cnc-20250630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

___________________________________________

FORM 10-Q

____________________________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to _____

____________________________________________

Commission file number: 001-31826

____________________________________________

CENTENE CORPORATION

(Exact name of registrant as specified in its charter)


Delaware		42-1406317
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

7700 Forsyth Boulevard
St. Louis,	Missouri	63105
(Address of principal executive offices)		(Zip Code)

Registrant's telephone number, including area code: (314) 725-4477

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock $0.001 Par Value	CNC	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files) ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company", and "emerging growth company" in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 23, 2025, the registrant had 491,133 thousand shares of common stock outstanding.

CENTENE CORPORATION

QUARTERLY REPORT ON FORM 10-Q

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		PAGE

Part I
Financial Information
Item 1.	Financial Statements	1
	Consolidated Balance Sheets as of June 30, 2025 (unaudited) and December 31, 2024	1
	Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024 (unaudited)	2
	Consolidated Statements of Comprehensive Earnings (Loss) for the Three and Six Months Ended June 30, 2025 and 2024 (unaudited)	3
	Consolidated Statements of Stockholders' Equity for the Three and Six Months Ended June 30, 2025 and 2024 (unaudited)	4
	Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 (unaudited)	5
	Notes to the Consolidated Financial Statements (unaudited)	6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	38
Item 4.	Controls and Procedures	38
Part II
Other Information
Item 1.	Legal Proceedings	39
Item 1A.	Risk Factors	39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	44
Item 5.	Other Information	44
Item 6.	Exhibits	45
Signatures		46

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CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

All statements, other than statements of current or historical fact, contained in this filing are forward-looking statements. Without limiting the foregoing, forward-looking statements often use words such as "believe," "anticipate," "plan," "expect," "estimate," "intend," "seek," "target," "goal," "may," "will," "would," "could," "should," "can," "continue," and other similar words or expressions (and the negative thereof). Centene Corporation and its subsidiaries (Centene, the Company, our or we) intends such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and we are including this statement for purposes of complying with these safe-harbor provisions. In particular, these statements include, without limitation, statements about our expected future operating or financial performance, changes in laws and regulations, market opportunity, expectations concerning pricing actions, competition, expected contract start dates and terms, expected activities in connection with completed and future acquisitions and dispositions, our investments, and the adequacy of our available cash resources. These statements may be found in the various sections of this filing, such as Part I, Item 2. "Management's Discussion and Analysis of Financial Condition and Results of Operations," Part II, Item 1. "Legal Proceedings," and Part II, Item 1A. "Risk Factors."

These forward-looking statements reflect our current views with respect to future events and are based on numerous assumptions and assessments made by us in light of our experience and perception of historical trends, current conditions, business strategies, operating environments, future developments, and other factors we believe appropriate. By their nature, forward-looking statements involve known and unknown risks and uncertainties and are subject to change because they relate to events and depend on circumstances that will occur in the future, including economic, regulatory, competitive, and other factors that may cause our or our industry's actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by these forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties, and assumptions.

All forward-looking statements included in this filing are based on information available to us on the date of this filing. Except as may be otherwise required by law, we undertake no obligation to update or revise the forward-looking statements included in this filing, whether as a result of new information, future events, or otherwise, after the date of this filing. You should not place undue reliance on any forward-looking statements, as actual results may differ materially from projections, estimates, or other forward-looking statements due to a variety of important factors, variables, and events including, but not limited to:

•our ability to design and price products that are competitive and/or actuarially sound;

•our ability to accurately predict and effectively manage health benefits and other operating expenses and reserves, including fluctuations in medical costs;

•rate cuts, insufficient rate changes or other payment reductions or delays by government payors affecting our government businesses;

•the effect of social, economic, and political conditions, geopolitical events and state and federal policies, including the amount and terms of state and federal funding for government-sponsored healthcare programs, including as a result of changes in U.S. presidential administrations or Congress;

•changes in federal or state laws or regulations, including changes with respect to income tax reform or government healthcare programs as well as changes with respect to the Patient Protection and Affordable Care Act and the Health Care and Education Affordability Reconciliation Act (collectively referred to as the ACA) and any regulations enacted thereunder, including the timing and terms of renewal or modification of the enhanced advance premium tax credits or program integrity initiatives that could have the effect of reducing membership or profitability of our products;

•unanticipated increased healthcare costs, including due to changes in consumer and provider behaviors, inflation and tariffs;

•our ability to maintain or achieve improvement in the Centers for Medicare and Medicaid Services (CMS) Star ratings and maintain or achieve improvement in other quality scores in each case that could impact revenue and future growth;

•competition, including for providers, broker distribution networks, contract reprocurements and organic growth;

•our ability to adequately anticipate demand and timely provide for operational resources to maintain service level requirements in compliance with the terms of our contracts and state and federal regulations;

•our ability to comply with the terms of our contracts and state and federal regulations and our ability to effectively oversee our third-party vendors to comply with the terms of their contracts with us and state and federal regulations;

•our ability to manage our information systems effectively;

•disruption, unexpected costs, or similar risks from business transactions, including acquisitions, divestitures, and changes in our relationships with third-party vendors;

•impairments to real estate, investments, goodwill and intangible assets;

•changes in senior management, loss of one or more key personnel or an inability to attract, hire, integrate and retain skilled personnel;

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•membership and revenue declines or unexpected trends;

•changes in healthcare practices, new technologies, and advances in medicine;

•our ability to effectively and ethically use artificial intelligence and machine learning in compliance with applicable laws;

•changes in macroeconomic conditions, including inflation, interest rates and volatility in the financial markets;

•negative public perception of the Company and the managed care industry;

•uncertainty concerning government shutdowns, debt ceilings or funding;

•tax matters;

•disasters, climate-related incidents, acts of war or aggression or major epidemics;

•changes in expected contract start dates and terms;

•changes in provider, broker, vendor, state, federal and other contracts and delays in the timing of regulatory approval of contracts, including due to protests and our ability to timely comply with any such changes to our contractual requirements or manage any unexpected delays in regulatory approval of contracts;

•the expiration, suspension, or termination of our contracts with federal or state governments (including, but not limited to, Medicaid, Medicare or other customers);

•the difficulty of predicting the timing or outcome of legal or regulatory audits, investigations, proceedings or matters including, but not limited to, our ability to resolve claims and/or allegations on acceptable terms, or at all, or whether additional claims, reviews or investigations will be brought;

•challenges to our contract awards;

•cyber-attacks or other data security incidents or our failure to comply with applicable privacy, data or security laws and regulations;

•the exertion of management's time and our resources, and other expenses incurred and business changes required in connection with complying with the terms of our contracts and the undertakings in connection with any regulatory, governmental, or third party consents or approvals for acquisitions or dispositions;

•any changes in expected closing dates, estimated purchase price, or accretion for acquisitions or dispositions;

•losses in our investment portfolio;

•restrictions and limitations in connection with our indebtedness;

•a downgrade of our corporate family rating, issuer rating or credit rating of our indebtedness; and

•the availability of debt and equity financing on terms that are favorable to us.

This list of important factors is not intended to be exhaustive. We discuss certain of these matters more fully, as well as certain other factors that may affect our business operations, financial condition, and results of operations, in our filings with the Securities and Exchange Commission (SEC), including our annual report on Form 10-K, other quarterly reports on Form 10-Q and current reports on Form 8-K. Due to these important factors and risks, we cannot give assurances with respect to our future performance, including without limitation our ability to maintain adequate premium levels or our ability to control our future medical and selling, general and administrative costs.

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Non-GAAP Financial Presentation

The Company is providing certain non-GAAP financial measures in this report as the Company believes that these figures are helpful in allowing investors to more accurately assess the ongoing nature of the Company's operations and measure the Company's performance more consistently across periods. The Company uses the presented non-GAAP financial measures internally in evaluating the Company's performance and for planning purposes, by allowing management to focus on period-to-period changes in the Company's core business operations, and in determining employee incentive compensation. Therefore, the Company believes that this information is meaningful in addition to the information contained in the GAAP presentation of financial information. The Company strongly encourages investors to review its consolidated financial statements and publicly filed reports in their entirety and cautions investors that the non-GAAP financial measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.

Specifically, the Company believes the presentation of non-GAAP financial measures that excludes amortization of acquired intangible assets, acquisition and divestiture related expenses, as well as other items, allows investors to develop a more meaningful understanding of the Company's core performance over time.

The tables below provide reconciliations of non-GAAP items ($ in millions, except per share data):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024

GAAP net earnings (loss) attributable to Centene	$	(253)	$	1,146	$	1,058	$	2,309
Amortization of acquired intangible assets	173		173		346		346
Acquisition and divestiture related expenses	1		6		1		67
Other adjustments (1)	58		2		61		(97)
Income tax effects of adjustments (2)	(58)		(44)		(100)		(126)
Adjusted net earnings (loss)	$	(79)	$	1,283	$	1,366	$	2,499

GAAP diluted earnings (loss) per share attributable to Centene	$	(0.51)	$	2.16	$	2.13	$	4.32
Amortization of acquired intangible assets	0.35		0.33		0.70		0.65
Acquisition and divestiture related expenses	—		0.01		—		0.13
Other adjustments (1)	0.12		—		0.12		(0.18)
Income tax effects of adjustments (2)	(0.12)		(0.08)		(0.20)		(0.24)
Adjusted diluted earnings (loss) per share	$	(0.16)	$	2.42	$	2.75	$	4.68

(1) Other adjustments include the following pre-tax items:

2025:

(a) for the three months ended June 30, 2025: intangible asset impairment related to the wind-down of certain contracts in the Other segment of $55 million, or $0.11 per share ($0.08 after-tax), and a reduction to the previously reported gain on real estate transactions of $3 million, or $0.01 per share ($0.01 after-tax);

(b) for the six months ended June 30, 2025: intangible asset impairment related to the wind-down of certain contracts in the Other segment of $55 million, or $0.11 per share ($0.08 after-tax), a reduction to the previously reported gain on the sale of Magellan Rx of $10 million, or $0.02 per share ($0.02 after-tax), and a net gain on real estate transactions of $4 million, or $0.01 per share ($0.01 after-tax).

iii

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2024:

(a) for the three months ended June 30, 2024: gain on the previously reported divestiture of Circle Health Group (Circle Health) of $10 million, or $0.02 per share ($0.02 after-tax), an additional loss on the divestiture of our Spanish and Central European businesses of $7 million, or $0.01 per share ($0.01 after-tax), severance costs due to a restructuring of $4 million, or $0.01 per share ($0.01 after-tax), reduction to the net gain on the sale of property due to closing costs of $3 million, or $0.00 per share ($0.00 after-tax), and net gain on the finalization of working capital adjustments for the previously reported divestiture of Magellan Specialty Health of $2 million, or $0.00 per share ($0.00 after-tax);

(b) for the six months ended June 30, 2024: net gain on the previously reported divestiture of Magellan Specialty Health due to the achievement of contingent consideration and finalization of working capital adjustments of $83 million, or $0.15 per share ($0.11 after-tax), net gain on the sale of property of $21 million, or $0.04 per share ($0.03 after-tax), gain on the previously reported divestiture of Circle Health Group of $20 million, or $0.04 per share ($0.12 after-tax), Health Net Federal Services asset impairment due to the 2024 final ruling on the TRICARE Managed Care Support Contract of $14 million, or $0.03 per share ($0.02 after-tax), severance costs due to a restructuring of $13 million, or $0.02 per share ($0.02 after-tax), an additional loss on the divestiture of our Spanish and Central European businesses of $7 million, or $0.01 per share ($0.01 after-tax), and gain on the previously reported divestiture of HealthSmart due to the finalization of working capital adjustments of $7 million, or $0.01 per share ($0.01 after-tax).

(2) The income tax effects of adjustments are based on the effective income tax rates applicable to each adjustment.


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024

GAAP selling, general and administrative expenses	$	3,036	$	2,894	$	6,389	$	6,112
Less:
Acquisition and divestiture related expenses	1		6		1		67
Restructuring costs	—		4		—		13


Adjusted selling, general and administrative expenses	$	3,035	$	2,884	$	6,388	$	6,032

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PART I

FINANCIAL INFORMATION

Item 1. Financial Statements.

CENTENE CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In millions, except shares in thousands and per share data in dollars)


	June 30, 2025		December 31, 2024
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	14,513	$	14,063
Premium and trade receivables	21,552		19,713
Short-term investments	2,768		2,622
Other current assets	1,556		1,601
Total current assets	40,389		37,999
Long-term investments	18,797		17,429
Restricted deposits	1,411		1,390
Property, software and equipment, net	2,122		2,067

Goodwill	17,558		17,558
Intangible assets, net	5,010		5,409
Other long-term assets	1,108		593
Total assets	$	86,395	$	82,445
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND STOCKHOLDERS' EQUITY
Current liabilities:
Medical claims liability	$	20,117	$	18,308
Accounts payable and accrued expenses	13,520		13,174
Return of premium payable	2,442		2,008
Unearned revenue	682		661
Current portion of long-term debt	25		110
Total current liabilities	36,786		34,261
Long-term debt	17,552		18,423
Deferred tax liability	651		684
Other long-term liabilities	3,903		2,567
Total liabilities	58,892		55,935
Commitments and contingencies
Redeemable noncontrolling interests	11		10
Stockholders' equity:
Preferred stock, $0.001 par value; authorized 10,000 shares; no shares issued or outstanding at June 30, 2025 and December 31, 2024	—		—
Common stock, $0.001 par value; authorized 800,000 shares; 622,834 issued and 491,128 outstanding at June 30, 2025, and 620,195 issued and 495,907 outstanding at December 31, 2024	1		1
Additional paid-in capital	20,671		20,562
Accumulated other comprehensive (loss)	(231)		(504)
Retained earnings	16,406		15,348
Treasury stock, at cost (131,706 and 124,288 shares, respectively)	(9,441)		(8,997)
Total Centene stockholders' equity	27,406		26,410
Nonredeemable noncontrolling interest	86		90
Total stockholders' equity	27,492		26,500
Total liabilities, redeemable noncontrolling interests and stockholders' equity	$	86,395	$	82,445

The accompanying notes to the consolidated financial statements are an integral part of these statements.

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CENTENE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except shares in thousands and per share data in dollars)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Revenues:
Premium	$	41,740	$	35,140	$	83,452	$	70,669
Service	727		833		1,504		1,641
Premium and service revenues	42,467		35,973		84,956		72,310
Premium tax	6,275		3,863		10,406		7,933
Total revenues	48,742		39,836		95,362		80,243
Expenses:
Medical costs	38,808		30,765		75,311		61,697
Cost of services	641		680		1,339		1,349
Selling, general and administrative expenses	3,036		2,894		6,389		6,112
Depreciation expense	141		133		283		268
Amortization of acquired intangible assets	173		173		346		346
Premium tax expense	6,346		3,962		10,563		8,123

Impairment	55		—		55		13

Total operating expenses	49,200		38,607		94,286		77,908
Earnings (loss) from operations	(458)		1,229		1,076		2,335
Other income (expense):
Investment and other income	371		463		753		1,008

Interest expense	(170)		(176)		(340)		(354)
Earnings (loss) before income tax	(257)		1,516		1,489		2,989
Income tax expense	2		370		434		685
Net earnings (loss)	(259)		1,146		1,055		2,304
Loss attributable to noncontrolling interests	6		—		3		5
Net earnings (loss) attributable to Centene Corporation	$	(253)	$	1,146	$	1,058	$	2,309

Net earnings (loss) per common share attributable to Centene Corporation:
Basic earnings (loss) per common share	$	(0.51)	$	2.16	$	2.14	$	4.34
Diluted earnings (loss) per common share	$	(0.51)	$	2.16	$	2.13	$	4.32

Weighted average number of common shares outstanding:
Basic	493,548		529,602		494,896		532,385
Diluted	493,548		530,755		496,328		534,517

The accompanying notes to the consolidated financial statements are an integral part of these statements.

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CENTENE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (LOSS)

(In millions, unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Net earnings (loss)	$	(259)	$	1,146	$	1,055	$	2,304
Change in unrealized gain (loss) on investments	136		(26)		352		(107)
Change in unrealized gain (loss) on investments, tax effect	(32)		6		(82)		21
Change in unrealized gain (loss) on investments, net of tax	104		(20)		270		(86)

Reclassification adjustment, net of tax	2		4		3		92


Other comprehensive earnings (loss)	106		(16)		273		6
Comprehensive earnings (loss)	(153)		1,130		1,328		2,310
Comprehensive loss attributable to noncontrolling interests	6		—		3		5
Comprehensive earnings (loss) attributable to Centene Corporation	$	(147)	$	1,130	$	1,331	$	2,315

The accompanying notes to the consolidated financial statements are an integral part of these statements.

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CENTENE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(In millions, except shares in thousands and per share data in dollars)

(Unaudited)

Three and Six Months Ended June 30, 2025


	Centene Stockholders' Equity
	Common Stock									Treasury Stock
	$0.001 Par Value Shares	Amt		Additional Paid-in Capital		Accumulated Other Comprehensive Earnings (Loss)		Retained Earnings		$0.001 Par Value Shares	Amt		Noncontrolling Interest		Total
Balance, December 31, 2024	620,195	$	1	$	20,562	$	(504)	$	15,348	124,288	$	(8,997)	$	90	$	26,500
Comprehensive Earnings:
Net earnings (loss)	—	—		—		—		1,311		—	—		1		1,312
Other comprehensive earnings, net of $50 tax	—	—		—		167		—		—	—		—		167


Common stock issued for employee benefit plans	2,316	—		10		—		—		—	—		—		10
Common stock repurchases	—	—		—		—		—		705	(41)		—		(41)
Stock compensation expense	—	—		59		—		—		—	—		—		59





Balance, March 31, 2025	622,511	$	1	$	20,631	$	(337)	$	16,659	124,993	$	(9,038)	$	91	$	28,007
Comprehensive Earnings (Loss):
Net earnings (loss)	—	—		—		—		(253)		—	—		(5)		(258)
Other comprehensive earnings, net of $33 tax	—	—		—		106		—		—	—		—		106


Common stock issued for employee benefit plans	340	—		9		—		—		—	—		—		9
Common stock repurchases	(17)	—		(4)		—		—		6,713	(403)		—		(407)
Stock compensation expense	—	—		35		—		—		—	—		—		35





Balance, June 30, 2025	622,834	$	1	$	20,671	$	(231)	$	16,406	131,706	$	(9,441)	$	86	$	27,492

Three and Six Months Ended June 30, 2024


	Centene Stockholders' Equity
	Common Stock									Treasury Stock
	$0.001 Par Value Shares	Amt		Additional Paid-in Capital		Accumulated Other Comprehensive Earnings (Loss)		Retained Earnings		$0.001 Par Value Shares	Amt		Noncontrolling Interest		Total
Balance, December 31, 2023	615,291	$	1	$	20,304	$	(652)	$	12,043	80,807	$	(5,856)	$	97	$	25,937
Comprehensive Earnings:
Net earnings (loss)	—	—		—		—		1,163		—	—		(4)		1,159
Other comprehensive earnings, net of $(12) tax	—	—		—		22		—		—	—		—		22
Common stock issued for employee benefit plans	3,882	—		14		—		—		—	—		—		14
Common stock repurchases	—	—		—		—		—		1,983	(151)		—		(151)
Stock compensation expense	—	—		70		—		—		—	—		—		70
Divestiture of non-controlling interest	—	—		—		—		—		—	—		(3)		(3)
Balance, March 31, 2024	619,173	$	1	$	20,388	$	(630)	$	13,206	82,790	$	(6,007)	$	90	$	27,048
Comprehensive Earnings:
Net earnings (loss)	—	—		—		—		1,146		—	—		—		1,146
Other comprehensive loss, net of $(5) tax	—	—		—		(16)		—		—	—		—		(16)
Common stock issued for employee benefit plans	322	—		11		—		—		—	—		—		11
Common stock repurchases	—	—		—		—		—		10,704	(810)		—		(810)
Stock compensation expense	—	—		62		—		—		—	—		—		62

Balance, June 30, 2024	619,495	$	1	$	20,461	$	(646)	$	14,352	93,494	$	(6,817)	$	90	$	27,441

The accompanying notes to the consolidated financial statements are an integral part of these statements.

