Good day, and welcome to the Centene Corporation First Quarter 2021 Earnings Conference Call. I would now like to turn the conference over to Jennifer Gilligan, Senior Vice President of Finance and Investor Relations. Please go ahead, ma'am. Thank you, Rocco, and good morning, everyone. Thank you for joining us on our first quarter 2021 earnings results conference call. Michael Neidorff, Chairman, President, and Chief Executive Officer, and Jeff Schwaneke, 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. Actual results may differ materially from those indicated by those forward-looking statements as a result of various important factors, including those discussed in Centene's most recent Form 10-Q filed today, and the Form 10-K dated February 22nd, 2021, and other public SEC filings, including the risks and uncertainties described with respect to the potential impacts of COVID-19 on our business and results of operation. 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 first quarter 2021 press release, which is available on the company's website under the investor section. Additionally, please mark your calendars for our upcoming Investor Day, to be held virtually on June 16th, 2021. With that, I would like to turn the call over to our Chairman, President, and CEO, Michael Neidorff. Michael? Thank you, Jennifer. Good morning, thank you for joining Centene's first quarter earnings call. On the call today, I will review our first quarter performance, provide an update on our markets and products, and discuss how we are positioned to sustain our momentum in the ongoing pandemic environment. While we have made great progress in working our way out of the pandemic, nationally, as we have seen recently, it is not yet over. We are off to a strong start in 2021, with solid revenue and earnings growth. It was a good quarter. Our teams continue to execute well, generating revenue of $30 billion, an increase of 15% compared to the first quarter of 2020. Membership was 25.1 million at the quarter end. This represents an increase of 1.3 million compared to the year ago quarter. Adjusted to earnings per share of $1.63, compared to $0.86 in the prior year quarter, representing an increase of 90%. Overall, we are pleased with our first quarter performance and the trajectory of our business. Today we're updating our full year guidance. This is primarily driven by several tailwinds. These include, first, continued Medicaid membership growth amid suspended eligibility redeterminations. Our current guidance anticipates the suspension continuing to at least August 1, based on the fact that it is renewed 90 days at a time. Second, the Marketplace special enrollment period, which I will discuss in more detail shortly. Third, the hold on the Medicare sequestration. Our results to date also reflect a decrease in normal utilization, offset by COVID-19 expenses and state recoupment of premiums, which Jeff will provide additional detail on shortly. As we have done throughout the pandemic, we continue to monitor the headwinds and tailwinds we anticipate will impact our operating landscapes for the remainder of the year, and possibly into 2022. Consistent with past quarters, I will provide you with updates based on the facts as we know them today. When taken together, we believe the essence of these factors to be positive. Anticipated tailwinds include continued lower than normal utilization. Overall, the first quarter was lower compared to the prior quarter, although we saw an increase in non-COVID utilization in our Marketplace business. While the trajectory of utilization depends on the pandemic and remains uncertain, we continue to expect utilization to come in below historical averages during the second quarter, with the potential for some normalization starting to occur in the second half of the year. Other key possible tailwinds we see include Potential for continued growth resulting in higher than anticipated membership in our Marketplace business from the special enrollment period, and a probable extension of the Medicaid eligibility redetermination suspension beyond August and through the end of the year, possibly into the beginning of 2022. As a potential headwind, we continue to monitor additional state rate adjustments. For 2021, we anticipate a $550 million revenue impact of state revenue actions and rate actions. Jeff will provide some additional color on this shortly, but I will share that we have seen only one action in the first quarter of the year, and we are not currently aware of any additional plan adjustments or corridors. In fact, some corridors, we believe, may be allowed to expire. To reiterate, overall, as we see them today, we believe these factors balance in our favor. As we conclude the first quarter of 2021, we are pleased with our ability to drive significant growth, our updated guidance reflects the strength of our business through the year. We also remain vigilant that this is a year with unique drivers, including the suspension of Medicaid eligibility redeterminations and the Marketplace Special Enrollment Period, which we cannot be certain will continue throughout all of 2022. Consistent with prior years, at our June Investor Day, we will provide an update on these factors and 2022. We recognize that while the factors as we see them today balance