Humana Inc. provides medical and specialty insurance products in the United States. It operates in two segments: Insurance and CenterWell. The Insurance segment offers Medicare Advantage products, stand-alone prescription drug plans, Medicare supplements, specialty and ancillary insurance, and administrative services for military personnel and pharmacy benefit managers. CenterWell operates senior-focused primary care centers, home health services, and pharmacy and hospice solutions. The company was formerly known as Extendicare Inc. and changed its name to Humana Inc. in April 1974. It was founded in 1961 and is headquartered in Louisville, Kentucky.
Humana wins Medicaid, pushes margin recovery, CenterWell grows
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Illinois Medicaid win expands members Humana won a statewide Illinois Medicaid contract, adding members across all 102 counties starting January 2027. More members mean more premium revenue, which supports future earnings and makes the stock more attractive.
New contract directly expands Humana's revenue base.
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AI gains may be competed away UBS says hospitals may benefit more from AI than insurers because insurers' efficiency gains are easily copied and competed away through pricing. This limits how much Humana can improve margins from AI, a headwind for profit growth.
Analyst view questions durability of insurer AI margin gains.
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Medicare Advantage denial scrutiny A New York Times report highlighted high denial rates for rehab care among major Medicare Advantage insurers, including Humana. This raises regulatory and reputational risk, which could lead to stricter rules or fines, pressuring the stock.
Regulatory scrutiny can hurt Humana's Medicare Advantage business.
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Margin recovery plan and strong Q1 Humana beat Q1 earnings estimates and targets insurance margins above 3% by 2028, with disciplined pricing and cost cuts. Strong results and a clear profit plan boost investor confidence, pushing the stock up.
New earnings and margin targets show improving profitability.
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CenterWell drives growth beyond insurance CenterWell revenue jumped 19.7% to $6.1 billion, with growth in primary care, home health, and pharmacy. This diversification reduces reliance on insurance and adds a steady profit stream, supporting the stock.
CenterWell's strong growth is a key new driver of Humana's value.
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Humana cuts 600k MA members, Star Ratings recovery is key catalyst
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Humana drops 600,000 Medicare Advantage members for 2027 Humana is cutting about 600,000 members from its Medicare Advantage plans next year, its second straight year of big cuts, to protect profit margins as medical costs rise. Fewer members means less premium revenue, which pressures the stock, though it may help margins.
This is the core new event driving Humana's outlook and was confirmed in this period.
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Star Ratings recovery targeted as key catalyst Humana aims to return to top-quartile Star Ratings by 2028, which would boost bonus payments and plan economics. Early progress is encouraging, and the October CMS ratings release is the next test. A rebound could support the stock, though shares already trade at a high valuation.
Star Ratings recovery is a major potential upside driver for Humana's turnaround and margins.
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Medicare fraud settlement and upcoding scrutiny The Villages Health settled a $541.5 million Medicare fraud case over inflated diagnosis codes. Humana's CenterWell unit is shielded from direct payment, but Humana received inflated payments and is returning overpayments. The case signals heightened government scrutiny on risk-adjustment practices, a regulatory risk for Humana.
This highlights a regulatory overhang that could affect Humana's payments and reputation.
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Sector-wide cost pressures and macro headwinds Managed care stocks, including Humana, fell after CVS Health warned of elevated medical costs. Rising oil prices and Treasury yields added to market pressure. These sector-wide concerns weigh on Humana's stock, though they are not specific to the company.
This explains a broad negative sentiment affecting Humana's price during the period.
Q3 2026
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Humana cuts 2026 profit outlook on star ratings drop
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Star ratings cut triggers profit outlook reduction Humana lowered its 2026 profit forecast to at least $6.52 per share from $8.36 after fewer Medicare Advantage plans earned four-plus star ratings, reducing federal bonuses. Shares fell about 9% premarket.
This was the main negative event that drove the stock down during the quarter.
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Strong Q2 earnings beat and membership growth Q2 adjusted earnings of $7.61 beat estimates by over 20%, with revenue up 26% to $40.9 billion and membership up 20.7%. This shows underlying business strength despite the outlook cut.
This positive result provided a counterweight to the negative star ratings news.
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Margin recovery path and expansion offset by headwinds Humana reiterated a path to 3% margins by 2028, with weaker plan exits and Medicaid/home-health expansion. But risks include the end of a $3.6 billion Part D subsidy raising 2027 premiums and 600,000 MA members dropped for 2027.
This captures the balanced mix of positive strategic progress and negative regulatory/market pressures.
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Medicare fraud settlement and sector cost pressures A $541.5 million Medicare fraud settlement highlighted upcoding scrutiny, and sector-wide medical cost pressures persist. These add regulatory and financial risks that could weigh on future profits.
This points to ongoing legal and cost challenges that could affect Humana's financial performance.
