Le Lézard
Classified in: Business, Covid-19 virus
Subjects: EARNINGS, Conference Call, Webcast

Elevance Health Reports Results for Fourth Quarter and Full Year 2023; Sets Full Year 2024 Outlook


Elevance Health, Inc. (NYSE: ELV) reported fourth quarter and full year 2023 results.

"We are pleased to have delivered another year of strong performance in 2023, enabled by our relentless focus on customer experience and affordability, and continued investments in growth and innovation. The balance and resilience of our business coupled with the focused execution of our enterprise strategy supports our confidence in our outlook for 2024, as we continue to optimize the foundation, and scale our flywheel for sustained growth of the enterprise over the long term."

Gail K. Boudreaux

President and Chief Executive Officer

1.

Earnings per diluted share ("EPS")

2.

Refer to GAAP reconciliation tables herein for reconciliation of GAAP to adjusted measures.

 

 

 

 

 

 

 

 

 

 

 

 

 

Elevance Health

 

 

Consolidated Enterprise Highlights

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In billions)

Three Months Ended

 

Twelve Months Ended

 

 

 

December 31,
2023

 

December 31,
2022

 

September 30,
2023

 

December 31,
2023

 

December 31,
2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Revenue1

$42.5

 

 

$39.7

 

 

$42.5

 

 

$170.2

 

 

$155.7

 

 

 

Operating Gain1,2,3

$1.3

 

 

$1.3

 

 

$1.8

 

 

$8.5

 

 

$8.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Margin1

3.0

%

 

3.2

%

 

4.1

%

 

5.0

%

 

5.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

1.

See "Basis of Presentation."

2.

Operating Gain for the three and twelve months ended December 31, 2023 and December 31, 2022 include items that are excluded from adjusted shareholders' net income. See "GAAP Reconciliation."

3.

Operating Gain for the three and twelve months ended December 31, 2022 have been restated. See "GAAP Reconciliation."

Operating revenue was $42.5 billion in the fourth quarter of 2023, an increase of $2.8 billion, or 7 percent compared to fourth quarter 2022. Operating revenue was $170.2 billion in 2023, an increase of $14.5 billion, or 9 percent. The increase in the quarter and year was driven by higher premium revenue in our Health Benefits segment and growth in pharmacy product revenue in CarelonRx.

The benefit expense ratio was 89.2 percent in the fourth quarter, an improvement of 50 basis points compared to fourth quarter 2022, and 87.0 percent for the full year, an improvement of 60 basis points year-over-year. The improvement in the quarter and year was driven by premium rate adjustments to cover medical cost trend. Days in Claims Payable was 47.3 days as of December 31, 2023, a decrease of 1.3 days from September 30, 2023, and a decrease of 0.2 days compared to December 31, 2022.

The operating expense ratio was 11.8 percent both in the fourth quarter and for the full year of 2023, an increase of 30 basis points as compared to the fourth quarter of 2022 and an increase of 40 basis points year-over-year. The increase in the quarter was driven by an acceleration of investments for growth and the increase for the full year was driven by business optimization charges recorded in 2023.

Cash Flow & Balance Sheet

Operating cash flow for 2023 was $8.1 billion, or 1.3 times GAAP net income. As of December 31, 2023, cash and investments at the parent company totaled approximately $1.6 billion.

During the fourth quarter of 2023, the Company repurchased 2.0 million shares of its common stock for $929 million, at a weighted average price of $465.63. For the full year of 2023, the Company repurchased 5.8 million shares of its common stock for $2.7 billion, at a weighted average price of $463.53. As of December 31, 2023, the Company had approximately $4.2 billion of Board approved share repurchase authorization remaining. During the fourth quarter of 2023, the Company paid a quarterly dividend of $1.48 per share, representing a distribution of cash totaling $346 million.

Health Benefits is comprised of Individual, Employer Group risk-based, Employer Group fee-based, BlueCard, Medicare, Medicaid, and Federal Health Products & Services businesses.

 

 

 

 

 

 

 

 

 

 

 

 

 

Health Benefits

 

 

Reportable Segment Highlights

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In billions)

Three Months Ended

 

Twelve Months Ended

 

 

 

December 31,
2023

 

December 31,
2022

 

September 30,
2023

 

December 31,
2023

 

December 31,
2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Revenue1

$36.5

 

 

$35.0

 

 

$36.7

 

 

$148.6

 

 

$138.5

 

 

 

Operating Gain1,2

$0.8

 

 

$0.8

 

 

$1.8

 

 

$6.9

 

 

$6.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Margin1

2.1

%

 

2.2

%

 

5.0

%

 

4.6

%

 

4.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

1.

See "Basis of Presentation."

2.

Operating Gain for the three and twelve months ended December 31, 2022 and three months ended September 30, 2023 have been restated for the realignment of Carelon Global Solutions. See footnote 4 to the Reportable Segment Highlight Details for more detail.

Operating revenue was $36.5 billion in the fourth quarter of 2023, an increase of $1.5 billion, or 4 percent compared to fourth quarter 2022. Operating revenue was $148.6 billion in 2023, an increase of $10.1 billion, or 7 percent. The increase was primarily driven by higher premium revenue in our Commercial Health Benefits business.

Operating gain totaled $767 million in the fourth quarter of 2023, a decline of 2 percent compared to the fourth quarter of 2022. This was primarily driven by investments made in the quarter to support long-term growth. Operating gain totaled $6.9 billion in 2023, an increase of $866 million, or 14 percent year-over-year. This was primarily driven by premium rate adjustments to reflect medical cost trends.

