UCare’s Medicare Advantage Exit 2026: What It Means
UCare, one of Minnesota’s largest nonprofit health insurers, has announced it will terminate all Medicare Advantage (MA) plans at the end of 2025. This decision will affect an estimated 158,000 seniors across Minnesota who currently rely on UCare for their Medicare Advantage coverage.
Members will continue to be covered through December 31, 2025, but must select new coverage during the Annual Enrollment Period (AEP) in fall 2025 to avoid losing benefits.
UCare explained that the exit is driven by severe financial strain, including rising utilization costs and federal reimbursement rates that have not kept pace with expenses. To stabilize its operations, the company is also laying off nearly 9% of its workforce.
For beneficiaries who trusted UCare to provide affordable premiums, predictable out-of-pocket costs, and stable provider access, this abrupt decision raises significant concerns about future healthcare costs, continuity of care, and overall coverage stability.
Why This Matters for Beneficiaries
UCare’s departure from the Medicare Advantage market has serious implications for the seniors who depend on its plans – and the ripple effects may extend across Minnesota’s healthcare landscape.
Out-of-pocket costs will rise. UCare built a reputation for offering plans with low copays, bundled prescription drug coverage, and affordable premiums. Replacing those benefits could mean higher deductibles, steeper copays, or more expensive drug coverage with another insurer.
Continuity of care is at risk. Changing carriers doesn’t just mean switching ID cards – it can disrupt relationships with long-standing doctors, specialists, and pharmacies. Members may find that their preferred providers are no longer in-network, or that prescription costs increase under a new plan.
Market stability is in question. UCare has long been viewed as a stable, nonprofit option rooted in Minnesota communities. Its decision to exit raises broader concerns: if a well-established local nonprofit cannot sustain Medicare Advantage, what does that say about the long-term viability of the program? Seniors across the state may be left wondering whether their next chosen plan will be just as vulnerable to financial pressures.
What I Recommend
In my 15+ years helping people with Medicare in Minnesota, I’ve watched too many miss their chance when they had a Guaranteed Issue (GI) window and later regret it. Once that window closes, getting into a Medigap (Medicare Supplement) plan – especially with pre-existing conditions – can become very difficult or more expensive.
What makes UCare’s exit more than a disruption is that it gives Minnesota residents an opportunity: a chance to replace a Medicare Advantage (MAPD) plan with Original Medicare + Medigap under GI rights.
Yes, Medigap plans in MN often come with higher monthly premiums than many MAPDs, but in return, you get more predictability, stability, and freedom – no networks to worry about, no surprise copays, and much less risk of a carrier dropping your plan or pulling out of the market.
What I Recommend (Step-by-Step) for Minnesotans Considering Medigap vs. MAPD
| Step | What to Do (MN-Relevant) | Why It’s Important |
|---|---|---|
| 1. Gather current plan details | Get all your UCare / current MAPD plan information: monthly premium, copays, deductibles, drug formulary, and network providers. | You need to compare apples to apples. What you have now becomes your baseline for comparing MAPD vs. Medigap. |
| 2. Review other MAPD options | During AEP, see what other MAPD plans are available in your county in MN, what providers they include, and how drug coverage looks. | Because some MA plans in Minnesota may offer good benefits, but might also have restrictive networks or high cost-sharing. |
| 3. Explore Minnesota’s Medigap options under GI rights | Look into the Basic and Extended Basic Medigap policies, plus Minnesota’s version of Plan N (called “Medigap with copayments”) which are available in Minnesota. MN also offers optional riders (add-ons) to Medigap Basic to cover extra benefits. | These plans are the ones actually available in Minnesota; you want to choose what’s real for your state. GI rights mean you can get into one without health underwriting when your MAPD plan ends. |
| 4. Double-check providers and prescriptions | Make sure your current doctors/hospitals accept Medicare (Original Medicare) and that any crucial prescriptions will be coverable with a standalone Part D plan. | Because Medigap works with Original Medicare, provider choice is broader – but prescriptions are separate via Part D, which means you’ll want to see what drug plans cost and what coverage is like. |
| 5. Use available transition help | UCare and state agencies in Minnesota typically provide tools or counseling to help through the switch. Also, check with your local SHIP (State Health Insurance Assistance Program) or brokers. | Helps avoid missteps; you want enough support, especially around deadlines and paperwork. |
| 6. Look at total costs, not just premiums | When comparing Medigap vs MAPD, add up everything: premiums + deductibles + copays + out-of-pocket maximums + drug costs (if MAPD) or separate Part D premium (if you go with Medigap). | MAPDs can look cheaper monthly but cost more in indirect ways; Medigap may cost more upfront but often protects better against volatility. |
What Medigap Looks Like in Minnesota (so Your Options Are Real)
Here are some key facts specific to Minnesota to help you evaluate:
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Minnesota does not use the same “lettered” Medigap system in all cases. Instead, there are the Basic Plan and the Extended Basic Plan, plus Medigap with Copayments (Plan N-type).
