Humana(HUM) - 2024 Q3 - Quarterly Results

Executive Summary Humana's executive summary details 3Q24 financial results, updated full-year 2024 guidance, and key operational highlights 3Q24 Financial Performance Overview Humana reported GAAP EPS of $3.98 and Adjusted EPS of $4.16 for 3Q24, with consolidated pretax results decreasing to $651 million from $1,098 million in 3Q23 Consolidated Pretax Results (in millions) | Metric | 3Q24 (GAAP) | 3Q23 (GAAP) | YTD 2024 (GAAP) | YTD 2023 (GAAP) | |:---|:---|:---|:---|:---| | Consolidated income before income taxes | $651 | $1,098 | $2,583 | $3,974 | | Adjusted (non-GAAP) | $679 | $1,268 | $2,998 | $4,290 | Diluted Earnings Per Share (EPS) | Metric | 3Q24 | 3Q23 | YTD 2024 | YTD 2023 | |:---|:---|:---|:---|:---|\ | GAAP EPS | $3.98 | $6.71 | $15.72 | $24.26 | | Adjusted (non-GAAP) EPS | $4.16 | $7.78 | $18.35 | $26.10 | Full Year 2024 Guidance Update Humana updated its full-year 2024 GAAP EPS guidance to 'at least $12.89' and affirmed Adjusted EPS guidance at 'at least $16.00', maintaining its Insurance segment benefit ratio projection FY 2024 EPS Guidance Update | Metric | FY 2024 Guidance | |:---|:---|\ | GAAP EPS | at least $12.89 | | Adjusted (non-GAAP) EPS | at least $16.00 | - Affirmed FY 2024 Insurance segment benefit ratio of approximately 90 percent[1] Key Operational Highlights Humana increased its 2024 individual Medicare Advantage annual membership growth projection to approximately 265,000 new members, representing about 5 percent growth - Raised 2024 individual Medicare Advantage annual membership growth by 40,000 to approximately 265,000, or approximately 5 percent[1] Consolidated Financial Results This section analyzes Humana's consolidated revenues, EPS, benefit and operating cost ratios, balance sheet, cash flows, and share repurchases Consolidated Revenues Consolidated revenues increased year-over-year, driven by higher Medicare premiums and membership growth, partially offset by declines in group commercial medical and stand-alone PDP membership Consolidated Revenues (in millions) | Metric | 3Q24 | 3Q23 | YTD 2024 | YTD 2023 | |:---|:---|:---|:---|:---|\ | Revenues (GAAP) | $29,397 | $26,423 | $88,548 | $79,912 | | Revenues (Adjusted non-GAAP) | $29,300 | $25,526 | $88,011 | $76,911 | - Favorable year-over-year GAAP consolidated revenues driven by higher per member Medicare premiums and Medicare Advantage and state-based contracts membership growth[10][11] - Partially offset by continued decline in group commercial medical and stand-alone PDP membership[11] Consolidated Earnings Per Share (EPS) Consolidated GAAP EPS for 3Q24 decreased to $3.98 from $6.71 in 3Q23, with year-to-date figures also lower than the prior year Consolidated Diluted EPS | Metric | 3Q24 | 3Q23 | YTD 2024 | YTD 2023 | |:---|:---|:---|:---|:---|\ | EPS (GAAP) | $3.98 | $6.71 | $15.72 | $24.26 | | EPS (Adjusted non-GAAP) | $4.16 | $7.78 | $18.35 | $26.10 | Consolidated Benefit Ratio The consolidated benefit ratio increased year-over-year due to elevated medical cost trends in Medicare Advantage and state-based contracts, partially mitigated by product pricing and benefit design adjustments Consolidated Benefit Expense Ratio | Metric | 3Q24 | 3Q23 | YTD 2024 | YTD 2023 | |:---|:---|:---|:---|:---|\ | Benefits expense ratio (GAAP) | 89.9 % | 86.6 % | 89.2 % | 86.2 % | | Benefits expense ratio (Adjusted non-GAAP) | 89.8 % | 86.4 % | 89.2 % | 86.1 % | - Year-over-year increases in GAAP consolidated benefit ratio primarily due to