Q3 2024 The Cigna Group Earnings Call
Ladies and gentlemen, thank you for seeing me for the sign-up group's third quarter 2020 for Results Review. At this time, all colors are in a listen-only mode. We will conduct a question and answer session later during the conference and review procedures on how to enter the queue to ask questions at that time.
Speaker Change: If you should require assistance during the call, please press star zero on your touch tone phone. As a reminder, ladies and gentlemen, this conference, including the Q&A session, is being reported. We will begin by turning the conference over to Ralph Giacobbe. Please go ahead.
Speaker Change: Thanks, operator. Good morning everyone. Thank you for joining today's call. I'm Ralph Giacobbe, Senior Vice President of the Messer Relations.
Speaker Change: with me on the line this morning, our David Cordani, the Signagooops Chairman and Chief Executive Officer, Brian Evanko, Chief Financial Officer of the Signagooop and President and Chief Executive Officer of Signagooop Care, and Eric Palmer. President and Chief Executive Officer of Evernor Health Services.
Speaker Change: In our remarks today, David and Brian will cover a number of topics, including our third, quarter financial results, and our financial outlook for 2024. Following their prepared remarks, David Brian and Eric will be available for Q&A.
Speaker Change: As noted in our earnings release, when describing our financial results, we use certain financial measures, including adjusting income from operations and adjusted revenues, which are not determined in accordance with accounting principles generally accepted in the United States otherwise known as GAP.
Speaker Change: Reconciliation of these measures to the most directly comparable gap measures, shareholders net income and total revenues respectively is contained in today's earnings release, which is posted in the investor-relation section of thesignagrupt.com.
Speaker Change: We use the term labeled adjusted income from operations and adjusted earnings per share on the same basis as our principal measures of financial performance.
Speaker Change: In our remarks today, we will be making some forward-looking statements, including statements regarding our outlook for 2024 and future performance.
Speaker Change: These statements are subject to risks and uncertainties that could cause actual results to different materially from our current expectations.
Speaker Change: A description of these risks and uncertainties is contained in the cautionary note to today's earnings release and in our most recent reports filed with the SEC.
Speaker Change: Before turning the call over, I will cover a couple items pertaining to our GAP financial results.
Speaker Change: In the third quarter, we recorded shareholders net income of $739 million or $2.63 per share.
Speaker Change: This is driven by a non-cash after tax net-realized investment loss of $1 billion or $3.69 per share related to village MD.
Speaker Change: This includes both the right down of the remaining carrying value of the asset, as well as the impairment of the dividend, which is recognized as a special item in the quarter. This is excluded from adjusted income from operations and adjusted earnings per share in our discussion of financial results.
Speaker Change: In the third quarter we also recorded other after tax, net special item charges of $162 million or $58 per share. Details of the special items are included in our quarterly financial supplement.
Speaker Change: Additionally, please note that when we make perspective comments regarding financial performance, including our full year 2024 outlook, we'll do so on a basis that includes the potential impact of future share of purchases and anticipated 2024 dividends. With that, I'll turn to call over to David.
David: Thanks for all's, good morning everyone and thank you for joining today's call. Today I'll spend a few minutes talking about our strong results in the third quarter and how we're advancing our growth strategy.
David: I'll also provide some initial perspective related to 2025, including some of the expected tailwind that happens. Then Brian will share more detail about a result and I'll look for the rest of the year and we'll take your questions. So let's get started.
David: Building on a track record of competitively differentiated performance, I'm pleased to report that in the third quarter of the significant delivery total revenue of $63.7 billion.
David: and the dress that earnings per share of $7.51.
David: Our results are a testament to the collective depth and strength of our people and commitment, hard work and focus they bring to everything we do.
David: We have deep continuity and the most experienced leadership team in the industry with more than 16 years average tenure across our growth platforms.
David: And we could use the infuse new challenge of the companies across many sectors of industries to round out our enterprise perspective.
David: Arthur recorded performance demonstrates how we harness the complementary capabilities over two growth platforms.
David: Evermore Health Services, and Signal Healthcare to drive attractive growth.
David: This quarter of Abonaut anchored results by delivering strong top and bottling contributions generated by market leading innovation and affordability initiatives, particularly within our specialty in care services portfolio, as well as our pharmacy benefits service business.
David: Evernodes Strong, overall growth reflects the continued demand for our services as we can do investing in broadening our offerings and expanding our reach.
David: Technology Healthcare was also continuing their momentum in the quarter.
David: You have employer business draws on enterprise capabilities to deliver greater affordability and support help the outcomes for the benefit of our clients and their employees and families. Of note we are driving continued solid growth in our select customer segment.
David: Our results demonstrate hope of execution and momentum during our keep selling season and continue to opportunity for growth in the years ahead.
David: Touching on a Medicare Advantage business, we remain on track to close on our sale of our Medicare business to HESC in the first quarter of 2025.
