Skip to content
Breaking News

Breaking News

  • Home
  • World
  • Business
  • Health
  • Entertainment
  • Life Style
  • Sports
  • Toggle search form

Humana stock plunges on dismal 2024 forecast, as insurers face soaring medical costs

Posted on January 25, 2024 By Admin No Comments on Humana stock plunges on dismal 2024 forecast, as insurers face soaring medical costs


A Humana Inc. office building in Louisville, Kentucky, Feb. 3, 2019.

Bloomberg | Bloomberg | Getty Images

Shares of Humana plummeted Thursday after the health insurer issued dismal full-year earnings guidance, citing soaring medical costs that are dogging the broader insurance industry.

Those expenses have spiked as an increasing number of older adults return to hospitals to undergo procedures they had delayed during the pandemic, such as joint and hip replacements. 

Humana, which primarily provides government-backed insurance through the Medicare Advantage program, said it expects adjusted earnings of about $16 per share for 2024. That’s a little more than half of the $29.10 per share that analysts expected, according to LSEG, formerly known as Refinitiv. 

The guidance adds to Wall Street’s concerns about health insurance company profits falling as medical costs jump. UnitedHealth on Friday also reported its own jump in medical costs, though it was less extreme than Humana’s.

Humana shares closed 10% lower Thursday.

Its forecast dragged down other health insurance stocks. Shares of both UnitedHealth and CVS Health closed around 4% and 3% lower, respectively. Cigna’s stock closed almost 2% lower, and Centene shares ended more than 2% lower.

Elevance Health closed more than 1% higher on Thursday. Unlike Humana, the insurer forecast 2024 earnings above estimates Wednesday, after higher premiums in its commercial business helped control medical costs in the fourth quarter.

Expectations for Humana’s 2024 earnings guidance were already low after the company warned last week that medical costs were running higher than expected in the fourth quarter. It signaled that higher expenses could cut into its profits in the year ahead. 

Humana confirmed that pessimism Thursday. It reported a medical benefit ratio — the percentage of payout on claims compared with premiums — of 90.7% for the fourth quarter. Analysts had estimated that the ratio would be 89.7% for the period, according to LSEG.

The insurer cited an increase in outpatient services, such as orthopedic surgeries, and in inpatient care in November and December among patients enrolled in Medicare Advantage. 

Medicare Advantage plans are privately run versions of the federal government’s Medicare program, mostly for people ages 65 and older. Those plans are one of Humana’s biggest forms of coverage outside insurance it provides for military families and retirees.

Humana posted fourth-quarter revenue of $26.46 billion, which beat analysts’ estimate of $25.42 billion, according to LSEG data. 

But the company posted a loss of $591 million, or $4.42 per share, in the fourth quarter. That compares with a loss of $71 million, or 12 cents per share, during the same period a year ago. 

Excluding certain items, Humana reported a loss of 11 cents per share. Analysts had expected the company to post earnings of 15 cents per share, according to LSEG.



Source link

Health Tags:Biotech and Pharmaceuticals, Biotechnology, Breaking news, Business, business news, Centene Corp, Cigna Corp, CVS Health Corp, Earnings, Elevance Health Inc, Health care industry, Humana Inc, Pharmaceuticals, Social issues, UnitedHealth Group Inc

Post navigation

Previous Post: California homeless found living in furnished caves 20 feet below street level
Next Post: Met Opera Taps Its Endowment Again to Weather Downturn

More Related Articles

India pharma exports soaring despite cough syrup deaths, trade body says – Reuters News Agency Health
China reports no ‘unusual or novel pathogens’ after WHO seeks data on respiratory illness outbreak Health
Woman needed HIV test after GP used old genital swab Health
A study to devise nutritional guidance just for you Health
Many are betting Ozempic will reduce the need for knee surgery. What it means if they’re wrong Health
Eli Lilly sues four telehealth sites selling compounded Zepbound, Mounjaro Health

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recent Posts

  • PHF seeks govt funds for hotel accommodation in Kuala Lumpur: sources
  • Abortion guidelines branded horrifying by grieving mum
  • Woman declared dead by coroner, moved to coffin, turns out to be alive
  • Shohei Ohtani reacts to death of Japanese baseball legend Shigeo Nagashima: ‘May your soul rest in peace’
  • Thames Water nationalisation ‘not the answer’ says minister after rescue bid fails

Categories

  • Business
  • Entertainment
  • Health
  • Life Style
  • Sports
  • World

Copyright © 2025 Breaking News.

Powered by PressBook Blog WordPress theme