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CENTENE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions, unaudited)


	Six Months Ended June 30,
	2025		2024
Cash flows from operating activities:
Net earnings	$	1,055	$	2,304
Adjustments to reconcile net earnings to net cash provided by operating activities
Depreciation and amortization	629		614
Stock compensation expense	94		132
Impairment	55		13


Deferred income taxes	(116)		40
(Gain) loss on divestitures, net	10		(103)

Other adjustments, net	16		(11)
Changes in assets and liabilities
Premium and trade receivables	(1,801)		(1,059)
Other assets	(543)		(404)

Medical claims liabilities	1,809		173
Unearned revenue	21		(118)
Accounts payable and accrued expenses	209		(1,704)
Other long-term liabilities	1,857		1,838
Other operating activities, net	—		4
Net cash provided by operating activities	3,295		1,719
Cash flows from investing activities:
Capital expenditures	(343)		(337)
Purchases of investments	(3,593)		(3,434)
Sales and maturities of investments	2,508		2,497

Divestiture proceeds, net of divested cash	—		959

Net cash (used in) investing activities	(1,428)		(315)
Cash flows from financing activities:
Proceeds from long-term debt	750		350
Payments and repurchases of long-term debt	(1,707)		(565)

Common stock repurchases	(473)		(954)
Proceeds from common stock issuances	18		25



Other financing activities, net	(12)		(4)
Net cash (used in) financing activities	(1,424)		(1,148)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	—		7
Net increase in cash, cash equivalents and restricted cash and cash equivalents	443		263

Cash, cash equivalents and restricted cash and cash equivalents, beginning of period	14,156		17,452
Cash, cash equivalents and restricted cash and cash equivalents, end of period	$	14,599	$	17,715
Supplemental disclosures of cash flow information:
Interest paid	$	320	$	352
Income taxes paid, net	$	504	$	551


The following table provides a reconciliation of cash, cash equivalents and restricted cash and cash equivalents reported within the Consolidated Balance Sheets to the totals above:
	June 30,
	2025		2024
Cash and cash equivalents	$	14,513	$	17,605
Restricted cash and cash equivalents, included in restricted deposits	86		110
Total cash, cash equivalents and restricted cash and cash equivalents	$	14,599	$	17,715

The accompanying notes to the consolidated financial statements are an integral part of these statements.

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CENTENE CORPORATION AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Organization and Operations

Basis of Presentation

The accompanying interim financial statements have been prepared under the presumption that users of the interim financial information have either read or have access to the audited financial statements included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2024. The unaudited interim financial statements herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Accordingly, footnote disclosures that would substantially duplicate the disclosures contained in the December 31, 2024 audited financial statements have been omitted from these interim financial statements, where appropriate. In the opinion of management, these financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of the results of the interim periods presented.

Certain 2024 amounts in the consolidated financial statements and notes to the consolidated financial statements have been reclassified to conform to the 2025 presentation. These reclassifications have no effect on net earnings or stockholders' equity as previously reported.

Recent Accounting Guidance Not Yet Adopted

In November 2024, the Financial Accounting Standards Board issued Accounting Standards Update 2024-03 - Income Statement - Reporting Comprehensive Income: Disaggregation of Income Statement Expenses which expands disclosures about specific expense categories presented on the face of the Statement of Operations. The new standard is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. The Company is currently evaluating the effect of the new disclosure requirements.

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2. Short-term and Long-term Investments, Restricted Deposits

Short-term and long-term investments and restricted deposits by investment type consist of the following ($ in millions):


	June 30, 2025								December 31, 2024
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Debt securities:
U.S. Treasury securities and obligations of U.S. government corporations and agencies	$	566	$	3	$	(2)	$	567	$	593	$	2	$	(4)	$	591
Corporate securities	11,641		127		(224)		11,544		10,820		47		(360)		10,507
Restricted certificates of deposit	2		—		—		2		4		—		—		4
Restricted cash equivalents	86		—		—		86		93		—		—		93
Short-term time deposits	574		—		—		574		425		—		—		425
Municipal securities	4,151		21		(108)		4,064		4,174		7		(151)		4,030
Asset-backed securities	1,985		19		(12)		1,992		1,820		13		(21)		1,812
Residential mortgage-backed securities	1,861		7		(95)		1,773		1,807		1		(129)		1,679
Commercial mortgage-backed securities	1,314		9		(43)		1,280		1,298		3		(62)		1,239
Equity securities	13		—		—		13		14		—		—		14
Private equity investments	877		—		—		877		851		—		—		851
Life insurance contracts	204		—		—		204		196		—		—		196
Total	$	23,274	$	186	$	(484)	$	22,976	$	22,095	$	73	$	(727)	$	21,441

The Company's investments are debt securities classified as available-for-sale with the exception of equity securities, certain private equity investments and life insurance contracts. Private equity investments include direct investments in private equity securities as well as private equity funds. The Company's investment policies are designed to provide liquidity, preserve capital and maximize total return on invested assets with a focus on high credit quality securities. The Company limits the size of investment in any single issuer other than U.S. treasury securities and obligations of U.S. government corporations and agencies. As of June 30, 2025, 99% of the Company's investments in rated securities carry an investment grade rating by nationally recognized statistical rating organizations. At June 30, 2025, the Company held certificates of deposit, equity securities, private equity investments and life insurance contracts, which did not carry a credit rating. Accrued interest income on available-for-sale debt securities was $191 million and $178 million at June 30, 2025 and December 31, 2024, respectively, and is included in other current assets in the Consolidated Balance Sheets.

The Company's residential mortgage-backed securities are primarily issued by the Federal National Mortgage Association, Government National Mortgage Association or Federal Home Loan Mortgage Corporation, which carry implicit or explicit guarantees of the U.S. government. The Company's commercial mortgage-backed securities are primarily senior tranches with a weighted average rating of AA+ and a weighted average duration of 3 years at June 30, 2025.

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The fair value of available-for-sale debt securities with gross unrealized losses by investment type and length of time that individual securities have been in a continuous unrealized loss position were as follows ($ in millions):


	June 30, 2025								December 31, 2024
	Less Than 12 Months				12 Months or More				Less Than 12 Months				12 Months or More
	Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value
U.S. Treasury securities and obligations of U.S. government corporations and agencies	$	—	$	97	$	(2)	$	86	$	(1)	$	60	$	(3)	$	144
Corporate securities	(7)		1,031		(217)		4,120		(41)		2,621		(319)		4,782
Municipal securities	(6)		706		(102)		1,871		(16)		1,217		(135)		2,073
Asset-backed securities	(1)		287		(11)		252		(4)		301		(17)		331
Residential mortgage-backed securities	(6)		440		(89)		709		(18)		786		(111)		738
Commercial mortgage-backed securities	(1)		165		(42)		573		(4)		210		(58)		666
Short-term time deposits	—		24		—		—		—		—		—		—
Total	$	(21)	$	2,750	$	(463)	$	7,611	$	(84)	$	5,195	$	(643)	$	8,734

As of June 30, 2025, the gross unrealized losses were generated from 4,214 positions out of a total of 6,779 positions. The change in fair value of available-for-sale debt securities is primarily a result of movement in interest rates subsequent to the purchase of the security.

For each security in an unrealized loss position, the Company assesses whether it intends to sell the security or if it is more likely than not the Company will be required to sell the security before recovery of the amortized cost basis for reasons such as liquidity, contractual or regulatory purposes. If the security meets this criterion, the decline in fair value is recorded in earnings. The Company does not intend to sell these securities prior to maturity and it is not likely that the Company will be required to sell these securities prior to maturity; therefore, the Company did not record an impairment for these securities.

In addition, the Company monitors available-for-sale debt securities for credit losses. Certain investments have experienced a decline in fair value due to changes in credit quality, market interest rates and/or general economic conditions. The Company recognizes an allowance when evidence demonstrates that the decline in fair value is credit related. Evidence of a credit-related loss may include rating agency actions, adverse conditions specifically related to the security or failure of the issuer of the security to make scheduled payments.

The contractual maturities of short-term and long-term debt securities and restricted deposits are as follows ($ in millions):


	June 30, 2025								December 31, 2024
	Investments				Restricted Deposits				Investments				Restricted Deposits
	Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value
One year or less	$	2,576	$	2,562	$	529	$	529	$	2,383	$	2,365	$	477	$	475
One year through five years	8,315		8,196		525		512		7,799		7,563		610		593
Five years through ten years	4,548		4,515		327		327		4,343		4,172		301		291
Greater than ten years	157		153		43		43		165		160		31		31
Asset-backed securities	5,160		5,045		—		—		4,925		4,730		—		—
Total	$	20,756	$	20,471	$	1,424	$	1,411	$	19,615	$	18,990	$	1,419	$	1,390

Actual maturities may differ from contractual maturities due to call or prepayment options. Equity securities, private equity investments and life insurance contracts are excluded from the table above because they do not have a contractual maturity. The Company has an option to redeem substantially all of the securities included in the greater than ten years category listed above at amortized cost.

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3. Fair Value Measurements

Assets and liabilities recorded at fair value in the Consolidated Balance Sheets are categorized based upon observable or unobservable inputs used to estimate fair value. Level inputs 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 table summarizes fair value measurements by level at June 30, 2025, for assets and liabilities measured at fair value on a recurring basis ($ in millions):


	Level I		Level II		Level III		Total
Assets
Cash and cash equivalents	$	14,513	$	—	$	—	$	14,513
Investments:
U.S. Treasury securities and obligations of U.S. government corporations and agencies	$	72	$	—	$	—	$	72
Corporate securities	—		11,534		—		11,534
Municipal securities	—		3,246		—		3,246
Short-term time deposits	—		574		—		574
Asset-backed securities	—		1,992		—		1,992
Residential mortgage-backed securities	—		1,773		—		1,773
Commercial mortgage-backed securities	—		1,280		—		1,280
Equity securities	12		1		—		13
Total investments	$	84	$	20,400	$	—	$	20,484
Restricted deposits:
Cash and cash equivalents	$	86	$	—	$	—	$	86
U.S. Treasury securities and obligations of U.S. government corporations and agencies	495		—		—		495
Corporate securities	—		10		—		10
Certificates of deposit	—		2		—		2
Municipal securities	—		818		—		818
Total restricted deposits	$	581	$	830	$	—	$	1,411


Total assets at fair value	$	15,178	$	21,230	$	—	$	36,408

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The following table summarizes fair value measurements by level at December 31, 2024, for assets and liabilities measured at fair value on a recurring basis ($ in millions):


	Level I		Level II		Level III		Total
Assets
Cash and cash equivalents	$	14,063	$	—	$	—	$	14,063
Investments:
U.S. Treasury securities and obligations of U.S. government corporations and agencies	$	58	$	—	$	—	$	58
Corporate securities	—		10,505		—		10,505
Municipal securities	—		3,272		—		3,272
Short-term time deposits	—		425		—		425
Asset-backed securities	—		1,812		—		1,812
Residential mortgage-backed securities	—		1,679		—		1,679
Commercial mortgage-backed securities	—		1,239		—		1,239
Equity securities	13		1		—		14
Total investments	$	71	$	18,933	$	—	$	19,004
Restricted deposits:
Cash and cash equivalents	$	93	$	—	$	—	$	93
U.S. Treasury securities and obligations of U.S. government corporations and agencies	533		—		—		533
Corporate securities	—		2		—		2
Certificates of deposit	—		4		—		4
Municipal securities	—		758		—		758
Total restricted deposits	$	626	$	764	$	—	$	1,390



Total assets at fair value	$	14,760	$	19,697	$	—	$	34,457

The Company utilizes matrix-pricing services to estimate fair value for securities which are not actively traded on the measurement date. The Company designates these securities as Level II fair value measurements. In addition, the aggregate carrying amount of the Company's private equity investments and life insurance contracts, which approximates fair value, was $1,081 million and $1,047 million as of June 30, 2025 and December 31, 2024, respectively.

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4. Medical Claims Liability

The following table summarizes the change in medical claims liability for the six months ended June 30, 2025 ($ in millions):


	Medicaid		Medicare		Commercial		Other		Consolidated Total
Balance, January 1, 2025	$	10,299	$	3,358	$	4,463	$	188	$	18,308
Less: Reinsurance recoverable	18		—		47		—		65
Balance, January 1, 2025, net	10,281		3,358		4,416		188		18,243

Incurred related to:
Current year	42,377		16,186		17,160		1,038		76,761
Prior years	(953)		(341)		(429)		(24)		(1,747)
Total incurred	41,424		15,845		16,731		1,014		75,014
Paid related to:
Current year	33,532		12,858		12,987		882		60,259
Prior years	7,745		2,252		3,083		158		13,238
Total paid	41,277		15,110		16,070		1,040		73,497
Plus: Premium deficiency reserve	—		297		—		—		297
Balance, June 30, 2025, net	10,428		4,390		5,077		162		20,057
Plus: Reinsurance recoverable	14		—		46		—		60
Balance, June 30, 2025	$	10,442	$	4,390	$	5,123	$	162	$	20,117

The following table summarizes the change in medical claims liability for the six months ended June 30, 2024 ($ in millions):


	Medicaid		Medicare		Commercial		Other		Consolidated Total
Balance, January 1, 2024	$	10,814	$	3,612	$	3,460	$	114	$	18,000
Less: Reinsurance recoverable	5		—		44		—		49
Balance, January 1, 2024, net	10,809		3,612		3,416		114		17,951

Incurred related to:
Current year	39,398		10,953		12,274		758		63,383
Prior years	(1,136)		(316)		(326)		7		(1,771)
Total incurred	38,262		10,637		11,948		765		61,612
Paid related to:
Current year	30,696		8,093		9,143		633		48,565
Prior years	7,918		2,562		2,367		121		12,968
Total paid	38,614		10,655		11,510		754		61,533
Plus: Premium deficiency reserve	—		85		—		—		85
Balance, June 30, 2024, net	10,457		3,679		3,854		125		18,115
Plus: Reinsurance recoverable	15		—		43		—		58
Balance, June 30, 2024	$	10,472	$	3,679	$	3,897	$	125	$	18,173

Reinsurance recoverables related to medical claims are included in premium and trade receivables. Changes in estimates of incurred claims for prior years are primarily attributable to reserving under moderately adverse conditions. Additionally, as a result of development within "Incurred related to: Prior years," the Company recorded $69 million and $88 million as a reduction to premium revenue in the six months ended June 30, 2025 and 2024, respectively, for minimum medical loss ratio (MLR) and other return of premium programs.

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Incurred but not reported (IBNR) plus expected development on reported claims as of June 30, 2025 was $13,353 million. Total IBNR plus expected development on reported claims represents estimates for claims incurred but not reported, development on reported claims and estimates for the costs necessary to process unpaid claims at the end of each period. The Company estimates its liability using actuarial methods that are commonly used by health insurance actuaries and meet Actuarial Standards of Practice. These actuarial methods consider factors such as historical data for payment patterns, cost trends, product mix, seasonality, utilization of healthcare services and other relevant factors.

The Company reviews actual and anticipated experience compared to the assumptions used to establish medical costs. The Company establishes premium deficiency reserves if actual and anticipated experience indicates that existing policy liabilities together with the present value of future gross premiums will not be sufficient to cover the present value of future benefits, settlement and maintenance costs. For purposes of determining premium deficiencies, contracts are grouped in a manner consistent with the method of acquiring, servicing and measuring the profitability of such contracts and expected investment income is excluded. In December 2024, the Company recorded a premium deficiency reserve of $92 million related to the 2025 Medicare Advantage contract year. The premium deficiency reserve was increased to $270 million in the first quarter of 2025 and to $389 million in the second quarter of 2025 based on the progression of earnings during the year (with higher earnings at the beginning of the year and lower at the end of the year, given cost sharing progression), including anticipated impacts of the Inflation Reduction Act to the Part D benefit within the Company's Medicare Advantage business. In December 2023, the Company recorded a premium deficiency reserve of $250 million related to the 2024 Medicare Advantage contract year, which was increased to $300 million in the first quarter of 2024 and to $335 million in the second quarter of 2024 consistent with the progression of earnings during the year.

5. Affordable Care Act

The Affordable Care Act established risk spreading premium stabilization programs as well as a minimum annual MLR and cost sharing reductions.

The Company's net receivables (payables) for each of the programs are as follows ($ in millions):


	June 30, 2025		December 31, 2024
Risk adjustment receivable	$	2,132	$	1,434
Risk adjustment payable	(2,769)		(1,605)
Minimum medical loss ratio	(1,062)		(688)
Cost sharing reduction receivable	19		305
Cost sharing reduction payable	(79)		(74)

In June 2025, the Centers for Medicare and Medicaid Services (CMS) announced the final risk adjustment transfers for the 2024 benefit year. Based on the Company's estimate of the final settlement, the risk adjustment net receivable was increased by $490 million in the first half of 2025. After consideration of minimum MLR and other related impacts, the net pre-tax benefit recognized was $211 million in the six months ended June 30, 2025.

As of June 30, 2025, the Company's 2025 net risk adjustment payable was $985 million.

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6. Debt

Debt consists of the following ($ in millions):


	June 30, 2025		December 31, 2024
$2,500 million 4.25% Senior Notes due December 15, 2027	$	2,399	$	2,398
$2,300 million 2.45% Senior Notes due July 15, 2028	2,302		2,302
$3,500 million 4.625% Senior Notes due December 15, 2029	3,277		3,277
$2,000 million 3.375% Senior Notes due February 15, 2030	2,000		2,000
$2,200 million 3.00% Senior Notes due October 15, 2030	2,200		2,200
$2,200 million 2.50% Senior Notes due March 1, 2031	2,200		2,200
$1,300 million 2.625% Senior Notes due August 1, 2031	1,300		1,300

Total senior notes	15,678		15,677
Term Loan Facility	2,000		2,006
Revolving Credit Agreement	—		950

Debt issuance costs	(101)		(100)
Total debt	17,577		18,533
Less: current portion	(25)		(110)
Long-term debt	$	17,552	$	18,423

Revolving Credit Facility and Term Loan Credit Facility

On March 5, 2025, the Company entered into a new Credit Agreement (New Credit Agreement) and terminated all outstanding commitments and repaid all outstanding obligations under the Fourth Amended and Restated Credit Agreement, dated as of August 16, 2021 (as amended).

The New Credit Agreement provides for (i) a revolving credit facility in the principal amount of $4,000 million (the Revolving Credit Facility) and (ii) a term loan facility in the principal amount of $2,000 million (the Term Loan Facility). The maturity date for the New Credit Agreement is March 5, 2030. Loans under the Revolving Credit Facility may be denominated in U.S. dollars, Euros, Sterling, Swiss Francs, Yen, Australian dollars and Canadian dollars and each other currency which has been approved under the terms of the New Credit Agreement.

Borrowings under the New Credit Agreement will bear interest at a fluctuating rate per annum equal to a benchmark rate applicable to the currency composing such borrowing plus an applicable margin. The applicable margin is in each case based on the rating of Centene's corporate debt obligations by S&P and Moody's and is primarily a linear progression corresponding to the Company's credit rating as defined in the New Credit Agreement. The applicable margin for base rate loans changes in increments of 0.25% increasing or decreasing between pricing levels at the corresponding rating level.

