Elevance Health said second quarter profits surpassed $2.3 billion thanks to strong sales of commercial health insurance and growth of healthcare services under the Carelon umbrella that offset the loss of Medicaid health plan members.
Elevance, which sells government and commercial health insurance including Blue Cross and Blue Shield plans in 14 states, Wednesday reported first quarter net income rose 24% to $2.3 billion compared to $1.85 billion in the year-ago quarter.
Total revenue rose less than 1% to $43.88 billion compared to $43.67 billion a year ago as growth in other health benefits businesses made up for most of the loss of nearly 3 million Medicaid members and the company’s Carelon health services business performed well.
Elevance’s membership tumbled by 5%, or 2.2 million to 45.8 million as of June 30, 2024 compared to a year-ago due largely to the end of a pandemic-era coverage provision that kept people covered by Medicaid.
The end of the U.S. Public Health Emergency in May of last year after three years of the COVID-19 pandemic is impacting health insurers that have a significant business administering Medicaid coverage for states, which are conducting so-called “Medicaid redeterminations.” Medicaid redetermination, also described as Medicaid renewal or Medicaid recertification, is essentially when people are asked to show they are qualified for such coverage.
In Elevance’s case, Medicaid enrollment dropped 23% to 9 million in the second quarter compared to a 11.7 million in the year-ago period due to what Elevance’s earnings report described as “attrition in our Medicaid business associated with eligibility redeterminations and expected footprint adjustments, primarily in the first quarter.”
Like other health insurers that manage Medicaid coverage in partnership with states, Elevance has seen a boom in buyers of individual coverage, also known as Obamacare, under the Affordable Care Act. That individual health plan membership jumped 35% to nearly 1.3 million compared to the year-ago period.
