Molina Healthcare (MOH) 25 Apr 242024 Q1 Earnings call transcript

Hello, and welcome to the Molina Healthcare First Quarter 2024 Earnings Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to your host today, Jeffrey Geyer. Please go ahead.

Good morning, and welcome to Molina Healthcare's First Quarter 2024 Earnings Call.

Molina's Keim. CEO, are our Zubretsky; today Mark CFO, me President Joe and and Joining release our is press the Investor A announcing website. market distributed earnings Relations closed after was yesterday and available our first on quarter XXXX a Shortly available will for this be replay after days. of the conclusion call, XX earnings numbers The the access replay the to in are release.

and For presentation, are that XXXX, you the remarks not we made April you of have all call. listen Thursday, the to subsequent initial who of updated remind those rebroadcast this today, as to of been earnings of XX, the

On measures. quarter can first this the be these call, most we reconciliation with the in XXXX will refer earnings to certain measures measures found A release. non-GAAP directly GAAP comparable of

including, Medicaid limited XXXX in long-term embedded growth, activity, During and regarding our growth our statements redeterminations, our performance but M&A our not our Medicare and the will recent forward-looking call, we related guidance, to, our business strategy, XXXX. RFP be future and recent awards making and revenue earnings realization power acquisitions statements, earnings certain

review expectations. we Joe to our remarks, discussed and that with call advise are annual filings the differ statements with certain questions. the Chief Joe? X-K prepared to materially Form subject results the that our our our your will open our as filed our XX-Q and to now the in of factors in turn Executive risk completion uncertainties After from our current Form well Officer, Listeners I the Form over take of our are listed SEC. risks could to to Zubretsky. call will factors, forward-looking listeners cause all the report cautioned risk actual We XX-K SEC as

the our first guidance, of update which highlighted morning. mixed, revenue and Today, maintaining $X.XX an Jeff, traditional $X by expectations, at earnings we we growth the reported in were earnings our quarter and and cover per our which premium billion you, financial An on $XX per in were quarter, earnings least our per line Thank our results share for of quarterly with growth will in reaffirm outlook. long-term I and are topics, good share. our but embedded on which update of at estimate $XX.XX share our initiatives,

with supported quarter $X.XX, Last adjusted by all Let me start premium performance. of of we business. earnings revenue, lines metrics reported operating first $X.X our night, excellent share billion a of per across

XX.X% or X.X% cost strong our in Our reporting MCR target middle X.X% all our margin MCRs, long-term is management with consolidated X in range. tax, adjusted medical line pretax a after a of the strong produced We reflects segments that very continued with expectations. result

we In margins produced while business to XX.X%. continue Medicaid, first of strong the our MCR franchise quarter a operating growing deliver as

Medicaid together, members we health redetermination the new drove increase expanded plan, XX% quarterly and in Nebraska have impact. and Our additions in California in our with over above approximately of platform expectations. MCR million our long-term with our but experienced along line target late new an our the range, XXXX, store We now X.X believe added in

of states shortfall. most The shift security and our offset as risk Rate to of on adjustments acuity-related XX unfolded capturing stabilized XXXX. with with both providing represent acuity rate corridors have markets. that largely the over and actuarially shift revenue, in any changes, within off-cycle appears rates cycle we predicted temporary remain sound our Medicaid XX%

Medicare. to Turning

to the of supplemental proven the operational second successful. business XX.X%, in quarter we far adjustments half improvements thus experienced benefit performance reported XXXX. first XXXX higher be line in higher our have to Our MCR continued our our LTSS and costs in into pharmacy to due The expectations. and be with made legacy utilization utilization was But

confidence in plan with newly the provides earnings. to of the experience embedded deliver quarter first our Bright Our turnaround us plans acquired Medicare

Our the low-income strategy was In quarter Medicare acuity, is beneficiaries XX.X% footprint MCR serve working Marketplace, leveraging well. expectations. our with of first our existing to and high Medicaid in line

of and the comprised acuity members our in keen mix renewal us insight XX% membership into renewals silver membership gives Our Strong of product. base. XX% members our

We grow the redetermination a expect special to Medicaid membership opportunity process as year continue the this provides enrollment to period. business great the capture to throughout during

at on the full or year-over-year our XX% adjusted our per to year now guidance XXXX least full results, Turning first consolidated guidance we growth. share our for year. reaffirm Based of earnings quarter $XX.XX

year premium billion or approximately at XX% growth. full revenue $XX Our remains year-over-year unchanged

year While Florida. any we half account full from we earnings maintaining the business, in are seeing of in are our underlying core losses and headwind year second for potential our potential to in Virginia guidance contract strength increased the

and revenue XXXX XXXX for strong profitable and in a EPS beyond. growth foundation guidance Our provides

we're existing our Now other remains RFP quarter. we in on in and at comments our to Florida. caused initiatives. In were the earnings, a $X mixed large change All win combined some had not in and which contracts in awarded states, but awarded these net growth embedded Medicaid, We impacts X a large win success share. Michigan, Virginia reprocurement no Texas per

