January 27, 2026  –Louisiana has approved a major financial commitment to maintain stability in its Medicaid managed care system, extending most of its managed care organization contracts through the end of 2026 at a cost exceeding $17 billion. The decision, announced by the Louisiana Department of Health, continues coverage for the majority of the state’s Medicaid population under the Healthy Louisiana program while setting the stage for a transition involving one plan.

Five of the state’s six Medicaid managed care organizations received full one-year extensions through December 31, 2026. These plans include Aetna Better Health of Louisiana, AmeriHealth Caritas Louisiana, Healthy Blue, Humana Healthy Horizons in Louisiana, and Louisiana Healthcare Connections. Each of these plans will continue serving beneficiaries under the same managed care framework that has been in place since early 2023.

UnitedHealthcare Community Plan, the sixth managed care organization participating in Healthy Louisiana, received a shorter extension. Its contract was extended only through March 31, 2026. State officials said approximately 300,000 members currently enrolled in UnitedHealthcare’s plan will be reassigned to a different managed care plan by that date. After reassignment, beneficiaries will have the option to change plans if they choose.

The Healthy Louisiana managed care contracts were originally awarded in 2022 and became effective on January 1, 2023. The contracts were structured with an initial three-year term, followed by a single two-year extension option. Together, the managed care plans serve roughly 1.5 million Medicaid beneficiaries across the state, including children, older adults, people with disabilities, and low-income families.

State lawmakers approved the contract extensions in November 2025, according to local reports. The value of the 2026 extension contracts is approximately $2.2 billion higher than the previous year. During that period, the average monthly premium paid to managed care plans increased from $514 per member to $563, reflecting higher overall program costs.

The decision not to grant UnitedHealthcare a full extension followed recent legal developments involving pharmacy benefit management practices. In November 2025, the Louisiana First Circuit Court of Appeals reversed an earlier decision related to a state complaint against the pharmacy benefit management units of UnitedHealthcare and CVS Aetna. The state alleged that the PBMs had overcharged Medicaid for prescription medications, violating state law. The Louisiana attorney general’s office indicated that until the companies achieved compliance, they would not be eligible for full contract extensions.

Aetna later confirmed that its contract had been extended through the end of 2026, though no additional details were provided regarding any changes required to address the state’s concerns.

The status of UnitedHealthcare’s contract shifted several times in December. On December 12, state officials announced plans to cancel the contract effective January 1, 2026. Less than a week later, the department reversed course and approved a short-term extension through March 31, 2026.

Louisiana Department of Health Secretary Bruce Greenstein said the limited extension was intended to protect beneficiaries during the transition period. “This extension gives us more time to take an even more thoughtful approach to transitioning members to new plans,” Greenstein said. “Continuity of care is our highest priority so members can continue accessing their services without disruption.”

State officials have said they will continue working with managed care plans to ensure a smooth reassignment process and minimize any impact on Medicaid members as the transition moves forward.