Elevance Health (ELV) 18 Apr 242024 Q1 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the Elevance Health First Quarter Earnings Conference Call. [Operator Instructions] As a reminder, today's conference is being recorded. I would now like to turn the conference over to the company's management. Please go ahead.

Good morning, and welcome to Elevance Health's First Quarter 2024 Earning Call. Vice Investor Tanal, Steve is President Relations. of This Morgan on call Mark Health are with of our us our Boudreaux, Benefits earnings Health morning this Carelon; President Norwood, Haytaian, CEO; And business; Gail and our President the President Benefits and business. Pete President Felicia Kendrick, of CFO; of Commercial Kaye, Government and the initiatives Gail recent progress quarter, discussion of and updated will our the begin the call with year. outlook for our a strategic brief against results and financial in Mark greater will our then outlook detail. discuss After remarks, Q&A. team be will our the prepared available for

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

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

turn I over will the to now Gail. call

adjusted a These today's of morning, strategic dynamic earnings We growth good our and and disciplined that Steve, you, per during Thank I'm reflecting appreciate earnings you share reflect our $XX.XX, XX.X%. pleased Health first diluted time everyone. share industry. execution quarter $X.XX per initiatives of joining delivered call. of Elevance report to results of for GAAP earnings

to earnings for have we $XX.XX. increased per solid guidance the Given year, than the share $X.XX by greater to adjusted be start our

invest significant and our and to accelerate making Health XXXX Benefits services, in enterprise are strategy high-growth on our optimize opportunities capabilities business. progress in We

confident in advance care, with in experience incentives, the delivers providers step are to and After aligns and local that the patient-centered to right access consumer high-quality support we approach, health journey affordability. greater announced value-based tools, value-based care and we of experience local better working Monday, improve information which On patient closely expand decision our to care market. real-time outcomes, our our next years hyper clinical provider

a an Rice Dubilier Clayton, into provider to Carelon the advanced of agreement health build payer-agnostic entered together with business, our will million across and to and the primary Upon physician membership. form own medical plans, delivery we venture commercial, with including enablement strategic Medicaid entities, a partnership assets and of X Accordingly, consistent care of care & company formation, serving consumers diversity Medicare The enablement the will bring nearly new combined certain strength innovative serve X consumers. Health. care

ACA, for what time, our ownership consumers Medicare plans, the for In trusted role health with advancing and Elevance and delivery delivered. as range management lifetime experiences strategy Health The provision broad Medicaid care for scale health advance are provider accelerate development capabilities health partners have collaborative Medicare, to members worked of by privileged employers. commercial health Importantly, we a platform our the personalize of business our enablement and across enhance our and companies and physician a care and value-based and care they a of are excited value-based We're consumers. consumers full deliver for to confident and will integrate the to enterprise value Medicaid and the teams improve at accelerating be Carelon group, leading outcomes innovation, care of the care closely members in for with these our businesses expect and more will providing collaborate plan health will to commercial have we their broadly, serve. CD&R with we partner

we where progress infusion services. on tangible in of Healthcare, growth. Carelon, In our provider for CarelonRx leading made closed flywheel first quarter, Paragon acquisition scale the a its strategic notably of continue we to our enterprise initiatives,

forward to come. reach Health coverage geographic Elevance looking expanding consumers years We are and to its therapeutic to for more members serve and

our complex CarelonRx whole health notably the those furthers the own our enterprise specialty of are to of commitment we with chronic conditions, needs members, our build-out address As accelerating pharmacy. and

Services For our country. example, up Pharmacy Carelon Carelon growth entered to to a acquisition implemented existing testament and drugs. sixth value agreement we start business, The we distribution pharmacy the in largest strong pharmacy the limited year were contracts, to access Services into acquire the and businesses, awarded also of bolster as recently a this an to CarelonRx' infusion Kroger Specialty specialty provides. will new while increasing the is multiple

Health instance, by services of to selected management Medicaid provide than members X.X in the was XXXX. to For Carelon behavioral health Behavioral more starting Department Maryland million Health

step and in demonstrates mental health to forward for need of health And to our clients behavioral in in value customers services critical Momentum consumer this expand and California, the partner experiences better the school with underscores building major management a addressing team is external affordability. our and and health health year. represents settings educational Carelon well-being plan improving students improved our public to system This is the initiative commitment Services with the will communities. support for creating later for

era is Commercial in from membership momentum pandemic enjoying similarly Benefits lows, plans margin notably we business our a large off start. among are to continues employers. and solid ACA individual self-insured to and growth, recover Our Health in

estimate These business, for eligibility and In Carelon in in the business illness demonstrating We expectations. their care quarter, offering pleased performed distinct in serious traditional those first our mental Health beneficiaries line serve populations nearly including statewide, and with business were Virginia their redetermined. our Florida and by Elevance foster years members after confidence offerings Existing Services of our clients XX% opportunities to that are Medicaid be delivers. value our across with consolidating complex ] source Florida, of with us [ those sole solutions selected our in had their have underscore pull-through side-by-side Virginia. in their our Medicaid the we awards with In our and to of competitors.

