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Good morning, and welcome to the Centene Corporation Second Quarter Earnings Conference Call. [Operator Instructions] Please note, today's event is being recorded. I would now like to turn the conference over to Jennifer Gilligan, Senior Vice President, Finance and Investor Relations. Please go ahead, ma'am.

Thank you, Rocco, and good morning, everyone. Thank you for joining us on our Second Quarter 2025 Earnings Results Conference Call. Sarah London, Chief Executive Officer; and Drew Asher, Executive Vice President and Chief Financial Officer of Centene, will host this morning's call, which also can be accessed through our website at centene.com. Any remarks that Centene may make about future expectations, plans and prospects constitute forward-looking statements for the purpose of the safe harbor provision under the Private Securities Litigation Reform Act of 1995. Specifically, our discussion today of our expectations for the drivers of adjusted EPS for 2025 and any commentary on expected adjusted EPS for 2025 are forward- looking statements. Actual results may differ materially from those indicated by those forward-looking statements as a result of various important factors, including those discussed in our second quarter 2025 press release, Centene's most recent Form 10-Q filed this morning, and its 10-K filed on February 18, 2025, and other public SEC filings, which are available on the company's website under the Investors section. Centene anticipates that subsequent events and developments may cause its estimates to change. While the company may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. The call will also refer to certain non-GAAP measures. A reconciliation of these measures with the most directly comparable GAAP measures can be found in our second quarter 2025 press release. We are unable to reconcile our commentary on expected adjusted EPS for 2025 to the corresponding GAAP measures due to the difficulty of predicting the timing and amounts of various items within a reasonable range. Finally, following the call, the team's prepared remarks will be posted on the Investors section of our website. With that, I would like to turn the call over to our CEO, Sarah London. Sarah?

