A recent Health System Pulse Survey from Alvarez & Marsal indicates that many U.S. health systems are reconsidering their participation in Medicare Advantage as financial and operational pressures increase. The study gathered
According to the survey, 60% of respondents reported declining reimbursement, while 74% cited rising claim denials and 52% noted payment delays, all of which are adding operational strain and eroding margins. Additionally, more than half of respondents reported higher-than-expected patient utilization, further increasing costs for providers participating in value-based arrangements.
The findings suggest that health systems are shifting toward a more selective approach to payer relationships and contract participation. The report notes that “MA is no longer a growth strategy; it is a capital allocation and operating model decision,” highlighting a shift in how executives assess partnerships and financial exposure. Leaders are increasingly narrowing the number of Medicare Advantage plans they work with, renegotiating contract terms, and exiting arrangements that fail to support sustainable margins.
Survey results also indicate that organizations are investing in operational improvements such as stronger revenue cycle management, denial prevention, and more precise coding to stabilize finances. Overall, the analysis concludes that disciplined portfolio management, rather than broad participation, will define how health systems maintain profitability and manage risk in the evolving Medicare Advantage landscape.