Humana also reported $16.2 billion in total revenues, an increase of $2 billion year-over-year.
Humana continues to ride the strength of its Medicare Advantage offerings, raising its projected membership growth to between 480,000 and 500,000 members for the full year 2019, according to its latest earnings report released Wednesday morning.
At the end of Q2, Humana had an individual Medicare Advantage membership of nearly 3.5 million, with group Medicare Advantage membership of 519,000.
During the quarter, Humana reported total revenues of $16.2 billion, a $2 billion increase year-over-year, while its earnings per share (EPS) rose from $1.39 to $6.94.
As a result of its strong performance at the midway point of 2019, the Louisville-based insurer again updated its EPS guidance for the full year, projecting a range around $17.97 per share, with an adjusted EPS of $17.60.
"We are pleased to deliver strong results in a year Humana is experiencing the highest individual Medicare Advantage membership growth we have seen in the last decade, which is reflective of our operating discipline and execution, investments in our integrated care delivery strategy, and our relentless focus on creating a simple and personalized healthcare experience for our members" Bruce Broussard, CEO of Humana, said in a statement.
Humana's adjusted pre-tax income totaled just over $1 billion, up from $812 million in Q2 2018.
Unlike Q1, Humana's operating cash flows rose considerably. The company reported cash flows of $1.4 billion, reversing course from a $125 million negative cash flow this time last year.
The day before releasing its Q2 earnings, Humana announced the expansion of its neighborhood health collaboration with Walgreens.
During Q2, Humana secured one major business partnership while downplaying speculation about another one.
In mid-June, Humana and Epic Systems announced plans to collaborate on value-based care by integrating the insurer's real-time benefits check tool with the electronic health records company's e-prescribing workflow.
Ryan Bohochik, Epic's director of value-based care, told HealthLeaders that the partnership is slated to deliver real-time pharmacy data and cost information while improving timeliness for prior authorization decisions.
"It should also help revenue cycle professionals reduce the time they spend on administrative tasks like requesting prior authorizations, so they can focus on areas that are more impactful for their patients," Bohochik said.
Humana also denied rumors that it was interested in acquiring Centene Corp. after its pending merger with Tampa-based WellCare Health Plans hit a speed bump with the Department of Justice in late May.
In a public filing with the Securities and Exchange Commission (SEC), Humana wrote that while it typically does not comment on speculation about M&A activity, it would shoot down the groundswell about a Centene purchase.
"...the Company has chosen to make a one-time, limited exception to its no-comment policy (which continues in effect) and confirm that the Company will not make a proposal to combine with Centene as an alternative to Centene's proposed transaction with WellCare Health Plans, Inc.," the filing states.
ADDITIONAL HUMANA Q2 EARNINGS REPORT HIGHLIGHTS:
- Retail segment revenues again topped $14 billion, up more than $2 billion compared to this time last year.
- Debt-to-capitalization ratio dropped from 33.6% in Q2 2018 to 32.5%.
- Healthcare services segment revenues reached $6.4 billion, with segment earnings of $224 million, both year-over-year increases.
For complete financial information, review Humana's filing with the SEC.
Jack O'Brien is the finance editor at HealthLeaders, a Simplify Compliance brand.