Robbins LLP is Investigating Allegations that Elevance Health, Inc. (ELV) Failed to Disclose the Impact Medicaid Redetermination Would Have on its Business Prospects

Robbins LLP informs stockholders that a class action was filed on behalf of all purchasers of Elevance Health, Inc. (NYSE: ELV) common stock between April 18, 2024 and October 16, 2024. Elevance is a healthcare company that, among other things, provides health insurance plans to a variety of markets.

The Allegations

According to the complaint, during the class period, defendants represented to investors that they were closely monitoring cost trends associated with the Medicaid redetermination process and that the premium rates Elevance was negotiating with states were sufficient to address the risk and cost profiles of those patients staying on Medicaid programs.  While Defendants acknowledged that Medicaid expenses were rising, they repeatedly assured investors that this was adequately reflected in the Company’s guidance for the year.  Defendants further reassured investors that “we’re intentionally remaining thoughtful and prudent in our outlook,” and that, while the Company was seeing an acuity mix shift in the Medicaid business, it was “nothing outside of the bounds of what we’ve expected and guided for.” 

In truth, the redeterminations were causing the acuity and utilization of Elevance’s Medicaid members to rise significantly, as sicker patients with higher acuity tended to remain on Medicaid after redetermination, leading to higher per-patient costs. This shift was occurring to a degree that was not reflected in Elevance’s rate negotiations with the states or in its financial guidance for 2024. 

On July 17, 2024, the Company revealed that it was now “expecting second-half utilization to increase in Medicaid” and that it was “seeing signs of increased utilization across the broader Medicaid population, including in outpatient home health, radiology, durable medical equipment, as well as some elective procedures.”  In response to these disclosures, the price of Elevance common stock declined by $32.21 per share, or 5.8%, from a closing price of $553.14 on July 16, 2024, to a closing price of $520.93 on July 17, 2024. 

What Now: You may be eligible to participate in the class action against Elevance Health, Inc. Shareholders who want to serve as lead plaintiff for the class are required to file their papers with the court by July 11, 2025. The lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation.  You do not have to participate in the case to be eligible for a recovery. If you choose to take no action, you can remain an absent class member.