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Humana Turning Around But On A Bumpy Road

Humana reported Q4 2025 results today. While the Medicare Advantage (MA) insurer is making inroads, the road remains bumpy. During the fourth quarter, Humana’s net loss grew 14.9% to $796 million. Revenue rose 11.3% to $32.5 billion. For the full year, net income declined 1.6% to $1.2 billion and revenue increased 10.1% to $129.7 billion. Humana reported an medical loss ratio (MLR) of 93% in the fourth quarter and 90.2% in 2025.

Humana ended 2025 with 5.8 million MA members, a 6.3% decline since 2024. It expects enrollment to be 25% higher this year. This is in contrast to most of the other large national plans. Humana says earnings from individual MA plans will dip just below breakeven this year. Humana stock tumbled because investors fear benefits are too high for 2026, driving enrollment. This could impact margins in 2026, which investors see as a lack of operational controls necessary to meet expectations.

About 45% of Humana’s renewing MA members and 30% of its new enrollees chose plans that will not earn Star Ratings program quality bonuses. The cataclysmic drop in Star ratings has cost Humana $3.5 billion in 2026.

Humana CEO Jim Rechtin sounded conciliatory on the flat rates expected in 2027. He acknowledged the fiscal pressures on Medicare but that rates will be inadequate. He said Humana would adapt if the rate remained flat after lobbying.

Additional articles: https://www.modernhealthcare.com/insurance/mh-humana-medicare-advantage-enrollment-2026/ and https://www.beckerspayer.com/financial/humana-posts-796m-loss-in-q4/ and https://www.modernhealthcare.com/insurance/mh-humana-earnings-medicare-advantage/

(Some articles may require a subscription.)

#medicareadvantage #humana #margins

https://www.fiercehealthcare.com/payers/humana-posts-796m-loss-q4-elevated-medicare-advantage-costs-continue

Unlikely Pair Attacking Vertical Integration

An unlikely pair of senators, Elizabeth Warren, D-MA, and Josh Hawley, R-MO, have teamed up to pass the “Break Up Medicine Act.” The bill would seek to break up major vertically integrated healthcare behemoths due to the cozy relationships companies within the master entity have with each other. The bill proposes prohibiting parent companies from owning a medical provider or management services organization and a PBM or insurer. It also proposes prohibiting parent companies of prescription drug or medical device wholesalers from owning a medical provider or management services organization.

#healthplans #verticalintegration

https://thehill.com/policy/healthcare/5732189-break-up-big-medicine-act

Seismic Changes To ACA and Exchanges Proposed

Building on changes in the One Big Beautiful Bill Act (OBBBA) and other regulatory changes in 2025, the Trump administration’s 2027 Affordable Care Act (ACA) and Exchange rule aims to make additional seismic changes in healthcare.

Among the major changes include:

• Eliminating a Biden administration rule that limited insurers to two non-standard plan designs per metal level on the Exchanges. 
• Eliminate requirements that plans offer standardized options on the Exchanges, with the option to continue current standardized options.
• Changing the permissible cost-sharing parameters for Bronze plans and to update cost-sharing requirements for catastrophic plans, beginning in PY 2027. These proposals would improve consumers’ access to affordable healthcare coverage and provide consumers the flexibility to tailor their coverage to their needs. 
• Allowing insurers to offer catastrophic coverage in one-year terms or in longer terms of up to 10 years.
• Allowing multi-year catastrophic plans to be permitted to utilize value-based insurance designs to cover preventive services over and above those that currently must be covered under certain recommendations and guidelines (before an enrollee satisfies a deductible or hits an out-of-pocket maximum).
• Allowing more people over 30 to choose a catastrophic plan if they want to.
• Expanding affordable options by allowing lower deductibles but higher out-of-pocket maximums.
• Allowing certain innovative, non-network plans to obtain qualified health plan status if they can demonstrate a broad enough slate of provider options.
• Tightening citizenship limits and eligibility verification.
• Proposing stronger eligibility and income checks alongside stronger enforcement policies to protect against improper enrollments and unauthorized plan changes.
• Instituting new legal requirements around eligibility for tax credits and other assistance for immigrants as well as suggesting that states’ improper payments measurement programs evaluate how state-based Exchanges are handling premium tax credit payments.
• Implementing stronger standards for brokers and agents to deter fraud and misleading marketing.
• Outlining prohibited marketing practices, such as offering cash equivalents to prompt enrollment, falsely claiming no premiums and enrollment timelines and deadlines.
• Allowing federally facilitated Exchange states to carry out their own provider access reviews and granting state-based Exchanges more discretion with network adequacy.
• Shifting 2027 HHS risk adjustment models and harnessing improved HHS-RADV error estimation methodology.
• Easing the transition to a state-based Exchange.
• Permitting state-based Exchanges to use a “private sector-based approach” by relying on web brokers to manage consumer-facing websites.
• Preventing adult routine dental work to be considered an essential health benefit.
• Establishing stricter parameters around cost defrayal of state-mandated benefits.
• Maintaining the prohibition on the 150% federal poverty line special enrollment period.

