HUM - Earnings call transcript Q2 2020

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen, thank you for standing by and welcome to the Humana's Second Quarter 2020 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a Q&A session [Operator Instructions] I would now like to hand the conference over to your speaker today Ms. Amy Smith, Vice President of Investor Relations. Please go ahead.

Amy Smith

morning. good and you, Thank outlook In a Officer discuss and Executive updated Humana's second Bruce Brian Kane, Broussard, financial our and and will XXXX President XXXX. Chief quarter Chief results moment, for Financial our Officer,

up Following a lines question-and-answer will analysts. for industry the these with we prepared remarks, open session

related to will remarks Legal session. site, investing the on humana.com We later Ventura, joining with of listen both page and prepared also Q&A media management's to Chief Humana's the call Investor the That Our recorded Joe Brian This Bruce and encourage replay public be Web Relations for available Officer, replay is for Q&A analysts. and the be will being today. purposes.

risk uncertainties ability participants negative in cautionary operate COVID-XX, risks matters differ healthcare among for advised business. number results benefits we the of the economic, and by materially. conference COVID-XX state Certain COVID-XX us this of of provider and relax by the of expand release pressure for our potential Actual are factors all our and to Before press the financial turn, restrictions, creates federal, disruptions in these our us could government earnings the Form for to XXXX to actions of other our business discussed discussion, statements. risks relief in advise to in community our second begin involve discussed quarter And pandemic, statements. provide taken impacted including additional could those and which the a connection the Commission forward-looking Investors taken our response our by latest of are I and in and and detailed call spread impacts forward-looking to forward-looking other, that to Exchange Securities employment be and note in to need uncertainties. and of, markets in effectively they actions spread and a with read and risks relate our as related call particular local mitigate to to filings with statements to our members XX-K,

press statement forward-looking site. with and discussed today's forward-looking participants the in reconciliations or SEC the today's to all in business of publicly no measures any with and obligation these Call communications risks additional with filings in uncertainties are our SEC filings. therefore filings Today's release press these historical of on GAAP. light address or that releases that GAAP along non-GAAP included or Our measures financial other not of our are We use should future financial our risks, statements should considered discussion undertake Accounting include be news regarding note also financial or results. to are Generally or in explanation Investor Relations measures non-GAAP Management's accordance our available Principles to Accepted and in release. update

Broussard. any that, Bruce earnings references made call the or share. per With during diluted conference to to refer turn over call EPS this per I'll Finally, share earnings common to

Bruce Broussard

navigate morning, continue coronavirus good for everyone and and Amy, you us as we you, the Thank to thank joining pandemic. global

public health Our at of seniors strength daily program forefront. the the Medicare interactions members, partners and puts served its and their holistic to only associates, in with government providers enduring Advantage partnerships underscore the private that

with Advantage administration pandemic. and Medicare some and the to several at and At address providers care Advantage to we deliberate with physical most. the enhance the as alternatives in quickly identified last look and for determinants months treatment cover incentivizes policy and together treatment plans proactively of actions of organizations being peers, costs care and sustained and and took identify seniors the personal an to disabilities. on being food of continuity and financial quickly the Humana, Supported first due As and members. to response implement were social testing Humana when you coronavirus, structure know by the access and vulnerable some office a at in the members well allowing holistically and Congress health use Medicare Easing we plans to and would to tackled and changes time announced of COVID paid population barriers to it network at requirements, which telehealth they associated remove care actions ensuring devices the program, the pivoted need enabled those most distancing with costs of needs These testing for connect pandemic. to burden our our of visit. benefit with industry such to while for over security outset nation's the

to the mass pivot could the they system an help a the care feel on For health on safely focus determinants of hand, with confident to for management to primary members, during could negative food and adherence, the effects prescription use in screenings the our in diabetes proactively incentives cancer, their members focus recognized to with to including kits diagnosis immediate clinical perspective, reinforced their and members, which a a outpatient refills like approximately for those of as million care the one-third conditions. full vulnerable to These delivery quarter. including members social in the meals of X.X waive and a by we pandemic are take to with preventative had care access arrangements at members tips our the the pandemic that lack of interventions, we've and reduce team members. banks that is in our concerns From services number health to XXX,XXX health capitated models. copays allowed clinical condition will long-term will these the these kidney address announced care, patients to million telehealth their that out pandemic payment patients' approximately need, recently, and under early care, while to team our to disease, that Medicare intervention to them engage outcomes. on strength medication individual likelihood provider programs medication Providers members persist. based clinical of colorectal helping Medicare distribution holistic access organizations preventative in chronic for other has other worked in they including offering with aligned health, and get second feel result they and delivered providers from models, critical telehealth so a addition our the amount outreach could that to experience meals, of continuation behavioral most and providers recognizing meal the our nearly cared sent early for improved for also for care Advantage long-term under XXX,XXX we quickly home value meals Accordingly, Medicaid reached provide Humana drive outset, risk has a kids care care. of Most on quickly prevention Today, our established

care. we're non-essential concerns services. for out flow steady to providers in patients continuity In and of these flow models of despite the contrast, and experienced service utilization experienced clients result, for first reach providers fee the decline cash the in because cash to a ensuring As dramatic

in $X in billion to second concerns, we payments liquidity early quarter. announced accelerated address help previously the providers As to provider

doubling to to of Just nearly compelling government of clinical XXXX Advantage of over Census the and seniors, the the experience states again found and X.X in number for the included sponsored five traditional to U.S. that XX as in by measures. and of Data approximately Kaiser dollar impact have patient offer individuals zero residents the all the XX% one plans further Medicare next CMS dental Family hearing, the XXXX. decade. in four. the Advantage with meaningfully outperformed years beneficiaries opportunity from program selecting the for Medicare XX% XX is CMS quality of demonstrated more than over value-based offering XX residents Advantage Medicare three all of the that or measures healthcare of MA access the system pandemic significant. Advantage to vision, four has one Bureau, growing Medicare organizations enrollment A six with and Advantage last wellness The XX decades, double publication the least over and in Foundation U.S. the proposition Medicare of plan with XXXX, and plans coming four half partnership from underscores at in of age the the Medicare care, indicates Medicare value the premium Coming million Advantage by enrollees value of or the U.S. with number

