Cigna 2024 Profits Eclipse $3 Billion Despite Rising Costs

Core Insights - The Cigna Group reported over $3.4 billion in net income for 2024, including$1.4 billion in the fourth quarter, despite rising medical expenses from patients in its health plans [1][7] - The company is facing challenges similar to other health insurers in controlling costs due to an increase in patient claims, partly driven by pent-up demand from the Covid-19 pandemic [2][3] Financial Performance - Cigna's medical cost ratio (MCR) rose to 87.9% in Q4 2024 from 82.2% in Q4 2023, and for the full year 2024, the MCR was 83.2% compared to 81.3% in 2023 [4] - Total revenues for 2024 increased by 27% to $247.1 billion, primarily due to significant growth in Evernorth Health Services [7] - Net income for Q4 2024 was$1.4 billion, up from $1 billion in the same period last year, while total net income for 2024 was$3.4 billion, down from $5.1 billion in 2023 [7] Strategic Moves - Cigna is divesting its Medicare health benefits businesses and a medical care provider services operation for$3.3 billion to Health Care Service Corp, aiming to exit the government-subsidized health insurance market for seniors [5][6] - The deal includes the acquisition of Cigna's Medicare Advantage plans, supplemental benefits, and Medicare Part D drug benefits, expected to close in Q1 of the current year [6] Growth in Services - Evernorth, which includes the Express Scripts pharmacy benefit management company, saw a 20% increase in total pharmacy customers, reaching 118.3 million by the end of 2024 [8] - Adjusted revenues for the fourth quarter and full year 2024 increased by 47% and 46%, respectively, reflecting client wins and organic growth in pharmacy benefit services [8]