Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

Elevance Health, Inc.

CONSOLIDATED FINANCIAL STATEMENTS

Years ended December 31, 2025, 2024 and 2023

Contents

Reports of Independent Registered Public Accounting Firm (PCAOB ID:42)			69
Audited Consolidated Financial Statements:
Consolidated Balance Sheets			71
Consolidated Statements of Income			72
Consolidated Statements of Comprehensive Income			73
Consolidated Statements of Cash Flows			74
Consolidated Statements of Total Equity			75
Notes to Consolidated Financial Statements			76

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Report of Independent Registered

Public Accounting Firm

To the Shareholders and the Board of Directors of Elevance Health, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Elevance Health, Inc. (the Company) as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, cash flows and total equity for each of the three years in the period ended December 31, 2025, and the related notes and financial statement schedule listed in the Index at Item 15(c) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 6, 2026 expressed an unqualified opinion thereon.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to which it relates.

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Valuation of Incurred but Not Paid Claims
Description of the Matter						Medical claims payable was $17,084 million at December 31, 2025, a significant portion of which related to the Company’s estimate for claims that are incurred but not paid. As discussed in Note 2 to the consolidated financial statements, the Company’s liability for incurred but not paid claims is determined using actuarial methods that include a number of factors and assumptions, including completion factors, which represent the average percentage of total incurred claims that have been paid through a given date after being incurred, and trend factors, which represent an estimate of claims expense based on recent claims expense levels and healthcare cost levels. There is significant uncertainty inherent in determining management’s best estimate of completion and trend factors, which are used to calculate actuarial estimates of incurred but not paid claims.
						Auditing management’s estimate of incurred but not paid claims was complex and required the involvement of our actuarial specialists due to the highly judgmental nature of the completion and trend factor assumptions used in the valuation process. The significant judgment was primarily due to the sensitivity of management’s best estimate of completion and trend factor assumptions, which have a significant impact on the valuation of incurred but not paid claims.
How We Addressed the Matter in Our Audit						We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s actuarial process for estimating the liability for incurred but not paid claims. These audit procedures included among others, testing management review controls over completion and trend factor assumptions and the review and approval processes that management has in place for estimating the liability for incurred but not paid claims.
						To test the Company’s liability for incurred but not paid claims, our audit procedures included, among others, testing the completeness and accuracy of the underlying claims and membership data recorded in the source claims processing and disbursement systems to the data used by management in developing completion and trend factor assumptions and agreeing a sample of incurred and paid claims to source documentation. With the support of actuarial specialists, we evaluated the methodologies applied by the Company in determining the actuarially determined liability and management's actuarial assumptions, including trend and completion factor assumptions, used in their analysis based on historical claim experience and independently calculated a range of reasonable reserve estimates for comparison to management’s best estimate of the liability for incurred but not paid claims. Additionally, we performed a review of the prior period liabilities for incurred but not paid claims to subsequent claims development.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 1944.

Indianapolis, Indiana

February 6, 2026

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Elevance Health, Inc.

Consolidated Balance Sheets

			December 31, 2025						December 31, 2024
(In millions, except share data)
Assets
Current assets:
Cash and cash equivalents			$	9,491					$	8,288
Fixed maturity securities (amortized cost of $25,773 and $25,879; allowance for credit losses of $21 and $6)			25,884						25,201
Equity securities			740						1,192
Premium receivables			10,073						8,011
Self-funded receivables			5,162						5,044
Other receivables			6,307						6,016
Other current assets			5,344						4,700
Assets held for sale			—						490
Total current assets			63,001						58,942
Long-term investments:
Fixed maturity securities (amortized cost of $1,116 and $1,049; allowance for credit losses of $0 and $0)			1,121						1,035
Other invested assets			10,839						9,749
Property and equipment, net			4,679						4,652
Goodwill			28,344						28,277
Other intangible assets			11,200						12,094
Other noncurrent assets			2,310						2,140
Total assets			$	121,494					$	116,889
Liabilities and equity
Liabilities
Current liabilities:
Medical claims payable			$	17,084					$	15,746
Other policyholder liabilities			3,632						4,204
Unearned income			1,493						1,508
Accounts payable and accrued expenses			7,322						6,927
Short-term borrowings			150						365
Current portion of long-term debt			1,099						1,649
Other current liabilities			10,255						10,029
Liabilities held for sale			—						153
Total current liabilities			41,035						40,581
Long-term debt, less current portion			30,797						29,218
Reserves for future policy benefits			145						190
Deferred tax liabilities, net			2,110						2,148
Other noncurrent liabilities			3,381						3,326
Total liabilities			77,468						75,463
Commitments and Contingencies—Note 14
Shareholders’ equity
Preferred stock, without par value, shares authorized - 100,000,000; shares issued and outstanding - none			—						—
Common stock, par value $0.01, shares authorized - 900,000,000; shares issued and outstanding - 220,723,898 and 227,479,695			2						2
Additional paid-in capital			8,938						8,911
Retained earnings			35,393						33,549
Accumulated other comprehensive loss			(451)						(1,147)
Total shareholders’ equity			43,882						41,315
Noncontrolling interests			144						111
Total equity			44,026						41,426
Total liabilities and equity			$	121,494					$	116,889

See accompanying notes.

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Elevance Health, Inc.

Consolidated Statements of Income

			Years Ended December 31
(In millions, except per share data)			2025						2024						2023
Revenues
Premiums			$	164,639					$	144,166					$	142,854
Product revenue			24,470						22,630						19,452
Service fees			8,475						8,408						7,903
Total operating revenue			197,584						175,204						170,209
Net investment income			2,194						2,051						1,825
Net losses on financial instruments			(653)						(445)						(694)
Gain on sale of business			—						201						—
Total revenues			199,125						177,011						171,340
Expenses
Benefit expense			148,223						127,567						124,330
Cost of products sold			21,178						19,750						17,293
Operating expense			20,984						20,025						20,087
Interest expense			1,402						1,185						1,030
Amortization of other intangible assets			628						580						885
Total expenses			192,415						169,107						163,625
Income before income tax expense			6,710						7,904						7,715
Income tax expense			1,049						1,933						1,724
Net income			5,661						5,971						5,991
Net loss (gain) attributable to noncontrolling interests			1						9						(4)
Shareholders’ net income			$	5,662					$	5,980					$	5,987
Shareholders’ earnings per share
Basic			$	25.28					$	25.81					$	25.38
Diluted			$	25.21					$	25.68					$	25.22

See accompanying notes.

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Elevance Health, Inc.

Consolidated Statements of Comprehensive Income

			Years Ended December 31
(In millions)			2025						2024						2023
Net income			$	5,661					$	5,971					$	5,991
Other comprehensive income (loss), net of tax:
Change in net unrealized gains/losses on investments			633						103						1,117
Change in non-credit component of impairment losses on investments			(1)						1						—
Change in net unrealized gains/losses on cash flow hedges			8						4						18
Change in net periodic pension and other benefit costs			67						60						40
Change in future policy benefits			(3)						(2)						(3)
Foreign currency translation adjustments			(4)						(6)						(1)
Other comprehensive income (loss)			700						160						1,171
Net loss (gain) attributable to noncontrolling interests			1						9						(4)
Other comprehensive (income) loss attributable to noncontrolling interests			(4)						6						6
Total shareholders’ comprehensive income			$	6,358					$	6,146					$	7,164

See accompanying notes.

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Elevance Health, Inc.

Consolidated Statements of Cash Flows

			Years Ended December 31
(In millions)			2025						2024						2023
Operating activities
Net income			$	5,661					$	5,971					$	5,991
Adjustments to reconcile net income to net cash provided by operating activities:
Net losses on financial instruments			653						445						694
Gain on sale of business			—						(201)						—
Equity in net (earnings) losses of other invested assets			(398)						(1)						33
Depreciation and amortization			1,546						1,393						1,745
Deferred income taxes			(279)						(374)						(602)
Impairment of property, equipment and right-of-use assets			108						103						446
Share-based compensation			276						191						289
Changes in operating assets and liabilities:
Receivables, net			(2,526)						(683)						(1,762)
Other invested assets			—						(78)						(79)
Other assets			57						824						(675)
Policy liabilities			228						(1,840)						147
Unearned income			(15)						(113)						290
Accounts payable and other liabilities			(720)						(272)						1,640
Income taxes			(297)						404						(103)
Other, net			(4)						39						7
Net cash provided by operating activities			4,290						5,808						8,061
Investing activities
Purchases of investments			(15,026)						(17,986)						(16,236)
Proceeds from sale of investments			13,324						16,547						10,596
Maturities, calls and redemptions from investments			1,771						2,025						2,940
Changes in securities lending collateral			(385)						73						78
Purchases of subsidiaries, net of cash acquired			88						(4,809)						(1,552)
Proceeds from sales of subsidiaries, net of cash sold			—						363						—
Purchases of property and equipment			(1,116)						(1,256)						(1,296)
Other, net			—						(124)						(102)
Net cash used in investing activities			(1,344)						(5,167)						(5,572)
Financing activities
Proceeds from long-term borrowings, net issuance costs			2,991						7,710						2,574
Repayments of long-term borrowings			(2,147)						(1,650)						(1,909)
Proceeds from short-term borrowings			1,505						275						225
Repayments of short-term borrowings			(1,720)						(135)						(265)
Changes in securities lending payable			386						(75)						(77)
Changes in bank overdrafts			1,312						(638)						114
Repurchase and retirement of common stock			(2,605)						(2,900)						(2,676)
Cash dividends			(1,529)						(1,508)						(1,395)
Proceeds from issuance of common stock under employee stock plans			79						221						152
Taxes paid through withholding of common stock under employee stock plans			(32)						(109)						(99)
Other, net			22						2						7
Net cash provided by (used in) financing activities			(1,738)						1,193						(3,349)
Effect of foreign exchange rates on cash and cash equivalents			(5)						(6)						(1)
Change in cash and cash equivalents			1,203						1,828						(861)
Cash and cash equivalents at beginning of year			8,288						6,526						7,387
Less cash and cash equivalents included in assets held for sale at end of year			—						(66)						—
Cash and cash equivalents at end of year			$	9,491					$	8,288					$	6,526

See accompanying notes.

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Elevance Health, Inc.

Consolidated Statements of Total Equity

			Total Shareholders’ Equity
			Common Stock												Additional Paid-in Capital												Accumulated Other Comprehensive Income (Loss)						Noncontrolling Interests						Total Equity
(In millions)			Number of Shares						Par Value									Retained Earnings
January 1, 2023			238.0						$	2					$	9,084					$	29,647					$	(2,490)					$	87					$	36,330
Net income (loss)			—						—						—						5,987						—						4						5,991
Other comprehensive income (loss)			—						—						—						—						1,177						(6)						1,171
Noncontrolling interests and other adjustments			—						—						—						—						—						14						14
Repurchase and retirement of common stock			(5.8)						—						(217)						(2,481)						—						—						(2,698)
Dividends and dividend equivalents			—						—						—						(1,404)						—						—						(1,404)
Issuance of common stock under employee stock plans, net of related tax benefits			0.9						—						342						—						—						—						342
Convertible debenture repurchases and conversions			—						—						(341)						—						—						—						(341)
December 31, 2023			233.1						2						8,868						31,749						(1,313)						99						39,405
Net income			—						—						—						5,980						—						(9)						5,971
Other comprehensive income (loss)			—						—						—						—						166						(6)						160
Noncontrolling interests and other adjustments			—						—						—						—						—						27						27
Repurchase and retirement of common stock, including excise tax			(6.7)						—						(262)						(2,662)						—						—						(2,924)
Dividends and dividend equivalents			—						—						—						(1,518)						—						—						(1,518)
Issuance of common stock under employee stock plans, net of related tax benefits			1.1						—						305						—						—						—						305
December 31, 2024			227.5						2						8,911						33,549						(1,147)						111						41,426
Net income (loss)			—						—						—						5,662						—						(1)						5,661
Other comprehensive income (loss)			—						—						—						—						696						4						700
Noncontrolling interests and other adjustments			—						—						—						58						—						30						88
Repurchase and retirement of common stock, including excise tax			(7.5)						—						(296)						(2,341)						—						—						(2,637)
Dividends and dividend equivalents			—						—						—						(1,535)						—						—						(1,535)
Issuance of common stock under employee stock plans, net of related tax benefits			0.7						—						323						—						—						—						323
December 31, 2025			220.7						$	2					$	8,938					$	35,393					$	(451)					$	144					$	44,026

See accompanying notes.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements

December 31, 2025

(In Millions, Except Per Share Data or As Otherwise Stated Herein)

1. Organization

References to the terms “we,” “our,” “us” or “Elevance Health” used throughout these Notes to Consolidated Financial Statements refer to Elevance Health, Inc., an Indiana corporation, and unless the context otherwise requires, its direct and indirect subsidiaries. References to the “states” include the District of Columbia and Puerto Rico, unless the context otherwise requires.

Elevance Health is a health company with the purpose of improving the health of humanity. We are one of the largest health insurers in the United States in terms of medical membership, serving approximately 45.2 million medical members through our affiliated health plans as of December 31, 2025. We offer a broad spectrum of network-based managed care risk-based plans to Individual, Employer Group, Medicaid and Medicare markets. In addition, we provide a broad array of managed care services to fee-based customers, including claims processing, stop loss insurance, care provider network access, medical management, care management, wellness programs, actuarial services and other administrative services. Across these markets, we generate revenue through risk-based premiums, administrative fees from self-funded employers and pharmacy and health service fees through our Carelon businesses. We provide services to the federal government in connection with our Federal Health Products & Services business, which administers the Federal Employee Program® (“FEP®”). We provide an array of specialty services both to customers of our subsidiary health plans and to unaffiliated health plans, including pharmacy services, stop loss insurance, dental, vision and supplemental health insurance benefits, as well as integrated health services.

We are an independent licensee of the Blue Cross and Blue Shield Association (“BCBSA”), an association of independent health benefit plans. We serve our members as the Blue Cross licensee for California and as the Blue Cross and Blue Shield (“BCBS”) licensee for Colorado, Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri (excluding 30 counties in the Kansas City area), Nevada, New Hampshire, New York (in the New York City metropolitan area and upstate New York), Ohio, Virginia (excluding the Northern Virginia suburbs of Washington, D.C.) and Wisconsin. In a majority of these service areas, we do business as Anthem Blue Cross and Anthem Blue Cross and Blue Shield. We also conduct business through arrangements with other BCBS licensees as well as other strategic partners. In addition, we serve members in numerous states as Wellpoint, Carelon, MMM and/or Simply Healthcare. We are licensed to conduct insurance operations in all 50 states, the District of Columbia and Puerto Rico through our subsidiaries.

Our portfolio consists of the following core go-to-market brands:

• Anthem Blue Cross/Anthem Blue Cross and Blue Shield — represents our Anthem-branded and affiliated Blue Cross and/or Blue Shield licensed Medicare, Medicaid, and commercial Health Benefit plans;

• Wellpoint — represents our Wellpoint branded Medicare, Medicaid and commercial Health Benefit plans and other non-BCBSA brands; and

• Carelon — represents our healthcare related services and capabilities, including our CarelonRx and Carelon Services businesses.

We report our results of operations in the following four reportable segments: Health Benefits, CarelonRx, Carelon Services and Corporate & Other (our businesses that do not individually meet the quantitative thresholds for an operating segment, as well as corporate expenses not allocated to our other reportable segments). For additional discussion, see Note 20, “Segment Information.”

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

2. Basis of Presentation and Significant Accounting Policies

Basis of Presentation: The accompanying consolidated financial statements include the accounts of Elevance Health and its subsidiaries and have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”). All significant intercompany accounts and transactions have been eliminated in consolidation. Our consolidated financial statements include the accounts of Elevance Health, Inc. and subsidiaries that we control, including variable interest entities for which we are the primary beneficiary. We are considered the primary beneficiary if we have the power to direct the variable interest entity's most significant economic activities, and we have the right to receive benefits or obligations to absorb losses that could be significant to the entity. We evaluate the following criteria: (1) the structure and purpose of the entity; (2) the risks and rewards created by and shared through the entity; and (3) our ability to direct its activities, receive its benefits and absorb its losses relative to the other parties involved with the entity.

Certain of our subsidiaries operate outside of the United States and have functional currencies other than the U.S. dollar (“USD”). We translate the assets and liabilities of those subsidiaries to USD using the exchange rate in effect at the end of the period. We translate the revenues and expenses of those subsidiaries to USD using the average exchange rates in effect during the period. The net effect of these translation adjustments is included in “Foreign currency translation adjustments” in our consolidated statements of comprehensive income.

Use of Estimates: The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes. Our most significant estimate relates to estimates and judgments for medical claims payable. Actual results could differ from those estimates.

Cash and Cash Equivalents: Cash and cash equivalents includes available cash and all highly liquid investments with maturities of three months or less when purchased. We control a number of bank accounts that are used exclusively to hold customer funds for the administration of customer benefits, and we have cash and cash equivalents on deposit to meet certain regulatory and contractual requirements. These amounts totaled $348 and $409 at December 31, 2025 and 2024, respectively, and are included in the cash and cash equivalents line on our consolidated balance sheets.

Investments: We classify fixed maturity securities in our investment portfolio as “available-for-sale” and report those securities at fair value. Certain fixed maturity securities are available to support current operations and, accordingly, we classify such investments as current assets without regard to their contractual maturity. Investments used to satisfy contractual, regulatory or other requirements are classified as long-term, without regard to contractual maturity.

If a fixed maturity security is in an unrealized loss position and we have the intent to sell the fixed maturity security, or it is more likely than not that we will have to sell the fixed maturity security before recovery of its amortized cost basis, we write down the fixed maturity security’s cost basis to fair value and record an impairment loss in our consolidated statements of income. For impaired fixed maturity securities that we do not intend to sell or if it is more likely than not that we will not have to sell such securities, but we expect that we will not fully recover the amortized cost basis, we recognize the credit component of the impairment as an allowance for credit loss in our consolidated balance sheets and record an impairment loss in our consolidated statements of income. The non-credit component of the impairment is recognized in accumulated other comprehensive loss. Furthermore, unrealized losses entirely caused by non-credit-related factors related to fixed maturity securities for which we expect to fully recover the amortized cost basis continue to be recognized in accumulated other comprehensive loss.

The credit component of an impairment is determined primarily by comparing the net present value of projected future cash flows with the amortized cost basis of the fixed maturity security. The net present value is calculated by discounting our best estimate of projected future cash flows at the effective interest rate implicit in the fixed maturity security at the date of purchase. For mortgage-backed and asset-backed securities, cash flow estimates are based on assumptions regarding the underlying collateral, including prepayment speeds, vintage, type of underlying asset, geographic concentrations, default rates, recoveries and changes in value. For all other securities, cash flow estimates are driven by assumptions regarding probability of default, including changes in credit ratings and estimates regarding timing and amount of recoveries associated with a default.

For asset-backed securities included in fixed maturity securities, we recognize income using an effective yield based on anticipated prepayments and the estimated economic life of the securities. When estimates of prepayments change, the

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

effective yield is recalculated to reflect actual payments to date and anticipated future payments. The net investment in the securities is adjusted to the amount that would have existed had the new effective yield been applied since the purchase date of the securities. Such adjustments are reported within net investment income.

The changes in fair value of our marketable equity securities are recognized in our results of operations within net gains and losses on financial instruments. Certain marketable equity securities are held to satisfy contractual obligations and are reported under the caption “Other invested assets” in our consolidated balance sheets.

We have investments in limited partnerships (“LPs”) and companies in which our ownership interest may enable us to influence the operating or financial decisions of the investee company, including unconsolidated variable interest entities. These investments are accounted for using the equity method of accounting and are reported within “Other invested assets” in our consolidated balance sheets. Our proportionate share of equity in net income for these LPs and unconsolidated investee companies is reported within “Net investment income” in our consolidated statements of income. The carrying value of these investments are written down, or impaired, to fair value when a decline in value is considered to be other-than temporary. In applying the equity method (including assessment for other-than temporary impairment), we use financial information provided by the LPs and investee companies, generally on a one-to three-month lag. We consolidate investee companies in certain other instances where it is deemed to exercise control, or is considered the primary beneficiary of a variable interest entity.

Mortgage loans on real estate are classified as held for investment and are reported at their amortized cost basis net of loss allowance under the caption “Other invested assets” in our consolidated balance sheets. Amortized cost is the amount at which the loan is originated, adjusted for accrued interest, amortization of premium, discount and net deferred fees or costs, collection of cash and write-offs.

