What happens when nearly an entire state is kicked off Medicare Advantage?

Nearly the entire Medicare Advantage (MA) market in Vermont disappeared this year. It’s an unusually extreme example of an emerging nationwide trend.

Though companies enter and exit the MA game all the time, disenrollments are spiking as MA providers reduce benefits and leave less profitable markets (minus special needs plans, of course) in response to rising medical expenses and increased federal scrutiny and limits.

As a result, about 92% of Vermont’s MA enrollees were forcibly disenrolled after insurers exited their county, per a Feb. 18 JAMA research letter.

Nationally, an average of 10% of beneficiaries in HMO and PPO plans (2.9 million) were forcibly disenrolled and left with the option of joining another MA plan if one was available or enrolling in traditional fee-for-service Medicare. In 2025, it was 7%. Prior to that from 2018–2024 it averaged 1%.

This spike in disenrollments is one of the “trade-offs” to policies that reduce payments to MA providers, Mark Meiselbach, the research letter’s coauthor and health economist at Johns Hopkins Bloomberg School of Public Health, told us.

“There will be these sorts of costs,” Meiselbach said. “If you’re making the program overall less profitable to insurers—which we think it should be—that means that some people will lose access to their plans because some insurers will no longer feel that their plans are viable.”

Why Vermont stands out. Vermont’s collapse happened over the course of two years. In 2025, two payers, MVP and Centene subsidiary Wellcare, left the state’s MA market. Two more, Blue Cross Blue Shield of Vermont and UnitedHealthcare, left this year, leaving only one company, Humana, to offer plans in just five counties.

As a result, only 12%, roughly 21,000 people, of eligible Vermont adults are enrolled in MA as of February 2026, per data provided to Healthcare Brew by consulting firm HealthScape Advisors.

Insurance agents and navigators have told local media they were flooded with requests for guidance this fall from residents who learned their MA plan was ending. Next year, Humana could retract even more. The payer reported in its Q4 2025 earnings that it had gained about 1 million individual MA members during an open enrollment period when most plans were trying to shrink their member pools.

A lesson for others? Vermont has never had a huge MA market, and its fall in enrollment is a blip, a rounding error, when counting it as a chunk of MA’s 35 million total enrollees. Even before these major plan exits, Vermont only had 52,000 MA enrollees in 2024, per HealthScape data.

But Vermont’s story may also serve as a lesson, Meiselbach said. When MA plans exited the state in 2025, their unprofitable members transitioned to the remaining plans, potentially hurting those plans’ profits enough that they had to exit for 2026.

“Vermont might just be the cautionary tale for places that are seeing big declines [in MA offerings] this year in the way that Vermont did last year,” Meiselbach said.

While Vermont faced state-specific issues that hiked up its disenrollment rate, like local nonprofit MA plans with unique financial struggles, it also shares characteristics with some other states that faced high disenrollments.

MA plans also have a hard time making a profit in areas like Vermont that are largely dominated by one main healthcare system, Gretchen Jacobson, VP of Medicare at nonprofit research foundation the Commonwealth Fund, told Healthcare Brew. In these circumstances, healthcare providers have more negotiation leverage than payers, which can lead to payers getting worse deals on reimbursement rates, Jacobson said.

Santa Barbara, California, is another example of a place where MA does not have a big presence, in part because one main health system dominates the city’s market, Jacobson said.

Vermont is also one of the most rural states in the US, one of the factors associated with beneficiaries who are more likely to be forcibly disenrolled, the JAMA article found. Some other rural states like Wyoming, South Dakota, and Idaho saw disenrollments of 40% or more in 2026 per the study, though some urban states also saw very high disenrollment rates, like Maryland.

“We’re maybe at a new phase in the development of the Medicare Advantage market, where companies are really refining and adjusting their strategy,” Jacobson said.