Q3 2026 results
| Metric | Result | Change |
|---|---|---|
| Full year adjusted EPS outlook | At least $9.50 | Increased from at least $9 |
| Medicaid membership growth | 104,000 members | Not stated |
| CenterWell Primary Care membership growth | Nearly 147,000 members | 30% growth |
| Member weighted Star rating (BY '28) | 4.17 | Not stated |
Guidance and outlook
- We expect Part D to increase 14% to 15%.
- Overall, we expect an 8% to 9% core trend versus our range of 7% to 8% trend for this year.
- We expect to maintain top quartile results for BY '29.
How management sounded
Positive (+6 on our -10 to +10 scale). Management repeatedly emphasized that execution is ahead of plan, raised full-year guidance, and highlighted strong Stars performance. Management sounded more upbeat than on 8% of the 190 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Q&A summary
2027 Margin Outlook
Asked: Analysts asked about headwinds and tailwinds for 2027.
Answer: Management noted no incremental headwinds beyond the Stars headwind and expects tailwinds from business transformation, Medicaid and PCO J-curves, and improved product pricing.
Cost Trends
Asked: Analysts asked about cost trends and the PCO pressure.
Answer: Management noted inpatient costs are performing better than expected, while Part D trends are increasing, and they have taken steps to address specific geographic pressure in PCO.
Stars Strategy
Asked: Analysts asked about the shift to managing toward a top-quartile Stars target.
Answer: Management explained this is a disciplined approach to ensure cost and benefit structures are sustainable, rather than relying on top-decile performance.
Capital Allocation
Asked: Analysts asked about future M&A and share repurchases.
Answer: Management stated their primary capital use is funding insurance reserves, followed by Medicaid and CenterWell growth, and they plan to grow dividends and offset dilution with buybacks.
What to watch before the next call
- The December 10 investor update, where management will provide a detailed update on the multiyear transformation and market-to-market Investor Day commitments.
- The final quantification of the 2028 Stars tailwind and the specific split between reinvestment and shareholder returns.
- The outcome of the 2027 AEP and final membership retention data.
