Medicare Advantage Plans Continue Market Overhauls In 2026
Financial and operational pressures continue to force Medicare Advantage (MA) carriers to recalibrate their market strategies. Our review of 2026 plan preview data shows that insurers are again closing plans or fully exiting certain geographies, a trend that we identified last year. The analysis also found that there are fewer standalone prescription drug plan (PDP) offerings, suggesting there could be further consolidation in that segment. At the same time, there’s been targeted growth in Special Needs Plans (SNP), highlighting a deliberate shift toward high-need populations with greater care and network needs.
The financial headwinds facing insurers are stiff. MA plans in 2024 collectively experienced a $5.7 billion underwriting loss, with nearly three-quarters of companies heavily focused in the market reporting losses. It’s important to note that plans submitted their 2026 product designs in June 2025, meaning the 2024 results were looming large as strategies were set for 2026. The annual enrollment period for 2026 runs from October 15 to December 7.
At the time of publishing, the Centers for Medicare and Medicaid Services (CMS) had not released plan crosswalk details. As a result, this article explores relative plan counts. The full impact of plan changes for members like actual plan closures versus members cross-walked into new products is not yet available and will be explored in future articles.
MA and MAPD markets shrink
Fewer plan offerings and county exits: For calendar year 2026 (CY26), many carriers cut back available products and reduced service areas and benefit richness. Overall, the total number of non-SNP MA-only and Medicare Advantage prescription drug plans (MAPD) nationally declined 10%, from 3,719 plans in 2025 to 3,373 plans in 2026. This will result in many members being forced to shop for a new plan rather than having the option of staying with their current plan.
Several national carriers, including CVS Aetna, Elevance, Humana, and UnitedHealthcare, each are scaling back plan offerings in at least 100 counties this year compared to 2025. UHC, for example, offered MA-only and MA-PD plans in 2,808 counties in 2025, but will have a presence in 2,597 counties in 2026.
PPOs saw more exits and plan closures than HMOs — a 12% year-over-year decline compared to 8%. Additionally, of the 163 MA-PD PPO plan reductions, more than 50% were $0 PPO plans. This is not enrollment weighted; we expect more membership in $0 / low premium PPO plans that were closed. For plans that remained, the average premium for non $0 MA-PD plans increased from $60 in 2025 to $66 in 2026.
Carrier decisions to close or consolidate PPO offerings are likely driven by the insurers’ limited ability to control cost and quality effectively given wider networks, increasing financial risk, and operational complexity. In contrast, HMOs with tighter networks offer better cost predictability and management.
Shrinking plan choices for beneficiaries: One of the most tangible impacts of these exits is a reduction in the average number of Medicare Advantage plan options available to individuals at the county level.
Beneficiaries in 2025 typically had access to an average of 42 plans per county, including non-SNP MA and MA-PD. That will fall to 39 plans per county in 2026. While three plans per county may not sound dire, this difference can be more extreme in select counties. For example, Medicare beneficiaries in Fresno County, Calif., will have 18 plan choices in 2026 compared to 28 plan choices last year.
Limited consumer choice could drive disenrollment or dissatisfaction, particularly among beneficiaries who value network breadth or specific supplemental benefits. It’s critical that insurers prioritize investing in member experience, retention, and engagement since those will be key in driving member loyalty and managing satisfaction and quality scores.
Standalone Prescription drug plan offerings drop, too
The total number of PDP plan offerings will decrease modestly in 2026, with Elevance marking the only major exit and no new entrants into the standalone PDP market. This market remains concentrated with the vast majority of plan offerings and membership residing in nationwide carriers and Health Care Services Corp (HCSC), the parent company of five regional Blue Cross Blue Shield Plans. Premium changes for 2026 ranged from a $94 reduction to some plans hitting the $50 premium increase cap instituted by a CMS demonstration project.
