Molina Healthcare, Inc. (NYSE:MOH) Q1 2023 Earnings Conference Call April 27, 2023 8:00 AM ET Company Participants Joe Krocheski - SVP, IR Joe Zubretsky - President & CEO Mark Keim - CFO Conference Call Participants Josh Raskin - Nephron Research Stephen Baxter - Wells Fargo Justin Lake - Wolfe Research Nathan Rich - Goldman Sachs Scott Fidel - Stephens Michael Hall - Morgan Stanley George Hill - Deutsche Bank A.J. Rice - Credit Suisse Calvin Sternick - JPMorgan Sarah James - Cantor Fitzgerald Steven Valiqu ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission file number: 001-31719 MOLINA HEALTHCARE, INC. (Exact name of registrant as specified in its charter) (State ...

Financial Performance - Molina Healthcare reported premium revenue of $30.883 billion for the year ended December 31, 2022, an increase of 14.3% from $26.855 billion in 2021[16]. - Total revenue for Molina Healthcare reached $31.974 billion in 2022, up from $27.771 billion in 2021, reflecting a growth of 15.8%[16]. - The company achieved a net income of $792 million in 2022, compared to $659 million in 2021, representing a year-over-year increase of 20.1%[16]. - Total dividends paid to the parent company amounted to $668 million in 2022[36]. - The company received $668 million and $564 million in dividends from regulated health plan subsidiaries during 2022 and 2021, respectively[142]. Membership and Enrollment - As of December 31, 2022, Molina Healthcare served approximately 5.3 million members, an increase from 5.199 million members in 2021[14][19]. - The company added approximately 750,000 new Medicaid members since March 31, 2020, primarily due to the suspension of redeterminations for Medicaid eligibility[76]. - The company expects Medicaid enrollment to decline after April 1, 2023, as states resume normal enrollment operations[76]. - The company estimates it will retain approximately 50% of the new Medicaid enrollees gained during the COVID-19 pandemic, but this is subject to uncertain variables[136]. Medicaid and Medicare Segments - The Medicaid segment contributed $24.827 billion in premium revenue for 2022, up from $20.461 billion in 2021, marking a growth of 21.6%[20]. - The Medicare segment reported premium revenue of $3.795 billion in 2022, an increase from $3.361 billion in 2021, reflecting a growth of 12.9%[20]. - Medicaid premium revenue constituted 80% of consolidated premium revenue for the year ended December 31, 2022[40]. - The company recognized approximately $197 million for the impact of risk corridors in 2022, down from $323 million in 2021[77]. - Medicare program PMPM premium rates ranged from $840 to $3,900 for the year ended December 31, 2022[63]. Contracts and Acquisitions - Molina Healthcare successfully retained all government contracts in 2022, with significant procurement wins in Texas, California, and Nebraska expected to enhance future growth[24][25][27]. - The company completed acquisitions that are projected to add approximately $10 billion in annual premium revenue, including the acquisition of AgeWell New York and My Choice Wisconsin[24]. - Iowa health plan awarded a four-year Medicaid managed care contract expected to begin on July 1, 2023[28]. - Mississippi health plan awarded a four-year Medicaid Coordinated Care Contract expected to begin on July 1, 2023[29]. - Acquisition of My Choice Wisconsin for approximately $150 million to enhance Long-Term Services and Supports business, expected to close in mid-2023[30]. Operational Efficiency - Molina Healthcare's Medical Care Ratio (MCR) improved slightly to 88.0% in 2022 from 88.3% in 2021, indicating effective management of medical costs[16]. - The overall medical care ratio for the year ended December 31, 2022, was 88.0%, and a one percentage point increase would have reduced net income per diluted share by approximately $4.04[180]. - The company emphasizes primary care physicians as the central point of care, which has proven effective in coordinating medical care for members[98]. - The company utilizes predictive analytics and member assessment processes to tailor programs for high-quality, affordable care[100]. Market and Competitive Landscape - The Medicaid managed care industry is subject to ongoing changes, with competition based on size, location, and quality of service[110]. - The Medicare market is highly competitive, with major competitors including CVS Health Corp., Humana Inc., and UnitedHealth Group Inc.[111]. - The company is subject to various fraud and abuse laws, including the federal False Claims Act, which can lead to significant penalties for violations[119]. Risks and Challenges - The termination of enhanced federal matching funds may result in Medicaid rate cuts, potentially reducing revenues and profit margins[139]. - The company operates with very low profit margins, and small changes in operating performance could disproportionately impact reported net income[141]. - The company faces risks from unforeseen changes in pharmaceutical regulations that may adversely affect revenues and operations[148]. - Cybersecurity threats pose a risk to the company's information systems, potentially leading to increased costs and reputational harm[163]. - The company is exposed to risks associated with outsourcing services to third parties, which may lead to operational vulnerabilities[162]. Employee and Corporate Culture - The company announced a transition to a permanent remote work environment for nearly all employees and enhanced benefits for 2023, including paid parental leave[123]. - The company is focused on employee development, diversity, equity, and inclusion, aiming to become a destination employer in the healthcare industry[124]. - As of December 31, 2022, the company had nearly 15,000 employees, reflecting the diversity of the members and communities served[122]. Compliance and Internal Controls - The company has identified material weaknesses in internal controls over financial reporting in the past, which could lead to material misstatements in financial statements[202]. - The company has experienced HIPAA breaches in the past, affecting over 500 individuals, which could result in significant liability[144]. - Encounter data accuracy is critical for compliance and premium rate determination, and challenges in obtaining complete data could lead to financial penalties[195]. - The complexity of Medicaid contract provisions can create uncertainty around revenue recognition, potentially impacting financial results[175].

