Humana Q3 2026 Earnings: Medicare Advantage Growth and the Insurance Segment Loss

Farzin Espahani

Strategic Advisor, Insurance Growth, Medicare Distribution, and Compliance

Published November 6, 2026

Humana ended the third quarter with a much larger Medicare Advantage membership base than a year earlier. Its latest results show how difficult it remains to turn that growth into sustainable insurance profits.

On November 6, 2026, Humana reported third-quarter (Q3) revenue of $41.16 billion, up 26.1% year over year. Medicare Advantage (MA) membership reached 7.19 million, up 23.7%. Its Insurance segment recorded a $303 million operating loss, compared with a $251 million operating profit a year earlier. [1]

In our earlier analysis of Humana's second-quarter results, we separated enrollment growth from financial performance. Q3 reinforces that distinction. Humana has built a larger customer base and reduced its administrative cost ratio. The financial benefit still depends on retaining members, improving the performance of new enrollment cohorts, and restoring quality-bonus revenue. [5]

The quarter exceeded management's forecast, while earnings remained below last year.

Four years of third-quarter membership

The following tables compare Q3 2023 through Q3 2026. Membership is measured at September 30; revenue and earnings cover the three months ended September 30. Financial results follow Generally Accepted Accounting Principles (GAAP) unless labeled adjusted.

Special Needs Plans (SNPs) are part of Medicare Advantage. Humana separately identifies Dual Eligible Special Needs Plan (D-SNP) enrollment, which covers qualifying beneficiaries with Medicare and Medicaid. Its earnings releases do not provide a separate total covering every SNP type. The D-SNP row below must therefore be read as a subset of MA, rather than an additional membership category or a complete SNP total. [1-4]

Humana's reported medical membership includes stand-alone Prescription Drug Plan (PDP) enrollment and military services. Specialty membership includes products such as dental and vision. Changes in those businesses affect the total independently of MA growth.

There is an additional comparability issue in 2026. Approximately 350,000 beneficiaries appear in both group MA and stand-alone PDP enrollment because their medical and drug coverage were separated. Some members in integrated dual-eligible plans also appear in both individual MA and state-based membership. Adding the categories does not establish how many distinct people Humana serves. [1]

Revenue grew across Medicare products

Dollar amounts below are in millions. MA premium revenue is the calculated sum of individual and group MA premiums. Product premiums are components of revenue and should not be added to consolidated revenue.

The company receives revenue for SNP members within its broader reported businesses. Estimating SNP revenue by multiplying D-SNP enrollment by average MA revenue would overlook differences in member risk, payment rates, and coverage arrangements. These disclosures do not support a reliable standalone SNP revenue figure.

The 2026 group MA and PDP revenue comparison is also affected by the separation of medical and drug coverage. Humana assigns the affected members' drug revenue to PDP and their medical revenue to group MA. That limits what can be inferred from changes in either product's revenue per member. [1]

How growth changed each year

These year-over-year changes are calculated from the reported figures above. Q3 2023 is the baseline for the four-year comparison.

The enrollment path matters. MA membership increased in 2024, declined in 2025, and rebounded sharply in 2026. D-SNP enrollment followed the same pattern. Although D-SNP membership increased 25.1% from Q3 2025, it was only 2.0% above Q3 2024. The latest growth largely restored the previous year's decline.

Medicare Supplement followed a steadier path. Membership increased in each comparison year and was 90.7% above Q3 2023. Its premium revenue reached $363 million, although the earnings releases do not establish whether that growth is profitable on a standalone basis.

Benefit costs absorbed the administrative efficiency gains

Humana calls its medical-cost measure the benefit ratio: benefits expense divided by premium revenue. The Insurance segment ratio covers multiple insurance businesses. It cannot be presented as an MA-only, Medicare Supplement-only, or SNP-only medical-cost ratio.

The Insurance benefit ratio increased from 91.1% to 93.7%. For every $100 of premium revenue, benefits consumed $2.60 more than in the same quarter last year. The segment's operating cost ratio improved from 9.1% to 7.7%, a reduction of 1.4 percentage points.

Administrative efficiency helped, but it was insufficient to preserve the segment's profit. Insurance revenue increased 25.3%, while operating income deteriorated by $554 million. The calculated operating margin moved from 0.80% to negative 0.78%.

The two cost ratios use different revenue denominators, and the operating cost ratio excludes depreciation and amortization. Subtracting both from 100% would therefore produce an inaccurate operating margin.

