Elevance Health, Inc. · NYSE:ELV
Elevance Health — Investor Day (March 2023)
63 slides from Elevance Health's investor day presentation, Mar 23, 2023
Slide 1: 2023 Investor Conference
Aw Elevance Health 2023 Investor Conference
Slide 2: Health Benefits Healthcare Services
Health Benefits Healthcare Services Integrated portfolio of whole Over 47.5M medical members health solutions connecting care creating the most balanced and across physical, behavioral, social, resilient portfolio in the industry and pharmacy needs 2
Slide 3: Health Benefits Brands Healthcare Services Brand
Health Benefits Brands Healthcare Services Brand 3
Slide 4: Delivering On Our Commitments
Delivering On Our Commitments Medical Consolidated Operating Adjusted Membership Growth* Revenue Growth* EPS Growth* >4% >14% >16% * Compound Annual Growth Rate for 2018-2022 4
Slide 5: Optimize Our Core, Invest in High Growth
Optimize Invest in High Our Core Growth Health Benefits Carelon Accelerate 5
Slide 6: Carelon
Aw Elevance Health Carelon
Slide 7: Analytics & Insights, Behavioral Health, Care Delivery, Pharmacy
Analytics & Behavioral Insights Health Care Delivery & Enablement Pharmacy 7
Slide 8: Carelon Services Strategy
Carelon Services Strategy Integrates physical, behavioral, social and pharmacy services to deliver whole health, affordably. Creates value by offering market-leading services to payers and taking risk, powered by analytics, delivered with empathy. 8
Slide 9: Total Membership
* US Medical Membership | Blues vs. Competitors > 110M Total Membership 47.5M 46.3M 24.4M 22.8M 16.2M 13.5M 5.3M All Blue ELV UNH CVS CNC CI HUM MOH Plans * Payers * Excludes Medicare Standalone Part D and other specialty membership 9
Slide 10: Carelon
Carelon Care Analytics & Providers Behavioral Health Insights Health Carelon Benefits Care Delivery Pharmacy & Enablement Digital Platform For Health 10
Slide 11: Analytics & Insights
Analytics & Insights Specialty Outpatient Payment Utilization Integrity Management Post-Acute Subrogation Utilization Management 11
Slide 12: Carelon Insights
Carelon Insights Program Integrity Carelon Carelon Carelon Carelon Carelon Medical Benefits Post Acute Subrogation Payment Advocacy Management Solutions Integrity 12
Slide 13: Behavioral Health
Behavioral Health Mental Health and Crisis Solutions Serious Mental Illness Employee Substance Use Assistance Disorder Programs 13
Slide 14: Care Delivery & Enablement
Care Delivery & Enablement Advanced Palliative Primary Care Care Care Provider Home Care / Enablement Post-Acute 14
Slide 15: Pharmacy
Pharmacy Prescription Specialty Cost Pharmacy Management Pharmacy Advanced Network Home Delivery 15
Slide 16: Provider Strategy
Aw Elevance Health Provider Strategy
Slide 17: Broad National Provider Network
Broad National Provider Network 97% 486K of all U.S. hospitals behavioral health providers 700K 350K specialists primary care physicians 17
Slide 18: Our Philosophy
Our Philosophy Contracting Collaborating Connecting for Outcomes for Success for Health 18
Slide 19: Growth in Value-Based Penetration
Growth in Value-Based Penetration 2018 2020 2022 63% 60% 56% 19
Slide 20: Our 2027 Targets
Our 2027 Targets 80% 40% of medical spend in of medical spend in value-based care downside risk 20
Slide 21: Innovation Builds Trust
Innovation Builds Trust Care Providers HealthOS 60% fewer requests for clinical information Health Benefits Carelon EMR Data Connectivity 79% lower appeals Digital Platform For Health Source: Elevance Health Advancing Health Together; Progress Report, March 2023 21
Slide 22: Behavioral Health Pharmacy
Physical Advanced Virtual Palliative Care Primary Care Support Behavioral Health Digital Platform Pharmacy Advanced Home Crisis Support Delivery For Health Specialty Analytics Substance Use Pharmacy Disorder Services Social 22
Slide 23: Driving Health Beyond Healthcare
Driving Health Beyond Healthcare Care Providers Community health advances the individual Health Benefits Carelon Community Connected Care Social resource coordination Digital Platform advances the community For Health 23
