Why Is Humana Stock Down Premarket Today? Medicare Rate Proposal Hits Insurers

Humana Inc. shares plummeted in premarket trading on Tuesday, January 27, 2026, following the Trump administration’s proposal for nearly flat Medicare Advantage payment rates for 2027. The stock dropped 13.49% to $228.00 in premarket trading as of 5:38 AM EST, down from its previous close of $263.63. The proposed 0.09% net average payment increase fell dramatically short of Wall Street’s expectations of a 4% to 6% rate hike, sending shockwaves through the health insurance sector.

Flat Medicare Advantage Rate Proposal Pressures Insurers

The Centers for Medicare & Medicaid Services announced Monday that Medicare Advantage plans would receive just a 0.09% net average payment increase in 2027, amounting to approximately $700 million total across the industry.

This represents a dramatic reduction from the 5.06% increase insurers received for 2026. CMS Administrator Dr. Mehmet Oz stated the proposal aims to strengthen payment accuracy and modernize risk adjustment while protecting taxpayers from unnecessary spending.

As a Medicare Advantage plan provider with over half of Medicare beneficiaries enrolled in such plans, Humana faces significant pressure from this development. The proposed rates determine how much insurers can charge for monthly premiums, the benefits they can offer, and ultimately their profit margins.

Medicare Advantage represents a core business segment for Humana, making the company particularly vulnerable to rate changes compared to more diversified competitors.

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Humana Leads Health Insurers Lower After CMS Announcement

Humana shares traded at $228.00 in premarket, down $35.55 (-13.49%) from the previous close of $263.63. The stock had already declined 1.08% during Monday’s regular session before the after-hours plunge.

With a market capitalization of $31.71 billion and a 52-week range of $206.87 to $315.35, Humana now trades closer to its yearly lows. The company’s year-to-date return stands at just 2.93%, while its one-year return shows a decline of 9.27%.

The broader health insurance sector also suffered, with CVS Health dropping 9.72%, UnitedHealth Group falling 9.01%, and Elevance Health declining 6.90% in after-hours trading. Analysts note that the proposal also seeks to eliminate certain moneymaking billing practices that have historically been profitable for insurers, adding to investor concerns.

With analyst price targets ranging from $215 to $353 and an average target of $288.29, Humana’s current premarket price reflects significant downward pressure from the regulatory announcement.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.