Humana Inc. (NYSE: HUM) will be exiting 13 Medicare Advantage (MA) markets in 2025, company leaders said during the Wells Fargo Healthcare Conference. The company had already announced that it was planning to leave markets next year, but offered up more specifics last week.
Humana CFO Susan Diamond said the company’s exit from those 13 markets would affect about 560,000 members, or around 10% of its individual MA membership base. Diamond did say, however, that she expects many of those members to join other Humana MA plans.
“The exit itself is positive in the sense that those plans were not contributing,” Diamond said at the conference. “If we do ultimately retain more of those members, that’s incrementally positive because the plan choices left behind are priced in a way that will be positively contributing.”
Diamond first teased this move earlier this year, after the Centers for Medicare & Medicaid Services (CMS) released its final rule for MA plans, which again included a net negative payment adjustment.
“As we think about the decisions for ‘25 bids, we do intend to exit some counties,” Diamond said at the time. “When we thought about the framework of how we make those decisions, a primary input was the profitability of the plan.”
After years of positive payment adjustments – and lower health care utilization costs during the pandemic – MA plans are now facing a harsher economic environment.
That has the chance to contribute to a “leveling off” of MA penetration, which has been steady over the last decade.
Centene Corp. (NYSE: CNC) also announced recently that it is set to pull back on MA in at least six states next year, as did BlueCross BlueShield.
For home health providers and home care providers, a tougher payment environment for MA plans could mean less leeway for higher rates for services.
At the same time, home health providers that believe subpar MA rates are a threat to their businesses could experience some respite in the near term.
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