•Reports 2Q23 earnings per share (EPS) of $7.66 on a GAAP basis, Adjusted EPS of $8.94; reports YTD 2023 EPS of $17.54 on a GAAP basis, $18.32 on an Adjusted basis

•Revises FY 2023 EPS guidance to 'at least $26.91' on a GAAP basis, affirms FY 2023 Adjusted EPS of 'at least $28.25'

•Raises 2023 individual Medicare Advantage membership growth by 50,000 to 'approximately 825,000', or 18 percent growth over FY 2022 ending membership, meaningfully higher than industry growth

•Highlights stabilizing Medicare Advantage utilization environment based on most recent claims activity; affirms FY 2023 Insurance segment benefit expense ratio guidance range of 86.3% to 87.3%

Please refer to the tables above, as well as the consolidated and segment highlight sections in the detailed earnings release for additional discussion of the factors impacting the year-over-comparisons.

Humana’s full earnings press release, including the statistical pages, has been posted to the company’s Investor Relations site and may be accessed at https://humana.gcs-web.com/ or via a current report on Form 8-K filed by the company with the Securities and Exchange Commission this morning (available at www.sec.gov or on the company’s website).

(a) 2Q23 Adjusted results exclude the following:

•Amortization expense for identifiable intangibles - GAAP measures affected in this release include consolidated pretax results, EPS, and Insurance and CenterWell segments income from operations (including amortization expense of $6 million in the Insurance segment and $10 million in the CenterWell segment).

•Put/call valuation adjustments associated with Humana’s non-consolidating minority interest investments - GAAP measures affected include consolidated pretax results and EPS.

•Transaction and integration costs - GAAP measures affected include consolidated pretax results, EPS, and the consolidated operating cost ratio.

•Impact of exit of employer group commercial medical products business - GAAP measures affected include consolidated pretax results, EPS, consolidated revenues, consolidated benefit expense ratio, consolidated operating cost ratio, Insurance segment revenues, Insurance segment benefit expense ratio, Insurance segment operating cost ratio, and Insurance segment income from operations.

•Accrual related to certain anticipated litigation expenses - GAAP measures affected in this release include consolidated pretax results, EPS, Insurance segment income from operations, and the consolidated and Insurance segment operating cost ratios.

•Cumulative net tax benefit of adjustments - EPS is the only GAAP measure affected.

Revenues - CONSOLIDATED (in millions)			2Q23 (a)			2Q22 (b)			YTD 2023 (c)			YTD 2022 (d)
GAAP			$26,747			$23,662			$53,489			$47,632
Change in fair market value of publicly-traded equity securities			—			62			(1)			170
Impact of exit of employer group commercial medical products business			(1,014)			(1,184)			(2,103)			(2,400)
Adjusted (non-GAAP)			$25,733			$22,540			$51,385			$45,402

Revenues - INSURANCE SEGMENT (in millions)			2Q23 (a)			2Q22 (b)			YTD 2023 (c)			YTD 2022 (d)
GAAP			$25,875			$22,532			$51,778			$45,499
Impact of exit of employer group commercial medical products business			(1,014)			(1,184)			(2,103)			(2,400)
Adjusted (non-GAAP)			$24,861			$21,348			$49,675			$43,099

(b) 2Q22 Adjusted results exclude the following:

•Amortization expense for identifiable intangibles - GAAP measures affected in this release include consolidated pretax results, EPS, and Insurance and CenterWell segments income from operations (including amortization expense of $5 million in the Insurance segment and $13 million in the CenterWell segment).

•Put/call valuation adjustments associated with Humana’s non-consolidating minority interest investments - GAAP measures affected include consolidated pretax results and EPS.

•Transaction and integration costs - GAAP measures affected include consolidated pretax results, EPS, and the consolidated operating cost ratio.

•Change in fair market value of publicly-traded equity securities - GAAP measures affected include consolidated pretax results, EPS, and consolidated revenues.

•Impact of exit of employer group commercial medical products business - GAAP measures affected include consolidated pretax results, EPS, consolidated revenues, consolidated benefit expense ratio, consolidated operating cost ratio, Insurance segment revenues, Insurance segment benefit expense ratio, Insurance segment operating cost ratio, and Insurance segment income from operations.

•Charges primarily related to asset and software impairment and abandonment, as a result of initiatives undertaken associated with the company's previously disclosed $1 billion value creation - GAAP measures affected in this release include consolidated pretax, EPS, and the consolidated operating cost ratio.

•Impact related to the recognition of a deferred tax liability in connection with the held-for-sale classification of Kindred at Home's (KAH) Hospice and Personal Care divisions resulting from the company's then pending sale of the business - EPS is the only GAAP measure affected in this release.

