Humana (HUM) 30 Oct 242024 Q3 Earnings call transcript

Good day, and thank you for standing by. Welcome to the Humana Third Quarter Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to Lisa Stoner, Vice President, Investor Relations. Please go ahead.

Thank you, and good morning. I hope everyone had a chance to review our press release and prepared remarks, which are available on our website.

joined morning Chief remarks a George Executive where will this Humana's Jim Q&A Renaudin, begin Humana's Jim and Diamond, Insurance President Officer; be President will of with Officer; segment. from brief Rechtin, session, Chief Humana's We Financial Susan and by followed by

latest number Certain uncertainties. I are discussed matters the in Securities XX-K, results conference call Before our SEC discussion, detailed advise materially. other advised participants risk our the press need factors discussed we Commission to Investors Exchange filings. they other begin and of in third the to with of call and our of involve could differ forward-looking with as read a discussed forward-looking XXXX along to earnings Form Actual release our risks filings our risks cautionary in and quarter statement. our and relate are this statements,

to future with financial our Investor today's any news participants obligation are references press site. Call financial common accordance non-GAAP are diluted earnings earnings measures update release, and publicly of historical explanation or per for are refer communications no these this to principles in generally the on to available includes with also that or conference SEC Today's should not Relations to made or during included in business measures press filings our share. or discussion undertake use of share reconciliations non-GAAP accounting that our accepted releases GAAP. per and release, filings GAAP note call Management's or measures We EPS results. address and today's and the financial statements our forward-looking regarding

today. the will purposes. later being call this available of page website Humana on Relations recorded is Finally, humana.com That Investor replay replay for be

turn I'll over call that, Jim the to Rechtin. With

be able you that and Lisa, discipline. that product basic to Those experience X first consumer again. Medicare the to us. and delivers over our we drivers quarter, business of is everyone. against good morning, In against joining over Thanks, with I need and are for a priced Thank last outlined providing deliver needs

operating This excellence. towards foundation Its capital deploying Medicaid. I'd that review highly office it really efficient and Second, in is Advantage of clinical fourth those its X results drivers. a complements with bit back industry-leading a and lens managing a core to growth around is focused the of Medicare third, our CenterWell but business a way the quarter's like margins. little really with

I few Before start me do headlines. a that, let with just

going we and that of exceeded First the are expectations the achieve for for in EPS to in full XXXX at sits also quarter. continue we as Exactly land of we and noted, confident number comfortable $XX is evaluate. We're all, we of largely a AEP where to on consensus we year, dependent will investment where today. EPS decisions that Stars least with we're

in targeting clarity to is address management. of of in Stars, the cost investors our we we We rest when product however, progression in balancing the May We with medical that an our will understand investment business, business. also XXXX. at investment also growth, we outlook Day say admin XXXX. the like efficiency And margin be would business near-term and cost opportunities the in investment expansion good Investor but for strategy that it's in feel to of looking more that the and to this, priced similar earnings XXXX, on we certainly, MA are multiyear

the to drivers turn for me a let X basic moment. So

individual delivering good XXXX. When product, couple is pricing out that right the that look that that that me things growth we're if investments we we a we're of incremental point attribute at also through Medicare So a with -- I pretty of product been growth our when feeling believe to disciplined let anticipate to delivering. others are believe now, a start to We it, continues product of are what this autumn, the but full our experience, this paying we about have we and reflection channel And us growth continue significant last for started back. we pulled that growth off. at is is of membership internal in time AEP point, sales year. in of in around we we've over the at has for course increasingly the some pretty have market emphasize year year a and our investments slowly X%. marketing those MA to in The -- made outpace we've year-over-year This growth channel. important gains made expectations us allowed our And

We year's track And this best-in-class the early finally, X is from it's This on what appear now service. experience while expectations. Forrester. #X continue generally we ranked sales were a we for in to health of AEP row insurer can be deliver with ranked being tell, Recently, Forrester. by by #X customer cycle in to years

driver, excellence. Turning second the clinical to

care we've been Let and to and our back do we is our for to of close align networks more that to quickly with the care. investors. and get also in patients in incentives and work call to We've member me and and also expect We've increase Stars. moving in redirected to related start results to to our that that care. We've our outreach expect gaps center pharmacy members ourselves acknowledged got now management that we make investments to and gaps provider capacity

making and care to like would allowed investments. shorter up capability. team's to to frankly, incremental And we're plan week, than I that to feel about focus resulted efforts primary X,XXX excellence on frustrated it, This simultaneously scheduled. We're also Just have also better a cost And that lower making another a last -- got take we've runway appointments. that way appointments and start about when we last care that we're I'd the X,XXX to ground technology primary to make the improvements week, this and we X,XXX And care. sprint effort learned we our impact impact I ground. Clinical good really characterize deliver translates night the those includes XXXX. ourselves about the in finder

