Medicare Advantage: UnitedHealthcare, Humana Drop 990,000 Members

The headline number

The two largest private insurers in Medicare are ending Medicare Advantage plans that cover about 990,000 people for 2027. UnitedHealthcare accounts for about 390,000 of them and Humana for about 600,000.23 A UnitedHealth Group spokesperson confirmed the UnitedHealthcare figure. Humana's chief financial officer, Celeste Mellet, disclosed the company's number on a July earnings call, and it equals roughly 8% of Humana's 7.2 million Medicare members.24

The cuts take effect January 1, 2027. A UnitedHealthcare member who does not pick a new Medicare Advantage plan will be moved to Original Medicare on that date. The drug coverage built into the cancelled plan ends at the same moment.6 Open enrollment runs from October 15 to December 7. People whose plans are not renewed also get a special enrollment period from December 8, 2026, through February 28, 2027.69

On its own, this is a routine story about insurers trimming their product lines. It matters more because it is happening alongside other cost increases. Part D drug coverage is changing, employer premiums are heading for their biggest rise in about two decades, and Medicaid's new eligibility rules start the same day these plans end. Together, those shifts push more health care costs onto patients in 2027.

What the insurers are cutting, and why

The cuts are aimed at specific products. They fall mostly on preferred provider organization (PPO) plans, which let members see doctors outside the insurer's network.2 UnitedHealthcare President Bobby Hunter said on the company's October 13 earnings call that the 2027 PPO cuts continue a strategy, several years old, of favoring HMOs and special needs plans.4 The plan counts show the trade. UnitedHealthcare will offer 852 Medicare Advantage plans in 2027, up from 846. It is dropping 34 PPO plans and adding 40 special needs plans, and its standard plans will disappear from 140 counties.8

Humana says it is cutting selectively. Mellet said the company is ending lower-return plans and keeping higher-return ones.4 One industry summary says most of the affected Humana plans have star ratings of 3.5 or lower, and that leadership wants Medicare Advantage margins back to at least 3% by 2028.9 That is a profitability goal, and the company has said so plainly.

An actuary at Oliver Wyman, Brooks Conway, described the logic: when an insurer ends a plan, it either wants to lose those members or move them into a leaner, more profitable product.47 The financial background supports that reading. Medicare Advantage use and costs ran higher than UnitedHealth Group expected, which hurt its stock in 2025. The company has since shrunk its Medicare Advantage enrollment to 7.6 million.4

The coverage differs on how many people Humana will keep. Several outlets say Humana hopes to move about 40% of affected members, roughly 240,000 people, into its other plans.189 Another account says the company has not estimated how many will stay.6 The 40% figure is best treated as a goal, not a forecast.

The "stable" market and what members actually pay

Washington describes the market very differently. The Centers for Medicare & Medicaid Services (CMS) calls 2027 "stable." It projects the weighted average Medicare Advantage premium will fall from $14.37 to $12.00 a month, and it says 97% of beneficiaries will have at least 10 plans to choose from.11 Administrator Mehmet Oz described the premium decline as the result of cutting "handouts to big insurance companies."11 The total number of plans barely moves, from 5,553 to about 5,532.1

Average premiums, though, are a poor guide to what the plans will cost members. Insurers are raising cost-sharing, narrowing networks and trimming extra benefits.4 An October 1 Leerink Partners review of Medicare Plan Finder found that many large insurers cut dental benefits and raised cost-sharing while mostly keeping primary-care costs unchanged. Clover Health, UnitedHealthcare, Humana and Centene stood out for putting margins ahead of growth.47 UnitedHealthcare's dental cuts reached almost 70% of its members. Humana reduced or eliminated Part B premium "givebacks" for about 62% of members, though it slightly increased dental allowances.3 Another analysis puts the average rise in maximum out-of-pocket limits at about 9%.1

The two accounts are not really in conflict. A falling premium average and a 9% higher out-of-pocket limit can both be true. The bill simply moves from the monthly premium to the point of care, so the people who use the most care pay the most. Paying more when you get care is the main way patients will feel these cuts in 2027.