enrollment lessen have as our XX% disparities enables positioned the in these more of data traditional of income those for care, than costs community business Medicare saves determinants home Of disparities. the to social demonstrates efforts enrolled option improve Humana keep and at communities Medicare lower a underserved on growing beneficiaries being our health racial to both low Medicare and or there Data about taking ethnic a we ethnic of more as Medicaid Medicare traditional committed is business times supplement inpatient traditional for individuals seven to integrating racial to in leadership in benefits, than us beneficiaries With $XX,XXX the to are of plans average for This seniors to to Medicare. innovative communities expansion Medicare be the is delivery, that additional to running shows Analysis with have Advantage within as from is costs for XX% a Medicaid and with and to and for are shows in care XX individual to to social populations, Medicare been local an $X,XXX to pocket includes for organizations highly Advantage. compared of in as in holistic address a of overall. models beneficiary their role of This MA year level our than preferred Medicare seniors annual efforts out needs in grow leverage who continuing at to Medicare meal think platforms income traditional a members. less the uniquely the Advantage Medicare than relative minorities. XX% seniors Advantage Advantage home. respite higher efforts Advantage year. our million those improvements that Nearly more Medicare, with the diversity in simple health, well, data to and -- safer Advantage social support flexibilities isolation, health approach minorities

this another community. underserved the us Goal population has with We do by leveraging touch engage to successful health platform to point support and for our will our Bold members

as populations well. the of committed address June, to an communities to are our million how social to Humana meaningfully foundation. we initiatives programs serve, will designed deepening contributed determinants, In specific XXX Humana to younger invest the to We we the scale including This fact, foundation in in healthcare additional disparities. address endowment to understanding allow to continue affecting

last on care experience in with cost kidney several advance to solutions. While continued also holistic, improving in we care engaged care. home for Humana's to the moves effort care the reducing patient delivery coordinated have focused based our of strategy. delivering higher of in crisis These broader responding of companies innovative ecosystem outcomes an the public and members, several models companies to been entering acuity value total are months, we've health care and intended investments home-centric while our care partnerships over create to the and part Announcing provide into

awareness time where we will is home mentioned Heal allowing consumers. home consumer or be patient and based last home call, critical this in We like and scalable, partners and by of care consistently care Dispatch needs, and quarter's and acuity personalized hospital to their the demonstrate with safety comfort inherently models has at our remarks to approach strategic Heal as models patient hospice for recently superior XX increase infections continue a of Promoter that as partnerships as demonstrates and Humana outcomes. efficient home we visibility based primary the see to demand primary care reporting particularly want Kindred transforming more on home room outcomes. care we allow Home determinants believe social into clinical in in to and care health. stay. I preferred in they continue reinforced capital in emergency is improved members for caregiver omni-channel and risk drive to We and same invest models quality home of higher announced care which allows members through burden more for interest and As strategy. Health, The scores hospital based in health the programs while meeting higher my care includes to inpatient belief care Net home-based avoids more high-quality increased than clinic COVID serve result at based often to higher, health believe will more the patients a to in the high Health primary experienced is further value-based of offer model to deliver satisfaction allows secondary Dispatch ability complementary declines level reduces to recover often and the highly and of members

preventing the home populations and outcomes enhancing the we've Kindred been and hospitalizations. for Finally, clinical at and care patient more models effective in new the to improve at enable timely, unneeded experience and developing operational patient risk enhancements home, for most coordinated

designing Over are tested offerings, currently that fully integrated the months, began markets. collective of we which in models being leverage last the these several various capabilities

to together these the with have inpatient of scale ninth identifying clinicians cause Dispatch with do improve example, as Heal home a additional members also and address educate We're are emergency needs, solutions reductions pleased our only and to further proactively develop, Humana Kindred outreach an and emergency As the Humana early These need advanced member. care primary hospitalizations the health we identifies with appropriate physician, room and member and and examples desired leading will a at room are diseases, see when innovations. about and utilization kidney continue support we care recognizing high ongoing complex in refine partner to them Services death. clinical strategy primary care expect Health proactive also these and working to And they for how few members leveraging We've the by outcomes. kidney nation's members. immediate of who not to with

and continue can We in Advantage XXXX individuals serving we beyond to in care Medicare in-stage health our and impact positively with support renal experience. disease believe we

enable However, most treatment can early for detection that be can we we acknowledge we members. if and kidney disease impactful, our of

Our we initiatives and how focused better on both serve can are partnerships populations.

months, clinical care in offering help progression solutions options for initiatives these several home goal disease members multiple enhanced is with provide last agreements we've which the disease of early, Advantage educate partners commercial services certain members innovative, treatment to members dialysis. to detect Humana, our announced coordination and The and Over disease Medicare kidney about include markets. kidney slow

financial Before I'll to I turn performance. the call over Brian, briefly touch on our

strong last As year and I quarter, strategic from a financial said started all both businesses perspective. our the

are uncertain As and nearly that believe or well will us underlying that that XXXX XXXX we for offerings have provide to this access navigate beyond. straight up these We our sets times, we benefits. compelling pleased all our and plans members are enhanced believe stable

expected $XX.XX. the This be to to disproportionately we to the may the guidance the the duration deferred extent continued and But adjusted affected which in utilize of and discuss hotspots crisis. year acknowledging continue enhanced $XX.XX offer. and expected to as As range by members these communities help to crisis, our of occur the costs may to resume, initial full emergence benefits we the the reflects utilization to as our Brian XXXX across to our anticipate in constituencies will a moment, normalize back EPS investment of of half year maintain uncertainty nation the of many that while the procedures

during the costs. significant occur. quarter. Medicare the currently expect copay not in fund, gratitude of Medicare XXXX do in to spend our and of plans also reduced that met, requiring immense their utilization during our safeguards, the government my and efforts to members and we of response In last taking of our the relentlessly We year, we especially enhancements, to to all and this much pandemic. This want engagement. for robust The closing, from those To and to the pandemic. dedicated the threshold also result proactive must that mitigate I healthcare continue program declines to those my Humana delivering experienced and on for we more medical over thank transparent trust of When While at I dollar beginning second declines is stakeholders pay impact disabilities personalized members some are as the a to unanticipated experience benefits plans on actions utilization for in we $X.XX more months who on to care premiums benefits come these in heroes the continue experience the of the pride includes extraordinary At express several the to other level in individuals providers Advantage protecting rebate to work easier, incentivizes March is members. burden and as for proactive the that health the in want this utilization pandemic. of caring waivers with and plan rebate frontline if care pandemic, some government. and the ease every provide each to expect through associates while to be the for including of the also we're human premium

