The Medicare Advantage market is entering a new phase defined by slower growth, financial retrenchment, and heightened operational discipline among health plans. Our annual analysis of Medicare Advantage enrollment data (now published through HealthScape Advisors, a Chartis Company) reveals that enrollment growth continues to decelerate and shift.
The era of rapid, broad-based expansion has come to an end. Even so, the market continues to advance, despite extreme compounding headwinds.
For health systems, this reset signals both near-term disruption and a longer-term mandate for greater collaboration with payers toward enabling better access, affordability, and outcomes.
Key Medicare Advantage enrollment trends to know
- Medicare Advantage growth is cooling but more concentrated
Growth is down to 2.5% (from 3.6% in 2025) and is less at the expense of Original Medicare. Meanwhile, several carriers exited markets or scaled back geographic footprints, while others reduced benefits or curtailed new enrollment. As a result, net enrollment gains flowed disproportionately to Humana and select challengers. - SNPs are powering the next wave
Special Needs Plan (SNP) enrollment grew 12.2%, including a striking 49% increase in Chronic Condition SNPs (C-SNPs). Individual enrollment grew only 0.1%, and Employer Group Waiver Plan enrollment declined 0.7%. - Plan choice is shrinking, but member preference is stable
Total plan offerings declined 2.5% for the third consecutive year, including a 10% drop in PPOs. Yet beneficiary enrollment patterns remained steady—even as carriers increasingly favor HMOs to better control utilization and manage medical cost trends. - Financial and quality pressures are mounting
Lower-than-anticipated rate increases and rising medical costs are straining margins. While average star ratings held steady, only 67% of members are now enrolled in plans with 4+ stars—down significantly from earlier in the decade—raising pressure to improve performance.
How these trends may impact health systems
- Expect more market disruption
As health plans weigh whether they should stay or exit the Medicare Advantage market, this may affect payer mix, contract renegotiations, and shifts to patient coverages. - Anticipate a heightened focus on the fundamentals and ROI
Many health plans will undertake multi-year turnaround efforts across their strategy, product, and supporting operating models. They’ll also be pursuing benefit strategies that demonstrably support retention, quality, and cost control. Providers should expect continued and increased pressure from health plans to keep reimbursement rates and spend down as they focus on profitability through administrative programs. - Prepare for greater collaboration on impact
Health plans that intend to stay in Medicare Advantage for the long run will likely turn to deeper collaboration with fewer, more aligned provider organizations to manage medical cost trends and improve patient outcomes. Over time, interoperability, shared accountability, and value-based models will take precedence over network breadth.
Medicare Advantage is evolving for the long term
As the Medicare Advantage market resets, carriers that stay in the market will double-down on delivering value to beneficiaries. While health systems can prepare for anticipated changes, they also can become more active players in collaborating with health plans to improve quality and outcomes—particularly for the large and growing population of complex senior populations covered by Medicare Advantage plans.
