What changed in this filing

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Item 1. Financial Statements

2022-07-20 compared with 2022-04-20 · 379 added, 197 removed, 891 unchanged (39% of the section changed)

FINANCIAL STATEMENTS

Elevance Health, Inc.

Consolidated Balance Sheets

51 unchanged sentences

See accompanying notes.

Elevance Health, Inc.

Consolidated Statements of Income

Three Months Ended

June 30 Six Months Ended

(In millions, except per share data) 2022 2021 2022 2021

4 unchanged sentences

Net investment income 381 400 741 691

Net losses on financial instruments ( 151 ) ( 4 )

Net (losses) gains on financial instruments ( 231 ) 172 ( 382 ) 168

Total revenues 38,632 33,851 76,727 66,236

4 unchanged sentences

Amortization of other intangible assets 166 90 295 170

Loss on extinguishment of debt — 5 — 5

Total expenses 36,489 31,498 72,258 61,707

Income before income tax expense

2,143 2,353 4,469 4,529

Income tax expense 493 552 1,024 1,061

7 unchanged sentences

See accompanying notes.

Elevance Health, Inc.

Consolidated Statements of Comprehensive Income

Three Months Ended

June 30 Six Months Ended

(In millions) 2022 2021 2022 2021

3 unchanged sentences

Change in non-credit component of impairment losses on investments

( 1 ) 1 ( 2 ) 2

Change in net unrealized gains/losses on cash flow hedges 3 2 6 6

1 unchanged sentence

Foreign currency translation adjustments ( 5 ) ( 6 ) ( 8 ) ( 6 )

Other comprehensive loss ( 1,063 ) ( 347 )

Other comprehensive (loss) income ( 916 ) 180 ( 1,979 ) ( 167 )

Net loss (income) attributable to noncontrolling interests 3 ( 8 ) 13 ( 10 )

Other comprehensive loss attributable to noncontrolling interests 5 2

Other comprehensive loss (income) attributable to noncontrolling interests 3 ( 2 ) 8 —

Total shareholders’ comprehensive income $ 740 $ 1,971 $ 1,487 $ 3,291

See accompanying notes.

Elevance Health, Inc.

Consolidated Statements of Cash Flows

Three Months Ended

Six Months Ended

(In millions) 2022 2021

2 unchanged sentences

Adjustments to reconcile net income to net cash provided by operating activities:

Net losses on financial instruments 151 4

Net losses (gains) on financial instruments 382 ( 168 )

Equity in net earnings of other invested assets ( 258 ) ( 309 )

22 unchanged sentences

Financing activities

Net proceeds from (repayments of) commercial paper borrowings 225 ( 250 )

Net proceeds from commercial paper borrowings 250 300

Proceeds from long-term borrowings 1,300 3,462

Repayments of long-term borrowings ( 943 ) ( 952 )

Proceeds from short-term borrowings 1,275 175

Repayments of short-term borrowings ( 1,375 ) —

Changes in securities lending payable 620 642

Changes in bank overdrafts 817 364

Repurchase and retirement of common stock ( 1,169 ) ( 927 )

9 unchanged sentences

See accompanying notes.

Consolidated Statements of Shareholders’ Equity

Elevance Health, Inc.

Consolidated Statements of Changes in Equity

Total Shareholders' Equity

Common Stock Additional

2 unchanged sentences

Comprehensive

(Loss) Income Noncontrolling

Loss Noncontrolling

Interests Total

11 unchanged sentences

March 31, 2022 241.1 2 9,151 28,058 ( 1,236 ) 56 36,031

Net income — — — 1,653 — ( 3 ) 1,650

Other comprehensive loss — — — — ( 913 ) ( 3 ) ( 916 )

Noncontrolling interests adjustment — — — — — 5 5

Repurchase and retirement of common stock ( 1.3 ) — ( 48 ) ( 576 ) — — ( 624 )

Dividends and dividend equivalents — — — ( 310 ) — — ( 310 )

Issuance of common stock under employee stock plans, net of related tax benefits 0.2 — 111 — — — 111

Convertible debenture repurchases and conversions — — ( 80 ) — — — ( 80 )

June 30, 2022 240.0 $ 2 $ 9,134 $ 28,825 $ ( 2,149 ) $ 55 $ 35,867

See accompanying notes.

Elevance Health, Inc.

Consolidated Statements of Changes in Equity (continued)

Total Shareholders' Equity

Common Stock Additional

Capital Retained

Earnings Accumulated

Comprehensive

Income (Loss) Noncontrolling

Interests Total

(In millions) Number of

January 1, 2021 245.4 $ 3 $ 9,244 $ 23,802 $ 150 $ — $ 33,199

1 unchanged sentence

Other comprehensive loss — — — — ( 345 ) ( 2 ) ( 347 )

Accumulated noncontrolling interest — — — — — 65 65

Accumulated noncontrolling interests — — — — — 65 65

Repurchase and retirement of common stock ( 1.4 ) ( 1 ) ( 53 ) ( 393 ) — — ( 447 )

1 unchanged sentence

Issuance of common stock under employee stock plans, net of related tax benefits

0.9 — 62 — — — 62

March 31, 2021 244.9 2 9,253 24,793 ( 195 ) 65 33,918

Net income — — — 1,793 — 8 1,801

Other comprehensive income — — — — 178 2 180

Noncontrolling interests adjustment — — — — — 3 3

Repurchase and retirement of common stock

( 1.3 ) — ( 47 ) ( 433 ) — — ( 480 )

Dividends and dividend equivalents — — — ( 279 ) — — ( 279 )

Issuance of common stock under employee stock plans, net of related tax benefits

0.3 — 119 — — — 119

Convertible debenture repurchases and conversions

— — ( 216 ) — — — ( 216 )

June 30, 2021 243.9 $ 2 $ 9,109 $ 25,874 $ ( 17 ) $ 78 $ 35,046

See accompanying notes.

Elevance Health, Inc.

Notes to Consolidated Financial Statements

March 31, 2022

June 30, 2022

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

References to the terms “we,” “our,” “us” or “Anthem” used throughout these Notes to Consolidated Financial Statements refer to Anthem, Inc., an Indiana corporation, and unless the context otherwise requires, its direct and indirect subsidiaries.

On May 18, 2022, our shareholders approved a proposal to amend our amended and restated articles of incorporation to change our name from Anthem, Inc.

to Elevance Health, Inc., which amendment and name change went into effect on June 27, 2022.

We began operating as Elevance Health, Inc.

and trading under our new ticker symbol “ELV” on June 28, 2022.

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

References to the “states” include the District of Columbia and Puerto Rico, unless the context otherwise requires.

On March 10, 2022, we announced our intent to change our name to better reflect our business and our journey from a traditional health benefits organization to a lifetime, trusted health partner.

At our annual meeting of shareholders on May 18, 2022, our shareholders will vote on a proposed amendment to our amended and restated articles of incorporation to change our name to Elevance Health, Inc.

Shareholders of record on March 17, 2022 are entitled to vote.

If approved by our shareholders, we expect the name change to occur in the second quarter of 2022.

We are one of the largest health benefits companies in the United States in terms of medical membership, serving nearly 47 million medical members through our affiliated health plans as of March 31, 2022.

Elevance Health is a health company with the purpose of improving the health of humanity.

We are the largest health insurer in the United States in terms of medical membership, serving over 47 million medical members through our affiliated health plans as of June 30, 2022.

We offer a broad spectrum of network-based managed care risk-based plans to Individual, Group, Medicaid and Medicare markets.

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In addition, we conduct business through arrangements with other BCBS licensees as well as other strategic partners.

Through our subsidiaries, we also serve customers in numerous states as AIM Specialty Health, Amerigroup, Aspire Health, Beacon, CareMore, Freedom Health, HealthLink, HealthSun, MMM, Optimum HealthCare, Simply Healthcare, and/or UniCare.

Through our subsidiaries, we also serve customers in numerous states as AIM Specialty Health, Amerigroup, Aspire Health, Beacon, CareMore, Freedom Health, HealthLink, HealthSun, Integra Managed Care, MMM, Optimum HealthCare, Simply Healthcare, and/or UniCare.

We offer PBM services through our IngenioRx, Inc.

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We are licensed to conduct insurance operations in all 50 states, the District of Columbia and Puerto Rico through our subsidiaries.

As part of our name change to Elevance Health, on June 15, 2022 we announced that over the next several years we will organize our brand portfolio into the following core go-to-market brands:

• Anthem Blue Cross/Anthem Blue Cross and Blue Shield — represents our existing Anthem-branded and affiliated Blue Cross and/or Blue Shield licensed plans;

• Wellpoint — we intend to unite select non-BCBSA licensed Medicare, Medicaid and Commercial plans under the Wellpoint name;

• Carelon — this brand will bring together our healthcare brands and capabilities, including our Diversified Business Group and IngenioRx business under a single brand name.

We now refer to our Diversified Business Group as Carelon.

In January 2023, IngenioRx will become CarelonRx.

There are currently no segment changes associated with this branding strategy.

Basis of Presentation and Significant Accounting Policies

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We have omitted certain footnote disclosures that would substantially duplicate the disclosures in our 2021 Annual Report on Form 10-K, unless the information contained in those disclosures materially changed or is required by GAAP.

In the opinion of management, all adjustments, including normal recurring adjustments, necessary for a fair statement of the consolidated financial statements as of and for the three months ended March 31, 2022 and 2021 have been recorded.

The results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2022, or any other period.

In the opinion of management, all adjustments, including normal recurring adjustments, necessary for a fair statement of the consolidated financial statements as of and for the three and six months ended June 30, 2022 and 2021 have been recorded.

