01—Abstract
Summary
Summary of the 10-Q filed October 21, 2026. Cited figures are marked; the original filing is the authoritative source.
Elevance Health, Inc. reported solid financial results for the nine months ended September 30, 2026.
Total revenues saw a modest increase of 1.8% year-over-year, reaching $152.08 billiona. While net income for the nine-month period decreased by 10.9% to $4.56 billion, this was largely influenced by a significant loss contingency accrual related to Medicare Advantage risk adjustment data resubmission and a decrease in operating gain within the Health Benefits segment. Despite these headwinds, the company demonstrated operational resilience, with key segments like CarelonRx and Carelon Services showing revenue growth.
The company also maintained a strong cash flow from operations, which increased significantly to $7.51 billionb for the nine months ended September 30, 2026. Shareholders' diluted earnings per share for the nine-month period decreased by 7.3% to $21.01. However, the quarter-over-quarter performance showed a more positive trend, with shareholders' net income increasing by 14.8% and diluted EPS rising by 17.9%.
The company's balance sheet remains robust, with total assets growing to $127.8 billionc. Elevance Health continues to actively manage its capital, evidenced by its ongoing stock repurchase program and consistent dividend payments. The company also successfully navigated regulatory matters, including the closure of an enforcement process with CMS related to Medicare Advantage risk adjustment data.
02—Key points
Key Highlights
- Total revenues increased by 1.8% to $152.08 billion for the nine months ended September 30, 2026.
- Shareholders' net income for the nine months decreased by 10.9% to $4.56 billion, primarily due to a loss contingency accrual and a decrease in operating gain in the Health Benefits segment.
- Net cash provided by operating activities significantly increased by 78.6% to $7.51 billion for the nine months ended September 30, 2026.
- Diluted earnings per share decreased by 7.3% to $21.01 for the nine months ended September 30, 2026, but saw a strong increase of 17.9% ($6.27) for the three months ended September 30, 2026.
- Medical membership saw a slight overall decline of 1.1% to 44.88 million members, primarily driven by Medicaid redeterminations and decreases in Medicare Advantage and Commercial Risk-Based businesses.
- The company successfully resolved a CMS enforcement process regarding Medicare Advantage risk adjustment data, avoiding sanctions.
- Investments in equity securities increased substantially, from $740 million at December 31, 2025, to $2.15 billion at September 30, 2026.
03—Questions
Frequently Asked Questions
What was the primary driver for the decrease in net income for the nine months ended September 30, 2026?
The decrease in net income for the nine months ended September 30, 2026, compared to the prior year, was primarily driven by a loss contingency accrual for the estimated exposure related to the resubmission of certain Medicare Advantage risk adjustment data, and a decrease in the operating gain within the Health Benefits segment. These factors were partially offset by an increase in investment income and a decrease in net losses on financial instruments.
How did the company's medical membership perform during the period?
Total medical membership saw a slight decline of 1.1% to 44.88 million members as of September 30, 2026, compared to the prior year. This decline was mainly attributed to attrition in Medicaid membership due to eligibility redeterminations, along with decreases in Medicare Advantage and Commercial Risk-Based businesses. This was partially offset by growth in the Commercial Fee-Based business.
What is the company's outlook on cash flow and liquidity?
The company reported a strong increase in operating cash flow, which rose to $7.51 billion for the nine months ended September 30, 2026. This robust cash generation, combined with existing cash reserves and available credit facilities, leads the company to believe its liquidity and capital resources are adequate to fund its expected cash disbursements over the next twelve months and for future operations and strategic initiatives.
What were the key segment performances?
The Health Benefits segment experienced revenue growth but a decrease in operating gain due to higher medical costs and operating expenses. CarelonRx showed revenue growth driven by higher average revenue per prescription and improved operating gain due to specialty pharmacy profitability. Carelon Services also saw revenue and operating gain increases, driven by expansion in specialty and home-based care services. Corporate & Other reported decreased operating revenue and an increased operating loss, primarily due to lower affiliate revenues and the Medicare Advantage risk adjustment accrual.
04—Continue