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This audio is auto-generated. Please let us know if you have feedback<\/a>.<\/p>\n Dive Brief:<\/p>\n Cigna beat investor expectations on earnings and revenue in the second quarter<\/a> as the insurer reported strong growth in its Evernorth health services arm. Dive Insight:\u00a0<\/p>\n Many insurers<\/a> have struggled with heightened medical costs<\/a> in the second quarter, particularly those offering health plans on the Affordable Care Act exchanges<\/a> as well as in Medicare and Medicaid<\/a>.\u00a0<\/p>\n But Cigna is likely more insulated from these challenges, given the company\u2019s focus on employer-sponsored health plans. The insurer also closed the sale of its Medicare business<\/a> to Health Care Service Corporation this spring.\u00a0\u00a0<\/p>\n \u201cWe have intentionally positioned our Cigna Healthcare portfolio with a product mix that has proven favorable in the current environment, as we have no exposure to Medicaid or Medicare,\u201d Evanko said on the call Thursday morning.<\/p>\n Cigna\u2019s healthcare insurance unit reported $10.8 billion in adjusted revenue, down 18% year over year, largely due to divesting the Medicare business.\u00a0<\/p>\n Adjusted income from operations was $1.1 billion, decreasing 9% from the previous year linked to a higher medical loss ratio \u2014 a key marker of spending on patient care.<\/p>\n Cigna\u2019s MLR was $83.2% in the second quarter, up from $82.3% in 2024 as the company grappled with higher costs in stop-loss insurance.\u00a0<\/p>\n The health insurance unit also faced heightened utilization in individual plans as medical costs increased across the ACA marketplace, CFO Ann Dennison said.\u00a0<\/p>\n \u201cHowever, this pressure was manageable due to the smaller relative size of our ACA book, aided by our disciplined pricing actions over the past two years,\u201d she said.<\/p>\n On the Evernorth side of the business, adjusted income for pharmacy benefit services was up 2% to $833 million. Adjusted revenue for pharmacy benefit services was up 20%.<\/p>\n The positive results for Cigna\u2019s pharmacy benefit manager Express Scripts \u2014 one of the nation\u2019s largest PBMs \u2014 comes as the pharmacy middlemen have faced increased scrutiny from regulators<\/a> and lawmakers<\/a> for driving up drug costs.\u00a0<\/p>\n
\nThe company reported revenue of $57.8 billion for Evernorth in the second quarter, up 17% year over year. Adjusted income from operations in the unit was $1.7 billion, increasing 5% from last year, according to Cigna\u2019s second-quarter earnings released Thursday.\u00a0
\nMeanwhile, Cigna\u2019s health insurance segment is performing within expectations, even as the insurer has seen \u201cpersistently elevated medical costs throughout the year,\u201d COO Brian Evanko said during an earnings call Thursday.<\/p>\n