News & notes movingHUM
United States
HUM▼impact 4
Humana Shrinks Medicare Advantage Footprint for 2027
Humana will offer Medicare Advantage plans in nearly 2,600 counties across 45 states and Washington, D.C. for the 2027 plan year, a sharp reduction from the 46 states and Washington, D.C. it covered for 2026, when its plans reached 85% of U.S. counties. The Louisville, Kentucky-based insurer, the second-largest MA player behind UnitedHealth, said the new footprint represents more than 80% of U.S. counties, and it has announced plans to discontinue offerings affecting 600,000 enrollees. UnitedHealth said its UnitedHealthcare MA plans will remain accessible to 94% of Medicare-eligible individuals next year, unchanged from 2026, though Bloomberg reported that roughly 390,000 people will be part of plans being shut down. CVS Health's Aetna unit and Centene are also pulling back their MA offerings, according to CMS data reviewed by Wall Street analysts, while Alignment Healthcare is expanding to 55 counties and Clover Health said its plans will reach 5.2M Medicare-eligible individuals across 203 counties in five states. The moves come as the MA market contends with rising medical costs and intense government scrutiny, and after CMS said 2027 MA enrollment is expected to reach 34M, a 6% decline, despite a more than 16% drop in MA premiums versus 2026 on a weighted average basis.
HUM · Regulation · Negative Humana is sharply shrinking its 2027 Medicare Advantage footprint and discontinuing plans affecting 600,000 enrollees amid rising costs and government scrutiny.
ALHC · Demand · Positive Alignment Healthcare is expanding its Medicare Advantage footprint to 55 counties, a growth move against peers' pullbacks.
CLOV · Demand · Positive Clover Health said its plans will reach 5.2M Medicare-eligible individuals across 203 counties in five states, an expansion.
CNC · Regulation · Negative Centene is pulling back its Medicare Advantage offerings amid rising medical costs and intense government scrutiny.
CVS · Regulation · Negative CVS Health's Aetna unit is pulling back its Medicare Advantage offerings amid rising medical costs and government scrutiny.
UNH · Regulation · Neutral UnitedHealth's MA plans stay at 94% coverage unchanged, but ~390,000 enrollees are in plans being shut down amid MA market scrutiny and rising costs.
BrightSpring Health Services' Specialty and Infusion business grew revenue 30% year over year in the second quarter, with scripts up 31%, driven by branded limited distribution drug growth, new launches, fee-for-service programs, generics and acute-infusion expansion. The company added two ultra-narrow-network LDDs in the quarter, bringing its total portfolio to 155 programs, and launched 12 LDDs in the first half of 2026, four as exclusive partners and eight as ultra-narrow-network programs. Pharmacy Solutions' adjusted EBITDA rose 44% to $180 million, and management expects continued quarter-over-quarter growth through the remainder of 2026. BrightSpring said it has several hundred clinical liaisons across thousands of prescriber offices and 15 years of LDD experience, infrastructure it can leverage for rare and orphan therapies. Separately, Cigna's Specialty & Care pretax adjusted earnings rose 22% year over year to $1.1 billion, while Humana's second-quarter growth was driven primarily by Medicare Advantage membership and CenterWell expansion.
Brent tops $100, Treasury yields climb as U.S. equities slip
U.S. equities pushed lower on Wednesday as oil kept climbing, with Brent crude breaking above $100 a barrel while U.S.–Iran tensions in the Middle East continued to weigh on sentiment. Treasury yields advanced after the Treasury Department said it will repurchase up to $6 billion of longer-dated notes in Thursday's operation, tripling the size of its last long-end buyback; the 2-year yield rose 2 basis points to 4.42%, the 10-year added 5 basis points to 4.84%, and the 30-year gained about 4 basis points near 5.29%. Brent crude futures surged above $100 per barrel for the first time since July 24, with front-month Brent for November delivery climbing 3.3% to $101.13/bbl and Nymex crude jumping 3.2% to $96.02/bbl, as traffic through the Strait of Hormuz dropped from roughly 8 million barrels per day in late August to only 1 million barrels per day this week, according to Rystad Energy. Separately, Anthropic's Alignment Science Lead Evan Hubinger said he "earnestly" believes AI could kill all humans, putting his personal estimate of the probability at more than 10% within the next decade, and the company's latest risk report upgraded the risk from misalignment in high-stakes settings to "low" from "very low." Managed care stocks declined after CVS Health said at the Wells Fargo Healthcare Conference that it continues to face elevated medical costs, with notable decliners including UnitedHealth, Humana, Clover Health, Alignment Healthcare, Centene, Oscar Health, Elevance Health, and Molina Healthcare.
Medicare Advantage Nonrenewal Notices Due October 2
Insurers have already told Wall Street which Medicare Advantage plans will end on December 31, 2026, but members will only learn by mail, with nonrenewal notices due by October 2. Humana confirmed that its 2027 plan exits will affect approximately 600,000 members, while UnitedHealth Group expects Medicare Advantage enrollment to decline by about 1.1 million. These terminations open a rare guaranteed-issue Medigap window, but only for members returning to Original Medicare, not for those switching to another Advantage plan. With Medicare Open Enrollment closing December 7, members should save the notice and price both coverage paths immediately, as Medigap premiums can range from $150 to $250 monthly, while a $0-premium Advantage plan may have an out-of-pocket maximum up to $9,250 in 2026.
