Anthem, Inc. (ANTM Quick Quote – ) recently announced that it intends to change its name to Elevance Health, Inc. However, again, this will require shareholder approval.

The name change is expected to reflect the expanding business of the leading health insurer. Management sees the rebranding step as critical to its future. It expects ANTM to serve the community through a holistic approach following this new change. Anthem, which has Blue Cross Blue Shield plans in 14 states, will not change its name.

The move will ultimately optimize ANTM's portfolio, which currently serves more than 118 million customers. Name changes and rebranding are nothing new in this space. Earlier, Anthem took on the name WellPoint Inc. after a merger in 2004, until it changed back to its original name in 2014.

One of its peers, UnitedHealth Group, Inc. (UNH Quick Quote – ), separated its UnitedHealthcare division from Optum to streamline its operations. Optum grew to become a brand known for pharmacy care services, nursing services, technology, government services and more.

In 2018, CVS Health Corporation (CVS Quick Quote – ) acquired Aetna and is doing business under the Aetna name.

Coming to Anthem, this change was necessary because ANTM goes beyond traditional health insurance services and penetrates pharmacy, behavioral, clinical and various other areas of healthcare. Its digital capabilities help deliver value-based care to its customers. ANTM continues to see an uptick in the utilization of its virtual care services, which is a significant driver.

Diversification helps health insurance players increase business with high profitability and rapid growth potential.

Shares of the current Zacks Rank #3 (Hold) player are up 38.5% in one year, more than offsetting 33.2% growth. Strategic acquisitions and partnerships, improving revenues, and ANTM's expanded product portfolio should drive long-term growth. As you can see

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The Indianapolis-based player has been benefiting from inorganic growth for years. The Missouri and Nebraska Medicaid programs that acquired WellCare Health in January 2020 also added about 300,000 Medicaid members.

Anthem's acquisition of Beacon Health, the country's largest independently held behavioral health organization, should strengthen its position in the field. Last June, ANTM completed the acquisition of Puerto Rican subsidiaries, including MMM Holdings from InnovaCare Health. In addition, in November, ANTM agreed to acquire Integra Managed Care to expand its Medicaid business. Anthem's strong cash position has driven continued dividend payments and share repurchases.

Stock Consideration

A better-ranked stock in the medical sector is Mednax, Inc. (MD Quick Quote – ).

Mednax provides neonatal, maternal-fetal, radiology, pediatric cardiology and other pediatric subspecialty physician services in the United States and Puerto Rico. MD currently holds a Zacks Rank #1 (Strong Buy) and on average, has had a 27.99% earnings surprise over the past four quarters.