Elevance Health reports fourth quarter and full-year 2023 results; sets full-year 2024 outlook

Elevance Health reports fourth quarter and full-year 2023 results; sets full-year 2024 outlook

Indianapolis, Indiana – January 24, 2024 – Elevance Health, Inc. (NYSE: ELV) reported fourth quarter and full-year 2023 results.

“We are pleased to deliver another strong performance in 2023, driven 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 focus of our corporate strategy Execution supports our confidence in the prospects for 2024, and we will continue to optimize the foundation, expand the scale of the flywheel, and achieve long-term sustainable growth of the enterprise.”

Gayle K. Boudreau
President and CEO

*Diluted earnings per share (“EPS”)
**See GAAP Reconciliation.

Conglomerate Highlights

Operating income for the fourth quarter of 2023 was $42.5 billion, an increase of $2.8 billion, or 7%, from the fourth quarter of 2022. Operating income for 2023 was $170.2 billion, an increase of $14.5 billion, or 9%, from the fourth quarter of 2022. Growth for the quarter and year was driven by higher premium revenue from our Health Benefits segment and growth in CarelonRx pharmaceutical revenue.

The benefit expense rate in the fourth quarter was 89.2%, an increase of 50 basis points compared with the fourth quarter of 2022; the benefit expense rate for the full year was 87.0%, an increase of 60 basis points year-on-year. Improvements in the quarter and year were driven by trends in premium adjustments to cover medical costs. As of December 31, 2023, the number of days for compensation payable was 47.3 days, a decrease of 1.3 days from September 30, 2023, and a decrease of 0.2 days from December 31, 2022.

The operating expense rate for the fourth quarter and full year of 2023 was 11.8%, an increase of 30 basis points compared with the fourth quarter of 2022 and an increase of 40 basis points year-on-year. Growth in the quarter was driven by an acceleration of growth investments, and full-year growth was driven by business optimization charges recorded in 2023.

Cash flow and balance sheet

Operating cash flow in 2023 will be $8.1 billion, which is 1.3 times GAAP net income. As of December 31, 2023, the parent company’s total cash and investments were approximately $1.6 billion.

In the fourth quarter of 2023, the company repurchased 2 million shares of common stock for $929 million, with a weighted average price of $465.63. Throughout 2023, the company repurchased 5.8 million shares of common stock for $2.7 billion, at a weighted average price of $463.53. As of December 31, 2023, approximately $4.2 billion remained in the stock repurchase authorization approved by the company’s board of directors. In the fourth quarter of 2023, the company paid a quarterly dividend of $1.48 per share, equivalent to a total cash distribution of $346 million.

Reportable segment highlights

health benefits Includes individual, employer group risk-based, employer group fee-based, Blue Card, Medicare, Medicaid, and federal health products and services businesses.

Operating income for the fourth quarter of 2023 was $36.5 billion, an increase of $1.5 billion, or 4%, from the fourth quarter of 2022. Operating income for 2023 was $148.6 billion, an increase of $10.1 billion, or 7%, from the fourth quarter of 2022. This increase was primarily due to higher premium income from our commercial health benefits business.

Operating income for the fourth quarter of 2023 totaled $767 million, down 2% from the fourth quarter of 2022. This was primarily driven by investments made during the quarter to support long-term growth. Operating income in 2023 totaled $6.9 billion, an increase of $866 million, or 14%, year over year. This is primarily due to premium adjustments to reflect health care cost trends.

As of December 31, 2023, the total number of medical members was approximately 47 million, a year-on-year decrease of 570,000, or 1%. This is due to a reduction in our Medicaid business due to resumption of eligibility redeterminations in the second quarter of 2023, as well as a decline in risk-based business in the employer group. These membership losses were partially offset by growth in BlueCard, Affordable Care Act health plans and Medicare Advantage.

Medical membership decreased by 364,000 in the fourth quarter of 2023 due to redetermination-related Medicaid membership losses, partially offset by growth in commercial fee membership.

careron Composed of CarelonRx and Carelon Services.

Carelon segment operating income was $12.4 billion in the fourth quarter of 2023, an increase of $1.5 billion, or 14%, from the fourth quarter of 2022. Operating income for 2023 was $48 billion, an increase of $6.6 billion, or 16%, from the fourth quarter of 2022. Growth in the quarter and year was driven by growth in CarelonRx pharmaceutical product revenue, related to growth in outside pharmacy members served and the BioPlus Specialty Pharmacy acquisition.

Carelon segment operating income was $592 million in the fourth quarter of 2023, an increase of $78 million, or 15%, compared to the fourth quarter of 2022. The increase in the quarter was primarily due to improved performance in our Carelon Services business. Operating income in 2023 will be $2.7 billion, an increase of $252 million, or 10%, year-over-year. Full-year growth was primarily driven by increases in CarelonRx prescription volume, growth in the number of outside pharmacy members served, the acquisition of BioPlus Specialty Pharmacy, improved performance in our Carelon Services business and the continued expansion of our late-line services. Acute care management business.

About Elevance Health, Inc.

Elevance Health is a trusted, lifelong health partner dedicated to improving human health. The company supports consumers, families and communities throughout the care continuum – connecting them with the care, support and resources they need to live healthier lives. Elevance Health companies serve more than 115 million people through a diverse portfolio of industry-leading medical, digital, pharmaceutical, behavioral, clinical and complex care solutions.For more information, visit www.elevancehealth.com or follow us @ElevanceHealth Elevance Health on Twitter and LinkedIn.

Conference calls and webcasts

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 prospects. The conference call should be accessed at least 15 minutes before the start of the call using the following number:

  • 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. Replay will begin today at 11:30 AM ET and will end on February 23, 2024. The conference call can also be viewed via a live webcast: www.elevancehealth.com Under the “Investors” link. A webcast replay will be available following the conference call.

Presentation basics

1. Operating income and operating profit and loss are key indicators for management to evaluate the performance of each reporting segment, allocate resources, set incentive compensation targets, and predict future operating performance. Operating income/loss is calculated as total operating income less benefit expense, cost of products sold and operating expenses. It does not include net investment income, net gains/losses on financial instruments, interest expense, amortization of other intangible assets, debt extinguishment gains/losses, or income taxes because these items are managed in an enterprise shared services environment and are not included . Responsibilities of Operating Segment Management. See GAAP Reconciliation Table.

2. Operating profit margin is defined as operating profit divided by operating revenue.

Elevance Health Contact

Investor Relations:
Stephen Tanner
[email protected]

Media contact information:
Leslie Porras
[email protected]

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