The Villages Health Settles Medicare Fraud for $541.5 Million
The Justice Department announced a $541.5 million settlement with The Villages Health over alleged Medicare Advantage upcoding, resolving claims that from 2020 to 2024 the primary care provider submitted false diagnosis codes to increase reimbursements. By 2024, about half of the company's patient diagnosis codes were unsupported, according to an outside consultant's review cited by Healthcare Dive. The settlement targets the bankrupt pre-sale entity, The Villages Health System LLC, with the government holding a nondischargeable claim in the Chapter 11 process, while Humana's CenterWell division, which acquired the operating business for $68 million in late 2025, is shielded from direct payment. The insurers that received inflated payments, including Humana, UnitedHealthcare, and Blue Cross Blue Shield of Florida, are returning overpayments credited against the total. The same month, the Justice Department resolved two other Medicare Advantage upcoding cases, signaling a national enforcement priority on risk-adjustment fraud.
The Villages Health · Regulation · Negative The Villages Health System LLC settled DOJ Medicare Advantage upcoding claims for $541.5 million, with a nondischargeable claim in its Chapter 11 case.
HUM · Regulation · Neutral Humana's CenterWell unit acquired the operating business and is shielded from direct payment, but Humana received inflated payments and is returning overpayments credited against the settlement.
UNH · Regulation · Negative UnitedHealthcare received inflated Medicare Advantage payments and is returning overpayments credited against the $541.5M settlement.
Blue Cross Blue Shield of Florida · Regulation · Negative Blue Cross Blue Shield of Florida received inflated payments and is returning overpayments credited against the settlement.
Thyme Care Raises $125M Series E, Forms Thyme Companies
Thyme Care, a Nashville-based oncology company, announced a Series E financing round of over $125 million, led by Morgan Health with participation from Humana, CVS Health Ventures, and other investors, at a valuation exceeding $2 billion. The company also established Thyme Companies, a new parent entity aimed at building a portfolio of oncology-focused businesses to address challenges such as biosimilar adoption and clinical trial enrollment. Thyme Care, which serves over 10.5 million people across all 50 states and manages more than $7 billion in oncology spend, reports validated cost reductions of 5 to 10 percent and is profitable with positive free cash flow. Co-founder Robin Shah will become executive chairman of Thyme Companies, while Brad Diephuis remains CEO of Thyme Care, with Bobby Green as president and chief medical officer. The first new business under Thyme Companies is expected to launch later this year.
Thyme Care · Capital · Positive Thyme Care raised over $125M in Series E funding at a valuation exceeding $2 billion, led by Morgan Health with CVS Health Ventures and Humana participating.
Thyme Companies · Capital · Positive Thyme Companies was newly established as the parent entity of Thyme Care, formed alongside the $125M Series E raise.
HUM · Capital · Positive Humana participated in Thyme Care's $125M Series E financing round, a direct investment in the oncology company.
UnitedHealth Prioritizes Medicare Advantage Profitability Over Membership Growth
UnitedHealth Group is shifting its Medicare Advantage strategy to prioritize profitability over membership expansion, expecting 2026 enrollment to decline by approximately 1.1 million members due to targeted exits from unprofitable plans. Medicare margins are now expected to finish the year above 3%, reflecting tighter benefit design, pricing actions, and a more favorable membership mix, while the company expects Medicare medical cost trends to come below the initial estimate of near 10%. UnitedHealth's consolidated medical care ratio improved to 86.7% in the second quarter from 89.4% a year ago, and the company raised its 2026 adjusted EPS outlook to $19.50-$20. The Zacks Consensus Estimate for UnitedHealth's 2026 earnings is pegged at $19.69 per share, implying 20.4% growth from the year-ago period, and the stock currently carries a Zacks Rank #1 (Strong Buy).
UNH · Capital · Positive UnitedHealth raised its 2026 EPS outlook and reported improved margins, signaling strong financial performance.
ELV · Competition · Negative UnitedHealth's strategic shift to prioritize profitability may pressure competitors like Elevance to follow suit, potentially impacting their growth.
HUM · Competition · Negative Humana faces competitive pressure as UnitedHealth exits unprofitable plans, potentially reshaping the market and affecting Humana's positioning.
Humana Star Ratings Recovery Seen as Key Medicare Advantage Catalyst
Humana's Star Ratings recovery is emerging as a key catalyst for its Medicare Advantage turnaround, with the company targeting a return to top-quartile performance by bonus year 2028. The company defines top-quartile performance as Stars revenue per member per month 10% above the peer median, and a successful recovery could improve the economics of its MA plans and complement other margin initiatives. Early execution signals are encouraging, with the rate of improvement across 11 of 12 selected HEDIS and patient-safety measures outpacing historical trends. The October Centers for Medicare & Medicaid Services Stars release will be the key near-term test, and a meaningful rebound could strengthen the case that Humana is on a credible path toward its 2028 margin target of at least 3% pretax. Shares of Humana have gained 47.6% year to date, outperforming the broader industry's 20.2% growth, and the stock trades at a forward price-to-earnings ratio of 29.24X versus the industry average of 15.98X.
