Company: HUM
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0000049071-25-000057
Chunk: 18

Company: HUMANA INC
Filing Date: 2025-11-05
Form: 10-Q
Item: Item 2
Chunk 18
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 $28.0 billion in the 2025 quarter and increased $6.8 billion, or 9.0%, from $75.3 billion in the 2024 period to $82.1 billion in the 2025 period. The consolidated benefit ratio increased 120 basis points from 89.9% for the 2024 quarter to 91.1% for the 2025 quarter and increased 10 basis points from 89.2% for the 2024 period to 89.3% for the 2025 period primarily reflecting a shift in line of business mix resulting growth in the state-based contracts and stand-alone PDP businesses that carry a higher benefit ratio, combined with a reduction in individual Medicare Advantage membership, as well as incremental investments to improve member and patient outcomes and support operational excellence. These factors were partially offset by individual Medicare Advantage pricing inclusive of plan exits and benefit design changes that more than offset claims trend and the funding environment, as well as higher favorable prior-period medical claims development in the 2025 quarter and period. Further, the quarter comparison was negatively impacted in the 2025 quarter as a result of the change in Medicare Part D seasonality due to the IRA and the period comparison was affected by the favorable workday impact in the 2025 period combined with the favorability associated with the change in Medicare Part D seasonality due to the IRA.   

Consolidated benefits expense included $275 million of favorable prior-period medical claims reserve development in the 2025 quarter and $24 million of favorable prior-period medical claims development in the 2024 quarter. Consolidated benefits expense included $913 million of favorable prior-period medical claims reserve development in the 2025 period and $693 million of favorable prior-period medical claims reserve development in the 2024 period. Prior-period medical claims reserve development decreased the consolidated benefit ratio by approximately 90 basis points in the 2025 quarter and decreased the consolidated benefit ratio by approximately 10 basis points in the 2024 quarter. Prior-period medical claims reserve development decreased the consolidated benefit ratio by approximately 100 basis points in the 2025 period and decreased the consolidated benefit ratio by approximately 80 basis points in the 2024 period.

Operating Costs

Our segments incur both direct and shared indirect operating costs. We allocate the indirect costs shared by the segments primarily as a function of revenues. As a result, the profitability of each segment is interdependent.

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Consolidated operating costs increased $0.7 billion, or 22.