25 Hospital Systems Just Dropped Medicare Advantage - Here's What to Do If Yours Is Next

Medicare Advantage plans may help seniors save money in retirement, but as hospital systems cut ties with the plans, enrollees may face some significant changes. When a health system leaves a Medicare Advantage contract, a patient might lose a longtime doctor overnight, ending that important continuity of care and the trust that's developed. Additionally, the plan's advertised out-of-pocket protections may no longer apply the way enrollees expected, potentially leaving them with significant health care costs.

With more systems cutting ties with the plans, it's important for Medicare Advantage enrollees to be aware of the issue and to understand what options they have in this type of situation.

How many hospital systems are dropping Medicare Advantage

Becker's Hospital Review has been reporting on hospital systems dropping some or all of their Medicare Advantage contracts since 2023. According to Becker's data, 32 health systems dropped Medicare Advantage plans in 2024, while 40 systems dropped the plans in 2025.

Becker's just released new data indicating that 25 health systems are dropping Medicare Advantage plans in 2026. Since we're only partway through the year, additional systems might be added to the list as the year progresses.

Why hospital systems are dropping Medicare Advantage plans

Hospital representatives often cite slow reimbursement, payment disputes, prior-authorization burdens, and administrative costs in explaining the choice to drop Medicare Advantage plans. However, in some cases, the insurer ends the contract.

Regardless of the reason for the contract's end, the patient is the one who absorbs the disruption. Given the substantial Medicare Advantage enrollment, the consequences of these decisions may be widespread; more than half of eligible Medicare beneficiaries are currently covered by Medicare Advantage plans.

The cost of a cancelled Medicare Advantage contract

Hospital systems cancelling these contracts may lead to substantial costs for patients. The 2026 out-of-pocket limit for Medicare Advantage plans is capped at $9,250 for in-network services. However, that cap increases to $13,900 for in-network and out-of-network services combined, meaning patients might pay substantially more out of pocket if they continue receiving care at a hospital that is no longer in-network.

The cap doesn't apply to Medicare Part D expenses; Part D out-of-pocket spending is capped at $2,100 in 2026. If retirees are living on a fixed income, coping with those additional expenses may be very difficult and might prompt them to have to seek care at a different hospital.

The reality of switching back to Original Medicare and Medigap

If your hospital system drops your Medicare Advantage plan, it might seem logical to switch back to an Original Medicare and Medigap plan. Medicare Advantage plans bundle the coverage from Original Medicare and sometimes feature a Part D plan, so switching back might give you the same or similar coverage.

While you may switch back, you must cancel your Medicare Advantage plan and return to an Original Medicare plan before you may apply for a Medigap plan. Once you've switched back to Original Medicare, you'll usually have 63 days to apply for a Medigap plan to have guaranteed-issue rights, meaning any health issues you have won't result in you being denied coverage or being charged a higher premium. If you miss that 63-day period, an insurer might require you to have a health screening, and they might charge you a higher premium or deny you coverage based on the results of that screening.

When you may switch back to Original Medicare

Further complicating the matter is the fact that you may only make these changes during certain enrollment periods. Generally speaking, once you're past your six-month Medigap open enrollment window, you may only switch to Original Medicare during the open enrollment period from January 1 to March 31, or during the annual enrollment period from October 15 to December 7.

If you're outside of these enrollment periods, you may only be able to make the switch if you experience a qualifying life event that makes you eligible for a Medicare Special Enrollment Period. Examples of qualifying life events include if you move out of your plan's service area, if your Medicare Advantage Plan stops operating, or if you move into or out of a nursing facility.

Additional steps to take if your hospital is leaving Medicare Advantage

If you receive notice that your hospital is leaving your Medicare Advantage plan, contact your hospital's insurance department and your insurer directly. Verify which plans the hospital system would honor and write down those plans for your search if you want to switch coverage. Don't rely on a plan's directory of participating health systems or doctors, since this information may be out of date or inaccurate.

Keep any documentation you've received, such as letters alerting you to upcoming changes, and be sure to double-check dates. You may want to contact your State Health Insurance Assistance Program for additional guidance. The program may be able to advise you about any state protections available to help you navigate this situation.

Bottom line

Navigating an unexpected change in your health insurance coverage may be stressful and frustrating, but if you learn your hospital system is leaving your Medicare Advantage plan, stay proactive. Finding another plan that's a better fit for your needs may help you save money while also continuing to access the health care you need.

Choosing the right health insurance plan and budgeting for unexpected health expenses is an essential part of planning for retirement. Including these expenses in your retirement plan may help minimize your stress as you navigate any health challenges or changing health needs you might face.

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