Healthcare Payers: "The real test" quarter – Q2 2026 preview

Research evidence excerpt

Healthcare Payers: "The real test" quarter – Q2 2026 preview

15 July 2026

Healthcare Payers EquitiesHealth Care Providers &

Srvcs

“The real test” quarter – Q2 2026 preview United States

◆ Payer performance has been particularly strong over the last Morten Herholdt*

quarter, from a low base but with a need for operational delivery Global Life Sciences & Healthcare Analyst HSBC Bank plc

morten.herholdt@hsbc.com

◆ Q2 2026 is the real litmus test for payers as to whether easing + 44 20 7992 4082

cost inflation is sustainable in the absence of seasonal tailwinds Rajesh Kumar*

Senior Global Life Sciences & Healthcare Analyst

HSBC Bank plc

◆ We retain our Hold ratings and target prices for both United rajesh4kumar@hsbcib.com

Health Group (USD380) and CVS Health (USD103) +44 20 7991 1629

* Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

Wind at their back: Major health insurers have outperformed YTD. This is led by not registered/ qualified pursuant to FINRA regulations

optimism on margin recovery and policy. Looking past mid-term election risks,

investors continue to debate drug pricing and ACA subsidies but remain supportive of

the sector for now.

Key debates: The industry’s key issues include medical cost inflation vs government

payment rates and PBM reform. Insurers argue that health-care utilisation and cost

trends are still running above what Medicare/Medicaid reimbursements allow.

Although CMS raised MA plan rates, payers say cost inflation remains higher. New

policies tighten Medicaid (federal work requirements and eligibility limits) and require

insurers to pass through rebates to sponsors. In response, PBMs are moving to

transparent, fee-based models trying to eliminate question marks over spread pricing.