to the positive, the outlook remains fluid and dependent on the public policy landscape. The strength of our diversified business is apparent across our product portfolio. In our Medicaid business, we continue to participate in an active RFP pipeline. We successfully renewed our contract in Hawaii at the end of March. North Carolina and Oklahoma both remain on track to go live later this year. For 2021, we continue to expect a composite rate adjustment of 1.7%, consistent with our initial guidance. Our Medicare business delivered continued growth. Medicare grew by over $1 billion year-over-year in the first quarter, representing growth of 41% and demonstrating the strength of the platform and our ability to leverage our national scale going forward. In our Marketplace business, we are pleased to be operating in a supportive environment. The administration continues to invest in the product, and just last week announced an additional $80 million for navigators to boost enrollment. Based on data released by CMS, Centene is a clear leader in new enrollment on the federal exchange. Since the beginning of the year, we have enrolled over 320,000 new members in our Marketplace product. We believe these results demonstrate the strength of our strategy to provide consistent quality care and not to participate in a price-related race to the bottom with narrow network coverage. I will remind you that narrow networks often encourage out-of-network utilization, which tends to be uncontrolled and expensive. We see opportunity to further grow with the enhanced Advance Premium Tax Credits that took effect April 1. The impact of which we believe will encourage consumers to prioritize quality, consistency, and experience over premium alone. Moving ahead, we intend to maintain and consider building additional products around this strategy. On the technology front, we're making meaningful progress to advance our capabilities to provide high-quality integrated care for our members. We look forward to providing you more details on our unique technology strategy at our Investors event in June. We continue to advance towards the completion of the Magellan Health acquisition and remain on track to close the transaction early in the second half of 2021. The Hart-Scott-Rodino waiting period expired mid-March. We're working diligently towards obtaining the necessary state approvals. Our integration planning efforts are in full swing. We are enthusiastic about the combination, which will enable us to expand access to specialty care and nurture a fully integrated model across behavioral and physical health. I will remind you that Magellan will be part of our healthcare enterprise portfolio, which will allow them to maintain independence and serve third-party customers. I would like to take a moment to comment on the situation in Ohio. We are still in an active RFP process where we finished second out of 11 bidders, according to a scoring summary released by the Ohio Department of Medicaid. Regarding the legal and regulatory landscape, Centene has been clear that we maintain its claims to be unfounded. For additional information about our position on this matter, I would direct you to our website for links to our court filings. We look forward to answering any questions from our governmental partners regarding this issue and remain committed to the highest levels of quality and transparency in how we serve our state partners. Before I close, I'd like to talk about Centene's role in COVID-19 vaccine distribution. Over the past few months, our data and care management teams have worked tirelessly to identify members at the highest risk for COVID-19 and provide those individuals with personalized and culturally sensitive outreach. In addition, we have partnered with Lyft to support individuals with transportation to vaccine appointments. With the Gold Jacket of the Pro Football Hall of Fame, with whom we have had an ongoing partnership, we created PSAs focused on increasing awareness about the safety and efficacy of COVID-19 vaccines. This type of innovative work is happening across the organization, and I want to recognize and thank our employees for their unwavering commitment and dedication. In closing, we started the year strong and look forward to carrying this positive momentum through the remainder of 2021. As we experience a supportive environment in expanding access to care, we continue to see long-term opportunities to drive growth in our top and bottom line and enhance margins as we provide the highest level of care to our members at the lowest cost. I look forward to seeing all of you, albeit virtually, at our Investor Day on June 16th. Thank you for your continued interest in Centene. I'll now hand the call over to Jeff. Thank you, Michael, and good morning, everyone. This morning, we reported first quarter 2021 results in what was a good start to the year. First quarter revenues were $30 billion, an increase of 15% compared to the first quarter of 2020, and adjusted diluted earnings per share was $1.63 compared to $0.86 last year. As a result of the strong first quarter performance, we increased our full year 2021 adjusted EPS guidance by $0.05 per share to a range of $5.05-$5.35. I will provide further comments related to our updated financial guidance shortly. First, let me