Humana says government shutdown delays military health payments


Oct 8 (Reuters) - Humana Inc, the managed carecompany, said on Tuesday the U.S. government shutdown woulddelay payments related to its military health services contractand that it could be liable for up to $175 million worth ofclaims if the payments do not come through.

Humana provides administrative services to the governmentfor healthcare, with the federal government covering the cost ofthe benefits and associated risk.

In a regulatory filing, Humana said it was notified by thegovernment on Oct. 2 it had permission to continue administeringthe contract for two weeks, but would not receive paymentsbecause the Defense Health Agency did not have legal authorityto make them.

The agency said once funding authority is received, paymentswill be accelerated and paid with interest, according to Humana.

The company said it could be liable for the claims duringthe period if the agency does not reimburse it once the shutdownhas ended. It also said it does not believe that will have amaterial impact on its financial position.

Humana shares were off 4 cents at $94.67 in morning trading.

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