After facing significant financial strain due to labor shortages, inflation, and the COVID-19 pandemic, the health care industry is beginning to recover. Profit pools are expected to increase at a 7 percent compound annual growth rate (CAGR), from $583 billion in 2022 to $819 billion by 2027.
Medicare Advantage
This segment shows strong performance, driven by an increasing population of individuals eligible for Medicaid and Medicare. Enrollment in Medicare Advantage is expected to grow at a 5 percent annual rate from 2022 to 2027.Meanwhile, hospitals are leaving Medicare Advantage networks due to lower payout rates, causing insurance companies to change coverage options. Humana, the second-largest Medicare Advantage insurer, is preparing to lose about 200,000 members as it plans to limit benefits and exit some markets in 2025.
