Hello, and welcome to Elevance Health's Annual Meeting of Shareholders. Please note that today's meeting is being recorded. During the meeting, there will be a question and answer session. You may submit questions or comments at any time by clicking on the message icon on the meeting website. It is now my pleasure to turn today's meeting over to Elizabeth Tallett, Chair of the Board.
Good morning, ladies and gentlemen, and welcome to Anthem's 2022 Annual Meeting of Shareholders. The meeting is called to order and the polls are now open. Shareholders of record and their proxy holders can vote and ask questions online during the meeting. After the formal meeting, Gail Boudreaux, President and CEO, will provide a business update, followed by a question and answer session.
I will preside as Chair of today's meeting. Joining online are our other directors as well as several key Anthem executives. I will now ask Kathleen Kiefer, Corporate Secretary, to proceed with the meeting agenda.
Thank you, Liz. The agenda and rules of conduct and procedures for the meeting and question and answer session are posted on the meeting website. To conduct an orderly meeting, we ask that you abide by these rules.
As set forth in the rules of the meeting and in our corporate governance documents, the only matters to be acted upon by the shareholders during this meeting are as set forth in the agenda and proxy statement. Alisa Zagare and Catherine Reyes from Computershare have been appointed to act as Inspector of Election for the matters to be voted on during today's meeting.
I will file the oaths of office of the Inspector of Election with the minutes of this meeting. A complete list of our shareholders of record is available for review on the meeting website. Most shareholders have already voted by proxy, and the proxy votes have been tallied.
If you are a shareholder of record or a beneficial shareholder and have already voted, then there is nothing further for you to do. If you are a beneficial shareholder who has requested a legal proxy in attending this meeting, your previous vote has been revoked and you need to revote. Shareholders can vote by clicking on the identified voting link on the meeting website.
A total of 241,235,732 shares of Anthem common stock was outstanding on March seventeenth and entitled to be voted at this annual meeting. Proxies representing approximately 89% of the shares of common stock outstanding and eligible to vote have been received, and thus a quorum is present. As described in the proxy, there are six items to be voted on during this meeting.
The first item is the election of directors Susan DeVore, Bahija Jallal, Ryan Schneider, and Elizabeth Tallett, each to hold office until the 2025 annual meeting of shareholders and to hold office until their successors are elected and qualified. The board recommends a vote for each of the director nominees. The second item is an advisory vote on the compensation of our company's named executive officers.
The board recommends approval of this proposal. The third item is to vote on ratification of the appointment of Ernst & Young as our company's independent registered public accounting firm. The board recommends approval of this proposal. The fourth item is to vote on a management proposal to approve an amendment to our articles of incorporation to change our name to Elevance Health. The board recommends approval of this proposal.
The fifth item is to vote on a shareholder proposal to prohibit political funding. This proposal was submitted by John Harrington, President and CEO of Harrington Investments, Inc. Briana Harrington will act as his representative today. Ms. Harrington, you have three minutes to present the proposal. Operator, please open the line.
One moment.
Will you hear me?
Ms. Harrington, your line is now open.
Okay. Thank you. Good morning. My name is Briana Harrington. I'm responsible for research and shareholder advocacy at Harrington Investments Inc., a 40-year-old Napa Valley, California, ESG registered investment advisor.
This resolution is straightforward in that it requests the board and Anthem's PAC to stop spending money on politicians who can either spend the money on themselves to be elected or reelected or pass it on to their political colleagues to spend it in any manner they wish. There is no going back once you give them the money.
They can vote on any bill or amendment for or against our interests. Not only does the company have no control over the votes of their acquired politician, that politician can pass our contribution along to any other politicians for their vote on any other issue.
There is no assurance that someone bought will vote in favor of our own corporate special interests. Politicians trade votes and give colleagues our money when it is in their interests, not Anthem's. Politicians can also use our corporate money to run for another office that may or may not be helpful to our interests.
Elected officials vote on literally hundreds of issues, many of which may alienate an important customer or shareholder and inevitably not be in the best interest of Anthem. It also leads to public backlash against our company, harms our reputation, and allows the public to believe we have no idea what we are doing or what we are supporting.
The resolution speaks for itself in that our healthcare company gave money to elected lawmakers who opposed the federal constitutional process of approving presidential electors, as well as funded electing politicians in Texas who voted in favor of the Heartbeat Act to deny abortions to women, driving them to unsafe, unhealthy procedures that Anthem covers under our own healthcare policies. Does our governance committee even know what Anthem's interests are?
How many times does this have to happen before Anthem gets it right? Lining politicians' pockets with money isn't the only way Anthem can influence public policy. We've been doing it for years. It's called lobbying. Lobbying is the process to represent our own specific special interests whenever they come up before an elected body, federal, state, or local.
Our governance committee, as fiduciaries, needs to spend more time influencing legislators by setting lobbying policies than supporting political campaigns and politicians and funding and strengthening a corrupt system fueled primarily by corporate money. Please vote yes on this sensible resolution. Thank you.