And expectations. so and give be will costs trend. around There's obviously medical in in categories. with we dynamic, largely line with take some expectations environment our QX, still our across and medical cost are The is careful

success driver, back for from good third efficient The continue to and X spend still adjusted same is that time helping driver, extending to make give less in a and time cases much the XX human management, contracts year. that clinical the just office. and to We're However, are recently We this, drive kidney the decrease We AI care I'll growth. to they we're -- are that leading of beyond the about cost AI. would They like final more organization highly senior-oriented ratio doing efficient more a on management deploying argue quietly that area. point building documentation. That efforts. of right do our in oncology solution control primary been we example progress care generative of primary on cost launched operating uses some growth value-based now, And drive the to our disease in to any our into nation. is, example basis half give we've work allows all are oversight I for implementing a in documentation. areas for this care the but capital seeing team number to as results post-call we're care spending we're us use our seeing effort. Shifting expecting type brings care decision-making

Our experience are of a study on researcher in hitting VXX. collaboration with track and leading that Harvard clinical and their when the primary members It senior-focused recently mitigate both released We part have They're that value a care clinics clinical of a and their professor primary economic targets. they care clinics financial of are a to found our demonstrates clinic. the create. better

we're look encouraged this clinics to growth XXXX. quarter and that around, and fourth another will pretty time, expected to and a BYXX, that and and guidance our the by investments for how patient we acquisition to formal industry, critical and to which more organization call, the roughly trajectory to in our forward Stars long-term This impact Day, to May through is same also we've strategic XX earnings of demonstrated update underperforming making targeting turn providing an this rapidly at strengthen look add we continues expectations. I'm year. can performance value. our continue Often, is initiatives expect times balance on XXXX to forward outpace we in continue our fulsome the a drive progression. it's short-term We recognize our performance We dynamic shareholder think that by believe growth, we recent be I these Investor with absent at on their of again, obviously about providing clinics

just remains care. I'd our for say, we for the with Finally, positive look, value-based outlook Q&A. And regarding and turn high will MA to conviction that,

comes first Wolfe from with Lake Justin question [Operator Instructions] Our Research.

on or you you're that more spending in spending, I cut I of think your you combined you color the or what XXXX would growth, market say, Prior Number to years? to about investment a expectation about that seem year. X top Number given margin on, ask MA take. can investment a had in admin pretty talked flattish, with two, put and earnings just dramatically us income spending $XXX one. And for the of was wanted specifically the should give talking now last investment $X given next to your $X spending. that million, ballpark? on year-over-year, reasonable to improvement improved some over comments I to more call, that comments that at to this in terms spending line you're Is X give

to then of a there Is what Is to have or forward? over that improved think we you how going rolling Stars get have that you there where happen? And time nets And kind you're there going to what to it that does you? should back? stuff return be bring because frame about X overcut,

first So Justin, thank start, in. I'll X Jim, is jump then This I'll questions. you let for Susan and our

would And about be to So start saying are everything give here and recognize can. with XXXX. going now. that a we let right as going we're to to But saying to to XXXX in we're I as answer I try what Obviously, we months. Again, what guidance me like. just going few clear aren't be people I'm able not

a everybody I'd just told see thing essentially good we we're we reemphasize pricing we're XXXX performance we things at of our that, what our where that, feel even plant floor about incorporate and at we saying first bid, hey, a And the felt minimum, season, still is that we're exits. we The is, result about as with that you the performance our bid as we and look, reaffirming XXXX good floor, head is, after XXXX. since learned both our see a we've product. The meaning into

in room see What months few So words, other is we over to unfold there. for is how room we're also we next progression. saying some do establish much things need in the to have EPS