Health insurance providers reported strong second-quarter results, with the 12 tracked stocks beating revenue consensus estimates by 2.8% as a group. Humana posted revenues of $40.87 billion, up 26.2% year over year, exceeding expectations by 0.6%. CVS Health delivered the best quarter with revenues of $106.1 billion, up 7.3% and beating estimates by 6.7%, while Progyny was the weakest with revenues of $350.5 million, up 5.3% but missing next-quarter EBITDA guidance significantly. Oscar Health achieved the fastest revenue growth at 70.4% to $4.88 billion, and Centene topped estimates by 13.1% with revenues of $53.58 billion. Despite the beats, the group's stocks are down 5.8% on average since reporting.
Health insurers drop Medicare Advantage plans affecting nearly 3 million seniors
Nearly 3 million older Americans face forced disenrollment from their Medicare Advantage plans this year as major insurers exit markets to protect profits. An analysis by Johns Hopkins Bloomberg School of Public Health researchers found one in 10 Medicare Advantage policyholders are losing their plans, up from a 6.9% disenrollment rate in 2025 and an average of 1% between 2018 and 2024. Humana announced it will exit multiple markets in 2027 for the second consecutive year, impacting 600,000 members, while Clear Spring Health shut down its Medicare Advantage operations effective June 1 and Presbyterian Health Plan will exit most markets in 2027 affecting about 30,000 policyholders. Insurers cite lower federal reimbursement rates and rising medical costs, with UnitedHealth and Humana together accounting for nearly half of all Medicare Advantage enrollment nationwide.
Humana Partners With HealthStream to Boost Indiana Home-Care Workforce
Humana's Medicaid managed care plan, Humana Healthy Horizons, is teaming up with HealthStream in Indiana to strengthen the state's home-care workforce. Under the initiative, Humana is sponsoring 1,000 Home Health Aide scholarships to help remove financial barriers for people entering the caregiving field. The program uses HealthStream's Career Network to reach rural and underserved communities, and Humana is also deploying HealthStream's CoachUp Care platform, predictive analytics and training tools to help providers recruit and retain caregivers. The collaboration targets high caregiver turnover, as home-care providers have an average annual turnover rate of 77%, while Humana says trained home-care aides are more than twice as likely to remain employed after three months and 64% more likely to stay after six months than workers without comparable training. Early results show 81% of participating providers achieving above-average caregiver retention, with providers that improved retention reporting an average 43% increase.
Aging Population › Home Healthcare & Hospice ▲Supply
HUM · Demand · Positive Humana sponsors 1,000 scholarships and deploys training tools to improve caregiver retention, directly benefiting its Medicaid plan.
HSTM · Demand · Positive HealthStream's Career Network and CoachUp Care platform are used in Humana's initiative, expanding its services and market reach.
James P. Holland to Join Humana as Medicaid President
Humana announced that James "J.P." Holland will join the company as senior vice president and President of Medicaid, effective August 17. Holland will lead Humana's Medicaid business, which currently serves more than 1.6 million members in 11 states, and will report to Aaron Martin, President of Insurance. He most recently served as President and CEO of Johns Hopkins Health Plans, and previously held leadership roles at Elevance Health, Amerigroup, and WellCare Health Plans.
Humana cuts 2026 EPS guidance to at least $6.52 despite strong Q2
Humana lowered its full-year 2026 GAAP EPS guidance to at least $6.52 from at least $8.36, even as it reported second-quarter revenue of $40,867 million and net income of $694 million. The company also confirmed completion of a $276.13 million share repurchase program and announced two new board appointments, Paul Smith and Frederick Crawford. The guidance cut signals a more cautious profitability outlook amid medical cost and Stars-related headwinds, while the quarterly beat and stable revenue trends indicate the core Medicare Advantage and CenterWell franchise remains intact.
CVRx cuts full-year revenue outlook as sales force productivity lags
CVRx reported second-quarter 2026 revenue of $15.7 million, a 16% increase from the prior year, but lowered its full-year revenue guidance to between $58.0 million and $60.0 million. U.S. revenue rose 21% to $14.8 million, driven by growth in heart failure implants and expansion to 258 active implanting centers, while European revenue fell 31% to $0.9 million. The company cited fewer sales territories than anticipated, lower sales force productivity, and a prolonged challenge with one of its largest payers as reasons for the reduced outlook. Gross margin improved to 87%, and net loss narrowed to $14.0 million, or $0.53 per share. Humana issued a Medicare Advantage coverage policy for Barostim therapy effective May 1, 2026, marking the first coverage policy of its kind for the device.
Humana Subsidiary iCare Selected for Family Care and Family Care Partnership Contracts Across Southeast Wisconsin
Independent Care Health Plan, a Humana subsidiary, has been selected by the Wisconsin Department of Health Services to serve both the Family Care and Family Care Partnership programs in the greater southeast region. The award expands iCare's footprint to all seven counties in the service area and marks its third consecutive Wisconsin geographic win, with the organization earning the highest overall evaluation score among awardees for both programs. With this pending contract, iCare will now offer Family Care, branded Inclusa, in all 72 counties, while expanding access to Family Care Partnership in Kenosha, Ozaukee, Racine, Sheboygan, Walworth, Washington, and Waukesha. CEO Kiva Gittings Graves said the selection represents continuity for existing members and new access to high-quality long-term care services for more Wisconsinites.
