UCare collapse forces 2,500 Medigap members to switch plans by Jan. 1
UCare’s financial freefall has led the Minnesota Department of Health to place the Twin Cities‑based health plan into court‑supervised receivership, and about 2,500 of its Medicare Supplement policyholders now have only days over the holiday season to secure new coverage or risk a gap starting Jan. 1, 2026. After a record surplus in 2022, UCare lost roughly $500 million by the end of 2024 and told regulators it could not pay its debts without a merger, but members say they were initially assured their Medigap policies would be unaffected by the planned transition to Medica before receiving last‑minute cancellation notices.
📌 Key Facts
- UCare confirmed that approximately 2,500 members with Medicare Supplement (Medigap) plans must move to new carriers before Jan. 1, 2026 to avoid losing coverage.
- The Minnesota Department of Health has petitioned a court to put UCare into receivership, asserting its financial condition made continued operation 'hazardous to the public or its insured' and that MDH must take control to protect consumers and stabilize operations.
- UCare went from a record surplus in 2022 to a roughly $500 million loss by the end of 2024 and told MDH and the Department of Commerce in August 2025 that, absent an acquisition, it would be unable to pay its debts in the new year.
- Members report receiving only a few business days’ notice—some without the required official termination letter until this week—despite prior assurances their Medigap coverage would carry through the transition to Medica.
📊 Relevant Data
UCare reported an operating loss of $504 million in 2024, primarily due to rising costs in its Medicare Advantage and Medicaid businesses, along with higher service utilization.
UCare posts $504M operating loss in 2024 — Becker's Payer Issues
More than two-thirds of regional nonprofit health insurance companies in the US recorded operating losses in 2024, driven by rising healthcare costs and lagging government reimbursement rates.
Regional nonprofit health insurers falling behind competitors — Modern Healthcare
In Minnesota, as of 2020, UCare's Medicare Supplement enrollment was predominantly among individuals aged 90 and older (12 out of 14 total members), with more females (10) than males (4).
Members as of December 31, 2020 UCARE Minnesota Supplement Report #6 — Minnesota Department of Health
UCare's Prepaid Medical Assistance Program (PMAP), a major source of its enrollment, served 281,903 members in 2020, with a higher proportion of females (150,871) than males (131,032), and the largest groups being children aged 5-9 (43,032 total).
Members as of December 31, 2020 UCARE Minnesota Supplement Report #6 — Minnesota Department of Health
Minnesota HMOs and county-based purchasing plans reported a $640.4 million loss on Medicaid plans in 2024, following profits in previous years, due to higher medical expenses and lower revenues.
Minnesota Health Market Review 2025 — ResearchAndMarkets.com
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