The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2022, or any other period.

These unaudited consolidated financial statements should be read in conjunction with our audited consolidated financial statements as of and for the year ended December 31, 2021 included in our 2021 Annual Report on Form 10-K.

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dollar (“USD”).

We translate the assets and liabilities of those subsidiaries to USD using the exchange rate in effect at the end of the

We translate the assets and liabilities of those subsidiaries to USD using the exchange rate in effect at the end of the period.

We translate the revenues and expenses of those subsidiaries to USD using the average exchange rates in effect during the period.

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We control a number of bank accounts that are used exclusively to hold customer funds for the administration of customer benefits and we have cash and cash equivalents on deposit to meet certain regulatory requirements.

These amounts totaled $ 162 and $ 173 at March 31, 2022 and December 31, 2021, respectively, and are included in the cash and cash equivalents line on our consolidated balance sheets.

These amounts totaled $ 306 and $ 173 at June 30, 2022 and December 31, 2021, respectively, and are included in the cash and cash equivalents line on our consolidated balance sheets.

We classify fixed maturity securities in our investment portfolio as “available-for-sale” and report those securities at fair value.

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The allowance for doubtful accounts is based on historical collection trends, future forecasts and our judgment regarding the ability to collect specific accounts.

Premium receivables include the uncollected amounts from insured groups, individuals and government programs.

Premium receivables are reported net of an allowance for doubtful accounts of $ 140 and $ 142 at March 31, 2022 and December 31, 2021, respectively.

Self-funded receivables include administrative fees, claims and other amounts due from self-funded customers.

Self-funded receivables are reported net of an allowance for doubtful accounts of $ 53 and $ 50 at March 31, 2022 and December 31, 2021, respectively.

Premium receivables include the uncollected amounts from risk-based groups, individuals and government programs for insurance services.

Premium receivables are reported net of an allowance for doubtful accounts of $ 137 and $ 142 at June 30, 2022 and December 31, 2021, respectively.

Self-funded receivables include administrative fees, claims and other amounts due from fee-based customers for administrative services.

Self-funded receivables are reported net of an allowance for doubtful accounts of $ 86 and $ 50 at June 30, 2022 and December 31, 2021, respectively.

Other receivables include pharmacy rebates, provider advances, claims recoveries, reinsurance receivables, proceeds due from brokers on investment trades, accrued investment income, and other miscellaneous amounts due to us.

These receivables are reported net of an allowance for doubtful accounts of $ 698 and $ 648 at March 31, 2022 and December 31, 2021, respectively.

These receivables are reported net of an allowance for doubtful accounts of $ 699 and $ 648 at June 30, 2022 and December 31, 2021, respectively.

Revenue Recognition:

For our non-risk-based contracts, we had no material contract assets, contract liabilities or deferred contract costs recorded on our consolidated balance sheet at March 31, 2022.

For the three months ended March 31, 2022 and 2021, revenue recognized from performance obligations related to prior periods, such as due to changes in transaction price, was not material.

For our non-risk-based contracts, we had no material contract assets, contract liabilities or deferred contract costs recorded on our consolidated balance sheet at June 30, 2022.

For the three and six months ended June 30, 2022 and 2021, revenue recognized from performance obligations related to prior periods, such as due to changes in transaction price, was not material.

For contracts that have an original expected duration of greater than one year, revenue expected to be recognized in future periods related to unfulfilled contractual performance obligations and contracts with variable consideration related to undelivered performance obligations is not material.

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2021-01, Reference Rate Reform (Topic 848) (“ASU 2021-01”).

The amendments in ASU 2021-01 provide optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of the reference rate reform.

The amendments in ASU

2021-01 provide optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of the reference rate reform.

The provisions must be applied at a Topic, Subtopic, or Industry Subtopic level for all transactions other than derivatives, which may be applied at a hedging relationship level.

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2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40):

for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”) .

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”) .

The amendments eliminate two of the three accounting models that require separate accounting for convertible features of debt securities, simplify the contract settlement assessment for equity classification, require the use of the if-converted method for all convertible instruments in the diluted earnings per share calculation and expand disclosure requirements.

1 unchanged sentence

We adopted ASU 2020-06 on January 1, 2022 using the modified retrospective transition method, which resulted in an increase to our reported debt outstanding of $ 31 , a decrease to our deferred tax liabilities of $ 8 , and a corresponding cumulative-effect reduction to our opening retained earnings of $ 23 ;

the amounts are not material to our overall consolidated financial position.

these amounts are not material to our overall consolidated financial position.

The adoption of ASU 2020-06 did not have an impact on our results of operations or our consolidated cash flows.

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Business Acquisitions

Pending Acquisition

On November 10, 2021, we announced our entrance into an agreement with Personal Touch Holding Corporation to acquire Integra Managed Care (“Integra”).

Integra is a managed long-term care plan that serves New York state Medicaid members, enabling adults with long-term care needs and disabilities to live safely and independently in their own home.

The acquisition is expected to close by the end of the second quarter of 2022 and is subject to standard closing conditions and customary approvals.

Completed Acquisitions

Acquisitions completed during the year ended December 31, 2021, for which the initial accounting was not finalized as of March 31, 2022, included myNEXUS, Inc.

On May 5, 2022, we completed our acquisition of Integra Managed Care (“Integra”) from Personal Touch Holding Corporation.

Integra is a managed long-term care plan that serves New York state Medicaid members, enabling adults with long-term care needs and disabilities to live safely and independently in their own homes.

The purchase price was allocated to the tangible and intangible net assets acquired based on management’s initial estimates of their fair values, of which $ 89 has been allocated to finite-lived intangible assets, $ 250 to indefinite-lived intangible assets, and $ 110 to goodwill.

The majority of goodwill is deductible for income tax purposes.

Acquisitions completed during the year ended December 31, 2021, for which the initial accounting was finalized as of June 30, 2022, included myNEXUS, Inc.

(“myNEXUS”), a comprehensive home-based nursing management company for payors, and MMM Holdings, LLC (“MMM”), including its Medicare Advantage plan, Medicaid plan and other affiliated companies.

As of March 31, 2022, the purchase price of each transaction was allocated to the tangible and intangible net assets acquired based on management’s final estimates of their fair values, of which $ 1,577 has been allocated to finite-lived intangible assets, $ 20 to indefinite-lived intangible assets, and $ 2,525 to goodwill.

As of June 30, 2022, the purchase price of each transaction was allocated to the tangible and intangible net assets acquired based on management’s final estimates of their fair values, of which $ 1,577 has been allocated to finite-lived intangible assets, $ 20 to indefinite-lived intangible assets, and $ 2,531 to goodwill.

The majority of goodwill is not deductible for income tax purposes.

Adjustments to goodwill arising from contractual purchase price adjustments and subsequent adjustments made to the assets acquired or liabilities assumed during the quarter ended March 31, 2022 were $ 4 .

Business Optimization Initiatives

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Payments ( 10 ) ( 10 ) — — ( 20 )

Liability for employee termination costs at March 31, 2022

Liability for employee termination costs at June 30, 2022

$ 51 $ 47 $ 1 $ 3 $ 102

4 unchanged sentences

Given the inherent uncertainty of changes in market conditions and the significant judgments involved, there is a continuing risk that declines in fair value may occur and additional material impairment losses on investments may be recorded in future periods.

Although not material to our consolidated results of operations, during the three months ended March 31, 2022, we recorded a combination of credit losses, losses on sale of fixed maturity securities and impairments related to our exposure resulting from investments in Russia and Ukraine.

Although not material to our consolidated results of operations, during the six months ended June 30, 2022, we recorded a combination of credit losses, losses on sale of fixed maturity securities and impairments related to our exposure resulting from investments in Russia and Ukraine.

These items are reflected in the tables presented below.

At March 31, 2022, our remaining holdings of Russia and Ukraine fixed maturity securities were not material.

A summary of current and long-term fixed maturity securities, available-for-sale, at March 31, 2022 and December 31, 2021 is as follows:

At June 30, 2022, our remaining holdings of Russia and Ukraine fixed maturity securities were not material.

A summary of current and long-term fixed maturity securities, available-for-sale, at June 30, 2022 and December 31, 2021 is as follows:

Cost or Amortized Cost Gross

1 unchanged sentence

Losses Estimated

March 31, 2022

June 30, 2022

Fixed maturity securities:

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Total fixed maturity securities $ 26,257 $ 830 $ ( 182 ) $ ( 6 ) $ 26,899

For fixed maturity securities in an unrealized loss position at March 31, 2022 and December 31, 2021, the following table summarizes the aggregate fair values and gross unrealized losses by length of time those securities have continuously been in an unrealized loss position:

For fixed maturity securities in an unrealized loss position at June 30, 2022 and December 31, 2021, the following table summarizes the aggregate fair values and gross unrealized losses by length of time those securities have continuously been in an unrealized loss position:

Less than 12 Months 12 Months or Greater

5 unchanged sentences

Fair Value Gross

March 31, 2022

June 30, 2022

Fixed maturity securities:

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Total fixed maturity securities 3,571 $ 8,755 $ ( 131 ) 686 $ 985 $ ( 51 )

Below are discussions by security type for unrealized losses and credit losses as of March 31, 2022:

Below are discussions by security type for unrealized losses and credit losses as of June 30, 2022:

Foreign government securities:

5 unchanged sentences

With multiple risk factors present, these securities were reviewed for expected future cash flow to determine the portion of unrealized losses that were credit related and to record an allowance for credit losses.

