Molina Healthcare (MOH) Q1 FY2026 Earnings Call

Bottom line

The market is missing the Florida Kids contract story - this isn't just another RFP win but a $6B run rate business (15% of total revenue) with 'significant contribution margins' that management is underselling as implementation drag. The obvious headline is the guidance reaffirmation despite a Q1 beat, but the real signal is that Medicaid trend has clearly inflected with Q1 annualized 'better than 5%' yet they won't call it due to 2025 PTSD. The binding constraint remains state funding cycles, but California's retroactive clawbacks ($135M hit) show states weaponizing regulatory tools when desperate. As Zubretsky said: 'Every 100 basis points on the Medicaid MCR is worth nearly $5 per share' - the leverage is massive once trend normalizes. My view changes if Q2 trend deteriorates or more states follow California's retroactive playbook.

The 30-second version

Florida Kids contract is the real story - $6B run rate premium hidden in 'implementation drag' narrative
Medicaid trend inflection finally showing - but they won't call it yet
California retroactive clawbacks signal state desperation - $135M hit should worry other plans

What changed this quarter

Metric	Q4'25	Q1'26	Change
Premium Revenue	$43.1B (+11% YoY)	$10.2B (+flat YoY)	Q1 run rate below 2025 reflecting Marketplace exit
Adjusted EPS	$11.03 (vs $24.50 initial guide)	$2.35	Solid beat vs expectations but still affirming $5+ guide
Consolidated MCR	91.8% FY	91.1%	70 bps improvement despite trend pressures
Medicaid MCR	91.8% FY	92.0%	20 bps deterioration but better than guide
Medicare MCR	92.4% FY	89.8%	260 bps improvement on duals transition
Marketplace MCR	90.6% FY	84.0% (79.5% adjusted)	Pricing discipline paying off with 620 bps improvement
Operating Cash Flow	$(535)M outflow FY	$1.1B	Massive swing on government payment timing
Parent Company Cash	$223M	$213M	Stable with $35M dividends harvested
Days Claims Payable	47	44	300 bps decline due to payment timing, not reserve release
Medicaid Membership	4.6M expected flat	Tracking 6% decline vs 2% guide	California, Illinois, NY driving higher attrition

Accountability tracked

7 new promises made4 narrative shifts flagged7 prior promises scored

Inside the full report

The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.

Read the full MOH Q1'26 report Subscribe

Molina Healthcare (MOH)

The 30-second version

What changed this quarter

Accountability tracked

Follow what management promises next