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Exchange Enrollment Down

About 23M have enrolled in Exchange coverage as open enrollment has all but closed out. That’s down about 5% from 2025 but more than the 21.3M in 2024. Interestingly, the reduction is not what many thought it would be after the expiration of the enhanced premium subsidies.

About 3.4 million are new enrollees, while 19.6 million are returning. About 15.8 million people enrolled on the federal Healthcare.gov platform, while 7.2 million enrolled on the state-based Exchanges.

Some states that stepped in with subsidies of their own saw strong growth, as did others who did not – such as Texas. Nine states had enrollment growth, while 41 saw declines.

For the 30 HealthCare.gov states, the data is through Jan. 15. For the 20 state-based exchanges plus D.C., the data is through Jan. 10. There are a few states that extended open enrollment and thus the enrollment numbers could rise. The big unknown is will rolls fall as people are required to make payments and do not do so after a grace period. Thus, 2026 could see more disenrollments.

In other news, talks to extend the enhanced subsidies in some form have ended and the GOP is preparing a last best offer to the bipartisan group. Discussions revolved around a possible two-year extension of the subsidies with subsidy income limits, minimum premiums, and expanded use of health savings accounts (HSAs).

Additional articles: https://www.healthcaredive.com/news/affordable-care-act-enrollment-2026-cms-snapshot-23-million/810790/ and https://www.beckerspayer.com/payer/aca/gop-senators-prep-best-and-final-offer-on-aca-subsidy-extension/ and https://thehill.com/policy/healthcare/5712648-obamacare-enrollment-drops-subisides-expiration/?tbref=hp and https://www.kff.org/quick-take/aca-signups-are-down-but-still-an-incomplete-picture/ and https://www.beckerspayer.com/payer/aca/aca-enrollment-falls-to-23-million-for-2026/

#healthcare #coverage #exchanges

https://www.fiercehealthcare.com/regulatory/about-23m-have-signed-aca-coverage-so-far-cms

Elevance Reports Caution, But Better News Than United

Elevance Health reported 2025 financial news today and its status is better than imploding UnitedHealth Group. That led to a recovery to some degree in its stock price today.

Elevance beat The Street on profit in Q4 2025 but missed on revenue. The company reported $547 million in profit for Q4, up from $418 million in Q4 2024. However, its $49.3 billion in Q4 revenue fell short. It did have almost 10% growth year over year.

For the full year, Elevance Health brought in $197.6 billion in revenue, up 12.8% from 2024’s $175.2 billion. Profits were down by 5.3% compared to 2024, decreasing from $6 billion to $5.7 billion.

Elevance did report that it will see declining revenue in 2026, though. And profit could be constrained as well. This is tied to shedding of membership to right the financial ship as well as governmental impacts in Medicaid and the Exchanges. The insurer also had elevated utilization and medical costs, with a medical loss ratio of 93.5% in Q4.

Its small but growing Carelon services unit had a good year, with operating revenues of $18.7 billion in Q4 2025, up 27% year over year.

Elevance expects to make a return to 12% growth in earnings per share in 2027.

Elevance expects its Medicare Advantage (MA) membership to drop about 18% or about 400,000. Medicaid rolls will drop as well. Medicaid enrollees are also expected to be more adverse.

Additional articles: https://www.fiercehealthcare.com/payers/elevance-health-beats-profit-misses-revenue-mixed-q4 and https://www.healthcaredive.com/news/elevance-2025-results-2026-outlook-lower/810680/ and https://www.beckerspayer.com/financial/elevance-posts-5-7b-profit-in-2025/

(Some articles may require a subscription.)

#healthplans #margins #elevancehealth #medicareadvantage #medicaid

https://www.modernhealthcare.com/insurance/mh-mied-elevance-health-quarter-bolstered-carelon

CMS Defends Flat Rates But Contraction Coming; UnitedHealth Crashes

The Trump administration’s top Medicare official is defending the meager proposed Medicare Advantage (MA) increase for 2027, saying the administration is a big supporter of MA. Large plans stocks dropped dramatically today after the after-hours’ announcement yesterday.

Analysts, trade groups, and plans are saying that yet another major contraction could occur in 2027. Benefits, products, and geographies began contracting in 2024, with major changes in 2025 and 2026.

While the economic growth rate was generous, the administration proposed two risk adjustment changes that will take nearly all of the 5% trend away. Some expect a contraction of enrollment from the 2026 enrollment season when statistics come out soon. I have doubted this, but it very well could happen.

Trump officials justify the risk adjustment changes and flat hike as an effort to combat overpayments in the program.