Since at least one standalone PDP option with a premium under $20 exists in almost every region, we don’t expect a migration from PDP to MAPD based solely on this year’s premium changes. Changes to Medicare Supplement premiums, formularies, and drug benefits would be necessary to trigger such a shift.
Premium reductions were largely exhibited in the benchmark PDP plans targeting the low-income subsidy (LIS) population. There were likely two key drivers here: 2024 and emerging 2025 drug utilization trend for the LIS population was much lower than for the non-low income (NLI) population, and the 2026 Part D risk adjustment model is more favorable for LIS members relative to NLI.
Centene and Humana will be the recipients of the majority of the LIS auto-enrollment for 2026, which is triggered by filing a basic product at or below the LIS benchmark in a given region. CVS Aetna, UHC, and to a lesser extent, HCSC, largely filed above the LIS benchmark in most regions on their basic PDP products, meaning they will forego LIS auto-enrollment in those regions for 2026.
The NLI PDP offerings faced more premium pressure than the LIS PDP plans for the reasons outlined above. Many plans filed the full $50 premium increase allowed under the PDP demonstration program, including the legacy Cigna products, CVS Aetna, and some regional carriers. This pressure was not seen market wide with other PDP carriers like Centene and Humana maintaining premiums at or below 2025 levels in many markets, including some $0 premium products. The NLI PDP market will see premiums ranging from $0 to more than $100 in most states, resulting in another year of significant shopping for this population.
Growing focus on D-SNP and C-SNP plans
There was a bright spot in the data: growth in SNPs, particularly chronic condition SNPs (C-SNPs) and dual-eligible SNPs (D-SNPs), which covered 1.2 million and 6.5 million enrollees respectively in 2025. This expansion reflects carriers’ strategic focus on high-need populations where care coordination and specialized benefits can improve outcomes and potentially reduce costs.
C-SNP plans grew by 172 and now total 548, targeting such conditions as congestive heart failure, cardiovascular disorders, and diabetes. The aim of these plans is to provide tailored care management and supplemental support. Fourteen carriers are increasing their county footprint in the C-SNP market with Devoted Health making the largest push into new markets by expanding into 965 new counties.
Similarly, D-SNP plans increased by 119, with a total of 1,019 now available. These focus on integrated Medicare and Medicaid benefits for dual-eligible beneficiaries
Investment in SNPs signals a more targeted approach that some plans are taking to focus on supporting populations with complex care needs. Carriers that are able to effectively manage costs of these populations, primarily through differentiated medical management, member engagement capabilities, and value-based provider relationships may be able to offset financial challenges occurring in the general MA market.
Planning for the future as markets keep shifting
The ongoing market shakeup, marked by shrinking plan options and the disproportionate exit of PPOs, signals a continued shift in Medicare Advantage dynamics as plans act to either reduce membership or reduce the cost of providing benefits to the members they retain.
CMS recently announced a decrease in total nationwide MA enrollment for 2026, a calculation based on summing each carrier’s individual bid projections. However, we expect that many members impacted by closed plans are more likely to shop for a new plan rather than leave MA altogether given the benefits of staying in MA versus general Medicare and Medicare supplemental options.
Carriers must be prepared for a scenario where they underestimated their plans’ enrollment for 2026. To mitigate potential risk of higher enrollment than forecast, many plans are actively revisiting their broker commissions strategy, with more carriers announcing reduced commissions for part or all of their plans. This will be a key item to monitor in AEP and throughout 2026 as plans that reduce or remove commissions are signaling a desire not to grow those particular plans.
Carriers are making tough choices balancing profitability with coverage continuity. They must manage these strategies to avoid reputational damage and loss of trust. Future articles in this series will explore additional details on the shifting market dynamics including key benefit changes across MA and PDP, the impact of plan exits and entry on membership, and considerations for plans prioritizing growth in C-SNP and D-SNPs.
Phil Furrer, Julie Raiff, and Charles Rendleman contributed to this article.