work tirelessly our are to We're that options for subject the than who have more we operational helping million beneficiaries team Holistically, their to upticks recognize in reenroll, the of to Medicaid the logistical understand a coverage Medicaid done their we approach. recent our continues members eligibility Further, anticipate challenges. access months. to face gradual of redetermination, have we and in Medicaid care beneficiaries contacting in in of members administrative as for increase lost in omnichannel them maximize to proud Nonetheless, returned. to Medicaid a ongoing work more have X.X yet reenrollment not need observed continued majority and rates reasons rejoiner seeing trends aligned with through have

Turning were month X-star which members of up increased the last pleased contracts contracts, We percentage nearly updated to to CMS the Star in or that our Medicare. of scores our X XX%, to announce higher-rated XX%. for from

this be bonus quality will Funding our have challenging the will to a ratings entire for While in is industry. XXXX Star journey. for will our multiyear Medicare which all our at be quality revenue our improve in local high Star goal plans of markets, XXXX, the in end

for income has consecutive the well-being. notably, which for CMS the that their who the to impact program health seniors, negatively year, Advantage will spectrum of decided second at rely disappointed lower are cut on those and the We Medicare rates end

across exceptional whole seniors deliver committed to while also through in margin are through examples While Health the of their continue by Medicare value-based we care. I'd strides seeking value health offerings underscores like We quality and seniors. to Together value that which the care. that consumers health our our the needs, ecosystem. remain to on highlight we've particular health growth unique discipline plan care success, delivering to continuing the Advantage we we privileged Across we on bids, enterprise, the created XXXX unique to balance our approach our steadfast. serving focus making achievement focus innovative to serve and showcases are recently remains demonstrate The Report, will released our care a for to Advancing in with for that partnerships facilitated improving underscores Progress report providers

NCQA partnerships strategies reducing improving care while and in specialty including and quality Elevance costs, obstetric for birthweight low impact clinical birth with interventions enablement preterm and and timely outcomes all these has consistent value-based by specifically value, was The prenatal its follow-up. accelerators improvements our postpartum by led in provider health innovation leading-edge quality rates program. health honored Recently, improve of the Health and by for that XX%, XX% award to featuring access babies care to

learning Health interested transformative in about of you Together to more examples progress, encourage For other our initiatives and these visit our Advancing I website. those

Fortune purpose of their It's Best in the world's XXX list. to to efforts to to Companies also want I named see our associates list Work row. be most Magazine's of XXX,XXX included who our to heartening gratitude humanity to in my tireless In deep closing, the companies innovative year companies externally. embody were recognized admired health for America's fourth their We extend commitment. We a were also most their and honored through improving For

to With that, on results I'd like our provide to and Mark? over operating CFO, call more outlook. Mark our the Kaye, to turn

Thank you, Gail.

by business. quarter XX.X operating heard dynamic reflecting ongoing our in reflect Medicaid solid million We with results you first ended members, performance commercial earlier, offset a March partially As our environment. under attrition momentum

to establish and a exits by added long over declined from and Medicaid. as strong selling quarter, and given and the membership market given attractive nearly the Advantage During Medicare commercial positioning retention product over actions term. for a season to transitions driven our continue expected, successful individual strong take away select fee-based collective sustainable and account members, the growth XXX,XXX foundation we we ACA slightly, members national XXX,XXX coverage profitable

the Operating of to expense revenue due our ratio of premium year-over-year from commercial of XX.X%, The quarter with cost benefit ratio was adjusted of prioritization. lows. rate improved $XX.X XX billion, expense to disciplined expense reflect with recovery medical management ongoing basis commitment and the investment in for first line consolidated adjustments indicative pandemic quarter The disciplined the consistent to trends operating points expectations. XXXX, era margins our XX.X% and was

and performance operating of adjusted led in in gains gains Benefits growth for growth and consolidated operating of Carelon and X%. segments Health our Solid to million over million, $XX both respectively, $XXX

quarter, with driven X.Xx respect We cash effective flexibility. further underscoring by operating growth expansions our allocation the our stock Carelon or service With growth. repurchased ended ratio in year, the Carelon Operating accelerating net for Services with $X value shares balance common to Behavioral of flywheel management, quarter $XXX risk-based line and line and businesses, debt-to-capital revenue first the a Carelon income. our million ongoing in XX.X%, our was the X.X approximately target or and Insights the had strong cost billion of of in especially Health our and enterprise particularly flow capital in proposition. intrinsic the start confidence earnings with long-term to preserving we million a the sheet, approximately range during shares value quarter

