David Jones and Wendell Cherry started Humana Inc. in 1961 as a nursing home business in Louisville, Kentucky. The choice to launch the business was made in an unusual circumstance. It happened in Louisville as the two men were playing a round of golf. The initial investment for each of them was $1,000. The business quickly rose to the position of the largest nursing home provider in the country.
In 1971, after realizing that operating hospitals could generate higher profits, they sold their stake in the chain of nursing homes and began buying hospitals. The name Extendicare was changed to Humana Inc. to better reflect the company’s new focus. in 1974. In the years that followed, Humana expanded significantly organically. it has acquired American Medicorp Inc. in 1978 doubled the company’s size. One hospital was opened each month beginning in the middle of the 1970s thanks to a hurried construction process. By compressing time and overlapping processes, this expedited construction schedule made it possible to develop hospital projects incredibly quickly. Humana next developed the double corridor hospital construction model, which reduced the distance between patients and nurses by positioning nursing support services inside the structure and patient rooms on the outside.
In time, Humana rose to become the largest hospital company in the world in the 1980s. Humana developed an integrated health care delivery system as the American health care system changed in the 1980s by developing a family of flexible health care plans. By connecting the health care service with a health insurance plan, they were able to start selling health insurance in 1984. .
The innovative artificial heart research of Dr. In 1985, the newly established Humana Heart Institute sent Robert Jarvik and Dr. William DeVries to Louisville. Clark, a 61-year-old retired dentist from Des Moines, Washington, underwent surgery with surgeon William DeVries that year to become the first person to have an artificial heart permanently implanted. For DeVries, who was 38 at the time, that joyful moment marked the successful conclusion of the three years he had spent honing the technique that made the implant possible and waiting for a patient who satisfied the stringent requirements set forth for implant candidates by the Food and Drug Administration. 7½ hours passed for DeVries. operation was “almost a spiritual experience. Therefore, acquiring such a man and his collaborator was going to put invention and life extension at the core of Humana.
Humana changed during the 1990s, becoming a provider of consumer health benefits. In 1993, Humana separated its hospital operations from its health insurance operations and founded Galen Health Care Inc. Galen and Columbia/HCA merged shortly after. Humana started working as a pioneer in consumer-driven health care in 1999 after United Healthcare’s failed acquisition attempt of Humana in 1998; the company launched its first services on September 11, 2001. The marketing and administration of health benefit consumer services. became a very profitable area of The Humana building serves as the primary base of operations for Humana.
by means of a collaboration with Navigy, Inc., a subsidiary of Florida’s Blue Cross and Blue Shield Association, Inc., in 2001, In order to provide doctors and other healthcare professionals with a business solution to handle their daily health plan transactions, Humana launched Availity.
In 2003, Humana started selling services for health savings accounts to both individuals and businesses. The Business Health Care Group of Southeast Wisconsin selected Humana as its administrative partner to lower health care costs in Southeastern Wisconsin to the Midwest average in 2005, primarily through consumer education, providing cost and quality information on healthcare providers, structuring accountability of all stakeholders, and collective purchasing. More than 200 member companies, including both large and small employers, make up this group, which today serves more than 150,000 patients in southeast Wisconsin.
The Medicare Prescription Drug, Improvement, and Modernization Act was passed in the U.S. Humana launched a forceful education campaign in 2006 under the direction of the S. Congress to promote Medicare Advantage and Prescription Drug Plans to Medicare-eligible consumers nationwide. About 5 million people signed up for Humana’s services through a cross-country RV tour and a strategic partnership with companies that distribute Medicare, like Wal-Mart. This propelled Humana to the #2 position in the market share for senior products in the industry. Additionally, in 2006, Humana introduced Right Source, a national mail-order retail pharmacy company.
