<div id="readability-page-1"><div>Fitch Ratings-Chicago-15 December 2025:Fitch Ratings has downgraded the Insurer Financial Strength (IFS) ratings for various Humana Inc. (HUM) insurance company subsidiaries to 'A-' from 'A'. Fitch also downgraded HUM's 'BBB+' Long-Term Issuer Default Rating (IDR) to 'BBB' from 'BBB+' and the ratings assigned to HUM's senior notes to 'BBB-' from 'BBB'. The Rating Outlook on the company's ratings is Stable.The downgrades reflect Fitch's assessment that Humana's EBITDA-based margins are unlikely to recover to levels that support the prior ratings over the rating horizon. Key considerations include on-going margin pressure from elevated healthcare utilization across the sector and significantly lower MA-related quality bonus payments stemming from a decline in Humana's Star Ratings on its largest MA contract. Additionally, weaker operating margins have increased the earnings-based leverage ratio above prior rating expectations, while financial leverage remains near its long-term target of 40%.Key Rating DriversFinancial Performance and Earnings: Fitch assesses Humana's financial performance and earnings, a heavily weighted ratings factor, as historically strong, reflecting consistent mid-single-digit operating EBITDA/revenue margins. However, reported earnings over the past five years have shown a gradual decline in margins and moderate volatility due to nonrecurring items and varying utilization partially linked to the pandemic, and, more recently, elevated healthcare utilization trends.Although management has implemented effective changes to the benefit structure of its MA products, the additional adverse impact of reduced bonus payments is expected to continue to pressure the company's margins. Humana has appealed the October 2025 dismissal of its lawsuit challenging CMS's Star rating methodology. A favorable ruling could substantially improve Humana's operating margin in 2026 through the resumption of bonus payments.Company Profile: Fitch considers Humana Inc.'s company profile favorable, a heavily weighted ratings factor. Its business profile reflects a favorable competitive position, primarily in the Medicare Advantage (MA) market, large operating scale, and favorable geographic diversification and business risk profile. Humana's profile reflects Fitch's view that the MA business is more influenced by U.S. government intervention and typically generates moderately lower EBITDA-based margins than commercial business.Capitalization and Leverage: Humana maintains adequate capitalization and leverage, which is a moderately weighted ratings factor. Financial leverage increased significantly after the August 2021 acquisition of the remaining 60% of Kindred at Home that Humana did not own. Humana's financial leverage declined following the August 2022 sale of a 60% interest in the hospice business of Kindred at Home to a third party, but remains moderately above the run-rate levels prior to 3Q21.While Humana's financial leverage ratio (FLR) is within Fitch's expectation of 40% or below, the company's debt/EBITDA ratio was about 3.6x for the 12 months ended Sept. 30, 2025. This is significantly above guidelines for the prior ratings. Fitch expects continued margin pressure in 2026 to keep debt/EBITDA above expectations. Fitch anticipates the combined risk-based capital (RBC) ratio will be managed at 200%-225% over the longer term, though it was about 235% at YE 2024.Debt Service and Financial Flexibility: Humana's debt service capabilities and financial flexibility, which are moderately weighted rating factors, are strong, but pressured by recent operating performance. Fitch expects near-term operating EBITDA/interest expense ratios to remain between 5x and 6x. Financial flexibility is maintained through strong cash flow from subsidiaries, $4.0 billion of credit facilities, and proven debt and equity market access under typical market conditions.RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade-- Sustained EBITDA-based margin below 3% and GAAP return on capital below 7.5%;--Sustained FLR above 43% and debt/EBITDA ratio above 3.2x.--A reduction in targeted or sustained organization-wide RBC ratio below 200% of the company action level.Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade--Sustained financial leverage ratio at or below 40% and debt/EBITDA ratio of 2.3x.--Sustained EBITDA-based margin above 4.1%;--A reduction in targeted and run-rate FLR below 38%; and--An increase in targeted and run-rate, organization-wide RBC ratio above 250% of the company action level.REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING The principal sources of information used in the analysis are described in the Applicable Criteria. ESG ConsiderationsThe highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. For more information on Fitch's ESG Relevance Scores, visit https://www.fitchratings.com/topics/esg/products#esg-relevance-scores.Humana Health Plan Inc.; Long Term Insurer Financial Strength; Downgrade; A-; Rating Outlook StableHumana Health Benefit Plan of Louisiana; Long Term Insurer Financial Strength; Downgrade; A-; Rating Outlook StableCareplus Health Plans Inc.; Long Term Insurer Financial Strength; Downgrade; A-; Rating Outlook StableHumana Insurance Company; Long Term Insurer Financial Strength; Downgrade; A-; Rating Outlook StableHumana Inc.; Long Term Issuer Default Rating; Downgrade; BBB; Rating Outlook Stable; Short Term Issuer Default Rating; Downgrade; F3----senior unsecured; Long Term Rating; Downgrade; BBB-----senior unsecured; Short Term Rating; Downgrade; F3Humana Medical Plan Inc.; Long Term Insurer Financial Strength; Downgrade; A-; Rating Outlook StableContacts:Primary Rating AnalystGerald Glombicki, CPA, ARMSenior Director+1 312 606 2354gerry.glombicki@fitchratings.comFitch Ratings, Inc.One North Wacker DriveChicago, IL 60606Secondary Rating AnalystElizabeth Kolling,Analyst+1 212 908 9110elizabeth.kolling@fitchratings.comCommittee ChairpersonJeffrey Mohrenweiser, CFA, FSASenior Director+1 312 368 3182jeff.mohrenweiser@fitchratings.comMEDIA RELATIONS: Cristina Bermudez, New York, Tel: +1 212 612 7892, Email: cristina.bermudez@thefitchgroup.comAdditional information is available on www.fitchratings.comADDITIONAL DISCLOSURESDodd-Frank Rating Information Disclosure FormSolicitation StatusAdditional Disclosures For Unsolicited Credit RatingsEndorsement StatusEndorsement PolicyALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. 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Fitch Ratings has downgraded Humana Inc.'s Insurer Financial Strength ratings to 'A-' from 'A' and its Long-Term Issuer Default Rating to 'BBB' from 'BBB+'. The downgrades reflect concerns over Humana's EBITDA-based margins, ongoing margin pressure from elevated healthcare utilization, and lower quality bonus payments. Despite these downgrades, the rating outlook remains stable. Key factors include Humana's financial performance, company profile, capitalization, leverage, and debt service capabilities.

Fitch Downgrades Humana's Ratings; Outlook Stable