Unrealized losses on our other corporate securities were largely due to market conditions relating to the COVID-19 pandemic and increasing interest rates;

however, qualitative factors did not indicate a credit loss as of March 31, 2022.

Unrealized losses on our other corporate securities were largely due to market conditions relating to increasing interest rates and the COVID-19 pandemic;

however, qualitative factors did not indicate a credit loss as of June 30, 2022.

We do not intend to sell these investments and it is likely we will not have to sell these investments prior to maturity or recovery of amortized cost.

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The fair value is expected to recover as the securities approach maturity.

The table below presents a roll-forward by major security type of the allowance for credit losses on fixed maturity securities available-for-sale held at period end for the three months March 31, 2022 and 2021:

Three Months Ended March 31, 2022

Foreign government securities Corporate securities Residential mortgage-backed securities Total

Three Months Ended June 30, 2022 Six Months Ended June 30, 2022

Foreign government securities Corporate securities Residential mortgage-backed securities Total Foreign government securities Corporate Securities Residential mortgage-backed securities Total

Allowance for credit losses:

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Additions for securities for which no previous expected credit losses were recognized — — — — 3 4 — 7

Securities sold during the period ( 2 ) ( 2 ) — ( 4 ) ( 2 ) ( 2 ) — ( 4 )

Decreases to the allowance for credit losses on securities — ( 1 ) — ( 1 ) — ( 1 ) — ( 1 )

Total allowance for credit losses, ending balance $ 1 $ 5 $ 2 $ 8 $ 1 $ 5 $ 2 $ 8

Three Months Ended March 31, 2021

Corporate securities Residential mortgage-backed securities Total

Three Months Ended June 30, 2021 Six Months Ended June 30, 2021

Corporate securities Residential mortgage-backed securities Total Corporate Securities Residential mortgage-backed securities Total

Allowance for credit losses:

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Additions for securities for which no previous expected credit losses were recognized — — — 1 — 1

Securities sold during the period ( 2 ) — ( 2 ) ( 2 ) — ( 2 )

(Decreases) increases to the allowance for credit losses on securities — — — ( 2 ) 2 —

Total allowance for credit losses, ending balance $ 4 $ 2 $ 6 $ 4 $ 2 $ 6

The amortized cost and fair value of fixed maturity securities at March 31, 2022, by contractual maturity, are shown below.

The amortized cost and fair value of fixed maturity securities at June 30, 2022, by contractual maturity, are shown below.

Expected maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay obligations.

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Total fixed maturity securities $ 28,344 $ 26,368

During the three months ended March 31, 2022 and 2021, we received total proceeds from sales, maturities, calls or redemptions of fixed maturity securities of $ 3,646 and $ 5,323 , respectively.

During the three and six months ended June 30, 2022, we received total proceeds from sales, maturities, calls or redemptions of fixed maturity securities of $ 7,026 and $ 10,672 , respectively.

During the three and six months ended June 30, 2021, we received total proceeds from sales, maturities, calls or redemptions of fixed maturity securities of $ 627 and $ 5,950 , respectively.

In the ordinary course of business, we may sell securities at a loss for a number of reasons, including, but not limited to:

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Equity Securities

A summary of marketable equity securities at March 31, 2022 and December 31, 2021 is as follows:

March 31, 2022 December 31, 2021

A summary of marketable equity securities at June 30, 2022 and December 31, 2021 is as follows:

June 30, 2022 December 31, 2021

Equity securities:

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Investment Gains and Losses

Net investment gains (losses) for the three months ended March 31, 2022 and 2021 are as follows:

Three Months Ended March 31

Net investment (losses) gains for the three and six months ended June 30, 2022 and 2021 are as follows:

Three Months Ended

June 30 Six Months Ended

2022 2021 2022 2021

Net (losses) gains:

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Gross realized losses from sales ( 176 ) ( 12 ) ( 254 ) ( 24 )

Impairment losses recognized in income ( 20 ) ( 1 )

Impairment (losses) recoveries recognized in income ( 1 ) 2 ( 21 ) 1

Net realized (losses) gains from sales of fixed maturity securities ( 161 ) 37 ( 239 ) 80

Equity securities:

Unrealized losses recognized on equity securities still held at the end of the period ( 71 ) ( 40 )

Net realized losses recognized on equity securities sold during the period ( 14 ) ( 26 )

Net losses on equity securities ( 85 ) ( 66 )

Unrealized (losses) gains recognized on equity securities still held at the end of the period ( 83 ) 17 ( 154 ) 8

Net realized (losses) gains recognized on equity securities sold during the period ( 5 ) 1 ( 19 ) ( 56 )

Net (losses) gains on equity securities ( 88 ) 18 ( 173 ) ( 48 )

Other investments:

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Gross losses ( 15 ) — ( 44 ) —

Impairment losses recognized in income ( 4 ) ( 8 )

Impairment (losses) recoveries recognized in income ( 1 ) 2 ( 5 ) ( 6 )

Net losses on other investments ( 6 ) 92 ( 16 ) 89

Net losses on investments $ ( 174 ) $ ( 26 )

Net (losses) gains on investments $ ( 255 ) $ 147 $ ( 428 ) $ 121

Accrued Investment Income

At March 31, 2022 and December 31, 2021, accrued investment income totaled $ 185 and $ 205 , respectively.

At June 30, 2022 and December 31, 2021, accrued investment income totaled $ 212 and $ 205 , respectively.

We recognize accrued investment income under the caption “Other receivables” on our consolidated balance sheets.

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We participate in securities lending programs whereby marketable securities in our investment portfolio are transferred to independent brokers or dealers in exchange for cash and securities collateral.

The fair value of the collateral received at the time of the transactions amounted to $ 2,596 and $ 2,155 at March 31, 2022 and December 31, 2021, respectively.

The value of the collateral represented 102 % of the market value of the securities on loan at each of March 31, 2022 and December 31, 2021.

The fair value of the collateral received at the time of the transactions amounted to $ 2,775 and $ 2,155 at June 30, 2022 and December 31, 2021, respectively.

The value of the collateral represented 102 % of the market value of the securities on loan at each of June 30, 2022 and December 31, 2021.

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

At March 31, 2022 and December 31, 2021, the remaining contractual maturity of our securities lending agreements included overnight and continuous transactions of cash for $ 2,408 and $ 1,874 , respectively, of United States Government securities for $ 184 and $ 281 , respectively, and of Other securities for $ 4 and $ 0 , respectively.

At June 30, 2022 and December 31, 2021, the remaining contractual maturity of our securities lending agreements included overnight and continuous transactions of cash for $ 2,527 and $ 1,874 , respectively, of United States Government securities for $ 241 and $ 281 , respectively, and of Other securities for $ 7 and $ 0 , respectively.

Derivative Financial Instruments

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We have entered into various interest rate swap contracts to convert a portion of our interest rate exposure on our long-term debt from fixed rates to floating rates.

The floating rates payable on all of our fair value hedges are benchmarked to LIBOR or the Secured Overnight Financing Rate (“SOFR”).

The floating rates payable on all of our fair value hedges are benchmarked to

LIBOR or the Secured Overnight Financing Rate (“SOFR”).

Any amounts recognized for changes in fair value of these derivatives are included in the captions “Other current assets,” or “Other noncurrent assets,” or “Other current liabilities” or “Other noncurrent liabilities” in our consolidated balance sheets.

The unrecognized loss for all expired and terminated cash flow hedges included in accumulated other comprehensive loss, net of tax, was $ 236 and $ 239 at March 31, 2022 and December 31, 2021, respectively.

During the three months ended March 31, 2022 and 2021 , we recognized net gains on non-hedging derivatives of $ 23 and $ 22 , respectively.

The unrecognized loss for all expired and terminated cash flow hedges included in accumulated other comprehensive loss, net of tax, was $ 233 and $ 239 at June 30, 2022 and December 31, 2021, respectively.

During the three and six months ended June 30, 2022 , we recognized net gains on non-hedging derivatives of $ 24 and $ 46 , respectively.

During the three and six months ended June 30, 2021 , we recognized net gains on non-hedging derivatives of $ 25 and $ 47 , respectively.

For additional information relating to the fair value of our derivative assets and liabilities, see Note 7, “Fair Value,” of this Form 10-Q.

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Such securities are designated Level III.

The fair values of these private equity securities are generally based on either broker quotes or discounted cash flow projections using assumptions for inputs such as the weighted-average cost of capital, long-term revenue growth rates and earnings before interest, taxes, depreciation and amortization, and/or revenue multiples that are not observable in the markets.

The fair values of these private equity securities are generally based on either broker quotes or discounted cash flow projections using assumptions

for inputs such as the weighted-average cost of capital, long-term revenue growth rates and earnings before interest, taxes, depreciation and amortization, and/or revenue multiples that are not observable in the markets.

Securities lending collateral:

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Derivatives presented within the fair value hierarchy table below are presented on a gross basis and not on a master netting basis by counterparty.

