Cigna

Company information

• Date founded: 1982
• Industry: Healthcare and insurance
• Corporate headquarters: Bloomfield, Connecticut
• Type: Public

Overview

Cigna is a global managed healthcare and insurance company that operates within the United States and in several international markets. Committed to promoting health and well-being, Cigna maintains more than 178 million customer and patient relationships in more than thirty countries. It also uses the insights it derives from these relationships to develop approaches to improving people’s health and health outcomes. Through its insurance subsidiaries, Cigna offers medical, dental, life, behavioral and disability, and accident insurance. Cigna also offers a range of Medicare and Medicaid products and insurance coverages. In addition, Cigna operates a number of run-off healthcare businesses. One of these businesses is Evernorth Care Group (formerly Cigna Medical Group), a full-service staff-model health maintenance organization with satellites found throughout the Phoenix, Arizona, metropolitan area.

Cigna’s operations are divided into four segments: health services, integrated medical, international markets, and group disability and others. The health services segment focuses on pharmacy benefits management, specialty pharmacy services, clinical solutions, home delivery, and health management services. The integrated medical segment provides an array of healthcare solutions designed for employers and individuals. The international markets segment offers various insurance products and healthcare coverage options for people in its international markets, as well as for globally mobile employees working for multinational companies. Other segments include corporate-owned life insurance and Cigna’s run-off businesses.

Cigna’s primary focus is group life insurance. In that particular realm, the company offers two main group life insurance plans. Cigna’s group life insurance plans include group term life and group universal life policies that customers can obtain through their employers. A group term life policy offers temporary coverage that protects the holder for a certain period specified in the policy’s terms. In the case of Cigna group term life insurance, the coverage lasts for the duration of the holder’s employment. Cigna’s group universal life insurance policy offers permanent coverage. In addition, the policy itself can also build tax-deferred interest-earning cash value. Despite mostly focusing on group insurance, Cigna also offers one individual whole life insurance plan. The overage provided by this plan is permanent and accrues added cash value over time. Along with its different life insurance plans, Cigna also offers a number of optional riders that add extra benefits. Some of these include accelerated death benefit, accidental death benefit, children’s term, spouse term, and waiver of premium riders. Cigna also offers a range of Medicare plans that are available in certain states.

History

Cigna was formed in 1982 through the merger of the Insurance Company of North America (INA) and Connecticut General Life Insurance Company (CG). By the time of the merger, both companies had long and distinguished histories. INA was founded in Philadelphia, Pennsylvania, in 1792. At the time, Philadelphia was the young United States’ financial center and a major hub of economic activity. In late 1792, several of the city’s business people came together to create a general insurance company. With only two small fire insurance companies operating throughout America at the time, the entrepreneurs who ultimately created INA felt that having reliable, nearby insurance coverage was essential if they hoped to grow their businesses. To that end, they joined forces to found INA. During its first two years, INA only insured ship hulls and cargoes involved in local and international trade. Two years later, the company introduced fire insurance that offered protection for buildings and their contents. This made INA the first American company to provide insurance coverage on business inventories and private possessions.

As INA grew from a business perspective, it also began expanding geographically. In the early nineteenth century, the company set its sights on the western frontier. Gambling on the potential value of embracing the nation’s westward expansion, INA established an agency in Lexington, Kentucky, in 1807 and heavily invested in the recently acquired Louisiana Territory. This solidified INA’s standing and helped the company survive the War of 1812. In time, INA emerged as one of America’s top insurance companies. Later in its history, INA earned recognition for the key role it played in helping two important American cities recover from major disasters. After both the 1871 Great Chicago Fire and the 1906 San Francisco Earthquake, INA paid claims in full.

With INA already a success, CG was founded in 1865 through a special act of Connecticut’s General Assembly signed by its governor. Unlike INA, GC was created to meet the specific need for so-called “substandard” insurance—life insurance for higher-risk clients. Although it pivoted away from this focus within just two years, CG survived early struggles to become firmly established as a thriving insurance company by the 1880s. In the early twentieth century, CG found even greater success when it started offering group insurance for the first time. In 1962, CG took another step forward with its acquisition of the Aetna Insurance Company. To support its increasing diversification, GC subsequently created a holding company called GC Insurance Corporation. The original GC then became a subsidiary of the new entity.

By the early 1980s, the insurance industry was trending towards large multiline insurers. In an effort to follow this trend, INA and CG announced a decision to merge and form a new combined entity called the Cigna Corporation. The Cigna name was a nod to the companies’ former initials. Through the 1980s and 1990s, Cigna undertook a series of acquisitions that further strengthened its position in the insurance market. Some of these included the acquisition of international insurance underwriter American Foreign Insurance Association (AFIA) in 1984, employee benefits provider EQICOR in 1990, and Healthsource, Inc. in 1997. Beginning in 1998, Cigna shifted its primary focus to healthcare, selling off some of its other insurance businesses as part of this process.

