Company: ELV
Filing Date: 2025-07-17
Form Type: 10-Q
Source: 0001156039-25-000114
Chunk: 93

Company: Elevance Health, Inc.
Filing Date: 2025-07-17
Form: 10-Q
Item: Item 2
Chunk 93
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, and growth in our Medicare Advantage membership, partially offset by membership attrition in our Medicaid business.

Net investment income decreased primarily due to lower income from fixed maturity securities. 

Net losses on financial instruments increased due to higher losses on other invested assets partially offset by lower losses from fixed maturity securities sales.

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Benefit expense increased primarily due to higher medical cost trends across all lines of business within our Health Benefits segment, partially offset by a favorable out-of-period settlement from a value-based care provider.

Our benefit expense ratio increased primarily as a result of higher medical cost trend in our Medicaid business and Individual and Small Group ACA plans (“Affordable Care Act health plans”). 

Cost of products sold reflects the cost of pharmaceuticals dispensed by CarelonRx for our unaffiliated pharmacy customers. Cost of products sold increased as a result of higher script utilization.

Operating expense improved primarily due to disciplined cost management, partially offset by an increase in premium taxes and assessments. 

Our operating expense ratio decreased primarily due to operating expense leverage associated with growth in operating revenue. 

Other expense increased primarily due to higher interest expense related to our issuances of senior secured notes during the latter half of 2024. The increase also reflects higher amortization of intangible assets acquired in our fourth quarter of 2024 acquisitions.

Our effective tax rate increased primarily due to the non-recurrence of a favorable resolution of an uncertain tax position recognized during the three months period ended June 30, 2024.

Our shareholders’ net income as a percentage of total revenues decreased in the three months ended June 30, 2025 as compared to the three months ended June 30, 2024 as a result of all factors discussed above.

Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024 

Total operating revenue increased primarily as a result of premium rate increases in our Health Benefits segment in recognition of medical cost trends, recent acquisitions, and growth in our Medicare Advantage and Individual ACA membership, partially offset by membership attrition in our Medicaid business.

Net investment income increased primarily due to higher income from alternative investments, partially offset by lower income from fixed maturity securities.

Net losses on financial instruments increased due to higher losses on other invested assets partially offset by lower losses from fixed maturity securities sales.

Benefit expense increased primarily due to higher medical cost trends across all lines of business within our Health Benefits segment, partially offset by a favorable out-of-period settlement from a value-based care provider.

Our benefit expense ratio increased primarily as a