Financial Data and Key Metrics Changes - Elevance Health reported third quarter GAAP diluted earnings per share of $5.32 and adjusted diluted earnings per share of $6.03, reflecting enhanced medical cost management and expense discipline [14][15] - Total operating revenue for the quarter was $50.1 billion, up 12% year over year, driven by higher premium yields and growth in Medicare Advantage membership [15] - The consolidated benefit-expense ratio was 91.3%, aligned with expectations, while Medicaid performance faced pressure from elevated acuity and utilization [15][16] Business Line Data and Key Metrics Changes - In Medicare Advantage, approximately 55% of members will be in four-star or higher contracts for the 2027 payment year, up from about 40% for 2026, indicating improvement in STAR ratings [8] - CarelonRx revenue grew 20% year over year, driven by strong momentum with large clients, while Carelon Services grew by more than 50% [17] - The ACA market is experiencing higher acuity, and the anticipated expiration of enhanced subsidies could significantly impact membership in 2026 [9][10] Market Data and Key Metrics Changes - Medicaid operating margin is expected to be modestly negative for 2025, with a decline of at least 125 basis points anticipated for 2026 due to elevated acuity and utilization trends [16][20] - The company expects a high single-digit decline in full-year operating margin for the ACA market, while commercial group business margins remain consistent with prior expectations [16][50] Company Strategy and Development Direction - The company is focused on lowering the total cost of care and improving member experience through an integrated clinical and benefits approach, leveraging value-based care [6][10] - Elevance Health is committed to disciplined capital allocation, balancing investment and growth with consistent shareholder returns, including share repurchases [12][13] - The company is investing in technology, particularly AI, to enhance member and provider experiences, aiming for long-term growth [34][38] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by rising medical and pharmacy costs and regulatory changes impacting coverage for millions of Americans [6] - The company is approaching 2026 with a prudent and practical posture, setting expectations that reflect current realities and uncertainties [7][22] - Management is confident in the strategy and execution, aiming for sustainable value for stakeholders despite a dynamic external environment [13][22] Other Important Information - The company is expanding external relationships and scaling pharmacy, behavioral health, and specialty care management, embedding value-based care principles throughout [9][10] - By year-end, over 10 million members will have access to the AI-enabled virtual assistant, enhancing access and engagement [11] Q&A Session Summary Question: Medicaid margin outlook and state discussions - Management discussed the expectation of a 125 basis point decline in Medicaid margins for 2026, driven by elevated acuity and utilization trends, and noted constructive conversations with states regarding rate adequacy [24][28][27] Question: Investment spending impact on 2026 - Management clarified that several hundred million dollars of investment is planned for technology adoption, Carelon expansion, and operational initiatives, which are expected to enhance long-term growth [32][34] Question: ACA membership impact from subsidy expiration - Management indicated that if enhanced subsidies expire, a material contraction in the ACA marketplace is expected, leading to lower enrollment and higher premium increases [41][45] Question: Medicaid membership outlook - Management anticipates a modest decline in Medicaid membership for 2026 due to ongoing re-verification processes and state program changes [75][76] Question: Medicaid coding trends and provider engagement - Management is actively working with providers to ensure accurate clinical documentation and is taking steps to improve oversight and compliance [81][84]

