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President & CEO Cary Grace noted that the Q2 utilization decrease was concentrated among a small group of clients, mainly academic medical centers, which are now showing stabilization. CFO & COO Brian Scott added that while Q2 order declines will impact Q3, stabilizing orders and rising extension rates suggest a new normal, with winter orders expected to drive improvement later in the year. Scott also stated that slowing patient volume growth is not a major driver of client behavior.

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President & CEO Marty Bonick stated that tertiary hospitals are frequently full, making throughput and length-of-stay initiatives critical. He expressed confidence in backfilling volume via physician outreach and service line strategies targeting higher-acuity patients. On M&A, Bonick noted that outreach and discussions have increased since the bill's passage, and while Ardent remains disciplined, its appetite for growth is unchanged, though it will strategically hone its focus on markets with favorable state dynamics.

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CEO Javier J. Rodriguez and CFO Joel Ackerman explained that elevated mortality is a national trend across diseases, likely a holdover from COVID-related care delays. Rodriguez noted that the company's mitigation plans, including new technologies and protocols, are long-term initiatives expected to show gradual impact over years, not quarters. He also expressed confidence that operational discipline and technology would allow cost efficiencies to continue even with volume recovery.

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President and COO Brian Evanko described the current pricing environment as 'firm' and 'rational,' with expectations for 2026 price increases to exceed 2025 levels. EVP and CFO Ann Dennison noted that most businesses are performing within target margins, with the two exceptions being the exchange business (running below target) and the stop-loss business (on a path to margin recovery through 2026).

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CFO Celeste Mellet stated that Part D member mix and prescription drug trends are tracking in line with their expectations for low double-digit growth. George Renaudin, President of Insurance, added that the national average bid for 2026 came in slightly better than they had anticipated, which they view as a positive development.

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Executive VP & CFO Steve Filton attributed the volume weakness to a combination of factors. He noted that while UHS captures a good share of 'step down' patients, it faces broad competition in the 'step in' freestanding outpatient market, a space it hasn't historically competed in aggressively. He reiterated that the company is now focused on building new capacity, improving referral processes, and enhancing staff recruitment and retention to drive future growth.

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CFO Mike Marks deferred providing detailed historical exchange data until the Q4 call. Regarding long-term guidance, he reiterated that HCA believes it can manage the impacts of the new act without material harm to its long-term targets, aided by resiliency efforts and potential supplemental payment approvals. He noted they are working on offsets for any EPTC impact and will provide a full update in Q4.

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CEO Sarah London affirmed that returning to target margins is a matter of 'when, not if,' citing progress in rate discussions with states. She acknowledged that policy changes like work requirements in 2027-2028 will need to be factored in, potentially shifting the risk pool. However, she stated that learnings from redeterminations will help manage this, and she expects to deliver meaningful margin improvement over the next 4-6 quarters and into 2027.

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CEO Sarah London clarified that while Centene is confident in improving Medicaid margins over the next 4-6 quarters, the long-term trajectory must account for potential risk pool shifts from OB3 provisions in 2027-2028. She emphasized that states are increasingly open to using real-time data for rate setting, which supports the recovery, and the question is 'when, not if' they will improve margins.

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CEO Joseph Zubretsky explained that while the 'what' of the trend is understood (behavioral, pharmacy), the 'why' is complex, involving higher prevalence, reduced stigma, and supply-side factors. He emphasized that advocating for a recent baseline period in rate setting is key to catching up. CFO Mark Keim confirmed the $8.65 per share embedded earnings figure is unchanged as an ultimate target, though the near-term realization timeline is subject to the current rate environment.

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Chairman & CEO Saum Sutaria confirmed that strong exchange growth was a definite contributor to the favorable payer mix, especially as a landing spot post-Medicaid redetermination. He asserted that underlying macro demand for services remains strong, and the high-acuity strategy builds on that base to drive margin expansion, cautioning against over-reading trends from a single quarter.

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