X part contract RFP begin This the me and our X Texas, announced of us were the defended X these and option award commentary intent to its some outcomes. and the contract to position in CHIP our service in is STAR provide The to market years. all preferred in state We up our our for increases an expected programs. additional In successfully areas awarded a of years expands Michigan to extend regions. and with Let award X share. on September XXXX as footprint last

While reduced market many thus, membership, to expect our retained in of we the the of current share. grow these regions payers XX% award our of and our number regions represent

more RFP, be favorable. this could our decision. that Florida, We outcome shown were the result very disappointed the in RFP challenge exercising are disappointed in but the were history Virginia ultimate with outcome right to We also but with the has there we

on gain continue the We revenue. earnings contracts, lost and and share of to the revenue any market embedded our expanding membership, our will unwinding as refine new estimates clarity we

with respect our growth to with remains Now growth future pipeline initiatives, opportunity. replete

is that over likely and up needs Texas remain next $XX Georgia, deliver RFP of in-flight state billion X going over for financial projected with to opportunities and our RFP soon, statewide RFPs, Regarding of STAR momentum. This new confident remain presence bids now great our and in with years. and in win where North we state a Carolina. includes and contracts the Kansas program Kids opportunity The a strong premium states, RFP bid clinical outcomes align very We partners. near-term the X in ability to have many

our great X for results RFP we continued mixed, and our in are in in strategy and X track reprocurements drive procurements. we XX began growth quarter's business strategy, record since ability were to our us confidence new this gives This X Although for growth.

opportunities. respect With actionable our to many M&A contains acquisition pipeline initiatives,

X X billion the to over past in key our and a We strategy. be totaling have $XX will revenue M&A executed years, continue transactions component of

look into the forward Medicare Next, our comments X for portfolio. as outlook about XXXX, we

First, characteristics MAPD than profile has different our Medicare product mainstream business.

of lesser such drivers setting, legacy our With Our business this do of lineup rate and extent. factors MNP Bright acquired matter, to newly is revenue a as combination a demonstrations but and business. products, bidding D-SNP,

growth. Second, the contribute our to product positioned portfolio well to is

dual-eligible benefits. Medicaid membership. will high MCOs, acuity to and will integration our eligible BMS catalyst closely Our announced align with growth further be penetration which from populations rules income retaining and and dual recently of means a for dual in dual-eligible Medicaid populations, Medicaid attracting footprint benefit Medicare

potential even all the With and per premium the the expected considering our of for or share reductions, XXXX emerge majority earnings. new growth committed we on contracts, is still earnings a contract guidance insight successful on to to $X in outlook With in we provide Mark XXXX. but in maintain our activity delivering at remain share. embedded will reaffirmed, in moment, M&A per our expanded components the losses long-term and earnings growth

pleased on profitable call very long-term performance. In and us track summary, keeps on for XXXX with consistent track the sustaining record top performance, quarter growth that, to producing financial over with That first some line With I for operating we revenue color Mark? will the successful turn targets. our with Mark our combined for financials. additional our are

first everyone. our discuss our sheet, on with earnings. quarter thoughts Joe, embedded on Today, and Beginning balance our first the performance, results. and good morning, guidance Thanks, I'll quarter XXXX details additional

approximately of $X.XX. billion EPS the with in we revenue $XX total reported For and premium adjusted revenue quarter, $X.X of billion

consolidated first and Our MCR quarter reflect medical cost was continued strong XX.X% management.

the our MLRs The was first California in quarter. results, quarter new change added reported health past MCR Recall, store acquisition Medicaid, MCR in late XXXX approximately quarterly early members in and the our store materially well Medicaid as a quarters, members care impact all stages. outage in segments not XXX,XXX experience reported did in My expected, In the Nebraska line higher additions and expectations. Wisconsin these as the as and XX.X% in with and our of higher the have typically we first new Iowa Choice X reported drove MCRs