The Company is subject to a financial covenant under the New Credit Agreement, tested quarterly, whereby the debt-to-capital ratio may not exceed 0.60 to 1.00, with a step-up, upon the Company's election, following the consummation of a material acquisition, to 0.65 to 1.00 during certain specified periods.

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7. Stockholders' Equity

The Company's Board of Directors has authorized a stock repurchase program of the Company's common stock from time to time on the open market or through privately negotiated transactions. The Company is authorized to repurchase up to $10,000 million, inclusive of past authorizations. As of June 30, 2025, the Company had a remaining amount of $1,830 million available under the stock repurchase program.

The following represents the Company's share repurchase activity ($ in millions, shares in thousands):


		Three Months Ended June 30,						Six Months Ended June 30,
		2025			2024			2025			2024
		Shares	Cost		Shares	Cost		Shares	Cost		Shares	Cost
Share buybacks		6,713	$	400	10,660	$	800	6,713	$	400	11,341	$	851
Income tax withholding		—	—		44	3		705	41		1,346	103
Total share repurchases (1)		6,713	$	400	10,704	$	803	7,418	$	441	12,687	$	954

(1)	Excludes year-to-date share repurchase excise tax of approximately $3 million and $7 million accrued as of June 30, 2025 and 2024, respectively.

Prior to the adoption of the 2025 Stock Incentive Plan in May 2025, shares repurchased for income tax withholding were shares withheld in connection with employee stock plans to meet applicable tax withholding requirements. These shares were typically included in the Company's treasury stock. After the adoption of the 2025 Stock Incentive Plan, shares repurchased for income tax withholding are typically recorded as a reduction to additional paid-in capital.

8. Earnings Per Share

The following table sets forth the calculation of basic and diluted net earnings per common share ($ in millions, except per share data in dollars and shares in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024

Earnings (loss) attributable to Centene Corporation	$	(253)	$	1,146	$	1,058	$	2,309

Shares used in computing per share amounts:
Weighted average number of common shares outstanding	493,548		529,602		494,896		532,385
Common stock equivalents (as determined by applying the treasury stock method)	—		1,153		1,432		2,132
Weighted average number of common shares and potential dilutive common shares outstanding	493,548		530,755		496,328		534,517

Net earnings (loss) per common share attributable to Centene Corporation:
Basic earnings (loss) per common share	$	(0.51)	$	2.16	$	2.14	$	4.34
Diluted earnings (loss) per common share	$	(0.51)	$	2.16	$	2.13	$	4.32

The calculation of diluted earnings per common share for the three months ended June 30, 2025 excludes 2,464 thousand shares related to stock options, restricted stock and restricted stock units as their effect would have been anti-dilutive due to the net loss for the quarter. The three months ended June 30, 2024 excludes 271 thousand shares related to anti-dilutive stock options, restricted stock and restricted stock units.

The calculation of diluted earnings per common share for the six months ended June 30, 2025 and 2024 excludes 1,660 thousand shares and 267 thousand shares, respectively, related to anti-dilutive stock options, restricted stock, and restricted stock units.

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9. Segment Information

The Company operates in four segments: (1) a Medicaid segment, (2) a Medicare segment, (3) a Commercial segment and (4) an Other segment. The Medicaid, Medicare and Commercial segments primarily represent the government-sponsored or subsidized programs under which the Company offers managed healthcare services. The Other segment includes the Company's pharmacy operations, vision and dental services, clinical healthcare, behavioral health, and corporate management company, among others.

Factors used in determining the reportable business segments include the nature of operating activities, the existence of separate senior management teams and the type of information presented to the Company's chief operating decision-maker (CODM) to evaluate all results of operations. The Company's CODM is its Chief Executive Officer. The Company's CODM focuses primarily on each segment's ability to generate sufficient revenues and manage expenses associated with health benefits and cost of services (including estimated costs incurred). As such, the CODM measures operating performance at the segment level based on gross margin, including evaluation of budget to actual variances, to determine the allocation of financial and capital resources for each segment. The Company does not report total assets by segment since this is not a metric used by the Company's CODM to allocate resources or evaluate segment performance.

Segment information for the three months ended June 30, 2025, is as follows ($ in millions):


		Medicaid		Medicare		Commercial		Other/Eliminations		Consolidated Total
Premium		$	21,697	$	9,450	$	10,070	$	523	$	41,740
Service		26		—		—		701		727
Premium and service revenues		21,723		9,450		10,070		1,224		42,467
Premium tax		6,275		—		—		—		6,275
Total external revenues		27,998		9,450		10,070		1,224		48,742
Internal revenues		—		—		—		3,967		3,967
Eliminations		—		—		—		(3,967)		(3,967)
Total revenues		$	27,998	$	9,450	$	10,070	$	1,224	$	48,742

Medical costs		$	20,581	$	8,587	$	9,124	$	516	$	38,808
Cost of services		25		—		—		616		641
Other operating expenses (1)										9,751
Other income (expense) (2)										201
Earnings before income tax expense										$	(257)

Segment gross margin (3)		$	1,117	$	863	$	946	$	92	$	3,018

(1)	Other operating expenses include selling, general and administrative expenses, depreciation, amortization, premium tax expense and impairment.
(2)	Other income (expense) includes investment and other income, debt extinguishment and interest expense.
(3)	Segment gross margin represents premium and service revenues less medical costs and cost of services.

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Segment information for the three months ended June 30, 2024, is as follows ($ in millions):


		Medicaid		Medicare		Commercial		Other/Eliminations		Consolidated Total
Premium		$	20,229	$	5,978	$	8,534	$	399	$	35,140
Service		21		—		1		811		833
Premium and service revenues		20,250		5,978		8,535		1,210		35,973
Premium tax		3,863		—		—		—		3,863
Total external revenues		24,113		5,978		8,535		1,210		39,836
Internal revenues		—		—		—		4,081		4,081
Eliminations		—		—		—		(4,081)		(4,081)
Total revenues		$	24,113	$	5,978	$	8,535	$	1,210	$	39,836

Medical costs		$	18,767	$	5,333	$	6,268	$	397	$	30,765
Cost of services		22		—		—		658		680
Other operating expenses (1)										7,162
Other income (expense) (2)										287
Earnings before income tax expense										$	1,516

Segment gross margin (3)		$	1,461	$	645	$	2,267	$	155	$	4,528

(1)	Other operating expenses include selling, general and administrative expenses, depreciation, amortization, premium tax expense and impairment.
(2)	Other income (expense) includes investment and other income, debt extinguishment and interest expense.
(3)	Segment gross margin represents premium and service revenues less medical costs and cost of services.

Segment information for the six months ended June 30, 2025, is as follows ($ in millions):


		Medicaid		Medicare		Commercial		Other/Eliminations		Consolidated Total
Premium		$	43,972	$	18,209	$	20,218	$	1,053	$	83,452
Service		50		—		1		1,453		1,504
Premium and service revenues		44,022		18,209		20,219		2,506		84,956
Premium tax		10,406		—		—		—		10,406
Total external revenues		54,428		18,209		20,219		2,506		95,362
Internal revenues		—		—		—		8,131		8,131
Eliminations		—		—		—		(8,131)		(8,131)
Total revenues		$	54,428	$	18,209	$	20,219	$	2,506	$	95,362

Medical costs		$	41,424	$	16,142	$	16,731	$	1,014	$	75,311
Cost of services		49		—		—		1,290		1,339
Other operating expenses (1)										17,636
Other income (expense) (2)										413
Earnings before income tax expense										$	1,489

Segment gross margin (3)		$	2,549	$	2,067	$	3,488	$	202	$	8,306

(1)	Other operating expenses include selling, general and administrative expenses, depreciation, amortization, premium tax expense and impairment.
(2)	Other income (expense) includes investment and other income, debt extinguishment and interest expense.
(3)	Segment gross margin represents premium and service revenues less medical costs and cost of services.

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Segment information for the six months ended June 30, 2024, is as follows ($ in millions):


		Medicaid		Medicare		Commercial		Other/Eliminations		Consolidated Total
Premium		$	41,667	$	11,913	$	16,284	$	805	$	70,669
Service		43		—		2		1,596		1,641
Premium and service revenues		41,710		11,913		16,286		2,401		72,310
Premium tax		7,933		—		—		—		7,933
Total external revenues		49,643		11,913		16,286		2,401		80,243
Internal revenues		—		—		—		8,161		8,161
Eliminations		—		—		—		(8,161)		(8,161)
Total revenues		$	49,643	$	11,913	$	16,286	$	2,401	$	80,243

Medical costs		$	38,262	$	10,722	$	11,948	$	765	$	61,697
Cost of services		43		—		—		1,306		1,349
Other operating expenses (1)										14,862
Other income (expense) (2)										654
Earnings before income tax expense										$	2,989

Segment gross margin (3)		$	3,405	$	1,191	$	4,338	$	330	$	9,264

(1)	Other operating expenses include selling, general and administrative expenses, depreciation, amortization, premium tax expense and impairment.
(2)	Other income (expense) includes investment and other income, debt extinguishment and interest expense.
(3)	Segment gross margin represents premium and service revenues less medical costs and cost of services.

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10. Contingencies

The Company is routinely subjected to legal and regulatory proceedings in the normal course of business. These matters can include, without limitation:

•periodic compliance and other reviews and investigations by various federal and state regulatory agencies with respect to requirements applicable to the Company's business, including, without limitation, those related to payment of out-of-network claims, compliance with the CMS Medicare and Marketplace regulations, including risk adjustment, prior authorizations and broker compensation, compliance with the False Claims Act, the calculation of minimum MLR and rebates related thereto, submissions to state agencies related to payments or state false claims acts, pre-authorization penalties, timely review of grievances and appeals, timely and accurate payment of claims, provider directory accuracy, cybersecurity issues, including those related to the Company's or the Company's third-party vendors' information systems, and the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and other federal and state fraud, waste and abuse laws;

•litigation arising out of general business activities, such as tax matters, disputes related to healthcare benefits coverage or reimbursement, putative securities class actions, and medical malpractice, privacy, real estate, intellectual property, vendor disputes and employment-related claims; and

•disputes regarding reinsurance arrangements, claims arising out of the acquisition or divestiture of various assets, class actions and claims relating to the performance of contractual and non-contractual obligations to providers, members, employer groups, vendors and others, including, but not limited to, the alleged failure to properly pay claims and challenges to the manner in which the Company processes claims, claims related to network adequacy and claims alleging that the Company has engaged in unfair business practices.

Among other things, these matters may result in corrective action plans, awards of damages, fines or penalties, which could be substantial, and/or could require changes to the Company's business and cause reputational harm. The Company intends to vigorously defend itself against legal and regulatory proceedings to which it is currently a party; however, these proceedings are subject to many uncertainties. In some of the cases pending against the Company, substantial non-economic or punitive damages are being sought.

The Company records reserves and accrues costs for certain legal proceedings and regulatory matters to the extent that it determines an unfavorable outcome is probable and the amount of the loss can be reasonably estimated. While such reserves and accrued costs reflect the Company's best estimate of the probable loss for such matters, the recorded amounts may differ materially from the actual amount of any such losses. In some cases, no estimate of the possible loss or range of loss in excess of amounts accrued, if any, can be made because of the inherently unpredictable nature of legal and regulatory proceedings, which may be exacerbated by various factors, including but not limited to, they may involve indeterminate claims for monetary damages or may involve fines, penalties or punitive damages; present novel legal theories or legal uncertainties; involve disputed facts; represent a shift in regulatory policy; involve a large number of parties, claimants or regulatory bodies; are in the early stages of the proceedings; involve a number of separate proceedings and/or a wide range of potential outcomes; or result in a change of business practices.

As of the date of this report, amounts accrued for legal proceedings and regulatory matters were not material. Except for the matter discussed below, the Company believes that the ultimate outcome of any of the regulatory and legal proceedings that are currently pending against it should not have a material adverse effect on financial condition, results of operations, cash flow or liquidity. However, it is possible that in a particular quarter or annual period the Company's financial condition, results of operations, cash flow and/or liquidity could be materially adversely affected by an ultimate unfavorable resolution of or development in legal and/or regulatory proceedings.

Federal Securities Class Action

On July 9, 2025, a putative federal securities class action, Brock Lunstrom v. Centene Corp., et al., was filed against the Company and certain of its executives in the U.S. District Court for the Southern District of New York. The plaintiffs in the lawsuit allege that the Company made false and misleading statements with respect to the Company's 2025 earnings guidance in violation of federal securities laws. The Company denies any wrongdoing and is vigorously defending itself against these claims. Nevertheless, this matter is subject to many uncertainties and the Company cannot predict how long this litigation will last, whether additional litigation will be filed with similar claims, or what the ultimate outcome will be, and an adverse outcome in this matter could potentially have a materially adverse impact on the Company's financial position and results of operations, cash flow or liquidity.

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11. Subsequent Events

As a result of market conditions subsequent to June 30, 2025, including the One Big Beautiful Bill Act, the Company plans to perform a quantitative impairment analysis to determine whether goodwill, intangibles or other assets are impaired, which may result in an impairment charge in a future period. While management cannot predict if or when future impairments may occur, such impairments could have a material impact on the Company's results of operations and shareholders' equity in the period in which the impairment occurs.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and the related notes included elsewhere in this filing. The discussion contains forward-looking statements that involve known and unknown risks and uncertainties.

EXECUTIVE OVERVIEW

General

We are a leading healthcare enterprise that is committed to helping people live healthier lives. The Company takes a local approach – with local brands and local teams – to provide fully integrated, high-quality and cost-effective services to government-sponsored and commercial healthcare programs, focusing on under-insured and uninsured individuals. Centene offers affordable and high-quality products to more than 1 in 15 individuals across the nation, including Medicaid and Medicare members (including Medicare Prescription Drug Plans) as well as individuals and families served by the Health Insurance Marketplace.

Our results of operations depend on our ability to manage expenses associated with health benefits (including estimated costs incurred) and selling, general and administrative (SG&A) costs. We measure operating performance based upon two key ratios. The health benefits ratio (HBR) represents medical costs as a percentage of premium revenues, excluding premium tax revenues that are separately billed, and reflects the direct relationship between the premiums received and the medical services provided. The SG&A expense ratio represents SG&A costs as a percentage of premium and service revenues, excluding premium taxes separately billed.

Trends and Uncertainties

Operating

We are currently experiencing an accelerated increase in medical cost trend. The drivers of trend include increasing medical demand, expanded access to care facilitated by program changes at the state level, and the rapid release and availability of new, high-cost pharmaceuticals. Increasingly, state healthcare policies are providing for expanded access through carve-ins for incremental coverage (for example, behavioral healthcare and home and community-based services).

The medical cost drivers are likely intensified by an environment where legislative changes to the United States healthcare model have been widely publicized (and with increasing intensity over the last six months). Changes to the model include references to members in certain programs who may lose eligibility and certain provider reimbursement models that may be reduced in the future. Changes in Medicaid and Marketplace, including changes in the availability of enhanced Advance Premium Tax Credits (APTCs) for Marketplace products coupled with the One Big Beautiful Bill Act (OBBBA), create member uncertainty surrounding the future availability, affordability, funding, and access to health insurance. This backdrop may be prompting members to seek care at an increased rate (given potential eligibility and subsidy funding shifts) and providers may be modifying operations, all further exacerbating the medical cost trend.

We continue to work with our state partners to establish Medicaid premium rates that appropriately match the acuity of the population as well as reflect the most recent medical cost trend. We also provide states with data to help them analyze the implications of policy decisions as well as design effective risk adjustment programs. In Marketplace, we commenced the process of refiling 2026 policy year rates to reflect a higher projected baseline of Marketplace morbidity than previously expected, and expect to be able to take corrective pricing actions for 2026 in states representing a substantial majority of our Marketplace membership.

Additionally, we are committed to ensuring that the affordability of healthcare is maintained for our government partners and members and continue to address the cost trend through the implementation of new clinical initiatives and care management plans, thoughtful network design, and ongoing rigor to combat fraud, waste and abuse.

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Regulatory: Medicaid

The COVID-19 pandemic impacted our business as it relates to Medicaid eligibility changes. From the onset of the public health emergency (PHE) through March 2023, our Medicaid membership increased by 3.6 million members (excluding new states North Carolina and Delaware and various state product expansions or managed care organization changes). Since March 31, 2023, redeterminations are the primary driver of our Medicaid membership decline. While some states may still be concluding the redetermination process for certain populations of members, we anticipate that any remaining reductions will be limited as the majority of states have substantially completed their unwinding processes as of December 2024. We continue to work with our state partners to match rates to acuity post-redeterminations.

The OBBBA, passed in July 2025, includes requirements that may reduce the number of members eligible for state Medicaid Expansion programs by requiring work or community engagement by members and for state Medicaid agencies to redetermine member eligibility at more frequent intervals, along with adding a "Cost Sharing" or "Co-Pay" for certain medical services. These changes could have the effect of increasing the overall morbidity of the Medicaid Expansion population as early as 2027. Several other provisions of the OBBBA, such as adjustments to provider taxes and state directed payments beginning in 2028, may have the effect of reducing the amount of federal funding for Medicaid, which could result in changes in the design of Medicaid programs, including coverage of benefits, eligibility, and/or provider payment rates.

Regulatory: Commercial

The American Rescue Plan Act (ARPA), enacted in March 2021, initially enhanced eligibility for APTCs for enrollees in the Health Insurance Marketplace. The enhanced eligibility extended by the Inflation Reduction Act (IRA), enacted in August 2022, expires at the end of 2025.

The Marketplace Integrity & Affordability Final Rule (Final Rule) was published in the Federal Register on June 25, 2025. The Final Rule makes changes to policies to strengthen program integrity measures in the Marketplace. For example, the Special Enrollment Period for those under 150% of the Federal Poverty Level (FPL) has been repealed beginning August 25, 2025. Further, beginning in plan year 2026, consumers who automatically re-enroll into a fully subsidized Marketplace plan will be re-enrolled into the same plan with a $5 premium until the consumer updates their exchange application to confirm APTC eligibility. In addition, exchanges may no longer accept a consumer's self-attestation of projected annual household income when the Internal Revenue Service (IRS) cannot verify it due to lack of tax return data; rather, exchanges must verify household income using other trusted data sources.

In addition, the OBBBA placed additional restrictions on APTC requirements. For example, beginning January 1, 2026, should individuals underestimate their projected income, the OBBBA requires them to reimburse the IRS for the full amount of excess tax credit received. In addition, as of January 1, 2026, the OBBBA prohibits individuals from receiving APTCs if they enroll in health coverage through a Special Enrollment Period associated with their income. We anticipate that the combined effect of the expiration of the enhanced APTCs, the Final Rule, and the OBBBA will reduce 2026 Marketplace membership and continue to increase the overall morbidity of the Marketplace population. We have commenced the process of refiling 2026 policy year rates to reflect a higher projected baseline of Marketplace morbidity than previously expected. We continue to advocate for legislation and regulations aimed at leveraging Medicaid and the Health Insurance Marketplace to maintain health insurance coverage and affordability for consumers.

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Regulatory: Medicare

The IRA significantly changed Medicare Prescription Drug Plans (PDPs) in 2025, most notably by eliminating the coverage gap and capping members' annual out-of-pocket costs at $2,000 in order to provide more predictable and affordable prescription drug coverage for Medicare beneficiaries. The IRA changes effective for 2025 result in a meaningful shift in cost-sharing responsibilities between members, drug companies, Centers for Medicare and Medicaid Services (CMS), and PDPs and have resulted in a significant increase in our premiums in consideration for our PDPs' responsibility for a larger portion of total Part D benefit costs. To help mitigate significant premium impacts and address these changes, CMS introduced the Medicare Part D Premium Stabilization Demonstration program. This program began in calendar year 2025 and was intended by CMS to exist for three years. The parameters of the program are expected to be different each year. CMS believes the demonstration will provide plans greater flexibility to manage costs and assist in stabilizing beneficiary premiums. We continue to advocate for policies that promote cost-effective, high-quality care for our PDP enrolled members. We have receivables due to us from CMS for Part D risk-sharing programs attributable to the 2024 and 2025 plan years that we expect to be paid by CMS approximately 12 to 13 months after the plan year closes. If the payments from CMS are delayed, our cash flows may be materially adversely affected.

