Payers continue to predict Medicare Advantage, ACA marketplace enrollment losses

Normally, you want more customers, right? Apparently not if you’re a health insurance company and those customers come with high medical costs.

With enrollment now underway for next year’s Medicare Advantage (MA) and Affordable Care Act (ACA) marketplace plans, major payers are spiking prices and reducing benefits—an approach they hope strategically curbs growth amid elevated medical costs, according to those companies’ Q3 earnings calls.

Backtracking on MA. Annual enrollment for MA began Oct. 15. The average beneficiary has 32 MA prescription drug plans available in 2026, fewer than this year (34) but higher than the majority of years the program has been around, per KFF.

Payers like UnitedHealth and Humana look to be very invested in reducing and shifting MA enrollment.

After receiving another year of poor star ratings, Humana President and CEO Jim Rechtin said in an Oct. 2 update the payer wouldn’t be “actively selling” most plans in its largest MA contract, which currently has 3.5 stars. Instead, it’s trying to shift its MA members into plans with four or more stars.

UnitedHealth, too, is backing away from MA. The company had poor Q1 earnings in April after taking on new MA members with higher-than-expected medical costs. The rest of the year has been about coming back from that.

In Q3, however, United beat expectations and is on track to lose 1 million of its 8.4 million MA members in 2026, UnitedHealthcare CEO Tim Noel said in the company’s Oct. 28 earnings call.

Meanwhile, Humana—which had previously projected losing 500,000 members—said in its Q3 earnings it now only expects to lose about 425,000 of its 5.2 million individual MA members due to better-than-expected sales. Alongside this announcement, Humana cut its full-year earnings guidance.

“We are prepared to take targeted actions to slow new sales if we reach the point where the volume risks negatively impacting member experience,” Rechtin said during the company’s Nov. 5 earnings call.

ACA marketplace woes. UnitedHealth is also walking back last year’s choice to expand its ACA marketplace offerings.

The company raised its marketplace plan premiums by an average 25% and made “targeted service reductions,” which is expected to reduce enrollment by about two-thirds, Noel said during Q3 earnings calls.

Centene EVP and CFO Drew Asher said the managed care provider’s marketplace plans would see an average “mid-30%” rate increase.

Overall, insurers raised marketplace premiums for 2026 by 26%, KFF found, in anticipation of the planned expiration of enhanced premium tax credits at the end of this year. As the government shutdown drags on, it’s still not clear whether they may be extended.

“If the subsidies are extended, we will work closely with states to support implementation and ensure continued access for consumers who rely on this coverage,” Gail Boudreaux, Elevance president and CEO, said during the insurer’s Oct. 21 call.

Medicaid struggles. Payers also continued to gripe that state Medicaid reimbursement rates don’t reflect the acuity of the Medicaid member pool as medical costs rise.

During Elevance’s earnings call, CFO and EVP Mark Kaye pointed to state reverification processes and stricter eligibility requirements as leading to “lower-acuity” members getting disenrolled. Those left behind are sicker and more costly, he said, and rates haven’t caught up, adding that “2026 is going to reflect those same continued pressures in Medicaid as rates catch up to acuity.”

Centene CEO Sarah London said in the company’s Oct. 29 earnings call that the managed care organization is focused on reducing elevated Medicaid costs. Those high costs were one of the factors that led it to retract its full-year guidance in July, alongside a prediction from actuarial firm Wakely that ACA marketplace enrollees would be fewer and sicker.

Financial services firm Baird analysts noted Centene’s Medicaid business performed “better than expected” in Q3 but it’s too soon to say it’s out of the woods.

“The broader [Medicaid] market is experiencing elevated (if not worsening) cost trends and ongoing membership attrition,” the analysts noted in an Oct. 29 note on Centene’s earnings.