Humana has reported a Q4 net loss and guided to a sharp decline in 2026 EPS as it prepares for a Medicare Advantage (MA) Star Ratings headwind.
For the quarter ended Dec. 31, Humana posted a GAAP net loss of $6.61 per share, compared with a loss of $5.76 per share a year earlier. On an adjusted basis, the company reported a Q4 loss of $3.96 per share, compared with an adjusted loss of $2.16 per share a year earlier.
For full-year 2025, Humana reported GAAP EPS of $9.84, broadly in line with $9.98 a year earlier.
The company reported a GAAP benefit ratio of 93.1% for its insurance segment in Q4. For the full year, the insurance segment GAAP benefit ratio was 90.4%, slightly better than the top end of its guidance range of 90.1% to 90.5%.
Reported results continued to reflect adjustments for amortization of identifiable intangibles, valuation changes on nonconsolidating minority interest
Star Ratings hit drives 2026 EPS reset
Looking ahead, Humana introduced full-year 2026 GAAP EPS guidance of "at least $8.89" and adjusted EPS guidance of "at least $9.00."
The company said the projected decline “results from the Star Ratings headwind for Bonus Year 2026, net of mitigation,” referring to the impact of lower MA Star Ratings on quality bonus payments and related revenue. Unlike 2025, the 2026 adjusted guidance does not include large nonrecurring items such as valuation changes, restructuring initiatives, or impairments.
MA-heavy mix leaves Humana more exposed than diversified rivals
Against a peer set that includes UnitedHealth Group, CVS Health (Aetna), Elevance Health, Cigna Group, and Centene, Humana remains one of the most MA‑concentrated players. Its earnings rely heavily on individual Medicare Advantage and senior-focused care, with smaller contributions from commercial group and pharmacy benefits than some rivals.
That business mix leaves Humana more sensitive to MA-specific shocks, such as Star Ratings changes, than diversified carriers that can lean on commercial, Medicaid, PBM, or health services earnings to offset pressure. As a result, the 2026 Star Ratings impact shows up more starkly in Humana’s EPS outlook.
Even so, Humana is guiding to approximately 25% individual MA membership growth in 2026 versus 2025, driven by new sales and improved retention under its “customer-led benefit strategy” and revised service model. The strong growth target suggests Humana is still leaning into MA scale despite near-term margin pressure.
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CenterWell and Medicaid expansion add some diversification
Humana also pointed to continued expansion in its care delivery and Medicaid platforms. In CenterWell Senior Primary Care, the company reported patient growth of 100,600 in 2025, an increase of more than 25%, including roughly 32,000 patients from the acquisition of The Villages Health.
Its Medicaid footprint now spans 13 states, with Georgia and Texas expected to launch in 2027. While these businesses provide additional growth avenues, they are not yet large enough to fully offset volatility in the MA franchise.
“We were pleased with our solid financial performance and operational progress in 2025,” said Humana president and CEO Jim Rechtin. “We continue to feel good about our consumer-focused strategy and our individual Medicare Advantage membership growth in 2026, which will allow us to build for the future with even better outcomes and experiences.”