HUM · Demand · Positive iCare, a Humana subsidiary, won contracts to serve Family Care and Family Care Partnership programs, expanding its footprint and membership.
AdaptHealth Cuts Full-Year EBITDA Guidance by $55 Million on Contract and Pricing Headwinds
AdaptHealth Corp lowered its full-year adjusted EBITDA guidance by $55 million, citing a $40 million second-half impact from a missed West Coast capitated contract and a $30 million hit from a major manufacturer's contract termination and immediate price increase. The company also announced a definitive agreement to sell its diabetes business for $235 million, recorded a $144.2 million non-cash goodwill impairment related to that divestiture, and expanded its capitated relationship with Humana to 33 states plus D.C. and South Florida, transitioning 478,000 new members. Organic growth reached 16% with record volume gains, and a new AI-powered mask fitting tool achieved a 92% conversion rate in its first two weeks, driving a 56% increase in MyApp adoption. A workforce restructuring is expected to deliver $19 million in annualized savings, while free cash flow was negative $20.9 million in the second quarter due to $166.2 million in capital expenditures.
AHCO · Capital · Negative Cut full-year EBITDA guidance by $55 million due to contract and pricing headwinds, and recorded a $144.2 million goodwill impairment.
AHCO · Demand · Positive Expanded Humana capitated relationship to 33 states plus D.C. and South Florida, transitioning 478,000 new members, and organic growth reached 16% with record volume gains.
HUM · Demand · Positive Expanded capitated relationship with AdaptHealth to 33 states plus D.C. and South Florida, transitioning 478,000 new members.
Regeneron and DexCom lead healthcare sector in July as Moderna and managed-care stocks retreat
The healthcare sector gained about 2.45% in July, outperforming the broader S&P 500 which slipped around 0.12%. Regeneron Pharmaceuticals was the biggest winner, climbing 22.08%, followed by DexCom which gained 21.19% after its Q2 earnings beat and raised full-year guidance, and Baxter International which advanced 20.61%. Moderna was the biggest detractor, dropping 24.39%, while Intuitive Surgical fell 12.19% and managed-care insurers Humana, Elevance Health, and Centene also finished among the weakest performers. Earnings-driven gains in pharmaceuticals and medtech contrasted with weakness in managed-care insurers and vaccine makers.
Medicare Advantage Insurers Lock In 2027 Benefit Cuts and Market Exits
UnitedHealth and Humana have already locked in their 2027 Medicare Advantage strategies, with UnitedHealth trimming enrollment by 1.1 million members and Humana targeting 25% growth. Members whose plan is discontinued will have a 63-day guaranteed-issue window for Medigap Plans A, B, C, D, F, and G, though Plans C and F are unavailable to people newly eligible for Medicare on or after January 1, 2020. Missing that window allows insurers to medically underwrite, charge more, or deny coverage based on health. The Annual Notice of Change must arrive by September 30, and the Annual Enrollment Period runs from October 15 through December 7. CMS also grants a Special Enrollment Period from December 8 through the end of February for those whose plan does not renew.
South Korea Caps Single-Stock Leveraged ETFs to Calm Market Volatility
South Korea's finance minister has initiated caps on single-stock leveraged ETFs, a first-of-its-kind move to quiet market volatility related to memory chip giant SK Hynix. The KOSPI index fell another 6% overnight, bringing its weekly decline to 15%, while SK Hynix shares dropped 1% after missing top and bottom line estimates in its first publicly traded earnings report, despite triple-digit increases in operating profits and sales. The broader market showed pre-market futures flat to down ahead of the Federal Reserve's interest rate decision, with the Dow off 340 points and the Nasdaq down 7. Saudi Arabia attacked Iran-backed forces in Iraq, widening the Middle East conflict and pushing spot oil prices back up, though they remain in the $80s per barrel. In earnings, Procter & Gamble beat fiscal Q4 earnings by 2 cents per share on revenues of $21.2 billion, Humana posted a 22.35% positive earnings surprise with $7.61 per share, and Biogen reported $3.60 per share, well above the $3.04 consensus.
Humana Q2 Earnings Beat Estimates on Medical Membership Growth
Humana reported second-quarter 2026 adjusted earnings of $7.61 per share, beating the Zacks Consensus Estimate by 22.4% and rising 21.4% year over year. Adjusted revenues improved 26.2% to $40.9 billion, surpassing the consensus mark by 0.6%, driven by premium gains and a strong performance from the CenterWell segment. Total medical membership reached 17.9 million as of June 30, 2026, up 20.7% year over year and exceeding estimates. The benefit ratio deteriorated 140 basis points to 91.1%, while the adjusted operating cost ratio improved 120 basis points to 9.7%. Humana reaffirmed its full-year 2026 revenue guidance of at least $160 billion and adjusted EPS of at least $9, though GAAP EPS guidance was lowered to at least $6.52 from the prior $8.36.