Thanks, Jen, and thanks, everyone, for joining us. We have a lot to cover this morning, so let me start by outlining a few key elements in my prepared remarks. First, I'll provide more detail on the Marketplace risk adjustment challenge we previewed earlier this month, including what happened and what actions we're taking to mitigate the financial impact with an eye to restoring the book to profitability in 2026. Second, I will address the elevated medical cost trend that drove our higher Q2 Medicaid HBR results, how we are addressing it and an updated view on the positive progression of Medicaid rates. Third, I'll review our updated outlook for 2025. And finally, I'll share our perspective on how the policy landscape in the wake of the One Big Beautiful Bill Act or OB3, and how that informs our view of 2026 and beyond. Before we jump in, let's level-set with what we printed this morning. We reported second quarter results for 2025, inclusive of an adjusted per share loss of $0.16. We are disappointed by this performance and frustrated to have fallen short of the financial goals we set at the start of the year. Our primary focus is restoration of our earnings trajectory, and the entire team is unified behind that goal, operating with a sense of urgency and discipline as we work to improve performance across the portfolio and drive results that will generate tangible shareholder returns. As you will hear, we are aggressively taking actions to put our Marketplace business on a path to recovery and enhanced profitability for 2026. In Medicaid, we have clear line of sight into what is driving our trends, and we are actively pulling the levers necessary to correct our trajectory. And finally, our Medicare Advantage business is achieving significant operational progress, paving our path to breakeven in 2027 and profitability in the years to follow. With that, let's dig in, beginning with Marketplace. We reported second quarter Marketplace membership of 5.9 million members as the book continued to grow, driving more than $10 billion of commercial premium and service revenue in the period. Revenue in the quarter was negatively impacted by the previously disclosed shortfall in projected 2025 risk adjustment transfer revenue, generating a drag of approximately $1.2 billion in pretax for the segment. In addition to the risk adjustment challenge, the underlying performance of our Marketplace business was impacted by higher levels of utilization. We have incorporated this elevated utilization into our full year 2025 outlook, which we will address in a few moments. Now let's talk about the risk adjustment challenge in a bit more detail. On July 1, we announced that, with information on approximately 72% of our membership, we were tracking to earnings pressure of $1.8 billion in 2025 as a result of a change in Marketplace risk adjustment transfer assumptions. This was based on data from Wakely, an independent actuarial firm that aggregates market growth and morbidity information on behalf of carriers on the individual marketplace. Since this announcement, we have received our additional files and spent meaningful time reviewing the findings. Based on the complete data set, we now expect full year 2025 Marketplace earnings to be pressured by $2.4 billion, which represents 100% of the membership impact. Analysis of the full data confirmed a significant shift in the marketplace risk pool in 2025, which we now believe is primarily being driven by 3 things. First, a higher-than-expected percentage of healthy and/or low utilizing members left the marketplace during open enrollment, which was likely the result of program integrity measures that were introduced after 2024 pricing was finalized and implemented for the 2025 open enrollment cycle. Second, new sign-ups to the market had higher morbidity, likely reflecting changes in the underlying member mix from redeterminations and the same program integrity guardrails deterring new healthy sign-ups in 2025. And third, a step-up in Marketplace utilization more broadly, combined with more aggressive provider coding, is likely driving higher in-year documented morbidity. Together, these dynamics have shifted the morbidity of the market in some states as much as 16% to 17% year-over-year. Ultimately, Ambetter was underpriced for this morbidity shift. As a result, we now expect the product to run slightly below breakeven for the remainder of 2025 instead of within our target margin range of 5% to 7.5%. This is obviously a disappointing outcome, but we are not taking it standing still. We immediately turned our focus to mitigating the impact of this pricing miss with the goal of returning the business to profitability in 2026. As of this morning, we have already filed 2026 pricing in 17 states. We expect to submit adjusted pricing files in up to 12 additional states within the next week and anticipate state certification of rates over the next months. Based on what we know today, we continue to believe that we will be able to reprice the 2026 portfolio to account for a substantial majority of our Marketplace membership, and our goal is to reprice 100% of the book. Importantly, our 2026 pricing adjustments account for the morbidity shifts we observed in the 2025 data, but they also account for shifts we now expect to see in certain markets in 2026, informed by the scale of our data and our unique ability to see correlations across the 29-state footprint. As a reminder, initial 2026 pricing was already set to current law of the land, which means we have accounted for the potential expiration of eAPTCs. In addition to addressing pricing, we are actively looking at ways to leverage our position in the market to create more transparency around market dynamics earlier in the year. We are also engaged with the administration as they prepare to implement the next wave of program integrity measures to ensure the mechanics for open enrollment 2026, both achieve their goals and ensure that eligible members can readily access high-quality, affordable health insurance on the federal exchange. While the individual marketplace will be absorbing the impact of regulatory changes for at least one more cycle, it does not change the fact that millions of Americans rely on this critical infrastructure to access health care coverage. We remain committed to supporting our almost 6 million members in getting the care they need to keep themselves and their families healthy. And as we do so, we are focused on returning our marketplace portfolio to profitability in the short term and sustainable profitable growth over the long term. Turning to Medicaid. Our Medicaid portfolio also fell short of expectations in the second quarter, producing an unanticipated and unacceptable health benefits ratio of 94.9%. Driving this underperformance was a step-up in medical cost trend in 3 areas: behavioral health; home health; and high-cost drugs. Behavioral health was the most significant driver of the quarter-over-quarter increase with ABA, or applied behavioral analysis, as an accelerating pressure point across a number of our markets. In response, we have formed enterprise-wide behavioral health and ABA task forces to further support our markets in aggressively managing this trend. Together, they are focused on aligning members to high-quality providers, educating state partners around evidence-based clinical guidelines, advocating for behavioral health specific rate adjustments and rooting out fraud, waste and abuse in service of better member outcomes. Within the underlying ABA trend, the largest concentration of pressure was isolated to a single program in a single state. As a reminder, earlier this year, we inherited the ABA population in Florida within the Children's Medical Services contract, for which we are the sole source provider. That population transitioned with inadequate rates, and with the continuity of care provision, limiting the use of managed care strategies to effectively manage services and associated costs. This provision lifted as of June 1, and we are already seeing the impact of clinical and administrative interventions. At the same time, we are also advocating with our state partner to address the underlying rate gap, both retroactively and prospectively. Home health was the next largest contributor to trend across markets in Q2 with home and community-based services, or HCBS, related to complex populations as the top driver. Here too, we are leveraging a cross-enterprise approach to select high-quality and high-integrity providers in this space and ensure states have sufficient data to inform both rate and policy decisions. We saw HCBS pressure manifest in an outsized way in New York in Q2 due to rate insufficiency and state-driven program changes. As we saw this emerge, we deployed additional leadership resources to the New York market and are executing against a very clear road map to correct the overall trajectory, which is showing good progress as we move into Q3. ICOS drugs were the final driver of the Q2 step-ups, with cancer drugs and gene therapies among the major categories contributing pressure. In addition to working with our partners to ensure clinical appropriateness for these treatments, we have also been ramping up efforts to educate our states on a sustainable cost containment, including through corridors or carve-outs. This is another place where the benefit of a 30-state Medicaid footprint means we can readily source best practices to inform solutions. And we are seeing states moving more quickly to make policy and program changes to better regulate this cost driver. In addition to pulling these more direct levers, we are hyper-focused on securing rates that reflect current trends in order to deliver meaningful margin improvement for the Medicaid business. As a reminder, 88% of our Medicaid franchise gets rerated between 7/1/25 and 1/126. Over the last 18 months, we have demonstrated the ability to secure outsized rate increases and engage constructively with our state partners to infuse more real-time data into the process. We are activating that same playbook in light of this recent step-up in trend to push for faster rate correction. Our 7/1 and 9/1 rates have materialized better than our previous expectation, and we now expect a 2025 composite rate adjustment of 5% compared to 2024. This is stronger than the previous expectation of 4% plus. We have important rate updates upcoming in our 10/1 states, including Florida, and we are already feeding current trend data to those states who will update rates 1/1/26 for 40% of our membership. Despite the current dislocation, we remain confident in our ability to secure rates that are sufficient to address the current acuity and health care demand within the Medicaid population and support sustainable margins over the long term. Turning to Medicare. PDP membership ended the quarter at 7.8 million members, roughly flat on a sequential basis. Our performance in this product exceeded our expectation in the period, allowing us to improve our outlook for full year results in PDP. The PDP program absorbed a number of regulatory changes in 2025, and with half the year behind us, we are now more comfortable with the assumptions we made around the impact of some of these changes. While our outlook for the product remains prudent, PDP is providing some earnings upside relative to our previous outlook. Meanwhile, Medicare Advantage is making important progress on its path to margin recovery, thanks to effective 2025 pricing, an optimized footprint and continued operating discipline. To date, the book is running slightly favorable to expectations, and we continue to closely monitor components of costs, such as outpatient surgery and pharmacy to ensure that we appropriately manage any evolving pressure. Relative to STARS, we are pleased with our continued performance improvements across multiple categories and particularly with gains we have seen in our clinical measures for members with chronic illnesses. We are still waiting for CAPS results and final cut points from CMS, but based on the data we have today, we still anticipate year-over-year progress in STARS. But challenging cut points may make our 85% target difficult to hit. As a reminder, we anticipated cut point headwinds coming into 2025 and have built a path to our 2027 breakeven target that does not rely on further STARS improvement. Based on our performance in 2025 to date, as well as the advancements we have made and expect to continue to make relative to clinical interventions, SG&A and value-based care, we feel good about our path to break even in 2027 for Medicare Advantage and are pleased with the consistent progress we are making turning around this business. As we think about the road ahead, our current forecast calls for full year adjusted diluted EPS of approximately $1.75. The following 6 items can help you bridge from our previous full year 2025 adjusted EPS guidance of $7.25, representing $4.55 billion of pretax to the $1.75. One, as I mentioned earlier, we now estimate that the Marketplace morbidity shifts relative to our previous 2025 forecasts will create a $2.4 billion full year headwind to the 2025 pretax earnings. Two, also in Marketplace, we have built in an additional $200 million in pretax margin pressure from expected back-half utilization, including the impact of members seeking care in advance of the expiration of eAPTCs. Three, in Medicaid, we reflected the rate increases we know for 7/1 and 9/1 but have been balanced about our assumptions for the 10/1 cohort. Four, we have also assumed that we will continue to have trend pressure in the back half of the year such that the Medicaid HBR in the second half is approximately 93.5. The overall change in full year Medicaid HBR represents an approximate $2.1 billion headwind on pretax earnings compared to our prior forecast. Five, we expect the Medicare segment to deliver approximately $700 million in pretax favorability in our -- compared to our prior forecast, largely driven by PDP but supported by better Medicare Advantage results as well. Embedded in this $700 million is the expectation of continued specialty trend in PDP and slight outpatient pressure in MA. And finally, through continued aggressive SG&A management and natural leverage on growth, we expect to deliver an approximate net $500 million in pretax earnings in the buildup to $1.75 compared to our prior forecast. As we think about variation to that forecast, we believe the largest swing factor that could pressure the $1.75 would be a further acceleration of Medicaid trend in the back half of the year. To frame the downside for you, if we made no progress on HBR in the back half of the year compared to the first half, that could push the $1.75 as low as $1.25. With respect to upside to $1.75, we have tangible momentum in Medicaid on rate updates and policy changes, progress on clinical interventions and network design and increasingly effective initiatives to stamp out fraud, waste and abuse. The impact of that work could lead us to a better result than 93.5% in the back half of the year. And as a reminder, every 10 basis points of back half HBR improvement is $45 million in pretax. In Marketplace, we will get updated market morbidity data at the end of September and December, which could indicate we don't need the full $2.4 billion change in the Marketplace forecast. As the next few months progress, we will also have a better view on whether the additional $200 million provision for Marketplace trends was necessary. And finally, we will continue to pursue strategic SG&A opportunities as we look to rightsize the business for 2026. All of these factors could drive results higher than $1.75. There are a number of very near-term milestones that will better inform our view of the full year outlook, including July and August results, 10/1 rate updates and the next tranche of Wakely data, all of which are expected by the end of September. We look forward to providing updates on our outlook as we gain additional visibility into these key inputs. With that, let me take a moment to talk about 2026. We fully expect to deliver margin improvement in our 3 core lines of business in 2026 relative to the current 2025 forecast. Let's dig into that in more detail. We believe we are on track to reprice our Marketplace business for meaningful margin improvement in 2026. While the last month has been incredibly challenging for this business, the team has far more clarity on the trend and market morbidity dynamics of 2025 as well as the insights embedded in that data that foreshadow 2026 dynamics. We have integrated this view into our 2026 refiling decisions and are making excellent progress against our goal to reprice 100% of the Marketplace book. In Medicaid, we now have far more transparency about the drivers of cost and trend across our portfolio and are in command of the levers to correct our HBR trajectory as we head into 2026 and beyond. With 88% of the book rerating over the next 6 months, momentum around policy changes and enterprise-aligned execution on key initiatives, we are confident we can meaningfully move the Medicaid HBR in the right direction over the next 12 to 18 months. And finally, armed with strong rates and operating discipline, our Medicare Advantage business will continue to make solid progress in 2026 on its path to breakeven in 2027. Our industry is always evolving, and it is our job as a business to evolve with it. We have spent the last 3 years fortifying our platform. And over the coming months, we will pressure-test each of our markets for the future conditions necessary to support sustainable, profitable growth. We will harvest additional synergies across the platform, lean harder into places we can leverage our unique size and scale and work to ensure we have the strongest and most resilient platform to support the new normal that lies ahead. To that end, a comment on the policy and legislative landscape. We view OB3 as having established a new and stable policy floor for our programs, and we are actively developing a multiyear implementation strategy. Many of the Medicaid provisions include runway for implementation, allowing us to leverage the strong partnerships we have at the state level to help maximize the impact of taxpayer dollars and maximize coverage for vulnerable members. On the Marketplace side, as you heard, we have the benefit of an early look at program integrity impacts and are baking that into our revised 2026 pricing. While we expect to see a contraction of the individual market heading into 2026, regardless of what happens with eAPTCs, just on the other side of that is a more stable market for individual and family coverage. Medicare likely has another wave of policy changes coming from CMS aimed at maximizing efficiency and integrity across the program, and we are tracking those closely as we build back that business. This clarity allows us to firmly plan for the future. And our confidence in the staying power of Medicaid, Medicare and the individual marketplace is as strong as it has ever been. By staying focused and delivering on our mission of transforming the health of the communities we serve one person at a time, we believe we can command a durable, differentiated position in a key market and deliver meaningful value to our members, our stakeholders and our shareholders. With that, let me turn it over to Drew for some additional detail on the financial results.

