Elevance Health (ELV) 31 Oct 182018 Q3 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to the Anthem Third Quarter Results Conference Call. At this time, all lines are in a listen-only mode. Later, there will be a question-and-answer session; instructions will be given at that time.

As a reminder, this conference is being recorded. to conference like company's to now management. would turn over the the I

welcome quarter President Felicia Relations. Anthem's This morning, our Division; Boudreaux, to Good and and John CEO; third Commercial this are Rigg, Gallina, and President President Business and us Pete is Vice of XXXX our of Norwood, with Investor Haytaian, President And CFO; morning Gail quarter an Division. and Business the of will results, Chris call. overview around of earnings commentary Gail our third priorities. our John execution giving Government our will our call our our greater in updated then go begin metrics detail financial growth on over by outlook. followed XXXX discuss by focus financial and Specialty key enterprise-wide

be We available for Q&A. will then

we antheminc.com. non-GAAP are GAAP comparable of the measures. most to at will measures measures During certain website Reconciliations the our reference non-GAAP these directly available on call,

to be cautioned beyond of uncertainties this the actual today's filings listeners difficult from making We materially can to of uncertainties, SEC. Gail. to I on discussed many the press with the predict some which statements statements factors We risks These Anthem. our expectations. certain control and to generally and these over will subject carefully turn to current that results cause release call also risks differ forward-looking and quarterly review risk in advise are our the are now Listeners and will call. are

quarter, adjusted businesses. XX% share across Individual fee-based and joining reflecting third Strong and other earnings prior-year than billion. quarter XXXX $X.XX, momentum XXXX our membership. Government increased call. revenue the reported our of Specialty earnings revenue grew you reduction third $X.XX quarter our share execution Thank more more increased within quarter engagement growing improved in the of for per in products, programs, $XX Today, our over earnings prior-year everyone. us our quarter of operating enterprise for over Administrative per Business growth morning, business. fees third Anthem's than Anthem's reflecting Good GAAP clinical we to offset growth the planned X% sales and and of

membership quarter in fourth to the quarter. expect we accelerate expectations, growth Third and met

medical of performance value-based Specialty closing and integrated third was strong Health integration the medical is Whole and and our Our arrangement. which in reflects Anthem's cost delivers gaps costs. reducing quarter our care impact care Connection, across product clinical

program exams. has the through Over over vision helped XX,XXX this last alone, diabetic year identify

reflecting XX% earnings Our a XXXX outlook share adjusted XXXX. increase now from per $XX.XX, than greater is

and changes programs, investments beyond. of in for result focused meaningful, guidance revised cultural creating a the and direct believe further cost-effective execution, introduction of we the XXXX innovative, Our and the solid in and improve new on provide XXXX of including existing changes XXXX assets is a scaling growth clinical force foundation enterprise-wide made we've sales to solutions automation, We CareMore. implemented healthcare We're consumers. for like

items member within from use stores Walmart, of to access and convenient, online. for launching flexibility plan allowances health-related purchase medications their of in gives to over-the-counter collaboration Walmart's the Advantage with Medicare our Our to and XXXX, January and miles demonstrates Americans seniors. a Today, healthcare partnership of our store, driving affordable commitment more live our than to our XX% XX Walmart X,XXX

Overall, offering Advantage stable designed and person feature significant care. include our XXXX benefits Medicare XXXX position to Our us for well mid-double digit medical pharmacy whole plan to margins. Medicare design address Advantage and growth benefits enhancements both competitive and ancillary

XXX,XXX quarter call, our the quarter on expect of in first membership second business total group Medicare now earnings highlighted XXXX. As momentum accelerating, and we exceed is Advantage in we to the

penetration of result brand, Blue and industry-leading relationships. a is in business winning the strong consumer market, in success our Our deep commercial

new largest are scores that business commercial brand in rating with trusted many uniquely-positioned Quality multiyear the the Star by impact group were a for the announced in disappointed segment. captive of pipeline the Medicare we and We're from recently As for CMS, XXXX. accounts, payments growth will benefit which

approximately Medicare to medication Star management, of improve year. steps outcome go Blue Strategy, (XX:XX) deploying Advantage and pharmacy our member believe incremental eligible XXXX and expected dual will partnership XXX,XXX to [Blue our quality, members. capital live In will Blue payment Cross in an is we're (sic) and Shield] the clinical As and December We Blue the experience. to overall for Minnesota Medicaid improved lead Stars with part segment, in Shield and these Cross serve the Medicaid

remains expansion XXXX Virginia the eligible quarter our in XXX,XXX Medicaid of estimated pro individuals. the serve to first commence continue In share to addition, on expect track of to the we and rata

quality ahead and behavioral with care. Looking a medically-complex of CareMore in CareMore's clinical and we our is differentiator growth important care, person significantly beyond medical delivery business to an target patients. affordability care XXXX to as and on program improved Medicaid more integrates leading whole focus

visits, model, fewer for days the XX% in disciplined and, remain our strategies In result XX% pricing spend As markets business, visits. fewer CareMore the our example, XX% fewer Commercial estimate of rational. specialist reported believe least hospital, ER and we at members a Tennessee, our are overall, in we our

our physical, for sales the strategic We've that technology dimensions broker broker financial solutions the delivering for partners that easier with investments valuable spiritual, members how Our partners address distribution capabilities it do technology. added portal improved we in and to to by digital and environment We've Anthem. strengthened our business is experience and and focus emotional, our improve make our work wellbeing. through simplified front-end social, with CRM our effectiveness of consumer end-to-end

with tools monitor their seamlessly equips necessary distribution and Anthem. medical Specialty new the platform digital sell, partners integrated business to renew, with our and Our