elevated Medicare Advantage and state-based contracts medical cost trends in 3Q24 and YTD 2024[12] - Elevated medical cost trend partially offset by pricing and benefit design of 2024 Medicare Advantage products, including benefit reductions in response to rate notice and emerging 2023 medical cost trends[13] - Comparisons also reflect a shift in business mix with growth in Medicare Advantage and state-based contracts, which typically have a higher benefit ratio[14] Consolidated Favorable Prior Period Development (in millions) | Metric | First Quarter | Second Quarter | Third Quarter | YTD | |:---|:---|:---|:---|:---|\ | Prior Period Development from prior years recognized in 2024 | $535 | $134 | $24 | $693 | | Decrease to GAAP benefit ratio | (190 bps) | (50 bps) | (10 bps) | (80 bps) | | Prior Period Development from prior years recognized in 2023 | $522 | $232 | $4 | $758 | | Decrease to GAAP benefit ratio | (200 bps) | (90 bps) | (0 bps) | (100 bps) | Consolidated Operating Cost Ratio The consolidated operating cost ratio decreased year-over-year, reflecting scale efficiencies, administrative cost savings, and lower broker commissions, partially offset by value creation initiative charges Consolidated Operating Cost Ratio | Metric | 3Q24 | 3Q23 | YTD 2024 | YTD 2023 | |:---|:---|:---|:---|:---|\ | Operating cost ratio (GAAP) | 11.5 % | 12.5 % | 10.9 % | 11.8 % | | Operating cost ratio (Adjusted non-GAAP) | 11.3 % | 12.0 % | 10.7 % | 11.3 % | - Year-over-year decreases in GAAP consolidated operating cost ratio primarily reflected scale efficiencies from Medicare Advantage membership growth, administrative cost efficiencies from value creation initiatives, lower broker commission expense, and the impact of an accrued litigation charge in 3Q23 and YTD 2023[16] - Partially offset by charges related to value creation initiatives in 3Q24 and YTD 2024, recorded at the corporate level[17] Balance Sheet & Cash Flows Humana's Days in Claims Payable and Debt-to-total capitalization decreased, while GAAP operating cash flows declined year-over-year primarily due to CMS premium payment timing Key Balance Sheet & Cash Flow Metrics | Metric | September 30, 2024 | June 30, 2024 | September 30, 2023 | |:---|:---|:---|:---|\ | Days in Claims Payable (DCP) | 40.7 days | 41.6 days | 43.1 days | | Debt-to-total capitalization | 42.3 % | 43.6 % | 41.1 % (YTD 2023) | - DCP decreased 0.9 days sequentially and 2.4 days year-over-year, driven by a decline in provider accruals and lower reserve requirements[19][20] - Debt-to-total capitalization decreased 130 basis points to 42.3 percent, primarily driven by 3Q24 net earnings[20] Operating Cash Flows (in millions) | Metric | YTD 2024 | YTD 2023 | |:---|:---|:---|\ | Operating cash flows (GAAP) | $3,494 | $11,115 | | Operating cash flows (Adjusted non-GAAP) | $3,494 | $4,042 | - Year-over-year decline in YTD GAAP operating cash flows primarily reflected the early receipt of a $7.1 billion October 2023 premium payment from CMS in September 2023, resulting in ten payments in YTD 2023 compared to nine in YTD 2024[21] Share Repurchases For YTD 2024, Humana repurchased 1,949,838 shares at an average price of $384.65, with $2.93 billion remaining in repurchase authorization Share Repurchase Activity (YTD 2024) | Metric | YTD 2024 | |:---|:---|\ | Total number of shares repurchased | 1,949,838 | | Average price paid per share | $384.65 | | Remaining repurchase authorization (as of Oct 29, 2024) | $2.93 billion | Segment Performance This section