provide additional details for the first quarter. Total revenues grew by $4 billion over the first quarter of 2020 due to a full quarter of contribution from WellCare and the ongoing suspension in Medicaid eligibility redeterminations, partially offset by an overall decrease in Marketplace membership, state rate and risk-sharing actions, and the repeal of the health insurer fee in 2021. Our Marketplace membership decline in the quarter was less significant than previously expected as a result of membership gains achieved during the special enrollment period. Total membership increased to 25.1 million in the quarter, up 5% compared to a year ago. Since the pandemic began in March of 2020, we have added a total of 2 million Medicaid members. Our HBR was 86.8% in the first quarter, compared to 88% in the first quarter of 2020. The HBR benefited from lower overall medical utilization trends due to COVID pandemic and lower costs associated with the flu. This was partially offset by COVID-related costs, state risk-sharing mechanisms, and higher COVID and traditional utilization in the Marketplace business. Our adjusted SG&A expense ratio was 8.1% in the first quarter this year, compared to 8.6% last year and 9.7% in the fourth quarter of 2020. The adjusted SG&A expense ratio benefited from the ongoing suspension of Medicaid eligibility redeterminations and a leveraging of expenses over higher revenues due to recent acquisitions. Cash flow provided by operations was $43 million in the first quarter. The lower operating cash flow for the quarter was primarily driven by a delay in premium payments of $910 million from the state of N.Y. due to the end of their fiscal year, which was collected in April. We continue to maintain a strong liquidity position of $369 million of unregulated cash on our balance sheet at quarter end. Debt at quarter end was $16.8 billion, which includes $152 million of borrowings on our revolving credit facility. Our debt-to-capital ratio was 38.5%, excluding our non-recourse debt, compared to 39% in the fourth quarter of 2020. Our debt-to-capital ratio was 38% when netting our unregulated cash with our debt at quarter end, which represents a 90-basis-point decrease since March of 2020. Our medical claims liability totaled $12.8 billion at quarter end and represents 49 days in claims payable, compared to 51 days in the fourth quarter of 2020. DCP was impacted by the timing of medical and pharmacy claim payments. We are making excellent progress toward the closure of Magellan, and we remain comfortable with our previously communicated accretion targets. Over the last several months, we have gained increased visibility into a number of important factors and have included those items in our updated 2021 financial guidance. These factors specifically include the ongoing suspension of Medicaid eligibility redeterminations through August 1st, the delay in the California pharmacy carve-out until July 1st, and the delay in the New York pharmacy carve-out through year-end 2022, the new business win in Oklahoma with an assumed go-live date of October 1st, expected Marketplace membership gains through the special enrollment period, Medicare membership fee schedule increase and sequestration delay, and updated expectations of state rate and risk-sharing mechanisms. These changes increased our total revenue guidance for the year by $4 billion at the midpoint to be within a range of $120.1 billion and $122.1 billion. Our HBR guidance increased by 50 basis points at the midpoint due to the mix of items such as the Medicare fee schedule, increased state risk-sharing mechanisms, and Medicaid growth, which all carry a higher HBR. Taken altogether, this has an overall neutral effect to earnings, and the dynamics are consistent with the headwinds and tailwinds we provided on our fourth quarter earnings call. Additionally, as I highlighted earlier, we have increased our adjusted diluted EPS guidance for the full year at the midpoint by $0.05, reflecting our strong first quarter performance. Let me highlight some more details on some of these items. We now expect Medicare Advantage enrollment growth to exceed 20% in 2021. This strong growth demonstrates the value of the WellCare acquisition, provides positive momentum for the organization to build off of as we formulate our bids for Medicare Advantage in 2022. As Michael mentioned, Marketplace enrollment expectations for 2021 are better than our previous estimates, as the special enrollment period provides Centene with an opportunity to reach many more eligible consumers. This strong growth demonstrates our organizational commitment to leadership in this product. We continue to view Marketplace as a long-term growth opportunity for Centene. We have increased our estimate for state rate and risk-sharing mechanisms from our previous guidance to $550 million for 2021. In the first quarter, the state of New York implemented a risk corridor retroactive to April 1st, 2020, that increased our payback by $40 million. At this time, we are not aware of any new corridors or retroactive rates, and the increase in our full-year estimate reflects the performance of risk mitigation programs enacted last year. As Michael noted, we continue to monitor utilization. During the first quarter, we saw overall utilization that continues to be