12 Best Health Insurance Stocks to Buy in 2025

3. Elevance Health Inc. (NYSE:ELV)

Number of Hedge Fund Holders: 67

Elevance Health Inc. (NYSE:ELV), formerly known as Anthem, is one of the largest health insurance providers in the US. The company offers a range of services, including medical, pharmaceutical, dental, long-term care, disability, and behavioral health plans through brands like Anthem Blue Cross, Blue Shield, Wellpoint, and Carelon. Elevance Health Inc. (NYSE:ELV) ranks among the best health insurance stocks to buy in 2025.

The company is committed to enhancing its market presence, which is crucial for long-term growth. Elevance Health Inc. (NYSE:ELV) expanded its Affordable Care Act plans into Florida, Maryland, and Texas for the 2025 coverage year under the Wellpoint brand. Additionally, in its Medicare Advantage portfolio for 2025, the company’s plans are designed to be affordable and 90% of the plans have no monthly premium. Almost all plans offer $0 co-pays for primary care visits and provide access to additional benefits. In 2025, Elevance Health Inc. (NYSE:ELV) anticipates growth driven by increased adoption of its best-in-class products and services.

Vulcan Value Partners, an investment management company, shared insights about Elevance Health Inc. (NYSE:ELV) in its Q4 2024 investor letter. The letter noted that after a pause during the COVID-19 pandemic, states began to redetermine Medicaid eligibility in early 2023, which led to higher cancellations than expected. The remaining Medicaid population is older and sicker, which has resulted in higher-than-expected costs. This has caused Elevance Health Inc.’s (NYSE:ELV) medical loss ratio to rise, resulting in lower margins. The investment management firm noted that states set Medicaid reimbursement rates using data that lags by 12 to 18 months, which means that the higher costs are not yet reflected in these rates. Elevance Health Inc. (NYSE:ELV) expects that Medicaid reimbursement rates will be adjusted. Vulcan Value Partners also sees this as a short-term challenge and remains confident in the company’s long-term potential. The investment management company even added to its position in Elevance Health Inc. (NYSE:ELV) during the quarter.