HUMANA INC

Previous wording

Beginning in 2022, in order to create capacity to fund growth and investment in our Medicare Advantage business and further expansion of our healthcare services capabilities, we committed to drive additional value for the enterprise through cost saving, productivity initiatives, and value acceleration from previous investments. As a result of these initiatives, we recorded charges, primarily in asset impairments, of $55 million and $151 million for the three and nine months ended September 30, 2024, respectively, and $52 million for the three and nine months ended September 30, 2023 within operating costs in the condensed consolidated statements of income. These charges were recorded at the corporate level and not allocated to the segments. We expect to incur additional charges through the end of 2024.

Current wording

In order to create capacity to fund growth and investment in our Medicare Advantage business and further expansion of our healthcare services capabilities, we have committed to driving additional value for the enterprise through cost saving, productivity initiatives, and value acceleration from previous investments. As a result of these initiatives, we recorded charges of $24 million for the three months ended March 31, 2025 and $29 million for the three months ended March 31, 2024 within operating costs in the condensed consolidated statements of income. These charges primarily relate to asset impairments in the 2024 and 2025 quarters, as well as severance charges in connection with workforce optimization and external consulting spend for these initiatives in the 2025 quarter.

Previous wording

Our two reportable segments, Insurance and CenterWell, are based on a combination of the type of health plan customer and adjacent businesses centered on well-being solutions for our health plans and other customers, as described below. These segment groupings are consistent with information used by our Chief Executive Officer, the Chief Operating Decision Maker, to assess performance and allocate resources.

Current wording

Our two reportable segments, Insurance and CenterWell, are based on a combination of the type of health plan customer and adjacent businesses centered on well-being solutions for our health plans and other customers, as described below. Our Chief Executive Officer, the Chief Operating Decision Maker, utilizes these segment groupings and results of each segment, measured by income (loss) from operations, to assess performance and allocate resources primarily during our annual budget process and periodic forecast updates.

Previous wording

The Insurance segment consists of Medicare benefits, marketed to individuals or directly via group Medicare accounts, as well as our contract with CMS to administer the Limited Income Newly Eligible Transition, or LI-NET, prescription drug plan program and contracts with various states to provide Medicaid, dual eligible demonstration, and Long-Term Support Services benefits, which we refer to collectively as our state-based contracts. This segment also includes products consisting of employer group commercial fully-insured medical and specialty health insurance benefits marketed to individuals and employer groups, including dental, vision, and other supplemental health benefits, as well as administrative services only, or ASO. In addition, our Insurance segment includes our Military services business, primarily our T-2017 East Region contract, as well as the operations of our PBM business.

Current wording

The Insurance segment consists of Medicare benefits, marketed to individuals or directly via group Medicare accounts, as well as our contract with CMS to administer the Limited Income Newly Eligible Transition, or LI-NET, prescription drug plan program and contracts with various states to provide Medicaid, dual eligible demonstration, and Long-Term Support Services benefits, which we refer to collectively as our state-based contracts. This segment also includes products consisting of specialty health insurance benefits marketed to individuals and employer groups, including dental, vision, and other supplemental health benefits. In addition, our Insurance segment includes our Military services business, primarily our T-5 East Region contract, as well as the operations of our PBM business.

Previous wording

The CenterWell segment includes our pharmacy, primary care, and home solutions operations. The segment also includes our strategic partnerships with WCAS to develop and operate senior-focused, payor-agnostic, primary care centers, as well as our minority ownership interest in hospice operations. Services offered by this segment are designed to enhance the overall healthcare experience. These services may lead to lower utilization associated with improved member health and/or lower drug costs.

Current wording

The CenterWell segment includes our pharmacy, primary care, and home solutions operations. Services offered by this segment are designed to enhance the overall healthcare experience. These services may lead to lower utilization associated with improved member health and/or lower drug costs.