David: We continue to expect you to be the majority of the proceeds for Sherry Curtis.
David: I would note that our Medicare business is performing in-line with expectations. And we're pleased that the overall value for offerings, including our nationwide enrollment weighted average, will again be four stars for 2025.
David: The wind forward, our focus will be on further growing our Evan Ruth chassis to continue to serve Medicare lives.
David: Overall, our quarterly results reflect clear strategy and strong execution resulting in attractive results.
David: Now, stepping back, I want to take a moment to comment on recent headlines and speculation around our company. So, while we don't comment on media rumors, we believe that it's important to provide additional context during these unprecedented times.
David: First, there's no question that the industry is highly disrupted. For example, the Medicare Advantage market is particularly challenged, given a number of factors, including elevated medical costs, a significant change in SARS ratings for many, and the reset of the risk-adjusted revenue streams.
David: These and other forces are contributing to operational disruption for some as well.
David: As I noted, we don't comment on rumors, but what I will do is be very clear on the actions we are pursuing.
David: We continue to deploy our Access Free Cashflow for Share Repurchase.
David: With Repurchases Toiling $5.7 billion year today, including over $715 million in October.
David: Looking forward to be expected to do actively to purchase our shares in the fourth quarter. Further leveraging our remaining repurchase capacity, which stands at $5.6 billion.
David: I want to transition and cover several actions we are driving in the third quarter and throughout 2024 that address the forces of change of the reshaping to face the healthcare. While we continue to position our company for growth for the benefit of our clients, our customers, and our patients.
David: The first is the pace and rate the pharmacological innovation and it continues to search.
David: Many of the treatments coming to market are meaningful and extending and improving quality of lives. For example, through new genes that are being embraced through treatments, but they are pressuring affordability given the high-liss price for manufacturers.
David: Ever North, especially pharmacy business, accreted is continuing its strong growth trajectory, giving both the secular tailwinds and our differentiated strengths, which make us the market leader in the space.
David: The opportunity by ourselves is a good example of how we're leading the way and providing more value.
David: At the end of June we began dispensing our interchangeable bioscent alert for Humira.
David: A reclete that by a similar penetration was approximately one-third among eligible pre-copations in the quarter.
David: Billion that success several weeks ago we announced it will begin offering an interchangeable to Storra by a similar in 2025. Like you might realize similar, it will be available for a zero dollar out-of-pocket for eligible which provides savings for individuals as well as clients.
David: Another example of our leadership is the GLP One Drug Class, which is on pace to be the number one drug train driver for plant this year. Another expensive, with manufacturers list price of approximately $15,000 a year.
David: In Express Groups, our Pharmacy Benefit Service Business, the Insurcle RX solution provides a clinical program wrapper around the medication to support sustainable and positive lifestyle changes for patients as well as improve affordability and access for clients.
David: I'm pleased to share that in the quarter in Circle has already grown to almost 8 million lives now in Rome.
David: The pace of change in pharmacology and industry is also why we continue to practically address misconceptions and misinformation around the pharmacy benefits industry. This is vital to ensure that patients and individuals continue to maintain access to affordable, high quality prescriptions.
Speaker Change: I'm Dr. Dennis Carlton, Professor of Economics and Meritist from the University of Chicago, and former DOJ economists, released the comprehensive review of the PDM industry.
Speaker Change: [inaudible] analysis on approximately 20 billion 30-day equivalent restrictions.
Speaker Change: The finally of Dr. Carlson's research in direct contradiction with the FTC's report concludes that PBS's lower hydrochrysis by fostering competition amongst rival drug manufacturers and pharmacies.
Speaker Change: Vivian Facultate Board of Access, the Generic Medications, in addition to name brand alternatives, which lower costs.
Speaker Change: An important leave PBM support independent pharmacies with high reimbursement rates and chains. And the number of independent pharmacies is increasing.
Speaker Change: We will leverage Dr. Carlton's study as we continue to engage in fact-based discussions about these critical issues.
Speaker Change: Moving to the second rapidly changing trend, the increased need for quality behavioral services, which is a part driven by geopolitical, economic, social dynamic, tensions that are unfolding around the globe.
Speaker Change: For context, in the past five years, we've seen overhaul the behavioral therapy utilization nearly doubled.
Speaker Change: Now in the same period, we've worked to increase services and access. For example, adding almost 270,000 providers to our network.
Speaker Change: Assessing the needs of those lower complexity issues and offering new coaching programs.
Speaker Change: and implementing online scheduling and access with appointments guarantee within 72 hours, which millions of signals your customers cannot pursue.
Speaker Change: This is another example of how our businesses have complementary capabilities as we learned from behavioral health innovation services from Abernorith and a bed then into signal care solutions.
Speaker Change: The final trend I will touch on is technology-enabled innovations.
Speaker Change: Well, we begin to see the profound changes as emerging technologies such as AI Power Diagnostics and Treatments will drive vast improvements, including more personalized care.