So next mix both where AP be as be whether of the and think thinking well we'll as and that member medical visibility member about results, can and confident count have think we final things, the better monitoring we you into the those more cost continued we year. trend, precise about

of quarter how telling we've to good ourselves We're on be footing to fact, with XXXX that and we just make into X, potential as have put that. long-term approached love prioritize we're we've earnings to precise progression, importantly, decisions. don't. going I we're would you We to do And can We leaning that going last similar going tell good you, with a got choices approaching also to to do where on but that better numbers all where near-term we that XXXX. over the in investments make floor. going to investments in to we're EPS posture a or are those

flux. still is of Some in that

making smaller doubling investments. as those we're actually generate see in returns, down cases, on some we we're them. And And

we're floor. What XXXX for we're the today. in you to number right precise decisions sure we do creating can but we're is telling a that establishing long make the have term making don't we so the that And room while

trying So things. balance kind that would everybody more again, two I on reiterate of really focus recognize And I to like clarity I want we're that to a do.

as right the things in things be the X can. Susan, appropriately that targets, really we to way add dynamic balance best hit would to I the credibility to we we the set over to the trying XX navigate that? expectations we're sure the want time, here through are to make and the establish try and Given trying to build months. targets, best doing prudent that mean, you market, -- what to we establish next those we're that's give

it operating I the well. about needed, that to only for both No, Justin, Yes. begun that are I we've is, thing The as says well, of think Stars you if investments got given level year-over-year. gosh, might also some benchmarking that we've of we concern, talk done. core add performance of work you backwards cause believe but increase the We and investments to some questions the that go could some

that give did to guidance needed of situation while and we think the like prepared us where we give the did to pricing sure just go I flexibility introduce a backwards. one creating in the room wanted these make So clear the might floor the 'XX, that that we're bids, to with not action we we that for it was make investments felt to formal that take 'XX reasons we made until that

of from with Our next question comes the Hynes Mizuho. Ann line

So trends than imply MLR Are in sequentially. your better they or were expectations? that this XXXX your results if a so, does your characterization? tracking what good for bids? Is mean And stable line relatively

Ann. Yes,

claims the like our inpatient business. in in through but geography terms seeing differences expected non-inpatient did we quarter. improvement of in of side terms were third with quarter, developed the total, claims on saw the as for MA expected third There some the commentary, in the year the of as seems in line in said deterioration current So for results development as total some we develop posting

we've would to assumptions across approached bid. to, risk within expected at also we we've the good some continue both the reasonable evaluate bids, As continue hundred trends and pricing. about in targeting in inherently on assumptions Jim But continue we time information the geography to feel the aggregate, quarters. guys feel claims been based few you feel our as year, least early the assumption. have our what we as continue membership to next emerging have we loss in mentioned, versus we within to to thousand a mentioned, we differences of Again, adjustment MLR that at to of continue as a how continue trend to around And feel prior talked meaning members the our like for access like confident

Barclays. of the Our line next question comes from Andrew Mok with

that you're to X% where wanted to that XXXX minimum thinking the is investment sit target? on deliver elevated in the target I And you the spend margin recovery scores the up about your realistic bonus in and of a Stars how follow context a with that there Stars mind that and target. One, level have is today? on goal

So want to I I the sure captured make question.

this back let So just play real me quick.

what realistic said is that basically, does then this is what on target, target margin you that think right? around point. And progression Stars I focus XXXX a X% assume at

to on order to in minimum recover that deliver a need you there Is level target?

Yes.

going my talk X% on out realistic, of and risk mouth a little I'm that look, to -- there this, of number. both X% bit sides is So is to

just super not. clear. the doing everything we will to We're to there get we or that to in possibly point. in after going so light of yes, And And can we all want XXXX get Stars, We're be there is whether way risk to it.

have you're add? would business some meaningful in But on to there. Susan, that specific progression way I would takes progression yes, many We're put make specific the have There not variables and get on to is make the too in Stars across a We puts it. going to different number to it. you try putting what a meaningful number are to Stars describe to it.

the all the that. Andrew, year, I thing, important. Yes, environment, those rate will that every And obviously, say that, other environment, the agree competitive we then are things as be also

headwind. 'XX know, have we'll that then, you versus be us, IRA guide very year As where will a hopefully, 'XX good the at is point, behind

some is the we'll that these there where there that recovery. additional talked take to that some continued an do been over but just would we've consider. And of will And returns investments we I should time about to terms those margin that we've that so which be -- off discussing now environment, are then frame of in have margin, room support pay variables hopefully, say also have

Hendrix the RBC Our of next question comes Capital Ben from with line Markets.