Previous wording

The results of each segment are measured by income (loss) from operations. Transactions between reportable segments primarily consist of sales of products and services rendered by our CenterWell segment, primarily pharmacy, primary care, and home solutions, to our Insurance segment customers. Intersegment sales and expenses are recorded primarily at fair value and eliminated in consolidation. Members served by our segments often use the same provider networks, enabling us in some instances to obtain more favorable contract terms with providers. Our segments also share indirect costs and assets. As a result, the profitability of each segment is interdependent. We allocate most operating expenses to our segments. Assets and certain corporate income and expenses are not allocated to the segments, including the portion of investment income not supporting segment operations, interest expense on corporate debt, and certain other corporate expenses. These items are managed at a corporate level. These corporate amounts are reported separately from our reportable segments and are included with intersegment eliminations.

Current wording

Transactions between reportable segments primarily consist of sales of products and services rendered by our CenterWell segment, primarily pharmacy, primary care, and home solutions, to our Insurance segment customers. Intersegment sales and expenses are recorded primarily at fair value and eliminated in consolidation. Members served by our segments often use the same provider networks, enabling us in some instances to obtain more favorable contract terms with providers. Our segments also share indirect costs and assets. As a result, the profitability of each segment is interdependent. We allocate most operating expenses to our segments. Assets and certain corporate income and expenses are not allocated to the segments, including the portion of investment income not supporting segment operations, interest expense on corporate debt, and certain other corporate expenses. These items are managed at a corporate level. These corporate amounts are reported separately from our reportable segments and are included with intersegment eliminations.

Previous wording

One of the product offerings of our Insurance segment is Medicare stand-alone prescription drug plans, or PDP, under the Medicare Part D program. Our quarterly Insurance segment earnings and operating cash flows are impacted by the Medicare Part D benefit design and changes in the composition of our membership. The Medicare Part D benefit design results in coverage that varies as a member’s cumulative out-of-pocket costs pass through successive stages of a member’s plan period, which begins annually on January 1 for renewals. These plan designs generally result in us sharing a greater portion of the responsibility for total prescription drug costs in the early stages and less in the latter stages. As a result, the PDP benefit ratio generally decreases as the year progresses. In addition, the number of low income senior members as well as year-over-year changes in the mix of membership in our stand-alone PDP products affects the quarterly benefit ratio pattern.

Current wording

Our quarterly Insurance segment earnings and operating cash flows are impacted by the Medicare Part D benefit design and changes in the composition of our stand-alone prescription drug plan, or PDP, membership. The Medicare Part D benefit design results in coverage that varies as a member’s cumulative out-of-pocket costs pass through successive stages of a member’s plan period, which begins annually on January 1 for renewals. Effective January 1, 2025, the Medicare Part D coverage gap was eliminated as mandated by the Inflation Reduction Act of 2022, or IRA. The standard Part D benefit now comprises three phases: the deductible phase, the initial coverage phase and the catastrophic coverage phase. Beneficiaries' out-of-pocket expenses for covered prescription drugs are capped at $2,000, after which they incur no additional cost sharing for the remainder of the year. In addition, the Coverage Gap Discount Program was replaced by the Manufacturer Discount Program, requiring pharmaceutical manufacturers to provide discounts on brand name drugs during both the initial coverage and catastrophic phases. These changes are anticipated to reduce out-of-pocket costs for beneficiaries and impact plan liabilities, accordingly. These benefit design changes will result in us sharing a greater portion of the responsibility and result in prescription costs that are more level throughout the year as compared to the historical seasonal decline seen prior to the IRA. In addition, the number of low-income senior members, as well as year-over-year changes in the mix of membership in our stand-alone PDP products, affects the quarterly benefit ratio pattern. The Insurance segment also experiences seasonality in the operating cost ratio as a result of costs incurred in the second half of the year associated with the Medicare marketing season.

Previous wording

•Our strategy offers our members affordable health care combined with a positive consumer experience in growing markets. At the core of this strategy is our integrated care delivery model, which unites quality care, high member engagement, and sophisticated data analytics. Our approach to primary, physician-directed care for our members aims to provide quality care that is consistent, integrated, cost-effective, and member-focused, provided by both employed physicians and physicians with network contract arrangements. The model is designed to improve health outcomes and affordability for individuals and for the health system as a whole, while offering our members a simple, seamless healthcare experience. We believe this strategy is positioning us for long-term growth in both membership and earnings. We offer providers a continuum of opportunities to increase the integration of care and offer assistance to providers in transitioning from a fee-for-service to a value-based arrangement. These include performance bonuses, shared savings and shared risk relationships. At September 30, 2024, approximately 3,984,900 members, or 70%, of our individual Medicare Advantage members were in value-based relationships under our integrated care delivery model, as compared to 3,727,500 members, or 69%, at September 30, 2023.