Speaker Change: Another example is the ongoing adoption of virtual services, which is rapidly rising with about 25% of 25% of patients accessing care through telehealth services last year in the U.S. This far exceeds the 5% of your who access care this way prior to the pandemic.
Speaker Change: We continue to advance in this area with our telehealth platform MDLive. We have offered MDLive for our customers since its acquisition in 2021 and last month we took another step forward.
Speaker Change: with patients that have lower health risk issues enabling them to get fast flexible care without a phone call or video call whenever and wherever they want with MDLive Physicians via an online portal.
Speaker Change: and patients typically are able to receive treatment within one hour.
Speaker Change: At the Cigna Group, we're built to create and capture value from these forces of change for the benefit of those we serve.
Speaker Change: Next I'll transition to provide some context relative to the tailwinds and headwinds we anticipate for 2025. Now we'll provide detailed guidance as we always do during our fourth quarter call.
Speaker Change: Some notable tailwinds include our continued ramp-up of biosimilar offerings.
Speaker Change: continued advancement of new client relationships and EPS accretion from the divestiture of our Medicare business, specifically the impact of share repurchase from the sales proceeds.
Speaker Change: Now turning to headwinds, we expect a lower net investment income as we will no longer recognize the dividend from our village MD investment.
Speaker Change: We anticipate constrained overhead from the sale of our Medicare Advantage business, which we will mitigate over time.
Speaker Change: And we will make continued strategic investments across our portfolio to drive sustained innovation and position ourselves for long-term growth.
Speaker Change: Considering all the puts and takes, we expect another strong year of growth in 2025 with EPS growth at at least 10%, which is consistent with our historical approach where we start the year with appropriate prudence.
Speaker Change: Now I'll briefly summarize our performance for the quarter.
Speaker Change: Building on our momentum, our focus in Discipline 3rd Quarter Execution positions us to meet our full year 2024 and long-term growth targets.
Speaker Change: The Cigna Group has earned a reputation for delivering differentiated value for those we serve and driving new innovation in ways that lead the industry.
Speaker Change: Our ability to consistently do this year after year is directly attributable to the strength of our leadership team and the passion and commitment of our 70,000 colleagues worldwide.
Speaker Change: and the deliberate structure of our company which is designed with growth platforms capable of navigating even the most dynamic environments.
Speaker Change: As a result, in the third quarter, we delivered on our financial commitments with adjusted EPS of $7.51 and we remain on track to deliver full-year adjusted earnings per share of at least $28.40 in 2024.
Speaker Change: Our company has attractive and sustainable growth opportunities over the long term, and we remain confident in delivering our continued average annual EPS growth rate of 10 to 14% on average, building on our track record of achieving 13% adjusted EPS on a compounded growth rate over the past decade.
Speaker Change: With that I'll turn it over to Brian to share additional perspective on our performance for the quarter and our outlook for the rest of the year.
Brian Evanko: Thank you, David. Good morning, everyone.
Brian Evanko: Today, I'll review Cigna's third quarter 2024 results and discuss her outlook for the full year.
Brian Evanko: During a year where the environment has been highly disrupted and dynamic, we're pleased with another quarter of strong results.
Brian Evanko: highlighting our consistent execution and delivering against our prior commitments.
Brian Evanko: Key consolidated financial highlights for the third quarter include revenue of $63.7 billion and adjusted earnings per share of $7.51.
Brian Evanko: These results combined with our breadth of capabilities in diverse portfolio businesses reinforce our confidence in our full year 2024 adjusted earnings per share outlook of at least $28.40.
Brian Evanko: representing more than 13% year-over-year growth.
Brian Evanko: Thank you.
Brian Evanko: Now turning to our segment results, I'll
Brian Evanko: Evernorth continues to deliver strong results driven by consistent execution across our businesses.
Brian Evanko: with particularly significant growth within our specialty and care services business in the third quarter.
Brian Evanko: Total EverNorth revenues for third quarter 2024 grew to $52.5 billion and pre-tax adjusted earnings grew 9% to $1.9 billion, slightly ahead of expectations.
Brian Evanko: This growth came despite a $33 million headwind to net investment income related to the absence of the Village MD dividend.
Brian Evanko: Our strong EverNorth results reflect our continued execution amidst the ongoing long-term trend of pharmacological innovation.
Brian Evanko: With rising clinical needs, the introduction of new therapies to the market, and more availability of biosimilars, Evernorth is well positioned to assist patients and clients in navigating these trends.
Brian Evanko: Moving to our businesses within Evernorth.
Brian Evanko: Specialty and Care Services Revenue of $23.8 billion and Adjusted Earnings of $825 million, both grew 23% in the quarter.
Brian Evanko: While we had expected strong contributions in the quarter, this performance was above expectations.
Brian Evanko: reflecting growth across our specialty of specialty medications.
