Cigna (CI) 2 Feb 242023 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by for the Cigna Group's Fourth Quarter 2023 Results Review. [Operator Instructions] As a reminder, ladies and gentlemen, this conference, including the Q&A session, is being recorded. We'll begin by turning the conference over to Ralph Giacobbe. Please go ahead.

Great. operator. Thanks, everyone. morning, Good joining for today's you call. Thank Giacobbe, Ralph Senior Vice Relations. Investor of President I'm the are Eric Health Evanko, this Cigna me of of and line With on Evernorth Executive Chief morning and of Cigna and Officer Chief Executive President Officer and Officer Healthcare; Group's Chief David President Officer; Services. Financial Brian and Chief Cigna the Group Palmer, Chairman the Cordani, Executive

Brian full In our will XXXX today, our and cover including our and David of and XXXX. fourth number results quarter for year a financial topics, outlook remarks financial

Eric Following their prepared will remarks, be for David, Brian and Q&A. available

release, determined As use accordance generally principles in release, as the A in certain income total earnings to from revenues, known with when respectively, shareholders cignagroup.com. the the we of including accepted most the directly earnings otherwise is of United measures contained net measures financial not adjusted reconciliation income results, revenues, GAAP noted measures, in in Investor Relations financial adjusted and operations which accounting GAAP. describing is our and section States, our posted in are these comparable which today's

the today's risks could uncertainties earnings uncertainties to the our actual term earnings expectations. materially share and our statements income to for the and that description our some cause filed making recent the statements our from labeled A reports operations in including in regarding and cautionary is per our as financial future are and risks and to outlook principal XXXX we same with most these subject adjusted basis current performance. of be will SEC. adjusted on from measures performance. In release results contained use note today, We remarks forward-looking of These differ statements,

the quarterly supplement. are million the we in in share. our special charge after-tax item $X.XX quarter, a Pertaining financial or included of special of fourth results, items $XXX recorded net financial per to our Details

in from financial described from revenues today's adjusted income discussion As are of items results. adjusted excluded and our operations release, special in

note including our full that make share a that call comments potential so that, Additionally, we I'll regarding XXXX on when With prospective basis and dividends. please repurchases over we future David. of anticipated year impact outlook, do will includes turn XXXX financial to the the performance,

Thanks, in capabilities, with for partners others diverse as our our year to Ralph. today. our strong delivered with and as was very for work breadth across well consistent businesses. We and morning, access our Good And customers performance and our discipline choice. improve clinical everyone, company and and employer plan our we growth. sustained serve. outcomes clients, continuing expertise joining expand the of health we to thanks for call and executed continue affordability our a with our patients, We XXXX

As momentum XXXX another we look expect into carrying and in year growth. strong we we're forward, of performance

about outlook focus on on our then details our sustain key XXXX Then comments as to of performance last evolve advance to we'll continue I'll today, for growth. year and our Now my through questions. walk we well performance how business impact as XXXX. will take and Brian our for your strategic our additional drivers

We to HCSC. comment our I businesses announcement Medicare definitive to made into Now our I reached sell on this earlier want to the go we before agreement week. results, a

we size following We Group's billion require that in revenue, $XX and we legal Medicare portfolio. concluded see customary Cigna within disproportionate and as growth businesses And expect would at regulatory to an attractive close sustained well the capital investments seniors were focus resources this well their as to about large XXXX, dedicated with the that continue market while and transaction approvals. market, our as in early

business. the customers that Evernorth I serve for Additionally, served agreement, we the grow our as continued be will are for of portfolio, part needs seniors by service would Evernorth's broad to note we continue selling. services high-performing HCSC and with our of will

the Government portfolio expanding Medicare. in we're reach Additionally, of Evernorth's continued growth and significant including services, see opportunities

of in in performance line the the pricing we continued Advantage Medicare consider results we and expectations. the in expansion, were balanced and quarter, XXXX, competitive our fourth business with for market And as target benefits activity. high-quality offerings, Now year, our disciplined

XXXX, per $XX.XX we of XXXX $XX.X with cash headlines. move that, billion. delivered flow and total year Full from our revenue, results performance $XXX.X record consistent positive let's exceeded earnings of our delivering Now billion. into in we track market year share the strength our was Broadly and commitments. financial Full to operations This to the extends the marketplace. for of power the also while to Evernorth conditions. dynamic face expanding lead Health Healthcare, speaks platform the purposeful in constructed in way our we've build on and Cigna franchise It Services needs of continuing shaping way of our adjusted addressing evolving our the company,

goal to XXXX, we discipline each sustained repurchase we've of as Scripts, EPS the over met and past XX% $XX adjusted returned EPS $XX acquisition established dividend the through and adjusted for we've as exceeded and or decade, of Express the by than shareholders focus, delivered year, we've over billion As payments. objectives basis. more well billion an attractive grown combined revenue our on achieved company. Through every share or annualized surpassed years growth a our our since execution, result we've In of X

and In had twice continue than deliver years, commitments was our expectations. enable to year that XXXX, ability grow. that outlook which and to over after increasing full us on EPS short, we of finish over for In many delivered the and profitably a the the we've strong better evolve adjusted we our business year, provide our services EPS demonstrated course to adjusted

million with fulfilling at Centene of XX of million coworkers be contract for the worked greater thousands successfully XXX starting Now benefits begin detail. our so industry. customers in prescriptions dedication, start collaborated Throughout performance Express and our the business, Scripts beginning I'll in XXXX, over I'll ever with to we'd implemented ready year. Evernorth. largest discuss In the single we this well annual pharmacy

to Additionally, clients Centene start. were of a strong to amongst was off ready process XXXX hundreds that and in serve we're additional our

our The of needs clients the team and has the trust in of good of us that meet reinforce our helped the our place company. Centene customers and work

Another advanced spring, once partner well industry-leading that innovation. Evernorth we series as highlight closely for enable to launched again independent support more pharmacies. innovations, transparency additional Last XXXX Rx to affordability, a we broader and is ClearCareRx, choice of as with independent including and

first in pricing. pharmacy Then Express Scripts network model we expanding a launch pharmacy clients for were their an with choice further network. We funding have November, to scaled the cost-based offering benefits Clear