Thank you, Ms. Harrington. The board recommends against this proposal for the reasons set forth in our proxy statement. The final item is to vote on a shareholder proposal requesting a racial impact audit and report. This proposal was submitted by Trillium Asset Management, LLC along with several co-filers, and Kate Monahan will act as the proponents representative today. Ms. Monahan, you have three minutes to present the proposal. Operator, please open the line.
One moment, please. Ms. Monahan, your line is open.
Good afternoon to the chair, members of the board, management team, and fellow shareholders. My name is Kate Monahan, and on behalf of Trillium Asset Management and the Oneida Nation Elders Trust, I hereby move Proposal Six, which asks Anthem to conduct a racial equity audit.
We, together with numerous other mainstream investors, believe these audits are becoming a new standard in good governance. First, we would like to establish that this proposal has been suggested in the spirit of being proactive and not reactive.
These audits can provide valuable insights by civil rights and racial equity experts related to steps the company is taking. It can also reveal blind spots and assist the company in having a greater positive impact on racial justice. We acknowledge that the company has disclosed efforts in pursuit of racial equity.
The board opposes our proposal on the grounds of having existing programs such that a racial justice audit would not be additive at this time. This is where we respectfully disagree. While Elevance Health has a number of initiatives, including a $50 million commitment to combat racial inequity, without a third-party review, shareholders do not have the assurance beyond management's own assertions that the approach is effective and uses resources well.
Structural racism leads to lower quality care and worse health outcomes for people of color, even when income and insurance coverage is adjusted for. Health insurance companies can play a pivotal role in both perpetuating and preventing that.
For example, data can be an invaluable tool in catching bias, but it can also reinforce it. One widely used health insurance company's algorithm has been found to refer equally sick Black people to care less frequently than white people.
As Anthem continues to dive into AI with its recently announced Google Cloud partnership, it is even more imperative that the company has an independent, holistic view of the policies and procedures in place to monitor how its use of data might unintentionally perpetuate racial disparities.
Racial equity audit proposals have passed this year at Apple and Johnson & Johnson. These first-time majority votes for this type of proposal are a strong indication that a majority of investors believe that even companies that have extensive DEI programs, such as Anthem, would benefit from a third-party review.
Conducting this audit would place Anthem in line with a growing number of companies which have committed to commission such audits, including JPMorgan, BlackRock, State Street, Meta, and Amazon. This is an opportunity for Anthem to establish better accountability mechanisms in addressing racism. We urge our fellow shareholders to vote for this proposal. Thank you.
Thank you, Ms. Monahan. The board recommends against this proposal for the reasons set forth in our proxy statement. That concludes the matters to be voted on during this meeting, and the polls will be closed shortly. I'll turn it back to you, Liz.
Thank you. The polls are now closed. According to the preliminary report provided by the Inspector of Election, the director nominees have been elected, the executive compensation is approved, E&Y has been ratified. The management proposal to amend our articles of incorporation to change our name to Elevance Health has been approved.
The shareholder proposal to prohibit political funding has not received majority support, and the shareholder proposal requesting a racial impact audit and report has not received majority support. We will provide the final voting results in a Form 8-K filed with the SEC. The formal meeting is adjourned. Gail will now provide a brief business update followed by a question and answer session that will last no longer than 30 minutes. Kathy, please review the rules for this session.
We may make forward-looking statements during this session, and actual results may differ materially from these statements. You should refer to our periodic SEC filings for the risk factors related to our business that could cause actual results to differ materially from those forward-looking statements. As mentioned earlier, the rules of conduct and procedures will apply during this Q&A session. Now I'll turn it over to Gail.
Good morning. On behalf of the Elevance Health Board of Directors and our nearly 100,000 associates, welcome to the Elevance Health Annual Shareholders Meeting. As I reflect on the past year, yet another amid the pandemic, I remain proud of the strength and resiliency of our company, and I'm deeply grateful to our associates, especially our frontline clinicians who have served our customers, care partners, and communities with unwavering compassion and dedication.
The work we do each day impacts so many people, and the meaningful difference we can make in connecting people to the care, support, and resources they need has never been more important than during these times.
Our purpose to improve the health of humanity is rooted in our fundamental belief that people are only as healthy as the communities in which they live, and we recognize our important role in ensuring everyone has the opportunity to be and stay healthy. This fuels our commitment to fulfilling our mission to improve lives and communities and our passion to make a positive difference for all those we are privileged to serve.
In recent years, Anthem has been on a journey to transform from a traditional health insurance company to a lifetime trusted health partner. By focusing on whole health and addressing the physical, behavioral, and social drivers that we know are critical to achieving optimal health.
We're dedicated to elevating the conversation about whole health because we recognize that when more people understand the social, behavioral, and physical drivers of health, we can have a greater collective impact on the health of our communities.
Last year, we introduced What's Driving Our Health, a campaign aimed at increasing mainstream awareness of the social drivers of health. At the core of the campaign was the benchmark report Driving Our Health: A Study Exploring Health Perceptions in America, that showed only about half of all Americans realize the impact social drivers like access to healthy food, stable housing, and safe communities have on their overall health, wellbeing, and lives.
That's something we can all try to change. We are also in the early stages of leveraging insights derived from a dynamic model, tracking the health of our communities across local, social, and clinical drivers.