Current wording

•Our strategy offers our members affordable health care combined with a positive consumer experience in growing markets. At the core of this strategy is our integrated care delivery model, which unites quality care, high member engagement, and sophisticated data analytics. Our approach to primary, physician-directed care for our members aims to provide quality care that is consistent, integrated, cost-effective, and member-focused, provided by both employed physicians and physicians with network contract arrangements. The model is designed to improve health outcomes and affordability for individuals and for the health system as a whole, while offering our members a simple, seamless healthcare experience. We believe this strategy is positioning us for long-term growth in both membership and earnings. We offer providers a continuum of opportunities to increase the integration of care and offer assistance to providers in transitioning from a fee-for-service to a value-based arrangement. These include performance bonuses, shared savings and shared risk relationships. At March 31, 2025, approximately 3,501,700 members, or

Previous wording

•Net income attributable to Humana was $0.5 billion, or $3.98 per diluted common share, and $0.8 billion, or $6.71 per diluted common share, for the three months ended September 30, 2024 and 2023, respectively. Net income attributable to Humana was $1.9 billion, or $15.72 per diluted common share, and $3.0 billion, or $24.26 per diluted common share, for the nine months ended September 30, 2024, and 2023, respectively. These comparisons were significantly impacted by put/call valuation adjustments associated with non-consolidating minority interest investments, charges associated with value creation initiatives, transaction and integration costs and an accrual related to certain anticipated litigation expenses. The impact of these adjustments to our consolidated income before income taxes and equity in net earnings and diluted earnings per common share was as follows for the 2024 and 2023 quarter and period:

Current wording

•Net income attributable to Humana was $1.2 billion, or $10.30 per diluted common share, and $0.7 billion, or $6.11 per diluted common share, for the three months ended March 31, 2025 and 2024, respectively. These comparisons were significantly impacted by put/call valuation adjustments associated with non-consolidating minority interest investments and charges associated with value creation initiatives. The impact of these adjustments to our consolidated income before income taxes and equity in net losses and diluted earnings per common share was as follows for the 2025 and 2024 quarter:

Previous wording

It is reasonably possible that these laws and regulations, as well as other current or future legislative, judicial or regulatory changes including restrictions on our ability to manage our provider network, manage and sell our products, or otherwise operate our business, or restrictions on profitability, including reviews by regulatory bodies that may compare our Medicare Advantage profitability to our non-Medicare Advantage business profitability, or compare the profitability of various products within our Medicare Advantage business, and require that they remain within certain ranges of each other, increases in member benefits or changes to member eligibility criteria without corresponding increases in premium payments to us, increases in regulation of our prescription drug benefit businesses, or changes to the Part D prescription drug benefit design (and uncertainty arising from the implementation of these changes) in the aggregate may have a material adverse effect on our results of operations (including restricting revenue, enrollment and premium growth in certain products and market segments, restricting our ability to expand into new markets, increasing our medical and operating costs, further lowering our Medicare payment rates and increasing our expenses associated with assessments); our financial position (including our ability to maintain the value of our goodwill); and our cash flows.

Current wording

It is reasonably possible that these laws and regulations, as well as other current or future legislative, judicial or regulatory changes including restrictions on our ability to manage our provider network, manage and sell our products, or otherwise operate our business, or restrictions on profitability, including reviews by regulatory bodies that may compare our Medicare Advantage profitability to our non-Medicare Advantage business profitability, or compare the profitability of various products within our Medicare Advantage business, and require that they remain within certain ranges of each other, increases in member benefits or changes to member eligibility criteria without corresponding increases in premium payments to us, further restrictions on service arrangements and fee payments between intercompany or vertically-integrated assets, increases in regulation of our prescription drug benefit businesses, or changes to the Part D prescription drug benefit design (and uncertainty arising from the implementation of these changes) in the aggregate may have a material adverse effect on our results of operations

Previous wording

The following discussion primarily deals with our results of operations for the three months ended September 30, 2024, or the 2024 quarter, the three months ended September 30, 2023, or the 2023 quarter, the nine months ended September 30, 2024, or the 2024 period, and the nine months ended September 30, 2023, or the 2023 period.

