Elevance Stumbles A Bit In Q2 But Recovering
Elevance Health is kicking off another round of quarterly earnings results for health plans. The results are a mixed bag – with ongoing signs of recovery but signals that challenges and uncertainty remain for big insurers and plans in general. Elevance posted $1.5 billion in profit for Q2 and revenue of $50.5 billion, but profit was down from Q2 2025. Elevance is still meeting guidance to investors (and is upping it), but investors wanted more.
Here are some of the troubling signs, which are expected in other big plans too for Q2.
- The medical loss ratio was 89.7% in Q2, with medical costs continuing to rise.
- Elevance will exit the D.C. Medicaid market and may exit more due to the vulnerability in that line and major cutbacks from the One Big Beautiful Bill Act (OBBBA). This could continue the trend of a mismatch between rates and risk selection over time.
- In general, they have shed Exchange lives like others and this likely helped with costs and overall MLR.
Some good news is the settlement on Medicare Advantage (MA) risk adjustment. Elevance will face no sanctions.
Additional articles: https://www.fiercehealthcare.com/payers/elevance-healths-stock-slides-premarket-even-it-beats-street-15b-q2-profit and https://www.modernhealthcare.com/insurance/mh-elevance-health-earnings-state-medicaid-markets/ and https://www.healthcaredive.com/news/elevance-medicaid-exits-q2-2025-2026-earnings-raise/825217/ and https://www.beckerspayer.com/financial/elevance-reports-1-5b-profit-in-q2-membership-dips/
(Some articles may require a subscription.)
#healthplans #margins #medicareadvantage #elevancehealth
https://www.modernhealthcare.com/insurance/mh-elevance-earnings-profit-guidance
340B Costs Hit $100 Billion
More news that will likely mean regulatory or statutory reform of the 340B drug discount program. The federal government has announced that the program now exceeds $100 billion in drug purchases in 2025, a 23% increase over the $81.4 billion of 2024.
The 340B program is increasingly being questioned for its value, many arguing that the discounts are not being passed through to consumers and the discounts are essentially being pocketed by qualifying providers.
The regulatory agency noted that $79.2 billion of the $100 billion goes to disproportionate share hospitals.
#340b #drugpricing #hospitals #providers
New Medicare Doc Pay Bill Would Provide Relief
A new bipartisan Medicare physician bill would provide critical relief to doctors in the program. Critically, it would reverse years of real (against inflation) payment declines in favor of tying annual hikes to inflation and ease the so-called budget neutrality provision in the payment law. The bill would also boost primary care and encourage participation in value-based care programs. One reform would establish a primary care hybrid payment pilot program, with independent physicians receiving a per-member-per-month capitated payment alongside some of their traditional fee-for-service reimbursement. The Merit-based Incentive Payment System (MIPS) would also be reformed as is being proposed by the Trump administration in a new rule.
The formula proposed would take the Medicare Economic Index and subtract one percentage point. I suppose it is a start to real reform.
Doctors will need to lobby for this given the costs and the complexity of unraveling the inequities in existing law in terms of the calculation. Indeed, a rule the Trump administration is championing as real reform actually would reduce 2027 ongoing payments slightly. Further, the one-time increase in 2026 of 2.5% goes away.
Additional article: https://www.fiercehealthcare.com/providers/bipartisan-house-bill-tying-doc-pay-inflation-earns-resounding-applause-providers
(Some articles may require a subscription.)
#medicare #payments #doctors
https://www.modernhealthcare.com/politics-regulation/mh-medicare-physician-pay-bill
Dems Challenge Validity Of PA Reforms
Sens. Richard Blumenthal, D-CT, and Josh Hawley, R-MO, are challenging big health plans to prove that they have reduced prior authorization burdens on members and providers. The senators want records on how each insurer makes post-acute care coverage decisions, especially how the use of artificial intelligence plays a role in the utilization management process.
#healthplans #priorauthorization
— Marc S. Ryan
