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Humana to Release Detailed First Quarter 2017 Results May 3, 2017; Announces Financial Reporting Segments Realignment

Category:

Monday, April 17, 2017 3:15 pm EDT

Dateline:

LOUISVILLE, Ky.

Public Company Information:

NYSE:
HUM

LOUISVILLE, Ky.--(BUSINESS WIRE)--Humana Inc. (NYSE: HUM) announced today that it will release its detailed first quarter 2017 (1Q 2017) financial results on Wednesday, May 3, 2017 at 6:30 a.m. eastern time. The company will host a conference call and webcast at 9:00 a.m. eastern time that morning to discuss its financial results for the quarter and its 2017 earnings guidance. The company plans to pre-release earnings per diluted common share for 1Q17 as well as discuss certain components of its earnings guidance for 2017 in conjunction with its Investor Day scheduled for April 25, 2017. Logistical details associated with Humana’s 1Q 2017 earnings call are included below.

The company also announced today that it has realigned certain of its businesses for its financial reporting segments to correspond with internal management reporting changes and the company’s previously announced planned exit from the individual commercial medical business (Individual Commercial) on January 1, 2018. Additionally, the company renamed its Group segment the Group and Specialty segment. The company’s segments now include Retail, Group and Specialty, Healthcare Services, and Individual Commercial.

The more significant realignment included presenting the Individual Commercial business results as a separate segment. These results were previously included in the Retail segment results. Specialty health insurance benefits, including dental, vision, other supplement health, and financial protection products, marketed to both individuals and employer groups will now be included in the Group and Specialty segment. Specialty health insurance benefits marketed to individuals were previously included in the Retail segment results. Additionally, the company’s Go365 wellness business (previously known as HumanaVitality) is now included in the company’s Healthcare Services segment versus its previous inclusion in the Group and Specialty segment.

Recast historical segment financials for the 2016 quarters and full year, as well as the corresponding recast segment membership totals, are included with this press release. Descriptions of the company’s segments have been updated to reflect these changes and are noted below.

  • Retail segment – This segment consists of Medicare benefits, marketed to individuals directly or via group Medicare accounts, as well as state-based contracts. State-based contracts include those with various states to provide Medicaid, dual eligible, and Long-Term Support Services benefits. In addition, this segment also includes the company’s contract with the Centers for Medicare and Medicaid Services to administer the Limited Income Newly Eligible Transition prescription drug plan program.
  • Group and Specialty segment – This segment consists of employer group fully-insured commercial medical products, and specialty health insurance benefits marketed to individuals and groups, including dental, vision, and other supplemental health and voluntary insurance benefits. In addition, the segment also includes the company’s administrative services only products and its military services businesses, primarily the TRICARE South Region contract.
  • Healthcare Services segment – This segment includes services offered to the company’s health plan members as well as to third parties, including pharmacy solutions, provider services, and clinical programs, such as home health and other services and capabilities to promote wellness and advance population health.
  • Individual Commercial segment – This segment consists of Individual Commercial products marketed under the HumanaOne brand. For 2017, the company offers on-exchange products, as well as certain grandfathered policies issued prior to the enactment of the Health Care Reform Law. Off-exchange products were also offered in 2016.

1Q 2017 Earnings Call Details

All parties interested in the audio only portion of the company’s 1Q 2017 earnings conference call are invited to dial 888-625-7430. No password is required. The webcast of the 1Q 2017 earnings call may be accessed via Humana’s Investor Relations page at humana.com. The company suggests participants for both the conference call and those listening via the web dial in or sign on at least 15 minutes in advance of the call.

For those unable to participate in the live event, the archive will be available in the Historical Webcasts and Presentations section of the Investor Relations page at humana.com, approximately two hours following the live webcast. Telephone replays will also be available approximately two hours following the live event until midnight eastern time on July 3, 2017 and can be accessed by dialing 855-859-2056 and providing the conference ID #89800684.

The company’s 1Q 2017 earnings news release is expected to include financial measures that are not in accordance with Generally Accepted Accounting Principles (GAAP). A reconciliation of non-GAAP financial measures to financial results under GAAP, as well as management’s reasons for including non-GAAP financial measures, will be included in the company’s 1Q 2017 earnings news release, a copy of which will be available on the Investor Relations page of humana.com on May 3, 2017.

About Humana

Humana Inc., headquartered in Louisville, Ky., is a leading health and well-being company focused on making it easy for people to achieve their best health with clinical excellence through coordinated care. The company’s strategy integrates care delivery, the member experience, and clinical and consumer insights to encourage engagement, behavior change, proactive clinical outreach and wellness for the millions of people we serve across the country.