The list below shows some of the major acquisitions by Humana since 1990 in the U.S.A::
1990 Michael Reese Health Plan Illinois
1995 The Dental Concern Illinois
1995 Carrington Illinois
1996 Employers Health Insurance (EHI) Wisconsin
1997 Physicians Corp of America (PCA) Texas
1997 ChoiceCare Ohio
2000 Memorial Sisters of Charity Texas
2003 Oschner Health Plan Louisiana
2005 CarePlus Health Florida
2005 Corphealth Behavioral Healthcare Texas
2006 CHA Health Kentucky
2007 Compbenefits Georgia
2007 KMG Minnesota
Since those two golfers founded the company more than 46 years ago, Humana has grown to become the PGA Tour and Champions Tour’s Official Health Benefits Provider. Both PGA Tour player David Toms and LPGA golfer Nancy Scranton serve as Humana ambassadors. The business has over 11.5 million American customers, making it the largest Fortune 500 company today. Its corporate headquarters are in Louisville, in the Commonwealth of Kentucky, and it has generated more than $10 billion in market capital and $21.4 billion in revenue. Humana employs over 22,500 “associates” nationwide. In addition to having international business interests in Western Europe, it markets its health benefit consumer services all over the US. One of the Top 5 Most Admired Healthcare Companies in the United States, according to Fortune Magazine’s March 2007 issue, is Humana.
Humana’s ability to profit from the medical and healthcare industries has not always been painted in a favorable light. There has been widespread opposition to this commercialization of what people believe should be a social service as unethical. Even legal squabbles have frequently resulted from this.
In 1987, Humana sued NBC over a story line in the television medical drama St. Elsewhere where the hospital was to be sold to a for-profit medical corporation and renamed “Ecumena”, with subsequent changes to the hospital, both positive and negative, emanating from that change. Humana compelled NBC to air a disclaimer at the beginning of the September 30 episode stating that the drama had absolutely no connection to Humana. A news report on that states:
a federal tribunal in Paducah, Kentucky… ruled that NBC issue a disclaimer before last night’s episode of “St. Elsewhere” explaining that the hospital drama has no relationship with The for-profit hospital network Humana Inc. is renowned for its work on the artificial heart.
The plot of this season involves fictional St. Elsewhere has been sold to a for-profit medical corporation that has renamed the hospital “Ecumena.” The new owners have made improvements to the shabby inner-city Boston hospital, but the corporation is also not as compassionate toward the poor and uninsured as …
On May 30, 1996, Linda Peeno, a contract employee for Humana for nine months, testified before Congress about the drawbacks of managed care.
She began by making a public confession:
I killed a man in the spring of 1987 while working as a doctor. Although many people were aware of this, I haven’t been called to account for it in a court of law or in a professional or public setting. In fact, just the opposite occurred: I was “rewarded” for this. It helped me gain a better reputation at work and paved the way for my subsequent promotion. Not only did I demonstrate I could indeed do what was expected of me, I exemplified the “good” company doctor: I managed to save $500,000..
I contend that “managed care,” as we currently know it, is inherently unethical in its organization and operation. Furthermore, I maintain that we have an industry which can exist only through flagrant ethical violations against individuals and the public
On the June 21, 2007 episode of Amy Goodman’s Democracy Now! radio/television program, Peeno further claimed that “just within a day or so of the refusal of the heart transplant, “I was informed as I observed a sculpture being placed in the rotunda of Humana’s corporate headquarters… that it had cost about the same as the heart transplant that we had denied… Later on, I discovered that the sculpture cost $3.8 million… equivalent to eight heart transplants.”
A video of Linda Peeno’s testimony appeared in Michael Moore’s 2007 documentary Sicko. In a statement about the movie, Humana declared that Peeno was never a Humana associate, but rather a “part-time contractor”. The patient’s particular healthcare plan didn’t cover heart transplants, so Humana argued, so the denial of coverage was legitimate. Humana also disputed the portions of the congressional testimony that were displayed.
Humana was also featured in Season One of Moore’s The Awful Truth, shown refusing to give a pancreatic failure sufferer authorization for a transplant due to a contradictory policy that stated that all of this man’s diabetes related expenses were covered by his plan (his pancreas was failing due to his diabetes) but in another section, it said that it wouldn’t cover organ transplants. On the steps of Humana, Moore held a mock funeral for the man who would undoubtedly pass away without the transplant. Humana modified their policy three days later and approved the man’s care. This scene was the inspiration for Sicko.
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