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January 26.2026
2 Minutes Read

Trust in Healthcare: How Hospital-Owned Medicare Advantage Plans are Changing the Game

Medicare Part C form close-up on clipboard with pen

Hospitals Enter the Medicare Advantage Space

As the need for affordable healthcare options surges, some hospitals are stepping into the insurance field with their own Medicare Advantage plans. Facing challenges from traditional insurers, these healthcare institutions offer tailored plans that prioritize the needs of patients, evidenced by the experience of retired worker Larry Wilkewitz. After struggling with a commercial plan for years, he switched to Peak Health, a Medicare Advantage plan introduced by the West Virginia University Health System. Wilkewitz highlighted that this plan delivered additional benefits crucial for his treatment while providing a more personal touch.

The Rise of Hospital-Owned Plans

Despite hospital-owned plans constituting a small portion of the overall Medicare Advantage market, their popularity is on the rise. Enrollment for these plans has increased significantly, with Peak Health tripling its numbers from the previous year. This trend corresponds with a broader movement where 54% of eligible Medicare beneficiaries opted for Advantage plans last year, according to the Kaiser Family Foundation. Hospitals leverage their established relationships within their communities, making it easier for patients to trust these new insurance offerings.

Challenges in the Insurance Landscape

While more hospitals are launching these plans, success is not universal. MedStar Health, for instance, faced financial losses and had to shut down its Medicare Advantage plan. The complexities of managing insurance operations often deter some healthcare providers. However, other notable systems like Kaiser Permanente have found success with extensive offerings. In 2023, fresh initiatives like those from UCLA Health have introduced plans tailored to meet community needs, particularly in underserved rural areas.

Significance of Reliability and Trust

With many Medicare Advantage enrollees facing disruptions due to contract disputes between insurers and healthcare providers, hospital-owned plans present an opportunity for stability. For example, over 3.7 million beneficiaries were forced to navigate new insurance options after their doctors dropped out of their plans. Community trust plays a vital role in the uptake of these new options, as patients are often more comfortable with their healthcare providers managing their insurance.

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