Adds company comments in paragraphs 4 and 8

Jan 28 (Reuters) - Elevance Health ELV.N forecast 2026 profit below Wall Street estimates on Wednesday and cautioned that revenue will fall slightly this year, signaling that elevated medical costs will continue to weigh on insurers.

The dour outlook sent shares of the health insurer down more than 5% before the bell.

The company said it expects total operating revenue to decline by a low-single-digit percentage range in 2026, adding to investor concerns after industry bellwether UnitedHealth UNH.N on Tuesday also said its revenue this year would decline for the first time in decades.

The operating revenue forecast reflects a low-double-digit decline in risk-based membership, partly offset by higher premiums and growth in Carelon, its health services business, Elevance said.

HIGHER MEDICAL COSTS

Health insurers have faced persistently high medical costs as demand for behavioral health services and specialty drugs across government-backed healthcare plans has pushed up costs over the last two years.

For the quarter, the company reported a medical loss ratio, the percentage of premiums spent on medical care, of 93.5%, reflecting elevated demand in the company's individual plans, which conform to the Affordable Care Act, also known as Obamacare.

Analysts expected a ratio of 93.39%, according to data compiled by LSEG.

Elevance in October said it anticipated higher costs as members utilize their benefits ahead of expected changes in those plans.

The company expects its 2026 medical loss ratio to be 90.2% plus or minus 50 basis points, which reflects a "prudent view of costs trends".

"We remain confident in our ability to return to at least 12% adjusted EPS growth in 2027," said CEO Gail Boudreaux.

The company forecast 2026 adjusted profit to be at least $25.50 per share, below analysts' estimates of $26.90 per share.

Elevance expects to earn about two-thirds of its adjusted earnings in the first half of 2026.

It reported fourth-quarter adjusted profit of $3.33 per share, beating estimates of $3.10 per share.

Quarterly operating revenue of $49.3 billion missed estimates of $49.82 billion, compared with $45 billion a year ago.