Act manage a greater to drives medical our to members on will be launch focused simplifies superior it segment. easier platform, of X,XXX packages will utilize a XXXX. for also and Anthem The by will offerings. for tool And employee separately enable than is to of programs to using year, products, our consumer including our early telehealth The are of than all growth that We've Anthem relevant and with employers benefits other make We doubled we generate this wellbeing Health on be anticipate cost fully-integrated solutions priced packages able with products LiveHealth and population. of Engage. and by to available with consumer-directed we've if through and appropriate The of XXX,XXX Act care Since Wise integrating Act and combinations launch We the of the interface. purchased employers consumers products care their savings. recent purchase suite standardized suite Wise predefined engagement first in will of time These expected lower services clinical strong by accelerate our value-based ease-of-use engagement. the this return the greater Online, employer quarter number Guide, health members Wise on deliver Engage, its a most allowing and Anthem By groups single saves Engage. setting. digital to Coach, redirecting Anthem and integrated Wellbeing medical leveraging solutions. affordability and solution, are healthcare subscribers

execution are episode. our and resonating business enhance our LiveHealth an growth lower The average of XX% generating sales designs and of shows class will and health in in of the drive to settings, care improve data per $XXX Commercial steps savings XXXX. chose competitiveness engagement health we've tools group product taken users, Online Our consumer

Lifestyle recently Health resources. powered and analytics management Our clinical by enable to Total case Digital launched are AI package complex deep Management real-time distinctive You program and referrals Total and offerings that disease

and built an running of seamless our tested and launch our January mid-XXXX. am track Overall, to will of Our fully environments. service and set of IngenioRx, a but center our pleased customer remains new dedicated to-date. IngenioRx we've our The not and experienced, is PBM the for build To-date, focused our of X, thousands delivering be up initiative and on with members. remains customers key with progress on I also PBM, just The plans team our launch execution required by very transition XXXX. technology out standup benefit up ongoing a

at gross will least through the of expect financial We XXXX. performance our quarter billion vast and our $X pharmacy has these The of savings more over will flow completed. for I customers shareholders. continue annually in pass our John to the at value been form our now concluding majority of of this of our healthcare, once affordable to call remarks to savings third to IngenioRx XX% assessment transition review before to will with of accrue deliver a least initial prepared more detailed an

good you, morning. and Gail, Thank

in XX.X acquisitions year. Gail America's we in in increasing as $X footprint, revenue members. the over membership share as of XX% the was and adjusted stable million third the individual results and The has was to net As with stated, our voluntary among strong million Adjusted other billion million decline of XX.X of reduce ACA XX% earnings prior quarter income the year-over-year per $X.XX. up financial versus XXXX quarter, reported revenue the $XX reflects of quarter our Operating fee-based revenue The increase organic X% strong year businesses, operating growth Medicare was an in billion, growth and of membership growth XX% resulted members, the which decision year-end quarter. our third comes quarter well individual to at in in despite to range in factors. our Medical a end the Xst since HealthSun XX.X our guidance we XXXX. maintained Choice, have prior

than lower prior-year and medical insurer when the XXX for in the expected health from the and basis quarter XX.X%, normalized down basis was quarter Our ratio XX points points year-to-year cost third fee.

Further, reduced reaffirming ratio the our of with by our XX We X.X% medical range midpoint. cost XX.X%. Local medical the expectation to an at have Group points basis to X.X% we loss trend midpoint being below guidance slightly are

are was capabilities. making strategic and SG&A between clinical product XX.X%, cost discipline a modernization, balance systems Our investments striking ratio in digital, and we

at SG&A XXXX XX range unchanged points. is or for XX.X%, Our plus basis guidance minus

with balance targeted the to Our ratio the with in cap range. XX% at remains of quarter, debt line end our strong our sheet at

third flow, quarter $XXX in common the expectations, $XXX in operating of the which nine is repurchased net shares the million of of stock X quarter, $X.X approximately million. income our the we cash months in totaling Operating or flow price share, year. times a of line first resulting cash During average at per weighted for $XXX X.X was million billion with

to to flow for cash $X expect of exceed continue billion XXXX. operating We all

was adjusted XX. Our rate quarter tax the X%. in

quarter, third is rate range As and the at in full anticipated, decreased tax guidance XX.X%. unchanged effective XXXX XX.X% year to our

due a gains to higher-than-expected the rate of insurer nature tax skews lower. the our As health fee, operating reminder, nondeductible

operating quarter third in growth and for year. the balance the reflect results maintain we Our expect to stronger-than-anticipated gain momentum of our

we pass to XXXX be our back adjusted greater result, now As $XX.XX. call than now expect per the I Gail. over a earnings will share to

strength. a We're of entering in position XXXX Thanks, John.

