Cigna Group (CI) 10-K risk factor changes: FY2020 vs FY2019

- differentiate our [removed: products and] [added: products,] services [added: and solutions] from those of our competitors;

- [removed: develop and] [added: develop,] introduce [added: and partner to bring forward] new and innovative products, solutions or programs that focus on improving patient outcomes and assist in controlling costs or are in response to government regulation and the increased focus on consumer-directed products;

- grow our product [removed: portfolio] [added: portfolio, expand our addressable markets] and identify and introduce the proper [removed: mix] [added: mix, coordination] or integration of products that will be accepted by the marketplace;

- access or continue accessing key drugs and successfully penetrate key treatment categories in our specialty [added: pharmacy] business;

- manage our medical, pharmacy, [removed: administrative,] [added: administrative] and other operating costs effectively; and

- contract with [removed: pharmaceutical manufacturers and] [added: health care providers,] pharmacy providers [added: and pharmaceutical manufacturers] on favorable terms.

For our strategic initiatives to succeed, we must effectively [removed: integrate] [added: collaborate across] our operations, [removed: including with Express Scripts and other] [added: integrate our] acquired businesses, actively work to ensure consistency throughout the [removed: organization,] [added: organization] and promote a global mind-set along with a focus on individual customers and clients.

- new or alternative business [removed: models;][added: models or new government options or offerings;]

- technological changes and rapid shifts in the use of technology, such as [removed: telemedicine;][added: telehealth;]

- [removed: change] [added: changes] in the generic drug market or the failure of new generic drugs to come to market; [added: or]

Our failure to compete [removed: effectively] [added: effectively,] to differentiate our products and services from those of our competitors and maintain or increase market share could materially adversely affect our results of operations, financial position and cash flows.

Our Express Scripts client contracts generally have three-year [removed: terms.][added: terms and may be subject to periodic renegotiation of pricing terms based on market factors.]

As described in greater detail in the description of our business in Item 1 of this Form 10-K, one of our key clients in the [removed: Health Services] [added: Evernorth] segment is the United States Department of Defense.

Our success depends, in part, on our ability to compete effectively in our markets, set prices appropriately in highly competitive markets to keep or increase our market share, increase customers as planned, differentiate our business offerings by innovating and delivering products and services that provide enhanced value to our customers, provide quality and satisfactory levels of [removed: service,] [added: service] and retain accounts with favorable medical cost experience or more profitable products versus retaining or increasing our customer base in accounts with unfavorable medical cost experience or less profitable products.

We must remain competitive to attract new customers, retain existing [removed: customers,] [added: customers] and further integrate additional product and service offerings.

[added: The negative] reputational impact of a significant event, including a failure to execute on customer or client contracts or strategic or operational initiatives, failure to comply with applicable laws or regulations, or failure to innovate and deliver products and services that demonstrate greater value to our customers, could affect our ability to grow and retain profitable arrangements, which could have a material adverse effect on our business, results of operations, financial position and cash flows.

[removed: Further, federal] [added: Federal] and state regulatory agencies may restrict [added: or prevent entirely] our ability to implement changes in premium rates.

Fiscal or other concerns related to the government-sponsored programs in which we participate, such as [removed: Medicare,] [added: Medicare Advantage plans and Medicare Part D plans,] may cause decreasing reimbursement rates, delays in premium payments, restrictions on implementing changes in premium rates or insufficient increases in reimbursement rates.

Premiums in the [removed: Integrated] [added: U.S.] Medical segment are generally set for one-year periods and are priced well in advance of the date on which the contract commences or renews.

Our revenue on [added: Medicare Advantage plans,] Individual and Family Plans (“IFP”) and Medicare [removed: policies] [added: Part D plans] is based on [added: rates and] bids submitted midyear in the year before the contract year.

Although we base the premiums we charge and our [added: Medicare Advantage,] IFP and Medicare [added: Part D rates and] bids on our estimate of future health care costs over the contract period, actual costs may exceed what we estimate in setting premiums.

Our health care costs also are affected by external events that we cannot forecast or project and over which we have little or no control, [added: including changes in regulations,] as well as [added: provider billing practices and] changes in customers’ health care utilization [removed: patterns and provider billing practices.][added: patterns, which may, among other things, impact our ability to appropriately document their health conditions.]

Considerable variability is inherent in such estimates, and the accuracy of the estimates is highly sensitive to changes in medical claims submission and processing patterns or procedures, changes in customer base and product mix, changes in the utilization of prescription drugs, medical or other covered items or services, changes in medical cost trends, changes in our health management [removed: practices] [added: practices, changes in regulations] and the introduction of new benefits and products.

Additionally, we must estimate the amount of rebates payable by us under the ACA’s and [removed: CMS’s] [added: CMS’] minimum loss ratio rules and the amounts payable by us to, and receivable by us from, the United States federal government under the ACA’s remaining premium stabilization program.

Because establishing reserves is an inherently uncertain process involving estimates of future losses, there can be no certainty that ultimate losses will not exceed existing [removed: reserves.][added: reserves which may adversely affect our results of operations, financial position and cash flows.]

While benefit plans place limits on the amount of charges that will be considered for reimbursement and [removed: state] regulations seek to [added: prescribe payment levels,] establish methodologies and dispute resolution processes, out-of-network providers are increasingly sophisticated and aggressive.

Our sales could be materially adversely affected if we [removed: were] are unable to attract, retain and support such independent producers and consultants or if our sales strategy is not appropriately aligned across distribution channels.

If significant changes occur within the pharmacy provider marketplace, or if other issues arise with respect to our pharmacy networks, including the loss of or adverse change in our relationship with one or more key pharmacy providers, our business and financial results could be [removed: impaired.][added: adversely affected.]

More than 67,700 [removed: retail pharmacies, which represent over 99% of all United States retail pharmacies,] [added: pharmacies] participated in one or more of our networks as of December 31, [removed: 2019.][added: 2020.]

The ten largest retail pharmacy chains represent approximately [removed: 65%] [added: 64%] of the total number of stores in our largest network.

These risks can vary substantially by market, and include political, legal, operational, regulatory, economic and other risks, including government intervention that we [removed: do not face in our U.S. operations.]

- [removed: acts of civil unrest, war, terrorism,] [added: man-made disasters,] natural disasters [removed: or] [added: and] pandemics, such as the [removed: recent coronavirus outbreak,] [added: COVID-19 pandemic,] in locations where we operate; and

Any one of these challenges could negatively affect our operations or [removed: long-term] [added: long term] growth.

For example, due to the concentration of our international business in South Korea, the International Markets segment is exposed to potential losses resulting from economic and regulatory changes in that [added: country and the geopolitical climate in the Korean Peninsula, as well as foreign currency movements affecting the South Korean currency, that could have a significant impact on the segment’s results and our consolidated financial results.]

Strategic [removed: transactions, including our acquisition of Express Scripts,] [added: transactions] involve risks and we may not realize the expected benefits because of integration difficulties, underperformance relative to our expectations and other challenges.

Our ability to achieve the anticipated benefits of strategic [removed: transactions] [added: transactions, including synergies, cost savings, innovation and operational efficiencies,] is subject to numerous uncertainties and risks, including our ability to [removed: integrate] [added: successfully combine] or separate [added: business] operations, resources and systems, including data security [removed: systems,] [added: systems and internal financial control standards,] in an efficient and effective manner.

Integration and separation activities may result in additional and unforeseen expenses, and the anticipated [removed: benefits, including with respect to the Express Scripts integration,] [added: benefits] may not be fully realized or may take longer to realize than expected.

Delays or issues encountered in these activities could have a material adverse effect on the revenues, expenses, operating results and financial condition of the [removed: combined] company.

Strategic transactions could result in increased costs, including facilities and systems consolidation [added: or separation] costs and costs to retain key employees, decreases in expected revenues, earnings or cash [removed: flows,] [added: flows] and goodwill or other intangible asset impairment charges.

As of December 31, [removed: 2019,] [added: 2020,] our goodwill and other intangible assets had a carrying value of approximately [removed: $81] [added: $80] billion, representing [removed: 52%] [added: 51%] of our total consolidated assets.

- develop and create data and analytic solutions to support and improve outcomes for our products, services and solutions, including creating and developing solutions and services through partnerships with other industry participants;

- changes in utilization of health care, prescription drugs or other covered services and items, including under risk-based contracts in the health benefit management market and for those businesses that utilize risk adjustment methodology.

The scale, scope and duration of the COVID-19 pandemic continues to be unknown and the overall impact on our business, operating results, cash flows or financial condition has been and may continue to be material.

The COVID-19 pandemic has adversely affected global economies, financial markets and the overall environment for our business, and the extent to which it may impact our future results of operations and overall financial performance remains uncertain.

The COVID-19 pandemic has in some instances, and may continue to, heighten the potential adverse effects on our business, operating results, cash flows or financial condition as described below or in other risk factors within this section of the Form 10-K including, but not limited to, the likelihood of and impact from:

- unfavorable economic conditions on our clients and customers (both employers and individuals), health care providers, pharmaceutical manufacturers, pharmacy providers and third-party vendors, as well as federal and state entities and programs;

- changes in medical claims submission and processing patterns or procedures; changes in customer base and product mix; changes in utilization of prescription drugs, medical or other covered items or services, including increased behavioral health services utilization; changes in medical cost trends; changes in our health management practices; and the introduction of new benefits and products causing actual claims to exceed our estimates;

- changes in health care utilization patterns, provider billing practices and other external events that we cannot forecast or project and over which we have little or no control impacting our ability to accurately predict, price for and manage health care costs and ultimately our profitability, including impacts from care deferral on, among other things, risk adjustment revenue and acuity of future care;

- increased costs or reductions in revenue, including costs for COVID-19-related care, testing and treatment and related cost-share waivers for our customers; vaccine and other coverage mandates; and support for employees, clients, customers and providers;

- significant disruptions in service within our operations or among our key suppliers or other third parties, including decreased worker productivity and operational and sales disruptions, including as a result of remote working arrangements, increased medical, emergency or other leave, quarantines, government actions or restrictions;

- compliance with substantial government regulation, including privacy and security requirements associated with providing telehealth and remote care options for individuals and new laws or regulations or changes in existing laws or regulations, such as vaccine and coverage mandates and premium deferrals, which laws or regulations may vary significantly by jurisdiction;

- prioritization of matters relating to COVID-19 resulting in delays in responsiveness by regulatory agencies and other third parties in matters arising in the ordinary course of business;

- cyberattacks or other privacy or data security incidents, including as a result of the transition to a remote work environment by substantially all of our workforce and the workforces of third parties with whom we contract;

- significant shifts in the structure of the industry which could alter dynamics and, if we fail to adapt, negatively impact our business;

- risks inherent in foreign operations, including political, legal, operational, regulatory, economic and other risks;

Additionally, if we do not respond appropriately to the pandemic, or if our clients or customers do not perceive our response to be adequate, we could suffer damage to our reputation, which could adversely affect our business.

We believe COVID-19’s adverse impact on our business, operating results, cash flows or financial condition will be driven primarily by the severity and duration of the pandemic, including the impact of the breadth and timing of implementation and the efficacy and costs of vaccination programs, the pandemic’s impact on our employees, clients, customers, suppliers and partners, as well as the U.S.

and global economies and the continued actions taken by governmental authorities and other third parties in response to the pandemic.

Those primary drivers are largely beyond our knowledge and control, and may be more adverse than our current expectations.

Given these uncertainties, we cannot estimate the full impact COVID-19 will have on our business, operating results, cash flows or financial condition, but the adverse impact could be material.

Our participation in health insurance exchanges through our IFP offerings involves

Additionally, certain regulations may impact our ability to obtain competitive prices.

do not face in our U.S. operations.

- acts of civil unrest, war and terrorism, as well as other political and economic conflicts such as through imposition of economic or political sanctions;

Future evaluations requiring an impairment to

Our information

In addition, while we have certain standards for all vendors

In addition, changes to government policies not specifically targeted to the health services industry, such as a change in tax laws and the corporate tax rate or government spending cuts, could have significant impacts on our business, results of operations, financial condition and liquidity.

For example, the base premium rate paid differs depending upon a combination of various factors such as defined upper payment limits, a member's health status, age, gender, county or region, benefit mix, member eligibility category and risk scores.

We procure insurance coverage to cover some of these potential liabilities, however we also self-insure a significant portion of our litigation risks.

Additionally, we are, and may in the future be, subject to *qui tam* actions in which the government may or may not intervene.

We may also use such information to create analytic models designed to predict, and potentially improve, outcomes and patient care.

Economic and market conditions affect the value of our financial instruments and the value of particular assets and liabilities, investment income and interest expense.

We maintain significant indebtedness in the ordinary course of business and may incur further indebtedness in the future.

Our indebtedness could adversely affect our financial condition, our ability to react to changes in the economy or our industry and could divert our cash flow from operations for debt service costs, leaving us with less cash flow from operations available to fund growth, stock repurchases, dividends and other corporate purposes.

Carrying indebtedness:

- increases our vulnerability to general adverse economic and industry conditions, which may require us to dedicate an even greater percentage of our cash flow from operations to the payment of principal and interest on our debt and limit our access to capital markets such that additional capital may not be available or may be available only on unfavorable terms;

- exposes us to increases in interest rates to the extent increased interest expense is not offset by increased income from our investment assets; and

The covenants in our debt instruments may have the effect, among other things, of restricting our financial and operating flexibility to respond to significant changes in business and economic conditions.

We may incur or assume significantly more debt in the future which may subject us to additional restrictive covenants and increase the risks described above.

- a change in drug utilization; or

- a change in utilization under risk-based contracts in the health benefit management market.

The negative

country and the geopolitical climate in the Korean Peninsula, as well as foreign currency movements affecting the South Korean currency, that could have a significant impact on the segment’s results and our consolidated financial results.

For example, the continued success of the Express Scripts acquisition will depend, in part, on our ability to continue to successfully combine the businesses of Cigna and Express Scripts and realize the anticipated benefits, including synergies, cost savings, innovation and operational efficiencies, from the combination.

Key risks of the Express Scripts integration include, but are not limited to, retaining existing clients and attracting new clients on profitable terms; maintaining employee morale and retaining key management and other employees; consolidating corporate and administrative infrastructures and realizing operational synergies; integrating information technology, communications programs, financial procedures and operations, and other systems, procedures and policies; coordinating geographically separate organizations; and on-going modifications to internal financial control standards.

Additional unanticipated costs may be incurred in the integration of Express Scripts’ businesses.