•Cumulative net tax benefit of adjustments (excluding the impact of the tax impact related to KAH note in above bullet point) - EPS is the only GAAP measure affected.

(c) YTD 2023 Adjusted results exclude the following:

•Amortization expense for identifiable intangibles - GAAP measures affected in this release include consolidated pretax results, EPS, and Insurance and CenterWell segments income from operations (including amortization expense of $11 million in the Insurance segment and $23 million in the CenterWell segment).

•Put/call valuation adjustments associated with Humana’s non-consolidating minority interest investments - GAAP measures affected include consolidated pretax results and EPS.

•Transaction and integration costs - GAAP measures affected include consolidated pretax results, EPS, and the consolidated operating cost ratio.

•Change in fair market value of publicly-traded equity securities - GAAP measures affected include consolidated pretax results, EPS, and consolidated revenues.

•Impact of exit of employer group commercial medical products business - GAAP measures affected include consolidated pretax results, EPS, consolidated revenues, consolidated benefit expense ratio, consolidated operating cost ratio, Insurance segment revenues, Insurance segment benefit expense ratio, Insurance segment operating cost ratio, and Insurance segment income from operations.

•Accrual related to certain anticipated litigation expenses - GAAP measures affected in this release include consolidated pretax results, EPS, Insurance segment income from operations, and the consolidated and Insurance segment operating cost ratios.

•Cumulative net tax benefit of adjustments - EPS is the only GAAP measure affected.

(d) YTD 2022 Adjusted results exclude the following:

•Amortization expense for identifiable intangibles - GAAP measures affected in this release include consolidated pretax results, EPS, and Insurance and CenterWell segments income from operations (including amortization expense of $10 million in the Insurance segment and $26 million in the CenterWell segment).

•Put/call valuation adjustments associated with Humana’s non-consolidating minority interest investments - GAAP measures affected include consolidated pretax results and EPS.

•Transaction and integration costs - GAAP measures affected include consolidated pretax results, EPS, and the consolidated operating cost ratio.

•Change in fair market value of publicly-traded equity securities - GAAP measures affected include consolidated pretax results, EPS, and consolidated revenues.

•Charges primarily related to asset and software impairment and abandonment, as a result of initiatives undertaken associated with the company's previously disclosed $1 billion value creation - GAAP measures affected in this release include consolidated pretax, EPS, and the consolidated operating cost ratio.

•Impact related to the recognition of a deferred tax liability in connection with the held-for-sale classification of Kindred at Home's Hospice and Personal Care divisions resulting from the company's then pending sale of the business - EPS is the only GAAP measure affected in this release.

•Cumulative net tax benefit of adjustments (excluding the impact of the tax impact related to KAH note in above bullet point) - EPS is the only GAAP measure affected.

(g) FY 2023 projected Adjusted results exclude the following:

•FY 2023 GAAP EPS excludes the YTD 2023 impact of fair value changes of the put/call options associated with Humana's non-consolidating minority interest investments as future value changes can not be estimated.

•The fair value of publicly-traded securities, their impact on GAAP EPS, and the related non-GAAP adjustment will fluctuate depending on the public trading value of the stock. The guidance set forth herein assumes no further change in the fair value of those investments, other than the YTD 2023 adjustment.

•Transaction and integration costs reflect the impact of YTD 2023 activity.

•If Humana does not design and price its products properly and competitively, if the premiums Humana receives are insufficient to cover the cost of healthcare services delivered to its members, if the company is unable to implement clinical initiatives to provide a better healthcare experience for its members, lower costs and appropriately document the risk profile of its members, or if its estimates of benefits expense are inadequate, Humana’s profitability could be materially adversely affected. Humana estimates the costs of its benefit expense payments, and designs and prices its products accordingly, using actuarial methods and assumptions based upon, among other relevant factors, claim payment patterns, medical cost inflation, and historical developments such as claim inventory levels and claim receipt patterns. The company continually reviews estimates of future payments relating to benefit expenses for services incurred in the current and prior periods and makes necessary adjustments to its reserves, including premium deficiency reserves, where appropriate. These estimates involve extensive judgment, and have considerable inherent variability because they are extremely sensitive to changes in claim payment patterns and medical cost trends. Accordingly, Humana's reserves may be insufficient.

•If Humana fails to effectively implement its operational and strategic initiatives, including its Medicare initiatives, which are of particular importance given the concentration of the company's revenues in these products, state-based contract strategy, the growth of its CenterWell business, and its integrated care delivery model, the company’s business may be materially adversely affected. In addition, there can be no assurances that the company will be successful in maintaining or improving its Star ratings in future years.