Across XX.X%, Higher and Medicaid business, offset in operational but of MCR in quarter-to-quarter reported were for within fluctuations XXXX. our our were our and cost the our business first costs by with expectations. in line In major somewhat legacy was pharmacy categories guidance. LTSS line benefit that trend the our quarter improvements largely medical with the adjustments our and implemented we normal expectations continued Medicare, utilization

and our plans expected. newly pleased are we with Marketplace, with silver reported high rates results as XX.X%, Bright Segment now first renewal include acquired and the was composition. quarter membership initial significant MCR performance the In

we quarter expected, reflecting benefit of as leverage and Our the for grow fixed X.X%, was the adjusted cost our business. ratio continued as discipline G&A operating

a our members since to total to from the loss quarter, on and was In net brings the we redeterminations. This net to estimated with XX,XXX track on redeterminations. inception Moving its loss XXX,XXX. Medicaid redetermination of expectations due

our through process. estimate the membership redetermination the of We that approximately way XX% is

another total net the to We quarter XX,XXX XXX,XXX. redeterminations members reach pandemic-related quarter, last our of expect in loss of to the second lose estimated

rate was XX%. reconnect Our

and some XX% to We the into of And the second course, benefit remain expect rate continue quarter in quarter. will reconnect of third the near beyond. this

membership moved Medicaid members see losing to We Molina SEP strong growth continue to as products. Marketplace eligibility marketplace

our balance to Turning sheet.

X.Xx debt-to-cap company the trailing at remains X, and price closed million of bringing we foundation of In million was quarter. of XX%. cash hand. $XXX approximately we a to harvested unchanged Our capital subsidiary January quarter cash about balance on million, at $XXX with end Debt the the at dividends, ratio strong. XX-month of final our acquisition end our with the at Bright approximately EBITDA the funded On $XXX the parent quarter,

position for and payable and high at ratios quarters. earnings These upgraded transparency. our the low leverage investment. both Moody's and consistent and stable In profile with debt, on and our quarter, XX% and S&P our end based capital claims quarter was capacity of credit in low ratings ample reflect cash growth Days the additional the prior

claims with response restored operations lower February our in than March. through impacted clearing normal we're outage alternative XX% Healthcare to Change that near report to payments and quick normal, our the While pleased levels houses claims

been strength Given prudent the confident appropriately are reserve our mid-quarter of position. and in we the have disruption,

Next, XXXX a our few guidance. comments on

$XX our As reaffirm Joe guidance mentioned, revenue full with billion. we premium of year approximately

Our state with understand of revenue work partners any losses and unchanged in as timing Virginia impact Florida. we to contract guidance remains the and

Our all MCR across expectations cost we at is in Medical conservative stage with appropriately are full XX.X%. unchanged this trends the year trends utilization at our year. and remain businesses, outlook consolidated acuity on and in in line

year see in business. share. EPS per We core full least of expect to continue our $XX.XX at strength underlying We

potential guidance of Florida. However, year earnings full we potential losses the of in contract any half second Virginia in and are headwinds recognizing our from the year maintaining

portfolio. rate of Looking Advantage notice CMS has few ahead attention. for received a Medicare on The XXXX, Medicare lot our observations a to final

that received Medicare of California, of important total a revenue yielded For X/X our these Molina, is only a XX% segment revenue it's only rates. concentration in note With fully or subject enterprise heavy to we to cost rate the favorable CMS which our our The profile and CMS be commensurate appropriately of with averages. continue segment, demonstrations remaining rates trends. determined Medicare than to X/X state by partners, more national MMP

off is We start. grow from profile business of our this our expecting our a The Bright Recall position year. us that product will to dilution Medicare the profitably. modest confident and rate to recent environment are great that we Bright remain acquisition integration

in We expect XXXX XXXX. EPS even $X in then an accretion full break run and improvement to rate of

Looking a Medicare perspective. from at different segment our

these Currently, plan believe As to D-SNP that medicated CMS benefits advantaged Medicare earlier, strategically members members grow. Joe move run to CMS their unaligned eligible recent mentioned different MCOs. dual announced X by we us from the role, final Medicaid received dual XXXX rules will MCO. their many that the

players As growth such, opportunities D-SNP. see incumbent Medicaid will in increased

our Medicaid gives This substantial with that rule partners to shift, will targets. Medicare from us to confidence, While time, the our D-SNP eligible these us new over service members. long-term grow phase well our product margin complex growth to our will populations portfolio footprint it's state due demand along in meet and positions clear serve

embedded to earnings. Turning

to guide losses. be store approximately estimate offset contract we continue embedded year to of in We win new $X.XX to from expect year's and now the as by the next next $X potential Texas impact best of our Florida earnings new of Virginia incepting

majority the giving XXXX emerge EPS. us with are to remarks. rate the this ready we earnings prepared XX% in XX% to now to in expect questions. of growth We in XXXX. store new Operator, further our for remainder confidence our long-term This concludes embedded take

question Sternick today's Instructions] [Operator comes JPMorgan. Kyle first from And with

with and line the here, your talked I is sort guess, -- the you in being business the strength expectations. of the first, on I in core MCR about wanted to guidance start