We have corporate-owned life insurance policies on certain participants in our deferred compensation plans and other members of management. The cash surrender value of the corporate-owned life insurance policies is reported under the caption “Other invested assets” in our consolidated balance sheets.

Investment income is recorded when earned. All securities sold resulting in investment realized gains and losses are recorded on the trade date. Realized gains and losses are determined on the basis of the cost or amortized cost of the specific securities sold.

We participate in securities lending programs whereby marketable securities in our investment portfolio are transferred to independent brokers or dealers in exchange for cash and securities collateral. Under Financial Accounting Standards Board (“FASB”) guidance related to accounting for transfers and servicing of financial assets and extinguishments of liabilities, we recognize the collateral as an asset, which is reported in “Other current assets” on our consolidated balance sheets, and we record a corresponding liability for the obligation to return the collateral to the borrower, which is reported in “Other current liabilities.” The securities on loan are reported in the applicable investment category on our consolidated balance sheets. Unrealized gains or losses on securities lending collateral are included in accumulated other comprehensive income as a separate component of shareholders’ equity. The market value of loaned securities and that of the collateral pledged can fluctuate in non-synchronized fashions. To the extent the loaned securities’ value appreciates faster or depreciates slower than the value of the collateral pledged, we are exposed to the risk of the shortfall. As a primary mitigating mechanism, the loaned securities and collateral pledged are marked to market on a daily basis and the shortfall, if any, is collected accordingly. Secondarily, the collateral level is set at 102% of the value of the loaned securities, which provides a cushion before any shortfall arises. The investment of the cash collateral is subject to market risk, which is managed by limiting the investments to higher quality and shorter duration instruments.

Receivables: Receivables are reported net of amounts for expected credit losses. The allowance for doubtful accounts is based on historical collection trends, future forecasts and our judgment regarding the ability to collect specific accounts.

Premium receivables include the uncollected amounts from insured groups, individuals and government programs. Premium receivables are reported net of an allowance for doubtful accounts of $167 and $183 at December 31, 2025 and 2024, respectively.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

Self-funded receivables include administrative fees, claims and other amounts due from fee-based customers. Self-funded receivables are reported net of an allowance for doubtful accounts of $145 and $115 at December 31, 2025 and 2024, respectively.

Other receivables include pharmacy rebates, provider advances, claims recoveries, reinsurance receivables, proceeds due from brokers on investment trades that have not yet settled, accrued investment income and other miscellaneous amounts due to us. These receivables are reported net of an allowance for doubtful accounts of $1,509 and $1,385 at December 31, 2025 and 2024, respectively. During the year ended December 31, 2025, we realized a $264 settlement with a value-based care provider, which allowed us to release $129 from the allowance for doubtful accounts. Of the settlement amount, $154 pertains to services rendered in 2024, with the remaining $110 attributable to 2025.

Income Taxes: We file a consolidated U.S. federal income tax return. Deferred income tax assets and liabilities are recognized for temporary differences between the financial statement and tax return basis of assets and liabilities based on enacted tax rates and laws and are reported net on our consolidated balance sheets. The deferred tax benefits of the deferred tax assets are recognized to the extent realization of such benefits is more likely than not. Deferred income tax expense or benefit generally represents the net change in deferred income tax assets and liabilities during the year, excluding the impact from amounts initially recorded for business combinations, if any, and amounts recorded to accumulated other comprehensive income. Current income tax expense represents the tax consequences of revenues and expenses currently taxable or deductible on various income tax returns for the year reported.

The Internal Revenue Code subjects a U.S. shareholder to tax on Global Intangible Low-Taxed Income (“GILTI”) earned by certain foreign subsidiaries. We have elected to account for GILTI tax in the year the tax is incurred.

The Inflation Reduction Act of 2022 includes a provision that imposes a new corporate alternative minimum tax (the “Corporate AMT”) that became effective for us beginning January 1, 2023. We have elected to account for the effects of the Corporate AMT on deferred tax assets and carryforwards and tax credits in the period they arise. We have also elected to disregard Corporate AMT when evaluating the need for a valuation allowance for non-Corporate AMT deferred tax assets. We do not believe the Corporate AMT will have a material impact on our consolidated financial position, results of operations, cash flows or related disclosures. Also, the Inflation Reduction Act of 2022 imposes an excise tax on the fair market value of net stock repurchases made after December 31, 2022. These are included as a charge to retained earnings as a component of the repurchase and retirement of common stock. Additionally, the One Big Beautiful Bill Act (“OBBBA”) signed into law on July 4, 2025, included various tax policy changes. We do not believe the OBBBA will have a material impact on our consolidated financial position.

We account for income tax contingencies in accordance with FASB guidance that contains a model to address uncertainty in tax positions and clarifies the accounting for income taxes by prescribing a minimum recognition threshold, which all income tax positions must achieve before being recognized in the financial statements.

Property and Equipment: Property and equipment is recorded at cost, net of accumulated depreciation. Depreciation is computed principally by the straight-line method over estimated useful lives ranging from fifteen to thirty years for buildings and improvements, three to five years for computer equipment and software, and seven years for furniture and other equipment. Leasehold improvements are depreciated over the term of the related lease. Certain costs related to the development or purchase of internal-use software are capitalized and amortized over estimated useful lives ranging from three to ten years.

Goodwill and Other Intangible Assets: FASB guidance requires business combinations to be accounted for using the acquisition method of accounting, and it also specifies the types of acquired intangible assets that are required to be recognized and reported separately from goodwill. Goodwill represents the excess of the cost of acquisition over the fair value of net assets acquired, including other intangible assets. Other intangible assets represent the values assigned to customer relationships, provider and hospital networks, Blue Cross and Blue Shield and other trademarks, licenses and other agreements, such as non-compete agreements. Goodwill and other intangible assets are allocated to reportable segments based on the relative fair value of the components of the businesses acquired.

Goodwill and other intangible assets with indefinite lives are not amortized but are tested for impairment at least annually. Goodwill and other intangible assets are allocated to reporting units for purposes of the annual goodwill impairment test. Other intangible assets with indefinite lives, such as trademarks, are tested for impairment separately. We complete our

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annual impairment tests of existing goodwill and other intangible assets with indefinite lives during the fourth quarter of each year. Our impairment tests require us to make assumptions and judgments regarding the estimated fair value of our reporting units, including goodwill and other intangible assets with indefinite lives. Certain interim impairment tests are also performed when potential impairment indicators exist or changes in our business or other triggering events occur.

FASB guidance allows for qualitative assessments of whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount for purposes of a goodwill impairment analysis and whether it is more likely than not that an indefinite-lived intangible asset is impaired for purposes of an indefinite-lived intangible asset impairment analysis. Estimated fair values developed based on our assumptions and judgments might be different if other reasonable assumptions and estimates were to be used. Qualitative analysis involves assessing situations and developments that could affect key drivers used to evaluate whether the fair value of our goodwill and indefinite-lived intangible assets is impaired. Our procedures include assessing our financial performance, macroeconomic conditions, industry and market considerations, various asset specific factors, and entity specific events.

Quantitative analysis must be performed if qualitative analyses are not conclusive. Entities also have the option to bypass the assessment of qualitative factors and proceed directly to performing quantitative analyses. Fair value for purposes of a quantitative goodwill impairment test is calculated using a blend of the projected income and market valuation approaches. The projected income approach is developed using assumptions about future revenue, expenses and net income derived from our internal planning process. Our assumed discount rate is based on our industry’s weighted-average cost of capital and reflects volatility associated with the cost of equity capital. Market valuations include market comparisons to publicly traded companies in our industry and are based on observed multiples of certain measures including revenue; earnings before interest, taxes, depreciation and amortization (“EBITDA”); and book value of invested capital.

A goodwill impairment loss is recognized to the extent that the carrying amount exceeds the asset’s estimated fair value. This determination consists of a one-step test comparing the estimated fair value of a reporting unit, including goodwill, to its carrying amount. If the carrying amount of a reporting unit exceeds its estimated fair value, an impairment loss is recognized. This goodwill impairment loss is equal to the excess of the reporting unit’s carrying amount over its estimated fair value, which is recorded in the results of operations.

Fair value for purposes of a quantitative impairment test for indefinite-lived intangible assets is estimated using a projected income approach. We recognize an impairment loss when the estimated fair value of indefinite-lived intangible assets is less than the carrying value, which is recorded in the results of operations. If significant impairment indicators are noted relative to other intangible assets subject to amortization, we may be required to record impairment losses against future income.

Derivative Financial Instruments: We primarily invest in the following types of derivative financial instruments: interest rate swaps, futures, forward contracts, put and call options, collars, swaptions, embedded derivatives and warrants. Derivatives embedded within non-derivative instruments, such as options embedded in convertible fixed maturity securities, are bifurcated from the host instrument when the embedded derivative is not clearly and closely related to the host instrument. Our use of derivatives is limited by statutes and regulations promulgated by the various regulatory bodies to which we are subject, and by our own derivative policy. Our derivative use is generally limited to hedging purposes, on an economic basis, and we generally do not use derivative instruments for speculative purposes.

We have exposure to economic losses due to interest rate risk arising from changes in the level or volatility of interest rates. We attempt to mitigate our exposure to interest rate risk through active portfolio management, including rebalancing our existing portfolios of assets and liabilities, as well as changing the characteristics of investments to be purchased or sold in the future. In addition, derivative financial instruments are used to modify the interest rate exposure of certain liabilities or forecasted transactions. These strategies include the use of interest rate swaps and forward contracts, which are used to lock-in interest rates or to hedge, on an economic basis, interest rate risks associated with variable rate debt. We have used these types of instruments as designated hedges against specific liabilities.

All investments in derivatives are recorded as assets or liabilities at fair value, except certain put and call options on large blocks of equity securities. Put and call options on large blocks of equity securities are initially recorded at fair value; however, they are not subsequently marked to market. If certain correlation, hedge effectiveness and risk reduction criteria are met, a derivative may be specifically designated as a hedge of exposure to changes in fair value or cash flow. The

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accounting for changes in the fair value of a derivative depends on the intended use of the derivative and the nature of any hedge designation thereon. Amounts excluded from the assessment of hedge effectiveness, if any, are reported in results of operations immediately. If the derivative is not designated as a hedge, the gain or loss resulting from the change in the fair value of the derivative is recognized in results of operations in the period of change. Cash flows associated with the settlement of non-designated derivatives are shown on a net basis in investing activity in our consolidated statements of cash flow.

From time to time, we may also purchase derivatives to hedge, on an economic basis, our exposure to foreign currency exchange fluctuations associated with the operations of certain of our subsidiaries. We generally use futures or forward contracts for these transactions. We generally do not designate these contracts as hedges and, accordingly, the changes in fair value of these derivatives are recognized in results of operations immediately.

As part of our international operations, we conduct transactions in foreign currencies, which exposes us to risks associated with fluctuations in foreign currency exchange rates. To manage this exposure, we utilize forward contracts to hedge expenses that are denominated in currencies other than the U.S. dollar. These forward contracts are designated as cash flow hedges and qualify for hedge accounting treatment under the applicable accounting standards.

Credit exposure associated with non-performance by the counterparties to derivative instruments is generally limited to the uncollateralized fair value of the asset related to instruments recognized in the consolidated balance sheets. We attempt to mitigate the risk of non-performance by selecting counterparties with high credit ratings and monitoring their creditworthiness and by diversifying derivatives among multiple counterparties. At December 31, 2025, we believe there were no material concentrations of credit risk with any individual counterparty.

We generally enter into master netting agreements, which reduce credit risk by permitting net settlement of transactions with the same counterparty. Certain of our derivative agreements also contain credit support provisions that require us or the counterparty to post collateral if there are declines in the derivative fair value or our credit rating. The derivative assets and derivative liabilities are reported at their fair values net of collateral and netting by the counterparty.

Retirement Benefits: We recognize the funded status of pension and other postretirement benefit plans on the consolidated balance sheets based on fiscal year-end measurements of plan assets and benefit obligations. Prepaid pension benefits represent prepaid costs related to tax-qualified defined benefit pension plans and are reported with “Other noncurrent assets”. Prepaid postretirement benefits represent prepaid costs related to retiree medical, life, vision and dental benefits and are reported with “Other noncurrent assets”. Benefit obligations related to unqualified defined benefit pension plans are recorded with “Other noncurrent liabilities”.

We determine the expected return on plan assets using the calculated value of plan assets, which recognize changes in the fair value of plan assets in a systematic manner over three years. We apply a corridor approach to amortize unrecognized actuarial gains or losses. Under this approach, only accumulated net actuarial gains or losses in excess of 10% of the greater of the projected benefit obligation or the fair value of plan assets are amortized over the average remaining service or lifetime of the plan participants as a component of net periodic benefit cost.

The discount rate reflects the current rate at which the pension liabilities could be effectively settled at the end of the year based on our most recent measurement date. We use the annual spot rate approach for setting our discount rate. Under the spot rate approach, individual spot rates from a full yield curve of published rates are used to discount each plan’s cash flows to determine the plan’s obligations.

Medical Claims Payable: Liabilities for medical claims payable include estimated provisions for incurred but not paid claims on an undiscounted basis, as well as estimated provisions for expenses related to the processing of claims. Incurred but not paid claims include (1) an estimate for claims that are incurred but not reported; (2) claims reported to us but not yet processed through our systems; and (3) claims reported to us and processed through our systems but not yet paid.

Liabilities for claims incurred but not reported and reported but not yet processed through our systems are determined in the aggregate, employing actuarial methods that are commonly used by health insurance actuaries and meet Actuarial Standards of Practice. Our reserving practice for claim liabilities is to consistently recognize the appropriate amount of reserve within a level of confidence required by Actuarial Standards of Practice. We determine the amount of the liability for incurred but not yet reported or processed claims by following a detailed actuarial process that uses both historical claim

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payment patterns as well as emerging medical cost trends to project our best estimate of claim liabilities. Under this process, historical paid claims data is formatted into “claim triangles,” which compare claim incurred dates to the dates of claim payments. This information is analyzed to create “completion factors” that represent the average percentage of total incurred claims that have been paid through a given date after being incurred. Completion factors are applied to claims paid through the period-end date to estimate the ultimate claim expense incurred for the period. Actuarial estimates of incurred but not paid claim liabilities are then determined by subtracting the actual paid claims from the estimate of the ultimate incurred claims.

For the most recent incurred months (typically the most recent two months), the percentage of claims paid for claims incurred in those months is generally low. This makes the completion factor methodology less reliable for such months. Therefore, incurred claims for recent months are not projected from historical completion and payment patterns; rather, they are projected by estimating the claims expense for those months based on recent claims expense levels and healthcare trend levels (“trend factors”).

On a regular basis, we review cost trends and utilization assumptions set upon initial establishment of claim liabilities. We utilize subsequent paid claims activity to monitor and continuously adjust the claims liability and benefit expense. If actual results are determined to be materially different than assumptions regarding cost trends and utilization, future periods of our income statement and overall financial position could be impacted.

Premium deficiencies are recognized when it is probable that expected claims plus administrative expenses will exceed future premiums on existing medical insurance contracts without consideration of investment income. For purposes of evaluating premium deficiencies, contracts are deemed to be either short or long duration and are grouped in a manner consistent with our method of acquiring, servicing and measuring the profitability of such contracts. Once established, reserves for premium deficiencies are released commensurate with actual claims experience over the remaining life of the contract.

Benefit expense includes incurred medical claims as well as quality improvement expenses for our risk-based members. Quality improvement activities are those designed to improve member health outcomes, prevent hospital readmissions and improve patient safety. They also include expenses for wellness and health promotion provided to our members.

Other Policyholder Liabilities: Other policyholder liabilities include rate stabilization reserves associated with retrospectively rated insurance contracts and certain case-specific reserves. Rate stabilization reserves represent accumulated premiums that exceed what customers owe us based on actual claim experience. The timing of payment of these retrospectively rated refunds is based on the contractual terms with our customers and can vary from period to period based on the specific contractual requirements.

Other policyholder liabilities also include liabilities for premium refunds based upon the minimum medical loss ratio (“MLR”). We are required to meet certain minimum MLR thresholds prescribed by the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010, as amended (collectively, the “ACA”). If we do not meet or exceed the minimum MLR thresholds specified by the ACA, we are required to pay rebates to certain customers. Minimum MLR rebates are calculated by subsidiary, state and applicable line of business in accordance with regulations issued by the U.S. Department of Health and Human Services (“HHS”). Such calculations are made using estimated calendar year medical loss expense and premiums, as defined by HHS.

We follow HHS guidelines for determining the types of expenses that may be included in our minimum MLR rebate calculations, which differ from benefit expense and premiums as reported in our consolidated financial statements prepared in conformity with GAAP. Certain amounts reported as expense in our consolidated GAAP financial statements may be reported as a reduction of premiums in accordance with HHS regulations. In addition, profit amounts included in our payments to third-party administrative service providers are recorded as benefit expense in our consolidated GAAP financial statements, while HHS does not allow for the inclusion of these expenses within the medical loss expense for purposes of calculating minimum MLR.

Also included are our risk-adjustment payables for certain risk-adjustment programs. The risk-adjustment programs reallocate funds from insurers with lower risk populations to insurers with higher risk populations based on the relative risk scores of participants. We estimate our payable based on the risk of our customers compared to the risk of other customers in the same state and market, considering data obtained from industry studies and HHS. Payables are recorded as adjustments to

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premium revenue based on our year-to-date experience when the amounts are reasonably estimable and collection is reasonably assured. Final revenue adjustments are determined by HHS in the year following the policy year.

Reserves for Future Policy Benefits: Future policy benefits include liabilities for insurance policies for which some of the premiums received in earlier years are intended to pay anticipated benefits to be incurred in future years. Future policy benefits are continually monitored and reviewed, and when reserves are adjusted, differences are reflected in benefit expense.

We believe that our liabilities for future policy benefits, along with future premiums received, are adequate to satisfy our ultimate benefit liability; however, these estimates are inherently subject to a number of variable circumstances. Consequently, the actual results could differ materially from the amounts recorded in our consolidated financial statements.

Revenue Recognition: Premiums for risk-based contracts are recognized as revenue over the period insurance coverage is provided, and, if applicable, net of amounts recognized for MLR rebates, risk adjustment, reinsurance and risk corridor under contractual premium stabilization arrangements, the ACA or other regulatory requirements. Premiums may also include performance incentives and penalties, which are recognized based on contractual terms. We estimate amounts receivable and payable under these contractual terms, and to the extent that such estimated amounts vary from the final amounts paid, the adjustments are included in earnings in the period of final settlement. Premium payments from contracted government agencies are based on eligibility lists produced by the government agencies. Premium payments related to the unexpired contractual coverage periods are reflected in the accompanying consolidated balance sheets as Unearned income. Premiums include revenue adjustments for retrospectively rated contracts where revenue is based on the estimated loss experience of the contract. Premium rates for certain lines of business are subject to approval by the Department of Insurance of each respective state. Additionally, delays in annual premium rate changes from contracted government agencies require that we defer the recognition of any increases to the period in which the premium rates become final. The value of the impact can be significant in the period in which it is recognized depending on the magnitude of the premium rate increase, the membership to which it applies and the length of the delay between the effective date of the rate increase and the final contract date. Premium rate decreases are recognized in the period the change in premium rate becomes effective and the change in the rate is known, which may be prior to the period when the contract amendment affecting the rate is finalized.

Service fees include revenue from certain group contracts that provide for the group to be at risk for all, or with supplemental insurance arrangements, a portion, of their claims experience. We charge these fee-based groups an administrative fee, which is based on the number of members in a group and the group’s claim experience. In addition, service fees include amounts received for the administration of Medicare, certain other government programs, and administrative services arrangements of our Carelon subsidiaries. Generally, each fee-based arrangement includes services which constitute a single suite of services provided and for which consideration is based upon an agreed-upon rate, regardless of the amount of services provided in a given period. As with premiums, each fee-based arrangement may include terms with retroactive rate or membership adjustments, performance incentives and penalties, each of which is a form of variable consideration within the transaction price. As such, each fee-based arrangement contains a single performance obligation that constitutes a series, and revenue is recognized over time as the services are performed. All benefit payments under these programs are excluded from benefit expense.

The determination of whether services are distinct performance obligations that should be accounted for separately or combined as one unit of accounting may require significant judgment. The estimation of variable consideration to be recognized requires significant judgment in the determination of the level of achievement of performance incentives, service level achievements subject to performance penalties, and the completion level of tasks subject to implementation fees.

