Centene executives emphasized the insurer's commitment to the Affordable Care Act's exchanges in a call with investors Wednesday morning.
On the company's third-quarter earnings call, CEO Sarah London said that even should the enhanced premium tax credits, which are at the center of the current federal government shutdown, expire as scheduled at the end of this year, there are still "millions and millions of Americans" who rely on the individual market for coverage.
She said the segment is also backstopped by the older premium tax credits, which reach a smaller population but do still make coverage more affordable on the exchanges for many. However, the current policy environment is the biggest factor in short-term stability, she said.
Major players in the marketplaces have faced significant financial headwinds as costs rise, driven in large part by program integrity measures set to reform this sector. London said the team has focused its efforts on pricing for margin recovery in 2026 and adjusting to these pressures.
"We haven't changed our commitment to this product," London said, "and we haven't really changed our view of what, philosophically, we should be able to price for long term."
She said that the promise of the exchanges is in allowing consumers greater choice in coverage options, which is why the company is bullish on the potential of individual coverage health reimbursement arrangements, or ICHRAs, which allow employers to offer a stipend to buy individual market coverage rather than a traditional health plan.
Using Centene as an example, it's difficult to truly customize and personalize coverage for unique needs across a population of 60,000 workers, London said.
"We obviously think that the individual market is a compelling chassis as we consider the future of insurance and a view that individuals are going to want more agency," London said. "They're going to want more affordability, portability."
Centene posted a $6.6 billion loss in the third quarter after incurring a one-time impairment charge related to ongoing market headwinds.
The company said in its earnings report, released Wednesday morning, that it began a quantitative analysis on whether its financial "goodwill," an intangible asset that follows an acquisition, had been impaired, a sign that a specific business' performance is declining.
Centene said in the release that it completed that deep dive in October and determined it would take a $6.7 billion impairment based on a number of market factors, including significant changes codified in the One Big Beautiful Bill Act and its sliding stock price.
With that charge stripped out, the company posted earnings per share of 50 cents in the quarter, which surpassed analysts' estimates, according to Zacks Investment Research.
Revenues were $49.7 billion in the quarter, which also beat Wall Street forecasts. By comparison, Centene reported $42 billion in revenue and $713 million in profit in the prior-year quarter.
Through the first nine months of 2026, the company posted $145.1 billion in revenue and $5.6 billion in losses. It brought in $122.3 billion in revenue and $3 billion in profit through the first three quarters of 2024, according to the report.
Given the impairment charge incurred in the quarter, Centene now expects a diluted loss of $12.85. However, it's boosting its adjusted earnings outlook to $2, up from its previous estimate of $1.75. The company's share price ticked up premarket on the results.
"Our third quarter results and increased full year outlook demonstrate tangible progress against the near-term milestones we laid out for investors in July," said London in the press release. "While much work remains ahead, our organization remains focused on driving margin improvement, delivering outcomes for our members, and positioning the business for long-term success."
Centene's total membership was just shy of 28 million in the third quarter, and its medical loss ratio was 92.7%, up from 89.2% a year ago. Elevated medical costs and utilization have been an ongoing problem across the health insurance industry and in multiple coverage types over the past year.
Centene slashed its outlook for 2025 in the second quarter due in large part to shifts in the Affordable Care Act marketplace segment. London told investors in July that the company saw a massive shift in morbidity year over year, driven by provider coding intensity and utilization trends, which led to significant cost pressure.
She said many of its marketplace plans were underpriced for program integrity changes that were rolled out by the Centers for Medicare & Medicaid Services in advance of the 2025 enrollment window. Several key provisions in that rule have been stayed by a federal judge.
The government also remains shut down as lawmakers debate an extension for the enhanced premium tax credits available to individuals on the exchanges, with open enrollment set to begin Saturday.
Editor's note: Updated12:00 p.m. ET on Oct. 29.