Medical membership totaled approximately 47.0 million as of December 31, 2023, a decrease of 570 thousand, or 1 percent year-over-year. This was driven by attrition in our Medicaid business associated with the resumption of eligibility redeterminations in the second quarter of 2023 and declines in our Employer Group risk-based business. These membership losses were partially offset by growth in BlueCard, Affordable Care Act health plans, and Medicare Advantage.

During the fourth quarter of 2023, medical membership declined by 364 thousand driven by Medicaid membership attrition associated with redeterminations, partially offset by growth in commercial fee-based members.

Carelon is comprised of CarelonRx and Carelon Services.

 

 

 

 

 

 

 

 

 

 

 

 

 

Carelon

 

 

Reportable Segment Highlights

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In billions)

Three Months Ended

 

Twelve Months Ended

 

 

 

December 31,
2023

 

December 31,
2022

 

September 30,
2023

 

December 31,
2023

 

December 31,
2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Revenue1,2,3

$12.4

 

 

$10.9

 

 

$12.0

 

 

$48.0

 

 

$41.4

 

 

 

Operating Gain1,2,3

$0.6

 

 

$0.5

 

 

$0.7

 

 

$2.7

 

 

$2.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Margin1

4.8

%

 

4.7

%

 

5.6

%

 

5.5

%

 

5.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

1.

See "Basis of Presentation."

2.

Operating Revenue and Operating Gain for Carelon in millions for the three months ended December 31, 2023 included $8,827 and $490 for CarelonRx; and $3,574 and $102 for Carelon Services, respectively. Operating Revenue and Operating Gain for Carelon for the three months ended December 31, 2022 included $7,523 and $475 for CarelonRx; and $3,342 and $39 for Carelon Services, respectively. Operating Revenue and Operating Gain for Carelon for the twelve months ended December 31, 2023 included $33,835 and $1,975 for CarelonRx; and $14,147 and $680 for Carelon Services, respectively. Operating Revenue and Operating Gain for Carelon for the twelve months ended December 31, 2022 included $28,526 and $1,868 for CarelonRx; and $12,860 and $535 for Carelon Services, respectively.

3.

Operating Revenue and Operating Gain for the three and twelve months ended December 31, 2022 and three months ended September 30, 2023 have been restated for the realignment of Carelon Global Solutions. See footnote 4 to the Reportable Segment Highlight Details table for more detail.

Operating revenue in the Carelon segments was $12.4 billion in the fourth quarter of 2023, an increase of $1.5 billion, or 14 percent from fourth quarter 2022. Operating revenue was $48.0 billion in 2023, an increase of $6.6 billion, or 16 percent. The increases for the quarter and the year were driven by growth in pharmacy product revenue in CarelonRx associated with growth in both external pharmacy members served and the acquisition of the BioPlus specialty pharmacy.

Operating gain in the Carelon segments was $592 million in the fourth quarter of 2023, an increase of $78 million, or 15 percent from fourth quarter 2022. The increase in the quarter was primarily driven by improved performance in our Carelon Services businesses. Operating gain was $2.7 billion in 2023, an increase of $252 million, or 10 percent year-over-year. The increase for the full year was primarily driven by higher prescription volumes in CarelonRx associated with growth in external pharmacy members served, the acquisition of the BioPlus specialty pharmacy, and improved performance across our Carelon Services businesses, along with the continued expansion of our post-acute care management business.

About Elevance Health

Elevance Health is a lifetime, trusted health partner fueled by its purpose to improve the health of humanity. The company supports consumers, families, and communities across the entire care journey ? connecting them to the care, support, and resources they need to lead healthier lives. Elevance Health's companies serve more than 115 million people through a diverse portfolio of industry-leading medical, digital, pharmacy, behavioral, clinical, and complex care solutions. For more information, please visit www.elevancehealth.com or follow us @ElevanceHealth on X and Elevance Health on LinkedIn.

Conference Call and Webcast

Management will host a conference call and webcast today at 8:30 a.m. Eastern Standard Time ("EST") to discuss the company's fourth quarter and full year results and outlook. The conference call should be accessed at least 15 minutes prior to the start of the call with the following numbers:

888-947-9963 (Domestic)

800-568-3942 (Domestic Replay)

312-470-0178 (International)

203-369-3812 (International Replay)

The access code for today's conference call is 3972058. There is no access code for the replay. The replay will be available from 11:30 a.m. EDT today, until the end of the day on February 23, 2024. The call will also be available through a live webcast at www.elevancehealth.com under the "Investors" link. A webcast replay will be available following the call.

Basis of Presentation

  1. Operating revenue and operating gain/loss are the key measures used by management to evaluate performance in each of its reporting segments, allocate resources, set incentive compensation targets and to forecast future operating performance. Operating gain/loss is calculated as total operating revenue less benefit expense, cost of products sold and operating expense. It does not include net investment income, net gains/losses on financial instruments, interest expense, amortization of other intangible assets, gains/losses on extinguishment of debt or income taxes, as these items are managed in a corporate shared service environment and are not the responsibility of operating segment management. Refer to the GAAP reconciliation tables.
  2. Operating margin is defined as operating gain divided by operating revenue.

