Alignment Healthcare, Inc. (NASDAQ:ALHC) Q3 2023 Earnings Conference Call November 2, 2023 5:30 PM ET
Company Participants
John Kao - Chief Executive Officer
Thomas Freeman - Chief Financial Officer
Conference Call Participants
John Ransom - Raymond James
Scott Fidel - Stephens
Nathan Rich - Goldman Sachs
Whit Mayo - Leerink Partners
Jessica Tassan - Piper Sandler
Adam Ron - Bank of America
Operator
Good day, and thank you for standing by. Welcome to Alignment Healthcare Third Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.
I would now like to hand the conference over to John Kao, Founder and CEO. Please go ahead.
John Kao
Hello, and thank you for joining us on our third quarter earnings conference call. We are pleased to deliver strong results through the third quarter as we exceeded our outlook expectations across each of our four key performance indicators. For the third quarter of 2023, our total revenue of $456.7 million represented approximately 27% growth year-over-year. We ended the quarter with health plan membership of 115,600 members, growing approximately 18% year-over-year. Adjusted gross profit was $60.6 million, producing a consolidated MBR of 86.7%, while our MBR excluding ACO REACH was 85.7%. Lastly, our adjusted EBITDA was negative $8.4 million, ahead of our outlook range.
Our third quarter's success continues to demonstrate that we are executing against our founding vision of delivering high-quality and low-cost outcomes through our member-first operating model. These include strong performance across three key value drivers; growth, utilization, and Stars. In terms of growth, our strong intra-year membership growth momentum is a tangible sign that our sales and retention improvements are yielding results. Following our third quarter outperformance, we are raising the midpoint of our membership guidance to reflect 20% membership growth for year-end 2023, while also increasing our revenue guidance to reflect 24.8% growth year-over-year.
Further, as I'll share more during our call today, we are feeling confident about our AEP positioning and membership growth outlook for 2024.
Regarding utilization, our MBR results in the quarter reflect continued progress at our clinical operations, improvements to our medical management model, and steady utilization performance. Our provider engagement at Care Anywhere teams, enabled by AVA, delivered 152 admissions per thousand in the third quarter despite absorbing higher than anticipated new membership growth. Lastly, turning to Stars, we are pleased to announce that 92% of our health plan members are in plans rated four stars or above for 2024. This significant achievement is a testament to the quality of our member experience delivered through the seamless relationship between our internal team and our external providers.