You flagged the costs non-inpatient the higher specialty drug quarter. within utilization for

your would there for component you utilization -- of year. peers as Is there assume would priced headwind pull MCR XXXX? some of head a Or One as we noted of next something forward is a that Part a D for expect drug be changes we specialty that modeling should into ahead

yes, Ben, September. at something we call conference seeing costs, oncology early said, that in at I we out was see some in higher particular. did as I did you that were as a

a exposure. that So not that been minimal IRA really is of bit. 'XX we they sort seeing out-of-pocket member have largely We say in it relatively of would for our changes, view terms attributable were in it to is

so we so have believe new market what seen that label attributable it's to treatments we come is or either around expansions And existing have far that to mostly treatments.

unit we're what these new in and the pipeline. do out in the maximum and pocket. seen is, lower we much being the anticipated therapies, historically treatments IRA as evaluate that resulting to we year uptick of the We higher trends some of will just had given than And introduction net anticipate are than some see next further added seeing you existing costs we've in higher cases, changes

so our well the we just, assumptions new of thinking and induced therapies. around expectations And as 'XX again, of sort emergence as continued utilization have built into some in uptake

exposure to 'XX, early our approach more expect side that in that -- can more is there of light how we said IRA. on IRA, start in with relative take terms of some the Obviously, we'll is why things guidance that. trends can thoughtful around considered we'll of expectations these in a which see we the our have you we So plan emerge

next Our with Fitzgerald. question Cantor comes Sarah from James

wondering if given and Stars think XXXX, what in you how where is was overlap they on that? in planned crosswalk how clarify I MA possible implied ratings. then much you stay your about geographic guidance, margin is are, 'XX if could And

Yes.

the do the question take to take I Stars George, can So you then and MA margin question? want

for thanks Sarah. the question, Sure.

other think we as that we'll in lots crosswalk So of with possibility, about evaluating the be things. line

will, the to be concentrated So we of we making in thinking one the that progress work into derisk we group Stars cycle. we regard we're certainly about have want and course, And our certain be current through how next as of as much that we're the the doing thinking of opportunities go have contracts, we'll with as that in for Cross amount that contracts. members considerations the to well bid

a 'XX management, membership that seeing we're considerations that number are hand we there as looks we'll be and our well like membership medical progress as in some So the items. of into other taking what do when in mix cost

So I of number There go about means. it year. into but we the levers certainly are any efforts the that a exploring it we'll that don't issues mitigation of our by about thinking go as be we as is through X sole be next is Stars think thinking we'll

'XX MA specific given we Yes. far guidance And then, Sarah, as Jim some margins, commentary. haven't any provided yet. as obviously,

margin MA within absorbing we XX% headwinds VXX, the we because margin take TBC including all within acknowledge expectations cetera. pricing limited about of we expansion I'll those the have 'XX, were you, just higher talked of on filing the that there threshold, trend the that So et that the would the TBC because side, mentioned. our our I just after previously pressures remind emerged as IRA, 'XX given was true ability And of to offset the bid,

unprofitably, decisions had progression would feel where we didn't to the largely emerging or continues mentioned them about the That how be come and that pathway So to the still continue levels. margin those performance contributing we and a historically to good of in reasonable we like trends majority the profitable case. Again, performing thought the we exited we aggregate. the about trend achieving plans we pricing we've would we to from of had getting had exits plan be seen, were feel that all

As some are The allowed we action we investments. do pricing Jim some contemplating morning, those mentioned us to additional now though, that. flexibility this took

to other when things But we've comes level make within as inherent certainly, established of we guidance. the our of membership And in, again we'll floor, how margin and talk relatively guide. the more margin up as growth obviously, of so have comparable. the will investments flat, to least a choose we notion set do at be end ultimately, evaluate we close to what can we a And about variety if

from Research. question Our comes Joshua Nephron Raskin with next

that total you that we sort going back But lives a lastly, MA losing lower the growth to are seniors lost on Do plans, less but And that or levels, where answered And thinking X Susan those the you then going? larger Is smaller retention exits? exits outside assume benefit I market or fee-for-service. market you have from about just this, think does of in had have that do they margin. you're view lower are you are do of X how And should rebates? mean plans you for then XXXX? lives -- think think going people those

