2027 Medicare Advantage Exits and the Financial Pressures Behind Them

Farzin Espahani

Strategic Advisor, Insurance Growth, Medicare Distribution, and Compliance

Published October 20, 2026

A Medicare Advantage plan closes, and the work immediately moves to someone else. A beneficiary has to check whether a new plan covers the same doctors and prescriptions. A physician's office has to verify eligibility and revisit authorizations. A hospital's billing team has to collect outstanding claims while preparing for different contracts.

Behind that disruption is a financial decision: the organization offering the plan has decided that continuing is no longer its preferred use of capital, resources, or management attention.

Eighteen payers appear on Becker's list of Medicare Advantage departures for 2027. Several have substantial documented losses. Others are restructuring their products, leaving a particular market, or withdrawing from insurance more broadly. One faced a major disruption involving its administrative vendor. Some reported positive overall income before choosing to leave.

These differences matter to anyone trying to understand what healthcare growth can reasonably deliver. Enrollment creates revenue, but it also creates obligations. A sustainable plan needs reimbursement that reflects the population it serves, dependable claims and service operations, sufficient capital, and a provider network capable of delivering care within the available resources. The 2027 departures show what happens when those requirements become difficult to reconcile.

What the 18 exits actually include

The headline counts organizations and brands at different levels. Blue Cross and Blue Shield of Texas, Oklahoma, and Montana belong to Health Care Service Corporation (HCSC). HCSC is retaining HealthSpring Medicare Advantage coverage in parts of Texas and Oklahoma while leaving Montana's Medicare Advantage market. Sharp is leaving individual Medicare Advantage while retaining employer group coverage.

That makes the list useful as a record of market disruption, but unsuitable as a count of 18 independent corporate failures. The table below summarizes the departing footprints. County counts describe where the payer offered plans in 2026, they do not measure enrollment or the number of counties losing all Medicare Advantage options.

A plan termination also needs to be distinguished from a consolidation into another plan. CMS landscape files describe offerings, while plan crosswalks identify how plans change between years. Those records establish availability and transitions. They do not explain a company's financial reasoning.

Where the financial evidence is strongest

Several departures can be examined using financial information for the actual insurance entity or Medicare Advantage product. Those cases provide a firmer basis for analysis than the financial results of a hospital system or diversified parent.

CHRISTUS: medical expenses exceeded Medicare Advantage revenue

CHRISTUS Health Plan's 2025 Texas regulatory supplement separates Medicare Advantage from its other business. Its Medicare Advantage medical and hospital expenses exceeded revenue before claims administration and other administrative costs, resulting in a substantial loss for the product.

The financial pressure continued into the first six months of 2026. From January through June, CHRISTUS Health Plan reported $71.80 million in Medicare Advantage medical and hospital expenses against $62.34 million in revenue, producing a medical loss ratio of 115.2%. That means approximately $115.20 went toward medical care for every $100 in revenue, before claims administration and other administrative costs. Including those expenses, the Medicare Advantage business reported an $18.61 million net loss for the six-month period. These results document continued losses ahead of the planned withdrawal, although they do not establish every factor behind the decision.

CarePartners: repeated owner funding

CarePartners of Connecticut illustrates the cumulative cost of keeping a regional plan operating. The Connecticut Insurance Department's examination reports approximately $93.00 million in revenue and a $14.46 million net loss in 2024. Across 2021 through 2024, cumulative net losses reached $67.64 million, while paid-in surplus adjustments totaled $82.26 million.

Those contributions supported the balance sheet. They did not make the insurance business profitable. The same examination records a clear timeline: CarePartners explored an exit in 2025 and formally notified the regulator in March 2026 that it would sunset its plans effective January 1, 2027.

For an owner, each additional year requires a judgment about whether another capital commitment has a credible path to producing sustainable results. The historical figures show why that question would become difficult. The regulator also reported no material concerns affecting the company's ability to manage reserving and pricing risks within the scope reviewed, a loss-making insurer should not automatically be described as noncompliant or improperly managed.