Current wording

The following discussion primarily deals with our results of operations for the three months ended March 31, 2025, or the 2025 quarter and the three months ended March 31, 2024, or the 2024 quarter.

Previous wording

(b)Represents operating costs as a percentage of total revenues less investment income.

Current wording

(b)Represents operating costs, excluding depreciation and amortization, as a percentage of total revenues less investment income.

Previous wording

Consolidated services revenue increased $87 million, or 8.6%, from $1.0 billion in the 2023 quarter to $1.1 billion in the 2024 quarter and increased $272 million, or 9.1%, from $3.0 billion in the 2023 period to $3.3 billion in the 2024 period primarily due to higher revenues associated with growth in the primary care business, partially offset by the impact of the v28 risk model revision.

Current wording

Consolidated services revenue increased $272 million, or 25.6%, from $1.1 billion in the 2024 quarter to $1.3 billion in the 2025 quarter primarily due to higher revenues associated with growth in the primary care business, partially offset by the impact of the v28 risk model revision.

Previous wording

Consolidated benefits expense included $24 million of favorable prior-period medical claims reserve development in the 2024 quarter and $4 million of favorable prior-period medical claims development in the 2023 quarter. Consolidated benefits expense included $693 million of favorable prior-period medical claims reserve development in the 2024 period and $758 million of favorable prior-period medical claims reserve development in the 2023 period. Prior-period medical claims reserve development decreased the consolidated benefit ratio by approximately 10 basis points in the 2024 quarter and did not impact the consolidated benefit ratio in the 2023 quarter. Prior-period medical claims reserve development decreased the consolidated benefit ratio by approximately 80 basis points in the 2024 period and decreased the consolidated benefit ratio by approximately 100 basis points in the 2023 period.

Current wording

Consolidated benefits expense included $477 million of favorable prior-period medical claims reserve development in the 2025 quarter and $535 million of favorable prior-period medical claims development in the 2024 quarter. Prior-period medical claims reserve development decreased the consolidated benefit ratio by 160 basis points in the 2025 quarter and decreased the consolidated benefit ratio by 190 basis points in the 2024 quarter.

Previous wording

The effective income tax rate was 24.4% and 23.5% for the three months ended September 30, 2024, and 2023, respectively, and 24.9% and 23.1% for the nine months ended September 30, 2024 and 2023, respectively. The year-over-year increase in the effective income tax rate is primarily due to a change in the mix of current year earnings between our Insurance segment and our CenterWell health services segment, as our CenterWell health services segment is subject to a higher effective tax rate than our Insurance segment. In addition, the prior year income tax rate was favorably impacted by the recognition of a non-taxable gain.

Current wording

The effective income tax rate was 24.6% and 25.3% for the three months ended March 31, 2025, and 2024, respectively. The year-over-year decrease in the effective income tax rate is primarily due to reduced state tax expense.

Previous wording

Commercial fully-insured medical membership decreased 383,400 members, or 93.7%, from September 30, 2023 to September 30, 2024 and commercial ASO medical membership decreased 261,900 members, or 92.1%, from September 30, 2023 to September 30, 2024. These decreases reflect our planned exit of the Employer Group Commercial Medical Products business, which includes all fully insured, self-funded and Federal Employee Health Benefit medical plans, as well as associated wellness and rewards programs. We anticipate the exit of this line of business to be finalized in the first half of 2025.

Current wording

(a) Reflects the exit of the Employer Group Commercial Medical Products business.

Previous wording

Insurance segment income from operations decreased $0.4 billion, or 62.0%, from $0.7 billion in the 2023 quarter to $0.3 billion in the 2024 quarter and decreased $1.1 billion, or 37.2%, from $3.1 billion in the 2023 period to $1.9 billion in the 2024 period primarily due to the same factors impacting the segment's higher benefit ratio partially offset by the lower operating cost ratio as more fully described below.