Evernorth and our momentum businesses Accelerated well. with SD our In and as to businesses CuraScript businesses results. Accredo in specialty growth services in line Evernorth's addition, growth fueled bottom top care our strong contributed pharmacy accelerated and

CuraScript specialty high-cost are With patients drugs. with and clinically providers the Accredo SD, and volume supporting of use compliant safe and we effective growing of

care of service continue with also our can also remaining care. care out building patients to platforms access how it, physical and connected We when ensure sense need they while

million XXXX. of MDLIVE is offering now to over platform, over virtual for visits volume and in benefits part the Our XX available growing example, as supporting virtual including million of is X.X care, individuals their

and and flexible governmental clearly with demonstrate organizations health were partner for care capabilities that results plans, health providers. leading Our valued Evernorth's employers,

system. customer employers them us and through Healthcare, care to Sidney pricing individuals revenue serve growth medical guide and We drove through who health the disciplined we management. trust In and cost

use care programs information to to Our equipping and the leading for our vitality. customers with clinical insights and them need support best the patients, choices health could and they right make their

resulting in continued a pricing XXXX in in and ongoing than initiatives ratio care progress affordability Our better that was expectations. medical

and our outstanding care digitally an This year position services growth. Our affordability enabled networks was and team's business coordination in continued with improved U.S. as our Commercial competitive success continued we by had high-performance value. expand our and of overall driven Employer care strong access, strengthening through leveraging

for performed we've the Our with deliver in taken, on individual improved XXXX. we business in expectations exchange fourth And the line with to broadly actions track quarter. are profitability our

bottom In health, achieved another top results. international and line we positive

employees Our well supported localized of our the and by network intergovernmental globally resonate to as and corporations multinational very solutions, well as global health mobile with provider organizations. high-quality population continue

Now turning XXXX. to

We clear businesses with of greatest high sustain framework. in the focusing portfolio opportunities on a growth well-balanced complementary sharply growth strategic will performance our durable and by a

will high-performing growth foundational businesses. benefit, predictable we steady commercial international our drive U.S. our and growth health continued employer from Pharmacy First, business.

Our clients well loss drugs as the example, expertise in and pharmacy for prescription for diabetes. in our high depend needs our cost weight demand on class addressing GLP-X and such as of as growing leadership for lowering our services, drugs for the

more new supporting support additional long a and continue specialized providing efforts have guiding to Employer in as growth their these on of our value our the understand clinical been than EnCircleRx better and and them in programs we by Commercial to program. to benefits. medications help history ways, including a continue for such to for offering as successful customers Group. We a U.S. also access this view growing build tools appropriate digital will Cigna decade the with We're enhanced pharmacy of We've market business

number leverage clinical for solutions for growing We continue a and strength of outcomes in clients point coordinating clients. improving to our the our

act and Additionally, continue disruptive to we as small middle-sized a client needs. for innovator

momentum fast-growing further portfolio, growth scaled service care will we Second, our our pharmacy and accelerated businesses. our for on specialty build business

treatments. and tremendous large with have patients with supporting complex high expanding our cost clinically these capabilities, We specialty opportunities markets differentiated in and

of end targets. coordinated care virtual capabilities Care flow and within and care for base specific our least full the programs grow flow. summary, our operating long-term XXXX, conditions. generate cash dividend. We've $XXXX, consolidated in XX%, to for And at expect health, revenues increased and expectations Services, will revenue year at for we higher grow our billion strategic capital EPS we're we home as behavioral our quarterly and at to In to well shareholders, again our we our customer continue as to will earnings we least cash of advancing return to and $XX expect our including XX% adjusted in increase our XXXX a And adjusted at operating least

President Brian the our also well as the mention is before lucid further last turn month as about also we Cigna and expanding continue it Chief as wanted his President Vice wrap as role. Healthcare. past Now to and leadership provide President years Group, of Eric's clarity Cigna CEO as for strategy for in the announcement we has and He been Brian Evernorth to Eric responsibilities of while I our Officer X CEO continuing as and for positions impact of also that and have. up I expand reach changes to of expanded the his priorities Eric. Enterprise and Brian, over of it will will other Services. well and Financial announced responsibilities as expanding Brian Strategy roles Executive made and extent

from City, look we across York our you'll the it more advance Brian Importantly, our addressable Investor bench. other to reinforces you company. our as leaders see also from depth our the Signet attractive the me, how on We hear sharing well management as positioned New key with and At markets views Group X forward growth. next we've March of chapters our Eric, expanded of Day and of to in

briefly summarize. Now I'll

With are the of EPS momentum in we for carried XXXX. we guidance our raising out XXXX,

We customers was performance our $XX.XX, billion for are above and EPS across we and operations. of disciplined building outlook, kept which deliver We $XX.X growth execution, generated of our from of cash and on adjusted strong XXXX shareholders, commitments including partners. a and to year delivering our flow clients our our company. for We

year positioned of to portfolio ensure sharpened are our we the company. for have focus We strong further our drive another to that

of track We using least outlook advance will discretionary now the execution, flow of for disciplined continue We've building share in repurchase our to differentiated cash the XXXX consistent majority EPS our of and expect partnerships. capital, increased a and at and XXXX. $XX.XX, innovation deployment we of are for including strategic on record

our We'll that, track of continue EPS than record of long-term while over adjusted strong to more an Brian. decade have against year XX% XX% to a performance, I'll attractive growth turn And target dividend. another for our delivering with maintaining it

year Group's the Group, Good XXXX. our We're for reflecting and execution full fourth Today, Cigna deliver XXXX Cigna and proud Cigna review provide quarter to for results David. strong Evernorth year I'll and full another and focused outlook Thank growth Healthcare. year across everyone. the morning, you,

billion, reflect highlights billion, for of from include $XX.X us expectations Fourth well $XXX.X earnings Looking for to share after-tax with particularly momentum quarter at full well XXXX. billion, strong per adjusted to revenue flow $XX.X initial XX% the were financial growing positions growing of growing $X year and growth adjusted earnings $XX.XX in the earnings broad-based $X.XX. across company, share cash to These adjusted key strength XXXX, this enterprise consolidated of revenue exceeding all results operations and our year. per and billion, results some

on comment of I'll Regarding platforms, and our growth in profitability sustained Evernorth. growth another Evernorth. marked year XXXX first