In other news, UnitedHealth Group’s stock crashed today dropping about 20% in light of poor financials and the impact of the MA announcement. Humana saw it stock drop by about that percentage as well, with other majors falling as well.

At its Q4 2024 financial call, UnitedHealth Group said it expects to lose between 1.3 million and 1.4 million MA members in 2026 across group, individual and dual special needs plans. UnitedHealth also expects to see some membership losses in Medicaid – a decline of between 565,000 and 715,000 people, including D-SNP enrollees. Commercial coverage could drop 550K to 850K. For full-year 2025, profits were $12.1 billion, down from $14.4 billion in 2024. Full-year 2025 revenues were $447.6 billion, up from the $400.3 billion reported in 2024. The medical loss ratio was 92.4% in Q4 2025 and 89.1 for the full year.

In shocking news, UnitedHealth is forecasting a decline in 2026 revenue, the first annual contraction in more than three decades. In a stunning reversal as well, Optum Health lost $278 million from operations in 2025, a major decline from the $7.8 billion in gains reported in 2024. Revenue fell less than 1% to $25.5 billion.

How the mighty has fallen.

Additional articles: https://www.fiercehealthcare.com/payers/unitedhealth-shares-fall-premarket-company-misses-revenue-releases-2026-outlook and https://www.modernhealthcare.com/insurance/mh-unitedhealth-group-earnings-optum-health/ and https://www.modernhealthcare.com/insurance/mh-unitedhealth-earnings-q4-2025/ and https://www.healthcaredive.com/news/medicare-director-defends-ma-2027-advance-notice/810635/ and https://www.healthcaredive.com/news/cms-proposed-2027-advance-notice-chart-reviews-medicare-advantage/810549/ and https://www.healthcaredive.com/news/unitedhealth-unh-q4-2025-medicare-advantage-troubles/810570/ and https://www.beckerspayer.com/financial/unitedhealthcare-projects-up-to-2-8-million-membership-decline-in-2026/ and https://www.beckerspayer.com/financial/unitedhealths-2025-profit-dips-to-12-1b/

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#medicareadvantage #healthplans #cms #rates #unitedhealthcare

https://www.fiercehealthcare.com/regulatory/cms-proposes-flat-ma-rates-risk-adjustment-updates-2027

MA Hit Hard By Proposed 2027 Rate Hike

The Trump administration threw Medicare Advantage (MA) for a loop tonight as it issued the 2027 Advance Notice of rates and set a meager projected hike. MA plans just weathered a three-year phase-in (2024 to 2026) of the new v28 model. By my calculation, that took about 7% out of rates. With skyrocketing utilization, plans had hoped for a 2027 hike that exceeded the rough 5% hike in 2026.

But Trump’s Center for Medicare and Medicaid Services (CMS) has now proposed two new risk adjustment reforms that take the almost 5% economic growth inflationary hike down dramatically – almost to 0. This will send stocks of major insurers dropping tomorrow for sure.

The draft calls for a 0.09% payment increase. That is an increase of roughly $700 million in MA payments for 2027 compared with $25 billion in 2026! When considering estimated risk score trends in MA driven by coding practices and population changes, the expected average change in payments will be 2.54%. But that is something plans reject as risk score trends at least in part recognize risk changes in the program from year to year.

What did CMS do?

Item 1: Additional changes to v28 model

— Use 2023 diagnoses to predict 2024 expenditures instead of 2018 diagnoses predicting 2019 expenditures.
— Use payment year 2024 vs. payment year 2020 for average per capita predicted expenditures to create relative factors in the model.

These changes essentially update years in the model to address emerging differences between MA and Original Medicare coding.

Overall, this first item reduces the rate hike by 3.32% with the normalization factor included (1.82% without normalization.)

Item 2: Eligible submissions

— Exclude diagnoses from audio-only services to align with MA diagnosis submission policy.
— Exclude diagnoses that appear in chart reviews but are not supported by corresponding medical encounters from how it calculates risk scores. CMS says MA plans received about $7.5 billion in 2023 for diagnoses that appeared only in risk assessments and related chart reviews but not on a medical encounter.

This second change reduces the rate hike by 1.53%. The agency said plans that rely more heavily on unlinked chart reviews to report risk-adjustment eligible diagnoses will see a greater payment impact. This would be the largest plans out there.

This will be very disappointing to MA plans, but what is likely to happen? As more FFS claims come in, we should see the economic growth rate increase. Last year, it increased by almost 3% between the advance and final. This is dependent on included timeframes, but utilization remains high so something should happen again. The administration could offer some relief from the risk adjustment proposals, including abandoning some or phasing them in. But I would not count on this last point.