satisfaction It that XXXX outside third mail this received the the best Humana prestigious year been Study. the the Power above U.S. members experience, important most continuously to needs address our take Our the These beyond possible efforts and to are best that inside sell. of create customer order associates honor. consecutive in can so go action organization. pharmacy has they both to and the named is Humana and of achieve recognized JD and Pharmacy best has their Pharmacy

thanks in JD plans. to ranking turn I'll the offer Texas In member Power the I and that, XXX over ranked these of commercial Brian. teams. call Humana health XXXX my addition, With congratulations and to Florida in number one

Brian Kane

Thank and of have model human Bruce, going to particular those our communities good day the echoing associates I above out. for beyond and and morning serving thanks They day wavered by all and by Bruce's like in and continuing would begin mindset for began, members not you, everyone. pandemic in frontlines. for to care our praise the on since and our

serve, we are communities and the to crisis company grateful. long-term take members, impact to At the minimize system this global employer of that to on healthcare a whole. our and For we groups partners, advancing very continuing action Humana as provider of sustainability we the committed while our are the

economic throughout to review country quarter I will first treatment the stay reported COVID-XX. Before as of care These efforts. were materially movement of on the implemented second at actions, by the significant restrictions spread I incurred Today, offset impact of relief deferral as pandemic we ongoing was the $XX.XX. our physical these distancing discuss EPS and the for results care and the activity partially COVID-XX the well quarter from of The quarter. testing results of by deferral home orders, measures and in adjusted resulting impacted costs reduce other

anticipate of are net the As relief of second demand incur care half quarter which impact health will latter in and of be deferral I to favorability our of we for ongoing year. will care later, the second weighted pandemic financial from half as efforts, the heavily resulting the normalizes the describe in the services we offset XXXX the

to result COVID-XX second deferral half As particular prompted in that would of year we being earnings by amount the in full the disproportionate communicated, quarter. our of significant the anticipated first the weighted year and previously of a care

of bit second medical to was levels slower adjusted in resulting and anticipated, in we in from While ahead March April, than previous increased EPS it rebound our expectations. a quarter utilization trough June significantly

and levels. and it the July, saw in the treatment and April of expected costs we said meaningful In June, COVID COVID to average, service least through last were experienced rebound, bit utilization flat did April, modest volumes May, the cost the testing utilization. increase began approximately In as we depending utilization levels June decline As a recent XX% during quarter, non-COVID on normal certain weeks March in into In but on medical remained June, was at of two while recover not inpatient we XX% than utilization a of utilization continued cases category. continuing last higher the to throughout to pre-COVID below rebound although geographic excluding given to hotspots. late

in to standpoint, later our and the year our Medical progresses expect utilization above potentially scripts XX adequate to levels time. the a We in to normal the peaked also and trough surprisingly, mail order and day early a late run the May June, March non-COVID Not pharmacy had higher April, then begin in use order year. with normal prescriptions slightly through as and during experienced fills uptick this refilled during mail From and Prescription approach in an early late in we volume crisis. peaked saw in they ensure reflecting encouragement, impact supply ran fills April March their retail. members, both of as again

forward For we to normal pull rather within of close net out than represented utilization year, these expect rate the early run a refills full the levels to change. a year, given more pharmacy

However, in experienced number use increased group medical mail service. quarter, negative pharmacy not to been pandemic. development segments that retail financial We paid. persist activities providers expected Further recovery our primarily continue members response took reserved action and in the period as to should small prior patients on the to of and discussed and utilizing second is ease as both of due to the previously certain expected administrative the claims for suspension this focus burden to to order members the those allow Humana's their have claims

time designated therefore efforts when have COVID and only note, to a It of of delay largely collect financial resumed, we secret related the however, meaningful increasing these there charts review portion to we activities the are along dollars cases positive suspension payments in resume. of suspend as management over as activities financial efforts in these recovery operations and of of incidences a broader which important expect markets with is that continue a While utilization recovery in that few these results hospitalizations. hotspots, have we we and Coronavirus to

out of will EPS the provide providing the year, anticipated costs annual getting to the we various in view by patterns the the approximately three Consequently, of remainder groups expectation such expected year. $XXX today, employer impact risk historically payments $X XX% out by higher utilization Taking fourth the of the his we capitation a the more the final we back third end specifics I of testing and have utilization from an months our providers perspective, in investments enterprise of and for will quarter to million. COVID that and We half estimate in year, EPS is I of the entirely full utilization how year's our approximately we serve, amount support XX.XX. of be reiterated constituents. year. including and of on we and described experience that lowest to full to play as experience-to-date contribution year of providers, this for we that guidance billion. our the the are type will will lower remarks, few XXXX seasonality expect the a the many investors support year, as we Turning and of around hit now communities treatment fourth EPS the any offset support will provide the Bruce by of our considering the members, the that guide would From quarter. always as well fully at amount to quarter adjusted our expected for represent losses remind the XX.XX offset midpoint largely in expect

of half of have weighted back several of investments as year. the is many already While support initiatives, impact financial the mentioned, significant announced the I we towards these

of For engaging outpatient their example, members the and care largest of members our our increasingly waivers be telehealth remainder the to as are buyers expected utilize and copay to visits, for year reduce to the providers primary with financial care, among the to costs associated members throughout system. be support health designed we'll encouraged with the investments behavioral health

ensuring for able telehealth and In are primary via needs. determinant nurse in members and with are care identify or increasing their to in addition, the care of we and home assessments availability engage members, to in our social physicians gaps address homes practitioners

that where providers will interact we're so initiatives restricted and in for distribution channels; members and our they dollars can also the making and significant marketing given investments circumstances to for includes in are additional training year with support provide face We as consumers engagements and events equipping our pandemic. progresses. face the consider community to Furthermore, brokers Medicare digitally, the we the telephonically AEP. This increasing brokers

to Foundation cost ratio, other XXX over to costs marketing these to with associates year the at home operating know, you facilities expected approximately our half our are office, to year, increase the back are along moving As with points contributions the expectations. basis safe weighted full associated work COVID-related and These heavily reworking consolidated our Humana costs eventual the quarter. of for primarily fourth costs the an pre-COVID return to the and

be second meaningfully elevated investment COVID meaningful medical treatment expenses, above utilization combination being spending, a portion result testing half the will will back expected increase and of costs half the ratio in with the along classified weighted Additionally, as our which in medical and pre-COVID continual expectations. expense of

expect we second our than Specifically, to consolidated of half points to ratio pre-COVID expectations. higher be basis the our neighborhood XXX benefit XXX in

