A significant shift is underway in Minnesota’s healthcare landscape as UCare, based in Minneapolis, announced that Medica will assume control of select plans as UCare winds down its operations. This decision follows UCare’s earlier cutback of Medicare Advantage plans, a move attributed to rising operational costs.
In their joint statement, UCare expressed its commitment to facilitating a seamless transition for its members, stating that the organization has been actively seeking partnerships with a nonprofit entity that shares its mission of community-focused care. The impending transaction between UCare and Medica, while still pending regulatory approval, is expected to be finalized early next year.
Hilary Marden-Resnik, president and CEO of UCare, emphasized the collaborative effort between the two organizations, noting their nearly century-long experience in the healthcare sector and shared dedication to serving vulnerable populations. “This is a significant agreement that will enable us to preserve access to coverage for Minnesota’s most vulnerable members,” she stated.
UCare reassured its members that those enrolled in its plans for the 2025 calendar year will retain their coverage, with eligibility for new enrollments in coverage through either UCare or Medica. Individuals participating in UCare’s 2026 Medicaid and Individual and Family Plans will also continue receiving services without interruption.
Lisa Erickson, CEO of Medica, highlighted the focus on continuity of care during the transition period. “Throughout the coming weeks and months, continuity of care will be our greatest focus, as we ensure that UCare members feel cared for and confident in their ability to receive the care they need,” she said.
To manage the transition and uphold service continuity for approximately 25,000 enrollees in UCare’s Minnesota Senior Health Options and integrated Medicare and Medicaid Special Needs Basic Care programs, the Minnesota Department of Human Services is developing a detailed enrollment plan. John Connolly, deputy commissioner and state Medicaid director, acknowledged the potential for confusion surrounding such announcements but reassured that the process would largely be smooth for most enrollees.
UCare, founded over 40 years ago, currently serves more than 300,000 members in Minnesota and western Wisconsin. However, the nonprofit experienced a substantial financial downturn, reporting a loss of $120 million in 2023, a stark contrast to the $321 million net income it achieved the previous year. In comparison, Medica, headquartered in Minnetonka, has over 1.4 million members across nine states, reporting a net income of $28 million in 2023.
While the leadership structure will see Erikson continue as CEO of Medica post-transition, details regarding the impact on UCare’s employees remain undisclosed.