Brian Evanko: Additionally, the quarter also benefited from increased adoption of Humira biosimilars.
Brian Evanko: The increased adoption benefits both patients through lower out-of-pocket costs, as well as clients through lower net costs.
Brian Evanko: And in the quarter, we saw approximately one-third of eligible Hemera scripts transition to biosimilars.
Brian Evanko: As we have highlighted, we are the leader in the specialty market.
Brian Evanko: and we are confident in delivering long-term profitable growth.
Brian Evanko: given the pipeline of new drug innovation and our decades of experience in the space.
Brian Evanko: is we've established a differentiated business model with proven, superior clinical outcomes for complex, high-cost conditions.
Brian Evanko: Pharmacy Benefit Services also posted
Brian Evanko: Driven by the addition of new business wins.
Brian Evanko: expansion of existing relationships and continued demand for new drugs through our innovative products and solutions.
Brian Evanko: Pre-tax adjusted earnings increased to one billion dollars as our differentiated capabilities continue to drive affordability and value to our patients, customers, and clients.
Brian Evanko: Overall, Evernorth delivered results
Brian Evanko: even while absorbing the aforementioned net investment income headwind.
Brian Evanko: and we continue to expect accelerating growth in the fourth quarter.
Brian Evanko: Regarding Cigna Healthcare, third quarter 2024 revenues were $13.3 billion.
Brian Evanko: Pre-tax adjusted earnings were 1.2 billion dollars and the medical care ratio was 82.8 percent.
Brian Evanko: The medical care ratio is in line with expectations.
Brian Evanko: As we have discussed, we planned and priced for elevated trend coming into the year.
Brian Evanko: During the quarter, we did observe elevated trends in specialty medications in our Cigna healthcare book.
Brian Evanko: This is consistent with the higher volumes we saw in our specialty and care business within Evernorth.
Brian Evanko: and speaks to the balance of our well-diversified portfolio.
Brian Evanko: which we intentionally created to position our company for some of the highest growth secular tailwinds in healthcare.
Brian Evanko: Overall, Cigna Healthcare delivered solid results this quarter, demonstrating consistent, steady execution in a dynamic environment.
Brian Evanko: Thank you for watching.
Brian Evanko: Now turning to our outlook for full year 2024.
Brian Evanko: Given the strength and diversity of our portfolio, we have the confidence to reaffirm our full year 2024 expectation for consolidated adjusted earnings per share of at least $28.40.
Brian Evanko: Moving to our 2024 outlook for each of our growth platforms.
Brian Evanko: In Evernorth, we continue to expect full year 2024 pre-tax adjusted earnings of at least $7 billion.
Brian Evanko: This reflects a continued acceleration of earnings in the fourth quarter.
Brian Evanko: driven by strength and specialty volumes and increasing adoption of Humira biosimilars.
Brian Evanko: as well as the continued advancement of new client relationships.
Brian Evanko: This is partially offset by lower expected net investment income.
Brian Evanko: For Cigna Healthcare, we continue to expect full year 2024 pre-tax adjusted earnings of at least $4.775 billion dollars.
Brian Evanko: And we are maintaining our full year medical care ratio outlook of 81.7% to 82.5%, although we now expect to be toward the high end of the range.
Brian Evanko: due to the aforementioned increase in specialty medication utilization.
Brian Evanko: which we expect to continue through the fourth quarter.
Brian Evanko: We expect the impact of the higher fourth quarter MCR to be offset by other levers within Cigna Healthcare, such as operating efficiency.
Brian Evanko: Thank you very much.
Brian Evanko: Turning to our 2024 Capital Management position.
Brian Evanko: We remain confident in our strong balance sheet and cash flow generation.
Brian Evanko: due to our efficient, asset-like strategy that delivers attractive returns on capital.
Brian Evanko: I would note that timing related items impacted third quarter cash flow from operations.
Brian Evanko: We are anticipating a meaningful step up in cash flow in the fourth quarter and our capital deployment priorities remain consistent with our long-term framework.
Brian Evanko: Regarding share repurchase, year-to-date through October 30th, 2024, we have repurchased approximately 16.9 million shares of our common stock for approximately 5.7 billion dollars.
Brian Evanko: including our repurchase of 715 million dollars in the month of October alone.
Brian Evanko: We continue to expect additional share repurchase in the fourth quarter.
Brian Evanko: demonstrating our confidence in the strength and sustainable growth of our business.
Brian Evanko: Now to recap.
Brian Evanko: Strong results through the first three quarters of the year give us confidence to deliver on our full year 2024 Adjusted Earnings Per Share outlook of at least $28.40.
Brian Evanko: representing over 13% year-over-year growth.
Brian Evanko: toward the higher end of our long-term average adjusted EPS growth target range.
Speaker Change: As David mentioned, we look forward to providing our 2025 outlook on our fourth quarter earnings call.
