Quality ratings hit to key Medicare plan shakes Humana stock
Shares of Humana tumbled early Wednesday after the health insurer said a Medicare Advantage quality rating drop will hurt future bonus payments the company receives
Shares of Humana tumbled Wednesday after the health insurer said a Medicare Advantage quality rating drop will hurt future bonus payments the company receives.
The insurer said the share of its customers currently enrolled in plans rated four stars or higher for 2025 is down to 25% from 94% this year. Humana said the rating on a large, national insurance plan that contains 45% of Humana’s enrollment fell a point to 3.5 points.
Medicare Advantage plans are privately run versions of the federal government’s Medicare program mostly for people age 65 and older. An annual enrollment window for 2025 coverage starts Oct. 15. Shoppers will have until December 7 to settle on coverage for next year.
BTIG analyst David Larsen said in a research note that Humana's ratings were disappointing given that Medicare Advantage plans already are dealing with challenges like higher claims cost and more inpatient hospital visits.
Humana Inc. said in a regulatory filing that it was talking to federal officials about the reduction. The company said it also is focused on improving its performance to regain its star rating.
Humana, one of the biggest providers of Medicare Advantage coverage, said the ratings drop will not affect its results or outlook for this year and next. The company said it would explore all options to mitigate the revenue hit it expects to take in 2026 from a drop in bonus payments due to the rating change.
The Louisville, Kentucky, company’s stock shed about $60 in value Wednesday after markets opened. The price dropped more than 21% to $219.27.
Shares had
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