Regulatory: Dual-Eligible

In addition, the CMS calendar year 2025 Medicare and Part D policy rule and finalized regulations will require beneficiaries dually enrolled in Medicare and a Medicaid Managed Care Plan to receive integrated care through the Medicaid company's Medicare Advantage Dual Eligible Special Needs Plans (D-SNPs) beginning in 2030, with certain provisions beginning in 2027. However, some states have already moved or are planning to exclusively align dual-eligible enrollment under an aligned D-SNP before this timeframe. We believe we are well positioned given our overlapping Medicaid and Medicare Advantage footprints and are committed to navigating evolving regulations.

Summary

We remain focused on the promise of delivering high-quality healthcare services on behalf of states and the federal government to under-insured and uninsured families and commercial organizations. Our decades of experience and deep industry knowledge has allowed us to deliver cost-effective services to our government partners and our members. With a focus on the personalization of healthcare technology, we continue the use of data and analytics to improve the provider and member experience. We continue to believe we have both the capacity and capability to successfully navigate industry changes to the benefit of our members, customers, providers, and shareholders.

Second Quarter 2025 Highlights

Our financial performance for the second quarter of 2025 is summarized as follows:

•Managed care membership of 28.0 million, a decrease of 473 thousand members, or (2)% year-over-year.

•Total revenues of $48.7 billion, representing 22% growth year-over-year.

•Premium and service revenues of $42.5 billion, representing 18% growth year-over-year.

•HBR of 93.0%, compared to 87.6% for the second quarter of 2024.

•SG&A expense ratio of 7.1%, compared to 8.0% for the second quarter of 2024.

•Adjusted SG&A expense ratio of 7.1%, compared to 8.0% for the second quarter of 2024.

•Operating cash flows provided cash of $1.8 billion in the second quarter of 2025.

•GAAP diluted loss per share was $(0.51) for the second quarter of 2025 primarily driven by a reduction in our net 2025 Marketplace risk adjustment revenue transfer estimate.

•Adjusted diluted loss per share of $(0.16) for the second quarter of 2025 primarily driven by a reduction in our net 2025 Marketplace risk adjustment revenue transfer estimate.

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A reconciliation from GAAP diluted earnings (loss) per share to adjusted diluted earnings (loss) per share is highlighted below, and additional detail is provided above under the heading "Non-GAAP Financial Presentation":

We reference an adjusted SG&A expense ratio, defined as adjusted SG&A expenses, which excludes acquisition and divestiture related expenses and other items, divided by premium and service revenues. A reconciliation from GAAP SG&A to adjusted SG&A and additional detail is provided above under the heading "Non-GAAP Financial Presentation." We also reference effective tax rate on adjusted earnings, defined as GAAP income tax expense (benefit) excluding the income tax effects of adjustments to net earnings divided by adjusted earnings (loss) before income tax expense.


	Three Months Ended June 30,
	2025		2024
GAAP diluted earnings (loss) per share attributable to Centene	$	(0.51)	$	2.16
Amortization of acquired intangible assets	0.35		0.33
Acquisition and divestiture related expenses	—		0.01
Other adjustments (1)	0.12		—
Income tax effects of adjustments (2)	(0.12)		(0.08)
Adjusted diluted earnings (loss) per share	$	(0.16)	$	2.42

(1) Other adjustments include the following pre-tax items:

2025:

(a) intangible asset impairment related to the wind-down of certain contracts in the Other segment of $55 million, or $0.11 per share ($0.08 after-tax), and a reduction to the previously reported gain on real estate transactions of $3 million, or $0.01 per share ($0.01 after-tax).

2024:

(a) gain on the previously reported divestiture of Circle Health Group (Circle Health) of $10 million, or $0.02 per share ($0.02 after-tax), an additional loss on the divestiture of our Spanish and Central European businesses of $7 million, or $0.01 per share ($0.01 after-tax), severance costs due to a restructuring of $4 million, or $0.01 per share ($0.01 after-tax), reduction to the net gain on the sale of property due to closing costs of $3 million, or $0.00 per share ($0.00 after-tax), and net gain on the finalization of working capital adjustments for the previously reported divestiture of Magellan Specialty Health of $2 million, or $0.00 per share ($0.00 after-tax).

(2) The income tax effects of adjustments are based on the effective income tax rates applicable to each adjustment.

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Current and Future Operating Drivers

The following items contributed to our results of operations as compared to the previous year:

Medicaid

•In February 2025, our subsidiary, Sunshine Health, commenced the expanded Statewide Medicaid Managed Care (SMMC) program, including integrated Managed Medical Assistance, Long-Term Care services, Serious Mental Illness, Child Welfare and HIV specialty products. The expanded SMMC program now includes coverage for Behavior Analysis services. The contract has a six-year term. Additionally, coverage for Behavior Analysis services was also added to the existing Children's Medical Services contract beginning February 2025.

•In January 2025, our subsidiary, Sunflower Health Plan, commenced the contract to continue providing managed health care services through KanCare, the State of Kansas' Medicaid and Children's Health Insurance Program. The contract has a three-year term, with two optional one-year extensions, for a total of five possible contract years.

•In October 2024, our subsidiary, Meridian Health Plan of Michigan, commenced the contract awarded by the Michigan Department of Health and Human Services (MDHHS) to continue serving as a Medicaid health plan for the Comprehensive Health Care Program. The contract has a five-year term, with three optional one-year extensions, for a total of eight possible contract years.

•In September 2024, our subsidiary, Superior HealthPlan (Superior), commenced the contract awarded by the Texas Health and Human Services Commission to continue to provide healthcare coverage to the aged, blind or disabled (ABD) population in the state's STAR+PLUS program. The contract has a six-year term with a maximum of three additional two-year extensions.

•In September 2024, our subsidiary, NH Healthy Families, commenced the contract awarded by the New Hampshire Department of Health and Human Services to continue providing physical health, behavioral health and pharmacy services for New Hampshire's Medicaid managed care program, known as Medicaid Care Management. The contract has a five-year term.

•In July 2024, our subsidiaries, Carolina Complete Health and WellCare of North Carolina, began coordinating physical and other health services with Local Management Entities/Managed Care Organizations under the state's new Tailored Plan program. The Tailored Plans are integrated health plans designed for individuals with significant behavioral health needs or intellectual/developmental disabilities.

•In June 2024, our subsidiary, Western Sky Community Care, concluded serving members upon the expiration of its New Mexico Medicaid managed care contract.

•In April 2024, our subsidiary, Oklahoma Complete Health, commenced the statewide contracts to provide managed care for the SoonerSelect and SoonerSelect Children's Specialty Plan programs. The new contracts have a one-year term with five, one-year renewal options.

•In January 2024, our subsidiary, Nebraska Total Care, commenced the statewide Medicaid managed care contract to continue serving the state's Medicaid Managed Care Program, known as Heritage Health. The initial contract term is five years and includes the option for two subsequent, one-year renewals, for a potential total of seven years.

•In January 2024, our California health plan commenced direct Medicaid contracts in 10 counties (Los Angeles, Sacramento, Amador, Calaveras, Inyo, Mono, San Joaquin, Stanislaus, Tulare and Tuolumne). In Los Angeles, a portion of the membership is subcontracted. Prior to January 2024, our California health plan previously served the state's Medicaid Managed Care population with contracts in 13 counties, including San Diego.

•In April 2023, eligibility redeterminations related to the PHE began. States have substantially completed their unwinding processes as of December 2024. We continue to work with our state partners to match rates to acuity post-redeterminations.

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Medicare / Dual-Eligible

•Given our strong bid positioning, PDP membership increased 19% year-over-year. Additionally, the IRA changes effective for 2025 result in a meaningful shift in cost-sharing responsibilities between members, drug companies, CMS, and PDPs and have led to a significant increase in our premiums in consideration for our PDPs responsibility for a larger portion of total Part D benefit costs. These changes also result in a change to the quarterly progression of the Medicare segment HBR.

•In December 2024, we recorded a premium deficiency reserve of $92 million related to the 2025 Medicare Advantage contract year. The premium deficiency reserve was increased to $270 million in the first quarter of 2025 and to $389 million in the second quarter of 2025 based on the progression of earnings during the year (with higher earnings at the beginning of the year and lower at the end of the year, given cost sharing progression). The premium deficiency reserve related to the 2025 Medicare Advantage contract year will be released in the fourth quarter of 2025.

•In 2025, Wellcare is offering Medicare Advantage plans in 32 states, including its newest state, Iowa. Wellcare discontinued offering Medicare Advantage products in Alabama, Massachusetts, New Hampshire, New Mexico, Rhode Island and Vermont in 2025. Consistent with our strategic positioning and bid strategy, Medicare Advantage membership declined 10% year-over-year.

Commercial

•On July 1, 2025, we announced a reduction to our expectation for the 2025 benefit year net risk adjustment revenue transfer as a result of significantly higher estimated aggregate market morbidity, with a corresponding decrease in our earnings expectations for 2025. Our updated risk adjustment transfer estimate has been incorporated in our June 30, 2025 financial results. The six months ended June 30, 2024, benefited from outperformance in Marketplace risk adjustment for the 2023 benefit year.

•In 2025, our Health Insurance Marketplace product, Ambetter Health, expanded its geographic footprint, adding 60 new counties across 10 states, which includes expansion into Iowa. Additionally, Marketplace membership increased 33% year-over-year due to the expanded footprint, strong open enrollment results, as well as overall market growth.

Other

•In December 2024, Health Net Federal Services concluded serving members upon the expiration of its TRICARE Managed Care Support Contract.

•In October 2024, we completed the sale of Collaborative Health Systems, a management services organization.

•In July 2024, our subsidiary, Magellan Health, commenced the Idaho Behavioral Health Plan contract.

The benefits of successful execution of our value creation initiatives have impacted our current results of operations and will continue to impact future results of operations, including the implementation of our new third-party pharmacy benefits management (PBM) contract, which commenced in January 2024.

We expect the following items to impact our future results of operations, subject to the resolution of various third-party protests within the Medicaid segment:

Medicaid

•In July 2025, our subsidiary, Iowa Total Care, commenced the contract to continue providing Medicaid managed care services under the Iowa Health Link program. The contract has a four-year term, with an optional two-year extension, for a total of six possible contract years.

•In July 2025, our subsidiary, Magnolia Health Plan (Magnolia), commenced the Mississippi Division of Medicaid contract to continue serving the state's Coordinated Care Organization Program consisting of the Mississippi Coordinated Access Network and the Mississippi CHIP. The contract has a four-year term, with two optional one-year extensions, for a total of six possible contract years.

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•In April 2025, our subsidiary, SilverSummit Healthplan, Inc., was selected by the Nevada Department of Health and Human Services to continue to provide services for its Medicaid managed care program. For the first time the program will include expansion of Medicaid Managed Care into rural and frontier service areas, communities that were previously fee-for-service. The contract is expected to begin in January 2026 and has a five-year term, with the option of a two-year extension, for a total of seven possible contract years.

•In September 2024, our subsidiary, Health Net Community Solutions, was selected by the California Department of Health Care Services to provide managed dental health care services to beneficiaries of Medi-Cal, the State's Medicaid program, in Los Angeles and Sacramento counties. The new 54-month contract is expected to begin in January 2026.

•In August 2024, our subsidiary, PA Health and Wellness, was selected by the Pennsylvania Department of Human Services to continue to administer Pennsylvania's Community HealthChoices program, the Medicaid managed care program that covers adults who are dually eligible for Medicare and Medicaid or who qualify to receive Medicaid long-term services and supports due to a need for the level of care provided in a nursing facility. The contract is expected to begin in January 2026 and has a five-year term, with three optional one-year extensions, for a total of eight possible contract years.

•In December 2023, our subsidiary, Arizona Complete Health, was selected by the Arizona Health Care Cost Containment System – Arizona's single state Medicaid agency – to provide managed care for the Arizona Long Term Care System (ALTCS). The program supports Arizonans who are elderly and/or have a physical disability (E/PD) with physical and behavioral healthcare, as well as provides pharmacy benefits and home and community-based services. A prolonged bid protest continues to be litigated and, at this time, it is unclear when the contract could be implemented.

In addition, we are in the process of protesting the results of Medicaid procurement awards in Georgia and Texas. If these protests are not successful, our future results of operations would be impacted.

Medicare / Dual-Eligible

•In March 2025, our subsidiary, Meridian Health Plan of Illinois, Inc., was selected by the Illinois Department of Healthcare and Family Services to continue providing Medicare and Medicaid services for dually eligible Illinoisans through a Fully Integrated Dual Eligible Special Needs Plan (FIDE SNP). The contract is expected to begin in January 2026 and has a four-year term, with optional extensions of six months to five and a half years.

•In November 2024, our subsidiary, Buckeye Health Plan, was selected by the Ohio Department of Medicaid to continue providing Medicare and Medicaid services for dually eligible individuals through a FIDE SNP. The three-year contract is expected to begin in January 2026.

•In October 2024, our subsidiary, Meridian Health Plan of Michigan, Inc., was selected by the MDHHS to provide highly integrated Medicare and Medicaid services for dually eligible Michiganders through a Highly Integrated Dual Eligible Special Needs Plan (HIDE SNP). The plan is expected to begin in January 2026 and has a seven-year term, with three optional one-year extensions, for a total of 10 possible contract years.

•In October 2024, CMS issued 2025 Medicare Advantage Star Ratings on the Medicare Plan Finder. Based on the data as well as our successful appeal of the initial scoring of our TTY (Text-to-Voice teletypewriter services for the hearing impaired), we had approximately 55% of our Medicare Advantage membership enrolled in plans rated 3.5 stars or higher – compared to approximately 23% in the prior year. This represents meaningful progress despite higher than industry-anticipated cut point changes.

Commercial

•In July 2025, we commenced the process of refiling 2026 policy year rates to reflect a higher projected baseline of Marketplace morbidity than previously expected. We currently expect to be able to take corrective pricing actions for 2026 in states representing a substantial majority of our Marketplace membership.

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MEMBERSHIP

From June 30, 2024 to June 30, 2025, our managed care membership decreased by 473 thousand, or (2)%. The following table sets forth our membership by line of business:


		June 30, 2025	December 31, 2024	June 30, 2024
Traditional Medicaid (1)		11,227,400	11,408,100	11,640,900
High Acuity Medicaid (2)		1,592,300	1,595,400	1,499,000
Total Medicaid		12,819,700	13,003,500	13,139,900
Marketplace		5,862,800	4,382,100	4,401,300
Individual and Commercial Group (3)		449,700	431,400	426,400
Total Commercial		6,312,500	4,813,500	4,827,700
Medicare (4)		1,026,900	1,110,900	1,138,400
Medicare PDP		7,845,800	6,925,700	6,603,600
Total at-risk membership		28,004,900	25,853,600	25,709,600
TRICARE eligibles		—	2,747,000	2,768,000
Total		28,004,900	28,600,600	28,477,600

(1)	Membership includes Temporary Assistance for Needy Families (TANF), Medicaid Expansion, Children's Health Insurance Program (CHIP), Foster Care, and Behavioral Health.
(2)	Membership includes Aged, Blind, or Disabled (ABD), Intellectual and Developmental Disabilities (IDD), Long-Term Services and Supports (LTSS) and Medicare-Medicaid Plans (MMP) Duals.
(3)	Membership includes Commercial Group, Individual Coverage Health Reimbursement Arrangement (ICHRA) and Other Off-Exchange Individual.
(4)	Membership includes Medicare Advantage and Medicare Supplement.

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RESULTS OF OPERATIONS

The following discussion and analysis is based on our Consolidated Statements of Operations, which reflect our results of operations for the three and six months ended June 30, 2025 and 2024, prepared in accordance with generally accepted accounting principles in the United States (GAAP).

Summarized comparative financial data for the three and six months ended June 30, 2025 and 2024 is as follows ($ in millions, except per share data in dollars):


	Three Months Ended June 30,						Six Months Ended June 30,
	2025		2024		% Change		2025		2024		% Change
Premium	$	41,740	$	35,140	19	%	$	83,452	$	70,669	18	%
Service	727		833		(13)	%	1,504		1,641		(8)	%
Premium and service revenues	42,467		35,973		18	%	84,956		72,310		17	%
Premium tax	6,275		3,863		62	%	10,406		7,933		31	%
Total revenues	48,742		39,836		22	%	95,362		80,243		19	%
Medical costs	38,808		30,765		26	%	75,311		61,697		22	%
Cost of services	641		680		(6)	%	1,339		1,349		(1)	%
Selling, general and administrative expenses	3,036		2,894		5	%	6,389		6,112		5	%
Depreciation expense	141		133		6	%	283		268		6	%
Amortization of acquired intangible assets	173		173		—	%	346		346		—	%
Premium tax expense	6,346		3,962		60	%	10,563		8,123		30	%
Impairment	55		—		n.m.		55		13		323	%

Earnings (loss) from operations	(458)		1,229		(137)	%	1,076		2,335		(54)	%
Investment and other income	371		463		(20)	%	753		1,008		(25)	%

Interest expense	(170)		(176)		3	%	(340)		(354)		4	%

Earnings (loss) before income tax	(257)		1,516		(117)	%	1,489		2,989		(50)	%
Income tax expense	2		370		(99)	%	434		685		(37)	%
Net earnings (loss)	(259)		1,146		(123)	%	1,055		2,304		(54)	%
Loss attributable to noncontrolling interests	6		—		n.m.		3		5		(40)	%
Net earnings (loss) attributable to Centene Corporation	$	(253)	$	1,146	(122)	%	$	1,058	$	2,309	(54)	%

Diluted earnings (loss) per common share attributable to Centene Corporation	$	(0.51)	$	2.16	(124)	%	$	2.13	$	4.32	(51)	%

n.m.: not meaningful

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Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024

Total Revenues

Total revenues increased 22% in the three months ended June 30, 2025, over the corresponding period in 2024, primarily driven by premium and membership growth in the PDP business along with overall market growth in the Marketplace business, rate increases in the Medicaid business and increased premium tax revenue, partially offset by lower Medicaid membership as a result of redeterminations and lower Marketplace net risk adjustment revenue. The three months ended June 30, 2024, benefited from outperformance in Marketplace risk adjustment for the 2023 benefit year.

Operating Expenses

Medical Costs/HBR

The HBR for the three months ended June 30, 2025, was 93.0%, compared to 87.6% in the same period in 2024. The increase was primarily driven by a reduction in our net 2025 Marketplace risk adjustment revenue transfer estimate, increased Marketplace medical costs, higher medical costs in Medicaid driven primarily by behavioral health, home health and high-cost drugs, and an increase to the 2025 Medicare Advantage premium deficiency reserve based on the progression of earnings during the year (with higher earnings at the beginning of the year and lower at the end of the year, given cost sharing progression).

Cost of Services

Cost of services decreased by $39 million in the three months ended June 30, 2025, compared to the corresponding period in 2024. The cost of service ratio for the three months ended June 30, 2025, was 88.2%, compared to 81.6% in the same period in 2024.

Selling, General & Administrative Expenses

The SG&A expense ratio was 7.1% for the second quarter of 2025, compared to 8.0% in the second quarter of 2024. The adjusted SG&A expense ratio was 7.1% for the second quarter of 2025, compared to 8.0% in the second quarter of 2024. The decreases were primarily driven by continued leveraging of expenses over higher revenues and growth in the PDP business. The decreases were partially offset by growth in the Marketplace business, which operates at a meaningfully higher SG&A expense ratio as compared to the overall company.