Wellmark: losses concentrated in the Advantage entity

Iowa's regulatory report records a $76.83 million net loss for Wellmark Advantage Health Plan in 2024. Beginning capital and surplus were $33.89 million, the loss was more than twice the entity's beginning surplus. Miscellaneous surplus changes of $98.62 million helped bring year-end surplus to $54.27 million. These figures belong to Wellmark Advantage Health Plan specifically; using the results of Wellmark's broader commercial insurance organization would obscure the performance of the departing Medicare business.

Positive income can conceal weak recurring economics

Memorial Hermann's filing demonstrates why a bottom-line figure needs to be read alongside its components. For the first nine months of 2025, its Medicare insurance entity reported $3.50 million in net income. It also reported medical spending consuming 97.3% of premium revenue and a $15.01 million reduction in accident and health contract reserves.

The reserve reduction lowered reported expenses. Calculated without that movement, underwriting income would have been approximately negative $9.97 million. This calculation isolates the reserve effect; it is not a restatement of the filed accounts or proof that the reserve adjustment was inappropriate.

Management's closure notice cites competition, regulatory uncertainty, compliance burdens, financial discipline, and concentrating resources on care delivery. A health system can reasonably conclude that supporting its insurance operation offers less value than investing the same resources in clinical services and access. For finance teams, the lesson is to distinguish recurring performance from reserve movements, investment returns, and owner contributions.

Braven Health: persistent losses and additional capital

Braven Health reported net losses every year from 2021 through 2025, increasing from $38.0 million to $177.3 million over that period. According to NJBallot's reporting based on regulatory filings, its 2025 revenue was $814.1 million, medical costs were 113.1% of premiums, and it received $216.1 million in new capital during the year.

That history is consistent with a business requiring substantial continuing support. Enrollment growth can magnify a weak relationship between revenue and cost as readily as a strong one. The financial pattern helps explain the withdrawal, although it should not be represented as a complete statement of management's reasoning.

HCSC: changing where and how it competes

HCSC's three entries should be examined as parts of one portfolio decision. Its 2025 annual report shows revenue of $66.76 billion, an underwriting loss of $3.48 billion, and a net loss of $1.92 billion, covering the company's reported business, not Medicare Advantage in Texas, Oklahoma, or Montana separately.

Management's explanation is more specific: HCSC assessed provider partnerships, network adequacy, local membership, product requirements, utilization, and medical cost trends relative to CMS reimbursement. It is concentrating more heavily on HealthSpring HMO plans while expanding Blue-branded Medicare Advantage across New Mexico. A large footprint can create revenue opportunities and additional complexity at the same time. A county with limited enrollment still requires appropriate networks, member support, reporting, and administration. HCSC's actions suggest a preference for markets and products where those requirements can be supported more consistently.

Some exits have a different documented trigger

Molina: concentrating on dual eligible members

Molina's SEC filing states that its traditional Medicare Advantage prescription drug product no longer aligns with its strategy of focusing on dual eligible members, those who qualify for both Medicare and Medicaid. Its July 2026 guidance included a $1.00 per diluted share loss associated with traditional Medicare Advantage prescription drug performance. The evidence supports a financial and strategic withdrawal. It does not establish that dual eligible special needs plans are automatically more profitable or easier to administer; their viability still depends on contracts, coordination, population needs, and execution.

Aspirus: exposed to its administrator's failure

CMS's February 24, 2026 sanction followed a Wisconsin order restricting new and renewal business involving Aspirus's third-party administrator. The affected functions included customer service, care management, and claims processing. The administrator's parent had entered rehabilitation, recording a $504 million operating loss in 2024. The operational exposure is clear: outsourcing a function does not remove the plan's responsibility to perform it. A vendor's financial distress can become the plan's member service problem, provider payment problem, and regulatory problem. The public record establishes that disruption, it does not establish Aspirus's own Medicare Advantage underwriting loss.

Providence: could not preserve the business through a transaction

Providence Health Plan reported a $102 million net loss on $2.5 billion in revenue in 2025. Its chief executive cited higher medical and pharmacy utilization and an earlier decline in Medicare Advantage star performance. The plan subsequently recovered four-star performance for 2026 and 2027 revenue. Providence explored strategic alternatives, but a transaction intended to preserve the Medicare business failed. Improvement in one measure did not resolve the overall ownership decision. Quality performance, capital allocation, administrative capability, and a viable transaction path each affected the available options.