Financial Data and Key Metrics Changes - Elevance Health reported third quarter GAAP diluted earnings per share of $5.32 and adjusted diluted earnings per share of $6.03, reflecting enhanced medical cost management and expense discipline [14] - Total operating revenue for the quarter was $50.1 billion, up 12% year-over-year, driven by higher premium yields and growth in Medicare Advantage membership [15] - The consolidated benefit-expense ratio was 91.3%, aligned with expectations, while the Medicaid operating margin is expected to be modestly negative for the full year 2025 [15][16] Business Line Data and Key Metrics Changes - In Medicare Advantage, approximately 55% of members will be in four-star or higher contracts for the 2027 payment year, up from about 40% for 2026, indicating improved STAR performance [8] - CarelonRx revenue grew 20% year-over-year, driven by strong momentum with large clients, while Carelon Services grew by more than 50% [17] - The integrated medical pharmacy model and advocacy solutions are driving higher retention and expanded fee-based relationships in the commercial segment [17] Market Data and Key Metrics Changes - The ACA market is experiencing higher acuity, and the anticipated expiration of enhanced subsidies could significantly impact membership in 2026 [9] - Medicaid performance is under pressure from elevated acuity and utilization, with disenrollment concentrated among lower acuity members due to stricter eligibility reviews [15][16] - The company expects a high single-digit decline in full-year operating margin for the ACA business, while commercial group margins are expected to remain consistent with prior expectations [16] Company Strategy and Development Direction - The company is focused on lowering the total cost of care and improving member experience through an integrated clinical and benefits approach [6] - Elevance Health is committed to disciplined capital allocation, balancing investment and growth with consistent shareholder returns, prioritizing share repurchases [13] - The company is investing in technology, particularly AI, to enhance member and provider experiences, aiming for long-term growth [34][36] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by rising medical and pharmacy costs and regulatory changes impacting coverage [6] - The company is approaching 2026 with a prudent and practical posture, planning for at least a 125 basis point decline in Medicaid margins due to elevated acuity and utilization trends [7][20] - Management remains confident in the long-term growth algorithm, expecting 2027 to mark a return to a more balanced earnings growth profile [22][72] Other Important Information - The company is integrating recent acquisitions to expand Carelon's capabilities while maintaining a strong balance sheet to support growth objectives [20][13] - The company is proactively working with state partners on rate alignment and operational enhancements to ensure the sustainability of Medicaid programs [10][20] Q&A Session Summary Question: Medicaid margin outlook and state discussions - Management discussed the expectation of a 125 basis point margin decline next year, with ongoing discussions with states about affordability and program changes [24][28] Question: Investment spending impact on 2026 - Management clarified that several hundred million dollars of investment is aimed at technology adoption, Carelon scaling, and operational improvements, which are expected to enhance long-term growth [32][34] Question: ACA membership impact from subsidy expiration - Management indicated that if enhanced subsidies expire, a material contraction in the ACA marketplace is expected, leading to lower enrollment and higher premium increases [41][45] Question: Medicaid membership and revenue outlook - Management anticipates a modest decline in Medicaid membership in 2026 due to ongoing normalization following the redetermination process [75] Question: Medicaid risk pool shifts and coding trends - Management noted that elevated acuity and utilization pressures are impacting Medicaid margins, with ongoing efforts to improve coding accuracy and compliance [82][84]

Financial Data and Key Metrics Changes - Elevance Health reported third quarter GAAP diluted earnings per share of $5.32 and adjusted diluted earnings per share of $6.30, reflecting enhanced medical cost management and expense discipline [16][17] - Total operating revenue for the quarter was $50.1 billion, up 12% year over year, driven by higher premium yields and growth in Medicare Advantage membership [17][18] - The consolidated benefit expense ratio was 91.3%, aligned with expectations, while the Medicaid operating margin is expected to be modestly negative for the full year 2025 [17][18] Business Line Data and Key Metrics Changes - In Medicaid, performance was pressured by elevated acuity and utilization, leading to a projected decline of at least 125 basis points in margins for 2026 [18][22] - Medicare Advantage costs were marginally better than expected due to disciplined plan design, with approximately 55% of MA members in four-star or higher contracts for the 2027 payment year, up from about 40% for 2026 [8][18] - CarillonRx revenue grew 20% year over year, driven by strong momentum with large clients, while Carillon Services grew by more than 50% [20][21] Market Data and Key Metrics Changes - The ACA market is expected to face significant membership impacts if enhanced subsidies expire, with independent estimates indicating lower enrollment and a higher morbidity risk pool for 2026 [10][54] - The anticipated expiration of enhanced subsidies would significantly impact membership in 2026, with the company prepared to work with states to ensure continued access for consumers [10][54] Company Strategy and Development Direction - The company is focused on lowering the total cost of care and improving member experience through an integrated clinical and benefits approach, leveraging value-based care [5][6] - Capital deployment remains a key lever for long-term earnings growth, with a commitment to disciplined capital allocation and returning capital to shareholders through share repurchases [14][21] - The company is prioritizing durable, long-term performance over near-term expense leverage, with targeted investments in AI and digital tools to enhance member and provider experience [25][41] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the dynamic external environment and emphasized a prudent approach to planning for 2026, with expectations for continued challenges in Medicaid [15][22] - The company expects 2026 to be a low point for Medicaid margins, with a return to a more balanced earnings growth profile anticipated in 2027 [25][84] - Management expressed confidence in the strategy and execution, aiming to drive sustainable value for stakeholders despite external uncertainties [15][25] Other Important Information - The company is integrating recent acquisitions and focusing on operational efficiency to sustain growth and enhance performance across the enterprise [20][21] - The company has made significant investments in technology and operational initiatives to improve star ratings and member engagement [41][42] Q&A Session Summary Question: Medicaid margin expectations and state discussions - Management discussed the challenges in Medicaid margins, indicating a slight negative margin for 2025 and a projected decline of at least 125 basis points for 2026, with constructive conversations with states about improving affordability [27][30][34] Question: Investment spending and its impact - Management clarified that several hundred million dollars in investments are planned for 2026, focusing on technology adoption, Careline investments, and operational initiatives to enhance long-term growth [39][40][41] Question: Impact of enhanced subsidies on ACA membership - Management indicated that if enhanced subsidies expire, a material contraction in the ACA marketplace is expected, leading to lower enrollment and a higher morbidity risk pool for 2026 [50][54] Question: Medicaid membership outlook - Management expects Medicaid membership to decline modestly in 2026 due to ongoing normalization following the redetermination process and state program changes [87][88] Question: Variability in Medicaid performance by state - Management acknowledged variability in Medicaid performance across states and indicated a willingness to exit contracts if financial expectations are not met [70][72]