at consistent to an up XX, maintained March of reserves We disruption industry-wide was and that with reserving. impacted prudent increase X days a clearinghouse. quarter. driven prior claims approach associated Days claims slower major XX year our claims by This days as in largely the higher due payable to stood from receipts

moment Dubilier As with additional days in take our be long on partnership color Clayton, low payable a to term. provide a also & reminder, to XXs like Rice. I'd expect our we in claims strategic range the to

best-in-class scale to to payer-agnostic coverage. excited their platform are CD&R needs We regardless with what advanced of of a consumers care unique enablement will catering delivery of form partner the be and to

path consumers majority apree on Elevance This Carelon minority in employers are will to in approximately unique delivery of privileged to regulatory based the the ownership the delivery to collaboration assets subject full and of to hold then local the of significant will a approach the first The includes position serve. in Physician a well in and care X health capital and we business clear and with our strategic At communities, our of onset, conveyance customary allow the as the Health needs from advance and combined is oriented care us cash our interest Health years. form Group of Millennium enablement certain formation CD&R as and contribution partnership equity our to approvals.

in And year, to delivering Overall, and our XX%. we enterprise growth our per momentum underscores solid with of a confidence our are share our performance quarter businesses. in and Carelon least resilience and Benefits annual the diluted pleased start adjusted compound balance of of growth year Health earnings in the rate first consistent with at long-term another our

successfully on business. services, the focus will to XXXX, forward accelerate in look rest benefits high-growth we and our and our our health opportunities strategy executing capabilities optimize remain we As of as invest

And with for questions. operator, the call please that, open

go For of line first question, from our we'll Instructions] Lance [Operator Bernstein. the to Wilkes

care term, if able base And can you of a the in of far be names, then kind ask ownership which Let you see of you particular to and effectively? color this? practice focused you leverage me most picture little bit Elevance which really a be going about and to do scope penetrate strategy Or Could execution, bit is of of going more the important? -- contributed. forward. the Carelon a leadership, this the as value-based on step are maybe as the little enablement? Is a membership to markets, be about kind that's vision going this talk bit And near in assets little big being areas see to obviously across do

so for Well, great. Lance. question, Thanks the much

my First, consistent, this in absolutely to with closely the adoption care consumers, very much our it greater our we're specialty enablement partnership on strategy see journey care risk and providers about it excited comments, as and as CD&R value-based advancing as is I about with next partnering in well. to we because opening more specifically very bring shared driving step

our step providers first work risk again you a arrangements. much in very more our strategy aligns closely And our value-based said markets. in our to very your it's broad our this directly in downside goal And and remains So care there. sharing to with with focus increase local partnership as question,

what a unique care enabling business. take of this all value-based is step approach back, makes lines to we're think, that I across

Medicare from as shared, to focused going serve across going payer it's get-go, to be going I upon the combined million that's to enabling advanced So plans health the and And it's commercial, X Medicaid be is nearly care company agnostic, and our on locally. primary formation. and consumers,

think that support those patients is that for I is opportunity accelerate through pull it the important Another patients. thing and to provides enablement complex chronic and Services to Carelon specialty

have on We about feel of goal a gets very serve whole a assets and driving to time, differentiated these to back partner. lifetime trusted consumer the experience. been goals health teams again and and needs with health, working consumers our management fundamentally these focusing some for alignment of greater as affordability The confident the

personalized purpose-built patients? digital services. We're teams. They're again, to A very what makes few distinctive, primary The different model things navigation, to too, including high-risk partnership, have to expanded clinics and it specialized assets model. is care about access and, digitally the going integrated enabled for community be and looking clinics, be practices, at going built to care

So say that fairly last comprehensive in to And market not these approach. thing access of a have historically lot the can it's is see a capabilities. employers I'd you had

health clinical that this work we capacity that their And already with strategies seen have navigation care doing the through differentiating. specific integrates dedicated that the we're primary truly and benefits is and wellness

the commercial, not of a business. across being aspects single So to Medicare, purpose is just of all work again, this built Medicare,

to an and and space innovation this in care outcomes improve consumer much health very as excited. experiences. We accelerate opportunity So see the

much for very thanks the So question.

to UBS. go we'll from A.J. line Next, the of Rice

terms comments and of I about little IBNR a little good on you the in because got on as of be address the actually higher got sort provision seeing but to out results. a normally like a that? versus when appreciate the a maybe sense of claims feel buildup little there? a claims and bit maybe days to Mark's can Do of for you on you your allowing IBNR the of out that payable, impact a in that you normal level significantly anything first bit the on your trends you're Change see flush just break the and you on of cyberattack still cost Change you've in may handle more And needing for out to unknowns what what have Change percentage quarter bit Do you're if cyberattack. the you've

the Thanks for A.J. question,

broad-based to Mark it provide provide questions. then specificity and Let your a some on I'll me turn little comments over maybe more to

