Humana said Wednesday that it recorded a premium deficiency reserve totaling $176 million--or $0.74 per share--for the fourth quarter to cover anticipated losses on its individual commercial policies. The insurer had said in a Securities and Exchange Commission filing in January that it expected to book losses, but did not specify how much. Humana reported earnings of $0.67 per share for the quarter, down from $0.94 per share for Q4 in 2014. Its earnings per share for 2015, though, was $8.44, up from $7.36 in 2014.
"Humana faced challenges across a number of fronts in 2015," Brian A. Kane, senior vice president and chief financial officer, said in the earnings report. "However, the strength of our clinical model together with strong administrative cost discipline helped us not only manage these challenges in 2015, but together with targeted pricing and other operational actions, helped position us for meaningful margin improvement in our core individual Medicare Advantage business for 2016 as well as attractive growth in both revenues and EPS in 2017 and beyond." Earnings report