A summary of fair value measurements by level for assets and liabilities measured at fair value on a recurring basis at March 31, 2022 and December 31, 2021 is as follows:

A summary of fair value measurements by level for assets and liabilities measured at fair value on a recurring basis at June 30, 2022 and December 31, 2021 is as follows:

Level I Level II Level III Total

March 31, 2022

June 30, 2022

Cash equivalents $ 3,036 $ — $ — $ 3,036

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Total liabilities $ — $ ( 1 ) $ — $ ( 1 )

A reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using Level III inputs for the three months ended March 31, 2022 and 2021 is as follows:

A reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using Level III inputs for the three months ended June 30, 2022 and 2021 is as follows:

Securities Residential

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Securities Total

Three Months Ended March 31, 2022

Three Months Ended June 30, 2022

Beginning balance at April 1, 2022 $ 341 $ 4 $ 37 $ 99 $ 481

Total losses:

Recognized in net income ( 5 ) — — ( 2 ) ( 7 )

Purchases 11 — 190 11 212

Sales ( 188 ) — — ( 14 ) ( 202 )

Settlements ( 5 ) — — — ( 5 )

Transfers into Level III 14 — — — 14

Transfers out of Level III ( 13 ) ( 4 ) ( 9 ) — ( 26 )

Ending balance at June 30, 2022 $ 155 $ — $ 218 $ 94 $ 467

Change in unrealized losses included in net income related to assets still held at June 30, 2022 $ — $ — $ — $ ( 3 ) $ ( 3 )

Three Months Ended June 30, 2021

Beginning balance at April 1, 2021 $ 324 $ 2 $ 5 $ 65 $ 396

Recognized in net income — — — 5 5

Recognized in accumulated other comprehensive loss 3 — — — 3

Purchases 65 — 2 8 75

Sales ( 9 ) — — ( 1 ) ( 10 )

Settlements ( 32 ) — — — ( 32 )

Ending balance at June 30, 2021 $ 351 $ 2 $ 7 $ 77 $ 437

Change in unrealized gains included in net income related to assets still held at June 30, 2021 $ — $ — $ — $ 5 $ 5

A reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using Level III inputs for the six months ended June 30, 2022 and 2021 is as follows:

Securities Residential

Securities Other

Securities Equity

Securities Total

Six Months Ended June 30, 2022

Beginning balance at January 1, 2022 $ 336 $ 5 $ 19 $ 89 $ 449

Total gains (losses):

Total losses:

Recognized in net income ( 4 ) — — 1 ( 3 )

Recognized in accumulated other comprehensive (loss) income ( 2 ) ( 1 ) 1 — ( 2 )

Recognized in accumulated other comprehensive loss ( 2 ) — — — ( 2 )

Purchases 35 — 205 20 260

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Settlements ( 39 ) — — — ( 39 )

Ending balance at March 31, 2022 $ 341 $ 4 $ 37 $ 99 $ 481

Change in unrealized gains (losses) included in net income related to assets still held at March 31, 2022 $ — $ — $ — $ 3 $ 3

Three Months Ended March 31, 2021

Transfers into Level III 14 — — — 14

Transfers out of Level III ( 10 ) ( 5 ) ( 6 ) — ( 21 )

Ending balance at June 30, 2022 $ 155 $ — $ 218 $ 94 $ 467

Change in unrealized gains included in net income related to assets still held at June 30, 2022 $ — $ — $ — $ 1 $ 1

Six Months Ended June 30, 2021

Beginning balance at January 1, 2021 $ 325 $ 2 $ 5 $ 60 $ 392

Recognized in net income — — — 13 13

Recognized in accumulated other comprehensive (loss) income 3 — — — 3

Recognized in accumulated other comprehensive loss 6 — — — 6

Purchases 104 — 2 8 114

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Settlements ( 73 ) — — — ( 73 )

Ending balance at March 31, 2021 $ 324 $ 2 $ 5 $ 65 $ 396

Change in unrealized gains (losses) included in net income related to assets still held at March 31, 2021 $ — $ — $ — $ 8 $ 8

There were no individually material transfers into or out of Level III during the three months ended March 31, 2022 or 2021.

Ending balance at June 30, 2021 $ 351 $ 2 $ 7 $ 77 $ 437

Change in unrealized gains included in net income related to assets still held at June 30, 2021 $ — $ — $ — $ 13 $ 13

There were no individually material transfers into or out of Level III during the three and six months ended June 30, 2022 or 2021.

Certain assets and liabilities are measured at fair value on a nonrecurring basis;

that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments only in certain circumstances.

As disclosed in Note 3, “Business Acquisitions,” we completed our acquisitions of myNEXUS and MMM during the second quarter of 2021.

The net assets acquired in our acquisitions of myNEXUS and MMM and resulting goodwill and other intangible assets were recorded at fair value primarily using Level III inputs.

As disclosed in Note 3, “Business Acquisitions,” we completed our acquisition of Integra in the second quarter of 2022 and the acquisitions of myNEXUS and MMM during the second quarter of 2021.

The net assets acquired in our acquisitions of Integra, myNEXUS and MMM and resulting goodwill and other intangible assets were recorded at fair value primarily using Level III inputs.

The majority of assets acquired and liabilities assumed were recorded at their carrying values as of the respective date of acquisition, as their carrying values approximated their fair values due to their short-term nature.

The fair values of goodwill and other intangible assets acquired in our acquisitions of myNEXUS and MMM were internally estimated based on the income approach.

The fair values of goodwill and other intangible assets acquired in our acquisitions of Integra, myNEXUS and MMM were internally estimated based on the income approach.

The income approach estimates fair value based on the present value of the cash flows that the assets could be expected to generate in the future.

We developed internal estimates for the expected cash flows and discount rate in the present value calculation.

Other than the assets acquired and liabilities assumed in our acquisitions of myNEXUS and MMM described above, there were no material assets or liabilities measured at fair value on a nonrecurring basis during the three months ended March 31, 2022 or 2021.

Other than the assets acquired and liabilities assumed in our acquisitions of Integra, myNEXUS and MMM described above, there were no material assets or liabilities measured at fair value on a nonrecurring basis during the three and six months ended June 30, 2022 or 2021.

Our valuation policy is determined by members of our treasury and accounting departments.

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Our analysis includes procedures such as a review of month-to-month price fluctuations and price comparisons to secondary pricing services.

There were no adjustments to quoted market prices obtained from the pricing services during the three months ended March 31, 2022 or 2021.

There were no adjustments to quoted market prices obtained from the pricing services during the three and six months ended June 30, 2022 or 2021.

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

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The fair value of our convertible debentures is based on the quoted market price in the active private market in which the convertible debentures trade.

A summary of the estimated fair values by level of each class of financial instrument that is recorded at its carrying value on our consolidated balance sheets at March 31, 2022 and December 31, 2021 is as follows:

A summary of the estimated fair values by level of each class of financial instrument that is recorded at its carrying value on our consolidated balance sheets at June 30, 2022 and December 31, 2021 is as follows:

Value Estimated Fair Value

Level I Level II Level III Total

March 31, 2022

June 30, 2022

Other invested assets $ 5,271 $ — $ — $ 5,271 $ 5,271

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Convertible debentures 72 — 687 — 687

During the three months ended March 31, 2022 and 2021, we recognized income tax expense of $ 531 and $ 509 , respectively, which represent effective income tax rates of 22.8 % and 23.4 %, respectively.

The decrease in our effective tax rate from the three months ended March 31, 2021 was primarily related to the tax impact of expected geographic changes in our mix of 2022 earnings.

Income taxes payable totaled $ 395 at March 31, 2022.

Income taxes receivable totaled $ 173 at December 31, 2021.

We recognized the income tax payable as a liability under the caption “Other current liabilities” and the income tax receivable as an asset under the caption “Other current assets” in our consolidated balance sheets.

During the three months ended June 30, 2022 and 2021, we recognized income tax expense of $ 493 and $ 552 , respectively, which represent effective income tax rates of 23.0 % and 23.5 %, respectively.

The decrease in our effective tax rate from the three months ended June 30, 2021 is primarily related to the tax impact of expected geographic changes in our mix of 2022 earnings.

During the six months ended June 30, 2022 and 2021, we recognized income tax expense of $ 1,024 and $ 1,061 , respectively, which represent effective income tax rates of 22.9 % and 23.4 %, respectively.

The decrease in our effective tax rate from the six months ended June 30, 2021 is primarily related to the tax impact of expected geographic changes in our mix of 2022 earnings.

Income taxes receivable totaled $ 332 and $ 173 at June 30, 2022 and December 31, 2021, respectively.

We recognized the income taxes receivable as an asset under the caption “Other current assets” in our consolidated balance sheets.

Medical Claims Payable

A reconciliation of the beginning and ending balances for medical claims payable, by segment (see Note 15, “Segment Information”), for the three months ended March 31, 2022 is as follows:

A reconciliation of the beginning and ending balances for medical claims payable, by segment (see Note 15, “Segment Information”), for the six months ended June 30, 2022 is as follows:

Business Government

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Gross medical claims payable, end of period $ 4,078 $ 10,569 $ 242 $ 14,889

At March 31, 2022, the total of net incurred but not reported liabilities plus expected development on reported claims for the Commercial & Specialty Business was $ 148 , $ 1,217 and $ 2,503 for the claim years 2020 and prior, 2021 and 2022, respectively.

At March 31, 2022, the total of net incurred but not reported liabilities plus expected development on reported claims for the Government Business was $ 270 , $ 1,779 and $ 8,255 for the claim years 2020 and prior, 2021 and 2022, respectively.

At March 31, 2022, the total of net incurred but not reported liabilities plus expected development on reported claims for Other was $ 3 , $ 84 and $ 194 for the claim years 2020 and prior, 2021 and 2022, respectively.

A reconciliation of the beginning and ending balances for medical claims payable, by segment (see Note 15, “Segment Information”), for the three months ended March 31, 2021 is as follows:

At June 30, 2022, the total of net incurred but not reported liabilities plus expected development on reported claims for the Commercial & Specialty Business was $ 101 , $ 673 and $ 3,294 for the claim years 2020 and prior, 2021 and 2022, respectively.