As and health to market-leading continue and our clinical employer solutions customers. for innovative our plan, differentiated capabilities create and value government, clients

GLP-X Fourth expectations. saw Evernorth's and which specialty to conditions. pretax our for revenues unwavering year clinically reach continued a in come XX% costs clients revenues Evernorth new were and to And specialty $XX.X biosimilars, therapies exceeded in grew $XX of billion the business, by growth quarter reducing XX% adjusted which strong XXXX quarter year-over-year for generics emerging performance $X.X agonists, to billion, revenue focus pharmacy full on drug our XXXX. driven to grew complex market, including net as results double-digit billion earnings our other both innovations for in

favorable and earnings across incurring above full pretax foundational achieved while spending our related of earnings expansion expectations. year, with Evernorth for Scripts Centene XXXX, to adjusted X% accelerated XXXX the specialty growth strong the in reflected our strong scaled business, execution a revenue capped Evernorth's quarter for Accredo even pharmacy. adjusted business, relationship. We growing and meaningful this fourth and Express implementation our year The growth

execution. to care growing $XXX were year-over-year earnings Cigna expectations representing ratio effective billion outperformed to earnings reflecting X%, another year were Fourth pretax million, with was full turning and of growth. Now revenues adjusted pretax adjusted favorable medical adjusted year The XXXX $XX quarter XX.X%, We strong expectations. XXXX Healthcare. highly

due business, to U.S. ratio on stop-loss particularly cost driven care which lower dollar expectations high favorability Commercial primarily claimants. products, trends medical outperformed by Our our within was Employer our

the lower-than-expected RSV running we the saw of flu, combination below viral Additionally, with costs COVID quarter in and projections.

As our definitive David his sell comments, a noted Medicare entered we in to have with agreement businesses. HCSC

Medicare this to assumes approvals. close outlook We our full early regulatory businesses. contributions in XXXX, from year year expect transaction And XXXX full following our

expectations, business our with For was of better specifically, generated affordability Cigna XX.X%, Across our XXXX execution, disciplined pricing Advantage benefiting Medicare expectations. line performance fourth our year in than quarter ratio continued of broadly full initiatives, from Healthcare, care medical and products. basis year XXXX. XXXX MCR XX.X% the was in points Loss guidance, an and Stop full the our is XX favorability year from of full basis our XX better than initial The midpoint points improvement

year-end initial primarily customers, U.S. by Moving We was million XXXX ahead to of customers. commercial This X.X of XXXX, growth growth medical well in approximately and total XX.X U.S. XX% customers, as medical Cigna Healthcare our growth as ended with or guidance. fee-based from care individual from driven million exchange employer Advantage. health Medicare

to with continues strong Healthcare perform well fundamentals. Cigna underlying

the results of focused of our as XXXX our reflecting our This the reflect and stability in of consistency beyond. execution. strength and results across market market. strong commercial the platforms growth business momentum intentional XXXX Overall, and company's with very for design provides environment, Our a disciplined ongoing differentiated employer value the the execution U.S. considerable proud us we're as the of proposition disruptive well and

year specifically. full outlook our XXXX, to for turning Now

in continue growth care. and Health Cigna We to underlying expect Evernorth strong

least of to per our at income full expect adjusted least billion, we similar least adjusted pattern XXXX. and expect prior consolidated adjusted be year billion per to considering from the would seasonality, earnings full XXXX expect $X.XXX be revenues When year an operations earnings to XXXX $XXX at or at share, We from increase consolidated share $XX.XX outlook. we

platforms. growth at At our of least to full Evernorth, each XXXX year outlook our adjusted turning earnings XXXX of expect Now billion. for we $X

Evernorth adjusted ramp full XX% We adjusted first year of we earnings. to throughout contributing within quarter earnings with adjusted slightly earnings expect as the move Evernorth below year

reflects the of of and course the spend. the first half concentrated the taper of more the investments over onboarding effect year early The ramp off year. These earnings in client-specific year are

we at XXXX Cigna earnings year full billion. $X.XX adjusted expect For Healthcare, least of

care care to our the in range year include end in Healthcare Cigna guidance medical at and and ratio million medical full we XXXX ratio XX.X% expect XXXX outlook low Assumptions for the to reflect the to XX.X%, year-end, XX.X medical of customers be patterns. range seasonal expected of the below approximately with quarter typical total to be first our

X.X% reflecting Additionally, And ratio to adjusted of higher expect SG&A enterprise rate XX%. we XXXX, an revenue enterprise, consolidated lower range which project proportion carries we approximately ratio. a for tax Evernorth, SG&A from of be in XX.X% to a for adjusted the the of the

billion, Turning $X.X and delivered management and from to strong dividends. we shareholders capital billion via XXXX our finished repurchased approximately $XX.X We position of to common XXXX and returned XXXX capital X.X cash shares for flow In million XXXX, outlook. $X.X billion stock of we operations.