Current wording

Insurance segment income from operations increased $0.7 billion, or 75.3%, from $0.9 billion in the 2024 quarter to $1.6 billion in the 2025 quarter primarily due to the same factors impacting the Insurance segment's lower benefit and operating cost ratios as more fully described below.

Previous wording

Individual Medicare Advantage membership increased 284,800 members, or 5.3%, from September 30, 2023 to September 30, 2024 primarily due to membership additions associated with the previous Annual Election Period, or AEP. Individual Medicare Advantage membership includes 939,600 D-SNP members as of September 30, 2024, a net increase of 71,600 D-SNP members, or 8.2%, from 868,000 D-SNP members as of September 30, 2023.

Current wording

Individual Medicare Advantage membership decreased 333,100 members, or 6.0%, from March 31, 2024 to March 31, 2025, inclusive of the decision to exit certain unprofitable plans and counties. Individual Medicare Advantage membership includes 799,100 D-SNP members as of March 31, 2025, a net decrease of 123,100 D-SNP members, or 13.3%, from 922,200 D-SNP members as of March 31, 2024.

Previous wording

CenterWell income from operations decreased $18 million, or 4.5%, from $400 million in the 2023 quarter to $382 million in the 2024 quarter and decreased $0.02 billion, or 1.5%, from $1.02 billion in the 2023 period to $1.00 billion in the 2024 period primarily due to the same factors impacting the segment's operating cost ratio as more fully described below.

Current wording

CenterWell income from operations increased $0.1 billion, or 39.0%, from $0.3 billion in the 2024 quarter to $0.4 billion in the 2025 quarter primarily due to the CenterWell segment's lower operating cost ratio as more fully described below.

Previous wording

CenterWell services revenue increased $118 million, or 15.5%, from $759 million in the 2023 quarter to $877 million in the 2024 quarter and increased $0.3 billion, or 12.7%, from $2.3 billion in the 2023 period to $2.6 billion in the 2024 period primarily due to higher revenues associated with growth in the primary care business, partially offset by the impact of the v28 risk model revision.

Current wording

CenterWell services revenue increased $0.3 billion, or 37.5%, from $0.8 billion in the 2024 quarter to $1.1 billion in the 2025 quarter primarily due to higher revenues associated with growth in the primary care business, partially offset by the impact of the v28 risk model revision.

Previous wording

Cash and cash equivalents increased to approximately $5.1 billion at September 30, 2024 from $4.7 billion at December 31, 2023. The change in cash and cash equivalents for the nine months ended September 30, 2024 and 2023 is summarized as follows:

Current wording

Cash and cash equivalents increased to approximately $4.3 billion at March 31, 2025 from $2.2 billion at December 31, 2024. The change in cash and cash equivalents for the three months ended March 31, 2025 and 2024 is summarized as follows:

Previous wording

The detail of total net receivables at September 30, 2024 and December 31, 2023 and reconciliation to cash flow for the nine months ended September 30, 2024 and 2023 was as follows:

Current wording

The detail of total net receivables at March 31, 2025 and December 31, 2024 and reconciliation to cash flow for the three months ended March 31, 2025 and 2024 was as follows:

Previous wording

The changes in Medicare receivables for both the 2024 period and the 2023 period reflect individual Medicare Advantage membership growth and the typical pattern caused by the timing of accruals and related collections associated with the CMS risk-adjustment model. Significant collections occur with the mid-year and final settlements with CMS in the second and third quarter.

Current wording

The change in Medicare receivables for the 2025 quarter reflects higher per member Medicare premiums, driven largely by an increased direct subsidy due to the IRA. The change in Medicare receivables for the 2024 quarter reflects individual Medicare Advantage membership growth. In addition, both periods further reflect the typical pattern caused by the timing of accruals and related collections associated with the CMS risk-adjustment model. Significant collections occur with the mid-year and final settlements with CMS in the second and third quarter.

Previous wording

During the 2024 period and 2023 period, we acquired various businesses for approximately $37 million and $223 million, net of cash and cash equivalents received, respectively.

