Medicare Advantage growth slows as plans exit markets
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Medicare Advantage enrollment is declining in seven states this year, an analysis of federal data shows.
Why it matters: The private Medicare program that covers more than half of seniors still is growing nationally, but at a slower rate than in the recent past as rising medical costs and federal policy changes spur a market realignment.
By the numbers: MA enrollment for the 2026 plan year decreased from 2025 levels in Vermont, Wyoming, New Hampshire, Idaho, Minnesota, Maryland and South Dakota, according an analysis from consulting firm Chartis released Thursday.
- New York is the only state where enrollment grew more than 5% this year, compared with eight states last year. Vermont was the only state with a decline in Medicare Advantage enrollment last year.
- 2026 Medicare Advantage penetration information wasn't available for Alaska or Connecticut, Chartis said.
Declining enrollment in those states seems to come from plans exiting the market, rather than seniors' changing preferences, said Alexis Levy, senior partner at HealthScape Advisors and a co-author of the Chartis analysis.
- Plans have increasingly pulled out of markets around the country that they no longer see as financially viable.
- About 1 in 10 beneficiaries had to switch plans this year because their previous choice was no longer offered, according to a recent study published in JAMA.
Zoom out: Humana emerged as a clear winner of this year's Medicare Advantage sign-up season, gaining nearly 1.2 million people, or nearly 21% of enrollment, per Chartis.
- UnitedHealth Group's MA enrollment dropped more than 5% this year compared with last, but it remains by far the largest insurer in the market with nearly 9.3 million enrollees.
- Devoted Health, a health insurance startup, more than doubled its membership this year and now covers about 455,000 enrollees. The company has leaned heavily into specialized plans that serve high-needs enrollees.
What we're watching: Health insurance leaders surveyed by Chartis this year had a more positive five-year outlook for the MA program than they reported last year, though most predicted they'll have to further decrease benefits for seniors in 2027.
- Most of those responses were collected before the Trump administration proposed a flat payment update for 2027, which shocked the MA market.
- If the administration doesn't significantly increase that rate, "some may view that as a final straw, and make more decisions to exit," Levy said.
- "I don't think leaders want to exit the market, but they may be forced to if they don't see a good financial path forward."