The four-year direction is unfavorable. Insurance operating profit declined from $722 million in Q3 2023 to a loss in Q3 2026, despite substantial revenue growth. Business mix and program changes affect comparability, but the reported results still show that higher revenue has not protected quarterly profitability.

Why the benefit ratio increased

Humana identifies three main pressures: the 2026 Star Ratings revenue headwind, a larger share of new individual MA members who carry higher benefit ratios than retained members, and less favorable development of claims estimates from prior periods. [1]

These affect the economics in different ways. Lower quality-bonus revenue reduces the premium dollars available to cover care. New-member growth changes the population being insured. Less favorable prior-period development means earlier claims estimates provide less help to current earnings.

The aggregate ratio cannot tell us how much of the deterioration reflects each factor. It also does not establish that members are receiving unnecessary care or that new enrollment is permanently unprofitable. For a payer, the next step is to separate new and retained members by enrollment year, product, and market. Finance and clinical teams need to see whether care access, utilization, supported risk documentation, and medical spending improve as members establish relationships with providers.

Humana performed better than expected

Management had expected an adjusted loss of approximately $1.00 per share. The reported adjusted loss was $0.70. The Insurance benefit ratio of 93.7% was also below its expectation of slightly above 94%. Management said medical and pharmacy trends were in line with or better than its high-single-digit expectations across new and existing members. [6]

Humana raised its full-year adjusted EPS guidance from at least $9.00 to at least $9.50. That is progress against its current plan. Q3 adjusted EPS was still below the $3.24 earned a year earlier. [1]

Reported GAAP EPS of $1.33 and adjusted EPS of negative $0.70 also measure different results. The reconciliation removes, among other items, a $358 million pretax valuation benefit associated with minority investments. The positive GAAP result should not be treated as evidence that insurance operations were profitable. [1]

Star Ratings recovery improves the outlook for 2028

One development has changed since the Q2 article. Humana announced that 95% of its MA members were in plans rated four stars or higher in the 2027 Star Ratings, with 42% in 4.5-star plans. [7]

Management links these ratings to bonus year 2028 and continues to target an individual MA pretax margin of at least 3% in 2028. This is a forward-looking objective, rather than a margin achieved in the current quarter. The timing separates the current earnings pressure from the potential recovery. Better ratings support future payment economics. Humana still needs to manage care costs, retain members, and sustain the service and quality performance behind those ratings. [6]

Care delivery needs to keep pace with enrollment

Humana reported 4.12 million individual MA members in value-based arrangements, up from 3.55 million a year earlier. That increase was slower than overall individual MA growth, so the share in those arrangements declined from 68% to 64%. The share in shared-risk arrangements declined from 37% to 31%. [1]

Those figures do not prove that care deteriorated. They show that enrollment expanded faster than participation in Humana's reported value-based arrangements. Provider capacity, attribution, and member engagement should be examined alongside sales growth.

CenterWell shows a related financial challenge. Q3 revenue increased 21.7% to $7.16 billion, while operating income declined 20.3% to $243 million. These segment revenues include intersegment business and should not be added directly to consolidated revenue. [1]

Management identified higher primary-care costs concentrated among certain patients in one geography, as well as pressure from the risk-adjustment model transition. It expects contracting and other changes to help in 2027. Provider leaders need visibility into the contracts and patient groups producing that pressure. Expanding a clinic network or adding attributed patients does not by itself establish that reimbursement covers the care obligations assumed. [6]

What payer and provider leaders should take from the report

Three actions follow from these results.

1. Connect enrollment reporting to cohort performance. Track new and retained members separately. Pair retention and medical spending with appointment access, care engagement, and documentation quality. Accurate risk adjustment should reflect supported clinical information and appropriate care.

2. Test whether provider capacity can support the growth. Review primary-care assignment, appointment availability, referral completion, and follow-up after hospital discharge. Measure completed care, rather than counting an outreach attempt as a resolved need.

3. Review margins alongside member and provider friction. Assess product and market profitability together with authorization turnaround, appeal outcomes, claims payment accuracy, and member complaints. A cost reduction that creates delayed care or repeated administrative work may move the burden elsewhere without reducing the underlying problem.

Humana's next few quarters should establish whether its larger 2026 membership base can be retained and served at a sustainable cost. We would look for improving cohort economics, adequate provider access, sustained quality performance, and a return to Insurance segment profitability before concluding that the enrollment expansion has delivered its intended financial value.