Rising health costs and reduced government payments are causing some insurers to scale back Medicare Advantage benefits and others to exit certain markets entirely. And a new article from The Wall Street Journal finds that the shift is extending to the Affordable Care Act (ACA) marketplace and Medicaid. If the trend continues, seniors will face fewer plan options, reduced benefits, and higher premiums and out-of-pocket costs.
Aetna is the latest insurer to announce it will pull the plug on some of its Medicare Advantage plans next year.
The company said it will close approximately 90 Medicare Advantage plans across 34 states in 2026, according to Modern Healthcare. Most of the plans are PPOs, the publication said.
The news follows UnitedHealthcare’s announcement that next year it will exit some Medicare Advantage PPO plans that impact about 600,000 members. Humana revealed in its first quarter 2025 management remarks that it is likely to lose 550,000 Medicare Advantage members by the end of the year as it leaves plans and markets that aren’t profitable.
The Wall Street Journal article said that the Medicare Advantage market isn’t the only one facing exits and benefit cutbacks. The ACA marketplace and Medicaid are facing similar issues, it said. Rather than focusing on growth, insurers across these markets are turning their attention to leaner operations and profitability.
The moves could be good news for smaller, regional, and health-system-owned Medicare Advantage plans. Rob Hitchcock, president and CEO of Intermountain’s Select Health, told Becker’s Payer Issues that larger insurer exits will help level the playing field, particularly for community health plans. “What you want is a healthy mix,” he told the publication. “. You do want the national players to be strong, but you also want the community health plans to be strong.”