More information regarding Humana is available to investors via the Investor Relations page of the company’s web site at humana.com, including copies of:

  • Annual reports to stockholders
  • Securities and Exchange Commission filings
  • Most recent investor conference presentations
  • Quarterly earnings news releases
  • Calendar of events
  • Corporate Governance information
 

Humana Inc.

Segment Realignment Supplementary Information

 

Contents

 

Page

Description

6 1Q16 Segment Financial Information (Recast)
7 2Q16 Segment Financial Information (Recast)
8 3Q16 Segment Financial Information (Recast)
9 4Q16 Segment Financial Information (Recast)
10 FY 2016 Segment Financial Information (Recast)
11 2016 Membership Detail by Quarter (Recast)
                           

Humana Inc.

Q1 2016 Segment Financial Information (Recast)
in millions
 
 
Group and Healthcare Individual Other Eliminations/

 

Retail

Specialty Services Commercial Businesses Corporate Consolidated
 
Q1 2016

 

Revenues - external customers
Premiums:
Individual Medicare Advantage $ 8,027 $ - $ - $ - $ - $ - $ 8,027
Group Medicare Advantage 1,077 - - - - - 1,077
Medicare stand-alone PDP   1,039     -     -     -     -     -     1,039  
Total Medicare   10,143     -     -     -     -     -     10,143  
Fully-insured 104 1,337 - 893 - - 2,334
Specialty - 318 - - - - 318
Medicaid and other   630     5     -     -     10     -     645  
Total premiums   10,877     1,660     -     893     10     -     13,440  
Services revenue:
Provider - - 71 - - - 71
ASO and other 1 177 1 - 3 - 182
Pharmacy   -     -     7     -     -     -     7  
Total services revenue   1     177     79     -     3     -     260  
Total revenues - external customers 10,878     1,837     79     893     13     -     13,700  
Intersegment revenues
Services - 6 4,784 - - (4,790 ) -
Products   -     -     1,360     -     -     (1,360 )   -  
Total intersegment revenues -     6     6,144     -     -     (6,150 )   -  
Investment income   24     6     7     2     15     46     100  
Total revenues   10,902     1,849     6,230     895     28     (6,104 )   13,800  
Operating expenses:
Benefits 9,633 1,222 - 729 25 (212 ) 11,397
Operating costs 1,082 434 5,942 169 4 (5,863 ) 1,768
Depreciation and amortization   46     21     36     9     -     (24 )   88  
Total operating expenses   10,761     1,677     5,978     907     29     (6,099 )   13,253  
Income (loss) from operations 141 172 252 (12 ) (1 ) (5 ) 547
Interest expense   -     -     -     -     -     47     47  
Income (loss) before income taxes $ 141   $ 172   $ 252   $ (12 ) $ (1 ) $ (52 ) $ 500  
 
Benefit ratio 88.6 % 73.6 % 81.6 % 84.8 %
Operating cost ratio 9.9 % 23.5 % 95.5 % 18.9 % 12.9 %
                           
Humana Inc.
Q2 2016 Segment Financial Information (Recast)
in millions
 
 
Group and Healthcare Individual Other Eliminations/
Retail Specialty Services Commercial Businesses Corporate Consolidated
 
Q2 2016
Revenues - external customers
Premiums:
Individual Medicare Advantage $ 8,050 $ - $ - $ - $ - $ - $ 8,050
Group Medicare Advantage 1,085 - - - - - 1,085
Medicare stand-alone PDP   1,015     -     -     -     -     -     1,015  
Total Medicare   10,150     -     -     -     -     -     10,150  
Fully-insured 106 1,357 - 1,024 - - 2,487
Specialty - 321 - - - - 321
Medicaid and other   678     5     -     -     9     -     692  
Total premiums   10,934     1,683     -     1,024     9     -     13,650  
Services revenue:
Provider - - 74 - - - 74
ASO and other 2 176 - - 3 - 181
Pharmacy   -     -     7     -     -     -     7  
Total services revenue   2     176     81     -     3     -     262  
Total revenues - external customers 10,936     1,859     81     1,024     12     -     13,912  
Intersegment revenues
Services - 6 4,767 - - (4,773 ) -
Products   -     -     1,433     -     -     (1,433 )   -  
Total intersegment revenues   -     6     6,200     -     -     (6,206 )   -  
Investment income   22     6     7     1     16     43     95  
Total revenues   10,958     1,871     6,288     1,025     28     (6,163 )   14,007  
Operating expenses:
Benefits 9,327 1,302 - 1,089 31 (240 ) 11,509
Operating costs 1,069 423 5,974 152 4 (5,896 ) 1,726
Depreciation and amortization   48     22     35     9     -     (25 )   89  
Total operating expenses   10,444     1,747     6,009     1,250     35     (6,161 )   13,324  
Income (loss) from operations 514 124 279 (225 ) (7 ) (2 ) 683
Interest expense   -     -     -     -     -     47     47  
Income (loss) before income taxes $ 514   $ 124   $ 279   $ (225 ) $ (7 ) $ (49 ) $ 636  
 