as XXXX a want improvements year. organization, expect of to ongoing to we made As intend over to have our I much recent which and several XXXX will an and sustain result year, We a call, in but on quarter we highlight offer last factors more enterprise-wide fourth our do financial investments. performance our detailed impact next significant outlook the earnings momentum

opportunities. include Medicare, ongoing and Our and insurance distance ongoing benefit include the and initial the XXXX our Tailwinds Medicare from challenges manageable headwinds deployment, regulatory view fee. insurer businesses, from the dilution group growth. the to capital uncertainty investments of growth revenue contemplates fee-based health this in drive health expected and Advantage, Commercial, future and increased accretion Key and in timing fee, of XXXX Medicaid new both to from contracts growth related accelerate

consensus share growth the to guidance, with we'll open of XXXX earnings long-term target. per slightly operator, together below low And is and, in our double-digit questions. to Taken XXXX EPS our context the core that, up current revised high-single it adjusted

you. Thank

the from ahead. Lance question of Wilkes first go from Sanford Bernstein. line Your comes Please

morning. good Yes,

to what the impacts of a are in I'm you're of is both question as and magnitude any going the XXXX; to partial on and PBM in XXXX will be you're should pricing color interested then for year outlook XXXX. XXXX? get you the full XXXX then in little a about of just and as XXXX? with of first a all XXXX and PBM you headwinds [Technical about So, associated being in Could be PBM of as in we or the in thinking savings give advance in year, thinking beyond, the as benefit PBM them thinking of that And Difficulty] (XX:XX-XX:XX) benefit then we achieving XXXX being sort

sir, go on. standby. please right, ahead. gentlemen back and you're Ladies Please All

with ask to you – some Welcome our this address the question. his Lance first how a share had call. to there number let and sorry. technical We Gail and Boudreaux, your we're I address difficulties I'll wanted are Gallina back, will the components in commentary XXXX. then and me John XXXX with exiting PBM. I consensus And is there of around

business of XXXX, of terms we in positive First, very a our see feel momentum. overall, lot and about we

we see our in growth by our the and place $X.XX to on strengthening guidance $XX.XX, exit across XXXX, put based that increased As we've we initiatives we businesses.

will For and more, address – it's that low light momentum much other details. that business fourth to overall for and into the go have I components John guidance a But, guidance at within I'm the provide at appear of shared given how see premature XXXX. around XXXX, certainly to the quarter strong question bit consensus looking XXXX, aspire detailed on our PBM to some growing. that of our given as calls, call, EPS guidance and again, XXXX I growth to we going do specifically do your do does at stage we the high-single see We we other long-term we ask we that. to the more are impacts but this and you from always feel double-digit, think

back and related savings the rate premiums XX% expect you, to over delivered our to a in to XX% shareholders more I the appreciate commitments. XXXX question. to then almost billion obviously about and billion as of into morning, customers. of being contractual to and improved XXXX. we're run savings, under ESI going We've good convert $X Thank we fulfill that pricing commitments members ESI fulfill talked Gail, the XX/XX/XXXX. contractual Related and their number. the our We'll $X healthcare affordable Lance. is we'll through contract And with Related to more PBM, than that

X, will conversion new we later fully we you membership and XXX% the as that our no and viewed And XXXX. should migrated be expect platform so completed convert partial January the year, the throughout XXXX on way be than a question, the XXXX. asked

So, for partial XXXX. year

integration of our say in in bit other in the minimally the statements anything includes believe just Gail it strategies limitation that pricing, question fully with that. is a XXXX There now associated XXXX. we migration significant outlook has or a of there happened pricing previously as of that, consensus financial Anthem's baked right part little commentary reflected continue We've headwinds what in XXXX costs. future stated to that on to impact we other related have your aspects or has that. with headwind Now all minimal Gail's might was and And and and already associated and one-time the was reaffirmed the that certainly would with I'll be that out then terms had but our not is very in XXXX, associated XXXX expectations. light

Thank you.

please. question, Next

Your ahead. Steven Barclays. next go question of Please line the from from Valiquette comes

everyone. Thanks. Good morning,

in said just press rising the So, in were Government in release the costs medical you there some Medicaid. business

your to around around view thoughts that just what's Just temporary? whether curious release. you color more talk if going about do there's could in the get I Thanks. kind also want press there, more disclosure of categorically that on you and as either that

me the our the question, much we're we're too. with – very question. thank businesses. you Overall, of my let answered pleased where portfolio I last start Overall, very pleased very Well, with for

business, If we our year-to-date comparisons there's with points, for year. are too Medicaid, quarter-over-quarter MLR guidance you businesses. our and Medicare about with encompasses as at Government all improved solidly for again, by mind target in our a business XX the overall Keep into adjustments, our basis In typical in much look our within which wouldn't of in feel too read margins. line our this On very and business. performing particularly full Government year-to-date, Medicaid expectations that I is our we our out-of-period and Medicaid, business so performance the it's good always

about performing the So these certainly overall, within Thank are year-to-date expectations outlook and you. performance. feel we feel businesses good full-year the and

Next question.

