Humana’s Strategy for Boosting Medicare Advantage Profitability
A central theme in Humana’s plan for boosting Medicare Advantage profitability in the future is a strategy its peers have relied on for over a decade: coaxing members in for their annual wellness visits.
The Medicare Advantage business has come under scrutiny recently for its impact on the federal budget, with calls to limit insurers’ tactics for maximizing government payments. However, Humana remains optimistic about the profitability of Medicare Advantage and believes that doubling down on proven strategies is the key to success.
At a recent investor day in Louisville, Ky., Humana leaders emphasized the importance of annual wellness visits for their members. George Renaudin, President of Humana’s insurance business, highlighted the benefits of these visits, stating that seniors appreciate the convenience and personalized attention they receive during these appointments.
While some critics argue that annual wellness visits are primarily used by insurers to increase government payments, Humana is focused on enhancing the member experience and improving health outcomes. Lisa Stephens, Chief Operating Officer of Humana’s insurance division, announced a new partnership with the company’s primary care subsidiary to embed clinical insights into providers’ workflow systems.
Humana’s approach to increasing annual wellness visits will involve proactive outreach to members, including scheduling visits during phone calls to ensure convenience and accessibility. This proactive engagement strategy is similar to the approach taken by UnitedHealth Group, the largest Medicare Advantage insurer, which has seen success in increasing diagnostic codes through home and clinic visits.
One concern with annual wellness visits is that they may lead to higher payments for insurers without resulting in additional care for members. A federal watchdog report found that insurers collected billions of dollars in 2023 from diagnoses added during health risk assessments without evidence of treatment. Humana, along with UnitedHealth, received a significant amount from these assessments.
Jim Rechtin, Humana’s CEO, emphasized the company’s focus on becoming a senior services business, not just a health insurer. With a large Medicare Advantage market share and a senior primary care business under the CenterWell brand, Humana is well-positioned to provide comprehensive care to older adults.
Looking ahead, Rechtin highlighted the importance of accurate diagnoses, follow-up care, and improved clinical outcomes in reducing expenses and improving the company’s Medicare margin. By focusing on quality care and member retention, Humana aims to drive long-term profitability and success in the Medicare Advantage market.