In 2002, the company launched the first online physician-led healthcare network for employees on global assignments and introduced a personalized healthcare web portal dubbed myCigna.com. Cigna continued to expand its health-related offerings through the first decades of the twenty-first century, remaining a leader in the healthcare and health insurance industries. In September 2022, Cigna rebranded its health services portfolio under Evernorth, including Express Scripts, Accredo, and eviCore. The following year, Cigna renamed its holding company to The Cigna Group, its health benefits provider business unit became Cigna Healthcare, and Evernorth became Evernorth Health Services. Cigna sold its group life and disability insurance sector to New York Life for $6.3 billion in 2020, and in 2021, Cigna's Evernorth acquired telehealth company MDLIVE to enhance virtual care services

Impact

Cigna is well-known for being one of America’s largest and most familiar healthcare and health insurance companies. It is also a Fortune 500 company that frequently ranks as one of the largest American corporations in terms of total revenue. Much of Cigna’s success is due to its commitment to understanding the unique insurance needs of employers, families, and individuals.

Like many large corporations, Cigna has been at the center of several high-profile controversies. Perhaps the most notorious of these controversies was the company’s involvement in the death of California teenager Nataline Sarkisyan. In late 2007, Cigna was strongly criticized for its decision not to pay for a liver transplant that Sarkisyan, who was diagnosed with recurring leukemia, needed to survive. Although her condition was ultimately likely to be terminal, Sarkisyan’s physicians believed she could live at least another six months with a new liver. When a liver became available, Cigna refused to sign off on the transplant because performing such a procedure on a patient in Sarkisyan’s condition would qualify as experimental. This decision sparked a loud public outcry that eventually led Cigna to reverse course and even offer to pay for the surgery, but Sarkisyan died before a transplant could be performed. Another controversy emerged in 2020 when the Department of Justice filed a lawsuit against Cigna alleging that the insurer knowingly defrauded Medicare, Medicare Advantage, and Medicaid for $1.4 billion. The lawsuit alleged that Cigna fraudulently received funds through these programs by submitting diagnostic codes for conditions with which patients were not actually diagnosed. In October 2022, the United States District Attorney’s Office for the Southern District of New York announced it had filed an additional civil fraud lawsuit against Cigna for inflated Medicare claims. These and other similar controversies damaged Cigna’s public image.

In contrast with the controversies surrounding its operations, Cigna seeks to have a positive community impact through its charitable arm, the Cigna Foundation. For decades, the Cigna Foundation has worked to improve the peace of mind, health, and well-being of those its parent company serves across the country and worldwide. The Cigna Foundation achieves this goal by partnering with other non-profit organizations. In 2019, for example, the Cigna Foundation partnered with the Express Scripts Foundation to deploy over $14 million in grants for other non-profits equally committed to promoting health and wellness. The Cigna Foundation also administers several of its own grant programs. The most notable of these is the Healthier Kids for Our Future grant program, a five-year, $25 million global initiative aimed at the world to overcome issues affecting children’s health. Some of the organization's other grant programs focus on lowering health risks, encouraging health equality, promoting preventive care, broadening educational access among underserved and underrepresented students, and equipping people in the workforce with the skills and tools they need to have successful careers.

In 2020, the foundation partnered with the New York Life Foundation to establish the Brave of Heart Fund, donating $25 million to support the families of frontline healthcare workers who lost their lives to COVID-19. In the early and mid-2020s, the foundation continued supporting projects, mainly focusing on education, health, and workforce development. The foundation launched a $9 million fund to reduce health disparities in disproportionately underserved communities over three years.

Bibliography

“Cigna Corp.” Companies History, 13 Mar. 2024, www.companieshistory.com/cigna-corp. Accessed 20 Jan. 2025.

"Cigna." Forbes, www.forbes.com/companies/cigna. Accessed 20 Jan. 2025.

“The Cigna Group Foundation.” Cigna, www.thecignagroup.com/our-impact/esg/healthy-society/community/foundation. Accessed 20 Jan. 2025.

“Cigna.” Health Markets, www.healthmarkets.com/company/cigna. Accessed 20 Jan. 2025.

Hackett, Mallory. “DOJ Brings Lawsuit against Cigna for Allegedly Submitting $1.4 Billion in False Medicare Advantage Claims.” Healthcare Finance, 6 Aug. 2020, www.healthcarefinancenews.com/news/doj-brings-lawsuit-against-cigna-allegedly-submitting-14-billion-false-medicare-advantage. Accessed 20 Jan. 2025.

Hannush, Julian. "Healthier Kids for Our Future: Improving the Health and Vitality of 280K Children, Families, and Educators." Cigna, newsroom.thecignagroup.com/healthier-kids-for-our-future-impact-report. Accessed 20 Jan. 2025.

“Milestones.” Cigna, www.cigna.com/about-us/company-profile/milestones. Accessed 20 Jan. 2025.

"Our Capabilities” Cigna, www.thecignagroup.com/our-capabilities. Accessed 20 Jan. 2025.

“United States Files Civil Fraud Lawsuit against Cigna for Artificially Inflating Its Medicare Advantage Payments.” Department of Justice, 17 Oct. 2022, www.justice.gov/usao-sdny/pr/united-states-files-civil-fraud-lawsuit-against-cigna-artificially-inflating-its. Accessed 20 Jan. 2025.