Humana’s Bruce Broussard: Consumer Demand for Home-Based Care Models Will Continue to Increase

Humana’s (NYSE: HUM) long-standing home- and community-based focus served the insurer well in Q2 2020 — a quarter dominated by the COVID-19 emergency. The coronavirus pushed more senior care into the home, boosting business for Louisville, Kentucky-based health insurance giant.

As a result, the insurer doubled down on home-based care initiatives in Q2 2020 and will continue to do so going forward.

“We believe consumer demand for high-quality home-based care models will continue to increase,” Humana CEO and President Bruce Broussard said on the company’s Wednesday earnings call. “And COVID has reinforced this belief as we see increased awareness and interest in home-based care models by consumers.”


Humana has long been bullish on home- and community-based care. In 2017, the company, along with two PE firms, announced the acquisition of Kindred at Home, the largest home health provider in the country.

The insurer ramped up its home-based care efforts even further amid the pandemic, announcing strategic partnerships with the in-home primary care company Heal and the home-based acute medical care provider DispatchHealth

“Heal will serve as our preferred home-based primary care model, which is inherently more capital efficient and scalable, allowing Humana to offer high-quality, value-based primary care to more members than a clinic-based strategy,” Broussard said on the call. “The ability to deliver emergency room and hospital-level care in the home through partners like DispatchHealth is highly complementary and allows patients to recover in the safety and comfort of their home. [It also] reduces caregiver burden and avoids the risk of secondary infections and further health declines often experienced at the result of inpatient hospital stay.”


Additionally, Humana has continued to invest in Kindred at Home, most recently by working on developing new clinical models and operational enhancements for the service line. Broussard did not elaborate on what those look like.

Humana also saw the fruits of its home-based care efforts partly in the form of increased Medicare Advantage enrollment in Q2.

Last quarter, Humana’s individual MA plan enrollment was up 11% year-over-year, growing to 3.8 million in Q2. That’s especially impressive considering the fact that Humana recorded its highest individual MA growth rate in a decade in 2019.

“Medicare Advantage plans were some of the first organizations to proactively identify and implement policy and benefit changes at the outset of the pandemic,” Broussard said. “These actions addressed testing and treatment costs associated with the coronavirus, identified and tackled social determinants needs such as food insecurity, and ensured continuity of care for our members.”

One reason for MA’s success amid the coronavirus is that supplemental benefits allow plans to offer members services such as home-based care, food delivery and more, lessening the risk of seniors’ virus transmission while also addressing some of the effects of loneliness and isolation.

Bolstered by the COVID-19 emergency, MA’s popularity at Humana is only expected to grow more in the months to come.

The insurer raised its expected MA growth projections as a result of the strong performance it’s posted so far this year. Humana increased its individual MA growth range for 2020 from 300,000 to 350,000 new members to 330,000 to 360,000 by the end of the year.

For the quarter ended June 30, Humana saw its profits soar to $1.8 billion, or $13.75 per share. That’s double the $940 million in profit the company posted a year earlier in Q2 2019, with a nationwide delay of elective procedures largely to thank for the spike.

Humana’s Q2 revenues totaled $19.1 billion, up from $16.2 billion year-over-year.

MA competition, synergies

When asked about competition in the MA market, Broussard acknowledged that a number of smaller plans grew substantially last year, orienting recruitment around member experience.

“They’re always a concern to us, but we continue to believe our brand is strong in the markets that we compete with them,” he said. “Our value proposition is strong both with our customers and with our providers.”

Humana has technology on its side, as well as potentially Walmart, which recently announced it would get in the MA game.

“They’re not really getting into the MA business; they’re getting into the MA distribution business, and they have been in that business for a long period of time,” Broussard said. “So they would distribute Humana products but also competitor products. … We frankly look at it as a great complement to us, as they can continue to be a distributor for us.”

Humana’s stock price was $403.91 at the end of the day Wednesday.

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