XXX year-end from Additionally, ratio the improvement our approximately debt-to-capital at XX.X% an finished XXXX. year and points basis of

framing capital Now XXXX our outlook.

flow least from $XX efficient deliver of through business billion service-based at expect operations model. cash to We our

to to XX% to expenditures, capital share dividends, approximately increase shareholder $X.X and billion share, a per basis. on a quarterly deploy reflecting our dividend $X.X we expect approximately $X.XX deploy to We per expect of billion

intend In for our repurchase. share to XXXX, discretionary we of use majority a cash flow

we least As to repurchase shared, of previously $X billion we within half the XXXX. at first anticipate

range average shares. be Finally, to we of $XXX weighted million year shares outstanding to in full million the XXX expect

recap. to Now

full Our across growth our across And continued care. outlook Evernorth reflecting and year exceeded strength consolidated and and discipline expectations, Cigna focused platforms, HealthCare. Cigna XXXX momentum execution Health Evernorth our X reflects results and continued XXXX

to are the call. And least at the we'll for in to $XX.XX full share. Q&A earnings deliver operator XXXX adjusted with our We the turn per of portion confident year that, it ability over of

from UBS. A.J. [Operator Instructions] with first Our comes Rice question

as to been the have Advantage in business, of some still Obviously, your yet players the of sale market on is the segment volatility you comments the you view Medicare to from settle? other some still saying should in sort the mind the time for of attractive. of announced. how there's the space interpret business think that some performance already Or we and give some announcement you're attractive? this dust of this that your Obviously, we the and step in the Is time back

there at deal the And press discussions. about a then also in least is on that, obviously, speculation

Your people give you should keep was you us large of stock wonder that quite reassuring in if parameters the on some would transactions, could volatile. how approach mind hopefully for a them. little I bit that be financial

It's David.

question, lot it. I appreciate a have in You that and

the to high Let some of address try me points.

our portfolio. we able it's with transaction of strategy First see We really the it within pleased win-win. foremost, clarification our we're are HCSC. a And the as to with to structure nature and a

Evernorth record it As partners health elevated I it while was regulatory we've value for size services, resources decision capital as proposition very Medicare, this portfolio we're as et to it be reach with best several been the view services transaction. within of years, our growth attractive for our proven and the track an required noted quite it go-forward us. on market. was a Medicaid, investment environment, trajectory that attractive in enter to growing basis relative the X market for and that fuel we my and The cetera. to government prepared continued deliberate it will is, remarks, be attractive their an to focus coupled plan very our we be portfolio, expand duals, now working as within demonstrating a its to Point And franchise, importantly, but see the relates continue government through service the

the make As M&A our want capital in part sure that your criteria. put it criteria. of I'll relates context to of to question, I deployment reframe your latter I our

our referenced Brian investing We the deployment billion. of in view, capital CapEx deployment priorities, first, business. about to $X.X continue

capital in capital appropriate year. shareholders. we third, M&A moment. least to I'll we expect in at to of the half its back $X in which Second, by addition share as excess always come a noted, And returning XXXX, shareholders repurchase raising to Brian the XX%, the And majority for then to evaluate to through our return with in billion first dividend our of attributes,

attraction; your then transactions, second, first, action criteria to pack X path and we in question, attraction; clarity. overall criteria: for as about third, about Lastly, strategic think financial think the we

But each a a organization So is And as about in equation, terms enter Is value own visibility transaction. seeking think note, its deal evaluate respective into merits. you're on financially piece final it to when get financial to your strategically you it of of the going attractive? creation high aligned? the your for we if

the repeat, with to we're decision the So pleased transaction and design.

strong service a our further as will and to in within Evernorth. attractive the visibility continue portfolio capital will And the discipline grow with this priorities capital past, high deployment portfolio. quite long-term way an record clear. that as expands We relationship capital-light deployment we XXXX HCSC track we our have service are for We very proven in see Evernorth maintain

Our Baxter Fargo. comes Stephen from Wells question with next

wanted the ask on kind another quick to I Medicare Advantage. just follow-up of

XX-year So be you'd I would your market. the be of maybe share curious or view X- to if willing

are the that you the I it's totally today? your could kind like is of look still the share than love Do in of largest much going market market medium-term the market. the concentration country. more plan it thoughts appreciate part But before any think So does a in you and Would small ultimately eighth business sale. you offer to commercial

David. it's Steve,

You're asking crystal for a XX-year ball.

And overall in Advantage come delivering think people terms to the has outcomes marketplace, for with views positive. But it for typically higher a a first coordination. the get necessary when X-year to value offering, in of dynamism the of foremost, outcomes, outcomes, of the attractive the a marketplace and of quality seniors. very are burden dealing that's importantly, record the most in clinical broadly And back, market. given benefits. Medicare the offering attractive Medicare you I stepping And proven of long-term track speaking, level is rolling clinical back a the beneficiaries, coordination care

financially supported standpoint, broadly a grow. from to an societal speaking, to U.S. the see for be we continue MA and important So as served, asset

flows letter a moment time, at funding acceleration rate will and at of That's the terms Secondly, time. for deceleration mechanism. potentially the in or in see the We moment look see either the marketplace. early ebbs in marketplace the that

to as is Advantage. to senior A.J.'s we health support integrated to it really continue Therefore, providers broad will point, the portfolio the the broadly Advantage be attractive noted and we ensure worked satisfaction and of care, care in Net Promoter services for level, tools have we support a you Third commercial or aggressively that I value-based Score at is, Medicare broadly if plans value-based of broaden NPS of for to be look Medicare population. -- in

boomer as ebb growth has that as wave And the So depending It's growth and still Evernorth. the on the its market. ultimately, and whole, toward reached primary this but opportunity will a the from of baby aging respective comment flow it benefit Its an reimbursement a some peak as we we peak I last and marketplace make attractive, know, slowing then has would the expansion is to lending Take level wave is see richness. you a for is reached somewhat. slowing. primary as see government,

with Lisa question JPMorgan. from next comes Our Gill

key to I of maybe just about understand Evernorth think focus drivers as XXXX. on the want and we some

in but 'XX? an on you're first your bit big specialty in talk what You off, you selling expectations So you But services? CNC little in around about touched talked about also What board, are had with season. coming contract had 'XX. GLP-X. good you doing about specialty on overall really growth Can XXXX a a you

the the what drivers help understand to us that So strong as Evernorth. growth AOI in elements can you for any to of are key

we're his transition solutions just growing. noted administered for But the the some burden that around let of David of But I are of we're we of Evernorth fragmentation Eric. care that some that terms plans in highlights from talk how Thanks, specifically first, teams interest in along and seeing of different in coordinate comes Lisa. me is assembling are XXXX. and there. call and prepared alleviate the services the portfolio remarks, on a into would A of and how about growth out, with of pieces It's focused bit better market helping a couple employers the individual capabilities to couple point drivers significant care. of on

to So navigation reduce solution a us point is working key fatigue item. improve and

and area health behavioral there's better challenges. there's an along care of with of address continues in opportunity behavioral for would with meaningful I position to Second we're us journeys, other be all, care help needs, significant focus, those individuals a be care mental comorbidities to and with coordinated note, to as

