MW UnitedHealth is dropping a million seniors from Medicare Advantage as it aims to restore its 'swagger'

By Neal Shah

America's largest insurer is making sweeping changes to its Medicare Advantage plans to improve profit margins

UnitedHealth Group is dropping some of its Medicare Advantage plans.

UnitedHealth Group announced last month that it plans to drop 1 million Medicare Advantage members. Two weeks later, at a UBS healthcare conference, Wayne DeVeydt, the company's chief financial officer, said many of the changes UnitedHealth is making will allow it to "get back to the swagger the company once had."

"Swagger." I guess that's what some call affecting the lives of 1 million senior citizens. Talk about tone-deaf.

Through my work as a healthcare researcher and innovator, I directly see thousands of patients across the U.S. struggling to utilize the health-insurance system, which routinely fails them at the darkest moments in their lives. I've closely followed UnitedHealth since the CEO of its insurance division, Brian Thompson, was shot and killed last December. In the social-media response to his death, hundreds of thousands of Americans clicked the laughing emoji on their feeds, mocking health insurers while sharing their own frustrations with the system. Less than a year later, the company is abandoning a million elderly Americans to protect its margins.

UnitedHealth's stock $(UNH)$ has lost approximately 45% of its value in a year. Its insurance margins crashed from 5.6% to 2.1% in the third quarter. Optum Health - the company's provider arm - saw its margins plummet from 8.3% to 1% during the same period. And somewhere in all that wreckage, $16 billion disappeared. That's half of the company's forecasted cash flow - gone, apparently with no credible explanation.

The company has spent about $118 billion over five years buying competitors and rolling most of them into Optum. There are now $165 billion in intercompany revenue flows between subsidiaries, making it impossible to tell where the real value is.

So the company did what monopolies often do when the numbers turn bad: It made cuts that affect its customers. UnitedHealth now plans to exit unprofitable Medicare Advantage and Affordable Care Act products, raising rates on ACA plans by about 26% alongside other health insurers. They're not fixing the business model, but rather purging the patients who make it look broken.

UnitedHealth's profit target

When your solution to a drop in profits is abandoning a million elderly people, maybe the problem isn't the patients.

In recent months, the Department of Justice has deepened its antitrust investigation and is now looking into Optum's vertical-integration strategy. As of May, Optum controlled 10% of America's physicians. That means one in 10 doctors working today answers, ultimately, to an insurance company.

Think about what that means. Your doctor's employer is also your insurer. The company that decides whether to approve your surgery also employs the surgeon. And when that company decides you're not profitable enough, they may deny your claims - or they may just drop you entirely.

Major nonprofit hospital systems like HealthPartners have already left UnitedHealth's network, citing denial rates up to 10 times higher than other insurers they work with. Elite hospitals like the Mayo Clinic and Johns Hopkins Medicine have also showed UnitedHealthcare's Medicare Advantage plans the door. And now Optum is trimming 200,000 more people to return to tightly controlled physician networks.

That's corporate speak for "We only want patients we can really profit from."

A Senate investigation last year found that UnitedHealthcare's post-acute-care denial rate jumped from 8.7% in 2019 to 22.7% in 2022 - coinciding with the implementation of an artificial-intelligence tool called nH Predict. These are the most vulnerable patients. These are elderly folks who need rehabilitation in order to go back home instead of dying in institutions.

Now some of those same patients are being told their plans don't exist anymore, because they weren't profitable enough.

In his comments at the UBS conference, UnitedHealth's DeVeydt was explicit: The company is pricing for a 10% medical-cost trend to protect margins. Product design, he called it. As if health coverage is a widget the company has engineered rather than a lifeline it is cutting.

The antitrust question

Sen. Elizabeth Warren, a Massachusetts Democrat, has called for aggressive action, including a possible breakup of UnitedHealth's empire. Earlier this month, President Donald Trump referred to insurers "money sucking" and proposed bypassing them entirely. Both parties finally agree the industry is parasitic. The question is what happens next.

Breaking up UnitedHealth would mean separating insurance from Optum's physician groups, which would end the conflict that occurs when your insurer employs your doctor and can drop both of you to improve margins. It would mean eliminating the many billions of dollars in intercompany flows that make oversight impossible.

The U.S. government broke up AT&T in 1982 because a company owning phone lines and telephones was anticompetitive. Healthcare is more essential than telephone service. One million elderly Americans are finding that out the hard way.

After Thompson's death last year, private security firms reported a surge in inquiries from executives who were suddenly worried about their safety. You might have expected that fear to produce a period of reflection, maybe even reform. Yet only months later, UnitedHealth is boasting about regaining its "swagger" while discarding some seniors from their Medicare Advantage plans. The moment of reckoning has passed. The soul-searching has evaporated. It's back to business as usual.

Writer Jia Tolentino said the mockery of Thompson's death revealed that many Americans think of UnitedHealthcare "as a company that itself has achieved these billions and billions and billions of dollars of profits in not provisioning health care but indirectly provisioning death."

This week proved her right. One million older Americans are losing their plans entirely because they cost too much to remain in the insurance pool.

Should we break up UnitedHealth? Not for revenge, but for necessity and before restoring "swagger" becomes the industry's euphemism for deciding which Americans deserve to survive.

Neal K. Shah is a healthcare researcher specializing in artificial intelligence. He is the principal investigator of the Johns Hopkins YayaGuide AI Innovation project and co-principal investigator of the University of Pennsylvania's CounterforceAI project. Shah also serves on North Carolina's Steering Committee on Aging. He is CEO of CareYaya, chair of Counterforce Health and the author of Insured to Death: How Health Insurance Screws Over Americans - And How We Take It Back".

-Neal Shah

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November 19, 2025 10:56 ET (15:56 GMT)

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