Humana warns that rising care costs will persist through 2024, surprises Wall Street with forecast

Humana surprised Wall Street again on Thursday with a lower-than-expected earnings forecast as insurers that sell Medicare Advantage plans continue to struggle with rising care costs.

Shares of several health insurers plunged in early trading after Humana said a spike in care use that hit late last year likely will persist throughout 2024. Humana also debuted an earnings forecast for the new year that fell more than $13 short of average expectations.

Health insurance stocks tumbled last week after Humana also scaled back its 2023 profit expectations due to those rising costs.

Humana said then that its Medicare Advantage patients used more inpatient care than it expected in November and December. The health insurer also saw more growth in care that doesn’t involve a hospital stay, like doctor visits and outpatient surgeries.