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Indianapolis-based Elevance Health reported an uptick in both premiums and enrollments in the first quarter of 2023, the insurer reported in its earnings call last week.
The insurer’s operating revenue for Q1, ending on March 31, 2023, was $41.9 billion, a 10.6% increase from $37.9 billion for the same period in 2022. The insurer’s fiscal year runs from Jan. 1 to Dec. 31.
The results exceeded Wall Street’s expectations: 15 analysts surveyed by Zacks Investment Research anticipated that Elevance’s revenue would reach $40.9 billion. Medical enrollment also grew to about 48.1 million members this quarter, up from 46.8 million members in Q1 2022.
“Growth was driven by higher premium revenue in Medicaid and Medicare, premium rate increases to cover overall cost trends, and strong topline growth in CarelonRx and Carelon services,” Elevance EVP and CFO John Gallina said.
Other takeaways:
Elevance (formerly Anthem) will not cover drugs prescribed only for weight loss, including GLP-1 drugs such as Ozempic, which can be used to manage diabetes—except in states where it is required, Gallina said. Both the use and cost of these drugs is increasing, according to benefits consulting firm Segal. (Many insurers will not typically cover new weight-loss drugs, but may cover the same medication to treat diabetes, the New York Times reported.)
The company has protocols in place “so that [the GLP-1 drugs] are not utilized for purposes that are other than medical necessity for diabetes-type folks,” Gallina said.
Carelon, Elevance’s health services division, rolled out a Medicare-contracted post-acute care management program at its investor conference in March.
The program is “well underway and will contribute meaningfully to growth in 2023,” said Gail Boudreaux, president and CEO of Elevance.
Durable medical equipment and social determinants of health are some areas where the post-acute care program can drive outcomes, Carelon President Peter Haytaian said.
The insurer also closed its acquisition of specialty pharmacy BioPlus in February, and has since started construction on the first of three new dispensing facilities, according to Boudreaux.
These investments will support the insurer’s plans to expand BioPlus’ service model, which “covers more than 100 limited distribution medications and has a footprint that touches all 50 states,” across treatment areas of more complex diseases, according to a February press release.
Elevance plans to focus on growing its organization through Carelon in 2023, according to Gallina.