(Reuters) -Health insurer Humana Inc joined larger rival UnitedHealth in warning of a jump in medical costs this year due to higher-than-expected demand for surgeries and other medical procedures.
Claims for health insurance are on the rise as staffing shortages ease at hospitals and the elderly catch up on missed hip and knee replacements as well as other non-urgent surgeries that they had delayed during the pandemic.
Humana said on Friday it now expects its medical loss ratio – the percentage of claims paid out compared with premiums collected – at the top end of its full-year projected range of 86.3% to 87.3%.
UnitedHealth had flagged higher costs earlier this week following an increase in surgeries among older adults, wiping out billions in the market capitalization of health insurers including Humana.
Humana also pointed to elevated demand for outpatient surgeries and dental services, as well as strong inpatient demand in recent weeks, a trend it said was diverging from historical seasonality patterns.
The health insurer focuses on offering government-backed health plans, including Medicare Advantage.
(Reporting by Leroy Leo in Bengaluru; Editing by Anil D’Silva and Devika Syamnath)