Benefit ratio 85.3 % 77.4 % 106.3 % 84.3 %
Operating cost ratio 9.8 % 22.7 % 95.1 % 14.8 % 12.4 %
                           
Humana Inc.
Q3 2016 Segment Financial Information (Recast)
in millions
 
 
Group and Healthcare Individual Other Eliminations/
Retail Specialty Services Commercial Businesses Corporate Consolidated
 
Q3 2016
Revenues - external customers
Premiums:
Individual Medicare Advantage $ 7,977 $ - $ - $ - $ - $ - $ 7,977
Group Medicare Advantage 1,067 - - - - - 1,067
Medicare stand-alone PDP   1,004     -     -     -     -     -     1,004  
Total Medicare   10,048     -     -     -     -     -     10,048  
Fully-insured 109 1,350 - 882 - - 2,341
Specialty - 318 - - - - 318
Medicaid and other   652     2     -     -     10     -     664  
Total premiums   10,809     1,670     -     882     10     -     13,371  
Services revenue:
Provider - - 69 - - - 69
ASO and other 2 147 - - 1 - 150
Pharmacy   -     -     8     -     -     -     8  
Total services revenue   2     147     77     -     1     -     227  
Total revenues - external customers 10,811     1,817     77     882     11     -     13,598  
Intersegment revenues
Services - 5 4,741 - - (4,746 ) -
Products   -     -     1,580     -     -     (1,580 )   -  
Total intersegment revenues   -     5     6,321     -     -     (6,326 )   -  
Investment income   22     7     8     -     17     42     96  
Total revenues   10,833     1,829     6,406     882     28     (6,284 )   13,694  
Operating expenses:
Benefits 9,031 1,352 - 727 26 (236 ) 10,900
Operating costs 1,143 421 6,073 144 4 (6,026 ) 1,759
Depreciation and amortization   51     19     36     9     -     (29 )   86  
Total operating expenses   10,225     1,792     6,109     880     30     (6,291 )   12,745  
Income (loss) from operations 608 37 297 2 (2 ) 7 949
Interest expense   -     -     -     -     -     47     47  
Income (loss) before income taxes $ 608   $ 37   $ 297   $ 2   $ (2 ) $ (40 ) $ 902  
 
Benefit ratio 83.6 % 81.0 % 82.4 % 81.5 %
Operating cost ratio 10.6 % 23.1 % 94.9 % 16.3 % 12.9 %
                           
Humana Inc.
Q4 2016 Segment Financial Information (Recast)
in millions
 
 
Group and Healthcare Individual Other Eliminations/
Retail Specialty Services Commercial Businesses Corporate Consolidated
 
Q4 2016
Revenues - external customers
Premiums:
Individual Medicare Advantage $ 7,809 $ - $ - $ - $ - $ - $ 7,809
Group Medicare Advantage 1,054 - - - - - 1,054
Medicare stand-alone PDP   951   -   -   -   -   -   951
Total Medicare   9,814   -   -   -   -   -   9,814
Fully-insured 109 1,361 - 265 - - 1,735
Specialty - 322 - - - - 322
Medicaid and other   680   -   -   -   9   -   689
Total premiums   10,603   1,683   -   265   9   -   12,560
Services revenue:
Provider - - 64 - - - 64
ASO and other 1 143 - - 3 - 147
Pharmacy   -   -   9   -   -   -   9
Total services revenue   1   143   73   -   3   -   220
Total revenues - external customers   10,604   1,826   73   265   12   -   12,780
Intersegment revenues
Services - 5 4,687 - - (4,692) -
Products   -   -   1,620   -   -   (1,620)   -
Total intersegment revenues   -   5   6,307   -   -   (6,312)   -
Investment income   22   6   8   2   18   42   98
Total revenues   10,626   1,837   6,388   267   30   (6,270)   12,878
Operating expenses:
Benefits 8,792 1,357 - 756 535 (239) 11,201
Operating costs 1,356 449 6,084 136 4 (6,005) 2,024
Depreciation and amortization   51   20   36   9   1   (26)   91
Total operating expenses   10,199   1,826   6,120   901   540   (6,270)   13,316
Income (loss) from operations 427 11 268 (634) (510) - (438)
Interest expense   -   -   -   -   -   48   48
Income (loss) before income taxes $ 427 $ 11 $ 268 $ (634) $ (510) $ (48) $ (486)
 
