Louisville, Ky.-based Humana reported a fourth quarter consolidated revenue of $12.9 billion in 2016, falling 4 percent from $13.4 billion in the same period last year.
The payer attributed the year-over-year decrease in revenue to a premium reduction of approximately $583 million related to a write-off of money it was supposed to receive under the government's risk corridor program and a loss of premium revenue in its Medicare and individual commercial businesses.
Humana reported a full-year 2016 consolidated revenue of $54.4 billion, a slight increase from the $54.3 billion in consolidated revenue it received last year. The payer said the increase reflected higher average membership and per member premium increases for certain business lines.
"We are proud of our strong 2016 operating results, particularly given the complex operating environment during the extended transaction process," said Bruce Broussard, president and CEO of Humana.
The payer postponed releasing its 2017 financial guidance until next week to review a federal judge's decision to block the payer's pending $37 billion transaction with Hartford, Conn.-based Aetna. Humana will discuss its guidance and any updates on the transaction no later than Feb. 16, one day after the companies' acquisition deadline.
The insurer also reported an adjusted consolidated pretax income of $643 million in Q4 2016, a 42 percent jump from the same period last year due to year-over-year improvement in its individual Medicare Advantage business and higher operating earnings in its healthcare services segment.
In addition, the payer shouldered a consolidated pretax loss of $486 million in Q4 2016, compared to its $246 million income during the same period last year. Humana attributed the loss in part to the risk corridor receivables write-off.
The insurer's individual commercial membership dropped 27 percent to 654,800 from the end of 2015 to the end of 2016, while its individual Medicare Advantage membership increased 3 percent to 2.8 million during the same period.
The company also said James Murray, executive vice president and COO of Humana, will retire effective March 31. He will serve as an advisor to the company through the end of the year. The company is not looking to fill the role at this time.