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Tuesday, October 27

Humana and UnitedHealthcare Are Dropping Medicare Advantage Plans. Here’s Why, and What to Do Before Your Deadline

Older woman at a farmhouse kitchen table reading a letter, with prairie fields and a grain elevator outside the window

About a million older Americans are about to find out how temporary a “Medicare plan” can be.

Two of the country’s biggest health insurers, Humana and UnitedHealthcare, told CBS News on Oct. 23 that they’re ending Medicare Advantage plans for 2027. Humana said its plan exits will affect roughly 600,000 members. UnitedHealthcare confirmed it’s closing one plan that covers about 390,000 people. If you’re in one of them, a letter should already be sitting in your mail pile.

Here’s what’s driving it, and the handful of moves that actually matter if it’s you.

This isn’t a one-off

NPR reports that plan closures have been happening at an increasing scale for three years running. Last year, 2.9 million seniors were in Medicare Advantage plans that shut down, according to JAMA research cited by NPR. Early estimates for 2027 range from at least 2 million to as many as 5 million people.

The map is changing too. A KFF analysis of federal plan data found that 193 counties will have no Medicare Advantage plan with drug coverage open to general enrollment in 2027, up from 123 counties this year. About 638,000 people live in those counties, mostly in rural areas across 16 states. All of Alaska is on the list.

KFF also found that UnitedHealth Group is pulling out of 228 counties while entering just 9, and Humana is leaving 62 counties while entering 4. Cities aren’t immune. NPR, citing KFF’s numbers, reports that Dallas, Minneapolis, Seattle, Houston, and Portland each have between a quarter and a third fewer plans to choose from.

So why is it happening?

The short answer is money.

Medicare Advantage lets private insurers run Medicare benefits for people who choose it, and the government pays them to do it. NPR notes that more than half of the roughly 70 million people on Medicare are in these plans. They’re popular because they often bundle drug coverage, dental, and vision, frequently with low premiums.

But the plans only work for insurers if what they’re paid covers what members use. UnitedHealthcare told CBS News it’s facing higher costs and increased member use of care, pressures it says are hitting the whole industry. Humana’s statement was vaguer, saying it regularly reviews its Medicare offerings to keep care “affordable” and “coordinated.”

The structure makes exits easy. As NPR puts it, insurers can pick and choose where to offer plans, and if a community isn’t profitable, they can leave. Traditional Medicare, run by the federal government, doesn’t have that option. It’s available everywhere.

What happens if you do nothing

This is the part that trips people up. According to NPR, if your plan ends and you don’t choose something, the insurer will either move you to another one of its Medicare Advantage plans or leave you in traditional Medicare without a supplement or a drug plan.

Your real deadlines

You’ve probably heard “Dec. 7.” That’s the end of Medicare’s annual open enrollment, which started Oct. 15. It’s the cleanest deadline to aim for, especially since NPR notes insurers can cap enrollment on some plans this year, so a plan you want could fill up.

But if your plan is being discontinued, you get more time. KFF explains that people whose plan isn’t renewing typically get a Special Enrollment Period that runs from Oct. 15 through the last day of February. There’s also the Medicare Advantage Open Enrollment Period from Jan. 1 to March 31.

Treat the extra time as a safety net, not a plan. Choosing by Dec. 7 means your new coverage starts Jan. 1 with no gap.

The rare opening: Medigap without health questions

Normally, if you want to leave Medicare Advantage for traditional Medicare plus a Medigap supplement policy, insurers in most states can ask about your health and charge you more or turn you down.

A closing plan changes that. Under Medicare’s guaranteed issue rights, when your Medicare Advantage plan leaves Medicare or stops serving your area, insurers can’t refuse to sell you certain Medigap plans (A, B, D, or G, plus C or F if you were eligible for Medicare before 2020). Medicare’s Medigap guide says you generally must apply no later than 63 days after your Medicare Advantage coverage ends, and the Medigap policy can’t start until that coverage ends. Keep that termination letter. It’s your proof.

Some states give extra protections, so check with your State Insurance Department. And if you go this route, you’ll still need a separate Part D drug plan.

A simple game plan

We walked through the common mistakes people make when a plan ends in Losing Your Medicare Advantage Plan? Don’t Make This Mistake, so here’s the short version.

  • Find your letter, or log in at Medicare.gov to confirm your plan’s status.
  • List your doctors, hospitals, and every prescription before you shop.
  • Compare plans in Medicare Plan Finder, checking networks and drug costs before premiums.
  • Price traditional Medicare plus Medigap and Part D while your guaranteed issue right is open.
  • Get free help from your State Health Insurance Assistance Program at shiphelp.org. With so many people shopping, NPR warns it may take longer than usual to reach someone, so call early.

The bottom line

Medicare Advantage plans can disappear. That’s not a scandal; it’s how the program is built. Your traditional Medicare benefits aren’t going anywhere, and a closing plan hands you something most people never get: a no-questions-asked shot at Medigap. Don’t let the default pick for you. Make your choice by Dec. 7 if you can, and know you have until the end of February if you need it.

Sources

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