Elevance Health

Earnings Release Financial Schedules and Supplementary Information

Quarter and Year Ended December 31, 2023

Elevance Health

Membership and Other Metrics

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change from

Medical Membership (in thousands)

December 31,
2023

 

December 31,
2022

 

September 30,
2023

 

December 31,
2022

 

September 30,
2023

Individual

1,025

 

789

 

999

 

29.9

%

 

2.6

%

Employer Group Risk-Based

3,756

 

3,988

 

3,754

 

(5.8

) %

 

0.1

%

Commercial Risk-Based

4,781

 

4,777

 

4,753

 

0.1

%

 

0.6

%

BlueCard®

6,838

 

6,462

 

6,756

 

5.8

%

 

1.2

%

Employer Group Fee-Based

20,227

 

20,174

 

20,166

 

0.3

%

 

0.3

%

Commercial Fee-Based

27,065

 

26,636

 

26,922

 

1.6

%

 

0.5

%

Medicare Advantage

2,047

 

1,977

 

2,064

 

3.5

%

 

(0.8

) %

Medicare Supplement

923

 

947

 

928

 

(2.5

) %

 

(0.5

) %

Total Medicare

2,970

 

2,924

 

2,992

 

1.6

%

 

(0.7

) %

Medicaid

10,503

 

11,571

 

11,018

 

(9.2

) %

 

(4.7

) %

Federal Employees Health Benefits

1,642

 

1,623

 

1,640

 

1.2

%

 

0.1

%

Total Medical Membership

46,961

 

47,531

 

47,325

 

(1.2

) %

 

(0.8

) %

Other Membership (in thousands)

 

 

 

 

 

 

 

 

 

Life and Disability Members

4,629

 

4,834

 

4,611

 

(4.2

) %

 

0.4

%

Dental Members

6,820

 

6,692

 

6,775

 

1.9

%

 

0.7

%

Dental Administration Members

1,729

 

1,586

 

1,708

 

9.0

%

 

1.2

%

Vision Members

9,944

 

9,813

 

9,861

 

1.3

%

 

0.8

%

Medicare Part D Standalone Members

260

 

271

 

261

 

(4.1

) %

 

(0.4

) %

Other Metrics (in millions)

 

 

 

 

 

 

 

 

 

CarelonRx Quarterly Adjusted Scripts

78.0

 

82.0

 

77.3

 

(4.9

) %

 

0.9

%

Carelon Services Consumers Served

103.3

 

105.0

 

104.8

 

(1.6

) %

 

(1.4

) %

Elevance Health

Consolidated Statements of Income

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

(In millions, except per share data)

Three Months Ended

December 31

 

 

Twelve Months Ended

December 31

 

 

2023

 

 

 

2022

 

 

Change

 

 

 

2023

 

 

 

2022

 

 

Change

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

Premiums

$

35,138

 

 

$

33,646

 

 

4.4

%

 

 

$

142,854

 

 

$

133,229

 

 

7.2

%

Product revenue

 

5,394

 

 

 

4,137

 

 

30.4

%

 

 

 

19,452

 

 

 

14,978

 

 

29.9

%

Service fees

 

1,922

 

 

 

1,884

 

 

2.0

%

 

 

 

7,903

 

 

 

7,453

 

 

6.0

%

Total operating revenue

 

42,454

 

 

 

39,667

 

 

7.0

%

 

 

 

170,209

 

 

 

155,660

 

 

9.3

%

Net investment income

 

529

 

 

 

373

 

 

41.8

%

 

 

 

1,825

 

 

 

1,485

 

 

22.9

%

Net losses on financial instruments

 

(336

)

 

 

(111

)

 

NM

 

 

 

 

(694

)

 

 

(550

)

 

NM

 

Total revenues

 

42,647

 

 

 

39,929

 

 

6.8

%

 

 

 

171,340

 

 

 

156,595

 

 

9.4

%

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

Benefit expense

 

31,334

 

 

 

30,195

 

 

3.8

%

 

 

 

124,330

 

 

 

116,642

 

 

6.6

%

Cost of products sold

 

4,837

 

 

 

3,646

 

 

32.7

%

 

 

 

17,293

 

 

 

13,035

 

 

32.7

%

Operating expense

 

4,999

 

 

 

4,567

 

 

9.5

%

 

 

 

20,087

 

 

 

17,700

 

 

13.5

%

Interest expense

 

259

 

 

 

229

 

 

13.1

%

 

 

 

1,030

 

 

 

851

 

 

21.0

%

Amortization of other intangible assets

 

217

 

 

 

247

 

 

(12.1

)%

 

 

 

885

 

 

 

767

 

 

15.4

%

Total expenses

 

41,646

 

 

 

38,884

 

 

7.1

%

 

 

 

163,625

 

 

 

148,995

 

 

9.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income tax expense

 

1,001

 

 

 

1,045

 

 

(4.2

)%

 

 

 

7,715

 

 

 

7,600

 

 

1.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

170

 

 

 

168

 

 

1.2

%

 

 

 

1,724

 

 

 

1,712

 

 

0.7

%

Net income

 

831

 

 

 

877

 

 

(5.2

)%

 

 

 

5,991

 

 

 

5,888

 

 

1.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss (income) attributable to noncontrolling interests

 

25

 

 

 

(12

)

 

NM

 

 

 

 

(4

)

 

 

6

 

 

NM

 

Shareholders' net income

$

856

 

 

$

865

 

 

(1.0

)%

 

 

$

5,987

 

 

$

5,894

 

 

1.6

%

Shareholders' earnings per diluted share

$

3.63

 

 

$

3.59

 

 

1.1

%

 

 

$

25.22

 

 

$

24.28

 

 

3.9

%

Diluted shares

 

235.8

 

 

 

241.2

 

 

(2.2

)%

 

 

 

237.4

 

 

 

242.8

 

 

(2.2

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefit expense as a percentage of premiums

 

89.2

%

 

 

89.7

%

 

(50) bp

 

 

 

87.0

%

 

 

87.6

%

 

(60) bp

Operating expense as a percentage of total operating revenue

 

11.8

%

 