Elevance Health (NYSE:ELV) Q3 2025 Earnings Call October 21, 2025 08:30 AM ET Speaker1Ladies and gentlemen, thank you for standing by and welcome to the Elevance Health third quarter earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session where participants are encouraged to present a single question. If you wish to ask a question, please press star then one on your telephone keypad. You will hear a prompt that you have been qu ...

Elevance Health (NYSE:ELV) Q3 2025 Earnings Call October 21, 2025 08:30 AM ET Speaker0Ladies and gentlemen, thank you for standing by, and welcome to the Elevance Health Third Quarter Earnings Conference Call. This time, all participants are in a listen only mode. Later, we will conduct a question and answer session where participants are encouraged to present a single question. As a reminder, today's conference is being recorded. I would now like to turn the conference over to the company's management.Plea ...

Elevance Health Tuesday said third quarter net income rose to nearly $1.2 billion despite rising costs in its government subsidized health insurance plans, the company announced Oct. 21, 2025.Elevance HealthElevance Health Tuesday said third quarter net income rose to nearly $1.2 billion despite rising costs in its government subsidized health insurance plans.Like many of its rival health insurers, the company has been battling rising medical expenses from customers in its health plans. Tuesday’s results re ...

Elevance Health 3Q 2025 Earnings Presentation October 21, 2025 Key Highlights 1. See "GAAP Reconciliation" on slides 12 and 13 herein. 3Q 2025 Results & 1 2025 Outlook Elevance Health third quarter operational results consistent with expectations 2026 Considerations Providing insight into key planning assumptions; earnings guidance to be set in January: Strategic Focus 3 Areas 2 2 • Benefit expense ratio of 91.3% in line with revised outlook • Adjusted diluted EPS1 of $6.03 reflects ~$1 of higher net invest ...

By Sneha S K and Sriparna Roy (Reuters) -Elevance Health on Tuesday beat Wall Street estimates for third-quarter profit as the health insurer managed to keep medical costs in check, sending its shares 3% higher in premarket trading. Several insurers such as Elevance, UnitedHealth and Centene have warned of elevated costs across government-backed plans following increased demand for healthcare across the United States over the last two years. Despite a dynamic healthcare environment, Elevance's results w ...

LOUISVILLE, Ky.--(BUSINESS WIRE)--Humana announces 2026 Medicare Advantage plans designed with veterans in mind. Humana USAA Honor Giveback Plans elevate mental health support. ...

Corporate Finance and M&A Activity - Coinbase (COIN) is set to acquire the crypto-investing platform Echo for approximately $375 million, marking its eighth acquisition this year and reflecting its active expansion amid favorable U.S. cryptocurrency policies [2][9] - Hon Hai Precision Industry Co. Ltd., a key supplier for Apple (AAPL), has mandated banks for its inaugural Euro bond sale, which could provide new capital to support operations and expand capabilities within the global technology supply chain [3][9] Q3 2025 Earnings Season Highlights - Elevance Health (ELV) reported adjusted earnings per share (EPS) of $6.03, significantly exceeding the estimated $4.93, with revenue of $50.09 billion surpassing the $49.38 billion estimate, although medical membership was slightly below projections [4][9] - Danaher (DHR) posted adjusted EPS of $1.89 against an estimated $1.72, with revenue of $6.1 billion exceeding the $6.01 billion estimate, reaffirming its full-year adjusted EPS outlook in the range of $7.70 to $7.80 [5][9] Currency Markets and European Politics - The USD/JPY currency pair extended its gains by 0.8% to reach a one-week high of 151.95, reflecting ongoing dynamics in global foreign exchange markets [6][9] - French President Emmanuel Macron reiterated the possibility of a referendum on pension reform, emphasizing its importance despite recent indications from Prime Minister Sebastien Lecornu to suspend the reform until after the 2027 presidential elections [7][9]