Proponents argue the changes are needed to reduce costs and provide more affordable options. Critics argue the changes will simply erode the Exchanges financial position and increase risk.

Additional articles: https://www.fiercehealthcare.com/regulatory/cms-plans-roll-back-limits-non-standard-aca-plan-options and https://www.beckerspayer.com/payer/aca/cms-proposes-aca-implementation-rule/ and https://www.cms.gov/newsroom/press-releases/cms-proposes-regulations-lower-health-care-costs-expand-consumer-choice-protect-taxpayers and https://www.cms.gov/newsroom/fact-sheets/hhs-notice-benefit-payment-parameters-2027-proposed-rule

#exchanges #healthcare #coverage #trump #cms #regulations

https://www.modernhealthcare.com/politics-regulation/mh-aca-exchange-rule-2027-standardized-coverage

Centene Reports Financial Results

Centene Corporation posted a $1.1 billion loss in Q4 2025 and $6.7 billion loss for 2025 as it sees elevated costs overall and shrinking membership in Medicaid. It had $3 billion in profit in 2024. Its medical loss ratio was 94.3% in Q4, up from 89.6% a year ago. Adversity is increasing.

While it did post a loss in Q4, results still surpassed Wall Street analysts’ predictions. Centene issued a higher earnings outlook for 2026 than analysts expected as well.

As with Molina, which reported negative results for 2025 and financial expectations in 2026 that are half of analyst forecasts, Centene said states’ Medicaid payment rates haven’t kept pace with costs. Acuity is also rising in the Exchanges.

Both Centene and Molina stock dropped.

Additional articles: https://www.modernhealthcare.com/insurance/mh-molina-medicaid-acquisitions-medicare-advantage/ and https://www.modernhealthcare.com/insurance/mh-centene-earnings-medicare-medicaid/ and https://www.healthcaredive.com/news/centene-loss-q4-2025-2026-outlook-cnc/811564/ and https://www.beckerspayer.com/financial/centene-posts-6-7b-loss-in-2025/

(Some articles may require a subscription.)

#healthplans #margins #centene #molina #medicaid #exchanges

https://www.fiercehealthcare.com/payers/centene-reports-11b-loss-q4-elevated-medical-costs-continue-strain-finances

TrumpRx Unveiled; Novo Nordisk Reports Bad 2026 Guidance

TrumpRx was unveiled Thursday. The president negotiated deals with 16 of the 17 largest brand drug makers and part of the arrangement includes steep discounts on TrumpRx for self-pay Americans. The initial launch includes discounted products from AstraZeneca, Eli Lilly, EMD Serono, Novo Nordisk and Pfizer. Additional manufacturers that have signed agreements will have products added to the platform over time. Right now, 43 prescription drugs treating various different conditions at varying discounts are on the website. Medications for asthma, infertility and obesity are among those available. The savings range between 33 and 93 percent off the list price of the drugs.

Trump has been driving other changes as well, including deploying models for most-favored-nation (MFN) pricing in Medicaid and Medicare. The deals he struck already gained MFN in Medicaid and such pricing on new drugs that come to market.

Some criticize the initiative because it will not benefit some 85% of the population with prescription drug insurance coverage. But the president deserves credit for making huge headway on cash pay, the Medicaid MFN changes, the MFN models, and deeper discounts in the Medicare drug price negotiations. More needs to be done, especially for commercial insurance, but Trump has delivered real reforms here.

In other news, Danish firm Novo Nordisk, maker of GLP-1 weight-loss drugs Ozempic and Wegovy, reported full-year 2025 results of 10% sales growth and 6% operating margin growth. However, it said 2026 sales and operating profit growth would be negative 5% to 13%. It blamed competition, patent expiration and lower U.S. prices. Meanwhile, U.S. firm Eli Lilly, maker of Mounjaro and Zepbound reported good news and positive expectations for 2026. Novo is also suing Hims and Hers for readying to market a “knock off” pill with Wegovy ingredients.

It is hard to get too concerned about Novo. Its stunning success earlier drove its profits as well as much of the small Danish nation’s GDP growth for several years. And as Trump often notes, foreign drug firms like Novo have earned profit on the backs of Americans. Some 75% of all profits come from America for brand drug makers.

Further, after a court stayed implementation of a pilot program that would convert upfront discounts to retrospective rebates in the 340B program, the Department of Health and Human Services (HHS) has agreed to scrap the proposal and potentially restart the process.