Renaudin. George I'll it's take question. the Josh,

we the saw roughly this this year year we coming overall the and X% thinking X% finish as are growth, out on the X.X% performance industry So versus year. X% in expecting are our to that we industry the

about is to our bids. is good the And competitive growth with time very think of that where line about So much pretty in thinking we if from. at feel come it we our going positioning,

our that. a that We're that. of work about there's helping members then continue focus feel of to retention, a pretty few From standpoint lot we're brokers. doing said, as 'XX, We anticipate, to Susan a X,XXX we in good on

of course, and As be a of plan you county the to lot exits, there's, think about going shopping.

the work those help and so both tools make consumer shopping experience experience it's And sure have better customers. we sales of brokers for put sales through -- our teams, lots to a outside our to the internal in place

fits that allow team more put of decisions things they make into better plan have so with with so needs with help also in helping we capabilities, that our in And them a the And access tool members to AI benefits, help put their needs fit we them a better. choose including [indiscernible]. them real-time to place internal best place those can

and us I we of would just our this, our Jim say another and mind, handle in about some keep new areas digital very that exits, on that trying a sales are in we and tool that out retention a item have from also think results I the find members comments another that's of are positive getting do those seeing made our who to choice. in planned digital exit members opening comment is allowing sales to we're did into in XX% better as those focus because

as So seeing were is them significant will digital that lead happening increase sales choices All those retention. make the digital result. to tool the helping of amount a easily, a in and increased we're very

to they in redetermination where thing impact keep the industry one I'd on still growth. points, given is it's that do about in worth we probably period, process we some have XX see eligibility. for George's continue will the to MA growth think We Josh, the deeming ongoing 'XX duals comments attrition then, will particular And believe from as some the to in basis add mind side. lose thing One the on

I how depends. your lost it the say of about would contribution think terms question of about to In lives,

by for plan exit, those impacted are always the said, members unprofitable. we've As

contributing. that So available because to we don't the incrementally is them that the positive To most plans do positively retain other them, options because would degree is we that positive. of mentioned, retain them, those have George are as degree be plan

you did our try were we that work those did be is we Across hard so 'XX you sure if it going higher-performing our to larger benefit see bids, and targeted very cuts where higher-performing the to we taken action rest make our below plans intentionally of would and margins. as those plans the protect less in have remember, book, to

that So plans. we'll we our see attrition AP obviously, out. within to would how more hope that is be see, within the lower-performing the come it the concentrated But results have

beneficiary takes As longer to the know, to a plan, CMS has enroll it give us. because it and you information has to in process attrition another to see

that So visibility just but we have real watching into closely. we'll no yet something be

next comes Stephen Baxter with from question Our Wells Fargo.

expected. about the rule the Can inpatient a bit tolerate higher broadly, unit you inpatient what little just you that Medicare with came of commentary than in a you in mentioned unit midnight think And about just saw quarter? how of talk level of cost maybe ability to the better X XXXX You more in the XXXX? then costs

yes. Stephen,

see just consistent as has been was durable seeing up continue stepped the So fully we're has say had up seeing And we've the in seeing you until to that emerge with team further we might meaning were somewhat what and been sure would make relatively that we ultimately I'd seeing were proven continue. of consistent, year. over recall, be out what unit to costs if course be that. cautious early, what talking we we to to in really run about lower retrospect, the inpatient And fully stepping to that

well. So see say, to some we're be feel itself, the about of seeing. I'd respiratory cost, as the included within good we what we that unit which tends third seasonality, start flu lower quarter in to average which be and would also

'XX, of incorporated our the all right, always for way that of baseline. we've approached In terms into got is 'XX said, we've as the impacts, we've

rate trend higher unit the the for normal non-inpatient, final across reimbursement, for changes is that obviously we've jumping in now all we've lower embedded cost, that and thinking as have inpatient assumed geographies, seen the so is With our changes 'XX. a then now got We off in our the from estimates. point and CMS included 'XX for

on what based we've so mix of And what be we're feel into changes. XXXX. is we to seen, say consistency exposed we've unit the and cost really about good But what any I'd about we'd how trends seen thinking

question America. Joanna Our Gajuk with Bank from of comes next

I to Steve's different similar question angles. a guess but I from guess, question

