Humana is targeting ambitious growth of its Medicare Advantage plans and primary care clinics over the next three years, which executives said Thursday will significantly propel Humana’s profitability. Humana’s stock price ended the day up 8%, valuing the company at $63 billion.
The main purpose of Humana’s messaging was to comfort Wall Street over concerns the company was losing ground in the booming Medicare Advantage market. Earlier this year, Humana cut its MA enrollment projections for 2022 in half after a lot of people terminated their plans during last year’s annual enrollment. Humana’s stock tanked promptly after that disclosure.
The slow enrollment this year not only created concerns among financial investors about Humana’s operations. It also raised questions about whether Medicare Advantage — the controversial private alternative to traditional Medicare — was becoming a saturated market. Almost half of all Medicare beneficiaries are in an MA plan now after a decade of frenzied growth, but enrollment will inevitably peak and slow down.
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