Additional articles: https://www.fiercepharma.com/pharma/trumprx-governments-cash-pay-drug-purchasing-tool-primed-launch and https://thehill.com/homenews/administration/5725804-trump-launches-online-prescription-drug-platform-trumprx-what-to-know/ and https://www.modernhealthcare.com/politics-regulation/mh-hhs-340b-drug-pricing-program-rebate-model/ and https://finance.yahoo.com/news/novo-nordisk-q4-earnings-call-134858973.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAJzUe6HiQKz3okVpdso7A0yLeZAIPW1Ub2ostzrg7ZONyQ8z1KWrDGM859gWDHSx-g-178HChmqc40o8i1lMq0Z0f8O1tXErWp6qrflxRiOQ5GwC6iEyxQ2Yhd9fdz-o9EckMhY6Yljg3gA_7GDG6JdxppPhxUpCV_1324WzFyBd and https://thehill.com/policy/healthcare/5724285-white-house-trumprx-launch-most-favored-nation/

(Some articles may require a subscription.)

#drugpricing #mfn #trumprx #branddrugmakers

https://www.beckershospitalreview.com/pharmacy/trumprx-launches-with-discounts-on-40-drugs-5-takeaways

FTC Settles With Cigna’s Express Scripts

The Federal Trade Commission (FTC) and Cigna’s Express Scripts pharmacy benefits manager (PBM) reached a settlement that resolves allegations that the PBM artificially drove up prices for insulin. Cases continue against CVS Caremark and OptumRx.

Express Scripts will implement a number of reforms, including:

• It will stop listing preferred drugs at the high wholesale acquisition cost rather than lower cost versions on its standard formularies.
• It will no longer omit drugs with a low per-unit list price on formularies or give preferential treatment to those with a high list price.
• It will offer access to Trump Rx’s direct-to-consumer platform as part of its standard offerings. Costs will count toward Express Scripts members’ deductibles.
• It will establish a standard offering for plan sponsors where the out-of-pocket costs for patients are based on the net cost of a drug, rather than the list price.
• It will provide full access to its Patient Assurance Program to all individuals if insulin is on a formulary unless the plan sponsor chooses to opt out.
• It will offer a standard benefit design that allows plan sponsors to transfer off of rebates or spread pricing, and delinking drug manufacturers’ payouts from list prices in standard benefits.
• It will ensure employers do not pay higher than a drug’s net cost.
• It will pay pharmacies the cost of drugs plus a dispensing fee.
• It will reshore its group purchasing organization, Ascent, from Switzerland to the United States.
• It will increase transparency, including reporting more data on drug spending and disclosing any kickbacks to brokers that help employers choose PBMs.
• It will expand access to its patient assistance program’s insulin benefits.

The FTC expects the settlement to lower out-of-pocket costs for drugs by $7 billion over a decade.

Additional articles: https://www.fiercehealthcare.com/regulatory/ftc-evernorth-near-settlement-case-over-insulin-prices and https://www.healthcaredive.com/news/express-scripts-ftc-reach-settlement-insulin-lawsuit/811369/ and https://www.beckerspayer.com/legal/ftc-deal-over-insulin-prices-forces-cignas-express-scripts-to-overhaul-policies/

(Some articles may require a subscription.)

#pbms #drugpricing #employers

https://www.modernhealthcare.com/insurance/mh-cigna-express-scripts-ftc-pbm-lawsuit

Partial Shutdown Over

The House voted 217-214 to approve a final spending package for FFY 2026 — 21 Republicans defected from and 21 Democrats supported the bipartisan measure. President Trump has already signed the bill. A number of key healthcare reforms are included. I reported on a list of them in the Newsfeed on January 30.

Among the big items are a set of pharmacy benefit manager (PBM) reforms, including extensive reporting, transparency, and government oversight as well as requirements to pass rebates earned from drug makers to health plans, employers, and patients. PBMs will now have to charge a set fee for services.

The bill requires the groups to report detailed data on drug pricing, rebates, pharmacy reimbursement, and payments retained by PBMs and their affiliates and authorizes audits and enforcement/recoupment actions.

In addition, telehealth was extended for two years and acute hospital-at-home by five years.

Additional articles: https://www.modernhealthcare.com/politics-regulation/mh-congress-government-funding-bill-pbm-telehealth/ and https://www.beckershospitalreview.com/hospital-management-administration/government-reopens-after-partial-shutdown-5-notes/ and https://thehill.com/homenews/house/5721189-democrats-republicans-end-shutdown/?tbref=hp

(Some articles may require a subscription.)

#governmentshutdown #congress #trump #healthcare #coverage #medicare #pbms #drugpricing

https://www.fiercehealthcare.com/providers/partial-government-shutdown-looms-threatening-stall-health-funding-package-telehealth

Government Funding Bill Still Not Passed; Due Up Tuesday in House

With Democrats off the Senate funding package to end a partial government shutdown, Speaker Mike Johnson, R-LA, is still expressing optimism about the House approving a funding package Tuesday. The Rules Committee is now meeting to pass a rule, which then clears the way to have a party-line vote on the Senate package. But with the ability to lose but one vote given a slim majority, Johnson’s optimism may be a bit too, well, optimistic. However, Johnson says he is not asking President Donald Trump to call those Republican holdouts to get the deal over the finish line.