The to in be particular, are third item and continue Overall, as around I'd really well market navigating grow affordability through for biosimilars. therapies, positioned choice drive opportunity as note the as there to in specialty to continue us we're more more that's to overall. specialty in the an biosimilars. would well And then about economics we've Evernorth choices a as is the in and overall. growth long-term and in proposition growth previously, factor an GLP-Xs multiyear of therapies talked are tailwind our And important that's continued area the like in the certainly,

continued and So we're our us that the got to numbers that of a on talking of put as Overall, deliver lives suite number ourselves you beyond. positioned number continue enable touched about. to excited about the well into had really we're that going serving. XXXX capabilities. of ends and different we've kind in you clients' lives trajectory see put growth the When in there -- the together momentum deliver that up capabilities, we've really growth that the together of being a attractive that portfolio

with Our George comes Bank. next Hill question Deutsche from

as a for questions just relates guess I and it for couple 'XX. clarifying the of to MLR guide me

You guys by want Can just line as you're asset of held the have it's for to cost MA is And 'XX kind the carried because you of I I disaggregate there? business what bumped up that confirm of medical of the kind expectations. seeing being footnotes the for still sale. an in the continuing guidance of in included ops kind saw MLR kind in business

kind expectations and trends medical it expectations of disaggregation a just cost of like for So of kind 'XX.

George, Brian. it's

and then the MCR. just question first M&A So the take let me get I'll into

noted reported Medicare will business Advantage through to as the through in earlier, Cigna So Healthcare my XXXX. continue comments be

the volume through whether guidance, guidance, held-for-sale So Medicare business the be basis. guidance revenue the customer the our will assumes that on all continue reported to of asset earnings be guidance, Healthcare that all Cigna an

So just clarify that. to

you all metrics that the line see up basis. So with that

favorable XXXX. the in the uptick the our the really we specifically, favorable driver and And step MCR full MCR early back the XXXX. of thank now coming in the in Healthcare a full year had were and of slight of expectations outperformance. was mentioned has where pleased points we income the expectations. And guide better earlier, performance just was MCR to basis Within both primary obviously We're year XX with started to from and XXXX midpoint or the than to midpoint guidance quarter the where Cigna as XX.X% I

projected Commercial XXXX driver So primary of you MCR the products of the Employer within U.S. can the business. slightly as higher stop-loss our think being

ran our As in target XXXX. I to in mentioned trends earlier, due profit favorable cost to lower-than-expected these claimants. high-dollar margins And

assumptions planning typical range. into profit are back margin stop-loss the their our XXXX, products target for to For normalize

within XXXX and Secondarily, overall MCR. will the Cigna there is Health some the portfolio care XXXX product Healthcare impact that mix shift Cigna between

of targeted X% start note end to our Although the off to then as level compared and finally, XX% appropriate to always, I Cigna we'd our expect about Healthcare to guidance percentage XXXX, expect MCR to margin of that would have range does an in the prudence XXXX. XXXX guidance, land that our low year. higher you profit And near when overall think we be the in

with Raskin Josh from comes Nephron question next Research. Our

Medicare have divestiture. I Why in would have the wanted Corp. Evernorth to value allies the tie-in mean have that Advantage value-based I that that side Healthcare asset of more similarly, included an you sort business? thought And including PDP to development the was strategic and the Care well, was that, for get what to sale? would that back Services the had on as structure. that Cigna? cost network at care broad does advantage And on a then

Josh, it's David.

it piece of Eric going come of the your BBC, in expand. Let allies at of terms then I'm cetera. question latter me care ask et take to And and portion a to and

MA specifically is about care. is your First, care focused Think allies of the correct. value-based statement on the portion

So there's Stepping on therefore, back, there. alignment care. value-based

have our exchange, a for We and orientation results patients and value-based off proven benefit positive Advantage. individual history Medicare delivering a long strong well track the for record clients, for our customers of commercial, as very our care again, of as of for

model, conversations, been and model broadly partner As an from prior speaking. as that's you our to a know opposed owned enabled

enabling. partnering versus owning of In delivery terms the care

ask around you think to the about continuing. I'd that Additionally, commitment

our including our exchange for of we So and Village. our around business continues, delivery collaborative Care partnership accountable That health our our system care. and of expansion business as Evernorth with partners continues and care Accountable their in our care strategic value-based support commercial investment capabilities on relationships

So multidimensional on in and care direction business. Advantage value-based talk relative assets to strategy to the our ask change Medicare specific to the this I'll PDP of for of side about Eric? no equation, us. the the services Eric was relationship there. solely our subset aligned

Thanks, David.