some bit in know, of Any A.J. but like Credit of with Gail, LLC the some consumer in discussion Suisse. pursuing out I Your Rice next see further from laid you what – facing in of and - think some mentioned earlier also the with collaborations new then things year the Please prepared go you've long-term question the comes cross-selling the calls little you're Securities ahead. any business from line self-funded and you in there that on I about And Hi, the were discussions Maybe it Blues? a if opportunities there. further A.J. update Credit there's everybody. data remarks, in I'll initiatives and general was capabilities. of investments Suisse Rice seeing (USA) analytics

love them. So any on you've if out, there's or the initiatives update those other hear to laid

each we've focus I enterprise as J. I've execution changes our across areas. A. performance early feel some and of on so and the well key culture, we're of really across that. you couple One, Thank that across Covered our businesses, think think discipline as starting a of calls, that number about the these see structure performance of as things, I in a made shared quarterly positive to improving sort on Great. I of of our results

major on the area that of going on been to particular has who Coming we've growth. our Pete I And second some strong very Haytaian Commercial going been the then share business you the start to that businesses, first all has more in, some to invested The have felt to details. focus. sort of around of some ask specific leads investments. I'll growth I'm Anthem, places of with of start a assets our we and I'm across emphasis

space and intelligence capabilities, capabilities, shared the that in with clients with around will, to individuals and identify next that you systems there help think that environment. our we're clinical probably years, complex team about that's our in been a we've Artificial long-term the building little are lot there's business, over and of business. our investing in and in think this of of of spent our migration capabilities We business a sure the Government some growth. potential focused products. both the you because saw have a inside investing been serve which the time products making that of those product embedding products And we've on Commercial Specialty several actually in strong. of that the I both disappointed We work the Commercial opportunities our earlier we into those population and and came We've a bit allows announcement predictive that area our lot an We conditions. recent been consolidation in operating we our of again, year place us cross-sell sooner digital positioning improve of

the And saw in on area penetration that's bias. focus revenue that well think You we've we of pull-through we got uptick as our nice had where of clinical some Specialty quarter in opportunity. in as business put that, growth Pete that initiatives the of additional in I'm some share going that that's impact the place With some just of he's ask having. already to to the Commercial and an

Thank the you, you. question. for Yeah. A.J., Gail, thanks, Thank and

tick to that talk encouraged the of I'll just of last about by you in mentioned Commercial quarters of and some through things generally business. couple progress sort the think I've think over speaking making I I very the the we're progress. we're But

attracting encouraged that to with a strategy into by First start Number my about the we've two, talent; lot company our in talked with as segment field. as the we're the out both structure. respect well I'll team really talent

our and strategies all and force and respect have with can about Gail so and products, continue a that which We're we as that. providers the to we making development the development and match networks. consumer the like of sure about across we how to we most network be in across could the at sure making see to we XX I'm And sales progress being that standardization brokers, those. face effective great we also company regard. the that we like as talked smarter terms out have and have high-performing we're in market right that And we lot sure marketplace networks packages tools making. then with strategies encouraged really Excellence in quicker decision-making with we're looking underwriting, product underwriting and are best we're and to we're centralizing progress talked progress we're highest-quality engagement focused as the care regard the in of things in making the around deploying the then in finally, seeing our with our provider that that – products our to effective distribution, launching package on I've selling well agile then products, to we other building talked investments with states really continue by and and marketplace. as network costs how respect clinical effectiveness, build practices, I've development best Centers then making cooperative also as and our those see about So in engage as we

We enrollment. now as are to doing with respect things on a respect with to well as basis digital quotes

the much growth, momentum quarter-over-quarter happening So is improvement is we in as more move we as That perspective, in forward. encouraged we're we And into optimistic a what's going our a to market creating seeing first fashion that XXXX. see growth. by said, happening the XXXX and that's Gail quarter into occur and respect with local of translating, marketplace. We're electronic from cautiously are nice streamlined membership enrollment the in all

certainly as Pete. begin optimistic of the and think can underway Thanks, of build and And seeing for see, got XXXX a are we to lot to momentum going initiatives really we've you that. they're impact that

question, please. Next

comes question Ana Partners. Gupte Leerink Please ahead. next Your of go line from from the

contracting direct-to-provider GM a could Hey, TPA Henry as If directly follow-up morning. with is as Blue the doing Cross I and where Commercial some on Ford and Accounts something far we're seeing National just the Good goes of trends here. is thanks. like more

BlueCard moving in employers can exactly point? it's this platform the about at away the create like. Blues members; Castlight partnership and health XXX,XXX self-insured broadly Anthem do Amwell, Blue to is Samsung, satisfy and plans platform, beyond, and and from talked that doing What more with with engagement, on member a You can here the

hit Overall, that for National value-based will – touched of couple Well, thanks the question, first putting with. we're the let marketplace your began in positive each comprehensive start the which about to question. question Ana. the Very try the Account of with we I on you One, on place marketplace. in feel actually place more care. initiatives that around a quite Pete those. in networks me

cost that know, we our a across strongly Shield we Blue and we are sure system, have share Accounts. to integrated you can As Cross our also make with have advantage moving Blue and value-based arrangements we that National

that's been so, working on an that beginning initiative to it's and the across And we've system resonate.