Product revenue represents services performed by CarelonRx for unaffiliated pharmacy customers and includes ingredient costs (net of any rebates or discounts), including co-payments made by or on behalf of the customer, and service fees. Unaffiliated pharmacy customers include our fee-based groups that have contracted with CarelonRx for pharmacy services and third-party health plans. Product revenues and costs of goods sold for our affiliated health plans are eliminated in consolidation, excluding co-payments and subsidies made by or on behalf of affiliated customers. Product revenue for pharmacy services is recognized using the gross method at the negotiated contract price when CarelonRx has concluded that it is the principal, and it controls the services before prescription drugs are transferred to the customer. CarelonRx determines whether it is the principal due to its contractual rights to design and develop a listing of prescription drugs offered to the customer (formulary management); its control over establishing the pharmacy network available to the customer to have its prescription fulfilled (network management); and its discretion over establishing the pricing for prescription drugs. Overall,

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control over these activities indicate CarelonRx is primarily responsible for fulfilling the promise to provide pharmacy services. CarelonRx recognizes revenue when control of the prescription drugs is transferred to customers, in an amount it expects to be entitled to in exchange for the products or services provided.

For our non-risk-based contracts, we had no material contract assets, contract liabilities or deferred contract costs recorded on our consolidated balance sheets at December 31, 2025 or 2024. Revenue recognized in 2025 and 2024 from performance obligations related to prior years, such as due to changes in transaction price, was not material. For contracts that have an original expected duration of greater than one year, revenue expected to be recognized in future periods related to unfulfilled contractual performance obligations and contracts with variable consideration related to undelivered performance obligations is not material.

Cost of Products Sold: CarelonRx’s cost of products sold includes the cost of prescription drugs dispensed to unaffiliated pharmacy customers (net of rebates or discounts). Cost of products sold includes per-claim administrative fees for prescription fulfillment by its vendor and certain CarelonRx direct costs related to sales and administration of customer contracts.

Share-Based Compensation: Our current compensation philosophy provides for share-based compensation, including stock options, restricted stock awards and an employee stock purchase plan. Stock options are granted for a fixed number of shares with an exercise price at least equal to the fair value of the shares at the date of the grant. Restricted stock awards are issued at the fair value of the stock on the grant date. The employee stock purchase plan allows for a purchase price per share which is 90% of the fair value of a share of common stock on the lower of the first or last trading day of the plan quarter. The employee stock purchase plan discount is recognized as compensation expense based on GAAP guidance. All other share-based payments to employees are recognized as compensation expense in our consolidated statements of income based on their fair values. Additionally, excess tax benefits, which result from actual tax benefits realized when awards vest or options are exercised exceeding deferred tax benefits previously recognized based on grant date fair value, are recognized as tax benefits in the consolidated statements of income.

Advertising and Marketing Costs**:** We use print, broadcast and other advertising to promote our products and to develop our corporate image. We market our products through direct marketing activities and an extensive network of independent agents, brokers and retail partnerships for Individual and Medicare customers, and for certain Employer Group risk-based customers with a smaller employee base. Products for our Employer Group risk-based customers with a larger employee base are generally sold through independent brokers or consultants retained by the customer who work with industry specialists from our in-house sales force. In the Individual and Group markets, we offer products through state or federally facilitated marketplaces, or Public Exchanges, and off-exchange products. The cost of advertising and marketing for product promotion is expensed as incurred, while advertising and marketing costs associated with our corporate image are expensed when first aired. Total advertising and marketing expense was $395, $540 and $599 for the years ended December 31, 2025, 2024 and 2023, respectively.

Leases: We lease office space and certain computer and related equipment under noncancelable operating leases. We determine whether an arrangement is or contains a lease at its inception. We recognize lease liabilities based on the present value of the minimum lease payments not yet paid by using the lease term, any amounts probable of being owed under any residual value guarantees and the discount rate determined at lease commencement. As our leases do not generally provide an implicit rate, we use our incremental secured borrowing rate commensurate with the underlying lease terms to determine the present value of our lease payments. Our lease liabilities may include amounts for options to extend or terminate a lease when it is reasonably certain that we will exercise that option. We recognize operating right-of-use (“ROU”) assets at an amount equal to the lease liability adjusted for prepaid or accrued rent, the remaining balance of any lease incentives and unamortized initial direct costs.

The operating lease liabilities are reported in “Other current liabilities” and “Other noncurrent liabilities” and the related ROU assets are reported in Other noncurrent assets on our consolidated balance sheets. Lease expense for our operating leases is calculated on a straight-line basis over the lease term and is reported in operating expense on our consolidated statements of income. For our office space leases, we account for the lease and non-lease components (such as common area maintenance) as a single lease component. We also do not recognize a lease liability or ROU asset for our office space leases whose lease terms, at commencement, are twelve months or less and that do not include a purchase option or option to extend that we are reasonably certain to exercise.

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We assess our ROU assets for impairment when there are indicators of impairment and compare the carrying amount of the ROU asset to its estimated undiscounted future cash flows. If the estimated undiscounted future cash flows are less than the carrying amount of the ROU asset, an impairment calculation is performed. An impairment loss is recorded for the difference of the ROU asset’s carrying value that exceeds its estimated discounted cash flows. During the years ended December 31, 2025, 2024 and 2023, we recorded $7, $17 and $23, respectively, for impairment and abandonment of ROU assets. See Note 18, “Leases,” for additional information about the ROU asset impairment and abandonment charges.

Shareholders’ Earnings per Share: Earnings per share amounts, on a basic and diluted basis, have been calculated based upon the weighted-average common shares outstanding for the period.

Basic shareholders’ earnings per share excludes dilution and is computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted shareholders’ earnings per share may include the dilutive effect of stock options, restricted stock and convertible debentures, using the treasury stock method. The treasury stock method assumes exercise of stock options and vesting of restricted stock, with the assumed proceeds used to purchase common stock at the average market price for the period. The difference between the number of shares assumed issued and the number of shares assumed purchased represents the dilutive shares.

Recently Adopted Accounting Guidance: In November 2023, the FASB issued Accounting Standards Update No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). The amendments in ASU 2023-07 are intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 became effective for our fiscal year beginning after December 15, 2023, and for interim periods within our fiscal year beginning after December 15, 2024. We adopted these amendments on January 1, 2024, using the retrospective approach. Accordingly, the amendments were applied to all prior periods presented in the financial statements, and significant segment expense categories and amounts for prior periods are based on the categories identified and disclosed in the period of adoption. The adoption of ASU 2023-07 did not have an impact on our results of operations or our consolidated cash flows.

In November 2020, the FASB issued Accounting Standards Update No. 2020-11, Financial Services—Insurance (Topic 944): Effective Date and Early Application (“ASU 2020-11”). The amendments in ASU 2020-11 changed the effective date and early application of Accounting Standards Update No. 2018-12, Financial Services—Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts, which was issued in November 2018. The amendments in ASU 2020-11 extended the original effective date by one year to our interim and annual reporting periods beginning after December 15, 2022. This standard requires us to review cash flow assumptions for our long-duration insurance contracts at least annually and recognize the effect of changes in future cash flow assumptions in net income. This standard also requires us to update discount rate assumptions quarterly and recognize the effect of changes in these assumptions in other comprehensive income. The rate used to discount our reserves for future policy benefits will be based on an estimate of the yield for an upper-medium grade fixed-income instrument with a duration profile matching that of our liabilities. In addition, this standard changes the amortization method for deferred acquisition costs. We adopted these amendments on January 1, 2023, using the modified retrospective transition method for changes to the liability for future policy benefits and deferred acquisition costs as of the transition date, January 1, 2021. While the adoption did not have an overall material impact, our prior period financial statements presented in this Annual Report on Form 10-K have been restated to reflect the impacts of our adoption as required by the new standard. A balance sheet adjustment of ($64) was made to shareholders’ equity and total equity for the year ended December 31, 2022.

In December 2023, the FASB issued Accounting Standards Update No. 2023-09, Income Taxes (Topic 740) (“ASU 2023-09”). The amendments in ASU 2023-09 are intended to improve income tax disclosures, primarily related to the rate reconciliation and income taxes paid information. ASU 2023-09 became effective for our fiscal year beginning after December 15, 2024. We adopted these amendments on January 1, 2025 and applied the amendments on a prospective basis. The adoption of ASU 2023-09 did not have a material impact on our consolidated financial statements. Our Income Taxes footnote disclosure was updated to reflect adoption of the standard.

In August 2023, the FASB issued Accounting Standards Update No. 2023-05, Business Combinations—Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement (“ASU 2023-05”). ASU 2023-05 clarifies existing guidance to reduce diversity in practice and requires a joint venture to recognize and initially measure its assets and liabilities using a new basis of accounting, at fair value, upon formation. We adopted ASU 2023-05 as of January 1, 2025 and applied

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the amendments on a prospective basis. The adoption of ASU 2023-05 did not have an impact on our consolidated financial statements and disclosures.

Recent Accounting Guidance Not Yet Adopted: In November 2024, the FASB issued Accounting Standards Update No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”). This standard requires additional expense breakdowns in the footnotes for items such as inventory purchases, employee compensation, depreciation, and intangible asset amortization. Public companies must also provide a qualitative description of remaining expense amounts not separately disclosed, as well as the definition and total amount of selling expenses. ASU 2024-03 is effective for our fiscal year beginning after December 15, 2026, and for interim periods within our fiscal year beginning after December 15, 2027. The amendments are to be applied either prospectively to financial statements issued for reporting periods after the effective date of the update, or retrospectively to all prior periods presented in the financial statements. We are currently evaluating the effects the adoption of ASU 2024-03 will have on our consolidated financial statements and related disclosures.

In July 2025, the FASB issued Accounting Standards Update No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”). This standard introduces a practical expedient for all entities when estimating expected credit losses on current accounts receivable and contract assets arising from transactions under Accounting Standards Codification Topic (“ASC”) 606. Under the practical expedient, entities may assume that conditions at the balance sheet date remain unchanged over the life of the asset, reducing the need to prepare complex macroeconomic forecasts for short-term balances. ASU 2025-05 is effective for our fiscal years beginning after December 15, 2025, and interim periods within such fiscal years, with prospective application required. Early adoption is permitted. We have assessed the impact of adopting ASU 2025-05 and is not expected to have a material impact on our consolidated financial statements and disclosures.

In September 2025, the FASB issued Accounting Standards Update No. 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”). This standard modernizes the accounting for internal-use software by removing references to prescriptive development stages and instead requiring capitalization of costs once (1) management has authorized and committed to funding the software project, and (2) it is probable the project will be completed and placed in service. Entities must evaluate whether there is “significant development uncertainty,” such as unresolved novel functionality or substantially revised performance requirements, before meeting this capitalization threshold. ASU 2025-06 is effective for our fiscal years beginning after December 15, 2027, and interim periods within such fiscal years, with early adoption permitted. Entities may adopt the amendments prospectively, retrospectively, or under a modified transition approach. We are currently evaluating the impact of ASU 2025-06 on our consolidated financial statements and related disclosures.

There were no other new accounting pronouncements that were issued or became effective during the year ended December 31, 2025 that had, or are expected to have, a material impact on our financial position, results of operations, cash flows or financial statement disclosures.

3. Business Acquisitions

Completed Acquisitions

On December 31, 2024, we completed our acquisition of Centers Plan for Healthy Living LLC and Centers for Specialty Care Group IPA, LLC (“Centers”). Centers is a managed long-term care plan that serves New York state Medicaid and dual-eligible Medicaid/Medicare members, enabling adults with long-term care needs and disabilities to live safely and independently in their own home. This acquisition aligns with our strategic plan to grow the Health Benefits segment and leverage industry-leading expertise while serving Medicaid and dual-eligible populations. As of December 31, 2025, the purchase price was allocated to the tangible and intangible net assets acquired based on management's initial estimates of their fair values, of which $211 has been allocated to finite-lived intangible assets, $690 to indefinite-lived intangible assets and $202 to goodwill. The majority of the goodwill is not deductible for income tax purposes. As of December 31, 2025, the initial accounting for the acquisition was finalized. The proforma effects of this acquisition for prior periods were not material to our consolidated results of operations.

On December 10, 2024, we completed our acquisition of RSV QOZB LTSS, Inc. and certain affiliated entities (“CareBridge”), a value-based healthcare company that manages home and community-based services for Medicaid and dual-

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Notes to Consolidated Financial Statements (continued)

eligible members receiving long-term services and support. This acquisition aligns with Carelon Services’ care at home strategy, and our vision to be an innovative, valuable and inclusive healthcare partner by providing care management programs that improve the lives of the people we serve. As of December 31, 2025, the purchase price was allocated to the tangible and intangible net assets acquired based on management's initial estimates of their fair values, of which $305 has been allocated to finite-lived intangible assets and $1,827 to goodwill. The majority of the goodwill is not deductible for income tax purposes. As of December 31, 2025, the initial accounting for the acquisition was finalized. The proforma effects of this acquisition for prior periods were not material to our consolidated results of operations.

During the year ended December 31, 2025, in total, we completed business combinations for total cash consideration of approximately $414. The purchase prices for all business combinations were preliminarily allocated to the tangible and intangible net assets acquired based on management's initial estimates of their fair values. Tangible net assets acquired were $193, and intangible assets, for which 100% were allocated to our Health Benefits reportable segment, were $221, of which $100 was allocated to finite-lived intangible assets and $121 to goodwill. The majority of goodwill is not deductible for income tax purposes. As of December 31, 2025, the initial accounting for these acquisitions had not been finalized. Any subsequent adjustments made to the assets acquired or liabilities assumed during the measurement period may result from a purchase price adjustment, or will be recorded as an adjustment to goodwill and/or intangible assets acquired. The unaudited pro-forma effects of these acquisitions for prior periods were not material to our consolidated results of operations.

During the year ended December 31, 2024, in total, we completed business combinations for total cash consideration of approximately $5,128. The purchase prices for all business combinations were preliminarily allocated to the tangible and intangible net assets acquired based on management's initial estimates of their fair values. Tangible net assets acquired were $(236) and intangible assets were $5,364 of which $1,872 was allocated to finite-lived intangible assets, $426 to indefinite-lived intangible assets, and $3,066 to goodwill. Of these amounts, $2,641was allocated to our Carelon Services reportable segment, $1,594 was allocated to our CarelonRx reportable segment, and $1,129 to our Health Benefits reportable segment. The majority of goodwill is not deductible for income tax purposes. As of December 31, 2025, the accounting for the acquisitions was finalized. The unaudited pro-forma effects of these acquisitions for prior periods were not material to our consolidated results of operations.

Acquired tangible assets (liabilities) at the acquisition date were:

			2025						2024
Cash, cash equivalents and short-term investments			$	498					$	484
Accounts receivable and other current assets			93						847
Property, equipment and other long-term assets			6						309
Medical claims and other policyholder liabilities payable			(404)						(154)
Accounts payable and other current liabilities			(19)						(1,005)
Other long-term liabilities			(2)						(242)
Deferred tax assets (liabilities)			21						(475)
Total net tangible assets (liabilities)			$	193					$	(236)

The preliminary purchase price allocations for the various 2025 business combinations are subject to adjustment as valuation analyses, primarily related to contingent and tax liabilities, are finalized.

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Notes to Consolidated Financial Statements (continued)

Acquisition date fair values and weighted-average useful lives assigned to intangible assets include:

			2025												2024
			Fair Value						Weighted Average Useful Life						Fair Value						Weighted Average Useful Life
Customer-related			$	100					15 years						$	1,621					20 years
Provider and hospital relationships			—						10 years						70						10 years
Other			—						8 years						181						8 years
State Medicaid licenses			—						—						426						—
Total intangible assets			$	100											$	2,298

The results of operations and financial condition of acquired entities have been included in our consolidated results and the results of the corresponding operating segment as of the date of acquisition. Through December 31, 2025, the impact of the acquired entities on revenue and net earnings was not material. Unaudited pro-forma revenues for the years ended December 31, 2025, 2024 and 2023, as if the acquisitions had occurred at the beginning of the year, were immaterial.

4. Business Optimization Initiatives

2023-2024 Business Efficiency Program

During the third quarter of 2023, based on a strategic review of our operations, assets and investments, management implemented the “2023-2024 Business Efficiency Program” to enhance operating efficiency, refine the focus of our investments and optimize our physical footprint. The 2023-2024 Business Efficiency Program included the write-off of certain information technology assets and contract exit costs, a reduction in staff including the relocation of certain job functions, and the impairment of assets associated with the closure or partial closure of data centers and offices. The 2023-2024 Business Efficiency Program was finalized as of December 31, 2024. All material cash outlays associated with this program were paid as of December 31, 2025.

In 2025, we released $55 from our severance accrual. Payments related to employee termination costs for the 2023-2024 Business Efficiency Program during the year ended December 31, 2025 were $130

In 2024, we incurred $268 of costs towards the 2023-2024 Business Efficiency Program. This included primarily $72 of pre-tax charges for information technology asset write-offs, $165 of pre-tax personnel-related charges for the reduction and/or relocation of staff, which includes severance and related costs primarily determined under our existing severance plans, and $31 of pre-tax charges from asset impairments related to the closure or partial closure of offices, including operating lease-related ROU assets and other property and equipment. Payments related to employee termination costs for the 2023-2024 Business Efficiency Program during the year ended December 31, 2024 were $132.

In 2023, we incurred $752 of expense, which included $468 of pre-tax charges for information technology assets and contract write-offs related to projects that have been de-prioritized and stopped, $230 of pre-tax personnel-related charges for the reduction and/or relocation of workforce, which includes severance and related costs primarily determined under our existing severance plans, and $54 of pre-tax charges from asset impairments related to the closure or partial closure of data centers and offices, including operating lease-related ROU assets and other property and equipment. Payments related to employee termination costs during the year ended December 31, 2023 were $40.

These charges in each of these years were recognized in “Operating expense” in the Corporate & Other segment; see Note 20, “Segment Information.”

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Notes to Consolidated Financial Statements (continued)

5. Investments

A summary of current and long-term fixed maturity securities, available-for-sale, at December 31, 2025 and 2024 is as follows:

			Cost or Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Allowance For Credit Losses						Estimated Fair Value
December 31, 2025
Fixed maturity securities:
United States Government securities			$	1,512					$	10					$	(19)					$	—					$	1,503
Government sponsored securities			80						2						(1)						—						81
Foreign government securities			13						—						—						—						13
States, municipalities and political subdivisions, tax-exempt			3,701						76						(74)						(2)						3,701
Corporate securities			13,498						419						(130)						(4)						13,783
Residential mortgage-backed securities			3,203						43						(136)						(3)						3,107
Commercial mortgage-backed securities			2,078						28						(31)						(2)						2,073
Other asset-backed securities			2,804						53						(103)						(10)						2,744
Total fixed maturity securities			$	26,889					$	631					$	(494)					$	(21)					$	27,005
December 31, 2024
Fixed maturity securities:
United States Government securities			$	1,907					$	2					$	(85)					$	—					$	1,824
Government sponsored securities			156						—						(5)						—						151
Foreign government securities			19						—						(2)						—						17
States, municipalities and political subdivisions, tax-exempt			3,142						33						(123)						—						3,052
Corporate securities			14,095						192						(367)						(4)						13,916
Residential mortgage-backed securities			3,274						13						(236)						—						3,051
Commercial mortgage-backed securities			1,801						8						(60)						(1)						1,748
Other asset-backed securities			2,534						36						(92)						(1)						2,477
Total fixed maturity securities			$	26,928					$	284					$	(970)					$	(6)					$	26,236

Other asset-backed securities primarily consist of collateralized loan obligations and other debt securities.

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Notes to Consolidated Financial Statements (continued)

For fixed maturity securities in an unrealized loss position at December 31, 2025 and 2024, the following table summarizes the aggregate fair values and gross unrealized losses by length of time those securities have continuously been in an unrealized loss position.

