Humana reported a wider fourth-quarter loss as medical costs continue to rise, the health insurer said Thursday. The company warned that 2026 earnings could decline sharply due to lower quality ratings of its Medicare plans. Rising healthcare expenses have pressured profit margins across the industry.

Humana's financial results reflect broader challenges in the Medicare Advantage market, where quality ratings directly impact government reimbursements. The company's Medicare plans received lower scores from regulators, which could reduce federal payments and hurt future profitability. This follows a pattern of increasing medical costs affecting insurers nationwide.

The earnings warning sent Humana's stock price lower in after-hours trading. Investors reacted to the double challenge of higher medical costs and potential revenue losses from quality rating downgrades. The company faces pressure to improve plan performance while managing expenses in a competitive healthcare environment.