Benefit ratio 82.9% 80.6% 285.3% 89.2%
Operating cost ratio 12.8% 24.5% 95.4% 51.3% 15.8%
                           
Humana Inc.
FY 2016 Segment Financial Information (Recast)
in millions
 
 
Group and Healthcare Individual Other Eliminations/
Retail Specialty Services Commercial Businesses Corporate Consolidated
(in millions)
Full Year 2016
Revenues - external customers
Premiums:
Individual Medicare Advantage $ 31,863 $ - $ - $ - $ - $ - $ 31,863
Group Medicare Advantage 4,283 - - - - - 4,283
Medicare stand-alone PDP   4,009     -     -     -     -     -     4,009

Total Medicare

  40,155     -     -     -     -     -     40,155
Fully-insured 428 5,405 - 3,064 - - 8,897
Specialty - 1,279 - - - - 1,279
Medicaid and other   2,640     12     -     -     38     -     2,690
Total premiums   43,223     6,696     -     3,064     38     -     53,021
Services revenue:
Provider - - 278 - - - 278
ASO and other 6 643 1 - 10 - 660
Pharmacy   -     -     31     -     -     -     31
Total services revenue   6     643     310     -     10     -     969
Total revenues - external customers   43,229     7,339     310     3,064     48     -     53,990
Intersegment revenues
Services - 22 18,979 - - (19,001) -
Products   -     -     5,993     -     -     (5,993)     -
Total intersegment revenues   -     22     24,972     -     -     (24,994)     -
Investment income   90     25     30     5     66     173     389
Total revenues   43,319     7,386     25,312     3,069     114     (24,821)     54,379
Operating expenses:
Benefits 36,783 5,233 - 3,301 617 (927) 45,007
Operating costs 4,650 1,727 24,073 601 16 (23,790) 7,277
Depreciation and amortization   196     82     143     36     1     (104)     354
Total operating expenses   41,629     7,042     24,216     3,938     634     (24,821)     52,638
Income (loss) from operations 1,690 344 1,096 (869) (520) - 1,741
Interest expense   -     -     -     -     -     189     189
Income (loss) before income taxes $ 1,690   $ 344   $ 1,096   $ (869)   $ (520)   $ (189)   $ 1,552
 
Benefit ratio 85.1% 78.2% 107.7% 84.9%
Operating cost ratio 10.8% 23.5% 95.2% 19.6% 13.5%
               
Humana Inc.
Ending Membership Detail (Recast)
In thousands
   
March 31, 2016     June 30, 2016     September 30, 2016     December 31, 2016

Medical Membership:

Retail
Individual Medicare Advantage 2,807.2 2,816.5 2,831.7 2,837.6
Group Medicare Advantage 349.2 351.7 353.9 355.4
Medicare stand-alone PDPs 4,834.1     4,856.3     4,913.4     4,951.4
Total Medicare 7,990.5     8,024.5     8,099.0     8,144.4
State-based Medicaid 388.4 391.6 390.1 388.1
Medicare Supplement 209.8     212.3     217.1     218.8
Total Retail 8,588.7     8,628.4     8,706.2     8,751.3
 
Group and Specialty
Fully-insured medical commercial 1,136.4 1,140.1 1,131.5 1,136.0
ASO commercial 579.4 578.4 570.3 573.2
Military services 3,076.8     3,074.8     3,080.9     3,084.1
Total Group and Specialty 4,792.6     4,793.3     4,782.7     4,793.3
 
Individual commercial 875.7 792.0 726.2 654.8
 
Other Businesses
Long-term care and other 32.2     31.4     31.0     30.8
Total Other Businesses 32.2     31.4     31.0     30.8
 
Total Medical Membership 14,289.2     14,245.1     14,246.1     14,230.2
 
 

Specialty Membership:

Group and Specialty
Dental - fully-insured 2,981.4 2,969.6 2,955.4 2,952.4
Dental - ASO 703.6 702.4 706.6 702.0
Vision 2,129.7 2,134.2 2,125.8 2,136.0
Other supplemental benefits 1,230.4     1,196.1     1,167.4     1,170.8
Total Group and Specialty 7,045.1     7,002.3     6,955.2     6,961.2

Contact:

Humana Inc.
Investor Relations:
Regina Nethery, 502-580-3644
Rnethery@humana.com
or
Corporate Communications:
Tom Noland, 502-580-3674
Tnoland@humana.com