Slide 24: Health Benefits
Aw Elevance Health Health Benefits
Slide 25: Health Benefits: Government
Health Benefits Government Medicare and Medicaid 25
Slide 26: Membership Growth, Whole Health & Health Equity, Exceptional Experience
Membership Whole Health & Exceptional Growth Health Equity Experience 26
Slide 27: National Medicare Advantage Penetration
National Medicare Advantage Penetration* 70M 50% 60M 45% 47% 45% 50M 42% 40M 40% 40% 30M 37% 36% 20M 35% 10M 0M 30% 2018 2019 2020 2020 2021 2021 2022 2022 2023 2023 Eligible Medicare Advantage Members Penetration * CMS Jan. 2023 eligible and penetration file 27
Slide 28: Our Medicare Advantage Membership
Our Medicare Advantage Membership 2.0M R CAG 18 % 1.4M 1.0M 2018 2020 2022 28
Slide 29: Medicare Markets
Medicare Markets Top 3 Market Position Blue State Anthem Blue State ELV Non-Blue State 29
Slide 30: Our Medicare Advantage Dual Special Needs Plan Membership
Our Medicare Advantage Dual Special Needs Plan Membership 586K G R CA 26% 275K 188K 2018 2020 2022 30
Slide 31: Health Equity
Health Equity 31
Slide 32: Members Enrolled in a 4+ Star Rated Plan
Members Enrolled in a 4+ Star Rated Plan* Industry Elevance Health 73% 1% Decline 72% 64% th ow Gr % 17 47% 2018 2023 2018 2023 * Percent of members enrolled at the time of scoring in a 4+ plan. 32
Slide 33: Medicaid Markets
Medicaid Markets Anthem Blue States with Medicaid ELV Non-Blue State 33
Slide 34: Federal Projection of Medicaid Spending
Federal Projection of Medicaid Spending R + 5.7% $1,160B C AG – 2 030 $1,097B 202 5 $1,037B $976B $924B $879B $836B $783B $804B $741B $671B $596B $614B 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Source: Centers for Medicare and Medicaid Services Office of the Actuary 34
Slide 35: Medicaid Membership
Elevance Health 6.5M 1.5M 1.3M Non-Elevance Health Elevance Health Medicaid Members Medicaid Medicaid Members in Anthem Blue states Members in Outside Anthem Blue States Anthem Blue States Subject to Redetermination Elevance Health Elevance Health Medicaid Ele Medicare lth va ea H Ind nce e ivi He a
Slide 36: Medicaid Health Equity Accreditation
Medicaid Health Equity Accreditation 21 > 90% membership in health plans accredited plans 36
Slide 37: Government Health Benefits
Government Health Benefits Quality Care Providers Advocacy Whole Health Index Health Benefits Carelon Community Connected Care Behavioral Health Digital Platform Concierge Care For Health 37
Slide 38: Health Benefits: Commercial
Health Benefits Commercial Employers and Individuals 38
Slide 39: Affordability Experience Simplicity
Affordability Experience Simplicity 39
Slide 40: Blue High-Value Networks
Blue High-Value Networks 75+ >15% 80% Major U.S. Average Cost of of U.S. Population Markets Care Savings* * Based on observed results for groups using Blue HVNs as compared with broad network options for 2021 and 2022. 40
Slide 41: Comprehensive Ancillary Product Portfolio
Comprehensive Ancillary Product Portfolio Pharmacy Advocacy Clinical Behavioral Program Health Integrity Dental Vision Stop Loss 41
Slide 42: Commercial Health Benefits
Commercial Health Benefits Blue High-Value Care Total Health Networks Providers Connections Advocacy Health Carelon Benefits Employer Insights Convenient Care HMO Digital Platform For Health 42
Slide 43: Individual Market Coverage 2018
Individual Market Coverage 2018 43
Slide 44: Individual Market Coverage 2023
Individual Market Coverage 2023 44
Slide 45: Medicaid Membership
Elevance Health 6.5M 1.5M 1.3M Non-Elevance Health Elevance Health Medicaid Members Medicaid Medicaid Members in Anthem Blue states Members in Outside Anthem Blue States Anthem Blue States Subject to Redetermination Elevance Health Elevance Health Medicaid Ele Medicare lth va ea H Ind nce e ivi He a
Slide 46: Blue Cross and Blue Shield of Louisiana
Blue Cross and Blue Shield of Louisiana 1.6M new members Opportunities to deploy Carelon offerings Establishment of a multi-billion dollar foundation 46