performance bid overall a in for and grow year their National for the number waiting this we're that on marketplace, we in about interesting do Accounts, of the accounts see it year that was was for to of we incumbency, overall larger process. to but Our an expect and season coming of more close some terms in accounts the did of XXXX, XXXX

believe partnerships that positive expect, us that do question been and will the that is your Cross around market. launch huge priority of Shield broader in mine. has Blue we there a and our opportunity, of for a We IngenioRx Blue But

we XXX and Shield Blue one serve, across system We people Cross Blue Americans. three have in the over million that

we the experience One fully have Engage platform system our opportunity across I capabilities, think collaboratively digital our as our for And in platform have that access consumer well to improve The the and to to integrated healthcare. of we, us brands. as into is somewhat that and the strongest program. clinical work unique affordability an

a being platform; of deep who So it's a think opportunity. share it's opportunity want an It's that that in integration. what And able to an kind not stand-alone. I truly us others to to partnership just join is offers

on model CareMore of and the service worked some do. work through partners other clinical we of engaging as have our We programs well our several some through with as our Blue subsidiary

comments, good We're partnership. Account system, depth doing to being playing on focused we are that National we're contracting. So it question, your local to capabilities in the differentiating of couple plus maybe is already the Medicaid But our share very because in see a and in And lot example we the we of me more do bring opportunity about very and our think the for the back a we're Pete a that. partner ask how doing that specifically about let direct give and out market maybe partnership.

are on everything year-over-year year what's I Gail And with mean, XXXX. Yeah, to that just and National that no, the with we by around I am encouraged and to I collaboration construction a from happening. would with cooperation growth. Gail to extenuate of really it's will a see XXXX Blues; the conversations growth will see business we We're very incumbency, in said. nice the In agree the by point basis encouraged to networks. on that national respect made that going with Blues a high-performing see

there's real, board. making of so said, Gail like consumer and a customers. in our We can our our are the really an capabilities, locking on the across And and unified terms is arms networks that experience a experience and consumers making integration consistent around with sure building have that ease-of-use that we're theme basis then sure

in making encouraged So of competitors and of lot lot in by that working investment peers are regard. our a a We're we're environment. A really that. fragmented

capabilities all and together in an way, a meaningful so, is And integrated tools difference. bringing I these think,

Next question, please.

Your Lake go next comes question Justin the from Please Research. from Wolfe of line ahead.

morning. Good Thanks.

a have here. couple Just follow-ups

comments release mentioned earlier call. you your the medical of Medicaid a in the and adjustments, Gail, on press in First, on there's out-of-period been focus costs higher lot

guidance, benefit then to $X.XX commentary, single-digit the low occurred terms in a combination about the can think I kind us quarter? in of a we framework? of what growth XXXX of more give here but think you high on talked how on of it coupled to And So, double-digit the detail Is about think Thanks. previously. as about that HIF reasonable with, appreciate reasonable should you XXXX, is timing

Justin. Thanks,

say in First the would have what Medicaid, out-of-period that, it's terms again, typically to as pretty you I think about of all, guess, adjustments. I in Medicaid business

nine months ongoing full and expect timing So, full timing performance, expect look about continued to We've strong and at that year, it's the to you really the performance for see we normalize. year. we strong very as more our got

some I that XXXX meant going stage was into may back I'm be about detailed what around and go my John at your to So, think, in John again, a to per Medicaid. guidance I overall, comments not bit can comment more, little ask earnings really comments, this to I'll add but getting prepared guidance, but we're share commentary.

Good for morning, Thanks. thanks the Justin, Sure. and question.

XXXX, $X.XX with in fee $X.XX more headwind the a associated about I'll that bit fungible. is our were terms It's year. first, of year In address the current this other and HIF this operations,

So, and the a you're a a approaching modeling that looking way low at very rate I a then, to to double-digit point. much yeah, would adjustment appropriate is say I growth it are as And associated that starting with high-single point. $X.XX make think the that fair very starting we from perspective,

Thank you.

question Next please.

of from ahead. go Your the comes next question line Please Windley Dave from Jefferies.

morning. And re-procurement your a Iowa you if Texas? the for Medicaid kind increase Thanks. my good get relative Thanks questions. of comfort could or confidence about the with in of could that to Medicaid, positioning about more normal in then Texas, adequacy In in your does taking Iowa; you there to margin? talk plan talk your wondered Hi, if August rate in in

situations, it's within our in is of terms any again, platform strong Medicaid state Medicaid of our state-specific Well, comment we actually guidance though, – I into a won't specific margin. and position and really states, performing feel as sort we our on have very think XXXX, don't overall Overall we so target specific that we in situations. of go

we portfolio. overall, about feel comfortable So, our

about We XX we portfolio. have states, over business as a our so think complete

who just what's maybe little comment opportunities. pipeline and leads happening Government procurements, a I'll maybe about of terms In our business, various bit in our Norwood, Felicia to ask

you thank we and cancelled Good Certainly to as the the and respect procurement. state morning you. Texas, know, with issued Texas

We we would are robust. take this Medicaid remains today it procurement month. expect incumbent an on pipeline, the and look certainly we as that's forward to due When overall we move bid at very that a

that winning very maintain rate ability strong had as of success procurements, are and forward. a We have to confident continue to our terms we trajectory we go of in

Thank you very much. Great.

Next question, please.