•If Humana fails to properly maintain the integrity of its data, to strategically maintain existing or implement new information systems, to protect Humana’s proprietary rights to its systems, or to defend against cyber-security attacks or prevent other privacy or data security incidents that result in security breaches that disrupt the company's operations or in the unintentional dissemination of sensitive personal information or proprietary or confidential information, the company’s business may be materially adversely affected.

•Humana is involved in various legal actions, or disputes that could lead to legal actions (such as, among other things, provider contract disputes and qui tam litigation brought by individuals on behalf of the government), governmental and internal investigations, and routine internal review of business processes any of which, if resolved unfavorably to the company, could result in substantial monetary damages or changes in its business practices. Increased litigation and negative publicity could also increase the company’s cost of doing business.

•As a government contractor, Humana is exposed to risks that may materially adversely affect its business or its willingness or ability to participate in government healthcare programs including, among other things, loss of material government contracts; governmental audits and investigations; potential inadequacy of government determined payment rates; potential restrictions on profitability, including by comparison of profitability of the company’s Medicare Advantage business to non-Medicare Advantage business; or other changes in the governmental programs in which Humana participates. Changes to the risk-adjustment model utilized by CMS to adjust premiums paid to Medicare Advantage plans or retrospective recovery by CMS of previously paid premiums as a result of the final rule related to the risk adjustment data validation audit methodology published by CMS on January 30, 2023 (Final RADV Rule), which Humana believes fails to address adequately the statutory requirement of actuarial equivalence due to its failure to include a "Fee for Service Adjuster (FFS Adjuster)" could have a material adverse effect on the company's operating results, financial position and cash flows.

•Humana's business activities are subject to substantial government regulation. New laws or regulations, or legislative, judicial, or regulatory changes in existing laws or regulations or their manner of application could increase the company's cost of doing business and have a material adverse effect on Humana’s results of operations (including restricting revenue, enrollment and premium growth in certain products and market segments, restricting the company’s ability to expand into new markets, increasing the company’s medical and operating costs by, among other things, requiring a minimum benefit ratio on insured products, lowering the company’s Medicare payment rates and increasing the company’s expenses associated with a non-deductible health insurance industry fee and other assessments); the company’s financial position (including the company’s ability to maintain the value of its goodwill); and the company’s cash flows.

•Humana’s failure to manage acquisitions, divestitures and other significant transactions successfully may have a material adverse effect on the company’s results of operations, financial position, and cash flows.

•If Humana fails to develop and maintain satisfactory relationships with the providers of care to its members, the company’s business may be adversely affected.

•Humana faces significant competition in attracting and retaining talented employees. Further, managing succession for, and retention of, key executives is critical to the Company’s success, and its failure to do so could adversely affect the Company’s businesses, operating results and/or future performance.

•Humana’s pharmacy business is highly competitive and subjects it to regulations and supply chain risks in addition to those the company faces with its core health benefits businesses.

•Changes in the prescription drug industry pricing benchmarks may adversely affect Humana’s financial performance.

•Humana’s ability to obtain funds from certain of its licensed subsidiaries is restricted by state insurance regulations.

•Downgrades in Humana’s debt ratings, should they occur, may adversely affect its business, results of operations, and financial condition.

•The securities and credit markets may experience volatility and disruption, which may adversely affect Humana’s business.

•The spread of, and response to, the novel coronavirus, or COVID-19, underscores certain risks Humana faces, including those discussed above, and the ongoing, heightened uncertainty created by the pandemic precludes any prediction as to the ultimate adverse impact to Humana of COVID-19.

•Form 10-K for the year ended December 31, 2022;

•Form 10-Q for the quarter ended March 31, 2023; and

•Form 8-Ks filed during 2023.

Humana Inc. is committed to putting health first – for our teammates, our customers, and our company. Through our Humana insurance services, and our CenterWell health care services, we make it easier for the millions of people we serve to achieve their best health – delivering the care and service they need, when they need it. These efforts are leading to a better quality of life for people with Medicare, Medicaid, families, individuals, military service personnel, and communities at large. Learn more about what we offer at Humana.com and at CenterWell.com.