Impairment

During the three months ended June 30, 2025, we recorded total impairment charges of $55 million, driven by an intangible asset impairment related to the wind-down of certain contracts in the Other segment.

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Other Income (Expense)

The following table summarizes the components of other income (expense) for the three months ended June 30, ($ in millions):


	2025		2024
Investment and other income	$	371	$	463

Interest expense	(170)		(176)
Other income (expense), net	$	201	$	287

Investment and other income. Investment and other income decreased by $92 million in the three months ended June 30, 2025, compared to the corresponding period in 2024 driven primarily by lower interest rates and lower average investment balances during the quarter.

Interest expense. Interest expense decreased by $6 million in the three months ended June 30, 2025, compared to the corresponding period in 2024.

Income Tax Expense

The income tax expense recorded in the second quarter of 2025 reflects the year-to-date impact of a lower estimated full year 2025 effective tax rate.

For the three months ended June 30, 2024, we recorded income tax expense of $370 million on pre-tax earnings of $1.5 billion, or an effective tax rate of 24.4%. The effective tax rate for the second quarter of 2024 reflects the tax effects of settlements with taxing authorities. For the second quarter of 2024, our effective tax rate on adjusted earnings was 24.4%.

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Segment Results

The following table summarizes our consolidated operating results by segment for the three months ended June 30, ($ in millions):


		2025		2024		% Change
Total Revenues
Medicaid		$	27,998	$	24,113	16	%
Medicare		9,450		5,978		58	%
Commercial		10,070		8,535		18	%
Other		1,224		1,210		1	%
Consolidated total		$	48,742	$	39,836	22	%
Gross Margin (1)
Medicaid		$	1,117	$	1,461	(24)	%
Medicare		863		645		34	%
Commercial		946		2,267		(58)	%
Other		92		155		(41)	%
Consolidated total		$	3,018	$	4,528	(33)	%

(1)	Gross margin represents premium and service revenues less medical costs and cost of services.

Medicaid

Total revenues increased 16% in the three months ended June 30, 2025, compared to the corresponding period in 2024. The increase in total revenues was primarily driven by rate increases, partially offset by lower membership, primarily due to redeterminations. Gross margin decreased $344 million in the three months ended June 30, 2025, compared to the corresponding period in 2024. Gross margin decreased due to higher medical costs driven primarily by behavioral health, home health and high-cost drugs.

Medicare

Total revenues increased 58% in the three months ended June 30, 2025, compared to the corresponding period in 2024 primarily driven by increased PDP premium and membership, partially offset by lower Medicare Advantage membership. Gross margin increased $218 million in the three months ended June 30, 2025, compared to the corresponding period in 2024, primarily driven by premium and membership growth in the PDP business, including changes from the IRA impacting the quarterly progression of medical costs, partially offset by an increase to the 2025 premium deficiency reserve based on the progression of earnings during the year (with higher earnings at the beginning of the year and lower at the end of the year, given cost sharing progression).

Commercial

Total revenues increased 18% in the three months ended June 30, 2025, compared to the corresponding period in 2024 primarily driven by 33% membership growth in the Marketplace business, partially offset by lower Marketplace net risk adjustment revenue. Gross margin decreased $1.3 billion in the three months ended June 30, 2025, compared to the corresponding period in 2024 due to a reduction in our net 2025 Marketplace risk adjustment transfer estimate and increased Marketplace medical costs. The three months ended June 30, 2024, benefited from outperformance in Marketplace risk adjustment for the 2023 benefit year.

Other

Total revenues increased 1% in the three months ended June 30, 2025, compared to the corresponding period in 2024. Gross margin decreased $63 million in the three months ended June 30, 2025, compared to the corresponding period in 2024 driven by the expiration of the TRICARE Managed Care Support Contract in December 2024.

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Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024

Total Revenues

Total revenues increased 19% in the six months ended June 30, 2025, over the corresponding period in 2024, primarily driven by premium and membership growth in the PDP business along with overall market growth in the Marketplace business, rate increases in the Medicaid business and increased premium tax revenue, partially offset by lower Medicaid membership as a result of redeterminations and lower Marketplace net risk adjustment revenue. The six months ended June 30, 2024, benefited from outperformance in Marketplace risk adjustment for the 2023 benefit year.

Operating Expenses

Medical Costs/HBR

The HBR for the six months ended June 30, 2025, was 90.2%, compared to 87.3% in the same period in 2024. The increase was primarily driven by a reduction in our net 2025 Marketplace risk adjustment revenue transfer estimate, increased Marketplace medical costs late in the second quarter of 2025, higher medical costs in Medicaid driven primarily by behavioral health, home health and high-cost drugs, and an increase to the 2025 Medicare Advantage premium deficiency reserve based on the progression of earnings during the year (with higher earnings at the beginning of the year and lower at the end of the year, given cost sharing progression). The increase in HBR was partially offset by a decrease in Medicare due to program changes in the Part D business as a result of the IRA compared to the second quarter of 2024 and the resulting change in the quarterly progression of the Medicare segment HBR.

Cost of Services

Cost of services decreased by $10 million in the six months ended June 30, 2025, compared to the corresponding period in 2024. The cost of service ratio for the six months ended June 30, 2025, was 89.0%, compared to 82.2% in the same period in 2024.

Selling, General & Administrative Expenses

The SG&A expense ratio for the six months ended June 30, 2025, was 7.5%, compared to 8.5% for the corresponding period in 2024. The adjusted SG&A expense ratio for the six months ended June 30, 2025, was 7.5%, compared to 8.3% for the six months ended June 30, 2024. The decreases were primarily driven by continued leveraging of expenses over higher revenues and growth in the PDP business. The decreases were partially offset by growth in the Marketplace business, which operates at a meaningfully higher SG&A expense ratio as compared to the overall company.

Impairment

During the six months ended June 30, 2025, we recorded total impairment charges of $55 million, driven by an intangible asset impairment related to the wind-down of certain contracts in the Other segment.

During the six months ended June 30, 2024, we recorded total impairment charges of $13 million, driven by Health Net Federal Services property, software and equipment related to the TRICARE Managed Care Support Contract that was no longer recoverable following the 2024 final ruling.

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Other Income (Expense)

The following table summarizes the components of other income (expense) for the six months ended June 30, ($ in millions):


	2025		2024
Investment and other income	$	753	$	1,008

Interest expense	(340)		(354)
Other income (expense), net	$	413	$	654

Investment and other income. Investment and other income decreased by $255 million in the six months ended June 30, 2025, compared to the corresponding period in 2024. The six months ended June 30, 2024, included net gains on divestitures. The decrease was also driven by lower interest rates and lower average investment balances during 2025.

Interest expense. Interest expense decreased by $14 million in the six months ended June 30, 2025, compared to the corresponding period in 2024.

Income Tax Expense

For the six months ended June 30, 2025, we recorded income tax expense of $434 million on pre-tax earnings of $1.5 billion, or an effective tax rate of 29.1%. For the six months ended June 30, 2025, our effective tax rate on adjusted earnings was 28.1%.

For the six months ended June 30, 2024, we recorded income tax expense of $685 million on pre-tax earnings of $3.0 billion, or an effective tax rate of 22.9%. The effective tax rate for 2024 reflects the tax effects of the Circle Health divestiture. For the six months ended June 30, 2024, our effective tax rate on adjusted earnings was 24.5%.

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Segment Results

The following table summarizes our consolidated operating results by segment for the six months ended June 30, ($ in millions):


		2025		2024		% Change
Total Revenues
Medicaid		$	54,428	$	49,643	10	%
Medicare		18,209		11,913		53	%
Commercial		20,219		16,286		24	%
Other		2,506		2,401		4	%
Consolidated total		$	95,362	$	80,243	19	%
Gross Margin (1)
Medicaid		$	2,549	$	3,405	(25)	%
Medicare		2,067		1,191		74	%
Commercial		3,488		4,338		(20)	%
Other		202		330		(39)	%
Consolidated total		$	8,306	$	9,264	(10)	%

(1)	Gross margin represents premium and service revenues less medical costs and cost of services.

Medicaid

Total revenues increased 10% in the six months ended June 30, 2025, compared to the corresponding period in 2024. The increase in total revenues was primarily driven by rate increases, partially offset by lower membership, primarily due to redeterminations. Gross margin decreased $856 million in the six months ended June 30, 2025, compared to the corresponding period in 2024. Gross margin decreased due to higher medical costs driven primarily by behavioral health, home health and high-cost drugs.

Medicare

Total revenues increased 53% in the six months ended June 30, 2025, compared to the corresponding period in 2024, primarily driven by increased PDP membership of 19%, partially offset by lower Medicare Advantage membership. Gross margin increased $876 million in the six months ended June 30, 2025, compared to the corresponding period in 2024 driven primarily by premium and membership growth in the PDP business, including changes from the IRA impacting the quarterly progression of medical costs, partially offset by an increase to the 2025 premium deficiency reserve based on the progression of earnings during the year (with higher earnings at the beginning of the year and lower at the end of the year, given cost sharing progression).

Commercial

Total revenues increased 24% in the six months ended June 30, 2025, compared to the corresponding period in 2024 primarily driven by 33% membership growth in the Marketplace business, partially offset by lower Marketplace net risk adjustment revenue. Gross margin decreased $850 million in the six months ended June 30, 2025, compared to the corresponding period in 2024 due to a reduction in our net 2025 Marketplace risk adjustment transfer estimate and increased Marketplace medical costs late in the second quarter of 2025. The six months ended June 30, 2024, benefited from outperformance in Marketplace risk adjustment for the 2023 benefit year.

Other

Total revenues increased 4% in the six months ended June 30, 2025, compared to the corresponding period in 2024. Gross margin decreased $128 million in the six months ended June 30, 2025, compared to the corresponding period in 2024 driven by the Circle Health divestiture in the first quarter of 2024 along with the expiration of the TRICARE Managed Care Support Contract in December 2024.

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LIQUIDITY AND CAPITAL RESOURCES

Shown below is a condensed schedule of cash flows used in the discussion of liquidity and capital resources ($ in millions).


	Six Months Ended June 30,
	2025		2024
Net cash provided by operating activities	$	3,295	$	1,719
Net cash (used in) investing activities	(1,428)		(315)
Net cash (used in) financing activities	(1,424)		(1,148)
Effect of exchange rate changes on cash and cash equivalents	—		7
Net increase in cash, cash equivalents and restricted cash and cash equivalents	$	443	$	263

Cash Flows Provided by Operating Activities

Normal operations are funded primarily through operating cash flows and borrowings under our Revolving Credit Facility. Operating activities provided cash of $3.3 billion in the six months ended June 30, 2025, compared to providing cash of $1.7 billion in the comparable period in 2024.

Cash flows provided by operations in 2025 were primarily driven by net earnings and improved pharmacy rebate remittance timing. Cash flows provided in operations in 2024 were driven by net earnings, partially offset by pharmacy remittance timing as we transitioned to the new third-party PBM, which commenced in January 2024.

Cash Flows (Used in) Investing Activities

Investing activities used cash of $1.4 billion in the six months ended June 30, 2025, compared to using cash of $315 million in the comparable period in 2024. Cash flows used in investing activities in the second quarter of 2025 were driven primarily by net additions to the investment portfolio of our regulated subsidiaries (including transfers from cash and cash equivalents to long-term investments) and capital expenditures. Cash flows used in investing activities in the second quarter of 2024 were primarily driven by net additions to the investment portfolio of our regulated subsidiaries (including transfers from cash and cash equivalents to long-term investments) and capital expenditures, partially offset by divestiture proceeds.

We spent $343 million and $337 million in the six months ended June 30, 2025 and 2024, respectively, on capital expenditures, the majority of which was driven by system enhancements and computer hardware.

As of June 30, 2025, our investment portfolio consisted primarily of fixed-income securities with an average duration of 3.4 years. At June 30, 2025, we had unregulated cash and investments of $1.1 billion, including $234 million of cash and cash equivalents and $852 million of investments. Unregulated cash and investments at December 31, 2024, was $1.1 billion, including $248 million of cash and cash equivalents and $823 million of investments.

Cash Flows (Used in) Financing Activities

Financing activities used cash of $1.4 billion in the six months ended June 30, 2025, compared to using cash of $1.1 billion in the comparable period in 2024. Financing activities in 2025 were driven by net decreases in debt of $969 million and stock repurchases of $473 million, which included $400 million under the stock repurchase program and $41 million of repurchases related to income tax withholding upon the vesting of previously awarded stock grants.

Financing activities in 2024 were driven by stock repurchases of $954 million, partially offset by net increases in debt of $215 million.

Liquidity Metrics

We have a stock repurchase program authorizing us to repurchase common stock from time to time on the open market or through privately negotiated transactions. In 2023, the Company's Board of Directors authorized up to a cumulative total of $10.0 billion of repurchases under the program.

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During the second quarter of 2025, we repurchased 6.7 million shares of common stock for $400 million under the stock repurchase program. We have $1.8 billion available under the program for repurchases as of June 30, 2025. No duration has been placed on the repurchase program. We reserve the right to discontinue the repurchase program at any time. Refer to Note 7. Stockholders' Equity for further information on stock repurchases.

As of June 30, 2025, we had an aggregate principal amount of $15.7 billion of senior notes issued and outstanding. The indentures governing our various maturities of senior notes contain restrictive covenants. As of June 30, 2025, we were in compliance with all covenants.

As part of our capital allocation strategy, we may decide to repurchase debt or raise capital through the issuance of debt. In 2022, the Company's Board of Directors also authorized a $1.0 billion senior note debt repurchase program. No repurchases were made during the quarter ended June 30, 2025. As of June 30, 2025, there was $700 million available under the senior note debt repurchase program.

The credit agreement underlying our Revolving Credit Facility, in the principal amount of $4.0 billion, and Term Loan Facility, in the principal amount of $2.0 billion, contains customary covenants as well as financial covenants including a debt-to-capital ratio. Our maximum debt-to-capital ratio under the credit agreement may not exceed 0.60 to 1.00. As of June 30, 2025, we had no borrowing outstanding under our Revolving Credit Facility, $2.0 billion of borrowings under our Term Loan Facility, and we were in compliance with all covenants. As of June 30, 2025, there were no limitations on the availability of our Revolving Credit Facility as a result of the debt-to-capital ratio.

We had outstanding letters of credit of $141 million as of June 30, 2025, which were not part of our Revolving Credit Facility. The letters of credit bore weighted interest of 0.7% as of June 30, 2025. In addition, we had outstanding surety bonds of $783 million as of June 30, 2025.

At June 30, 2025, our debt-to-capital ratio, defined as total debt divided by the sum of total debt and total equity, was 39.0%, compared to 41.2% at December 31, 2024. The debt-to-capital ratio decrease was driven by a decrease on the Revolving Credit Facility as well as net earnings for 2025, which increased total stockholders' equity. We utilize the debt-to-capital ratio as a measure, among others, of our leverage and financial flexibility.

At June 30, 2025, we had working capital, defined as current assets less current liabilities, of $3.6 billion, compared to $3.7 billion at December 31, 2024. We manage our short-term and long-term investments aiming to ensure a sufficient portion of the portfolio is highly liquid and can be sold to fund short-term requirements as needed.

2025 Expectations

During the remainder of 2025, we expect a net contribution of approximately $300 million to our insurance subsidiaries and to spend approximately $350 million in additional capital expenditures.

Based on our operating plan, we expect that our available cash, cash equivalents and investments, cash from our operations and cash available under our Revolving Credit Facility will be sufficient to finance our general operations and capital expenditures for at least 12 months from the date of this filing. While we are currently in a strong liquidity position and believe we have adequate access to capital, we may elect to increase borrowings on our Revolving Credit Facility, which matures in March 2030. Additionally, our senior notes mature between December 2027 and August 2031. From time to time, we may elect to raise additional funds for working capital and other purposes, either through issuance of debt or equity, the sale of investment securities or otherwise, as appropriate. In addition, we may strategically pursue refinancing or redemption opportunities to extend maturities and/or improve terms of our indebtedness if we believe such opportunities are favorable to us.

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REGULATORY CAPITAL AND DIVIDEND RESTRICTIONS

Our operations are conducted through our subsidiaries. As managed care organizations, most of our subsidiaries are subject to state regulations and other requirements that, among other things, require the maintenance of minimum levels of statutory capital, as defined by each state, and restrict the timing, payment and amount of dividends and other distributions that may be paid to us. Generally, the amount of dividend distributions that may be paid by a regulated subsidiary without prior approval by state regulatory authorities is limited based on the entity's level of statutory net income and statutory capital and surplus.

Our regulated subsidiaries are required to maintain minimum capital requirements prescribed by various regulatory authorities in each of the states in which we operate. During the six months ended June 30, 2025, we received dividends of $1.7 billion from and made $908 million of capital contributions to our regulated subsidiaries. For our subsidiaries that file with the National Association of Insurance Commissioners (NAIC), the aggregate risk-based capital (RBC) level as of December 31, 2024, which was the most recent date for which reporting was required, was in excess of 350% of the Authorized Control Level. We expect to continue to maintain an aggregate RBC level in excess of 350% of the Authorized Control Level during 2025.

Under the California Knox-Keene Health Care Service Plan Act of 1975, as amended (Knox-Keene), certain of our California subsidiaries must comply with tangible net equity (TNE) requirements. Under these Knox-Keene TNE requirements, actual net worth less certain unsecured receivables and intangible assets must be more than the greater of (i) a fixed minimum amount, (ii) a minimum amount based on premiums or (iii) a minimum amount based on healthcare expenditures, excluding capitated amounts.

Under the New York State Department of Health Codes, Rules and Regulations Title 10, Part 98, our New York subsidiary must comply with contingent reserve requirements. Under these requirements, net worth based upon admitted assets must equal or exceed a minimum amount based on annual net premium income.

The NAIC has adopted rules which set minimum RBC requirements for insurance companies, managed care organizations and other entities bearing risk for healthcare coverage. As of June 30, 2025, each of our health plans was in compliance with the RBC requirements enacted in those states.

As a result of the above requirements and other regulatory requirements, certain of our subsidiaries are subject to restrictions on their ability to make dividend payments, loans or other transfers of cash to their parent companies. Such restrictions, unless amended or waived or unless regulatory approval is granted, limit the use of any cash generated by these subsidiaries to pay our obligations. The maximum amount of dividends that can be paid by our insurance company subsidiaries without prior approval of the applicable state insurance departments is subject to restrictions relating to statutory surplus, statutory income and unassigned surplus.

CRITICAL ACCOUNTING ESTIMATES

Please see "Critical Accounting Estimates in Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our 2024 Annual Report on Form 10-K for a description of our Critical Accounting Estimates in addition to the discussion outlined within Note 11. Subsequent Events, in the Notes to the Consolidated Financial Statements, included herein.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk.

INVESTMENTS AND DEBT

As of June 30, 2025, we had short-term investments of $2.8 billion and long-term investments of $20.2 billion, including restricted deposits of $1.4 billion. The short-term investments generally consist of highly liquid securities with maturities between three and 12 months. The long-term investments consist of municipal, corporate and U.S. Treasury securities, government-sponsored obligations, life insurance contracts, asset-backed securities, and equity securities, and have maturities greater than one year. Restricted deposits consist of investments required by various state statutes to be deposited or pledged to state agencies. Due to the nature of the states' requirements, these investments are classified as long-term regardless of the contractual maturity date. Substantially all of our investments are subject to interest rate risk and will decrease in value if market rates increase. Assuming a hypothetical and immediate 1% increase in market interest rates at June 30, 2025, the fair value of our fixed income investments would decrease by approximately $728 million.

For a discussion of the interest rate risk that our investments are subject to, refer to our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, Part 1, Item 1A, "Risk Factors – Our investment portfolio may suffer losses which could materially and adversely affect our results of operations or liquidity."