			Less than 12 Months																		12 Months or Greater
			Number of Securities						Estimated Fair Value						Gross Unrealized Loss						Number of Securities						Estimated Fair Value						Gross Unrealized Loss
(Securities are whole amounts)
December 31, 2025
Fixed maturity securities:
United States Government securities			18						$	460					$	(3)					17						$	167					$	(16)
Government sponsored securities			4						—						—						16						29						(1)
Foreign government securities			1						3						—						2						1						—
States, municipalities and political subdivisions, tax-exempt			213						486						(8)						522						848						(66)
Corporate securities			568						1,398						(22)						839						1,397						(108)
Residential mortgage-backed securities			169						282						(4)						1,164						1,012						(132)
Commercial mortgage-backed securities			80						308						(6)						212						479						(25)
Other asset-backed securities			154						657						(28)						174						275						(75)
Total fixed maturity securities			1,207						$	3,594					$	(71)					2,946						$	4,208					$	(423)
December 31, 2024
Fixed maturity securities:
United States Government securities			40						$	1,240					$	(52)					25						$	330					$	(33)
Government sponsored securities			10						89						(2)						36						42						(3)
Foreign government securities			2						15						(1)						2						2						(1)
States, municipalities and political subdivisions, tax-exempt			527						1,092						(22)						661						943						(101)
Corporate securities			1,415						4,717						(92)						1,317						2,645						(275)
Residential mortgage-backed securities			306						1,097						(25)						1,312						1,291						(211)
Commercial mortgage-backed securities			136						670						(15)						297						661						(45)
Other asset-backed securities			123						293						(9)						236						735						(83)
Total fixed maturity securities			2,559						$	9,213					$	(218)					3,886						$	6,649					$	(752)

Unrealized losses on our securities shown in the table above have not been recognized into income because, as of December 31, 2025, we do not intend to sell these investments, and it is likely that we will not be required to sell these investments prior to their anticipated recovery. The declines in fair values are largely due to elevated interest rates driven by the higher rate of inflation and other market conditions.

Allowances for credit losses have been recorded in the amounts of $21 and $6 at December 31, 2025 and 2024, respectively, for declines in fair value due to unfavorable changes in the credit quality characteristics that impact our assessment of collectability of principal and interest.

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Notes to Consolidated Financial Statements (continued)

The amortized cost and fair value of fixed maturity securities at December 31, 2025, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay obligations.

			Amortized Cost						Estimated Fair Value
Due in one year or less			$	241					$	238
Due after one year through five years			4,271						4,305
Due after five years through ten years			10,502						10,697
Due after ten years			6,594						6,585
Mortgage-backed securities			5,281						5,180
Total fixed maturity securities			$	26,889					$	27,005

Equity Securities

A summary of current equity securities at December 31, 2025 and 2024 is as follows:

			December 31, 2025						December 31, 2024
Equity Securities:
Exchange traded funds			$	650					$	1,002
Common equity securities			35						118
Private equity securities			55						72
Total			$	740					$	1,192

Other Invested Assets

Other invested assets include non-controlled joint ventures, including our minority interest ownership of approximately 40% of Augusta Topco Holdings, L.P. (“Mosaic Health”) and our 40% minority interest ownership of Project Freedom Holdings, LLC, which is the ultimate parent of LIBERTY Dental Plan Corporation (“Liberty Dental”).

On August 6, 2024, we made an equity investment of $2,580, consisting of cash and the net put option discussed in Note 6 “Derivative Financial Instruments”, in Mosaic Health. Mosaic Health is a joint venture with Clayton, Dubilier & Rice (“CD&R”) that is designed to accelerate innovation in care delivery across multiple regions in the United States by bringing together certain care delivery and enablement assets of Carelon Management Services, LLC (“CMSI Assets”), a Carelon Health business, and two CD&R portfolio businesses, apree health and Millennium Physician Group. The investment is accounted for as an equity method investment. Our additional contribution of the CMSI Assets to Mosaic Health was completed on January 1, 2025, for which we received an additional $300 of equity (approximately 5% ownership) in Mosaic Health. The CMSI Assets are included under the captions “Assets held for sale” and “Liabilities held for sale” in our consolidated balance sheets as of December 31, 2024.

In connection with our equity method investment in Mosaic Health, we entered into a financing agreement to provide a term loan of $200 and a line of credit up to $500 to Mosaic Health. Mosaic Health borrowed $100 on the line of credit in December 2025. Net amounts receivable under these arrangements were $282 and $188 at December 31, 2025 and 2024, respectively, which are included under the caption “Other invested assets” in our consolidated balance sheets as of December 31, 2025 and 2024. During the years ended December 31, 2025 and 2024, we recognized $18 and $7, respectively, in interest income from the financing arrangement with Mosaic Health. In addition to the term loan and line of credit, we committed to providing $70 of funding for no additional equity interest in Mosaic Health to meet any shortfall in operating cash flow and regulatory capital requirements of the CMSI Assets through December 31, 2026, and to fund any remaining shortfalls as necessary for which we would receive additional equity interests in Mosaic Health. No additional funding was provided as of December 31, 2025 or 2024. During the year ended December 31, 2025, related party transactions with Mosaic Health included care delivery and enablement services to Elevance Health subsidiaries amounting to $732, reported in benefit expense. Care delivery and enablement services provided by Mosaic Health in 2024 were not material.

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Notes to Consolidated Financial Statements (continued)

In January 2023, we made an equity investment in Liberty Dental, a joint venture with Welsh, Carson, Anderson & Stowe which engages in dental insurance and dental health care administration. The investment is accounted for as an equity method investment. In connection with our equity method investment in Liberty Dental, in December 2024 we entered into a commitment to provide funding in the form of mandatorily redeemable preferred equity shares in Liberty Dental of up to $250, of which $165 and $87 was disbursed as of December 31, 2025 and 2024, respectively. Mandatorily redeemable preferred equity in Liberty Dental of $137 and $87 is included in the caption “Other invested assets” in our consolidated balance sheets at December 31, 2025 and 2024, respectively. Dividend income recognized from the financing arrangement during the year ended December 31, 2025 and 2024 was not material. During the years ended December 31, 2025 and 2024, related party transactions with Liberty Dental included administrative services to our Medicare Advantage members under a capitated arrangement amounting to $583 and $519, respectively, which is included in the caption “Benefit expense” in our consolidated income statements.

Investment Income

The major categories of net investment income for the years ended December 31, 2025, 2024 and 2023 are as follows:

			2025						2024						2023
Fixed maturity securities			$	1,437					$	1,539					$	1,387
Equity securities			42						40						18
Cash equivalents			270						235						305
Other invested assets			482						274						157
Investment income			2,231						2,088						1,867
Investment expenses			(37)						(37)						(42)
Net investment income			$	2,194					$	2,051					$	1,825

Investment Gains (Losses)

Net investment gains (losses) for the years ended December 31, 2025, 2024 and 2023 are as follows:

			2025						2024						2023
Net gains (losses):
Fixed maturity securities:
Gross realized gains from sales			$	123					$	158					$	47
Gross realized losses from sales			(236)						(479)						(488)
Impairment losses recognized in income			(21)						(17)						(15)
Net realized gains (losses) on fixed maturity securities			(134)						(338)						(456)
Equity securities:
Unrealized gains (losses) recognized on equity securities still held			(7)						(6)						(1)
Net realized gains (losses) recognized on equity securities sold			(8)						(9)						6
Net realized gains (losses) on equity securities			(15)						(15)						5
Other investments:
Gross gains			43						49						103
Gross losses			(110)						(25)						(63)
Impairment losses recognized in income			(435)						(126)						(291)
Net gains (losses) on other investments			(502)						(102)						(251)
Net gains (losses) on investments			$	(651)					$	(455)					$	(702)

A primary objective in the management of our fixed maturity and equity portfolios is to maximize total return relative to underlying liabilities and respective liquidity needs. In achieving this goal, assets may be sold to take advantage of market conditions or other investment opportunities as well as tax considerations. Sales will generally produce realized gains and

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Notes to Consolidated Financial Statements (continued)

losses. In the ordinary course of business, we may sell securities at a loss for a number of reasons, including, but not limited to: (i) changes in the investment environment; (ii) expectations that the fair value could deteriorate further; (iii) desire to reduce exposure to an issuer or an industry; (iv) changes in credit quality; or (v) changes in expected cash flow.

Total proceeds from sales, maturities, calls or redemptions of fixed maturity securities were $11,609, $16,334 and $12,289 for the years ended December 31, 2025, 2024 and 2023, respectively.

A significant judgment in the valuation of investments is the determination of when a credit loss has occurred. We follow a consistent and systematic process for recognizing impairments on securities that sustain credit declines in value. We have established a committee responsible for the impairment review process. The decision to impair a security incorporates both quantitative criteria and qualitative information. The impairment review process considers a number of factors including, but not limited to: (i) the extent to which the fair value is less than book value, (ii) the financial condition and near term prospects of the issuer, (iii) our intent and ability to retain impaired investments for a period of time sufficient to allow for any anticipated recovery in fair value, (iv) our intent to sell or the likelihood that we will need to sell a fixed maturity security before recovery of its amortized cost basis, (v) whether the debtor is current on interest and principal payments, (vi) the reasons for the decline in value (i.e., credit event compared to liquidity, general credit spread widening, currency exchange rate or interest rate factors) and (vii) general market conditions and industry or sector specific factors. When a decision has been made to sell an impaired security or it is more likely than not that the impaired security will be required to be disposed of prior to recovery of its cost basis, the security is written down to fair value at the reporting date. For all other impaired securities, if the impairment is deemed to be credit related, an allowance is created.

Investment securities are exposed to various risks, such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities and the level of uncertainty related to changes in the value of investment securities, it is possible that changes in these risk factors in the near term could have a material adverse impact on our results of operations or shareholders’ equity.

At December 31, 2025 and 2024, there were no individual investments that exceeded 10% of shareholders’ equity.

At December 31, 2025 and 2024, there were ten and nine, respectively, fixed maturity investments that did not produce income during the years then ended.

We had unfunded loan commitments to certain equity investees of $1,542 and $1,442 at December 31, 2025 and 2024, respectively. We do not believe such obligations will materially affect our financial position, results of operations, or cash flows.

As of December 31, 2025 and 2024, we had committed approximately $321 and $423, respectively, to future investments in rated notes.

At December 31, 2025 and 2024, securities with carrying values of approximately $1,121 and $1,035, respectively, were deposited by our insurance subsidiaries under requirements of regulatory authorities.

Accrued Investment Income

Accrued investment income totaled $295 and $287 at December 31, 2025 and 2024, respectively. We recognize accrued investment income under the caption “Other receivables” on our consolidated balance sheets.

Securities Lending Programs

The fair value of the cash and securities received as collateral for securities loaned at December 31, 2025 and 2024 was $2,691 and $2,305, respectively. The collateral received was 102% of the market value of the loaned securities at each of December 31, 2025 and 2024.

We recognize the collateral as an asset under the caption “Other current assets” in our consolidated balance sheets, and we recognize a corresponding liability for the obligation to return the collateral to the borrower under the caption “Other current liabilities.” The securities on loan are reported in the applicable investment category on our consolidated balance sheets.

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Notes to Consolidated Financial Statements (continued)

At December 31, 2025 and 2024, the remaining contractual maturities of our securities lending transactions included overnight and continuous transactions of cash for $2,136 and $2,115, respectively, United States Government securities for $552 and $176, respectively, and residential mortgage-backed securities for $3 and $14, respectively.

6. Derivative Financial Instruments

We primarily invest in the following types of derivative financial instruments: interest rate swaps, futures, forward contracts, put and call options, collars, swaptions, embedded derivatives and warrants. We also enter into master netting agreements which reduce credit risk by permitting net settlement of transactions. At December 31, 2025 and 2024, we had received collateral of $34 and posted collateral of $142, respectively, related to our derivative financial instruments.

A summary of the aggregate contractual or notional amounts and carrying values related to derivative financial instruments at December 31, 2025 and 2024 is as follows:

			Contractual/ Notional Amount						Balance Sheet Location						Carrying Value
			Asset						(Liability)
December 31, 2025
Hedging instruments
Interest rate swaps - fixed to floating			$	6,875					Other assets/other liabilities						$	83					$	(44)
Foreign currency forwards			251						Other current liabilities						—						(5)
Subtotal hedging			7,126												83						(49)
Non-hedging instruments
Futures/Forwards			35						Equity securities/other assets						—						—
Subtotal non-hedging			35						Subtotal non-hedging						—						—
Total derivatives			$	7,161					Total derivatives						83						(49)
									Amounts netted						(21)						21
									Net derivatives						$	62					$	(28)
December 31, 2024
Hedging instruments
Interest rate swaps - fixed to floating			$	6,475					Other assets/other liabilities						$	8					$	(150)
Foreign currency forwards			322						Other current liabilities						—						(6)
Subtotal hedging			6,797						Subtotal hedging						8						(156)
Non-hedging instruments
Interest rate swaps			5						Other assets/other liabilities						—						—
Futures/Forwards			124						Equity securities/other assets						3						—
Subtotal non-hedging			129						Subtotal non-hedging						3						—
Total derivatives			$	6,926					Total derivatives						11						(156)
									Amounts netted						(6)						6
									Net derivatives						$	5					$	(150)

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

Fair Value Hedges

We have entered into various interest rate swap contracts to convert a portion of our interest rate exposure on our long-term debt from fixed rates to floating rates. The floating rates payable on all of our fair value hedges are benchmarked to the Secured Overnight Financing Rate (“SOFR”). A summary of our outstanding fair value hedges at December 31, 2025 and 2024 is as follows:

Type of Fair Value Hedges						Year Entered Into						Outstanding Notional Amount												Interest Rate Received									Expiration Date
			2025						2024
Interest rate swap						2025						$	150					$	—					4.600			%						March 15, 2032
Interest rate swap						2025						250						—						5.000									July 15, 2035
Interest rate swap						2024						200						200						5.500									April 15, 2032
Interest rate swap						2024						1,000						1,000						4.750									August 15, 2032
Interest rate swap						2024						600						600						5.150									December 15, 2028
Interest rate swap						2024						1,000						1,000						5.380									December 15, 2033
Interest rate swap						2024						750						750						4.750									August 15, 2029
Interest rate swap						2024						750						750						4.950									May 1, 2031
Interest rate swap						2024						1,200						1,200						5.200									August 15, 2034
Interest rate swap						2023						300						300						5.500									April 15, 2032
Interest rate swap						2023						150						150						2.550									September 15, 2030
Interest rate swap						2023						125						125						4.100									September 1, 2027
Interest rate swap						2023						100						100						2.250									November 15, 2029
Interest rate swap						2022						150						150						5.500									April 15, 2032
Interest rate swap						2022						75						75						4.100									September 1, 2027
Interest rate swap						2022						75						75						2.250									November 15, 2029
Total notional amount outstanding												$	6,875					$	6,475

The following amounts were recorded on our consolidated balance sheets related to cumulative basis adjustments for fair value hedges at December 31, 2025 and 2024:

Balance Sheet Classification in Which Hedged Item is Included						Carrying Amount of Hedged Liability												Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liability
			2025						2024						2025						2024
Long-term debt						$	30,797					$	29,218					$	39					$	(142)

Cash Flow Hedges

We have entered into a series of forward starting pay fixed interest rate swaps with the objective of eliminating the variability of cash flows in the interest payments on future financings that were anticipated at the time of entering into the swaps. During 2025 and 2024, swaps in the notional amount of $150 and $900, respectively, were terminated.

The unrecognized loss, net of tax, for all expired and terminated interest rate cash flow hedges included in accumulated other comprehensive loss was $192 and $201 at December 31, 2025 and 2024, respectively. As of December 31, 2025, the total amount of amortization over the next twelve months for all interest rate cash flow hedges is estimated to increase interest expense by approximately $13. No amounts were excluded from effectiveness testing, and our cash flow hedges were determined to be highly effective during the year ended December 31, 2025.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

Non-Hedging Derivatives

A summary of the effect of non-hedging derivatives on our consolidated statements of income for the years ended December 31, 2025, 2024 and 2023 is as follows:

Type of Non-hedging Derivatives						Income Statement Location of Gain (Loss) Recognized						Derivative (Loss) Gain Recognized
Year ended December 31, 2025
Interest rate swaps						Net losses on financial instruments						(1)
Futures						Net losses on financial instruments						(1)
Total												$	(2)
Year ended December 31, 2024
Options (including swaptions)						Net losses on financial instruments						$	(1)
Collars						Net losses on financial instruments						14
Futures						Net losses on financial instruments						(3)
Total												$	10
Year ended December 31, 2023
Derivatives embedded in convertible securities						Net losses on financial instruments						$	(2)
Options (including swaptions)						Net losses on financial instruments						3
Collars						Net losses on financial instruments						(3)
Futures												10
Total												$	8

In connection with our equity investment in Mosaic Health (see Note 5, “Investments”), we entered into a limited partnership and related agreements with the majority owners that provide for certain rights and obligations of each party, including certain put, call, and purchase price true-up options. These options, if exercised, will result in our purchase of the units held by the majority owners as early as 2028 but no later than 2030 at a price based on certain multiples of revenue and earnings of Mosaic Health businesses, subject to various adjustments and qualifications. We have calculated the fair value of the net put option, which is a Level III measurement (see Note 7, “Fair Value”), using a Monte Carlo simulation, which relies on assumptions including cash flow projections, risk-free rates, volatility and details specific to the options. Significant changes in assumptions could result in significantly lower or higher fair value measurements. The carrying value of the net put option of $1,330, which is a non-cash item measured at fair value at the date of our initial investment, is included under the caption “Other noncurrent liabilities” in our consolidated balance sheets as of December 31, 2025 and 2024. We have elected to not mark the net put option to market, as it is an option on large blocks of equity securities, and the carrying value of the net put option will remain on the consolidated balance sheets until it is exercised, expires, or the terms are substantially amended.

In connection with our equity investment in Liberty Dental (see Note 5, “Investments”), we entered into an agreement with the majority owners that provides for certain rights and obligations of each party, including certain put and call options. These options, if exercised, will result in our purchase of the units held by the majority owners as early as July 1, 2026 but no later than 2027 at a price based on certain multiples of earnings of Liberty Dental, subject to various adjustments and qualifications. We calculated the fair value of the net put option, which is a Level III measurement (see Note 7, “Fair Value”), based on assumptions including cash flow projections, risk-free rates, volatility and details specific to the options. Significant changes in assumptions could result in significantly lower or higher fair value measurements. On March 28, 2025, the terms of the put and call options were substantially amended. The previous net put option liability of $85 at December 31, 2024 was extinguished and we recognized a new net put option liability at its estimated fair value on March 28, 2025 of $396, which is included under the caption “Other noncurrent liabilities” in our consolidated balance sheet as of December 31, 2025. We have elected to not mark the net put option to market, as it is an option on large blocks of equity securities, and the carrying value of the net put option will remain on the consolidated balance sheets until it is exercised, expires, or the terms are substantially amended.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

7. Fair Value

Assets and liabilities recorded at fair value in the consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Level inputs, as defined by FASB guidance for fair value measurements and disclosures, are as follows:

Level Input:						Input Definition:
Level I						Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date.
Level II						Inputs other than quoted prices included in Level I that are observable for the asset or liability through corroboration with market data at the measurement date.
Level III						Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date.

The following methods, assumptions and inputs were used to determine the fair value of each class of the following assets and liabilities recorded at fair value in the consolidated balance sheets:

Cash equivalents: Cash equivalents primarily consist of highly rated money market funds with maturities of three months or less and are purchased daily at par value with specified yield rates. Due to the short-term nature of the funds, we designate all cash equivalents as Level I.

Fixed maturity securities, available-for-sale: Fair values of available-for-sale fixed maturity securities are based on quoted market prices, where available. These fair values are obtained primarily from third-party pricing services, which generally use Level I or Level II inputs for the determination of fair value to facilitate fair value measurements and disclosures. Level II securities primarily include corporate securities, securities from states, municipalities and political subdivisions, mortgage-backed securities, United States Government securities, foreign government securities, and certain other asset-backed securities. For securities not actively traded, the pricing services may use quoted market prices of comparable instruments or discounted cash flow analyses, incorporating inputs that are currently observable in the markets for similar securities. We have controls in place to review the pricing services’ qualifications and procedures used to determine fair values. In addition, we periodically review the pricing services’ pricing methodologies, data sources and pricing inputs to ensure the fair values obtained are reasonable. Inputs that are often used in the valuation methodologies include, but are not limited to, broker quotes, benchmark yields, credit spreads, default rates and prepayment speeds. We also have certain fixed maturity securities, primarily collateralized loan obligation securities, rated note securities and corporate debt securities, that are designated Level III securities. For these securities, the valuation methodologies may incorporate broker quotes, net asset value of underlying loans or discounted cash flow analyses using assumptions for inputs such as expected cash flows, benchmark yields, credit spreads, default rates and prepayment speeds that are not observable in the markets.

