Drew Asher: Yes. So sometimes, it is tough to glean from public data exactly what we did with benefits or what any payer do with benefits. You can get directional. But if you sort of got into our bids and now our product set that’s being sold out there in the market today, you’d see that we heavily trimmed our Part B giveback and PPO plans, but we invested in D-SNP. And with the supplemental benefits, we actually combined a number of supplemental benefits into a simple spendables card. So think Flex, OTC, grocery. And so that simplifies it for the member and you may not actually be able to define that from some of the landscape files. But yes, as we said earlier, we haven’t changed our view on sort of our forecast for 2024 in terms of about $16 billion of Medicare Advantage revenue down about $4 billion.
Operator: Thank you. And our next question today comes from Scott Fidel with Stephens. Please go ahead.
Scott Fidel: Hi, thanks. Wanted to just ask about two salient points relative to medical costs. And first, just maybe an update on the behavioral utilization that you’ve been seeing earlier in the year and how that’s been getting factored into the rates and sort of comfort with that in 2024, I guess, particularly for the big Magellan behavioral book? And then second would just be definitely curious in your thinking just around the new California minimum wage law for health care workers and similar types of legislation and how you sort of are thinking about that factoring into unit costs and into your pricing looking out over the next several years? Thanks.
Sarah M. London: Yes. So relative to California, that does not apply to MCOs, but we’re obviously tracking that for potential pass-through costs from providers. So again, keeping an eye on that. Relative to behavioral, that’s still a component of underlying utilization. It’s not creating quite as much pressure as we were seeing before. But certainly, within the marketplace population in general, is sort of an industry-wide trend, substance used in opioid use disorder continues to be something that the whole industry is focused on. And to your point about Magellan, the increased focus on integrating medical care with behavioral and one of the things that we hear very consistently when we are out with our state partners, almost every single Governor that we have talked to this year, rates behavioral health and mental health as a number one issue in their state and whether that’s staffing shortages, access, thinking about broadband in order to increase telehealth, they are all focused on ways that they can support providing additional behavioral health to their membership, and it has actually created really nice tailwinds relative to our Magellan business.
So maybe, Ken, if you want to talk about some of the recent wins that Magellan has experienced as a result of this focus.
Ken Fasola: Yes. Thanks, Sarah, and good morning Scott. We realized success in the state of Idaho, which I think is a forbearer to opportunities to work with other states as they think about the point that Sarah made. I think she and I met over 30 Governors in the last six months. Every one of them mentioned behavioral health is top three. So we’re working with a number of states. I won’t mention them specifically, but behind the scenes to cultivate opportunities to capitalize on this growing interest among governors and supporting the needs of their Medicaid members with behavioral health. And then the point about the integrated offerings, our public sector, Magellan business, this is a long-standing distinctive competency.
It’s a business that will power and leverage as we think about combined offerings moving forward. And really excited about our prospects. And with Wade’s appointment, Zane and the team that runs business development here, leveraging the Magellan asset, a lot to like about the future.
Operator: Thank you. And our next question today comes from Sarah James at Cantor Fitzgerald. Please go ahead.
Sarah James: Thank you. So circling back to your comments on the levers having higher HBR than the stayers and 7 out of 21 states adjusting for acuity. Is there any way to give us more color on that sizing the range of the lever versus stayer HBR differential or how influential — how meaningful the acuity adjustments are to rates overall?
Drew Asher: Yes, it’s consistent with our expectations and as you might imagine, it really varies by state to state subpopulation to subpopulation. And you’re right, with the 1/1 rates, 7 of them in, all including acuity adjustments, feel pretty good about the matching of rates so far with a couple of exceptions, but in the aggregate, matching of the rates with our acuity forward estimates.
Sarah M. London: And I just want to add one clarification, I know this is what you meant, but I just want to be sure that what we’re tracking is that the levers HBR is less than the stayers. And that is what was expected. And so one of the things that we’ve talked about in the past that we did leading into the redeterminations process was identifying those members that we would have predicted would roll off as we look forward into the redetermination process, and then we could subset those populations and run the differential HBR. And those are the inputs that went into our model that we talked about on the Q1 call as we build up what both rate and acuity, we would want across each state and then rolled up to the portfolio in order to be tracking as we are in line with expectation going into 2024.
Operator: Thank you. And our next question today comes from Michael Ha with Morgan Stanley. Please go ahead.
Michael Ha: Thank you. Just first quickly, regarding exchange sequential membership growth, the 386,000, how much of that 386,000 is purely best recapture Medicaid redetermination? Number two, regarding MA, I’m curious to hear your thoughts on what transpired in California, the star ratings decline disruption there across a number of market-leading plans, whether that might positively impact your MA growth assumptions in California? And then lastly, on Star ratings improvement. I understand in 2Q, you had about 47% of your MA lives in value-based care arrangements. It grew about 3% year-to-year, but what was the percentage change of lives and downside arrangements, I’m curious because I understand if this metric improves, so does the overall consumer experience, which could help organically generate improvement in quality, consumer experience metrics, so I’m trying to understand how much tailwind that could be for next year? Thank you.