Molina Healthcare, Inc. (NYSE:MOH) Q4 2022 Earnings Conference Call February 9, 2023 8:00 AM ET Company Participants Joe Krocheski - SVP, IR Joe Zubretsky - President & CEO Mark Keim - CFO Conference Call Participants Josh Raskin - Nephron Research A.J. Rice - Credit Suisse Justin Lake - Wolfe Research Calvin Sternick - JPMorgan Scott Fidel - Stephens Michael Hall - Morgan Stanley Stephen Baxter - Wells Fargo Nathan Rich - Goldman Sachs Gary Taylor - Cowen Steven Valiquette - Barclays Kevin Fischbeck - Bank ...

Financial Data and Key Metrics - Q3 2022 adjusted earnings per diluted share were $4.36, representing 54% YoY growth [9] - Consolidated medical care ratio (MCR) for Q3 was 88.4%, adjusted G&A ratio was 6.9%, and pretax margin was 4.3% [9] - Year-to-date MCR was 87.9%, adjusted G&A ratio was 6.9%, and pretax margin was 4.5%, in line with long-term targets [10] - Full-year 2022 premium revenue guidance increased by $500 million to $30.5 billion, with adjusted EPS guidance raised to at least $17.75 [14][36] Business Line Performance - Medicaid, representing 80% of revenue, reported a year-to-date MCR of 88.2%, reflecting strong medical cost management [11] - Medicare, representing 12% of revenue, reported a year-to-date MCR of 87.4%, in line with long-term targets despite COVID-related cost pressures [12] - Marketplace, representing 7% of revenue, is on track to return to profitability in 2022, with a Q3 MCR of 86.3% [13][30] Market Performance - Medicaid rate environment remains stable, with COVID costs tempering and strong execution on medical cost management [11] - Medicare niche serving low-income members continues to grow organically, with a year-to-date MCR of 87.4% [12] - Marketplace strategy focuses on stability, with no ambitious growth targets, and is expected to achieve mid-single-digit pretax margins [68][69] Strategy and Industry Competition - The company is executing a long-term growth strategy, with recent RFP wins in California, Iowa, and Nebraska expected to add $5.8 billion in annual premium revenue and $3 EPS at full run rate [15][17] - The company is preparing for significant expansion in California, with a 15-month build-out plan to handle new membership growth [17] - The company remains confident in its ability to win additional state contracts, with ongoing RFP submissions and business development initiatives [19] Management Commentary on Operating Environment and Future Outlook - Management highlighted strong Q3 performance, with premium revenue growth and realization of embedded earnings from 2021 [9] - The company expects 2023 to be a year of scaling operations for new revenue growth, with one-time nonrecurring expenses of $0.75 per share [22] - For 2024, the company anticipates premium revenue growth drivers, including organic growth, RFP wins, and acquisitions, leading to at least $37 billion in premium revenue [24] Other Important Information - The company has a strong balance sheet, with $298 million in parent company cash and substantial debt capacity to support growth strategies [33] - The company expects to achieve full run rate target margins by 2025, with significant fixed cost leverage from new contract wins [21][54] Q&A Session Summary Question: Preparation for LA County contract implementation - The company is confident in its ability to scale operations for the LA County contract, leveraging its 40-year presence in California and existing infrastructure [45] Question: Components of $1.7 billion organic growth - Organic growth is driven by a combination of membership and rate growth, with 3-4% annual growth expected, primarily in Medicaid and Medicare [49][50] Question: Margin ramp-up on new contract wins - The company expects new contract wins to achieve a 4% pretax margin, with conservative assumptions on fixed cost leverage and potential rate adjustments [53][54] Question: COVID and flu impact on utilization - The company maintains its outlook for $2.50 per share in