talk traded guiding well you 'XX still or utilization average obviously volume volumes, can been So growth instead just year average, the trends the companies growing not just hospital unit of in costs, after publicly this of about above terms from for hearing some again in companies cost. talking because we've about above of

the it of for can outlook currently scenario assuming pricing that comes you on your curious kind happening this what XXXX is that consumption. then question when grow EPS So is to you that utilization? And you are based in in

might our the that as of remember, we're from sort what we just in terms additional so role. X very assumptions time, second lower service in terms midnight a quarter shift results seeing line step are that some of of Joanna, based to much on utilization of At utilization, did site utilization and estimates in call. we we our seen since of updated have you up related non-inpatient standpoint

utilization has hurricane the you've we that very been line to utilization, with much core but impact, identify our Our season, those good things things we about. can that since. Obviously, respiratory discretely in got continue like feel

first consistent as of utilization well. the have been Our impacts very quarter coming out management really

good about those So we trends. feel

that within on 'XX, higher bid. In sort we've that of assumed our terms is of normal inherent top utilization trend of 'XX baseline,

were level regulatory we incremental for large create should there's of expected 'XX. for And like dealing so this with XXXX again, that change no uncertainty

making in think feel very churn. assumptions the good we're of secular sort utilization I So about of terms

next Our with Bank. question Hill Deutsche from comes George

increase publicly at was rates. margin traded that hospital denial topic last inpatient bit second XX trended hospital talk have in and how little of I months? lot topic. about the a about denial the claims different the quarter, and know over up a rates the talked a came private kind in guys A companies companies they've and appeals Can claims an claims of you of

So see any claim not meaningful impacted meaningful any and -- there whether call denials trying trend just I'm way? out if like there's or to have in MLR to if

yes. George,

the implementation, saying, with initial we've we more So X midnight rule in -- approval. that result as had been

you fewer So expect in would theory, denials, appeals. fewer

when appeal rates performance. see based mentioned we higher historical we on rule throughout rates expected and was than midnight implemented, year, would we As initially for have those uphold X did higher the appeals

a appropriately validated the there about, evaluating which that audit, And would would which ourselves. providers the we come we of the in tail And reasonably clinical you've completed been appeal. see at repeals pull a a As fewer appeals mentioned, in what seasonality is, we're future would rules. can question there's that long was was we've and we say how because audits just the time, forward through over in? change We've a believe CMS is

the and we seeing and first We uphold into made the coming in early rate. higher just We quarter. assumption would we been result that ultimately, to out appeals would it incorporate have is just caught say date. That of our estimates what that overall

not the assume appeals why be then And rate those when I payers different initially still the appeals hospital seen just systems year-over-year. trying commentary just being higher, comparable everybody understand and you that and rules absolute have recognized that the we've how some just may that is what which may quickly is think of think they have to seen applied it's been the the across higher appeal magnitude from may you be have those and changes, hearing as providers. think are would about I new

very what and I seen you to quarter add would first since. And the we've don't George, consistent So with since then that's, anything? want no meaningful if know I say, variation

at that of are the would question to think out I Yes. be appeals X confident the add testing that came just Susan, applying out said, start how very and exactly applied. about seeing had will given the where CMS of rule you how as we're the the audit We, midnight you're feel about year trying very right I positively. they we figure

to clear to of speak all to make issues the have similar rule sure a approaching I clinicians that way thing the provider is is talk of everyone with not. would just the continue our to many clinicians add midnight other we in is that that and is what through The X understanding

me seen pile stable together. all on to wrap relatively quarter, think is but to we're Not convey the here Broadly, we've quarter, trends. just I first what since to late early stuff try trying let second inpatient that

was fair third And so there quarter. in of a noise amount the

everybody the think change. was I adapting regulatory to

lot a gotten And place. at we the approach it have and For attention through that relatively and in to stable whatnot, us, worked of a changes and in put point think on we process all time. we

inpatient feeling quarter. relative pretty et be, the utilization, about to forward, good cetera, first ability the to cost is look we what when were project So unit denial to and the cost, where rates, back outlook that's going we're we our in whether

