Though it's still early days, Elevance Health is seeing signs that members are shifting from Medicaid to plans on the Affordable Care Act's exchanges as redeterminations continue, executives said Wednesday.
CEO Gail Boudreaux told investors on the company's earnings call that while "transitions of coverage are not typically immediate," the data does suggest that these enrollment shifts are occurring. States and Medicaid managed care plans are currently sifting through a years-long backlog of Medicaid eligibility determinations, which were paused during the COVID-19 public health emergency.
Most states expect that these decisions will take a year or more to complete. In its earnings report, Elevance said Medicaid membership in the second quarter decreased by 135,000 people as eligibility determinations resumed.
Boudreaux said that the insurer has contacted 1.5 million Medicaid members to date about the redetermination process, and that it's seen "healthy utilization" of its online coverage decision support tools. This digital option assesses the member's eligibility for multiple insurance programs as well as other assistance options like the Supplemental Nutrition Assistance Program.
Members that connect to the tool can input key information and be connected directly to the sites where they can sign up for coverage or other programs. Boudreaux said that more than half of people who were potentially eligible for ACA plans have clicked through to sign up, as did 60% of people eligible to renew their Medicaid coverage.
"This body of work is especially important as many of the people who have lost access to Medicaid so far are losing it for administrative reasons," she said.
Boudreaux added that the insurer expects that many of these consumers will come to re-enroll in Medicaid coverage.
The insurer posted double-digit profit growth in the second quarter, with its earnings rising by 13.2% year over year to $1.9 billion.
The company reported $1.6 billion in the prior year quarter, according to its earnings report released Wednesday morning. Revenues also grew by double digits, increasing by 13% to $43.7 billion in the second quarter from $38.6 billion in the second quarter of 2022. The results both surpassed Wall Street's expectations, according to Zacks Investment Research.
The Blues insurance giant reported similar results for its midyear earnings and revenue, according to the report. Through the first six months of 2023, Elevance Health brought in $3.8 billion, up 12.1% from the $3.4 billion it earned in the first half of 2022. Midyear revenues were up by 11.9%, reaching $85.8 billion compared to $76.7 billion in the first half of 2022.
“Our solid execution and continued progress of our strategy to become a lifetime trusted health partner resulted in strong second quarter and first half results,” Boudreaux said in the release. “Our focused efforts to optimize our mature businesses, invest in high-growth opportunities, and accelerate our growth through Carelon to meet the whole health needs of consumers positions us well for the rest of 2023 and beyond.”
As it has continued focus on building out its Carelon segment, Elevance Health has begun reporting its performance and the financial results for its core insurance business separately. The health benefits unit accounted for $38 billion in operating revenue, while Carelon brought in $11.9 billion in operating revenue, according to the report.
Membership across Elevance Health's plans was about 48 million as of June 30, up by 938,000 people compared to midyear 2022. The company said this was backed largely by growth in Medicaid, Medicare Advantage, Affordable Care Act exchange plans and BlueCard coverage.
Thanks to strong performance in the first half and "momentum" it's feeling heading into the latter parts of 2023, Elevance Health said it now expects earnings for the full year of at least $32.85 per share.