Where the public financial record remains incomplete

Several remaining departures cannot responsibly be explained with a verified product-level loss. Saint Alphonsus reported $501,210 in positive income on $29.82 million revenue in 2024. WellSense's broader health plan reported $7.23 million positive income on $5.805 billion revenue in fiscal 2025, with no isolated New Hampshire Medicare Advantage result. Sharp reported $38.42 million positive income on $1.199 billion revenue in fiscal 2025, with employer group plans continuing. Patrius Health and Mass Advantage cite rising costs and regulatory uncertainty without a verified standalone loss amount.

Assigning a financial loss to these departures without the supporting evidence would misrepresent the record. The exits are real; the specific financial cause is not always established in public filings.

The payment environment is not a uniform explanation

CMS finalized an expected average Medicare Advantage payment increase of 2.48% for 2027, or 4.98% including estimated risk-score trend. These are national averages, not guaranteed revenue increases for every plan. Calling the 2027 environment a uniform payment cut would be misleading.

The relevant question is how a particular plan's expected revenue compares with its actual medical costs and the expense of delivering the promised coverage. Higher revenue can coexist with worsening margins when costs rise faster. Consider a simplified illustration:

The practical requirement is earlier visibility into the changing relationship between revenue and cost. Enrollment growth can magnify a weak relationship as readily as a strong one.

Health system ownership creates opportunities and tradeoffs

Owning a provider network can support coordination, access, and closer clinical relationships. It does not eliminate the need to price insurance accurately, process claims reliably, or maintain sufficient capital. It also creates a difficult internal measurement problem: the hospital records revenue for care delivered, while the insurance operation records the cost of that care. Leaders need visibility into the combined economics and the contribution of each business.

Without that view, a system can mistake activity for improvement. More insured members may produce more visits and premium revenue while increasing the amount of capital needed to support the insurance entity. A useful review therefore needs to connect member needs, medical spending, provider payments, administrative costs, reserves, and capital commitments.

What payers and providers should change

Make financial deterioration visible before the annual bid decision

Payers should review product and market performance frequently enough to detect changes while they can still act. The review needs to distinguish current claims experience, claims not yet received, reserve changes, investment income, and owner support. Responsibility should be clear when medical trends diverge from pricing assumptions. Finance, actuarial, clinical, network, and service leaders need a shared view of the problem and an agreed response.

Useful measures include recurring underwriting contribution, forecast error, administrative cost per member, capital required to sustain the business, and the time between detecting deterioration and acting on it.

Treat claims and service administration as financial controls

Aspirus's experience makes vendor resilience a concrete issue. Plans need to understand whether essential administrators can continue operating through financial stress, ownership changes, or technology disruption. Providers also need dependable records for claims submission, appeals, authorizations, and payment reconciliation during a plan's run-out period. Better visibility and tighter workflows can reduce avoidable leakage and delay, they cannot make an inadequately funded product economically sound, but they can prevent administrative failures from making the position worse.

Give patient transitions an accountable owner

The immediate task is to identify affected patients, verify replacement coverage, and protect ongoing care. A transition process should record whether the patient's physicians, hospital, pharmacy, and prescriptions have been checked. It should flag active oncology treatment, scheduled procedures, recent discharges, and authorizations extending into the new year. Memorial Hermann's closure guidance explicitly notes that an authorization does not extend coverage beyond the plan's termination. For brokers and agencies, the measure of success should include a completed coverage review and a documented handoff. For providers, it should include verified eligibility, continuity work, and timely resolution of outstanding claims.

The decision leaders need to make

The financial record supports several difficult exit decisions. It also shows why the same explanation cannot be applied to every payer. CHRISTUS had medical spending above Medicare revenue. CarePartners accumulated losses and required repeated owner funding. Wellmark's Advantage entity recorded a substantial loss. HCSC reshaped its portfolio. Aspirus encountered a critical administrative dependency. Providence's attempted transaction did not preserve the insurance business.

For organizations remaining in the market, the next step is to review each product's recurring economics alongside its ability to serve members reliably. Any decision to grow, repair, sell, or close should identify the capital required, the accountable owner, the measurable improvement expected, and the plan for protecting continuity of care.