below the historical baseline and also slightly lower than the fourth quarter of 2020. COVID inpatient admissions and costs peaked in January and decreased throughout the quarter. We continue to see a diverging pattern of COVID and non-COVID utilization. The updated financial guidance reflects typical utilization that remains below the historical baseline during the first half of 2021, continuing to trend to normalized levels by the end of the year. COVID utilization, including testing and treatment costs, are expected to partially offset the impact of lower traditional utilization. The duration and intensity of higher COVID costs will be impacted by the trajectory of the pandemic and vaccination rates. As Michael discussed, we continue to monitor some additional factors that are not in our updated guidance today. They include the potential for the additional SEP membership gains in Marketplace above our expectations, driven by the enhanced Advance Premium Tax Credits, the potential for Medicaid redeterminations to be extended beyond August 1st, any additional state rate and risk-sharing actions, and the uncertainty associated with both COVID and traditional medical utilization for the remainder of the year. We believe these additional factors represent a net tailwind to the company for the remainder of 2021. The seasonality of our earnings remains unchanged, with approximately 60% in the first half of the year. I'll close by reiterating our confidence in the strength of our business. Our balance sheet remains strong, and we believe we have ample liquidity to meet our operational and strategic needs. We remain focused on executing against our strategic plans and are committed to delivering shareholder value. That concludes my remarks, and operator, you may now open the line for questions. Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on a touchtone phone. If you're using a speakerphone, we ask that you please pick up your handset before pressing the keys. To withdraw your question, please press star then two. Today's first question comes from Joshua Raskin with Nephron Research. Please go ahead. Thanks. Good morning. Good morning. I think I'm still trying to Good morning, Michael. Still trying to process an Investor Day on a Wednesday, not a Friday. I'm a little off still. My real question is Medicare revenues, 41% of the quarter. I know some of that was anniversarying of WellCare, but MA Live grew up 19% sequentially. Sounds like the outlook for the year is closer to 20%, so that's up from previous expectations. Can you break out how much of that revenue growth was organic in the quarter? Maybe a sense of what revenues will do this year, and where are you seeing that success in terms of geographies and products and whether it's coming from competitors or fee for service? Yeah, I'll start off. I think the growth is very balanced across our various markets. There's no one market contributing. We've been expanding in the new markets very successfully. As we said when we went into the WellCare deal, we felt that they had some competencies in this area that we could build on. We also have a national presence as a total Centene Corporation, we've just been building on it organically, basically. Obviously, you take some from competition, just some of it is just from the fee for service. It's very balanced across all the potential elements for growth. There's no one contributing more than another. Just as a follow-up, I know the Star Ratings has been a big focus and you guys are looking for improvement. Should we think about 2022 as an improvement year? Not necessarily looking for another 20% growth year, but just in terms of positioning and margin, et cetera. Do you feel like better results, better competitive positioning going forward as well? Yeah, I think, well, first of all, I won't put a number on the growth until June. I like significant growth. I think people know it. We'll be working against that. Relative to the Stars, we were within a few basis points last year being at 4 Stars, and we have very aggressive programs, and as you know, it takes time to achieve that. It's a one or two-year look back. On the Stars front, we believe we'll continue to make progress on it, and we tell the Medicare people it's not just 4 Stars, but four and a half and beyond. We're reaching for the Stars, so to speak. It's very balanced in that way, Josh. Perfect. Thanks. Our next question today comes from Kevin Fischbeck with Bank of America. Please go ahead. Great, thanks. Just wanted to see how to think about the guidance, and how much we should be thinking about as being a good base, first for thinking about future growth. It sounds like most of the revenue guide is one time in nature. Is that fair? I guess, you're waiting for the Oklahoma contract, but most of the other things, whether it's sequestration or redeterminations or maybe even the special enrollment period might be things that we wouldn't necessarily flow through to the future year. I guess similar kind of question, but on MLR, it sounds like some of the MLR guidance is on items that are happening this year, but maybe you wouldn't expect to be in the baseline for next year. Just how do we think about those two dynamics? Yeah. Kevin, I'll start. We'll give you more guidance in June at our Investor Day, which is