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Humana will leave the commercial health insurance market and focus its efforts on government-sponsored products such as Medicare Advantage, the company announced Thursday.
The insurer will phase out its fully insured, self-funded and Federal Employees Health Benefits Program plans, along with its wellness and rewards offerings, over the next 24 months, according to a news release. Humana did not disclose the value of its employer business.
Humana does not expect the decision to affect financial performance this year. The insurer will continue to serve the Medicare Advantage, Medicare Part D, Medicare supplement, Medicaid and TRICARE markets and retain its dental, vision and life insurance products.
Humana did not immediately respond to an interview request.
“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 our customers,” Humana CEO Bruce Broussard said in the news release. “It is in line with the company’s strategy to focus our health plan offerings primarily on government-funded programs and specialty businesses, while advancing our leadership position in integrated value-based care and expanding our CenterWell healthcare services capabilities.”
Humana’s employer-sponsored plans had 986,400 policyholders at the end of 2022, down nearly 16%, and the company expected membership to decline by another 300,000 this year “as we remain focused on optimizing our cost structure and margin in this line of business,” Chief Financial Officer Susan Diamond said during the company’s fourth-quarter earnings call this month.
Humana is restructuring as part of a $1 billion plan to grow its Medicare Advantage business. Humana is the second-largest Medicare Advantage carrier with 5.1 million enrollees. Medicare Advantage membership grew nearly 14% for the current plan year, nearly five times the industry average.
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