UPDATED: Feb. 10 at 1 p.m. ET
CVS Health CEO David Joyner told investors on Tuesday that the recently proposed rates for the 2027 Medicare Advantage plan year don't fully account for the current environment.
The Centers for Medicare & Medicaid Services released the proposed 2027 Advance Notice in Medicare Advantage and Part D, where the agency said it it aiming for flat rates in MA in the coming year. Insurers have roundly criticized the movement as medical costs and utilization remain elevated.
Joyner said during the company's earnings call the team is "advocating for more appropriate funding to ensure adequate access as well as the stability and sustainability of a program relied on by more than half of the seniors in this country."
"The proposed rate simply does not match the level of medical cost trend in the industry," Joyner said.
He continued that while the proposed rates are disappointing, the company is still focused on making improvements to margins for its Aetna business, particularly in Medicare Advantage. The insurer is the third-largest player in the MA market, behind only UnitedHealthcare and Humana.
Joyner said that while the company believes flat 2027 rates are inadequate, it does support other proposals in the Advance Notice, such as steps to address "upcoding" practices that insurers can use to increase their federal payouts. CVS conducts in-home member assessments through its Signify Health unit, where providers evaluate the health and social factors for beneficiaries.
These home visits, Joyner said, are critical in identifying potential risks, reaching individuals in care deserts and bridging patients back into the healthcare system.
"We support CMS’s desire to align diagnosis-to-encounters with medical professionals," he said.
Steve Nelson, executive vice president of CVS and president of Aetna, echoed Joyner in comments on the call, saying that CMS' proposed rates "are simply not adequate based on the trends and the medical costs that we’ve seen."
He said the team is actively engaged with CMS in the rulemaking process to address that concern. The company has a wealth of data on utilization and cost trends that can support the need to update the final rates for 2027.
"We’re going to continue to engage and hopefully be helpful as we can," Nelson said. "It’s so important to the seniors that we serve to have access to these benefits and great healthcare that they need and deserve."
PUBLISHED: 7:45 a.m. ET
CVS Health beat the Street on both earnings and revenue in the fourth quarter, though its stocks were down premarket as its 2026 guidance disappointed analysts.
The healthcare giant posted $2.9 billion in profit for the fourth quarter of 2025, up from $1.6 billion in the prior-year quarter. Revenues in the fourth quarter were $105.7 billion, also an increase year over year from $97.7 billion in the fourth quarter of 2024.
Both figures surpassed analysts' predictions, per Zacks Investment Research.
For the full year, profits were $1.8 billion, down from $4.6 billion in profit for 2024. Revenues grew significantly, however, increasing from $372.8 billion in 2024 to $402.1 billion in 2025.
"Our fourth quarter and full-year results demonstrate the progress we are making in transforming the health care experience with our unique collection of businesses," CEO David Joyner said in a press release. "From lowering drug prices, to improving navigation of health care, to being the front door of care across our country, we are well positioned to achieve our ambition to be the most trusted health care company in America."
For 2026, the company expects to earn between $7 and $7.20 in earnings per share, a prediction that disappointed analysts, according to Seeking Alpha. Shares in CVS Health were down by 3.3% before the markets opened Tuesday morning.
As was the case for other major health plans, CVS' Aetna unit was stung by an ongoing trend toward elevated utilization and medical costs. In the fourth quarter, CVS reported a medical loss ratio of 94.8%, on part with the prior-year quarter and reflecting improvements in its government plans that were offset in part by changes made to Part D under the Inflation Reduction Act.
For the full year, MLR was 91.2%, down slightly from 2024's 92.5% ratio. CVS similarly attributed this to improvements in the government division.
Revenues at Aetna for the quarter were $36.3 billion, up from $32.95 billion in the fourth quarter of 2024. Revenues for the full year were also up, growing from $130.7 billion in 2024 to $143.4 billion in 2025.
Total membership as of Dec. 31 was 26.6 million, down by 112,000 compared to the third quarter. Membership decreased by 504,000 members compared to 2024, and CVS said that reflects decreases in both the marketplace and government segments.
At the company's pharmacy benefit management division, revenues were also up year over year, increasing from $47 billion in the fourth quarter of 2024 to $51.2 billion in the fourth quarter of 2025. For the full 2025, revenues at Caremark were $190.4 billion, up from $173.6 billion in 2024.
At CVS Pharmacy, revenues rose as well as the company filled 5.4% more prescriptions on a 30-day equivalent basis in 2025 compared to 2024. Revenues for the fourth quarter were $37.7 billion, up from $33.5 billion in the fourth quarter of 2024.
Full-year revenues for the pharmacy division were $139.4 billion, up from $124.5 billion in 2024.