Jefferies raises Medicaid attrition forecast for August 2026

Investing.com - Jefferies reports that Medicaid enrollment attrition rose to 0.5% in August, reversing July's near-flat performance and returning to levels seen in the first half of 2026. The investment firm's tracker, based on approximately 41% of expected data, shows August attrition exceeded the 2026 monthly average of 0.3%.

Five out of six managed care organizations experienced total enrollment attrition between 0.4% and 0.7% in August. Humana (NYSE: HUM) showed the most favorable results with approximately flat enrollment. For four of the six MCOs tracked, August total and same-footprint monthly attrition exceeded year-to-date averages.

Jefferies notes that third-quarter attrition is tracking lower than the first-half run rate, with July and August combined showing 0.2% average monthly attrition compared to 0.3% in the first half. The firm expects Centene (NYSE: CNC), Elevance Health (NYSE: ELV), Molina Healthcare (NYSE: MOH), and UnitedHealth (NYSE: UNH) to post lower quarter-over-quarter attrition in the third quarter than in the second quarter.

Several states implemented Medicaid eligibility policy changes beginning July 2026 that contributed to enrollment churn. New York eliminated continuous eligibility protections for certain adult Medicaid beneficiaries, Montana launched work and community engagement requirements on July 1, and Arkansas initiated a soft launch of its program ahead of January 2027 enforcement.

Jefferies continues to view Medicaid disenrollment as a driver of morbidity shift, with lower-acuity members more likely to lose coverage. Recent commentary from Centene, UnitedHealth, and Molina indicates that ongoing attrition remains manageable, with cost trends and Medicaid performance generally tracking expectations.

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