-- think guess, you'd offset to need we the those outperformance I think from Or going target -- us think maintain And losses? in away, be then really if be those to is is about the is you would contracts coming able half enough the back color SG&A Just that to are back So business current about potential to I help the allow strength any in way additional that when to the there frame to right savings to guidance? G&A? the you guess, half great. is the

Okay.

of a the losses business the basis But that saying third the the and for quarters XX progresses higher business. Medicare points of earnings, improvement loss MCRs that in seasonality core have half clearly due the in to points strength in are the Medicaid in earnings to no quarters related year the of we is contract ratios of the offset year We it's fourth the normal reasons. Obviously, revenue a if and due the the back thing. enough in the our in general it's The quarters. as And X of produce loss business projected fourth get and performance improvement one It's in will to variety marketplace, of power of all Medicaid last just there portfolios. of in second, that. our Medicare the better and third XX basis and MCRs

from offset lost it's of general performance potential reasons, business. strength earnings any for a general So variety business contracts. just happens seasonality the of The the drag to of potentially

well. ask And the then Got it. about to I wanted as SNP regs

this I Specifically, asset more how on to thinking just think bright is whether or . your the about double the M&A. does Or sort strategic you'd about is MA think that the biased the more really I big really deal mean, change first change you Medicare it towards down growth? be begun purchased. motivation of Does Medicaid? organic way

just significant really represents in way very The opportunities is next that It we allow platforms saying we growing. most population one rate here this M&A in of acquisition your first Medicaid going the Medicaid M&A really across more change duly excellent business. have we're And actioned [indiscernible], strategy. the to in us decent eligible the participate growth Bright doesn't that is has robust in footprint look fact what Medicare. number have happen that mean decent and a of combined to over M&A fact years. for all I X monetize opportunity operationally of our we Those to and footprint. will that's very our But opportunity XX-state been but activity we the Medicaid, the

basically out will for population. tenant dual So in Medicaid from with action the final be eligible very pleased that that the which we're the came very, says rule CMS, anchor

Josh The comes next from Research. Nephron with Raskin question

heard second $X.XX that a and Advantage? rate Texas Virginia, Florida. the XXXX a Is follow-up update. from of the I then your curious offset Just there specifically? number? as experience the I'm Has for way And the $X.XX just XXXX M&A thought back $X.XX Medicare the with question annual then go on on that and an you it, acquisition the well. $X.XX, Virginia to about then if and Florida. the Bright changed is say, And pipeline,

Florida question the Go for the Mark to on Virginia it and ahead. earnings. kick I'll

On Virginia about run revenue now, the to just and on billion think EPS about stage, $X.XX we Florida, a $X that's year. full set and right rate

Now look, headwind which, be quarter, the billion is, both a in $X.XX the as guidance. assumption business. But is by unclear. But somewhat and the would be this the to lose is mentioned underlying it our we that and that we're in what exactly fourth still on of Those prepared year's the deposit offset the you simplifying through. $X.X we remarks, is $X.XX. assumption, strength would revenue working protest under are timing component if

So left accretion and embedded earnings. and $X.XX, we we recognized is is rate $X.XX in the CHIP. see of is -- $X.XX that exactly what's if run year, by full $X.XX the STAR this offset for

question business Josh,and for G&A we've full and how of it accretion. $X would slight we the a We've full earnings a related you year billion in accretion. very with your business. we in we business. breakeven on -- in that's very quarter, revenue by inherited related We optimistic X,XXX is which to managed to XX% to actually basis we year And of to the turnaround, that of X%, about ultimate owned second way get operationally managed MCR ratio The in your We -- the XX%. think the X inherited that are to in there a get X. XX% points the show accretion X full $X.X to Operationally simple. $X confident drag breakeven now in a year and carrying Bright breakeven the costs, in business

it to pricing XX%. the will line excellent our to and of of now G&A business cycles down savings But owned have portion of the through the to confident get producing a MCR quarter operating metrics sight embedded we to X earnings. likely in that we're as and we've The very the dynamics for happen need that go sooner

next Fargo. the with And Stephen question Baxter Wells comes from

questions for Two you.