 

11.5

%

 

30 bp

 

 

 

11.8

%

 

 

11.4

%

 

40 bp

Income before income tax expense as a percentage of total revenue

 

2.3

%

 

 

2.6

%

 

(30) bp

 

 

 

4.5

%

 

 

4.9

%

 

(40) bp

"NM" = calculation not meaningful

Elevance Health

Condensed Consolidated Balance Sheet

(In millions)

December 31,
2023

 

December 31,
2022

Assets

(Unaudited)

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

6,526

 

$

7,387

Fixed maturity and equity securities

 

29,843

 

 

26,905

Premium and other receivables

 

17,865

 

 

16,044

Other current assets

 

5,795

 

 

5,281

Total current assets

 

60,029

 

 

55,617

 

 

 

 

Long-term investments

 

6,983

 

 

6,437

Property and equipment, net

 

4,359

 

 

4,316

Goodwill and other intangible assets

 

35,590

 

 

34,698

Other noncurrent assets

 

1,967

 

 

1,687

Total assets

$

108,928

 

$

102,755

 

 

 

 

Liabilities and equity

 

 

 

Liabilities

 

 

 

Current liabilities:

 

 

 

Medical claims payable

$

16,111

 

$

15,596

Short-term borrowings

 

225

 

 

265

Current portion of long-term debt

 

1,649

 

 

1,500

Other current liabilities

 

23,806

 

 

22,335

Total current liabilities

 

41,791

 

 

39,696

 

 

 

 

Long-term debt, less current portion

 

23,246

 

 

22,349

Other noncurrent liabilities

 

4,486

 

 

4,380

Total liabilities

 

69,523

 

 

66,425

 

 

 

 

Total shareholders' equity

 

39,306

 

 

36,243

Noncontrolling interests

 

99

 

 

87

Total equity

 

39,405

 

 

36,330

Total liabilities and equity

$

108,928

 

$

102,755

Elevance Health

Condensed Consolidated Statement of Cash Flows

(Unaudited)

 

 

 

 

(In millions)

Twelve Months Ended December 31

 

2023

 

 

2022

 

 

 

 

 

Operating activities

 

 

 

Net income

$5,991

 

 

$5,888

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation and amortization

1,745

 

 

1,675

 

Share-based compensation

289

 

 

264

 

Changes in operating assets and liabilities

(534

)

 

423

 

Other non-cash items

570

 

 

149

 

Net cash provided by operating activities

8,061

 

 

8,399

 

 

 

 

 

Investing activities

 

 

 

Purchases of investments, net of sales and maturities

(2,700

)

 

(2,338

)

Purchases of subsidiaries, net of cash acquired

(1,552

)

 

(649

)

Purchases of property and equipment

(1,296

)

 

(1,152

)

Other, net

(24

)

 

(421

)

Net cash used in investing activities

(5,572

)

 

(4,560

)

 

 

 

 

Financing activities

 

 

 

Net change in short-term and long-term borrowings

626

 

 

862

 

Repurchase and retirement of common stock

(2,676

)

 

(2,316

)

Cash dividends

(1,395

)

 

(1,229

)

Other, net

96

 

 

1,365

 

Net cash used in financing activities

(3,349

)

 

(1,318

)

 

 

 

Effect of foreign exchange rates on cash and cash equivalents

(1

)

 

(14

)

 

 

 

 

Change in cash and cash equivalents

(861

)

 

2,507

 

Cash and cash equivalents at beginning of period

7,387

 

 

4,880

 

 

 

Cash and cash equivalents at end of period

$6,526

 

 

$7,387

 

REPORTABLE SEGMENTS

Elevance Health has four reportable segments: Health Benefits (comprised of Individual, Employer Group risk-based, Employer Group fee-based, BlueCard, Medicare, Medicaid, and Federal Health Products & Services businesses); CarelonRx; Carelon Services; and Corporate & Other (comprised of businesses that do not individually meet the quantitative thresholds for an operating division as well as corporate expenses not allocated to our other reportable segments).

 

 

 

 

 

 

 

 

 

 

 

 

Elevance Health

Reportable Segment Highlight Details

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

(In millions)

Three Months Ended December 31

 

Twelve Months Ended December 31

 

 

2023

 

 

 

2022

 

 

Change

 

 

2023

 

 

 

2022

 

 

Change

 

 

 

 

 

 

 

 

 

 

 

 

Operating Revenue

 

 

 

 

 

 

 

 

 

 

 

Health Benefits

$

36,547

 

 

$

34,996

 

 

4.4

%

 

$

148,571

 

 

$

138,484

 

 

7.3

%

Carelon2,4

 

12,401

 

 

 

10,865

 

 

14.1

%

 

 

47,982

 

 

 

41,386

 

 

15.9

%

Corporate & Other4

 

181

 

 

 

58

 

 

212.1

%

 

 

479

 

 

 

399

 

 

20.1

%

Eliminations4

 

(6,675

)

 

 

(6,252

)

 

6.8

%

 

 

(26,823

)

 

 

(24,609

)

 

9.0

%

Total Operating Revenue1

$

42,454

 

 

$

39,667

 

 

7.0

%

 

$

170,209

 

 

$

155,660

 

 

9.3

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating Gain (Loss)

 

 

 

 

 

 

 

 

 

 

 

Health Benefits3,4

$

767

 

 

$

785

 

 

(2.3

)%

 

$

6,888

 

 

$

6,022

 

 

14.4

%

Carelon2,3,4

 

592

 

 

 

514

 

 

15.2

%

 

 

2,655

 

 

 

2,403

 

 

10.5

%

Corporate & Other1,3,4

 

(75

)

 

 

(40

)

 

NM5

 

 

(1,044

)

 

 

(142

)

 

NM5

Total Operating Gain1

$

1,284

 

 

$

1,259

 

 

2.0

%

 

$

8,499

 

 

$

8,283

 

 

2.6

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating Margin

 

 

 

 

 

 

 

 

 

 

 

Health Benefits

 

2.1

%

 

 

2.2

%

 

(10) bp

 

 

4.6

%

 

 

4.3

%

 

30 bp

Carelon

 

4.8

%

 

 

4.7

%

 

10 bp

 

 

5.5

%

 

 

5.8

%

 

(30) bp

Total Operating Margin1

 

3.0

%

 

 

3.2

%

 

(20) bp

 

 

5.0

%

 

 

5.3

%

 

(30) bp

1.