I'm our proud first, their our members on and and maintain flow. cash also data care Change and first I foremost, really with of want responded and their that providers our and quickly teams help this how they to effectively, occurred issue protect to say, operations to

from important perspective, Importantly, are note impacted terms I think normal we significantly claims operations and we that it's flow. a to not were as by back this, to in of

pharmacy Change. to important for provider thing don't go use don't were authorization, prior another Change claims payments is not impacted understand materially that's those. through Importantly, significantly and as because really We well our they

provide it support quite a we that ability help it our over But turn Mark more our the think to of I I'll feel proud that, little quickly framing acted ecosystem to really overall, with them. teams to to in So comments. work and

Gail, As connections Healthcare to and providers. and our both you network responsibly acted just members to from quite data we heard sever our protect to of the Change

While outstanding from XX% all in to electronic led and volumes. are extensive the for and on working related. a quarter, have receipts daily our in processing significant of activities. claim are providers, adjudication we And we XX% claims weeks, reduction catch-up claims up data effectively claims the caught a receipts necessary complete most of recent volume to now are initially observed to which efforts In

payable we've then and approximately As your for increase days Change reported reserves financials to both such, claims impact historical part reflected of days. consistency question, to Healthcare the the sequential disruption it's specific the practice ensures in by prudence. X.X to with and our And result that quarterly was here of appropriate first we the practices, normal in the our reserving industry-wide related impact quarter

Nephron to Next, we'll Raskin the Josh go line from Research. of

partnership I alternatives this coming think stressing heard you I've and and you focus past, did it what to were well to care. specifically, the in to get And with that arrangement? as wanted on the evaluate back specialty consider today I before more, CD&R.

in of of how could not top on that you it was and just So how your this? bolted longer-term important approach? memberships national And get that fit multiple Advantage. into maybe then does fit And serve sort does this where Medicare

Yes. it to goal, strategy our mix foremost, guess, really much our that is the and important. I Thanks all business first was agnostic, We've it and all members that Josh, for very we've payer aligns lines. think out. of question, diversity the said laid the because serve it's always given I business to across

and very important. local in many the a had with of is We our already assets. markets, Given these density our that of membership depth partnership working

So as the I we know We leadership the can be said, know -- we know the membership created. value teams. that

we on very advanced enablement, patients we specialty very have been much about again, primary with important. still focus care, are agnostic, of it's chronic a trying will is so probe to on we good continue focused this through and building again, complex us And feel another very This what having important quite also working our create. we're them patients. help care can think which is is, we component payer and And which And through. still what

across think a their drive consistent, help lines means of model. from business, that work technology-driven of strategy, through It risk, value-based it that way all much I care, strong downside So to continuing needed also know We care to very a that. enablement practices time. is that takes more capabilities we our critical value-based which driving part

And care in there about as that adoption models. well. the of next-generation we is access So technology this on then have patient embedded things to experience of a focus and digitally nice assets the one are enable partnership

last the models timing years, we lot the think, had diversion, the experimenting and because And multiple us right several that with a think right of that. consistent was again, in for really we've I a experience now. So space from have have not been with over the strategy I

Markets. to Capital we'll Ben the go line Hendrix Next, of from RBC

we to over platforms see get wanted Just these expect get we on to to that develop another currently? taking the horizon partnership. see kind as care time to Is Carelon? period? capitation CD&R question of the if of the To extent kind what can on of more Just something that digital enablement will full ownership, these are primary that need from full we abilities over platforms these X-year risk

Ben. context. probably provide have Thanks, quickly, lot more arrangement of under just X/X I'm But going about risk the is a now. membership Pete to

see Pete, that, why relationship don't give So color how into with evolve. it little more you a and we the

see great. assets more little MPG, great you bit the your of When the really frankly, quite a in and about Ben. cross-pollinate. you And strong very are they've to think risk. have they commercial Medicare managing capabilities. the give terms proven for that That's color I'll I all distinct And the Thanks risk, a really and question, They provider We also a to opportunities, future on in chassis, in practices. leader question on think, model regard got for and growth a acquiring strengths.

at strong referenced and of navigation a with is, differentiating technology real this and Gail business. regard. commercial apree, very and strong What's So risk in lot a interesting capabilities really managing capabilities a focus that on about got the they've

nice us. for So a entry really point

apree. for tremendous relationships opportunity We mentioned all I'll and And see create on of ways point for Services and largely that of with us. EMR terms because variety technology I'm a that. company, as growth upgrade working been reiterate this value about X really a advanced MPG around of from nice Carelon for a as we that takes a And partnering to existing today. and risk We've primary a this, One, perspective, really perspective Gail wrap state-of-the-art managing that finally, assets. in which a in from can in then it, the will a to as a obviously, and is a strong arrangement have but we, well opportunity really care, tremendous the complex entry And footprint, commercial Health chronic Carelon course, leader this excited in regard. then, already

appreciate the question. I So

annualized formed comments $X remark, quick debt there, entity And once of the end consolidated then have financial Pete's one to at in do we billion the revenue. just over expect