Humana cuts 2026 profit outlook on lower Medicare star ratings
Humana cut its full-year earnings outlook on Wednesday as lower Medicare Advantage Star Ratings reduced the quality bonuses it receives from the federal government. The health insurer revised its full-year GAAP earnings target to a minimum of $6.52 per share, down from its earlier projection of at least $8.36 per share, while leaving its adjusted forecast intact at a minimum of $9 per share. A significant decline in the number of Humana's plans rated four stars or higher has weighed on its 2026 bonus payments from the Centers for Medicare and Medicaid Services. Second-quarter profit rose to $694 million, or $5.73 per share, from $545 million, or $4.51 per share, a year earlier, with total revenue up 26% to $40.87 billion. On an adjusted basis, the company earned $7.61 per share, beating the Wall Street Journal analyst consensus of $7.26. Humana also reaffirmed its expectation that individual Medicare Advantage enrollment will expand by roughly 25% compared with 2025, and its stock fell about 9% in premarket trading.
Humana Elects Paul Smith and Frederick Crawford to Board of Directors
Humana has elected Paul Smith and Frederick Crawford to its Board of Directors, effective immediately. Smith is the Chief Commercial Officer at Anthropic PBC and brings over 30 years of experience leading global go-to-market organizations at major enterprise technology companies, including ServiceNow, Salesforce, and Microsoft. Crawford brings more than 30 years of insurance and banking experience, having served as President and Chief Operating Officer of Aflac until his retirement in 2024, and previously as CFO of CNO Financial Group and Lincoln Financial Group. The elections expand Humana's board to 13 directors.
Trump administration ends Medicare Part D subsidy, raising 2027 premiums for most enrollees
A Trump administration decision to end a Medicare Part D subsidy program means that three out of four enrollees will see higher plan premiums in 2027. About 45% of enrollees will see an $11 to $20 monthly increase, while another 30% will pay $10 or under more per month, according to a report in The Wall Street Journal. An administration official told the newspaper that the subsidy provided an incentive for health insurers to boost rates as the federal government would foot the additional amount. The subsidy provided approximately $3.6 billion in support in 2026, according to the Government Accountability Office. The top Medicare Part D insurers include Centene, Humana, and UnitedHealth Group.
Aging Population › Chronic-Disease Pharma Franchises ▼Regulation
CNC · Regulation · Negative End of Medicare Part D subsidy will reduce government payments to insurers, pressuring Centene's Part D margins and raising premiums for enrollees.
HUM · Regulation · Negative End of Medicare Part D subsidy will reduce government payments to insurers, pressuring Humana's Part D margins and raising premiums for enrollees.
UNH · Regulation · Negative End of Medicare Part D subsidy will reduce government payments to insurers, pressuring UnitedHealth's Part D margins and raising premiums for enrollees.
Zacks Research Flags Four Medical Stocks Poised for Q2 Earnings Beats
Zacks Investment Research has identified four medical-sector companies with the right setup to beat second-quarter earnings expectations. The picks are CVS Health, Cardinal Health, Humana, and ACADIA Pharmaceuticals, each combining a positive Earnings ESP with a Zacks Rank of 1 or 2. Humana carries a Zacks Rank of 1 and an Earnings ESP of plus 1.71 percent, with consensus revenue estimates of 40.65 billion dollars implying 25.5 percent growth. CVS Health holds a Zacks Rank of 2 and an Earnings ESP of plus 1.42 percent, with consensus revenue of 100.18 billion dollars. Cardinal Health also has a Zacks Rank of 2 and an Earnings ESP of plus 1.24 percent, with fiscal fourth-quarter revenue pegged at 65.61 billion dollars. ACADIA Pharmaceuticals rounds out the list with a Zacks Rank of 2 and an Earnings ESP of plus 25.00 percent, driven by expected growth from Daybue and Nuplazid.
UnitedHealth Raises 2026 EPS Outlook Above Estimates, Shares Jump 10.3%
UnitedHealth Group raised its full-year adjusted earnings outlook after second-quarter profit exceeded Wall Street expectations, sending shares up as much as 10.3% in their largest intraday gain since April. The company now expects adjusted earnings of $19.50 to $20 per share this year, up from a prior forecast of more than $18.25 and above analyst estimates. A closely watched measure of medical costs also performed better than projected, while quarterly profit topped the highest estimate in a Bloomberg survey. Chief Financial Officer Wayne DeVeydt said improving medical-cost trends in the first half gave the company greater confidence to raise its outlook, and the updated forecast could provide a starting point for increasing profits next year at the company's historical target rate of 13% to 16% average annual earnings-per-share growth. Shares of Humana and CVS Health also advanced following the report.
Health insurance stocks rise 37.4% on average after strong Q1 earnings
Health insurance provider stocks tracked by this publication posted a strong first quarter, with revenues beating analyst consensus estimates by 1.4% and next-quarter revenue guidance coming in line. As a group, share prices have risen 37.4% on average since the latest earnings results. Cencora reported revenues of $78.36 billion, up 3.8% year on year but falling short of expectations by 3.9%, leaving its stock flat. CVS Health delivered the biggest beat, with revenues of $100.4 billion up 6.2% year on year and exceeding estimates by 6.3%, driving a 29.2% stock gain. Molina Healthcare's revenues of $10.8 billion, down 3.1% year on year, met expectations but its full-year revenue guidance missed significantly, yet the stock surged 52.6%. Humana's revenues of $39.65 billion, up 23.5% year on year, met estimates and its full-year EPS guidance beat, propelling a 70.4% stock increase. Clover Health achieved the fastest revenue growth at 62% year on year to $749.2 million, beating estimates by 4.8%, and its stock jumped 65.9%.
