Astrana Health Sees Medicaid Membership Falling 10% to 15% in 2027

Astrana Health’s planning factors in a 10% to 15% decline in Medicaid membership in 2027, while President and CEO Brandon Sim believes adjusted EBITDA can grow at a mid-teens pace into that year.

Sim tied the membership outlook to UIS members moving to fee-for-service, work requirements, more frequent eligibility redeterminations and changes to asset limits. During the question-and-answer session, he also said Astrana’s planning did not yet incorporate all California policy developments raised by an analyst.

The growth outlook is not formal guidance for 2027. Astrana plans to provide formal guidance with its fourth-quarter results. Separately, management’s stated medium-term goal is at least mid-teens annual adjusted EBITDA growth.

Third-quarter revenue rose 7% from a year earlier to $1,023.6 million. Adjusted EBITDA, a non-GAAP measure, increased 13% to $77.2 million. For the nine months ended Sept. 30, adjusted EBITDA was $212.4 million, up 39% from the same period a year earlier.

Astrana’s adjusted EBITDA calculation excludes equity-method investment income or loss, certain nonrecurring and noncash items, and stock-based compensation. The measure is presented outside generally accepted accounting principles.

The company narrowed its 2026 adjusted EBITDA guidance to $261 million to $274 million and its revenue outlook to $3.9 billion to $4 billion. Management has cited maturing risk-bearing cohorts, additional conversions to full-risk arrangements, new Medicare Advantage partnerships and operating leverage as growth drivers.

Several new Medicare Advantage payer partnerships in Southern California, Texas and Arizona are scheduled to take effect Jan. 1, 2027. Astrana’s fourth-quarter results are the next stated occasion for formal 2027 guidance.