Our Partners. with next Leerink question comes from Whit Mayo

it question Maybe as Stars on just a lawsuit appeal. relates to or the

with the Just improvement Part from D center here a and doesn't ratings you it like category, the bit to X C age need on might both can get contract a a looking to contract. like flip rating that a It at one like XXXX, both. it on you maybe math little it seem do just the back seems call seems in X-Star to X is to but off

like improvement And is wondering overturn would helpful. categories. how So we is it are to calls I'm see just talking calls? to in any ballpark have many about multiple color One, statement? Just be accurate that to an either

to we Yes. In the it's see calls would across X overturn. metrics. total, yes, both need calls And X

Jim, add I that, would just into bit.

other the X with is and into of need the visibility calls, calculate. pursuing X CMS we're In that how to the greater to things addition that are the threshold we for transparency talking

is that Yes. correct. Yes,

A.J. comes question next Our from UBS. with Rice

make Just on 'XX. I thinking to the sure understand early want

your on need the you in a litigation, the sounds cut CMS If you had are investment this view appeal on would very Star change amount has of that It Stars arbitrariness point, the 'XX. the through threshold to high track And in up of successful that. almost hit you your like having of around of some discussion ratings the great around the and been ratings. points Stars record

guys about a as if And for 'XX have think better? sudden, back like, the not on your is in the you make then Stars. to of would it looked your And you need discussion an investment now about But for I appeal off of margin. focus enrollment a commentary that lot view X% to over always trading of out And getting lot any on margin. 'XX. that taking for margin to years end about enrollment back And sounds next broad back is Now up all of change successful, you discussion you philosophical if a would years, wonder there's at the appeal obviously, of to how to that? outlook we've do hit on have you to get got to a track this, with much a might get X% you unsuccessful couple the

Yes.

how with start and me its on XXXX. let the So we about impact think appeal

way things. is different So there's think but Stars related slightly X the to about

cut similar Stars on litigation, the X are broader metrics of I way that So our whole or we're single comment what -- to the can the trend is That a one difference its between that, bunch through we appeal guess different there's members. the X have. kind of that is And of but that across and related is and X.X Stars thing that's harder. metrics. thresholds getting the really working separate But program beyond within a points lot of

to causing industry program I there's to keep with those think have to while think points we're you critical movement. broadly, do one and a so investment pretty for that BYXXXX, much that I can And up lean is metric you far is everybody in cut make to metrics don't with and in how metric that at the entire reevaluate alone that. -- movement into looking thresholds this sure

that drive for anything So investment. the -- pace we performance the as going kind on about the how expected at really add to day. George, would better what investment is the is if of going to investments about meaningful impact broadly you The to program next don't would we in contemplate year, a of that? at previously. -- appeal is any and the the better That's you I better investment what not -- end we exceeds have think and

also add, thing for is in We're outcomes the a in Stars customer and the in in improve many our making overall. programs talking we're health investments investments other Jim, about gaps good our our I that making provider is incentive ways members experience. we're to to helps enhancing just while the care, about It member outcomes The which excellence continue their thing for into to thing the our them and also right many health has moving performance. comments to to finally, would close and improve opening earlier other about, to in doing letter. need we're focus and talked the his Jim integration improve us with operational technology vendors nicely things support strengthening to performance. And our with that relations work to on his in both we forward of around fold that the improving

we then, investments XXXX. A.J., is about Yes. remind I'd other you only And talked the thing for

just are keep referred making had of broadly Just improved areas a drive there Stars investments mind, is that across one it in more but performance to Jim we're of operational piece number to.

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mean know that practically? does We yet. don't what Now

that to We out. have sort

with comes Windley question from David Jefferies. next Our

I wondered fronts. on two

growth versus recall expected AEP, year address and kind 'XX that any for as then issue of wondering announcement. what 'XX. of you expectations should to more members relatedly, early much about last done therefore, this you've early on some being brokers next rates the about consumed low, were membership for And how investment. relatively lastly, have First, just touched AEP thoughts if on or I'm of intra-year. to talk I already. the we by the cadence year, new I'm channel helping after couldn't AEP think Basically, wondering in shop and that shopping discussion was existing that you've resulting members more

Yes.

we've going for the for to the change through about well. member as be County So things dynamic we of what number are where reset number number a there are in there's a was disruption of question, exits, preparation in to I'll have we're done benefit as start, industry with sales David. that that talked knew thanks in industry a all the and given we going changes, view had planned competitors -- There a going our we've be have