Thank you, Sarah. Today, we reported second quarter 2025 results, including $42.5 billion in premium and service revenue, and a disappointing adjusted diluted loss per share of $0.16. Let me build on what Sarah covered regarding what happened and, more importantly, what actions we are taking. Let's start with Marketplace, where Sarah covered a lot of ground. So let me give you a click deeper into one of the primary drivers observed in the data we received in late June and then tie that to the relevance for refiling 2026 rates. We have found a high correlation between increasing 2025 morbidity in a given geography and the degree to which there is disruption in the 2 low-cost silver plans from 2024 to 2025 and whether or not that geography was in a state-based exchange or federal exchange for those 2 years. In other words, where there was a change in the 2 low-cost silver plans in the federally-facilitated exchange, which would require the member to take an action in order to maintain a $0 premium, we believe the 2025 program integrity provisions, such as a 3-way call with CMS or social security verification, negatively shifted the risk and disproportionately reduced 0 or low utilizers from the market in 2025. This same phenomenon appears to have also reduced the entry of similar new members across all federally facilitated exchange, or FFE, markets compared to 2024. As Sarah mentioned, the morbidity increase was up as much as 17% in states with significant low- cost Silver disruption. Conversely, in an FFE geography with no disruptions in the 2 low-cost Silver plans, the members could auto- renew with their carrier for 2025 without much of a hassle. Why is this important? Because based on what we can see across our 29-state footprint, we can form an expectation of what degree of morbidity lift may be coming in 2026 when all members will have to go through the new program integrity steps and validations to ensure eligibility for 2026 Marketplace. This has meaningfully influenced our 2026 pricing approach that Sarah described. As of this morning, we have submitted 17 refilings and expect to wrap up the remaining states in the next week or so, with the approval process expected in August. As we sit here today, we expect to make meaningful upward 2026 rate adjustments reflecting this data across our Marketplace footprint. In Medicaid, Sarah covered the trend drivers, including the acceleration of behavioral health, especially ABA and other related counseling therapies in Q2. We are working with state partners to get rates corrected for this and, in some cases, push for retro premium adjustments for program changes such as Florida Children's Medical Service where we are the sole source carrier and where there are inadequate risk adjustment mechanisms such as in New York. In addition to the 7/1 and 9/1 positive rate updates Sarah provided, we are working with our state partners to drive policy improvements across a number of states. One example being pharmacy management responsibility returning to the Medicaid plans in one of our states in the fourth quarter, which will allow us to directly manage the cost. We're also executing on initiatives designed to keep health care affordable, including clinical interventions, payment integrity and choosing the right network partners. Let me go a little bit deeper on PDP as a follow-up from the Q1 call. Now that we have 2 quarters of PDP data, we can better forecast the trends for the remainder of the year. Even though we still see very high specialty pharmacy trends in our non-low income cohort, we are into the 90% CMS, 10% payer part of the risk corridor. This should provide us with earnings protection and reasonable predictability, though we will continue to build a receivable from CMS, which will be increasingly visible in our cash flows in the back half of the year. And as Sarah mentioned, our Medicare Advantage business is ahead for 2025 and on track for our goal to breakeven in 2027. Moving to consolidated enterprise topics. Cash flow provided by operations was $1.8 billion for Q2, primarily driven by improved timing on pharmacy rebate remittances. Unregulated cash on hand at quarter-end was $234 million. We do not have any further 2025 share buyback in our current forecast, but we'll remain open to opportunistic buybacks as we continually assess market conditions and changes in our cash positions. Our medical claims liability at quarter-end represents 47 days in claims payable, a decrease of 2 days as compared to the first quarter of 2025, driven by the timing and types of claims as well as the impact of state-directed payments. And as a reminder, 2025 DCP is structurally lower than 2024 DCP due to our PDP revenue increase resulting from the Inflation Reduction Act and the speed at which pharmacy claims complete compared to medical claims. Moving to our outlook for 2025. With the visibility we gained in Q2, we pressure-tested each business, operational measures, trend drivers and SG&A. The result is a forecast that equals $1.75 per diluted share of adjusted earnings with swing factors on both sides, as Sarah laid out. A few more miscellaneous items that might answer a couple of questions in advance. One, we expect our full year adjusted tax rate in our forecast to be around 19%, which could vary depending on the actual level of pretax earnings. Two, given our market cap change, coupled with the passing of the OB3 in July, we will be going through a goodwill evaluation and test in the third quarter, which prevents us from being able to reconcile prospective adjusted EPS elements to a GAAP equivalent. And three, our premium and service revenue outlook for 2025 has increased to approximately $172 billion, including approximately $89 billion in our Medicaid segment, $41 billion in our Commercial segment, $37 billion in the Medicare segment and $5 billion in Other. There is substantial future earnings power in this revenue base. Coming back to the big picture. There's a real opportunity to make meaningful margin improvements, and these are good long-term businesses. Yes, we have to navigate a major unanticipated shift in the marketplace risk pool in 2025, as well as the dislocation between Medicaid rates and underlying medical costs plus regulatory changes in 2026 and beyond. But these are important and relevant long-term businesses critical to serve and provide value to economically-challenged and medically-complex members and our government partners. This is fixable. We look forward to demonstrating improvements ahead. Thank you for your interest in Centene. And Rocco, please open it up for questions.