Equity securities: Fair values of equity securities are generally designated as Level I and are based on quoted market prices. For certain equity securities, quoted market prices for the identical security are not always available, and the fair value is estimated by reference to similar securities for which quoted prices are available. These securities are designated Level II. We also have certain equity securities, including private equity securities, for which the fair value is estimated based on each security’s current condition and future cash flow projections. Such securities are designated Level III. The fair values of these private equity securities are generally based on either broker quotes or discounted cash flow projections using assumptions for inputs such as the weighted-average cost of capital, long-term revenue growth rates and earnings before interest, taxes, depreciation and amortization, and/or revenue multiples that are not observable in the markets.

Securities lending collateral: Fair values of securities lending collateral are based on quoted market prices, where available. These fair values are obtained primarily from third-party pricing services, which generally use Level I or Level II inputs for the determination of fair value, to facilitate fair value measurements and disclosures.

Derivatives: Fair values are generally based on the quoted market prices by the financial institution that is the counterparty to the derivative transaction. We independently verify prices provided by the counterparties using valuation models that incorporate market observable inputs for similar derivative transactions. These derivatives are designated as Level II securities. Fair values of certain derivatives where market observable inputs are not available are estimated using

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

assumptions such as cash flow projections, risk-free rates, volatility and details specific to the derivative contract. These derivatives are designated as Level III securities.

In addition, the following methods and assumptions were used to determine the fair value of each class of the qualified pension plan assets not defined above (see Note 11, “Retirement Benefits,” for fair values of qualified pension plan assets):

Mutual funds: Fair values are based on quoted market prices, which represent the net asset value (“NAV”) of shares held.

Partnership investments: Fair values are estimated based on the plan’s proportionate ownership of the partnerships’ net assets as reported in their periodic capital statements and is measured using NAV as a practical expedient. The partnerships primarily include a real estate investment fund that invests in real estate entities and provides for quarterly redemptions with 45 days' notice prior to quarter-end, with no unfunded commitments.

Collective investment trusts (“CITs”): Fair values are based on the NAV of the units held by the plan at year end and are measured using NAV as a practical expedient. The CITs are passive index funds that seek investment results that generally correspond to the performance of the Bloomberg U.S. Intermediate Treasury Index. Redemptions are permitted daily with two days' notice.

Commingled fund: Fair value is based on NAV per fund share and is measured using NAV as a practical expedient. The fund primarily invests in publicly traded equity securities of issuers within the fund’s benchmark. The objective of the fund is to produce returns in excess of the relevant benchmark over rolling five-year periods. Redemptions are permitted on the first and fifteenth of the month with seven business days' notice.

Insurance company contracts: Fair value is based on the fair value of the underlying investments of the group annuity investment account as determined by the insurance company. Investments primarily consist of intermediate-term fixed income investments, commercial and residential mortgages, asset-backed securities, and U.S. government and agency-backed securities.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

A summary of fair value measurements by level for assets and liabilities measured at fair value on a recurring basis at December 31, 2025 and 2024 is as follows:

			Level I						Level II						Level III						Total
December 31, 2025
Assets:
Cash equivalents			$	5,184					$	—					$	—					$	5,184
Fixed maturity securities, available-for-sale:
United States Government securities			—						1,503						—						1,503
Government sponsored securities			—						81						—						81
Foreign government securities			—						13						—						13
States, municipalities and political subdivisions, tax-exempt			—						3,701						—						3,701
Corporate securities			—						13,373						410						13,783
Residential mortgage-backed securities			—						3,090						17						3,107
Commercial mortgage-backed securities			—						2,073						—						2,073
Other asset-backed securities			—						1,878						866						2,744
Total fixed maturity securities, available-for-sale			—						25,712						1,293						27,005
Equity securities:
Exchange traded funds			650						—						—						650
Common equity securities			—						35						—						35
Private equity securities			—						—						55						55
Total equity securities			650						35						55						740
Other invested assets - common equity securities			6						—						—						6
Securities lending collateral			—						2,692						—						2,692
Derivatives - other assets			—						62						—						62
Total assets			$	5,840					$	28,501					$	1,348					$	35,689
Liabilities:
Derivatives - other liabilities			$	—					$	(28)					$	—					$	(28)
Total liabilities			$	—					$	(28)					$	—					$	(28)
December 31, 2024
Assets:
Cash equivalents			$	3,199					$	—					$	—					$	3,199
Fixed maturity securities, available-for-sale:
United States Government securities			—						1,824						—						1,824
Government sponsored securities			—						151						—						151
Foreign government securities			—						17						—						17
States, municipalities and political subdivisions, tax-exempt			—						3,052						—						3,052
Corporate securities			—						13,873						43						13,916
Residential mortgage-backed securities			—						3,041						10						3,051
Commercial mortgage-backed securities			—						1,748						—						1,748
Other asset-backed securities			—						1,730						747						2,477
Total fixed maturity securities, available-for-sale			—						25,436						800						26,236
Equity securities:
Exchange traded funds			1,002						—						—						1,002
Common equity securities			87						31						—						118
Private equity securities			—						—						72						72
Total equity securities			1,089						31						72						1,192
Other invested assets - common equity securities			18						—						—						18
Securities lending collateral			—						2,306						—						2,306
Derivatives - other assets			—						5						—						5
Total assets			$	4,306					$	27,778					$	872					$	32,956
Liabilities:
Derivatives - other liabilities			$	—					$	(150)					$	—					$	(150)
Total liabilities			$	—					$	(150)					$	—					$	(150)

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

A reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using Level III inputs for the years ended December 31, 2025, 2024 and 2023 is as follows:

			Corporate Securities						Residential Mortgage- backed Securities												Other Asset-Backed Securities						Equity Securities						Total
Year ended December 31, 2025
Beginning balance at January 1, 2025			$	43					$	10											$	747					$	72					$	872
Total gains (losses):
Recognized in net income			3						—												—						(9)						(6)
Recognized in accumulated other comprehensive income			12						—												17						—						29
Purchases			384						13												162						54						613
Sales			—						—												(8)						(62)						(70)
Settlements			(7)						—												(53)						—						(60)
Transfers into Level III			1						4												1						—						6
Transfers out of Level III			(26)						(10)												—						—						(36)
Ending balance at December 31, 2025			$	410					$	17											$	866					$	55					$	1,348
Change in unrealized gains or losses included in net income related to assets still held at December 31, 2025			$	—					$	—											$	—					$	(10)					$	(10)
Year ended December 31, 2024
Beginning balance at January 1, 2024			$	46					$	2											$	539					$	78					$	665
Total gains (losses):
Recognized in net income			1						—												—						(6)						(5)
Recognized in accumulated other comprehensive income			—						—												12						—						12
Purchases			26						10												118						17						171
Sales			(5)						(2)												(10)						(17)						(34)
Settlements			(4)						—												(1)						—						(5)
Transfers into Level III			—						—												92						—						92
Transfers out of Level III			(21)						—												(3)						—						(24)
Ending balance at December 31, 2024			$	43					$	10											$	747					$	72					$	872
Change in unrealized gains or losses included in net income related to assets still held at December 31, 2024			$	—					$	—											$	—					$	(5)					$	(5)
Year ended December 31, 2023
Beginning balance at January 1, 2023			$	137					$	—											$	356					$	88					$	581
Total gains (losses):
Recognized in net income			(10)						—												—						(4)						(14)
Recognized in accumulated other comprehensive income			6						—												3						—						9
Purchases			38						—												191						15						244
Sales			(88)						—												(17)						(21)						(126)
Settlements			(21)						—												—						—						(21)
Transfers into Level III			6						2												6						—						14
Transfers out of Level III			(22)						—												—						—						(22)
Ending balance at December 31, 2023			$	46					$	2											$	539					$	78					$	665
Change in unrealized gains or losses included in net income related to assets still held at December 31, 2023			$	—					$	—											$	—					$	(6)					$	(6)

There were no individually material transfers into or out of Level III during the years ended December 31, 2025, 2024 or 2023. There were no adjustments to quoted market prices obtained from the pricing services during the years ended December 31, 2025, 2024 or 2023.

Certain assets and liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments only in certain circumstances. We completed our

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

acquisitions of Centers, CareBridge and Paragon in 2024. The net assets acquired in these acquisitions and resulting goodwill and other intangible assets were initially recorded at fair value primarily using Level III inputs. The majority of assets acquired and liabilities assumed were recorded at their carrying values as of the respective date of acquisition, as their carrying values approximated their fair values due to their short-term nature. The fair values of goodwill and other intangible assets acquired in our acquisitions of Centers, CareBridge and Paragon were finalized as of December 31, 2025 based on a valuation performed using the income approach. The income approach estimates fair value based on the present value of the cash flows that the assets could be expected to generate in the future. We developed internal estimates for the expected cash flows and discount rate in the present value calculation.

Also, as discussed further in Note 5 “Investments”, we entered into agreements which included certain put and call options associated with our minority interest ownership of Mosaic Health in 2024 and Liberty Dental in 2023 (as amended in 2025). The resulting net put option liabilities were recorded at their fair values measured at the dates of acquisition using Level III inputs with an election not to mark the derivative to market, which is further discussed and disclosed in Note 6, “Derivatives”. The net put option fair value for Mosaic Health was $2,717 and $1,330 at December 31, 2025 and 2024, respectively. The net put option fair value for Liberty Dental was $327 and $543 at December 31, 2025 and 2024, respectively.

Other than the assets acquired and liabilities assumed in connection with our acquisitions of Centers, CareBridge and Paragon, and the net put options on Mosaic Health and Liberty Dental described above, there were no material assets or liabilities measured at fair value on a nonrecurring basis during the years ended December 31, 2025 or 2024.

Our valuation policy is determined by members of our treasury and accounting departments. Whenever possible, our policy is to obtain quoted market prices in active markets to estimate fair values for recognition and disclosure purposes. Where quoted market prices in active markets are not available, fair values are estimated using discounted cash flow analyses, broker quotes, unobservable inputs or other valuation techniques. These techniques are significantly affected by our assumptions, including discount rates and estimates of future cash flows. The use of assumptions for unobservable inputs for the determination of fair value involves a level of judgment and uncertainty. Changes in assumptions that reasonably could have been different at the reporting date may result in a higher or lower determination of fair value. Changes in fair value measurements, if significant, may affect performance of cash flows.

Potential taxes and other transaction costs are not considered in estimating fair values. Our valuation policy is generally to obtain quoted prices for each security from third-party pricing services, which are derived through recently reported trades for identical or similar securities, making adjustments through the reporting date based upon available market observable information. As we are responsible for the determination of fair value, we perform analysis on the prices received from the pricing services to determine whether the prices are reasonable estimates of fair value. This analysis is performed by our internal treasury personnel who are familiar with our investment portfolios, the pricing services engaged and the valuation techniques and inputs used. Our analysis includes procedures such as a review of month-to-month price fluctuations and price comparisons to secondary pricing services.

In addition to the preceding disclosures on assets recorded at fair value in the consolidated balance sheets, FASB guidance also requires the disclosure of fair values for certain other financial instruments for which it is practicable to estimate fair value, whether or not such values are recognized in the consolidated balance sheets.

Non-financial instruments such as property and equipment, other current assets, deferred income taxes, intangible assets and certain financial instruments, such as limited partnerships, joint ventures, other non-controlled corporations, corporate-owned life insurance policies, and policy liabilities, are excluded from the fair value disclosures. Therefore, the fair value amounts cannot be aggregated to determine our underlying economic value.

The carrying amounts reported in the consolidated balance sheets for cash, premium receivables, self-funded receivables, other receivables, unearned income, accounts payable and accrued expenses, and certain other current liabilities approximate fair value because of the short-term nature of these items. These assets and liabilities are not listed in the table below.

The following methods and assumptions were used to estimate the fair value of each class of financial instrument that is recorded at its carrying value on the consolidated balance sheets:

Other invested assets: Other invested assets primarily include our mortgage loans and notes receivables. Mortgage loans

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

are carried at amortized cost net of loss allowance. The fair value of mortgage loans is measured using discounted cash flows benchmarked against the 10-year U.S. Treasury yield plus a market rate spread. The notes receivables are measured at their amortized cost. The fair value of notes receivables is the present value of discounted future cash flows.

Short-term borrowings: The fair value of our short-term borrowings is based on quoted market prices for the same or similar debt, or if no quoted market prices were available, on the current market interest rates estimated to be available to us for debt of similar terms and remaining maturities.

Long-term debt—senior unsecured notes and surplus notes: The fair values of our notes are based on quoted market prices in active markets for the same or similar debt, or, if no quoted market prices are available, on the current market observable rates estimated to be available to us for debt of similar terms and remaining maturities.

Options: The options consist of put, call and purchase price true-up options associated with our equity investment in the Mosaic Health joint venture and the put and call options associated with our equity investment in Liberty Dental. The fair value of the net put option associated with Mosaic Health is based on a Monte Carlo simulation, which relies on assumptions including cash flow projections, risk-free rates, volatility and details specific to the options. The fair value of the net put option associated with Liberty Dental is based on the discounted present value of estimated future option exercise prices.

A summary of the estimated fair values by level of each class of financial instrument that is recorded at its carrying value on our consolidated balance sheets at December 31, 2025 and 2024 is as follows:

			Carrying Value						Estimated Fair Value
			Level I						Level II						Level III						Total
December 31, 2025
Assets:
Other invested assets			$	781					$	—					$	—					$	762					$	762
Liabilities:
Debt:
Short-term borrowings			150						—						150						—						150
Notes			31,896						—						30,207						—						30,207
Options			1,726						—						—						3,044						3,044
December 31, 2024
Assets:
Other invested assets			$	642					$	—					$	—					$	610					$	610
Liabilities:
Debt:
Short-term borrowings			365						—						365						—						365
Notes			30,867						—						28,460						—						28,460
Options			1,415						—						—						1,873						1,873

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

8. Income Taxes

The components of deferred income taxes at December 31, 2025 and 2024 are as follows:

			2025						2024
Deferred income tax assets:
Accrued expenses			$	652					$	826
Bad debt reserves			465						434
Insurance reserves			122						192
Lease liabilities			137						170
Retirement liabilities			107						126
Deferred compensation			42						45
Federal and state carryforwards			617						428
Foreign (including Puerto Rico) carryforwards			236						139
Other			53						51
Subtotal			2,431						2,411
Less: valuation allowance			(311)						(294)
Total deferred income tax assets			2,120						2,117
Deferred income tax liabilities:
U.S. federal and state intangible assets			2,447						2,584
Foreign (including Puerto Rico) intangible assets			125						194
Capitalized software			439						513
Depreciation and amortization			20						38
Investment basis			276						11
Retirement assets			295						330
Lease right-of-use assets			89						114
Prepaid expenses			240						275
Total deferred income tax liabilities			3,931						4,059
Net deferred income tax liabilities			$	1,811					$	1,942

Deferred tax balances are classified by deferred tax assets and deferred tax liabilities by taxing jurisdiction in the financial statements. We recognized $298 and $206 of deferred tax asset under the caption “Other noncurrent assets” at December 31, 2025 and 2024, respectively. We recognized $2,110 and $2,148 of deferred tax liability under the caption “Deferred tax liabilities, net” at December 31, 2025 and 2024, respectively.

As of December 31, 2025, we have established U.S. deferred taxes for undistributed earnings from certain non-U.S. subsidiaries, which are included in the Investment basis component above, consistent with prior years.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

Significant components of income before income tax expense for the years ended December 31, 2025, 2024 and 2023 consist of the following:

			2025						2024						2023
Domestic U.S.			6,322						7,629						7,580
Foreign (including Puerto Rico)			388						275						135
Income before income tax expense			$	6,710					$	7,904					$	7,715

Income before income taxes, as shown above, is based on the location of the entity to which such earnings are attributable. Where an entity’s earnings are subject to taxation, however, may not correlate solely to where an entity is located. Thus, the income tax provision shown below as federal or foreign may not correspond to the earnings shown above.

Significant components of the provision for income taxes for the years ended December 31, 2025, 2024 and 2023 consist of the following:

			2025						2024						2023
Current tax expense:
Federal			$	1,000					$	1,753					$	1,899
Foreign (including Puerto Rico)			199						93						95
State and local			128						448						420
Total current tax expense			1,327						2,294						2,414
Deferred tax expense (benefit):
Federal			(42)						(232)						(413)
Foreign (including Puerto Rico)			(180)						(134)						(167)
State and local			(56)						5						(110)
Total deferred tax expense (benefit)			(278)						(361)						(690)
Total income tax expense			$	1,049					$	1,933					$	1,724

State and local current tax expense is reported gross of federal benefit in the preceding table, and includes amounts related to audit settlements, uncertain tax positions, state tax credits and true up of prior years’ tax. Such items are included on a net of federal tax basis in the state and local income taxes line in the following 2025 rate reconciliation table and in multiple lines in the 2024 and 2023 rate reconciliation table.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

A reconciliation of income tax expense recorded in the consolidated statements of income and amounts computed at the statutory federal income tax rate for the year ended December 31, 2025 is as follows:

			2025
			Amount						Percent
Amount at statutory rate			$	1,409					21.0		%
State and local income taxes, net of federal tax expense/benefit(1)			121						1.8		%
Tax credits:
Energy-related tax credits			(86)						(1.3)		%
Other			(62)						(0.9)		%
Nontaxable or nondeductible items:
Legal entity restructuring			(176)						(2.6)		%
Other			(75)						(1.1)		%
Changes in unrecognized tax benefits			(71)						(1.1)		%
Other, net			(11)						(0.2)		%
Total income tax expense			$	1,049					15.6		%

'(1) State taxes in California, Indiana, Florida, and New York City contributed to the majority of the tax effect in this category.

During the year ended December 31, 2025, we recognized income tax expense of $1,049, or $4.67 per diluted share. The decrease in effective income tax rate for 2025 compared to 2024 was primarily due to a discrete non-operating tax benefit and favorable resolution of uncertain tax positions. The discrete non-operating tax benefit related to an internal restructuring of certain Elevance Health subsidiaries.

A reconciliation of income tax expense recorded in the consolidated statements of income and amounts computed at the statutory federal income tax rate for the years ended December 31, 2024 and 2023 is as follows:

									2024												2023
															Amount						Percent						Amount						Percent
Amount at statutory rate															$	1,660					21.0		%				$	1,620					21.0		%
State and local income taxes, net of federal tax expense/benefit															216						2.7						124						1.6
Tax exempt interest and dividends received deduction															(12)						(0.1)						(15)						(0.2)
Change in valuation allowance															43						0.6						84						1.1
Other, net															26						0.3						(89)						(1.2)
Total income tax expense															$	1,933					24.5		%				$	1,724					22.3		%

During the year ended December 31, 2024, we recognized income tax expense of $1,933, or $8.30 per diluted share. The increase in effective income tax rate for 2024 compared to 2023 was primarily from state and local income taxes due to the impact of geographic changes in the mix of 2024 earnings.

During the year ended December 31, 2023, we recognized income tax expense of $1,724, or $7.26 per diluted share. The decrease in effective income tax rate for 2023 compared to 2022 was primarily from state and local income taxes due to the impact of geographic changes in the mix of 2023 earnings.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

The change in the carrying amount of gross unrecognized tax benefits from uncertain tax positions for the years ended December 31, 2025 and 2024 is as follows:

			2025						2024
Balance at January 1			$	775					$	468
Additions based on:
Tax positions related to current year			83						146
Tax positions related to prior years			6						216
Reductions based on:
Tax positions related to prior years			(255)						(50)
Settlements with taxing authorities			(62)						(5)
Balance at December 31			$	547					$	775

The table above excludes interest and penalties, net of related tax benefits, which are treated as income tax expense (benefit) under our accounting policy. The interest and penalties are included in the amounts described in the following paragraph.

The amount of unrecognized tax benefits that would impact our effective tax rate in future periods, if recognized, was $630 and $804 at December 31, 2025 and 2024, respectively. Also included in the table above, at December 31, 2025, is $2 that would be recognized as an adjustment to additional paid-in capital, which would not affect our effective tax rate.

For the years ended December 31, 2025, 2024 and 2023, we recognized net interest (benefit) expense of ($15), $57 and $24, respectively. We had accrued approximately $147 and $165 for the payment of interest at December 31, 2025 and 2024, respectively. For the years ended December 31, 2025, 2024 and 2023 we recognized net penalty expense (benefit) of ($41), $7 and $17, respectively. We had accrued approximately $41 and $85 for the payment of penalties at December 31, 2025 and 2024, respectively.

We are a member of the IRS Compliance Assurance Process (“CAP”). The objective of CAP is to reduce taxpayer burden and uncertainty while assuring the IRS of the accuracy of tax returns prior to filing, thereby reducing or eliminating the need for post-filing examinations. As of December 31, 2025, the IRS examination of our 2025, 2024, 2023 and 2022 tax years continues to be in process.

