New enrollment data shows health insurance disruption as more volatility approaches
The health insurance sector is experiencing volatility in both the private and public sectors, according to Clarivate’s latest release of Managed Market Surveyor data reflecting enrollment as of January 2025.
Shifting enrollment is impacting health benefits and access to care for millions of Americans with the potential for more disruption to come.
Exchange enrollment grows but headwinds emerge
In the public health insurance exchange market, enrollment as of January 2025 had grown by at least 2.2 million, or about 11%, over the prior six months and by at least 2.7 million, or about 14%, over the previous year.
Centene accounted for a large share of this growth by adding more than 1 million exchange enrollees over the prior six months and expanding into Iowa’s insurance marketplace.
But exchange enrollment growth could be short-lived unless Congress extends enhanced exchange premium subsidies set to end for 2026.
The U.S. Department of Health & Human Services also recently cut exchange navigator funding, shortened the open enrollment period, ended year-round enrollment for the low-income population, and instituted new restrictions that could make enrollment more difficult (HHS news release, Feb. 14, 2025).
CVS/Aetna announced in May 2025 that the company will end exchange participation for 2026 after years of losses in the segment. Others may follow, given the evolving outlook for the marketplaces under the current U.S. administration. Aetna was a top competitor in some exchange markets such as Kansas City.
Commercial fully insured enrollment declines
Outside of exchange enrollment, health insurers’ commercial membership as of January 2025 had declined over the previous six months due to a drop of more than 2 million in fully insured lives, although self-insured enrollment increased.
Aetna reported the largest self-insured enrollment growth, while UnitedHealthcare, Cigna, and Health Care Service Corporation also saw increases.
Market share among health insurers is also being disrupted by state government employee health plan changes in several locations, including Arizona, Idaho and California.
Medicare enrollment trend disrupted
In a trend reversal, Medicare fee-for-service (FFS) enrollment grew significantly and outpaced Medicare Advantage (MA) growth. The FFS population grew by about 490,000 from July 2024 to January 2025, while MA plans added about 284,000 members.
That contrasts with a yearslong trend of steadily declining FFS enrollment countered by strong MA enrollment growth as the overall Medicare population continues to expand because of Baby Boomers aging into the program.
The more recent slowing growth of MA enrollment could be due to multiple factors: insurance premium levels, out-of-pocket costs, and limited provider networks. These factors may stem, at least in part, from government policy decisions resulting in new financial challenges for MA insurers, which respond by adjusting the cost and benefits of plans they offer Medicare enrollees.
Consolidation within the MA segment is increasing as new regulations and utilization trends have made it challenging for smaller plans to succeed financially. Expect this trend to continue for 2026 open enrollment even as major MA insurers have recently faced their own struggles due to higher medical utilization and changes to Medicare payment and quality bonus methodologies.
Numerous regional MA plans, including Blue Cross Blue Shield insurers, have left the segment, although none of the departures represented top market players, which have tended toward market contractions or selling fewer plan designs rather than full market exits.
Medicaid enrollment contraction continues with potential to accelerate
In the Medicaid sector, the trend of declining enrollment continued but slowed significantly from its previously precipitous pace triggered by states unwinding continuous enrollment provisions implemented during the COVID-19 pandemic.
As of January 2025, Medicaid enrollment decreased by about 537,000, or less than 1%, over the prior six months.
States with significant Medicaid enrollment declines include Arizona, Maryland, Florida, Indiana and Georgia, while enrollment in New York and North Carolina increased due to expansion initiatives.
Looking ahead, the budget reconciliation bill signed into law by President Trump includes work requirements for non-disabled adults, which will affect Medicaid eligibility for millions.
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