Elevance Health (ELV) investor relations material

Regulatory and compliance updates

• Progress made with CMS on Medicare Advantage sanctions, with no intermediate sanctions imposed and remaining steps largely procedural through July 31.

• Initial remittance of $340 million to CMS for historical payment disputes, fully covered by prior accruals.

• No expected material impact on Medicare Advantage enrollment, margins, or participation in the upcoming annual election period.

• Confidence expressed in current risk adjustment practices and compliance framework.

Utilization and cost trends

• Second quarter trends in April and May support confidence in earnings guidance and benefit expense ratio outlook.

• Medicare Advantage performance favorable due to portfolio actions, care management, and membership composition.

• Individual ACA experience tracking in line to slightly favorable, with a shift toward bronze plans affecting cost timing.

• Medicaid cost trend remains elevated, especially in behavioral health and emergency visits, but margin expectations are maintained.

• Employer group performance aligns with expectations, supported by disciplined pricing and integrated solutions.

Earnings outlook and growth drivers

• Reaffirmed expectation for at least 12% adjusted EPS growth in 2027, with 2026 as a repositioning year.

• Operational levers include disciplined pricing, medical management, payment integrity, and care coordination.

• Carelon is a key growth driver, leveraging clinical expertise, data, and technology for cost and quality improvements.

• Investments in technology, automation, and AI are expected to support margin expansion.

• Strong cash flow enables continued investment and disciplined capital returns.