I will cover much more on the rate hike and Star changes in a blog later this week.

Additional articles: https://www.modernhealthcare.com/politics-regulation/mh-cms-medicare-advantage-pay-2027-proposal/ and https://www.beckershospitalreview.com/finance/cms-proposes-nearly-flat-medicare-advantage-payments-for-2027-5-notes/ and https://www.cms.gov/newsroom/fact-sheets/2027-medicare-advantage-part-d-advance-notice and https://www.cms.gov/newsroom/press-releases/cms-proposes-2027-medicare-advantage-part-d-payment-policies-improve-payment-accuracy-sustainability

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#medicareadvantage #cms #rates #overpayments #riskadjustment

https://www.fiercehealthcare.com/regulatory/cms-proposes-flat-ma-rates-risk-adjustment-updates-2027

CareFirst Sues on Star Ratings

The now annual tradition of a Medicare Advantage (MA) plan suing over Star ratings continues. CareFirst BlueCross BlueShield is suing the Centers for Medicare and Medicaid Services (CMS) over its 2026 Star Ratings, alleging improper calculations cost the insurer an estimated $32 million in quality bonus payments.

The plan says CMS departed from its own guidance when it used corrected patient safety data released after the close of the plan preview period to calculate Star Ratings. CareFirst says it received a 3.5-star rating instead of 4 Stars for a contract with about 30,000 enrollees.

CareFirst says its Drug Plan Quality Improvement Measure for the contract was impacted by CMS contractor Acumen updating data after the close of the Plan Preview period. CMS has a hard rule that issues must be raised by plans before or during Plan Preview 1 and CareFirst says that CMS should have to follow the same rules. CMS declined to review the ratings when CareFirst raised the issue.

With some limited exceptions, especially the challenge to guard rail calculations, CMS has won more suits than not. But CareFirst raises a reasonable issue about process and holding the agency to the same rules as plans.

#medicareadvantage #stars #quality #cms

https://www.beckerspayer.com/legal/carefirst-bcbs-sues-over-2026-medicare-advantage-star-ratings/

Health Plan CEOs Grilled On Affordability

It was a bipartisan bashing of health plan CEOs on Capitol Hill today as both parties sought to protect themselves from healthcare affordability fallout. While the GOP was more sympathetic to the plan executives, they engaged in a great deal of attacks as well. The issues covered included the following:

• Plan executives tried to promote many of the reforms they have made, including in prior authorization. For the most part, it seemed not enough for lawmakers.
• Plan executives argued correctly that the real problem is not plans but drug and hospital prices in America. Lawmakers paid little attention here and sought to turn it back on some of the nefarious practices of the Uber healthcare organizations in front of them.
• Four of five CEOs agreed the healthcare system is broken when asked. Blue Shield CEO Markovich indicated that the hearings highlighted the need for “systemic” change.
• Lawmakers on both sides of the aisle attacked the plans over vertical integration and the hidden costs it drives. Executives tried to defend on the issue by arguing the benefits. This fell flat. Consolidation and mergers were also featured as driving costs. Lawmakers argued hospital consolidation and private equity investors are inflating costs and premiums.
• There was major criticism of MA from both sides of the aisle, including on growing overpayments from risk adjustment abuse.
• The No Surprises Act was featured as in need of reform, with plan executives saying providers have high-jacked the dispute resolution, while lawmakers also attacked plans for their behavior in the program.
• Lawmakers had major criticisms of the pharmacy benefits managers (PBMs) most of the executives own and how business is conducted. Plans argued the benefits of PBMs as well as recent promotion of biosimilars.
• Rep. Greg Murphy, R-NC and a doctor, laid out the plans’ litany of sins, including ruining Medicare Advantage (MA), overly consolidating, mistreating providers, overpaying executives, manipulating the No Surprises Act, and abusing prior authorizations (PA). Murphy is fighting a brain tumor and just had brain surgery.
• The CEOs declined… to embrace Trump’s health plan as the answer to affordability.
• Democrats and Republicans battled over policy differences and the lack of extension of enhanced Exchange premium subsidies.

In other news, the House passed its final four appropriations bills and they now go to the Senate. This needs to happen soon to avoid a partial shutdown.

Further, lawmakers accused CVS Health of violating antitrust laws by restricting independent pharmacies from working with digital pharmacy competitors to protect its market position.

Last, Cigna said its plan to end drug rebates will reduce earnings by $500 million to $600 million.

