Florida and Texas

Florida and Texas are where Medicare’s scale problem is most visible. Florida has approximately 4.8 million Medicare beneficiaries. Texas has approximately 4.2 million. Together they account for roughly 14 percent of the entire Medicare population. Both states have highly competitive MA markets in their urban centers. Both face structural fragmentation between those urban markets and the rural, exurban, and border populations that represent a different Medicare reality entirely. Both have refused Medicaid expansion, narrowing the dual eligible pipeline and leaving their low-income Medicare populations with less Medicaid protection than equivalent populations in expansion states. And both are now at the center of the MA profitability reckoning that is producing plan exits, benefit contractions, and forced disenrollment at rates not seen since the program began its two-decade growth trajectory.

Florida: MA Profitability at Scale

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Florida’s MA penetration rate is approximately 58 percent, the highest among large states and among the highest nationally. The state had 611 MA plans available in 2026, up slightly from 592 in 2025, a number that conceals significant churn underneath. Southeast Florida, the Miami-Dade, Broward, and Palm Beach corridor, has the densest MA competition in the country. It also has the most documented MA profitability problems as rate compression has played out in a market where plan density drove benefit richness to levels that revenue can no longer sustain.

Humana has historically held the dominant Florida MA position. That dominance is eroding. Humana exited parts of Florida in 2025 and continued county-level exits in 2026 as part of a national footprint reduction that dropped its coverage from 89 percent of U.S. counties to approximately 85 percent. The company expects approximately 500,000 fewer MA members nationally, with Florida among the most affected states. Humana’s Star Ratings dropped from 94 percent of members in 4-star-or-above plans in 2024 to just 25 percent in 2025, a collapse that reduced quality bonus payments and the rebate dollars available to fund the supplemental benefits that attracted members in the first place.

UnitedHealthcare terminated its local PPO in Dade and Broward counties for 2025. For 2026, additional carriers terminated PPO products in Southeast Florida. At least one carrier serving the Florida MA market exclusively exited the Medicare Advantage market entirely in 2026. The forced disenrollment rate nationally is projected to reach 10 percent for 2026, representing approximately 2.9 million enrollees who could face coverage termination. Florida, with its outsized MA enrollment, accounts for a disproportionate share of that disruption. PPO enrollees represent nearly half of disenrolled individuals nationally, and Southeast Florida’s PPO market has been among the most aggressive in benefit design.

The plan landscape in Southeast Florida remains competitive by count but is contracting in benefit value. Milliman’s analysis of 2026 MA plan offerings found that non-Medicare-covered benefit values decreased by $10 PMPM nationally, driven primarily by reductions to dental benefits and OTC benefit card offerings. Part D deductibles rose more than 60 percent across Enhanced Alternative plans. The IRA’s Part D redesign narrowed the bounds within which plans can differentiate supplemental drug coverage. For Florida beneficiaries accustomed to $0-premium plans with rich dental, vision, OTC, and transportation benefits, the 2026 plan year represents a noticeable step-down in what MA delivers.

Freedom Health, a Florida-focused carrier, leads the state’s MA market with a 5.0 Part C Star Rating for 2026. CarePlus, a Humana subsidiary, maintains a strong regional position in Tampa Bay, Orlando, and South Florida. HealthSun, Devoted Health, and other regional and startup carriers continue to compete in Southeast Florida, though the profitability math is tightening for everyone.

Florida has not expanded Medicaid. The dual eligible pipeline is narrower than expansion states, meaning fewer low-income Medicare beneficiaries have Medicaid coverage to wrap around their Medicare benefits. D-SNPs are available in Southeast Florida and the Tampa corridor but limited in the panhandle and rural north Florida. The Florida panhandle is demographically and structurally more similar to Alabama and Mississippi than to Southeast Florida: rural, low-income, high dual eligible rates relative to the population, and very limited MA plan competition. A beneficiary in Escambia or Bay County faces a fundamentally different Medicare landscape than a beneficiary in Broward County, despite living in the same state.

The language access dimension in Southeast Florida is among the most complex in the country. The Medicare population includes large Haitian Creole, Spanish, and Portuguese-speaking communities. CMS language access requirements apply, but the compliance gap between what plans are required to provide and what beneficiaries actually receive in multilingual navigation, translated materials, and interpreter services is wider in Southeast Florida than the regulatory framework acknowledges.

Texas: WISeR, Non-Expansion, and the Border

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Texas is the second-largest Medicare state and one of six WISeR pilot states beginning January 2026. The prior authorization burden on Original Medicare now applies in a state where 4.2 million beneficiaries generate one of the largest FFS Medicare claims volumes in the country. The Texas provider community response to WISeR has been bifurcated. Large hospital systems in Houston and Dallas, including MD Anderson, Memorial Hermann, Baylor Scott & White, and UT Southwestern, have sophisticated revenue cycle operations with dedicated staff to manage prior authorization workflows. Rural and border providers do not. The WISeR implementation burden falls disproportionately on the small practices and critical access hospitals that serve the populations with the highest clinical need and the least administrative capacity.