COVID-related costs, with a normal flu season expected to cost $40 million+ [57][58] Question: Rate environment and Medicaid premium returns - The rate environment remains stable, with traditional processes for establishing cost baselines and trends [61][62] Question: Marketplace margins and growth strategy - The company aims for mid-single-digit pretax margins in Marketplace, with no significant growth expected due to strategic pricing for margin rather than market share [68][69] Question: Redetermination impact and recapture potential - The company expects $1.6 billion in revenue loss from redeterminations, split evenly between 2023 and 2024, with potential upside from recapturing members in Marketplace [73][74] Question: Embedded earnings power and redetermination dynamics - The company clarified its embedded earnings power, with $5.75 per share expected by 2025, and no significant margin impact anticipated from redeterminations [76][77][82] Question: LA County contract protest scenarios - The company is preparing for full implementation of the LA County contract, with no speculation on potential outcomes of ongoing protests [89][93] Question: RFP success factors and transferability to future RFPs - The company attributes its RFP success to a well-developed business unit with a playbook focused on state-specific needs and referenceable national capabilities [96][98] Question: Marketplace strategy amid market exits - The company does not expect significant membership growth from market exits, as it has priced for margin rather than market share [99][102] Question: Potential for Marketplace growth in California - The company sees potential for Marketplace growth in California but has not included it in current estimates, focusing first on Medicaid implementation [104][105] Question: M&A environment and capital allocation - The company remains active in M&A, with a robust pipeline and ample capital capacity to support growth through acquisitions and organic expansion [108][110][111] Question: Tailwinds and headwinds for 2023 - The company highlighted potential tailwinds from embedded earnings, organic growth, operational catalysts, and rising interest rates, with headwinds from redeterminations and pharmacy carve-outs [115][117] Question: Medicare Advantage growth outlook - The company expects low-teens growth in Medicare Advantage, focusing on low-income niches and leveraging its Medicaid footprint [121][122]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission file number: 001-31719 MOLINA HEALTHCARE, INC. (Exact name of registrant as specified in its charter) (S ...

Molina Healthcare, Inc. (NYSE:MOH) Q2 2022 Earnings Conference Call July 28, 2022 8:00 AM ET Company Participants Joe Krocheski - Senior Vice President of Investor Relations Joe Zubretsky - President and Chief Executive Officer Mark Keim - Chief Financial Officer Conference Call Participants Josh Raskin - Nephron Research Matthew Borsch - BMO Capital Markets Stephen Baxter - Wells Fargo A.J. Rice - Credit Suisse Nathan Rich - Goldman Sachs Kevin Fischbeck - Bank of America Michael Hall - Morgan Stanley Geor ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission file number: 001-31719 MOLINA HEALTHCARE, INC. (Exact name of registrant as specified in its charter) (State ...

Molina Healthcare, Inc. (NYSE:MOH) Q1 2022 Earnings Conference Call April 27, 2022 8:00 AM ET Company Participants Joe Krocheski ??? Senior Vice President-Investor Relations Joe Zubretsky ??? President and Chief Executive Officer Mark Keim ??? Chief Financial Officer Conference Call Participants Ben Rossi ??? BMO Capital Markets Kevin Fischbeck ??? Bank of America Steven Valiquette ??? Barclays Justin Lake ??? Wolfe Research Nathan Rich ??? Goldman Sachs Michael Hall ??? Morgan Stanley A. J. Rice ??? Credit ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission file number: 001-31719 MOLINA HEALTHCARE, INC. (Exact name of registrant as specified in its charter) (State ...