In certain states, we pay premium taxes in lieu of state income taxes. Premium taxes are reported in operating expense.

At December 31, 2025, we had federal net operating loss carryforwards of $266, of which $202 will expire beginning 2028 through 2045 and $64 have an indefinite carryforward period. State and local net operating loss carryforwards of $456, of which $447 will expire beginning 2026 through 2044, and $9 have an indefinite carryforward period. Foreign net operating loss carryforward of $188 will expire beginning 2033 through 2035.

Income taxes netted to a receivable of $436 and $138 at December 31, 2025 and 2024, respectively. We recognized the income tax receivable of $587 and $213 by taxing jurisdiction as an asset under the caption “Other current assets” and the income tax payable of $151 and $75 by taxing jurisdiction as a liability under the caption “Other current liabilities” in our consolidated balance sheets as of December 31, 2025 and 2024, respectively.

During 2025, 2024 and 2023, federal income taxes due totaled $1,367, $1,411 and $1,936, respectively. During 2025 and 2024. we utilized transferable federal tax credits of $1,304 and $108, respectively, to satisfy our federal income taxes due. During 2025, state income taxes paid totaled $315.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

9. Property and Equipment

A summary of property and equipment at December 31, 2025 and 2024 is as follows:

			2025						2024
Computer software, purchased and internally developed			$	7,068					$	6,617
Computer equipment, furniture and other equipment			986						940
Leasehold improvements			665						744
Building and improvements			15						27
Land and improvements			1						1
Property and equipment, gross			8,735						8,329
Accumulated depreciation and amortization			(4,056)						(3,677)
Property and equipment, net			$	4,679					$	4,652

Depreciation expense for 2025, 2024 and 2023 was $94, $105 and $107, respectively. Amortization expense on computer software and leasehold improvements for 2025, 2024 and 2023 was $885, $809 and $765, respectively, which includes amortization expense on computer software, both purchased and internally developed, for 2025, 2024 and 2023 of $803, $734 and $685, respectively. Capitalized costs related to the internal development of software of $6,694 and $6,363 at December 31, 2025 and 2024, respectively, are reported with computer software.

Impairment of property and equipment for the years ended December 31, 2025, 2024 and 2023 was $129, $72, and $446, respectively, which is included in Operating expenses and primarily related to pre-tax charges for information technology asset write-offs and asset impairments related to the closure or partial closure of offices.

10. Goodwill and Other Intangible Assets

A summary of the change in the carrying amount of goodwill for our segments (see Note 20, “Segment Information”) for 2025 and 2024 is as follows:

									Health Benefits						CarelonRx						Carelon Services						Total
Balance as of January 1, 2024									$	22,104					$	957					$	2,256					$	25,317
Acquisitions and adjustments									460						958						1,542						2,960
Balance as of December 31, 2024									22,564						1,915						3,798						28,277
Acquisitions and adjustments									(112)						(17)						196						67
Balance as of December 31, 2025									$	22,452					$	1,898					$	3,994					$	28,344
Accumulated impairment as of December 31, 2025									$	—					$	—					$	—					$	—

As required by FASB guidance, we completed annual impairment tests of existing goodwill and other intangible assets with indefinite lives during 2025, 2024 and 2023. We perform these annual impairment tests during the fourth quarter. FASB guidance also requires interim impairment testing to be performed when potential impairment indicators exist. These tests involve the use of estimates related to the estimated fair value of goodwill and intangible assets with indefinite lives and require a significant degree of management judgment and the use of subjective assumptions. Qualitative testing procedures include assessing our financial performance, macroeconomic conditions, industry and market considerations, various asset specific factors and entity specific events. For quantitative testing, the fair values are estimated using the projected income and market valuation approaches, incorporating Level III internal estimates for inputs, including, but not limited to, revenue projections, income projections, cash flows and discount rates.

We did not incur any impairment losses in 2025 or 2023, as the estimated fair values of our reporting units were substantially in excess of their carrying values.

In 2024, we incurred goodwill impairment losses of $106 in our Carelon Services reporting segment specific to the fair valuation of the CMSI assets included in assets and liabilities held for sale, which were contributed to Mosaic Health as of

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

January 1, 2025 as discussed in Note 5, “Investments.” Otherwise, the estimated fair values of our reporting units were substantially in excess of their carrying values.

The components of other intangible assets as of December 31, 2025 and 2024 are as follows:

			2025																		2024
Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount						Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount
Intangible assets with finite lives:
Customer relationships			$	5,522					$	(2,894)					$	2,628					$	7,866					$	(4,233)					$	3,633
Provider and hospital relationships			312						(182)						130						377						(165)						212
Other			395						(110)						285						423						(67)						356
Total			6,229						(3,186)						3,043						8,666						(4,465)						4,201
Intangible assets with indefinite lives:
Blue Cross and Blue Shield and other trademarks			5,991						—						5,991						5,991						—						5,991
State Medicaid licenses			2,166						—						2,166						1,902						—						1,902
Total			8,157						—						8,157						7,893						—						7,893
Other intangible assets			$	14,386					$	(3,186)					$	11,200					$	16,559					$	(4,465)					$	12,094

Intangible assets with finite lives, along with the related accumulated amortization, are removed from the table above at the end of the fiscal year in which they become fully amortized. Fully amortized finite-lived intangibles with a gross carrying amount and accumulated amortization of $1,906 and $27 were retired in 2025 and 2024, respectively. Measurement period adjustments to the gross carrying amount of finite-lived intangible assets during the year ending December 31, 2025 associated with our acquisition of Carebridge were $(690).

As of December 31, 2025, the estimated amortization expense for each of the five succeeding years is as follows: 2026, $436; 2027, $387; 2028, $337; 2029, $298; and 2030, $263.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

11. Retirement Benefits

We sponsor various qualified defined benefit plans through certain subsidiaries. Future benefit accruals for these plans are frozen, but participants continue to earn interest on existing account balances. We fund our qualified pension plans in amounts that are at least sufficient to meet minimum amounts required by law. Qualified pension plan expenses and valuations are dependent on assumptions used by third-party actuaries in calculating those amounts. These assumptions include discount rates, expected rates of return on plan assets, retirement rates, mortality rates and other factors.

We also sponsor the Elevance Health 401(k) Plan, which is a qualified defined contribution plan covering substantially all employees. Voluntary employee contributions are matched by us subject to certain limitations. Contributions made by us totaled $317, $314 and $316 during 2025, 2024 and 2023, respectively.

The benefit obligations and fair value of plan assets for the qualified pension plans as of December 31, 2025 and 2024 were as follows:

			2025						2024
Benefit obligation			$	(1,195)					$	(1,225)
Fair value of plan assets			1,816						1,764
Over (under) funded status			$	621					$	539

Prepaid pension benefits for the qualified pension plans are reported with “Other noncurrent assets” on the consolidated balance sheets.

As of December 31, 2025, our estimated future payments for the qualified pension plans are as follows: 2026, $129; 2027, $106; 2028, $103; 2029, $99; 2030, $95; and 2031-2035, $439.

The net periodic benefit cost (credit) for the qualified pension plans included in “Operating expense” in the consolidated statements of income was ($17), ($38) and ($46) for the years ending December 31, 2025, 2024 and 2023, respectively. The net pre-tax actuarial losses included in accumulated other comprehensive income (loss) for the qualified pension plans that have not been recognized as net periodic benefit cost were ($509) and ($574) as of December 31, 2025 and 2024, respectively.

The following table represents the significant weighted-average actuarial assumptions for the qualified pension plans:

Net periodic benefit cost			2025						2024						2023
Discount rate			5.47		%				4.91		%				5.18		%
Expected rate of return on plan assets			5.63		%				6.47		%				6.58		%
Interest crediting rate			4.50		%				4.50		%				4.25		%
Benefit obligation			2025						2024						2023
Discount rate			5.24		%				5.47		%				4.91		%
Interest crediting rate			4.50		%				4.50		%				4.50		%

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

The fair values of our qualified pension plan assets by category at December 31, 2025 and 2024 were as follows:

			2025						2024
Cash and cash equivalents			$	32					$	36
Fixed maturity securities			704						620
Equity securities			269						378
Mutual funds			48						44
Insurance company contracts			142						143
Collective investment trusts			484						413
Commingled fund			86						69
Partnerships			51						61
Total fair value of plan assets			$	1,816					$	1,764

As of December 31, 2025 and 2024, there were no significant concentrations of investments in the pension plan assets. No plan assets were invested in Elevance Health common stock. The weighted-average target allocation for pension plan assets is 75% fixed maturity securities, 20% equity securities, and 5% to all other types of investments.

Qualified pension plan assets recorded at fair value are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Equity securities, comprised of U.S. and foreign securities, and mutual funds are classified as Level I. Fixed maturity securities, comprised of corporate bonds, government securities and asset-backed securities, are classified as Level II. Insurance company contracts are classified as Level III. There were no transfers into or out of Level III during the years ended December 31, 2025, 2024 and 2023 nor was the activity for the Level III assets significant for these periods. In accordance with FASB guidance, certain other investments including collective investment trusts, a commingled fund and partnership investments that are measured at fair value using the NAV per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy. See Note 7, “Fair Value,” for additional information regarding the definition of level inputs and the other investments.

12. Medical Claims Payable

A reconciliation of the beginning and ending balances for medical claims payable for the years ended December 31, 2025, 2024 and 2023 is as follows:

			2025						2024						2023
Gross medical claims payable, beginning of year			$	15,580					$	15,865					$	15,348
Ceded medical claims payable, beginning of year			(13)						(7)						(6)
Net medical claims payable, beginning of year			15,567						15,858						15,342
Business combinations and purchase adjustments			344						143						—
Net incurred medical claims:
Current year			145,566						125,370						121,798
Prior years redundancies			(1,290)						(1,731)						(1,571)
Total net incurred medical claims			144,276						123,639						120,227
Net payments attributable to:
Current year medical claims			130,265						110,930						107,146
Prior years medical claims			13,141						13,143						12,565
Total net payments			143,406						124,073						119,711
Net medical claims payable, end of year			16,781						15,567						15,858
Ceded medical claims payable, end of year			48						13						7
Gross medical claims payable, end of year			$	16,829					$	15,580					$	15,865

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

Amounts incurred related to prior years vary from previously estimated liabilities as the claims are ultimately settled. Liabilities at any period-end are continually reviewed and re-estimated as information regarding actual claims payments, or run out, becomes known. This information is compared to the originally established year end liability. Negative amounts reported for incurred medical claims related to prior years result from claims being settled for amounts less than originally estimated. The prior year redundancy of $1,290 shown above for the year ended December 31, 2025, represents an estimate based on paid claim activity from January 1, 2025 to December 31, 2025. Medical claim liabilities are usually described as having a “short tail,” which means that they are generally paid within twelve months of the member receiving service from the provider. Accordingly, the majority of the $1,290 redundancy relates to claims incurred in calendar year 2024.

The following table provides a summary of the two key assumptions having the most significant impact on our incurred but not paid liability estimates for the years ended December 31, 2025, 2024 and 2023, which are the completion and trend factors. These vital assumptions can be affected by variables such as utilization levels, unit costs, mix of business, benefit plan designs, provider reimbursement levels, processing system conversions and changes, claim inventory levels, claim processing and submission patterns, and operational changes resulting from business combinations.

			Favorable Developments by Changes in Key Assumptions
			2025						2024						2023
Assumed trend factors			$	(1,000)					$	(688)					$	(895)
Assumed completion factors			(290)						(1,043)						(676)
Total			$	(1,290)					$	(1,731)					$	(1,571)

The favorable development recognized in 2025 resulted primarily from trend factors in late 2024 developing more favorably than originally expected as well as a smaller but significant contribution from completion factor development.

The favorable development recognized in 2024 resulted primarily from completion factors developing more favorably than originally expected as well as a smaller but significant contribution from trend factors in late 2023.

The favorable development recognized in 2023 resulted primarily from trend factors in late 2022 developing more favorably than originally expected. Favorable development in the completion factors in late 2022 also contributed to the favorable development in 2023.

The reconciliation of net incurred medical claims to benefit expense included in the consolidated statements of income is as follows:

						Years Ended December 31
						2025						2024						2023
Net incurred medical claims with medical claims payable						$	140,560					$	123,639					$	120,227
Performance-based risk arrangements without medical claims payable						3,716						—						—
Total net incurred medical claims						144,276						123,639						120,227
Quality improvement and other claims expense						3,947						3,928						4,103
Benefit expense						$	148,223					$	127,567					$	124,330

Incurred claims development, net of reinsurance, for the years ended December 31, 2025, 2024 and 2023 is as follows:

						Cumulative Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
						2023						2024						2025
Claim Years						(Unaudited)						(Unaudited)
2023 & Prior						$	135,569					$	133,837					$	133,879
2024												125,513						124,181
2025																		145,910
Total																		$	403,970

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

Paid claims development, net of reinsurance, for the years ended December 31, 2025, 2024 and 2023 is as follows:

						Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
						2023						2024						2025
Claim Years						(Unaudited)						(Unaudited)
2023 & Prior						$	119,711					$	132,853					$	133,572
2024												110,930						123,352
2025																		130,265
Total																		$	387,189

At December 31, 2025, the total of incurred but not reported liabilities plus expected development on reported claims was $307, $829 and $15,645 for the claim years 2023 and prior, 2024 and 2025, respectively.

At December 31, 2025, the cumulative number of reported claims was 538, 522 and 474 for the claim years 2023 and prior, 2024 and 2025, respectively.

The information about incurred claims development, paid claims development and cumulative number of reported claims for the years ended December 31, 2023 and 2024 is unaudited and presented as supplementary information.

The cumulative number of reported claims for each claim year has been developed using historical data captured by our claim payment systems. The provided claim amounts are not a precise tool for understanding utilization of medical services. They could be impacted by a variety of factors, including changes in provider billing practices, provider reimbursement arrangements, mix of services, benefit design or processing systems. The cumulative number of reported claims has been provided to comply with FASB accounting standards and is not used by management in its claims analysis. Our cumulative number of reported claims may not be comparable to similar measures reported by other health benefits companies.

The reconciliation of incurred and paid claims development information for the three years ended December 31, 2025, reflected in the tables above, to the consolidated ending balance for medical claims payable included in the consolidated balance sheets, as of December 31, 2025, is as follows:

			Total
Cumulative incurred claims and allocated claim adjustment expenses, net of reinsurance			$	403,970
Less: Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance			387,189
Net medical claims payable, end of year			16,781
Ceded medical claims payable, end of year			48
Insurance lines other than short duration			255
Gross medical claims payable, end of year			$	17,084

13. Debt

Short-term Borrowings

We are a member, through certain subsidiaries, of the Federal Home Loan Bank of Indianapolis, the Federal Home Loan Bank of Cincinnati, the Federal Home Loan Bank of Atlanta and the Federal Home Loan Bank of New York (collectively, the “FHLBs”). As a member we have the ability to obtain short-term cash advances, subject to certain minimum collateral requirements. At December 31, 2025 and 2024, $150 and $365, respectively, were outstanding under our short-term FHLB borrowings. Outstanding short-term FHLB borrowings at December 31, 2025 had fixed interest rates of 3.78%.

We have a senior revolving credit facility (the “5-Year Facility”) with a group of lenders for general corporate purposes. On September 5, 2025, we amended and restated the credit agreement for the 5-Year Facility to, among other things, extend the maturity date of the 5-Year Facility from April 2027 to September 2030 and increase the amount of credit available under the 5-Year Facility from $4,000 to $5,000. Our ability to borrow under the 5-Year Facility is subject to compliance with certain covenants, including covenants requiring us to maintain a defined debt-to-capital ratio of not more than 60%, subject

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

to increase in certain circumstances set forth in the credit agreement for the 5-Year Facility. As of December 31, 2025, our debt-to-capital ratio, as defined and calculated under the 5-Year Facility, was 42.1%. We do not believe the restrictions contained in our 5-Year Facility covenants materially affect our financial or operating flexibility. As of December 31, 2025, we were in compliance with all of our debt covenants under the 5-Year Facility. There were no amounts outstanding under the 5-Year Facility at any time during the years ended December 31, 2025 or 2024.

We have an authorized commercial paper program of up to $5,000, the proceeds of which may be used for general corporate purposes. In October 2025, we increased the amount available under the commercial paper program from $4,000 to $5,000. There were no amounts outstanding under our commercial paper program at December 31, 2025 or 2024.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

Long-term Debt

The carrying value of our long-term debt at December 31, 2025 and 2024 consists of the following:

			2025						2024
Senior unsecured notes:
2.375%, due 2025			—						1,250
5.350%, due 2025			—						399
1.500%, due 2026			750						749
4.500%, due 2026			349						349
4.900%, due 2026			—						499
3.650%, due 2027			1,597						1,596
4.000%, due 2028			747						—
4.101%, due 2028			1,244						1,238
2.875%, due 2029			823						822
5.150%, due 2029			613						601
2.250%, due 2030			1,084						1,075
4.750%, due 2030			751						731
2.550%, due 2031			980						971
4.950%, due 2031			751						726
4.600%, due 2032			742						—
4.100%, due 2032			596						596
5.500%, due 2032			656						635
4.750%, due 2033			1,005						973
5.375%, due 2034			1,020						992
5.950%, due 2034			335						335
5.200%, due 2035			1,188						1,151
5.000%, due 2036			985						—
5.850%, due 2036			397						397
6.375%, due 2037			365						364
5.800%, due 2040			115						115
4.625%, due 2042			861						860
4.650%, due 2043			975						975
4.650%, due 2044			768						768
5.100%, due 2044			548						548
4.375%, due 2047			1,389						1,389
4.550%, due 2048			841						840
3.700%, due 2049			813						813
3.125%, due 2050			989						988
3.600%, due 2051			1,234						1,234
4.550% due 2052			690						689
6.100%, due 2052			742						742
5.125%, due 2053			1,085						1,084
4.850%, due 2054			247						247
5.650%, due 2054			986						985
5.700%, due 2055			1,328						1,327
5.700%, due 2055			492						—
5.850% due 2064			790						789
Surplus note:
9.000%, due 2027			25						25
Total Long-Term Debt			31,896						30,867
Current portion of long-term debt			(1,099)						(1,649)
Long-term debt, less current portion			$	30,797					$	29,218

All debt is a direct obligation of Elevance Health, Inc., except for the surplus note and the FHLB borrowings.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

We generally issue senior unsecured notes (“Notes”) for long-term borrowing purposes. Certain of these Notes may have a call feature that allows us to redeem the Notes at any time at our option and/or a put feature that allows a Note holder to redeem the Notes upon the occurrence of both a change in control event and a downgrade of the Notes below an investment grade rating.

On September 15, 2025, we issued $750 aggregate principal amount of 4.000% Notes due 2028 (the “2028 Notes”), $750 aggregate principal amount of 4.600% Notes due 2032 (the “2032 Notes”), $1,000 aggregate principal amount of 5.000% Notes due 2036 (the “2036 Notes”), and $500 aggregate principal amount of 5.700% Notes due 2055 (the “2055 Notes”, and, together with the 2028 Notes, the 2032 Notes and the 2036 Notes, the “Notes”) under our shelf registration statement. Interest on the 2028 Notes, the 2032 Notes, and the 2055 Notes are payable semi-annually in arrears on March 15 and September 15 of each year, commencing March 15, 2026. Interest on the 2036 Notes is payable semi-annually in arrears on January 15 and July 15 of each year, commencing January 15, 2026. We used the net proceeds from the issuance of the Notes to redeem all of the $400 aggregate principal amount of our 5.350% senior notes due 2025 and the $500 aggregate principal amount of our 4.900% senior notes due 2026. We intend to use the remainder of the net proceeds for working capital and general corporate purposes, including, but not limited to, the funding of acquisitions, repayment of other short-term and long-term debt and the repurchase of our common stock pursuant to our share repurchase program.

On January 15, 2025, we repaid, at maturity, the $1,250 outstanding balance of our 2.375% senior unsecured notes.

On December 1, 2024, we repaid, at maturity, the $850 outstanding balance of our 3.35% senior unsecured notes.

