subject: Tricare extends Humana contract [print this page] Author: Health Insurance Author: Health Insurance
The U.S. Department of Defenses Tricare Management Activity will extend a contract with Humana Military Healthcare Services Inc. through March 31, 2011, according to a filing today with the U.S. Securities and Exchange Commission.
The contract was set to expire at the end of March 2010.
Humana Military, a subsidiary of Louisville-based insurer Humana Inc. (NYSE: HUM), provides managed-care services for 3 million active-duty soldiers and their dependents, along with retired service members and their families in 10 states in Tricares South region.
Humana has been a contractor with the Tricare program since 1996.
Earlier this year, the company lost a bid to continue providing services through the program to UnitedHealth Military & Veterans Services, a division of Minnetonka, Minn.-based UnitedHealth Group Inc. The contract was worth up to $21.8 billon over a five-year period.
Humana filed a protest of the contract award with the U.S. Government Accountability Office. That protest was upheld by the GAO, citing savings Humana likely could provide that were not fully considered when the contract was awarded.
The GAO issued a recommendation on Oct. 28 that the proposals for the South region contract be re-evaluated. Tricare Management Activity had 60 days from the day the recommendation was delivered to decide how it will proceed with the matter.
In the SEC report filed today, Humana said it has not received word from the TMA on what action it plans to take regarding the decision of the GAO to uphold the protest.
Tricare officials previously have said it would take at least 10 months to transition management of the health care contract to another company.
The filing did not include details of Humanas expected revenue from the contract extension but said Humana officials epxect to update the companys earning guidance on Feb. 1, when the company releases its 2009 earnings report.
In November, the company said it expects earnings per share of about $6.15 for the year ending Dec. 31, 2009. Earnings per share for 2010 are expected to be in the range of $5.05 to $5.25, according to an earlier Business First report.About the Author:
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