Potential Changes to Medicare Advantage Plans in Maryland
Major insurance companies are contemplating the discontinuation of Medicare Advantage plans next year, which will leave many retirees in Maryland without their existing healthcare options.
About 25% of Maryland’s Medicare recipients currently rely on supplemental Medicare care programs. These programs assist low-income retirees in accessing private insurance and often provide added services like vision care, dental care, and transportation support.
State officials and healthcare professionals indicate that the cost of the Medicare Advantage market in Maryland exceeds that in many other states, largely due to the distinct hospital payment system in place. Over recent years, grants have been offered to help insurers manage these costs and encourage them to maintain coverage in the state.
However, with the disappearance of these grants, some companies are re-evaluating their Medicare Advantage offerings in Maryland.
“In the past five years, Medicare Advantage has faced significant challenges in our state. These issues have disrupted health plans for beneficiaries who depend on these services,” a local health official stated.
The core issue stems from a mismatch between Maryland’s hospital pricing and the federal reimbursement rates for services under the Medicare Advantage plan.
“The Maryland system is unique, and it puts pressure on Medicare Advantage,” noted Gene Ransom, CEO of Medchi, associated with the Maryland Medical Association.
The complexity arises from Maryland’s total cost payment model, wherein a state board called the Health Services Cost Review Committee (HSCRC) determines hospital rates. Insurance companies in Maryland face higher hospitalization fees compared to other states, yet the federal reimbursements for Medicare Advantage services are lower than what is received elsewhere. Additionally, insurance firms cannot negotiate hospital fees under this model.
As a result, utilizing Medicare Advantage in Maryland becomes more expensive and provides fewer benefits for seniors, according to a spokesperson from Carefirst.
“We are worried that Maryland seniors lack access to the affordable, high-quality Medicare Advantage plans available in other regions, complicating their ability to receive necessary care,” the spokesperson expressed. “Seniors in Maryland deserve the same robust and cost-effective benefits as their counterparts in other states.”
Maryland is home to 1.1 million Medicare beneficiaries, with around 295,000 enrolled in the Medicare Advantage plan. This participation rate is below 27%, one of the lowest in the nation, only surpassing states like North Dakota (25%) and Alaska (2%). Generally, most states see at least 50% participation from Medicare beneficiaries.
“The losses incurred by Medicare Advantage Plans over recent years are increasing,” Puente remarked.
For the last few years, HSCRC has provided grants to encourage insurers to keep offering Medicare advantages in Maryland. Adam Kane, a former HSCRC committee member, noted that these grants were intended as a short-term fix for a longstanding issue.
“Initially, we created a grant program to stabilize the Medicare Advantage market, hoping for long-term federal solutions,” Kane recalled. “At present, there’s no permanent resolution aligning Maryland’s hospital pricing model with Medicare Advantage reimbursements.”
Consequently, analysts predict that some companies may opt to withdraw from the Maryland market altogether.
“We’ve heard that some large public Medicare Advantage plans might exit Maryland, causing more disruptions for beneficiaries who will have to switch to different plans or forgo extra benefits,” Puente stated. “These supplementary benefits often cover essentials like hearing aids, dental care, vision, and transportation, which are sometimes neglected with traditional Medicare.”
Major plans available in Maryland include Aetna, Humana, Cigna, and United Healthcare, but details regarding the offerings for the upcoming registration period are still uncertain.
“We will share more as Massachusetts benefits and markets for 2026 are released in early October,” a representative from United Healthcare mentioned.
Humana’s Communications Director, Mark Taylor, also stated, “We won’t be able to provide insight regarding MA services for 2026 until the annual enrollment period begins in October.”
This isn’t the first instance of changes in Medicare Advantage plans in the state. In 2021, Johns Hopkins Medicine ended plans for Baltimore residents, pushing 5,000 seniors out of their plans to find new options.
Andrew Rosenberg, president of Health Resource Advisors, highlighted the negative impact of losing healthcare coverage for older adults who rely on consistent medical services for their health needs. “Any change, even something as seemingly minor as a new pharmacy, can be detrimental. It can force them to find new doctors, which disrupts their ongoing care,” he noted.
Meanwhile, Maryland’s healthcare model is about to undergo significant changes as state and federal officials finalize new conditions aimed at enhancing health equity in the state.
Current negotiations appear to push for solutions to stabilize Medicare advantages, with potential significant alterations in the state’s pricing authority for Medicare.
“We hope that both state and federal authorities will work together to devise solutions that safeguard Medicare beneficiaries in Maryland,” Puente added.