Speaker Change: We are confident in delivering another year of competitively differentiated EPS growth of at least 10%.
Speaker Change: consistent with our historical approach where we start the year with appropriate prudence.
Speaker Change: The ability to consistently meet our financial commitments is a testament to our team executing to drive value for our clients and customers and our portfolio of complementary businesses that we've strategically positioned for strong, stable, and sustainable long-term growth.
Speaker Change: And with that, we'll turn it over to the operator for the Q&A portion of the call.
Speaker Change: Thank you.
Speaker Change: Ladies and gentlemen at this time if you do have a question please press star 1 on your touchtone phone. If someone asks your question ahead of you you can remove yourself from the queue by pressing star 2. Also if you are using a speakerphone please pick up your handset before pressing buttons.
Speaker Change: Our first question comes from the line of AJ Rice. With UBS, your line is open.
AJ Rice: You obviously had a little bit of elevated commercial trend this year, but you said all year long that you were able to price for it and anticipate it. I wonder if this early date, as you look out to 2025, are you assuming more of the same?
Speaker Change: push back from employers on taking that approach if you are again. And then on the Village MD, I know you laid out a strategy for working with them as one of the ways that Evernorth can address
Speaker Change: primary care market. Obviously, that situation is in flux. I wonder if there's any pivots the company is considering and how important putting something in place with respect to physician groups, particularly primary care, it is for the overall Evernote strategy.
Speaker Change: Good morning, AJ. It's David. Let me ask Brian to take your first question relative to trend 24 and 25 and then I'll provide a little color on village and specifically our value-based care strategy and where we go from here. Brian?
Brian Evanko: Good morning, AJ. So, first off, we're very pleased with the strength of our U.S. employer business with Insignia Healthcare. That business continues to perform well for us.
Brian Evanko: And, as a reminder, our U.S. employer book is nearly 85% ASO or self-funded, which includes earning levers that go well beyond the peer risk-based MCR. That said, our U.S. employer book is currently operating from a position of strength.
Brian Evanko: as we've been performing within our target margin ranges here in 2024. As it relates to the external market, to your point on employers, we characterize the environment as competitive but rational.
Brian Evanko: given that continued elevated cost trend expectation, the firm competitive environment, as well as our desire to preserve our margin levels.
Brian Evanko: So, David, I'll turn it over to you to talk about the village piece. Sure. AJ, so relative to village, you brought up part of your question, talks about the strategy. So stepping back first and foremost.
David: VBC value-based care from our point of view is how do we align incentives, leverage information, and then leverage clinical resources and extenders to deliver improved overall quality and ultimately value?
David: within our Cigna health care platform that's done day in day out for collaborative accountable care relationships.
David: and those relationships continue to evolve.
David: Those are partnered relationships, leveraged relationships that we drive forward.
David: Increasingly, some of Evernote's capabilities are in support of that.
David: Second, specific to the village MD relationship.
David: We sought to accelerate that through our Evernorth Accountable Care relationship.
David: for lives and patients outside of those that were within our program and chassis on the benefit side of the equation, and in hindsight, the timing of that, given the disruption to the marketplace, including the risk adjuster disruption and some of the cash flow disruption from some of the underlying investors proved to be poorly timed.
David: Moving forward from an Evernorth standpoint, the Evernorth Accountable Care Relationships will continue to probe and identify where and how we can expand relationships. I would note that we do continue to make very good progress of deepening relationships with healthcare professionals out of Evernorth, specifically off of our Cura script.
David: and I'm here to talk about the new risk-adjustment capabilities that could be used to grow meaningfully, but we will continue to take a paced path with the Evernorth Accountable Care relationships currently, given the disruption, again, meaningfully caused by the change in the risk-adjustment environment. Thanks, AJ.
David: Thanks.
Speaker Change: Thank you. Our next question comes from Justin Lake with Wolf Research. Your line is open.
Justin Lake: Thanks. Good morning. First, I want to follow up on, David, your comment around capital deployment and some of the rumors out there in the market. Just to be clear, you talked a lot about the share repurchase in 2024, which has been significant.
Justin Lake: Are you, you know, the last time we had this discussion you also talked about a forward year and where you kind of saw the predominance of capital going as well. Are you also saying, or did I miss that you were going to talk about that, that you were going to deploy capital to share repurchase, or the vast majority to share repurchase in 2025 as well?
Speaker Change: and then just on the business, can you give us some more color on what's going on in specialty? You know, there have been a few companies talking about that. What do you think is driving that and, you know, any other specifics you can give us, we'd appreciate it. Thanks.
Speaker Change: Good morning, it's David. Let me take your first question and then I'll ask Eric to give you I think your broader second question is relative to what's transpiring in the specialty space
Speaker Change: So, first, to the specific part of your question,
Speaker Change: You didn't miss anything I communicated. We've not provided detailed guidance for 2025. We'll provide more comprehensive guidance, as we always do on our fourth quarter call.