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Additional “riders” (add-ons) can be purchased with the Basic plan to cover things like foreign travel emergency, “usual and customary fees,” preventive care beyond what Original Medicare offers, etc.
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Minnesota Medigap premiums are community-rated, not age-attained. That means your premium doesn’t increase just because you get older (with the same insurer and same plan) – unlike many states.
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You must have Medicare Parts A and B to enroll in a Medigap plan. Also, Medigap policies in MN are guaranteed renewable.
The Silver Lining: Guaranteed Issue (GI) for Medigap
Here’s something many Medicare members don’t realize: when a Medicare Advantage (MA) plan ends, federal law grants you Guaranteed Issue (GI) rights to buy a Medicare Supplement (Medigap) plan.
What Guaranteed Issue Rights Mean
Normally, suppose you apply for a Medigap policy outside of your initial enrollment period. In that case, the insurer can require medical underwriting – meaning they can deny you coverage or charge higher premiums based on your health.
But if your Medicare Advantage plan is terminated by the insurer, you are protected. You get a 63-day GI window to enroll in a Medigap plan, and insurers must accept your application with no health questions asked.
Why It Matters Now
- A second chance – Seniors who were previously denied Medigap coverage because of health conditions now have another opportunity.
- Stable, predictable coverage – Medigap plans like Plan G and Plan N fill in Medicare’s coverage gaps, are accepted nationwide, and don’t restrict you to provider networks.
Future-proofing your coverage – Moving to Medigap helps shield you from the cycle of Medicare Advantage plan changes, shrinking networks, or outright plan exits.
The Bigger Picture: Lessons from 2024 AEP
UCare’s exit is not an isolated event. The turbulence surrounding Medicare Advantage has been building for years, and it became especially clear during the 2024 Annual Enrollment Period (AEP). Several major insurers made significant changes to their offerings:
- Aetna projected losing up to 10% of its MA membership by pulling out of unprofitable plans.
- Humana cut plans and exited certain markets, displacing hundreds of thousands of members.
- Cigna reduced its footprint by exiting select markets where costs outweighed federal reimbursement.
- Even UnitedHealthcare, the largest MA insurer in the country, scaled back in certain counties to shore up profitability.
The pattern is unmistakable: carriers are choosing financial sustainability over aggressive growth. If a plan or a market doesn’t make financial sense, insurers are trimming or eliminating it.
How This Relates to UCare
UCare’s decision represents a more extreme version of the same industry trend. The root causes are no different:
- Rising medical and drug costs are outpacing revenue.
- Federal reimbursements lag behind actual healthcare spending.
- Competitive pressures make it difficult to maintain low premiums without operating at a loss.
The result is a Medicare Advantage landscape with fewer choices, shrinking provider networks, and greater instability for beneficiaries. UCare’s withdrawal highlights just how fragile the balance has become – if even a well-established nonprofit rooted in Minnesota cannot sustain its Medicare Advantage book, seniors everywhere should take note of the risks built into the system.
