Company: HUM
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0000049071-25-000057
Chunk: 24

Company: HUMANA INC
Filing Date: 2025-11-05
Form: 10-Q
Item: Item 2
Chunk 24
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 from operations

CenterWell income from operations decreased $77 million, or 20.2%, from $382 million in the 2024 quarter to $305 million in the 2025 quarter and increased $39 million, or 3.9%, from $1,002 million in the 2024 period to $1,041 million in the 2025 period primarily due to the same factors impacting the CenterWell segment's revenue and operating cost ratio as more fully described below. 

Services Revenue

CenterWell external services revenue increased $0.5 billion, or 52.0%, from $0.9 billion in the 2024 quarter to $1.3 billion in the 2025 quarter and increased $1.1 billion, or 41.5%, from $2.6 billion in the 2024 period to $3.6 billion in the 2025 period primarily due to higher revenues associated with growth in the primary care and pharmacy solutions businesses, partially offset by the impact of the v28 risk model revision impacting the Primary Care business. 

Intersegment Revenue

CenterWell intersegment revenues increased $0.4 billion, or 9.2%, from $4.2 billion in the 2024 quarter to $4.5 billion in the 2025 quarter and increased $0.6 billion, or 5.3%, from $12.3 billion in the 2024 period to $12.9 billion in the 2025 period primarily due to higher revenues associated with growth in the pharmacy solutions business.

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Operating Costs

The CenterWell segment operating cost ratio increased 260 basis points from 91.3% for the 2024 quarter to 93.9% for the 2025 quarter and increased 60 basis points from 92.1% for the 2024 period to 92.7% for the 2025 period primarily resulting from the continued phase-in of the v28 risk model revision within the primary care business, as well as the uptick of volume within CenterWell Specialty Pharmacy, which carries a higher operating cost ratio than the traditional pharmacy business. These factors were partially offset by more favorable operating trends in the primary care business as a result of maturation of the v28 mitigation activities, as well as administrative cost efficiencies resulting from the value creation initiatives. 

Liquidity

Historically, our primary sources of cash have included receipts of premiums, services revenue, and investment and other income, as well as proceeds from the sale or maturity