Elevance Reports Good News But Cautions On Medicaid
Elevance Health reported relatively good financial news for Q3 but warned investors about challenges in the Medicaid market. Ongoing eligibility determinations as well as changes to state programs are increasing the acuity of its membership. The company said its Medicaid margins will drop 125 basis points year over year in 2026 due to the eligibility changes and high utilization. This is before widescale reductions take place under the One Big Beautiful Bill Act (OBBBA). Insurers have complained that state Medicaid rates have not recognized actual costs after post-pandemic policy shifts in enrollment.
The other major moving part is the expiration of the enhanced Exchange subsidies, which could leave a sicker cohort and increased risk and costs in that line as well. Elevance also trimmed its Medicare Advantage (MA) footprint to stabilize that line. Its Carelon services entity did not meet investor expectations.
Elevance posted a medical loss ratio, a marker of spending on patient care, of 91.3% — up compared to 89.5% same time last year. Elevance did post double-digit year-over-year growth for both revenue and profits. It had $1.2 billion in profit for the third quarter, up 17% from the $1 billion for the third quarter of 2024. Revenues for the quarter were $50.7 billion, an increase of 12.4% from the $45.1 billion reported in the prior-year quarter. Elevance had $5.1 billion in profit for the first nine months of 2025, down 8% compared to the $5.7 billion in earnings reported through the first three quarters of 2024. Revenues across the first three quarters of 2025 were $149.4 billion, an increase of 13.5% year over year.
In other news, Point32Health has cut an additional 254 jobs to reduce its costs.
Additional articles: https://www.fiercehealthcare.com/payers/elevance-health-shares-rise-premarket-q3-earnings-revenue-beat and https://www.healthcaredive.com/news/elevance-outperforms-q3-2025-warns-medicaid-challenges/803326/ and https://www.beckerspayer.com/financial/elevance-q3-income-up-over-17/ and https://www.beckerspayer.com/workforce/point32health-to-cut-254-jobs/
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#elevancehealth #exchanges #medicareadvantage #medicaid #managedcare #margins
https://www.modernhealthcare.com/insurance/mh-elevance-health-medicaid-2026/
Orphan Drug Exclusion To Cost Government And Consumers Big
A provision of the One Big Beautiful Bill Act favored by Big Pharma means a slew of orphan drugs will be pushed out several years or excluded from Medicare drug price negotiations. The Congressional Budget Office (CBO) says this will cost Medicare Part D $8.8 billion over a decade. This is a revision of an earlier estimate. The new estimate is $3.7 billion higher due to more drugs now being eligible.
Separately, healthcare policy group KFF says the orphan drug change will mean higher out-of-pocket costs for Medicare beneficiaries who use these medications. It dives deep into the drugs covered by the exclusion and their costs.
Additional article: https://www.kff.org/medicare/people-with-medicare-will-face-higher-costs-for-some-orphan-drugs-due-to-changes-in-the-new-tax-and-budget-law/
#ira #drugpricing #obbba
New CR To Be Considered
Republican leaders are making plans for a longer continuing resolution (CR) to fund the government at current levels as the government shutdown continues. The existing resolution has been shot down in the Senate by Democrats and the 7-week term is now too short to really pass it. This will require the House to return to pass a CR with a new funding expiration date. More time is needed to craft full appropriations bills. Many options are on the table for an expiration date, including level funding through September 30, the end of federal fiscal year 2026. But many want to set a financial blueprint and a December date may be most favorable.
A group of moderate and swing district House Republicans on Tuesday called on Speaker Mike Johnson, R-LA, to immediately address the expiring enhanced Exchange premium subsidies once the shutdown ends.
Additional article: https://thehill.com/homenews/house/5566100-government-shutdown-republican-plans
#governmentshutdown #congress #trump #healthcare #coverage #exchanges
https://thehill.com/homenews/house/5566174-house-republicans-obamacare-tax-credits/?tbref=hp
— Marc S. Ryan
