CVS Health chops 2024 forecast as cost struggles with Medicare Advantage persist
CVS Health missed first-quarter expectations and chopped its 2024 outlook more than a dollar below Wall Street’s forecast.
Shares of the health care giant plunged Wednesday after the company said it was still struggling with rising costs from care use in its Medicare Advantage business.
Company leaders told analysts they were still dealing with rising use from outpatient care and in supplemental benefits. The company also saw some new pressure from inpatient care.
CEO Karen Lynch said the company’s visibility into trends during the quarter was impaired by the cyberattack on Change Healthcare, which is operated by rival UnitedHealth Group. Change provides provides technology used to submit and process insurance claims for several insurers.
CVS Health had already scaled back 2024 expectations earlier this year as it worked to understand why costs keep rising from Medicare Advantage, the privately run version of Medicare, the government’s program which is for people age 65 and older.