See "Basis of Presentation."

2.

Operating Revenue and Operating Gain for Carelon for the three months ended December 31, 2023 included $8,827 and $490 for CarelonRx; and $3,574 and $102 for Carelon Services, respectively. Operating Revenue and Operating Gain for Carelon for the three months ended December 31, 2022 included $7,523 and $475 for CarelonRx; and $3,342 and $39 for Carelon Services, respectively. Operating Revenue and Operating Gain for Carelon for the twelve months ended December 31, 2023 included $33,835 and $1,975 for CarelonRx; and $14,147 and $680 for Carelon Services, respectively. Operating Revenue and Operating Gain for Carelon for the twelve months ended December 31, 2022 included $28,526 and $1,868 for CarelonRx; and $12,860 and $535 for Carelon Services, respectively.

3.

Operating Gain for the three and twelve months ended December 31, 2023 and December 31, 2022 included items adjusted out of adjusted shareholders' net income. See "GAAP Reconciliation."

4.

Operating Revenue and Operating Gain for the three and twelve months ended December 31, 2022 are restated for the realignment of Carelon Global Solutions. For the three and twelve months ended December 31, 2022, $150 and $583 of Operating Revenue was realigned to Carelon Services, $160 and $618 of Operating Revenue was realigned away from the Corporate & Other segment, and $10 and $35 of Operating Revenue were realigned to Eliminations. For the three and twelve months ended December 31, 2022, $22 and $80 of Operating Gain was realigned to Carelon Services, $10 and $39 of Operating Gain was realigned away from the Health Benefits segment, and $12 and $41 of Operating Gain was realigned away from Corporate & Other. For the three months ended September 30, 2023, $135 of Operating Revenue was realigned to Carelon Services, $147 of Operating Revenue was realigned away from the Corporate & Other segment, and $12 of Operating Revenue were realigned to Eliminations. For the three months ended September 30, 2023, $19 of Operating Gain was realigned to Carelon Services, $13 of Operating Gain was realigned away from the Health Benefits segment, and $6 was realigned away from Corporate & Other.

5.

"NM" = calculation not meaningful.

Elevance Health

Reconciliation of Medical Claims Payable

 

 

Years Ended December 31

 

 

2023

 

 

 

2022

 

 

 

2021

 

(In millions)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

Gross medical claims payable, beginning of year

$

15,348

 

 

$

13,282

 

 

$

11,135

 

Ceded medical claims payable, beginning of year

 

(6

)

 

 

(21

)

 

 

(46

)

Net medical claims payable, beginning of year

 

15,342

 

 

 

13,261

 

 

 

11,089

 

 

 

 

 

 

 

Business combinations and purchase adjustments

 

?

 

 

 

133

 

 

 

420

 

 

 

 

 

 

 

Net incurred medical claims:

 

 

 

 

 

Current year

 

121,798

 

 

 

113,414

 

 

 

100,440

 

Prior years redundancies1

 

(1,571

)

 

 

(869

)

 

 

(1,703

)

Total net incurred medical claims

 

120,227

 

 

 

112,545

 

 

 

98,737

 

 

 

 

 

 

 

Net payments attributable to:

 

 

 

 

 

Current year medical claims

 

107,146

 

 

 

98,997

 

 

 

88,156

 

Prior years medical claims

 

12,565

 

 

 

11,600

 

 

 

8,829

 

Total net payments

 

119,711

 

 

 

110,597

 

 

 

96,985

 

 

 

 

 

 

 

Net medical claims payable, end of year

 

15,858

 

 

 

15,342

 

 

 

13,261

 

Ceded medical claims payable, end of year

 

7

 

 

 

6

 

 

 

21

 

Gross medical claims payable, end of year2

$

15,865

 

 

$

15,348

 

 

$

13,282

 

 

 

 

 

 

 

Current year medical claims paid as a percentage of current year net incurred medical claims

 

88.0

%

 

 

87.3

%

 

 

87.8

%

 

 

 

 

 

 

Prior year redundancies in the current year as a percentage of prior year net medical claims payable less prior year redundancies in the current year

 

11.4

%

 

 

7.0

%

 

 

18.1

%

 

 

 

 

 

 

Prior year redundancies in the current year as a percentage of prior year net incurred medical claims

 

1.4

%

 

 

0.9

%

 

 

2.2

%

 

 

 

  1. Negative amounts reported for net incurred medical claims related to prior years result from claims being settled for amounts less than originally estimated.
  2. Excludes insurance lines other than short duration.

