UCare shutdown anything but smooth, affected customers claim

UCare informs customers of shutdown

UCare started alerting customers last week that they will need to transition to a different plan before the end of the year, leaving thousands of members looking to find new Medicare supplement coverage.

(FOX 9) - Thousands of UCare customers are now scrambling to find new healthcare plans before the end of the year after the company's promise of a smooth shutdown and transition to Medica hit another snag.

Customers left scrambling

What we know:

UCare confirmed that about 2,500 members will need to find new Medicare Supplement coverage before Jan. 1, 2026.

Anita Kangas was first alerted by her insurance broker last week and received a voicemail message Friday confirming her coverage will end. However, she did not receive the official termination letter needed to obtain coverage from a different carrier until this week.

Impacted clients need to find new insurers by Jan. 1 to avoid a gap in coverage.

"I’m currently recovering from a total knee replacement. I have many appointments for physical therapy, follow ups for the next three months. And now, I’m not sure if I have insurance," said Kangas.

What they're saying:

UCare said they began notifying members and brokers through phone calls, mail and emails as soon as they finalized the timeline for exiting the Medicare Supplement market. 

That leaves members only a few business days scattered around the holiday season to make the switch.

Kangas said she was initially told her Medicare Supplement coverage would not be impacted after UCare announced it was shutting down and transferring the bulk of its business to Medica.

"I think the people of Minnesota deserve to know what’s going on. Who is responsible. And who is going to pay my medical bills in January if I don’t have insurance," said Kangas.

When UCare and Medica announced the acquisition in November, the companies promised a smooth transition for existing members.

That hasn't happened.

Earlier this month, the Minnesota Department of Health (MDH) filed a petition with the court to place UCare into receivership. 

"It allows the regulator to take control of the company to protect consumers, stabilize operations and determine the best path forward," an MDH spokesperson said in an email last week.

As part of that court filing, MDH revealed UCare was forced earlier this year to pursue an acquisition or merger because its financial outlook was so dire that the continuance of its business would be "hazardous to the public or its insured."

By the numbers:

After reporting a record surplus in 2022, UCare lost half-a billion dollars by the end of 2024.

UCare met with MDH and the Department of Commerce in August and reported that without an acquisition, it would not be able to pay its debts after the New Year, according to court filings. 

The proposed acquisition by Medica, which still needs state approval, was supposed to provide some stability for UCare customers.

Instead, thousands are now scrambling to find new coverage over the holidays.