our practice, particularly on the top line. These are unusual years. We think that the redetermination will continue throughout the balance of the year, but we'll report it a quarter at 90 days at a time as the federal government does it. That's in the interest of being reasonably conservative. We're being cautious there. Marketplace, we've demonstrated this past quarter with the growth that we've had that we are the leader in the field and are in a very strong position to continue that growth. We're going to continue it through the balance of this year as we see it, and we see some upside there. I think what's also important as it relates to the redetermination, if they do drop off the redetermination, people who maybe lose Medicaid coverage could pick up the Marketplace because once again, the cost structure is such with the tax allowances that they can do that without any cost. I think we're going to see. I'm hearing a bird somewhere in the background. Yeah. I think we will see growth continue, but as we said, governmental policies do have something to play with, and it is a fluid situation, and we work very well, both sides of the aisle, as we've talked about in the past. We're working with them now on various policies and approaches. As that unfolds, I think between now and June, I hope to have more insight than we do as to what it will mean for the balance of this year and going into 2022. The essence is positive. There's a quick follow-up there. You mentioned that some [wait] corridors may expire. When would you get visibility on that? Pardon me? Well, just in terms of the states have just been not talking about adding to them, and we have talked about it. Their attitude is things seem to be stabilizing. I'm trying to give you a sense of where we are today and what we're seeing, and I'm not saying which specific ones, because it's moving around. We only had one adjustment this past quarter, which is a very positive sign. Once again, I'm trying to give you just some insight as we see it, Kevin. All right, great. Thanks. Our next question today comes from Justin Lake with Wolfe Research. Please go ahead. Thanks. Good morning. Good morning. A couple questions on the quarter. First, the PYD looked pretty strong, relative to last year. Was wondering if you could kind of parse out the impact that had on the quarter. Then you talked about the little bit higher cost on the Marketplace business. Any more color there you can give us in terms of what you're seeing there, any kind of geographies, then where margins kind of end up for this year, given that cost pressure. Thanks. Jeff, Do you want to take this? Sure, Justin. As we look at development, we obviously track this from quarter to quarter. We're looking for consistency. In our view, it's very consistent with what we've seen in the past. You have to obviously account for the acquisition of WellCare, but roughly around that 1% range of prior year medical costs. I would say nothing unusual on the development front from our perspective, which is, I think we've had a consistent practice over a long number of years. On the Marketplace business, on the cost side, what we did see was just a little bit higher inpatient authorizations on COVID, specifically in January, and then a little higher non-impatient, really just compared to our expectations. It doesn't really change the margin profile for the year. I would just say a tad higher than versus what we had modeled in Q1. Yeah, it could have a positive impact on risk adjustment for us. That's right. The other thing we're tracking is the acuity of our membership, and obviously the SEP members as well. That's all going to factor into the risk adjustment calculation, and that's relative to your competition, and the data on that doesn't come out until really the end of Q2. More to come on that. Great. Thanks for the call. Our next question today comes from A.J. Rice at Credit Suisse. Please go ahead. Thanks. Hi, everybody. I was interested in Michael's comments about the Marketplace or the public exchanges, and the narrow network competition. I think when you guys, obviously have been a big leader there the last few years, one of the secret sauces you've had was to approach it with a more limited network approach relative to some of the guys that came at it as a traditional commercial product. It now sounds like maybe some other competitors are leapfrogging and doing even more in that area. I'm wondering if you think about the membership and what's happening with the membership, I know it's a membership that's prone to switch, but is not driven by premiums because there's a lot of subsidies. Is it mainly networks that are driving people to pick and choose on the exchanges in your view at this point? Are there other things that are factors in driving how people choose? Is your strategy involved? I think what's important is we did see some significant pricing in the end of last year, that cost us the membership. As we said, that's because they had a narrow network, and we're able to do that. We opted not to join that race to the bottom and maintain our broader networks and not narrow networks. We're also seeing a commitment to customer service from enrollees. We're hearing this everywhere, that at the end of the day, people that left us in 2020, today in 2021, what they're