is first, think talking Medicaid or of about some the And question Just new last on out And store getting of Medicaid adjustment? was coming acuity the second then I MLR? XX point could maybe impact hoping how store versus to just improvement is pipeline. just the of potentially new you the spike about, much normal then down bit when you're basis you the seasonality that maybe deal that back

front? pipeline long time there? over And last they XXXX. seems your now you Medicaid was it's maybe close think, I think hear a us to to on X July, just on still think was distribution, XX I maybe could announcement if update there's take the I give know reformation an slowdown just that of months. the in I you been the it some pipeline kind next like maybe in as when about wondering

new from then Medicaid in in the contract XXXX that Choice My and it quarter business on influenced and California [ XX.X% answer I'll XX in acquisition. from volume runs to member came ] new and the -- Nebraska was MCR. That of Mark on the kick of was of first first business, second MCR month half on The in Iowa the new XX% business heavily Stephen, quarter Medicaid either our question expected the in our or the the by 'XXs. as

first in pressure can Medicaid quarter. math. the do MCR you on created That the So the

that Molina versus and third second, this operational a It dimensions As high we quarter, different earnings out way and work year which all playbook, tilt pattern year. performance starts prior care, fourth improved the the across the of really years. improvements managed creates improves, the emerging very is to through throughout the

we're hit guidance XX As end the last on year few are and the of long-term I in is target Medicaid, range. in MCRs points target than still which to basis on the XX% full first our at said, Mark? the our better top quarters

that. MCR A Stephen, our Medicaid XX.X%. add I'd to just was ago, year

to was that. the legacy This quarter, close NCR very

expectations. little XX.X% And Joe hot. earnings comes is where of in that were We consistent function loaded bit a back-end with our we that we mentioned, right and expected. out this at came year, out MCR, a said new coming as store really recall, margins So which

I stage pipeline, wouldn't the always a fits of we On to slowed it constantly advanced I deal most have down. Joe discussions. important say It's starts. and is and What's pipeline

often, we're not-for-profits. where which Sometimes one-off they're processes, appealing discussions, many they're banker as story, just the development out very bespoke is relationship to but selling Molina

a if are one we wand got of our both we could see. we quarter. hopeful we've what pipeline we So look, seen exactly developing. that But We and where waive you is it, pipeline time the like want have always good them might this

on So that. stay tuned

question America. comes of Kevin with from next The Bank Fischbeck

growth on Can exchange Medicaid like still the tailwind you exchanges. recapture are when redeterminations the a Medicaid talk that be side sounds little numbers? of the but from about the things. It and about on the fully both rate. XX% kind bit And should you XX% how done, side, of a I expect talked guess going, then into you're strong you

see about acuity Just trying the any details of population. to that

the entire estimate I'll high start to to but I'll at in we We grown X recap the off due the process. just to kick start to from finish. members million pause the PHE, it process the and that redetermination redetermination have Mark, of then

another reconnect continue perhaps we reconnect have redetermination lost on in and now a of XX% quarter. late XXX,XXX into stops, even into the spring are experiencing the will XX,XXX process XXX,XXX projecting second rate. to been the lose rate once to the We those, summer. date, that And

increase our are marketplace. special We a significant seeing enrollment in in

or from self-reporting Medicaid in is coming not you're whether a feature. Now

heavily in by So XX,XXX Mark, of marketplace. But add? Medicaid into which from coming we anything SEP influenced many members off quarters, other averaging we've are that's double. members up to companies' statistics to and on roles. been is obviously to have prior XX,XXX exact don't how hour, being coming It's Medicaid XX,XXX

Yes.

obviously this normal the Remember, folks reported And our year. Marketplace the look always coming to had year. you go through redeterminations, guidance. per first in which an quarter. we lapses members from If in unchanged. That's XXX,XXX XXX,XXX marketplace, at anomaly We'll strength on continued of is original that's our the

the both volumes reconnect to declined through will on about year. We're rate. XX% marketplace year asked of XXX,XXX.I case, think increase through typically, in reconnects the guidance the our you this seeing So still And to MORs change an the in. that reconnects, not we're on marketplace the year. well outlook folks as anomaly for coming as back would coming the really in seeing the our

on we right Kevin, be. . where So want track, to right pretty much

comes the Rice question A.J And next from UBS. with

When Thanks. will to pool into we of on for get little Hi, of everybody. have Maybe you do on year, all year? whatever year. just states that have this -- to that subside you this of follow you train the redeterminations for a you above-average acuity you of focus. different a the as next that legacy, these got but increases year, increases acuity decent Medicaid. in move Do rate risk early thought, as reflected date, of given you'll impact that XX fully rate Obviously, there we change the stay look next the rate think, at you last is you'll got need run in the through is, proactively at the on signaled summer. second sort when people full

increases whether on timing getting adequate the is what rate And next year? you're knowing for

recap more. XX% adjustments, to X be representing it color. more the actually perhaps We to in be with we're me Mark state are revenue. We have the by adjustments with anticipating we rate kick retroactive acuity have rates XX I'll normal and having more Let rate states, and for way X of and responded had that acuity-related then some the shift. customers commensurate couldn't trends pleased our our environment, been We cost influenced in received where trends

been very rates So been and responsive the actual states sound. have have really

very XX%, is year [indiscernible] end entire the and rate very the on members the long-term producing Look, phenomenon MCR our of our the the the process, MCR we're how of on end to in going unprecedented medical is very, the guiding to in is of book MCRs. higher influencing high at business. X that's and due we're One costs range emerge, pleased XXX,XXX with bringing on for at top unprecedented committed shift with. found redetermination an With those that new the something other X national

is answer The no.

