Elevance Health, Inc. Annual Report, Year Ended Dec 31, 2010

Elevance Health, Inc. (ELV), formerly WellPoint, Inc., reported for the year ended December 31, 2010, total operating revenue of $57.8 billion, a decrease of 5% from the previous year. This decline was attributed to factors such as unfavorable economic conditions leading to membership declines in certain segments, the conversion of some fully-insured accounts to self-funded status, and the sale of its pharmacy benefits management (PBM) business. Net income for 2010 was $2.9 billion, a significant decrease of 39% from 2009, largely due to the absence of a substantial gain on the PBM sale in the prior year and higher operating results in some segments being offset by increased costs. The company experienced a net decrease in medical membership of 347,000 members, bringing the total to 33.3 million. Despite the overall membership decline, the company saw growth in its National Accounts, FEP, Senior, and State-Sponsored segments. The shift towards self-funded plans continued, with a 7% increase in self-funded membership, while fully-insured membership decreased by 11%. The company continued its significant share repurchase program, returning substantial capital to shareholders. Investors should note the ongoing impact of healthcare reform legislation, such as the Patient Protection and Affordable Care Act (PPACA), which is expected to significantly shape the future operating landscape and regulatory environment for the company.