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Humana plans to exit low-rated Medicare Advantage options in 2027
Non-renewal notices are dated October 2, and about 360,000 members may still need new coverage after Humana expects to recapture roughly 40% into other plans.
Humana is set to stop offering selected Medicare Advantage plans for the 2027 bonus year, with non-renewal notices going to about 600,000 members in early October, according to Insurance Business. The letters will tell beneficiaries their current plans will not exist in 2027, creating a deadline for brokers and customers to act.
The company said the exits follow its July 29 earnings call, and they target plans rated 3.5 stars or lower rather than cutting benefits across the board. Humana Chief Financial Officer Celeste Mellet said the approach is meant to cut the lower tail of profitability, while CEO Jim Rechtin said the strategy targets a sustainable pre-tax margin of at least 3% by 2028.
Humana expects to move about 40% of affected members into other Humana plans, based on its 2025 experience, leaving an estimated 360,000 beneficiaries to find coverage elsewhere. Federal rules require the non-renewal notice to be dated October 2 for coverage ending December 31, and members have until December 7, the close of Medicare’s annual enrollment period, to select new coverage.
The 2027 round is Humana’s second consecutive year of Medicare Advantage exits, after it pulled back in 2026 from three states and 194 counties, shrinking its footprint to 46 states and 85% of US counties. Insurance Business also points to mounting pressure across the market, including a Johns Hopkins Bloomberg School of Public Health study in JAMA that found about 2.9 million Medicare Advantage members were forced to find new plans for 2026, or roughly 10% of enrollees.