expect trends into and commensurate have the expect add? actually will rates normal cost every we're to experiencing, be to year. to be schedule actually next sound We we rates Mark, them fee in the that's and sound, be reason year increases, to going carved medical process, next benefits anything we believe out, that with

probably rate mentioned kind states Joe of rate wish proactive, they right, to there in. the so increase it as as reactive, react more okay expecting. trend commensurate they like I on rate year. look trend the proactively But we've the increases The seen increases we level for off. the observe as volume. the with this that's mentioned, we're I match And the of You In really saw is put we're to trends did. with many acuity opposed impact think

only leave So this last XX,XXX had members quarter. in XXX,XXX far, we've were

leveled it's So really off.

redebt reAcquity-- the with acuity impact impact similar a here. seen we've And

pressure rates next now, look there's X the rate for year. of our which well good not, on up X time if this for say comes If XX% means new the news for really they're I'd every January rates right is it's January cycle. okay half year, the So revenue back

Obviously, on focused X, if repricing And last the margin. ask could and you've been the product. on maybe years, just I Marketplace Okay. X.X

Now that that growing you thought marketplace sort Or in your that? what's toward your that? and gotten of Any on have long-term place. on strategy update

membership call strategy XXX XX%. a invested and a last we're year points basis we margin what single stable mid-single pretax the reaction why was That Sure. business small business. that's at XX% premium to re-position the at digit profile of to of to maintain into way was revenues look business from the at -- are about silver excess and margins. growing this digit temporal having growing a year, the short-term A.J., and to

never as So that steady business your grow grow allowed, it. in when you else have, isn't results are progression the wary expect being and organically as bidding against we the this you where market, try business. do for like have to product where to the to be We portfolio nice very what But long insurance you're the is because the that's is, year. of in any the I quickly -- out prior who of coming which underwriting market

So this to We're pretax year we're that's be cautious. high steady really us. to the what nice at expect. growth feels good this able margins we rate grow think to going single-digit and maintain But a saw profile I of to

next with Research. Wolfe The from Lake comes question Justin

of A questions here. couple

the expectation that First, your EPS low grow Joe, last Joe, to had to XX% that visibility secondly, XXXX. you for the end an still at quarter, expectation? in mentioned it in Is XX% company looks outlook new And you wins region, mentioned of Texas Texas a the from assuming the that you or amount X your you're you get XX%. of of there's meaning average like that in state get share plants an assuming you're then

your visibility correct? like share First, to the is just I recall share average second, then on on by are way is state what And The here? reason Washington, your state that. in curious currently I'm across you of where broadly getting visibility Texas, regional your plans. share. appears ask a varies in market local that level that Medicaid high-single the above digits versus be I have pretty

Yes.

the building embedded those of XXXX, into changed. changed the we have those has quarter, outlook haven't you years of changed upcoming the we we still and building last for But Obviously, -- earnings changed our at the that how building an blocks Justin, slightly. $X, blocks. actually blocks have view in not gave and emerge composition

into existing from We out will operating likely year. headwind natural footprint. interest talk talked next earnings. declines harvest about Obviously, about to there We our be a continue leverage, of embedded earnings rate

not use regions know. building think won our of haven't anything reasonable it's guidance, look On what our estimates read of be average margins. and more the to market very I what used think likely Texas, the conservative that's business forward So outlook. share and it will still would for that XXXX, portfolio that X in of kind an don't estimate the into changed, and produce. to conservative that. again, we don't we We blocks but there's We a than

can share So assumption? that you market share

want -- it's our don't early, to we get customer ahead far don't I that. and too on of

allocated. be into we until visibility we'll how have will wait more So see membership and

that's the thing prudent do to think I here.

comes Rich question next Goldman from The Nathan Sachs. with

of and in Joe, normal to for be that care factors get for you Florida. and state. if view, potential protests a of kind wins, shifted friction more that a assumption about the I'd more than I guess, by revenue talked view, create, outcome And your different. be changes a number model in the does bucket. ask could wanted to to in think ultimate target comprehensive $XX Florida to guess And appeals I I ask I that the an your the I follow-up, you curious of view on the RFP process wanted there updated XXXX. Obviously, included had then other there? but billion some are as on

point like still revenue. right that's you shooting the So if curious just feel for XXXX

take will will In, discussions more how sort a on end, prediction process. precedent. this on it's citing that of the historical not making Florida, of would process beginning unfold. suggest that that of we're not there's the the We're precedent place. Historical the the is end

