Humana Insurance Anaylsis
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As a Fortune 150 company with a 45-year history in the health industry and more than eleven million members under its wings, Humana has become one of the largest health benefit company in the U.S. With its slogan, вЂњGuidance when you need it mostвЂќ, Humana has gain their success through their diverse business units, outstanding wellness program and reliable customer service. The company is basically operates through two business division: government and commercial. The government division serves everyone who is enrolled in government-sponsored program such as Medicare, Medicaid and TRICARE. On the other hand, the commercial division handles employers groups and individuals under fully insured medical or specialty medical.
During the last decade, Humana has undergone many major changes, all of which have boosted the overall companyвЂ™s performance. Humana current strong market position has much to do with their massive acquisitions and strategic alliances that took place within the last years. Their strategic alliances with big companies such as State Farm and PGA Tour and not to forget their partnership with the government have certainly widened their market scope as well as their products and services. Currently, Humana is actively conquering U.S. and Canadian market; however, they have also started to go global through their subsidiary in Puerto Rico where they provide military personnel serving in Puerto Rico with healthcare services for themselves and their eligible family members. In addition, Humana also have been innovating their product and services in order to better serve customersвЂ™ needs. In 2006, they quickly took advantage of the rising technology and internet use and established online based self-services called MyHumana and SmartSuite. This innovation received very positive feedbacks from the customer and again, pushed Humana position in the market even higher. On the intangible side, HumanaвЂ™s strong leadership contributes to this successful growth. In fact, HumanaвЂ™s CEO, Michael McCallister, was named by Forbes Magazine as the third best-performing CEO for his pay.
Nevertheless, Humana still needs to carefully pay attention to their competitors such as Aetna and AMERIGROUP and continuously improving their standard. Currently, there is a price war going on in the HMOвЂ™s industry which pushes Humana to further adopt a lower pricing strategy in order to steal market share from its competitors. In addition, the HMO industry is considered as a high risk business that might derive potential lawsuits and negative public opinions. Humana needs to practice their business legally and ethically. They need to keep reminding themselves that customer is their main assets and it is very important for them to always put customer needs on top of everything else.
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Since the case in 2003, a lot has been going on for Humana Inc. In 2004, Humana Inc. initiated its Humana Military Healthcare Services (HMHS); a subsidiary that provided military personnel serving in Puerto Rico with healthcare services for themselves and their eligible family members. Also in 2004, Humana Inc. renamed and re-marketed its Rx Impact Plan. This plan, renamed from Rx Allowance Plan, creates an allowance for its clients instead of co-pay. The impact of the plan is to force clients to really understand the impact of their prescriptions on their wallet. The goal of this realization is to open customers up to the other, cheaper prescription drugs that are available. One negative attributes from 2004 was that HumanaвЂ™s stock price suffered a decline. However, this decline in stock price was felt by all HMOвЂ™s in 2004 and can be argued that the decline was not a result of HumanaвЂ™s business practices.
In 2005, big acquisitions and alliances took place that really launched Humana Inc. and enabled them to gain a wider customer base. The strategic alliance between State Farm and Humana widened HumanaвЂ™s customer base by 7.5 million people, allowing State Farm to offer their customers HumanaвЂ™s Medicare Part D prescription drug plan to eligible Medicare