analyzes the financial and operational performance of Humana's Insurance and CenterWell segments Humana's Insurance Segment The Insurance segment experienced revenue growth from Medicare premiums and membership, but its benefit ratio increased due to elevated medical costs, while the operating cost ratio improved Insurance Segment Key Financials (in millions, except ratios) | Metric | 3Q24 (GAAP) | 3Q23 (GAAP) | YTD 2024 (GAAP) | YTD 2023 (GAAP) | |:---|:---|:---|:---|:---|\ | Revenues | $28,370 | $25,511 | $85,594 | $77,289 | | Benefits expense ratio | 90.6 % | 87.6 % | 89.8 % | 86.8 % | | Operating cost ratio | 9.2 % | 10.4 % | 8.6 % | 9.9 % | | Income from operations | $274 | $722 | $1,935 | $3,080 | - Insurance segment revenues increased due to higher per member Medicare premiums and Medicare Advantage and state-based contracts membership growth, partially offset by declines in group commercial medical and stand-alone PDP membership[26] - Insurance segment benefit ratio increased due to elevated Medicare Advantage and state-based contracts medical cost trends, partially offset by 2024 Medicare Advantage product pricing and benefit design[28][29] - Insurance segment operating cost ratio decreased due to scale efficiencies from Medicare Advantage membership growth, administrative cost efficiencies from value creation initiatives, and lower broker commission expense[31] Humana's CenterWell Segment The CenterWell segment reported increased revenues from intersegment activity and specialty pharmacy, but its operating cost ratio rose due to the v28 risk model revision, partially offset by efficiencies CenterWell Segment Key Financials (in millions, except ratios) | Metric | 3Q24 (GAAP) | 3Q23 (GAAP) | YTD 2024 (GAAP) | YTD 2023 (GAAP) | |:---|:---|:---|:---|:---|\ | Revenues | $5,041 | $4,660 | $14,806 | $13,695 | | Operating cost ratio | 91.3 % | 90.3 % | 92.1 % | 91.5 % | | Income from operations | $382 | $400 | $1,002 | $1,017 | - CenterWell segment revenues increased due to greater intersegment revenues from Home Solutions, growth in specialty pharmacy, and higher revenues from Primary Care business, partially offset by the v28 risk model revision[36] - CenterWell segment operating cost ratio increased primarily due to the unfavorable impact of the v28 risk model revision to Primary Care business[37] - This increase was partially offset by administrative cost efficiencies from value creation initiatives and positive prior period medical claims development within the Primary Care Organization[37] CenterWell Pharmacy Solutions Metrics (Medicare) | Metric | 3Q24 | 3Q23 | YTD 2024 | YTD 2023 | |:---|:---|:---|:---|:---|\ | Generic Dispense Rate | 90.8 % | 91.8 % | 91.0 % | 91.4 % | | Mail-Order Penetration | 28.1 % | 29.6 % | 28.5 % | 30.0 % | CenterWell Primary Care Growth (September 30, 2024 vs. 2023) | Category | Center Count | Primary Care Providers | Patients Served | |:---|:---|:---|:---|\ | De novo (YoY Growth) | 20.0 % | 10.1 % | 76.1 % | | Wholly-owned (YoY Growth) | (7.7)% | 7.2 % | 16.1 % | | Independent Physician Associations (YoY Growth) | - | - | 2.8 % | | Total (YoY Growth) | 1.7 % | 8.0 % | 20.9 % | CenterWell Home Solutions Admissions (YoY Growth) | Metric | 3Q24 YoY Growth | YTD YoY Growth | |:---|:---|:---|\ | Episodic Admissions | 3.8 % | 8.3 % | | Total Admissions - Same Store | 5.5 % | 9.5 % | Full Year 2024 Financial Guidance This section outlines Humana's updated full-year 2024 financial guidance, including EPS, revenue, membership