Highlights

• Louisiana ended UnitedHealthcare’s Medicaid contract, affecting 344,614 residents across the state
• Members have less than three weeks to transition before the contract expires on January 1, 2026
• The state kept Aetna’s contract after settlement talks with CVS Health
• The decision stems from lawsuits over pharmacy benefit managers and alleged contract violations
• The state will automatically move affected residents to one of five remaining insurance plans

Louisiana Ends UnitedHealthcare Medicaid Contract, Forcing 344,614 Residents to Switch Plans

State pulls $4.2 billion healthcare contract three weeks before it expires, tied to ongoing legal battles over pharmacy costs.

LAFAYETTE, La. (KPEL News) — Louisiana health officials cut ties with UnitedHealthcare just weeks before the new year, forcing 344,614 Louisiana residents to find new Medicaid coverage.

The Louisiana Department of Health won’t renew UnitedHealthcare’s contract when it expires December 31, giving members less than three weeks to switch to other insurance providers.

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State lawmakers didn’t see it coming. They approved the contract extension less than two weeks before Louisiana Medicaid Director Seth Gold sent UnitedHealthcare executives a letter on December 2 announcing the termination. The state health department said it will “begin the transition process” to move members to other contracted Medicaid plans by January 1, 2026.

What Louisiana Families Need to Know About the Contract Termination

UnitedHealthcare had the second-largest Medicaid contract in Louisiana, worth about $4.2 billion for the 2026 calendar year. The contract covered 344,614 Louisiana residents across all 64 parishes, according to mid-November data from the Louisiana Department of Health.

Louisiana runs its Medicaid program through managed care organizations that handle health insurance for low-income families, children, pregnant women, people with disabilities, and other eligible residents. With UnitedHealthcare out, five companies will now split the state’s 1.53 million Medicaid members.

Those five companies are AmeriHealth Caritas, Elevance Health (Healthy Blue), Humana, Louisiana Healthcare Connections, and Aetna Better Health of Louisiana. Health Secretary Bruce Greenstein said these companies can handle the new members, though they have less than three weeks to make it happen.

Why Louisiana Kept Aetna But Dropped UnitedHealthcare

The Louisiana Department of Health planned to drop both UnitedHealthcare and Aetna Better Health, according to the Louisiana Illuminator. That would have hit 488,500 Louisiana Medicaid recipients.

But the state changed its mind on Aetna after settlement talks with CVS Health, Aetna’s parent company. A December 9 letter from Gold to Aetna confirmed the renewal: “After discussions between the State of Louisiana and Aetna Better Health of Louisiana, LDH will renew its contract with Aetna as a Medicaid Managed Care Organization for the State of Louisiana for calendar year 2026.”

Aetna’s two-year contract runs through June 30, 2027, and is worth $2.59 billion. The company covers 165,163 Louisiana Medicaid members statewide.

Legal Battles Behind the Contract Decisions

Attorney General Liz Murrill pointed to ongoing lawsuits and contract violations as reasons for the decision. She told reporters the companies “are violating the contracts and have refused to provide us with [documents] we have requested.”

Murrill has taken aim at pharmacy benefit managers owned by both healthcare companies. In June 2025, she filed three lawsuits against CVS, claiming its pharmacy benefit manager CVS Caremark squeezes out Louisiana’s independent pharmacists. She also accused CVS of using customer information to fight state legislation.

The fight with UnitedHealthcare goes back further. When he was attorney general in 2022, current Governor Jeff Landry sued pharmacy benefit manager OptumRx and UnitedHealthcare, both owned by UnitedHealth Group. The lawsuit claimed they overcharged Louisiana’s Medicaid program for prescription drugs.

The Louisiana First Circuit Court of Appeal sided with UnitedHealthcare in that case on November 21 — one day after state lawmakers approved the company’s contract extension. A little over a week later, the health department told UnitedHealthcare the deal was off.

Timeline and Transition Process for Louisiana Residents

Louisiana residents with UnitedHealthcare Medicaid coverage don’t need to do anything right now. The Louisiana Department of Health will automatically move members to one of the five remaining managed care organizations. The state expects to finish the transition by January 1, 2026.

Watch for notices in the mail explaining your new coverage. The state lets Medicaid members change plans during open enrollment periods, but the automatic reassignment will happen first to keep you covered.

Louisiana’s Medicaid program, known as Healthy Louisiana, covers families with children, pregnant women, people with disabilities, and adults added through Medicaid expansion. Call Louisiana Medicaid customer service at 1-888-342-6207 if you have questions about the transition.

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What Happens Next for Louisiana’s Medicaid Program

The contract termination is a big shift in Louisiana’s Medicaid landscape. State lawmakers said they were caught off guard, noting health officials gave no hint of problems when they testified before the Joint Legislative Committee on the Budget on November 20.

At that hearing, Greenstein and other health department officials pushed to extend all six Medicaid contracts, including UnitedHealthcare. Greenstein even defended keeping multiple companies, telling legislators that “each of the plans brings a different way of envisioning how to engage patients with certain medical complexities.”

Louisiana’s Medicaid budget is about $22 billion in the current fiscal year, with $16.6 billion coming from federal funds. The managed care contracts are the largest government contracts in Louisiana history, according to state health officials.