Minnesota regulators are seeking court approval to take control of UCare, the Minnesota Star Tribune reported Dec. 9.
The Minnesota Department of Health filed a petition in state court seeking to place UCare in “rehabilitation” status, which would give the state authority over the nonprofit as it winds down operations.
The filing revealed that the state placed UCare under administrative supervision in September due to concerns about its financial condition, and directed the insurer to pursue an acquisition or merger, according to the report.
The court action does not change UCare’s pending deal with Medica. In November, Medica announced plans to purchase certain contracts and assets from UCare, including its Medicaid and ACA businesses covering more than 300,000 people. That deal is expected to close in the first quarter of 2026.
UCare has faced mounting financial pressures over the past year. The nonprofit reported an operating loss of $504 million in 2024 amid rising costs in its Medicare Advantage and Medicaid businesses.
The insurer decided earlier this year to exit the MA market entirely, a move affecting about 158,000 members in Minnesota and western Wisconsin, where UCare held 26% market share as the second-largest MA carrier. CMS formally terminated UCare’s MA contracts in September after the company missed an Aug. 31 contract execution deadline.
UCare also withdrew from 11 counties in Minnesota where it offered Medicaid plans, affecting 88,000 beneficiaries.
