When Hospitals Drop Medicare Advantage, Thousands Lose Their Coverage Too
Fred Neary had been a loyal patient at Baylor Scott & White Health for years, relying on its network of 52 hospitals across North and Central Texas for care. With five doctors, including some just minutes from his Dallas home, he felt secure in his healthcare routine. But in October, Neary’s Humana Medicare Advantage plan— a private alternative to traditional government-run Medicare— notified him that Baylor and Humana were embroiled in a contract dispute. If they couldn’t reach an agreement, Neary would have to choose between finding new doctors or switching insurance plans entirely.
“All my medical records are with Baylor Scott & White,” explained Neary, 87, a retired financial services professional. “My doctors are just five minutes away. After so many years, starting over with new doctors didn’t seem like an option.”
After weeks of uncertainty, Neary learned that Humana and Baylor would indeed be severing ties, leaving him with a tough decision to make. Fortunately, since this separation occurred during the Medicare Advantage open enrollment period, Neary had the opportunity to switch plans, securing coverage starting January 1—just a day after his current plan ended.
But not all Medicare Advantage enrollees are so fortunate. While provider disputes like this are common, most members are stuck with their plans for the year, even when key providers exit the network. Unless they qualify for a special enrollment period, switching plans or reverting to traditional Medicare typically isn’t allowed until the end of the year, with coverage beginning in January.
In the last 15 months, the Centers for Medicare & Medicaid Services (CMS), which oversees Medicare Advantage, has quietly granted special enrollment periods to hundreds of enrollees in at least 13 states, allowing them to switch plans or leave Advantage entirely without penalties. However, even when CMS grants the right to disenroll after losing a key provider, insurance companies may still enroll new members without informing them that their network has been reduced.
According to Becker’s Hospital Review, 41 hospital systems have left 62 Medicare Advantage plans across 25 states since July. Over the past two years, these withdrawals have tripled, according to FTI Consulting, a firm that tracks insurance disputes.
CMS spokeswoman Catherine Howden stated that network changes are “a routine occurrence” and that the agency has seen an uptick in cases where these changes trigger special enrollment periods. However, CMS has refused to disclose which plans allowed their members to disenroll after losing a major provider. The agency also did not clarify whether these plans were violating federal rules requiring Medicare Advantage networks to offer adequate providers within specific geographic areas.
Senator Ron Wyden of Oregon, a senior Democrat on the Senate Finance Committee, has expressed concerns about this lack of transparency. “Seniors enrolled in Medicare Advantage plans deserve to know they can change their plans when their local doctor or hospital drops out due to profit-driven business practices,” Wyden said.
The growing number of provider pullbacks is directly tied to Medicare Advantage’s increasing popularity. According to KFF Health News, nearly 54% of the 61.2 million people eligible for Medicare were enrolled in Medicare Advantage plans for 2024. These plans offer additional benefits not covered by traditional Medicare, thanks to extra payments from the government, which reimburse insurers about 20% more per member than traditional Medicare does.
While traditional Medicare offers nearly universal access to doctors and hospitals that accept Medicare, Medicare Advantage limits participants to a more specific network of providers, which can change throughout the year. Sanford Health, the largest nonprofit healthcare system in the U.S., withdrew from a Humana Medicare Advantage plan in 2014, affecting 15,000 people. “It’s not just about money or management issues, though those are real concerns,” said Sanford Health CFO Nick Olson. “The biggest issue is that delays and denials of coverage impact the care a patient receives, and that’s unacceptable.”
The National Association of Insurance Commissioners (NAIC), which represents state insurance regulators, has urged CMS to better protect Medicare Advantage members. “State regulators are seeing an increase in doctors and systems withdrawing from Medicare Advantage plans, leaving enrollees without sufficient access to care,” the NAIC wrote in a September letter. “CMS’s lack of action could lead to unnecessary financial and medical harm to seniors.”
State regulators have also lobbied for a nationwide special enrollment period for all Medicare Advantage members who lose access to a major provider, arguing that it should be easier for seniors to change plans without navigating complex regulations. This would include guaranteed access to Medigap insurance, which helps cover out-of-pocket costs for those switching to traditional Medicare.
Currently, only four states—Connecticut, Massachusetts, Maine, and New York—guarantee access to Medigap policies for individuals who want to switch to traditional Medicare. However, as more hospital systems, like Great Plains Health in Nebraska, withdraw from Medicare Advantage plans, insurance commissioners are pushing for greater flexibility. Great Plains Health had faced delays and denials that resulted in substandard care for its patients, prompting Nebraska’s insurance commissioner to request a special enrollment period for the 1,200 affected individuals.
In Delaware, when the Bayhealth system withdrew from a Cigna Advantage plan, CMS provided a special enrollment period for affected members starting in January. Similarly, when Northern Light Health in Maine exited a Humana Advantage plan, CMS ensured that members had the opportunity to switch plans.
In Minnesota, after several health systems announced they would be leaving Advantage plans in 2025, state officials asked CMS for help. Although some members were given a special enrollment period, others who lost access to providers were not, as CMS deemed they still had sufficient options within their plan’s network.
The growing number of provider withdrawals and the challenges they create for Medicare Advantage members underscore the importance of ensuring that seniors can easily access the care they need—without being trapped in insurance plans that no longer serve them well.