Health care costs are soaring across the board, with Minnesota seniors facing acute changes

Premium increases, vanishing choices and bigger spending requirements when seniors use health care next year are roiling the Medicare Advantage market in Minnesota.

The shifts in insurance coverage are being driven in part by higher prices for services as well as increased use of health care — forces that are pushing up expenses across all types of insurance.

The challenges are acutely visible today in the Medicare Advantage market, which is a privatized form of Medicare where seniors have until Dec. 7 to enroll in new plans for next year.

The changes are driving a surge of calls to Minnesota Aging Partnership, a statewide call center where trained staff help with Medicare and other topics are handling more than 2,000 calls per day — record volume that’s about three times the average.

“There’s no hiding right now from the higher costs,” said Brooks Deibele, an executive vice president in Minneapolis with benefits consultant Holmes Murphy.

People who buy their own health insurance, and those in small employer plans, got the bad news about premium jumps in Minnesota a few weeks ago.

Details at large employers are just beginning to emerge, but total health benefit costs per employee next year are expected to rise an average of 6.5% — the highest increase since 2010, according to report last month from Mercer, a New York-based human resources consultant.

”It is literally multiple things – it’s not one thing, which means there’s not one silver-bullet answer to control costs," Deibele said.

In Medicare, about 653,000 beneficiaries in Minnesota elect to receive government-sponsored Medicare benefits via Advantage plans, which are run by insurance companies.

More than 500,000 state residents get benefits through original Medicare. This traditional program includes large out-of-pocket spending requirements when patients use care, and beneficiaries generally are counseled to buy a Medicare Supplement policy.

In addition, people with original Medicare are encouraged to purchase standalone “Part D” drug plans, which private insurers sell during open enrollment.

A Minnesota Star Tribune review of state data shows the number of companies selling Medicare Supplement policies in Minnesota has declined over the past year, from 16 to 13. Premiums for these policies are generally on the rise.

Similarly, the number of Part D drug plans sold in Minnesota is declining from 14 this year to 11 in 2026.

Some premiums for this coverage are going down, but there are also notable increases. About 39,000 beneficiaries who have Blue Cross and Blue Shield’s MedicareBlue Rx Standard, for example, will see their costs increase from $51 to $101 per month unless they make a change.

“We examined our Medicare portfolio and made necessary adjustments to help maintain long-term stability in the market amid multiple financial pressures,” Eagan-based Blue Cross said in a statement.

A Star Tribune review of federal data plus the Medicare Plan Finder website shows roughly 200,000 enrollees across the state are losing their current Medicare Advantage plans. That’s primarily due to a huge statewide pullback at Minneapolis-based health insurer UCare, plus smaller exits from specific counties by Blue Cross, HealthPartners, Humana and UnitedHealthcare.

Double-digit premium increases are coming for another 200,000 people in Medicare Advantage plans, according to the Star Tribune review, if they don’t switch to different coverage.

One UnitedHealthcare plan with about 20,000 current enrollees, for example, will see premiums increase by 42%, from $66 to $94 per month. The company noted, however, that most UnitedHealthcare members paying premiums for plans this year will have access to a different option with a $0 premium next year.

The Star Tribune reported Thursday that Mayo Clinic won’t be in-network for most UnitedHealthcare Medicare Advantage plans starting next year.

“2026 is a pivotal moment for the Medicare Advantage program,” said Bobby Hunter, UnitedHealthcare’s chief executive of government programs, during a call with reporters last month. “We are making tough decisions ... in response to the [Medicare] funding cuts and the medical cost pressures that are significantly impacting the program.”

In addition, the maximum out-of-pocket (MOOP) spending limit on annual costs is increasing next year for many subscribers. This limit on one plan from Minnetonka-based Medica, for example, will increase from $3,700 to $6,750.

“It is important to note that many, if not most, members don’t reach their full MOOP each year,” Medica said in a statement. “As a result, they do not all face the full impact of that 82% increase.”

Seniors who have contacted the Minnesota Star Tribune over the past two weeks have been dismayed by the lengthy “Annual Notice of Change” documents they’ve been receiving from their insurers. One from Blue Cross, for example, shows rising copays for specialist office visits and inpatient hospital stays plus a higher deductible for drug costs.

“This is much bigger than just a premium increase,” one beneficiary wrote via e-mail about her Medicare Advantage coverage.

The single biggest disruption for Minnesota seniors this fall stems from UCare, which is pulling plans that cover 158,000 people. About 800 people attended a virtual meeting promoted by UCare on Tuesday, with general background about Medicare options.

One wrinkle for Medicare beneficiaries is that they only have rights at certain times to purchase Medicare Supplement policies — often called “Medigap” coverage — without being asked questions about their health history. Normally, insurers can deny Medigap policies to applicants based on these answers, but people losing UCare plans “have guaranteed issue rights” to buy the coverage without questions," Deborah Buckingham, the volunteer and outreach assistant manager with Minnesota Aging Pathways, said during the session.

With the insurance company exits, Buckingham said there will be no Medicare Advantage plans available next year in Rice, Stevens and Yellow Medicine counties. That means those residents will only be able to get original Medicare, including a Medigap policy if applicable, or a different form of coverage via private insurers called Medicare Cost plans that are available in only certain Minnesota counties.

Whereas beneficiaries can enroll in Medicare Advantage, Medicare Cost and Part D plans through the Medicare Plan Finder website, that’s not possible for Medigap plans, said Kelli Jo Greiner, the Medicare program manager for the Minnesota Board on Aging.

In addition, “the Medicare Plan Finder ... only provides an estimate of costs,” says Blue Cross of Minnesota, which the largest Medigap insurer in Minnesota. “They’ll need to go directly to the plans to get complete pricing and enroll.”

The annual election period for Medicare Advantage and Part D plans runs from Oct. 15 through Dec. 7. People can survey options via the Medicare Plan Finder at Medicare.gov, or by calling 1-800-MEDICARE. Help over the phone also is available from Minnesota Aging Pathways (formerly the Senior LinkAge Line) at 800-333-2433. The statewide service also has open enrollment information on its website.

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