[Operator Instructions] Today's first question comes from Josh Raskin at Nephron.

I'm sure there'll be a lot on the operation. So I'm going to ask if you could walk us through your capital position, sort of the amount of capital that you think you'll be adding to your subsidiaries in the second half? And maybe how you're thinking about any potential needs for additional capital, whether that's debt or equity, through the rest of the year?

Yes. Thanks, Josh. We have a very thoughtful plan on that. So I will let Drew walk through a couple of those items.

Yes. You'll see this in the Q, Josh. We think we'll need to put a net $300 million into our subs in the back half of the year. That's net of dividends that we still expect. Obviously, those dividends will be at a lower level than previously expected. But stepping back to the big picture, you may recall that in the first quarter, we renewed our credit facility and we doubled the size of that. So it's a $4 billion credit facility. We had 0 drawn at June 30. And there's only one covenant in there, which is a 60% debt to cap, and we're currently about 39%. So we've got quite a bit of runway for capital and look forward to improving the operation and generating a higher level of earnings in 2026.

And our next question today comes from A.J. Rice at UBS.

Just might try to drill down on some of your comments around the public exchanges. First, on the risk adjustment true-up or miss, whatever you want to call it. You're such a big part of the market. You were seeing some of these program integrity impacts as well as the underlying trend step-up. You -- is the right interpretation you thought those were applying to you, but not to the broader market, and therefore, it's only now that you're adjusting your expectations around the true-up? And then broadly about next year, I know the repricing of 100% of the book. Can you just update us on your thought about what are you repricing to? What is the updated thought on target margins for the exchange and the environment we're going to see next year. And is there any way to comment on what that might mean for disenrollment from the exchanges? Maybe if not specifically for you, for the broad market, what are you assuming?

Yes. Thanks, A.J. A lot of good questions in there. So thinking about open enrollment 2025 we -- I think one of the important factors in terms of assumptions is looking at new member sign-ups and then the effectuation rate. As we came through that process, we saw very strong effectuation rates, very consistent with what we had seen in the past. And while we were certainly aware of the program integrity measures as a net grower in the market, I think it was not necessarily as clear to us that there were a lot of low or non- utilizing members that were being shifted out of the market, and that is a result of those program integrity measures. And as Drew said, in some of those markets where the more members had to shop because of the low-cost Silver position, more members then were put through those program integrity filters and left the market. So I think having the full view of the market data, what we're really operating on up until that first set of Wakely data is our own information. But having the full view and understanding that I think a number of other carriers probably shed members, and instead of those members going to other carriers, they actually left the market. And that's really what drove a significant morbidity shift, again, average 8% to 9% across the market. As we think about repricing, it's the point that Drew made in some of those insights and sort of the signal in the noise of the '25 data is really, really important, and understanding that the impact of the morbidity shift was actually different market by market. And being able to see 29 markets and understand the different cohorts allows us to understand that there are some markets that didn't actually go through that full impact in 2025, but will go through that impact in 2026 when the program integrity measures that are being put in place will be applied ubiquitously. So keeping that in mind, those are baked into our assumptions for refiling for 2026. We obviously are expecting to improve profitability in the book for 2026, but we won't be able to comment on target margins until we see a little bit more of the full landscape, which will come in the MA file in September. So stay tuned on that. Relative to disenrollments for 2026 and sort of overall market contraction, again, the commentary on what we saw in those markets that were most disrupted in 2025, I think, are really not just a foreshadowing of what's going to happen in 2026. But I actually think what we experienced in 2025 was, in some ways, a pull forward of the impact that we would have otherwise expected in 2026, which means that we have already absorbed some of the market contraction that we would have otherwise estimated for 2026. So again, also baking that into our assumptions, pricing based on an expectation of law of the land. So accounting for the fact that enhanced APTCs would expire. And again, all of that is sort of being put into the refilings and the additional pricing that we have submitted. And I think, again, making very good progress on that. The states have been very receptive digesting the data. And we believe we've got a path to reprice 100% of the Marketplace book for profitability in '26.

