Humana and UnitedHealthcare, two of the nation's largest health insurers, are discontinuing a wave of Medicare Advantage plans for 2027 — a decision that will force nearly one million seniors and people with disabilities to find new coverage during this fall's open enrollment period. The pullback follows a year of surging medical costs and compressed profit margins, and it amounts to one of the most significant retreats in the history of the privatized Medicare program.

Nearly One Million Members Forced to Re-Shop Coverage

UnitedHealthcare has confirmed it will discontinue plans covering approximately 390,000 members and will withdraw entirely from Wyoming in 2027, according to company statements and provider filings. Humana has separately said its plan exits will affect roughly 600,000 members — a figure Humana CFO Celeste Mellet detailed during the company's July earnings call. Combined, the two insurers are ending coverage for about 990,000 people.

The cancellations are not limited to the two giants. Aetna, the Medicare Advantage arm of CVS Health, is also shrinking its footprint for 2027, offering plans in 41 states plus Washington, D.C., down from 43 states, with enrollment expected to decline by roughly 950,000 members as it exits certain markets. Analysts cited by Fortune said Clover Health, UnitedHealthcare, Humana and Centene are showing the clearest "prioritization of margin over growth" in the industry.

"As previously disclosed, we anticipate plan exits for 2027 will impact approximately 600,000 members," Humana said in a statement to CBS News. A UnitedHealth spokesperson separately confirmed the roughly 390,000-member figure.

How the Medicare Advantage Retreat Unfolded

The industry-wide pullback has been building for more than a year, with each step driven by the same underlying pressures:

  • Feb. 11, 2026: Humana reports a $1.01 billion fourth-quarter loss for 2025 and warns earnings will decline in 2026 due to headwinds from lower Medicare Advantage enrollment and rising medical costs.
  • July 29, 2026: Humana confirms its 2027 Medicare Advantage exits will affect about 600,000 members as the insurer continues to focus on margin recovery.
  • Sept. 29, 2026: Newly released CMS data shows insurers culling plans across the country, with plan options falling in 28 states.
  • Oct. 1–2, 2026: UnitedHealth, Aetna and Humana formally roll out their 2027 plan lineups, and member notifications are mailed.
  • Oct. 13, 2026: UnitedHealth Group reports third-quarter results, including an improved medical cost ratio of 88.4%.
  • Oct. 20–21, 2026: National outlets confirm the combined impact of nearly one million affected members.

Why Insurers Are Choosing Margins Over Market Share

The driving force behind the cancellations is straightforward economics. Medicare Advantage, which now covers more than half of all Medicare beneficiaries, has become less profitable as insurers absorb a spike in medical utilization and higher costs for hospital care, doctor visits and prescription drugs. The medical cost trend is running at its highest level in nearly two decades, with some projections putting commercial healthcare cost growth near 9% for 2027. At the same time, the federal government has been working to rein in the payments it sends to Medicare Advantage insurers.

UnitedHealth Group's third-quarter results illustrate the tension. The company posted revenue of $112.7 billion and adjusted earnings of $4.69 per share, up 61% from $2.92 a year earlier, while its medical cost ratio — the share of premiums paid out for care — improved to 88.4% from 89.9%. Yet the stock still fell 5.1% the day of the report, a sign that investors remain wary of the long-term outlook for the Medicare Advantage business.

That wariness is justified by the membership data. UnitedHealthcare lost 647,000 Medicare Advantage members between March 2025 and March 2026, the largest single-year drop ever recorded for a single insurer. Humana ended 2025 with 5.8 million Medicare Advantage members, a 6.3% decline from 2024, and has said it expects to lose money on its individual Medicare Advantage business in 2026 while maintaining a full-year adjusted profit forecast of at least $9 per share. For Humana, one bright spot has been a dramatic improvement in Medicare star ratings, which jumped from about 20% of members in highly rated plans to 95% after a difficult 2026. Star ratings matter because they determine the bonus payments insurers receive from the federal government.

Where Things Stand for Seniors Right Now

Affected members should have received notices dated around Oct. 2, 2026, explaining that their plan is being discontinued. The Annual Enrollment Period, when seniors can switch plans, runs through Dec. 7, 2026. Members whose plans are ending also have a Special Election Period through Feb. 28, 2027, to select a new Medicare Advantage plan if they return to Original Medicare first.

The disruption extends well beyond Humana and UnitedHealthcare. Across the industry, an estimated 3.2 million seniors are losing their current Medicare Advantage plans for 2027, according to Yahoo News. At the same time, average in-network spending limits are rising about 9%, prescription drug deductibles are climbing roughly 23%, and many $0-premium plans and extra benefits — such as dental, vision and over-the-counter allowances — are being trimmed.

Financial advisers and Medicare counselors are urging seniors not to simply default into Original Medicare. Instead, they recommend comparing plans on Medicare.gov, confirming that doctors and hospitals remain in-network, and reviewing drug formularies before the Dec. 7 deadline.

What Investors Should Watch in 2027

For investors in UnitedHealth Group (NYSE: UNH), Humana (NYSE: HUM) and CVS Health (NYSE: CVS), the Medicare Advantage retreat is a double-edged story. Exiting unprofitable counties and cutting low-margin plans can protect and eventually rebuild profit margins, but it also surrenders market share in a segment that remains the industry's most important growth engine as the U.S. population ages.

The key metrics to monitor through 2027 include each insurer's medical cost ratio, membership retention and star ratings. Insurers that can hold medical costs below premium growth while stabilizing enrollment will be best positioned to reward shareholders. UnitedHealth's improved 88.4% medical cost ratio and its raised full-year guidance of at least $20.50 per share suggest the largest player is already making progress on the margin side, even as it accepts near-term membership losses. Humana's strategy is similarly focused on margin recovery, betting that improved star ratings will restore bonus revenue and profitability even with fewer members.

The Bottom Line

  • Humana and UnitedHealthcare are ending Medicare Advantage plans for nearly 990,000 members in 2027, while Aetna is also scaling back.
  • The pullback is driven by rising medical costs and utilization, with insurers explicitly prioritizing profit margins over membership growth.
  • UnitedHealthcare lost 647,000 Medicare Advantage members in the year through March 2026, and Humana expects to lose money on its individual Medicare Advantage business in 2026.
  • Affected seniors must re-shop by Dec. 7, 2026, or use a Special Election Period through Feb. 28, 2027.
  • For investors, margin recovery is the near-term story, but membership retention and star-ratings-driven bonus payments will determine the longer-term winners.