Humana 2005 Annual Report Download - page 7

Download and view the complete annual report

Please find page 7 of the 2005 Humana annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 128

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128

200,000
0
400,000
600,000 Medicare Membership
2001 2002 2003 2004 2005
2 Annual Report 2005 5
Seniors’ direct purchase of MA plans is on track
while our large PDP enrollment offers a great
opportunity, over time, for interested seniors to
obtain both administrative convenience and
better value by integrating through one company
their prescription drug coverage and other
medical benefi ts.
We’re aware that the transition to this program has been
diffi cult. Like the rest of the industry and CMS, we’ve
worked hard to satisfy an enormous demand for products,
services and information that has gone well beyond what
was foreseen when enrollment began in November. Since
the initial wave of enrollment, problems are beginning to
subside and we anticipate will have decreased appreciably
by early in the second quarter. What’s most important
is that despite inevitable issues arising from making 42
million Americans eligible for a major new health benefi t
all at once, the overwhelming majority of Medicare
benefi ciaries have gotten their questions answered and
their medications when they needed them – and have now
begun to save substantial sums of money on medications
many of them could not previously obtain or afford.
Looking ahead, we expect to continue to invest
aggressively in our Medicare expansion strategy
throughout 2006. We’ve begun preparations to fi le
bids on products and geographies for 2007. The fi rst
step in this process occurred on February 17th, when
CMS published 2007 Medicare rates for comment. We
anticipate that once the rates are fi nalized in early April,
we’ll be able to adjust our plans and benefi ts to further the
growth and performance of our Medicare business.
There will be some differences between 2007 bidding
and what we experienced last year. What we expect will
be the same will be our continued distribution-partner
alliances and basic product structure. What we expect
will be different includes:
• Our developing national brand will drive membership
in 2006, and word-of-mouth advertising by thousands
of new customers will further drive brand awareness,
• We’ll have claims experience from our early enrollees
to help us adjust the premiums and benefi ts that make
up our value proposition,
• We’ll fi ne-tune our approach to each of our
distribution channels, and
• We’ll have more consumer research.