Medicare Advantage customers are facing a shrinking pool of insurers as some companies plan to withdraw from unprofitable markets and reduce service in others. Humana, CVS, and some smaller insurers have announced their intentions to downsize their market share, forcing affected customers to find another plan or return to Original Medicare. UnitedHealthcare, the largest insurer, remains the outlier with no plans to reduce current or new enrollments.
Medicare Advantage plans are private health insurance that restrict patients to in-network physicians and hospitals, unlike Original Medicare, which is administered by the federal government. Hospitals claim that reimbursements from Medicare Advantage plans are too low to cover costs, while insurers say they’re seeing profit margins shrink. CVS Health Aetna and Humana, the largest providers stating their intentions to shrink their share of the Medicare Advantage market, cite cost concerns and shrinking profits as reasons for their decisions.
Medicare Advantage market shifts underway
Centene, which provides Medicare Advantage plans to approximately 4% of beneficiaries, will also be ending its plans in at least six states this year, impacting roughly 37,000 members. The Centers for Medicare & Medicaid Services (CMS) recently finalized a slight decrease in Medicare Advantage benchmark payments for 2025 and revised how plans adjust for members’ risk quality or “star” ratings, which insurers believe is not sufficient to cover current medical cost trends.
If your Medicare Advantage plan is ending, you should receive a letter in early October explaining that it will no longer be available next year. You have two opportunities to enroll in a new plan: during the general Open Enrollment period from October 15 through December 7 and a Special Enrollment Period from December 8 through February 28. Advantage plan members who default into an Original Medicare plan should consider buying additional coverage, such as Part D prescription drug coverage and Medigap (Medicare Supplement Insurance), to help pay for out-of-pocket costs not covered by Original Medicare.
Even if you are satisfied with your current plan, staying informed about other options in your market will help you prepare for any unexpected changes to your coverage.
- Kiplinger.”Medicare Advantage Customers Face Shrinking Pool of Insurers”.
- InsuranceNewsNet.”Medicare clients ask about prior authorizations, higher premiums”.
- Forbes.”Will Big Health Insurers Expand 2025 Medicare Advantage Footprints?”.