Health insurers — companies that run health plans and pay for members' medical bills in exchange for monthly premiums, like large HMOs.
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UnitedHealth to Drop 390,000 Medicare Advantage Members in 2027
UnitedHealth Group is scaling back parts of its Medicare Advantage business for 2027, with UnitedHealthcare discontinuing plans covering about 390,000 members next year as elevated medical costs and utilization pressure profitability. Reuters reported that UnitedHealthcare plans to exit locations where it has a higher concentration of preferred provider organization plans, which offer broader out-of-network access but can carry higher costs. UnitedHealthcare said 66% of members will have access to both health maintenance organization and PPO plans in 2027, compared with 70% in 2026. Beyond portfolio changes, UnitedHealth plans to invest nearly $1.5 billion in AI-related initiatives in 2026 to improve productivity and reduce administrative burden. Competitors are making similar moves: Humana is pruning its Medicare Advantage portfolio for 2027 with exits expected to affect roughly 600,000 members, while Centene's Wellcare is reducing its plan lineup and exiting Hawaii, Oklahoma and Tennessee.
UNH · Regulation · Negative UnitedHealthcare is discontinuing Medicare Advantage plans covering about 390,000 members for 2027 amid elevated medical costs.
UNH · Technology · Positive UnitedHealth plans to invest nearly $1.5 billion in AI-related initiatives in 2026 to improve productivity and reduce administrative burden.
HUM · Regulation · Negative Humana is pruning its Medicare Advantage portfolio for 2027, with exits expected to affect roughly 600,000 members.
CNC · Regulation · Negative Centene's Wellcare is reducing its Medicare Advantage plan lineup and exiting Hawaii, Oklahoma and Tennessee, mirroring the industry pullback.
UnitedHealth Group Shares Gain 1.83% Ahead of October 13 Earnings Report
UnitedHealth Group closed at $371.90, up 1.83% and ahead of the S&P 500's 0.73% gain, as investors look toward the insurer's October 13, 2026 earnings disclosure. Analysts expect earnings per share of $4.12, a 41.1% rise from the same quarter a year earlier, while revenue is projected at $111.38 billion, down 1.57% year over year. For the full year, the Zacks Consensus Estimates forecast earnings of $19.85 per share and revenue of $446.78 billion, changes of +21.41% and -0.18% respectively. The stock carries a Zacks Rank of #2 (Buy) and trades at a forward P/E of 18.4, a discount to the industry average of 21.25, with a PEG ratio of 1.37. The Medical - HMOs industry holds a Zacks Industry Rank of 21, placing it in the top 9% of more than 250 industries.
UNH · Capital · Neutral Shares rose ahead of the Oct 13 earnings report, with analysts expecting EPS of $4.12 (+41.1% YoY) but revenue down 1.57%; Zacks Rank #2 and forward P/E discount are valuation context.
Humana Shrinks Medicare Advantage Footprint for 2027
Humana will offer Medicare Advantage plans in nearly 2,600 counties across 45 states and Washington, D.C. for the 2027 plan year, a sharp reduction from the 46 states and Washington, D.C. it covered for 2026, when its plans reached 85% of U.S. counties. The Louisville, Kentucky-based insurer, the second-largest MA player behind UnitedHealth, said the new footprint represents more than 80% of U.S. counties, and it has announced plans to discontinue offerings affecting 600,000 enrollees. UnitedHealth said its UnitedHealthcare MA plans will remain accessible to 94% of Medicare-eligible individuals next year, unchanged from 2026, though Bloomberg reported that roughly 390,000 people will be part of plans being shut down. CVS Health's Aetna unit and Centene are also pulling back their MA offerings, according to CMS data reviewed by Wall Street analysts, while Alignment Healthcare is expanding to 55 counties and Clover Health said its plans will reach 5.2M Medicare-eligible individuals across 203 counties in five states. The moves come as the MA market contends with rising medical costs and intense government scrutiny, and after CMS said 2027 MA enrollment is expected to reach 34M, a 6% decline, despite a more than 16% drop in MA premiums versus 2026 on a weighted average basis.
HUM · Regulation · Negative Humana is sharply shrinking its 2027 Medicare Advantage footprint and discontinuing plans affecting 600,000 enrollees amid rising costs and government scrutiny.
ALHC · Demand · Positive Alignment Healthcare is expanding its Medicare Advantage footprint to 55 counties, a growth move against peers' pullbacks.
CLOV · Demand · Positive Clover Health said its plans will reach 5.2M Medicare-eligible individuals across 203 counties in five states, an expansion.
CNC · Regulation · Negative Centene is pulling back its Medicare Advantage offerings amid rising medical costs and intense government scrutiny.
CVS · Regulation · Negative CVS Health's Aetna unit is pulling back its Medicare Advantage offerings amid rising medical costs and government scrutiny.
UNH · Regulation · Neutral UnitedHealth's MA plans stay at 94% coverage unchanged, but ~390,000 enrollees are in plans being shut down amid MA market scrutiny and rising costs.
HealthEquity Appoints Moody's CFO Noémie Heuland to Board
HealthEquity, Inc. announced that Noémie Heuland, Chief Financial Officer of Moody's Corporation, has been elected to its board of directors effective Sept. 24, 2026. Heuland will also serve on the Board's Audit and Risk Committee and Cybersecurity and Technology Committee. Her appointment expands the Board to 11 directors, nine of whom are independent. Heuland has served as CFO of Moody's since April 2024, and previously was CFO at Dayforce, Inc. from October 2020 to February 2024, after 12 years in finance leadership roles at SAP. HealthEquity, the largest independent health savings account custodian by account volume, administers HSAs and other consumer-directed benefits for nearly 18 million accounts.
UnitedHealth Group Names Robert Hunter President of UnitedHealthcare
UnitedHealth Group has appointed Robert Hunter as president of UnitedHealthcare as part of a leadership realignment. The new UnitedHealthcare chief is expected to help advance a multi-year plan focused on margin recovery and modernization of operations, with a remit that includes restoring confidence among regulators and customers while sharpening the business's digital experience across key insurance offerings. The company also added Jodee Kozlak as chief administrative officer, moves that point to execution on margin recovery while technology and AI programs target G&A savings. UnitedHealth Group, a US-based healthcare operator with a market value of about $339.1 billion, runs insurance and health-benefits operations in the United States and internationally. The cleanest check on whether the leadership reset is working will be how reported segment margins and medical cost trends at UnitedHealthcare and Optum move through 2027, especially in Medicare and Medicaid where management already flagged pressure on profitability.
UNH · Capital · Neutral UnitedHealth names Robert Hunter president of UnitedHealthcare as part of a leadership realignment aimed at margin recovery and operational modernization.
Robert Hunter Named President of UnitedHealth Insurance Arm UnitedHealthcare
Robert Hunter will take over as president of UnitedHealthcare, the insurance division of UnitedHealth Group, disclosing the move himself on September 28 in a LinkedIn post. The company has issued no comment on the reasoning behind the appointment, which places Hunter in charge of the unit where the medical cost pressure that reset UnitedHealth's earnings was concentrated. UnitedHealth generates roughly $450 billion of revenue a year, and the insurance business is the largest part of it, so a single percentage point on the medical loss ratio moves billions of dollars of profit at that revenue base. Hunter arrives from inside the company rather than outside it, which more often signals continuity of strategy than a change of direction. The division's recovery so far has come from cost control rather than growth: quarterly earnings grew 61% against the same period a year earlier, annual free cash flow runs near $24.27 billion, but revenue rose just 0.4% in the latest quarter, while operating margin sits at 7.13% and the company carries $73.33 billion of debt.
UnitedHealth Group announced that Jodee Kozlak has joined the company as chief administrative officer, a newly created role overseeing People, Real Estate, Procurement and Corporate Security to support enterprise modernization and alignment across the business. Kozlak previously led global expansion at Alibaba and human resources at Target, and has served on the boards of C.H. Robinson Worldwide and KB Home. The appointment signals a greater emphasis on organizational efficiency and large-scale transformation as UnitedHealth works to restore margins through plan exits and pricing resets. The hire follows the company's Q2 2026 earnings, which showed improved operating earnings even as revenue growth stayed muted. UnitedHealth's narrative projects $498.6 billion in revenue and $23.5 billion in earnings by 2029, requiring 3.5% yearly revenue growth and about a $9.4 billion earnings increase from $14.1 billion today.
UNH · Capital · Neutral UnitedHealth creates a new chief administrative officer role to support enterprise modernization and margin restoration, a leadership/organizational change with no clear directional impact.
UnitedHealth Group Names Jodee Kozlak Chief Administrative Officer
UnitedHealth Group announced that Jodee Kozlak will join the company as chief administrative officer, a newly created role, effective Sept. 28, 2026. In the position, Kozlak will help drive enterprise modernization and alignment efforts supporting the company's businesses, people and partners, leading a portfolio that initially includes People, Real Estate, Procurement and Corporate Security. Chief executive officer Stephen Hemsley said Kozlak brings exceptional experience across business strategy, organizational development and governance, and that her record of leading through periods of growth and transformation will accelerate the company's efforts to improve how it operates, collaborates and serves its stakeholders. Kozlak served as global senior vice president of Alibaba Group from 2016 to 2017, helping lead the company's expansion outside China, and held several human resources and legal leadership roles at Target Corp., including executive vice president and chief human resources officer from 2004 to 2015. She also serves as chair of the board for C.H. Robinson Worldwide and as lead independent director for KB Home.
Molina to End Traditional Medicare Advantage Drug Plans After December 31, 2026
Molina Healthcare will exit its traditional, non-dual Medicare Advantage prescription drug plans after December 31, 2026, a decision CEO Joe Zubretsky announced on the company's February 5, 2026 fourth-quarter earnings call as a shift to focus exclusively on dual eligible members in Medicare. The exiting MAPD contracts covered approximately 117,000 members in 2025, with enrollment expected to fall to about 80,000 during 2026, and the product was expected to produce approximately $1 billion in 2026 premium revenue. Molina is staying in Medicare and keeping its $5 billion dual-eligible Medicare business, and continues to pursue new Duals contracts in Idaho, Illinois, Massachusetts, Michigan, and Ohio. The formal member nonrenewal letter, governed by the CMS calendar, does not go out until early October, leaving affected members roughly eight weeks to act before the December 7 end of the Annual Enrollment Period. Members who do nothing risk returning to Original Medicare on January 1 without prescription coverage, and going 63 straight days without Part D or other creditable drug coverage can trigger a late-enrollment penalty starting January 1, 2027.
MOH · Regulation · Negative Molina will exit its traditional non-dual Medicare Advantage prescription drug plans after 2026, dropping ~117,000 members and ~$1B in 2026 premium revenue under the CMS-governed nonrenewal process.
Centene Corporation reported second-quarter 2026 results showing a profitability recovery, with premium and service revenues up 4.5% year over year and adjusted EPS of $2.51 versus a loss of 16 cents a year ago. The insurer reaffirmed its 2026 adjusted EPS guidance floor above $4.80 and said its consolidated health benefits ratio improved to 89.6% from 93%. Centene expects its Marketplace business to generate a 4.5%-5% pretax margin in 2026, while its PDP business should deliver a pretax margin above 3% and Medicare Advantage moves closer to breakeven. Membership remains the main pressure point: Medicaid enrollment ended the second quarter of 2026 at 12.1 million, down 5.5% year over year, and the company projects full-year Medicaid membership to decline 8%-9% from year-end 2025. Centene raised its expected 2026 Medicaid rate increase to about 5%, which could cushion some of the impact as medical-cost trends remain in the mid-4% range.
UnitedHealth Earns Zacks Rank #2 as Earnings Estimates Hold Steady
UnitedHealth Group holds a Zacks Rank #2 (Buy), with consensus estimates pointing to earnings of $4.03 per share for the current quarter, a year-over-year change of +38%. The Zacks Consensus Estimate for the quarter remained unchanged over the last 30 days, while the $19.82 consensus for the current fiscal year, indicating a year-over-year change of +21.2%, has moved +0.6% over the same period. For the next fiscal year, the consensus estimate of $22.54 implies a change of +13.7%, having risen +0.5% over the past month. Revenue consensus stands at $111.38 billion for the current quarter, a year-over-year change of -1.6%, with $446.78 billion and $458.33 billion expected for the current and next fiscal years, changes of -0.2% and +2.6% respectively. In the last reported quarter, UnitedHealth posted revenues of $112.03 billion, up +0.4% year over year, and EPS of $6.38 versus $4.08 a year earlier, beating the consensus revenue estimate of $110.12 billion by +1.74% and the EPS estimate by +29.15%. The stock carries a Zacks Value Style Score of B, indicating it trades at a discount to its peers.
UNH · Capital · Positive UnitedHealth holds a Zacks Rank #2 (Buy) with steady-to-rising consensus EPS estimates and a Value Style Score of B, an analyst-valuation signal.
UnitedHealth's turnaround is proceeding largely on plan, but commercial health plan medical costs are running modestly above the 11% the company had been expecting, while Medicare costs are tracking below its roughly 10% estimate for 2026 and Medicaid trend is broadly in line. Management credits benefit design, care management, network curation and a lighter respiratory season for Medicare landing below plan, and attributes the commercial overrun to the independent resolution process under the No Surprises Act, which it calls ineffective. On its earnings call, management said IDR dispute awards contributed approximately 50 basis points of incremental medical cost trend in 2026 and now account for at least 100 basis points of total cost, with roughly 60% of all arbitration cases brought by just five entities and average payouts to out-of-network providers now 11 times what Medicare would pay. The elevated trend has pushed the timeframe for full commercial margin recovery past 2027, which management calls a delay rather than a setback, and it still expects Medicaid margins to stay pressured for 2026. UnitedHealth lifted 2026 adjusted earnings per share guidance to $19.50 to $20 and reaffirmed its 13%-16% long-term growth rate, though its operating margin over the last twelve months, at 4.8%, remains below its three-year average of 7.1%.
UNH · Capital · Positive UnitedHealth lifted 2026 adjusted EPS guidance to $19.50-$20 and reaffirmed its 13%-16% long-term growth rate.
UNH · Regulation · Negative No Surprises Act IDR arbitration awards added ~50bp to 2026 medical cost trend and pushed full commercial margin recovery past 2027.
Centene and Archer-Daniels-Midland Raise 2026 Guidance on Strong Valuations
Centene Corp. and Archer-Daniels-Midland Co. each raised their 2026 guidance while trading at valuations below their industries and the S&P 500. Centene now expects premium and service revenues of $173-$177 billion for 2026, up from a prior range of $171-$175 billion, and total revenues of $193.5-$197.5 billion, up from $187.5-$191.5 billion, with adjusted EPS expected to exceed $4.80 versus the prior guidance of greater than $3.40, a surge of more than 130.8% from 2025. Archer-Daniels-Midland raised its 2026 adjusted earnings guidance to approximately $5.15-$5.60 per share from a previous range of $4.15-$4.70, citing finalized renewable volume obligations under the U.S. Renewable Fuel Standard, global trade dynamics and higher energy prices, and continues to project 2026 capital expenditures of $1.3-$1.5 billion. Centene shares have jumped 68.7% year to date and carry a forward P/E of 13.58X, below the industry's 22.23X and the S&P 500's 18.03X, while Archer-Daniels-Midland shares have surged 50.4% year to date with a forward P/E of 16.60X. Both stocks hold a Zacks Rank #1 (Strong Buy), and their Zacks Consensus Estimates for current-year earnings have improved 40.9% and 8.5%, respectively, over the last 60 days.
ADM · Capital · Positive ADM raised its 2026 adjusted earnings guidance to ~$5.15-$5.60 per share from $4.15-$4.70, citing finalized renewable volume obligations, trade dynamics and higher energy prices.
CNC · Capital · Positive Centene raised its 2026 revenue and adjusted EPS guidance (EPS to exceed $4.80 vs prior >$3.40).
UnitedHealth Sells TPG Stake in Florida WellMed Clinics to Aid Optum Turnaround
UnitedHealth Group has sold an interest in some of its Optum Health operations in Florida to private-equity firm TPG, specifically involving its WellMed clinics that focus heavily on older patients. The company's CFO said the move is not about raising cash but about bringing in a partner that can provide local operating expertise and help the Florida business grow faster while UnitedHealth concentrates on its broader Optum Health turnaround. The timing is significant because Optum Health posted a negative operating margin in 2025 as medical costs rose and Medicare-related economics weakened, and UnitedHealth is now targeting an Optum Health margin of roughly 2% in 2026, 4% in 2027, and 6% in 2028. Optum says its Florida operations serve more than 240,000 patients across nearly 600 locations, and UnitedHealth is still opening roughly 15 clinics a year in Florida. The partnership does not eliminate the underlying pressures that caused Optum Health's problems: the division generated a $1.1 billion operating loss in 2025, compared with $6.9 billion of operating income the year before.
UNH · Capital · Neutral UnitedHealth sells a WellMed stake to TPG to bring local operating expertise and aid its Optum Health turnaround amid a $1.1B 2025 operating loss
TPG · Capital · Positive TPG acquires a stake in UnitedHealth's WellMed clinics, a private-equity deal for TPG
UnitedHealth sells Optum Florida stake to TPG as CooperCompanies cuts guidance and Amgen slides
UnitedHealth has sold an interest in some of its Optum Health operations in Florida to private equity firm TPG, part of the health conglomerate's effort to recover from a collapse in profits last year. CFO Wayne DeVeydt told Bloomberg News that Optum Health margins will be around 2% this year, above prior expectations, and should rise to around 4% in 2027 and 6% the following year. Amgen fell more than 8%, its worst single-day decline since 2016, after Novartis announced a Phase 3 trial failure for the heart disease therapy pelacarsen, which it is developing with Ionis Pharmaceuticals; BMO Capital Markets downgraded Amgen to Market Perform from Market Outperform with a $450 price target. CooperCompanies dropped 13% after issuing fiscal 2026 guidance below consensus, with revenue of $4.229B-$4.252B versus the prior $4.285B-$4.321B and non-GAAP diluted EPS of $4.51-$4.55 versus $4.58-$4.66 previously, and said its board decided to keep CooperSurgical rather than sell it while raising its share buyback authorization to $3B from $2B. Novo Nordisk fell more than 1% premarket after Morgan Stanley downgraded the stock to Underweight from Equal-weight, citing the semaglutide patent cliff, and the S&P 500 Health Care Sector Index slipped more than 3.5% for the week.
AMGN · Capital · Negative BMO downgraded Amgen to Market Perform with a $450 price target after Novartis's pelacarsen Phase 3 failure.
COO · Capital · Negative CooperCompanies issued fiscal 2026 guidance below consensus and cut its EPS outlook.
UNH · Capital · Positive UnitedHealth sold an Optum Florida stake to TPG and guided Optum Health margins to ~2% this year, rising to ~4% in 2027 and 6% after, aiding its profit recovery.
IONS · Technology · Negative Novartis announced a Phase 3 trial failure for pelacarsen, which it is developing with Ionis Pharmaceuticals.
NVO · Capital · Negative Morgan Stanley downgraded Novo Nordisk to Underweight from Equal-weight, citing the semaglutide patent cliff.
MS · Capital · Negative Morgan Stanley downgraded Novo Nordisk to Underweight from Equal-weight.
UnitedHealth's Optum Sells Florida WellMed Stake to TPG
UnitedHealth Group's Optum has sold an interest in its Florida WellMed clinics to private equity firm TPG and entered a strategic partnership with the firm, according to Bloomberg. The clinics will remain in Optum's network and continue serving patients, while TPG is expected to add local focus, technology investments and operating capabilities to help the Florida business grow faster. CFO Wayne DeVeydt said the goal was not to raise cash but to find a partner that could work with the company locally. Optum acquired WellMed back in 2011, and UnitedHealth opens about 15 clinics in Florida each year. TPG also acquired Optum UK, another UnitedHealth subsidiary, earlier in 2026. Optum Health generated $102 billion of revenue in 2025, down 3% year over year, with operating margins below zero, and management now expects margins of about 2% in 2026, roughly 4% in 2027 and 6% in 2028. UnitedHealth's second-quarter medical care ratio was 86.7%, improving 270 basis points from the year-ago period, while peers Humana and Elevance Health both saw their second-quarter 2026 ratios deteriorate year over year.
UNH · Capital · Positive Optum sold a WellMed stake to TPG and partnered with it to accelerate Florida growth, while Optum Health margins are guided to recover from below zero to ~2% in 2026.
TPG · Capital · Positive TPG acquired a stake in Optum's Florida WellMed clinics and formed a strategic partnership, expanding its healthcare investments.
Optum UK · Capital · Neutral Noted that TPG also acquired Optum UK earlier in 2026, a prior transaction rather than the focus of this news.
UnitedHealth Stock Falls After Selling Optum Health Stake to TPG
UnitedHealth Group shares fell about 2.5% after the company sold an interest in part of its Optum Health business in Florida to private equity firm TPG. The transaction involves operations linked to WellMed, which runs senior-focused primary-care clinics, and financial terms were not disclosed. Chief Financial Officer Wayne DeVeydt said the arrangement was intended to bring additional local expertise rather than provide funding, and that working with TPG could allow the clinic network to expand faster. The deal comes as UnitedHealth seeks to improve performance at Optum Health, which contributed to weaker profits last year; DeVeydt said the division is expected to produce a 2% margin this year and a 4% margin next year. TPG had $326.8 billion in assets under management and $76.2 billion in available capital at the end of the second quarter.
UnitedHealth to Invest $1.5B in AI to Boost Optum Insight
UnitedHealth Group is making artificial intelligence a bigger part of its strategy to strengthen Optum Insight's growth, planning to invest nearly $1.5 billion in AI-related initiatives in 2026, with about one-third earmarked for software products and platforms. The strategy is moving beyond experimentation into commercial products, expanding AI capabilities across autonomous coding, digital prior authorization, real-time payer-provider interfaces, and clinical quality and safety tools. Digital prior authorization is showing early traction, with AI achieving a 96% first-pass approval rate while retaining human review for cases not approved. Value Connect, another AI platform, has helped early customers achieve a 17% reduction in pharmacy costs. Optum Insight generated $5.4 billion in second-quarter 2026 revenues, with operating earnings up 13.6% year over year and margin improving to 25.3%. UnitedHealth trades at a forward price-to-earnings ratio of 18.48, above the industry average of 16.02, and carries a Zacks Rank #1 (Strong Buy).
UnitedHealth has sold an interest in its Optum Health operations in Florida to private equity firm TPG, as the health conglomerate works to recover from a collapse in profits last year. CFO Wayne DeVeydt told Bloomberg News that the partnership with TPG will allow the business to grow more quickly while UnitedHealth focuses on a broader turnaround. The company is reorienting after disappointing profit results driven by failures in its Optum Health division, which runs medical clinics, and has replaced its CEO and other leaders. DeVeydt said Optum Health margins will be around 2% this year, higher than previously expected, and should rise to about 4% in 2027 and 6% the following year. UnitedHealth stock has risen 21% year-to-date.
UnitedHealth Sells Florida WellMed Clinics Stake to TPG
UnitedHealth Group Inc. has sold an interest in its Optum Health operations in Florida to private equity firm TPG Inc., as the health conglomerate works to recover from a collapse in profits last year. The Florida clinics are part of Optum's WellMed business, which focuses on healthcare for older people. UnitedHealth CFO Wayne DeVeydt said the company didn't need the money but needed a local partner to help the business grow faster while executing a broader turnaround. Optum Health's operating margins were negative last year due to rising healthcare costs and restricted federal payments, prompting leadership changes. DeVeydt said Optum Health margins will be around 2% this year, rising to about 4% in 2027 and 6% in 2028. TPG also bought Optum UK earlier this year, generating $400 million for the United Health Foundation. UnitedHealth expects to reaffirm its financial guidance on Wednesday at a Wells Fargo investor conference.
UNH · Capital · Neutral UnitedHealth sells a WellMed stake to TPG to gain a local partner for growth amid an Optum Health margin turnaround.
TPG · Capital · Positive TPG bought a stake in UnitedHealth's Florida WellMed clinics and earlier acquired Optum UK, expanding its healthcare portfolio.
Optum UK · Capital · Positive TPG bought Optum UK earlier this year, generating $400 million for the United Health Foundation.
UnitedHealth stock has gained about 41% since early March, trading near $400 a share, but the company's turnaround is incomplete: while Medicare and care-delivery margins improved, its commercial book deteriorated. Management now expects full margin recovery in the commercial segment to extend past 2027, with medical cost trend running above 11% and no signs of moderation. The company's overall operating margin stands at 4.8%, below its three-year average of 7.1%, and adjusted 2026 earnings guidance is $19.50 to $20 per share, with segment operating-earnings outlooks of at least $12 billion for UnitedHealthcare and at least $2.2 billion for Optum Health. Rivals also repriced, with Elevance Health up 41.6% and Cigna up 4.7% over the same period, but UnitedHealth's commercial cost trend has not yet turned.
UNH · Capital · Negative Commercial margin deterioration and delayed recovery past 2027, with medical cost trend above 11% and adjusted 2026 guidance below prior expectations.
UnitedHealth Raises 2026 EPS Outlook as Recovery Gains Traction
UnitedHealth Group is showing signs of recovery after a turbulent 2025, with first-half 2026 revenues up 1.2% year over year and adjusted earnings per share up 20.5%. The company's medical care ratio improved to 86.7% in the second quarter from 89.4% a year earlier, helping UnitedHealthcare's operating margin expand to 4.6% from 2.4%. Optum also contributed, with operating income rising 29% to $4 billion in the quarter. As a result, UnitedHealth raised its 2026 adjusted EPS outlook to $19.50-$20, though risks remain from elevated medical costs and membership declines. The company's shares have gained 28.7% over the past year, and it trades at a forward P/E of 18.46, above the industry average of 15.99.
Centene's Marketplace Recovery Boosts Earnings Outlook
Centene Corporation is rebuilding its Marketplace business after a difficult 2025, with the segment's health benefits ratio improving to 79.2% in the second quarter of 2026 from 90.6% a year ago, helped by better pricing, moderating medical costs, and a $180 million favorable CMS risk-adjustment reconciliation. Although Marketplace membership fell to about 3.5 million from 5.9 million, the company now expects a 4.5% to 5% pretax margin for 2026, up from a prior 3% outlook, signaling a shift toward profitability over volume. The challenge is sustaining gains amid potential membership attrition from eligibility reviews, but an improved SG&A expense ratio of 6.9% and increased use of technology and AI could provide support. Centene's shares have surged 56.4% year-to-date, and the Zacks Consensus Estimate for 2026 earnings is $4.89 per share, implying 135.1% growth, with the stock carrying a Zacks Rank #1 (Strong Buy).
HealthEquity posted second-quarter fiscal 2027 results on August 27, with revenue growth accelerating to 8% year over year from 7% in the first half, and adjusted EBITDA rising 11% to $167 million, a record 48% margin. The company raised its full-year guidance to $1.411 billion to $1.421 billion in revenue and $628 million to $636 million in adjusted EBITDA. New HSAs from sales jumped 24% to 202,000, total HSA assets reached $37.9 billion, and invested assets climbed 28% to $20.6 billion. CFO James Lucania acknowledged "absolutely headline price erosion" pressuring service revenue, which still grew 6% to $124.4 million, while GAAP net income of $65.6 million, or $0.78 per diluted share, trailed non-GAAP results of $103.8 million and $1.24 per share. The company returned $108.1 million to shareholders through buybacks during the quarter.
HealthEquity Inc reported record second-quarter results, with revenue growth accelerating to 8% year-over-year and adjusted EBITDA margin reaching a record 48%, prompting the company to raise its fiscal 2027 guidance. Service revenue hit a record $124.4 million, custodial revenue grew 10% to a record $175.9 million, and interchange revenue rose 5% to $50.4 million, contributing to a record gross profit of $258 million, approximately 74% of revenue. GAAP net income was a record $65.6 million, or $0.78 per diluted share, while non-GAAP net income reached $103.8 million, or $1.24 per diluted share. The company also reported record HSA accounts of 10.7 million, up 8% year-over-year, and repurchased approximately $108 million of shares at an average price below $90. For fiscal 2027, HealthEquity expects revenue between $1.411 billion and $1.421 billion, GAAP net income of $242 million to $248 million, non-GAAP net income of $392 million to $398 million, and adjusted EBITDA between $628 million and $636 million.
HealthEquity Raises Fiscal 2027 Revenue Guidance to $1.411B-$1.421B
HealthEquity raised its fiscal 2027 revenue guidance to between $1.411 billion and $1.421 billion, citing strong first-half performance and record profitability, including a record adjusted EBITDA margin of 48%. CEO Scott Cutler highlighted record HSA accounts of 10.7 million and a 62% year-over-year increase in monthly active app users to 1.4 million, while CFO James Lucania reported record service revenue of $124.4 million, custodial revenue of $175.9 million, and net income of $65.6 million, or $0.78 per diluted share. The company also guided adjusted EBITDA to $628 million to $636 million and expects average yield on HSA cash between 3.85% and 3.9% for fiscal 2027. Management emphasized AI-driven efficiency, with AI resolving 85% of routine chat inquiries, and noted Marketplace traction with over 14,000 active members, though revenue from Marketplace remains immaterial. The outlook also reflects continued investment in growth initiatives and additional share repurchases.
HQY · Capital · Positive Company raises fiscal 2027 revenue guidance and reports record profitability, including record adjusted EBITDA margin and strong financial results.
UnitedHealth Commercial Cost Trend Delays Margin Recovery Past 2027
UnitedHealth's commercial medical cost trend is running modestly above 11%, pushing full commercial margin recovery past 2027. Management said the independent resolution process under the No Surprises Act is adding 50 basis points of incremental trend in 2026 and now totals at least 100 basis points of cost. The company raised adjusted earnings per share guidance for 2026 to a range of $19.50 to $20, and shares trade at $390.11. Medicare is improving, with the 2026 medical cost trend expected to come in below the initial estimate of around 10%, but management said the softer trend is not an inflection point. UnitedHealthcare expects full-year 2026 Medicare Advantage enrollment to decline by approximately 1.1 million through benefit adjustments and selective market participation changes.
UnitedHealth Prioritizes Medicare Advantage Profitability Over Membership Growth
UnitedHealth Group is shifting its Medicare Advantage strategy to prioritize profitability over membership expansion, expecting 2026 enrollment to decline by approximately 1.1 million members due to targeted exits from unprofitable plans. Medicare margins are now expected to finish the year above 3%, reflecting tighter benefit design, pricing actions, and a more favorable membership mix, while the company expects Medicare medical cost trends to come below the initial estimate of near 10%. UnitedHealth's consolidated medical care ratio improved to 86.7% in the second quarter from 89.4% a year ago, and the company raised its 2026 adjusted EPS outlook to $19.50-$20. The Zacks Consensus Estimate for UnitedHealth's 2026 earnings is pegged at $19.69 per share, implying 20.4% growth from the year-ago period, and the stock currently carries a Zacks Rank #1 (Strong Buy).
UNH · Capital · Positive UnitedHealth raised its 2026 EPS outlook and reported improved margins, signaling strong financial performance.
ELV · Competition · Negative UnitedHealth's strategic shift to prioritize profitability may pressure competitors like Elevance to follow suit, potentially impacting their growth.
HUM · Competition · Negative Humana faces competitive pressure as UnitedHealth exits unprofitable plans, potentially reshaping the market and affecting Humana's positioning.
Molina Healthcare reported second-quarter 2026 adjusted earnings per share of $1.51, beating the Zacks Consensus Estimate by 10.2% but down 72.4% year over year. Revenues fell 4.8% to $10.9 billion, slightly missing consensus, while total membership dropped 14.3% to about 4.9 million. The company raised its full-year 2026 adjusted earnings guidance by $0.25 to at least $5.25 per diluted share and its GAAP earnings guidance to at least $2.15 per share. Shares have lost about 1.7% since the earnings report, underperforming the S&P 500.
Humana Star Ratings Recovery Seen as Key Medicare Advantage Catalyst
Humana's Star Ratings recovery is emerging as a key catalyst for its Medicare Advantage turnaround, with the company targeting a return to top-quartile performance by bonus year 2028. The company defines top-quartile performance as Stars revenue per member per month 10% above the peer median, and a successful recovery could improve the economics of its MA plans and complement other margin initiatives. Early execution signals are encouraging, with the rate of improvement across 11 of 12 selected HEDIS and patient-safety measures outpacing historical trends. The October Centers for Medicare & Medicaid Services Stars release will be the key near-term test, and a meaningful rebound could strengthen the case that Humana is on a credible path toward its 2028 margin target of at least 3% pretax. Shares of Humana have gained 47.6% year to date, outperforming the broader industry's 20.2% growth, and the stock trades at a forward price-to-earnings ratio of 29.24X versus the industry average of 15.98X.
McKesson reported second-quarter revenues of $105.4 billion, up 7.7% year over year and 1.2% above analyst expectations, while its stock remained flat at $868.87. Among the 39 healthcare providers and services stocks tracked, aggregate revenues beat consensus by 1.7% and next-quarter guidance came in 1.6% above estimates, yet the group's average share price fell 1.2% since earnings. CVS Health posted the best quarter with revenues of $106.1 billion, up 7.3% and 6.7% above expectations, but its stock dropped 9.1% to $94.90. AdaptHealth was the weakest performer, missing revenue estimates by 12.6% with revenues of $740.3 million and issuing significantly lower full-year revenue and EBITDA guidance, sending its stock down 46.2% to $5.83. Elevance Health reported flat revenues of $49.83 billion, beating estimates by 2.5%, but lost 469,000 customers and saw its stock fall 7.4% to $395.18, while Quest Diagnostics grew revenues 10.2% to $3.04 billion and its stock rose 12.6% to $236.32.
UnitedHealth contests IRS proposal to raise taxable income over foreign subsidiary pricing
UnitedHealth Group is contesting an Internal Revenue Service proposal to significantly increase its taxable income over how it priced transactions with one of its foreign subsidiaries. The notices cover transactions between UnitedHealth and a foreign subsidiary from the 2017 through 2020 tax years, and the IRS could seek similar adjustments for later years. UnitedHealth said it believes its tax positions are properly supported and plans to vigorously contest the proposed adjustments. The dispute is part of a broader IRS push to scrutinize transfer pricing by U.S. multinationals, with similar battles involving Coca-Cola, Meta, and Medtronic. Neither UnitedHealth nor the IRS has disclosed the subsidiary's identity, the transactions at issue, or the dollar amount sought.
UnitedHealth Group Hit With Investor Lawsuit Over Governance And Cybersecurity Claims
UnitedHealth Group is facing a major investor lawsuit alleging longstanding corporate governance and cybersecurity failures tied to its Change Healthcare acquisition. The complaint claims oversight gaps at UnitedHealth contributed to what plaintiffs describe as the largest healthcare data breach in U.S. history. Investors argue that weaknesses in internal controls and board level risk management left sensitive patient and claims data exposed. The case raises fresh questions for shareholders about how UnitedHealth assesses, oversees, and discloses cybersecurity and acquisition related risks.
Humana cuts Medicare Advantage plans for second straight year
Humana is exiting some Medicare Advantage plans for next year, forcing more than half a million seniors to find new coverage. CFO Celeste Mellet cited high costs and slimmer profit margins in certain markets, marking the second consecutive year of downsizing after the company exited three states and 194 counties affecting around 500,000 members. UnitedHealthcare also dropped plans serving more than 600,000 seniors, and KFF research shows 60% or more of enrollees faced terminated plans in Wyoming, South Dakota, New Hampshire, North Dakota, and Vermont. Despite the cuts, most seniors will still have options, though some may see higher copays or reduced benefits, and experts advise checking provider networks during Medicare open enrollment from Oct. 15 to Dec. 7.
Humana, UnitedHealth cut Medicare Advantage plans to protect margins
Humana and UnitedHealth Group are dropping hundreds of thousands of Medicare Advantage members to protect profit margins as rising utilization drives up costs. Humana announced it will cut more than half a million seniors from its plans next year, the second consecutive year of similar reductions, while UnitedHealth cut about the same number of plans and individuals. The insurers are trimming plans that are not cost-effective and reducing some benefits as enrollment has ballooned to roughly 35 million people, up from 24 million six years ago, covering about 55% of Medicare-eligible individuals. The cuts are concentrated primarily in rural areas, with Wyoming, North Dakota, South Dakota, New Hampshire, and Vermont hit hardest.
UnitedHealth Group Raises Dividend and Exits Medicare Advantage Plans
UnitedHealth Group's board authorized a cash dividend of US$2.32 per share payable September 22, 2026, while outlining further exits from certain Medicare Advantage plans and updated margin expectations. The company plans to exit plans covering more than 600,000 members and expects a 1.1 million enrollment decline by 2026, targeting Medicare margins above 3%. Management also raised its 2026 adjusted EPS outlook, supported by lower medical costs. The company projects $498.6 billion revenue and $23.5 billion earnings by 2029, requiring 3.5% yearly revenue growth and a roughly $9.4 billion earnings increase from $14.1 billion today.
UnitedHealth faces shareholder suit over governance failures
UnitedHealth Group is facing an amended shareholder lawsuit accusing the insurer of knowing about serious governance issues and doing little to ensure compliance, leading to significant losses in stock value. The suit was filed in a Minnesota federal court by the Employees’ Retirement System of the State of Rhode Island and Länsförsäkringar Fondförvaltning AB, a Swedish asset manager. Plaintiffs blame the board and senior company officers, alleging the company built its industry-leading earnings on a foundation of systemic wrongdoing and illegality, including defrauding the federal Medicare program, denying medically necessary care, deceiving a federal court, violating patient privacy laws, unlawfully suppressing competition, and manipulating earnings. The suit contends that defendants issued false and misleading statements in SEC filings, on earnings calls, and in four successive proxy statements, keeping the stock trading at artificially inflated prices while the company repurchased billions of dollars of its own shares. UnitedHealth reached an all-time closing high of $599.78 on November 11, 2024, and closed Wednesday at $405.59, after closing as low as $259.02 on March 27 of this year.
Humana Partners With HealthStream to Boost Indiana Home-Care Workforce
Humana's Medicaid managed care plan, Humana Healthy Horizons, is teaming up with HealthStream in Indiana to strengthen the state's home-care workforce. Under the initiative, Humana is sponsoring 1,000 Home Health Aide scholarships to help remove financial barriers for people entering the caregiving field. The program uses HealthStream's Career Network to reach rural and underserved communities, and Humana is also deploying HealthStream's CoachUp Care platform, predictive analytics and training tools to help providers recruit and retain caregivers. The collaboration targets high caregiver turnover, as home-care providers have an average annual turnover rate of 77%, while Humana says trained home-care aides are more than twice as likely to remain employed after three months and 64% more likely to stay after six months than workers without comparable training. Early results show 81% of participating providers achieving above-average caregiver retention, with providers that improved retention reporting an average 43% increase.
HUM · Demand · Positive Humana sponsors 1,000 scholarships and deploys training tools to improve caregiver retention, directly benefiting its Medicaid plan.
HSTM · Demand · Positive HealthStream's Career Network and CoachUp Care platform are used in Humana's initiative, expanding its services and market reach.
Molina Healthcare Surged on Medicaid Clarity and Robust Results
Molina Healthcare was the top contributor to Sycamore Mid Cap Value Equity Strategy in the second quarter of 2026, according to the fund's investor letter. The managed care company's shares rallied after a strong first-quarter earnings report refocused investor attention on its core government-sponsored plan business, signaling that the worst of the medical cost ratio deterioration was likely behind it. Shares also benefited from greater visibility into the timing and scale of Medicaid spending cuts under the One Big Beautiful Bill Act, and got another lift late in the quarter when CMS released 2025 risk-adjustment transfer data viewed favorably for managed care companies. On August 12, 2026, Molina Healthcare closed at $206.06 per share, reflecting a market capitalization of $10.76 billion and a year-to-date gain of 20.40%.
UnitedHealth's Lower Medical Costs Drive Earnings Recovery
UnitedHealth Group reported second-quarter results showing its medical care ratio fell to 86.7% from 89.4% a year ago, helping operating earnings rise 55% and prompting the company to raise its 2026 adjusted EPS guidance. The quarter included $860 million of favorable prior-period medical development, while commercial medical costs are increasing at a rate exceeding 11% due to higher provider billing and coding intensity and specialty drug costs. Elevance Health's second-quarter benefit expense ratio was 89.7%, up 80 basis points year over year, but the company raised its 2026 adjusted EPS guidance to at least $27. CVS Health's Aetna business benefited from lower medical costs in the second quarter, leading to an earnings beat and raised 2026 adjusted EPS guidance of $7.90 to $8.10. UnitedHealth shares have risen 47.9% in the past 12 months, and the stock trades at a forward price-to-earnings ratio of 18.83X compared with the industry average of 16.48X.
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