MOLINA HEALTHCARE, INC.MOH

MOLINA HEALTHCARE, INC. Fair Value Disclosure

10-KFiled Feb 10, 20262 min read
Fair Value Measurements
We consider the carrying amounts of current assets and current liabilities to approximate their fair values because of the relatively short period of time between the origination of these instruments and their expected realization or payment. For our financial instruments measured at fair value on a recurring basis, we prioritize the inputs used in measuring fair value according to a three-tier fair value hierarchy as follows:
Level 1 — Observable Inputs. Level 1 financial instruments are actively traded and therefore the fair value for these securities is based on quoted market prices for identical securities in active markets.
Level 2 — Directly or Indirectly Observable Inputs. Fair value for these investments is determined using a market approach based on quoted prices for similar securities in active markets or quoted prices for identical securities in inactive markets.
Level 3 — Unobservable Inputs. Level 3 financial instruments are valued using unobservable inputs that represent management’s best estimate of what market participants would use in pricing the financial instrument at the measurement date.
Our financial instruments measured at fair value on a recurring basis at December 31, 2025, were as follows:
TotalLevel 1Level 2Level 3
 (In millions)
Corporate debt securities$2,465 $— $2,465 $— 
Mortgage-backed securities953 — 953 — 
Asset-backed securities364 — 364 — 
Municipal securities159 — 159 — 
U.S. Treasury notes20 — 20 — 
Other
47 — 47 — 
Total assets$4,008 $— $4,008 $— 
Our financial instruments measured at fair value on a recurring basis at December 31, 2024, were as follows:
TotalLevel 1Level 2Level 3
 (In millions)
Corporate debt securities$2,744 $— $2,744 $— 
Mortgage-backed securities914 — 914 — 
Asset-backed securities431 — 431 — 
Municipal securities183 — 183 — 
U.S. Treasury notes5 — 5 — 
Other
48 — 48 — 
Total assets$4,325 $— $4,325 $— 
Fair Value Measurements – Disclosure Only
The carrying amounts and estimated fair values of our notes payable are classified as Level 2 financial instruments. Fair value for these securities is determined using a market approach based on quoted market prices for similar securities in active markets or quoted prices for identical securities in inactive markets.
 December 31, 2025December 31, 2024
 Carrying
Amount		Fair Value Carrying
Amount		Fair Value
 (In millions)
4.375% Notes due 2028
$797 $786 $795 $759 
3.875% Notes due 2030
646 603 645 578 
6.500% Notes due 2031
838 873 — — 
3.875% Notes due 2032
744 682 743 648 
6.250% Notes due 2033
741 764 740 741 
Total$3,766 $3,708 $2,923 $2,726 

Historical Timeline

Fiscal YearFiled
2025Feb 10, 2026Showing above
2024Feb 11, 2025
2023Feb 13, 2024
2022Feb 13, 2023
2021Feb 14, 2022
2020Feb 16, 2021
2019Feb 14, 2020
2018Feb 19, 2019
2017Mar 1, 2018
2016Mar 1, 2017
2015Feb 26, 2016

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

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