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Lucrative Medicare Advantage Market Attracts Humana’s Focus

Insurance Forums Staff

Humana’s recently announced exit from the group health insurance market to focus on the Medicare Advantage market shows just how strong the lure of the lucrative MA market is—and how pressure on commercial health insurers continues to grow as employers seek to curb soaring healthcare costs and demand access to their claims data.

Humana, based in Louisville, Ky., had just under a million members in commercial health insurance plans at the end of 2022, or less than 6% of its total medical membership of about 17 million people, according to its Q4 2022 financial results. The company’s Medicare membership totaled about 8.7 million at the end of last year.

About 159 million Americans had employer-sponsored coverage in 2022, according to Kaiser Family Foundation.

“There are other players that are more entrenched in the employer market,” such as UnitedHealthcare, CVS Health’s Aetna, Elevance, Cigna, and other Blue Cross Blue Shield companies, Duane Wright, a senior health-care policy analyst with Bloomberg Intelligence, part of Bloomberg LP, said in an article posted on Bloomberg Law.

In contrast to Humana, Wright said Cigna has about 15 million commercial market members. But the government market may be increasingly enticing to insurers.

“Aside from Medicare, aside from Medicaid, there are expanding and growing opportunities with the Affordable Care Act,” Wright said.

In a statement announcing its decision to exit the group health market, Humana said it remains committed to the long-term growth of its core Insurance lines of business, including Medicare Advantage, Group Medicare, Medicare Supplement, Medicare Prescription Drug Plans, Medicaid, Military and Specialty (Dental, Vision, Life, etc.), as well as its CenterWell healthcare services business.

Following a strategic review, the company determined that the Employer Group Commercial Medical Products business was no longer positioned to sustainably meet the needs of commercial members over the long term or support the company’s long-term strategic plans. The exit from this line of business will be phased over the next 18 to 24 months. Humana said it is committed to ensuring a smooth transition of services for members and commercial customers.

“This decision enables Humana to focus resources on our greatest opportunities for growth and where we can deliver industry leading value for our members and customers,” said Bruce D. Broussard, Humana’s President and Chief Executive Officer. “It is in line with the company’s strategy to focus our health plan offerings primarily on Government-funded programs (Medicare, Medicaid and Military) and Specialty businesses, while advancing our leadership position in integrated value-based care and expanding our CenterWell healthcare services capabilities. We are confident in Humana’s continued success, and our commitment to improving the health of those we serve is unwavering.”




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