And our next question today comes from Justin Lake at Wolfe Research.

First, just a quick follow-up from your answer to Josh's question. I think I heard Drew say that you expect to generate higher earnings in 2026. Just wanted to confirm that and any color. And then my question is on Medicaid. Your guidance for the second half of the year implies 140 basis points of improvement from the 94.9 you reported in 2Q. It's fairly differentiated in terms of the slope versus your 2 peers who are actually assuming Medicaid deteriorates from the second half versus Q2. So I'm just curious, Drew, is there anything in your second quarter reported MLRs, such as negative intra-year development that might make it the wrong jump-off point, or anything else we should consider in terms of 2Q versus the back half that might be different versus your peers?

Yes. Thanks, Justin. So both Drew and I talked about the fact that we expect to deliver margin improvement in all 3 lines of business in 2026 and, therefore, earnings improvement. So obviously, too early to talk about guidance for 2026, but we've talked about sort of the progress that we expect to make in each of the lines of business. Let me talk about Medicaid specifically because that's obviously a big piece of it, and break down sort of what we saw in Q2 a little bit more and how that relates to how we think about the back half of the year. So obviously, not pleased with the 94.9. But if we break it down a little bit more, as I said, what drove that was an acceleration of trend in the quarter in those 3 areas. So behavioral health, which is about 50%, with ABA as sort of a primary driver underneath that. Home health is about 30% of the total. Again, HCBS is sort of the big category, and then high cost drugs was the rest. Important to note that we aren't seeing broad-based trends. So inpatient looks fine, ED looks fine, PCP is right on track. We also saw a concentration of that trend acceleration in a small handful of states. So we've got a small number of Phase II that we called out Florida and New York that really account for the majority of the miss in Q2. As an example, Florida alone accounted for 40 basis points of HBR pressure in the quarter. So we are really able to be focused and organized around those states even more intensively in terms of pulling levers. Obviously, pulling them across all states and taking an enterprise-wide approach, but really focused on being able to drive outsized impact in that select number of geographies. Those levers include appropriate utilization management, helping states understand where they've got opportunities relative to clear clinical policy guidelines. This is a big thing in both HCBS and behavioral health. States are still sort of evolving their perspective on what appropriate dose duration looks like. We're optimizing networks, ensuring that we've got highest-quality providers. We're aligning members to those providers. And then pretty aggressively stamping out fraud, waste and abuse, which is not talked about as much, but we are seeing a much higher prevalence of that in the behavioral health space, partly because of the fragmented provider base. And then, of course, advocating for rates. So while some of these things do take time to show up in the results, we are seeing progress. And again, if we go through just that handful of states that account for the majority of the miss, in Florida, the continuity of care provision listed 6/1. We're obviously advocating aggressively for rates, both retroactively and prospectively to address the rate gap. In New York, we've got a clear road map. We're seeing progress there on a number of fronts, including really good support from the state to go after fraud, waste and abuse. And then in 2 of the other states, those states both sit in the 7/1 to 9/1 cohort and both got important and healthy rate updates that do take current trend into account. One of them is also the state that Drew referenced that has made a move away from the single PBM model. And so as of 10/1, we'll be able to get them over to ESI and leverage our cost structure. So I think being able to move the needle in a pretty concentrated way, obviously, also pushing across the portfolio. But for context, about 1/3 of our health plans are outperforming their original HBR targets year-to-date. So we do have a pretty healthy portion of the book. We know where to focus in terms of where to significantly move the needle. I think we know what to do. We're aggressively getting after it. And so taking a step back, that is really the momentum that gives us confidence that, over the next 4 to 6 quarters, we'll be able to deliver meaningful margin improvement in Medicaid, and that informs the view of the back half as well.

And our next question today comes from David Windley at Jefferies.

I wanted to ask on kind of the Wakely data of membership trend, if implied in the Wakely data, that you called out in your pre- announcement, kind of said that the market attrition had been more of the growth, I guess, you called it, the growth was smaller in the market. Can you talk about what the market size is today? What assumptions you are making about further attrition over the balance of the year and, therefore, further shift in morbidity over the balance of the year, please?

Yes, absolutely. So you're right. We called out the fact that the Wakely data is really the first time that we have an empirical view of what the total market is doing. And the overall growth in the market, now obviously, it's different state by state, but the overall growth in the market was lower than, for example, what CMS had put out at the beginning of the year in terms of the 13.5% relative to signups. So obviously, that means that the delta between sign-ups and infectuations was a lot bigger than it has been in past years. And this is not fully validated in the Wakely data, I think we'll have a better view of that as we get the tranches in September and December. But based on what we can triangulate, our view is that the market actually contracted during open enrollment in 2025 and likely is continuing to contract month over month as we go through the year. For our part, we are expecting further attrition in 2025. So we're sitting at 5.9 million members today. We expect to end the year at 5.4 million members. Part of that is driven by the FTR failure to report PDM, which we talked about back in -- on the Q4 call, because I think everybody anticipated that, that would -- those impacts would be taken in open enrollment. They actually got shifted to the summer time frame. As we look at the files that are coming in for August 1, we believe we're seeing the first wave of FTR starting to get implemented. So we think that will drive further membership attrition over the back half of the year and have accounted for the idea that, that may also drive some morbidity shifts, although I don't think we see a huge delta in that population. But again, very cognizant of that given what we saw in Wakely and what it could do for the rest of the year. And then, of course, we expect further attrition in the 2026 open enrollment. And whether you're doing math on eAPTCs in or out, if you look at some of the public sources, the numbers that have been thrown out there, anywhere from 15% to 50%. I think the higher end of that probably ignores what we saw in 2025 in terms of being a pull forward of market contraction into the 2025 year. And the bottom end of that probably undershoots the impact of the program integrity measures based on what we've seen, and obviously, assumes the APTCs continue. So I think somewhere in the middle of that range is probably a safe zone to assume. But we'll have a better view of that as we get further data in September and then understand the landscape file from competitors and have a little bit more precision from CMS on the exact process that's going to be in place for program integrity for 2026.

And our next question today comes from Lance Wilkes with Bernstein.

Can you talk a little bit about the risk adjustment payable? And in particular, what I'm interested in is, what's the strategy as you go into '26 and beyond to address kind of product structure and benefit structure to either reposition yourselves to be having a lower payable? Or are you going to be comfortable being a much higher payable player out there? What would be the other considerations as you go through that strategy with respect to membership and profitability?