Speaker Change: and we'll look forward to doing so. Second, stepping back, as I noted in my prepared remarks,
Speaker Change: Given the disruption in the space, we wanted to ensure that we had as much information out there and the clarity put forth.
Speaker Change: I'd ask you maybe to step back and reflect for a moment. If you think about, to the core of your question, what we've done, our actions that both Brian and I reinforced.
Speaker Change: Meaningful share repurchase in 2024, which has been on strategy, repurchasing through the month of October and expected to repurchase in the fourth quarter. If you reflect back on the last four years we've repurchased about 24 billion dollars of our stock, right, that was strategically guided as we were harnessing the benefit of the combination. We did have some divestitures within the context of that and as we leveraged the broad cash flow generation of our asset like portfolio and capabilities.
Speaker Change: So, I would ask you to stay tuned for more comprehensive 2025 guidance, but reflect on our disciplined track record of being a good steward of capital and demonstrating the ability to create real sustained shareholder value in the way we deploy capital. Eric, I'll ask you to talk about the specialty space.
Speaker Change: Great. Thanks, David. And good morning, Justin. It's Eric.
Eric Palmer: As we printed our Investor Day earlier this year, the specialty market is a $400 billion market and growing.
Eric Palmer: And we're leaders in this space, driven by our focused, condition-specific model, our clinical expertise, and our overall geographic reach. And this positions us well to be helpful to our clients across the board, whether it's health plans, lawyers, health systems, and the like.
Eric Palmer: Now, specific to this quarter, this was the first full quarter where we dispensed our Biosimilary Myra, and additionally we had some expansion with existing clients choosing to move more business to a Credo, and we had broad-based volume strength as well, and I'd call out therapies.
Eric Palmer: for Inflammatory Conditions for Oncology and Neurology as areas with particularly strong growth in the border.
Eric Palmer: Now with respect to the 23% growth in the quarter, we've noted in the past that the results in any given quarter is going to depend on the timing of new volumes, new customers, new therapies being available, and so on. But over time, we expect this market to be a meaningful part of the growth of our enterprise.
Eric Palmer: We've talked about our specialty and care solutions space growing at 8 to 12% on a sustained annual basis, and all of these factors are built into our assessment there. So we continue to be well positioned in this market and quite excited about the opportunities to serve the market, to grow, and to serve our patients.
Speaker Change: Thank you for watching!
Speaker Change: Thank you. Our next question comes from Ryan Langston with TD Cowan. Your line is open.
Ryan Langston: Hi, thank you. I think in the prepared remarks you said you had 8 million lives now on the EncircleRx program. My understanding is that was only, I say only, but three to five million only just a couple of months ago. That seems like incredibly strong growth and demand. I guess
Ryan Langston: What's driving that and I guess where do we see that pickup moving over the next couple of years just given it seems in the past couple of months that's that's risen
Ryan Langston: pretty dramatically. Thanks.
Eric Palmer: Good morning, Ryan. It's Eric. Thanks for the question. As you can imagine, there's real interest and need from our clients as they're looking for help with managing the affordability of...
Eric Palmer: the relevant clinical markers and engage patients with the support they need to help make
Eric Palmer: changes that make the impact last, provides a guaranteed clinical outcomes to our clients.
Eric Palmer: and provides a strong overall return for the investment in the program. You know, performance so far is that the solution is working well. The early results, our clients are enrolled, they're seeing significant savings and reductions in trend compared to those who are not enrolled.
Speaker Change: to mature the process or mature the data, we'll have more to report here. David, maybe any other perspective you'd wanna share? Sure, thanks. I'll just amplify two points.
Speaker Change: As we all spend a significant amount of time in the market, we're a field-based organization. This is typically a top one, two, or three topic with clients.
Speaker Change: with brokers, with consultants, and with others in the market. So, as we noted, GLP-1s remain front and center. The specific piece I would add, though, is, as the market continues to absorb the challenges of affordability, the market also is observing, and clients are observing, and physicians are observing.
Speaker Change: the start and stop dynamic that is transpiring for some patients, which also doesn't generate the desired or intended outcome if a patient starts on a regimen and stops in eight months, and then maybe starts up and then maybe stops as well. So folks are really
Speaker Change: The value proposition really resonates relative to the clinical wrappers, the care wrappers, the coaching wrappers, the behavioral support wrappers that exist in the values-based care nature of the underlying program. So I appreciate you calling out the growth because it is significant and it underscores the need for innovation.
Speaker Change: that we lead as these new treatments come to market.
Speaker Change: All right. Thank you.
Speaker Change: Thank you. Our next question comes from Lisa Gill with J.P. Morgan. Your line is open.