Dave of to from Windley go line Jefferies. Next, the we'll

Medicaid. I'll switch to over topics

pick impact quarter. in the redetermination some to up momentum maybe seem Your enrollment

I if gate kind I update you expect is several members you have how redetermined. now said whittling on down? could risk rate next then us of now give XX% the the how some think from you looks could over pool a adequacy been And that of view out of you membership quarters? wondered that that and standpoint, to

to your Felicia questions. address Norwood going have I'm

Thank question. much you at now, our the tracking our Frankly, right with for point is we're a where business very in line actually Medicaid expectations.

redetermined. you believe XX% referenced, we As their eligibility had about members that have our of

few So we as you through June. as get the go wrap we we really through months, next certainly see up this as tapering down unwinding process the

One understand, sure of downward redeterminations, but things the the to quarter as in just footprint trend I from not make changes want you in the resulted first well. membership

those cumulative we the So terms first will quarter. When we to in the will continue to Medicaid of work things the really outreach to continue that we it's about think is impact do of two members.

have who that reasons. of as really result members a point, procedural lost did this Many their at membership

referenced make opening Medicaid who for the are Medicaid transition product to that's million of that comments, people, very if not, outreach proud and coverage. that be going truly able continuing continue to we to and reach as to have are around do to really been work the continue will an exchange to X.X team Gail individuals we're over on, aggressive the the eligible access So in to and out really to continue sure

membership, that In line are we mix the we with where and the of is respect in today acuity terms expected. with what of to acuity

XXXX. XX% our have this into expectations that are Medicaid of will and actuarially I with at premiums sound. are vast point, majority say we The visibility and also our rates of those line for in And

as sound. As continue conversations expect partners actuarially rates to we process this go state you and be know, our with ongoing have throughout we we to those

payers we to to the and terms this continue go with versus our have leverage through to going going lot go members and making we're process the of with they we're a work to coverage, continue the going this as care state We're sure sure partners. mix ] understand rigor, [ with access So our our make efficacy to membership of that we and process. discipline through and of in

line of the Gill to go from we'll JPMorgan. Next, Lisa

could of the I maybe by you trends what quarter about utilization expectation. saw versus was you in wondering line if than talk business your

Lisa, very for the much thanks question.

expectations the our and and So business, XX.X%. outpatient In were health utilization of in was authorization line levels expense inpatient as our and expected, year-to-go for pockets rule outpatient saw trend inpatient for example, businesses in utilization Medicare, authorizations remains our On the that ratio X in and related as with radiology internal in benefits reported expectation, aligned around, unchanged. we year-to-date the benefit commercial was both procedures. cardiovascular stays as of quarter midnight our our first to specifically with reflected approximately well

mix a with importantly, we're Medicaid, there, the dialogues utilization increased seeing you remain those trends about ago, underlying Felicia of given the impact what constructive broadly very heard as moment were states. comfortable ongoing And our we planned part did assumptions. redetermination talk impacted for these and cost trend as experience but with state-specific attributed to

overall, bids and reflect so both the pricing really appropriate our And MA cost utilization trends. we that commercial for our confident XXXX remain for and projections medical

Kevin go the we'll America. Fischbeck of line Bank Next, from to of

Great.

the on in that sounds believe thought how obviously, It I just relatively huge is health like not was a would guidance, there. it's some something -- thoughts increase to in you Carelon Just of kind the driving love in providing if plan hear it increases is what visibility you It's about guess it but guidance? but And wondering claims, there's side? in on side? increase Is concern guidance. the about high

of conservatism in there's thought what if or seeing you're actually pace versus know don't the about I So any today? raises core business

that time see both by we dynamic highlighting this what the came this quarter in during led and to our continue what as basis specific expense expectation. slightly favorable were better is note, divisions, quarter, and performance lows. disciplined by adjusted increased margins solid was initiatives you question, basis driven which in that And and for and diluted was margin the Carelon that our benefit a industry. by We than benefits EPS respectively, operating health first to our ratio era points where Of execution pleased XX report from pandemic performance of our the points, seasonal XX commercial referenced recover in your in

by year. results. intentionally and our pleased outlook our to that trend, than to us led very early $XX.XX. prudent for adjusted our the increase with and in subject It's guide given to We're greater remaining And cost around be still the QX some medical thoughtful EPS in business variability is we're $X.XX

go we'll line from Mayo Next, Whit the to Partners. Leerink of

segment? I Services. did, Did external wanted the Just comments external that to on think, revenue with Carelon growth grow referenced some the You growth. any than overall strong hear faster