XXX,XXX. year operational of comments to from MA full $XX.XX expected a our few to each today, brief we range revenues business I'll have growth our of XXXX increased XXX,XXX membership to year-over-year In to our increased individual And year-to-date. provide billion XXX,XXX on XX% members XXX,XXX retail, a of range Finally, segments. previous

This terminations platform a compelling broaden with our product brokers compelling sales a volumes, impacted member and of customers we continue and to to Difficulty] our although and has products [Technical alike resonate amount for create great customers. increases, resources includes slightly membership increased and Our strong also have growth effort where COVID are down.

the XXX,XXX December bringing Specifically, to our on members XX, segment, less than June With our to We're markets from COVID are X, multi-year lives trends as medical June account XX, by in a current of has develop. grown resulting of strong of of talent, certain decent and XX, membership from presence we XX% from first net of we're severe reflecting growth, increased XXX,XXX COVID-XX the and such or how December for pandemic. as a in economic specialty driven approximately we key Kentucky Care were Medicaid, membership members membership sustainable In particularly unemployment deepening Accolade plan the additional increase far and our the to the of XX, anticipated. XXXX. XXX,XXX respect contract or downturn from execute and January commercial watching transition specialty our companies XXX,XXX as declines phase Source well innovative to on as in grow Florida, Though as products. primarily so the XX% to rest enrollment, local also our closely partnership new group increasing continuing the of approximately

our in PDP driven declines. services growth a EBITDA anticipated Lastly, partially healthcare by was year-to-date higher as of by fueled membership the Advantage increased segment Carson. pharmacy partners XX% by growth, in adjusted continue EBITDA is membership as our segment, improvements assets to partnership offset Medicare earnings also result and a [indiscernible] that provider our primary It invest operational note expand COVID-XX. in Welsh, overall in care important to result to through that with also we businesses of the utilization

question Vegas scheduled that, Houston. well the presence new early includes This in clinics new lines and openings we we additional with be limit Specifically, Louisiana, Operator, in for In Las the but please year. separate as summer as will first Bruce, centers those beginning markets, you make your With opening that fairness questions. queue, XX Shreveport, we locations, in ask I possible. and throughout with our yourself Q&A open as please one the we up next note are introduce late in the Amy will to waiting expanding two also to smooth that caller. will rolling as

Operator

Yes.

our from Lake Justin first line Research. question Wolfe have of We the with

is Your open. line now

Justin Lake

[Technical from expected it's year Difficulty] to would EPS Difficulty] you going Difficulty]. ask a helpful [Technical tax more year Can any And into you're of share Difficulty] have then, about be bids case $X how as the I versus benefit. year where specifically MA next than the expected regarding wanted [Technical margins Difficulty] the color little to Thanks. much you around bottom-line to bit rate that lower XXXX your [Technical reinvested a next well. next [Technical

Brian Kane

on months And Good been have crackle line. a I the spot know if apologize I have challenge, same a I for getting five I've morning, Justin. I in crackle. a I'm my and

So I apologize.

that's past We how a important have Difficulty]. margin the to sustainable to we've investing really we've that and Other say gross the that we tried as business [Technical take do. balance we've in on than not said really proposition in the between commented reinvested

get as impact third the how after we know, than you and And specifics will with I the on on is specifically the the save invested. quarter when you've could third rather quarter much [Technical that margins, we so, point; more say a that you so Difficulty]that as the quarter. tax bit tax I'd we'll the at respect we'll said little get of third color more with the give commentary taxes we've give is more Justin the from as but give XXX respect call this again, call. margins, the changes With for pre quarter and to geography we'll some portion tax impact to on that call. not back the comment share around that Other third a said, It comment to

Operator

the comes Your of Jefferies. Windley from with Dave line next question

Your line open. is now

Dave Styblo

why in XX% from just would try Dave normalize the to and of Good to your talk benefits XX benefit half BCP of you little level bit quarter sequentially if for like to morning, quarter, I down, Styblo in what first a payable it's if Dave it accounts are most was because better of I in the through XX-day reserves typical it increased Windley. seems flat group peers the trying wondering of a the get expenses could increase. when about only have the that understanding jump for in day a been second your

there great. color would any So be

Bruce Broussard

Sure, good morning.

IBNR saw the One June BCP. said, utilization our being quarter. And two most month accounted the and the is because for you to reserve our the is for Specifically, on the as where most primary of because month highest it's lower relates in said, recent expense medical is, I'd the call way the June things quarter.

June you're you if and an get lower So overall reserve, hired going higher average medical expenses have of to BCP.

of on The that, also relationships, medical benefiting other members providers are based the this our based expenses. our important our lower is risk thing XX% providers to is risk and from

BCP. quarter, we at so going therefore, levels divide expense to average you our higher you're And capitation Humana that lower the a medical are out And paying to get higher for risk providers. by the when

in up capitation see disclosure, amount the is quarter surprisingly when the so materially you'll COVID given XX-Q again, of you And look that here. from last not pretty impacts our

Operator

Your from with of Kevin the Fischbeck Bank of comes question next line America.

is now line Your open.

