•Reports 1Q25 earnings per share (EPS) of $10.30 on a GAAP basis, Adjusted EPS of $11.58

•1Q25 Insurance segment benefit ratio of 87.4 percent, in line with the company's previously disclosed expectation of 'approximately 87.5 percent'

•Affirms Adjusted FY 2025 EPS guidance of 'approximately $16.25'; while revising GAAP EPS to 'approximately $14.68' from the previous estimate of 'approximately $15.88'

•Affirms FY 2025 Insurance segment benefit ratio guidance range of 90.1 percent to 90.5 percent

•Affirms expected individual Medicare Advantage annual membership decline of approximately 550,000, inclusive of the impact of exiting certain unprofitable plans and counties

•Continues to advance the company's long-term strategy with achievements within the CenterWell and Medicaid businesses

•Publishes prepared management remarks to Investor Relations page of www.humana.com ahead of this morning's 8:00 a.m. ET question and answer session to discuss its financial results for the quarter and expectations for future earnings

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 revises its GAAP EPS guidance for the year ending December 31, 2025 (FY 2025) to 'approximately $14.68' from 'approximately $15.88', while affirming its Adjusted EPS guidance of 'approximately $16.25'.

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).

Humana will host a live question-and-answer session for analysts at 8:00 a.m. Eastern time today to discuss its financial results for the quarter and the company’s expectations for future earnings. In advance of the question-and-answer session, Humana will post prepared management remarks to the Quarterly Results section of its Investor Relations page (https://humana.gcs-web.com/financial-information/quarterly-results).

•Amortization associated with identifiable intangibles - Since amortization varies based on the size and timing of acquisition activity, management believes this exclusion provides a more consistent and uniform indicator of performance from period to period. For all periods shown within this earnings release, GAAP measures affected include consolidated pretax results, EPS, and Insurance and CenterWell segments' income from operations. The table below discloses respective period amortization expense for each segment:

•Put/call valuation adjustments associated with the company’s non-consolidating minority interest investments - These amounts are the result of fair value measurements associated with the company's primary care strategic partnership and are unrelated to the company's core business operations. For all periods shown within this earnings release, GAAP measures affected include consolidated pretax results and EPS.

•Value creation initiatives - These charges relate to the company's ongoing initiative to drive additional value for the enterprise through cost saving, productivity initiatives, and value creation from previous investments, and primarily consist of asset impairment, severance charges, and external consulting spend specific to these initiatives. These charges were recorded at the corporate level and not allocated to the segments. For all periods shown within this earnings release, GAAP measures affected in this release include consolidated pretax results, EPS, and the consolidated operating cost ratio.

•Impact of exit of employer group commercial medical products business - These amounts relate to activity from the exit of the employer group commercial medical products business as announced by Humana on February 23, 2023. For 1Q24, GAAP measures affected in this earnings release include consolidated pretax results, EPS, consolidated revenues, consolidated operating cost ratio, Insurance segment revenues, Insurance segment benefit ratio, Insurance segment operating cost ratio, and Insurance segment income from operations.

•Impairment charges - The company recognized non-cash impairment charges in 2024 related to certain indefinite-lived intangible assets based on the company's estimate of future financial performance in certain state markets. These charges were recorded at the corporate level and not allocated to the segments. No impact to 1Q25 or 1Q24 results.

•Cumulative net tax impact - This adjustment represents the cumulative net impact of the corresponding tax benefit or expense related to the aforementioned items excluded from the applicable GAAP measures. For all periods presented in this earnings release, EPS is the sole GAAP measure affected.

•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.

•The number of Humana’s Medicare Advantage plans rated 4-star or higher will significantly decline in 2025. Humana has filed a lawsuit seeking to set aside and vacate the 2025 Star Ratings of its Medicare Advantage plans, but there is no assurance that the company will prevail in this lawsuit. If the company is not successful, the decline in Star Ratings will negatively impact its 2026 quality bonus payments from CMS and may also significantly adversely affect the company’s revenues, operating results, and cash flows. In addition, there can be no assurances the company will be successful in maintaining or improving its Star Ratings in future years.

•If Humana, or the third-party service providers on which it relies, 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, contain such attacks when they occur, 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 and violates the Administrative Procedure Act due to its failure to include a "Fee for Service 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.

•Volatility or disruption in the securities and credit markets may significantly and adversely affect the value of our investment portfolio and the investment income that we derive from this portfolio.