But conversations regions of you So get procurements given. this. and at have Florida, extended ahead in I want the not are don't in there state the to, on that have been again, there still do Florida past X awards look maximum if

So again, historical precedent. citing just

a and are but Kansas process. billion we $XX have STAR sitting On Georgia revenue, billion I Texas out mentioned, contract the there and currently Kids. of new in pipeline. $XX live as

momentum Texas. of We State have the in great

didn't North plan North bid Carolina Carolina, down last in to our too time we because was on turnaround it anything. be early

prospects about pretty and good at feeling we we're $XX looking new X growth business for for We're X we're Look, wins. journey. the XX our and reprocurements So for pipeline there. and started X billion our

second years. long-term target the XX% revenue XX% X the have to ability $X even of revenue produce really though we're situations about X here Nothing's XX% past in RFP share and feeling good growth to M&A continued to over and We're earnings with our transactions per X changed. here, -- the in trajectory disappointed quarter And our quarter. We growth. the billion first the revenue totaling XX%

question from TD Taylor with Gary comes next The Calin.

the had leaving just that. expiring I the politics a just whether actually. I about because get policy XXXX, lot they maybe for renewed of questions ACA credits get X aside or One, and asked not

a thinking what be material of the about those some What fairly you're of be, in just impact that the might basis, exchange see from are is wondering, required, if sort you went of categories income product, percentage demand thinking guys now, retained. case, Just level would if the the elasticity for technical of away. much change how end worst a premium how

And then managed earlier the this Medicaid second was question would just care, rule. be the out big Medicaid week, rule that

a changes to state-directed felt I transparency, wanted forward. few I if to changes. on we know there's material there MCO you see things going the MLR just are payments think that but was there, primarily anything you focused reporting I were on

to away the -- I your legislation less the extend first they to bear I will. was enhancement unless going They it them them. hard do question On is on go -- it's for legislation in That's because sometimes is -- understand they subsidies -- say. away Marketplace. passed was and the extend believe passed mind, are a that's to subsidy misunderstood. temporary. enhanced

think can gets I Now legislative can for here, scenarios but of it's already up gets go benefit people leverage if going scenarios. how enhanced and members didn't grow We it the of subsidized. a lots push did very make who most low-income subsidies we those by done. an and our political of as membership highly cuts. of we lot was a on members, came We subsidized, not because XX-XX tax when footprint. through very, our mind, enhanced given probably highly after in go Medicaid conclusions political subsidies There's not that, easily Trump extension any types that done that be and to I'm all keep the significantly in our

in the question. So I terms us the from a it your at not issue way that's first loss. our of would perspective, for of membership we're as part huge And answer looking

part second make understood which The had sure to your question. to do I with want ruling. I

access care, that accrual earlier managed this managed out Medicaid the finance week. was quality care The

lots very aware many analyzing features analyzing which incept of to obviously it, still Not over it. different We're of significant. it. We're of We're it. extended periods time. of

nothing react long-term changes the that immediately nothing of in business. of But to So there's the guideline to. trajectory

things whether are I've many the is think the of major the the answer legislative political votes Senate you're do can viability in. reconciliation the political -- businesses neutral concern the of the fundamental, we're XX I And no. something election vis-a-vis process, the in scenarios pretty there you The get et environmental split, asked, for sustainability the needed any done comes legislative to in. cetera. don't is judicial As we and on times, We that the is often causes businesses issue said Congress out, or whether way

through or good the certainly I and that's and to Medicaid we have thing think coverage our easier for go the and it Gary, people, right eligibility, they makes it is items go get one would eligibility streamline out appropriate all for folks point just to procedural tailwind to maintain when business. the chip obviously the that to a

The Bank. Hill, next George question comes Deutsche from

Joe, just a high-level question.

book. One your about would to and population. talked business subsidized D-SNP normalized margin normalized of what if of know willing and you MA the a how But little different. a the kind heavily just peers you margin kind guys And you your I wondering individual book of speak or I have profile guys bit between better. individual MA think that this you the X% I book that was week that is of varies a individual be of is to think know of

but So color. the any book is a little bit I appreciate different,

I referring products XX%. we're Medicare business range for pretax XX% sure in to after or is pretax. target our our Well, wasn't to our Yes. is the for tax, whether you're NCR mid-single-digit

said, we couple down projecting here get years. XX% hope. to not we hope right -- to As to next of over the We're get

pretax So margins business. this in still mid-single-digit we target

population Medicaid We us. be our produce footprint like significant D-SNP to business growth here monetizing over is a for the profits, not time can but only category going eligible excellent for dual

at So we're in deorgible in range. population positioned, the take growth MCRs well we to XX% positioned mid-single-digit here, the we're still least advantage XX% and the target perfectly but well, margins, of pretax to

the is of eligibles. competitors Remember, a business to George, only we add thing of some to hard our in it's really the Medicare. really big compare dual heavily to skew I'd book Molina

