Major Medicare Update…
UCare, one of Minnesota’s largest nonprofit health insurers, has announced it will no longer offer Medicare Advantage (MA) plans in 2026, impacting 158,000 members.
While Medica has announced it will acquire UCare’s Medicaid and Individual business, they are NOT taking over UCare’s Medicare Advantage plans.
Here’s what you need to know.
Is UCare Going Away?
In a drastic move on December 9, 2025, the Minnesota Department of Health filed a court petition to place UCare into rehabilitation status. This status gives state regulators control over the nonprofit as it winds down operations.
The court filing revealed a dire financial situation: UCare projects a cash flow deficit of $372.9 million by the end of the first quarter of 2026. This follows an over $500 million operating loss reported in 2024.
Impact on Workforce:
- Total Job Losses: Approximately 700 employees are at risk as the company shuts down.
- Immediate Cuts: Roughly 250 employees are scheduled for layoff in early January 2025.
Which UCare Plans Are Ending?
Unlike earlier projections, recent updates confirm that ALL UCare Medicare-branded products are terminating on December 31, 2025:
- Medicare Advantage: All individual and group plans, including UCare Prime, UCare Complete, and EssentiaCare.
- Medicare Supplement (Medigap): In a late-breaking update, UCare confirmed it will discontinue all Medigap plans.
- Integrated Special Needs Plans (SNPs): Both MSHO (Minnesota Senior Health Options) and Connect + Medicare plans are ending.
What UCare Will Continue Offering
While UCare is winding down, its Medicaid and Individual/Family lines are transitioning to Medica to ensure continuity for non-Medicare members. For the 2026 plan year, these plans will still have “UCare” in the name but will be managed under the Medica agreement. These include:
- Prepaid Medical Assistance Program (PMAP)
- MinnesotaCare
- Individual and Family plans through MNsure
Why It Matters
UCare’s exit is significant because it is the second-largest MA provider in Minnesota, behind Blue Cross and Blue Shield of Minnesota.
The company reported more than $500 million in operating losses in 2024, driven by:
- Rising medical costs and higher-than-expected use of health services
- Payment rates that insurers say are insufficient to cover expenses
“This decision was not made lightly,” said UCare President and CEO Hilary Marden-Resnik. “UCare remains deeply committed to the health of Minnesotans and to supporting members through upcoming transitions.”
What Are Medicare Advantage Plans?
Medicare Advantage (also called Medicare Part C) plans are an alternative to Original Medicare, offered by private insurers approved by Medicare. These plans often bundle:
- Hospital coverage (Part A)
- Medical coverage (Part B)
- Prescription drug coverage (Part D)
- Potential Additional benefits such as dental, vision, or hearing
With Medicare Advantage, your coverage is administered by a private insurer rather than directly through the government. These companies receive payments from Medicare to provide your benefits.
It’s important to know that most Medicare Advantage plans operate with networks of doctors and hospitals, and some may require referrals to see specialists. However, they can offer lower monthly premiums and additional benefits that Original Medicare doesn’t include.
Medicare Advantage has grown significantly in popularity, with over 32 million beneficiaries enrolled in 2024, making up roughly 54% of all Medicare participants.
Need Help With Medicare?
If you have any questions about this situation (or Medicare in general), our licensed insurance agents are here to help.
Simply call us at +1 877-360-6565 (TTY: 771) or click the button below to schedule an appointment.