Key Takeaways

Health insurer Humana is dropping Medicare Advantage plans covering about 600,000 people, continuing a surge in terminations that began in 2025.

This year, 1 in 10 people enrolled in a Medicare Advantage plan were forced to switch coverage after their plans were discontinued.

People who lose their Advantage plans have until the end of February to find new coverage. Otherwise, they revert to traditional Medicare.

Millions enrolled in Medicare Advantage plans must choose new coverage or revert to traditional Medicare, potentially disrupting their healthcare.

Humana (HUM) became the latest large insurer to pull back on coverage, saying in a late July earnings call that it would not renew plans covering 600,000 people in 2027. The company said it hoped to enroll many of those beneficiaries in other Humana plans, as many did after exits in 2025.

This year, an estimated 2.9 million people, or one in every 10 people enrolled in a Medicare Advantage plan, were forced to switch coverage after insurers canceled their previous plans, according to an analysis led by Mark Meiselbach, a health care economist at Johns Hopkins University. That’s a jump from 2025, when the rate was 6.9%, and 10 times the 1% average between 2018 and 2024.

Why This Matters to You

Medicare Advantage plans cover more than half—about 34 million people—of Medicare beneficiaries. Terminations mean people have to find new coverage or revert to traditional Medicare, and even a similar plan can mean having different doctors, benefits, and rules.

Medicare Advantage, also known as Medicare Part C, is private health insurance that delivers Medicare benefits, often with extras like dental or vision coverage, as an alternative to traditional Medicare, the federal health insurance program for people age 65 or older and some people with disabilities. This year, 55% of Medicare recipients were enrolled in a Part C plan, according to KFF, a health care research group.

People facing the end of their Advantage plans have until the end of February to find a new one or revert to traditional Medicare. About 99% of those whose plans were terminated at the end of last year had other plans available, according to KFF. However, changing Advantage plans can be disruptive: Plan availability depends on where you live, and a new one might mean changing health care providers and different benefits.

“For most enrollees, they will likely be able to still find a comparable MA plan,” Meiselbach told Investopedia in an email. “However, no two plans are exactly the same. They may still have access to their same primary care provider, but have to undergo new prior authorization for a medication or lose a supplemental benefit they relied on.”

Federal regulations require insurers to notify enrollees by Oct. 2 that their coverage is being terminated for the following year. Those affected can expect letters in the next month.

Health care experts point to several factors behind the recent spike in Medicare Advantage plan terminations. Meiselbach said some of the trend likely stems from a risk-adjustment model, phased in starting in 2024, that lowers government payments to insurers. Enrollees have also been using their benefits more, pushing up costs, according to KFF.

“But the truth is that we can’t yet exactly point to what is responsible with certainty,” Meiselbach said.

In Humana’s case, chief financial officer Celeste Mellet said the company was using plan exits to “prioritize higher-performing plans.” That means shedding its less profitable plans, many of which are rated 3.5 stars or lower by Medicare, as the company aims to boost its overall profitability.

Forced plan terminations are spiking now, but they are always likely to happen to one extent or another as long as health insurance is being offered by private companies, Meiselbach said.

Plan exits are a “part of a privately managed insurance market like this,” he said. “As policies change, the business strategies of certain plans may become more or less profitable, forcing them to adapt or exit.”

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