Current wording

Acquisition related activities during the first quarter of 2025 were not material. During the 2024 quarter, we acquired various businesses for approximately $14 million, net of cash and cash equivalents received, respectively.

Previous wording

Our ongoing capital expenditures primarily relate to our information technology initiatives, support of services in our primary care operations including medical and administrative facility improvements necessary for activities such as the provision of care to members, claims processing, billing and collections, wellness solutions, care coordination, regulatory compliance and customer service. Total net capital expenditures, excluding acquisitions, were $421 million in the 2024 period and $721 million in the 2023 period.

Current wording

Our ongoing capital expenditures primarily relate to our information technology initiatives, support of services in our primary care operations including medical and administrative facility improvements necessary for activities such as the provision of care to members, claims processing, billing and collections, wellness solutions, care coordination, regulatory compliance and customer service. Total net capital expenditures, excluding acquisitions, were $95 million in the 2025 quarter and $177 million in the 2024 quarter.

Previous wording

Claim payments were higher than receipts from CMS associated with Medicare Part D claim subsidies for which we do not assume risk by $0.6 billion in the 2024 period and receipts from CMS associated with Medicare Part D claim subsidies for which we do not assume risk were higher than claim payments by $2.5 billion in the 2023 period.

Current wording

Receipts from CMS associated with Medicare Part D claim subsidies for which we do not assume risk were higher than claim payments by $75 million and $569 million in the 2025 and 2024 quarters, respectively.

Previous wording

Under our administrative services only TRICARE contracts, health care costs payments for which we do not assume risk exceeded reimbursements from the federal government by $75 million and $28 million in the 2024 and 2023 periods, respectively.

Current wording

Under our administrative services only TRICARE contracts, health care costs payments for which we do not assume risk exceeded reimbursements from the federal government by $110 million and $70 million in the 2025 and 2024 quarters, respectively.

Previous wording

In March 2023, we issued $500 million of 5.700% unsecured senior notes due March 13, 2026 and $750 million of 5.500% unsecured senior notes due March 15, 2053. Our net proceeds, reduced for the underwriters' discounts and commissions paid, were $1.2 billion. We used the net proceeds to repay outstanding amounts under our $500 million Delayed Draw Term Loan. The remaining net proceeds will be used for general corporate purposes, which include the repayment of existing indebtedness, including borrowings under our commercial paper program

Current wording

In March 2025, we issued $750 million of 5.550% unsecured senior notes due May 1, 2035, $500 million of 6.000% unsecured senior notes due May 1, 2055, and an additional $250 million of our existing 5.375% unsecured senior notes due April 15, 2031. Our net proceeds, reduced for the underwriters' discounts and commissions paid, were $1.481 billion. We used the net proceeds of these offerings to repay outstanding amounts from the 4.500% Senior Notes due on April 1,2025. The remaining net proceeds will be used for general corporate purposes, which may include the repayment of our existing indebtedness, including borrowings under our commercial paper program.

Previous wording

In March 2024, we issued $1.25 billion of 5.375% unsecured senior notes due April 15, 2031 and $1.00 billion of 5.750% unsecured senior notes due April 15, 2054. Our net proceeds, reduced for the underwriters' discounts and commissions paid, were $2.23 billion. We used the net proceeds for general corporate purposes, which include the repayment of existing indebtedness, including borrowings under our commercial paper program.

Current wording

In March 2024, we issued $1.3 billion of 5.375% unsecured senior notes due April 15, 2031 and $1.0 billion of 5.750% unsecured senior notes due April 15, 2054. Our net proceeds, reduced for the underwriters' discounts and commissions paid, were $2.2 billion. We used the net proceeds for general corporate purposes, which included the repayment of existing indebtedness, including borrowings under our commercial paper program.

Previous wording

Net repayments from the issuance of commercial paper were $895 million in the 2024 period and net proceeds from the issuance of commercial paper were $1.6 billion in the 2023 period. The maximum principal amount outstanding at any one time during the 2024 period was $2.7 billion.

Current wording

Net repayments from the issuance of commercial paper were $4 million and $644 million in the 2025 quarter and 2024 quarter, respectively. The maximum principal amount outstanding at any one time during the 2025 quarter was $1.2 billion.

