CIGNA SELLS OFF THEIR MEDICARE BUSINESS

 CIGNA SELLS OFF THEIR MEDICARE BUSINESS

Cigna, long recognized as a Global Leader in Healthcare, recently announced the sale of its Medicare Division. This includes their Medicare Part D Plans, Medicare Advantage  Plans, and their Medigap/Medicare Supplement plans to Health Care Service Corporation (HCSC). 

HCSC, which is headquartered in Chicago, operates several Health Insurance plans across the country. According to their statement, HCSC is committed to growing and expanding its Medicare Advantage Portfolio. They hope that by combining all of their resources they will emerge as a leader in the Medicare Marketplace. 

Cigna's Medicare Division was only about 4% of the company's total revenues in FY 2022.

The terms of the deal outline HCSC’s acquisition of Cigna Medicare Advantage,  Cigna supplemental benefits, Medicare Part D drug plans, and Care Allies. Care Allies is a business, previously owned by Cigna, that helps medical professionals with contracting and administrative services for a total of 3.7 billion dollars (3.3 Billion in cash and another 400 million dollars in capital.

Before the purchase, HCSC reported Before the acquisition, that they currently had over one million members in their Medicare Advantage plans throughout the United States. It is estimated that CIGNA land HCSC an additional 600,000 Medicare Advantage Beneficiaries plus an additional 468,000 beneficiaries in their various Supplemental Lines, including their Medicare Supplement business.

A statement from the CIGNA Leadership team indicated that CIGNA believed the administrative and dedicated staff required to deliver and administer their Medicare Divisions was not sustainable to deliver profits to their shareholders. 

The purchase of Medicare business from Cigna by HCSC includes a four-year agreement in which Evernorth Health Services will continue to provide Medicare and pharmacy benefits under the Cigna corporation. This will be Cigna’s only remaining Medicare product once the deal has been finalized.

Before the acquisition, HCSC reportedly had more than one million  Medicare members in its book of business, with 217,000 Medicare  Advantage customers in 2024. By adding Cigna’s book of business to their arsenal, HCSC will add 600,000 Medicare Advantage customers and 468,000 customers covered by additional services acquired in the deal.al.l..ding your coverage.CIGNA

In October 2023, Allstate declared that they were looking to sell their Healthcare Divisions and focus on their business of insuring Transportation Vehicles and their Property and Casualty business.  To date, there is nothing concrete to report, but that declaration does not appear to be helping Allstate as many consumers are reluctant to switch to Allstate Medicare plans, with so much uncertainty in the air.