Medicare Advantage Changes Announced by Major Insurers

Medicare & Medicaid Services Administrator Dr. Mehmet Oz revealed significant updates regarding Medicaid, the impact on hospitals, and the milestone of the program’s 60th anniversary. In a notable announcement, it was stated that health insurance companies will scale back their Medicare Advantage offerings next year to manage the potential decline in government rebates.

The U.S. government plans to reduce payments for Medicare benefits starting in 2024, aiming to curtail spending. Medicare Advantage, which provides tailored insurance for those over 65 and individuals with disabilities, has seen some shifts as a result.

CVS Health’s Aetna Insurance will expand its prescription drug plans to 100 additional counties in 2025. On the other hand, Humana has opted to reduce its offerings, lowering availability from 89% to 85%. UnitedHealth, managing the largest share of the Medicare Advantage market, is set to withdraw from 109 counties, impacting roughly 180,000 people.

Interestingly, as major players in the industry, UnitedHealth, Humana, and CVS Health navigate these changes, they cite unexpected usage of Medicare services as a driving force behind the decision to exit less profitable markets. Bobby Hunter from UnitedHealth mentioned that funding cuts alongside rising healthcare costs and increased service demands have created challenges that cannot be overlooked.

Insurance companies have notably retreated from some states where government compensation has been inadequate and costs have surged due to higher utilization of services.

In 2026, Humana aims to provide plans in 46 states, down from 48 this year. Aetna anticipates coverage in 43 states, reducing its reach from 44 states and 2,259 counties previously. Humana is also exploring new plan types in four states, with expectations that a significant portion of its standalone prescription drug plans will see reduced premiums.

Meanwhile, CVS Health has plans to extend its Medicare and Medicaid program offerings to include 16 new states, which could improve access to low-income Americans.

In closing, Hunter’s remarks on UnitedHealth’s cuts suggest that the decision will impact around 600,000 members enrolled in their preferred provider organization, who will still have the option to access providers outside the set network.