•Form 10-K for the year ended December 31, 2024;

•Form 8-Ks filed during 2025.

n e w s r e l e a s e

                                        

•Reports 1Q25 earnings per share (EPS) of $10.30 on a GAAP basis, Adjusted EPS of $11.58

•1Q25 Insurance segment benefit ratio of 87.4 percent, in line with the company's previously disclosed expectation of 'approximately 87.5 percent'

•Affirms Adjusted FY 2025 EPS guidance of 'approximately $16.25'; while revising GAAP EPS to 'approximately $14.68' from the previous estimate of 'approximately $15.88'

•Affirms FY 2025 Insurance segment benefit ratio guidance range of 90.1 percent to 90.5 percent

•Affirms expected individual Medicare Advantage annual membership decline of approximately 550,000, inclusive of the impact of exiting certain unprofitable plans and counties

•Continues to advance the company's long-term strategy with achievements within the CenterWell and Medicaid businesses

•Publishes prepared management remarks to Investor Relations page of www.humana.com ahead of this morning's 8:00 a.m. ET question and answer session to discuss its financial results for the quarter and expectations for future earnings

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.

Humana revises its GAAP EPS guidance for the year ending December 31, 2025 (FY 2025) to 'approximately $14.68' from 'approximately $15.88', while affirming its Adjusted EPS guidance of 'approximately $16.25'. Additional FY 2025 guidance points are included on page 12 of this earnings release.

The favorable year-over-year GAAP consolidated revenues comparison was primarily driven by the following factors:

•higher per member Medicare and state-based contracts premiums; the Medicare increase was driven largely by an increased direct subsidy due to the Inflation Reduction Act (IRA), and

•membership growth in the company's stand-alone PDP and state-based contracts businesses.

These factors were partially offset by the membership decline within the individual Medicare Advantage business, inclusive of the company's decision to exit certain unprofitable plans and counties.

The year-over-year decline in the GAAP consolidated benefit ratio primarily reflected the following items:

•individual Medicare Advantage pricing inclusive of plan exits, benefit design changes, and favorable workday impacts in 1Q25 more than offsetting claims trend and the funding environment, and

•the change in Medicare Part D seasonality due to the IRA.

•a shift in line of business mix resulting from reductions in individual Medicare Advantage membership, combined with growth in the stand-alone PDP and state-based contracts businesses, which carry a higher benefit ratio,

•delayed flu season that led to a more acute period in 1Q25 compared to 1Q24, and

•lower favorable prior period medical claims reserve development.

The year-over-year increase in the GAAP consolidated operating cost ratio from 1Q24 primarily resulted from business mix changes, including within the CenterWell segment which runs a significantly higher operating cost ratio than the Insurance segment, combined with the operating leverage impact of the loss of individual Medicare Advantage membership.

This was partially offset by the following items:

•administrative cost efficiencies resulting from the company's value creation initiatives, and

•operating leverage associated with increased revenues from the impact of the IRA as described above.

•Days in claims payable (DCP) of 38.8 days at March 31, 2025 represented an increase of 1.0 day from 37.8 days at December 31, 2024 and a decrease of 3.7 days from 42.5 days at March 31, 2024.

The 1.0 day sequential increase was primarily driven by increased processed claims inventory as of March 31, 2025 compared to December 31, 2024.

The 3.7 days year-over-year decrease was primarily driven by an increased proportion of Medicare prescription drug benefit expense as a result of structural changes associated with the IRA. Pharmacy claims are processed more quickly than medical claims leading to a lower DCP.

•Humana's debt-to-total capitalization at March 31, 2025 increased 90 basis points to 42.8 percent from 41.9 percent at December 31, 2024 primarily driven by the $1.5 billion issuance of senior notes in March 2025, partially offset by the impact of 1Q25 net earnings.

The year-over-year decrease in GAAP operating cash flows primarily reflected the unfavorable impact of working capital items, partially offset by higher earnings in 1Q25.

The year-over-year increase in GAAP segment revenues from 1Q24 primarily reflected the following items:

•higher per member Medicare and state-based contracts premiums; the Medicare increase was driven largely by an increased direct subsidy due to the IRA, and

•membership growth in the company's stand-alone PDP and state-based contracts businesses.

These factors were partially offset by the membership decline within the individual Medicare Advantage business, inclusive of the company's decision to exit certain unprofitable plan and counties.