projections, and key ratios Updated Guidance Summary Humana updated its full-year 2024 GAAP EPS guidance to 'at least $12.89' while affirming Adjusted EPS at 'at least $16.00', with consolidated and segment revenue projections unchanged Full Year 2024 Diluted EPS Projections | Metric | Current Guidance | Prior Guidance | |:---|:---|:---|\ | GAAP EPS | at least $12.89 | approximately $12.81 | | Non-GAAP EPS | at least $16.00 | approximately $16.00 | Full Year 2024 Total Revenues Projections (in billions) | Segment | Current Guidance | Prior Guidance | |:---|:---|:---|\ | Consolidated (GAAP) | no change | approximately $116 | | Insurance segment (GAAP) | no change | approximately $112 | | CenterWell segment (GAAP) | no change | approximately $19 | Membership Projections Individual Medicare Advantage growth guidance was raised to approximately 265,000, while Group Medicare Advantage and state-based contracts growth projections were lowered Full Year 2024 Membership Growth Projections | Membership Type | Current Guidance | Prior Guidance | |:---|:---|:---|\ | Individual Medicare Advantage | Growth of approximately 265,000 | Growth of approximately 225,000 | | Group Medicare Advantage | Growth of approximately 35,000 | Growth of approximately 45,000 | | Medicare stand-alone PDP | no change (Decline of approximately 600,000) | Decline of approximately 600,000 | | State-based contracts | Growth of approximately 200,000 | Growth of approximately 250,000 | Segment Income Projections Insurance and CenterWell segment income from operations guidance remains unchanged for both GAAP and Non-GAAP measures Full Year 2024 Segment Income from Operations Projections (in billions) | Segment | Current Guidance (GAAP) | Current Guidance (Non-GAAP) | |:---|:---|:---|\ | Insurance segment | approximately $1.1 | approximately $1.2 | | CenterWell segment | approximately $1.2 | approximately $1.4 | Key Ratios and Other Metrics Key full-year 2024 projections include an Insurance segment benefit ratio of approximately 90%, a consolidated operating cost ratio of 11.4%, and GAAP cash flows from operations of $2.75 billion Full Year 2024 Key Ratios and Metrics | Metric | Current Guidance | |:---|:---|\ | Benefit Ratio Insurance segment (GAAP) | approximately 90% | | Operating Cost Ratio Consolidated (GAAP) | approximately 11.4% | | Effective Tax Rate (Non-GAAP) | approximately 25.0% | | Weighted Avg. Share Count for Diluted EPS | approximately 121 million | | Cash flows from operations (GAAP) | approximately $2.75 billion | | Capital expenditures (GAAP) | approximately $600 million | Non-GAAP Financial Measures & Reconciliations This section explains Humana's non-GAAP adjustments and provides detailed reconciliation tables for various financial metrics Explanation of Non-GAAP Adjustments Humana utilizes non-GAAP financial measures to present core operating performance, excluding specific items like amortization, valuation adjustments, and litigation charges for consistent analysis - Non-GAAP (Adjusted) financial measures are used to provide a comprehensive perspective for comparing and analyzing core operating performance, serving as consistent indicators for planning and decision-making[43] - Excluded items from non-GAAP measures include: amortization associated with identifiable intangibles, put/call valuation adjustments, impact of exit of employer group commercial medical products business, value creation initiatives, transaction and integration costs, accrued charge related to certain anticipated