Slide 47: Financial Targets
Aw Elevance Health Financial Targets
Slide 48: Delivering on our Commitments
Delivering on our Commitments Prior Investor Conference Targets Status Prior Target Adjusted EPS Growth 16% 12% - 15% (2018-2022 CAGR) Operating Revenue Growth 14% 10% - 12% (2018-2022 CAGR) % of Benefit Expense Managed by Carelon 21% > 20% in 2025 (2022 Actual) SG&A Ratio 11.4% 11% - 12% (2022 Actu
Slide 49: Carelon Services & CarelonRx Revenue
Carelon Services & CarelonRx Revenue Carelon Services CarelonRx Low Double Digit CAGR* Upper Teens to Low Twenties $29B CAGR* $22B $12B $6B $1B $0B 2018 2020 2022 2027 2018 2020 2022 2027 Target Target * Five-Year Compound Annual Growth Rate target for 2022-2027 49
Slide 50: Carelon Segment Revenue
Carelon Segment Revenue Mid Teens CAGR* $41B $28B $1B 2018 2020 2022 2027 Target * Five-Year Compound Annual Growth Rate target for 2022-2027 50
Slide 51: Carelon Services
Carelon Services Health Carelon Benefits CarelonRx 51
Slide 52: 2023 Financial Guidance
2023 Financial Guidance Operating Medical Adjusted Earnings Revenue Membership Per Share ~$164B 47.4M - 48.5M > $32.60 52
Slide 53: On Track to Exceed EPS Growth Target
On Track to Exceed EPS Growth Target > $32.60* $29.07 15% $25.98 12% $22.48 $19.44 $15.89 2018 2019 2020 2021 2022 2023 Guidance * 2023 Adjusted EPS guidance exceeds our 12% to 15% target compound annual growth rate off the 2018 base. 53
Slide 54: Health Benefits Financial Targets
Health Benefits Financial Targets Upper Single to Low Double Digit CAGR1 $138B Revenue $108B ($ Billions) $91B 2018 2020 2022 2027 Target 6.0% 5.7% 5.5% - 6.5% 4.5% Operating Margin 2 2018 2020 2022 2027 Target 1. Five-Year Compound Annual Growth Rate target for 2022-2027 2. After adjusting for the
Slide 55: Carelon Financial Targets
Carelon Financial Targets Carelon Services CarelonRx Carelon Total Mid Teens CAGR* Low Double Upper Teens to Digit CAGR* Low Twenties $41B Revenue CAGR* $29B ($ Billions) $12B 2022 2027 2022 2027 2022 2027 Target Target Target Mid to Upper Mid to Upper Single Digit 6.5% 6.0% - 6.5% Single Digit 5.7%
Slide 56: Evolution of Revenue
Evolution of Revenue* Commercial & Specialty ~30% ~25% Government Carelon ~60% ~55% ~70% ~40% ~20% 2008 2018 2022 * Mix of Gross Revenue, 2008 - 2022 56
Slide 57: Enterprise Financial Targets
Enterprise Financial Targets Health Benefits Carelon Elevance Health Upper Single to Low Double Digit CAGR* Upper Single Digit CAGR* $156B Revenue $138B Mid Teens ($ Billions) CAGR* $41B 2022 2027 2022 2027 2022 2027 Target Target Target Mid to Upper Single Digit 5.5% - 6.5% 6.5 % - 7.0% 5.7% 5.5% O
Slide 58: Capital Deployment
Capital Deployment % of Free Cash Flow Dividends 20% M&A / Reinvest in Core Share 50% Repurchase 30% 58
Slide 59: Long-Term Adjusted EPS Growth
Long-Term Adjusted EPS Growth Core Business Drives Growth 12% - 15% CAGR ow th PS Gr m E -T e r ong L $29.07 2022 2027 Adjusted Target Earnings Per Share 59
Slide 60: Forward-Looking Statements
Forward-Looking Statements: This document contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect our views about future events and financial performance and are generally not historical facts. Words s
Slide 61: Forward-Looking Statements (risks and uncertainties)
These risks and uncertainties include, but are not limited to: trends in healthcare costs and utilization rates; reduced enrollment; our ability to secure and implement sufficient premium rates; the impact of large scale medical emergencies, such as public health epidemics and pandemics, including C
Slide 62: Forward-Looking Statements (continued)
our ability to contract with providers on cost-effective and competitive terms; failure to effectively maintain and modernize our information systems; risks associated with providing pharmacy benefit management (“PBM”), healthcare and other diversified products and services, including medical malpra
Slide 63: Elevance Health
Aw Elevance Health