This package and an earlier one funds all but the Homeland Security department through September 30. That is funded for two weeks, giving time for Democrats and Republicans to discuss concerns over ICE and Homeland Security conduct.

Additional article: https://thehill.com/homenews/house/5719277-johnson-trump-gop-holdouts-funding/?tbref=hp

#governmentshutdown #congress #trump

https://thehill.com/homenews/house/5718734-what-to-know-about-the-partial-government-shutdown/?tbref=hp

Partial Government Shutdown Will Occur Despite Deal But Could Have Limited Impact — Hopefully!

The Senate passed a compromise provision to fund the government for all agencies yet to be funded and two weeks for the Department of Homeland Security. That will give time for parties to negotiate over some constraints on immigration officers. The Senate passed legislation Friday on a strong bipartisan vote.

The government technically shuts down at midnight tonight, but the House will be back on Monday to vote on the amended package. House Speaker Mike Johnson, R-LA, wants to suspend the rules to take up the bill to get funding moving quickly Monday. That requires a two-thirds vote, requiring about 70 Democrats to sign on in support. In part, Johnson wants to do this because he could have defectors among conservatives and he is challenging Democrats politically to oppose the measure. If he cannot suspned the rules, he would need to pass a rule through the Rules Committee and seek to pass the bill on a party-line vote. That could be tough in the committee and he has just a one vote cushion now in the vote count in the full House.

If all goes well, the mini-shutdown this weekend will end quickly. But that is by no means assured. Too few Democrats could fail to support the procedual vote and the measure. They are far more progressive in orientation than Senate Democrats. And conservatives could fail to support the bill as well.

Healthcare provisions in the legislation include:

• Enacting some pharmacy benefits manager (PBM reforms).
• Extending Medicare’s telehealth rules for two years and hospital-at-home rules for five years.
• Funding $4.6 billion for community health centers.
• Delaying Medicaid disproportionate share hospital payment reductions until 2029.
• Extending add-on payments for low-volume and Medicare-dependent hospitals, Medicare geographic payment adjustments for doctors, and ambulance payments through the end of the year.
• Restoring a 3.1% bonus for physicians participating in Medicare alternative payment models.

Additional articles: https://www.modernhealthcare.com/politics-regulation/mh-senate-funding-bill-telehealth-pbms/ and https://thehill.com/homenews/house/5715812-mike-johnson-fast-track-funding-shutdown/

(Some articles may require a subscription.)

#governmentshutdown #trump #democrats #healthcare

https://thehill.com/homenews/senate/5715914-senate-government-funding-package

Exchange Enrollment Down

About 23M have enrolled in Exchange coverage as open enrollment has all but closed out. That’s down about 5% from 2025 but more than the 21.3M in 2024. Interestingly, the reduction is not what many thought it would be after the expiration of the enhanced premium subsidies.

About 3.4 million are new enrollees, while 19.6 million are returning. About 15.8 million people enrolled on the federal Healthcare.gov platform, while 7.2 million enrolled on the state-based Exchanges.

Some states that stepped in with subsidies of their own saw strong growth, as did others who did not – such as Texas. Nine states had enrollment growth, while 41 saw declines.

For the 30 HealthCare.gov states, the data is through Jan. 15. For the 20 state-based exchanges plus D.C., the data is through Jan. 10. There are a few states that extended open enrollment and thus the enrollment numbers could rise. The big unknown is will rolls fall as people are required to make payments and do not do so after a grace period. Thus, 2026 could see more disenrollments.

In other news, talks to extend the enhanced subsidies in some form have ended and the GOP is preparing a last best offer to the bipartisan group. Discussions revolved around a possible two-year extension of the subsidies with subsidy income limits, minimum premiums, and expanded use of health savings accounts (HSAs).

Additional articles: https://www.healthcaredive.com/news/affordable-care-act-enrollment-2026-cms-snapshot-23-million/810790/ and https://www.beckerspayer.com/payer/aca/gop-senators-prep-best-and-final-offer-on-aca-subsidy-extension/ and https://thehill.com/policy/healthcare/5712648-obamacare-enrollment-drops-subisides-expiration/?tbref=hp and https://www.kff.org/quick-take/aca-signups-are-down-but-still-an-incomplete-picture/ and https://www.beckerspayer.com/payer/aca/aca-enrollment-falls-to-23-million-for-2026/

#healthcare #coverage #exchanges

https://www.fiercehealthcare.com/regulatory/about-23m-have-signed-aca-coverage-so-far-cms