Providence to end most of its health insurance business

By AMELIA TEMPLETON/Oregon Public Broadcasting

Providence will shutter its health insurance business at the end of the year, with a few exceptions, the nonprofit announced Wednesday.

Providence currently provides health insurance coverage to about one in 10 Oregonians, or more than 420,000 people in the state. Its insurance plans also cover about 19,000 people across Washington, California and Montana.

While there are no immediate changes to health benefits, Providence said many of those who use their plans will have to transition to another insurer starting in 2027.

The departure of one of the largest nonprofit players in Oregon’s health insurance market is a new challenge at a time when the cost of buying health insurance is rising and the number of uninsured Oregonians is likely to go up as federal cuts to Medicaid take effect.

Providence, which operates more than 50 hospitals and 1,000 clinics across the West, has been laying the groundwork for its exit from the insurance business over the past year, as part of a major reorganization and effort to return to profitability.

Last year, Providence shifted its benefits administration for more than 100,000 of its own employees to a competitor, Aetna, and laid off some of its insurance plan staff. In March, Providence’s Chief Financial Officer Greg Hoffman said he was looking for opportunities to sell the Providence Health Plan.

On Wednesday, Providence said most of its insurance business does not have a buyer and will wind down.

In an email to Providence staff, CEO Erik Wexler said changes to state and federal regulation and increased consolidation in the health care insurance industry have made it difficult for regional, nonprofit health plans like Providence’s to survive.

Wexler said Providence has found an unspecified potential partner to take over one part of the business, a Medicare Advantage plan known as Providence Health Assurance.

Medicare Advantage plans are popular privatized Medicare plans that often offer more generous benefits than traditional Medicare, like eye care and dental coverage, but may place more restrictions on which doctors their members can see. Providence Health Assurance provides health care to to over 64,000 people on Medicare, primarily in Oregon. The federal health insurance is for those 65 and over and people with disabilities.

According to Wexler, the agreement would help people currently enrolled in Providence’s Medicare Advantage plan continue to see Providence providers.

Other people who will lose their Providence insurance at the end of 2026 may still be able to find coverage in 2027 that will allow them to continue to see their Providence doctors, Wexler said.

“Our hospitals and clinics will continue to be available through other insurance plans, and we are working to be included in additional networks so patients have options to choose plans that include Providence,” he wrote.

In Oregon, Providence has been a particularly important player selling insurance to people and small businesses shopping for coverage on the marketplace set up by the Affordable Care Act. The Providence Health Plan has been available in every county statewide and enrolls more Oregonians than most other plans offered on the ACA, according to data published by the state.

Providence will no longer offer individual or family plans on or off the ACA insurance exchange in 2027. Current coverage will remain in place for people enrolled in Providence plans through the end of 2026.

The health plan is also ending is coverage of public employees through the Public Employees’ Benefit Board.

Even prior to Providence’s announcement that it was pulling out, state regulators said they expect consumers will pay more for ACA plans next year, due to the expiration of federal subsidies, the impact of tariffs and decreased enrollment numbers.

A spokesperson with the Oregon Department of Consumer and Business Services said the agency is trying to provide as much stability to the ACA marketplace as it can, but said that the lack of extended federal subsidies was working against the individual insurance market.

“We would defer to Providence for any further comment to their specific decision,” said spokesman Jason Horton.

Many Oregon employers, including Intel, have offered Providence health plans to their employees. According to Wexler’s email, Providence will honor its existing contracts with those employers but will no longer renew them when their terms expire.

Wexler wrote that Providence is also working on a plan to transfer its Medicaid program, which covers 58,406 low-income Oregonians, to another organization.

This story was originally published on May 20, 2026 by Oregon Public Broadcasting.