Drug prices in Medicare: savings and new charges at once

The Part D drug benefit points in two directions. Negotiated prices for 15 more drugs take effect January 1. They include the semaglutide products Ozempic, Rybelsus and Wegovy, plus cancer drugs such as Xtandi, Ibrance and Calquence.1516 CMS estimates beneficiaries will save about $685 million in out-of-pocket costs.15 Discounts from 2024 list prices range from 38% to 85%.16

Other changes go the opposite way. The annual out-of-pocket cap rises from $2,100 to $2,400, and the standard deductible from $615 to $700.1315 The Part D Premium Stabilization Demonstration, a temporary subsidy created in 2024, ends after 2026.16 CMS says the average stand-alone plan premium will rise by less than $1, to $36 a month, and dismissed what it called "misleading reports" about the program ending.11

Independent reviews find bigger increases for some people. KFF's Juliette Cubanski said some stand-alone plans will rise by more than $50 a month, and a few by as much as $100.13 Consumers' Checkbook found a UnitedHealthcare AARP Part D plan in Fairfax County, Virginia, jumping about 207%, from $39.60 to $121.90.18 About 4 million stand-alone Part D enrollees who paid nothing in 2026 will lose their $0 option, though people who qualify for low-income subsidies can still get one.4 The average beneficiary will also have fewer stand-alone plans to pick from, nine instead of 11, the fourth straight annual decline.13

Newsweek did the math for retirees: a 3.6% Social Security cost-of-living raise, worth about $75 a month, could be wiped out by these cost increases.15

Employers face the steepest increase since 2003

Working-age people are seeing their own version of this. Marsh, formerly known as Mercer, surveyed more than 1,800 employers. They expect health benefit costs per employee to rise 8.2% in 2027 after planned cuts, and about 11% without them. That would be the largest increase since 2003.2226 The other major surveys land in the same range. Aon projects 9.5%. Business Group on Health puts the median at 9.2% before plan changes. PwC projects 9%, the highest in 17 years, and WTW projects 11.1% before cost controls.21

The drivers overlap with the Medicare story. They include expensive new treatments, especially cancer therapies; consolidation among hospitals and other providers; AI-assisted billing that produces more and higher-coded claims; and GLP-1 weight-loss drugs, which add about one percentage point by themselves.2223 Employers respond the way Medicare Advantage insurers do. About 59% plan cost-cutting changes such as higher deductibles, and about two-thirds of large employers expect to raise workers' share of premiums.22 Among large employers, coverage of GLP-1s for weight loss fell from 72% to 60% in a year.23 Insurers selling small-group plans have requested a median 14% increase.21

Across both markets, the payer protects its margin by narrowing networks and raising patients' share of costs. The patient pays more when they actually use care.

Medicaid changes land the same day

The Medicaid changes begin on January 1 as well. Under the 2025 reconciliation law, adults covered through Medicaid expansion must show 80 hours a month of work, school or volunteering, or about $580 in monthly earnings. Up to about 20 million people fall into that group.3133 Eligibility checks for expansion adults move from once a year to every six months. Retroactive coverage shrinks to one or two months, depending on the enrollee and the state.3137

Estimates of how many people will lose coverage vary widely. The Congressional Budget Office projected 7.5 million more uninsured people and about $911 billion less in federal Medicaid spending over a decade.35 One consumer guide reports that CMS expects about 2.3 million people to lose coverage in the first year.39 Researchers writing in the New England Journal of Medicine warn that up to 10 million could lose coverage.34 A CMS rule defined "medical frailty" more narrowly than states expected, which adds to the paperwork burden.35 Twenty-five states and the District of Columbia are suing over that definition.32

The effects reach hospitals and insured patients too. Clinicians warn that the work requirements will increase medical debt for patients and providers alike.31 Recent research finds hospitals are closing at the same rate in cities as in rural areas.31 Patients who lose coverage do not stop needing care, and the cost of treating uninsured people gets shifted onto the insured, which already shows up in private premium projections.24

The takeaway

The 990,000 cancelled plans should not be read as a sign that Medicare Advantage is collapsing. Choice remains broad, and CMS's premium figures are accurate as averages. The bigger change is in what coverage is worth. Medicare plans, employer plans and Medicaid are all, in different ways, giving patients less coverage while expecting them to pay more of their own care. For affected seniors, the practical advice is to compare total annual costs, check doctor networks and drug formularies before December 7, and not to assume that a replacement plan from the same insurer offers the same coverage.213