Medicare Advantage special needs plans, explained

We know health plans can be confusing, whether it’s businesses adapting to constantly changing laws, understanding public and private payers, or simply completing a prior authorization request.

Now, we are going to try to make one area of insurance a little easier to understand: Medicare Advantage Special Needs Plans (SNPs).

As Medicare Advantage (MA) is Medicare’s private alternative to traditional Medicare, SNPs take it a step further by giving members who have extra needs access to specific benefits (more on this later). The first SNPs were offered all the way back in 2006, though it took some legislative work to make them a permanent MA offering by 2018.

KFF reported that SNPs now make up 21% of all MA enrollees as of 2025, compared to 13% in 2018. This bump has transcended into MA growth generally, as enrollment increased 1.1 million to 35+ million MA members between February 2025 and February 2026, KFF also reported. (For reference, total MA membership was only 8 million in 2007.)

“Allowing plans to specialize in certain populations [enables] plans to better coordinate care and specialize the benefits, tailor the benefits to these populations,” Gretchen Jacobson, VP of Medicare at the nonprofit Commonwealth Fund, told Healthcare Brew.

What are SNPs?

There are three types of SNPs, each designed to address specific patient needs.

The largest group comprises D-SNPs—82%, per KFF—for dual-eligible people, meaning they are on both Medicaid and Medicare. People who use D-SNPs are often lower income and “benefit from a plan that helps with the coordination between those two benefits,” consultancy HealthScape Advisors Senior Partner Alexis Levy told us.

Next are C-SNPs, which provide coverage to people with chronic conditions like diabetes and congestive heart disease. These make up 16% of SNP enrollees, according to KFF.

Last is the smallest group, institutional SNPs, or I-SNPs, which KFF says cover 2% of enrollees, for people who qualify for ongoing nursing home or other long-term care.

“The common denominator around [SNPs] is that they’re really specialized plans built for people who have more complex needs,” Levy said.

You’re probably thinking: Aren’t some people with chronic conditions dually eligible or receiving care in a nursing home? Yes, but in those instances, patients can choose their plans based on what they most want or need, according to Jacobson.

How have SNPs grown?

SNP enrollees have grown significantly since 2018, from 2.6 million to 7.3 million members in 2025, KFF reported, with D-SNPs leading that growth (2.2 million members in 2018 to 5.8 million by 2024).

This growth in SNPs occurred amid a general drop in MA interest as major payers make continued pushes to decrease enrollment. That’s in part due to favorable margins and the fact that health plans can more easily predict SNP members’ medical needs, Healthcare Brew previously reported.

“Special needs plans have sicker enrollees, and as a consequence, the dollars that they get from the federal government for extra benefits are much larger,” Jacobson said.

SNP enrollment is dominated by the major health plans, with UnitedHealth Group and Humana covering 54% combined, according to KFF. Only 14% are offered by nonprofit payers.

While D-SNPs are still the largest segment of the plans, C-SNP enrollment is growing (346,000 enrollees in 2018 to 674,500 enrollees in 2024, per KFF). Levy said this is partially due to the fact that D-SNPs have new requirements to integrate Medicare and Medicaid better so patients can deal with Medicare and Medicaid as one entity, rather than two separate offices.

“On the D-SNP side, if you’re a plan and you don’t offer Medicaid, you might be somewhat at a disadvantage given the integration requirements,” Levy said. Though, she added, D-SNP integration could also ease insurance processes for people with complex medical needs.

Will the One Big Beautiful Bill Act (OBBBA) affect SNPs?

The OBBBA is expected to bring even more change to the healthcare industry, especially in terms of anticipated Medicaid cuts.

Jacobson said she doesn’t expect a direct impact on SNPs from the OBBBA, though she said reductions in federal Medicaid payments could constrain state budgets. This could even change which Medicaid benefits are available in some states where budgets could be reduced by up to $665 billion between 2025 and 2034, we previously reported.

“[Payers] could choose to drop some optional benefits, such as home- and community-based services or dental benefits that are used a lot by people who are dually eligible for both Medicare and Medicaid,” Jacobson said, adding that these changes could “certainly affect the health of the population that they’re serving.”