Humana
| Company type | For-profit corporation |
|---|---|
| Industry | Health insurance |
| Predecessor | Extendicare Inc. |
| Founded | 1961 |
| Founder | David A. Jones Sr., Wendell Cherry |
| Successor | Galen Health Care (hospital division, 1994) |
| Headquarters | Louisville , United States |
Area served | United States |
Key people | Susan Diamond (CFO) |
| Products | Health insurance, healthcare services |
| Website | www |
Humana Inc. is a for-profit health insurance corporation based in Louisville, Kentucky, USA. In 2024, it was ranked 92nd on the Fortune 500 list, making it the top revenue-generating company headquartered in Kentucky. It stands as the fourth largest health insurer within the United States.
1961–1983: Nursing Homes and Hospital Operations
In 1961, attorneys David A. Jones Sr. and Wendell Cherry established a company focused on nursing homes, which by 1968 had evolved into Extendicare Inc., becoming the nation’s largest operator of nursing home facilities. They divested this business in 1972 to concentrate their efforts on hospital management.
The company was renamed Humana Inc. in 1974 to reflect a commitment to more compassionate healthcare services rather than impersonal care. Growth was achieved through both internal development and key acquisitions, including the 1978 purchase of American Medicorp Inc., which doubled Humana’s size and secured its position as the world’s leading hospital operator by the 1980s. During this era, Humana pioneered the double corridor hospital design, enhancing patient care by improving nurse accessibility.
1984–Present
As the U.S. healthcare landscape transformed during the 1980s, Humana adapted by launching its own health insurance offerings after losing a significant contract in Arizona.
By 1993, Humana had become the country’s largest hospital operator with ownership of 77 hospitals. The company subsequently separated its hospital division into Galen Health Care, which was sold in 1994 to Columbia Hospital Corporation of America for $3.4 billion.
Following CEO Jones’ departure in 1997, United Healthcare attempted a takeover of Humana in 1998 but retracted after a $2.9 billion decline in United’s stock market value. In 2001, Humana co-established Avality to broaden its involvement in healthcare technology solutions.
In 2005, Humana collaborated with Virgin Group to promote healthy habits among its members. The next year, it partnered with the CDC to develop innovative approaches to population health management.
Humana reentered healthcare services in 2010 by acquiring Concentra Inc., a Texas-based provider of urgent care and physical therapy centers, for $790 million. In 2011, it implemented mobileStorm’s HIPAA-compliant communication platform for patient engagement.
In 2015, Humana divested Concentra for approximately $1 billion to support a $2 billion share repurchase program and other corporate initiatives. That same year, Aetna announced plans to acquire Humana for $37 billion; however, federal courts blocked the merger in 2017.
In 2018, Humana purchased a 40% interest in Kindred Healthcare’s home health and hospice segment, "Kindred at Home," investing around $800 million alongside private equity partners. It also launched Humana Studio H, focusing on digital health and data analytics.
The home healthcare portfolio expanded further with the acquisition of Enclara Healthcare in 2019. In 2021, Susan Diamond was appointed as permanent CFO during a strategic emphasis on home-based care; Humana increased its ownership stake in Kindred at Home to 60%.
In April 2022, as part of evolving its business strategy, Humana sold a majority (60%) stake in Kindred at Home to Clayton, Dubilier & Rice for $2.8 billion.
In February 2023, Humana announced its withdrawal from the employer-sponsored commercial group insurance market, marking a strategic realignment toward other sectors within healthcare.
Sponsorship
Humana serves as the presenting sponsor for the Grand Ole Opry and the National Senior Games. Since 1979, it has played a key role as a principal sponsor of the annual Humana Festival of New American Plays held in Louisville, Kentucky.
Prominent endorsements include LPGA professional Nancy Scranton, who acts as a spokesperson aimed at engaging Humana’s female demographic. The Humana Foundation collaborates with PGA Tour professional David Toms' foundation to aid children’s charities in New Orleans. Additionally, Humana functions as the official health benefits provider for both the PGA Tour and Champions Tour.
The Humana Distaff Handicap is a Grade 1 thoroughbred race hosted yearly at Churchill Downs on Kentucky Derby day, offering a purse of $250,000.
Humana Military Healthcare Services
Established in 1993 as a fully owned subsidiary, Humana Military Healthcare Services (HMHS) secured its initial TRICARE contract in 1995 and began serving military beneficiaries in 1996. Between 2004 and 2009, HMHS administered the Department of Defense Military Health System TRICARE South Region.
In 2009, United Military and Veterans Services (a subsidiary of UnitedHealth Group) was awarded the contract; however, HMHS successfully challenged this decision through the Government Accountability Office. By 2011, HMHS regained a five-year contract valued at $23.5 billion to manage military healthcare benefits in the South region, which was realigned as the TRICARE East region in 2018.
On December 22, 2022, the Department of Defense reaffirmed Humana Military’s role by awarding it the managed care support contract for the TRICARE East Region.
Legal campaign against drug price fixing
In August 2019, Humana initiated legal action against 37 defendants, alleging a widespread conspiracy to manipulate generic drug prices. This followed a smaller related lawsuit filed in October 2018.
Controversy
In 1987, Humana filed suit against NBC over an episode of St. Elsewhere that depicted a fictional hospital being sold to a for-profit entity called "Ecumena," citing trademark infringement concerns. During its broadcast run, NBC was mandated to include a disclaimer clarifying that the show was not connected to Humana.
On May 30, 1996, Dr. Linda Peeno—who had been contracted by Humana for nine months—testified before Congress criticizing managed care practices, alleging that financial motivations led to unethical decisions affecting patient care. This testimony was later featured in Michael Moore’s 2007 documentary Sicko. Humana responded by emphasizing that Peeno was only a part-time contractor and contested certain claims she made about coverage denials.
In 1999, Michael Moore’s television program The Awful Truth highlighted Humana’s refusal to cover a transplant for a diabetic patient due to policy exclusions. Following public outcry, Humana reversed its stance and approved the necessary treatment.
On September 21, 2009, the U.S. Department of Health and Human Services investigated Humana after AARP accused it of distributing misleading flyers to Medicare beneficiaries. The materials suggested that fundamental Medicare benefits might be eliminated under healthcare reform—a claim disputed by AARP’s executive vice president but partially supported by Congressional Budget Office analyses concerning certain legislation. The Centers for Medicare and Medicaid Services ordered Humana to suspend these mailings pending review. HHS Secretary Kathleen Sebelius cautioned that insurers engaging in deceptive marketing risk exclusion from new health insurance marketplaces scheduled to open in 2014.
See also
External links
- Articles with short description
- Humana
- Financial services companies established in 1961
- Companies listed on the New York Stock Exchange
- American companies established in 1961
- Health care companies established in 1961
- Companies based in Louisville, Kentucky
- Hospital networks in the United States
- Pharmacy benefit management companies based in the United States
- 1961 establishments in Kentucky
- Health care companies in Kentucky
- Health insurance companies of the United States
- Companies of the United States by year of establishment
- 5