Q4 2025 earnings calls for managed care stocks offered a bevy of insights for early stage operators and investors. Here are some of the key takeaways if you don’t have dozens of hours to listen to the likes of Stephen Helmsley say the word “execution” 1000 times.
For me the big clear reads are:
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Medicaid is getting crushed. There looks to be a real opportunity for solutions to bend the cost curve in areas like behavioral health, high-cost drug spend, and complex care management.
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Payors seem to be ready for enterprise scale AI. Management teams are talking about investing billions into technology with expectations to realize multiples of that in long-term cost savings. I think we will start to see a rapid dispersion among early stage AI vendors. In 2025, a clear theme was seeing a lot of vendors doing similar things all lingering around the pilot phase with large enterprises; this year, I think the solutions proving early ROI will have tailwinds around wallet expansion which could fuel highly capital efficient growth for the early-movers.
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Government funding pressure has to relent at some point. Across categories, we’re seeing more members pushed out of coverage as health insurance becomes unaffordable for patients (e.g. now expired ACA subsidies) or the plans themselves (e.g. MA plans exiting markets with poor unit economics). Something has to give as more people get pushed out of the margins.