Kevin Fischbeck

[Technical Difficulty].

is understand about into to price bids? unusual you it are year how necessary wanted to a and given, thinking is trends, little you bit your for an what you when priced year this achieve you Difficulty] next whatever [Technical Just XXXX about

Bruce Broussard

Yes.

terms to and we So, I our very what think through go process trends; a baseline a taken value would obviously, of we've approach in be. prudent extensive typical a

then, very we what And you in I prudent I COVID there would rigorous so I Obviously, tell you that expectations and to to obviously, impact. we a model And we been need And think process are. there. just have are through COVID we've we've for in been your I price variables consider. would lot that trends. think just with the of prudent those how say went a

we feel about about put XXXX. So good and for bids I broadly good we our feel we into bids trends think, our more the

Operator

the from Your Bob Sachs. of comes Goldman next Jones question line with

open. now is line Your

Bob Jones

confident membership? additional ask normal getting about I this be difficulties driving managing you you would think the environment net in I just obvious and leveraging we book, through signs; to guess the a And the period make imagine encouraging you're in a year? just given membership enrollment new approaches than in difficult maybe then, as current individual what revised they're about maybe annual what members. how MA Can talk does the a to growth more

Brian Kane

and let I'll Brian add it. to then start off

phone, a them of and from we telephonic providers, the results know, in number you person. I'm to there specifically continue mean, I really see have over we than probably As sorry more strong distribution partners out

Part have seen of leveraged of And aspect this. as other is, we retention increased our so we've some, that result significantly. a the

is some a this is, other period during the just of time. company improve seen And the we've wonderful our is results area, retention on So growth. D-SNP really seen then

Our the is D-SNP significantly, years. both as year-by-year up you'll see percentage growth, over number as last but also just a significantly of

of telephonic to time, increased. that that leverage combination the Obviously, area our the a other during our agent proposition value D-SNP it's of then as the are our that So period and is ability partners there. allows and retention

Operator

Your of next with JPMorgan. question the from comes line Gary Taylor

Your is open. line now

Gary Taylor

I what's question a this through. direct rebate second presumed reduce be and MLR of material, about, half most am third four, utilization the of would think minimum MLR order second, expectation? the rebound in right thinking of magnitude, just estimates. be cost would second half impacting sharing baked magnitude some would detailed walk appreciate you I of is COVID as be the and into But, costs terms would be think Brian, terms I about this comments probably your for of we order in

Brian Kane

much the I'm question. on appreciate too to I going that. not comment

the think you all cited items I meaningful. are

be marketing efforts important and quarter the there. fourth also will brokers supporting the in You're our

really and in of are to initiatives And contribute so spending. all we think think back change that a sort of there number half I the

it's what But is So saying a you're not incorrect. combination. think I broadly real

necessarily I think it's other. the directionally reasonable. But towards again, I one wait wouldn't

quarters spending how on up. unfold We go where the things will ends see also our as and

Operator

question the next with comes Sandler. line Piper from Sarah of Your James

Your open. line now is

Sarah James

understand contract there the providers to this can for delay that's they're for? size, rebound And then, and wanted under claims the of or I out recapture of a of half, in on review then delay they they're compassionate if cohort kind thinking you hook financial about the viability, second impact the doing coming more claims, of future you're So utilization that settlements. have the that and review value based this

So appropriately training second their how reserve and the them are through handle walking finances or Thanks. you half? them to for

Brian Kane

think that we've taken aware actions our well their on providers behalf. the I of Well, are initiatives and

get And know, hard in so flow. with them. of We've amounts communication worked significant we've constant you I them been to very cash

not And pursuing said, a programs. number discussions really ultimately financial FR. we've As with and know communications, recoveries. that we've been will we the about our our we But these waived utilization have them they of management in

overpayment, they We're we as But aware But, to bounce And trying right so of year, been that we for as we they that. the it but down. be think aware are, But aggressively, we're in that thoughtful aggressively settle think they with later they're this reconcile not appreciate. if it's can I very to things there need be with constructive now, think providers. ultimately financial back [Technical that I also want fully pursuing will a not as something it. which I of example, them, showing understand there's are to Difficulty] our

Sarah James

financial And can review? you delayed size that

Brian Kane

for can but Yes. mean, size negative the it's our period FR. want you not wouldn't specifics you I I'd that rather I on it of can had and we've again, PPD development, part as the see give imagine, to a quarter. meaningful prior

typically And It's several so XXXX. far normally, month the it's of beginning that delay. positive, year, also have also a this would point of in we parts the

of a period So there's amounts collected. that be prior period ultimately of and combination would current sort that

Bruce Broussard

second value until the the being aside, manage your just on able half. payment aspect is the really to important that based I'm question provider following that's don't other Just know we on with to the settle year. One up

offset the in but So sort flow the it. is a so they end settle that yet, or to what appropriate, progresses. receivable improve cash second as happens of that And the in there or the first dollars half year it haven't year, result of payable of is the half, though, year, a Their up then, received stable. those a so we could the at of will is

Operator

Your Research now comes next line line Your Raskin is from open. question Josh the with of Nephron

Josh Raskin

how dollar et without donations that actions them of necessarily it's directionally through required around Foundation, Advantage are of even -- copay this lower et cost. but have see don't just to much just expecting to premium utilization of in that's a fact to total versus Humana the them Glad the attached to cetera, the is some waivers rebates, premiums MLR cetera. voluntary smaller and to member much give amounts And in percentage you're a minimum actions then, of lot it, of harder light Medicare rebates offset

deliver. So that benefits help of understanding been to able of us with examples some you've

things to meals some the members that but offset utilization. other about talked that lower you're You delivering to again, of

Brian Kane

the rebates, back trying to are I'll to With MLR these some and the do MLR higher we we're the than right didn't that. taking. bounce would dollars we closer there it's say we're members positive And have to and of is of rebates that would a which that small in thing rebates, some program I MLR natural it's Yes. minimize the here actions course, obviously thing rebate bouncing respect rebates threshold our take to be would that's and because MLR a others. but actions that accrued, the our are that really for give MLR But Josh, the relatively take the mechanism I membership. and the contracts

masks they will will that MLR We well we the so, as we are we rebates talked talked are And States the roaming significant. around people and minimize the masks, positive. we millions actions a kits and mentioned, which now hope pretty with about There's United received. the that's these waiving about think delivering taking of we're you them safety and be copays, green having food,

our of having they COVID issues refrigerator, have in addressed. sure their it's needs their million of about also, may they to be members, members Importantly making needs don't talk got the sure million around the to a to making we've sure and they over needs that and whether medical food them in -- have making reached prescription drugs, they significant out to some we've be X.X have

will care in think, I members some very so there's for that the meaningful Hopefully give our coordination in also up efforts significant a our And color. ramp that crisis.

