Humana Excels in Q2, Guidance Raised Accordingly

Strong performance in the Medicare Advantage membership pool prompted the Louisville-based insurer to update its guidances for the end of the year.

Humana Inc. posted decent Q2 financials, supported by $19 million in GAAP pretax income and $812 million in adjusted non-GAAP income, according to their earnings report released Wednesday morning.

A positive base of support from inpatient use of Medicare Advantage services increased Humana's retail segment benefit ratio guidance, while the Louisville-based insurer also increased its adjusted diulted earnings per share by $0.25. Humana now projects adjusted diluted earnings per share totalling $14.15 and GAAP diluted earnings per share of $11.52 for the end of 2018.

"Our strong 2018 financial results are testimony to the underlying improvement in our operating metrics, like Net Promoter Score, digital self-service utilization and call transfer reduction, and to the growing effectiveness of our national and local clinical programs," Bruce Broussard, CEO of Humana, said in a statement. "Also, we took another large step this quarter in helping our members, especially those living with chronic conditions, by beginning the integration of important clinical services through our investments in Kindred at Home and Curo, and through our partnership with Walgreens."

Humana's performance was supported primarily by Medicare Advantage membership growth, while the company also finalized its purchase of Kindred Healthcare in an effort to expand its hospice services.

Below are highlights from Huamana's Q2 earnings report:

Humana paid cash dividends of $69 million in Q2, up from $57 million during Q2 2017.
Retail segment revenues for Humana totalled $12 billion for Q2, a 7% increase compared to this time last year.
The insurer's individual Medicare Advantage membership was just north of 3 million patients at the end of Q2, an increase of 187,000 members compared to Q2 2017.

Additional information is available in Humana's filing with the Securities and Exchange Commission.

Jack O'Brien is the Content Team Lead and Finance Editor at HealthLeaders, an HCPro brand.