Louisville-based health insurer Humana plans to stop providing employer-sponsored coverage as it focuses on bigger parts of its business, like Medicare Advantage.
The insurer said Thursday it will leave the employer-sponsored business over the next 18 to 24 months. That includes coverage provided through private companies and for federal government employees.
Employer-sponsored health insurance is one of the most common ways for Americans to get coverage, but it amounts to a small part of Humana’s enrollment. That is centered largely on Medicare Advantage, the privately run version of the federal government’s Medicare program for people age 65 and older.
Humana also will continue to provide coverage to nearly 6 million military service members and their families.
Humana said it in a statement it made its decision after realizing that employer-sponsored business “was no longer positioned to sustainably meet the needs of commercial members over the long term or support the company’s long-term strategic plans.”
Enrollment growth in employer-sponsored insurance has stagnated for many years for insurers, including market leaders like UnitedHealthcare and Indianapolis-based Elevance Health Inc. (formerly Anthem). Insurers have turned more to government-backed coverage like Medicare Advantage or managing state Medicaid coverage for enrollment growth.
They also have pushed deeper into managing prescription drug plans and buying care providers in order to control health care costs.
Shares of Humana climbed about $2, to $505.60 each, on Thursday.
Please enable JavaScript to view this content.
Oh, Dear Lord. What a tragic decision. Employers need more competitive health care plan options. Meanwhile, as a friend tells me, “Medicare is literally the best insurance coverage you can get. Medicare Advantage plans are the Devil.” These insurance companies are not advertising like crazy because they want to spend lots of money to pay lots of claims. Please resist the siren song of Medicare Advantage plans.
Totally agree, Patrick. Or how about traditional Medicare for all and get employers out of providing health insurance. Wouldn’t that remove a big burden to all businesses. If they want to offer perks, offer good dental plans and paid maternity leave.