Humana has set a goal of achieving a 3% Medicare Advantage margin by 2028, a key milestone for its long-term earnings recovery. The company continues to expect approximately 25% growth in individual Medicare Advantage membership in 2026, focusing on attracting higher-quality members through disciplined pricing, stronger product design, and better retention. Humana is also investing to rebuild its Medicare Star Ratings, which drive future reimbursement and profitability, and reaffirmed its 2026 adjusted EPS guidance of at least $9.00. Shares of Humana have gained 53.1% year to date, outperforming the broader industry's 28.5% growth, and the stock trades at a forward price-to-earnings ratio of 32.21, above the industry average of 18.48.
UnitedHealth Launches Lifestyle Spending Account Integrated with UHC Store
UnitedHealth Group has launched a Lifestyle Spending Account, an employer-sponsored, post-tax benefit integrated with its UHC Store platform, enabling eligible members to purchase approved health, wellness and lifestyle products without submitting reimbursement claims. The account covers categories such as fitness, nutrition, sleep, mindfulness, women's health and weight management, and is available to more than 15 million UnitedHealthcare commercial members with over 30 offerings from dozens of vendors. The initiative aims to simplify administration for employers and strengthen UnitedHealth's digital healthcare ecosystem, though it is unlikely to materially boost near-term earnings. Competitors Humana and Elevance Health are also expanding their employer-sponsored health benefits through virtual care, wellness programs and integrated care platforms.
Medicare Advantage insurers to receive over $13B in bonus payments in 2026
Health insurers led by UnitedHealth, Humana, and CVS Health are expected to receive at least $13.4 billion in federal bonus payments this year under the Medicare Advantage quality bonus program, according to a report by health research organization KFF. The program rewards plans rated four stars and above, with nearly 24 million enrollees, or about 68% of total Medicare Advantage members, in such plans this year, up from 55% in 2015 when bonus payments totaled only $3 billion. UnitedHealth, the largest Medicare Advantage insurer, is set to receive $3.9 billion, or 29% of total bonus spending, while Humana will receive $1.5 billion, or 11%, after its average star rating dropped sharply. CVS Health and Elevance Health are expected to receive $2 billion and $462 million, respectively, and Centene will be eligible for $21.5 million. KFF noted that eliminating the program could yield substantially higher savings than the Congressional Budget Office's 2018 estimate of $100 billion over 10 years, given the sharp increase in Medicare Advantage enrollment.
Aging Population › Retirement Income & Annuities ▲Regulation
UNH · Regulation · Positive UnitedHealth is set to receive $3.9 billion, the largest share (29%) of the $13.4 billion in bonus payments.
HUM · Regulation · Positive Humana will receive $1.5 billion in bonus payments despite a drop in star rating, representing 11% of total bonus spending.
CVS · Regulation · Positive CVS Health is expected to receive $2 billion in bonus payments from the Medicare Advantage quality bonus program.
ELV · Regulation · Positive Elevance Health is expected to receive $462 million in bonus payments from the Medicare Advantage quality bonus program.
CNC · Regulation · Positive Centene is eligible for $21.5 million in bonus payments from the Medicare Advantage quality bonus program.
Humana Foundation Announces Over $12 Million in New Grants for Emotional Health
The Humana Foundation has announced over $12.2 million in new grants to combat loneliness, depression, and social isolation among seniors and veterans nationwide. The funding supports 13 nonprofit organizations and five university research teams, with major investments including $3 million to Older Adults Technology Services from AARP, $1 million to Friendship Bench, and $890,000 to the National Recreation & Park Association. Regional grants target Texas, Florida, Kentucky, and multi-state interventions, while $1.75 million is allocated to research institutions exploring emotional health and nutrition through AI, culturally tailored interventions, and whole-person care. The foundation will announce a second slate of grants in Fall 2026.
Aging Population › Home Healthcare & Hospice ▲Demand
Aging Population › Senior Care ▲Demand
HUM · Capital · Positive The Humana Foundation's $12M+ grants for emotional health are a charitable activity, not a core business driver, but may enhance brand reputation.
CenterWell Drives Humana's Growth Beyond Insurance with 19.7% Revenue Jump
CenterWell is playing a growing role in Humana's strategy to evolve beyond its traditional health insurance business. In the first quarter of 2026, the segment generated $6.1 billion in revenues, up 19.7% year over year, reflecting growth across primary care, home health, and pharmacy services. Humana expects CenterWell's total revenues to generate at least $25 billion in 2026. The company is strengthening the platform through acquisitions such as MaxHealth, which added approximately 59,000 patients and 54 centers, and through a Cost Plus partnership to develop prescription drug solutions for employers. Humana is also improving operational efficiency by increasing automation and using AI-enabled analytics to identify care gaps and support proactive care management.
2 Healthcare Stocks with Competitive Advantages and 1 Facing Challenges
CVS Health faces challenges with flat sales forecast and declining earnings per share, while Humana and Molina Healthcare show strong revenue growth and competitive advantages. CVS Health's annual sales growth of 6.3% over the last two years lagged behind peers, and its earnings per share fell by 1.5% annually over five years despite revenue growth. Humana posted annual revenue growth of 13.6% over two years and projects 19.4% growth for the next 12 months, with a dominant market position and $137.3 billion in revenue. Molina Healthcare achieved 16.2% annual revenue growth over five years and has a large revenue base of $45.08 billion, giving it negotiating power.
Humana wins statewide Illinois HealthChoice Medicaid contract starting 2027
Humana has been selected by the Illinois Department of Healthcare and Family Services to serve members statewide in HealthChoice Illinois, the state's Medicaid managed care program covering 102 counties, with the plan expected to begin operations in January 2027. The contract adds a long-dated growth avenue for the company, which is heavily exposed to Medicare Advantage and faces near-term margin pressures from a preliminary 2027 rate update and ambitious membership growth goals. Investors are weighing the Illinois win against the risk that Humana's earnings remain sensitive to future reimbursement policy changes. The company's upcoming second-quarter 2026 earnings release on July 29 is expected to provide a clearer read on current Medicare Advantage performance and medical cost trends, framing how meaningful the future Illinois Medicaid contribution could be.
Pzena Focused Value Strategy Fell 4.7% in Q1, Hurt by Humana
Pzena Investment Management's Focused Value Strategy returned negative 4.7% net in the first quarter of 2026, underperforming the Russell 1000 Value Index's 2.1% gain. The portfolio was weighed down by the health care, financials, and technology sectors, with Medicare Advantage insurer Humana Inc. emerging as the largest individual detractor. Humana's shares fell after the Centers for Medicare and Medicaid Services proposed a disappointing preliminary Medicare Advantage rate update for 2027, and management's projection of rapid membership growth in 2026 raised investor concerns about overly rich plan benefit design relative to peers. Pzena views these risks as more timing-related than thesis-changing and added to its Humana position on weakness. Humana closed at $360.72 per share on June 22, 2026, with a market capitalization of $43.31 billion, and was held by 61 hedge funds at quarter-end, up from 53 in the prior quarter.
CVS Health Faces Scrutiny Over Medicare Advantage Denials for Rehab Care
CVS Health is under scrutiny after a New York Times report highlighted that it and other major Medicare Advantage insurers frequently denied necessary rehabilitation care to older Americans. The article, citing two federal reports, stated that top providers rejected roughly 13% of patient requests for skilled nursing facility admissions, with denial rates reaching 40% for existing nursing home residents. A CVS spokesman said the company evaluates requests promptly and provides a transparent appeals process. Separately, Mizuho raised its price target on CVS to $115 from $110 on June 8, maintaining an Outperform rating, citing a more stable policy environment.
UnitedHealth Gains Edge Over Humana on Diversified Model and Stronger Outlook
UnitedHealth Group appears better positioned than Humana among healthcare leaders, according to a Zacks Investment Research analysis. UnitedHealth benefits from a diversified platform spanning insurance, health services, and technology, while Humana remains more focused on Medicare. UnitedHealth trades at 20.57 times forward earnings with a 2.3% dividend yield, compared to Humana's 30.47 times multiple and 1% yield. Consensus estimates project UnitedHealth's 2026 earnings will rise 12.1%, whereas Humana's are expected to drop 47.4%. Both stocks carry a Zacks Rank #3, or Hold.
UBS says hospitals may gain more from AI than health insurers
UBS analysts say hospitals could build a more durable competitive advantage from artificial intelligence than health insurers, even as AI becomes a core operating layer across healthcare. Analyst A.J. Rice notes that while managed-care companies like UnitedHealth Group, Elevance Health, Humana, Cigna, and Centene are deploying AI for claims processing, prior authorization, and customer service, those efficiency gains are highly replicable and likely to be competed away through pricing or benefit enhancements. In contrast, large for-profit hospital operators such as HCA Healthcare, Tenet Healthcare, and Universal Health Services are using AI for revenue cycle management, denial appeals, and staffing optimization, and may maintain a multiyear lead over slower-moving nonprofit systems. UBS highlights that Universal Health Services generated approximately $50 million in annualized additional revenue from an AI coding platform, while HCA is using AI to fight claim denials and optimize nurse staffing with a Palantir-built platform. The report concludes that AI will improve profitability unevenly, with hospitals better positioned to retain gains and expand margins over time.
Artificial Intelligence › AI Applications & Copilots ▲Competition
HCA · Technology · Positive UBS highlights HCA's AI use for claim denials and nurse staffing, suggesting durable competitive advantage and margin gains.
UHS · Technology · Positive UBS highlights Universal Health Services' $50M annualized revenue from AI coding platform.
THC · Technology · Positive UBS says hospitals like Tenet may build durable AI advantage, improving profitability.
CI · Competition · Negative UBS says insurers' AI efficiency gains are replicable and will be competed away, limiting margin expansion.
CNC · Competition · Negative UBS says insurers' AI efficiency gains are replicable and will be competed away, limiting margin expansion.
ELV · Competition · Negative UBS says insurers' AI efficiency gains are replicable and will be competed away, limiting margin expansion.
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