At June 30, 2022, the total of net incurred but not reported liabilities plus expected development on reported claims for the Government Business was $ 223 , $ 869 and $ 9,474 for the claim years 2020 and prior, 2021 and 2022, respectively.

At June 30, 2022, the total of net incurred but not reported liabilities plus expected development on reported claims for Other was $ 1 , $ 21 and $ 220 for the claim years 2020 and prior, 2021 and 2022, respectively.

A reconciliation of the beginning and ending balances for medical claims payable, by segment (see Note 15, “Segment Information”), for the six months ended June 30, 2021 is as follows:

Business Government

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Net medical claims payable, beginning of period 3,281 7,613 195 11,089

Business combinations and purchase adjustments — 375 45 420

Net incurred medical claims:

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Gross medical claims payable, end of period $ 3,633 $ 8,958 $ 230 $ 12,821

The favorable development recognized in the three months ended March 31, 2022 and 2021 resulted primarily from trend factors in late 2021 and late 2020, respectively, developing more favorably than originally expected.

Favorable development in the completion factors resulting from the latter parts of 2020 developing faster than expected also contributed to the favorable development in the three months ended March 31, 2021.

The impact from COVID-19 on healthcare utilization and medical claims submission patterns continues to provide increased estimation uncertainty on our incurred but not reported liability at March 31, 2022.

The reconciliation of net incurred medical claims to benefit expense included in our consolidated statements of income for periods in 2022 and 2021 is as follows:

Three Months Ended

March 31, 2022 March 31, 2021

The favorable development recognized in the six months ended June 30, 2022 and 2021 resulted primarily from trend factors in late 2021 and late 2020, respectively, developing more favorably than originally expected.

Favorable development in the completion factors resulting from the latter parts of 2020 developing faster than expected also contributed to the favorable development in the six months ended June 30, 2021.

The reconciliation of net incurred medical claims to benefit expense included in our consolidated statements of income for periods in 2022 is as follows:

Three Months Ended Six Months Ended June 30, 2022

March 31, 2022 June 30, 2022

Net incurred medical claims:

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Benefit expense $ 28,215 $ 28,777 $ 56,992

The reconciliation of the medical claims payable reflected in the tables above to the consolidated ending balance for medical claims payable included in the consolidated balance sheet, as of March 31, 2022, is as follows:

The reconciliation of net incurred medical claims to benefit expense included in our consolidated statements of income for periods in 2021 is as follows:

Three Months Ended Six Months Ended June 30, 2021

March 31, 2021 June 30, 2021

Net incurred medical claims:

Commercial & Specialty Business $ 6,072 $ 6,718 $ 12,790

Government Business 16,319 16,723 33,042

Other 336 403 739

Total net incurred medical claims 22,727 23,844 46,571

Quality improvement and other claims expense 972 919 1,891

Benefit expense $ 23,699 $ 24,763 $ 48,462

Business Government

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We generally issue senior unsecured notes for long-term borrowing purposes.

At March 31, 2022 and December 31, 2021, we had $ 22,329 and $ 22,359 , respectively, outstanding under these notes.

We have an unsecured surplus note with an outstanding principal balance of $ 25 at both March 31, 2022 and December 31, 2021.

At June 30, 2022 and December 31, 2021, we had $ 22,749 and $ 22,359 , respectively, outstanding under these notes.

On May 16, 2022 we repaid, at maturity, the $ 850 outstanding balance of our 3.125 % senior unsecured notes.

On April 29, 2022, we issued $ 600 aggregate principal amount of 4.100 % Notes due 2032 (the “2032 Notes”) and $ 700 aggregate principal amount of 4.550 % Notes due 2052 (the “2052 Notes”) under our shelf registration statement.

Interest on the 2032 Notes and 2052 Notes is payable semi-annually in arrears on May 15 and November 15 of each year, commencing November 15, 2022.

We used the net proceeds for working capital and general corporate purposes, such as the funding of acquisitions, repayment of short-term and long-term debt and the repurchase of our common stock pursuant to our share repurchase program.

We have an unsecured surplus note with an outstanding principal balance of $ 25 at both June 30, 2022 and December 31, 2021.

We have a senior revolving credit facility (the “5-Year Facility”) with a group of lenders for general corporate purposes.

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Our ability to borrow under the 5-Year Facility is subject to compliance with certain covenants, including covenants requiring us to maintain a defined debt-to-capital ratio of not more than 60%, subject to increase in certain circumstances set forth in the credit agreement for the 5-Year Facility.

As of March 31, 2022, our debt-to-capital ratio, as defined and calculated under the Credit Facilities, was 39.2%.

As of June 30, 2022, our debt-to-capital ratio, as defined and calculated under the 5-Year Facility, was 39.7%.

We do not believe the restrictions contained in our 5-Year Facility covenants materially affect our financial or operating flexibility.

As of March 31, 2022, we were in compliance with all of our debt covenants under the Credit Facilities.

There were no amounts outstanding under the 5-Year Facility, 2021 364-Day Facility or the prior 364-Day Facility at any time during the three months ended March 31, 2022 or the year ended December 31, 2021.

As of June 30, 2022, we were in compliance with all

of our debt covenants under the 5-Year Facility.

There were no amounts outstanding under the 5-Year Facility, 2021 364-Day Facility or the prior 364-Day Facility at any time during the six months ended June 30, 2022 or the year ended December 31, 2021.

Through certain subsidiaries, we have entered into multiple 364-day lines of credit (the “Subsidiary Credit Facilities”) with separate lenders for general corporate purposes.

The Subsidiary Credit Facilities provide combined credit of up to $ 200 .

At March 31, 2022 and December 31, 2021, there were no amounts outstanding under our Subsidiary Credit Facilities.

At June 30, 2022 and December 31, 2021, there were no amounts outstanding under our Subsidiary Credit Facilities.

We have an authorized commercial paper program of up to $ 4,000 , the proceeds of which may be used for general corporate purposes.

At March 31, 2022 and December 31, 2021, we had $ 525 and $ 300 , respectively, outstanding under this program.

In July 2022, we increased the amount available under the commercial paper program from $ 3,500 to $4,000.

At June 30, 2022 and December 31, 2021, we had $ 550 and $ 300 , respectively, outstanding under this program.

We have outstanding senior unsecured convertible debentures due 2042 (the “Debentures”), which are governed by an indenture (the “indenture”) between us and The Bank of New York Mellon Trust Company, N.A., as trustee.

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We adopted ASU 2020-06 on January 1, 2022 using the modified retrospective transition method, which resulted in an increase to our reported debt outstanding of $ 31 , a decrease of our deferred tax liabilities of $ 8 and a corresponding cumulative-effect reduction to our opening retained earnings of $ 23 , eliminating the bifurcation of the embedded conversion option.

During the three months ended March 31, 2022, $ 2 of aggregate principal amount of the Debentures was surrendered for conversion by certain holders in accordance with the terms and provisions of the indenture.

We elected to settle the excess of the principal amount of the conversions with cash for total payments during the three months ended March 31, 2022 of $ 14 .

The following table summarizes at March 31, 2022 the related balances, conversion rate and conversion price of the Debentures:

During the three and six months ended June 30, 2022, $ 13 and $ 15 of aggregate principal amount of the Debentures was surrendered for conversion by certain holders in accordance with the terms and provisions of the indenture.

We elected to settle the excess of the principal amount of the conversions with cash for total payments during the three and six months ended June 30, 2022 of $ 93 and $ 107 , respectively.

The following table summarizes at June 30, 2022 the related balances, conversion rate and conversion price of the Debentures:

Outstanding principal amount $ 89

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As a member, we have the ability to obtain short-term cash advances, subject to certain minimum collateral requirements.

We had $ 275 of outstanding short-term borrowings from the FHLBs at each of March 31, 2022 and December 31, 2021.

All debt is a direct obligation of Anthem, Inc., except for the surplus note, the FHLB borrowings, and the Subsidiary Credit Facilities.

We had $ 175 and $ 275 of outstanding short-term borrowings from the FHLBs at June 30, 2022 and December 31, 2021, respectively.

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

Commitments and Contingencies

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In many proceedings, however, it is difficult to determine whether any loss is probable or reasonably possible.

In addition, even where loss is possible or an exposure to loss exists in excess of the liability already accrued with respect to a previously identified loss contingency, it is not always possible to reasonably estimate the amount of the possible loss or range of loss.

addition, even where loss is possible or an exposure to loss exists in excess of the liability already accrued with respect to a previously identified loss contingency, it is not always possible to reasonably estimate the amount of the possible loss or range of loss.

With respect to many of the proceedings to which we are a party, we cannot provide an estimate of the possible losses, or the range of possible losses in excess of the amount, if any, accrued, for various reasons, including but not limited to some or all of the following:

(i) there are novel or unsettled legal issues presented, (ii) the proceedings are in early stages, (iii) there is uncertainty as to the likelihood of a class being certified or decertified or the ultimate size and scope of the class, (iv) there is uncertainty as to the outcome of pending appeals or motions, (v) there are significant factual issues to be resolved, and/or (vi) in many cases, the plaintiffs have not specified damages in their complaint or in court filings.

For those legal proceedings where a loss is probable, or reasonably possible, and for which it is possible to reasonably estimate the amount of the possible loss or range of losses, we currently believe that the range of possible losses, in excess of established reserves is, in the aggregate, from $ 0 to approximately $ 250 at March 31, 2022.

This estimated aggregate range of reasonably possible losses is based upon currently available information taking into account our best estimate of such losses for which such an estimate can be made.

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District Court for the Northern District of Alabama (the “Court”).

