FirstCarolinaCare, a not-for-profit insurance company jointly owned by FirstHealth of the Carolinas and Illinois-based Carle Health, has announced it will discontinue all lines of business, including Medicare Advantage, by December 31, 2025, affecting approximately 5,800 Medicare beneficiaries in Moore County and the surrounding North Carolina region.
The decision ends FirstCarolinaCare’s Medicare Advantage operations offered under the FirstMedicare Direct banner.
Here’s what you need to know.
What’s Happening
FirstCarolinaCare will completely exit the insurance market by the end of 2025. The Southern Pines-based insurer serves approximately 19,000 total members in Moore County and surrounding areas, with 5,800 enrolled in FirstMedicare Direct Medicare Advantage plans.
Coverage for current Medicare Advantage members remains unchanged through December 31, 2025. Members will need to select new coverage during Medicare’s Annual Enrollment Period (AEP), which runs from October 15th to December 7th.
According to company officials, approximately 5,800 Medicare Advantage plan members will be affected by this exit.
Why It Matters
FirstCarolinaCare’s complete market exit highlights the challenges facing provider-owned health plans in today’s insurance landscape, particularly in communities where nearly a quarter of the population is over 65. The company joins a growing list of insurers exiting Medicare Advantage, including UnitedHealthcare, Humana, Health Alliance, Sentara Health Plans, and UCare.
The announcement follows a similar decision by Carle Health, FirstCarolinaCare’s parent company and partner Health Alliance. The decision to discontinue all lines of business, including Medicare Advantage, came after a “comprehensive strategic and financial analysis.”
The decision reflects several industry-wide challenges:
- Market dynamics and plan designs make it increasingly difficult for provider-owned health plans to remain sustainable
- Insurance costs outstripping companies’ ability to generate profit
- Intense competition from larger health systems like Kaiser Permanente and Aetna
- Same-market Medicare Advantage enrollment trailing off despite overall market growth
“Our decision to exit the insurance market comes at a time when market dynamics and plan designs have made it increasingly difficult for provider-owned health plans to remain sustainable,” said Dr. James C. Leonard, Carle Health president and CEO. “We’re proud of the service our health plans have delivered for decades, and especially proud to have connected people to the care they’ve trusted through every stage of life.”
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.
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