Additional articles: https://www.modernhealthcare.com/politics-regulation/mh-health-insurance-ceo-hearings-live-updates/ and https://www.bloomberg.com/news/articles/2026-01-21/cvs-health-may-have-violated-antitrust-laws-republican-lawmakers-say and https://www.fiercehealthcare.com/payers/insurance-ceos-set-back-back-congressional-hearings-affordability and https://www.beckerspayer.com/payer/house-committee-accuses-cvs-of-impeding-pharmacy-competition/ and https://www.modernhealthcare.com/insurance/mh-cigna-earnings-drug-rebates/ and https://www.beckerspayer.com/payer/vertical-integration-is-destroying-peoples-ability-to-access-care-payer-ceos-face-bipartisan-congressional-grilling/ and https://www.beckerspayer.com/payer/cvs-health-cuts-prior-authorizations-expands-rebate-sharing/ and https://thehill.com/homenews/house/5701980-house-government-funding-bills/ and https://www.healthcaredive.com/news/house-budget-committee-healthcare-affordability-consolidation/810149/

(Some articles may require a subscription.)

#healthcare #healthplans #healthcarereform #affordability

https://thehill.com/policy/healthcare/5701982-health-care-costs-insurance-ceos-testimony

UHG To Give Profits Back To Exchange Enrollees

In an effort to forestall charges against it over healthcare affordability, UnitedHealth Group announced today that it plans to give profits from its Exchange plans back to customers in 2026. Several top executives from the biggest plans will appear before two House committees Thursday as the GOP seeks to insulate itself from the affordability crisis. UnitedHealthcare offers plans on the exchanges in 30 states, and it expanded its service area in 11 of those regions. It is unknown how much money that is or if United will make a profit.

Additional articles: https://www.modernhealthcare.com/insurance/mh-unitedhealth-aca-rebates-congress/ and https://www.fiercehealthcare.com/payers/unitedhealth-ceo-hemsley-says-insurer-will-rebate-aca-profits-consumers and https://www.healthcaredive.com/news/unitedhealth-to-return-aca-profits-to-customers-hemsley/810183/ and https://www.modernhealthcare.com/politics-regulation/mh-stephen-hemsley-david-joyner-congress/

(Some articles may require a subscription.)

#unitedthealthcare #healthplans #congress #affordability #exchanges

https://thehill.com/policy/healthcare/5699770-unitedhealth-group-affordable-care-act-profits

Bipartisan Lawmakers Announce Deal To Keep Government Open

A bipartisan deal was announced that would keep the federal government open for the rest of federal fiscal 2026 (to Septemeber 30) and enact long-sought healthcare changes. Given the bipartisan and bicameral nature of the deal, the bill likely can be passed by the end of July when the government would otherwise partially shut down. But some fear conservatives in each chamber could oppose the deal on budgetary grounds.

Medicare telehealth coverage would be extended for two years. The Medicare hospital-at-home program would be extended for five years. The bill would also move further toward site-neutral payments in Medicare.

Medicare Advantage (MA) plans would be required to maintain accurate provider lists and patients who visit providers erroneously due to bad data would only have to pay in-network rates. The bill doesn’t include limits on MA prior authorization.

The bill also boosts pay to physicians participating in Medicare alternative payment models and enacts pharmacy benefits manager (PBM) reform (including transparency and flat compensation fees).

The package does not address extending the enhanced Exchange subsidies in any form. Medicare physician pay is not broached, either. Trump’s “Great Healthcare Plan elements are not included but would likely be in a GOP only reconciliation bill later.

Additional article: https://www.fiercehealthcare.com/regulatory/house-appropriations-committee-releases-health-funding-proposal

(Some articles may require a subscription.)

#governmentshutdown #congress #healthcare #coverage #pbms #medicare #siteneutral #medicareadvantage

https://www.modernhealthcare.com/politics-regulation/mh-pbm-telehealth-extension-congress-health-funding

— Marc S. Ryan

Exchange Compromise Appears To Be Fizzling

Prospects for a compromise bill in the Senate on an enhanced Exchange subsidy extension compromise appear to be fizzling. I have said the chance is at best 50-50 and now those odds are even dwindling. The negotiating group has failed to reach agreement on two of the biggest sticking points – allowing some or all of the dollars to move to health savings accounts (HSAs) and stricter “Hyde amendment” abortion restriction language. Meanwhile, some Democrats are also arguing the minimum premium of $5 or $10 per family per month is unaffordable for those who are low income. The GOP argues zero premiums have led to fraudulent enrollment.