finding is true commitment to a strong provider network and really focus on the customer. That's really fueling our growth. When you have a supportive administration, you have a Special Enrollment Period that's now going for 180 days, you have the enhanced tax credits being applied on April 1st, and really at the same time, we really have a commitment to a strong distribution strategy. This is leading to our growth. Okay. All right, thanks. Maybe just Jeff, the 90-day public health emergency, if that were to get extended to year-end, what would that mean for you guys? I'll give you a little flavor on the membership. I think we expect our membership to peak roughly 2.2 million members, since the pandemic began roughly in July. If it got extended, we think that'd go up to 2.4. We'd top out at 2.4 before the end of the year. Okay. All right. Thanks a lot. What that really means is we have recouped to date plus some, what we lost in the last quarter of last year. We see it continuing to grow significantly. Yep. Thanks. Our next question today comes from Matt Borsch with BMO Capital Markets. Please go ahead. Yes, good morning. Morning. Maybe I could ask you to talk about what you're seeing in terms of your profitability in Medicare Advantage. I'm asking the question just in the context of the impressive growth that you've shown there, but wondering if some of that has come at the expense of margin, and maybe that was planned. Well, we have not gotten specific by product line. I want to assure you, Matt, that everything we do will be driven by profit and with a view to expanding margins. I think we have a clear-cut approach to that. Matt, this is Jeff. A couple things. Obviously, as Michael mentioned, it's a unique year. We had the Medicare fee schedule cut, that's not helping, and then obviously we have a lot of room for margin expansion in the future years based on Stars performance. I think as you look at this year in isolation, I would say margin expansion opportunities going forward, primarily from eliminating the cut and then obviously performing better on Stars, which is one of the important tasks that we're focused on. Yeah. If I could ask a different question, on the Medicaid redeterminations. If we get into that, whether it's later this year or at the beginning of 2022, has your thinking in terms of the impact changed at all versus maybe what we had discussed, I'm thinking back at the December Investor Day? Well, I think I'll start off. I think it's important to say we're going to have a better view of that come the June Investor Day. I mean, that's typically where we talk about that. I did comment, though, that our position in the Marketplace, that if there is redetermination, if people lose Medicaid coverage, we believe that we will be in a position to where they will flip into our Marketplace so that it's the same network and things of that nature that would be a good incentive, and their costs are subsidized. I think that it's a matter of where that membership goes. Got it. Thank you. Our next question today comes from Scott Fidel with Stephens. Please go ahead. Hi. Thanks. Good morning. First question, just would be interested if you have any clarity for us on what you're learning just about the New York rates being updated, if at all. Obviously a lot of developments there in the New York budget more broadly after the ARP bill was passed. Interested if I know you guys called out the risk corridor, the retroactive one that was put in place, any updates to because I know there had been a 3% assumed cut previously in the budget, if you got an update on that. Also just on the quality payments in New York as well, which I know has been a dynamic for you guys, just where things are trending there as well. Yes, Scott, this is Jeff. I think it's just too early to tell. When these things aren't finalized, they have a tendency to move late in the game, as we've seen in the past. I guess from my perspective, I would say it's just too early to tell where it's going to land. We're comfortable, obviously, with what we have in the numbers for this year. Okay. Just a follow-up question. Saw that you guys have your updated view in the revenue guidance on the sort of start date of the carve-out of the Medi-Cal PBM contract. I know the state had announced that they were going to be conducting a review just around the Magellan acquisition and looking at some things. Interested at this point, has that review concluded and you've now gotten visibility from the state, or is that still ongoing, and if there has been any feedback so far on any changes that the state would be requiring as part of the Magellan acquisition? Thanks. Sarah, do you want to make a comment on that? It was her. Yeah, happy to. Magellan is working very closely with DHCS and California Department leadership on a conflict avoidance plan. That is still in process but progressing well. We don't yet have clarity from the Department on when the program would be kicked off, but we're hoping to have a sense within the next month or so of the resolution of that conflict avoidance plan. Okay, that start date that you have in the updated revenue guidance, that's just sort of an estimate at this point. Right. Okay, thanks. The next question today comes from Ricky Goldwasser with Morgan Stanley. Please go