On October 31, 2024, we issued $350 aggregate principal amount of 4.500% Notes due 2026 (the “New 2026 Notes”), $750 aggregate principal amount of 4.750% Notes due 2030 (the “2030 Notes”), $750 aggregate principal amount of 4.950% Notes due 2031 (the “2031 Notes”), $1,200 aggregate principal amount of 5.200% Notes due 2035 (the “2035 Notes”), $1,350 aggregate principal amount of 5.700% Notes due 2055 (the “2055 Notes”) and $800 aggregate principal amount of 5.850% Notes due 2064 (the “2064 Notes”) under our shelf registration statement. Interest on the New 2026 Notes is payable semi-annually in arrears on April 30 and October 30 of each year, commencing April 30, 2025. Interest on the 2030 Notes, 2035 Notes and 2055 Notes are payable semi-annually in arrears on February 15 and August 15 of each year, commencing February 1, 2025. Interest on the 2031 Notes and 2064 Notes are payable semi-annually in arrears on May 1 and November 1 of each year, commencing May 1, 2025. We used the net proceeds for working capital and general corporate purposes, including, but not limited to, the funding of acquisitions, repayment of short-term and long-term debt and the repurchase of our common stock pursuant to our share repurchase program.

On August 15, 2024, we repaid, at maturity, the $799 outstanding balance of our 3.500% senior unsecured notes.

On May 30, 2024, we issued $600 aggregate principal amount of 5.150% Notes due 2029 (the “2029 Notes”), $1,000 aggregate principal amount of 5.375% Notes due 2034 (the “2034 Notes”) and $1,000 aggregate principal amount of 5.650% Notes due 2054 (the “2054 Notes”, and, together with the 2029 Notes and the 2034 Notes, the “Notes”) under our shelf registration statement. Interest on the Notes is payable semi-annually in arrears on June 15 and December 15 of each year, commencing December 15, 2024. We used the net proceeds for working capital and general corporate purposes, including, but not limited to, the funding of acquisitions, repayment of short-term and long-term debt and the repurchase of our common stock pursuant to our share repurchase program.

On February 8, 2023, we issued $500 aggregate principal amount of 4.900% Notes due 2026 (the “2026 Notes”), $1,000 aggregate principal amount of 4.750% Notes due 2033 (the “2033 Notes”) and $1,100 aggregate principal amount of 5.125% Notes due 2053 (the “2053 Notes”) under our shelf registration statement. Interest on the 2026 Notes was payable semi-annually in arrears on February 8 and August 8 of each year, commencing August 8, 2023. Interest on the 2033 Notes and 2053 Notes is payable semi-annually in arrears on February 15 and August 15 of each year, commencing August 15, 2023. We used the net proceeds for working capital and general corporate purposes, including, but not limited to, the funding of acquisitions, repayment of short-term and long-term debt and the repurchase of our common stock pursuant to our share repurchase program.

On January 17, 2023, we repaid, at maturity, the $1,000 outstanding balance of our 3.300% senior unsecured notes. On March 15, 2023, we repaid, at maturity, the $500 outstanding balance of our 0.450% senior unsecured notes.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

Convertible Debentures

On March 15, 2023, we redeemed all of our outstanding senior unsecured convertible debentures due 2042 (the “Debentures”), pursuant to the indenture dated as of October 9, 2012 (the “Indenture”) between us and The Bank of New York Mellon Trust Company, N.A., as trustee. The Debentures were redeemed at a redemption price equal to 100% of the principal amount of the Debentures plus accrued and unpaid interest to, but excluding, the date of redemption for cash totaling $5. During the three months ended March 31, 2023, $59 of aggregate principal amount of the Debentures was surrendered for conversion by certain holders in accordance with the terms and conditions of the Indenture. We elected to settle the excess of the principal amount of the conversions with cash for total payments during the three months ended March 31, 2023 of $404.

Interest paid on our total outstanding debt during 2025, 2024 and 2023 was $1,410, $1,239, and $1,032, respectively.

We were in compliance with all applicable covenants under all of our outstanding debt agreements at December 31, 2025 and 2024.

Future maturities of all long-term debt outstanding at December 31, 2025 are as follows: 2026, $1,100; 2027, $1,625; 2028, $2,000; 2029, $1,425; 2030, $1,850 and thereafter, $24,126.

14. Commitments and Contingencies

Litigation and Regulatory Proceedings

We are defendants in, or parties to, a number of pending or threatened legal actions or proceedings. To the extent a plaintiff or plaintiffs in the following cases have specified in their complaint or in other court filings the amount of damages being sought, we have noted those alleged damages in the descriptions below.

Where available information indicates that it is probable that a loss has been incurred as of the date of the consolidated financial statements and we can reasonably estimate the amount of that loss, we accrue the estimated loss by a charge to income. In many proceedings, however, it is difficult to determine whether any loss is probable or reasonably possible. In addition, even where loss is possible or probable or an exposure to loss exists in excess of the liability already accrued with respect to a previously identified loss contingency, it is not always possible to reasonably estimate the amount of the possible or probable loss or range of losses in excess of the amount, if any, accrued, for various reasons, including but not limited to some or all of the following: (i) there are novel or unsettled legal issues presented, (ii) the proceedings are in early stages, (iii) there is uncertainty as to the likelihood of a class being certified or decertified or the ultimate size and scope of the class, (iv) there is uncertainty as to the outcome of pending appeals or motions, (v) there are significant factual issues to be resolved, and/or (vi) in many cases, the plaintiffs have not specified damages in their complaint or in court filings.

With respect to the cases described below, we contest liability and/or the amount of damages in each matter, and we believe we have meritorious defenses. We do not believe the outcome of any known pending or threatened legal actions or proceedings will, in the aggregate, have a material impact on our financial position. However, unanticipated outcomes do sometimes occur, which could result in liabilities in excess of our accruals and could have a material adverse effect on our consolidated financial position or results of operations.

In addition to the lawsuits described below, we are also involved in other pending and threatened litigation of the character incidental to our business and are from time to time involved as a party in various governmental investigations, audits, reviews and administrative proceedings (“government actions”). These government actions include routine and special inquiries by and disclosures to state insurance departments, state attorneys general, U.S. Regulatory Agencies, the U.S. Attorney General and subcommittees of the U.S. Congress. Such government actions could result in the imposition of civil or criminal fines, penalties, other sanctions and additional rules, regulations or other restrictions on our business operations. Any liability that may result from any one of these government actions individually, or in the aggregate, could have a material adverse effect on our consolidated financial position or results of operations.

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Notes to Consolidated Financial Statements (continued)

Blue Cross Blue Shield Antitrust Litigation

We have been a defendant in multiple lawsuits that were initially filed in 2012 against the BCBSA and Blue Cross and/or Blue Shield licensees (the “Blue plans”) across the country. These cases were consolidated into a single, multi-district proceeding captioned In re Blue Cross Blue Shield Antitrust Litigation that is pending in the U.S. District Court for the Northern District of Alabama (the “Court”). Generally, the suits allege that the BCBSA and the Blue plans have conspired to horizontally allocate geographic markets through license agreements, best efforts rules that limit the percentage of non-Blue revenue of each plan, restrictions on acquisitions, rules governing the BlueCard® and National Accounts programs and other arrangements in violation of the Sherman Antitrust Act and related state laws. The cases were brought by two putative nationwide classes of plaintiffs, health plan subscribers and providers.

The BCBSA and Blue plans approved a settlement agreement and release with the subscriber plaintiffs (the “Subscriber Settlement Agreement”), which received final approval from the Court in September 2022. The ultimate amount paid by the Company under the Subscriber Settlement Agreement was $604, which was primarily accrued in 2020. The Subscriber Settlement Agreement and the defendants' payment and non-monetary obligations under the Subscriber Settlement Agreement became effective in June 2024, with the request for second Blue plan bid provisions effective in September 2024. The funds held in escrow will be distributed to members of the subscriber class in accordance with the Subscriber Settlement Agreement.

A number of follow-on cases involving entities that opted out of the Subscriber Settlement Agreement have been filed and remain pending. Those actions are: Alaska Air Group, Inc., et al. v. Anthem, Inc., et al., No. 2:21-cv-01209-AMM (N.D. Ala.) (“Alaska Air”); JetBlue Airways Corp., et al. v. Anthem, Inc., et al., No. 2:22-cv-00558-GMB (N.D. Ala.) (“Jet Blue”); Metropolitan Transportation Authority v. Blue Cross and Blue Shield of Alabama et al., No. 2:22-cv-00265-RDP (N.D. Ala.) (dismissed without prejudice in June 2023); Bed Bath & Beyond Inc. v. Anthem, Inc., No. 2:22-cv-01256-SGC (N.D. Ala.); Hoover, et al. v. Blue Cross Blue Shield Association, et al., No. 1:21-cv-23448 (S.D. Fla.).; and VHS Liquidating Trust v. Blue Cross of California, et al., No. RG21106600 (Cal. Super.) (“VHS”). In February 2023, the Court denied the defendants’ motion to dismiss based on a statute of limitations defense in Alaska Air and Jet Blue. In September 2023, the California court presiding over the VHS case upheld its prior order granting in part defendants’ motion to strike based on the statute of limitations. On February 14, 2025, the VHS plaintiffs amended their complaint to add an additional plaintiff, Children's Hospital of Los Angeles. We intend to continue to vigorously defend these follow-on cases, which we believe are without merit; however, their ultimate outcome cannot be presently determined.

In the third quarter of 2024, the BCBSA, along with the individually named Blue plans approved a settlement agreement and release (the “Provider Settlement Agreement”) with the provider plaintiffs. The Court granted preliminary approval of the provider settlement on December 4, 2024. A Final Fairness Hearing was held in July 2025, and a Final Order of Approval was issued in August 2025. As a result of the Final Order of Approval, the defendants were required to make a monetary settlement payment and certain non-monetary terms including (i) expansion of certain opportunities to contract with providers in contiguous service areas, (ii) certain prompt pay commitments, and (iii) various technological enhancements to the BlueCard program are now being implemented on a timeline set forth in the Provider Settlement Agreement. The effective date of the Provider Settlement Agreement was September 19, 2025. We recognized our payment obligation under the Provider Settlement Agreement of $666 in September 2024 as operating expense in the Corporate & Other segment (see Note 20, “Segment Information”).

A number of follow-on cases involving entities that opted out of the Provider Settlement Agreement have been filed and have been centralized in the BCBSA Litigation multi-district proceeding. We intend to continue to vigorously defend these provider follow-on cases, which we believe are without merit; however, their ultimate outcome cannot be presently determined.

Medicare Risk Adjustment Litigation

In March 2020, the U.S. Department of Justice (“DOJ”) filed a civil lawsuit against Elevance Health, Inc. in the U.S. District Court for the Southern District of New York (the “District Court”) in a case captioned United States v. Anthem, Inc. The DOJ’s suit alleges, among other things, that we falsely certified the accuracy of the diagnosis data we submitted to the Centers for Medicare & Medicaid Services (“CMS”) for risk-adjustment purposes under Medicare Part C and knowingly failed to delete inaccurate diagnosis codes. The DOJ further alleges that, as a result of these purported acts, we caused CMS

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Notes to Consolidated Financial Statements (continued)

to calculate the risk-adjustment payments based on inaccurate diagnosis information, which enabled us to obtain unspecified amounts of payments in Medicare funds in violation of the False Claims Act. The DOJ filed an amended complaint in July 2020, alleging the same causes of action but revising some of its factual allegations. In September 2020, we filed a motion to transfer the lawsuit to the Southern District of Ohio, a motion to dismiss part of the lawsuit, and a motion to strike certain allegations in the amended complaint, all of which the District Court denied in October 2022. In November 2022, we filed an answer. In March 2023, discovery commenced. Fact and expert discovery are ongoing with current completion deadlines of June 30, 2026 and March 8, 2027, respectively. We intend to continue to vigorously defend this suit, which we believe is without merit; however, the ultimate outcome cannot be presently determined.

Other Contingencies

From time to time, we and certain of our subsidiaries are parties to various legal proceedings, many of which involve claims for coverage encountered in the ordinary course of business. We, like Health Maintenance Organizations (“HMOs”) and health insurers generally, exclude certain healthcare and other services from coverage under our HMO, Preferred Provider Organizations and other plans. We are, in the ordinary course of business, subject to the claims of our enrollees arising out of decisions to restrict or deny reimbursement for uncovered services. The loss of even one such claim, if it results in a significant punitive damage award, could have a material adverse effect on us. In addition, the risk of potential liability under punitive damage theories may increase significantly the difficulty of obtaining reasonable reimbursement of coverage claims.

Contractual Obligations and Commitments

In September 2024, we extended our agreement with a vendor for information technology infrastructure and related management and support services through June 2029. Our remaining commitment under this agreement is approximately $1,634. We have the ability to terminate the agreement upon the occurrence of certain events, subject to early termination fees.

CarelonRx markets and offers pharmacy services to our affiliated health plan customers throughout the country, as well as to customers outside of the health plans we own. The comprehensive pharmacy services portfolio includes all core pharmacy services, such as home delivery and specialty pharmacies, claims adjudication, formulary management, pharmacy networks, rebate administration, a prescription drug database and member services. CarelonRx delegates certain core pharmacy services to CaremarkPCS Health, L.L.C. (“CVS”), which is a subsidiary of CVS Health Corporation, pursuant to an agreement (“CVS Agreement”), with the current contractual term extending through December 31, 2027. We can elect to have CVS continue to provide services to us for a three-year extension period on the same terms and conditions as in the current CVS Agreement in the event of a termination or non-renewal by either party.

We have financial guarantees related to standby letters of credit and surety bonds related to certain contractual commitments, which totaled $819 as of December 31, 2025. We do not believe such obligations will materially affect our financial position, results of operations, or cash flows.

We have unfunded loan commitments to certain equity investees of $401 at December 31, 2025. We do not believe such obligations will materially affect our financial position, results of operations, or cash flows.

Vulnerability Concentrations

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash equivalents, investment securities, premium receivables and instruments held through hedging activities. All investment securities are managed by professional investment managers within policies authorized by our Board of Directors. Such policies limit the amounts that may be invested in any one issuer and prescribe certain investee company criteria. Concentrations of credit risk with respect to premium receivables are limited due to the large number of employer groups that constitute our customer base in the states in which we conduct business. As of December 31, 2025, there were no significant concentrations of financial instruments in a single investee, industry or geographic location.

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Notes to Consolidated Financial Statements (continued)

15. Capital Stock

Stock Incentive Plan****s

Our Board of Directors has adopted the 2017 Elevance Health Incentive Compensation Plan (the “2017 Incentive Plan”) which has been approved by our shareholders. The term of the 2017 Incentive Plan is such that no awards may be granted on or after May 18, 2027. The 2017 Incentive Plan gives authority to the Compensation and Talent Committee of the Board of Directors to make incentive awards to our non-employee directors, employees and consultants, consisting of stock options, stock, restricted stock, restricted stock units, cash-based awards, stock appreciation rights, performance shares and performance units. The 2017 Incentive Plan limits the number of available shares for issuance to 37.5 shares, subject to adjustment as set forth in the 2017 Incentive Plan.

Stock options are granted for a fixed number of shares with an exercise price at least equal to the fair value of the shares at the grant date. Stock options vest over three years in equal annual installments and generally have a term of ten years from the grant date.

Certain option grants contain provisions whereby the employee continues to vest in the award subsequent to termination due to retirement. Our attribution method for newly granted awards considers all vesting and other provisions, including retirement eligibility, in determining the requisite service period over which the fair value of the awards will be recognized.

Awards of restricted stock or restricted stock units are issued at the fair value of the stock on the grant date and may also include one or more performance measures that must be met for the award to vest. For restricted stock or restricted stock units without performance measures, the restrictions lapse in three equal annual installments. Restricted stock or restricted stock units with performance measures vest in three-year installments. Performance units issued in 2025 will vest in 2028, based on certain revenue and earnings targets over the three-year period of 2025 through 2027. Performance units issued in 2024 will vest in 2027, based on certain revenue and earnings targets over the three-year period of 2024 through 2026. Performance units issued in 2023 will vest in 2026, based on certain revenue and earnings targets over the three-year period of 2023 through 2025.

For the years ended December 31, 2025, 2024 and 2023, we recognized share-based compensation expense of $276, $191 and $289, respectively, as well as related tax benefits of $62, $47 and $73, respectively.

A summary of stock option activity for the year ended December 31, 2025 is as follows:

			Number of Shares						Weighted-Average Option Price per Share						Weighted-Average Remaining Contractual Life (Years)						Aggregate Intrinsic Value
Outstanding at January 1, 2025			2.9						$	361.36					5.58						$	166
Granted			0.6						393.99
Exercised			(0.2)						218.66
Forfeited or expired			(0.2)						439.71
Outstanding at December 31, 2025			3.1						373.90						5.65						$	107
Exercisable at December 31, 2025			2.0						343.88						4.33						$	106

The intrinsic value of options exercised during the years ended December 31, 2025, 2024 and 2023 amounted to $38, $123 and $69, respectively. We recognized tax benefits of $8, $21 and $18 during the years ended December 31, 2025, 2024 and 2023, respectively, from option exercises and disqualifying dispositions. During the years ended December 31, 2025, 2024 and 2023, we received cash of $51, $154 and $87, respectively, from exercises of stock options.

The total fair value of restricted stock awards that vested during the years ended December 31, 2025, 2024 and 2023 was $158, $298 and $285, respectively.

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Notes to Consolidated Financial Statements (continued)

A summary of the status of nonvested restricted stock activity, including restricted stock units and performance units, for the year ended December 31, 2025 is as follows:

			Restricted Stock Shares and Units						Weighted-Average Grant Date Fair Value per Share
Nonvested at January 1, 2025			1.0						$	478.70
Granted			0.6						392.54
Vested			(0.4)						466.99
Forfeited			(0.1)						448.58
Nonvested at December 31, 2025			1.1						437.32

During the year ended December 31, 2025, we granted approximately 0.3 restricted stock units that are contingent upon us achieving certain revenue and earnings targets over the three-year period of 2025 through 2027. These grants have been included in the activity shown above, but will be subject to adjustment at the end of 2027, based on results in the three-year period.

As of December 31, 2025, the total remaining unrecognized compensation expense related to nonvested stock options and restricted stock, including restricted stock units and performance units, amounted to $34 and $208, respectively, which will be amortized over the weighted-average remaining requisite service periods of 11 months and 14 months, respectively.

As of December 31, 2025, there were approximately 11.6 shares of common stock available for future grants under the 2017 Incentive Plan.

Fair Value

We use a binomial lattice valuation model to estimate the fair value of all stock options granted. Expected volatility assumptions used in the binomial lattice model are based on an analysis of implied volatility of publicly traded options on our stock and historical volatility of our stock price. The risk-free interest rate is derived from the U.S. Treasury strip rates at the time of the grant. The expected term of the options was derived from the outputs of the binomial lattice model, which incorporates post-vesting forfeiture assumptions based on an analysis of historical data. The dividend yield was based on our estimate of future dividend yields. Similar groups of employees that have dissimilar exercise behavior are considered separately for valuation purposes. We utilize the multiple-grant approach for recognizing compensation expense associated with each separately vesting portion of the share-based award.

The following weighted-average assumptions were used to estimate the fair values of options granted during the years ended December 31, 2025, 2024 and 2023:

			2025						2024						2023
Risk-free interest rate			4.29		%				4.28		%				3.95		%
Volatility factor			30.00		%				28.00		%				29.00		%
Dividend yield (annual)			1.71		%				1.31		%				1.30		%
Weighted-average expected life (years)			4.45						4.40						4.40

The following weighted-average fair values per share were determined for the years ended December 31, 2025, 2024 and 2023:

			2025						2024						2023
Options granted during the year			$	106.84					$	134.61					$	126.90
Restricted stock awards granted during the year			392.54						501.78						467.79

The binomial lattice option-pricing model requires the input of subjective assumptions including the expected stock price volatility. Because our stock option grants have characteristics significantly different from those of traded options, and

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Notes to Consolidated Financial Statements (continued)

because changes in the subjective input assumptions can materially affect the fair value estimate, in our opinion, existing models do not necessarily provide a reliable single measure of the fair value of our stock option grants.

Employee Stock Purchase Plan

We have registered 14.0 shares of common stock for the Employee Stock Purchase Plan (the “Stock Purchase Plan”), which is intended to provide a means to encourage and assist employees in acquiring a stock ownership interest in Elevance Health. Pursuant to the terms of the Stock Purchase Plan, an eligible employee is permitted to purchase no more than $25,000 (actual dollars) worth of stock in any calendar year, based on the fair value of the stock at the end of each plan quarter. Employees become participants by electing payroll deductions from 1% to 15% of gross compensation. Once purchased, the stock is accumulated in the employee’s investment account. The Stock Purchase Plan allows participants to purchase shares of our common stock at a discounted price per share of 90% of the fair value of a share of common stock on the lower of the first or last trading day of the plan quarter purchase period. The Stock Purchase Plan discount recognized as compensation expense for the years ended December 31, 2025, 2024, and 2023 was $11, $10 and $8, respectively, based on GAAP guidance. During the years ended December 31, 2025, 2024 and 2023, we issued 0.2, 0.2 and 0.1 shares, respectively, under the Stock Purchase Plan, and we received cash of $57, $65 and $65, respectively, for such shares. As of December 31, 2025, 3.8 shares were available for issuance under the Stock Purchase Plan.

