News last week that big Medicare Advantage insurer Humana will once again pull back from some markets is the first major sign more exits from other companies are likely as well.
The moves by Humana and likely others that could be announced in coming weeks and mean tens of thousands of older adults – and potentially hundreds of thousands – will lose their current Medicare Advantage plan and be forced to choose a different option for 2027.
Like other health insurers, particularly those providing privatized Medicare Advantage, Humana has been battling rising medical expenses from customers in its health plans.
In the last two years, that has meant Humana and rivals have been reevaluating the markets where they sell Medicare Advantage coverage, including some that are unprofitable, and announcing they are retreating to markets where they have adequate doctor and hospital networks to offer rich benefit packages at competitive prices. Medicare Advantage providers, including UnitedHealth Group’s UnitedHealthcare, CVS Health’s Aetna and others, exited hundreds of counties for this year.
During last week’s second quarter earnings call, Humana executives said they once again will have “targeted plan exits” for the 2027 health benefit year. Though other companies have yet to confirm exits, they are expected given the industry struggle with costs.
Health insurers every summer summer work on their Medicare Advantage bids, which are proposals they submit every year to the federal government. Among other things, such bids essentially say how much the health insurers expect it will cost to provide benefits to older adults eligible for Medicare Advantage.
Medicare Advantage plans contract with the federal government to provide coverage available in traditional Medicare plus extra benefits and services to seniors, such as disease management, drug coverage and nurse help hotlines with some also offering vision, dental care and wellness programs.
“While it remains too early to provide many specifics regarding our bid strategy, let me provide some perspective on our approach to plan exits,” Humana chief financial officer Celeste Mellet told analysts and investors on the company’s second quarter earnings call.
“To reduce benefit disruption, we will use plan exits to prioritize higher performing plans, including those with greater value-based care penetration,” Mellet added. “This approach is aligned with bid priority number two, which is to retain as many members as possible while making the changes necessary to drive the intended margin expansion. For 2027, we anticipate these plan exits will impact approximately 600,000 members, though we will work to recapture a significant portion of that volume as we did in 2025.”
Millions of older adults enrolled in Medicare Advantage or those who become eligible won’t find out until this fall when insurers unveil their plans during the annual enrollment period. That annual ritual, which older adults can change or choose their Medicare Advantage benefits, runs from October 15 to December 7.