The year-over-year decline in the GAAP segment benefit ratio primarily reflected the following items:

•individual Medicare Advantage pricing inclusive of plan exits, benefit design changes, and favorable workday impacts in 1Q25 more than offsetting claims trend and the funding environment, and

•the change in Medicare Part D seasonality due to the IRA.

•a shift in line of business mix resulting from reductions in individual Medicare Advantage membership, combined with growth in the stand-alone PDP and state-based contracts businesses, which carry a higher benefit ratio,

•delayed flu season which led to a more acute period in 1Q25 compared to 1Q24, and

•lower favorable prior period medical claims reserve development.

The year-over-year decrease in the GAAP segment operating cost ratio from 1Q24 primarily related to the following:

•administrative cost efficiencies resulting from the company's value creation initiatives, and

•operating leverage associated with increased revenues from the impact of the IRA as described above.

These factors were partially offset by the operating leverage impact of the loss of individual Medicare Advantage membership.

The favorable year-over-year CenterWell segment revenues comparison was primarily driven by higher revenues associated with growth in the company's primary care business, partially offset by the impact of the v28 risk model revision.

The year-over-year decrease in the segment's operating cost ratio primarily resulted from the following:

•administrative cost efficiencies resulting from the company's value creation initiatives, and

•more favorable operating trends in the primary care business in 1Q25 as a result of stabilizing medical cost trends and maturation of the company's v28 mitigation activities, partially offset by the continued phase-in of v28.

See additional operational metrics for the CenterWell segment on pages S-11 through S-13 of the statistical supplement included in this earnings release.

Humana will host a live question-and-answer session for analysts at 8:00 a.m. Eastern time today to discuss its financial results for the quarter and the company’s expectations for future earnings. In advance of the question-and-answer session, Humana will post prepared management remarks to the Quarterly Results section of its Investor Relations page (https://humana.gcs-web.com/financial-information/quarterly-results).

•Amortization associated with identifiable intangibles - Since amortization varies based on the size and timing of acquisition activity, management believes this exclusion provides a more consistent and uniform indicator of performance from period to period. For all periods shown within this earnings release, GAAP measures affected include consolidated pretax results, EPS, and Insurance and CenterWell segments' income from operations. The table below discloses respective period amortization expense for each segment:

•Put/call valuation adjustments associated with the company’s non-consolidating minority interest investments - These amounts are the result of fair value measurements associated with the company's primary care strategic partnership and are unrelated to the company's core business operations. For all periods shown within this earnings release, GAAP measures affected include consolidated pretax results and EPS.

•Value creation initiatives - These charges relate to the company's ongoing initiative to drive additional value for the enterprise through cost saving, productivity initiatives, and value creation from previous investments, and primarily consist of asset impairment, severance charges, and external consulting spend specific to these initiatives. These charges were recorded at the corporate level and not allocated to the segments. For all periods shown within this earnings release, GAAP measures affected in this release include consolidated pretax results, EPS, and the consolidated operating cost ratio.

•Impact of exit of employer group commercial medical products business - These amounts relate to activity from the exit of the employer group commercial medical products business as announced by Humana on February 23, 2023. For 1Q24, GAAP measures affected in this earnings release include consolidated pretax results, EPS, consolidated revenues, consolidated operating cost ratio, Insurance segment revenues, Insurance segment benefit ratio, Insurance segment operating cost ratio, and Insurance segment income from operations.

•Impairment charges - The company recognized non-cash impairment charges in 2024 related to certain indefinite-lived intangible assets based on the company's estimate of future financial performance in certain state markets. These charges were recorded at the corporate level and not allocated to the segments. No impact to 1Q25 or 1Q24 results.

•Cumulative net tax impact - This adjustment represents the cumulative net impact of the corresponding tax benefit or expense related to the aforementioned items excluded from the applicable GAAP measures. For all periods presented in this earnings release, EPS is the sole GAAP measure affected.

(c) The CenterWell segment Adjusted income from operations includes an adjustment to add back depreciation and amortization expense to the segment's GAAP income from operations since such an adjustment is commonly utilized for valuation purposes within the healthcare delivery industry.

•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.

