NEW YORK, Oct 1 (Reuters) - UnitedHealth ( UNH ) said it

will stop offering Medicare Advantage plans in 16 U.S. counties

in 2026, impacting 180,000 members, as the company balances

higher costs with reimbursement pressure in the insurance

program.

"The combination of (Centers for Medicare and Medicaid

Services) funding cuts, rising healthcare costs and increased

utilization have created headwinds that no organization can

ignore," said Bobby Hunter, who runs the company's government

programs.

UnitedHealth ( UNH ) is leaving the counties but will continue to

operate in most states, he said in a Tuesday press briefing.

The government pays private insurers to operate the Medicare

Advantage plans for people 65 and older or with disabilities.

The company's UnitedHealthcare insurance business has the most

enrolled members, ahead of rivals CVS Health ( CVS ) and Humana.

UnitedHealth ( UNH ) suspended its full-year guidance this year,

after missing earnings for the first time since 2008. The

company attributed the first-quarter earnings miss to unexpected

costs in its Medicare Advantage business as members increased

use of medical services.

UnitedHealth ( UNH ) in a second-quarter earnings call said

regulatory changes set to decrease payments the company receives

for certain conditions would present a $4 billion risk to

insurance profits in 2026.

It flagged in its second-quarter earnings release that

closing certain plans with about 200,000 members could help

mitigate the impact.

When compared with 2023, Hunter said government funding will

have dropped in 2026 by about 20%.

The company will cease operating over 100 plans representing

about 600,000 members in all, largely comprised of preferred

provider organizations or those that allow members to see

providers outside of a plan network, Hunter said.

The exits will likely steer patients toward health

maintenance organizations, or plans which require more frequent

referrals and limit patients to a network of providers, Hunter

said.

Most plan closures will occur in rural areas said Hunter,

where UnitedHealthcare is still working to streamline

operations: "We need a model that is sustainable and allows us

to bring care to folks in those areas in a cost-effective way."