Humana Inc.’s 2010 third-quarter net income climbed 30 percent, largely due to a jump in Medicare Advantage enrollment.
Humana’s profit was $393.2 million from July through September, 2010. Humana’s total revenue for the third quarter rose 9% to $8.42 billion.
Humana’s Medicare Advantage enrollment climbed 17 percent in the third quarter to more than 1.7 million people. Humana is the second largest provider of Medicare Advantage plans behind UnitedHealth Group.
Medicare Advantage plans are private versions of Medicare. The plans provide health and drug coverage for Medicare beneficiaries and are paid billions of dollars each year by Medicare.
UnitedHealth Group pulled in $8.8 billion in the third quarter of 2010, an increase of 11%year-over-year. United’s Medicare business increased by 615,000 people from the third quarter of 2009.
United’s Medicare Advantage business grew 16% year-over-year. United’s Medicare Supplement business added 90,000 new customers year-to-year, including 25,000 people in the third quarter of 2010.
As of September 30, 2010, 4.5 million people participated in United’s stand-alone Part D prescription drug plans, an increase of 235,000 people over the last 12 months.
Stock analysts, insurance agents, and seniors have been wondering what’s going to happen to Medicare Advantage as a result of payment cuts to insurance companies that are mandated under the 2010 health care reform law. The CEOs of United and Humana have told stock analysts that their companies will be staying in the Medicare business because it is a lucrative and growing market. These 2010 third quarter numbers are proof that the Medicare market is very important to and lucrative for Humana, United, and many other insurance companies.