Please Markets. Borsch of go from ahead. the Matthew comes Your Capital next BMO question line from

Thank Yes. you.

the on a touched as supposed, uncertainty, fee beyond insurer You I looking XXXX. health key

key the fee? sharing think milestones might mind in suspension in of Congress us, terms with elimination don't activity, a permanent of in of looking to further happen what you you or when you're terms perhaps that the are If that

sure Thanks for very the a and is feel good a types it's stability away. something we Matt. that the things We that quite that as sense really permanent advocating employers the I of affordability I'm really fee, suspension we of have feel that and not for and respond for the in the in reduction XXXX certainly those strongly marketplace, and don't strongly goes marketplace important. Obviously, happening. becomes health are that that it's ball that for appreciate how when only in question, to crystal the timing the are to great insurer

great and So something I Hill, don't have insight the cetera, with on views on the sort any that constantly It's our into on. of working we're administration timing. sharing and et

provide. specifics of lot whole a to not that, than there other So

please. question, Next

line Please the go from comes Research. ahead. question of next Nephron Josh Raskin Your from

Still in segment operating the half gain guess, growth Good of and then growth I looking through context Medicaid, struggling, the number X% a you of XX% the and to why Thanks. first understand year Government this year. of this quarter, called Hi. guess or XX% morning. out just I sort

big looks at it there. like So decent or in a a relatively least change number

program, just what just state or issue? that I was think out-of-period? et Why this should to not could specific we So us specific maybe to help exactly that'd understand contain go-forward If you a be helpful. a cetera, a you be could

in I Hey, to that within and operating can in adjustments, are there We have operating within always as timing is into results. said, our targeted going quarter-over-quarter is is clarify out result total, without heading This an John. you which with just business is the would Medicare we out-of-period well as issues, as you well ranges. as and unfortunately, we're Medicaid are the our do that XXXX, the operates and there there. Thank to our is whatever I didn't. appreciate go misleading nice momentum third ones honestly, the Yeah. our and really expectations, and are to and in ones ask way can to have as states and skew Quite general Medicaid XXXX gain But quarter-over-quarter satisfied and sometimes issues all XX Government the well misunderstanding out-of-period to at it to believe The occurred try for performance year-to-date a that that at and Gail that always may had not both business expectations opportunity the what think out-of-period out-of-period just annual know understanding through the of very very look list look look at in to question or be the occurred which and very, we're Josh. you the have that some XXXX. performance quarter

you. Thank

please. question, Next

comes question Lynch. from Kevin from the next go Bank line Please of ahead. of America Fischbeck Merrill Your

Great. Thanks.

to a So confirm follow-up. I just thing want guess and then one

lower mathematically perspective results in MLR confirm the that. little product, Medicare? better, gain tax So bit a just Commercial, your quarter so coming just trend can is that operating to give to little income when guys from is down and and coming the that? coming and just at How But then about look is rate, brings better it rate extent is bit better this is color what your higher the looks on tax some in is by think cost because should that it in want you we the a

Sure.

we operations insurer the lowered in is rate On the calculation. perform that be fixed given better tax you're the core as that the correct health in that mathematically, fact exactly number our tax, will our fee a

quarter operations tax quarter, small driven the in true-ups both return look from in that filing there associated third the in from the well true-ups as were benefited. couple outperformance also by outperformance – quarter was XXXX third with by the the the addition, small But strong as of tax return I'm quarter. at when XXXX the you we a did the the sorry In

increased we're area. in the strengthen So it's for guidance our our part $X.XX It's your reasons associated we lowered that basis continued really of our by the one very continued other clinical loss in question XX was, we points. that, momentum by strong bullish, ratio programs, of that's with the the then medical year. – And

giving trend to And are the bias our built all based cost rest those on reduce our a is midpoint. year. medical the Commercial us we of medical things which the for to combined, Our comfort loss the slightly group, below ratio guidance

Next please. question,

Your line next from of the question Please Charles Rhyee from comes go ahead. Cowen.

in consumer-facing Yeah. here question Gail, about and bit just the a spent the for taking a your a some talking time questions. platform, on comments. of Thanks follow-up your you Hey. of

You you the of about talked earlier about the talk client base. number with doubling sort Can Engage of members. penetration into

And expected you, What members early You experience, that facing? of terms in have are be the your is do market to think the XXX,XXX platform year. the in that as investments where regards? about consumer you talk target in mentioned next realistic say, want you part to you you far by of you're how along would ultimately then, making Thanks. these

color. I'll also more and to give Pete I'll then ask start bit Sure. little a

I pretty of think far terms along. we're capabilities, our In

strong and our accelerated Anthem and an AI of you We about Anthem complete investing those it digital was we're in component very those last year. building. when think capabilities one seen And been goal. we investments uptick, platform We a that's years. have have Engage mostly doubled customers January; in which some just platform in large Engage, the that self-insured launched We this our

significant a we million have penetration interesting that offering Again, just, again, members recent several in LiveHealth there's Online a is one opportunity that fairly several piece. that's close to opportunity. another – where launch. think I there, really So but

