Humana is Set to Exit the Commercial Group Medical Insurance Business
#Humana is set to exit the commercial group medical insurance business, phasing out its employer group commercial medical products over the next 18 to 24 months. The exit leaves just under 1 million members who will need to shift to other #payers.
Most of the payer's commercial business is concentrated in Florida, Texas, Georgia and Kentucky, where Humana is headquartered.
According to the company's end-of-year earnings report, at the end of 2022, Humana had 556,300 fully-insured commercial members and 430,100 members in self-funded plans that Humana administers. Humana will continue to offer specialty insurance, including vision and dental, in the commercial market.
Humana plans to shift its focus to government-funded insurance. The payer had 5.1 million individual #MedicareAdvantage members at the end of 2022.
The exit of Humana from the employer health insurance market may foreshadow difficult decisions ahead for large insurers as they face greater scrutiny on costs from companies while being lured by the more lucrative Medicare Advantage market.
Here are the markets where Humana has the most commercial insurance business:
Growth and Uncertainty in Medicare Advantage
Health insurers currently see a profitable business in privately run Medicare Advantage (MA) plans. Medicare is the only growth market within the health insurance landscape. More baby boomers are entering the Medicare market, and people are living longer than they used to.
Humana is probably one of the best and most knowledgeable in the Medicare Advantage space.
However, If there are changes made to the program and that profitability suffers, what do they have to fall back on?
The Centers for Medicare and Medicaid Services’ 2024 advance notice could reduce Medicare Advantage spending by $540 per Medicare Advantage enrollee on average next year, the Better Medicare Alliance said recently, citing an analysis from Avalere Health.
Despite their popularity, there are downsides to MA plans. In 2022, 99% of MA enrollees are in plans that require prior authorization for some services. In contrast to Medicare Advantage plans, traditional Medicare does not generally require prior authorization for services
Summary
Over the next 18 to 24 months, Humana will exit the Employer Group Commercial Medical Products business, which includes fully insured plans, self-funded plans and Federal Employee Health Benefit plans. The decision represents Humana's move to double-down on its Medicare Advantage business. #Humana #MedicareAdvantage #payers
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