Generally, the suits allege that the BCBSA and the Blue plans have conspired to horizontally allocate geographic markets through license agreements, best efforts rules that limit the percentage of non-Blue revenue of each plan, restrictions on acquisitions, rules governing the BlueCard ® and National Accounts

programs and other arrangements in violation of the Sherman Antitrust Act (“Sherman Act”) and related state laws.

The cases were brought by two putative nationwide classes of plaintiffs, health plan subscribers and providers.

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If approved by the Court, the Subscriber Settlement Agreement will require the defendants to make a monetary settlement payment, our portion of which is estimated to be $ 594 , and will contain certain terms imposing non-monetary obligations including (i) eliminating the “national best efforts” rule in the BCBSA license agreements (which rule limits the percentage of non-Blue revenue permitted for each Blue plan) and (ii) allowing for some large national employers with self-funded benefit plans to request a bid for insurance coverage from a second Blue plan in addition to the local Blue plan.

As of March 31, 2022, the liability balance accrued for our estimated payment obligation was $ 507 , net of payments made.

As of June 30, 2022, the liability balance accrued for our estimated payment obligation was $ 507 , net of payments made.

In November 2020, the Court issued an order preliminarily approving the Subscriber Settlement Agreement, following which members of the subscriber class were provided notice of the Subscriber Settlement Agreement and an opportunity to opt out of the class.

All terms of the Subscriber Settlement Agreement are subject to final approval by the Court.

The deadline for objections to the settlement as well as the deadline for those who wish to opt-out from the settlement was in July 2021 and a small number of subscribers submitted valid opt outs by the deadline.

The deadline for objections to the settlement as well as the deadline for those who wished to opt-out from the settlement was in July 2021 and a small number of subscribers submitted valid opt-outs by the deadline.

The claims deadline was in November 2021 and in excess of eight thousand claims were submitted.

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The notice process was completed in March 2022.

Objections to the supplemental notice along with opt-outs must be submitted by May 2, 2022, with a motion certifying compliance with the supplemental notice due from class counsel by May 10, 2022 .

If the Court grants approval of the Subscriber Settlement Agreement, and after all appellate rights have expired or have been exhausted in a manner that affirms the Court’s final order and judgment, the defendants’ payment and non-monetary obligations under the Subscriber Settlement Agreement will become effective.

The deadline for objections to the supplemental notice along with opt-outs was in May 2022, and a motion certifying compliance with the supplemental notice was filed by class counsel in May 2022 .

If the Court grants approval of the Subscriber Settlement Agreement, and after all appellate rights have expired or have been exhausted in a

manner that affirms the Court’s final order and judgment, the defendants’ payment and non-monetary obligations under the Subscriber Settlement Agreement will become effective.

In October 2020, after the Court lifted the stay as to the provider litigation, provider plaintiffs filed a renewed motion for class certification, which defendants opposed.

In March 2021, the Court issued an order terminating the pending motion for class certification until the Court determines the standard of review applicable to providers’ claims.

In May 2021, the defendants and provider plaintiffs filed renewed standard of review motions, which are now fully briefed.

In May 2021, the defendants and provider plaintiffs filed renewed standard of review motions.

In June 2021, the parties filed summary judgment motions not critically dependent on class certification.

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As a licensed Health Care Service Plan, BCC has paid the California Corporate Franchise Tax (“CFT”), the tax paid by California businesses generally.

Plaintiff contends that BCC must pay the GPT rather than the CFT, and seeks a writ of mandate directing the taxing

agencies to collect the GPT and an order requiring BCC to pay GPT back taxes, interest, and penalties for the eight-year period prior to the filing of the complaint.

Plaintiff contends that BCC must pay the GPT rather than the CFT, and seeks a writ of mandate directing the taxing agencies to collect the GPT and an order requiring BCC to pay GPT back taxes, interest, and penalties for the eight-year period prior to the filing of the complaint.

Because the GPT is constitutionally imposed in lieu of certain other taxes, BCC has filed protective tax refund claims with the City of Los Angeles, the California Department of Health Care Services and the Franchise Tax Board to protect its rights to recover certain taxes previously paid should BCC eventually be determined to be subject to the GPT for the tax periods at issue in the litigation.

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In December 2020, the Superior Court granted BCC’s motion for summary judgment, dismissing the plaintiff's lawsuit.

In November 2021, the plaintiff appealed the order granting our motion for summary judgment.

Our responding brief was filed in February 2022.

We estimate that the appeal will be heard sometime in 2022.

In November 2021, the plaintiff appealed the order granting BCC's motion for summary judgment.

BCC's responding brief was filed in February 2022.

We estimate that the appeal will be heard in the fall of 2022.

We intend to vigorously defend the appeal of this lawsuit.

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, in the U.S.

District Court for the Southern District of New York.

District Court for the Southern District of New York (the “District Court”).

The lawsuit seeks to recover over $ 14,800 in damages for pharmacy pricing that is higher than competitive benchmark pricing under the agreement between the parties (the “ESI PBM Agreement”), over $ 158 in damages related to operational breaches, as well as various declarations under the ESI PBM Agreement, including that Express Scripts:

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In the alternative, Express Scripts claims that we have been unjustly enriched by its payment of $ 4,675 at the time we entered into the ESI PBM Agreement.

In March 2017, the District Court granted our motion to dismiss Express Scripts’ counterclaims for (i) breach of the implied covenant of good faith and fair dealing, and (ii) unjust enrichment with prejudice.

In March 2017, the

District Court granted our motion to dismiss Express Scripts’ counterclaims for (i) breach of the implied covenant of good faith and fair dealing, and (ii) unjust enrichment with prejudice.

After such action, the only remaining claims were for breach of contract and declaratory relief.

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As a result of the summary judgment decision, the only remaining claims as of the filing of this Quarterly Report on Form 10-Q are (i) our operational breach claim based on Express Scripts’ prior authorization processes and (ii) Express Scripts’ counterclaim for breach of the market check provision of the ESI PBM Agreement.

We intend to appeal the decision at the appropriate time, vigorously pursue our claims and defend against counterclaims, which we believe are without merit;

however, the ultimate outcome cannot be presently determined.

In re Express Scripts/Anthem ERISA Litigation

We are a defendant in a class action lawsuit that was initially filed in June 2016 against Anthem, Inc.

and Express Scripts, which has been consolidated into a single multi-district lawsuit captioned In Re Express Scripts/Anthem ERISA Litigation, in the U.S.

Express Scripts filed a second motion for summary judgment in June 2022, challenging our remaining operational breach claims, and we filed an opposition to Express Scripts’ motion in July 2022.

We intend to appeal the earlier summary judgment decision at the appropriate time, vigorously pursue our claims and defend against counterclaims, which we believe are without merit;

however, the ultimate outcome of this litigation cannot be presently determined.

In re Express Scripts/Elevance Health ERISA Litigation

We are a defendant in a class action lawsuit that was initially filed in June 2016 against Elevance Health (fka Anthem, Inc.) and Express Scripts, which has been consolidated into a single multi-district lawsuit captioned In Re Express Scripts/Anthem ERISA Litigation, in the U.S.

District Court for the Southern District of New York.

The consolidated complaint was filed by plaintiffs against Express Scripts and us on behalf of all persons who are participants in or beneficiaries of any ERISA or non-ERISA healthcare plan from December 1, 2009 to December 31, 2019 in which we provided prescription drug benefits through the ESI PBM Agreement and paid a percentage based co-insurance payment in the course of using that prescription drug benefit.

The plaintiffs allege that we breached our duties, either under ERISA or with respect to the implied covenant of good faith and fair dealing implied in the health plans, (i) by failing to adequately monitor Express Scripts’ pricing under the ESI PBM Agreement, (ii) by placing our own pecuniary interest above the best interests of our insureds by allegedly agreeing to higher pricing in the ESI PBM Agreement in exchange for the purchase price for our NextRx PBM business, and (iii) with

respect to the non-ERISA members, by negotiating and entering into the ESI PBM Agreement that was allegedly detrimental to the interests of such non-ERISA members.

Plaintiffs seek to hold us and Express Scripts jointly and severally liable and to recover all losses suffered by the proposed class, equitable relief, disgorgement of alleged ill-gotten gains, injunctive relief, attorney’s fees and costs and interest.

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In December 2021, the United States Supreme Court requested that the Solicitor General submit a brief “expressing the views of the United States” as to whether the court should grant plaintiffs’ writ.

We intend to vigorously defend this suit, which we believe is without merit;

however, its ultimate outcome cannot be presently determined.

In May 2022, the Solicitor General recommended that the United States Supreme Court deny plaintiffs’ writ.

In June 2022, the United States Supreme Court declined plaintiffs’ writ of certiorari.

Medicare Risk Adjustment Litigation

In March 2020, the U.S.

Department of Justice (“DOJ”) filed a civil lawsuit against Anthem, Inc.

Department of Justice (“DOJ”) filed a civil lawsuit against Elevance Health (fka Anthem, Inc.) in the U.S.

District Court for the Southern District of New York in a case captioned United States v.

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The new agreement supersedes certain prior agreements for such services and includes provisions for additional services not provided under those agreements.

Our remaining commitment under this agreement at March 31, 2022 is approximately $ 971 .

Our remaining commitment under this agreement at June 30, 2022 is approximately $ 902 .

We will have the ability to terminate the agreement upon the occurrence of certain events, subject to early termination fees.

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The declaration and payment of any dividends or repurchases of our common stock or debt is at the discretion of our Board of Directors and depends upon our financial condition, results of operations, future liquidity needs, regulatory and capital requirements and other factors deemed relevant by our Board of Directors.