•The number of Humana’s Medicare Advantage plans rated 4-star or higher will significantly decline in 2025. Humana has filed a lawsuit seeking to set aside and vacate the 2025 Star Ratings of its Medicare Advantage plans, but there is no assurance that the company will prevail in this lawsuit. If the company is not successful, the decline in Star Ratings will negatively impact its 2026 quality bonus payments from CMS and may also significantly adversely affect the company’s revenues, operating results, and cash flows. In addition, there can be no assurances the company will be successful in maintaining or improving its Star Ratings in future years.

•If Humana, or the third-party service providers on which it relies, 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, contain such attacks when they occur, 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 and violates the Administrative Procedure Act due to its failure to include a "Fee for Service 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.

•Volatility or disruption in the securities and credit markets may significantly and adversely affect the value of our investment portfolio and the investment income that we derive from this portfolio.

•Form 10-K for the year ended December 31, 2024;

•Form 8-Ks filed during 2025.

Consolidated Balance Sheets (Unaudited)

Consolidated Statements of Cash Flows (Unaudited) Dollars in millions

			For the three months ended March 31,
			2025			2024
Cash flows from operating activities
Net income			$	1,242		$	739
Adjustments to reconcile net income to net cash provided by operating activities:
Gain on investment securities, net			(2)			(1)
Equity in net losses			43			24
Stock-based compensation			49			45
Depreciation			200			226
Amortization			15			16
Impairment of property and equipment			9			33
Changes in operating assets and liabilities, net of effect of businesses acquired and disposed:
Receivables			(1,755)			(1,890)
Other assets			(686)			97
Benefits payable			1,011			1,488
Other liabilities			193			(422)
Unearned revenues			5			35
Other, net			7			33
Net cash provided by operating activities			331			423
Cash flows from investing activities
Acquisitions, net of cash and cash equivalents acquired			—			(14)
Purchases of property and equipment, net			(95)			(177)
Changes in securities lending collateral receivable			(175)			—
Purchases of investment securities			(827)			(1,259)
Maturities of investment securities			889			645
Proceeds from sales of investment securities			522			391
Net cash provided by (used in) investing activities			314			(414)
Cash flows from financing activities
(Payments) receipts from contract deposits, net			(35)			499
Proceeds from issuance of senior notes, net			1,481			2,232
Repayments from issuance of commercial paper, net			(4)			(644)
Debt issue costs			(3)			(5)
Change in book overdraft			(33)			(20)
Common stock repurchases			(9)			(717)
Dividends paid			(108)			(109)
Change in securities lending payable			175			—
Change in rebate factor payable			(68)			—
Other, net			(12)			(29)
Net cash provided by financing activities			1,384			1,207
Increase in cash and cash equivalents			2,029			1,216
Cash and cash equivalents at beginning of period			2,221			4,694
Cash and cash equivalents at end of period			$	4,250		$	5,910

Membership Detail (Unaudited)

*Individual Medicare Advantage membership includes 799,100 Dual Eligible Special Need Plans (D-SNP) members as of March 31, 2025, a net decrease of 123,100, or 13 percent, from 922,200 as of March 31, 2024, and down 138,000, or 15 percent, from 937,100 as of December 31, 2024.

A.Net losses associated with the company's non-consolidated minority interest investments.

B.Fully-insured dental membership as reported does not include Humana members that have a Medicare Advantage plan that includes an embedded dental benefit.

C.In certain circumstances, the company contracts with providers to accept financial risk for a defined set of Medicare Advantage membership. For these Downside Risk arrangements, the provider is measured against a medical expense ratio target and the company may share savings from reduction to the total cost of care of the defined membership. The result is a high level of engagement on the part of the provider. Under these arrangements, the company may contract with providers to accept partial, full, or global financial risk. In certain instances (capitated shared risk) of these arrangements, the company may choose to prepay these providers a monthly fixed-fee per member to coordinate substantially all of the medical care for their Medicare Advantage members assigned or attributed to their provider panel, including some health benefit administrative functions and claims processing.

D.A Path to Risk provider is one who has a high level of engagement and has contracted with the company to participate in an Upside Only/Shared Savings total cost of care arrangement and/or in one of Humana’s Quality Bonus programs (Model Practice), through which the company rewards the provider for achieving quality and utilization targets. Providers who are contracted in an Upside Only/Shared Savings arrangement may receive a portion of achieved surpluses when the actual cost of the medical services provided to patients assigned or attributed to their panel is less than the agreed upon medical expense targets. These contracts may also include a Downside Risk trigger (future date or membership threshold) which has not yet been met.