Although we expect that the elimination of duplicative costs, as well as the realization of other efficiencies related to the integration of those businesses, should allow us to more than offset incremental transaction and merger-related costs over time, this net benefit may not be achieved in the near term, or at all.

parties, competition between and among parties, compliance activities (including compliance with applicable CMS requirements), growing the business in a manner acceptable to all the parties, maintaining positive relationships among the parties, clients and customers, initial and ongoing governance of joint ventures, and customer and business disruption that may occur upon a joint venture termination.

As described under “Business – Regulation” in Part I, Item 1 of this Form 10-K, on November 1, 2018, CMS released a proposed rule that would revise its RADV methodology by, among other things, excluding an adjustment for underlying fee-for-service data errors and extrapolating RADV results at the contract level for RADV audits of contract year 2011 and all subsequent years.

The Company, along with other Medicare Advantage organizations and additional interested parties, submitted comments to CMS on the proposed rule as part of the notice-and-comment rulemaking process.

The comment period concluded on August 28, 2019.

The executive order signed in October 2017 that halted payment of the cost-sharing reduction subsidies under the ACA has created additional uncertainty regarding the future of public health insurance exchanges.

We seek to procure insurance coverage to cover some of these potential liabilities.

In addition, certain types of damages, such as punitive damages, may not be covered by insurance, and insurance coverage for all or certain forms of liability may become unavailable or prohibitively expensive in the future.

For example, generally low levels of interest rates on

investments, such as those experienced in U.S. and foreign financial markets during recent years, have negatively impacted our level of investment income earned in recent periods.

If the equity and credit markets experience extreme volatility and disruption, there could be downward pressure on stock prices and restricted access to capital for certain issuers without regard to those issuers’ underlying financial strength.

Extreme disruption in the credit markets could adversely impact our access to, and cost of, capital in the future.

In the event of adverse economic and industry conditions, we may be required to dedicate a greater percentage of our cash flow from operations to the payment of principal and interest on our debt, thereby reducing the funds we have available for other purposes, such as investments and other expenditures in ongoing businesses, acquisitions, dividends and stock repurchases.

In these circumstances, our ability to execute our strategy may be limited, our flexibility in planning for or reacting to changes in business and market conditions may be reduced, or our access to capital markets may be limited such that additional capital may not be available or may be available only on unfavorable terms.

In connection with the combination with Express Scripts, we have considerably higher levels of indebtedness than Cigna and Express Scripts previously carried, which will result in higher relative debt service costs and less cash flow from operations available to fund growth, stock repurchases and other corporate purposes.

This level of indebtedness:

- increases our vulnerability to general adverse economic conditions, including increases in interest rates for our borrowings that bear interest at variable rates and are in a greater amount than floating rate assets held, or if such indebtedness is refinanced at a time when interest rates are higher; and

The covenants to which we have agreed in connection with the financing, and our indebtedness and higher debt-to-equity ratio in comparison with that of Cigna or Express Scripts on a recent historical basis, may have the effect, among other things, of restricting our financial and operating flexibility to respond to changing business and economic conditions, creating competitive disadvantages compared with other competitors with lower debt levels during the deleveraging process.

- Our historical disability claim experience and industry data indicate that submitted disability claims rise under adverse economic conditions.

We enter into reinsurance arrangements with other insurance companies, primarily to limit losses from large exposures or to permit recovery of a portion of direct losses.

| | [added: | |] PAGE | [added: | |]

| [removed: [*Executive Overview*](#TOC2_Executive_Overview)] [added: *[Executive Overview](#ic5b0f4c2cee8492e9ee4ea74564c54b2_133)*] | [removed: [52](#TOC2_Executive_Overview)] | [added: | [53](#ic5b0f4c2cee8492e9ee4ea74564c54b2_133) | | |]

| [removed: [*Liquidity] [added: *[Liquidity] and Capital [removed: Resources*](#TOC2_Liquidity_and_Capital_Resources)] [added: Resources](#ic5b0f4c2cee8492e9ee4ea74564c54b2_142)*] | [removed: [58](#TOC2_Liquidity_and_Capital_Resources)] | [added: | [60](#ic5b0f4c2cee8492e9ee4ea74564c54b2_142) | | |]

| [removed: [*Critical] [added: *[Critical] Accounting [removed: Estimates*](#TOC2_Critical_Accounting_Estimates)] [added: Estimates](#ic5b0f4c2cee8492e9ee4ea74564c54b2_151)*] | [removed: [63](#TOC2_Critical_Accounting_Estimates)] | [added: | [65](#ic5b0f4c2cee8492e9ee4ea74564c54b2_151) | | |]

| [removed: [*Segment Reporting*](#TOC2_Segment_Reporting)] [added: *[Segment Reporting](#ic5b0f4c2cee8492e9ee4ea74564c54b2_157)*] | [removed: [67](#TOC2_Segment_Reporting)] | [added: | [68](#ic5b0f4c2cee8492e9ee4ea74564c54b2_157) | | |]

| [removed: [*International Markets*](#TOC2_International_Markets)] [added: *[International Markets](#ic5b0f4c2cee8492e9ee4ea74564c54b2_169)*] | [removed: [70](#TOC2_International_Markets)] | [added: | [71](#ic5b0f4c2cee8492e9ee4ea74564c54b2_169) | | |]

| [removed: [*Group] [added: *[Group] Disability and [removed: Other*](#TOC2_Group_Disability)] [added: Other](#ic5b0f4c2cee8492e9ee4ea74564c54b2_172)*] | [removed: [71](#TOC2_Group_Disability)] | [added: | [72](#ic5b0f4c2cee8492e9ee4ea74564c54b2_172) | | |]

| [removed: [*Investment Assets*](#TOC2_INVESTMENT_ASSETS)] [added: *[Investment Assets](#ic5b0f4c2cee8492e9ee4ea74564c54b2_178)*] | [removed: [72](#TOC2_INVESTMENT_ASSETS)] | [added: | [73](#ic5b0f4c2cee8492e9ee4ea74564c54b2_178) | | |]

*Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to provide information to assist you in better understanding and evaluating our financial condition as of December 31, [removed: 2019] [added: 2020] compared with December 31, [removed: 2018] [added: 2019] and our results of operations for [removed: the year ended December 31, 2019] [added: 2020] compared with [added: 2019 and] 2018 and [removed: 2017.][added: is intended to help you understand the ongoing trends in our business.]

We encourage you to read this MD&A in conjunction with our Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K [removed: (“Form 10-K”)] [added: ("Form 10-K")] and the [removed: Risk Factors] [added: “Risk Factors”] contained in Part [added: I, Item] 1A of this Form 10-K.

For comparisons of our results of operations for [removed: the year ended December 31, 2018] [added: 2019 compared] with [removed: 2017] [added: 2018,] please refer to the previously filed MD&A included in Part II, Item 7 of [removed: our* [*Annual Report on] [added: our] Form [removed: 10-K*](http://www.sec.gov/Archives/edgar/data/1739940/000104746919000792/a2237767z10-k.htm) *for] [added: 10-K for] the [removed: fiscal] year ended December 31, [removed: 2018.*][added: 2019.*]

*Unless otherwise indicated, financial information in [removed: the] [added: this] MD&A is presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

See Note [removed: 2] [added: 3] to the Consolidated Financial Statements [removed: included] in this Form 10-K for additional information regarding the Company’s significant accounting [removed: policies.* *In some of our financial tables in this MD&A, we present either percentage changes or “N/M” when those changes are so large as to become not meaningful.][added: policies.]

*In this MD&A, our consolidated measures “adjusted income from operations,” earnings per share on that same [removed: basis,] [added: basis] and “adjusted revenues” are not determined in accordance with GAAP and should not be viewed as substitutes for the most directly comparable GAAP measures of “shareholders’ net income,” “earnings per share” and “total revenues.” We also use pre-tax adjusted income from operations and adjusted revenues to measure the results of our segments.*

We define adjusted income from operations as shareholders’ net income (or income before taxes for the segment metric) excluding realized investment gains and losses, amortization of acquired intangible assets, [added: special items and prior to 2020,] results of [removed: Anthem] [added: Anthem, Inc.] and Coventry Health Care Inc. (“Coventry”) (collectively, the “transitioning clients”) (see the “Key Transactions and [added: Business] Developments” section of [removed: the] [added: this] MD&A for further discussion of transitioning [removed: clients) and special items.][added: clients).]

[removed: *Realized] [added: *•Realized] investment gains (losses) including changes in market values of certain financial instruments between balance sheet dates, as well as gains and losses associated with invested asset sales.*

[removed: *Amortization] [added: - *Amortization] of acquired intangible assets because these relate to costs incurred for acquisitions.*

[removed: *Results*] [added: - *Results*] *of transitioning [removed: clients*] [added: clients prior to 2020,*] *because those results are not indicative of ongoing results*.

[removed: *Special] [added: - *Special] items, if any, that management believes are not representative of the underlying results of operations due to the nature or size of these [removed: matters.][added: matters.*]

See Note [removed: 23] [added: 15] to the Consolidated Financial Statements for [removed: descriptions of special items.*][added: additional information.]

*The term [removed: “Adjusted revenues”] [added: adjusted revenues] is defined as total revenues excluding the following adjustments: revenue [removed: contributions] [added: contribution] from transitioning [removed: clients,] [added: clients prior to 2020,] special items and Cigna’s share of certain realized investment results of its joint ventures reported in the International Markets segment using the equity method of accounting.

Cigna Corporation, together with its subsidiaries (either individually or collectively referred to as “Cigna,” the “Company,” “we,” “our” or “us”) is a global health [removed: service] [added: services] organization [removed: dedicated to] [added: with] a mission of helping those we serve improve their health, well-being and peace of mind.

[removed: Our evolved strategy in support of our mission is Go Deeper, Go Local, Go Beyond using] [added: We offer] a differentiated set of pharmacy, medical, [removed: dental, disability, life and accident insurance] [added: dental] and related products and services offered by our subsidiaries.

Results for [removed: the year ended December 31, 2019 included the results of Express Scripts’ business, whereas results for] 2018 only [removed: reflected] [added: include] Express [removed: Scripts’ results] [added: Scripts] for the period following the acquisition on December 20, [removed: 2018 and were not included in 2017.][added: 2018.]

[added: |] Financial Summary [added: | | | | | | 2020 | | | | | | 2019 | | | | | | 2018 | | |]

Summarized below are certain key measures of our performance [added: by segment] for the years ended December 31:

| | | [added: | | | | | | | | | | | | | | | | | | | | | | | | |] For the Years Ended December 31, | | | | | | | [added: | | | | | | | | | | |] Increase (Decrease) | | | [added: | | |] Increase (Decrease) | | [added: | | | |]

| *(Dollars in millions, except per share amounts)* | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | 2020 | | | | | |] 2019 | | [added: | | | |] 2018 | | [removed: 2017] | | [added: | | 2020 vs. 2019 | | | | | |] 2019 vs. 2018 | | | [removed: 2018 vs. 2017] | | [added: |]

| Revenues | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Adjusted revenues by segment | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [removed: Integrated] [added: U.S.] Medical | | | [removed: 36,519] | | [added: | | | | | | | | | | | | | | | | | | | | | | 38,451 | | | | | | 36,519 | | | | | |] 32,791 | | [removed: 29,035] | | [added: | | 5 | | | | | |] 11 | [removed: %] | | [removed: 13] [added: %] | | [added: |]

| International Markets | | | [removed: 5,615] | | [added: | | | | | | | | | | | | | | | | | | | | | | 5,877 | | | | | | 5,615 | | | | | |] 5,366 | | [removed: 4,901] | | [added: | |] 5 | | | [removed: 9] | | [added: | 5 | | | | | |]

| Group Disability and Other | | | [removed: 5,182] | | [added: | | | | | | | | | | | | | | | | | | | | | | 5,264 | | | | | | 5,182 | | | | | |] 5,061 | | [removed: 5,075] | | [added: | |] 2 | | | [removed: \-] | | [added: | 2 | | | | | |]

| Corporate, net [added: of] eliminations | | | [removed: (3,588)] | | [added: | | | | | | | | | | | | | | | | | | | | | | (5,655) | | | | | | (3,588) | | | | | |] (1,713) | | [removed: (1,446)] | | [added: | | (58) | | | | | |] (109) | | | [removed: (18)] | | [added: |]

| Adjusted revenues | | | [removed: 140,175] | | [added: | | | | | | | | | | | | | | | | | | | | | | 160,067 | | | | | | 140,175 | | | | | |] 48,111 | | [removed: 41,806] | | [added: | | 14 | | | | | |] 191 | | | [removed: 15] | | [added: |]

| Revenue [removed: contributions] [added: contribution] from transitioning clients | | | [removed: 13,347] | | [added: | | | | | | | | | | | | | | | | | | | | | | — | | | | | | 13,347 | | | | | |] 459 | | [removed: \-] | | [added: | |] N/M | | | [added: | | |] N/M | | [added: | | | |]

| Net realized investment results from certain equity method investments | | | [removed: 44] | | [added: | | | | | | | | | | | | | | | | | | | | | | 130 | | | | | | 44 | | | | | |] (43) | | [removed: \-] | | [removed: N/M] | | [added: 195] | [added: | | | | |] N/M | | [added: | | | |]

| Total revenues | | [added: | | | | | | | | | | | | | | | | | | | | | | | | |] $ | [removed: 153,566] [added: 160,401] | [added: | | | |] $ | [removed: 48,650] [added: 153,566] | [added: | | | |] $ | [removed: 41,806] [added: 48,650] | | [removed: 216] | [added: | | 4 | | |] % | | [removed: 16] | [added: 216 | | |] % | [added: | |]

| Shareholders’ net income | | [added: | | | | | | | | | | | | | | | | | | | | | | | | |] $ | [removed: 5,104] [added: 8,458] | [added: | | | |] $ | [removed: 2,637] [added: 5,104] | [added: | | | |] $ | [removed: 2,237] [added: 2,637] | | [removed: 94] | [added: | | 66 | | |] % | | [removed: 18] | [added: 94 | | |] % | [added: | |]

| Adjusted income from operations | | [added: | | | | | | | | | | | | | | | | | | | | | | | | |] $ | [removed: 6,476] [added: 6,795] | [added: | | | |] $ | [removed: 3,557] [added: 6,476] | [added: | | | |] $ | [removed: 2,668] [added: 3,557] | | [removed: 82] | [added: | | 5 | | |] % | | [removed: 33] | [added: 82 | | |] % | [added: | |]

| | | | | | |

| --- | --- | --- | --- | --- | --- |

| | | | | | |

| | | | | | |

| *[Evernorth](#ic5b0f4c2cee8492e9ee4ea74564c54b2_163)* | | | [68](#ic5b0f4c2cee8492e9ee4ea74564c54b2_163) | | |

| *[U.S. Medical](#ic5b0f4c2cee8492e9ee4ea74564c54b2_166)* | | | [70](#ic5b0f4c2cee8492e9ee4ea74564c54b2_166) | | |

| *[Corporate](#ic5b0f4c2cee8492e9ee4ea74564c54b2_175)* | | | [73](#ic5b0f4c2cee8492e9ee4ea74564c54b2_175) | | |

| | | | | | |

In some of our financial tables in this MD&A, we present either percentage changes or “N/M” when those changes are so large as to become not meaningful.