•Reports 2Q23 earnings per share (EPS) of $7.66 on a GAAP basis, Adjusted EPS of $8.94; reports YTD 2023 EPS of $17.54 on a GAAP basis, $18.32 on an Adjusted basis

•Revises FY 2023 EPS guidance to 'at least $26.91' on a GAAP basis, affirms FY 2023 Adjusted EPS of 'at least $28.25'

•Raises 2023 individual Medicare Advantage membership growth by 50,000 to 'approximately 825,000', or 18 percent growth over FY 2022 ending membership, meaningfully higher than industry growth

•Highlights stabilizing Medicare Advantage utilization environment based on most recent claims activity; affirms FY 2023 Insurance segment benefit expense ratio guidance range of 86.3% to 87.3%

Please refer to the tables above, as well as the consolidated and segment highlight sections that follow for additional discussion of the factors impacting the year-over-year comparisons.

Additional FY 2023 guidance points are included on page 19 of this earnings release.

The favorable year-over-year quarter and YTD GAAP consolidated revenues comparisons were primarily driven by the following factors:

•individual Medicare Advantage and state-based contracts membership growth; and

•higher per member individual Medicare Advantage premiums.

•the phase-out of COVID-19 sequestration relief in 2022,

•the anticipated decline in year-over-year membership associated with the company's group commercial medical, group Medicare Advantage and stand-alone PDP products, and

•the impact of the divestiture of the company's 60 percent ownership of Gentiva (formerly Kindred) Hospice that was completed in August 2022.

The year-over-year quarterly increase in the GAAP ratio reflects the following factors:

•investments in the benefit design of the company's products for 2023,

•higher Medicare Advantage utilization trends in 2Q23 as previously discussed, and

•the impact of continued strong individual Medicare Advantage growth following the Annual Election Period (AEP), including a higher-than-expected proportion of age-ins, which typically have a higher benefits expense ratio initially than the average new member.

•increased individual Medicare Advantage premium yield,

•higher favorable prior period medical claims reserve development (Prior Period Development) in 2Q23, and

•lower COVID-19 inpatient utilization in 2Q23, and corresponding decrease in average unit cost given the additional 20 percent payment on these admissions during the Public Health Emergency (PHE).    

The year-over-year YTD decrease in the GAAP ratio reflects the following factors:

•increased individual Medicare Advantage premium yield,

•lower COVID-19 inpatient utilization in YTD 2023, and corresponding decrease in average unit cost given the additional 20 percent payment on these admissions during the PHE, and

•higher favorable Prior Period Development in YTD 2023.

Furthermore, the 2Q23 and YTD 2023 ratios continue to reflect a shift in line of business mix, with growth in individual Medicare Advantage and state-based contracts and other membership, which can carry a higher benefits expense ratio.

The quarter and YTD decreases in the GAAP consolidated operating cost ratio from the respective periods in 2022 primarily related to the following:

•the divestiture of the company's 60 percent ownership of Gentiva (formerly Kindred) Hospice in August 2022; the business had a significantly higher operating cost ratio than the company's historical consolidated operating cost ratio,

•scale efficiencies associated with growth in the company's individual Medicare Advantage membership, and

•the impact of initiatives related to the previously-disclosed value creation plan, including $203 million of charges in 2Q22 and YTD 2022 primarily related to asset and software impairment and abandonment. The impact of the impairment and abandonment charges was not allocated to the segments.

•an increase in commissions for brokers related to the significant individual Medicare Advantage membership growth in 2023,

•the favorable impact to revenues in 2022 as a result of sequestration relief, and

•accrual related to certain anticipated litigation expenses in 2Q23.

•Days in claims payable (DCP) of 42.6 days at June 30, 2023 represented an increase of 1.4 days from 41.2 days at March 31, 2023, and a decrease of 3.4 days from 46.0 days at June 30, 2022.

The 3.4-day year-over-year decrease was primarily driven by higher fee-for-service claims expense per day in 2Q23 due to the COVID related disruption in utilization in 2022, coupled with a change in processed claims inventory.

•Humana's debt-to-total capitalization at June 30, 2023 decreased 10 basis points to 41.0 percent from 41.1 percent at March 31, 2023 primarily resulting from the impact of 2Q23 net earnings, partially offset by the net issuance of commercial paper.

YTD 2023 GAAP operating cash flows were significantly impacted by the timing of the premium payment from CMS. The company received its $7.0 billion July 2023 Medicare premium payment early in June 2023. This resulted in seven payments being received in YTD 2023 compared to only six received in YTD 2022.

Additionally, the year-over-year GAAP comparison reflected the 2023 receipt of the CMS mid-year settlement in June 2023, while the 2022 CMS mid-year settlement was not received until July 2022.

The year-over-year comparison in operating cash flows further reflected higher earnings in YTD 2023 compared to YTD 2022, and excluding the impact of items noted above, was partially offset by the negative impact of working capital items.

*Under Rule 10b5-1, the company began initiating open market repurchases in March 2023 as part of the Board of Directors' February 2023 $3.0 billion stock repurchase authorization.