litigation expenses, and change in fair market value of publicly-traded equity securities[44][45][46] - A cumulative net tax impact of non-GAAP adjustments is also applied to EPS[48] Reconciliation Tables Detailed reconciliations are provided for GAAP to Adjusted (non-GAAP) measures across consolidated and segment revenues, benefit ratios, operating cost ratios, income from operations, and net cash from operating activities Revenues Reconciliation (in millions) | Metric | 3Q24 | 3Q23 | YTD 2024 | YTD 2023 | |:---|:---|:---|:---|:---|\ | CONSOLIDATED | | | | | | GAAP | $29,397 | $26,423 | $88,548 | $79,912 | | Impact of exit of employer group commercial medical products business | (97) | (897) | (537) | (3,000) | | Adjusted (non-GAAP) | $29,300 | $25,526 | $88,011 | $76,911 | | INSURANCE SEGMENT | | | | | | GAAP | $28,370 | $25,511 | $85,594 | $77,289 | | Impact of exit of employer group commercial medical products business | (97) | (897) | (537) | (3,000) | | Adjusted (non-GAAP) | $28,273 | $24,614 | $85,057 | $74,289 | Benefit Ratio Reconciliation | Metric | 3Q24 | 3Q23 | YTD 2024 | YTD 2023 | |:---|:---|:---|:---|:---|\ | CONSOLIDATED | | | | | | GAAP | 89.9 % | 86.6 % | 89.2 % | 86.2 % | | Impact of exit of employer group commercial medical products business | (0.1)% | (0.2)% | — % | (0.1)% | | Adjusted (non-GAAP) | 89.8 % | 86.4 % | 89.2 % | 86.1 % | | INSURANCE SEGMENT | | | | | | GAAP | 90.6 % | 87.6 % | 89.8 % | 86.8 % | | Impact of exit of employer group commercial medical products business | (0.1)% | (0.2)% | — % | — % | | Adjusted (non-GAAP) | 90.5 % | 87.4 % | 89.8 % | 86.8 % | Operating Cost Ratio Reconciliation | Metric | 3Q24 | 3Q23 | YTD 2024 | YTD 2023 | |:---|:---|:---|:---|:---|\ | CONSOLIDATED | | | | | | GAAP | 11.5 % | 12.5 % | 10.9 % | 11.8 % | | Impact of exit of employer group commercial medical products business | (0.1)% | (0.3)% | (0.1)% | (0.3)% | | Value creation initiatives | (0.1)% | (0.2)% | (0.1)% | (0.1)% | | Accrued charge related to certain anticipated litigation expenses | — % | — % | — % | (0.1)% | | Adjusted (non-GAAP) | 11.3 % | 12.0 % | 10.7 % | 11.3 % | | INSURANCE SEGMENT | | | | | | GAAP | 9.2 % | 10.4 % | 8.6 % | 9.9 % | | Impact of exit of employer group commercial medical products business | (0.1)% | (0.4)% | — % | (0.4)% | | Accrued charge related to certain anticipated litigation expenses | — % | (0.1)% | — % | (0.1)% | | Adjusted (non-GAAP) | 9.1 % | 9.9 % | 8.6 % | 9.4 % | Income from Operations Reconciliation (in millions) | Metric | 3Q24 | 3Q23 | YTD 2024 | YTD 2023 | |:---|:---|:---|:---|:---|\ | INSURANCE SEGMENT | | | | | | GAAP | $274 | $722 | $1,935 | $3,080 | | Amortization associated with identifiable intangibles | 4 | 6 | 13 | 17 | | Impact of exit of employer group commercial medical products business | 51 | 51 | 111 | 15 | | Accrued charge related to certain anticipated litigation expenses | — | 15 | — | 105 | | Adjusted (non-GAAP) | $329 | $794 | $2,059 | $3,217 | | CENTERWELL SEGMENT | | | | | | GAAP | $382 | $400 | $1,002 | $1,017 | | Depreciation and amortization expense | 57 | 53 | 166 | 152 | | Adjusted (non-GAAP) | $439 | $453 | $1,168 | $1,169 | Net Cash from Operating Activities Reconciliation (in millions) | Metric | YTD 2024 | YTD 2023 | |:---|:---|:---|\ | GAAP | $3,494 | $11,115 | | Timing of premium payment from CMS | — | (7,073) | | Adjusted (non-GAAP) | $3,494 | $4,042 | Cautionary Statement This section highlights forward-looking statements and various risk factors impacting Humana's