Humana's Results Top Expectations
November 04 2016 - 7:40AM
Dow Jones News
Humana Inc.'s profit and revenue climbed in the third quarter,
helped by better-than-expected performance in its health care
services and Medicare Advantage businesses and despite continued
softness from its Affordable Care Act plans.
The results topped Wall Street expectations.
Chief Executive Bruce D. Broussard said each of the company's
businesses are meeting or exceeding performance expectations for
the year, except for its individual commercial business, which
sells plans on government-run exchanges as part of the Affordable
Care Act.
Humana's Medicare Advantage membership rose 3% to 2.8 million in
the latest quarter compared with a year ago, while individual
commercial membership dropped off 25% to 726,200. The company said
the drop in the individual plans primarily reflected the loss of
on-exchange membership due to competition, discontinuances,
non-payment of premiums or termination by the government because of
lack of eligibility and lower membership in non-ACA-compliant
plans.
Humana's consolidated medical-loss ratio, or the share of
premiums paid out for members' health expenses, fell to 81.5% from
83.9% in the year-ago quarter, which the company attributed mostly
to lower year-over-year utilization in the Medicare Advantage
business.
Over all, Humana posted a profit of $902 million, or $2.98 a
share, compared with $648 million, or $2.09 a share, in the
year-earlier period. Excluding certain items, the company said it
earned $3.18 a share; it anticipated $3.15 a share.
Revenue rose 2% to $13.69 billion, topping analysts' projection
for $13.41 billion, according to Thomson Reuters.
The Louisville, Ky., company is fighting regulatory pushback on
its merger deal with rival Aetna Inc. Regulators say the merger, as
well as Anthem Inc.'s planned tie-up with Cigna Corp., would harm
consumers, employers and health-care providers with an unacceptable
reduction in competition.
Humana stock, inactive premarket, has fallen 6.5% over the past
12 months.
Write to Joshua Jamerson at joshua.jamerson@wsj.com
(END) Dow Jones Newswires
November 04, 2016 07:25 ET (11:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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