COVID-19 Update

The novel strain of coronavirus (“COVID-19”) was declared a pandemic by the World Health Organization in March 2020.

From the onset of the COVID-19 pandemic we have taken actions to drive affordability, reduce uncertainty and make health care easier.

For customers, these actions include COVID-19 related cost share waivers, expanded access to virtual care, support for access to medication and advocating for whole person health through various behavioral health initiatives.

We have supported the medical community by simplifying processes and donating medications for a COVID-19 clinical trial.

Cigna and the Cigna Foundation have assisted our communities through several initiatives including the launch of the Brave of Heart Fund that provides financial assistance to survivors of front-line U.S. health care workers who gave their lives in the fight against COVID-19.

Cigna also provides emotional support services to their families.

The Evernorth team launched ParachuteRx, a drug cost assistance program to certain customers without health coverage due to furlough or job loss.

Cigna Medical Group was among the first in the United States to administer antibody therapies to high-risk COVID-19 patients in a non-hospital setting.

Cigna also partnered with other organizations on digital access to vaccination records for those who have received the COVID-19 vaccine to facilitate return to work and daily activities.

We have continued to support our workforce by enabling remote work where appropriate, and implemented enhanced safety protocols and programs that support the health and mental well-being of our employees.

We have continued to execute our business continuity plans over our operations such as leveraging purchasing volume across the pharmaceutical supply chain in order to mitigate risk associated with prescription drug supply.

We did not incur significant disruptions to our operations during 2020 from COVID-19.

We will continue to work with our clients, customers, providers and employees to provide support during the pandemic.

The COVID-19 pandemic has pervasively impacted the economy, financial markets and the global health care delivery systems.

The effects of the COVID-19 pandemic on the Company began to emerge in the United States at the end of the first quarter and were not material to the Company's results of operations or financial condition for that period.

Beginning in April, we experienced a significant deferral of care by our customers.

The deferral of care moderated over the course of the second quarter with utilization levels eventually returning to nearly normal levels by the end of June.

In the third quarter, we experienced increased medical utilization as we observed a reduction to the level of deferred care and our customers sought care for COVID-19 testing and treatment.

In the fourth quarter, as COVID-19 cases increased, the costs for testing and treatment exceeded the savings related to the deferral of care.

These impacts were most prevalent in the U.S. Medical segment where fourth quarter earnings were adversely impacted by increased costs of COVID-19 care and decreased contributions from our specialty products.

Full year U.S. Medical results reflect COVID-19 impacts of deferral of care by our customers partially offset by the cost of COVID-19 care, the cost of COVID-19 related actions including premium relief programs for employer clients, cost share waivers for customers, customer disenrollment and actions to support providers and employees.

Our Group Disability and Other results reflect significantly elevated life insurance claims related to the COVID-19 pandemic and its effects in the third and fourth quarters.

Quarterly and year-to-date earnings in our Evernorth segment also reflected effects of the pandemic, specifically, a favorable mix of claims as a result of both the type of drugs dispensed as well as the distribution method used for dispensing and fulfilling, partially offset by lower 30-day retail script volume.

Segment results are discussed further in the "Segment Reporting" section of this MD&A and discussion of the impact of COVID-19 on our investment portfolio and related considerations regarding our investment outlook can be found in Note 11 to the Consolidated Financial Statements and in the "Investment Assets" discussion of this MD&A.

While it is difficult to predict the impact of the COVID-19 pandemic on our results beyond 2020, we believe that such results may be impacted by, among other things, higher medical costs to treat those affected by the virus, lower customer volumes due to rising unemployment, lower future risk adjustment revenue due to disrupted care impeding appropriate documentation of customer risk profiles in our Medicare Advantage business, the return of costs for those who had previously deferred care, vaccine costs, continued cost share waivers, the potential for continued deferral of care, or lower investment returns.

Cigna has taken actions to enhance our liquidity that, combined with our other sources of liquidity described in the "Liquidity and Capital Resources Outlook" section below, and our current projections for operating cash flows, we believe are sufficient to support our operations and meet our obligations.

The situation surrounding COVID-19 remains fluid, and we are actively managing our response and assessing impacts to our financial position and operating results, as well as adverse developments in our business.

For further information regarding the potential impact of COVID-19 on the Company, see “Risk Factors” contained in Part I, Item 1A of this Form 10-K.

Financial Highlights

Unless otherwise specified, the commentary provided below describes our results for the year ended December 31, 2020 compared with the year ended December 31, 2019.

| --- | --- |

| [*Health Services*](#TOC2_Health_Services) | [67](#TOC2_Health_Services) |

| [*Integrated Medical*](#TOC2_Integrated_Medical) | [69](#TOC2_Integrated_Medical) |

| [*Corporate*](#TOC2_Corporate) | [72](#TOC2_Corporate) |

| | |

As discussed in Note 23 to the Consolidated Financial Statements, effective in the first quarter of 2019, compensation cost for stock options is now recorded by our segments.

Prior year segment information has not been restated for this change.

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Health Services | | $ | 96,447 | $ | 6,606 | $ | 4,241 | | N/M | | | 56 | % |

| Special items reported in integration and transaction-related costs (1) | | | \- | | 123 | | \- | | N/M | | | N/M | |

| Health Services | | $ | 5,092 | $ | 380 | $ | 288 | | N/M | | | 32 | % |

| | | | | | | | | | | | | | |

| *(1) Comprised of net investment income included in integration and transaction-related costs; please refer to Note 4 to the Consolidated Financial Statements in this Form 10-K for additional information.* | | | | | | | | | | | | | |

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| \- Long-term care guaranty fund assessment | | | \- | | \- | | 83 | | | \- | | \- | | 0.32 | |

Earnings and Revenue

Shareholders’ net income increased, primarily driven by the earnings contribution from Express Scripts and improved results in the Integrated Medical segment partially offset by interest expense on debt issued to finance the Express Scripts acquisition.

Earnings per share also increased, but at a significantly lower rate, reflecting dilution from the shares issued in connection with the Express Scripts acquisition.

Adjusted income from operations increased, primarily driven by earnings from Express Scripts’ pharmacy benefits and health management businesses reported in the Health Services segment and improved results in Integrated Medical.

These favorable results were partially offset by higher interest expense reported in Corporate from both debt issued to finance the acquisition and debt assumed from Express Scripts.

Adjusted income from operations per share also increased, but at a significantly lower rate, reflecting dilution from the shares issued to acquire Express Scripts.

Medical customers increased, primarily attributable to growth in the Select and Middle Market segments, partially offset by a decline in the National Accounts and Individual market segments.

Revenue growth primarily reflected the addition of Express Scripts and, to a lesser extent, business growth in the Integrated Medical segment.

Detailed revenue items are discussed further below.

oPharmacy revenues in 2019 reflected the Express Scripts pharmacy benefit management business.

In 2018, we reported pharmacy revenues from Express Scripts for the period following the acquisition on December 20, 2018.

oPremiums increased, primarily resulting from: 1) customer growth across all segments, predominantly Integrated Medical 2) rate increases in Integrated Medical reflecting underlying medical cost trends and 3) the addition of Express Scripts’ Medicare Part D business.

oFees and other revenues increased primarily driven by contributions from Express Scripts’ health management business reported in the Health Services segment.

Higher fees in our Integrated Medical segment primarily driven by growth in our specialty businesses also contributed to the increase.

oNet investment income decreased, primarily reflecting the absence of investment income earned in the fourth quarter of 2018 on debt proceeds used to acquire Express Scripts in December 2018.

Other Components of Consolidated Results of Operations

Pharmacy and other service costs. In 2019, this amount was primarily comprised of the Express Scripts’ pharmacy benefits and health management businesses reported in the Health Services segment.

In 2018, we reported activity from Express Scripts for the period following the acquisition on December 20, 2018.

Medical costs and other benefit expenses increased, primarily due to medical cost inflation in Integrated Medical, customer growth in the insured business and the addition of Express Scripts’ Medicare Part D business.

Selling, general and administrative expenses increased, primarily due to the addition of Express Scripts and, to a lesser extent, volume-related expenses in Integrated Medical.

These increases were partially offset by suspension of the health insurance industry tax in 2019.

Amortization of acquired intangible assets in 2019 primarily reflected the impact of the Express Scripts acquisition.

Interest expense and other increased significantly, primarily due to interest incurred on debt issued in the third quarter of 2018 to finance the Express Scripts acquisition and interest incurred on Express Scripts’ debt assumed upon closing of the acquisition.

| | [added: | |] Our [added: Purpose and] Mission To improve the health, well-being and peace of mind of those we serve | | [added: | | | |]

| | [added: | |] Our Strategy | | [added: | | | |]

[removed: We have broad] [added: Cigna is a global health services company uniquely capable of driving affordable, predictable,] and [added: simple health care, with expansive and] deep capabilities that accelerate our strategy to achieve our mission of improving [removed: the] health, well-being and peace of [removed: mind of those we serve.][added: mind.]

Cigna’s employees are champions for the people we serve and over the past decade, our focus has shifted to helping [removed: people] [added: individuals and families] thrive by offering solutions to prevent and better manage health challenges.

When sickness or disability do occur, we support our [removed: customers’ ability to have] [added: customers by offering] broad choices [removed: in how they] [added: to help them] best access high quality, [removed: affordable] [added: affordable, whole person] care.

We see three primary ways to help individuals maintain, improve or recover their physical or mental health: 1) behavioral and lifestyle changes – with [removed: over] [added: more than] 1,000 health coaches helping individuals set and meet health goals; 2) [removed: pharmaceutical interventions] [added: affordable, effective medication options] – with [added: access to] our leading pharmacy services improving health and driving affordability; and 3) [added: targeted] medical and surgical interventions – with a clear and proven strategy around partnerships and value-based care [added: quality] programs, powered by [removed: applied informatics] [added: data] and [added: analytics and] aligned incentives.

We maximize use of evidence-based care, while delivering best-in-class [removed: quality of care] [added: service] for our customers with acute and chronic conditions through enhanced real-time [removed: data] [added: insights] across an expanded platform with industry-leading solutions to support care decisions.

Our capabilities include: 1) a broad portfolio of [removed: specialty] [added: solutions and] services, some of which can be offered on a stand-alone basis; 2) integrated behavioral, medical and pharmacy management [removed: services;] [added: solutions;] 3) leading specialty [removed: pharmacy] [added: pharmacy, clinical and care management] expertise; and 4) advanced analytics that help us engage more meaningfully with individuals, plan sponsors we serve and our provider partners.

We put medicine within reach for [removed: patients] [added: patients,] and help providers improve access to prescription [removed: drugs] [added: drugs,] by making them more affordable.

We present the financial results of our businesses in the following [removed: segments:][added: segments (see "Executive Overview" section of the MD&A located in Part II, Item 7 of this Form 10-K for a Financial Summary):]

[removed: Health Services includes] [added: The comprehensive suite of] pharmacy [added: management services available to clients and customers, utilizing Evernorth's capabilities, includes] benefits management, specialty pharmacy services, clinical solutions, home delivery and [added: certain] health management services.

[removed: This segment provides deeply integrated medical] [added: U.S. Commercial products] and [removed: specialty offerings including] [added: services include] medical, pharmacy, behavioral health, dental, vision, health advocacy programs and other products and services [removed: to] [added: for] insured and self-insured [removed: clients.][added: customers.]

[removed: The Government operating segment offers] [added: U.S. Government solutions include] Medicare Advantage, Medicare Supplement, and Medicare Part D plans [removed: (including the acquired Express Scripts’ Medicare Part D business)] for seniors, Medicaid [removed: plans] [added: plans,] and individual health insurance [removed: coverage] [added: plans] both on and off the public exchanges.

[removed: Group] [added: - Group] Disability and Life provides group long-term and short-term disability, group life, accident, voluntary and specialty insurance products and related services.

[removed: Corporate-Owned] [added: - Corporate-Owned] Life Insurance (“COLI”) offers permanent insurance contracts sold to corporations to provide coverage on the lives of certain employees for financing employer-paid future benefit obligations.

[removed: Run-off] [added: - Run-off] businesses:

[removed: Reinsurance:] [added: - Reinsurance:] predominantly comprised of guaranteed minimum death benefit (“GMDB”) and guaranteed minimum income benefit (“GMIB”) business effectively exited through reinsurance with Berkshire Hathaway Life Insurance Company of Nebraska (“Berkshire”) in 2013.

[removed: Settlement] [added: - Settlement] Annuity business in run-off.

[removed: Individual] [added: - Individual] Life Insurance and Annuity and Retirement Benefits Businesses: comprised of deferred gains from the sales of these businesses.

The financial information included in this Form 10-K for the fiscal year ended December 31, [removed: 2019] [added: 2020] is in conformity with accounting principles generally accepted in the United States of America (“GAAP”) unless otherwise indicated.

Industry rankings and percentages set forth herein are for the year ended December 31, [removed: 2019] [added: 2020] unless otherwise indicated.

Halfmoon Parent, Inc. was renamed Cigna Corporation [added: and Cigna Holding Company became its subsidiary] concurrent with the consummation of the combination with Express Scripts on December 20, 2018.

We make annual, quarterly and current reports and proxy statements and amendments to those reports available, free of charge through our website (http://www.cigna.com, under the “Investors—Quarterly Reports and SEC Filings” captions) as soon as reasonably practicable after we electronically file these materials with, or furnish them to, the Securities and Exchange Commission [removed: (the “SEC”).][added: (“SEC”).]

