Health Care Costs Payable

3 Months Ended

Mar. 31, 2025

Health Care And Other Insurance Liabilities [Abstract]

Health Care Costs Payable

Health Care Costs Payable

The following table shows the components of the change in health care costs payable during the three months ended March 31, 2025 and 2024:

	Three Months Ended March 31,
In millions	2025		2024
Health care costs payable, beginning of the period	$	15,064	$	12,049
Less: Reinsurance recoverables	81		5
Less: Impact of discount rate on long-duration insurance reserves (1)	(1)		(23)
Health care costs payable, beginning of the period, net	14,984		12,067
Add: Components of incurred health care costs
Current year	30,293		28,212
Prior years	(1,651)		(479)
Total incurred health care costs (2)	28,642		27,733
Less: Claims paid
Current year	19,312		16,263
Prior years	9,749		9,150
Total claims paid	29,061		25,413
Health care costs payable, end of the period, net	14,565		14,387
Add: Premium deficiency reserve	431		—
Add: Reinsurance recoverables	114		4
Add: Impact of discount rate on long-duration insurance reserves (1)	2		(23)
Health care costs payable, end of the period	$	15,112	$	14,368

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(1)Reflects the difference between the current discount rate and the locked-in discount rate on long-duration insurance reserves which is recorded within accumulated other comprehensive income (loss) on the unaudited condensed consolidated balance sheets.

(2)Total incurred health care costs for the three months ended March 31, 2025 and 2024 in the table above exclude $16 million and $23 million, respectively, of health care costs recorded in the Health Care Benefits segment that are included in other insurance liabilities on the unaudited condensed consolidated balance sheets and $46 million and $47 million, respectively, of health care costs recorded in the Corporate/Other segment that are included in other insurance liabilities on the unaudited condensed consolidated balance sheets. Total incurred health care costs for the three months ended March 31, 2025 also exclude $431 million for a premium deficiency reserve for the 2025 coverage year related to the Company’s individual exchange product line.

The Company’s estimates of prior years’ health care costs payable decreased by $1.7 billion and $479 million, respectively, in the three months ended March 31, 2025 and 2024, because claims were settled for amounts less than originally estimated (i.e., the amount of claims incurred was lower than originally estimated), primarily due to lower health care cost trends as well as the actual claim submission time being faster than originally assumed (i.e., the Company’s completion factors were higher than originally assumed) in estimating health care costs payable at the end of the prior year.

At March 31, 2025, the Company’s liabilities for the ultimate cost of (i) services rendered to the Company’s Insured members but not yet reported to the Company and (ii) claims which have been reported to the Company but not yet paid (collectively, “IBNR”) plus expected development on reported claims totaled approximately $10.7 billion. The majority of the Company’s liabilities for IBNR plus expected development on reported claims at March 31, 2025 related to the current year.