Minnesota is rehabilitating UCare, according to a Dec. 17 court filing.
The state will take over the insurer’s assets and finances. While providers cannot collect payment from UCare during this time, provider contracts could be modified under the state’s supervision. The court must approve contract changes, and reductions in provider compensation cannot last for more than 60 days.
The rehabilitator can also stay any lawsuits affecting UCare.
Minnesota regulators have been petitioning for a state takeover, The Minnesota Star Tribune reported Dec. 9.
Over the past few months, UCare has started winding down operations and preparing to transfer ACA and Medicaid assets to Medica, another carrier. UCare is laying off 250, while 450 roles are still up in the air.
UCare had an operating loss of $504 million in 2024 and shared plans to abandon the Medicare Advantage market. After missing a contract execution deadline, CMS formally terminated UCare’s MA contracts in the fall.
