Elevance Health, Inc.

Ladies and gentlemen, thank you for standing by and welcome to the Elevins Health first quarter earnings conference call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session where participants are encouraged to present a single question. If you wish to ask a question, please press star then one on your telephone keypad. You will hear a prompt that you have been queued. You may withdraw your question at any time by pressing star then two. These instructions will be repeated prior to the question and answer portion of this call. As a reminder, today's conference is being recorded. I would now like to turn the conference over to the company's management. Please go ahead.

Good morning and welcome to Elevance Health's first quarter 2026 earnings conference call. My name is Nathan Rich, vice president of investor relations. With us on the earnings call are Gail Boudreau, president and CEO. Mark Kay, our CFO. Felicia Norwood, our chief health benefits officer. Morgan Kendrick, president of our commercial health benefits business. and Amy Daly, president of our government health benefits business. Gail will open the call by highlighting our first quarter performance and the actions we are taking to advance our strategic priorities. Mark will then discuss our financial results and revised outlook in greater detail. After our prepared remarks, the team will be available for Q&A. During the call, we will reference certain non-GAAP financial measures. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are available on our website, ElevanceHealth.com. We will also be making forward-looking statements on this call. Listeners are cautioned that these statements are subject to certain risks and uncertainties, many of which are difficult to predict and generally beyond the control of Elevance Health. These risks and uncertainties may cause actual results to differ materially from our current expectations. we advise listeners to carefully review the risk factors discussed in today's press release and in our quarterly filings with the SEC. I will now turn the call over to Gail.

Good morning and thank you for joining us. Healthcare is undergoing significant transformation and it requires us to operate with greater speed, precision, and connectivity. Costs are rising, expectations are rising, and both member and care providers want a simpler, more integrated experience. At Elevance Health, our strategy remains clear. Lower the cost of healthcare and simplify how people navigate the system. What is evolving is how we execute. We are operating with greater alignment, accountability, and clarity across the enterprise. And that progress is showing up in our results. In the first quarter, our performance exceeded expectations, driven by underlying business strength, along with ACA seasonality and non-recurring investment income. While it is still early in the year, the trends we are seeing give us increased confidence in the trajectory of the business. That is why we are raising our full year adjusted diluted earnings per share guidance to at least $26.75. Our outlook remains grounded in prudent, achievable assumptions with clear visibility into the key drivers of performance supported by improving claims experience. We are advancing our strategy in several focused ways. First, we've realigned our leadership structure to strengthen coordination between health benefits and Carillon. We have streamlined accountability aligned core functions more closely to the business and brought decision-making closer to where the work is done. Those changes are designed to sharpen execution and create greater alignment across the enterprise. Second, we are embedding and scaling AI across clinical, operational, and administrative workflows where it can have direct measurable impact. and we are already seeing tangible results. These capabilities are improving how we engage members and how we manage costs. They are enabling earlier, more personalized interventions, strengthening decision-making through predictive analytics, and reducing administrative expense through automation. Together, these are driving greater efficiency and supporting more consistent performance over time. Third, We are transforming how care is delivered through carillon by advancing our integrated whole health approach. By combining care bridge and our care at home capabilities into a single risk based solution, we are driving higher engagement and stronger clinical outcomes. These programs have reduced hospital readmission by 20% and generated more than 10% savings on post acute care supported by integrated pharmacy, specialty care, and behavioral health. We continue to see strong demand for Caroline's capabilities, reinforcing its role as a driver of current performance and long-term growth. Let me turn to our first quarter performance. In Medicaid, we are seeing early evidence that our actions are lowering costs. particularly in behavioral health and specialty pharmacy. That progress is being driven by more targeted, proactive interventions that allow us to engage earlier, coordinate care more effectively, and support members in the most appropriate settings. We are addressing rapid growth in ABA therapy through rigorous clinical oversight and we're using predictive analytics to identify members at risk of substance use disorder before adverse events occur. In Medicare Advantage, the steps we have taken to reposition the business are driving improved performance, and we remain on track to achieve an operating margin of at least 2% in 2026. We were also encouraged to see CMS address a portion of the funding challenges in the final rates for 2027. As we prepare for bid submissions, we will remain disciplined and continue to prioritize plans that deliver long-term value while supporting progress toward our financial objectives. Regarding the notice we received from CMS in February related to historical risk adjustment data, We are engaging constructively with the agency and making steady progress toward resolution. We stand firmly behind the integrity of our risk adjustment program, supported by rigorous oversight and governance. Importantly, this matter does not affect our outlook or how we serve our members, and it does not change how we are managing the business or our expectations for performance. In commercial, we maintained a disciplined pricing approach for 2026 to ensure appropriate returns and our first quarter performance reflects that focus. As we look ahead to 2027 selling season, we are seeing strong employer interest supported by a robust pipeline and early wins. Our integrated medical and pharmacy capabilities continue to resonate in the market. In individual ACA, we are seeing modestly stronger retention, particularly in bronze tier plans where affordability remains critical. First quarter results reflect pronounced seasonality given product mix, and the business remains on track toward a more sustainable financial profile. In Carillon, our risk-based solutions are delivering measurable value. Using AI and advanced analytics, We are identifying high risk members earlier and engaging them through coordinated whole person care. That is driving higher medication adherence, fewer emergency room visits, and lower hospital readmissions. And it continues to support strong demand for our capabilities. In summary, we are executing our strategy with discipline and clarity. Our actions are translating into measurable results, improving affordability, simplifying the healthcare experience, and strengthening financial performance. We are building momentum, and we are seeing that translate into more consistent performance across our businesses with strong visibility into the drivers of our results. Elevance Health was recently named to Fortune's 100 Best Companies to Work For list. for the sixth consecutive year. We view that as a reflection of the strength of our culture and our people and an important foundation as we improve execution and build greater consistency in our results. As we look ahead, we remain confident in our ability to deliver at least 12% adjusted EPS growth in 2027. Before I close, I want to recognize and thank our associates. Their commitment, resilience, and sense of purpose drive our progress, supporting our members, partnering with care providers, and advancing our mission every day. With that, I will turn the call over to Mark to review our first quarter financial results and updated outlook.