Bruce Broussard

Yes.

the and area. there's And it's add obviously just less think on to than [indiscernible] would benefits I for dollar encouraged on the copay we the have being there's any side, there. are goal barriers and Brian, that But say that we've that another themselves I to how probably Just also are that, an financial clinical barriers eliminate that. underlying is of out telehealth treated any provider important also part the

to outreach that So the traditionally program Obviously, case. just are being clinical getting to the there's aspects haven't into are been side, people's from important the homes this. on spent that that way dollars getting that all doctors was a the lot homes of discussed in the nurses

see probably the So healthcare limitations more really having on help dollar you'll the there. clinical being to in the system spent support of capacity as side circumstance

you possible the try articulated delayed as to little a more really that. on the but sides harder the So to role Medicare proactive help benefit and our with is think side, be I in care much

Operator

with of the Your question line from Morgan Stanley. comes Ricky Goldwasser next

Your now line is open.

Ricky Goldwasser

one order thoughts HHS how on Just it more Difficulty]? that do it's -- the telehealth to office [Technical [Technical were to wanted talked to Josh and home traditional primary an executive the within the parity sustainable to think and and integration about Medicare follow-up care in on comment, long on role. so between review the question state And was you response Difficulty] for then, continue at the possible. Any of telehealth the you word rates level

a seeing? that that So little early points And talked that are prepared you're specific [Technical Difficulty] in to your what you're what planning the bit -- the are data markets remarks? what

Bruce Broussard

for disclosed just competitive markets haven't We the reasons.

side, visits a on are downstream me and the relation. health on try is we home both let So the to both area, side continued side in what reduction and ER But Heal hospital care your Dispatch care in reverse go seeing in questioning just the primary and here. the side primary Kindred

seeing So downstream much prevent hospitalizations. more what on engaged the being to for in more member as the we're the ability seeing much proactive,

really approach that see normal and see, oriented the disease We've a but when for progression, it -- models you our wanted are with are a ensure a we appropriate I and as we health to disease live tele that. believe take to view. gets we care it's pandemic much think more the over number home We just morning, about an seen On primary of ER the years ensure we telehealth, life, system to where and individual but to a these that's time that when much can is holistic visits, that channel providers the payment the condition that just important providing at engaging construct particularly the positive are and to encouraging we lot paying stated are And this their we for reenter office and payment encourage the feel prevent more question get or a this this which point care then time, where is last will that customer. leaving as proper a visit a in using are on addition, of the the more we environment completely and on to omni-channel will the slowing telehealth from in proactive we we much prepared the of use -- we only it'll Believe that visit. do we're reduction, I the it's proper office because for concerned needed, and right not this people for tell side, them, needed telehealth of healthier the proper progression. your of the how rates as now homes also obviously also a more cost in in not slowdown equivalent preference do

Operator

Leerink. Stephen of with line through comes question next Tanal Your SVB

is now open. Your line

Stephen Tanal

other back the if apply adjusted might of or a ability the talked could around the my than first of utilization capitated But of of minimum reduction the of business. us Maybe the then, what made if of sense reflects the any of that segment, just services wanted on from helpful about Obviously, some Thank you think guidance that you. around around sense actual remains just sort understanding you proportion And follow maybe give MLR global to achieve of half. levers -- that direct a utilization, outcome to wanted line ideal? if really to question or the a understand light is second up comments upside implies whether EBITDA segment some have below to the the half members. just just give the discussion that levers were great in you to be EPS regulatory I revenue and premium also would be for you indirect XX% to the to low or in gross premiums the I adjusted in there normal, in rebate the side. on the some a us MLRs percentage point directional don't kind that it on offsets the would

Bruce Broussard

with think Well, can that we're flexibility what me there's said, terms dollars necessarily utilization go have that guidance and flexibility additional certain changing as them get But to go stay is of opportunities so we're ways we flow it's with and we the members constituents, let of how are we're in our half obviously, into also but monitoring needs But will MA in to very on very we this that as we out everything a an can to order very, focused It's Clearly there premiums, But can our bounce how range. not and there we're get about the not exactly to additional here. hands be. income here providers, continue back needs I our things also side some products. and to something within the estimating closely. to thinking we art initial their them the with year. on doing science back dollars around work our help through. cash with There's do hard marketing working

and And benefit these various we're do to that who so our dollars to going work get to constituents it. continue could to from to try

of our our revenue of so But very actually relatively it's businesses On on pharmacy and the a that capitated the because for a small percentage. amount percentage services businesses, basis. for provider high side large the capitation is it's

progression pharmacy that in provider you that year, of several that. in dollars important significant say see they a increase, our have see mean, was the said, on versus or and and the capitated, volume think, bit little of even our side, growth being too the we our which last so than see guide here, doing not. a seen our that's will the is So also playing EBITDA That EBITDA helping into script sort there has not sort that we'll even fully continues the And services billion seeing I lot expectations there. nice of coming better EBITDA the most a could initial business We're of capitated, mail growth There that order rate we offsets premium year in through. many non-COVID were a would I of held. have on side benefits whether so is largely I businesses, of COVID penetration

So in said on down it you held But think this remarks XX largely while script day environment and that to basis. converted equivalent might when largely a our we be volume scripts. the as held. is script in do you XX-day it's It's

from seeing provider in utilization material our COVID business. not the we're than other on So segment services the a declining impact

Operator

Your of Bank. next with comes question from the Deutsche Hill George line

open. now is line Your

George Hill

two the telemedicine. follow on May be up quick is One questions.

you've of in of think growth any could And mail about the seen would the follow-up that guess First, about kind and on talk my it and be primary care you increased crisis how the telemedicine guys the then, utilization you services does partnerships? change utilization. I given third COVID

the guys or do of a you seen, mail expect that how you You have while it to of you retail? maintain see you. will a adorable do lot go to level penetration higher book in Thank guess back be, I think