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures - We maintain disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the Exchange Act) that are designed to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC rules and forms; and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

In connection with the filing of this Form 10-Q, management evaluated, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2025. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of June 30, 2025.

Changes in Internal Control Over Financial Reporting - No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the quarter ended June 30, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II

OTHER INFORMATION

Item 1. Legal Proceedings.

A description of the legal proceedings to which the Company and its subsidiaries are a party is contained in Note 10. Contingencies to the consolidated financial statements included in Part I of this Quarterly Report on Form 10-Q, and is incorporated herein by reference.

Item 1A. Risk Factors.

The following risk factors supplement the risk factors described in Item 1A of our 2024 Annual Report on Form 10-K and Part II, Item 1A of our first quarter 2025 Form 10-Q, which are hereby incorporated by reference, and should be read in conjunction with the risk factors described in our 2024 Annual Report on Form 10-K and first quarter 2025 Form 10-Q.

Failure to accurately estimate and price our medical expenses or effectively manage our medical costs or related administrative costs could have a material adverse effect on our results of operations, financial condition and cash flows.

Our profitability depends to a significant degree on our ability to accurately estimate and effectively manage expenses related to health benefits through, among other things, our ability to contract favorably with hospitals, physicians and other healthcare providers. For example, our government-sponsored health programs revenue is often based on bids submitted before the start of the initial contract year. If our actual medical expenses exceed our estimates, our health benefits ratio (HBR), or our expenses related to medical services as a percentage of premium revenues, would increase and our profits would decline. For example, during the second quarter of 2025, data from an independent actuarial firm suggested a materially higher implied aggregate morbidity of the Marketplace membership as a whole, resulting in a significant reduction of our expected net risk adjustment revenue for 2025. In addition, during the second quarter of 2025, our Medicaid membership had higher than expected medical costs, including due to increased costs in behavioral health, home health and high-cost drugs. Because of the narrow margins of our health plan business, relatively small changes in our HBR can create significant changes in our financial results. Changes in healthcare regulations and practices, the level of utilization of healthcare services, including due to provider or consumer behavior and sentiment, out-of-network utilization and pricing, medical claim submission patterns, hospital and pharmaceutical costs, including new high-cost specialty drugs, unexpected events, such as natural disasters, the effects of climate change, acts of war or aggression, geopolitical instability, major epidemics, pandemics and their resurgence, or newly emergent diseases, new medical technologies, increases in provider fraud, tariffs and other external factors, including general economic conditions such as interest rates, inflation and unemployment levels, are generally beyond our control and could reduce our ability to accurately predict and effectively control the costs of providing health benefits. Also, member and provider behavior could continue to be influenced by the uncertainty surrounding the availability, affordability, funding and access to health insurance, whether under Medicaid programs or the Affordable Cares Act (ACA), including potential changes in premium subsidies, including due to changes in the eligibility or amount of enhanced Advance Premium Tax Credits (APTCs) for Marketplace products or as otherwise affected by the One Big Beautiful Bill Act (OBBBA).

In addition, as a result of the expiration of the public health emergency (PHE) due to the COVID-19 pandemic, and the resulting Medicaid redeterminations process, we have experienced a higher HBR related to the remaining members, due to the acuity profile of this membership, as well as the gaps in eligibility for certain members who have rejoined the Medicaid plans. While we continue to work with our state partners to match rates to acuity post-redeterminations, such rate adjustments may be delayed or insufficient to offset the increased acuity.

Our medical expenses include claims reported but not paid, estimates for claims incurred but not reported, and estimates for the costs necessary to process unpaid claims at the end of each period. Our development of the medical claims liability estimate is a continuous process that we monitor and refine on a monthly basis as claims receipts and payment information as well as inpatient acuity information becomes available. As more complete information becomes available, we adjust the amount of the estimate, and include the changes in estimates in medical expenses in the period in which the changes are identified. Given the extensive judgment and uncertainties inherent in such estimates, there can be no assurance that our medical claims liability estimate will be accurate, and any adjustments to the estimate may unfavorably impact our results of operations and financial condition and may be material.

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Assumptions and estimates are utilized in establishing premium deficiency reserves. For example, we established a premium deficiency reserve in connection with the 2025 Medicare Advantage business as of December 31, 2024, which is updated quarterly based on the progression of earnings during the year. If our assumptions are inaccurate, we may be required to increase our premium deficiency reserves which could have a material adverse effect on our results of operations and financial condition.

Additionally, when we commence operations in a new state or region or launch a new product, we have limited information with which to estimate our medical claims liability and continuity of care requirements. For a period of time after the inception of the new business, we base our estimates on government-provided historical actuarial data and limited actual incurred and received claims and inpatient acuity information. In addition, we have limited ability to manage the utilization of services until continuity of care requirements expire. The addition of new categories of eligible individuals, as well as evolving Health Insurance Marketplace plans, may pose difficulty in estimating our medical claims liability.

From time to time in the past, our actual results have varied from our estimates, particularly in times of significant changes in the number of our members. If it is determined that our estimates are significantly different than actual results, our results of operations and financial condition could be materially adversely affected. In addition, if there is a significant delay in our receipt of premiums, our business operations, cash flows or earnings could be negatively impacted.

Any failure to adequately price or anticipate demand for products offered, anticipate changes to the competitive landscape or any reduction in products offered for Medicare and in the Health Insurance Marketplace may have a material adverse effect on our results of operations, financial condition and cash flows.

In the Health Insurance Marketplace, we may be adversely impacted if we have not accurately predicted the health needs of our members, including individuals exiting or entering the market, causing the morbidity of the risk pool to rise without a proportionate change to risk adjustment. In addition, the risk adjustment provisions of the ACA established to apportion risk amongst insurers may not be effective in appropriately mitigating the financial risks related to the Health Insurance Marketplace product, are affected by our members' acuity relative to the membership acuity of other insurers and are subject to a high degree of estimation and variability, including estimation of the ultimate level of program funding based on the financial performance of other insurers. For example, late in the second quarter of 2025, we experienced increased Marketplace medical costs and our first view of market data indicated overall higher morbidity across the market, which resulted in a significant negative adjustment to our expected net risk adjustment revenue attributable to the 2025 Marketplace plan year. Further, changes in the competitive market for both Health Insurance Marketplace and the Medicare products over time, changes to member eligibility in the program design, including due to changes to the eligibility or amount of the enhanced APTCs and the timing of those changes, additional program integrity initiatives that have the effect of reducing membership or causing the morbidity of the risk pool to rise, changes in consumer or provider behavior, or changes in the financial incentives of individuals, brokers and competitors to participate in such products may make pricing difficult to predict. For example, competitors may introduce pricing, broker incentives or broker distribution channels that we may not be able to match, which may adversely affect our ability to compete effectively. Competitors may also choose to exit the market altogether or otherwise suffer financial difficulty, which could adversely impact the pool of potential insured, affect collectability of risk adjustment payable or require us to increase premium rates. Any significant variation from our expectations regarding acuity of our members, the Marketplace membership as a whole, enrollment levels, adverse selection, out-of-network costs or other increased costs, including due to tariffs or other assumptions utilized in setting adequate premium rates could have a material adverse effect on our results of operations, financial condition and cash flows for both our Health Insurance Marketplace and Medicare products.

In addition, we may be unable to accurately predict demand for both our Health Insurance Marketplace and Medicare products, as demand depends on factors outside of our control such as the competitiveness of our bids, the broker distribution channels, additional program integrity initiatives that have the effect of reducing membership and the entry and exit of other competitors in the markets. If we experience higher demand for our products than anticipated, we may not have adequate staffing to be able to adequately meet service level requirements in our call centers, which could negatively impact our quality scores, our relationships with our members and providers, as well as our regulators.

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If eligibility for the enhanced advance premium tax credit for Marketplace members expires without renewal or the eligibility for tax credits is further modified or delayed, our results of operations, financial condition, and cash flows could be materially and adversely affected.

In August 2022, the U.S. federal government enacted the Inflation Reduction Act (IRA), which, among other things, extended eligibility for the enhanced APTC for Marketplace members. This enhanced credit expires on December 31, 2025, and if it is not renewed or extended, or if eligibility for this enhanced credit is further limited, or if such renewal or extension is further delayed, it could materially adversely impact our Marketplace membership. The OBBBA placed additional restrictions on APTC requirements. For example, beginning January 1, 2026, should individuals underestimate their projected income, the OBBBA requires them to reimburse the Internal Revenue Service (IRS) for the full amount of excess tax credit received. In addition, as of January 1, 2026, the OBBBA prohibits individuals from receiving APTCs if they enroll in health coverage through a Special Enrollment Period associated with their income. We anticipate that the combined effect of the expiration of the enhanced APTCs, the Marketplace Integrity & Affordability Final Rule (Final Rule) and the OBBBA will reduce 2026 Marketplace membership and continue to increase the overall morbidity of the Marketplace population. Submissions of the product design and pricing for the Marketplace product for the following calendar year is generally due to our state regulators in the summer. If additional modifications or renewal of the tax credits occur, we may not be able to price our products appropriately or be able to change our product pricing or strategy in response to such modifications, which could further materially adversely impact our Marketplace membership, financial condition and cash flows.

Reductions or delays in funding of, changes to eligibility requirements for government-sponsored healthcare programs in which we participate, and any inability on our part to effectively adapt to changes to these programs could have a material adverse effect on our results of operations, financial condition and cash flows.

The majority of our revenues come from government subsidized healthcare programs including Medicaid, Medicare, Children's Health Insurance Program (CHIP), Long-Term Care Services and Support (LTSS), Aged, Blind, or Disabled (ABD), Foster Care and Health Insurance Marketplace premiums. Changes in these programs, including due to executive orders or other regulatory actions from the current political administration, could change the number of persons enrolled in or eligible for these programs, reduce funding, delay funding and increase our administrative and healthcare costs under these programs. For example, due to the declaration of the end of the PHE and the subsequent expiration of the eligibility determination waivers, the resumption of the Medicaid eligibility redeterminations significantly reduced our membership in our Medicaid programs, and we did not fully offset the loss of this membership by increased enrollment in our Health Insurance Marketplace products. In addition, as a result of the expiration of the PHE due to the COVID-19 pandemic, and the resulting Medicaid redeterminations process, we have experienced a higher HBR related to the remaining members, due to the acuity profile of this membership, as well as the gaps in eligibility for certain members who have rejoined the Medicaid plans. While we continue to work with our state partners to match rates to acuity post-redeterminations, such rate adjustments may be delayed or insufficient to offset the increased acuity. In some cases, states may decide to reduce reimbursement or reduce benefits. If any state in which we operate were to decrease premiums paid to us or pay us less than the amount necessary to keep pace with our cost trends, it could have a material adverse effect on our results of operations, financial condition and cash flows.

The Final Rule was published in the Federal Register on June 25, 2025. The Final Rule makes changes to policies to strengthen program integrity measures in the Marketplace. For example, the Special Enrollment Period for those under 150% of the Federal Poverty Level (FPL) has been repealed beginning August 25, 2025. Further, beginning in plan year 2026, consumers who automatically re-enroll into a fully subsidized Marketplace plan will be re-enrolled into the same plan with a $5 premium until the consumer updates their exchange application to confirm APTC eligibility. In addition, exchanges may no longer accept a consumer's self-attestation of projected annual household income when the IRS cannot verify it due to lack of tax return data; rather, exchanges must verify household income using other trusted data sources.

In July 2025, the OBBBA placed additional restrictions on APTC requirements. For example, beginning January 1, 2026, should individuals underestimate their projected income, the OBBBA requires them to reimburse the IRS for the full amount of excess tax credit received. In addition, as of January 1, 2026, the OBBBA prohibits individuals from receiving APTCs if they enroll in health coverage through a Special Enrollment Period associated with their income. We anticipate that the combined effect of the expiration of the enhanced APTCs, the Final Rule, and the OBBBA will reduce 2026 Marketplace membership and continue to increase the overall morbidity of the Marketplace population.

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Payments from government payors may be delayed in the future, which, if extended for any significant period of time, could have a material adverse effect on our results of operations, financial condition, cash flows or liquidity. For example, we have a receivable due to us from the Centers for Medicare and Medicaid Services (CMS) for Part D risk-sharing programs attributable to the 2024 and 2025 plan years that we expect to be paid by CMS approximately 12 to 13 months after the plan year closes. If the payments from CMS are delayed, our cash flows may be materially adversely affected. In addition, delays in obtaining, or failure to obtain or maintain, governmental approvals, or moratoria imposed by regulatory authorities, could adversely affect our revenues or membership, increase costs or adversely affect our ability to bring new products to market as forecasted. Other changes to our government programs could affect our willingness or ability to participate in any of these programs or otherwise have a material adverse effect on our business, financial condition or results of operations.

Under most of these programs, the base premium rate paid for each program differs, depending on a combination of factors such as defined upper payment limits, a member's health status, age, gender, county or region and benefit mix. Since Medicaid was created in 1965, the federal government and states have shared the costs for this program, with the federal government share currently averaging approximately 60%. We are therefore exposed to risks associated with federal and state government contracting or participating in programs involving a government payor, including but not limited to the general ability of the federal and/or state governments to terminate or modify contracts with them, in whole or in part, without prior notice, for convenience or for default based on performance; potential regulatory or legislative action that may materially modify amounts owed; our dependence upon Congressional or legislative appropriation and allotment of funds and the impact that delays in government payments could have on our operating cash flow and liquidity; responses to pandemics, resurgences and new emergent diseases and other regulatory, legislative or judicial actions that may have an impact on the operations of government subsidized healthcare programs, including ongoing litigation involving the ACA.

Future levels of funding and premium rates may be affected by continuing government efforts to contain healthcare costs and may further be affected by state and federal budgetary constraints and spending initiatives or changes in control of the legislative or executive branches at the state and federal level. Governments periodically consider reducing or reallocating the amount of money they spend for Medicaid, Medicare, CHIP, LTSS, ABD and Foster Care. For example, the OBBBA included requirements that may reduce the number of members eligible for state Medicaid Expansion programs by requiring work or community engagement by members and for state Medicaid agencies to redetermine member eligibility at more frequent intervals, along with adding a "Cost Sharing" or "Co-Pay" for certain medical services. These changes could have the effect of increasing the overall morbidity of the Medicaid Expansion population as early as 2027. Several other provisions of the OBBBA, such as adjustments to provider taxes and state directed payments beginning in 2028, may have the effect of reducing the amount of federal funding for Medicaid, which could result in changes in the design of Medicaid programs, including coverage of benefits, eligibility, and/or provider payment rates.

Additionally, as a result of the CMS Medicare Advantage 2025 rate actions, combined with our quality scores, we established a premium deficiency reserve in connection with the 2025 Medicare Advantage business as of December 31, 2024, which is updated quarterly based on the progression of earnings during the year. Medicare remains subject to the automatic spending reductions imposed by the Budget Control Act of 2011 and the American Taxpayer Relief Act of 2012 (sequestration), subject to a 2% cap, which was extended by the Bipartisan Budget Act of 2019 through 2029, which was reinstated on July 1, 2022, after a temporary suspension due to the COVID pandemic. Additional changes to the funding or eligibility criteria for these programs could materially impact our membership, revenues, financial condition and cash flows.

The IRA enacted significant changes to the Medicare Part D program beginning on January 1, 2025. These changes created additional uncertainty for 2025 Medicare Part D bids, including their profitability and the competitive market landscape. If our future Part D premium bids are not profitable or below the CMS benchmarks or competitors price their products with significantly lower premiums, membership, revenue and profitability of this product could be materially reduced, which in turn could have a material adverse effect on our results of operations and financial conditions. Further, changes in the Medicare Part D program could impact membership and cause the timing of our cash flows to be impacted, which in turn could impact the timing and level of our interest expense.

In addition, new CMS regulations will require beneficiaries dually enrolled in Medicare and Medicaid to receive integrated care through Medicare Advantage Dual Eligible Special Needs Plans beginning in 2030, with restrictions beginning in 2027, which may restrict our product offerings in some geographic service areas.

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In addition, adverse economic conditions may put pressures on state budgets as tax and other state revenues decrease while the population that is eligible to participate in these programs remains steady or increases, creating more need for funding. We anticipate this will require government agencies to find funding alternatives, which may result in reductions or delays in funding for programs, contraction of covered benefits and limited or no premium rate increases or premium rate decreases. A reduction (or less than expected increase), a protracted delay or a change in allocation methodology in government funding for these programs, as well as termination of one or more contracts for the convenience of the government, may materially and adversely affect our results of operations, financial condition and cash flows.

Also, if legislation increasing the federal debt ceiling is not enacted and the debt ceiling is reached, the federal government may stop or delay making payments on its obligations. In addition, if another federal government shutdown were to occur for a prolonged period of time, federal government payment obligations, including its obligations under Medicaid, Medicare, TRICARE, CHIP, LTSS, ABD, Foster Care and the Health Insurance Marketplace, may be delayed. Similarly, if state government shutdowns were to occur, state payment obligations may be delayed. If the federal or state governments fail to make payments under these programs on a timely basis, our business could suffer, and our financial condition, results of operations or cash flows may be materially affected.

We derive a portion of our cash flow and gross margin from our prescription drug plan (PDP) operations, for which we submit annual bids for participation. The results of our bids could have a material adverse effect on our results of operations, financial condition and cash flows.

A significant portion of our PDP membership is obtained from the auto-assignment of beneficiaries in CMS-designated regions where our PDP premium bids are below benchmarks of other plans' bids. In general, our premium bids are based on assumptions regarding PDP membership, utilization, drug costs, drug rebates and other factors for each region. Our 2025 PDP bids resulted in 33 of the 34 CMS regions for which we were below the benchmarks and one region for which we were above the benchmark. As of June 30, 2025, we experienced an increase to over 7.8 million PDP members compared to 6.9 million in December 2024, due to our 2025 bid positioning. If our future Part D premium bids are not below the CMS benchmarks, we risk losing PDP members who were previously assigned to us and we may not have additional PDP members auto-assigned to us, which could materially reduce our revenue.

The IRA has substantially increased PDP's risk exposure in 2025. Under the IRA, PDP plan costs increased significantly due to a reduction in members' cost share (close of coverage gap, and the $2,000 cap on member out-of-pocket expenses) and a decrease in federal reinsurance (from 80% to 20%, while a greater portion of the plan drug costs will fall into the catastrophic phase). In the meantime, Part D risk sharing program thresholds have been applied to the increased Part D plan costs, so the plan cost at risk is much greater before any risk sharing kicks in. These changes have led and continue to lead to heightened underwriting risks and increased market volatility and uncertainty for 2025 bids, which could materially reduce our cash flows, revenue and profit. For example, we have a receivable due to us from CMS for Part D risk-sharing programs attributable to the 2024 and 2025 plan years that we expect to be paid by CMS approximately 12 to 13 months after the plan year closes. If the payments from CMS are delayed, our cash flows may be materially adversely affected. The IRA also offers Part D enrollees the option to defer payment of out-of-pocket prescription drug costs across monthly payments throughout the benefit year instead of to the pharmacy at the point of sale under the Medicare Prescription Payment Plan (M3P). This change may lead to increased bad debt exposure along with potential challenges with collecting deductibles and other cost-sharing amounts from beneficiaries. The change may also lead to estimation uncertainty as we develop our experience with the M3P. Due to the uncertainty of the new Part D pricing structure, Centene has elected into the Part D Premium Stabilization Demonstration program, which subsidizes member premiums and provides additional protection through the risk corridor in the event of unforeseen losses, but such election may not be sufficient to offset the uncertainty or risks relating to our experience with M3P as well as the increased risk exposure.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In November 2005, the Company's Board of Directors announced a stock repurchase program, which was most recently increased in December 2023. The Company is authorized to repurchase up to $10.0 billion, inclusive of past authorizations, of which $1.8 billion is available as of June 30, 2025.

