Humana Profits Eclipse $1 Billion As Medicare Costs Ease Slightly
Humana reported first quarter net income of nearly $1.2 billion as costs of care for older adults in its Medicare Advantage plans eased a bit but remained high. Like many of its rival health insurers, the company has been battling rising medical expenses from customers in its health plans. Wednesday‘s results reflected costs that are still up with the company’s benefit ratio, which is the percentage of premium revenue that goes toward medical costs, eclipsing 89%. But Humana, which added more than 1 million enrollees in its Medicare Advantage plans this year, said its insurance segment benefit ratio of 89.4%, was “slightly favorable” to its earlier guidance of “just under 90%,” the company said Wednesday in its first quarter earnings report. “While it remains early, available information to date suggests that medical and pharmacy cost trends are slightly better than our expectations, across both new and existing membership.” Medical loss ratios have risen to 90% and above for several health insurance companies as claims pile up from doctors and hospitals seeing an influx of patients with a pent up demand for medical care. The industry would prefer such ratios to be below 90% and into the mid 80s, where the industry was less