E.Per Member per Month (PMPM) shown reflects only Medicaid premiums and average Medicaid membership for the period; includes impact of dual eligible demonstration members.

F.Fully-insured commercial medical premiums also include stop-loss premiums associated with the commercial ASO product; for purposes of the PMPM metric, the commercial ASO stop-loss premiums have been excluded.

G.Specialty per member per month is computed based on reported specialty premiums and average fully-insured specialty membership for the period.

H.The amounts primarily reflect services revenues under the TRICARE East Region contract that generally are contracted on a per-member basis.

I.Computed based on average membership for the period (i.e. monthly ending membership during the period divided by the number of months in the period).

J.De novo refers to all new centers opened or acquired since 2020 under a WCAS joint venture. Wholly-owned refers to all centers outside a WCAS joint venture.

K.Represents Medicare Advantage (MA) risk, MA path to risk, MA value-based, Direct Contracting Entity, and Accountable Care Organization patients.

L.Reflects patient admissions under the Patient Driven Groupings Model (PDGM) payment model.

M.Reflects all patient admissions regardless of reimbursement model. Same store is defined as care centers that have been owned and operated at least the last twelve months and startups that are an expansion of a same store care center.

Please view these remarks in conjunction with our 1Q 2025 earnings release that can be found on our website at www.humana.com under the Investors section, or via the following link: https://humana.gcs-web.com/financial-information/quarterly-results.

We also invite you to listen to our live question and answer webcast with our President and Chief Executive Officer, Jim Rechtin, Chief Financial Officer, Celeste Mellet, and President of Insurance, George Renaudin, which will begin today at 8:00 a.m. Eastern Time and will be available at via the following link: https://humana.gcs-web.com/events-and-presentations/upcoming-events. For those unable to listen to the live event, the archive will be available in the Historical Webcasts and Presentations section of the Investor Relations page via the following link: https://humana.gcs-web.com/events-and-presentations.

Certain of the matters discussed in these prepared remarks are forward-looking and are subject to a number of risks, uncertainties and assumptions. Actual results could differ materially.

Investors are advised to read the detailed risk factors discussed in our latest Form 10-K, our other filings with the Securities and Exchange Commission, and our 1Q 2025 earnings release as they relate to forward-looking statements along with other risks discussed in our SEC filings. We undertake no obligation to publicly address or update any forward-looking statements in future filings or communications regarding our business or results.

Today’s release, our historical financial news releases and our filings with the SEC are all also available on our Investor Relations site.

These remarks include financial measures that are not in accordance with generally accepted accounting principles, or GAAP.

Management's explanation for the use of these non-GAAP measures and reconciliations of GAAP to non-GAAP financial measures are included in today’s release which can be found via the following link: https://humana.gcs-web.com/financial-information/quarterly-results.

Finally, any references to earnings per share or EPS made within these remarks refer to diluted earnings per common share.

•We are pleased with a solid start to 2025. Our first quarter Insurance segment benefit ratio of 87.4% reflects medical cost trends that developed in line with our expectations, while our first quarter Adjusted EPS was ahead of expectations largely driven by:

oA shift in expected timing of certain administrative expenses and incremental investments, and

oOutperformance in CenterWell, inclusive of certain timing related items

•Based on results to date, we reaffirmed our 2025 guidance, including:

oAdjusted EPS outlook of ‘approximately $16.25’

oInsurance segment benefit ratio guidance range of 90.1% to 90.5%

oFull year 2025 Medicare and Medicaid membership expectations

•We remain committed to achieving individual Medicare Advantage (MA) pretax margin of ‘at least 3%’ over time and remain confident in our expectation that our 2025 MA pricing will drive the intended underlying margin improvement

•We continue to anticipate a “few hundred million dollars” of incremental investments in 2025 to improve member and patient outcomes and support operational excellence, positioning the company for long-term success

oEarly returns on investments made in 2024 and first quarter 2025 are tracking in line with expectations

•Efforts to strengthen our Stars program are progressing as anticipated with initiatives expected to impact across key measures as we focus on a return to a sustainable industry leading position

•We further expanded our CenterWell platform in the first quarter, including:

oGrowth of 27,300 patients, or 7%, in CenterWell Primary Care as compared to December 31, 2024

CenterWell Primary Care patient growth includes 12,600 patients, or 16% growth, in our de novo centers as compared to December 31, 2024

oCenterWell Pharmacy selected as the fulfillment pharmacy for NovoCare® Pharmacy’s weight loss medication for cash pay customers