Texas is the largest non-expansion state. The Medicaid eligibility threshold is among the lowest in the country, effectively limiting full Medicaid coverage to pregnant women, children, and people with severe disabilities. The dual eligible population in Texas is narrower than it would be in an expansion state. The LIS-only and near-poor Medicare population in Texas, the population documented in MCR-10.01, has less Medicaid protection than equivalent populations in California or New York. The coverage gap between Medicaid eligibility and LIS eligibility is wider in Texas than in any expansion state, leaving millions of low-income Texas Medicare beneficiaries navigating cost-sharing without the MSP and QMB protections that their counterparts in expansion states receive.

The Rio Grande Valley is the most policy-dense Medicare market in Texas. McAllen, Laredo, and Brownsville have the highest dual eligible concentrations in the state. The population is predominantly Spanish-speaking. MA market competition in the Valley has historically been intense, driven in part by heavy Third-Party Marketing Organization activity targeting the large Spanish-speaking dual eligible population. The Valley has been a focus of CMS marketing fraud investigations due to TPMO lead generation practices that exploited language barriers and beneficiary confusion about plan switching. The DOJ enforcement actions and CMS regulatory tightening on TPMO activity documented in Series 4 are directly relevant to this market.

D-SNP development in the Valley is moderate. The distinction between FIDE SNPs and coordination-only D-SNPs matters here because the Valley’s dual eligible population has significant LTSS needs that coordination-only models do not address with the same depth. HIDE SNPs, with their behavioral health integration mandate, are relevant to a border population with elevated rates of depression, substance use disorder, and trauma-related conditions.

The Texas MA market outside the Valley is fragmented across five distinct competitive zones. Houston has the deepest health system competition and the most developed MA market. Dallas-Fort Worth has strong national carrier presence and a growing provider-sponsored plan sector. San Antonio has a significant military retiree population that creates TRICARE-to-Medicare transition dynamics. Austin’s MA market is smaller and more concentrated. Rural Texas, including east Texas, west Texas, and the Panhandle, has very limited MA plan availability and faces the same provider shortage constraints as rural areas across the South and Mountain West.

Medicaid Policy and Dual Eligible Impact

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Florida and Texas are both positioned to implement Medicaid work requirements early under OBBBA. Both states have signaled interest in work requirement programs, and the OBBBA framework provides the federal authorization they were previously seeking through Section 1115 waivers. The aged and disabled populations are exempt from work requirements by statute, but establishing exemption status requires documentation and administrative processing that low-income elderly beneficiaries may not complete. The documentation burden to prove exemption is itself an enrollment barrier, even for populations that are legally exempt.

OBBBA Medicaid cuts affect both states through federal funding reductions that reduce the fiscal capacity of state Medicaid programs. In non-expansion states, the Medicaid program is already smaller and less well-funded than in expansion states. Federal cuts compound the resource constraints. For dual eligible beneficiaries, the cascade is familiar: Medicaid coverage disruption produces loss of D-SNP eligibility, loss of Part D cost-sharing protection through LIS, and loss of MSP coverage, all triggered by a single administrative event.

Equity Dimensions

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The Black Medicare population in Florida is concentrated in Jacksonville, Central Florida, and the I-4 corridor. In Texas, the largest concentrations are in Houston, Dallas, and the east Texas piney woods. The HCC coding gap and supplemental benefit access disparities documented in MCR-10.02 apply with particular force in both states because the populations with the highest coding gaps are concentrated in markets where plan exits and benefit contractions are most active.

The Latino Medicare population across both states is the largest in the country by combined count. Florida’s Cuban, Puerto Rican, and Central American Medicare populations have different health profiles, language needs, and plan preferences. Texas’s Mexican-American border population has distinct characteristics from the urban Latino populations in Houston and Dallas. One-size-fits-all language access compliance does not address the linguistic and cultural variation within the Latino Medicare population in either state.

Rural equity across both states follows the national pattern but at Southern scale. The panhandle, east Texas, and west Texas rural populations are among the most underserved Medicare populations in their respective regions, facing simultaneous provider shortages, MA plan absence, limited SHIP counseling, and high dual eligible rates without the Medicaid expansion infrastructure that would partially address the gap.

Related Reading

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MCR-02_06 State-by-State Rate Impact Analysis: Top 20 Markets MCR-04_01 Is MA Still Worth It? The Strategic Recalculation for Insurers MCR-01_03 WISeR: Prior Authorization Comes to Traditional Medicare