Humana Expands Primary Care Network with 30 New Centers in 2025
Humana, a leading health insurance provider, has announced plans to significantly expand its primary care network this year. The company aims to add up to 30 new centers under its CenterWell and Conviva brands, further solidifying its position in the senior primary care market.
Expansion Details and Strategic Partnerships
Humana's expansion will target 11 of the 15 states where its primary care network already operates. The company is also venturing into new metro areas, including Augusta and Savannah in Georgia; Burlington, Greensboro, and Winston-Salem in North Carolina; and Wichita, Kansas.
A key component of this expansion is the completion of a joint initiative with Walmart. Eleven of the new senior primary care centers will be co-located at Walmart stores, finalizing a partnership launched last year. This strategic move aims to improve accessibility and convenience for seniors seeking primary care services.
Market Position and Growth Strategy
By the end of 2024, Humana operated more than 340 primary care centers through its CenterWell Senior Primary Care and Conviva Senior Primary Care brands. This rapid expansion has positioned Humana as the largest and fastest-growing primary care provider for seniors in the United States.
Despite this growth, Humana's network size still trails behind some competitors, notably UnitedHealth, which operates thousands of clinics and is affiliated with approximately 10,000 physicians nationwide. This disparity highlights the ongoing competition in the vertically integrated healthcare model, where insurers pair with large physician networks to optimize care delivery and cost management.
Financial Implications and Future Outlook
The expansion of Humana's primary care network is part of a broader strategy to diversify revenue streams and better manage healthcare costs. In 2024, the company's intercompany eliminations – revenue paid to subsidiaries like CenterWell for services – reached $16.5 billion, a 7% increase from the previous year.
However, this vertical integration hasn't fully insulated Humana from elevated spending in Medicare Advantage and Medicaid. The company reported a net income of $1.2 billion in 2024, less than half of the $2.5 billion reported in 2023, due to higher care costs in government programs.
Despite these challenges, Humana's management remains optimistic about the growth prospects of CenterWell. CEO Jim Rechtin stated, "We feel good about the opportunities we found to expand our primary care footprint in the second half of 2024." The company plans to continue its expansion while being "thoughtful" in selecting potential M&A targets that align with its growth and financial objectives.
References
- Humana plans to add 30 more primary care centers this year
The new centers are being built or acquired in 11 of the 15 states where Humana’s primary care network already has a presence.
Explore Further
What was the rationale behind Humana's partnership with Walmart for the co-location of senior primary care centers?
How does Humana's primary care network expansion impact its competition with UnitedHealth?
What are the specific financial strategies Humana is employing to manage the increased costs in Medicare Advantage and Medicaid?
Are any other healthcare providers undertaking similar BD transactions or expansions into new metro areas as Humana?
What criteria is Humana using to identify potential M&A targets for its growth and financial objectives?