•We are strategically expanding our Medicaid platform with Illinois’ intent to award Humana their new Fully Integrated Dual Eligible (FIDE) Special Needs Plan (SNP) program which is expected to start in 2026

•Looking ahead, the 2026 final MA rate notice better reflects the medical cost trend environment and should enable greater stability within the industry as it serves the 34 million1 seniors who rely on the MA program for high-quality, affordable care and better health outcomes

oWe will continue to work with the Administration and policymakers in Congress to strengthen the MA program and protect the choices and benefits that seniors rely on

•We look forward to sharing more on our mid- and longer-term outlook at our 2025 Investor Conference on June 16, 2025

•1Q25 year to date (YTD) membership decline of approximately 446,000 is in line with our expectations. We continue to anticipate a full year (FY) 2025 decline of approximately 550,000 members

oMembership losses largely driven by our decision to exit certain unprofitable plans and counties, which impacted approximately 560,000 members

The plan and county exits have been partially offset by net sales activity (gross sales, less voluntary terminations and mortality), including the recapture of approximately 40% of the members impacted by plan exits into other Humana MA plans

oWe remain confident in our pricing strategy as we prioritize serving membership which will drive sustainable, long-term value creation

•1Q25 revenue is in line with our expectations and we continue to expect our premium yield to be in the high single digits for the full year, driven in large part by an increased direct subsidy due to the Inflation Reduction Act (IRA)

•While it remains early in the year, available information to date suggests medical and Rx cost trends are in line with our expectations

•1Q25 YTD membership growth of approximately 27,000 is in line with our expectations and we continue to expect membership to be relatively flat year over year for FY 2025

•Group MA is performing as anticipated to date, with revenue and medical cost trends developing in line with our expectations

•As shared on our fourth quarter 2024 earnings call (in February 2025), Group MA had margin pressure in 2024 that, as expected, continued into 2025 due to multi-year pricing cycles

•We remain focused on improving Group MA margins through renewal cycles to reflect the current reimbursement levels and cost trends, with the opportunity to significantly improve performance through re-contracting in 2026 and beyond

•1Q25 YTD membership growth of approximately 145,000 is in line with expectations; we continue to anticipate FY 2025 membership growth of approximately 200,000

•We are closely monitoring PDP performance given the magnitude of IRA changes implemented this year and the potential impact on member behavior

oPDP membership mix, Rx trends, and member behavior are in line with our expectations to date

•1Q25 YTD membership growth of approximately 106,000, or 8%, compared to December 31, 2024, is in line with expectations, largely driven by additional membership allocation in Kentucky

•Continue to anticipate growth of 175,000 to 250,000 members for FY 2025, representing an increase of approximately 16% for the year at the midpoint, including the anticipated implementation of the Virgina contract later this year

•Early indicators suggest medical cost trends are in line with our expectations

•We continue to anticipate modest improvement in our Medicaid margin in 2025 as additional states progress through the J curve and rates are updated to reflect the acuity level of members and trend experience related to the Public Health Emergency (PHE) unwind

oRate updates for approximately 75% of Medicaid revenue are projected as final for 2025

•Strategically expanding our Medicaid platform with Illinois’ intent to award Humana their new FIDE SNP program which is expected to start in 2026

oThis award includes a distinct, standalone managed long-term services and supports contract, expected to start in 2027

CenterWell outperformed our expectations in the quarter, inclusive of timing related items.

Primary Care

•Serving nearly 418,000 patients as of March 31, 2025, an increase of 27,300 patients, or 7%, from December 31, 2024. Patient growth for the first quarter includes:

o12,600 patients, or 16% growth, in our de novo centers

o7,700 patients, or 3% growth, in our more mature wholly-owned centers; and

o7,000 patients, or nearly 11%, growth in our Independent Physician Associations (IPA) business

•Aiding this patient growth is improved patient satisfaction, which increased Net Promoter Score (NPS) 120 basis points year over year

oImprovement supported by enhanced patient experience data intelligence which creates the ability to convert fragmented feedback into consistent, actionable insights at scale

•Continue to anticipate FY 2025 net patient growth of 30,000 to 50,000, reflecting approximately 10% growth at the midpoint, driven by organic growth, modest M&A, and additional growth with Original Medicare as a part of our ACO Reach program