So acuity. book high are high which in an teens our PMPMs, $X,XXX awful we've got lot of the to

there's at good managing members to very margins presence opportunity you're some to costs headwinds. about, get -- a talked in the medical the those even If Joe on of big that high-dollar

think I comparison hard really others. to to that So it's make

And comes with Fidel Stephens. question from the next Scott

Two questions.

us the been in thoughts on in your points you've your able of after appeal offer gotten that? far, if have you scoring HICS to and on this and And the basis is just one, the second, the you're then first to side, definitely refresh so business. XXXX just want interested results for margin HICS results just for start The MLR point Florida yet be develop to expecting the may if seeing at pretax Florida from factual what year full that

and through unfold. all protest of these On I they document the course, everybody's their them. got processes, sure findings about really how They information about have are we to requests, to to think various said and I'm they say I've need put should But see case I forward. processes, legal their

about So I'll all it. say that's

was about marketplace. market question last to Your

having that margin X XXX we, places, in last consciously We some and [indiscernible] decided points margins the up, said, business, priced XX% basis I of why invest is XX%, membership producing good to in into we revenues double-digit pretax low visibility having which As growth, grew were grew year, into XX%. XX%.

to to to and our XX% nice to renewal finish XX% of range, margin. which year would as expect platform being to year, to produce positioned off target And a of that membership position, at now low we which single-digit the MCR So half And produce high is end which It's this silver, the of pretax we're where well the range. very stable membership, continue right XX%. suggested a be. grow it modestly. being measurably earlier, we want a somebody

Got it. Okay.

for initial exchange us the the guidance you gave margin? So reaffirming MLR

Barclays. Mok And with the from comes Andrew next question

that And that reserves? think PYD favorable I did say Was there you heard to your you're your in change. quarter? any the reestablish if into you prudent in so, I due reserves

lower. And reserves. on not normally it It's Mark. Yes, we favorable as higher, does, course, there's showed of where absolutely, and always tracks prior in see earnings the year the PYD, current replenish that that. we not year you'll It about release development

noise of very very that showed we reserves change good happened standard with I in feel days claims the our We of February. is a from about XX% So right confident middle situation which payable, bit in feel a range. even little back the our

adequately So confident, we reserves reserved. replenished, feel very

quarter impact from any in the there the PYD? Was P&L

There a normal there bit little way always process periods unusual That you developed current earnings. reserving a and the quarter. Typically, is in you in how recognize conservative. And of standard generally this is of a typically, we cycle. number, pick a Nothing a period, is and the cycle actuarial is. That's reserving favorably. part which reserve the prior

from comes question Fitzgerald. next Cantor Sarah James with the And

clarify I guide. on XXXX wanted revenue the the to mix

mix? So X/X your versus you contracts organic, January of contract then April guys us talked wins. What any clarity about see timing? about in being it quarter as you that on you the IDA, XX% And rate September. Do could percentage your and M&A and renewal still book give renews

first. question second answer I'll the

renewal which throughout risk know to XX% cost The of year. is visibility. the rate great better XX% given you And now, leaves the we is of it so half [indiscernible] year. portfolio, second the our risk our get a we nicely revenue pattern -- perspective. is pressure, how on the fall. pressure, said, of of from that's in laddered revenue this a as for in That's have rest guidance, the renewal nicely really Right Mark if little our our we We management know in pattern the XX% our year's revenue us on rates rates, have X. renews great January the renews forecast. which guide, of very

then XX% revenue capture January we fact, nicely. at X, or In of into that cycles the

was? Your other question

Yes.

about from contract laid in it you as of you buckets out was M&A, of the the from organic? XXXX, XX% do wins, On at premium growth the that XX% $XX rev think being which I-Day, billion from XX%

Yes.

I more That changes, that's it. more them again, if that's to to about bucket way mix But caused M&A. change, we we we actual feel the the But more embedded that accretive think we It's good and the at very way a long buy When it's outlook very the buy which contract mean high-level it. has but outlook. us with have comes that of M&A, about efficiency, as we refilling mix properties is change could probably I earnings, wins we're think as the buying that's from it. nothing the capital all fine. and of think it them. and about you're

this much Thank And as the call you so presentation. concludes itself. for attending as well today's the question session

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