The Adjusted (non-GAAP) metrics represent the exclusion of the company's employer group commercial medical products business as a result of the company's announcement on February 23, 2023 to exit the business; 2Q22 and YTD 2022 Adjusted metrics have also been recast to exclude the impact of the exit. Refer to the "Footnotes" section included herein for further explanation on reasoning for Adjusted (non-GAAP) disclosures, as well as reconciliations.

The year-over-year quarter and YTD increases in Insurance segment GAAP revenues primarily reflect the following items:

•individual Medicare Advantage and state-based contracts membership growth; and

•higher per member individual Medicare Advantage premiums.

•the phase-out of COVID-19 sequestration relief in 2022; and

•the anticipated decline in year-over-year membership associated with the company's group commercial medical, group Medicare Advantage and stand-alone PDP products.

The increase in the GAAP ratio from 2Q22 to 2Q23 reflects the following:

•investments in the benefit design of the company's products for 2023,

•higher Medicare Advantage utilization trends in 2Q23 as previously discussed, and

•the impact of continued strong individual Medicare Advantage growth following the AEP, including a higher-than-expected proportion of age-ins, which typically have a higher benefits expense ratio initially than the average new member.

•increased individual Medicare Advantage premium yield,

•higher favorable Prior Period Development in 2Q23, and

•lower COVID-19 inpatient utilization in 2Q23, and corresponding decrease in average unit cost given the additional 20 percent payment on these admissions during the PHE.    

The year-over-year decrease in the GAAP ratio from YTD 2022 reflects the following factors:

•increased individual Medicare Advantage premium yield,

•lower COVID-19 inpatient utilization in YTD 2023, and corresponding decrease in average unit cost given the additional 20 percent payment on these admissions during the PHE, and

•higher favorable Prior Period Development in YTD 2023.

Furthermore, the 2Q23 and YTD 2023 ratios continue to reflect a shift in line of business mix within the segment, with growth in individual Medicare Advantage and state-based contracts and other membership, which can carry a higher benefits expense ratio.

The increase in the segment's 2Q23 and YTD 2023 GAAP operating cost ratios from the respective 2022 periods primarily reflects the following:

•an increase in commissions for brokers related to the significant individual Medicare Advantage membership growth in 2023,

•the favorable impact to revenues in 2022 as a result of sequestration relief, and

•accrual related to certain anticipated litigation expenses in 2Q23.

•scale efficiencies associated with growth in the company's individual Medicare Advantage membership; and

•the impact of initiatives related to the previously-disclosed value creation plan.

Insurance Segment Enrollment:

Individual Medicare Advantage membership includes 831,400 Dual Eligible Special Need Plans (D-SNP) members as of June 30, 2023, a net increase of 170,200, or 26 percent, from 661,200 as of June 30, 2022, and up 162,500, or 24 percent, from 668,900 as of December 31, 2022.

State-based contracts and other membership as of June 30, 2023 reflects the impact of membership additions associated with the implementation of the Louisiana (effective January 2023) and Ohio contracts (effective February 2023), partially offset by ending the suspension of state eligibility redetermination efforts previously enacted as part of the PHE.

This segment includes pharmacy (excluding the PBM operations), provider, and home solutions. The segment also includes the impact of non-consolidating minority interest investments related to the company's strategic partnerships with Welsh, Carson, Anderson & Stowe (WCAS) to develop and operate senior-focused, payor-agnostic, primary care centers, as well as the Gentiva (formerly Kindred) Hospice operations. Services offered by this segment are designed to enhance the overall healthcare experience. These services may lead to lower utilization associated with improved member health and/or lower drug costs.

CenterWell segment revenues increased in 2Q23 and YTD 2023 compared to the respective periods in 2022; these increases were impacted by the following factors:

◦the company's individual Medicare Advantage membership growth, which led to higher pharmacy revenues,

◦higher revenues associated with growth in the company's provider business, and

◦greater intersegment revenues associated with the Home Solutions business as a result of the expansion of the value-based care home model in 2023 compared to the prior year.

These increases were partially offset by the divestiture of the company's 60 percent ownership of Gentiva (formerly Kindred) Hospice in August 2022.

The year-over-year increase in the 2Q23 and YTD 2023 operating cost ratios compared to the respective periods in 2022 primarily resulted from the following factors:

◦previously discussed divestiture of the company's 60 percent ownership of Gentiva (formerly Kindred) Hospice operations, which had a lower operating cost ratio than other businesses within the segment,

◦the expansion of the value-based care model within the Home Solutions business, which carries a higher operating cost ratio compared to the core fee-for-service business, along with growth in Medicare Advantage episodes in the core fee-for-service business, and

◦continued investments within the Home Solutions business to abate the pressures of the current nursing labor environment.

