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2Annual Report 2006 5
ASO
Other Fully Insured
Portfolio
Individual &
Small Group
Consumer
Fully Insured
December 31
2005
Commercial: Consumer Leadership
is a Competitive Differentiator
Given a diffi cult Commercial pricing environment,
our leadership in consumerism is enabling us
to break free from the “commodity pack.”
Continued expansion of our consumer-focused
offerings, with parallel growth in ASO, individual
and small group plans, will contribute to
Humana’s growth in earnings in the Commercial
segment. Our ongoing success will focus on
these primary features.
A broad, balanced portfolio. Membership
in Humana’s ASO, individual, and Smart family of
consumer health plans now represents more than
50 percent of our Commercial business. From the
start of 2004 to the end of 2006, membership
has grown in each category.
• In ASO, membership more than doubled
from 712,000 to 1.53 million.
• In consumer-choice products, membership
more than tripled from 116,000 to 438,000.
• In individual products, membership more
than tripled from 55,000 to 183,000.
Consumerism. As the market increasingly
views consumerism as the answer to rising
costs, we believe our unique, comprehensive
approach will take hold more broadly. By
uniting product design, fi nancial forecasting,
clinical programs and consumer engagement,
Humana’s Guidance Solution delivers sustainable
employer cost savings and provides consumers
with a superior health-plan experience. Growing
evidence indicates the approach is working. A
four-year analysis of 231 companies and 219,000
Humana SmartSuite members (from a range
of industries) shows an annual medical cost
trend consistently in the 4 to 5 percent range,
improved drug compliance rates and enhanced
use of preventive health care services, all with
the employer/employee cost share virtually
unchanged. In our view this is real consumerism,
and it represents a long-term competitive growth
advantage for Humana.
Transparency. Humana is ahead of the
competition in bringing cost and performance
data to consumers, who need this information to
make educated choices. In reference to Humana’s
current and coming-to-market transparency
tools, a Towers Perrin health care consultant
recently remarked that Humana is “eons ahead
of the competition.”
Commercial Medical Membership
ASO
Other Fully Insured
Portfolio
Consumer
Fully Insured
Individual &
Small Group
December 31
2006
Our leadership in consumerism
is enabling us to break free
from the “commodity pack.”
Continued expansion of our
consumer-focused offerings,
with parallel growth in ASO,
individual, and small group
plans, will contribute to
Humana’s growth in earnings
in the Commercial segment.
Portfolio is 100 to 300 employee-size fully insured groups