In [removed: 2019, Health Services] [added: 2020, Evernorth] reported adjusted revenues of [removed: $96.4] [added: $116.1] billion and pre-tax adjusted income from operations of [removed: $5.1] [added: $5.4] billion.

| HOW WE WIN | [added: | |]

| [removed: Creating] [added: Evernorth accelerates delivery of] innovative [added: and flexible] solutions [added: to create value and meet the diverse needs of health plans, employers, health care providers and government organizations by: ·Partnering in unconventional ways to solve complex problems across a fragmented health care ecosystem, fueled by connected data and expertise] that [removed: improve patient outcomes] [added: drives purposeful innovation ·Creating flexible] and [removed: control costs Evaluating medicines] [added: focused solutions tailored to client needs, using Evernorth's combined strengths and capabilities, as well as strategic partnerships, to deliver: better, more efficient care] for [added: patients; better experiences for clients, providers and customers; and enhanced choices for clients and customers through our open architecture model ·Evaluating medicines, digital therapeutics and other health solutions for] efficacy, [added: adherence,] value and price to assist clients in selecting a cost-effective formulary [removed: Offering] [added: ·Offering] home delivery and specialty [removed: services] [added: customer-centric solutions] that [removed: save money for] [added: meet the needs of our] clients and [removed: customers,] [added: customers in ways that unlock greater value and better health services] while providing better and specialized clinical care [removed: Leveraging] [added: ·Aggregating] purchasing volume to deliver discounts and drive risk-sharing and value-based care across the pharmaceutical supply chain [removed: Promoting] [added: ·Promoting] the use of generics and lowest-cost, clinically effective brands of medications | [added: | |]

| Principal Products & Services | [removed: Brands/ Subsidiaries] | [added: | | | | Brands/ Subsidiaries | | |] Key Relationships | [added: | |] Primary Competitors | [added: | |]

| Pharmacy [removed: Dispensing] [added: Solutions] | [added: | | | | | Express Scripts Pharmacy,] Accredo®, [added: Freedom Fertility Pharmacy®,,] Therapeutic Resource [removed: Centers®, Express Scripts Pharmacy SM, Cigna Home Delivery Pharmacy] [added: Center®] | [added: | |] Clients, Customers, [added: Health Care] Providers | [added: | |] Independent Pharmacy Benefit Managers (“PBMs”), Managed Care PBMs, Retail Pharmacies, Specialty Pharmacies | [added: | |]

| [removed: Supply] [added: Supply] Chain Administration and [removed: Management] [added: Network Management] | [added: | | Value Based Programs (Express Scripts SafeGuardRx®, Patient AssuranceSM), National Preferred Formulary, SaveOnSP,] Express [removed: Scripts, Smart90®, SmartShareRx®,] [added: Scripts MedRx ManagementSM, Express Scripts Parachute RxSM,] Ascent Health Services, [removed: Econdisc] [added: Econdisc, Inside Rx®] | [added: | |] Clients, [removed: Customers] [added: Self-paying customers (InsideRx only), Pharmacy Providers] | [added: | | Health Plans,] Independent PBMs, Managed Care PBMs, Third Party Benefit Administrators, Group Purchasing Organizations | [added: | | | | |]

| [removed: Clinical] [added: Care] Solutions | [added: | | | | | Evernorth Healthy Ways to WorkSM, inMyndSM,] Health Connect 360SM, [added: Evernorth Digital Health FormularySM,] Advanced Utilization Management, [removed: Express Scripts Digital Health Formulary,] [added: Enhanced] Fraud, Waste & [removed: Abuse] [added: Abuse, Advanced Opioid Management®, ScreenRx®, Behavioral Health] | [added: | |] Clients, Customers | [added: | |] Independent PBMs, Managed Care PBMs, Third-Party Benefit Administrators | [added: | |]

| Provider Services | [added: | | | | |] CuraScript SD® | [added: | |] Health Care Providers, Clinics, Hospitals | [added: | |] Specialty Drug Distributors | [added: | |]

| [removed: Health Benefit] [added: Benefits] Management [removed: Services] [added: Solutions] | [added: | | Pharmacy and Medical Benefits Management | | |] eviCore [added: Healthcare®, Express Scripts PBM, myMatrixx®, Care Continuum®, Evernorth Embarc Benefit ProtectionSM, Evernorth FamilyPathSM] | [added: | | Clients, Customers,] Health [added: Care Providers, Consultants, Health] Plans, Commercial and Government Payors | [added: | |] Health Plans, [added: Independent PBMs, Managed Care PBMs,] Third-Party [removed: Benefits] [added: Benefit] Administrators, [added: Group Purchasing Organizations,] Clinical Solutions and Health Care Data Analytics Companies | [added: | |]

[removed: *Pharmacy Benefit Management Services:* Our services drive high-quality, cost-effective care through prescription drug utilization and cost management*.*] We support our [removed: clients’] [added: clients'] plan design selections to deliver balanced affordability, choice, simplicity and convenience.

We focus our solutions to align with our [removed: clients’ needs across care, cost] [added: clients' service, care] and [removed: service.][added: cost management needs.]

[added: - *Pharmacy Solutions:*] The [removed: home delivery] pharmacy operations [removed: of our Health Services segment] consist of [removed: eight] [added: ten] order processing pharmacies, [removed: eight] [added: five] patient contact [removed: centers] [added: centers, 26 specialty branch pharmacies] and [removed: four] [added: 11] high-volume automated home delivery [added: and specialty] dispensing pharmacies located throughout the United States.

[removed: Health Services’ home delivery dispensing] [added: Dispensing] pharmacies are located in Arizona, [added: Delaware, Florida,] Indiana, [removed: Missouri and] [added: Massachusetts, Missouri,] New [removed: Jersey.][added: Jersey, Pennsylvania and Tennessee.]

[removed: We are directly involved with the prescriber and customer through our home delivery pharmacies and our] [added: Our] research shows that [removed: we achieve] [added: Express Scripts Pharmacy achieves] a higher level of [removed: generic substitutions,] therapeutic [removed: interventions and] [added: interventions,] better adherence [added: and cost savings] than is achieved through retail pharmacy networks.

[removed: *oSpecialty] [added: ◦*Specialty] Pharmacy Services:* Specialty medications are [removed: used] primarily [added: characterized as high-cost medications] for the treatment of complex [added: and rare] diseases.

These medications [removed: are] broadly [removed: characterized to] include those with frequent dosing adjustments, intensive clinical monitoring, the need for customer training, specialized product administration requirements or medications limited to certain [removed: specialty pharmacy networks by manufacturers.]

Through a combination of assets and capabilities, we provide an enhanced level of predictable care and therapy management for customers taking specialty [removed: medications and] [added: medications,] increased visibility and improved outcomes for payors, [removed: as well as] [added: and] custom programs for biopharmaceutical manufacturers.

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Champions for affordable, predictable, and simple health care | | | | | | | | |

| Making it affordable: We build on our leading, differentiated position to lower the total cost of care. | | | | | | | | |

| | | | Making it predictable: We take the surprise out of the system and help people make informed health care choices. | | | | | |

| | | | Making it simple: We make it easier for the people we serve to get the care they need. | | | | | |

Our portfolio of offerings solves diverse challenges across the health care system.

We offer a differentiated set of pharmacy, medical, behavioral, dental and supplemental products and services, primarily through two brands: Cigna and Evernorth.

In 2020 Cigna launched Evernorth, a new health services platform, and renamed the Health Services segment as Evernorth, accordingly.

Evernorth brings together our array of health services capabilities, as well as those from partners across the health care system in pharmacy solutions, benefits management solutions, care solutions and intelligence solutions.

Innovative products include: Healthy Ways to WorkSM, a broad suite of solutions to help health plans and employers move forward by addressing unique challenges resulting from the COVID-19 pandemic; FamilyPathSM, a comprehensive fertility solution to reduce avoidable costs, provide holistic care coordination and deliver more flexible options for individuals; and inMyndSM, a solution that helps clients and customers better recognize, treat and support mental health conditions.

Evernorth includes a broad range of coordinated and point solution health services, including pharmacy solutions, benefits management solutions, care solutions and intelligence solutions, which are provided to health plans, employers, government organizations and health care providers.

U.S. Medical includes Cigna’s U.S. Commercial and U.S. Government businesses that provide comprehensive medical and coordinated solutions to clients and customers.

The sale of this business to New York Life was completed on December 31, 2020.

The transaction with New York Life included the sale of our businesses offering group long-term and short-term disability, group life, accident, and specialty insurance products and related services.

Our business that offers group voluntary products and services was not sold to New York Life and results of this business will be reported in the U.S. Medical segment beginning in the first quarter of 2021.

See Note 5 to the Consolidated Financial Statements and Liquidity section of the MD&A for additional information on the impacts of this sale on our results of operations, liquidity and financial position.

In 2020, our business was impacted by the emergence and unprecedented global spread of the novel strain of coronavirus ("COVID-19").

COVID-19 was declared a pandemic by the World Health Organization in March 2020 because the virus had surfaced in nearly all regions around the world.

The COVID-19 pandemic has pervasively impacted the economy, financial markets and the global health care delivery systems.

Cigna’s COVID-19 response actions focused on customer care, employee care and safety, as well as support for the medical community and execution of business continuity plans over our operations.

COVID-19 continues to spread and we are actively managing our response and assessing impacts to our financial position and operating results, as well as adverse developments in our business.

While it is difficult to predict the impact of the COVID-19 pandemic on our results beyond 2020, we believe that such results may be impacted by, among other things, higher medical costs to treat those affected by the virus, lower customer volumes due to rising unemployment, lower future risk adjustment revenue due to disrupted care impeding appropriate documentation of customer risk profiles in our Medicare Advantage business, the return of costs for those who had previously deferred care, vaccine costs, continued cost share waivers, the potential for continued deferral of care, or lower investment returns.

Additionally, in response to the pandemic, U.S. federal and state governments have enacted new regulatory requirements as discussed in the "Business - Regulation" section of this Form 10-K.

EVERNORTH

Evernorth brings together coordinated and point solution health services including pharmacy solutions, benefits management solutions, care solutions and intelligence solutions, and specialized expertise – from inside and outside the company – to deliver custom and flexible solutions that meet the needs of our clients and customers.

| | | |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Evernorth Intelligence Solutions | | | | | | Express Scripts Lab, RationalMed®, MediCUBE®, Express Scripts ScriptVisionSM | | | Health Care Providers, Clients | | | Health Care Data Analytics Companies | | |

◦*Express Scripts Pharmacy:* Express Scripts Pharmacy dispenses approximately 1.5 billion adjusted prescriptions(1) annually to members of pharmacy plans managed by our Express Scripts PBM.

The service offers free standard shipping of maintenance medications nationwide, usually in a 90-day supply, directly to the customer's home.

The service allows for automatic refills on eligible medications and unrestricted telephone access to specially trained pharmacists who can help answer customer questions.

The front-end of our pharmacy is organized in Therapeutic Resource Centers, where specialized pharmacists focus their practice of pharmacy by condition, which offers customers a more personalized experience, while providing enhanced clinical care.

Our differentiated practice of pharmacy, coupled with our advanced automated dispensing technology, results in safer and more accurate pharmacy operations when compared to retail pharmacies, convenient access to maintenance medications and better management of our clients' drug costs through operating efficiencies and generic substitutions.

*(1)* *Non-specialty network scripts filled through 90-day programs and home delivery scripts are multiplied by three.

All other network and specialty scripts are counted as one script.*

specialty pharmacy networks by manufacturers.

Drug manufacturers occasionally select Accredo for exclusive dispensing of a highly specialized therapy.

Freedom Fertility Pharmacy is dedicated exclusively to supporting patients undergoing fertility treatment.

| Go Deeper: To expand and deepen our customer, client and partner relationships and create depth in targeted sub-segments and geographies | | |

| | Go Local: To ensure our solution suite and services meet customer, client and partner needs at a local market level | |

| | Go Beyond: To innovate and further differentiate our businesses, the experiences we deliver and our overall social impact | |

| | How We Win  | |

Cigna is an enterprise uniquely capable of delivering affordability, predictability and simplicity of health care to those we serve.

We offer a differentiated set of pharmacy, medical, behavioral, dental, disability, life and accident insurance and related products and services.

These capabilities enhance Cigna’s ability to drive improved cost affordability, quality of care and predictability.

We improve patient outcomes and better manage the cost of the pharmacy benefit by:

Identifying products and offering innovative solutions that improve patient outcomes and control costs

Evaluating medicines for efficacy, value and price to assist clients in selecting a cost-effective formulary

Offering home delivery and specialty services that save money for clients and customers while providing better and specialized clinical care

Leveraging purchasing volume to deliver discounts drive risk-sharing and value-based care across the pharmaceutical supply chain

Promoting the use of generics and lowest cost, clinically effective brands of medications

In 2019, we launched three major initiatives: 1) the Patient AssuranceSM program that offers diabetic customers a low, fixed monthly out-of-pocket cost for insulin; 2) the Embarc Benefit ProtectionSM program that improves care, access and affordability for potentially life-changing medicines that are extremely costly and 3) our Digital Health Formulary that helps clients and customers get the most value from innovative digital health products.

Plan sponsors and participants can achieve the best health and financial outcomes when they use our comprehensive set of solutions to manage drug spend.

Integrated Medical offers a variety of health care solutions to employers and individuals.

The Commercial operating segment serves employers (also referred to as “clients”) and their employees (also referred to as “customers”) and other groups.

HEALTH SERVICES

This segment consists of pharmacy benefit management, home delivery and specialty pharmacy and certain health management services.

| --- |

The following chart depicts a high-level summary of our principal products and services in this segment with definitions on subsequent pages.

| --- | --- | --- | --- |

| Value-Based Programs | SafeGuardRx®, Express Scripts Patient AssuranceSM,Embarc Benefit Protection SM | Clients, Customers | Independent PBMs, Managed Care PBMs |

Health Services also has seven specialty home delivery pharmacies and 38 specialty branch pharmacies.

*Pharmacy Dispensing:*

*oHome Delivery Pharmacy* *Services:* In addition to the order processing that occurs at our home delivery pharmacies, we operate several non-dispensing prescription processing facilities and customer contact centers.

Our pharmacies provide greater safety and accuracy than retail pharmacies, convenient access to maintenance medications and better management of our clients’ drug costs through operating efficiencies.

Accredo supports successful outcomes for c

oThrough the Express Scripts Digital Health FormularySM offering, we evaluate digital health solutions available on the market, providing a list to clients of solutions that provide clinical effectiveness, data security, user-friendly experience and financial value.

Other solutions include RationalMed®, ScreenRx®, Express*Alliance*®, Advanced Opioid Management®, and OnePASM offerings, as well as Medication Therapy and Medical Benefit Drug Management.

Through our Therapeutic Resource Center® offering, we provide caring for customers with the most complex and costly chronic conditions including cardiovascular disease, diabetes, cancer, HIV, asthma, depression and other rare and specialty conditions.

Notably, our programs covering oncology and inflammatory conditions have introduced a value-based contracting approach with payments now tied to a product’s effectiveness.

