The Ledger

Molina Healthcare’s book is shrinking and getting more expensive at the same time, and the company says its full-year profit guidance still holds. In its third-quarter 8-K, filed after the close Wednesday, the Medicaid managed-care insurer reported a consolidated medical care ratio (the share of premiums spent on care) of 92.9%, against 92.6% a year earlier, per its 10-Q. Premium revenue fell 4% to $10.46 billion on lower Medicaid and Marketplace membership. Net income fell 52% to $38 million, or $0.73 per diluted share. Ending membership was 4.86 million, including 4.37 million in Medicaid, 222,000 in Medicare and 267,000 in the ACA Marketplace. Molina reaffirmed 2026 premium revenue of about $42 billion and adjusted earnings per share of at least $5.25. That guidance already absorbs a $1.50 per share loss from its new Florida Medicaid contract, which starts in the fourth quarter, and a $1.00 per share loss from a traditional Medicare Advantage prescription drug plan it is exiting for 2027, a decision that carried a $93 million impairment in the nine months. Segment ratios were 93.0% in Medicaid, 93.0% in Medicare and 92.5% in the Marketplace. Who it hits: state Medicaid agencies setting rates and the hospitals and physician groups in Molina’s markets, where a ratio above 92% leaves the insurer little room and tends to bring pressure on provider contracts. So what: Elevance improved its ratio this week by narrowing its book; Molina’s ratio rose while its book shrank. Confidence: High on figures (primary filing); Low on whether the second-half cost trend lets guidance hold, since the release gives no segment ratio targets.

Quest Diagnostics raised its 2026 guidance after test volume jumped 14.5%, while the price it collects per test fell 4.2%. The Quest 8-K earnings release, issued today, shows third-quarter net revenue of $3.10 billion, up 10.0%, and adjusted diluted earnings per share of $3.00, up 15.4% from $2.60. Requisition volume grew 14.5%, with 14.4% organic. Full-year guidance now calls for revenue of $12.065 billion to $12.105 billion, up from $11.95 billion to $12.05 billion, and adjusted earnings per share of $11.25 to $11.35, up from $11.05 to $11.25. Quest also said it finalized an agreement to buy select outreach laboratory assets from a Northeastern U.S. health system that is a long-time customer of its Co-Lab Solutions unit, and that its joint venture laboratory with Corewell Health in Michigan is progressing. The release does not name the health system or the price. Who it hits: hospital systems weighing whether to keep or sell the outreach labs that serve community physicians, and independent labs competing for the volume. So what: more tests at a lower price each is the pattern of a consolidator absorbing hospital volume. Confidence: High on figures (primary filing); Low on the economics of the outreach deal.

Intuitive Surgical booked a $450 million antitrust settlement charge in the third quarter, even as revenue rose 22% to $3.05 billion. The Intuitive 8-K earnings release dated October 20 describes the charge as a one-time payment for an antitrust class action, about $0.99 per diluted share after tax (the release’s reconciliation table shows $1.00). That is why GAAP earnings per share were $1.49 against $3.00 on a non-GAAP basis. The surgical robot maker reported about 14% growth in da Vinci procedures and placed 546 da Vinci systems, 315 of them the newest da Vinci 5, up from 427 systems a year ago. Guidance for 2026 da Vinci procedure growth is about 14% to 15%, with the company expecting to land nearer the midpoint. Intuitive also recorded a $22 million after-tax benefit from tariff refunds under the International Emergency Economic Powers Act (IEEPA) and expects tariffs to cost about 0.9% of revenue otherwise. Who it hits: hospitals that buy and service da Vinci robots, which remain in demand at 546 placements in the quarter. The release does not say who the plaintiffs were or how the money is distributed, so we do not characterize it further. Confidence: High on figures (primary filing); Low on any effect on hospital pricing.

Centene reports third-quarter results Tuesday, and Molina has just set the comparison for a Medicaid and Marketplace insurer. Centene’s release is scheduled for about 6:00 a.m. Eastern on October 27 with a call at 8:30 a.m., per a finviz copy of the company’s notice (supplemental; we did not confirm it on Centene’s investor site). Humana’s release is November 6, per its Business Wire notice via finviz (supplemental). Watch Centene’s ratio in Medicaid and Marketplace against Molina’s 93.0% and 92.5%, and its membership trend. Confidence: Med on dates; no claims about results.

THE DEAL SHEET

Scan covered SEC filings, company releases and trade press for October 20 to 22. Larger transactions from this month, including Option Care Health, Viatris and Pacira, and the Rush and Endeavor merger, ran earlier or are outside the 24-hour window. No health system bankruptcy, rating action, closure, or FTC or DOJ healthcare merger action dated in the window could be confirmed from a primary source. Frontier scan this run: opioid treatment programs and correctional health contractors, no fresh 2026 business news found.