For YTD 2023, these increases were partially offset by an improving ratio in the company's provider business driven by year-over-year medical costs favorability.

See additional operational metrics for the CenterWell segment on pages S-14 through S-16 of the statistical supplement included in this release.

(a) 2Q23 Adjusted results exclude the following:

•Amortization expense for identifiable intangibles - GAAP measures affected in this release include consolidated pretax results, EPS, and Insurance and CenterWell segments income from operations (including amortization expense of $6 million in the Insurance segment and $10 million in the CenterWell segment).

•Put/call valuation adjustments associated with Humana’s non-consolidating minority interest investments - GAAP measures affected include consolidated pretax results and EPS.

•Transaction and integration costs - GAAP measures affected include consolidated pretax results, EPS, and the consolidated operating cost ratio.

•Impact of exit of employer group commercial medical products business - GAAP measures affected include consolidated pretax results, EPS, consolidated revenues, consolidated benefit expense ratio, consolidated operating cost ratio, Insurance segment revenues, Insurance segment benefit expense ratio, Insurance segment operating cost ratio, and Insurance segment income from operations.

•Accrual related to certain anticipated litigation expenses - GAAP measures affected in this release include consolidated pretax results, EPS, Insurance segment income from operations, and the consolidated and Insurance segment operating cost ratios.

•Cumulative net tax benefit of adjustments - EPS is the only GAAP measure affected.

(b) 2Q22 Adjusted results exclude the following:

•Amortization expense for identifiable intangibles - GAAP measures affected in this release include consolidated pretax results, EPS, and Insurance and CenterWell segments income from operations (including amortization expense of $5 million in the Insurance segment and $13 million in the CenterWell segment).

•Put/call valuation adjustments associated with Humana’s non-consolidating minority interest investments - GAAP measures affected include consolidated pretax results and EPS.

•Transaction and integration costs - GAAP measures affected include consolidated pretax results, EPS, and the consolidated operating cost ratio.

•Change in fair market value of publicly-traded equity securities - GAAP measures affected include consolidated pretax results, EPS, and consolidated revenues.

•Impact of exit of employer group commercial medical products business - GAAP measures affected include consolidated pretax results, EPS, consolidated revenues, consolidated benefit expense ratio, consolidated operating cost ratio, Insurance segment revenues, Insurance segment benefit expense ratio, Insurance segment operating cost ratio, and Insurance segment income from operations.

•Charges primarily related to asset and software impairment and abandonment, as a result of initiatives undertaken associated with the company's previously disclosed $1 billion value creation - GAAP measures affected in this release include consolidated pretax, EPS, and the consolidated operating cost ratio.

•Impact related to the recognition of a deferred tax liability in connection with the held-for-sale classification of Kindred at Home's (KAH) Hospice and Personal Care divisions resulting from the company's then pending sale of the business - EPS is the only GAAP measure affected in this release.

•Cumulative net tax benefit of adjustments (excluding the impact of the tax impact related to KAH note in above bullet point) - EPS is the only GAAP measure affected.

(c) YTD 2023 Adjusted results exclude the following:

•Amortization expense for identifiable intangibles - GAAP measures affected in this release include consolidated pretax results, EPS, and Insurance and CenterWell segments income from operations (including amortization expense of $11 million in the Insurance segment and $23 million in the CenterWell segment).

•Put/call valuation adjustments associated with Humana’s non-consolidating minority interest investments - GAAP measures affected include consolidated pretax results and EPS.

•Transaction and integration costs - GAAP measures affected include consolidated pretax results, EPS, and the consolidated operating cost ratio.

•Change in fair market value of publicly-traded equity securities - GAAP measures affected include consolidated pretax results, EPS, and consolidated revenues.

•Impact of exit of employer group commercial medical products business - GAAP measures affected include consolidated pretax results, EPS, consolidated revenues, consolidated benefit expense ratio, consolidated operating cost ratio, Insurance segment revenues, Insurance segment benefit expense ratio, Insurance segment operating cost ratio, and Insurance segment income from operations.

•Accrual related to certain anticipated litigation expenses - GAAP measures affected in this release include consolidated pretax results, EPS, Insurance segment income from operations, and the consolidated and Insurance segment operating cost ratios.

•Cumulative net tax benefit of adjustments - EPS is the only GAAP measure affected.

(d) YTD 2022 Adjusted results exclude the following:

•Amortization expense for identifiable intangibles - GAAP measures affected in this release include consolidated pretax results, EPS, and Insurance and CenterWell segments income from operations (including amortization expense of $10 million in the Insurance segment and $26 million in the CenterWell segment).