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I So channels investments internal sales we as digital make our improvements in, to self-service options. include before, to mentioned both continue in

We external also help making our brokers. investments to are

You large that internal we as a brokerage internal also sales XX% seeing pretty have brokerage a in channel. realize well, we're in increase that

from service external the and this partners leveraging well team with at they providing helping as AI going and on tools as best can be more those able questions our by and in choices. both digital, improving experience the them them our real-time them giving data benefit to better helping improving are in information how when sales sell calls we're to person, for answer So gets members in those

we're of So this across we doing going host knowing be a of that marketplace the that are prepared whole to year this is there's in significant a pretty for, things whole change AEP.

been our what that for headline that the really that building kind internal important me channel we and reason. and is And just our control have that of internal most very to important over, we've direct strengthening partners Yes. external us very also us. and building And in to let channel are is capacity channel

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I last IME be. We really And it's then say we like say phased 'XX in. XXXX predict we just to can't would question going hard rate, have I still which, and David, to what think be was the to -- around would it's

within big will that And we impacts. are those seen, trend the 'XX know some assumed their the 'XX forward-looking the we recognizing positive question we see trend So rate will restatement have embedded some rate, had be, hasn't may the that's does they suggest reach by seeing. that of of be obviously these is trend well. of one That indicator detail of kind are as some which shared they CMS transpired. The trends ACO improvement, sort given seeing

the rates think appropriate optimistic for absorbing. include we're an next the year So that cautiously I for will we're all trend that adjustment

Ha Michael today come Our the Baird. of will with question last line from

how is, it make right just sort late Just likely time was a conviction? confidence, it left of how to it you in XX% XX% level now those are tracking and snap you your how you're XX% into being of realizing guess, given very realistic firstly and 'XX quickly that you bulk industry to confirm. On still already I year. redetermined? XX% number have, next into redetermination, roughly I it, expected D-SNP through Star given CAS mention Susan, are growth know that actually, to be those period grace months October's What headwind Is they next other because or able What's is of fully improvements? cut based guess, yet those plans? percent weighting call to the on of likelihood I year, fall sprint but plus X-Star the expected more let's aggressive I in points being presumably to guess did but off released bsp what's members are guess, lives incremental that now of the ratings. XX Or how two, to 'XX I on still your you're just know CAS run of the reduced. late book? And measures have lives specifically, of X-month of the I are to the measurement then back XX June, XX% is for

we or George Sure, and process redetermination complete. in Jim heard Michael. question hand yes, points over it the in as of that ability that because as There pressure the first of we less which do headwind the points Star On a in D-SNP, Frankly, was slightly to question. you 'XX about we in well, correctly, take confirm disruption, and 'XX will as the eligibility. is of for disrupted basis Healthcare think then 'XX, part anticipate XX the basis so would 'XX. say, I'll to it XX or Change pressure

seen though is even period impact the we've the side, deeming MA that X-month of Medicaid so And because on there the the period. largely on side,

so coverage. And that additional expect disenrollment dual do they see lose we will some as we

our to expect those of recapture some within obviously Some are offerings we but no eligible. non-D-SNP longer would

terms expectations to all me or 'XX thousand you yes, you is But in then that loss of built did contemplated. for hundred we've the correctly. And hear that into Stars the want question? Jim, So of George already take a few do members our along

just jump own just visibility got that. at even got industry The performance. you've answer no point, performance into in and on I'll is, your Yes, limited you've visibility short one, into this

to to play not of And feel it into think exactly are we're the setting while as an understand We need and to is organization things comment are higher, point about performance going on that year. On heavily thresholds, X.X those resetting as goals. towards those feel we they're performance, expectations to making are as leaning so we expectations And And industry good actually like going higher that how we're we go the progress we good all I there time cut a progress can, out. months, in driving still risk, own months so year, or out making. we with next our X

a to not everybody question is point what is it. clear into we need that super leaning there's this And But -- answer in now. the at time. just it's So right

and our being interest everybody members. this trying what in for to Humana appreciate serve associates appreciate everybody last you're that thank those And do and those we your in and going transition day. I'm in and to just for want who to thank question, serve joining us the thank they're giving I We With doing, here are every the patients and XX,XXX the that we us. morning, that work members our to our patients support and

So thank you.

you Thank concludes for This participating. call. today's conference

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