*oEmbarc Benefit Protection*SM: This program combines health benefit management, health services and specialty pharmacy capabilities to make emerging gene therapy treatments more affordable for the payor, the employer and the patient.

eviCore manages: diagnostic imaging, comprehensive musculoskeletal disorders, sleep disorders, post-acute care, genetic lab, specialty pharmacy and medical oncology.

Competition

*Retail Pharmacies:* CVS Caremark, Walgreens Boots Alliance, Inc. and WalMart, Inc.

Our clinical solutions staff of pharmacists and physicians provides clinical development and operational support for our pharmacy benefit management services.

Other names and marks referenced herein are the property of their respective owners.

INTEGRATED MEDICAL

Integrated Medical consists of a Commercial operating segment that includes our employer-sponsored medical coverage and a Government operating segment that includes Medicare offerings for seniors and individual insurance offerings both on and off the public health insurance exchanges.

The information contained under Litigation Matters and Regulatory Matters in Note [removed: 22] [added: 21] to the [added: Consolidated] Financial Statements of this Form [removed: 10-K,] [added: 10-K] is incorporated herein by reference.

[removed: ][added: ]

| ☒ | [added: | |] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | [added: | |]

| For the fiscal year ended December 31, [removed: 2019] [added: 2020] | | [added: | | | |]

| ☐ | [added: | |] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | [added: | |]

| Delaware | [added: | |] 82-4991898 | [added: | |]

| (State or other jurisdiction of incorporation or organization) | [added: | |] (I.R.S. Employer Identification No.) | [added: | |]

| 900 Cottage Grove Road, Bloomfield, Connecticut | [added: | |] 06002 | [added: | |]

| (Address of principal executive offices) | [added: | |] (Zip Code) | [added: | |]

| [removed: (860) 226-6000] [added: (860) 226-6000] | | [added: | | | |]

| Registrant’s telephone number, including area code | | [added: | | | |]

| Securities registered pursuant to Section 12(b) of the Act: | | | [added: | | | | | |]

| Title of each class | [added: | |] Trading Symbol(s) | [added: | |] Name of each exchange on which registered | [added: | |]

| Common Stock, Par Value $0.01 | [added: | |] CI | [added: | |] New York Stock Exchange, Inc. | [added: | |]

| Securities registered pursuant to Section 12(g) of the Act: | [added: | |]

| NONE | [added: | |]

| Indicate by check mark | | | | | [added: | | | | | | | | | |] Yes | [added: | |] No | [added: | |]

| [removed: if] [added: •if] the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. | | | | | [added: | | | | | | | | | |] ☒ | [added: | |] ☐ | [added: | |]

| [removed: if] [added: •if] the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act | | | | | [added: | | | | | | | | | |] ☐ | [added: | |] ☒ | [added: | |]

| [removed: whether] [added: •whether] the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days | | | | | [added: | | | | | | | | | |] ☒ | [added: | |] ☐ | [added: | |]

| [removed: whether] [added: •whether] the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files) | | | | | [added: | | | | | | | | | |] ☒ | [added: | |] ☐ | [added: | |]

| [removed: whether] [added: •whether] the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. | | | | | | | [added: | | | | | | | | | | | | | |]

| Large accelerated filer | [added: | |] ☒ | [added: | |] Accelerated filer | [added: | |] ☐ | [added: | |] Non-accelerated filer | | [added: | | | |] ☐ | [added: | |]

| | | [added: | | | |] Smaller reporting company | [added: | |] ☐ | [added: | |] Emerging growth company | | [added: | | | |] ☐ | [added: | |]

| [removed: If] [added: •If] an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | | | | | [added: | | | | | | | | | |] ☐ | | [added: | | | |]

| [removed: whether] [added: •whether] the registrant is a shell company (as defined in Rule 12b-2 of the [removed: Act).] [added: Act)] | | | | | [added: | | | | | | | | | |] ☐ | [added: | |] ☒ | [added: | |]

The aggregate market value of the voting stock held by non-affiliates of the registrant as of June [removed: 28, 2019] [added: 30, 2020] was approximately [removed: $59.4] [added: $68.9] billion.

As of January 31, [removed: 2020, 372,043,094] [added: 2021, 351,845,606] shares of the registrant’s Common Stock were outstanding.

Part III of this Form 10-K incorporates by reference information from the registrant’s definitive proxy statement related to the [removed: 2020] [added: 2021] annual meeting of shareholders.

| FREQUENTLY REQUESTED 10-K INFORMATION | | [added: | | | |]

| | [added: | |] Page | [added: | |]

| [removed: [Risk Factors](#TOC1_Risk_Factors)] [added: Risk Factors] | [removed: [31](#TOC1_Risk_Factors)] | [added: | [34](#ic5b0f4c2cee8492e9ee4ea74564c54b2_205) | | |]

| [removed: [Executive Overview](#TOC2_Executive_Overview)] [added: Executive Overview] | [removed: [52](#TOC2_Executive_Overview)] | [added: | [53](#ic5b0f4c2cee8492e9ee4ea74564c54b2_133) | | |]

| [removed: [Industry Developments](#TOC1_Health_Care_Industry_Developments)] [added: Industry Developments] and Other Matters | [removed: [56](#TOC1_Health_Care_Industry_Developments)] | [added: | [58](#ic5b0f4c2cee8492e9ee4ea74564c54b2_136) | | |]

| [removed: [Liquidity] [added: Liquidity] and Capital [removed: Resources](#TOC2_Liquidity_and_Capital_Resources)] [added: Resources] | [removed: [58](#TOC2_Liquidity_and_Capital_Resources)] | [added: | [60](#ic5b0f4c2cee8492e9ee4ea74564c54b2_1926) | | |]

| [removed: [Critical] [added: Critical] Accounting [removed: Estimates](#TOC2_Critical_Accounting_Estimates)] [added: Estimates] | [removed: [63](#TOC2_Critical_Accounting_Estimates)] | [added: | [65](#ic5b0f4c2cee8492e9ee4ea74564c54b2_151) | | |]

| | | [added: | | | |] Page | [added: | |]

| [removed: |] [Cautionary [removed: Statement](#TOC1_Cautionary_Statement)] [added: Statement](#ic5b0f4c2cee8492e9ee4ea74564c54b2_238)] | | [added: | | | | | | |]

| [Item [removed: 1.](#TOC1_Item_1)] [added: 1.](#ic5b0f4c2cee8492e9ee4ea74564c54b2_241)] | [removed: [Business](#TOC1_Business)] | | [added: [Business](#ic5b0f4c2cee8492e9ee4ea74564c54b2_241) | | | [1](#ic5b0f4c2cee8492e9ee4ea74564c54b2_241) | | |]

| | [removed: .] [added: | |] [International [removed: Markets](#TOC1_International_Markets)] [added: Markets](#ic5b0f4c2cee8492e9ee4ea74564c54b2_253)] | [removed: [13](#TOC1_International_Markets)] | [added: | [15](#ic5b0f4c2cee8492e9ee4ea74564c54b2_253) | | |]

| | [removed: .] [added: | |] [Group Disability and [removed: Other](#TOC1_Group_Disability_and_Other)] [added: Other](#ic5b0f4c2cee8492e9ee4ea74564c54b2_256)] | [removed: [16](#TOC1_Group_Disability_and_Other)] | [added: | [17](#ic5b0f4c2cee8492e9ee4ea74564c54b2_256) | | |]

| | | | | | |

| --- | --- | --- | --- | --- | --- |

| OR | | | | | |

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| •whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report | | | | | | | | | | | | | | | ☒ | | | | | |

| | | | | | |

| --- | --- | --- | --- | --- | --- |

| Segment Information | | | [138](#ic5b0f4c2cee8492e9ee4ea74564c54b2_124) | | |

| Revenues by Product Type | | | [142](#ic5b0f4c2cee8492e9ee4ea74564c54b2_3447) | | |

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| [PART I](#ic5b0f4c2cee8492e9ee4ea74564c54b2_2693) | | | | | | | | |

| | | | [Overview](#ic5b0f4c2cee8492e9ee4ea74564c54b2_244) | | | [1](#ic5b0f4c2cee8492e9ee4ea74564c54b2_244) | | |

| | | | [Evernorth](#ic5b0f4c2cee8492e9ee4ea74564c54b2_247) | | | [3](#ic5b0f4c2cee8492e9ee4ea74564c54b2_247) | | |

| | | | [U.S. Medical](#ic5b0f4c2cee8492e9ee4ea74564c54b2_250) | | | [10](#ic5b0f4c2cee8492e9ee4ea74564c54b2_250) | | |

| | | | [Data, Analytics](#ic5b0f4c2cee8492e9ee4ea74564c54b2_1865) [and Technology](#ic5b0f4c2cee8492e9ee4ea74564c54b2_1865) | | | [19](#ic5b0f4c2cee8492e9ee4ea74564c54b2_1865) | | |

| | | | [Human Capital Management](#ic5b0f4c2cee8492e9ee4ea74564c54b2_2182) | | | [21](#ic5b0f4c2cee8492e9ee4ea74564c54b2_2182) | | |

| | | | [Miscellaneous](#ic5b0f4c2cee8492e9ee4ea74564c54b2_262) | | | [22](#ic5b0f4c2cee8492e9ee4ea74564c54b2_262) | | |

| | | | [Regulation](#ic5b0f4c2cee8492e9ee4ea74564c54b2_265) | | | [22](#ic5b0f4c2cee8492e9ee4ea74564c54b2_265) | | |

| | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| [PART II](#ic5b0f4c2cee8492e9ee4ea74564c54b2_2679) | | | | | | | | | | | |

| [Item 9B.](#ic5b0f4c2cee8492e9ee4ea74564c54b2_298) | | | [Other Information](#ic5b0f4c2cee8492e9ee4ea74564c54b2_298) | | | | | | [143](#ic5b0f4c2cee8492e9ee4ea74564c54b2_298) | | |

| | | | D. Delinquent Section 16(a) Reports | | | | | | | | |

| | | | | | | | | | | | |

| [PART IV](#ic5b0f4c2cee8492e9ee4ea74564c54b2_2652) | | | | | | | | | | | |

| [Signatures](#ic5b0f4c2cee8492e9ee4ea74564c54b2_325) | | | | | | | | | [156](#ic5b0f4c2cee8492e9ee4ea74564c54b2_325) | | |

| --- | --- |

| OR | |

| | |

| --- | --- | --- |

| --- |

| --- | --- | --- | --- | --- | --- | --- |

| [Segment Information](#TOC3_Segment_Information) | [143](#TOC3_Segment_Information) |

| [Revenues by Product Type](#TOC1_Revenues_By_Product_Type) | [145](#TOC1_Revenues_By_Product_Type) |

| [PART I](#TOC1_Part_I) | | |

| | .[Overview](#TOC1_Overview) | [1](#TOC1_Overview) |

| | . [Health Services](#TOC1_Health_Services) | [3](#TOC1_Health_Services) |

| | . [Integrated Medical](#TOC1_Integrated_Medical) | [8](#TOC1_Integrated_Medical) |

| | . [Miscellaneous](#TOC1_Miscellaneous) | [20](#TOC1_Miscellaneous) |

| | . [Regulation](#TOC1_Regulation) | [20](#TOC1_Regulation) |

| [PART II](#TOC1_Part_II) | | | |

| --- | --- | --- | --- |

| [Item 6.](#TOC1_Item_6) | [Selected Financial Data](#TOC1_Selected_Financial_Data) | | [50](#TOC1_Selected_Financial_Data) |

| | [Operations (“MD&A”)](#TOC1_Managements_Discussion_and_Analysis) | | [51](#TOC1_Managements_Discussion_and_Analysis) |

| | [Disclosure](#TOC1_Changes_in_and_Disagreements_with) | | [148](#TOC1_Changes_in_and_Disagreements_with) |

| [Item 9B](#TOC1_Other_Information). | [Other Information](#TOC1_Other_Information) | | [148](#TOC1_Other_Information) |

| | [D.](#TOC1_Item_10D) [Delinquent Section 16(a) Reports](#TOC1_Delinquent_Section_16a) | | [149](#TOC1_Delinquent_Section_16a) |

| | [Related Stockholder Matters](#TOC1_Security_Ownership) | | [150](#TOC1_Security_Ownership) |

| | | | |

| [PART IV](#TOC1_Part_IV) | | | |

| [Signatures](#TOC1_Signatures) | | | [163](#TOC1_Signatures) |

[removed: Our] [added: As of the end of fiscal year 2020, our] global real estate portfolio [removed: consists] [added: consisted] of approximately [removed: 12.9] [added: 12.4] million square feet of owned and leased properties.

Our domestic portfolio [removed: has] [added: had] approximately [removed: 10.9] [added: 10.5] million square feet in [removed: 43] [added: 42] states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands.

Our international properties contain approximately [removed: 2.0] [added: 2.1] million square feet located throughout the following countries: Australia, Bahrain, Belgium, Canada, China, France, Germany, Hong Kong, India, Indonesia, Kenya, Kuwait, Lebanon, Malaysia, [added: Netherlands,] New Zealand, Oman, Singapore, South Korea, Spain, Switzerland, Taiwan, Thailand, Turkey, United Arab [removed: Emirates,] [added: Emirates] and the United Kingdom.

Our principal domestic office locations include the Wilde Building located at 900 Cottage Grove Road in Bloomfield, Connecticut (our corporate headquarters), Two Liberty Place located at 1601 Chestnut Street in Philadelphia, Pennsylvania, and [removed: Express Scripts’] [added: Evernorth's] corporate offices located at and around One Express Way in St. Louis, Missouri.

The [removed: home delivery] pharmacy operations [removed: of our Health Services segment] consist of [removed: eight] [added: ten] order processing pharmacies, [removed: eight] [added: five] patient contact [removed: centers] [added: centers, 26 specialty branch pharmacies] and [removed: four] [added: 11] high-volume automated home delivery [added: and specialty] dispensing pharmacies located throughout the United States.

[removed: Health Services’ home delivery dispensing] [added: Dispensing] pharmacies are located in Arizona, [added: Delaware, Florida,] Indiana, [removed: Missouri and] [added: Massachusetts, Missouri,] New [removed: Jersey.][added: Jersey, Pennsylvania and Tennessee.]

Health Services also has seven specialty home delivery pharmacies and 38 specialty branch pharmacies.

[removed: Principal] [added: The principal] occupations and employment histories [added: of our executive officers] are listed below.

CORDANI, [removed: 54,] [added: 55,] Chief Executive Officer of Cigna beginning December 2009; Director since October 2009; President beginning June 2008; and Chief Operating Officer from June 2008 until December 2009.