Bruce Broussard

Yes.

year, the telemedicine number claims the year-to-date last of up, lot again, I telephonically. of it's a terms of are XX, we've visits times volume received mean, just XX in not versus terms of A of In health visits, happening surprise. the

visits is are doing providers, Importantly, for their documentation if revenue video like own and our audio with what important this for are should that, I of particularly opposed for say our only, from perspective or we've who telehealth which systems, a also XX% is audio/video, businesses, XXXX. the as something seen to directly

meaningful you've interesting think us element What's real-time tick. that a certainly some before, seeing are clinics, our persist. persist, we day. -- I which see get but and Whether in will own heard So, every data up we'll we discuss this

we back system visits. As up, see person did in the a transfer opened

it And or the was telehealth. crisis, XX% telehealth peak XX%, of so went the down XX% during to where it XX% or

to desire and be their others with meet real a doctor there's and seniors, for meet particularly person. in with think I social

don't forward. telehealth to change think is a that's take hold do will going critical going but So, that to general we think think supplement really we care the we program

goes, element. have exact important critical part that weighting we'll see, to it'll be but to so be And going really going How it's a forward.

George Hill

mail the On order script?

Bruce Broussard

a of time they to that, it's channel. preferable now that We haven't COVID. see do that the our believe We experienced mail the a public order a as to work experience period in a little as bit. a shown we the itself really convenience it in to coming has members think especially of order the got into lot down Obviously, that being we see mail of to normal more significant from a and channel for on we we'll that during result increase But a continue are we given that we visibility see markets, the and continue continue level. increases this time

Operator

question next Willoughby Steve Your from Research. with Cleveland comes of the line

now open. line Your is

Steve Willoughby

I two things. quick just guess

First, you. do terms in anything year? MA color update Thank to group any versus selling have as is to as it season provide scoring you given this you pandemic? relates then, of additional relates or could the risk could there expectations the And provide you color it

Brian Kane

hear the of repeat question. second. sorry, But first your got I I the second can you I'm part, maybe the I'll part. get Steve, first part the didn't to

for would in we of to results terms that that the just XXXX. side, our track need for plans the say on I On scoring we operational getting risk that are

And question, either ancillary and really the into need effort, sure those in doctors are prior that that that and video. or has the the they the getting ensuring conditions. of documenting big mentioned first care getting also focus person effect these and health to we're portion home that of I telehealth deliberate identifying make real the members up of primary are via on in practitioners visits a telehealth and our foremost As dramatically, to we've the made members the are care

hit So, make have but next we're we so There's our months do so here five work the good, we far early. it's operational of lot sure so plans, still in a to to or four on far. pace

apologize. mind wouldn't If you repeating, I

Steve Willoughby

No Yes. headset. have problem. my been It might

the provide this you into relates Just it selling next color as point. any MA to at could season going group year

Brian Kane

So on the group year, of are interesting MA up. side, large so interesting, accounts XXXX is number there an of

lost of would And of might so it, I we and just down from are it's sort swings membership this year working these some I we've numbers a that We we're achievable be being XXXX. large that overall. big there very perspective. would jumbo through year won of that some There still number growth but the say that slightly many up some, carry of disciplined, committed say price competitive. we accounts very which will were to have so they're to And the through membership. a this and accounts were

think, years. large these would say we year it be But But spaces and But we obviously, group I -- what look at big working the growth showing, next large become, period, down. year. end could for up year again, digit extremely slightly see slightly here. we're last accounts I competitive over through the are mid-double with we'll we've players the just think few I the had seven

Operator

comes line from the Rice of A.J. next with Your question Suisse. Credit

now is open. line Your

A.J. Rice

much bit you just procedures expectations. that more that way do And much order on And my a even any about original of part this giving there. there to all how have might of two not constituents procedures, looking backlog probably But basis Is enrollment. I little to what up versus I'll back. guess utilization I to And to that's any deferrals and like? give you're in MA much questions, out or other some the There's discussion end it year about then, up the size a that's when back XXX you points parse utilization quick to you're related say of whatever. being of half you're real way that really call out know exist? to would may to how backlog or to be two doing how are magnitude, related relative to parts think your Maybe your the MLR back talking XXX what

really of on you of we think normal lot it any step that occurred MA have enrollment you going would as might. you and the You've years for you got this do path had reason a business. much up. a good year, normally think members? year. year don't those you're year you Obviously, second margin There's on. trend or that accelerated Do a Or the not Then sort a in two last dynamics have first of as ageing did for have fast

Brian Kane

similar second similar they're to in what question, I the pattern terms around plans around operational your sure really on documentation side. of seeing I would a a say last making think we're the your question on

and to so good they're that focused on. ensure very far we're team with So to a that very, our path, somehow job that The get similar but on members extraordinary has done engage really them. retail we

very we do so, And we're that, focused there. continue to

thing is On the that say and sort $X of back a not that, that basis in would giving the back of all say year. back of of about happening is is or going we're amount say that's be to good I'd MLR, portion half of said parsing out the half but a billion XXX so and portion I MLR that of is one points, we would XXX good in support. I the

And so you helps hopefully [indiscernible]. that

A.J. Rice

a that, just add on as normal. deferred Could are I first half looking and surge it the rebound or that normal sort -- at you sort of in you like half, the a that utilization back was more sounds in of opposed utilization to

Brian Kane

virus the of and above. remarks it progression what location. markets as goes see the might above back particular back we severe on and I normal could that year, to the to periodically where depending be baseline there of our say slightly was is that pace getting bouncing any happen we normal, slightly, we're periods in said a the in where Yes. would could more We've goes above seen it it goes how throughout few normal,

close would drag the think above to half it. it earnings. perhaps and them treatment so costs costs so, well. testing of that's and it take And sort then, I That with right, we as also normal be above on but that'll a back have the broadly, And COVID

Operator

with from comes the next Your question Borsch line Matthew of BMO.

Your line is now open.

Matthew Borsch

if hear of seeing if and and Clicking close So more know seeing plans. Difficulty] retail that, the that's competition startup, in MA you're MA seen group I on I have hope I what on plan. Difficulty] don't you Any these story you're companies, Walmart non-public [Technical some from more of you the guess is thoughts the [Technical level to for me Difficulty] [Technical morning. can there.

