25 things to know about Humana

Humana was incorporated in the 1960s as a healthcare company, and the business has grown to offer several insurance products and health and wellness services. Louisville, Ky.-based Humana is now among the major national commercial payers.

Here are 25 things to know about Humana.

Company basics

1. Major players in Humana's past and present include:

  • Founders David A. Jones, Sr. and H. Wendell Cherry, who were attorneys.
  • CEO Bruce D. Broussard, who, prior to Humana, worked within a variety of healthcare sectors, including oncology, pharmaceuticals, assisted living/senior housing, home care, physician practice management, surgical centers and dental networks. 
  • CFO Brian Kane, whose previous health insurance work has included coverage of the national and government-focused managed care organizations.
  • Board Chairman Kurt J. Hilzinger, a partner with New York City-based private equity firm Court Square Capital Partners.  

2. Humana began as a nursing home company called Extendicare.

3. The company's focus shifted to hospitals, and the name was changed to Humana in 1974.

4. Humana has medical membership in all 50 states, Washington, D.C. and Puerto Rico.

5. As of Dec. 31, 2013, Humana had approximately 12 million medical plan members and roughly 7.8 million specialty products members.

Will a competing insurer acquire Humana?

6. Humana has recently garnered widespread media attention, as there have been whispers of Humana possibly being acquired by a competing health insurer.

7. Humana is exploring a possible sale of the company after Cigna approached the health insurer about a potential deal, according to a Bloomberg report. Along with Cigna, Aetna has also shown interest in taking over Humana, according to The Wall Street Journal.

8. Major insurers are interested in acquiring Humana due to the bulk of the company's revenue coming from administering Medicare Advantage plans, which is an area other insurers are looking to expand.

9. Goldman Sachs Group is advising Humana on the possible sale.

Finances

10. Humana reported net income of $430 million on $13.8 billion in revenue for the first quarter of fiscal 2015, up from net income of $368 million on $11.7 billion in revenue a year earlier.

11. Humana has been involved in various transactions this year. In April, Humana announced its home care division, Humana At Home, had acquired Deerfield Beach, Fla.-based Your Home Advantage, a nurse practitioner home health service.

12. In March, Humana announced it was selling Concentra, its occupational health and physical therapy services arm, for $1.06 billion.

13. Humana is expecting a 0.8 percent increase in funding from the final Medicare Advantage payment rates for 2016 that CMS recently announced.

Accountable care agreements

14. Humana has entered into many accountable care agreements. In March, Brookfield-based Integrated Health Network of Wisconsin in March agreed to partner with Humana on a three-year accountable care agreement for Humana's Medicare Advantage beneficiaries.

15. In February, Humana announced a new multi-year accountable care agreement with HealthSpan Physicians, a network of 200 primary care physicians based in Cincinnati.

16. As of March, 53 percent of Humana's members were in accountable care relationships.

17. Humana's accountable care relationships have seen some signs of success: Within its accountable care continuum, Humana reported improved costs, decreased ER visits, decreased inpatient admissions and better screening compliance for various measures like cholesterol and colorectal cancer, compared to Humana members treated in traditional, fee-for-service and original Medicare settings.

18. As of March, Humana was on course to have more than 75 percent in accountable care relationships by 2017.

Rankings, disputes and initiatives

19. In the 2015 edition of athenahealth's PayerView report, Humana ranked first overall among major payers and was the only national commercial payer in the Top 10. Payers were ranked based on metrics such as days in accounts receivable, claim resolution rate, denial rate and more.

20. Humana was rated the No. 1 plan in overall member satisfaction for the East South Central region of the United States, according to the annual J.D. Power Member Health Plan Study. The study, which is in its ninth year, measures satisfaction among members of 134 health plans in 18 regions across the U.S. The study examines six factors: coverage and benefits, provider choice, information and communication, claims processing, cost, and customer service. Member satisfaction is calculated on a 1,000-point scale.

21. Humana has been part of disputes with hospitals. It was announced in February that a 20-year relationship between Humana and the University of Chicago Medicine would come to an end April 1, affecting approximately 1,750 patients.

22. Humana has recently been part of legal proceedings. Humana disclosed in a regulatory filing that it was the subject of a federal probe, which is related to a whistle-blower lawsuit filed against the health insurer. According to the filing, the U.S. Department of Justice issued an information request to Humana concerning the health insurer's Medicare Part C risk adjustment practices.

23. Humana is among payers that joined the Health Care Payment Learning and Action Network, an advisory group that was established to provide a forum for public-private partnerships to help the U.S. healthcare payment system meet or exceed recently established Medicare goals for value-based payments and alternative payment models.

24. Humana launched two population health management services suites this year. In March, the insurer announced the formation of Transcend and Transcend Insights, extended suites of management services designed to assist healthcare systems, physicians and care teams in improving population health management efforts.

Thoughts on Humana

25. A number of healthcare industry experts have commented on Humana this year. Below are some of their comments.

  • "Our first-quarter achievements included substantial revenue and membership growth, announcement of the launch of our population health technology business Transcend Insights, the pending sale of Concentra and the completion of our accelerated share repurchase program, as well as strong pretax income," Mr. Broussard said when Humana released its first-quarter financial results. "These achievements contributed meaningfully to the advancement of our integrated care delivery model with its data-driven focus on the consumer, powered by our disciplined approach to capital allocation — which, taken together, represents a sustainable competitive advantage for Humana."
  • "Humana has long been thought of as the national leader in Medicare advantage plans.  It has seemed bit to lose share in some commercial markets but has doubled down in this area quite successfully," said Scott Becker, JD, publisher of Becker's Healthcare.

 

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