EVANKO, [removed: 43,] [added: 44, Executive Vice President and Chief Financial Officer beginning January 2021;] President, Government Business [removed: beginning] [added: from] November [removed: 2017;] [added: 2017 to January 2021;] President, U.S. Individual Business from August 2013 to November 2017; Business Financial Officer, Cigna Global Individual, Health, Life and Accident from [removed: September 2012 to] August [removed: 2013; Chief Actuary, Cigna Global Individual, Health, Life and Accident from December 2008] [added: 2011] to [removed: September 2012.][added: August 2013.]

JONES, [removed: 49,] [added: 50,] Executive Vice President and General Counsel of Cigna beginning June 2011; Senior Vice President and General Counsel of Lincoln Financial Group from May 2010 until June 2011; Vice President and Deputy General Counsel of Cigna from April 2008 until May 2010; and Corporate Secretary of Cigna from September 2006 until April 2010.

MANDERS, [removed: 58,] [added: 59,] President, [removed: Strategy] [added: Government] and Solutions beginning [added: January 2021; President, Strategy and Solutions from] November [removed: 2018;] [added: 2018 until January 2021;] President, Government & Individual Programs and Group Insurance from February 2017 through November 2017; President, U.S. Markets from June 2014 until February 2017; President, Regional and Operations from November 2011 until June 2014; President, U.S. Service, Clinical and Specialty from January 2010 until November 2011; and President, Cigna HealthCare, Total Health, Productivity, Network & Middle Market from June 2009 until January 2010.

MILLER, MD, [removed: 62,] [added: 63,] Executive Vice President and Chief Clinical Officer beginning December 2018; Senior Vice President and Chief Medical Officer, of Express Scripts from October 2007 through December 2018.

MURABITO, [removed: 61,] [added: 62,] Executive Vice President, Human Resources and Services of Cigna beginning August 2003.

PALMER, [removed: 43,] [added: 44, President and Chief Operating Officer, Evernorth beginning January 2021;] Executive Vice President and Chief Financial Officer [removed: beginning] [added: from] June [removed: 2017;] [added: 2017 to January 2021;] Deputy Chief Financial Officer from February 2017 until June 2017; Senior Vice President, Chief Business Financial Officer from November 2015 to February 2017; Vice President, Business Financial Officer, Health Care from April 2012 to November 2015; and Vice President, Business Financial Officer, U.S. Commercial Markets from June 2010 to April 2012.

SADLER, [removed: 51,] [added: 52,] President, International Markets beginning June 2014; President, Global Individual Health, Life and Accident from July 2010 until June 2014; and Managing Director Insurance Business Hong Kong, HSBC Insurance Asia Limited from January 2007 until July 2010.

TRIPLETT, [removed: 58,] [added: 59,] President, U.S. [removed: Markets] [added: Commercial] beginning February 2017; Regional Segment Lead from June 2009 to February 2017.

WENTWORTH, [removed: 59,] [added: 60, Chief Executive Officer, Evernorth beginning September 2020;] President, Health Services [removed: beginning] [added: from] February [added: 2020 until September] 2020; President, Express Scripts and Cigna Services from December 2018 until February 2020; Chief Executive Officer of Express Scripts from May 2016 until December 2018; President from February 2014 through December 2018; and Senior Vice President and President, Sales and Account Management from April 2012 until February 2014.

NOELLE K.

EDER, 51, Executive Vice President, Chief Information Officer beginning September 2020; Executive Vice President, Chief Information and Digital Officer at Hilton Worldwide Holdings from March 2018 until August 2020; Executive Vice President, Chief Card Customer Experience Officer at Capital One Financial Corporation from November 2016 until 2018; and Executive Vice President, Customer Experience and Operations at Capital One Financial Corporation from September 2014 until November 2016.

KRISTEN LAURIA, 52, Executive Vice President, Chief Marketing Officer beginning March 2020; General Manager, Watson Media and Weather at IBM from February 2017 until March 2020; Vice President, Strategy and Business Development, IBM Analytics Group at IBM from April 2016 until February 2017; and Chief Marketing Officer, IBM Global Business Services at IBM from August 2014 to August 2016.

EVERETT NEVILLE, 56, Executive Vice President, Strategy and Business Development beginning January 2021; Senior Vice President, Value Creation and Solutions from January 2020 until January 2021; Chief Value Officer from December 2018 until January 2020; Executive Vice President, Strategy, Supply Chain & Specialty, Express Scripts from January 2018 until December 2018; Senior Vice President, Strategy, Supply Chain & Specialty from November 2016 until January 2018; Senior Vice President, Supply Chain from March 2015 until November 2016; Vice President, Pharma Strategy and Contracting from March 2009 until March 2015.

All officers are elected to serve for a one-year term or until their successors are elected.

MARK L.

BOXER, 60, Executive Vice President and Chief Information Officer of Cigna beginning April 2011; Deputy Chief Information Officer, Xerox Corporation; and Group President, Government Health Care, for Xerox Corporation/Affiliated Computer Services from March 2009 until April 2011.

As of December 31, [removed: 2019,] [added: 2020,] the number of shareholders of record was [removed: 35,727.][added: 33,418.]

The following table provides information about Cigna’s share repurchase activity for the quarter ended December 31, [removed: 2019:][added: 2020:]

| [added: Period] | | [added: | | | |] Total # of shares purchased (1) | [added: | | | | |] Average price paid per share | | [added: | | | |] Total # of shares purchased as part of publicly announced program (2) | [added: | | | | |] Approximate dollar value of shares that may yet be purchased as part of publicly announced program (3) | | [added: |]

[removed: *(1) Represents] [added: *(1)Includes] shares tendered by employees under the Company’s equity compensation plans as follows: 1) payment of taxes on vesting of restricted stock (grants and units) and strategic performance shares and 2) payment of the exercise price and taxes for certain stock options exercised.

Employees tendered [removed: 1,169] [added: 1,371] shares in October, [removed: 2,444] [added: 1,189] shares in November and [removed: 5,978] [added: 18,748] shares in December [removed: 2019.*][added: 2020.*]

[removed: *(2) Additionally,] [added: *(2)Additionally,] the Company maintains a share repurchase [removed: program,] [added: program] authorized by the Board of Directors.

The share repurchase program may be effected through Rule 10b5-1 plans, open market [removed: purchases or privately negotiated transactions,] [added: purchases,] each in compliance with Rule 10b-18 under the Exchange [removed: Act.][added: Act, or privately negotiated transactions.]

The program may be suspended or discontinued at any [removed: time.][added: time and does not have an expiration date.]

In [removed: the fourth quarter of 2019,] [added: December 2020,] the Board increased repurchase authority by an additional [removed: $4.0] [added: $2] billion.

From January 1, [removed: 2020] [added: 2021] through February [removed: 26, 2020,] [added: 24, 2021,] the Company repurchased [removed: 2.0] [added: 8.1] million shares for approximately [removed: $425 million,] [added: $1.7 billion,] leaving repurchase authority at [removed: $3.5] [added: $2.1] billion as of February [removed: 26, 2020.*][added: 24, 2021.*]

[removed: *(3) Approximate] [added: *(3)Approximate] dollar value of shares is as of the last date of the applicable month.*

The graph below compares the cumulative total shareholder return on our common stock for the five years ended December 31, [removed: 2019] [added: 2020] with the cumulative total return of the Standard & Poor’s 500 Index, the Standard & Poor’s 500 Health Care Providers & Services Index and the Standard & Poor’s Managed Health Care, Life & Health Insurance Indexes.

[removed: **][added: ]

On January 6, 2021 Cigna initiated a quarterly cash dividend and declared the first quarterly cash dividend of $1.00 per share of Cigna common stock to be paid on March 25, 2021 to shareholders of record as of March 10, 2021.

Cigna currently intends to pay regular quarterly dividends, with future declarations subject to approval by its Board of Directors and the Board's determination that the declaration of dividends remains in the best interests of Cigna and its shareholders.

The decision of whether to pay future dividends and the amount of any such dividends will be based on the Company's financial position, results of operations, cash flows, capital requirements, the requirements of applicable law and any other factors the Board of Directors may deem relevant.

For the years ended December 31, 2020 and 2019 Cigna paid a yearly cash dividend of $0.04 per share of Cigna common stock.

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| October 1-31, 2020 | | | | | | 2,513,269 | | | | | | $ | 174.20 | | | | | 2,511,898 | | | | | | $ | 3,154,849,988 | |

| November 1-30, 2020 | | | | | | 2,264,316 | | | | | | $ | 208.21 | | | | | 2,263,127 | | | | | | $ | 2,683,607,700 | |

| December 1-31, 2020 | | | | | | 3,933,971 | | | | | | $ | 206.97 | | | | | 3,915,223 | | | | | | $ | 3,873,160,092 | |

| Total | | | | | | 8,711,556 | | | | | | $ | 197.84 | | | | | 8,690,248 | | | | | | N/A | | |

With consideration to Cigna's evolved strategy and recent divestiture of the Group Disability and Life business, for future filings we will select to present the S&P 500 Health Care Index as our peer group for this disclosure.

Peer indices disclosed in previous filings are included herein for comparison.

The information under the caption “Quarterly Financial Data – Stock and Dividend Data” appears on page 147 of this Form 10-K.

| --- | --- | --- | --- | --- | --- | --- | --- |

| Period | | | | | | | |

| October 1-31, 2019 | | 1,542,086 | $ | 157.84 | 1,540,917 | $ | 1,159,327,593 |

| November 1-30, 2019 | | 522,214 | $ | 192.32 | 519,770 | $ | 1,059,361,992 |

| December 1-31, 2019 | | 488,296 | $ | 202.16 | 482,318 | $ | 3,961,834,531 |

| Total | | 2,552,596 | $ | 173.37 | 2,543,005 | | N/A |

The program does not have an expiration date.

The selected financial data previously required by Item 301 of Regulation S-K has been omitted in reliance on SEC Release No. 33-10890, Management’s Discussion and Analysis, Selected Financial Data and Supplementary Financial Information.

The selected financial data should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Consolidated Financial Statements and accompanying notes included elsewhere herein.

| Highlights | | | | | | | | | | |

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| | | | | | | | | | | |

| *(Dollars in millions, except per share amounts)* | | 2019 | | 2018 | | 2017 | | 2016 | | 2015 |

| Total revenues | $ | 153,566 | $ | 48,650 | $ | 41,806 | $ | 39,838 | $ | 38,098 |

| Shareholders' net income | $ | 5,104 | $ | 2,637 | $ | 2,237 | $ | 1,867 | $ | 2,094 |

| Net income | $ | 5,120 | $ | 2,646 | $ | 2,232 | $ | 1,843 | $ | 2,077 |

| Shareholders’ net income per share | | | | | | | | | | |

| Basic | $ | 13.58 | $ | 10.69 | $ | 8.92 | $ | 7.31 | $ | 8.17 |

| Diluted | $ | 13.44 | $ | 10.54 | $ | 8.77 | $ | 7.19 | $ | 8.04 |

| Common dividends declared per share | $ | 0.04 | $ | 0.04 | $ | 0.04 | $ | 0.04 | $ | 0.04 |

| Cash and investments | $ | 27,098 | $ | 32,829 | $ | 31,591 | $ | 30,000 | $ | 26,681 |

| Total assets | $ | 155,774 | $ | 153,226 | $ | 61,759 | $ | 59,366 | $ | 57,094 |

| Long-term debt | $ | 31,893 | $ | 39,523 | $ | 5,199 | $ | 4,756 | $ | 5,020 |

| Total liabilities | $ | 110,395 | $ | 112,154 | $ | 47,999 | $ | 45,605 | $ | 45,005 |

| Shareholders’ equity | $ | 45,338 | $ | 41,028 | $ | 13,711 | $ | 13,699 | $ | 12,011 |

We have audited the accompanying consolidated balance sheets of Cigna Corporation and its subsidiaries (the “Company”) as of December 31, [removed: 2019] [added: 2020] and [removed: 2018,] [added: 2019,] and the related consolidated statements of income, comprehensive income, changes in total equity and cash flows for each of the three years in the period ended December 31, [removed: 2019,] [added: 2020,] including the related notes (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of December 31, [removed: 2019,] [added: 2020,] based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2019] [added: 2020] and [removed: 2018,] [added: 2019,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2019] [added: 2020] in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2019,] [added: 2020,] based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the COSO.

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial [removed: reporting,] [added: reporting] and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 9A.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness [removed: exists,] [added: exists] and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

The critical audit [removed: matters] [added: matter] communicated below [removed: are matters] [added: is a matter] arising from the current period audit of the consolidated financial statements that [removed: were] [added: was] communicated or required to be communicated to the audit committee and that (i) [removed: relate] [added: relates] to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit [removed: matters] [added: matter] below, providing [added: a] separate [removed: opinions] [added: opinion] on the critical audit [removed: matters] [added: matter] or on the accounts or disclosures to which [removed: they relate.][added: it relates.]

As described in Note [removed: 18] [added: 17] to the consolidated financial statements, as of December 31, [removed: 2019,] [added: 2020,] goodwill is primarily reported in the [removed: Health Services] [added: Evernorth] segment [removed: ($33.7] [added: ($33.8] billion), the [removed: Integrated] [added: U.S.] Medical segment [removed: ($10.5] [added: ($10.4] billion) and, to a lesser extent, the International Markets segment ($0.4 billion).

Management [removed: evaluates goodwill] [added: conducts its annual quantitative evaluation] for [added: goodwill] impairment [removed: at least annually] during the third quarter at the reporting unit level and writes [removed: the goodwill balance] [added: it] down through shareholders’ net income if impaired.

The principal considerations for our determination that performing procedures relating to the goodwill impairment assessment [added: of the Evernorth and U.S. Medical reporting units] is a critical audit matter are [removed: there was] [added: the] significant judgment by management when determining the fair value measurement of the reporting units.

This in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s estimate of the reporting units’ fair value [removed: including] [added: related to] the assumptions for the discount rate and projection of future cash flows.

These procedures included testing the effectiveness of controls relating to management’s goodwill impairment assessment, including controls over management’s methodology, inputs and assumptions used in its goodwill impairment [removed: assessment.][added: assessment of the Evernorth and U.S. Medical reporting units.]

These procedures also included, among others, testing management’s process for determining the fair value estimate of the reporting units; evaluating the appropriateness of the discounted cash flow analysis; testing the completeness and accuracy of underlying data used in the discounted cash flow analysis; and evaluating the key inputs and significant [removed: assumptions, including] [added: assumptions related to] the discount rate and the projections of future cash flows.