A summary of our cash dividend activity for the three months ended March 31, 2022 and 2021 is as follows:

A summary of our cash dividend activity for the six months ended June 30, 2022 and 2021 is as follows:

Declaration Date Record Date Payment Date Cash

Three Months Ended March 31, 2022

Six Months Ended June 30, 2022

January 25, 2022 March 10, 2022 March 25, 2022 $ 1.28 $ 309

Three Months Ended March 31, 2021

April 19, 2022 June 10, 2022 June 24, 2022 $ 1.28 $ 309

Six Months Ended June 30, 2021

January 26, 2021 March 10, 2021 March 25, 2021 $ 1.13 $ 277

On April 19, 2022, our Audit Committee declared a second quarter 2022 dividend to shareholders of $ 1.28 per share, payable on June 24, 2022 to shareholders of record at the close of business on June 10, 2022 .

April 20, 2021 June 10, 2021 June 25, 2021 $ 1.13 $ 278

On July 19, 2022, our Audit Committee declared a third quarter 2022 dividend to shareholders of $ 1.28 per share, payable on September 23, 2022 to shareholders of record at the close of business on September 9, 2022 .

Under our Board of Directors’ authorization, we maintain a common stock repurchase program.

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Our stock repurchase program is discretionary, as we are under no obligation to repurchase shares.

We repurchase shares under the program when we believe it is a prudent use of

We repurchase shares under the program when we believe it is a prudent use of capital.

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

A summary of common stock repurchases for the three months ended March 31, 2022 and 2021 is as follows:

Three Months Ended March 31

A summary of common stock repurchases for the six months ended June 30, 2022 and 2021 is as follows:

Six Months Ended June 30

Shares repurchased 2.5 2.7

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Stock Incentive Plan s

A summary of stock option activity for the three months ended March 31, 2022 is as follows:

A summary of stock option activity for the six months ended June 30, 2022 is as follows:

Shares Weighted-

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Forfeited or expired ( 0.1 ) 338.54

Outstanding at March 31, 2022 3.2 288.98 7.06 $ 643

Exercisable at March 31, 2022 1.9 238.19 5.87 $ 480

A summary of the status of nonvested restricted stock activity, including restricted stock units and performance units, for the three months ended March 31, 2022 is as follows:

Outstanding at June 30, 2022 3.0 290.27 6.81 $ 586

Exercisable at June 30, 2022 1.8 238.24 5.61 $ 439

A summary of the status of nonvested restricted stock activity, including restricted stock units and performance units, for the six months ended June 30, 2022 is as follows:

and Units Weighted-

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Forfeited ( 0.1 ) 343.38

Nonvested at March 31, 2022 1.3 353.20

During the three months ended March 31, 2022, we granted approximately 0.2 restricted stock units that are contingent upon us achieving earnings targets over the three year period from 2022 to 2024.

Nonvested at June 30, 2022 1.2 355.01

During the six months ended June 30, 2022, we granted approximately 0.2 restricted stock units that are contingent upon us achieving earnings targets over the three year period from 2022 to 2024.

These grants have been included in the activity shown above, but will be subject to adjustment at the end of 2024 based on results in the three year period.

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For a more detailed discussion of our stock incentive plan fair value methodology, see Note 15, “Capital Stock,” to our audited consolidated financial statements as of and for the year ended December 31, 2021 included in our 2021 Annual Report on Form 10-K.

The following weighted-average assumptions were used to estimate the fair values of options granted during the three months ended March 31, 2022 and 2021:

Three Months Ended March 31

The following weighted-average assumptions were used to estimate the fair values of options granted during the six months ended June 30, 2022 and 2021:

Six Months Ended June 30

Risk-free interest rate 1.97 % 1.44 %

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Weighted-average expected life (years) 5.10 5.50

The following weighted-average fair values per option or share were determined for the three months ended March 31, 2022 and 2021:

Three Months Ended March 31

The following weighted-average fair values per option or share were determined for the six months ended June 30, 2022 and 2021:

Six Months Ended June 30

Options granted during the period $ 116.80 $ 79.22

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Accumulated Other Comprehensive Loss

A reconciliation of the components of accumulated other comprehensive loss at March 31, 2022 and 2021 is as follows:

A reconciliation of the components of accumulated other comprehensive loss at June 30, 2022 and 2021 is as follows:

Three Months Ended

June 30 Six Months Ended

2022 2021 2022 2021

Net unrealized investment (losses) gains:

Beginning of period balance $ ( 570 ) $ 589 $ 494 $ 949

Other comprehensive loss before reclassifications, net of tax benefit of $ 355 and $ 108 , respectively

Other comprehensive (loss) income before reclassifications, net of tax benefit (expense) of $ 323 , $( 61 ), $ 677 and $ 46 , respectively

( 1,050 ) 201 ( 2,196 ) ( 125 )

Amounts reclassified from accumulated other comprehensive loss, net of tax (expense) benefit of $( 34 ), $ 7 , $( 55 ) and $ 16 , respectively

Other comprehensive loss ( 1,069 ) ( 362 )

Other comprehensive loss attributable to noncontrolling interests, net of tax benefit of $( 2 ) and $( 1 ), respectively

128 ( 26 ) 205 ( 62 )

Other comprehensive (loss) income ( 922 ) 175 ( 1,991 ) ( 187 )

Other comprehensive loss (income) attributable to noncontrolling interests, net of tax (benefit) expense of $( 1 ), $ 1 , $( 3 ) and $ 1 , respectively

End of period balance ( 1,489 ) 762 ( 1,489 ) 762

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Other comprehensive (loss) income, net of tax benefit (expense) of $ 0 , $ 0 , $ 1 and $( 1 ), respectively

( 1 ) 1 ( 2 ) 2

End of period balance ( 2 ) — ( 2 ) —

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Beginning of period balance ( 7 ) 5 ( 4 ) 5

Other comprehensive loss, net of tax benefit of $ 1 and $ 0

Other comprehensive loss, net of tax benefit of $ 1 , $ 1 , $ 2 and $ 1 , respectively

( 5 ) ( 6 ) ( 8 ) ( 6 )

End of period balance ( 12 ) ( 1 ) ( 12 ) ( 1 )

Total beginning of period accumulated other comprehensive (loss) income ( 178 ) 150

Total other comprehensive loss, net of tax benefit of $ 333 and $ 110 , respectively

Total beginning of period accumulated other comprehensive loss ( 1,236 ) ( 195 ) ( 178 ) 150

Total other comprehensive (loss) income, net of tax benefit (expense) of $ 285 , $( 56 ), $ 617 and $ 54 , respectively

( 916 ) 180 ( 1,979 ) ( 167 )

Total other comprehensive loss attributable to noncontrolling interests, net of tax benefit of $( 2 ) and $( 1 ), respectively

Total other comprehensive loss (income) attributable to noncontrolling interests, net of tax (benefit) expense of $( 1 ), $ 1 , $( 3 ) and $ 1 , respectively

Total end of period accumulated other comprehensive loss $ ( 2,149 ) $ ( 17 ) $ ( 2,149 ) $ ( 17 )

Earnings per Share

The denominator for basic and diluted earnings per share for the three months ended March 31, 2022 and 2021 is as follows:

The denominator for basic and diluted earnings per share for the three and six months ended June 30, 2022 and 2021 is as follows:

Three Months Ended

June 30 Six Months Ended

2022 2021 2022 2021

Denominator for basic earnings per share – weighted-average shares

240.7 244.5 241.0 244.8

Effect of dilutive securities – employee stock options, nonvested restricted stock awards and convertible debentures

2.7 2.9 2.9 3.0

Denominator for diluted earnings per share

During the three months ended March 31, 2022 and 2021, weighted-average shares related to certain stock options of 0.2 and 0.4 , respectively, were excluded from the denominator for diluted earnings per share because the stock options were anti-dilutive.

During the three months ended March 31, 2022, we issued approximately 0.5 restricted stock units under our stock incentive plans, 0.2 of which vesting is contingent upon us meeting specified annual earnings targets for the three year period of 2022 through 2024.

During the three months ended March 31, 2021, we issued approximately 0.9 restricted stock units under our stock incentive plans, 0.3 of which vesting is contingent upon us meeting specified annual earnings targets for the three year period of 2021 through 2023.

243.4 247.4 243.9 247.8

During the three months ended June 30, 2022 and 2021, weighted-average shares related to certain stock options of 0.5 and 0.3 , respectively, were excluded from the denominator for diluted earnings per share because the stock options were anti-dilutive.

During the six months ended June 30, 2022 and 2021, weighted-average shares related to certain stock options of 0.4 and 0.4 , respectively, were excluded from each of the denominators for diluted earnings per share because the stock options were anti-dilutive.

During the three and six months ended June 30, 2022, we issued approximately 0.0 and 0.5 restricted stock units under our stock incentive plans, 0.0 and 0.2 of which vesting is contingent upon us meeting specified annual earnings targets for the three year period of 2022 through 2024.

During the three and six months ended June 30, 2021, we issued approximately 0.0 and 0.9 restricted stock units under our stock incentive plans, 0.0 and 0.3 of which vesting is contingent upon us meeting specified annual earnings targets for the three year period of 2021 through 2023.

The contingent restricted stock units have been excluded from the denominators for diluted earnings per share and will be included only if and when the contingency is met.

Segment Information

The results of our operations are described through four reportable segments:

As discussed in Note 1 “Organization”, we will be organizing our brand portfolio into three core go-to-market brands over the next several years.

Currently, there are no changes to our segments associated with this branding strategy.

The results of our operations continue to be described through four reportable segments:

Commercial & Specialty Business, Government Business, IngenioRx and Other.