•Operating 329 centers as of March 31, 2025, representing growth of 30 centers, or 10%, year over year, while representing a reduction of 15 centers, or 4%, from December 31, 2024

oReduction in total centers during 1Q25 YTD is driven by ongoing center footprint optimization in connection with acquisition activity during 2024

7 de novo centers were added during 1Q25, more than offset by the impact of center consolidations as part of the footprint optimization described above

•We still anticipate we will mitigate the ultimate impact of the v28 risk model changes over the three-year phase in through a multi-pronged plan including numerous operational efficiencies such as centralizing and streamlining administrative functions, standardizing the clinic operating model, and improving clinician productivity to increase capacity

oThe impact of v28 and our related mitigation efforts are tracking in line with expectations to date

•Continue to anticipate largely flat margins year over year with the impact of the ongoing phase in of v28 and the addition of centers at various stages of maturation expected to be offset by:

oadvancement of our ongoing v28 mitigation activities, and

ofurther maturation of our existing centers which are progressing through the J curve

Home

•Within our CenterWell Home Health fee-for-service business, 1Q25 same store admissions grew approximately 1% year over year

oJanuary admission growth was pressured due to MA plan change activity for certain patients during the recently completed MA Annual Election Period (AEP). Admission activity ramped significantly throughout the quarter such that admission growth was in line with expectations as we exited the first quarter

•We continue to anticipate a ‘mid to high’ single digit increase in home health admissions for FY 2025

•OneHome expanded the percentage of members in some form of value-based home health model by 12% in 1Q25, as compared to December 31, 2024, and anticipates 15% expansion for FY 2025

•Our comprehensive initiative to drive productivity and efficiency within our home operating model to offset reimbursement pressure is progressing as anticipated and driving the intended results

Pharmacy

•Pharmacy results in the first quarter slightly exceeded expectations due to favorable drug mix

•We were pleased to recently be selected as the fulfillment pharmacy for NovoCare® Pharmacy’s weight loss medication for cash pay customers, consistent with our focus on expanding agnostic activity

oThis activity was contemplated in our original FY 2025 guidance issued on February 11, 2025

•We expect second quarter earnings to be approximately 35% of expected full year 2025 Adjusted earnings

•Second quarter Insurance segment benefit ratio expected to be approximately 90%

•Based off historical precedent, we continue to assume the Doc Fix will occur for 2025 either as part of the reconciliation exercise or the government funding bill

•As previously shared, we will remain prudent in our near-term capital deployment approach as we fully assess our Stars mitigation plans and until we finalize our 2026 MA pricing strategy

oAs a result, our current 2025 outlook does not contemplate share repurchase activity

oWe will re-evaluate our capital deployment plans throughout the year, taking a balanced approach to evaluating capital investments and returns

•We raised $1.5 billion in the debt markets during the first quarter, which covers our maturities through the end of 2026

oDebt to capitalization as of March 31, 2025 is 42.8% and we continue to target a debt to capitalization ratio of approximately 40% over the long term

•Accelerating our efforts to increase the efficiency of our balance sheet and fortify our foundation

oWe believe there is substantial opportunity to continue to increase the efficiency of our balance sheet and free up cash which will enhance operational performance and drive increased shareholder value over the long term

•Humana had a solid start to 2025 and we were pleased to affirm our full year guidance

•Looking ahead, we remain committed to returning to industry leading Stars performance and achieving individual MA pretax margin of ‘at least 3%’

o2025 represents a critical step on this margin expansion journey

oWe reset our MA pricing and membership to improve underlying margins and are investing to improve member outcomes and support operational excellence, positioning the company for long-term success

•Further, we are advancing our CenterWell and Medicaid strategies which are expected to drive increased earnings contribution over the mid and longer term as they mature through their respective J curves

•We have conviction that the strong core fundamentals and growth outlook for MA and value-based care remain intact and that Humana’s platform, unique focus on MA, and expanding CenterWell and Medicaid capabilities will allow us to compete effective, drive better outcomes for our members and patients, and deliver compelling shareholder value over the long term

•We look forward to further discussing our operations and outlook at our 2025 Investor Conference on Monday, June 16, 2025

Jim Rechtin, President and Chief Executive Officer

Celeste Mellet, Chief Financial Officer

    

1 Centers for Medicare & Medicaid Services, Monthly Contract and Enrollment Summary Report, December 2024