Yes. Thanks, Lance. It's a great question. So as we've been going through 2026 repricing, understanding that we've been operating under a very tight window to get all those refilings in by the deadline, we are also taking into account sort of the macro dynamics of each market and thinking about the degree to which we'll be able to price for what we think the ultimate morbidity shift will be and where there may be opportunities or, frankly, mandates to sort of tweak our presence in a market, thinking differently about product tiers, thinking differently about network partners. Because, again, the goal is to really maximize margin over membership in 2026. And then I would say, as we think about 2027 and beyond, I'll make this comment for Marketplace, but I think it's true across the portfolio, is it's an opportunity for us to take a step back and make sure that we really have a portfolio in each line of business that is optimized for our goal of delivering sustainable margins over the long term. And so that will be a process that I think we can do as we step into 2026 and think about 2027 pricing. Relative to the payable/receivable dynamic, that is obviously an inherent dynamic in the marketplace and one we're always being thoughtful about. I think one of the questions that we've spent a lot of time talking about, not just in light of the most current events, but just in general, is how we could leverage our size and scale as the largest player in the market to drive an additional level of transparency and also make sure that, where there are program improvements, to create stability overall, we're leaning into those? So just 2 examples. One would be the opportunity to make some of the demographic data available earlier in the year, so think about immediately post open enrollment. And whether that's through CMS, through the Departments of Insurance, through Wakely, really lending our data as sort of a first-mover in that, and creating broader transparency for the entire market, I think, will allow people to make much better assumptions relative to risk adjustment going forward. And then the second would be working with the administration so that, where there are policy or process changes, that they are locked down before pricing is due. And so I think this is something that we see in Medicare that's more mature. But part of the program integrity changes that went into effect late last year were introduced after pricing. And so making sure that if there are going to be changes, that all carriers have visibility to those and can integrate them into their pricing is obviously going to drive more stability long term. So those are conversations that we're actively having and have thoughts on I think continue to just look at ways both in our own forecasting, but then also in how the market operates overall, we can ensure that this is a stable platform as possible because we do believe that it is a really important platform for individual and family coverage. And as we've talked about a lot before, we are very optimistic that it is actually sort of the ultimate platform for how individuals and families purchase health care coverage. And we can talk about the momentum we're seeing around ICHRA, the momentum we are driving around ICHRA, but obviously part of the exact same risk pool. So it's really important that we get the underlying programmatic elements right in order to make sure that we can grow that risk pool, which will ultimately bring down premiums, bring down cost of subsidy and create more affordable options for Americans.

And our next question today comes from Kevin Fischbeck at Bank of America.

Okay. Great. I just wanted to go back to the Medicaid discussion. You made a number of comments about progress or substantial progress over the next 12 to 18 months. Does that mean that you don't expect to be back to target margins in Medicaid in 2027? And it sounds like a lot of what you're pointing to in the pressure in Medicaid is about cost trend. I think some of your peers have talked about risk pools changing as well. So just any color you have on that side? Because it does seem like there's going to be additional membership losses in Medicaid over the next several years, and whether you think that's going to be another difficulty in getting back to target margins in Medicaid.

Yes, Kevin, thanks for the question, and welcome back. So we did -- I went through sort of a number of the levers that we're pulling around driving improvement in the overall Medicaid book. Again, focus in the areas where we've got trend, focus in those geographies. When I think about the momentum that we are seeing, and again, sort of take a step back, having sort of wrestled the tail of redeterminations over the last 18 months and then the step-up in trend, we continue to see progress in terms of our ability to have productive discussions with the states relative to rate, integrate more real-time data, have those actuaries thinking about how trend shifts and risk pool shifts can be more quickly integrated into the view. And I think we're seeing that in terms of both the rate increases that we've gotten as well as what we're seeing for 7/1 and 9/1 and continue to push going forward. So the question is, to your point, is really when, not if. And I think as we think about the next couple of quarters, I think you introduced correctly the piece that we're going to want to be thoughtful about as we set the recovery trajectory for Medicaid, which is that as we move into 2027 and 2028, we will have, assuming they get upheld on the other side of midterms and implemented on time, we will have some of the OB3 impacts to consider. So things like work requirements, 6-month verifications. And we do think that that will shift the risk pool slightly because it will cause members to lose coverage. Obviously, having gone through a version of redeterminations, we are smarter now about how that may shift the risk pool. But I think we want to take that into account as we think about both what the recovery trajectory is and what the long-term run rate is for HBR margins. But if you ask me over the next 4 to 6 quarters and as we think about '27 and beyond, are we going to improve the Medicaid margins? My answer is yes. And I think we have the ability to take into account those impacts and be thoughtful about not overshooting get into 2027 and 2028. But again, we continue to push hard on the various levers that we can control, and I think are seeing a different kind of conversation with the states about being more prospective in the rate setting. And, frankly, also thinking about the fact that in this kind of environment with the level of disruption that we've been going through and some of the additional changes that are forthcoming, that resetting rates in Medicaid on an annual basis probably doesn't make sense. And so a number of states, although we don't talk about it a lot, a number of states actually do leverage a midyear rate cycle to address or assess where we stand. And I think we have seen, again, over the last 2 years, states leveraging more of those mid-cycle conversations to think about how trends are shifting in real time. And that is a place that we are leaning hard into from an advocacy standpoint, and I suspect that we will get support from our peers on that as well.

And our next question today comes from Stephen Baxter at Wells Fargo.

Wells Fargo Securities, LLC, Research Division I just wanted to follow up on Justin's question going from the second quarter MLR to the 93.5% for the back half. You gave us a pretty good sense on the rate side of things, but it seems like the vast majority of that needs to basically drop through with minimal cost growth in order to make that MLR achievable. I was just hoping you could talk a little bit more about the cost assumptions that you're making in the back half of the year. And then any kind of sense of what you're expecting in terms of membership in Medicaid for the rest of the year would also be helpful. Just wondering if you're planning for more attrition or any kind of impact on some of the CMS announcements that we've gotten recently.

Yes, sure. Thanks for the question. So obviously, rates are an important factor, but really, a lot of the other levers that I mentioned that are entirely in our control are important in terms of your question, the assumption on overall cost and what that will do. So if we think about what's built into the forecast, it is really assuming that sort of the level of trend that we have been seeing, the accelerated trend will continue to some degree in the back half of the year. And that way, the improvements that we're making in terms of the levers we're pulling, optimizing networks, making sure that we've got the right clinical policy guidelines, appropriate utilization management, those are all opportunities to sort of further bend the trend. And then I'll let Drew talk a little bit about the membership assumptions that we have baked in for the back half.