ahead. Yeah. Hi, good morning. Good morning. A question on utilization in the acuity level. Michael, you said that you are tracking acuity closely. What are you seeing to date in terms of the population that's coming back? What's the acuity levels on the core ex-COVID? When we think about, you're saying utilization is below baseline. I assume that that relates to core utilization as well. Maybe you can give us a little bit more color on how it's trending per market. Do you think that because you're now seeing sort of a mix towards more of an MA population, that that's impacting sort of utilization trends that you're seeing versus Medicaid in the market? Also, I think Jeff commented that in the Marketplace, we saw some incremental increase in utilization. I mean, that's offset some in Medicaid and that, but Jeff, why don't you take us through the numbers? Yeah. On the utilization front, a lot packed into that question, so I'm not sure I heard the final piece of that. We really haven't seen a change in the acuity outside of our expectations. Specifically, just take the Marketplace business. We knew our acuity was going to change based on the open enrollment, and that's why we commented that we think our risk adjustment payable will go down substantially this year. So far, I would say we haven't seen any acuity change in our base membership other than what we've expected. I hope that answers part of your question. If that doesn't, what was the second part? Yeah. To your point, no change in acuity versus your expectations. To add in that, what is embedded into guidance by year-end? Are you assuming unchanged acuity or higher acuity? The second part of the question was on the utilization. You said no change. I'm just kind of trying to understand how did it look for kind of like the Medicare population versus Medicaid. Yeah. Two things. I guess what I would say is we know the acuity of the members we have, right? We have projected that in our guidance. If you go to our prepared remarks, what we've said is we expect utilization to stay below the historical baseline for the first half, trending towards normal by the end of the year. I hope that helps. Yes, there is a difference in behavior between, I would say, Medicaid, Marketplace, and Medicare. The demographics of those members are extremely different from an age perspective. There are different utilization patterns, but we obviously incorporate that into our guidance. Okay. Thank you. Our next question today comes from Lance Wilkes with Bernstein. Please go ahead. Yeah, good morning. Good morning. Could you talk a little bit about your long-term strategic growth outlook at this point? In particular, was interested in how do you look at your major priorities beyond Medicaid and Marketplace, and how much of the growth long-term do you think are going to come from those areas like Medicare, healthcare enterprise, or value-based care? Thanks. Well, I appreciate the question. I think we'll get into more detail on 2022 growth. We give some sense of where it's coming from in June, which is our practice. We still see ourselves very much as a growth company. We see balanced growth across all the product lines. We demonstrated growth in Medicare. We've talked about that being a growth engine for us. We think Marketplace will continue to be a growth engine as well as Medicaid. I mean, we have a government in place now that believes that people should be insured. What we're working on now is to come up with the numbers for you that are reasonable, that we'll give you in June. We see us growing across all our products. Growing responsibly with expanding margins and containing costs and improving quality. It's a balance that we're trying to strike. We have a couple new products that we're working on that I'm not going to talk about for confidentiality reasons. Just to clarify on the healthcare enterprise and some of the things with value-based care delivery that maybe you're doing in Florida or places like that, how material are they to growth prospects over the next one, two, three years? Well, I think you're going to see that those things are put in place for long-term growth. We have some technology you're going to hear about at the June Investor Day that will drive growth and will drive demand for our products because of what it can do for the quality and, as our systems people like to talk about, the provider and recipient's delight. Just to be clear, for the technology, are those mainly drivers of the managed care business, or do you think those are standalone enablement businesses, like kind of in line with Magellan supporting other health plans? Oh, no. I think what you're going to see on the systems is it's going to drive improvement in quality and reduce cost. You'll have higher performance from a quality standpoint, improved quality, but it's going to significantly reduce our cost. Okay, thanks. Our next question today comes from Robert Jones with Goldman Sachs. Please go ahead. Great. Thanks for the questions. Actually, just wanted to go back to A.J.'s question about the competitive landscape, Michael, in the Marketplace. You've mentioned a few times, obviously, end of last year that you saw some more competitive pricing behaviors from some of the players there. Was wondering if maybe during the Special Enrollment Period, you've