Why Medigap Stands Out
UCare’s departure is a reminder of why many seniors prefer the stability of Medicare Supplement (Medigap) plans. Unlike Medicare Advantage, Medigap plans don’t change their core benefits from year to year. Once enrolled, you can count on the same coverage no matter what happens in the marketplace.
Stability. Medigap plans aren’t tied to annual insurer decisions or shifting government reimbursements. Your benefits remain consistent over time.
Freedom. With Medigap, you can see any provider nationwide who accepts Medicare – no network restrictions, referrals, or county-based limitations.
Predictability. While monthly premiums are often higher than many MA plans, Medigap eliminates the surprise copays, coinsurance, and network disruptions that Medicare Advantage members frequently face.
For UCare members, the upcoming Guaranteed Issue window makes this the perfect opportunity to lock in Medigap coverage. It’s a rare chance to step away from the uncertainty of Medicare Advantage and secure long-term peace of mind.
What Plans We Recommend Looking At
Minnesota is one of three states (along with Massachusetts and Wisconsin) that standardize Medigap plans differently from the rest of the country. Instead of Plans A–N, Minnesota offers a Basic Plan that can be customized with riders, as well as a High-Deductible Plan F. However, these options closely mirror the benefits of Plans G, N, and High-Deductible G, which are available in most other states.
Minnesota Basic Plan with Riders – Comprehensive Protection
The Minnesota Basic Plan covers core benefits like hospital costs, Part B coinsurance, blood, and hospice. With riders, you can add coverage that makes it very similar to Plan G in other states. That means you’d only be responsible for the Part B deductible, with nearly everything else covered.
Who it’s good for: Seniors who want maximum protection and predictability, especially those with frequent doctor visits, specialists, or travel needs.
Why it’s better than Advantage: No networks, referrals, or surprise copays. You can see any provider nationwide who accepts Medicare, with stable, predictable costs.
Minnesota Basic Plan with Select Riders – Balanced Coverage
If you choose fewer riders, the Basic Plan can function similarly to Plan N. You’ll enjoy lower monthly premiums in exchange for modest copays and fewer covered extras. Part B excess charges are also not covered, just like Plan N.
Who it’s good for: Beneficiaries who are healthy overall, want to keep premiums lower, and don’t mind occasional copays when receiving care.
Why it’s better than Advantage: Even with some cost-sharing, this setup avoids Advantage plan networks and annual changes, offering simpler long-term budgeting.
High-Deductible Plan F – Budget-Friendly Option
Minnesota still offers High-Deductible Plan F, which works much like High-Deductible Plan G in other states. You must meet a higher deductible before benefits apply, but premiums are much lower.
Who it’s good for: Healthier seniors who rarely need care and prefer the lowest premiums while still having protection from catastrophic costs.
Why it’s better than Advantage: You keep the nationwide provider freedom of Original Medicare, avoid yearly plan disruptions, and never worry about changing networks.
The Bottom Line
Whether you choose the Minnesota Basic Plan with riders, a leaner rider setup, or High-Deductible Plan F, you’ll find options that mirror the Basic Plan with Riders, Basic Plan with Select Riders, and HDF. Each provides greater stability, freedom, and predictability compared to Medicare Advantage, which is why they’re excellent choices during Minnesota’s guaranteed issue window.
My Final Word
UCare’s exit from Medicare Advantage is disruptive, but it also creates a rare opportunity: Guaranteed Issue rights for Medigap. For many members, this may be the best – and possibly only – chance to switch into a Medicare Supplement plan without medical underwriting.
If you’ve ever considered Medigap, now is the time. Missing this window could mean losing your best opportunity to secure comprehensive coverage for life. By enrolling in a Medigap plan, you gain:
- Protection from network instability.
- Nationwide access to any provider who accepts Medicare.
- A shield against surprise out-of-pocket costs.
- Long-term peace of mind and predictability.
FAQ's
- What happens to my UCare Medicare Advantage plan?
- What are Guaranteed Issue (GI) rights?
- How long do I have Guaranteed Issue rights?
- Should I choose Medicare Advantage or Medigap after UCare exits?
- What steps should I take right now?