We call it our Whole Health Index, and believe it will help us more closely assess our progress towards helping people live healthier lives. In its simplest form, the Whole Health Index will help us identify the most promising opportunities to improve the health of our members and their communities.
We've already begun to leverage the index to design and launch programs to manage obesity in five of our Medicaid states where this is a significant health issue. We're also connecting our work with communities to drive whole health through efforts to address hunger and lack of access to healthy food, like our initiative to build and transform learning gardens and food pantries in high-need schools.
In partnership with local schools and community organizations in four cities across America, these efforts provide practical, sustainable resources that help increase access to healthy meals, nutrition education, and overall health and wellness for the students, their families, and their communities.
Turning to our business performance and our strategy for the future, Anthem delivered strong financial performance in 2021, accelerated growth across all of our businesses, and made considerable progress towards our strategy to become a lifetime trusted health partner.
For the full year, Anthem reported GAAP earnings per share of $24.73, and adjusted earnings per share of $25.98, reflecting a 16% increase year-over-year. We ended the year with 45.4 million members, up 2.4 million or 6% year-over-year, with approximately three-quarters of those gains coming from organic growth.
The diversity and strength of our business, built upon the most balanced and resilient health benefits portfolio in the market, enables us to deliver on our commitments, advance our strategy, and drive growth for our shareholders.
Across our organization, we're focused on advancing our digital capabilities, improving our consumer experience, and delivering products and services to champion a whole health approach and advance health beyond healthcare for consumers at all stages of their lives.
In our commercial business, where employers have come to expect more, our expanded virtual primary care capabilities now reach 5 million commercial members and expect to reach 10 million members by year-end. We're excited about the potential to expand access to care, especially in underserved and rural areas, while offering convenient, personalized solutions.
In our Medicare Advantage business, packages like Everyday Extras, which offer holistic services such as transportation, personal home health, and healthy prepared meals, are resonating with consumers because they provide the flexibility to choose what matters most to each individual.
For our dual-eligible members with complex and chronic needs, supplemental health plan benefits like those offered by Simply Healthcare address food insecurity issues by delivering food shipments directly to our most vulnerable members.
In our Medicaid business, our health equity and community health initiatives that target vaccine outreach, community health worker readiness, housing stability, and diabetes management during COVID-19, programs made possible by our deep roots in our communities were recognized by the Institute for Medicaid Innovation.
We remain committed to strategic and programmatic M&A and have become more agile and proactive as we target health plans that deepen our existing benefits business, diversify and expand our addressable markets, and align with our focus on driving whole health. Examples include MMM, which has performed well since we acquired them last year, and our recent addition of Integra, a high-performing plan serving Medicaid members with long-term care needs and disabilities based in New York.
These are just a few of the many ways we are evolving beyond traditional healthcare to take a more holistic approach to health and delivering meaningful value to the customers and communities we serve. We're pleased that our shareholders have approved our name change to Elevance Health, which marks an important milestone in our journey to become a lifetime trusted health partner.
Bringing together the ideas of elevate and advance, Elevance Health will reflect our position as a health leader committed to elevating the importance of whole health and advancing health beyond health care for our consumers, their families, and communities. Grounded in our mission and fueled by our bold and ambitious purpose to improve the health of humanity, Elevance Health represents the company that we are today and will continue to be in the future. While our name will change, our focus and commitment are unwavering.
Our work is a privilege and responsibility that inspires our nearly 100,000 associates to deliver their best each and every day. Their passion and dedication to improving lives and communities is inspiring. Last year, our associates generously gave their time, delivering more than 100,000 volunteer hours in support of the communities we serve.
We're pleased to be recognized as one of Fortune's 100 best companies to work for. Moving to 57, up from 71 last year on this year's list of America's leading employers and workplaces. We're also proud to once again be named to Forbes annual list of the top 100 most just companies, as well as the Dow Jones Sustainability Index for our work to empower communities, improve the sustainability of our business, operate with integrity, and advance an inclusive workplace. Thank you for being here, and thank you for your continued interest and support of Anthem. Now we will open it up for questions. Kathy, are there any questions?
Yes, we have received a couple questions and comments. The first is, "Gail, Anthem's customer service currently leaves much to be desired. What can be done to make it easier and quicker to get unauthorized claims voided?
Well, thank you very much for the question. First and foremost, our goal is to be an advocate for our members. We recognize that healthcare can be complicated, and we're looking to simplify the process.
In terms of our overall processes, I'd just like to say that we're working on ensuring we have good relationships with our care provider partners, accurate data, and automating processes so that we can continue to simplify that process. We appreciate the feedback, and again, our focus is on always trying to be the advocate for our member in ensuring that we can simplify healthcare for everyone we serve.
Thank you, Gail. The other comment received is a comment that said, "I would simply like to express the appreciation of the Carpenters Pension Funds, which are long-term Anthem shareholders, for the constructive engagement on important governance issues with the company representatives." We would like to thank the Carpenters Pension Fund as well. That concludes the question and comments we've received. Thank you for attending Anthem's annual shareholder meeting. Have a nice day.
That concludes the meeting. You may now disconnect.