Elevance Health

GAAP Reconciliation

(Unaudited)

This document references non-GAAP measures, including "Adjusted Shareholders' Net Income," "Adjusted Shareholders' Net Income Per Share," "Adjusted EPS", "Adjusted Operating Gain", "Adjusted Operating Expense" and "Adjusted Operating Expense Ratio", which are non-GAAP measures. These non-GAAP measures are intended to aid investors when comparing Elevance Health's financial results among periods and are not intended to be alternatives to any measure calculated in accordance with GAAP. Reconciliations of these non-GAAP measures to the most directly comparable measures calculated in accordance with GAAP are available below. In addition to these non-GAAP measures, references are made to the measures "Operating Revenue" and "Operating Gain/Loss," "Operating Margin" and "Adjusted EPS". Operating revenue and operating gain/loss are the key measures used by management to evaluate performance in each of its reporting segments, allocate resources, set incentive compensation targets and to forecast future operating performance. Operating gain/loss is calculated as total operating revenue less benefit expense, cost of products sold and operating expense. It does not include net investment income, net gains/losses on financial instruments, interest expense, amortization of other intangible assets and gains/losses on extinguishment of debt or income taxes, as these items are managed in a corporate shared service environment and are not the responsibility of operating segment management. Each of these measures is provided to further aid investors in understanding and analyzing Elevance Health's operating and financial results. A reconciliation of Operating Revenue to Total Revenue is set forth in the Consolidated Statements of Income herein. A reconciliation of the non-GAAP measures to the most directly comparable measures calculated in accordance with GAAP, together with a reconciliation of reportable segments operating gain to income before income tax expense, is reported below. Prior amounts may be grouped differently to conform to current presentation.Net adjustment items per share may not sum due to rounding. A reconciliation of Operating Revenue to Total Revenue is set forth in the Consolidated Statements of Income herein.

 

Three Months Ended
December 31

 

 

 

Twelve Months Ended
December 31

 

 

(In millions, except per share data)

 

2023

 

 

 

2022

 

 

Change

 

 

2023

 

 

 

2022

 

 

Change

Shareholders' net income - As reported

$

856

 

 

$

949

 

 

(9.8

)%

 

$

5,987

 

 

$

6,025

 

 

(0.6

)%

Impact of Accounting Standards Update 2018-12 Adoption

 

?

 

 

 

(84

)

 

 

 

 

?

 

 

 

(131

)

 

 

Shareholders' net income - Restated

$

856

 

 

$

865

 

 

(1.0

)%

 

$

5,987

 

 

$

5,894

 

 

1.6

%

Add / (Subtract):

 

 

 

 

 

 

 

 

 

 

 

Net losses on financial instruments

 

336

 

 

 

111

 

 

 

 

 

694

 

 

 

550

 

 

 

Amortization of other intangible assets

 

217

 

 

 

247

 

 

 

 

 

885

 

 

 

767

 

 

 

Transaction and integration related costs

 

59

 

 

 

36

 

 

 

 

 

213

 

 

 

72

 

 

 

Business optimization charges

 

22

 

 

 

39

 

 

 

 

 

719

 

 

 

39

 

 

 

Litigation expenses

 

1

 

 

 

1

 

 

 

 

 

6

 

 

 

12

 

 

 

BCBSA litigation settlement

 

(8

)

 

 

(20

)

 

 

 

 

(8

)

 

 

(44

)

 

 

Tax impact of non-GAAP adjustments

 

(158

)

 

 

(102

)

 

 

 

 

(628

)

 

 

(363

)

 

 

Net adjustment items

 

469

 

 

 

312

 

 

 

 

 

1,881

 

 

 

1,033

 

 

 

Adjusted shareholders' net income

$

1,325

 

 

$

1,177

 

 

12.6

%

 

$

7,868

 

 

$

6,927

 

 

13.6

%

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders' earnings per diluted share - As reported

$

3.63

 

 

$

3.93

 

 

(7.6

)%

 

$

25.22

 

 

$

24.81

 

 

1.7

%

Impact of Accounting Standards Update 2018-12 Adoption

 

?

 

 

 

(0.34

)

 

 

 

 

?

 

 

 

(0.53

)

 

 

Shareholders' earnings per diluted share - Restated

 

3.63

 

 

 

3.59

 

 

1.1

%

 

 

25.22

 

 

 

24.28

 

 

3.9

%

Add / (Subtract):

 

 

 

 

 

 

 

 

 

 

 

Net losses on financial instruments

 

1.42

 

 

 

0.46

 

 

 

 

 

2.92

 

 

 

2.27

 

 

 

Amortization of other intangible assets

 

0.92

 

 

 

1.02

 

 

 

 

 

3.73

 

 

 

3.16

 

 

 

Transaction and integration related costs

 

0.25

 

 

 

0.15

 

 

 

 

 

0.90

 

 

 

0.30

 

 

 

Business optimization charges

 

0.09

 

 

 

0.16

 

 

 

 

 

3.03

 

 

 

0.16

 

 

 

Litigation expenses

 

?

 

 

 

?

 

 

 

 

 

0.03

 

 

 

0.05

 

 

 

BCBSA litigation settlement

 

(0.03

)

 

 

(0.08

)

 

 

 

 

(0.03

)

 

 

(0.18

)

 

 

Tax impact of non-GAAP adjustments

 

(0.67

)

 

 

(0.42

)

 

 

 

 

(2.65

)

 

 

(1.50

)

 

 

Net adjustment items

 

1.99

 

 

 

1.29

 

 

 

 

 

7.92

 

 

 

4.25

 

 

 

Adjusted shareholders' earnings per diluted share

$

5.62

 

 

$

4.88

 

 

15.2

%

 

$

33.14

 

 

$

28.53

 

 

16.2

%

 

 

 

 

 

 

 

 

 

 

 

 

Elevance Health

GAAP Reconciliation

(Unaudited)

 

Three Months Ended
December 31

 

 

 

Twelve Months Ended
December 31

 

 

(In millions)

 

2023

 

 

 

2022

 

 

Change

 

 

2023

 

 

 

2022

 

 

Change

Operating expense - As reported

$

4,999

 

 

$

4,562

 

 

9.6

%

 

$

20,087

 

 

$

17,686

 

 

13.6

%

Impact of Accounting Standards Update 2018-12 Adoption

 

?