The stock repurchase program is effected primarily through regular open-market purchases (which may include repurchase plans designed to comply with Rule 10b5-1 and accelerated share repurchases), the amounts and timing of which are subject to the Company's discretion as part of its capital allocation strategy, and may be based upon general market conditions and the prevailing price and trading volumes of its common stock. No duration has been placed on the repurchase program. The Company reserves the right to discontinue the repurchase program at any time.


Issuer Purchases of Equity Securities Second Quarter 2025 (Shares in thousands)
Period		Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs ($ in millions) (1)
April 1, 2025 - April 30, 2025		1,596	$	59.25	1,596	$	2,135
May 1, 2025 - May 31, 2025		5,117	59.69		5,117	1,830
June 1, 2025 - June 30, 2025		—	—		—	1,830
Total		6,713	$	59.59	6,713	$	1,830



(1)	A remaining amount of $1.8 billion is available under the stock repurchase program as of June 30, 2025.

Item 5. Other Information

(a) None.

(b) None.

(c) During the three months ended June 30, 2025, no director or officer of the Company adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of Regulation S-K.

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Item 6. Exhibits.


EXHIBIT NUMBER		DESCRIPTION









10.1	*	Non-Employee Director Compensation Policy

10.2	*	Form of Non-Employee Director Restricted Stock Unit Agreement #1

10.3	*	Centene Corporation Non-Employee Director Deferred Stock Compensation Plan.

31.1		Certification of Chief Executive Officer pursuant to Rule 13(a)-14(a) under the Securities Exchange Act of 1934, as amended.

31.2		Certification of Executive Vice President and Chief Financial Officer pursuant to Rule 13(a)-14(a) under the Securities Exchange Act of 1934, as amended.

32.1	#	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2	#	Certification of Executive Vice President and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		The following materials from the Centene Corporation Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, formatted in Inline Extensible Business Reporting Language (iXBRL): (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Operations; (iii) the Consolidated Statements of Comprehensive Earnings (Loss); (iv) the Consolidated Statements of Stockholders' Equity; (v) the Consolidated Statements of Cash Flows and (vi) related notes.

104		Cover Page Interactive Data File, formatted in iXBRL and contained in Exhibit 101.

* Indicates a management contract or compensatory plan or arrangement.
# This certification is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized as of July 25, 2025.


			CENTENE CORPORATION

			By:			/s/ SARAH M. LONDON
						Chief Executive Officer (principal executive officer)


			By:			/s/ ANDREW L. ASHER
						Executive Vice President, Chief Financial Officer (principal financial officer)


			By:			/s/ KATIE N. CASSO
						Senior Vice President, Finance, Corporate Controller and Chief Accounting Officer (principal accounting officer)

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EXHIBIT 10.1

CENTENE CORPORATION

Non-Employee Director Compensation Policy as of May 13, 2025

This Non-Employee Director Compensation Policy (the “Policy”) sets forth the compensation to be paid to non-employee members (“Non-Employee Directors”) of the Board of Directors (the “Board”) of Centene Corporation (the “Company”), which shall remain in effect until amended, replaced or rescinded by further action of the Board.

Annual Cash Retainers and Fees

Effective May 13, 2025, the cash retainers and fees for Non-Employee Directors will be as set forth below and shall be cumulative.

Board Service:

•A base annual cash retainer of $100,000.

Independent Chair of the Board/Lead Independent Director:

•The non-executive Chairman of the Board will be eligible to receive the $100,000 annual cash retainer that all members of the Board receive, as well as an annual grant of restricted stock units with a grant date fair market value of $225,000 that all members of the Board receive (discussed below), which vest annually at the earlier of the first anniversary of the date of the grant or the date of the next annual meeting of stockholders. In addition, the non-executive Chairman will also receive an additional grant of restricted stock units with a grant date fair market value of $150,000, which vest annually at the earlier of the first anniversary of the date of the grant or the date of the next annual meeting of stockholders, and may be deferred in accordance with a deferral election form provided by the Company. The non-executive Chairman will also receive an additional cash retainer of $90,000 per year.

Chairs of Standing Committees:

•Audit and Compliance Committee – The Chair of the Audit and Compliance Committee shall receive an additional annual cash retainer of $30,000.

•Compensation and Talent Committee – The Chair of the Compensation and Talent Committee shall receive an additional annual cash retainer of $20,000.

•Governance Committee – The Chair of the Governance Committee shall receive an additional annual cash retainer of $20,000.

•Quality Committee – The Chair of the Quality Committee shall receive an additional annual cash retainer of $20,000.

Payments

The annual cash retainers for service on the Board and committees of the Board as set forth above shall be paid by the Company in quarterly installments as soon as practicable after the end of each of the Company’s fiscal quarters for which the member shall have served. A Non-Employee Director who serves on the Board or a committee during a portion of a quarterly period shall be entitled to the pro-rata portion of the quarterly installment based on the number of days the Non-Employee Director served as a Non-Employee Director during the quarterly period.

All cash fees payable to Non-Employee Directors are eligible for deferral under the Non-Employee Directors Deferred Stock Compensation Plan (as amended and restated). The number of restricted stock units granted shall be determined by reference to the closing sales price of the Company’s common stock on the New York Stock Exchange on the trading day preceding the date that the fees would otherwise have been paid to the Non-Employee Director.

Initial Equity Awards

Unless otherwise determined by the Compensation and Talent Committee and subject to the Board’s approval, upon, and contingent on, a new Non-Employee Director’s appointment to the Board, shall receive an initial equity award of restricted stock units with a grant date fair market value of approximately $225,000, pro-rated (based on a 365-day year) for the number of days between the appointment of the Non-Employee Director and the anticipated date of the next annual meeting of stockholders at the time of appointment or election as determined by the Secretary of the Company, rounded to the nearest whole share, as determined by reference to the closing sales price of the Company’s common stock on the New York Stock Exchange on the day preceding the grant date, pursuant to and in accordance with the terms and provisions of a restricted stock unit agreement and the Company’s 2025 Incentive Stock Plan (the “2025 Plan”) or any successor plan thereto. Such equity awards shall vest in full on the earlier of the first anniversary of the date of the grant or the date of the next annual meeting of stockholders and may be deferred in accordance with a deferral election form provided by the Company.

Annual Equity Awards

Unless otherwise determined by the Compensation and Talent Committee and subject to the Board’s approval, each Non-Employee Director shall receive an annual equity award of restricted stock units, with a grant date fair market value of approximately $225,000, rounded to the nearest whole share, as determined by reference to the closing sales price of the Company’s common stock on the New York Stock Exchange on the trading day immediately preceding the grant date, pursuant to and in accordance with the terms and provisions of a restricted stock unit agreement, and the 2025 Plan or any successor plan thereto. Unless otherwise determined by the Compensation and Talent Committee, all such annual equity awards shall be granted on the date of the Company’s annual meeting of stockholders. Such equity awards shall vest in full on the earlier of the first anniversary of the date of the grant or the date of the next annual meeting of stockholders and may be deferred in accordance with a deferral election form provided by the Company.

Director Compensation Limit

In accordance with the 2025 Plan, a Non-Employee Director shall not receive compensation in the aggregate, including cash payments and equity awards, but excluding any vested deferred compensation from any prior year, in excess of $1,000,000 during each calendar year while serving in such capacity.

Charitable Matching Gift Program

Under the Board of Directors Charitable Matching Gift Program, the Company will match a Non-Employee Director’s qualifying charitable donation up to $25,000 per calendar year. Charitable donations must be made to a qualified tax-exempt U.S. organization under the Internal Revenue Code Section 501(c)(3) and within the Company’s charitable contribution guidelines.

Liability Insurance

The Company shall provide a group excess liability insurance policy at no cost to the Non-Employee Directors.

Expenses

Non-Employee Directors will be reimbursed for all reasonable expenses incurred in connection with their service on the Board or any of its committees.

Stock Ownership Guidelines

Non-Employee Directors are required to own shares of the Company’s common stock (the “Ownership Requirement”) having a value (as described below) equal to the sum of seven and a half (7.5) times the base annual cash retainer payable to each Non-Employee Director as set forth in this Policy as in effect from time to time.

For purposes of determining ownership, the following will be used in determining whether a Non-Employee Director has satisfied the Ownership Requirement:

•One hundred percent (100%) of the value of shares of the Company’s common stock owned individually, either directly or indirectly, including vested and unvested restricted stock, restricted stock unit awards or shares acquired upon exercise of stock options; and

•Shares of the Company’s common stock owned jointly, or separately by a spouse, domestic partner and/or minor children, directly or indirectly.

No other rights to acquire shares of Company common stock (including stock options or similar rights) shall be considered shares of Company common stock for purposes of meeting the Ownership Requirements under this Policy.

For purposes hereof, the value of a share of the Company’s common stock, including vested and unvested restricted stock and restricted stock units, shall be calculated on September 30th of each year as determined by reference to the closing sales price of the Company’s common stock on the New York Stock Exchange on previous date of the calculation (a “Determination Date”). If a Non-Employee Director does not meet the Ownership Requirement as of the Determination Date following the fifth anniversary of such Non-Employee Director’s election or appointment to the Board, such Non-Employee Director is expected to satisfy the Ownership Requirement on the next Determination Date and is not allowed to sell shares until Ownership Requirements are met.

In the event the base annual cash retainer increases, each Non-Employee Director will have five (5) years from the time of the increase to acquire any additional shares needed to satisfy the Ownership Requirement.

A Non-Employee Director shall have until the end of the first Determination Date following the fifth anniversary of such Non-Employee Director’s election or appointment to the Board or upon otherwise becoming a Non-Employee Director of the Board to satisfy the Ownership Requirement.

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EXHIBIT 10.2

CENTENE CORPORATION

Form of Restricted Stock Unit Agreement Granted Under

2025 Stock Incentive Plan

THIS AGREEMENT is entered into by Centene Corporation, a Delaware corporation (hereinafter the “Company”), and <<Participant Name>> (hereinafter the “Participant”).

WHEREAS, the Company desires to align the long-term interests of its directors with those of the Company by providing the ownership interest granted herein;

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements herein contained, the parties hereto hereby agree as follows:

1.Grant of RSUs.

This Agreement evidences the grant by the Company on <<Grant Date>> (or the “Grant Date”) to <<Participant Name>> of <<RSU#>> restricted stock units (each an “RSU,” and collectively the “RSUs”) pursuant to the Company’s 2025 Stock Incentive Plan (the “Plan”), that will settle in shares of common stock, $.001 par value per share, of the Company (“Common Stock”), as provided in this RSU Agreement (the “Agreement”). The shares of Common Stock that are issuable upon vesting of the RSUs are referred to in this Agreement as “Shares.” Capitalized terms not otherwise defined in this Agreement have the meanings ascribed to such terms in the Plan.

2.Vesting.

Subject to Section 3 and 4 of this Agreement, 100% of the RSUs shall become vested on the earlier of the one year anniversary of the grant date and date of the next annual meeting of stockholders of the Company which is at least 50 weeks after the immediately preceding year’s annual meeting (such date, the “Vesting Date”), provided that the continuous service of the Participant continues through the Vesting Date.

#VestingDateandQuantity#

3.Reorganization Event.

The foregoing vesting schedule notwithstanding, if a Change in Control (as defined in the Plan) occurs, all unvested RSUs shall automatically become 100% vested (“CIC Payment”) and to be settled no later than 30 days following the occurrence of the Change in Control or such later date as required to comply with Section 409A.

4.Distribution of Shares.

(a)Timing of Distribution. The Company will distribute to the Participant (or to the Participant’s beneficiary in the event of the death of the Participant occurring after the Vesting Date but before distribution of the corresponding Shares), as soon as administratively practicable after the Vesting Date (to be settled no later than 30 days following such event), the Shares represented by RSUs that vested on such Vesting Date, except that, payment shall occur earlier and extinguish any further payment on any future Vesting Date in the event that a CIC Payment occurs or payment on death or disability occurs in accordance with Section 4(c) or, if applicable, in accordance with the terms of a valid deferral election made by the Participant with respect to the RSUs under the Company’s deferral election form.

(b)No Fractional Shares. No fractional Shares shall be issuable pursuant to any RSU. In lieu of any fractional shares to which the Participant would otherwise be entitled, the Company may, in its discretion, determine whether to pay, in lieu of such fractional Share, cash in an amount equal to such fractional Share multiplied by the Fair Market Value (as defined in the Plan) of a share of Common Stock, or whether any such fractional Share should be rounded down to the nearest whole Share, forfeited without consideration therefor, or otherwise eliminated.

(c)Termination of Service. In the event that the Participant’s service with the Company is terminated for any reason by the Company or by the Participant other than by reason of death or disability (within the meaning of Section 409A(a)(2)(c) of the Internal Revenue Code of 1986, as amended (the “Code”)), the unvested RSUs shall cease vesting and be forfeited as of the date of termination. In the event the Participant’s service with the Company is terminated by reason of death or disability (as defined previously in this Section 4(c)), 100% of the RSUs shall immediately vest and be distributed on the date of such death or disability (or within 30 days thereafter).

(d)Compliance Restrictions. The Company shall not be obligated to issue to the Participant the Shares upon the vesting of any RSU (or otherwise) unless the issuance and delivery of such Shares shall comply with all relevant provisions of law and other legal requirements including any applicable federal or state securities laws and the requirements of any stock exchange or quotation system upon which Common Stock may then be listed or quoted.

5.Restrictions on Transfer.

The RSUs may not be sold, assigned, transferred, pledged or otherwise encumbered by the Participant, either voluntarily or by operation of law, except to the Participant's beneficiary as provided in Section 4(a) in the event of the Participant's death. The Participant's beneficiary can be designated and recorded with the Company’s stock plan administrator. In the absence of any such beneficiary designation, benefits remaining unpaid at the Participant’s death shall be paid to the Participant’s executor, administrator, or legal representative.

6.No Rights as a Stockholder.

Except as set forth in the Plan, neither the Participant nor any person claiming under or through the Participant shall be, or shall have any rights or privileges of, a stockholder of the Company in respect of any Share issuable pursuant to the RSUs granted hereunder until such Share has been delivered to the Participant.

7.Withholding Taxes.

The Participant acknowledges and agrees that the Company has the right to deduct from payments of any kind otherwise due to the Participant any federal, state or local taxes of any kind required by law to be withheld with respect to the RSUs. The Participant acknowledges that, regardless of any action taken by the Company, the ultimate liability for all income tax, social insurance, payroll tax, fringe benefits tax, payment on account or other tax-related items related to the Participant’s participation in the Plan and legally applicable to the Participant is and remains the Participant’s responsibility.

8.Provisions of the Plan.

The RSUs are subject to the provisions of the Plan, a copy of which is being furnished to the Participant with this Agreement.

9.Miscellaneous.

(a)Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law. If a court of competent jurisdiction should determine that any of the provisions of this Agreement are overbroad or otherwise unenforceable because of the scope of such provisions, to the extent allowed by law, such court shall modify such provisions in a manner to render them enforceable, and such provisions, as may be modified, shall be fully enforceable as though set forth herein. Any such modification shall not affect the other provisions or clauses of this Agreement in any respect.

(b)Waiver. Any provision for the benefit of the Company contained in this Agreement may be waived, either generally or in any particular instance, by the Board of Directors of the Company.

(c)Binding Effect. This Agreement shall be binding upon and inure to the benefit of the Company and the Participant and their respective heirs, executors, administrators, legal representatives, successors and assigns, subject to the restrictions on transfer set forth in Section 5 of this Agreement.

(d)Notice. All notices required or permitted hereunder shall be in writing and deemed effectively given upon personal delivery or five days after delivery to a United States Post Office, by registered or certified mail, postage prepaid, addressed to the other party hereto at the address shown beneath his or its respective signature to this Agreement, or at such other address or addresses as either party shall designate to the other in accordance with this subparagraph (d).

(e)Entire Agreement. This Agreement and the Plan constitute the entire agreement between the parties, and supersede all prior agreements and understandings, relating to the RSUs.

(f)Participant’s Acknowledgments. The Participant acknowledges that he or she: (i) has read this Agreement; (ii) has been represented in the preparation, negotiation, and execution of this Agreement by legal counsel of the Participant’s own choice or has voluntarily declined to seek such counsel; (iii) understands the terms and consequences of this Agreement; and (iv) is fully aware of the legal and binding effect of this Agreement.

(g)Unfunded Rights. The right of the Participant to receive Common Stock pursuant to this Agreement is an unfunded and unsecured obligation of the Company. The Participant shall have no rights under this Agreement other than those of an unsecured general creditor of the Company.

(h)Deferral. The Participant may elect to defer delivery of Shares issuable under unvested RSUs in accordance with the terms of a valid deferral election made by the Participant with respect to the RSUs under the Company’s deferral election form. Neither the Company nor the Participant may defer delivery of any Shares issuable under unvested RSUs except to the extent that such deferral complies with the provisions of Section 409A.

(i)Section 409A.

(i)This Agreement is intended to comply with the requirements of Section 409A, including the exceptions thereto, and shall be construed and administered in accordance with such intent. Notwithstanding any other provision of this Agreement, payments provided under this Agreement may only be made upon an event and in a manner that complies with Section 409A or an applicable exemption. For purposes of Section 409A, each installment payment provided under this Agreement shall be treated as a separate payment. Any payments to be made under this Agreement in connection with a termination of service shall only be made if such termination of service constitutes a "separation from service" under Section 409A. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Agreement comply with Section 409A and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A.

(ii)If any provision of this Agreement or the Plan shall be invalid or unenforceable, in whole or in part, or as applied to any circumstance, under the laws of any jurisdiction that may govern for such purpose, or if any provision of this Agreement or the Plan needs to be interpreted to comply with the requirements of Section 409A, then such provision shall be deemed to be modified or restricted, or so interpreted, to the extent and in the manner necessary to render the same valid and enforceable, or to the extent and in the manner necessary to be interpreted in compliance with such requirements of the Code, either generally or as applied to such circumstance, or shall be deemed excised from this Agreement or the Plan, as the case may require, and this Agreement or the Plan shall be construed and enforced to the maximum extent permitted by law as if such provision had been originally incorporated herein as so modified or restricted, or as if such provision had not been originally incorporated herein, as the case may be.

(iii)Notwithstanding any other provision of this Agreement, if at the time of the Participant’s termination of service, the Participant is a "specified employee," determined in accordance with Section 409A, any payments and benefits provided under this Agreement that constitute "nonqualified deferred compensation" subject to Section 409A that are provided to the Participant on account of separation from service shall not be paid until the first payroll date to occur following the six-month anniversary of the Participant’s termination date ("Specified Employee Payment Date"). The aggregate amount of any payments that would otherwise have been made during such six-month period shall be paid in a lump sum on the Specified Employee Payment Date without interest. If the Participant dies before the Specified Employee Payment Date, any delayed payments shall be paid to the Participant’s beneficiary in a lump sum within upon the Participant’s death.

(j)Provisions Related to Golden Parachute Excise Tax.

(i)Change in Control When the Shares are Not Publicly Traded. Notwithstanding anything to the contrary contained in this Agreement, to the extent that, upon a Change in Control prior to the time at which the Shares have become publicly traded, any of the payments and benefits provided for under the Plan, any award agreement or any other agreement or arrangement between the Company or any of its affiliates and the Participant (collectively, the “Payments”) would constitute a “parachute payment” within the meaning of Section 280G of the Code (a “Parachute Payment”), the amount of such Payments shall be reduced to the amount (the “Safe Harbor Amount”) that would result in no portion of the Payments being treated as an excess parachute payment pursuant to Section 280G of the Code (the “Excise Tax”). If, upon a Change in Control prior to the time at which the Shares have become publicly traded, the Parachute Payments that would otherwise be reduced or eliminated, as the case may be, pursuant to this Section 9(j)(i) could be paid without the loss of a deduction under Section 280G of the Code if the shareholder approval exception to treatment as a Parachute Payment can be and is satisfied, then the Company shall use its reasonable best efforts to cause such Parachute Payments to be submitted for such approval in accordance with Section 280G(b)(5)(B) prior to the Change in Control giving rise to such Parachute Payments. If such approval is received, any reduction or forfeiture pursuant to this Section 9(j)(i) shall be

reversed, and the subject amount shall be payable to the Participant without regard to this Section 9(j).

