CVS and UnitedHealth lost ground on Medicare ratings. Who gained?
Medicare Advantage plans for seniors faced rising medical costs in 2027, prompting a yearly report card from the government. Humana (NYSE:HUM) experienced a significant surge in its flagship plan, reaching four stars, with J.P. Morgan projecting a 95% share of members in four-star-plus plans by 2027. This shift would result in Humana collecting $4.8 billion in federal quality bonus payments in 2028, according to Evercore ISI.
Despite cost pressures, Humana's insurance benefit ratio grew to 91.2% in the second quarter, and the company plans to exit certain Medicare Advantage plans in 2027. Humana's substantial membership increase of 23.8% and strong performance over the past year, up 47.8% compared to UnitedHealth's 22.4% growth, highlight its competitive position in the Medicare Advantage market.
Analysts remain divided on Humana's earnings, but the stock has shown a positive trend, up 15.3% since ProPicks AI added it to the list in August.
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