Lisa Gill: Thanks very much. Good morning. Can you maybe talk about the 2025 selling season on the PBM side? I'm just really curious around a few things. One, as we have more biosimilars, are we seeing a change in the economics of how contracts are formulated going into 2025? And then just as a follow-up, you know, David, you highlighted the FTC report and the report that, you know, the University of Chicago professor looked at. Is there any update on potential legislation or anything you're seeing from a state perspective that potentially is using some of this information when they're thinking about legislation?
Lisa Gill: Lisa, it's David. Let me ask Eric to start with the Evernord selling season including the the PBM dynamic and what's transpiring and then I'll address your FTC question.
Lisa Gill: Great.
Eric Palmer: Thanks David. Good morning, Lisa
Eric Palmer: Fundamentally, we start with a portfolio that's equipped to offer choice and flexibility in how we work to support our clients. We work to make the pharmacy benefit accessible for the patients and more affordable and we continue to innovate to bring new ways to the market to do that. And stepping back Evernote is well positioned to continue to grow.
Eric Palmer: The strength of those innovations and our solutions continue to resonate. And just as we talked about the growth in Encircle, we continue to have growth in our various innovative programs.
Eric Palmer: Now, specifically with respect to the Pharmacy Benefits Services business for 2025, we had a good 2025 selling season and our retention rate continues to be consistent with recent years in the mid to high 90s percent range. We're driving meaningful innovations.
Eric Palmer: services, what financing arrangements are going to best align with our clients' needs, but I wouldn't call out any wholesale or substantial change in terms of what our customers and clients are actually purchasing from us.
Eric Palmer: David? Lisa, relative to DFTC, I think the end of your question really pointed toward legislation, but let me just pull that for a moment. First and foremost, and you know the space extremely well, right?
Eric Palmer: PBMs and pharmacy benefit service industry exists to create real, sustained, differentiated value.
Eric Palmer: through improved affordability, through expanding access to services that are more affordable like generics, through patient coordination and clinical coordination programs, which are especially critical for the chronic and polychronic population. And as a validation of the value we deliver, our client retention levels reinforce that with historic client retention levels in the 95% plus range. And as we look to the year ahead in 2025, it being even at the higher end of that range.
Eric Palmer: And secondly, as we've talked about, whether it's through Encircle, through the Biosimilars, our ability to continue to lead the market with innovations that deliver more value, especially with new treatments coming to market, is mission critical. Specific to the FTC report, let me be really clear. We disagree on the unfounded assertions that were put forth.
Eric Palmer: Second, the clear direction that was put forth by Dr. Carlton's report.
Eric Palmer: is in direct contrast to that. And going forward, we will engage in fact-based conversations. As relates specifically to legislation, we do not see any specific, fully mature proposed legislation right now that looks like it will be put forward. Obviously, there's a bit more time left in the year. There's no doubt relative to that. We remain actively engaged. I was in Washington on Monday of this week on a variety of topics. We remain actively engaged. But I think most importantly, and capping it off, we're confident in the durability of our model, our proven ability to partner, our proven ability to drive ongoing innovation to make sure we are able to continue to grow and deliver the value both in the pharmacy benefit service space as well as in the specialty space.
Speaker Change: Great, thanks for the comments, David.
Speaker Change: Thank you. Our next question comes from Andrew Mock with Barclays. Your line is open.
Andrew Mock: Hi, good morning. You called out planned investments across both core PBM and specialty in the release and it sounds like that will continue into 2025. Can you give us a little bit more detail on the nature and magnitude of those investments? Thanks.
Brian Evanko: Good morning Andrew, it's Brian. So as we tend to do in any year, we have a fair amount of our discretionary capital that goes back into internal reinvestments.
Brian Evanko: Capital being returned to shareholders. So this year we're tracking to call it a billion five or so of discretionary CapEx.
Brian Evanko: and that's kind of over and above the core administrative expenses, which are round numbers, about $20 billion that we spend in a year. So most of that will go toward technology.
Brian Evanko: going forward so that some of that's customer or patient facing technology, some of that is provider facing technology.
Brian Evanko: and some of that is broker or field-facing technology as well. So, the majority of when you think about our discretionary CapEx is headed in that direction. And as we think about the long-term growth opportunity we have, for example, in the specialty space,
Brian Evanko: which is already a $400 billion addressable market growing at the secular high single digit type rate. We see opportunities to continue strengthening our capabilities there to make ourselves even more relevant. So think of it as primarily technology and we gear that up or down at any given year.
Speaker Change: Thank you for watching!
Speaker Change: Thank you.
Speaker Change: Our next question comes from Erin Wright with Morgan Stanley. Your line is open.
Erin Wright: Great, thanks so much. I wanted to dig into specialty a bit more. It just sounds like you're seeing the traction with the Humira biosimilar strategy. Just how would you compare that to the strategy around products like Stellara and the ramp you expect with Stellara relative to what you saw with Humira and other biosimilars that are coming down the pipe? I guess, how do you think about the cadence of that opportunity over the next several years, but also just in terms of 2025 from an LOE perspective? Thanks.