•Put/call valuation adjustments associated with Humana’s non-consolidating minority interest investments - GAAP measures affected include consolidated pretax results and EPS.

•Transaction and integration costs - GAAP measures affected include consolidated pretax results, EPS, and the consolidated operating cost ratio.

•Change in fair market value of publicly-traded equity securities - GAAP measures affected include consolidated pretax results, EPS, and consolidated revenues.

•Charges primarily related to asset and software impairment and abandonment, as a result of initiatives undertaken associated with the company's previously disclosed $1 billion value creation - GAAP measures affected in this release include consolidated pretax, EPS, and the consolidated operating cost ratio.

•Impact related to the recognition of a deferred tax liability in connection with the held-for-sale classification of Kindred at Home's Hospice and Personal Care divisions resulting from the company's then pending sale of the business - EPS is the only GAAP measure affected in this release.

•Cumulative net tax benefit of adjustments (excluding the impact of the tax impact related to KAH note in above bullet point) - EPS is the only GAAP measure affected.

(g) FY 2023 projected Adjusted results exclude the following:

•FY 2023 GAAP EPS excludes the YTD 2023 impact of fair value changes of the put/call options associated with Humana's non-consolidating minority interest investments as future value changes can not be estimated.

•The fair value of publicly-traded securities, their impact on GAAP EPS, and the related non-GAAP adjustment will fluctuate depending on the public trading value of the stock. The guidance set forth herein assumes no further change in the fair value of those investments, other than the YTD 2023 adjustment.

•Transaction and integration costs reflect the impact of YTD 2023 activity.

(h) The company provides a full range of insured specialty products including dental, vision, and life insurance benefits marketed to individuals and groups. Members included in these products may not be unique to each product since members have the ability to enroll in a medical product and one or more specialty products.

•If Humana does not design and price its products properly and competitively, if the premiums Humana receives are insufficient to cover the cost of healthcare services delivered to its members, if the company is unable to implement clinical initiatives to provide a better healthcare experience for its members, lower costs and appropriately document the risk profile of its members, or if its estimates of benefits expense are inadequate, Humana’s profitability could be materially adversely affected. Humana estimates the costs of its benefit expense payments, and designs and prices its products accordingly, using actuarial methods and assumptions based upon, among other relevant factors, claim payment patterns, medical cost inflation, and historical developments such as claim inventory levels and claim receipt patterns. The company continually reviews estimates of future payments relating to benefit expenses for services incurred in the current and prior periods and makes necessary adjustments to its reserves, including premium deficiency reserves, where appropriate. These estimates involve extensive judgment, and have considerable inherent variability because they are extremely sensitive to changes in claim payment patterns and medical cost trends. Accordingly, Humana's reserves may be insufficient.

•If Humana fails to effectively implement its operational and strategic initiatives, including its Medicare initiatives, which are of particular importance given the concentration of the company's revenues in these products, state-based contract strategy, the growth of its CenterWell business, and its integrated care delivery model, the company’s business may be materially adversely affected. In addition, there can be no assurances that the company will be successful in maintaining or improving its Star ratings in future years.

•If Humana fails to properly maintain the integrity of its data, to strategically maintain existing or implement new information systems, to protect Humana’s proprietary rights to its systems, or to defend against cyber-security attacks or prevent other privacy or data security incidents that result in security breaches that disrupt the company's operations or in the unintentional dissemination of sensitive personal information or proprietary or confidential information, the company’s business may be materially adversely affected.

•Humana is involved in various legal actions, or disputes that could lead to legal actions (such as, among other things, provider contract disputes and qui tam litigation brought by individuals on behalf of the government), governmental and internal investigations, and routine internal review of business processes any of which, if resolved unfavorably to the company, could result in substantial monetary damages or changes in its business practices. Increased litigation and negative publicity could also increase the company’s cost of doing business.

•As a government contractor, Humana is exposed to risks that may materially adversely affect its business or its willingness or ability to participate in government healthcare programs including, among other things, loss of material government contracts; governmental audits and investigations; potential inadequacy of government determined payment rates; potential restrictions on profitability, including by comparison of profitability of the company’s Medicare Advantage business to non-Medicare Advantage business; or other changes in the governmental programs in which Humana participates. Changes to the risk-adjustment model utilized by CMS to adjust premiums paid to Medicare Advantage plans or retrospective recovery by CMS of previously paid premiums as a result of the final rule related to the risk adjustment data validation audit methodology published by CMS on January 30, 2023 (Final RADV Rule), which Humana believes fails to address adequately the statutory requirement of actuarial equivalence due to its failure to include a "Fee for Service Adjuster (FFS Adjuster)" could have a material adverse effect on the company's operating results, financial position and cash flows.