But have also not those at to just consumer like of clinical Promoter All our engagement, Scores. strong very programs. our Net I look but

a penetration help aspects. in and technology, about complex digital that that instances, I dental, also pretty six months The are of we're integrate touch patients all almost Whole sooner, significantly us their into Health a wanted our identify in remarks, in programs, piece last wellbeing but is not process integration but Our really that's on pharmacy, and interesting we're and some Anthem shared combination disability our clinical our we're just by case clinical care the with Connection. with our think in taking care I both the and to my interrelationships information way the bit is get vision, just number management to sooner community well have connecting a claims much share in the powered also that we as them gaps and prepared understand programs to to to identifying significant we our because a using our our and little of and care and local as AI where have earlier. patients them work And providers the of us, but office, where and in dentist's digital reason issues markets. capability, and we have also the our medical, across the in office, and again, in market our coordinate continuum, our we market deep access for works we physician's

we information we digital, release, that, press recent that, think I you We've we AI. but think is work about some significant would that did we say help So investments think partnerships. overall saw also to that's on working are team a a hired making around need I what that. will accelerate We in

them. resonating ask this But to that of maybe share bit like because them but that the our Pete the market market we're We with sort how I'll capabilities how a little got of just partners had. leapfrog it's our was of we've think to think – the about interconnectedness going number this system your things doc.ai. trying because the advance that a the I So across question and that's relationship also it also in – not core potential announced is we just

Yeah.

gamut. the through think Engage. experience platform consumer question, as I Gail it's and would ultimately attempting Charles. everything I the think integrate Engage user great a think we're into of really And our I to engagement covered doing

members our X.X programs. Just that million Engage. are in gaps and We're to health today of facts; give in viewing you our are some finding October, users users management of accessing XX% as care, benefits of XX%

So we're seeing engagement. good really

an ourselves you we're how Our trying NPS XX, the me of score perspective. around to use about specific associated from But feel with a differentiate really integration we so let Engage give is a example good there.

So health plans differentiating we're consumer-directed asked consumer-directed we ourselves, new, And that. Applives. you are that know how plans about not Anthem and call had (XX:XX) health we question so

– is bringing your disparate plan, that have so experience that financial products FSA, tools. associated health HSA, et products cetera, you one and or think a through our ultimately medical may we're what they'll Anthem but into We today services all together consumer-directed customers doing unified with different all have that's in ultimately about your million that X.X of – we're and consumer about integrating those specialty experience we're Engage services

technology. subscribers really about Applives talk advantage X,XXX taking plan. consumer-directed about may employers uptake differentiating Applives that XXX,XXX talked how folks experience over in versus we over fragmented that (XX:XX) our new (XX:XX) have integrated that's with of we're ourselves; Anthem we But ultimately as when today and health expecting So creating environment a a

much. very you Thank

question, please. Next

Your question Citi. of next from the Ralph from Giacobbe line Please comes ahead. go

Thanks. Good morning.

low commentary it so single, again. sort Just of line seeing guidance of on wanted of growth to seems I'm EPS XX.X%, with clear be consensus double. high in

on of out dilution off. Hoping kind as headwinds the called flesh just on you and you Thanks. And us think that maybe of can specifically sort that you the just out is we help you the what margin talked ramp the on group and So of comparing line coming much with and item about staying Medicaid. Medicare so about there. MA guidance, to growth consensus you're

you Yeah. for Good Sure, Ralph. the morning. question. Thank

of point. rate fact the had about the and is is terms think we think really long-term rate as jump-off the previous that a XXXX than the in raised that, high the have is a question from fee math into the in factoring starting associated HIF into And I greater growth low our earnings $XX.XX year, we our that to have our factor that a and we the expressed double real how in $X.XX the growth and digit question is guidance what in headwind how through And perspective. think that headwind to and off to XXXX And fee with back single that take guidance have of then point. add then referred on this $XX.XX. Now HIF previously $X.XX to from today results we've I that

headwind the Medicaid around headwinds/tailwinds, we actually have revolve both that mean group growth. other in In I because word a MA good very a for thing, is group the and terms growth they of the fact

what business item growing of on we and the over We lines the which provide a for growth the will the by line So size the with long-term will long-term. but say be us very with specifically basis, items line don't bullish very very item membership company. we're aspects for those believe profitable individual we're of bullish that

also those components just And we John. that provided. have I'll been that into add Thanks, factored the outlook

Next question, please.

of from next the comes Please Goldman from Steve line ahead. question Your go Tanal Sachs.

morning, morning. this wanted guys. color trend. Good for around Thanks I the all the guess, the commentary follow just cost on to up

of that, year great. on favorability initiatives you're maybe recently? versus a change to natural the sort it patterns more decelerated of trend to Group trend is just flavor us is read give maybe cost be as maybe fair and you that'd how trending perhaps of how comment having utilization the So seeing, suggestive for Thank outlook the the can within And Local you. this the also is much

very I we for very the associated ratio prepared midpoint points. the slightly fourth that Thanks, of think stated and to you are as our sure. Thank for being comments question. reduce Yeah, we guidance Steve. by our and Yeah, medical I are quarter had going meaningful the on basis the in trend bullish loss XX able with the trend, cost that's below

pretty much two-thirds in is then is increase others consistent cost yeah, that In price between most somewhere unit are terms the we're the the industry of rest XX% with and utilization. is and what pricing, versus of utilization and

have lower helping inpatient We that very that experience initiatives we of and settings. direct the that seeing hard an that the in We're care care continue one as have going on in that's days time. right example to more to cost the out-patient at the utilization appropriate care right work members very and getting right place ensuring our of well the bed reductions they're

Yeah.

