Medical membership slips 469,000 in Q2
Elevance Health on Wednesday raised its full-year adjusted earnings outlook to at least $27 per share after reporting second-quarter revenue that topped Wall Street estimates. The Indianapolis-based health insurer posted revenue of $50.47 billion, up 3% from a year earlier, while adjusted earnings per share of $7.45 beat the FactSet consensus estimate of $6.21.
Net income for the quarter fell to $1.46 billion, or $6.71 per share, from $1.74 billion, or $7.72 per share, a year earlier, reflecting higher benefit costs. The company’s benefit-expense ratio, which compares medical costs with premium revenue, rose to 89.7% from 88.9% in the prior-year period.
Elevance attributed the higher ratio primarily to improved performance in individual Affordable Care Act coverage, partly offset by an expected increase in medical costs in its government business. The company’s medical membership totaled 44.9 million as of the end of June, down 469,000 from the prior quarter, driven by a commercial fee-based customer transition and some membership attrition.
For the full year, Elevance expects adjusted earnings of at least $27 per share, up from its previous guidance of $26.75 per share. Analysts polled by FactSet had forecast $26.91 per share. The company also signaled it is increasing investments in medical cost management, member experience, and provider connectivity.
Chief Executive Gail Boudreaux said the updates reinforce management’s confidence in meeting its goal of at least 12% adjusted earnings per share growth in 2027 compared with 2026.