Use of Capital and Stock Repurchase Program

We regularly review the appropriate use of capital, including acquisitions, common stock and debt security repurchases and dividends to shareholders. The declaration and payment of any dividends or repurchases of our common stock or debt is at the discretion of our Board of Directors and depends upon our financial condition, results of operations, future liquidity needs, regulatory and capital requirements and other factors deemed relevant by our Board of Directors.

A summary of the cash dividend activity for the years ended December 31, 2025 and 2024 is as follows:

Declaration Date						Record Date						Payment Date						Cash Dividend per Share						Total
Year ended December 31, 2025
January 22, 2025						March 10, 2025						March 25, 2025						$	1.71					$	386
April 16, 2025						June 10, 2025						June 25, 2025						1.71						385
July 16, 2025						September 10, 2025						September 25, 2025						1.71						381
October 15, 2025						December 5, 2025						December 19, 2025						1.71						377
Year ended December 31, 2024
January 23, 2024						March 8, 2024						March 22, 2024						$	1.63					$	379
April 16, 2024						June 10, 2024						June 25, 2024						1.63						378
July 16, 2024						September 10, 2024						September 25, 2024						1.63						378
October 15, 2024						December 5, 2024						December 20, 2024						1.63						373

On January 27, 2026, our Audit Committee declared a quarterly cash dividend to shareholders of $1.72 per share on the outstanding shares of our common stock. This quarterly dividend is payable on March 25, 2026 to the shareholders of record as of March 10, 2026.

Under our Board of Directors’ authorization, we maintain a common stock repurchase program. On October 15, 2024, our Audit Committee, pursuant to authorization granted by the Board of Directors, authorized an $8,000 increase to the common stock repurchase program. No duration has been placed on our common stock repurchase program, and we reserve the right to discontinue the program at any time. We intend to utilize this authorization over a multi-year period, subject to market and industry conditions. Repurchases may be made from time to time at prevailing market prices, subject to certain restrictions on volume, pricing and timing. The repurchases are affected from time to time in the open market, through negotiated transactions, including accelerated share repurchase agreements, and through plans designed to comply with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. Our stock repurchase program is discretionary, as we are under no obligation to repurchase shares. We repurchase shares under the program when we believe it is a prudent use of

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Notes to Consolidated Financial Statements (continued)

capital. The excess cost of the repurchased shares over par value is charged on a pro rata basis to additional paid-in capital and retained earnings.

A summary of common stock repurchases for the years ended December 31, 2025 and 2024 is as follows:

									Years Ended December 31
			2025						2024
Shares repurchased									7.4						6.7
Average price per share									$	350.39					$	435.32
Aggregate cost - excluding excise tax									$	2,605					$	2,900
Authorization remaining at end of year									$	6,695					$	9,300

We expect to utilize the remaining authorized amount over a multi-year period, subject to market and industry conditions.

For additional information regarding the use of capital for debt security repurchases, see Note 13, “Debt.”

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Notes to Consolidated Financial Statements (continued)

16. Accumulated Other Comprehensive Income (Loss)

A reconciliation of the components of accumulated other comprehensive income (loss) included in total shareholders' equity at December 31, 2025, 2024, and 2023 is as follows:

			2025						2024						2023
Net unrealized investment gains (losses):
Beginning of year balance			($523)						($632)						($1,755)
Other comprehensive income (loss), before reclassifications, net of tax benefit (expense) of ($163), $44, and ($218), respectively			530						(153)						760
Amounts reclassified from accumulated other comprehensive income, net of tax benefit (expense) of ($31), ($82), and ($113), respectively			103						256						357
Other comprehensive income			633						103						1,117
Other comprehensive (income) loss attributable to noncontrolling interests, net of tax (benefit) expense of $—, ($1), and ($1), respectively			(4)						6						6
End of year balance			106						(523)						(632)
Non-credit components of impairments on investments:
Beginning of year balance			(2)						(3)						(3)
Other comprehensive income (loss), net of tax benefit (expense) of $1, ($1), and $—, respectively			(1)						1						—
End of year balance			(3)						(2)						(3)
Net cash flow hedges:
Beginning of year balance			(207)						(211)						(229)
Other comprehensive income (loss), net of tax benefit (expense) of ($4), ($4), and $6, respectively			8						4						18
End of year balance			(199)						(207)						(211)
Pension and other benefits:
Beginning of year balance			(399)						(459)						(499)
Other comprehensive income (loss), net of tax benefit (expense) of ($16), $—, and ($39), respectively			67						60						40
End of year balance			(332)						(399)						(459)
Future policy benefits:
Beginning of year balance			8						10						13
Other comprehensive income (loss), net of tax benefit (expense) of $1, $1, and $1, respectively			(3)						(2)						(3)
End of year balance			5						8						10
Foreign currency translation adjustments:
Beginning of year balance			(24)						(18)						(17)
Other comprehensive income (loss), net of tax benefit (expense) of $—, $—, and $1			(4)						(6)						(1)
End of year balance			(28)						(24)						(18)
Total:
Total beginning of year accumulated other comprehensive income (loss)			(1,147)						(1,313)						(2,490)
Total other comprehensive income, net of tax benefit (expense) of ($212), ($42), and ($362), respectively			700						160						1,171
Total other comprehensive (income) loss attributable to noncontrolling interests, net of tax (benefit) expense of $—, ($1), and ($1), respectively			(4)						6						6
Total end of year accumulated other comprehensive income (loss)			($451)						($1,147)						($1,313)

17. Reinsurance

We reinsure certain risks with other companies and assume risk from other companies. We remain primarily liable to policyholders under ceded insurance contracts and are contingently liable for amounts recoverable from reinsurers in the event that such reinsurers do not meet their contractual obligations.

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Notes to Consolidated Financial Statements (continued)

A summary of direct, assumed and ceded premiums earned for the years ended December 31, 2025, 2024 and 2023 is as follows:

									2025												2024												2023
Direct									$	159,653											$	139,479											$	136,927
Assumed									5,100												4,753												5,988
Ceded									(114)												(66)												(61)
Net premiums									$	164,639											$	144,166											$	142,854
Percentage—assumed to net premiums									3.1		%										3.3		%										4.2		%

The difference between written premiums and earned premiums is immaterial in each of the years presented above. All assumed and ceded activity reflected in the table above relates to our Health Benefits reportable segment.

The effect of reinsurance on benefit expense for the years ended December 31, 2025, 2024 and 2023 is as follows:

			2025						2024						2023
Direct			$	143,820					$	123,602					$	119,409
Assumed			4,475						4,021						4,984
Ceded			(72)						(56)						(63)
Net benefit expense			$	148,223					$	127,567					$	124,330

18. Leases

We lease office space and certain computer and related equipment using noncancelable operating leases. Our leases have remaining lease terms of 1 year to 11 years.

The information related to our leases is as follows:

			Balance Sheet Location						December 31, 2025						December 31, 2024
Operating Leases
ROU assets			Other noncurrent assets						$	452					$	567
Lease liabilities, current			Other current liabilities						131						153
Lease liabilities, noncurrent			Other noncurrent liabilities						$	529					$	658

			Years Ended December 31
			2025						2024						2023
Lease Expense
Operating lease expense			$	116					$	147					$	155
Short-term and variable lease expense			42						47						43
Sublease income			(5)						(6)						(5)
Total lease expense			$	153					$	188					$	193

During the years ended December 31, 2025, 2024 and 2023, we reduced our office space footprint and concurrently performed an interim impairment test for related ROU assets. We recorded impairment charges of $7, $17 and $23, respectively, for impairment and abandonment of ROU assets which are included in the operating lease expense shown above.

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Notes to Consolidated Financial Statements (continued)

												Years Ended December 31
												2025						2024
Other information
Operating cash paid for amounts included in the measurement of lease liabilities, operating leases												$	176					$	202
ROU assets obtained in exchange for new lease liabilities, operating leases												33						63
ROU assets derecognized (terminations/modifications)												$	(75)					$	(19)
Weighted average remaining lease term in years, operating leases												6						6
Weighted average discount rate, operating leases												4.05		%				3.96		%

At December 31, 2025, future lease payments for noncancelable operating leases with initial or remaining terms of one year or more are as follows:

2026			$	159
2027			133
2028			121
2029			110
2030			91
Thereafter			129
Total future minimum payments			743
Less imputed interest			(83)
Total lease liabilities			$	660

19. Shareholders’ Earnings per Share

The denominator for basic and diluted shareholders’ earnings per share at December 31, 2025, 2024 and 2023 is as follows:

			2025						2024						2023
Denominator for basic shareholders’ earnings per share—weighted-average shares			224.0						231.7						235.9
Effect of dilutive securities—employee stock options, non-vested restricted stock awards and convertible debentures			0.6						1.2						1.5
Denominator for diluted shareholders’ earnings per share			224.6						232.9						237.4

During the years ended December 31, 2025, 2024 and 2023, weighted-average shares related to certain stock options of 1.9, 0.7 and 0.8, respectively, were excluded from the denominator for diluted shareholders’ earnings per share because the stock options were anti-dilutive.

We have issued approximately 0.7 cumulative restricted stock units under our stock incentive plans, of which vesting is contingent upon us meeting specified annual earnings targets. Contingent restricted stock units are excluded from the denominator for diluted shareholders’ earnings per share and are included only if and when the contingency is met. These contingent restricted stock units are being measured over a three-year period and generally vest in March of the year following each measurement period.

20. Segment Information

We report our results of operations in the following four reportable segments: Health Benefits, CarelonRx, Carelon Services and Corporate & Other. An immaterial amount of our total consolidated revenues is derived from activities outside of the U.S. and Puerto Rico.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

Our Health Benefits segment offers a comprehensive suite of health plans and services to our Individual, Employer Group risk-based, Employer Group fee-based, BlueCard®, Medicare, Medicaid and FEP® members. The Health Benefits segment offers health products on a full-risk basis; provides a broad array of administrative managed care services to our fee-based customers; and provides a variety of specialty and other insurance products and services such as stop loss, dental, vision and supplemental health insurance benefits.

Our CarelonRx segment includes our pharmacy services business. CarelonRx markets and offers pharmacy services to our affiliated health plan customers, as well as to external customers outside of the health plans we own. CarelonRx offers a comprehensive pharmacy services portfolio, which includes all core pharmacy services, such as home delivery and specialty pharmacies, claims adjudication, formulary management, pharmacy networks, rebate administration, a prescription drug database and member services, as well as infusion services and injectable therapies.

Our Carelon Services segment integrates physical, behavioral, pharmacy, and social services with the aim of delivering whole health affordably by offering a broad array of healthcare related services and capabilities to internal and external customers through our Carelon Health and Carelon Insights businesses. Carelon promotes affordability by managing complex areas of the healthcare system, leveraging data and insights to ensure members receive safe, appropriate, high-quality care and providers are reimbursed accurately and timely. Our approach to cost management relies on capabilities including provider enablement, value-based networks, member engagement, and utilization management. Our care delivery services primarily target serving chronic and complex populations by providing personalized care in the home and virtually. As a part of Carelon Health, we completed our acquisition of CareBridge at the end of 2024, which provides virtual care to complex Medicaid and Medicare patients and supports plans in managing home and community-based services.

Our Corporate & Other segment includes our businesses that do not individually meet the quantitative threshold for an operating segment, as well as corporate expenses not allocated to our other reportable segments.

We define operating revenues to include premiums, product revenue and service fees. Operating revenues are derived from premiums and fees received, primarily from the sale and administration of health benefits and pharmacy products and services. Operating gain is calculated as total operating revenue less benefit expense, cost of products sold and operating expense.

Affiliated operating revenues represent revenues or costs for services provided to our subsidiaries by CarelonRx and Carelon Services, in addition to certain administrative and other services provided by our international businesses, which are recorded at cost or management’s estimate of fair market value. These affiliated operating revenues are eliminated in our consolidated financial statements. For segment reporting, we present all capitation risk arrangements on a gross basis; therefore, eliminations also include adjustments for capitated risk arrangements that are recognized on a net basis under GAAP.

Through our participation in various federal government programs, we generated approximately 32%, 31% and 29% of our total consolidated revenues from agencies of the U.S. government for the year ended December 31, 2025, 2024 and 2023, respectively. The majority of these revenues are contained in our Health Benefits segment.

The accounting policies of the segments are consistent with those described in the summary of significant accounting policies in Note 2, “Basis of Presentation and Significant Accounting Policies,” except that all capitation risk arrangements are reported on a gross basis with an adjustment included in eliminations for capitated risk arrangements that are presented on a net basis under GAAP.

Our chief operating decision maker (the “CODM”) is our Chief Executive Officer. The CODM assesses the performance of our reportable segments based on operating gain or loss as defined above. The CODM evaluates net investment income, net gains (losses) on financial instruments, interest expense, depreciation and amortization expense, income taxes and assets, liabilities and equity on a consolidated basis, as these items are managed in a corporate shared service environment and are not the responsibility of segment operating management.

The CODM uses operating gain or loss, developed during the annual budget process, and updated during the periodic forecasting process, as a basis to assess performance and allocate operating and capital resources to each segment.

Financial data by reportable segment for the years ended December 31, 2025, 2024 and 2023 is as follows:

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

									Carelon
			Health Benefits						CarelonRx						Carelon Services						Total						Corporate & Other						Eliminations						Total
Year Ended December 31, 2025
Premiums			$	159,458					$	—					$	6,315					$	6,315					$	—					$	(1,134)					$	164,639
Product revenue			—						24,470						—						24,470						—						—						24,470
Service fees			7,636						13						826						839						—						—						8,475
Operating revenue - unaffiliated			167,094						24,483						7,141						31,624						—						(1,134)						197,584
Operating revenue - affiliated			—						18,917						21,175						40,092						463						(40,555)						—
Operating revenue - total			$	167,094					$	43,400					$	28,316					$	71,716					$	463					$	(41,689)					$	197,584
Benefit expense			$	143,889					$	—					$	24,283					$	24,283					$	25					$	(19,974)					$	148,223
Cost of products sold			—						40,077						—						40,077						—						(18,899)						21,178
Operating expense			19,047						905						3,073						3,978						775						(2,816)						20,984
Operating gain (loss)			$	4,158					$	2,418					$	960					$	3,378					$	(337)					$	—					$	7,199
Year Ended December 31, 2024
Premiums			$	142,668					$	—					$	2,630					$	2,630					$	—					$	(1,132)					$	144,166
Product revenue			—						22,630						—						22,630						—						—						22,630
Service fees			7,607						5						790						795						6						—						8,408
Operating revenue - unaffiliated			150,275						22,635						3,420						26,055						6						(1,132)						175,204
Operating revenue - affiliated			—						13,326						14,541						27,867						303						(28,170)						—
Operating revenue - total			$	150,275					$	35,961					$	17,961					$	53,922					$	309					$	(29,302)					$	175,204
Benefit expense			$	126,703					$	—					$	14,388					$	14,388					$	19					$	(13,543)					$	127,567
Cost of products sold			—						32,978						—						32,978						—						(13,228)						19,750
Operating expense			17,329						811						2,856						3,667						1,560						(2,531)						20,025
Operating gain (loss)			$	6,243					$	2,172					$	717					$	2,889					$	(1,270)					$	—					$	7,862
Year Ended December 31, 2023
Premiums			$	141,515					$	—					$	1,679					$	1,679					$	—					$	(340)					$	142,854
Product revenue			—						19,452						—						19,452						—						—						19,452
Service fees			7,056						6						813						819						28						—						7,903
Operating revenue - unaffiliated			148,571						19,458						2,492						21,950						28						(340)						170,209
Operating revenue - affiliated			—						14,377						11,655						26,032						451						(26,483)						—
Operating revenue - total			$	148,571					$	33,835					$	14,147					$	47,982					$	479					$	(26,823)					$	170,209
Benefit expense			$	123,705					$	—					$	10,610					$	10,610					$	35					$	(10,020)					$	124,330
Cost of products sold			—						31,588						—						31,588						—						(14,295)						17,293
Operating expense			17,978						272						2,857						3,129						1,488						(2,508)						20,087
Operating gain (loss)			$	6,888					$	1,975					$	680					$	2,655					$	(1,044)					$	—					$	8,499

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

A reconciliation of reportable segments’ operating revenue to the amounts of total revenues included in our consolidated statements of income for the years ended December 31, 2025, 2024 and 2023 is as follows:

			2025						2024						2023
Reportable segments’ operating revenues			$	197,584					$	175,204					$	170,209
Net investment income			2,194						2,051						1,825
Net losses on financial instruments			(653)						(445)						(694)
Gain on sale of business			—						201						—
Total revenues			$	199,125					$	177,011					$	171,340

A reconciliation of reportable segments’ operating gain to income before income tax expense included in our consolidated statements of income for the years ended December 31, 2025, 2024 and 2023 is as follows:

			2025						2024						2023
Income before income tax expense			$	6,710					$	7,904					$	7,715
Net investment income			(2,194)						(2,051)						(1,825)
Net losses on financial instruments			653						445						694
Gain on sale of business			—						(201)						—
Interest expense			1,402						1,185						1,030
Amortization of other intangible assets			628						580						885
Reportable segments’ operating gain			$	7,199					$	7,862					$	8,499

21. Statutory Information

The majority of our insurance and HMO subsidiaries report their accounts in conformity with accounting practices prescribed or permitted by state insurance regulatory authorities, commonly referred to as statutory accounting, which vary in certain respects from GAAP. However, certain of our insurance and HMO subsidiaries, including Blue Cross of California, Blue Cross of California Partnership Plan, Inc. and Carelon Behavioral Health of California, Inc. are regulated by the California Department of Managed Health Care (“DMHC”) and report their accounts in conformity with GAAP (these entities are collectively referred to as the “DMHC regulated entities”). Typical differences of GAAP reporting as compared to statutory reporting are the recognition of all assets including those that are non-admitted for statutory purposes and recognition of all deferred tax assets without regard to statutory limits. The National Association of Insurance Commissioners (the “NAIC”) developed a codified version of the statutory accounting principles, designed to foster more consistency among the states for accounting guidelines and reporting. Prescribed statutory accounting practices are set forth in a variety of publications of the NAIC as well as state laws, regulations and general administrative rules.

Our statutory basis insurance and HMO subsidiaries are subject to risk-based capital (“RBC”) requirements. RBC is a method developed by the NAIC to determine the minimum amount of statutory capital appropriate for an insurance company or HMO to support its overall business operations in consideration of its size and risk profile. The formula for determining the amount of RBC specifies various factors, weighted based on the perceived degree of risk, which are applied to certain financial balances and financial activity. Below minimum RBC requirements are classified within certain levels, each of which requires specified corrective action. Additionally, the DMHC regulated entities are subject to capital and solvency requirements as prescribed by the DMHC. As of December 31, 2025 and 2024, all of our regulated subsidiaries exceeded the minimum applicable mandatory RBC requirements and/or capital and solvency requirements of their applicable governmental regulator.

The statutory RBC necessary to satisfy regulatory requirements of our statutory basis insurance and HMO subsidiaries was approximately $9,100 as of December 31, 2025. The tangible net equity required for the DMHC regulated entities was approximately $1,100 as of December 31, 2025. Statutory-basis capital and surplus of our insurance and HMO subsidiaries and capital and surplus of our other regulated subsidiaries, excluding the DMHC regulated entities, was $22,611 at December 31, 2025. GAAP equity of the DMHC regulated entities was $2,969 at December 31, 2025.

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Elevance Health, Inc.

Notes to Consolidated Financial Statements (continued)

Our ability to pay dividends and credit obligations is significantly dependent on receipt of dividends from our subsidiaries. The payment of dividends to us by our insurance and HMO subsidiaries without prior approval of the insurance departments of each subsidiary’s domiciliary jurisdiction is limited by formula. Dividends in excess of these amounts are subject to prior approval by the respective state insurance departments or the DMHC. During 2025, our insurance and HMO subsidiaries paid aggregate cash dividends of $2,543 to the parent company, including cash dividends which required prior approval from regulatory authorities. We currently estimate that approximately $2,100 of dividends will be paid to the parent company in 2026.