Humana Lowers Profit Outlook Due to Lower Medicare Star Ratings
Health insurer Humana has cut its full-year earnings outlook for 2026 due to reduced Medicare Advantage Star Ratings, which impact the quality bonuses it receives from the federal government. The company revised its GAAP earnings target downward to a minimum of $6.52 per share, down from at least $8.36 previously, while maintaining an adjusted forecast of at least $9 per share. In Q2 2026, Humana reported net income of $694 million or $5.73 per share and revenue rose to $40.87 billion, up from the same period last year. The company's benefit ratio was in line with expectations at 91.2%. Despite these results, shares fell nearly 9% in premarket trading following the earnings revision. The decline in star ratings has reduced bonus payments for Humana and reflects broader challenges across the health insurance industry due to rising medical costs driven by increased patient demand and higher drug prices.
Tickers: $HUM