Yes. Thanks for the question. And so let's start with rate first because you mentioned that. We're getting 5%, about 5%, and that's 29% of our revenue stream in the third quarter. That breaks down 20% on 7/1 and 9% on 9/1. And then we've got another 19% on 10/1 in terms of the proportion of the revenue for the year. And we think we've made a really prudent assumption there as we're pushing those 10/1 states for appropriate rate increases. On the cost side, when we take a look at the trajectory of net expense PMPMs, we've baked in over 4% lift in the second half of the year versus the first half of the year. So we think that's appropriate given what we've seen. And there's a lot of things that we're not betting on. We're not baking in, including, I mentioned in my script, the Florida. We absolutely need and can justify and deserve a retro for the Children's Medical Services population. That is not in our forecast, as one example. And as well, some of the risk adjustment improvements that we need in the State of New York. So we've been really, we think, prudent with the back half forecast. But don't underestimate the power of that revenue coming in, the 88% between 7/1 and 1/1 of '26.

And our next question today comes from Andrew Mok at Barclays.

Just wanted to follow up on the ACA outlook for next year. I think in the prepared remarks, you said that ACA was slightly below breakeven margins this year and you're targeting to restore that back to profitability, which I think could be interpreted as a very modest margin improvement. Then you later said that you're repricing for meaningful margin improvement. So can you, one, help clarify and level set the expectations for margin improvement next year? And maybe walk us through the framework for the range of outcomes on both margins and membership?

Sure. So you're right that we are expecting to operate slightly below breakeven for 2025. We are pricing to return to profitability in 2026. It is too early to understand whether -- what sort of that range will be. But as we thought about the refiling and the pricing that we're putting in state by state, as I mentioned, we're very focused on margin over membership. We are being thoughtful about trying to bake in all of the assumptions that we see and now expect as we think about further morbidity shifts in 2026. And so being sort of prudent and conservative in our view and leaning on margin is what gives us a view of being able to deliver meaningful margin improvement. The view of 2026 gets clearer as we get, one, through the rate filings; two, through the state certifications in August. And then in September -- towards the end of September, we get the first view of the equivalent of the landscape file, which is the IMP-1A file for Marketplace and understand our pricing landed relative to peers. That will start to give us a better sense of possible for 2026. And then I think moving through open enrollment and seeing how the impacts of the program integrity rules play out will obviously be sort of the key final factor. So as we get through that, we'll certainly give you updates on the view. But I think at this moment, it's too early to give any real solid ranges around Marketplace guidance for 2026, other than a return to profitability, which we think is pretty meaningful.

And our next question today comes from John Stansel at JPMorgan.

I just wanted to drill down on the Part D update. Now I think you called out approximately $700 million of pretax favorability for the overall Medicare segment, with a portion of that attributable to Part D. It sounds like you're getting G&A leverage there. As you progress through the year, what are you seeing kind of around your assumptions that are giving kind of comfort? And then it sounds like you're well above the kind of the previous 1% margin target in that business. How are you thinking about that from a margin perspective? And with national bids coming out in the next week or so, any updated thoughts around what 2026 in Part D looks like with or without the demo?

No. Good questions around PDP. And yes, we, and we suspect others bid, assuming the demo does not continue, but we'll see what CMS decides to do. And so you're right, pleased with the performance in PDP. It's good to have now 6 months under our belt so we can see, coming into the year, the changes in the IRA, what that did to specialty trend. And you're right, we're north of our 1% budget margin. Of course, we bid for a higher margin than 1%. That's where we started our initial guidance at. So really pleased with what we're seeing. And it's a pretty stable membership in terms of Q1 to Q2. And with the IRA, you can anticipate a sloping upward in terms of the Medicare segment, HBR, which is highly influenced by PDP as we get through the year.

And our next question today comes from Sarah James at Cantor.

Can you talk about how exchange progressed to the quarter? So was there a trend acceleration in claims or a noticeable market with pool deterioration in June compared to earlier in the quarter? And if so, are you assuming that it continues to accelerate throughout the end of the year?

Just to clarify, you're asking about Marketplace, mix changes?

Yes.

Okay. Yes, absolutely. Yes. So again, as we talked about, sort of the biggest factor for Marketplace was the morbidity shift, but we also saw broad utilization across categories. So that's inpatient, outpatient, ER, PCP. And as we said earlier, that continued, the new member trend was more significant than renewing members. I think there have been a number of interesting hypotheses about what's driving that. One that has been put forward is the idea that there are redetermined numbers for Medicaid that have moved into Marketplace and are driving that trend. What's interesting is, obviously, having the largest Medicaid and Marketplace book, we looked at that. And the volume of shifting members from our book to book in '24 and '25 was actually not different, I mean, almost exactly the same. What is interesting is that we are seeing higher utilization in the 2025 cohort, which does suggest that there is sort of a step-up in demand among the population. I'll sort of take a step back and just make an observation from a behavioral economics standpoint. If you think about Marketplace and Medicaid members, what these folks have been hearing from every major media outlet for the last 6 months is that Congress is going to take away their health insurance. And that I think does drive a certain level of behavior when compounded with macroeconomic uncertainty. We've seen this before in health care and health insurance. And then those folks are coming into the system and colliding with a provider ecosystem that is largely still operating in a fee-for-service manner, is concerned about losing revenue. And that's where we're seeing, I think, some of the aggressive billing and coding. So all of that collides to that sort of third point I mentioned, which is a higher step-up in documented morbidity that is being connected to the utilization. Now to your specific question, we didn't see any specific -- we're sort of seeing that level of utilization pretty consistent, and we are expecting and have baked in, which you heard in my remarks, trend in the back half of the year, consistent with that, as well as a potential step-up related to folks using the system in advance of a potential expiration of enhanced APTCs. Now what I think will be interesting to see is whether some of the pressure we've seen in the first half of the year actually represents essentially preemptive demand or a seasonal shift. And we've already accounted for some of that utilization in advance of the expiration of the subsidies, but we have accounted for it regardless just in an effort to be prudent as we think about the back half of the year.

And our next question today comes from Ann Hynes of Mizuho Securities.

In your remarks, you talked about you see an increase in morbidity really driven by coding. Can you just talk about what states you're seeing that? And I think you said it's in a few states. What type of providers you're seeing increased coding? And I guess, going forward, how do you underwrite as an insurance company for coding changes? Because it is the behavior change that might be difficult to capture.