Previous wording

We repurchased common shares for $750 million and $980 million in the 2024 period and 2023 period, respectively, under share repurchase plans authorized by the Board of Directors. We also acquired common shares in connection with employee stock plans for $18 million and $31 million in the 2024 period and 2023 period, respectively.

Current wording

We repurchased common shares for $702 million in the 2024 quarter, under share repurchase plans authorized by the Board of Directors. We also acquired common shares in connection with employee stock plans for $9 million and $15 million in the 2025 quarter and 2024 quarter, respectively.

Previous wording

We paid dividends to stockholders of $323 million and $320 million during the 2024 period and 2023 period, respectively.

Current wording

We paid dividends to stockholders of $108 million and $109 million during the 2025 quarter and 2024 quarter, respectively.

Previous wording

In addition, we operate as a holding company in a highly regulated industry. Humana Inc., our parent company, is dependent upon dividends and administrative expense reimbursements from our subsidiaries, most of which are subject to regulatory restrictions. We continue to maintain significant levels of aggregate excess statutory capital and surplus in our state-regulated operating subsidiaries. Cash, cash equivalents, and short-term investments at the parent company were $609 million at September 30, 2024 compared to $510 million at December 31, 2023. This increase primarily reflects working capital changes, net proceeds from the issuance of senior notes and commercial paper, proceeds from the sale and maturities of investment securities, dividends from insurance subsidiaries and cash from certain non-insurance subsidiaries within our CenterWell segment partially offset by common stock repurchases, repayment of maturing senior notes, repayment of borrowings under the commercial paper program, purchases of investment securities, capital expenditures, capital contributions to certain subsidiaries, cash dividends to shareholders and acquisitions. Our use of operating cash derived from our non-insurance subsidiaries, such as our CenterWell segment, is generally not restricted by departments of insurance (or comparable state regulators).

Current wording

In addition, we operate as a holding company in a highly regulated industry. Humana Inc., our parent company, is dependent upon dividends and administrative expense reimbursements from our subsidiaries, most of which are subject to regulatory restrictions. We continue to maintain significant levels of aggregate excess statutory capital and surplus in our state-regulated operating subsidiaries. Cash, cash equivalents, and short-term investments at the parent company were $1.2 billion at March 31, 2025 compared to $562 million at December 31, 2024. This increase primarily reflects net proceeds from the issuance of senior notes and commercial paper, proceeds from maturities of investment securities, partially offset by repayment of borrowings under the commercial paper program, capital contributions to certain subsidiaries, net working capital changes, cash dividends to shareholders, capital expenditures, and common stock repurchases. Our use of operating cash derived from our non-insurance subsidiaries, such as our CenterWell segment, is generally not restricted by departments of insurance (or comparable state regulators).

Previous wording

Although minimum required levels of equity are largely based on premium volume, product mix, and the quality of assets held, minimum requirements vary significantly at the state level. Based on the most recently filed statutory financial statements as of June 30, 2024, our state regulated subsidiaries had aggregate statutory capital and surplus of approximately $13.5 billion, which exceeded aggregate minimum regulatory requirements of $10.6 billion. The amount of ordinary dividends paid to our parent company was approximately $0.5 billion during the nine months ended September 30, 2024. The amount, timing and mix of ordinary and extraordinary dividend payments will vary due to state regulatory requirements, the level of excess statutory capital and surplus and expected future surplus requirements related to, for example, premium volume and product mix.

Current wording

Although minimum required levels of equity are largely based on premium volume, product mix, and the quality of assets held, minimum requirements vary significantly at the state level. Based on the most recently filed statutory financial statements as of December 31, 2024, our state regulated subsidiaries had aggregate statutory capital and surplus of approximately $13.2 billion, which exceeded aggregate minimum regulatory requirements of $11.4 billion. The amount of ordinary dividends that may be paid to our parent company in 2025 is approximately $1.1 billion in the aggregate. Actual dividends paid to our parent company were approximately $1.5 billion in 2024. The amount, timing and mix of ordinary and extraordinary dividend payments will vary due to state regulatory requirements, the level of excess statutory capital and surplus and expected future surplus requirements related to, for example, premium volume and product mix.