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Humana expects Medicare Advantage membership growth of 25% this year, driven in large part by the retention of existing members, said President and CEO Jim Rectin during Wednesday’s Q1 earnings call.
Humana, which has a dominant presence in the MA market rivalled only by UnitedHealthcare, is looking for margin growth of 3%. This would be a doubling of the current MA margin.
The company is focused on retaining members, Rectin said, adding “churn is expensive.”
Humana has made adjustments to benefits to allow for margins during a time of high medical utilization by members. Benefits are being adjusted to have the least impact on what’s important to them, he said.
The resulting financial challenges led MA insurers to cut their footprint, including Humana. The company reduced its footprint from 89% of counties in 2025 to 85% in 2026. It has MA plan offerings in 46 states and Washington, D.C.
For greater efficiency, Humana is centralizing certain teams and automating some processes.
“Right now we are turning our attention to bids,” Rectin said.
Bids for the 2027 plan year are helped by the Centers for Medicare Services change on MA rates. Insurers got a 2.5% increase rather than the proposed .09% increase in the Advance Notice.
Rectin expressed appreciation to CMS on rates that he said would promote more stability in the industry. Nevertheless, he said, the medical cost trend continues to trend higher.
Humana’s net income for the quarter fell to $1.18 million from $1.24 million during the same quarter in 2025. Revenues for Q1 were $39.6 million, compared to $32.1 million in Q1 of 2025. Financials beat Wall Street expectations.
The primary headline, Rectin said, is Humana is on track to meet expectations given during Investor Day in June 2025.
The member growth trajectory is performing as expected, he said. The outlook remains unchanged for better Medicare Advantage star rating results.
Humana is off to a strong start in getting better star ratings, through engagement efforts such as identifying certain chronic conditions among members, Rectin said. The company is about 5% ahead of last year’s Generally Accepted Accounting Principles (GAAP) base on certain HEDIS measures. The Healthcare Effectiveness Data and Information Set (HEDIS) are performance measures that help determine MA star ratings.
Higher star ratings lead to millions in bonus payments.
In October 2025, a Texas court struck down Humana's second lawsuit challenging the Medicare Advantage star ratings released by the Centers for Medicare and Medicaid Services. A reduction from 4 to 3.5 stars in 2024 cost the company more than $1 billion in bonuses that are given to plans that score 4 stars or higher.
Medicaid membership has grown by 50,000 lives due to starts in three states, Michigan, Illinois, and South Carolina.
The company expects a growth of 110,500 patients, or over 22% in CenterWell Senior Primary Care, including approximately 59,000 patients and 54 centers associated with the company’s recently completed acquisition of MaxHealth, a Florida-based platform focused on integrating care.
The company on Monday announced that CenterWell Pharmacy had expanded its partnership with Mark Cuban Cost Plus Drug Company to develop new, end-to-end employer prescription solutions.
Email the writer: SMorse@himss.org