business, including regulatory changes, operational challenges, and market competition Forward-Looking Statements and Risk Factors The report contains forward-looking statements subject to risks including product design, benefit expense management, strategic initiative implementation, Star ratings, data security, legal actions, and government regulation - Forward-looking statements are subject to risks, uncertainties, and assumptions, including those detailed in the company's SEC filings[58] - Risks include: inability to design/price products competitively or cover healthcare costs, failure to implement operational/strategic initiatives (Medicare, CenterWell), significant decline in Medicare Advantage Star ratings for 2025 and potential negative impact on 2026 quality bonus payments, data integrity failures or cyber-security attacks, adverse outcomes from legal actions/governmental investigations, and risks associated with government contracts and regulatory changes (e.g., Final RADV Rule)[58][59] - Additional risks include: managing acquisitions/divestitures, maintaining provider relationships, attracting/retaining talented employees, competition and regulatory challenges in the pharmacy business, and potential downgrades in debt ratings[59] About Humana Humana Inc. is dedicated to prioritizing health for its stakeholders, providing care through its insurance and CenterWell health care services to diverse populations including Medicare and Medicaid members - Humana Inc. is committed to putting health first for teammates, customers, and the company[61] - Provides care and service through Humana insurance services and CenterWell health care services to Medicare, Medicaid, families, individuals, military service personnel, and communities[61] Statistical Schedules and Supplementary Information This section provides detailed unaudited statistical schedules and supplementary financial information, including consolidated statements, balance sheets, cash flows, membership details, and segment-specific operational metrics Consolidated Statements of Income This section presents Humana's consolidated statements of income for both year-to-date and three-month periods ending September 30, 2024 and 2023 Consolidated Statements of Income (YTD September 30, 2024 vs. 2023, in millions) | Metric | YTD 2024 | YTD 2023 | |:---|:---|:---|\ | Premiums | $84,354 | $76,144 | | Services | $3,265 | $2,993 | | Investment income | $929 | $775 | | Total revenues | $88,548 | $79,912 | | Benefits | $75,283 | $65,612 | | Operating costs | $9,529 | $9,361 | | Depreciation and amortization | $631 | $578 | | Total operating expenses | $85,443 | $75,551 | | Income from operations | $3,105 | $4,361 | | Net income attributable to Humana | $1,900 | $3,030 | | Diluted earnings per common share | $15.72 | $24.26 | Consolidated Statements of Income (3 Months Ended September 30, 2024 vs. 2023, in millions) | Metric | 3Q24 | 3Q23 | |:---|:---|:---|\ | Premiums | $27,951 | $25,099 | | Services | $1,103 | $1,016 | | Investment income | $343 | $308 | | Total revenues | $29,397 | $26,423 | | Benefits | $25,120 | $21,745 | | Operating costs | $3,339 | $3,271 | | Depreciation and amortization | $210 | $201 | | Total operating expenses | $28,669 | $25,217 | | Income from operations | $728 | $1,206 | | Net income attributable to Humana | $480 | $832 | | Diluted earnings per common share | $3.98 | $6.71 | Consolidated Balance Sheets This section provides Humana's consolidated balance sheets as of September 30, 