’25 Stars Info Spooks Humana Investors, Stokes Fears About Industry Decline

  • Oct 03, 2024

    “Truly shocking” and “huge setback” were just two of a flood of analyst reactions to Humana Inc.’s Oct. 2 disclosure that its percentage of Medicare Advantage members in plans with 4 or more stars will plummet to 25% next year. That’s down from an estimated 94% for 2024 and is largely the result of a decline in Star Ratings for its largest contract, according to a new filing from Humana. Although the full set of Star Ratings data won’t be released until next week, this development confirmed industry fears that rising cut points will diminish ratings — and related revenue.  

    In advance of the Medicare Annual Election Period that starts on Oct. 15, preliminary Stars data became available in the CMS Medicare Plan Finder on Oct. 1. According to Humana’s filing with the U.S. Securities and Exchange Commission (SEC), contract H5216 fell from a 4.5-star rating to a 3.5-star rating for next year, which impacts quality bonus payments in 2026. That contract holds approximately 45% of Humana’s MA membership, including more than 90% of its group MA membership, Humana clarified.

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  • Lauren Flynn Kelly

    Lauren has been covering health business issues since the early 2000s and specializes in in-depth reporting on Medicare Advantage, managed Medicaid and Medicare Part D. She also possesses a deep understanding of the complex world of pharmacy benefit management, having written AIS Health’s Radar on Drug Benefits from 2004 to 2005 and again from 2011 to 2016. In addition to her role as managing editor of Radar on Medicare Advantage, she oversees AIS Health’s publications and manages the health editorial staff. She graduated from Vassar College with a B.A. in English.

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