Elevance Health Reports Strong Q1 2026 Results and Raises Full-Year Guidance
Elevance Health reported first quarter 2026 financial results that exceeded expectations, reflecting strong operational performance, improving claims experience, and continued execution of strategic initiatives. The company also raised its full-year adjusted earnings outlook, signaling confidence in its business momentum and visibility for the remainder of the year.
Strong Start to 2026
Elevance Health began 2026 with solid financial results, underpinned by growth across key business segments and disciplined cost management. For the first quarter, the company reported operating revenue of $49.5 billion, representing an increase of 1.5% compared to the same period in 2025. This growth was primarily driven by higher premium yields in the Health Benefits segment and continued expansion of CarelonRx product offerings.
However, revenue growth was partially offset by anticipated declines in membership across certain lines of business, including Medicare Advantage, Medicaid, and Employer Group risk-based plans. These declines reflect the company’s strategic repositioning of its portfolio toward more sustainable and profitable segments.
Earnings Performance and Profitability
The company reported diluted earnings per share (EPS) of $8.00 for the quarter. On an adjusted basis, diluted EPS reached $12.58, supported by strong underlying operating results as well as approximately $1.00 per share of non-recurring investment income.
This strong earnings performance highlights Elevance Health’s ability to manage costs effectively while maintaining growth, even amid a dynamic healthcare environment.
Upgraded Full-Year Guidance
Based on its strong first-quarter performance and improved outlook for the rest of the year, Elevance Health updated its 2026 financial guidance:
- Full-year diluted EPS is now expected to be at least $19.85, including the estimated financial impact related to a regulatory matter involving the Centers for Medicare & Medicaid Services (CMS).
- Full-year adjusted diluted EPS guidance has been raised to at least $26.75, reflecting the strength of the company’s core business and improved visibility.
The upward revision in adjusted earnings guidance is supported by continued operational discipline, initiatives to reduce medical costs, and a clearer understanding of performance trends across its businesses.
Expense and Cost Trends
Elevance Health reported a benefit expense ratio of 86.8%, representing an increase of 40 basis points compared to the prior year. This increase was primarily driven by higher medical cost trends within the Medicaid business. However, improved performance in Medicare helped offset some of this pressure.
The operating expense ratio was 12.8%, which included a $935 million accrual related to a CMS notice concerning a potential regulatory exposure. Additionally, the company recorded a $129 million charge associated with business optimization initiatives aimed at streamlining operations and enhancing organizational efficiency.
On an adjusted basis, the operating expense ratio improved to 10.5%, reflecting disciplined expense management and efficiency gains. The company continues to invest strategically in clinical, operational, and administrative workflows to support long-term growth and improve overall performance.
Cash Flow and Financial Position
Elevance Health demonstrated strong cash generation in the first quarter. Operating cash flow totaled $4.3 billion, marking an increase of $3.3 billion year over year. This improvement was driven by strong operating performance and favorable working capital dynamics.
As of March 31, 2026, the company reported approximately $2.2 billion in cash and investments at the parent level, providing a solid liquidity position to support ongoing operations and strategic investments.
The company also reaffirmed its expectation for full-year 2026 operating cash flow of at least $5.5 billion, including potential cash payments related to the CMS matter.
Shareholder Returns
Elevance Health continued its commitment to delivering value to shareholders through both share repurchases and dividends.
During the first quarter of 2026, the company returned $1.5 billion of capital to shareholders, including:
- $1.1 billion in share repurchases, representing 3.7 million shares at an average price of $304.68
- $376 million in dividends, with a quarterly dividend of $1.72 per share
The company also reported approximately $5.6 billion remaining under its share repurchase authorization, indicating continued flexibility for future capital returns.
Health Benefits Segment
The Health Benefits segment remains the cornerstone of Elevance Health’s business, encompassing Individual, Employer Group, Medicare, Medicaid, and Federal Employee Program offerings.
- Operating revenue: $42.5 billion
- Growth: 2.6% year over year
Revenue growth was primarily driven by higher premium yields, although partially offset by declines in certain membership categories.
Operating gain for the segment was $2.2 billion, down 2.7% from the prior year, reflecting increased medical costs—particularly within Medicaid.
Medical membership totaled approximately 45.4 million, representing an increase of 186,000 members from year-end 2025. Growth in commercial fee-based membership was partially offset by declines in Medicare Advantage and Employer Group risk-based membership, consistent with the company’s strategic repositioning efforts.
Carelon Segment
The Carelon segment, which includes CarelonRx and Carelon Services, continues to be a key driver of growth and innovation for Elevance Health.
- Operating revenue: $18.0 billion
- Growth: 7.9% year over year
Growth in this segment was fueled by the expansion of Carelon Services’ risk-based solutions and increased product revenue from CarelonRx.
Operating gain totaled $1.1 billion, representing a decline of 3.8% compared to the prior year. This decrease was driven by lower health plan membership and continued investments in expanding risk-based capabilities.
However, improved profitability in specialty pharmacy and behavioral health services helped partially offset these impacts.
Claims and Operational Metrics
The company reported days in claims payable of 46.6 days as of March 31, 2026. This represents an increase of:
- 5.3 days from December 31, 2025
- 3.8 days year over year
The increase reflects higher claims volumes and timing-related factors, as well as ongoing adjustments in working capital management.
Dividend Announcement
Elevance Health also announced its second quarter 2026 dividend of $1.72 per share, continuing its consistent approach to shareholder returns.
- Payment date: June 25, 2026
- Record date: June 10, 2026
Leadership Commentary
Gail K. Boudreaux, President and CEO, emphasized that the company’s performance reflects both operational strength and strategic execution. She noted that improving claims experience, disciplined cost management, and enhanced visibility into future performance have positioned the company for continued success.
- Managing medical cost trends
- Driving operational efficiency
- Expanding care delivery capabilities
- Strengthening its diversified business model
The company’s raised guidance and reaffirmed cash flow expectations demonstrate confidence in its ability to navigate industry challenges while delivering sustainable growth.
About Elevance Health
Elevance Health is a lifetime, trusted health partner whose purpose is to improve the health of humanity. The company supports consumers, families, and communities across the entire healthcare journey – connecting them to the care, support, and resources they need to lead better lives. Elevance Health’s companies serve approximately 105 million consumers through a diverse portfolio of industry-leading medical, pharmacy, behavioral, clinical, home health, and complex care solutions