2024, and December 31, 2023, detailing assets, liabilities, and equity Consolidated Balance Sheets (in millions) | Metric | September 30, 2024 | December 31, 2023 | |:---|:---|:---|\ | Cash and cash equivalents | $5,116 | $4,694 | | Investment securities | $19,033 | $16,626 | | Total current assets | $32,926 | $29,986 | | Total assets | $50,007 | $47,065 | | Benefits payable | $11,125 | $10,241 | | Total current liabilities | $18,727 | $18,872 | | Long-term debt | $11,886 | $10,213 | | Total liabilities | $32,383 | $30,747 | | Total stockholders' equity | $17,565 | $16,262 | | Total equity | $17,624 | $16,318 | | Debt-to-total capitalization ratio | 42.3 % | 41.8 % | Consolidated Statements of Cash Flows This section presents Humana's consolidated statements of cash flows for the year-to-date periods ending September 30, 2024 and 2023 Consolidated Statements of Cash Flows (YTD September 30, 2024 vs. 2023, in millions) | Metric | YTD 2024 | YTD 2023 | |:---|:---|:---|\ | Net cash provided by operating activities | $3,494 | $11,115 | | Net cash used in investing activities | ($2,889) | ($2,610) | | Net cash (used in) provided by financing activities | ($183) | $1,582 | | Increase in cash and cash equivalents | $422 | $10,087 | | Cash and cash equivalents at end of period | $5,116 | $15,148 | Consolidating Statements of Income - Quarter This section provides consolidating statements of income for Humana's Insurance and CenterWell segments for the three months ended September 30, 2024 and 2023 Consolidating Statements of Income (3 Months Ended September 30, 2024, in millions) | Metric | Insurance | CenterWell | Eliminations/Corporate | Consolidated | |:---|:---|:---|:---|:---|\ | Total revenues | $28,370 | $5,041 | ($4,014) | $29,397 | | Benefits | $25,319 | — | ($199) | $25,120 | | Operating costs | $2,595 | $4,602 | ($3,858) | $3,339 | | Income from operations | $274 | $382 | $72 | $728 | | Benefit ratio | 90.6 % | - | - | 89.9 % | | Operating cost ratio | 9.2 % | 91.3 % | - | 11.5 % | Consolidating Statements of Income (3 Months Ended September 30, 2023, in millions) | Metric | Insurance | CenterWell | Eliminations/Corporate | Consolidated | |:---|:---|:---|:---|:---|\ | Total revenues | $25,511 | $4,660 | ($3,748) | $26,423 | | Benefits | $21,976 | — | ($231) | $21,745 | | Operating costs | $2,634 | $4,207 | ($3,570) | $3,271 | | Income from operations | $722 | $400 | $84 | $1,206 | | Benefit ratio | 87.6 % | - | - | 86.6 % | | Operating cost ratio | 10.4 % | 90.3 % | - | 12.5 % | Consolidating Statements of Income - YTD This section presents consolidating statements of income for Humana's Insurance and CenterWell segments for the nine months ended September 30, 2024 and 2023 Consolidating Statements of Income (9 Months Ended September 30, 2024, in millions) | Metric | Insurance | CenterWell | Eliminations/Corporate | Consolidated | |:---|:---|:---|:---|:---|\ | Total revenues | $85,594 | $14,806 | ($11,852) | $88,548 | | Benefits | $75,752 | — | ($469) | $75,283 | | Operating costs | $7,354 | $13,638 | ($11,463) | $9,529 | | Income from operations | $1,935 | $1,002 | $168 | $3,105 | | Benefit ratio | 89.8 % | - | - | 89.2 % | | Operating cost ratio | 8.6 % | 92.1 % | - | 10.9 % | Consolidating Statements of Income (9 Months Ended September 30, 2023, in millions) | Metric | Insurance | CenterWell | Eliminations/Corporate | Consolidated | |:---|:---|:---|:---|:---|\ | Total revenues | $77,289 | $13,695 | ($11,072) | $79,912 | | Benefits | $66,096 | — | ($484) | $65,612 | | Operating costs | $7,597 | $12,526 | ($10,762) | $9,361 | | Income from operations | $3,080 | $1,017 | $264 | $4,361 | | Benefit ratio | 86.8 % | - | - | 86.2 % | | Operating cost ratio | 9.9 % | 91.5 % | - | 11.8 % | Membership Detail This section provides detailed medical membership figures, including Individual and Group Medicare Advantage, Medicare stand-alone PDP, and membership mix as of September 30, 2024 and 2023 Medical Membership (in thousands) | Membership Type | Sep 30, 2024 | Sep 30, 2023 | Dec 31, 2023 | |:---|:---|:---|:---|\ | Individual Medicare Advantage | 5,659.2 | 5,374.4 | 5,408.9 | | Group Medicare Advantage | 546.7 | 510.3 | 509.6 | | Total Medicare Advantage | 6,205.9 | 5,884.7 | 5,918.5 | | Medicare stand-alone PDP | 2,315.7 | 2,885.8 | 2,849.1 | | Total Medical Membership | 16,358.1 | 16,963.5 | 16,857.8 | Individual Medicare Advantage Membership Mix (Sep 30, 2024 vs. 2023) | Metric | Sep 30, 2024 | Sep 30, 2023 | |:---|:---|:---|\ | HMO | 51 % | 53 % | | PPO/PFFS | 49 % | 47 % | | Shared Risk | 37 % | 35 % | | Path to Risk | 33 % | 34 % | | Total Value-based | 70 % | 69 % | Premiums and Services Revenue Detail This section details premiums and services revenue for Humana's Insurance and CenterWell segments for both quarterly and year-to-date periods ending September 30, 2024 and 2023 Premiums and Services Revenue Detail (3 Months Ended September 30, 2024 vs. 2023, in millions) | Segment/Type | 3Q24 | 3Q23 | Dollar Change | Percentage Change | |:---|:---|:---|:---|:---|\ | Insurance | | | | | | Individual Medicare Advantage | $21,856 | $19,637 | $2,219 | 11.3 % | | Group Medicare Advantage | $1,913 | $1,695 | $218 | 12.9 % | | Medicare standalone PDP | $721 | $493 | $228 | 46.2 % | | State-based contracts and other | $2,921 | $1,995 | $926 | 46.4 % | | Total Insurance | $28,178 | $25,357 | $2,821 | 11.1 % | | CenterWell | | | | | | Pharmacy solutions | $2,933 | $2,797 | $136 | 4.9 % | | Primary care | $1,257 | $1,068 | $189 | 17.7 % | | Home solutions | $851 | $795 | $56 | 7.0 % | | Total CenterWell | $5,041 | $4,660 | $381 | 8.2 % | Premiums and Services Revenue Detail (9 Months Ended September 30, 2024 vs. 2023, in millions) | Segment/Type | YTD 2024 | YTD 2023 | Dollar Change | Percentage Change | |:---|:---|:---|:---|:---|\ | Insurance | | | | | | Individual Medicare Advantage | $66,519 | $59,195 | $7,324 | 12.4 % | | Group Medicare Advantage | $5,840 | $5,192 | $648 | 12.5 % | | Medicare stand-alone PDP | $2,409 | $1,677 | $732 | 43.6 % | | State-based contracts and other | $7,756 | $5,966 | $1,790 | 30.0 % | | Total Insurance | $85,072 | $76,904 | $8,168 | 10.6 % | | CenterWell | | | | | | Pharmacy solutions | $8,635 | $8,509 | $126 | 1.5 % | | Primary care | $3,666 | $3,101 | $565 | 18.2 % | | Home solutions | $2,505 | $2,085 | $420 | 20.1 % | | Total CenterWell | $14,806 | $13,695 | $1,111 | 8.1 % | CenterWell Segment - Pharmacy Solutions This section provides specific operational metrics and details for the CenterWell segment's Pharmacy Solutions business CenterWell Segment - Primary Care This section provides specific operational metrics and details for the CenterWell segment's Primary Care business CenterWell Segment - Home Solutions This section provides specific operational metrics and details for the CenterWell segment's Home Solutions business Footnotes to Statistical Schedules This section contains explanatory footnotes pertaining to the statistical schedules and supplementary financial information provided