So might question the be in Mark, year? a you've XX% that And on the reason curious what earnings then just half. different of averaged in traction gaining market. XX% first this be would to maybe guidance. quick Any

Why I questions, Pete? of Pete Carelon Mark talk earnings the sort don't will then the and have about Great. address percentages.

question. for thanks Yes, the

with really wins Medicaid health. across She wins, some for new California. wins which As momentum we're really of employers all overall state behavioral it some what about. at the And relates new Maryland, really see did to XXXX. nice perspective, to with statewide an we're several Carelon mentioned mentioned excited we we've exceeded you our solutions excited in And prepared I sales winning in year, in as external as the a about, in which then remarks, heard growth, XXXX, from account build. innovative mean really Gail continue for we time of in the portfolio growth already notable well her in this large

select on in the also health some space. the crisis wins behavioral And side,

on. we've been So really areas that focused

differentiated in wins several addition it's we Blues play to Elevance our and arrangements about we've through our with that prove but that and of those Insights we've this really our Blues, risk to We've In some the business. port wins. the talked related and that notable seen then capabilities critical notable some had to before, with

Lastly, I'd actively pipeline. excited the say the we're 'XX about season. We're selling obviously in

Our pipeline our large as businesses. rich. say would insights behavioral health again, is our well very a as I businesses focus on And

normal that earnings to to adjusted of also seasonality, EPS several be XXXX On work the with work a second more the quarter days But than to the an XX% in smaller question, with of offsetting consistent with result slightly days than quarter expect put in I out want of the as diluted those in years quarter. your leap on seasonality favorability expected normalize. it the year first the fourth year. MLR given we impact the approximately seasonality past in historically work half did third first call days the pressure in the is a is

Thanks, just to want about Mark, Carelon. momentum add inside seeing just that Pete's we're of Whit. comments I the for the and thanks And question, to

are and points now then First, seeing externally. Health. some momentum our really proof Elevance And secondarily, nice traction within

line of Goldman the from Next, we'll Rich Sachs. Nathan to go

that I you tougher I the and think does that highlighted. up expect environment Gail, given comments And and to the just goal Medicare Great. Could this improvement kind follow Medicare your remain the XXXX? of that on of maybe you in do on on on year, rate has And the for further elaborate track wanted in company margin 'XX? improvement business prioritized you margins. to balancing for growth plan

Nathan. question, the for Thanks

Medicare result and heard, needed program, my in you've program. that shared in rate to and first will the of of cuts I disabilities opening premiums reduced year As all, the consecutive this we for have know second increased that with really seniors benefits represents announcement, those as particularly comments,

to We're to in consistent. Medicare very is approach approach Our continue disciplined the our be business. to going

focused Our this business. long-term the competitive early sustainable, get focus margin. is balanced a XXXX stage. high-value for and attractive and on We're It's provide specifics to building benefits to too bid consistency at growth

Blue And in our talked we're and to there, our looking again, focus we're our really Day, on growth we is as margins. about keeping I'm to members for And But going life. repeat, balance Investor states focused complex where unique is needs consumers GSNP very [ of competitive have serving advantage the our in ] Blue those we and the our particularly XX to with conditions. prioritize significant continuing on business

we're overall, the in process So right the midst now. of

So very but question. we'll for you the process, bid have more we get much through the as thank

of Stephen Next, from to we'll go Baxter Fargo. the Wells line

and remarks. seems growth the your Just at prepared Like obviously, like XX% long-term in about talking past, the interested, you've about XX% target. expectations it now slides least you're talked CAGR in EPS XX% to CAGR a EPS as both the

what, anything, that. into wondering be we should if reading Just

Thank you for very much the question.

through earnings long Carelon over at the in our XX%. foundation term, cycles business last a confidence these and sustain XXXX, XX% communicated achieving through we And XX% flywheel that's adjusted we year. momentum synergistic. of per time, see firmly earnings the health to then X of rate share should the we targets a remain that of as event at broadly to Day long-term as to have power around and as generate the least annual CAGR more benefits will Investor our needed We committed long-term growth You compound think

line go Barclays. we'll to Mok Andrew Next, from of the

an that, your the specialty us Hoping of have BioPlus on year. us can this and you contribution to scripts update give expected understand to that's help transition

your Let me to address Pete have question.