•Humana's business activities are subject to substantial government regulation. New laws or regulations, or legislative, judicial, or regulatory changes in existing laws or regulations or their manner of application could increase the company's cost of doing business and have a material adverse effect on Humana’s results of operations (including restricting revenue, enrollment and premium growth in certain products and market segments, restricting the company’s ability to expand into new markets, increasing the company’s medical and operating costs by, among other things, requiring a minimum benefit ratio on insured products, lowering the company’s Medicare payment rates and increasing the company’s expenses associated with a non-deductible health insurance industry fee and other assessments); the company’s financial position (including the company’s ability to maintain the value of its goodwill); and the company’s cash flows.

•Humana’s failure to manage acquisitions, divestitures and other significant transactions successfully may have a material adverse effect on the company’s results of operations, financial position, and cash flows.

•If Humana fails to develop and maintain satisfactory relationships with the providers of care to its members, the company’s business may be adversely affected.

•Humana faces significant competition in attracting and retaining talented employees. Further, managing succession for, and retention of, key executives is critical to the Company’s success, and its failure to do so could adversely affect the Company’s businesses, operating results and/or future performance.

•Humana’s pharmacy business is highly competitive and subjects it to regulations and supply chain risks in addition to those the company faces with its core health benefits businesses.

•Changes in the prescription drug industry pricing benchmarks may adversely affect Humana’s financial performance.

•Humana’s ability to obtain funds from certain of its licensed subsidiaries is restricted by state insurance regulations.

•Downgrades in Humana’s debt ratings, should they occur, may adversely affect its business, results of operations, and financial condition.

•The securities and credit markets may experience volatility and disruption, which may adversely affect Humana’s business.

•The spread of, and response to, the novel coronavirus, or COVID-19, underscores certain risks Humana faces, including those discussed above, and the ongoing, heightened uncertainty created by the pandemic precludes any prediction as to the ultimate adverse impact to Humana of COVID-19.

•Form 10-K for the year ended December 31, 2022;

•Form 10-Q for the quarter ended March 31, 2023; and

•Form 8-Ks filed during 2023.

Humana Inc. is committed to putting health first – for our teammates, our customers, and our company. Through our Humana insurance services, and our CenterWell health care services, we make it easier for the millions of people we serve to achieve their best health – delivering the care and service they need, when they need it.

These efforts are leading to a better quality of life for people with Medicare, Medicaid, families, individuals, military service personnel, and communities at large. Learn more about what we offer at Humana.com and at CenterWell.com.

Consolidated Balance Sheets (Unaudited)

Consolidated Statements of Cash Flows (Unaudited) Dollars in millions

			For the six months ended June 30,
			2023			2022
Cash flows from operating activities
Net income			$	2,194		$	1,627
Adjustments to reconcile net income to net cash provided by operating activities:
Loss on investment securities, net			45			137
Equity in net losses			27			2
Impairment of property and equipment			—			140
Depreciation			410			369
Amortization			34			45
Stock-based compensation			89			93
Deferred income taxes			—			167
Changes in operating assets and liabilities, net of effect of businesses acquired and dispositions:
Receivables			269			(1,733)
Other assets			(1,141)			(655)
Benefits payable			978			1,361
Other liabilities			(170)			(333)
Unearned revenues			7,092			10
Other, net			36			31
Net cash provided by operating activities			9,863			1,261
Cash flows from investing activities
Acquisitions, net of cash and cash equivalents acquired			(189)			(167)
Purchases of property and equipment, net			(487)			(574)
Purchases of investment securities			(2,737)			(3,239)
Maturities of investment securities			577			947
Proceeds from sales of investment securities			811			1,363
Net cash used in investing activities			(2,025)			(1,670)
Cash flows from financing activities
Receipts from contract deposits, net			3,510			3,076
Proceeds from issuance of senior notes			1,215			744
Repayment of senior notes			(349)			—
Proceeds (repayment) from the issuance of commercial paper, net			238			(418)
Repayment of term loan			(500)			—
Debt issue costs			(4)			(2)
Change in book overdraft			159			65
Common stock repurchases			(623)			(1,028)
Dividends paid			(211)			(191)
Other			(120)			(11)
Net cash provided by financing activities			3,315			2,235
Increase in cash and cash equivalents			11,153			1,826
Cash and cash equivalents at beginning of period			5,061			3,394
Cash and cash equivalents at end of period			$	16,214		$	5,220