seen any of those competitors change behavior or continue with a more aggressive pricing strategy. I think within that, just curious, how widespread has this been? Is it really kind of contained to a state or two, or are you seeing it more broadly? No, I think it's not broad. I think, one, we're focused on ourselves and how we do things. As we said at the time, we're not going to join that race to the bottom. We know that's not something you're going to do, and it couldn't be sustained, in my opinion. What we've done is we've maintained our network. We have the subsidies that are necessary, that have really taken price off the table, in my opinion, where people will look at the quality, the service that Brent talked about. That's where we're seeing the growth and return of membership to us, as well as the incremental new membership. I think what we're really focused on is how to continue to grow it. I learned a long time ago when I was in consumer packaged goods, when you're trying to go in against somebody that's a clear leader in the marketplace, which we were in a category, the only way you can hope to try and come in is on price. I think we had a strategic positioning that people were able to take some membership away on price in a COVID environment as we come out of it. As I think we've demonstrated in the first quarter of this year, we've recouped all that we lost and then some, and we'll be giving you guidance in June that shows continued growth. Got it. That's helpful. I guess maybe just one quick follow-up, Jeff. I know at the Investor Day, you talked about the cadence of earnings maybe being a little bit more front half weighted. I think it was, like, 65%. Any updated thoughts, as you got one quarter under the belt now, as far as how you're seeing earnings play out for the year? I think in a 60% front half would be where I would direct you to. Again, if you just think about the utilization kind of assumptions that we have, that gives you the reason why there's more earnings in the front half of the year. Okay, great. Thank you. Our next question today comes from George Hill with Deutsche Bank. Please go ahead. Yeah, good morning, guys, and thanks for taking the questions. Jeff and Mike, just kind of a simple one. Can you talk about the vaccine initiatives and the uptake that you're seeing in the managed Medicaid population? My quick follow-up would be is I know that we've seen a continued suspension of the redeterminations, but we continue to see smatterings of press releases, as it relates to raising barriers to access, like increased use of prior auth and step edits coming out of various states. I'm wondering if you're seeing this, and is it having impact on utilization, or might it be too early to tell? Your first one was on the vaccine take-up rate. Obviously, part of what some of the initiatives that Michael had mentioned were, we're trying to stratify our membership population for those that are most at risk and trying to get the vaccination to them. I think some of the challenges we've had on the data side is that potential members could get vaccinations from alternative sites, so that's not within our ecosystem. We are tracking that data as best we can and trying to obviously get our high-risk members to get vaccinated. The second question, again? I didn't catch that last part. We subscribe to all the state Medicaid agency press release distribution lists, and we're starting to see a smattering of data flow around state agencies wanting to raise barriers to access. Reinstituting prior authorizations with care delivery, reinstituting step edits. I'm just wondering if you're seeing any of this, if you expect it to impact utilization. Will it be meaningful not seeing it? Any commentary on that? I would say it's early. I'm not aware if we've seen anything at this point in time, and that's something that we'll obviously be continuing to watch. Sure. I want to add one thing about the vaccine. That our focus has really been with the Gold Jacket from the Hall of Fame and others, is to help people that, in our population, that may be hesitant, for various historic reasons, to not take the vaccine, to say it's okay. Having people that are well-respected in sports and other areas. We had Bob Costas way back when do a public service announcement on wearing a mask. It's a matter of getting people that are respected, encouraging and providing an incentive. What we're trying to really focus on is they're not doing it just for themselves, but they're doing it for their loved ones. They're doing it for their parents, their children, their spouses, other members of their family. What's really important is just encouraging. That's where we spend a lot of time and energy and work with government officials to try and demonstrate that we're being responsible in that area. Thank you. Ladies and gentlemen, this concludes our question and answer session. I would like to turn the conference back over to the management team for any final remarks. Well, we thank you, and we look forward to Investor Day in the second quarter. As I said earlier, I believe we have the momentum to continue the positive impact we're having in the marketplace. Stay safe, everybody. Thank you. Thank you, sir. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines, and have a wonderful day.