Centene's Q4 2024: Key Contradictions in Medicaid Rates, Part D Margins, and Exchange Membership

These are the key contradictions discussed in Centene's latest 2024 Q4 earnings call, specifically including: Medicaid rate and cost trend expectations, Part D business margins, and exchange membership expectations:



Revenue and Earnings Guidance Increase:
- Centene Corporation reported an increase in full-year 2025 revenue guidance by $4 billion, leading to an expected range of $158 million to $160 billion in premium and service revenue.
- The increase is attributed to improved results during the Medicare annual enrollment period and a program expansion in Medicaid.

Medicaid Membership and Rate Adjustments:
- Centene serves 13 million Americans across its Medicaid portfolio, with expected Medicaid membership stability and a gradual return to equilibrium in rates and risk profile.
- The company achieved mid-4% composite rate adjustments for the 1125 cohort, attributed to constructive dialogue with state partners and data-driven rate negotiations.

Medicare Segment Performance:
- The Medicare segment showed notable advancements with 55% of members associated with 3.5 star plans or better, up from 23% last year.
- This improvement is due to better execution and administrative process improvements, which are expected to support future STARs results.

Marketplace Membership Growth:
- Ambetter effectuated enrollment reached a little stronger than expected in January, with a projected peak membership during Q1 slightly above 5 million.
- This growth was attributed to strong member retention and strategic product positioning, with the demographic showing a higher proportion of female members and an average age of 39.4 years.