Josh I would things X for So note you, here.

had in Brian will a First a as all, building Evernorth remarks, prepared David exists HCSC their services relationship have on of that we between multiyear and there. and already relationship

not with Evernorth to the associated clinical coordination some prescription the have business, drug and continue related will other the of provide but capabilities. services opportunity only of So to element this

So we're excited about together. working that to opportunity grow

to going and all and the services to in Specifically Express continuing is of we'll this that be think very will played a will But and seamless dynamics insurance of of being manage with the relationships employer of here clients continue Ever us. Scripts and be employer an to face management the again, will be item, our PDP be and involved relationship continue here with around for focus that to role North to this the set the from account offerings area you should HCC. of a perspective,

about here. I'm to very continue Overall, opportunity So grow partner to another excited with the

Our Stephens. next question from with comes Scott Fidel

investment growth for Healthcare invested in you've you may the obviously, Cigna just a your how Interested about sale change the business, and lot with that? now MA for Medicare. in from And how of priorities talked

invest free to should that in up So businesses. other capital

increase now but just So Healthcare thinking exchange more Cigna can text, the about growth Cigna also around you which is weighted how for you're risk in terms a how Healthcare, now thinking your investment you're curious business be in overall against volatile from will of where probably business towards exit about business. in the pretty just

how curious going post and now view of So thinking to sort exchange just you're you the the -- business on how VMA? sort sell that business your about of

Scott, David. it's

is I umbrella tenant think your right.

noted in decision the my prepared allows going our sharpening lean focus as I So for portfolio remarks, into as forward. we of

multiyear track within we think our a of the though, have about you record investments, investments As portfolio. long making

as support of Care addressable Accountable broadening and expansion market and and Josh, to digital-first delivery integrated infrastructure data-led Expanding talked in or capabilities it CuraScript off we a be broader about the new SD continuing orientation in array capability. investments capabilities, and the a development to expansion Pathwall of with and professionals and invest programs capabilities. scale ClearCare before proven So our we face think health what I care systems. Evernorth for a And mentioned about

pharmacy machine for our about, affordability, we out that fuel think the broadly continuing and strategy of finally, and a So leverage sustained it of be lens. on through class medical that items cost AI to get administrative variety investment learning speaking,

about demonstrated collaborative that decade, within our care question exchange between very to the a to targeted business otherwise, the complementary as that are XXXX benefit the government. government and influences sitting continue now by exchange as our to see of the successfully a as a we in commercial Obviously, market focus relates accountable from as it leverage viewed yet aspect through meaningful exchange taking we've And As we've business relationships. for portion the we today, the always to business. able otherwise, as well or its design the a around to with that inception

We will long market right collaborative targeted take relationships care complementary have have as our very place market we part portfolio. of as and positions, a be the in to by

Scott. to strategy helps, categories a of a this. result the speaking, see as of broadly accelerate the capacity, and it as the though, corporation changing I hope that as I is of in some you I don't articulated think more result the don't posture create changes made to. I investment exchange reference So it, does And

Our with comes next of from America. Fischbeck question Bank Kevin

you about more XXXX guidance a by I in subsegments was expectations, Advantage as how going for on the then that's guess wondering membership I and if more color guidance give exchanges, volume commercial, the know then and a within little Medicare color could repricing and you're little the the is commercial I product. well.

Kevin, it's Brian.

So we projected Cigna XXXX have customers. as it relates to Healthcare the the decline in net

actions individual the and for business primary will in being of year, think can in portfolio, in this took net certain late last the business. this driver result pricing geographies this as discussed exchange individual needed You we customer the in exchange some declines XXXX. we of

modestly. by Employer we you Commercial be But business, subsegment should volumes up customer being think Within split this of expect the to U.S. a bit.

always national opportunities our So in continue a reminder, segment. Select apply X%. where but our market volume above-market and cycle, just And to more specifically, the within price be we relative expect we market strong than local share see is continued we a our approach level about the set a in the as approach you we segment, the decline still to think to growth bid growth county accounts as as will Select When for do, we see we this MA customer offset how business, XXXX by net benefits.

behavior, there resulted some originally And net A so we in of geographies, business. for growth the very just of some which was aggressive in most for local in had we Medicare Advantage pullbacks competitor few some geographies, targeted expected stable in this than environment saw what had And benefits. was light we in less areas, the funding what XXXX. resulted our

margins see all comparison net put when taken together, now the volume within we're overall of meaningful year-end the to Medicare I we're mentioned serving together, balance in see with Advantage to pleased all X in the Cigna grown expect as the expect down XXXX expand that's Healthcare for business But years. last would volumes markedly we year-end customers XXXX over slightly customer profit pieces is earlier, these you to a space we specifically. while year-over-year So right

from with Stanley. Erin Morgan next Our comes question Wright

transparency. and your thinking how pharmacy customers? broadly, about network in that offerings Or those transparent with around just prepared PBM remarks think of your just just more PBM or in are relationships. implications gaining how the and the your obviously, And at not means Evernorth, level customer across offerings level influence talked the more how base? traction that you discussions about models On and at cost-plus are getting around or you And you your do what does that

Erin, it's Eric.

to fundamentally, not equipped portfolio with that's how clients. in First a start support to and we the offer just work all, our of we would choice and flexibility approach

looking so simple in unique on that's in I'm all that And such options and that that's affordability cost and pricing offer And financing the of off and of simple range number and and at quarter, providing the network and XXXX David different new XXXX terms solution, the of we the independent of kind clients. back buyers. to. it our of to and solution delivered in increased lens our margin I It's the bring first provides always as fourth of based ways in a us externally fact, clear is access its was a open index-based pharmacy. in and the kind. already proud approaches needs the innovations solutions our ground We're in launched of that's meets really that the of we drugs solution drive in which dispensing that we've between types pharmacy And mentioned, its comprehensive to to cost disease, created we A to network. of shared

use that example. So as an

conversations for be long of that to lot that good and note as terms of in would tend the selling types these long about lead program but a as had time. offering, of implementation a things It's a seasons in We of time such. an

conversation on our that. good like solutions So clients some with

at networks solutions for that and are the interested for their services care We've configuration ways to more to and variety Looking value already Overall, in receive that adjust trade-off for and dollars. to in are paying same more they to are changes other exist improve note, the networks affordability ecosystem. clients our looking And relative flexibility in access broadly of health and with and overall demanding not the adapt profiles wide our the market of the that costs a got the exist. today.

capabilities clients got best capabilities good we've good up line approach be overall, and and our to our what need. flexibility, modularity with So to able

Our next Research. from Wolfe Lake comes with Justin question

drive years additional a strategic and broader Most health internal revenue up wanted to I last their and your businesses. profitability question their X a from MA. right, beyond care manage spend, models the business ask those to significant services of peers amount to set over of XX

well membership business just you sale the run right, and How of costs synergies the with you and are deployment investors services done repricing win but which provides declines. how pretty just it to amount of able of growth, and to internal the makes your value impact the of you're costs every versus controlling your to individual of capital market think stability sense, provide which there membership? that those forward? natural the the each into medical growth obviously of expect and strategy control, go having are to And going this should So do able you've of and kind exchanges, through risk medical years, over every few your year piece but each being out having services and last the business MA, about your there,

in There's it's Justin, lot question. your a David.