Yes. So again, I think the coding intensity, I don't think we have empirical data around. I think it's, again, somewhat speculative, but given what we're seeing, and we've got a number of other folks who've collaborated that. The recent weekly report that came out earlier this week spoke to that as well. It's really for us an extrapolation off of what we're seeing in terms of patterns. There are definitely very clear areas where we have seen a step-up in coding intensity, partly driven, I think, likely by revenue cycle activity at hospitals. And so there are very targeted areas that we are focused on there, and making sure that if they integrate AI into the revenue cycle, we're integrating AI into payment integrity to make sure that we are sort of keeping pace with all of that. I do think that some of this idea of the coding intensity we're seeing, as I mentioned earlier, is a little bit of the behavioral economics byproduct of folks seeking services because of scarcity and fear of loss, and then provider is concerned about revenue, and those 2 things colliding. So there aren't specific geographies where we would call out pressure points in markets. I think if you think about the larger hospital systems, that's probably where some of that sophistication is more likely to manifest. And knowing that, that's obviously part of our thoughtful investment as we go forward, to make sure that we are good stewards of taxpayer dollars. We're staying on top of opportunities for waste, fraud and abuse, and just being thoughtful about the fact that, as more members use services, we will see higher documented morbidity as we catch the overall acuity and can adjust for that going forward. So I think some of this, in some ways, in Marketplace, what we're seeing is a little bit of a version of redeterminations, and getting a clearer picture -- redeterminations for the Marketplace, right? So similar to what we saw in Medicaid. And getting a clearer picture of what the baseline morbidity of that population is. So not really concerned that coding intensity is sort of going to get away from us. I think that's pretty normal course, and we're paying attention to where we need to get out ahead of that.

And our final question today comes from Michael Ha with Baird.

Just quickly first on exchanges in the back half guide. I know you mentioned assumptions on induced utilization, FTR shifts, morbidity shifts. But was there anything included on CMS has identified duplicative members, how that could impact the risk pool? And are there any other meaningful buckets worth calling out? And then apologies in advance for this longer question. Just following up on Kevin's question, Trying to understand, despite the shift in the landscape, you still believe the staying power of Medicaid is as strong as ever. But as we look to '27 work requirements, I understand the actual percentage of Medicaid lives where able-bodied expansion adults is rather small, but just based on our channel checks and talking enrollment analytics professionals this year, seems to be more on the negative precedent that the redetermination set on procedural disenrollment, if members who shouldn't even qualify end up being required to submit any type of paperwork, they failed to do so, you see outsized procedure of disenrollment, that drives further margin pressure in the next few years. But when you think about that and the learnings from your recent redeterminations and what Centene can apply on your own end to help avoid that? Just wondering what are those tactics or best practices that you can implement?

Great questions. Okay. Let me make sure I hit all of these. So first, back half of the year for Marketplace, additional pools where we may see member attrition. You called out duplicative members. We track that pretty closely. We don't anticipate sort of a huge shift from that. But we're obviously paying attention to it, and that's part of accounting. The provision that we put in the back half of the year accounts for additional morbidity shifts and utilization. FTI, I mentioned, that's another pool that folks should be paying attention to because that shifted to summer. We're now seeing that come in -- we believe we're seeing the first wave of that in August. So that's part of what drives our 5.9 to 5.4. So in that bucket is the idea that there will be additional attrition and then some degree of morbidity shift in the back half of the year. So shifting to Medicaid and looking out longer term. So one, we've commented on sort of the staying power of Medicaid. I do want to make just one comment and then I'll get very specifically into your question about how we can optimize coverage for members in light of work requirements and other sort of eligibility verifications. When you think about One Big Beautiful Bill, there's a lot of conversation about how those provisions have landed and what the negative impact may be, I think it's really important to also remember that there were a number of far more disruptive provisions that were discussed and could have been introduced in that. So things like per capita caps, FMAP reduction, block grants, all of which really got taken off the table very early in the conversation. And the reason I point that out is just because what that should tell you is that Medicaid has more bipartisan support than it has ever had as a program. So that's really sort of the core of our view of the staying power in Medicaid. And then to your point, one of the benefits, and I think one of the things that's going to be super important as we go forward, even more important than the past, is size and scale. And that is -- we're going to need to operate at a different level of efficiencies, and we're going to need to be able to lean in to think about how to reduce the friction of things like 6-month verifications and things like work requirements to maximize coverage where it's appropriate. So again, we have the benefit of a couple of years here relative to implementation. Worth noting that we'll have to see what happens in midterms and what that may or may not do to time frames and sort of how these provisions unfold. But we are actively working on strategies to move to more digital enrollment and reenrollment as well as work requirement verification, which is something that CMS and administration leadership are very passionate about. So really aligned in that and being thoughtful about innovative partners that could help with that. We have a number -- we have a history because we have states that have work requirements, of actually helping members get work and work programs. And so ramping those up and thinking about how we can make sure that folks who are doing good work or are going to school or are serving as caretakers are really correctly documented as such. And then the last thing I will point out, which is a very small win that went by, but nobody is really talking about, but we talked about it a lot during redeterminations was the idea that, because of TCPA historically had a harder time reaching out to members digitally. But one of the things that's very deep in OB3 is actually a change to that, which I think opens the opportunity for a different level of digital interaction with Medicaid members. And that's something that we need to push hard on to make sure that both the verification process and the work requirement documentation process take advantage of that. And I think that will help, again, make sure that, where members are eligible, they get coverage, and then continue to work state by state to ensure that as the states view of what able-bodied is and the degree to which they want coverage for those populations, we are good partners and ultimately maximize the coverage for vulnerable Americans.

Thank you. This concludes our question-and-answer session. I'd like to turn the conference back over to Sarah London for closing remarks.

Thanks, Rocco, and thanks, everyone, as always, for your thoughtful questions and your interest in Centene. We look forward to providing updates as we have additional visibility in some of these key milestones that we've talked about this morning over the next few months. I do want to end today by addressing the many members of the CenTeam who I know are listening this morning. Over the last 3 years, you all have done tremendous work to transform this organization. And these results do not reflect this progress nor what you do every day to ensure that our members get the care and the support that they need to lead healthy lives. We are operating in unprecedented times and we have hard work ahead of us. But I have total confidence in this team's ability to tackle those challenges and to deliver meaningful results. We are on a mission to transform the health of the communities we serve one person at a time, and there is no team I would rather be on this mission with. Thank you all.