Minnetonka-based Medica has laid off 162 workers, saying the reduction in force will align its resources with business priorities.
Minnetonka-based Medica lays off 162 workers
The health insurer’s move is to “align our resources with business priorities.”

The move comes at a time when health plans are confronting higher health care costs, although Medica and other nonprofit health plan companies in Minnesota saw a three-year string of annual profits from 2020 through 2022.
Medica’s annual profits, however, were shrinking. Regulatory filings suggest key company divisions, while still profitable, were less so through last year’s third quarter.
In November, Medica employed about 3,000 people. Workers losing their jobs are receiving severance payments, outplacement services and other benefits.
“We made the difficult decision to reduce our workforce to align our resources with business priorities,” the health insurer said in a statement. “Our commitment to high-quality, affordable health care for our members includes how we staff our health plan to best deliver on this commitment.”
Medica is Minnesota’s sixth-largest nonprofit group, with about $6 billion in revenue in 2022.
The insurer sells coverage to employers and Medicare beneficiaries, as well as people who buy on individual market health exchanges in several states. Medica also has a contract to manage care for patients in Minnesota’s Medicaid and related public programs, although its share of this market, which generated record profits in 2022, is smaller than other nonprofit carriers.
Medica dates to the mid-1970s, when doctors in the Twin Cities created an HMO called Physicians Health Plan of Minneapolis. This insurer merged with another health plan in 1991 to create Medica.
The nonprofit is now prohibited from suing to collect medical debts except in “extraordinary circumstances.”