The company's strategy focuses on affordable health care combined with a positive consumer experience in growing markets, driven by an integrated care delivery model. At March 31, 2025, 67% of individual Medicare Advantage members were in value-based relationships.

Individual Medicare Advantage membership decreased by 6.0% YoY, inclusive of the decision to exit certain unprofitable plans and counties. This strategic decision impacts near-term membership but aims to improve long-term profitability.

State-based contracts and other membership increased by 27.5% YoY, reflecting additional membership related to the Oklahoma and Indiana contracts, along with the allocation of additional membership in Kentucky.

Charges of $24 million were recorded for the three months ended March 31, 2025 due to cost saving, productivity initiatives, and value acceleration from previous investments. These charges relate to asset impairments and severance charges.

The Insurance segment operating cost ratio decreased due to administrative cost efficiencies resulting from value creation initiatives and operating leverage. This demonstrates management's focus on improving operational efficiency.

The integrated care delivery model unites quality care, high member engagement, and sophisticated data analytics. This highlights management's focus on leveraging data to improve health outcomes and affordability.

The Final RADV Rule, including the lack of a FFS Adjuster, and any related regulatory, industry or company reactions, could have a material adverse effect on our results of operations, financial position, or cash flows.

Humana filed suit against the United States Department of Health and Human Services regarding the Final RADV Rule, seeking a determination that the rule violates the APA and should be set aside.

It is reasonably possible that laws and regulations, as well as other current or future legislative, judicial or regulatory changes, may have a material adverse effect on our results of operations.

Individual Medicare Advantage membership decreased due to the decision to exit certain unprofitable plans and counties, indicating a focus on profitability over sheer membership growth.

Medicare stand-alone PDP membership increased, reflecting shifting competitive dynamics. This indicates the company is adapting to changing market conditions.

State-based contracts and other membership increased significantly, suggesting the company's diversification strategy is proving effective in offsetting losses in other segments.

The Insurance segment operating cost ratio decreased due to administrative cost efficiencies resulting from the value creation initiatives. This demonstrates a focus on improving operational efficiency.

The CenterWell segment operating cost ratio decreased due to administrative cost efficiencies and more favorable operating trends in the primary care business. This indicates improved efficiency in the CenterWell segment.

Depreciation and amortization decreased primarily due to decreased capital spending. This could indicate improved efficiency in capital allocation or a slowdown in investment.

Ongoing capital expenditures primarily relate to information technology initiatives, support of services in primary care operations including medical and administrative facility improvements. This indicates continued investment in technology and infrastructure.

The company issued senior notes and used the proceeds to repay outstanding amounts from senior notes due on April 1, 2025. The remaining net proceeds will be used for general corporate purposes.

During the three months ended March 31, 2025, the company did not repurchase shares in open market transactions under the February 2024 share repurchase authorization.

The company paid dividends to stockholders of $108 million, consistent with the $109 million paid in the same quarter of the prior year.

The IRA has significantly impacted premiums and benefit designs, particularly in Medicare Part D. The company notes the changes are anticipated to reduce out-of-pocket costs for beneficiaries and impact plan liabilities accordingly.

The change in Medicare Part D seasonality due to the IRA will result in the company sharing a greater portion of the responsibility and result in prescription costs that are more level throughout the year.