trend mean, add as in a marketplace about place done your clinical to we have also I or and care; question this our lot program; value-based comment me John's John sort said, service. appropriate moving, is of occurring. natural to specific Let around what's of

there's trend out, the but be the that So goes and year of cost parse driver of to clearly so on unit biggest and continues to in and a lot each historically every system. that activity pressure

on we're very focus seen That's to have we utilization obviously focused and area to to ability to specialty very it. of the pharma. IngenioRx and actually an about trends continue over forward continue intense continues go We going inpatient positive – manage excited in down stay

but over stronger moving doing in of I really and parse today and arrangements we a forms overall XX% share – risk-taking. we care you much around lot think don't are have pieces our So more the risk moving to markets those under value-based

please. question, Next

Your ahead. line comes question Please from of the Gary JPMorgan. go next from Taylor

Good Two-part first one for enrollments morning. Hi. talked about XXX,XXX group question, quarter. on the MA, you

is flow of my for the for bad Cash I think that driven growth receivables has cetera catalyst million question John. payments little a is being the et wanted win guy the premium multi-state that timing that's contract confused year-to-date cash just up one the some by a that of CMS of then line one question having and think from flow I'm on been just a I impact, and Blue weaker. $XXX is issues been a cash I part just little second flow XX,XXX source understand of the the the little bit. exit the an that has under exchanges to large understand on but currently, is several? and by platform? question or was, And And

I'll questions that raised. of take Gary, the first then you me let flow MA group the part cash John address around your and question have

First, on thanks group for question MA. the

it's As about about and gotten group serious opportunity a Advantage, Medicare team the bullish you've in brought of very business heard, that resources. we've dedicated and we're very and a

question, XXXX. through from benefits we a this pipeline. we're MA that receiving so as looking are our an using is robust growth, inherently not products, into we at are today But – your the is very commercial have what that any that captive our attractive about we single both members broad-based Medicare-eligible of products are existing a through to think commercial driving that members well our I very is accounts RAP agents, as opportunity competitors though, Specifically client have pipeline and have book unique

very shared Blue with feel Cross and going see in are going safe forward. absolutely we an opportunity significant we Shield partnerships for morning we pipeline The numbers you forward. So, the Blue this well pretty that as us a

value. overall through the lifetime the think system These I them. it's are recognizes that Commercial we members we have keep and important their that had

part important forward. So we're another very I Medicare on strategy why of think our going about Advantage hit bullish you and group really

that, to John question. with ask So, address cash your I'll flow

business significant at Yeah. existed footprint marketplace. you that already out cash receivables; piece month have and lot one flow in we that paying on of reserves and payments bit income. On I of so flow. focused the little identified, flow of net primarily the we several coming it's but Thank the That a ACA on of factors on we was states year. that the in all Medicaid receivables strategic obviously premium and cash really reduce a the with moving They're that morning, flow Gary. our paid good states have just different good higher a having are you cash decision us a strong We of had of it's and that, pieces us and month timely having with individual versus reduce basis. out was arrears a actually still does our arrears getting claims there Even yeah, flow, our and slowdown think would've bit is is Medicaid The you obviously on very a the more think and, that's a some XX/XX/XXXX, expectations expectation balance called in the as with associated one driving cash our that collectible. obviously X very and run of cash times it part guidance receivable of lowered knew for to

for question. have time one We for

So please. question, next

Okay.

the final comes go Peter from from line Please of Costa Fargo. Wells ahead. Your question

– but XXXX My covered Thank for year couple well, like the you and you changes in I'd of squeezing here to of much about and me talk this question rest big at end. a XXXX very there. pretty

the of or the how feel then have business HRA First, you decided Medicare Commercial the Commercial first changes, you're business because business? impact in that the Trump's terms PBM, cost do going your you migrate whether you get when to going savings? to And matters that's President

question, Peter. the Thanks for

as shared remarks First, – rather, or I a in call we very have on prepared schedule. my the detailed

whole of cetera, like have cetera. it to number and that. as et to the We're et have which sure which testing, to benefit go guess from transition. business through going go period foremost are you into series scenarios migrates and suffice of that a to want processes, And absolutely of and states first specifics but not that I an of going it's know, other seamless We we approval worked we make things through of say at through kind time,

through that. to going we're So work

to the Haytaian HRA, terms ask answer your question of second In for Pete about you. I'll that

of I'd obviously last it appropriate in sort there that were probably as There's And there in proposals the lot very on that HRAs to we're I Pete. sustainability affordability address over say that. the to Thanks, focused read and of Yeah. out put place of that marketplace. specifically, obviously couple safeguards you've a relates think weeks. the

it don't and safeguards that it while concept, affordability that addressing risk to it into So is take in individual employers an inappropriately also push had there ensure the marketplace.

focused sustainability the how these we look the keenly very supportive marketplace, feel in things marketplace. affordability That's in about good on of also we but very at being So that. generally being

all for thank of Anthem's questions third this in your call. Thank you. and And conference quarter joining us you for morning

with I'm excited at the for about to want for associates individuals all Thank events. our Anthem, forward look we I those serve. thank their your and As and we of see, in of lie for well-positioned that future interest us. you you each commitment to Anthem ahead opportunities can I are you speaking of to and XXXX,

Thank Ladies your conference and for gentlemen, Executive using for that AT&T and does conclude your today. participation Teleconference. you for

You may now disconnect.