Yes. the question, well. integration the Thanks Listen, is for going of Andrew. BioPlus

an on building regarding spent this. we stage we're And team, did so begin year we the January year. and migrating out and I'll last remain just on this scripts we accelerated in the a know, you basis. really infrastructure As doing reiterate, calendar of

to as we'll continue Elevance throughout migration the it 'XX the to of So business. and do XXXX relates book into Health

well I'd are live infrastructure BioPlus build say going we live are X in more we facility We're as addition place. to things The additional year. X going facilities speak, this that have well. and with overall, is now in dispensing going the

respect Elevance So to about feel not very capacity, business only the we with that. Health beyond good the

And 'XX throughout So it we're will staged we're excited path. a 'XX. on and again, be

Yes.

just what BioPlus. In addition, to I'll add said Pete to

to effort And we As matter. well that aligned acquisition that is of announced Kroger also Carelon's also you Pharmacy. control know, the levers those to Specialty

the for So you Nick, thank question.

from we'll Deutsche Hill Bank. to line the Next, go George of

the just specialty, you comment a from you rate versus the you in, to like to changes talk over are think kind you of transfer wonder add are about about and stickiness on far that the in repricings trying rate if where get BioPlus the mix could to we follow to can I I'm determinations in I'd of and given guess guess, of acuity on the redeterminations. in you think expect First, scripts the just the Dave's kind where if how of kind scripts? those the sense versus those about and you talked mix up I of I you -- Medicaid. mix on for I calendar do acuity how question And behind And think guess, a Kroger deal and

question, which quite is, this I Yes, pretty at think point. things aligned George, are think Felicia we covered much your

the our had So of mix, the with premiums. and in we have terms everything, our acuity states. constructive visibility very into We've of XX% Medicaid discussions

are up. overall, and conversations feel So our things sound, we are They're lining ongoing. actuarially

point just of sort a good feel that. business, our I very finer put to So about on Medicaid

I'm ask comment Kroger Kroger, going pharmacy to of with going our terms on to Pete align business. to that's how In and broader

of a to of we're is quality. very to provide LDDs, for in deal. thanks George, BioPlus. what both give it just our the quite you this in strategy. question which be enabling distribution to It important. And sense Kroger Carelon Certainly helpful us. complement this excited Puerto drugs, specialty It and to largest affordability pharmacy really XXX,XXX the a Pharmacy more Rico, and background, the MMM Yes, on we're meaningful Paragon, for and a increases recent pharmacy. presence what To us relationship extension could it fact, natural our it, manufacturers, you to is furthers arrangement strengthens with Gail about add with a nice to as going Kroger. non-payer the natural It owned doing to And greater frankly. limited which give very And has business. is really do a And some year. scale. alluded going our They access scripts BioPlus our do Specialty is to about It's is with certainly

very choice. in will about straightforward. case, and your feel feel we the we very transition we execution about specialty very scripts, good believe providers that. and question of it good pharmacy have As We the integration the with I But about stickiness of mean, to the relates transition the model. feel good on obviously, this and scripts, members be

arrangement the to year. likely QX-QX close expect We this in of

Scott Next, we'll the to line Stephens. Fidel of from go

could with than bit XX in out quite year and double-click down margins points. call stronger Services a Just Carelon there seem interesting Anything where if the that of of would called basis pacing points expansion. to we basis the the you you be sort specifically does full on for first to XX that had the guidance then flattish quarter

you whether Services on full expect updates trend curious have you So for for how the just Carelon year? margins to us any

result goes growth to time, the we're the to of first which me of at some transitory the doing. for expand about deals, we evolve, this couple internal new risk in a quarter, the year much the given We're guidance given expect the our very to what expected well talk continues not question. in over quarter you seasonality in business seeking our Pete revenue update quarterly of on. anticipated let that of for aligned risk-based timing Thank Margins product and very new both several turn and launches the accelerate it were the to that revenue as is to minutes volatility. year than full to strong launch But to a better we as very

it. Mark's it covered about it's this appreciated. No, really But think way. And Yes.

this as a should you but significant And risk with impact some and risk arrangement about in a full oncology, We've think year seriously this a this mentally risk throughout arrangement year. the We to launching that's talked it, margin. arrangements the launching ill. to pretty cadence are the what's about natural full going

with states all bang 'XX. in ill, So Medicaid the not doing It's you'd big mentally for expect. state largely we're the with and methodical 'XX business. It's Medicaid immediately, example, by as seriously this state a the more across

Next, Lake Wolfe Research. we'll Justin from of go line to the

for what the mean view as D coming significant are that space curious could was your for XXXX. on There premiums. Part I some changes to in

where us how significant tell year could premiums kind increase think for you are you this that of XXXX? industry and maybe be Just could

that. to I'm ask address Felicia to going

I'll this, as Gail our to sure margins members on are question. sure say dynamic in you specifics to to competitive believe serve we our that the going a members going very changes we work needs we those There is have we market value Medicare our to focus think thank things XXXX it's around approach of those as the environment provide significant And to the Medicare product strategy early really before, to for Justin, for and mentioned meets for highest So a we with bring balanced the are have a make as around But we that that coming be. lot XXXX. about in are trying the changes business that going we're that make of XXXX. what on

you thank the question. So for

Next, of we'll line Ann the to from Mizuho. go Hynes

but is growth. looks and market like contract, big the it of risk you? actually years, RFP let the for any is renewal opportunities for also Congrats on And membership the there gaining know you big looking any alternatively, Elevance, retaining couple Can you're there us over Florida share. state ahead next

with It's been very and are much in But particularly state the with kind that to We very expand complex the our collaboration certainly some here be time. results certainly, a partnering our Carelon in footprint win Florida. pleased period we a a additionally allows of populations, SMI, of for have serve long which Services business. us will

that. about excited very So

focused in very as is up Go-live, Virginia also which are We July coming on our well.

