Company: HUM
Filing Date: 2025-07-30
Form Type: 10-Q
Source: 0000049071-25-000042
Chunk: 22

Company: HUMANA INC
Filing Date: 2025-07-30
Form: 10-Q
Item: Item 2
Chunk 22
---
 by an increased direct subsidy due to the IRA, and higher per member state-based contracts premiums, as well as membership growth in the state-based contracts and stand-alone PDP businesses. These factors were partially offset by the membership decline within the individual Medicare Advantage business, inclusive of the decision to exit certain unprofitable plans and counties. 

Services Revenue

Insurance segment services revenue decreased $8 million, or 3.7%, from $214 million in the 2024 quarter to $206 million in the 2025 quarter and decreased $31 million, or 6.3%, from $489 million in the 2024 period to $458 million in the 2025 period.

Benefits Expense

The Insurance segment benefit ratio increased 40 basis points from 89.5% for the 2024 quarter to 89.9% for the 2025 quarter 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 the change in Medicare Part D seasonality due to the IRA. The Insurance segment benefit ratio decreased 70 basis points from 89.4% for the 2024 period to 88.7% for the 2025 period primarily due to the net favorable impact of the factors impacting the quarter comparison, as well as the favorable workday impact in the first quarter of 2025, partially offset by lower favorable prior-period medical claims reserve development in the 2025 period.

42

Operating Costs

The Insurance segment operating cost ratio decreased 10 basis points from 8.4% for the 2024 quarter to 8.3% for the 2025 quarter and decreased 10 basis points from 8.4% for the 2024 period to 8.3% for the 2025 period primarily due to administrative cost efficiencies resulting from the value creation initiatives and operating leverage associated with increased revenues from the impact of the IRA as previously described. These factors were partially offset by the operating leverage impact of the loss of individual Medicare Advantage membership.

CenterWell Segment

ChangeThree months ended June 30,Six months ended June 30,Three months ended June 30, 2025 vs 2024Six months