Let me we process try to our today as and thought go frame forward.

have well solution that. quality, clear and really reinforce First, marketplace, the clinical of we've X you that service own a services is not successfully able be on of to the in side mix date, and the believe partner fulfillment, to side continue including fulfill. quality the continue to have of equation we our on an track owned proven a total everything equation results believe approach of is to evolve a record and benefit that have quality not, we very do not philosophically, delivery do But our whether cost, that to and or total the delivering the in Point resonates not and executed portfolio. to it's we

the Healthcare front point Investor continue recall, within point to services at Days, for fulfilling back Evernorth, that the expansion framed in of And our for to expand reflect might portfolio on you frame a example, was you prior if at question we us, we and As we opportunity existed amount actually the time that of conversations portfolio. services. of the in Signet those your

is We're only though mechanism for also to well. predicated economic funding for successfully not model cost. self-funded guaranteed shared Our as alignment it on able importantly or having do

ability two time to our Evernorth continue that is see portfolio. point with to the over So services we grow

We've continue the proven invest specialty to grow. services, complexity growth three to invest additional services importantly, to around we step that as rate scale, in and Point and to Most clinical The off is is of continue capabilities. it see certain charts. opportunities in. been spending our function to relates very that clear

we that there and to will space position continue the leadership to a in through grow, leader be that continue have our assets. market will We

third, market the expand of expects we need physical just And the around forward. breadth go capabilities. the ability to Secondly, to much coordinate we most leading to connect services services. The The and our within expand and and at statements have stop virtual way. behavioral for more coordination continue health a X services now comprehensive in and is will of behavioral illustration that as health we

all able point. with own the that services your end to not have So we on of to but to to be deliver equation be you aspects to services go-forward with to a we our agree do care believe I'll agreement basis. able the support capabilities invest with point delivery your right in of continuing

hopefully, that gives framing. you a So

strategy forward. time of an As going might at because spend on part seventh important on today our of strategy growth part important Day an and our we'll it's you expect, Investor this our the

Lance with Bernstein. next from Our comes question Wilkes

respect you products go Could about rates care talk fees on selling here season, then just employer, there's bit over drop to Cigna if selling any you've in self-insured? the PBM. little in in you with the explain, And gone a you And business specialty you 'XX And interesting any priorities? little a 'XX at penetration the quick as the how also Health changes through in could are just with then in clarification the as as in are side going a look there employer of the trends if season that. into

was So clarification. a just that

The other real is a question. one

the of Brian. take it's majority Lance, I'll your question.

there. in pieces different of number a there's think I

see company's the part been As it attachment, the employer. we of if business, an as Healthcare products, the you know, relates strategy the clinical being we have long-standing of greater a to with when in will, relationship and to much of integration you has of value medical the because book the Cigna specialty multiple components

strategy. the been those by segment in the that's certainly to subsegment, And the for that at the bifurcate XXX. offerings market, our important Most call of once. company employers many of of buy tend we down So Select part under years, to entirety

work to a then bit lower and where of have very we rates carte more tends different comparatively get you space penetration high when purchasing a there services. account the under the national user XXX the be in So little to la

too few patterns I speaking, changed years. over much last haven't broadly So those the would say

the some season, On the in preferences particular your is season question the the Select with employer of selling on the XXXX and largely segment. exception over selling of

earlier, with. market grow I continues As at for an pleased that we're above that's area us rates, to mentioned and really

clients do and As we selling prospects. forward we new season, a up years. some bit national the volumes have for RFP are business in-house And RFPs to look both directionally, from 'XX some prior existing account

each That large as clients, purposes of needs. can of these Now that said, kind are would appreciate, have a you themes. of unique tend there for to few areas I highlight

be So can point are who with one our those solutions of larger vendors consolidate some to employers or supply integrated offerings. would seeking more

point that tend call solution we So to fatigue.

may talk or You hear about. I Eric

substance empowerment of standpoint these mental Secondly, managing from more important the that's been programs health and overall employers benefits health have employee become to absences enabled care employers at and productivity, delivered. the around of as consumer optimization team larger and more abuse a things further to in their are capabilities navigation cyto many like thirdly, care that and that, And of care is base. interested the digitally power time

those as the in quality provider as between that interest alignment areas and/or configurations and the cost see to well may various network finance provider optimize incentive here. continue we So

really themes So select share these in address well under our to will grow the and the simultaneously Cigna Healthcare offerings XXX will to positioned large employers segment. are from demand continue

David I wants a think comments here. few to add

Sure.

point amplify care more. of through terms is The and team. opportunities as one to amplification health solution in Cigna our fatigue, well add for as our plays that that team Just Evernorth

you when service, products to of cross-selling get it more a or The products. notion sometimes through affordability. the around state to integration mission-critical. but better and to didn't about and and think thought So think value, it's better we just sometimes the ability under reinforce is about of penetration that, more value leverage you're overall through clinical and this, I value to to just the the to deliver cross-selling, clients solutions wanted customers critical point outcomes, Tech

better to quality, by the would MLR our many clinical come clients enables shows differentiated certain benefit service improved highlight integrate I in to ability up and So better that level sustained services. in our affordability. with us high penetration. quality, aided is, a level of they proven of that a together that And generate cross-selling cases, performance high

