UCare is in the throes of its state takeover in Minnesota, with health systems and now former employees voicing concerns over the insurer’s rehabilitation.
The insurer posted an operating loss of $504 million in 2024 and shared plans to exit the Medicare Advantage market. UCare also scaled back its Medicaid service area, affecting 88,000 beneficiaries.
As of December, UCare planned to lay off about 250 employees — and possibly another 450 — and agreed to hand off its remaining Medicaid and ACA businesses to Medica. Minnesota also assumed control of UCare, meaning the state would manage the organization’s finances and assets.
Here are four notes on where UCare’s shutdown now stands:
1. A group of former UCare employees shared a letter with Becker’s on Feb. 3 alleging UCare misled members and regulators and had conflicts of interest in its business. The letter also said “executives of color positioned near the C-suite carried an unspoken expiration date.” The employees called UCare’s situation a “leadership failure.” When contacted about the letter, the state of Minnesota said it could not comment on ongoing litigation. UCare also declined to comment.
2. The state estimates UCare owes providers $900 million but could retain $84 million in equity, according to a Feb. 3 court filing.
3. On Jan. 30, Minnesota Department of Health Commissioner Brooke Cunningham, MD, objected to Minneapolis-based Fairview Health Services‘ attempt at intervention. Fairview previously alleged more than $100 million in unpaid obligations.
4. Along with Fairview, Minneapolis-based Hennepin Healthcare, Rochester, Minn.-based Mayo Clinic and Minneapolis-based Allina Health have also expressed interest in the proceedings, according to court records.