On the home front, states and plans are waiting to see what the fallout of an average 26% premium hike and 114% hike for subsidized individuals will mean. The latest statistics say that enrollment is only down 800,000 from his time last year. But states are seeing drop-offs happening as people were required to pay their first premium before their January or February effective date. We will see what the real fallout is.

Meanwhile, Donald Trump is touting the $50 billion rural health fund as one solution to the affordability crisis. The funding was not the president’s idea but a last-minute add to get certain senators to vote yes. Vulnerable Republicans in 2026 joined him at a White House event.

Additional articles: https://www.nbcnews.com/politics/congress/senate-aca-funding-talks-fizzle-higher-premiums-take-effect-millions-rcna254227 and https://www.cbsnews.com/news/senators-aca-premium-tax-credits-extension-bipartisan-deal-stalled/ and https://www.politico.com/live-updates/2026/01/15/congress/the-senates-bipartisan-health-care-talks-are-on-shaky-ground-00732678 and https://www.politico.com/news/2026/01/15/democrats-make-pitch-to-keep-no-premium-obamacare-plans-00729669 and https://kffhealthnews.org/news/article/aca-obamacare-premium-payments-prices-marketplace-plans-hard-choices/ and https://www.modernhealthcare.com/insurance/mh-aca-enrollment-premium-payments/ and https://thehill.com/policy/healthcare/5692996-trump-rural-health-fund-affordability/

(Some articles may require a subscription.)

#exchanges #healthcare #coverage #affordability

https://thehill.com/homenews/administration/5692760-trump-rural-health-roundtable

Trump’s “Great Healthcare Plan”

President Donald Trump made a major healthcare announcement today, calling his reform framework “The Great Healthcare Plan.” But the announcement provided few details and leaves much of the work to Congress. GOP lawmakers do appear to be crafting ideas to limit exposure on healthcare unaffordability, but extending the expired enhanced subsidies may not be part of the deal.

Here is the very skeletal outline of the president’s proposals:

• Codifying both his proposed drug price models adopting most-favored-nation (MFN) pricing as well as the concessions deals he gained from 16 of 17 big drugmakers.
• Expanding over-the-counter and generic drug introduction.
• Existing subsidies in the Exchanges appear as if they will go directly to Americans in need and dollars deposited in individual Health Savings Accounts (HSAs).
• The cost-sharing reduction subsidies would again be appropriated after Trump himself zeroed it out in Trump 45. The move would save taxpayers at least $36 billion and reduce the most common Obamacare plan premiums by over 10%. A small cohort could be harmed.
• The plan would “end the kickbacks” from pharmacy benefits managers (PBMs) that are paid to what Trump calls the large brokerage middlemen “that deceptively raise the cost of health insurance.” This is a reference to big GPO buying firms, the largest owned by some of the biggest PBMs.
• The plan also would expand insurer transparency, including on medical claims denials, claims payments, wait times, prices, and more.
• Insurers would need to provide rate and coverage comparisons upfront on their websites in “plain English” to help consumers more easily shop for plans.
• Disclosure of medical loss ratios would also be mandated.

President Trump deserves a great deal of credit on drug price reform, but otherwise the deal is not well thought out and does not tackle the true reason for a lack of affordability – price in the market. I will give more details in a blog soon.

Additional articles: https://www.fiercehealthcare.com/regulatory/trump-takes-aim-insurance-industry-unveiling-great-healthcare-plan and https://www.beckerspayer.com/policy-updates/trump-pitches-healthcare-policy-outline-aimed-at-lowering-costs-3-takeaways/ and https://www.cnn.com/2026/01/15/politics/trump-health-care-plan and https://apnews.com/article/trump-health-care-insurance-congress-savings-accounts-b7b4caae9ad14fda4646c42d3858202b and https://www.cnbc.com/amp/2026/01/15/trump-congress-aca-subsidies-health-care.html and https://www.whitehouse.gov/articles/2026/01/president-trump-unveils-the-great-healthcare-plan-to-lower-costs-and-deliver-money-directly-to-the-people/ and https://www.whitehouse.gov/wp-content/uploads/2026/01/The-Great-Healthcare-Plan.pdf and https://thehill.com/policy/healthcare/5691065-trump-health-care-affordability-plan/ and https://www.healthcaredive.com/news/trump-great-healthcare-plan-affordability-aca/809759/ and https://www.medpagetoday.com/publichealthpolicy/healthpolicy/119456

(Some articles may require a subscription.)

#healthcare #healthcarereform

https://www.modernhealthcare.com/politics-regulation/mh-trump-great-healthcare-plan-drugs-premiums