(ii)Change in Control When the Shares are Publicly Traded. If upon a Change in Control occurring at any time that the Shares are publicly traded, any Payments would constitute Parachute Payments, then, if and solely to the extent that reducing the benefits payable hereunder would result in the Participant’s receiving a greater amount, on an after-tax basis, taking into account any Excise Tax and all applicable income and other taxes payable on such amounts, the amounts payable hereunder shall be reduced or eliminated, as the case may be, so that the total amount of Parachute Payments received by the Participant do not exceed the Safe Harbor Amount.

(iii)Order of Reduction in Payments. Any reduction in the amount of compensation or benefits effected pursuant to this Section 9(j) shall first come, in order and, in each case, solely to the extent necessary, from any cash severance benefits payable to the Participant, then from any other payments which are treated in their entirety as Parachute Payments and then from any other Parachute Payments payable to the Participant with the later possible payment or vesting date being reduced or eliminated before a payment or benefit with an earlier payment or vesting date; provided that if the foregoing order of reduction or elimination would violate Section 409A, then the reduction shall be made pro rata among the payments or benefits otherwise due or payable to the Participant.

(k)Consent to Electronic Delivery; Electronic Signature.

In lieu of receiving documents in paper format, the Participant accepts the electronic delivery of any documents by the Company, or any third party involved in administering the Plan that the Company may designate, may deliver in connection with this Award (including the Plan, this Agreement, account statements, or other communications or information) whether via the Company’s intranet or the internet site of such third party or via email or such other means of electronic delivery specified by the Company. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or any third party involved in administering the Plan that the Company may designate and agrees that the Participant’s electronic signature is the same as, and shall have the same force and effect as, the Participant’s manual signature.



Participant Signature						Date

ELECTRONIC ACCEPTANCE

By the Participant’s electronic acceptance hereof, the Participant and the Company agree that this Award is granted and governed by the terms and conditions of the Plan and this Agreement.

By the Participant’s electronic acceptance hereof, the Participant agrees that in lieu of receiving documents in paper format, the Participant accepts the electronic delivery of any documents by the Company, or any third party involved in administering the Plan that the Company may designate, may deliver in connection with this Award (including the Plan, this Agreement, account statements, or other communications or information) whether via the Company’s intranet or the internet site of such third party or via email or such other means of electronic delivery specified by the Company. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or any third party involved in administering the Plan that the Company may designate.

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EXHIBIT 10.3

CENTENE CORPORATION

NON-EMPLOYEE DIRECTORS

DEFERRED STOCK COMPENSATION PLAN

As amended and restated as of May 13, 2025

ARTICLE I

INTRODUCTION

I.1 Establishment. Centene Corporation (the “Company”) hereby establishes the Centene Corporation Non-Employee Directors Deferred Stock Compensation Plan, as amended and restated (the “Plan”) for those directors of the Company who are not employees of the Company or any of its subsidiaries or affiliates. The Plan allows Non-Employee Directors to defer the receipt of cash compensation and to elect to receive such compensation in the form of Shares in lieu of cash.

I.2 Purpose. The Plan is intended to advance the interests of the Company and its stockholders by providing a means to attract and retain qualified persons to serve as Non-Employee Directors and to promote ownership by Non-Employee Directors of a greater proprietary interest in the Company, thereby aligning such Directors' interests more closely with the interests of stockholders of the Company.

I.3 Effective Date. The Plan was effective as of September 15, 2004 (the “Effective Date”). This restatement shall be effective as of May 13, 2025.

ARTICLE II

DEFINITIONS

II.1 “Board” means the Board of Directors of the Company.

II.2 “Change in Control” means the occurrence of any of the following:



(a)			Any “Person” (having the meaning ascribed to such term in Section 3(a)(9) of the Securities Exchange Act of 1934, as amended (“1934 Act”) and used in Sections 13(d) and 14(d) thereof, other than (A) Persons, who, on the Effective Date of the Plan, are beneficial owners (within the meaning of Rule 13d-3 under the 1934 Act) directly or indirectly of twenty-five percent (25%) or more of the Company's then outstanding voting securities entitled to vote generally in the election of directors (“Voting Securities”) or (B) a group which includes one or more Plan participants, is or become beneficial owners directly or indirectly of fifty percent (50%) or more of the combined voting power of the Company's Voting Securities.

(b)			If individuals who, as the Effective Date hereof, constitute the Board of Directors of the Company (the “Incumbent Board) cease for any reason to constitute at least a majority of the Board of Directors of the Company; provided, however, that an individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company's shareholders, was approved by at least a majority of the directors then comprising the Incumbent Board shall be included within the definition of Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of either an actual election contest (or such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board.


(c)			The shareholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the Voting Securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into Voting Securities of the surviving entity) at least fifty percent (50%) of the combined voting power of the Voting Securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, and such merger or consolidation occurs.

(d)			The shareholders of the Company approve a plan of complete liquidation or dissolution of the Company and such event commences, or there is consummated an agreement for the sale or disposition of all or substantially all of the assets of the Company, other than a sale or disposition by the Company of all or substantially all of the assets of the Company to an entity at least fifty percent (50%) of the combined voting securities of which are owned by shareholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such transaction.

An event shall be considered a Change in Control only if such event satisfies the above definition and such event is a change in the ownership or effective control of a corporation or a change in the ownership of a substantial portion of the assets of a corporation under Code Section 409A.

II.3 “Code” means the Internal Revenue Code of 1986, as amended, and the regulations and other guidance promulgated thereunder.

II.4 “Committee” means the Board or a committee appointed to administer the Plan under Article IV.

II.5 “Common Stock” means the Company's class of capital stock designated as Common Stock, par value one tenth of one cent ($0.001) per share, or, in the event that the outstanding shares of Common Stock are after the Effective Date recapitalized, converted into or exchanged for different stock or securities of the Company, such other stock or securities.

II.6 “Company” means Centene Corporation, a Delaware corporation, or any successor thereto.

II.7 “Deferral Date” means the date Fees would otherwise have been paid to the Participant.

II.8 “Deferral Election” means a written election to defer Fees under the Plan.

II.9 “Director” means any individual who is a member of the Board.

II.10 “Fair Market Value” of a share of Common Stock on a given valuation date means (i) the closing sales price for such Common Stock reported on the New York Stock Exchange on the day prior to such valuation date, (ii) if the Common Stock is not listed on the New York Stock Exchange, the closing sales price for such Common Stock as reported on the day prior to such valuation date on the principal stock exchange or quotation system in the U.S. on which Common Stock is listed or quoted (as determined by the Committee), or (iii) if neither of the preceding clauses is applicable, the fair market value of a share of Common Stock as determined in good faith by the Board on such valuation date and stated in writing in a notice delivered to the holders of Common Stock involved.

II.11 “Fees” means all or part of any retainer or meeting fees payable in cash to a Non-Employee Director in his or her capacity as a Director. Fees shall not include (i) any expenses paid directly or through reimbursement or (ii) any annual equity awards.

II.12 “Non-Employee Director” means a Director who is not an employee of the Company or any of its subsidiaries or affiliates. For purposes of the Plan, an employee is an individual whose wages are subject to withholding of federal income tax under Section 3401 of the Internal Revenue Code of 1986, as amended.

II.13 “Participant” means a Non-Employee Director who defers Fees under Article VI of the Plan.

II.14 “Secretary” means the Secretary or any Assistant Secretary of the Company.

II.15 “Shares” means shares of the Common Stock.

II.16 “Stock Units” means the credits to a Participant's Stock Unit Account under Article VI of the Plan, each of which represents the right to receive one Share upon settlement of the Stock Unit Account.

II.17 “Stock Unit Account” means the bookkeeping account established by the Company pursuant to Section VI.5.

II.18 “Termination of Service” means termination of service as a Director for any reason.

ARTICLE III

SHARES AVAILABLE UNDER THE PLAN

Subject to adjustment as provided in Article X, the maximum number of Shares that may be distributed in settlement of Stock Unit Accounts under the Plan shall be two million (2,000,000). Such Shares may include authorized but unissued Shares, treasury Shares or Shares that have been reacquired by the Company.

ARTICLE IV

ADMINISTRATION

The Plan shall be administered by the Board or such other committee as may be designated by the Board. The Committee shall have the authority to make all determinations it deems necessary or advisable for administering the Plan, subject to the express provisions of the Plan. Notwithstanding the foregoing, no Director who is a Participant under the Plan shall participate in any determination relating solely or primarily to his or her own Shares, Stock Units or Stock Unit Account.

ARTICLE V

ELIGIBILITY

Each person who is a Non-Employee Director on a Deferral Date shall be eligible to defer Fees payable on such date in accordance with Article VI of the Plan. If any Non-Employee Director subsequently becomes an employee of the Company or any of its subsidiaries, but does not incur a Termination of Service, such Director shall continue as a Participant with respect to Fees previously deferred and Fees subject to a current deferral election, but shall cease eligibility with respect to all future Fees, if any, earned while an employee.

ARTICLE VI

DEFERRAL ELECTIONS IN LIEU OF CASH PAYMENTS

VI.1 General Rule. Each Non-Employee Director may, in lieu of receipt of Fees, defer such Fees in accordance with this Article VI and with applicable stock exchange requirements, provided that such Non-Employee director is eligible under Article V of the Plan to defer such Fees at the date any such Fees are otherwise payable. A Director may only elect to defer one hundred percent (100%) of his or her Fees.

VI.2 Timing of Election. A Non-Employee Director may make a Deferral Election within thirty (30) days after commencing to serve as a Non-Employee Director, effective for Fees for services rendered and payable after the date such election is made. A Non-Employee Director who does not make a Deferral Election when first eligible to do so may make a Deferral Election at such time before the first day of any subsequent calendar year for which such Deferral Election shall be effective, in accordance with administrative procedures established with respect to the Plan.

VI.3 Effect and Duration of Election. A Deferral Election shall apply to Fees for services rendered and payable after the date such election is made and shall be deemed to be continuing and applicable to all Fees payable in subsequent calendar years, unless the participant revokes or modifies such election by filing a new election form at such time before the first day of any subsequent calendar year in accordance with administrative procedures established with respect to the Plan, effective for all Fees for services rendered and payable on and after the first day of such subsequent calendar year.

VI.4 Form of Election. A Deferral Election shall be made in a manner satisfactory to the Committee. Generally, a Deferral Election shall be made by completing and filing the specified election form with the Secretary or his or her designee within the period described in Section VI.2 or Section VI.3.

VI.5 Establishment of Stock Unit Account. The Company shall establish a Stock Unit Account for each Participant. All Fees deferred pursuant to this Article VI shall be credited to the Participant's Stock Unit Account as of the Deferral Date and converted to Stock Units. The number of Stock Units credited to a Participant's Stock Unit Account as of a Deferral Date shall equal the amount of the deferred Fees divided by the Fair Market Value of a Share on such Deferral Date, rounded to the nearest whole share. If there are fractional Stock Units in a Participant's Stock Unit Account at the time of a distribution under Article VII, the amount shall be rounded down to the nearest whole share on the date of distribution.

VI.6 Crediting of Dividend Equivalents. As of each dividend payment date with respect to Shares, each Participant shall have credited to his or her Stock Unit Account a dollar amount equal to the amount of cash dividends that would have been paid on the number of Shares equal to the number of Stock Units credited to the Participant's Stock Unit Account as of the close of business on the record date for such dividend. Such dollar amount shall then be converted into a number of Stock Units equal to the number of whole and fractional Shares that could have been purchased with such dollar amount at Fair Market Value on the dividend payment date.

ARTICLE VII

SETTLEMENT OF STOCK UNITS

VII.1 Timing of Payment. A Participant shall receive or begin receiving a distribution of his or her Stock Unit Account in the manner described in Section VII.2 either (i) on or as soon as administratively feasible after the first day of the second full calendar month immediately following the month in which the Participant incurs a Termination of Service (but not less than six months after the Participant has made a Deferral Election), (ii) if the Participant has made an election to defer payment in accordance with this Section, on or as soon as administratively feasible after the date specified by the Participant in such election, or (iii) if elected by the Participant, upon a Change of Control. A Participant must deliver an election to defer the distribution or commencement of distribution beyond the date applicable in clause (i) to the Secretary or his or her designee at the time that the Participant makes the deferral election pursuant to Article VI. A Participant may make an election to make a subsequent deferral election at least one (1) year before the earlier of the date on which the Participant incurs a Termination of Service or the previously designated distribution date; provided that, the first payment with respect to which the election is made shall be deferred for at least five (5) years from the date the payment would otherwise have been made.

VII.2 Payment Options. A Deferral Election filed under Article VI shall specify whether the Participant's Stock Unit Account is to be settled by delivering to the Participant the number of Shares equal to the number of whole Stock Units then credited to the Participant's Stock Unit Account, in either (i) a lump sum, or (ii) substantially equal annual installments over a period not to exceed five (5) years. A Participant may change the manner in which his or her Stock Unit Account is distributed by delivering a new election form to the Secretary or to his or her designee at least one (1) year before the earlier of the date on which the Participant incurs a Termination of Service or the previously designated distribution date; provided that, the first payment with respect to which the election is made shall be deferred for at least five (5) years from the date the payment would otherwise have been made.

VII.3 Payment Upon Death of a Participant. If a Participant dies before the entire balance of his or her Stock Unit Account has been distributed, the balance of the Participant's Stock Unit Account shall be paid in Shares as soon as administratively feasible after the Participant's death, to the beneficiary designated by the Participant under Article IX.

VII.4 Continuation of Dividend Equivalents. If the distribution of Shares is deferred pursuant to Section VII.2, the Participant's Stock Unit Account shall continue to be credited with dividend equivalents as provided in Section VI.6 on the undistributed Stock Units until the entire balance of the Participant's Stock Unit Account has been distributed.

ARTICLE VIII

UNFUNDED STATUS

VIII.1 General. The interest of each Participant in any Fees deferred under the Plan (and any Stock Units or Stock Unit Account relating thereto) shall be that of an unsecured general creditor of the Company. Stock Unit Accounts, and Stock Units credited thereto, shall at all times be maintained by the Company as bookkeeping entries evidencing unfunded and unsecured general obligations of the Company. Except as provided in Section VIII.2, any money or other assets set aside or earmarked for the purpose of satisfying the obligations of the Company hereunder shall at all times be the property of the Company and the Participant shall have no interest in such assets other than as an unsecured general creditor of the Company.

VIII.2 Trust. To the extent determined by the Board, the Company may transfer funds necessary to fund all or part of the payments under the Plan to a trust; provided, the assets held in such trust shall remain at all times subject to the claims of the general creditors of the Company. No participant or beneficiary shall have any interest in the assets held in such trust or in the general assets of the Company other than as an unsecured general creditor.

ARTICLE IX

DESIGNATION OF BENEFICIARY

Each Participant may designate, on a form provided by the Committee, one or more beneficiaries to receive payment of the Participant's Stock Unit Account in the event of such Participant's death. The Company may rely upon the beneficiary designation list filed with the Committee, provided that such form was executed by the Participant or his or her legal representative and filed with the Committee prior to the Participant's death. If a Participant has not designated a beneficiary, or if the designated beneficiary is not surviving when a payment is to be made to such person under the Plan, the beneficiary with respect to such payment shall be the Participant's surviving spouse, or if there is no surviving spouse, the Participant's estate.

ARTICLE X

ADJUSTMENT PROVISIONS

In the event of a reorganization, recapitalization, stock split, stock dividend, spin-off, combination, corporate exchange, merger, consolidation or other change in the Common Stock or any distribution to stockholders of Common Stock other than cash dividends or any transaction determined in good faith by the Board or Committee to be similar to the foregoing, the Board or Committee shall make appropriate equitable changes in the number and type of Shares authorized by this Plan, and the number and type of Shares to be delivered upon settlement of Stock Unit Accounts under Article VII.

ARTICLE XI

GENERAL PROVISIONS

XI.1 No Stockholder Rights Conferred. Nothing contained in the Plan will confer upon any Participant or beneficiary any rights of a Stockholder of the Company, unless and until Shares are in fact issued or transferred to such Participant or beneficiary in accordance with Article VII.

XI.2 Changes to The Plan. The Board may amend, alter, suspend, discontinue, extend, or terminate the Plan without the consent of Participants; provided, no action taken without the consent of an affected Participant may materially impair the rights of such Participant with respect to any Stock Units credited to his or her Stock Unit Account at the time of such change or termination except that the Board may without the consent of any Participant terminate the Plan and distribute Shares with respect to Stock Units then credited to Participant's Stock Unit Account upon a Change in Control. A termination of the Plan must comply with the restrictions or requirements applicable under Code Section 409A and the regulations promulgated thereunder.

XI.3 Compliance With Laws and Obligations. The Company will not be obligated to issue or deliver Shares in connection with the Plan in a transaction subject to the registration requirements of the Securities Act of 1933, as amended, or any other federal or state securities law, any requirement under any listing agreement between the Company and any national securities exchange or automated quotation system or any other laws, regulations, or contractual obligations of the Company, until the Company is satisfied that such laws, regulations and other obligations of the Company have been complied with in full. Certificates representing Shares delivered under the Plan will be subject to such restrictions as may be applicable under such laws, regulations and other obligations of the Company.

XI.4 Limitations on Transferability. Stock Units and other rights under the Plan may not be assigned, pledged, mortgaged, hypothecated or otherwise encumbered, and shall not be subject to the claims of creditors of any Participant.

XI.5 Governing Law. The validity, construction and effect of the Plan and any agreement hereunder will be determined in accordance with the Delaware General Corporation Law. Payments and benefits under the Plan are intended to comply with Section 409A of the Code to the extent subject thereto, and, accordingly, to the maximum extent permitted, this Plan shall be interpreted and administered to be in compliance therewith.

XI.6 Plan Termination. Unless earlier terminated by action of the Board pursuant to Section XI.2, the Plan will remain in effect until such time as no Shares remain available for delivery under the Plan and the Company has no further rights or obligations under the Plan. A termination of the Plan must comply with the restrictions or requirements applicable under Code Section 409A and the regulations promulgated thereunder.

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EXHIBIT 31.1

CERTIFICATION

I, Sarah M. London, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Centene Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Dated:	July 25, 2025	/s/ SARAH M. LONDON
		Chief Executive Officer (principal executive officer)

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EXHIBIT 31.2

CERTIFICATION

I, Andrew L. Asher, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Centene Corporation;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Dated:	July 25, 2025	/s/ ANDREW L. ASHER
		Executive Vice President, Chief Financial Officer (principal financial officer)

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EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Centene Corporation (the Company) for the period ended June 30, 2025, as filed with the Securities and Exchange Commission on the date hereof (the Report), the undersigned, Sarah M. London, Chief Executive Officer of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, that:

(1)the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Dated:	July 25, 2025	/s/ SARAH M. LONDON
		Chief Executive Officer (principal executive officer)

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EXHIBIT 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Centene Corporation (the Company) for the period ended June 30, 2025, as filed with the Securities and Exchange Commission on the date hereof (the Report), the undersigned, Andrew L. Asher, Executive Vice President and Chief Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, that:

(1)the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Dated:	July 25, 2025	/s/ ANDREW L. ASHER
		Executive Vice President, Chief Financial Officer (principal financial officer)