 

 

 

5

 

 

 

 

 

?

 

 

 

14

 

 

 

Operating expense - Restated

$

4,999

 

 

$

4,567

 

 

9.5

%

 

$

20,087

 

 

$

17,700

 

 

13.5

%

Add / (Subtract):

 

 

 

 

 

 

 

 

 

 

 

Transaction and integration related costs

 

(59

)

 

 

(36

)

 

 

 

 

(213

)

 

 

(72

)

 

 

Business optimization charges

 

(22

)

 

 

(39

)

 

 

 

 

(719

)

 

 

(39

)

 

 

Litigation expenses

 

(1

)

 

 

(1

)

 

 

 

 

(6

)

 

 

(12

)

 

 

BCBSA litigation settlement

 

8

 

 

 

20

 

 

 

 

 

8

 

 

 

44

 

 

 

Net adjustment items

 

(74

)

 

 

(56

)

 

 

 

 

(930

)

 

 

(79

)

 

 

Adjusted operating expense

$

4,925

 

 

$

4,511

 

 

9.2

%

 

$

19,157

 

 

$

17,621

 

 

8.7

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating revenue

$

42,454

 

 

$

39,667

 

 

7.0

%

 

$

170,209

 

 

$

155,660

 

 

9.3

%

 

 

 

 

 

 

 

 

 

 

 

Operating expense ratio

 

11.8

%

 

 

11.5

%

 

30 bp

 

 

11.8

%

 

 

11.4

%

 

40 bp

Adjusted operating expense ratio

 

11.6

%

 

 

11.4

%

 

20 bp

 

 

11.3

%

 

 

11.3

%

 

? bp

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended
December 31

 

 

 

Twelve Months Ended
December 31

 

 

(In millions)

 

2023

 

 

 

2022

 

 

Change

 

 

2023

 

 

 

2022

 

 

Change

 

 

 

 

 

 

 

 

 

 

 

 

Income before income tax expense

$

1,001

 

 

$

1,045

 

 

(4.2

)%

 

$

7,715

 

 

$

7,600

 

 

1.5

%

Net investment income

 

(529

)

 

 

(373

)

 

 

 

 

(1,825

)

 

 

(1,485

)

 

 

Net losses on financial instruments

 

336

 

 

 

111

 

 

 

 

 

694

 

 

 

550

 

 

 

Interest expense

 

259

 

 

 

229

 

 

 

 

 

1,030

 

 

 

851

 

 

 

Amortization of other intangible assets

 

217

 

 

 

247

 

 

 

 

 

885

 

 

 

767

 

 

 

Reportable segments operating gain

$

1,284

 

 

$

1,259

 

 

2.0

%

 

$

8,499

 

 

$

8,283

 

 

2.6

%

Adjustment items

 

74

 

 

 

56

 

 

 

 

 

930

 

 

 

79

 

 

 

Reportable segments adjusted operating gain

$

1,358

 

 

$

1,315

 

 

3.3

%

 

$

9,429

 

 

$

8,362

 

 

12.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Full Year 2024 Outlook

 

 

 

 

 

 

 

 

Shareholders' earnings per diluted share

Greater than $34.29

 

 

 

 

 

 

 

 

Add / (Subtract):

 

 

 

 

 

 

 

 

 

Amortization of other intangibles

$

1.93

 

 

 

 

 

 

 

 

 

Net losses on financial instruments

$

1.35

 

 

 

 

 

 

 

 

 

Transaction and integration related costs

$

0.31

 

 

 

 

 

 

 

 

 

Litigation expenses

$

0.03

 

 

 

 

 

 

 

 

 

Tax impact of non-GAAP adjustments

Approximately $(0.81)

 

 

 

 

 

 

 

 

Net adjustment items

$

2.81

 

 

 

 

 

 

 

 

 

Adjusted shareholders' earnings per diluted share

Greater Than $37.10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Elevance Health

Financial Guidance Summary

(Unaudited)

 

 

 

 

 

 

 

Full Year 2023 Actual

 

Full Year 2024 Outlook

Year-End Medical Enrollment (in millions)

 

 

 

 

Fee-Based

 

27.1

 

27.4 - 27.6

Risk-Based

 

19.9

 

18.4 - 19.0

Total

 

47.0

 

45.8 - 46.6

 

 

 

 

 

Premium Revenue

 

$142.9 billion

 

Approximately flat

Product Revenue

 

$19.5 billion

 

Mid-single digit growth

Service Fees

 

$7.9 billion

 

Low double-digit growth

Total Operating Revenue

 

$170.2 billion

 

Flat to low-single digit growth

 

 

 

 

 

Benefit Expense Ratio

 

87.0%

 

87.0% +/- 50 bps

Adjusted Operating Expense Ratio

 

11.3%

 

11.1% +/- 50 bps

Adjusted Operating Gain

 

$9.4 billion

 

Greater than $10.3 billion

 

 

 

 

 

Other Pre-Tax Items:

 

 

 

 

Net Investment income

 

$1,825 million

 

$1,900 million

Interest Expense

 

($1,030) million

 

($1,100) million

Amortization of Intangible Assets

 

($885) million

 

($450) million

Net Pre-Tax Expense

 