The underlying inputs and assumptions used in the development of the discount rate and the projections of future cash flows that were evaluated [removed: included] [added: related to] the weighted average cost of capital, revenues, pharmacy costs, benefits expenses, operating expenses, capital levels and long-term growth rates.

Professionals with specialized skill and knowledge were used to assist in the evaluation of certain significant [removed: assumptions, including] [added: assumptions related to] the discount rate.

[removed: As described in Note 9 to] [added: For] the [removed: consolidated financial statements,] [added: year ended December 31, 2019, liabilities for unpaid claims and claim expenses within] the [added: Group Disability and Life business reflect the following primary products: long-term and short-term disability, life insurance and accident coverages and the] majority of the [removed: Company's] [added: Company’s] liability for disability claims [removed: consists] [added: consisted] of “disabled life reserves”, measured as the present value of estimated future benefit payments, including expected development, for each reported claim that is currently receiving benefit payments over the expected disability period or pending a decision on eligibility for benefits.

[removed: Management projects] [added: The Company projected] the expected disability period by using historical resolution rates combined with an analysis of current trends and operational factors to develop current estimates of resolution rates.

[removed: estimates] [added: The Company estimated] the probability and amount of future offset awards and lapses based on [removed: management’s] [added: the Company’s] experience for certain offsets not yet finalized.

| Cigna Corporation | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: Cigna Corporation] Consolidated Statements of Income | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | |]

| | [added: | | | | | | | |] For the [removed: years ended] [added: Years Ended] December 31, | | | | | | [added: | | | | | | | | | | | | | | |]

| *(In millions, except per share amounts)* | [added: | | | | | | | | | | | | | | 2020 | | | | | |] 2019 | | [removed: 2018] | | [removed: 2017] | | [added: 2018 | | |]

| Revenues | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | |]

| Pharmacy revenues | [added: | | | | | | | | | | | | | |] $ | [removed: 103,099] [added: 107,769] | [added: | | | |] $ | [removed: 5,479] [added: 103,099] | [added: | | | |] $ | [removed: 2,979] [added: 5,479] | [added: |]

| Premiums | | [removed: 39,714] | | [added: | | | | | | | | | | | 42,627 | | | | | | 39,714 | | | | | |] 36,113 | | [removed: 32,491] |

| Fees and other revenues | | [removed: 9,363] | | [added: | | | | | | | | | | | 8,761 | | | | | | 9,363 | | | | | |] 5,578 | | [removed: 5,110] |

| Net investment income | | [removed: 1,390] | | [added: | | | | | | | | | | | 1,244 | | | | | | 1,390 | | | | | |] 1,480 | | [removed: 1,226] |

| TOTAL REVENUES | | [removed: 153,566] | | [added: | | | | | | | | | | | 160,401 | | | | | | 153,566 | | | | | |] 48,650 | | [removed: 41,806] |

| Benefits and expenses | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | |]

| Pharmacy and other service costs | | [removed: 97,668] | | [added: | | | | | | | | | | | 103,484 | | | | | | 97,668 | | | | | |] 4,793 | | [removed: 2,456] |

| Medical costs and other benefit expenses | | [removed: 30,819] | | [added: | | | | | | | | | | | 32,710 | | | | | | 30,819 | | | | | |] 27,528 | | [removed: 25,263] |

| Selling, general and administrative expenses | | [removed: 14,053] | | [added: | | | | | | | | | | | 14,072 | | | | | | 14,053 | | | | | |] 11,934 | | [removed: 10,030] |

| Amortization of acquired intangible assets | | [removed: 2,949] | | [added: | | | | | | | | | | | 1,982 | | | | | | 2,949 | | | | | |] 235 | | [removed: 115] |

| TOTAL BENEFITS AND EXPENSES | | [removed: 145,489] | | [added: | | | | | | | | | | | 152,248 | | | | | | 145,489 | | | | | |] 44,490 | | [removed: 37,864] |

| Income from operations | | [removed: 8,077] | | [added: | | | | | | | | | | | 8,153 | | | | | | 8,077 | | | | | |] 4,160 | | [removed: 3,942] |

| Interest expense and other | | [removed: (1,682)] | | [added: | | | | | | | | | | | (1,438) | | | | | | (1,682) | | | | | |] (498) | | [removed: (252)] |

| Debt extinguishment costs | | [removed: (2)] | | [removed: \-] | | [removed: (321)] | [added: | | | | | | | | (199) | | | | | | (2) | | | | | | — | | |]

| Net realized investment gains (losses) | | [removed: 177] | | [added: | | | | | | | | | | | 149 | | | | | | 177 | | | | | |] (81) | | [removed: 237] |

| Income before income taxes | | [removed: 6,570] | | [added: | | | | | | | | | | | 10,868 | | | | | | 6,570 | | | | | |] 3,581 | | [removed: 3,606] |

*Goodwill Impairment Assessment - Evernorth and U.S. Medical Reporting Units*

On a quarterly basis, management performs a qualitative impairment assessment to determine if events or changes in circumstances indicate that it is more likely than not that the carrying value of a reporting unit exceeds its estimated fair value.

February 25, 2021

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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Gain (loss) on sale of business | | | | | | | | | | | | | | | 4,203 | | | | | | — | | | | | | — | | |

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| *(In millions)* | | | | | | 2020 | | | | | | 2019 | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Cumulative effect of adopting new credit loss guidance (ASU 2016-13) (1) | | | | | | | | | | | | | | | | | | | | | | | | (30) | | | | | | | | | | | | (30) | | | | | | | | | | | | (30) | | | | | | | | |

| Net income | | | | | | | | | | | | | | | | | | | | | | | | 8,458 | | | | | | | | | | | | 8,458 | | | | | | 17 | | | | | | 8,475 | | | | | | 14 | | |

| Balance at December 31, 2020 | | | | | | $ | 4 | | | | | $ | 28,975 | | | | | $ | (861) | | | | | $ | 28,575 | | | | | $ | (6,372) | | | | | $ | 50,321 | | | | | $ | 7 | | | | | $ | 50,328 | | | | | $ | 58 | |

| | | | | | | For the Years Ended December 31, | | | | | | | | | | | | | | |

| Gain on sale of business | | | | | | (4,203) | | | | | | — | | | | | | — | | |

| Divestiture, net of cash sold | | | | | | 5,592 | | | | | | — | | | | | | — | | |

| Net proceeds on issuance of term loan | | | | | | 1,398 | | | | | | — | | | | | | — | | |

| Repayment of term loan | | | | | | (1,400) | | | | | | — | | | | | | — | | |

*(1)Includes $743 million reported in Assets of business held for sale as of January 1, 2020.

See table below for Cash, cash equivalents and restricted cash reconciliation.*

*(2)See table below for Cash, cash equivalents and restricted cash reconciliation as of December 31, 2020 and December 31, 2019.*

The following table provides a reconciliation of cash, cash equivalents and restricted cash and cash equivalents reported within the Consolidated Balance Sheets to the totals above:

| | | | | | | | | | | | |

| *(In millions)* | | | 2020 | | | | | | 2019 | | |

| Total cash, cash equivalents, and restricted cash and cash equivalents | | | $ | 10,245 | | | | | $ | 4,668 | |

*The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.*

| BUSINESS AND CAPITAL STRUCTURE | | | | | | | | |

| [2](#ic5b0f4c2cee8492e9ee4ea74564c54b2_40) | | | [COVID-19 and Related Economic Impact](#ic5b0f4c2cee8492e9ee4ea74564c54b2_40) | | | [87](#ic5b0f4c2cee8492e9ee4ea74564c54b2_40) | | |

| [5](#ic5b0f4c2cee8492e9ee4ea74564c54b2_58) | | | [Mergers](#ic5b0f4c2cee8492e9ee4ea74564c54b2_58)[,](#ic5b0f4c2cee8492e9ee4ea74564c54b2_58) [Acqui](#ic5b0f4c2cee8492e9ee4ea74564c54b2_58)[sition](#ic5b0f4c2cee8492e9ee4ea74564c54b2_58)[s](#ic5b0f4c2cee8492e9ee4ea74564c54b2_58) and Divestitures | | | [95](#ic5b0f4c2cee8492e9ee4ea74564c54b2_58) | | |

| [7](#ic5b0f4c2cee8492e9ee4ea74564c54b2_70) | | | [Debt](#ic5b0f4c2cee8492e9ee4ea74564c54b2_70) | | | [97](#ic5b0f4c2cee8492e9ee4ea74564c54b2_70) | | |

| INSURANCE INFORMATION | | | | | | | | |

| [10](#ic5b0f4c2cee8492e9ee4ea74564c54b2_76) | | | [Reinsurance](#ic5b0f4c2cee8492e9ee4ea74564c54b2_76) | | | [104](#ic5b0f4c2cee8492e9ee4ea74564c54b2_76) | | |

| INVESTMENTS | | | | | | | | |

| [11](#ic5b0f4c2cee8492e9ee4ea74564c54b2_82) | | | [Investments](#ic5b0f4c2cee8492e9ee4ea74564c54b2_82) | | | [108](#ic5b0f4c2cee8492e9ee4ea74564c54b2_82) | | |

*Goodwill Impairment Assessment*

In addition, the audit effort involved the use of professionals with specialized skill and knowledge to assist in performing these procedures and evaluating the audit evidence obtained.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

*Valuation of Long-term Disability Disabled Life Reserves*

As of December 31, 2019, the long-term disability disabled life reserves were $3.5 billion.

Expected claim resolution rates may vary based upon management’s experience for the anticipated disability period, the covered benefit period, the cause of disability, the benefit design and the claimant’s age, gender and income level.

The gross monthly benefit is reduced (offset) by disability income received under other benefit programs, most commonly Social Security Disability Income, workers' compensation, statutory disability or other group benefit plans.

Management

The principal considerations for our determination that performing procedures relating to the valuation of long-term disability disabled life reserves is a critical audit matter are there was significant judgment by management when determining the reserves.

This in turn led to a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating audit evidence relating to the actuarial methodologies and assumptions including the discount rate, resolution rates, offset awards, and adequacy utilized to estimate the reserves.

These procedures included testing the effectiveness of controls relating to the valuation of long-term disability disabled life reserves, including controls over management’s actuarial methodologies and the development of significant assumptions including the discount rate, resolution rates, offset awards, and adequacy.

These procedures also included, among others, the involvement of professionals with specialized skill and knowledge to assist in testing management’s process for determining the reserves which included evaluating the appropriateness of management’s actuarial methodologies and the reasonableness of the aforementioned assumptions utilized in determining the reserves balances and recalculating the reserves for a sample of long-term disability disabled life reserves utilizing management’s actuarial methodologies and assumptions.

The professionals with specialized skill and knowledge also recalculated a sample of long-term disability disabled life reserves utilizing an independent model and management’s assumptions.

Performing these procedures involved testing the completeness and accuracy of the data provided by management.

February 27, 2020

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| Cigna Corporation | | | | | | | | | | | | | | | | | | | |

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| | | | | | | | | | | | | | | | | | | | |

| Balance at December 31, 2016 | $ | 74 | $ | 2,892 | $ | (1,382) | $ | 13,831 | $ | (1,716) | $ | 13,699 | $ | 4 | $ | 13,703 | $ | 58 | |

| 2017 Activity | | | | | | | | | | | | | | | | | | | |

| Net income (loss) | | | | | | | | 2,237 | | | | 2,237 | | (5) | | 2,232 | | \- | |

| 2019 Activity | | | | | | | | | | | | | | | | | | | |

| | | | | | | |

| | | |

| --- | --- | --- |

| Business and Capital Structure | | |

| [7](#TOC3_Debt2) | [Debt](#TOC3_Debt2) | [99](#TOC3_Debt2) |

| Insurance Information | | |

| [10](#TOC3_Reinsurance) | [Reinsurance](#TOC3_Reinsurance) | [107](#TOC3_Reinsurance) |

| Workforce Management and Compensation | | |

| [16](#TOC3_Pension) | [Pension](#TOC3_Pension) | [126](#TOC3_Pension) |

| Property, Leases and Other Asset Balances | | |

| [19](#TOC3_Leases) | [Leases](#TOC3_Leases) | [135](#TOC3_Leases) |

| Compliance, Regulation and Contingencies | | |

| Results Details | | |

| | [Quarterly Financial Data](#TOC3_Quarterly_Financial_Data) | [147](#TOC3_Quarterly_Financial_Data) |

Based on an evaluation of the effectiveness of Cigna’s disclosure controls and procedures conducted under the supervision and with the participation of [removed: Cigna's] [added: Cigna’s] management (including Cigna’s Chief Executive Officer and Chief Financial Officer), [removed: Cigna’s] [added: Cigna's] Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this report, Cigna’s disclosure controls and procedures are effective to ensure that information required to be disclosed by Cigna in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the [removed: SEC’s] [added: Securities and Exchange Commission’s] rules and forms and is accumulated and communicated to Cigna’s management, including [removed: its principal executive] [added: Cigna’s Chief Executive Officer] and [removed: principal financial officers,] [added: Chief Financial Officer,] as appropriate to allow timely decisions regarding required disclosure.

Management assessed the effectiveness of the Company’s internal controls over financial reporting as of December 31, [removed: 2019.][added: 2020.]

In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in *Internal Control-Integrated Framework (2013).* Based on management’s assessment and the criteria set forth by COSO, it was determined that the Company’s internal controls over financial reporting are effective as of December 31, [removed: 2019.][added: 2020.]

[removed: During the period covered by this report, other than the changes resulting from the Express Scripts, Inc. acquisition discussed below, there] [added: There] have been no changes in [removed: Cigna's] [added: our] internal control over financial reporting [added: during the quarter ended December 31, 2020] that have materially affected, or are reasonably likely to materially affect, Cigna's internal control over financial reporting.

On December 20, 2018, the Company completed the acquisition of Express Scripts, Inc. During 2019, the Company has incorporated internal controls over significant processes specific to Express Scripts that it believes to be appropriate and necessary in consideration of the level of related integration.

As the Company further integrates the Express Scripts business, it will continue to review the internal controls and may take further steps to ensure that the internal controls are effective and integrated appropriately.

[removed: A.Directors] [added: A.Directors] of the Registrant

The information under the captions “Corporate Governance Matters – [removed: Process for Director Elections,” “–] Board of Directors’ Nominees” and “– Board Meetings and Committees” (as it relates to Audit Committee disclosure) in Cigna’s definitive proxy statement related to the [removed: 2020] [added: 2021] annual meeting of shareholders is incorporated herein by reference.

See PART I – “Information about our Executive Officers” [removed: on page 47] in this Form 10-K.

The information under the caption “Corporate Governance Matters – Codes of Ethics” in Cigna’s definitive proxy statement related to the [removed: 2020] [added: 2021] annual meeting of shareholders is incorporated herein by reference.

