The number of Medicare Advantage Institutional Special Needs Plans (I-SNPs) is down 5% for plan year 2026, but the number of I-SNPs led by a provider organization is up.

This was one finding from an ATI Advisory analysis of Medicare Advantage (MA) plan offerings, which were the topic of an Oct. 1 webinar.

Despite the decline in I-SNPs, other types of special needs plans – namely Chronic Condition Special Needs Plans (C-SNPs) and Dual Eligible Special Needs Plans (D-SNPs) – are growing.

SNPs overall are making up 33% of all Medicare Advantage plans offered for 2026. That’s up from 27% of plans in 2025.

“We’re definitely seeing a lot of growth in the C-SNP space, which is just still a less saturated market than in the D-SNP space,” said Ali Rizer, Chief Growth Officers of ATI Advisory. “We’re still seeing growth in the D-SNP space, and we’re seeing some retractions in the I-SNP space, with some growth around the edges.”

Provider-led I-SNPs lead the way

Provider-led I-SNPs grew 2% year over year, with most plans offered in the Eastern United States, the ATI analysis found. Non-provider-led plans fell 14%, with one Medicare Advantage Organization (MAO) driving the decline.

One reason for the decline could be because of the specialization of the plan type, which focuses on people who need an institutional level of care.

“I think I-SNPS are a very unique model and a very intimate model, is actually the word I would use,” said Rose Mollitor, managing director for ATI Advisory. “You’re talking about such a population that’s in a concentrated facility, a concentrated location. I think that it’s not surprising that we’re seeing provider-led growth.”

Mollitor added that for MAOs to pursue an I-SNP, the population density needs to be available, which is why there is more growth in the eastern part of the country. It’s also vital that facilities are willing to take on the risk of an I-SNP. That is, by taking ownership in a special needs plan, a nursing home provider can see financial upside by managing the beneficiary population well and preventing costly episodes of care such as hospitalizations – but the downside risk is also present if expensive care does need to be provided.

As the 85 and older population increases, the need for institutional care increases, said Rizer, which can present a growth opportunity for I-SNPs in the future. But Mollitor said that Medicaid pressures could discourage facilities from partnering with an MAO in an I-SNP.

The I-SNP market has seen changes in recent years, including the exit of Optum – the health care services arm of UnitedHealth Group (NYSE: UNH) – from I-SNPs in several regions. And in one example of a provider-led I-SNP, a number of skilled nursing operators in Indiana have collaborated to launch what they describe as the largest I-SNP in the country.

D-SNPs grow in MMP demonstration states

D-SNPs are plans for people who are dually eligible for Medicare and Medicaid. These plans can be structured around exclusively aligned enrollment (EAE) or not. An EAE D-SNP requires the beneficiary to enroll in a single MAO’s Medicare Advantage and Medicaid plans.

For 2026, EAE plans grew 80% YOY; all D-SNPs grew 18%.

Beneficiaries in an EAE D-SNP are more likely than those in a nonaligned D-SNP to be residing in a long-term care facility, according to an Oct. 2024 JAMA Health Forum article.

The majority of growth is occurring in states that were part of the Medicare Medicaid Plan (MMP) demonstration, which will sunset at the end of the year. These states are working to integrate their plans for dual eligible individuals, while keeping key parts of the MMP plans.

“Think about your state Medicaid agency contracts (SMACs) that are allowing those states to have that authority and retain really important features of those MMP models,” said Kersten Lausch, Practice Director. “Those are things like integrated member materials, unified appeals, grievances, some of the integrated medical loss ratio pieces.”

How much D-SNPs continue to grow will depend on how much weight states put on Medicare-Medicaid integration, Lausch said. There is opportunity to shift expectations to manage dental and vision services to D-SNPs in demonstration states, while plans in states that already had integration can take advantage of value added benefits on the Medicaid side.

“There’s definitely an opportunity for plans to think about how you can be a thought leader and a partner with your states to really help support advancing integration,” Lausch said. “We know there’s benefits for members, providers, to the state. I think there’s also an opportunity for plans to think through, as we think about cost and care management, the opportunities internally of how you’re showing up for those members when they are aligned with you for both pieces.”

C-SNPs surge

C-SNPs grew 42% year over year, which Rizer said can be partly attributed to MAOs looking to provide new products to customers. C-SNPs offer a tailored insurance plan for people with certain chronic conditions. The Centers for Medicare & Medicaid Services (CMS) makes recommendations on chronic conditions to cover, but C-SNPs can create their own list.

“A single MAO is accounting for more than half of this growth, but I believe two or three MAOs are accounting for almost all of this growth,” Rizer said. “We’re also seeing some MAOs pulling back and reducing their C-SNP footprint.”

Much of the growth is happening in states that don’t have D-SNPs, with new C-SNP plans growing 67% in these states. States with a D-SNP plan saw 32% growth in offered C-SNPs. Nine MAOs reduced their footprint.

The cardiovascular, chronic heart failure and diabetes plan offerings grew 66% YOY, while chronic kidney disease fell 20%. One MAO added an obesity category to their C-SNPs.

There are many factors driving the growth in C-SNPs, said Mollitor, but the primary one is how plans are thinking about the population they serve. As the number of people 85 and over grows, plans are looking to better care for them.

Another factor driving growth of C-SNPs is MAOs are looking for financial stability. Targeting certain members of the population who have chronic conditions can be one pathway to that.

“Medicare beneficiaries are savvier from a shopping perspective,” Mollitor said. “I think they’re also demanding more targeted, tailored services to what they need. So if you’re a Medicare beneficiary who maybe hasn’t been interested in MA in the past, you may be more likely to be interested when you see a plan designed around the conditions that you have. You’re aware that you are needing additional support from a care management perspective.”

To the future

There are headwinds in the broader MA industry that could continue to affect SNP offerings, Mollitor said. Plans will likely focus on maintaining their current benefits, maybe at slightly less generous levels. Some plans are already releasing tiered options.

“I do think that carriers are going to be focused on preserving those benefits that are most important to the SNP populations as much as possible, and some of the low cost share for some of the critical medical services that go along with the complex care management,” she said.