partnership to Outstanding our where as good as in Georgia a lot feel with core we So will State the to well about and foster certainly procurement our work be there continue defending our with business of in the the of at business this there. state. Georgia, very point care is that work happening respect do we

geographies go we addition, business much top we look this new where on a for as we a states and Medicaid very results. are focused couple are hearing and of of forward as important the are opportunity we those that the to us. specialty very focused year very growth bidding is But on for on In populations, forward. see much that,

wins, are bring improvement that we more we the that state our outcomes to Medicaid in But quality recent think, RFP partners. demonstrate providing beneficiaries. and value Our importantly, to the I

you for very the much thank So question.

we'll Next, TD Taylor line the Gary to go of Cowen. from

to very obvious but wanted I for the are changes. to you're me. this you're second. a rate but for mean, year, saying Medicaid I come the quick Two margins book getting acuity doing down actuarially Medicaid just sound for back had to is ones expected come well, your commercial adjustments it's you

that Medicaid of payable deleveraging, question made the about claims comment. this think lower XXs. impact we the low MLR John into days would was, how stable? years come the Mark revenue just So be is about fairly for just should to margins and losing the second the And this enrollment eventually comment this OpEx and my going then down year, made primarily

seeing at That's means over any sense come the a lot long-term earnings could point of inherent in or of of time. the Can through what some you embedded move P&L power that give of us terms lower? sort reserves

the Let segment me to talk it start maybe bring benefits let margins, about to up with health business and the first. me

line already approximately So a much XX you but for to our soundness in terms we the of XXXX sight, Not It very given could to that seeing. on we health benefits, talk expectations. expect of and into XX achieve between heard the in with are looking of and have points. comfortable are the Medicaid the to for this, track the Medicaid with premiums actuarial rates we basis margins line us margins that margin, Felicia our XX% about normalize on comment and of this you businesses guidance puts quarter necessarily year an squarely single were full of increase

in look expected the to X.X Over we spoke decline term, million the X.X we to a upper is that as normalized more quarter, continues to of And out the commercial, over to DCP term slightly long through last within long performing XXXX, the over lower low the in expect XXs. compared the as know, range then time reiterate DCPs example. for million range And guidance, you to do to Medicaid guidance members. relative to return has membership range On we to we year, normalize, Medicaid Medicaid is remaining if about as the expected. XXs DCP it for given of and to anticipate end mid- our

question, please. more One

And Sarah for our line of final the question, to James Cantor we'll from Fitzgerald. go

seems conservatism a fully X.X are to a via boost One, things. reserve clarify because you couple is $XXX days to on wanted the change that like that about us. saying to reserve related Just boost, of

your that days. second, renews your of XQ And give was XQ? if So what us sense seasonality? there versus any to Medicaid in book XQ wanted see percent I you other of Like could factors a X.X in versus rate

-- benefit increase It's On had receipts we amount result a on related during question, or clarification believe any otherwise want payable Healthcare. days around saw no the the discernible took or first Change the noting and would represents to expense there we that's reserve disruption. one primarily to the in that ratio related maybe you I P&L your in sequential quarter decrease an Healthcare paid the this. claims days neither that quarter our because been had to the worth have claims X.X accrual that we of just Change impact is in reserve

expectations. this should the for are as you consistent think our So incurred overall with about claims quarter, completely

Given full also the to came the our that some reiterate we be like this at least notes just that out year, cash operating $X.X I for flow to reiterating morning, do of expect billion earlier guidance.

September Medicaid Sarah, respect when in renewal, and X another state up another states in and the renew And on rates in XX that year April, And just last with have your states back for in October. January, the we July. are that then question X renew in of renew our that half the our renews to roughly

thank questions. Well, very much for you your

about the start confident, for heard our in with and look coming our to forward great week. your of for balance we're year, year. to interest and in rest have the execution set strategy you positions future Just Health, ongoing pleased you beyond. diverse off as our in and XXXX in a We're this Thank We're the some of and solid well closing and thoughts. progress very the excited more you your to of a us on and sharing resilience very businesses Elevance of be

recording replay conference May available this will XXXX. through XX, after XX:XX gentlemen, today a.m. a and be for Ladies of

You participants participation you replay our This your XXX-XXXX. may by for conference at and system can (XXX) the (XXX) XXX-XXXX. conferencing. access dial Verizon dialing for using time concludes any Thank International today. for

now may You disconnect.