PDP membership increased by 22% year-over-year, indicating successful strategic positioning in the Medicare market. However, Medicare Advantage membership declined by 9% year-over-year, indicating a shift in the Medicare segment.

The Ambetter Health product expanded into 60 new counties across 10 states, including Iowa, leading to a 29% increase in Marketplace membership year-over-year. This expansion demonstrates a commitment to growth in the individual market.

Managed care membership decreased by 479 thousand members, or (2)%, year-over-year, primarily due to Medicaid redeterminations. The company is working with state partners to match rates to acuity post-redeterminations.

The SG&A expense ratio decreased to 7.9% compared to 8.9% in the first quarter of 2024, driven by leveraging expenses over higher revenues and growth in the PDP business. This indicates improved operational efficiency and cost management.

The company is actively monitoring and advocating for legislation related to Medicaid coverage expansions and mitigating adverse legislation. They are also navigating changes in Medicare Prescription Drug Plans (PDPs) due to the Inflation Reduction Act (IRA).

The company is protesting the results of Medicaid procurement awards in Georgia and Texas, indicating potential concerns about the fairness or accuracy of the procurement process. The outcome of these protests could impact future results of operations.

The imposition of tariffs by the U.S. government and any retaliatory tariffs imposed in response is uncertain, including in the amount, applicability and duration of such tariffs. Such tariffs could increase the costs of healthcare, including pharmaceutical drugs, medical devices and other healthcare supplies and equipment.

The company has $2.2 billion remaining under its stock repurchase program, indicating a commitment to returning capital to shareholders. During the quarter, $41 million was used for stock repurchases related to income tax withholding.

The company expects to receive $2.2 billion in net dividends from its insurance subsidiaries, demonstrating strong cash flow generation from its core operations. This provides flexibility for capital deployment.

The company expects to spend $615 million in additional capital expenditures, indicating ongoing investments in its infrastructure and operations. The majority of capital expenditures was driven by system enhancements and computer hardware.