Can Elevance Health's Value-Based Care Strategy Fuel Long-Term Growth?

Elevance Health, Inc. ELV, one of the largest health insurers in the United States, has been actively expanding its focus toward value-based care. This move indicates that the company visualizes the future of healthcare driven by patient outcomes.

Unlike traditional models that focus on the quantity of care provided, value-based care emphasizes coordinated treatment, preventive strategies and cost efficiency. ELV is expanding its value-based care portfolio, especially in behavioral health and oncology. Through its Carelon business, the company integrates pharmacy, behavioral health and complex care management by creating a comprehensive approach to address the needs of its members.

Elevance Health’s care delivery services primarily focus on serving chronic and complex populations by offering tailored care in the home and virtually. The company acquired CareBridge in 2024, which provides virtual care to Medicaid and Medicare patients and helps in plans in managing home and community-based services. Through this strategy, it aims to improve its visibility and consistency in the long run.

These strategies can help ELV gain more membership and retain consumers. In the last reported quarter, the company’s Medicare Advantage memberships improved 11% year over year, while individual membership grew 5.2%. In the same quarter, its total revenues rose 13.4% year over year.

If ELV can efficiently manage provider networks and scale its operations while managing upfront costs, its focus on value-based care can turn into a powerful engine for long-term growth.

How Are Competitors Faring?

Some of ELV’s competitors in the value-based care space are UnitedHealth Group Incorporated UNH and Humana Inc. HUM.

With the help of its Optum division, UnitedHealth Group aims to reduce hospital admissions, enhance chronic condition management and improve patient satisfaction, which plays a crucial role in shaping outcomes and managing costs. In the first half of 2025, UnitedHealth Group reported 5.8% year-over-year growth in revenues in its Optum business.

Humana’s CenterWell business offers services like pharmacy, primary care and home health solutions, which are designed to improve the overall healthcare experience. Humana’s revenues from the CenterWell unit rose 8.9% year over year in the first half of 2025.

Elevance Health’s Price Performance, Valuation & Estimates

Shares of ELV have lost 14.1% in the year-to-date period compared with the industry’s decline of 0.7%.

From a valuation standpoint, Elevance Health trades at a forward price-to-earnings ratio of 9.62, down from the industry average of 15.16. ELV has a Value Score of A at present.

The Zacks Consensus Estimate for Elevance Health’s 2025 earnings is pegged at $30.15 per share, implying an 8.8% decline from the year-ago period.

The stock currently carries a Zacks Rank #5 (Strong Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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