Taylor Gary Cowen. with question next Our from comes

the stop-loss. square I I action look like then was MLRs back MLR want did, at headwind. acceleration? ACA you're in looks how that. seasonal how of enrollment year-over-year, of David, it substantial I to a like to go up. gets just I weeds ask your me fourth try to and should benefit pretty in to decline mean be but I'm actually going there basis A.J. particularly to where outperformed hundreds a stop afraid to typical And variance pattern, just much XQ loss broad your it the question I'm but and to hoping for much hundreds trend because drive around and improvement quarter an a XX it should to quarter points was tailwind guiding margin I When

much us XX? through favorable such walk be how And had that just helped much And of part quantify in why how a you headwind again then line. could XQ? second that that is So would you for performance the

Brian. it's Gary,

$X in know, the it and many really the line, which as as some to is self-funded earlier you Healthcare book, of offerings to important So naturally This relates attaches to of itself a the Cigna finished will with instances. XXXX loss our Lance, premium to portfolio, in have question, stop we that part billion product variability book this it.

fixated on fourth quarter. be tends get wouldn't to transpires quarter's X performance. little overly activity more bit that in There I a settlement the So

year, is run if whereas experience had quite a the do the the favorability quarter, out its same reasons have quarter which from of XX%, don't the more little the of over that when through way the bridge to the smooth we bit you you work the you of shouldn't course from you in why one standpoint. rate fourth dynamic, XX% So

the to increase earlier the basis the from XX landed of I at of the pieces So end points midpoint uptick to our the in more year-over-year a an the which in some we earlier, stop-loss guide. is that MCR assumption were levels is point profitability mentioned that points basis normalize 'XX XX traditional where A that of anticipated back of the will of XX% on the moving product stop-loss component products. function of reconciliation, to the that, key

I you line. encourage think the to here at with dynamics that way I that's think about product So would broadly the play

Our last from Windley Jefferies. comes question Dave with

to here The pretty for is 'XX premise your profit question looks Evernorth of my us. that highly guidance visible

just Evernorth you significant relative your I And Are underneath was the maybe expect 'XX. then those. to we in a those? some fully wanted costs part to XX% that onboarding So those unrelated, in completely magnitude? my Centene from how that questions but continue? for that you second past that ramping the to to kind you of guided ramp contribution gone? the Should biosimilar, remarks, contract Brian, X include understand of onboarding. are should Evernorth onboarding the In Are had mentioned size continue

things, please. X those So

It's David.

because Brian of Brian into hand give to then early the frame that your and question have the more little XXXX. a a But Eric of costs to you some to trajectory it intense XXXX like. leads you me And those a bit terms the we're onboarding look that Let during you 'XX, -- give a give really financials of I'll were onboarding Brian the question. framing And first. little of The year-over-year? what I'll in to ask relative of what ask services part and across costs color calling ask to to you in then color

Yes. David. Dave. Thanks,

the generics, performance. That's X% growth. all essentially expect the in earlier, Evernorth more GLP-X overall, normalizing profitability that, the to or So income that we the point then whether top have you benefit et annual range related year. X% back X% specialty And of those as on about trends think relationship cetera. that by the will as traditional with million be in in about more benefit that reflects our line growth of algorithm Centene of to of income be of a where AOI talked expected drugs, that that breakeven. implied having we our now costs, of is income the of $X in And average will to of the Eric And multiyear can

are there's relationships biosimilar amount we in from effect unique the new So of certainly of But as continued I wave a volume in client earlier, we're benefit XXXX. a and with getting specific XXXX. seeing large of the additional mentioned bit the

maybe So expand you bit. that dynamic can a on Eric,

Thanks, Great. Brian.

really Centene actually by how has the with benefit how So first am proud Implementation I well, really the month quite our customers. the has here worked been how and would great of Centene, first, our I really It's been noting successful. gone and just we of team. and nicely delivered one for come shared and team start collaboratively that's with a now together has effort across

with Now XXXX, as said associated spending had just noted, meaningful in and no we've revenue generated and loss Brian what implementation before, consistent we a XXXX.

have results approximately XXXX. We breakeven that be will in

Brian contract, work this. lot to therapies, individuals the the this, of outreach. alluded achieve this more the like contract will happen get their respect more that There's to just expect activity about the business. for et lower a think to rate to into at XXXX has cetera. timing you before, there's a client There's beginning should We of that be which our than With to year run margin overall

expenses the additional first part just that reflect of that. place our the work effect in here to activity there's of So normal take year, and will and has

So bit consistent that's But it's all had shaping. of in-year a what that shared we with before.

now those The final same I'd expected with or and is profitability of is our live note of to kind what but things ours specific lines, about be won't know specific trajectory the client previously. off client start that thing consistent a commenting that a we Centene along we on practice had going normal with here of consistent is the forward talked

will to closing the I back remarks. you. Thank now for over turn call David Cordani

to Just couple reiterate. messages a of

across it's a by where a company decade clearly and our year of and evolved strong to XXXX well, and we've as executed First was consistently and portfolio foremost, quite than those we've we company grow performance as our we reinforced executed more continue our business serve.

and deliver an long-term we're well to that our as well-balanced our momentum and XX% across to to XX% leverage going confidence portfolio sustain growth range our have pay continue franchise as EPS attractive We dividend. that within

passion, Finally, as their coworkers in we really importantly, importantly, continued for delivered my execution, the those in expansion our And up It pleased more even I their what our want proud well I'm their results. shows XXXX. XXXX. serve. our thank caring of orientation in we of I'm reach to and world excited around as disciplined for and for dedication in impact

seeing you away. you a Day, which As forward is many Investor look all, a month at note of our final for to we

early create to the of basis. be New our York to day. team look our our a Thanks. value expansion in see a Have additional So front on about go-forward to us, we we opportunity will March, City seeing forward great excited market talk and in and capabilities in

Cigna shortly. Review. call. this will this Fourth Results recording be business gentlemen, Quarter additional questions days for available respond the be A to conference XX XXXX concludes Ladies available this to will Group's Cigna Relations of and following Investor

the Thank You may There by or XXX-XX-XX required replay. recorded for this is dialing conference (XXX) you XXX-XXX-XXXX. access participating. no passcode for

We disconnect. will now