Humana finds profit growth in Medicare plans

Humana, Louisville, Ky., saw its first-quarter profits climb 62%, helped by a 19% surge in Medicare enrollment over its 2004 year-end total and a tax-related gain of 14 cents per share. The company also announced plans to expand its Medicare presence to 46 states plus Puerto Rico within the next year, up from the current 15 states. The Medicare offering would be limited to a prescription drug benefit in 11 states, the Associated Press said. Humana earned $109.8 million, or 67 cents per share, in the quarter ended March 31, up from $67.8 million, or 41 cents per share, in the year-ago quarter. Revenue rose 3% to $3.39 billion. Medicare enrollment increased 72,700 members to 449,900 as of March 31, including 50,400 members gained in the February acquisition of CarePlus Health Plans of Florida. Total medical membership stabilized at 7 million members, as Medicare enrollment growth offset a 3% drop in commercial membership since Dec. 31, 2004. Humana raised its 2005 earnings-per-share outlook to between $2.23 and $2.25, up from $2.20. -- by Laura B. Benko