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IngenioRx has a comprehensive PBM services portfolio, which includes services such as formulary management, pharmacy networks, prescription drug database, member services and mail order capabilities.

Our Other segment includes our Diversified Business Group, which is our health services business focused on lowering the cost and improving the quality of healthcare by enabling and creating new care delivery and payment models, with a special emphasis on serving those with complex and chronic conditions.

Our Other segment includes our Diversified Business Group, now known as Carelon, which is our health services business focused on lowering the cost and improving the quality of healthcare by enabling and creating new care delivery and payment models, with a special emphasis on serving those with complex and chronic conditions.

This segment also includes certain eliminations and corporate expenses not allocated to our other reportable segments.

We define operating revenues to include premium income, product revenue and administrative fees and other revenues.

Operating revenues are derived from premium and fees received, primarily from the sale and administration of health benefits and pharmacy products and services.

Operating revenues are derived from premiums and fees received, primarily from the sale and administration of health

benefits and pharmacy products and services.

Operating gain is calculated as total operating revenue less benefit expense, cost of products sold and selling, general and administrative expense.

Affiliated revenues represent revenues or cost for services provided to our subsidiaries by IngenioRx and our Diversified Business Group, as well as certain back-office services provided by our international businesses, and are recorded at cost or management’s estimate of fair market value.

Affiliated revenues represent revenues or cost for services provided to our subsidiaries by IngenioRx and Carelon, formerly known as our Diversified Business Group, as well as certain back-office services provided by our international businesses, and are recorded at cost or management’s estimate of fair market value.

These affiliated revenues are eliminated in consolidation.

Financial data by reportable segment for the three months ended March 31, 2022 and 2021 is as follows:

Financial data by reportable segment for the three and six months ended June 30, 2022 and 2021 is as follows:

Business Government

Business IngenioRx Other Eliminations Total

Three Months Ended March 31, 2022

Three Months Ended June 30, 2022

Operating revenue - unaffiliated $ 10,561 $ 23,835 $ 3,566 $ 520 $ — $ 38,482

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Operating gain 806 996 479 86 — 2,367

Three Months Ended March 31, 2021

Three Months Ended June 30, 2021

Operating revenue - unaffiliated $ 9,550 $ 20,066 $ 3,042 $ 621 $ — $ 33,279

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Operating gain 791 868 405 17 — 2,081

The major product revenues for each of the reportable segments for the three months ended March 31, 2022 and 2021 are as follows:

Six Months Ended June 30, 2022

Operating revenue - unaffiliated $ 20,830 $ 47,593 $ 6,867 $ 1,078 $ — $ 76,368

Operating revenue - affiliated — — 6,887 5,441 ( 12,328 ) —

Operating gain 1,888 1,785 877 264 — 4,814

Six Months Ended June 30, 2021

Operating revenue - unaffiliated $ 19,041 $ 39,349 $ 5,780 $ 1,207 $ — $ 65,377

Operating revenue - affiliated — — 6,301 3,680 ( 9,981 ) —

Operating gain 2,059 1,346 812 25 — 4,242

The major product revenues for each of the reportable segments for the three and six months ended June 30, 2022 and 2021 are as follows:

Three Months Ended

June 30 Six Months Ended

2022 2021 2022 2021

Commercial & Specialty Business

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Managed care services

1,532 1,416 3,008 2,802

Dental/Vision products and services

360 335 716 671

Total Commercial & Specialty Business

10,561 9,550 20,830 19,041

Government Business

2 unchanged sentences

Managed care services

102 101 225 202

Total Government Business

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Integrated health services 2,983 2,366 5,930 4,615

315 151 589 272

Total Other Business 3,298 2,517 6,519 4,887

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Managed care products represent insurance products where we bear the insurance risk, whereas managed care services represent product offerings where we provide claims adjudication and other administrative services to the customer, but the customer principally bears the insurance risk.

A reconciliation of reportable segments’ operating revenue to the amounts of total revenues included in our consolidated statements of income for the three months ended March 31, 2022 and 2021 is as follows:

A reconciliation of reportable segments’ operating revenue to the amounts of total revenues included in our consolidated statements of income for the three and six months ended June 30, 2022 and 2021 is as follows:

Three Months Ended

June 30 Six Months Ended

2022 2021 2022 2021

Reportable segments’ operating revenue $ 38,482 $ 33,279 $ 76,368 $ 65,377

Net investment income 381 400 741 691

Net losses on financial instruments ( 151 ) ( 4 )

Net (losses) gains on financial instruments ( 231 ) 172 ( 382 ) 168

Total revenues $ 38,632 $ 33,851 $ 76,727 $ 66,236

A reconciliation of income before income tax expense to reportable segments’ operating gain included in our consolidated statements of income for the three months ended March 31, 2022 and 2021 is as follows:

A reconciliation of income before income tax expense to reportable segments’ operating gain included in our consolidated statements of income for the three and six months ended June 30, 2022 and 2021 is as follows:

Three Months Ended

June 30 Six Months Ended

2022 2021 2022 2021

Income before income tax expense $ 2,143 $ 2,353 $ 4,469 $ 4,529

Net investment income ( 381 ) ( 400 ) ( 741 ) ( 691 )

Net losses on financial instruments 151 4

Net losses (gains) on financial instruments 231 ( 172 ) 382 ( 168 )

Interest expense 208 205 409 397

Amortization of other intangible assets 166 90 295 170

Loss on extinguishment of debt — 5 — 5

Reportable segments’ operating gain $ 2,367 $ 2,081 $ 4,814 $ 4,242

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The information related to our leases is as follows:

Balance Sheet Location March 31, 2022 December 31, 2021

Balance Sheet Location June 30, 2022 December 31, 2021

Operating Leases

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Three Months Ended

June 30 Six Months Ended

2022 2021 2022 2021

Lease Expense

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Right-of-use assets obtained in exchange for new lease liabilities, operating leases $ 29 $ 145 $ 37 $ 160

As of March 31, 2022 and December 31, 2021, the weighted average remaining lease term of our operating leases was 7 years for each period.

The lease liabilities reflect a weighted average discount rate of 2.68 % at March 31, 2022 and 2.69 % at December 31, 2021.

As of June 30, 2022 and December 31, 2021, the weighted average remaining lease term of our operating leases was 7 years for each period.

The lease liabilities reflect a weighted average discount rate of 2.75 % at June 30, 2022 and 2.69 % at December 31, 2021.

Future lease payments for noncancellable operating leases with initial or remaining terms of one year or more are as follows:

2022 (excluding the three months ended March 31, 2022) $ 157

2022 (excluding the six months ended June 30, 2022) $ 109

Thereafter 335

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Total lease liabilities $ 918

As of March 31, 2022, we have additional operating leases for building spaces that have not yet commenced, and some building spaces are being constructed by the lessors and their agents.

These leases have terms of up to 10 years and are expected to commence on various dates during 2022 when the construction is complete and we take possession of the buildings .

The undiscounted lease payments for these leases, which are not included in the tables above, aggregate to $ 41 .

As of June 30, 2022, we have no new leases which will commence during the second half of 2022.

Goodwill and Other Intangible Assets

A summary of the change in the carrying amount of goodwill for our segments (see Note 15, “Segment Information”) for 2022 and 2021 is as follows:

and Specialty

Business Government

Business IngenioRx Other Total

Balance as of January 1, 2021 $ 11,593 $ 8,331 $ 48 $ 1,719 $ 21,691

Acquisitions and adjustments — 2,018 11 508 2,537

Balance as of December 31, 2021 11,593 10,349 59 2,227 24,228

Acquisitions and adjustments 18 112 — 9 139

Balance as of June 30, 2022 $ 11,611 $ 10,461 $ 59 $ 2,236 $ 24,367

Accumulated impairment as of June 30, 2022 $ — $ — $ — $ — $ —

The components of other intangible assets as of June 30, 2022 and December 31, 2021 are as follows:

June 30, 2022 December 31, 2021

Amount Accumulated

Amortization Net

Amount Accumulated

Amortization Net

Intangible assets with finite lives:

Customer relationships $ 5,791 $ ( 3,467 ) $ 2,324 $ 5,598 $ ( 3,236 ) $ 2,362

Provider and hospital relationships 327 ( 138 ) 189 324 ( 129 ) 195

Other 920 ( 202 ) 718 610 ( 141 ) 469

Total 7,038 ( 3,807 ) 3,231 6,532 ( 3,506 ) 3,026

Intangible assets with indefinite lives:

Blue Cross and Blue Shield and other trademarks 5,991 — 5,991 6,299 — 6,299

State Medicaid licenses 1,540 — 1,540 1,290 — 1,290

Total 7,531 — 7,531 7,589 — 7,589

Other intangible assets $ 14,569 $ ( 3,807 ) $ 10,762 $ 14,121 $ ( 3,506 ) $ 10,615

During the three months ended June 30, 2022, we recorded intangible assets related to Integra and also reclassified $ 308 of trademarks with indefinite lives to intangible assets with finite lives - Other, which relates to our new branding strategy.

In addition, the amortization period of certain intangible assets is being shortened to align with the anticipated dates the new branding will take place.

Intangible assets, along with the related accumulated amortization, are removed from the table above at the end of the fiscal year in which they become fully amortized.

As of June 30, 2022, the estimated amortization expense for the year ending December 31, 2022 and each of the five succeeding years is as follows:

2022, $ 745 ;

2023, $ 736 ;

2024, $ 370 ;

2025, $ 312 ;

2026, $ 259 ;

and 2027, $ 219 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements