Health Plan Weekly

CVS Health Corp.-owned Aetna plans to exit the Affordable Care Act exchange business in 2026, citing poor performance in the segment. Thomas Cowhey, CVS’s chief financial officer, said during the company’s first-quarter earnings call on May 1 that Aetna projects to lose between $350 million and $400 million this year in the exchange business.  

Aetna has more than 1.6 million exchange members, according to AIS’s Directory of Health Plans, making it the second-largest insurer in the segment behind Centene Corp., which has more than 4.3 million exchange lives. Aetna had previously departed the exchange market in 2018 during President Donald Trump’s first term before reentering it in 2022 when President Joe Biden was in office.  

CVS Health Corp. beat analysts’ expectations during the first quarter thanks in large part to the Aetna health insurance subsidiary, which has performed better this year compared with a year ago when the company had high utilization and mispriced many of its Medicare Advantage plans. While Aetna has continued to struggle in the Affordable Care Act exchange business and plans to exit the segment in 2026, it has modestly improved in the other lines of business. 

As such, CVS increased its adjusted earnings per share (EPS) guidance to $6.00 to $6.25 this year, up from its previous guidance of $5.75 to $6.00 and higher than last year’s $5.42. Thomas Cowhey, CVS’s chief financial officer, said during the company’s first quarter earnings call on May 1 that the updated guidance “incorporates our first quarter performance while maintaining a respectful view on medical cost trend and a prudent outlook on various macro factors for the remainder of the year.” 

After reporting first-quarter results that exceeded company and analyst expectations, The Cigna Group increased its full-year adjusted earnings per share (EPS) guidance to at least $29.60, up from at least $29.50. The company kept its medical loss ratio (MLR) guidance at between 83.2% and 84.2%.  

“This outlook reflects confidence in our businesses, while maintaining a prudent view of the current environment,” Cigna Chief Financial Officer Ann Dennison told analysts on a May 2 conference call. 

For the first quarter, Cigna had adjusted EPS of $6.74, up from the $6.35 Wall Street consensus estimate and from $6.47 during the same time period last year. Meanwhile, the company had $65.5 billion of revenue, significantly above the $60.7 billion consensus. The Cigna Healthcare insurance segment generated more than $14.4 billion of revenue for the quarter, a 9.1% increase from last year, while the Evernorth health services segment had nearly $53.7 billion of revenue, a 16.1% increase from last year.  

Continuing a trend of avoiding the Medicare Advantage pitfalls that dogged UnitedHealth Group’s first-quarter earnings, Humana Inc. on April 30 reported results that indicated it is keeping MA costs under control. Still, uncertainty about the outcome of Star Ratings litigation gave some investors pause. 

During the company’s conference call to discuss first-quarter financial results, “we were pleased to see management reiterate guidance on what appears to be a benign Medicare Advantage cost environment relative to expectations,” RBC Capital Markets’ Ben Hendrix advised investors. “We were particularly pleased to hear that…completed claims through February and significant data through April suggest that trends are remaining in line with initial guidance.” 

Covered California, the state’s Affordable Care Act exchange, disclosed on April 28 that it inadvertently shared sensitive consumer data with LinkedIn. The exchange explained that it uses LinkedIn tools like LinkedIn Insight tags — pieces of code added to a website to track how visitors interact with the site — to “better understand consumer behavior and deliver tailored messages to help consumers make informed decisions about their health care options.” But Covered California said it discovered that the tags inadvertently collected some sensitive data from consumers, including first names, the last four digits of Social Security numbers, and other sensitive health information such as pregnancy status. “To our knowledge, access to this data was limited to Covered California credentialed users for the limited purpose of managing Covered California’s account,” the exchange said. But Covered California added that it is “reviewing its entire website and information security and privacy protocols to ensure that no analytics tools are impermissibly collecting or sharing sensitive consumer information.” The exchange also noted that all active advertising-related tags across the CoveredCA.com website have been turned off, as a precautionary measure.