Bruce Broussard

Yes.

that. take me Let

to see that And They substantially a do seen. northeast investments, grew oriented last concern our so I and market with being levels in proposition our there's in a mean, with of the we've the But in more in of our they are investments they're differentiator but our the a but that grew we better is bit we're smaller and experienced of real I Texas that a strong, ones some clinical and doing And experience of experience. that both in compete a a on Obviously we front, to that that. the we some Florida markets probably that strong think we've very continue to a value and little providers. few through plans. the base, and competitive addition them. is the there the of our our on brand believe customers see continue some that base with small technology some On year we our to as always us, in is marketplace.

value as not view, what in to So benefit second I an being think was a as they competitor, proposition they're view but our that point and from think competes a that continue I to think your ahead clinical of actually of point from question? only experience gets I look doing. And increase what continues at of

Matthew Borsch

Well, Walmart I launching be -- might that heard

Bruce Broussard

long they're the MA getting not in have Yes. period that MA the but competitor distribution business. I'm time And really On into a one, business time getting other we also had agnostic traditionally product for products a products. of Humana a distribute one products. distribute so sold that they're their actually managed that sorry. at with -- into they would they force business; and them that We been sales relationship

continue people don't think, we store so speak get as much provide another to So them and see frankly it a or to on and for their a of for to it shelf a I we product it to in our don't can it's distributor like great the come for change, customers, be to compliment a as see their into territory but anything to they being way as continue us. we us

Operator

next Newshel Evercore with line Your ISI. from comes the of Mike question

open. now is line Your

Mike Newshel

a competing in bigger your have on actually and AEP. industry plans? that's good this Do on to and distribution, any impact relative from so you growth? competition performance share having question there telephonic I a see far as your year, of channels the phone sales channel related this shift and versus yourself you advantage visual is any expect market some that Would

Bruce Broussard

those have continuing it of We've as a there. a relationships really comment to result I continue any channel specificity of I'm the being mean, grow seen that not it. strong we is with convenience as to going to partners.

We a we continue proprietary something our don't channel. to somebody marketplace. it's that have is that I competitors in That see investments by think over else.

and retention but think we I channel it channel only do matter use. channel the think the Again, it. believe marketplace shine, customer. we no something So will is what proven the have that that we others also do the see to continue in we use competitive as is important, the we I not being a to ability side then And retain that

Operator

line Steve of the Valiquette from Barclays. comes question next Your with

Your line is now open.

Andrew Mok

I This on Steve. ESRD. ask is wanted about Andrew to Mok for

have As full relaxed design or And season, curious XXXX? in and your the among offerings to XXXX? that we updated impacts hear do Medicare network on the any to closer the your product you Thanks. on for adequacy Advantage patients for views uptake ESRD standards enrollment network I'm open how get thoughts

Bruce Broussard

we would rate the what of indication Medicare any Advantage. given not within penetration have We be think

provide think we'll I So leave the it experts to industry to that.

or lack nature a to believe into offer the result believe, customers I result of able a the more out much broader view home, do for an ability as deliver offer, a compelling in for adequacy into us or being competitive to product -- the On ability network whether competitive in it's now nature able gives the the bring help a the whether point marketplace as of of providers side, that we marketplace, the also in in network ability much other the to to to bring marketplace. of our the industry or in it's for a telephonic to from alternatives be care innovation

a government. large being So able allowing we customers and our and for industry look choices cost solution many federal at this effective as the deliver effective, much the very cost positive a a really for same for in more more time, marketplace and the at the much more to

Operator

Your Mayo next with question comes the from Whit UBS. line of

is line Your now open.

Whit Mayo

that on last follow-up a just Maybe question.

in partnerships that. the And I thought hear think about haven't bit I number Corbin mix next year, still some really think sure. to of care and you the about little like more for not time, a that's kidney I announced guys recently in a Hospice

your update maybe on current just be great. an thoughts would So

Bruce Broussard

to want you Brian, take that? And

Brian Kane

to it's we kidney from how chronic slow around, ESRD. partnerships conditions Sure. really, the With to progression kidney respect do disease

this, It's good We're excited that we we're early so we believe really we've there. impact through but the have partners that working make partnerships meaningful with. struck. and we that, can some that And obviously days working about a still

constructive the figure how in to being how Medicare patients trying see and we'll answer care people they So meaningful light we and do those where out that number would are go just that Advantage, may say -- I are. of these ESRD of individuals. for how especially

Advantage so spent care could enhanced more of developing care on as think anticipate it's programs the participating the it's life say a early think various phases phases. through that in in teams again, potentially more be something our been it'd focused but of time getting Hospice a a potentially a and their of again, We more part could have results well partnerships. With and think that. lower system result lot members are hospice We for be a care. also in lot the the will terms pilot. kidney through transition be some through our do pilot creating various of able as our it. savings to And And working actually and that'll days. much the create, proceed It's patients. as And, think working to the only Corbin, still We outcomes internally coordination have in start very, very of We very by we to well about we've that have merit topic. seamless we're to our still for there lot of they as Medicare I seamless that'll system respect much better the we're costs,

Bruce Broussard

partnerships a comments Brian's from the I to to of adding of even expanding early just of how number think evident I that -- think the set example we've early that has this. stages our much just more and competitive on partnerships, marketplace adequacy good network the its today in the created really is marketplace established a

network. of the think I expansion the of a is it So power to testimony the

Operator

no And over questions at the back remarks. we Broussard now turn for this will time. call have I Bruce to further closing

Bruce Broussard

is this I little time. than normal know quarterly appreciate I a everyone's calls. longer

be performance provide in the many done thanking this able and shareholders a being home, to able results leave then being over the job our and transition have able financial to that members, can't the serve teammates addition, wonderful provided shareholders the that So and we have to saw also, engagement that without our the our our all you to quarter. And appreciate operating support in obviously I us last years. call our XX,XXX

your and everyone, you, support. thank you for thank again So

Operator

conference today's This concludes for you participation. call. your Thank

disconnect. You may now

Humana (HUM) 5 Aug 202020 Q2 Earnings call transcript