($90) million

 

$350 million

 

 

 

 

 

Adjusted Effective Tax Rate

 

23.0%

 

22.0% - 24.0%

GAAP Diluted EPS

 

$25.22

 

Greater than $34.29

Adjusted Diluted EPS

 

$33.14

 

Greater than $37.10

Diluted Shares

 

237.4 million

 

233 - 234 million

Operating Cash Flow

 

$8.1 billion

 

Greater than $8.1 billion

 

 

 

 

 

Segment Level Guidance Metrics

 

 

 

 

Operating Revenue Growth Rate

 

 

 

 

Health Benefits

 

$148.6 billion

 

Approximately flat

CarelonRx

 

$33.8 billion

 

Low-single digit

Carelon Services

 

$14.1 billion

 

High-teens to low-twenties

Operating Margin vs. 2023

 

 

 

 

Health Benefits

 

4.6%

 

25 - 50 bps

CarelonRx

 

5.8%

 

40 - 60 bps

Carelon Services

 

4.8%

 

(30) - 0 bps

Forward-Looking Statements

This document contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect our views about future events and financial performance and are generally not historical facts. Words such as "expect," "feel," "believe," "will," "may," "should," "anticipate," "intend," "estimate," "project," "forecast," "plan" and similar expressions are intended to identify forward-looking statements. These statements include, but are not limited to: financial projections and estimates and their underlying assumptions; statements regarding plans, objectives and expectations with respect to future operations, products and services; and statements regarding future performance. Such statements are subject to certain risks and uncertainties, many of which are difficult to predict and generally beyond our control, that could cause actual results to differ materially from those expressed in, or implied or projected by, the forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof. You are also urged to carefully review and consider the various risks and other disclosures discussed in our reports filed with the U.S. Securities and Exchange Commission from time to time, which attempt to advise interested parties of the factors that affect our business. Except to the extent required by law, we do not update or revise any forward-looking statements to reflect events or circumstances occurring after the date hereof. These risks and uncertainties include, but are not limited to: trends in healthcare costs and utilization rates; reduced enrollment; our ability to secure and implement sufficient premium rates; the impact of large scale medical emergencies, such as public health epidemics and pandemics, including COVID-19, and other catastrophes; the impact of new or changes in existing federal, state and international laws or regulations, including laws and regulations impacting healthcare, insurance, pharmacy services and other diversified products and services, or their enforcement or application; the impact of cyber-attacks or other privacy or data security incidents or breaches or our failure to comply with any privacy, data or security laws or regulations, including any investigations, claims or litigation related thereto; information technology disruptions; changes in economic and market conditions, as well as regulations that may negatively affect our liquidity and investment portfolios; competitive pressures and our ability to adapt to changes in the industry and develop and implement strategic growth opportunities; risks and uncertainties regarding Medicare and Medicaid programs, including those related to non-compliance with the complex regulations imposed thereon; our ability to maintain and achieve improvement in Centers for Medicare and Medicaid Services Star ratings and other quality scores and funding risks with respect to revenue received from participation therein; a negative change in our healthcare product mix; costs and other liabilities associated with litigation, government investigations, audits or reviews; our ability to contract with providers on cost-effective and competitive terms; failure to effectively maintain and modernize our information systems; risks associated with providing healthcare, pharmacy and other diversified products and services, including medical malpractice or professional liability claims and non-compliance by any party with the pharmacy services agreement between us and CaremarkPCS Health, L.L.C.; risks associated with mergers, acquisitions, joint ventures and strategic alliances; possible impairment of the value of our intangible assets if future results do not adequately support goodwill and other intangible assets; possible restrictions in the payment of dividends from our subsidiaries and increases in required minimum levels of capital; our ability to repurchase shares of our common stock and pay dividends on our common stock due to the adequacy of our cash flow and earnings and other considerations; the potential negative effect from our substantial amount of outstanding indebtedness and the risk that increased interest rates or market volatility could impact our access to or further increase the cost of financing; a downgrade in our financial strength ratings; the effects of any negative publicity related to the health benefits industry in general or us in particular; events that may negatively affect our licenses with the Blue Cross and Blue Shield Association; intense competition to attract and retain employees; risks associated with our international operations; and various laws and provisions in our governing documents that may prevent or discourage takeovers and business combinations.


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The American Lung Association's new "State of the Air" report reveals that spikes in deadly particle pollution are the most severe they've been in the history of the report. According to the new report, people in the U.S. experienced the most days...

23 avr 2024
(SYDNEY, April 24, 2024) - Champion Iron Limited ("Champion" or the "Company") reports production...

23 avr 2024
The Schall Law Firm, a national shareholder rights litigation firm, reminds investors of a class action lawsuit against Nextdoor Holdings, Inc. f/k/a Khosla Ventures Acquisition Co. II ("Nextdoor" or "the Company") for violations...

23 avr 2024
Escalade, Inc. , a leading manufacturer and distributor of sporting goods and indoor/outdoor recreational equipment, today announced that it will issue first quarter 2024 results before the market opens on Thursday, April 25, 2024. A conference call...

23 avr 2024
Great Neck Realty Co. is marketing the intellectual property (the "Assets") of BOA Nutrition, Inc., ("Company" or "BOA"), an innovative sports nutrition and wellness company that specialized in producing oral aerosol energy supplements tailored to...

23 avr 2024
West Fraser Timber Co. Ltd. ("West Fraser" or the "Company") reported today the first quarter results of 2024 ("Q1-24"). All dollar amounts in this news release are expressed in U.S. dollars unless noted otherwise.  First Quarter Highlights?  Sales...



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