Health insurance shares moved sharply lower in premarket trading after Elevance Health's (NYSE:ELV) latest quarterly results revealed continued pressure on margins within its core Health Benefits business, raising concerns that similar challenges could affect the wider managed-care sector.
Although Elevance reported second-quarter earnings and revenue that comfortably exceeded ******* ysts' expectations, investors focused on the deterioration in profitability.
The company's adjusted operating margin declined to 3.6% from 5.0% a year earlier, sending Elevance shares down 6.7% in premarket trading.
The Health Benefits division, Elevance's largest business, recorded a sharp drop in operating profit as lower Medicaid reimbursement rates and ongoing changes to its Medicare Advantage portfolio weighed on margins.
The results triggered broad selling across the health insurance industry ahead of UnitedHealth Group's (NYSE:UNH) own quarterly earnings release.
Although Elevance reported second-quarter earnings and revenue that comfortably exceeded ******* ysts' expectations, investors focused on the deterioration in profitability.
The company's adjusted operating margin declined to 3.6% from 5.0% a year earlier, sending Elevance shares down 6.7% in premarket trading.
The Health Benefits division, Elevance's largest business, recorded a sharp drop in operating profit as lower Medicaid reimbursement rates and ongoing changes to its Medicare Advantage portfolio weighed on margins.
The results triggered broad selling across the health insurance industry ahead of UnitedHealth Group's (NYSE:UNH) own quarterly earnings release.
21 days ago
