The major payer will concentrate its focus on its Medicare and Medicaid health plan offerings.
Humana will leave its employer group commercial medical products business to shift its full attention to its core insurance lines, the company announced.
The exit from the market will be phased over the next 18 to 24 months, the health insurer specified, and will include abandoning all fully insured, self-funded, and Federal Employee Health Benefit plans, as well as associated wellness and rewards programs.
Humana stated the decision comes after a strategic review, which determined the "business was no longer positioned to sustainably meet the needs of commercial members over the long term or support the company’s long-term strategic plans."
The payer can now put all of its efforts into its Medicare and Medicaid plans, including its Medicare Advantage (MA) offering. In a recent study by the American Medical Association found that Humana had the second-largest MA market share at 19%, behind only UnitedHealth Group.
"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 customers," Bruce D. Broussard, Humana president and CEO, said in a statement. "It is in line with the company's strategy to focus our health plan offerings primarily on Government-funded programs (Medicare, Medicaid and Military) and Specialty businesses, while advancing our leadership position in integrated value-based care and expanding our CenterWell healthcare services capabilities.
"We are confident in Humana's continued success, and our commitment to improving the health of those we serve is unwavering."
Last year, Humana restructured by splitting into two business units, insurance services and CenterWell, as part of its goal to generate $1 billion of value to pour into its MA and Medicaid businesses.
The announcement came six months after Humana stock fell by 21%, as the payer slashed MA enrollment projections roughly in half.
Jay Asser is the contributing editor for strategy at HealthLeaders.
KEY TAKEAWAYS
In the next 18 to 24 months, Humana will shutter its employer group commercial medical products business.
The decision comes after a strategic review determined the business could no longer meet members' needs or support the payer's long-term plans.
Humana will focus on its main offerings like Medicare Advantage, which has been a priority in the company's strategic moves.