 28 (v-28) risk adjustment, rising pharmacy costs and persistently high medical loss ratios (MLR), many carriers are finding it difficult to balance plan richness, affordability and profitability across the board. Alongside continuous pressures from CMS to maintain plan value and effectiveness, MA organizations are operating in a more challenging environment—one that demands sharper focus and smarter cost control.
Pharmacy costs continue to climb—driven by factors such as specialty drugs, GLP-1 utilization and inflationary pressures across the supply chain. Many plans are also grappling with elevated MLRs as members resume deferred care and chronic conditions become more complex. Adding to this strain, CMS’s v-28 risk adjustment model has reclassified several commonly coded chronic conditions, contributing to lower average risk scores and reduced revenue for some plans.
These pressures are compounding at a time when Star Ratings volatility adds another layer of uncertainty. Together, they’re squeezing margins and intensifying the need for proven, high-impact cost-control strategies.
Plans that double down on adherence now will emerge stronger. Related reading: Navigating Medicare Advantage SDS Risk Adjustment Changes to Adherence Measures
The Silver Lining: Adherence as a Strategic Lever
In tight-margin environments, programs focused on medication adherence offer insurers a powerful lever to improve both financial and clinical performance. For example, analyses from AdhereHealth estimate that for every dollar spent on adherence, health plans can conservatively save $2.28 in total cost of care—underscoring the measurable return on investment of keeping members adherent and engaged in their care.
This builds on the perspective outlined in our recent article, “Navigating Medicare Advantage SDS Risk Adjustment Changes to Adherence Measures,” which reinforces that CMS is not deprioritizing adherence—it’s reframing it. Beginning in Measurement Year (MY) 2026, the three Part D adherence measures will include sociodemographic (SDS) risk adjustment, making adherence a more equitable and accurate reflection of performance for plans serving higher-risk and lower-income members.
In behavioral terms, adherence is a modifiable lever—one that responds to proactive engagement, personalized communication and trust-building. Plans that treat adherence not as a compliance metric, but as a whole-team, whole-person journey are finding new ways to both control spending and retain members in an increasingly competitive market.
Improved adherence offers MA plans several distinct advantages:
- Mitigating cost spillover: Strong adherence helps reduce avoidable acute care utilization—such as ER visits or hospitalizations—helping offset v28-driven cost pressures.
- Driving sustainable value: Better medication and care compliance stabilizes member health outcomes, strengthening value-based care models amid reduced risk-adjustment support.
- Enhancing member experience: Personalized adherence interventions—through remote monitoring, digital nudges, and care coaching—reinforce engagement, make plans feel more tangible, and deepen member trust.
Smart tactics for payors to lean in
Here’s how plans can double down on adherence in today’s MA landscape:
- Deploy predictive analytics
AI-driven insights can flag gaps in medication refills or care visits before they occur—triggering timely, targeted interventions. The most effective models combine claims, pharmacy and behavioral data to identify why nonadherence is likely, not just when. Real-time alerts enable outreach teams to act early, preventing costly downstream utilization. - Invest in digital outreach tools
Platforms like mobile apps, SMS reminders and patient portals help members stay connected to their care schedule and treatment plans. Research shows omnichannel approaches—combining phone, SMS, digital text and mailers—improve adherence compared with single-channel efforts. For example, one study of two MA-PD plans found that an omnichannel adherence intervention improved adherence rates by 5–7 percentage points across multiple chronic conditions. - Strengthen care coordination
Pairing care navigators, pharmacists or prescribers with high-risk members fosters adherence through personalized support and accountability. The human connection—rooted in empathy and trust—remains one of the strongest predictors of sustained adherence. - Align incentives with outcomes
Consider embedding adherence performance in provider contracts or plan design—rewarding improved member compliance with benefits or network placement. Even small benefit enhancements—like reduced copays or OTC credits for adherent members—can nudge healthier behaviors and drive measurable performance improvements. - Measure and iterate
Track adherence metrics (e.g., PDC for chronic meds, follow-up appointment rates) alongside cost and utilization data. Educate providers on how improved adherence supports value-based model performance and long-term plan health.
Looking ahead: the competitive edge in a more challenging economic environment for payors
MA plans are navigating an era of constrained margins shaped by multiple forces—rising pharmacy costs, high MLR, evolving risk adjustment and ongoing CMS scrutiny. Amidst these pressures, adherence remains one of the most powerful and sustainable levers to stabilize both finances and member outcomes.
Adherence is one of the few strategies that simultaneously:
- Lowers cost
- Protects revenue
- Improves outcomes
- Advances health equity
- Strengthens Star Ratings
The plans that act now to strengthen adherence programs won’t just weather today’s uncertainty. They’ll emerge stronger, more resilient and better positioned for long-term success.
In an environment defined by financial headwinds and shifting policy expectations, adherence isn’t just a metric—it’s the bridge between sustainability and success.
Want to drive increased medication adherence? Contact us today to learn more!
Authored by:
Kempton Presley, MPH, MS
Chief Executive Officer
AdhereHealth