The information under the caption “Ownership of Cigna Common Stock – Delinquent Section 16(a) Reports”, if included in Cigna’s definitive proxy statement related to the [removed: 2020] [added: 2021] annual meeting of shareholders, is incorporated herein by reference.

The information under the captions “Corporate Governance Matters – Non-Employee Director Compensation,” [removed: “Corporate Governance Matters – Certain] [added: “Certain] Transactions – Compensation Committee Interlocks and Inside Participation,” “Compensation Matters – Compensation Discussion and Analysis,” “– Report of the People Resources Committee” and “– Executive Compensation Tables” in Cigna’s definitive proxy statement related to the [removed: 2020] [added: 2021] annual meeting of shareholders is incorporated herein by reference.

The following table presents information regarding Cigna’s equity compensation plans as of December 31, [removed: 2019:][added: 2020:]

| Plan Category | | | | [added: | |] Securities To Be Issued Upon Exercise Of Outstanding Options, Warrants And Rights | | | [added: | | |] Weighted Average Exercise Price Of Outstanding Options, Warrants And Rights | | | [added: | | |] Securities Remaining Available For Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected In Column (a)) | | |

| Equity Compensation Plans [added: Not] Approved by Security Holders | | | | | [removed: 13,709,684] | [added: —] | [removed: $] | [removed: 136.19] | | | [removed: 26,267,656] | [added: —] | [added: | | | | | — | | |]

| Equity Compensation Plans [removed: Not] Approved by Security Holders | | | | | [removed: \-] | [added: 11,725,097] | | [removed: \-] | | | [removed: \-] | [added: $] | [added: 152.40 | | | | | 23,618,311 | | |]

*(i) [removed: 96,298] [added: 82,426] restricted stock units, [removed: 115,723] [added: 122,887] deferred [removed: shares,] [added: shares] and [removed: 1,558,258] [added: 1,615,392] strategic performance shares that are reported at the maximum 200% payout rate granted under the Cigna Long-Term Incentive Plan, the Corporation Stock Plan and the Cigna Corporation Director Equity Plan; and*

*(ii) [removed: 789,459] [added: 637,546] shares of common stock underlying stock option awards and [removed: 488,127] [added: 153,959] restricted stock units granted under the Express Scripts Holding Company 2016 Long-Term Incentive Plan, [removed: 10,001] [added: 5,728] deferred shares granted under the Express Scripts, Inc. Executive Deferred Compensation Plan of 2005, [removed: 2,077,398] [added: 1,327,353] shares of common stock underlying stock option awards granted under the Express Scripts, Inc. 2011 Long-Term Incentive Plan, [removed: 1,759,907] [added: 1,091,220] shares of common stock underlying stock option awards and 3,300 restricted stock units granted under the Medco Health Solutions, Inc. 2002 Stock Incentive Plan, and [removed: 90,088] [added: 43,737] shares of common stock underlying stock option awards granted under the Accredo Health, Incorporated 2002 Long-Term Incentive Plan that were all approved by the applicable company’s shareholders before Cigna’s acquisition of Express Scripts in December 2018.*

The outstanding stock options assumed due to Cigna's acquisition of Express Scripts, in aggregate, have a weighted-average exercise price of [removed: $139.76.][added: $143.21.]

Excluding the assumed options from this acquisition results in a weighted-average exercise price of [removed: $133.69.*][added: $156.69.*]

[removed: *(3)* *Includes 225,338] [added: *(3)Includes 213,471] shares of common stock available as of the close of business December 31, [removed: 2019] [added: 2020] for future issuance under the Cigna Corporation Director Equity Plan, [removed: 23,231,054] [added: 20,591,667] shares of common stock available as of the close of business on December 31, [removed: 2019] [added: 2020] for future issuance under the Cigna Long-Term Incentive Plan that includes [removed: 11,825,476] [added: 10,728,281] shares of common stock available assumed from the Express Scripts, Inc. 2016 Long-Term Incentive Plan, and [removed: 2,811,264] [added: 2,813,173] shares of common stock available as of the close of business December 31, [removed: 2019] [added: 2020] for future issuance under the Express Scripts, Inc. Executive Deferred Compensation Plan of 2005.

Because no further grants may be made under the Express Scripts, Inc. [removed: 2016 Long-Term Incentive Plan, the Express Scripts, Inc.] 2011 Long-Term Incentive Plan, the Medco Health Solutions, Inc. 2002 Stock Incentive [removed: Plan,] [added: Plan] and the Accredo Health, Incorporated 2002 Long-Term Incentive Plan, shares available for issuance under these plans are not included.*

The information under the captions “Ownership of Cigna Common Stock – Stock Held by Directors, Nominees and Executive Officers” and “Ownership of Cigna Common Stock – Stock Held by Certain Beneficial Owners” in Cigna’s definitive proxy statement related to the [removed: 2020] [added: 2021] annual meeting of shareholders is incorporated herein by reference.

| | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | (a)(1) | | | | | | (b)(2) | | | | | | (c)(3) | | |

| Total | | | | | | 11,725,097 | | | | | | $ | 152.40 | | | | | 23,618,311 | | |

| | | | | (a)(1) | | | (b)(2) | | | (c)(3) | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Total | | | | | 13,709,684 | | $ | 136.19 | | | 26,267,656 | |

The information under the captions “Corporate Governance Matters – Director Independence” and “– Certain Transactions” in Cigna’s definitive proxy statement related to the [removed: 2020] [added: 2021] annual meeting of shareholders is incorporated herein by reference.

The information under the captions “Audit Matters – Policy for the Pre-Approval of Audit and Non-Audit Services” and “– Fees to Independent Registered Public Accounting Firm” in Cigna’s definitive proxy statement related to the [removed: 2020] [added: 2021] annual meeting of shareholders is incorporated herein by reference.

Consolidated Statements of Income for the years ended December 31, [removed: 2019, 2018] [added: 2020, 2019] and [removed: 2017.][added: 2018.]

Consolidated Statements of Comprehensive Income for the years ended December 31, [removed: 2019, 2018] [added: 2020, 2019] and [removed: 2017.][added: 2018.]

Consolidated Balance Sheets as of December 31, [removed: 2019] [added: 2020] and [removed: 2018.][added: 2019.]

Consolidated Statements of Changes in Total Equity for the years ended December 31, [removed: 2019, 2018] [added: 2020, 2019] and [removed: 2017.][added: 2018.]

Consolidated Statements of Cash Flows for the years ended December 31, [removed: 2019, 2018] [added: 2020, 2019] and [removed: 2017.][added: 2018.]

[removed: (2) The] [added: (2)The] financial statement schedules [removed: are] listed in the Index to Financial Statement Schedules on page [removed: FS-1.][added: FS-1 which list is incorporated herein.]

[removed: (b) The] [added: (b)The] exhibits listed in the accompanying “Index to Exhibits” in this Item 15 are filed or incorporated by reference as part of this Annual Report on Form 10-K.

| Number | [added: | |] Description | [added: | |] Method of Filing | [added: | |]

| 2.1(a) | [added: | |] [Agreement and Plan of Merger, dated as of March 8, 2018, by and among Cigna Corporation (formerly Halfmoon Parent, Inc.), Express Scripts Holding Company, Cigna Holding Company (formerly Cigna Corporation), Halfmoon I, [removed: Inc., and] [added: Inc.](http://www.sec.gov/Archives/edgar/data/701221/000095015918000095/ex2-1.htm) [and] Halfmoon II, Inc.](http://www.sec.gov/Archives/edgar/data/701221/000095015918000095/ex2-1.htm) | [added: | |] Filed by Cigna Holding Company (“CHC”) as Exhibit 2.1 to the Current Report on Form 8-K on March 13, 2018 and incorporated herein by reference. | [added: | |]

| 2.1(b) | [added: | |] [Amendment No. 1, dated as of June 27, 2018, to the Agreement and Plan of Merger, dated as of March 8, 2018, by and among Cigna Corporation, Express Scripts Holding Company, Cigna Holding Company, Halfmoon I, Inc. and Halfmoon II, Inc.](http://www.sec.gov/Archives/edgar/data/701221/000095015918000282/ex2-1.htm) | [added: | |] Filed by CHC as Exhibit 2.1 to the Current Report on Form 8-K on July 2, 2018 and incorporated herein by reference. | [added: | |]

| 3.1 | [added: | |] [Amended and Restated Certificate of Incorporation of the registrant as last amended December 20, 2018](http://www.sec.gov/Archives/edgar/data/1739940/000114036118045479/ex3_1.htm) | [added: | |] Filed by the registrant as Exhibit 3.1 to the Current Report on Form 8-K on December 20, 2018 and incorporated herein by reference. | [added: | |]

| 3.2 | [added: | |] [Amended and Restated By-Laws of the registrant as last amended February 26, [removed: 2020](http://www.sec.gov/Archives/edgar/data/1739940/000095015920000057/ex3-1.htm).] [added: 2020.](http://www.sec.gov/Archives/edgar/data/1739940/000095015920000057/ex3-1.htm)] | [added: | |] Filed by the registrant as Exhibit 3.1 to the Current Report on Form 8-K on February 27, 2020 and incorporated herein by reference. | [added: | |]

| 4.1(a) | [added: | |] [Indenture, dated as of September 17, 2018, between Cigna Corporation (formerly Halfmoon Parent, Inc.) and U.S. Bank National Association, as trustee](http://www.sec.gov/Archives/edgar/data/701221/000095015918000403/ex4-1.htm) | [added: | |] Filed by CHC as Exhibit 4.1 to the Current Report on Form 8-K on September 21, 2018 and incorporated herein by reference. | [added: | |]

| 4.1(b) | [added: | |] [Supplemental Indenture, dated as of September 17, 2018, between Cigna Corporation (formerly Halfmoon Parent, Inc.) and U.S. Bank National Association, as trustee](http://www.sec.gov/Archives/edgar/data/701221/000095015918000403/ex4-2.htm) | [added: | |] Filed by CHC as Exhibit 4.2 to the Current Report on Form 8-K on September 21, 2018 and incorporated herein by reference. | [added: | |]

| 4.1(c) | [added: | |] [Second Supplemental Indenture dated as of December 20, 2018, by and among Express Scripts Holding Company, Cigna Holding Company and U.S. Bank National Association, as Trustee](http://www.sec.gov/Archives/edgar/data/1739940/000114036118045479/ex4_7.htm) | [added: | |] Filed by the registrant as Exhibit 4.7 to the Current Report on Form 8-K on December 20, 2018 and incorporated herein by reference. | [added: | |]

| 4.1(d) | [added: | |] [Third Supplemental Indenture, dated as of October 11, 2019, by and among Cigna Corporation, as the Issuer, Cigna Holding Company and Express Scripts Holding Company, each as guarantors, and U.S. Bank, National Association, as trustee](http://www.sec.gov/Archives/edgar/data/1739940/000095015919000178/ex4-1.htm) | [added: | |] Filed by the registrant as Exhibit 4.1 to the Current Report on Form 8-K on October 11, 2019 and incorporated herein by reference. | [added: | |]

| 4.2 | [added: | |] [Registration Rights Agreement, dated as of October 11, 2019, by and among Cigna Corporation, as the Issuer, Cigna Holding Company and Express Scripts Holding Company, each as guarantors, and J.P. Morgan Securities LLC, Deutsche Bank Securities Inc., and Wells Fargo Securities, LLC, each as dealer managers](http://www.sec.gov/Archives/edgar/data/1739940/000095015919000178/ex4-2.htm) | [added: | |] Filed by the registrant as Exhibit 4.2 to the Current Report on Form 8-K on October 11, 2019 and incorporated herein by reference. | [added: | |]

| 4.3(a) | [added: | |] [Senior Indenture dated August 16, 2006 between Cigna Holding Company (formerly Cigna Corporation) and U.S. Bank National Association](http://www.sec.gov/Archives/edgar/data/701221/000104746913001925/a2213028zex-4_1a.htm) | [added: | |] Filed by CHC as Exhibit 4.1(a) to the Annual Report on Form 10-K for the year ended December 31, 2012 and incorporated herein by reference. | [added: | |]

| 4.3(b) | [added: | |] [Supplemental Indenture No. 1 dated November 10, 2006 between Cigna Holding Company and U.S. Bank National Association](http://www.sec.gov/Archives/edgar/data/701221/000104746913001925/a2213028zex-4_1b.htm) | [added: | |] Filed by CHC as Exhibit 4.1(b) to the Annual Report on Form 10-K for the year ended December 31, 2012 and incorporated herein by reference. | [added: | |]

| 4.3(c) | [added: | |] [Supplemental Indenture No. 2 dated March 15, 2007 between Cigna Holding Company and U.S. Bank National Association](http://www.sec.gov/Archives/edgar/data/701221/000130817911000059/ex41.htm) | [added: | |] Filed by CHC as Exhibit 4.1(c) to the Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2011 and incorporated herein by reference. | [added: | |]

| 4.3(d) | [added: | |] [Supplemental Indenture No. 3 dated March 7, 2008 between Cigna Holding Company and U.S. Bank National Association](http://www.sec.gov/Archives/edgar/data/701221/000095015908000451/ex4-1.htm) | [added: | |] Filed by CHC as Exhibit 4.1 to the Current Report on Form 8-K on March 10, 2008 and incorporated herein by reference. | [added: | |]

| 4.3(e) | [added: | |] [Supplemental Indenture No. 5 dated May 17, 2010 between Cigna Holding Company and U.S. Bank National Association](http://www.sec.gov/Archives/edgar/data/701221/000095015910000489/ex99-2.htm) | [added: | |] Filed by CHC as Exhibit 99.2 to the Current Report on Form 8-K on May 28, 2010 and incorporated herein by reference. | [added: | |]

| 4.3(f) | [added: | |] [Supplemental Indenture No. 6 dated December 8, 2010 between Cigna Holding Company and U.S. Bank National Association](http://www.sec.gov/Archives/edgar/data/701221/000095015910000997/ex99-2.htm) | [added: | |] Filed by CHC as Exhibit 99.2 to the Current Report on Form 8-K on December 9, 2010 and incorporated herein by reference. | [added: | |]

| 4.3(g) | [added: | |] [Supplemental Indenture No. 7 dated March 7, 2011 between Cigna Holding Company and U.S. Bank National Association](http://www.sec.gov/Archives/edgar/data/701221/000095015911000163/ex99-2.htm) | [added: | |] Filed by CHC as Exhibit 99.2 to the Current Report on Form 8-K on March 8, 2011 and incorporated herein by reference. | [added: | |]