Humana

1961–1983: Nursing homes and hospitals

Lawyers David A. Jones Sr. and Wendell Cherry founded a nursing home company in 1961.[5] The company, known in 1968 as Extendicare Inc., became the largest nursing home company in the United States. In 1972, Jones and Cherry sold the nursing home chain to purchase hospitals.[6] Humana became one of the first two for-profit hospital ventures in the U.S. along with Hospital Corporation of America (HCA).[7]

In 1974, the partners changed the corporate name to Humana Inc.[6] The name was meant to change public perception from 'warehousing' or indifferently treating people to providing a higher level of human care and, by extension, more humane care.[8] It grew in the following years, both by business and in 1978 through the takeover of American Medicorp Inc.,[9] which doubled the company's size, and grew into the world's largest hospital company in the 1980s.[10] During this period, Humana developed the double corridor model for hospital construction. This design minimized the distance between patients and nurses by placing nursing support services in the interior of the building with patient rooms surrounding the perimeter.

1984–present

As the American health care system changed in the 1980s, "one of its hospitals in Arizona lost a contract with the largest health-maintenance organization in the area [and] Humana created its own health insurance plan."[6]

In 1993, Humana had become the largest hospital operator in the country, owning 77 hospitals. Humana executives spun off hospital operations from health insurance operations to create Galen Health Care. The following year they sold the 73 hospitals of Galen Health Care Inc. to Nashville-based Columbia Hospital Corporation of America for $3.4 billion.[6]

In 1998, one year after Jones had stepped aside as CEO, United Healthcare made an unsuccessful attempt to acquire Humana.[6] Humana pulled out of the acquisition after United stock dropped $2.9 billion in value.[11] In 2001, Humana was a cofounder of Availity.[12]

In 2005, Humana entered into a business partnership with Virgin Group, offering financial incentives to members for healthy behavior, such as regular exercise.[13]

On November 16, 2006, the Centers for Disease Control and Prevention (CDC) and Humana Inc. partnered to expand on traditional private-sector approaches to population health management.[14]

In 2010, Humana bought Texas-based Concentra Inc., which owns urgent-care and physical therapy centers, for $790 million, effectively returning to healthcare services.[6] In May 2011, Humana announced it would be using mobileStorm to transmit protected health information to patients.[15]

In March 2015, Humana announced the sale of Concentra to private equity firm Welsh, Carson, Anderson & Stowe and Select Medical Holdings Corporation for about $1 billion, with proceeds to fund a "$2 billion share buyback program and other corporate spending."[16]

In July 2015, Aetna announced that it would acquire Humana for $37 billion in cash and stock (approximately $230 a share at that time). Aetna and Humana shareholders would own 74% and 26% of the new combined company, however the merger was blocked by a federal judge in January 2017.[17][18] In February 2017, Aetna Inc. and Humana Inc. quashed a $34 billion merger agreement after judges ruled against the merger for a second time.[19]

In July 2018, Humana joined two private equity firms in the acquisition of Kindred Healthcare. The deal provided Humana with a 40% stake in the company's home health, hospice and community care businesses, called "Kindred at Home," for approximately $800 million.[20][21] In August 2018, Humana announced the creation of a digital health and analytics division called Humana Studio H.[22]

In December 2019, the company announced it would acquire Enclara Healthcare from Consonance Capital Partners and Enclara management.[23]

In 2021, Susan Diamond, formerly occupying an interim position, was announced to be the new permanent CFO. Her appointment to the position comes with the company's focus being turned towards the home healthcare business, acquiring in April of the same year a 60% stake in Kindred at Home, an in-home care and hospice business.[24][25][26]

In April 2022, it was announced Humana would sell a 60% interest of its Kindred at Home division to the private investment company, Clayton, Dubilier & Rice, for US$2.8 billion.[27]

In February 2023, Humana announced they were exiting the employer-based commercial group insurance market.[28]

Sponsorship

Humana is the presenting sponsor of the Grand Ole Opry[29] and the National Senior Games.[30]

Since 1979, Humana has been a principal sponsor of the annual Humana Festival of New American Plays in Louisville, Kentucky.[31]

Humana was a tour partner of the PGA Tour beginning from 2005 to 2015.[32][33]

The Humana Distaff Handicap is a Grade 1 race for thoroughbred fillies and mares, four-years-old and up. The race is run each spring on Kentucky Derby day at Churchill Downs and set at a distance of 7 furlongs for a purse of $250,000.

Humana Military Healthcare Services

In 1993, Humana founded Humana Military Healthcare Services (HMHS) as a wholly owned subsidiary.[6] They were awarded their first TRICARE contract in 1995, and began serving military beneficiaries in 1996.[34] From 2004 to 2009, HMHS was the managed care contractor for the Department of Defense Military Health System TRICARE South Region.

In 2009, HMHS' Managed Care Support Contract was awarded to United Military and Veterans Services, a subsidiary of UnitedHealth Group. HMHS protested that decision and the Government Accountability Office upheld the protest in late 2009.[35]

In 2011, HMHS regained the five-year contract to administer medical benefits to military members and families in the South region, a contract worth $23.5 billion.[6] In 2018, this was moved to the new TRICARE East region during the TRICARE regional realignment.

On December 22, 2022, the Department of Defense announced the award of the managed care support contract for the TRICARE East Region to Humana Military.[36]