Eric Palmer: Hi Aaron, it's Eric.
Eric Palmer: I appreciate the question. Stepping back, I think the model that we've built here and that we've deployed around our biosimilar Hemira has provided another good choice in the market and it's one that we think we're well positioned to replicate in the appropriate situations going forward. As David mentioned,
Speaker Change: and his prepared remarks.
Speaker Change: We will be launching a no out-of-pocket cost alternative to Stelara in 2025, and I can envision us using this playbook and approach for additional biosimilars as we look ahead into the coming years.
Speaker Change: We noted at our investor day earlier this year that we see
Speaker Change: nearly a half of the specialty market having biosimilar alternatives choice available in terms of bringing new affordability to the market. And this is one example of a strategy that will help to improve the affordability and the accessibility of these medicines for the patients that need them and for the plan sponsors that are funding them. So every different therapy will have a different
Speaker Change: Thank you.
Speaker Change: They'll have different kind of adoption paths based off of the clinical needs of the patients being served, based off of the rate and pace of availability of products and such. But at a macro level, we're really well-positioned to continue to lead in this market and bring new solutions to market, just like we did with the Biosimilar Humira, like we are in the process of doing with Stelara, and like we'll do with other drugs coming after that. David?
David: Aaron, just one point I want to add to Eric's comment relative to the specialty market specifically, and maybe it's a statement of the obvious, but when we operate in an environment of elevated medical cost pressure, which the industry is seeing in a broader sense,
David: You could also think about the high-performing nature in this case of our specialty capabilities both through Acredo as well as through CuraScript, in some ways provides us a natural structured hedge against the medical cost pressure that is natural to manifest itself on the benefit side of the equation. So, when we talk about the conscious way we've structured the corporation, we've structured it obviously with different addressable markets, we've structured it with an asset-light framework,
David: The structure provides some natural hedge when inflationary pressure or utilization pressure manifests on one side. It also provides growth opportunity and value capture opportunities on the other side of our very diverse portfolio. So I just wanted to punctuate that.
Speaker Change: Thank you. Our next question comes from Scott Fidel with Stevens. Your line is open.
Scott Fidel: Hi, thanks. Good morning. The question, if I could try to do a two-parter, would be, one, just on the cost trend side, maybe if you could just drill in a little bit, give us an update on the inpatient side as well, in terms of, you know, what you've been seeing, their relative expectations recently. And then I did want to get your perspective just on the competitive environment for the exchanges.
Scott Fidel: in 2025. It looks like from our analysis of the CMS landscape data for the federal exchanges that we do see a number of the major carriers.
Scott Fidel: with actually negative rates in their same store plans for 2025. So, it does seem like the competitive framework has intensified quite a bit and so certainly interested in your perspectives right now on that market category as well. Thanks.
Brian: Good morning, Scott. It's Brian. I'll take I'll take both your questions here. So first off, we're pleased to have delivered another solid quarter of MCR performance within Cigna Healthcare.
Brian: with the overall performance in line with expectations, as I noted earlier. And just as a reminder, we had planned and priced for the overall elevated utilization levels that began in 2023 to continue throughout 2024. And within the quarter specifically,
Brian: We had a range of affordability initiatives that proved to be beneficial to the MCR and it had some offset to the uptick I mentioned in specialty drug utilization.
Brian: in the quarter and where we saw that
Brian: activity in particular.
Speaker Change: You asked about inpatient. Inpatient was broadly in line with our expectations in the corridor, so I wouldn't flag that.
Speaker Change: As David said, we're fortunate to have the natural hedge at the enterprise level where the elevated customer demand for specialty drugs resulted in the favorable performance we saw in our Evernorth business, specifically within the specialty and care services platform.
as it relates to the individual exchanges.
Speaker Change: So we continue to see this market as being an important sub-segment of the U.S. healthcare system.
Speaker Change: for those who don't have access to employer or government-sponsored coverages. We've been a consistent player in this market over the past decade since the ACA went into effect.
Speaker Change: And for us, 2024 has been a year focused on margin expansion in our individual exchange business.
Speaker Change: and that approach is playing out largely as we expected here with fewer customers in 2024 but carrying a higher profit margin profile.
compared to our 2023 experience.
as it relates to 2025 specifically, as you noted.
Speaker Change: the weighted average rate increase for our customer base is in the low double digits, which based on the publicly available information is on the higher end of the competitive set. That said, there's a considerable variation by geography when you dig into that.
And for us, the exact margin profile and customer volumes will be a function of geographic mix and competitor behavior in each of those different geographies. But taken all together, we continue to invest in this business, see it as a growth engine for the company, and over time, look forward to 10 to 15% annualized growth here.
Speaker Change: Thank you for watching!
Speaker Change: Thank you. Our next question comes from Adam Rahn with Bank of America. Your line is open.
Adam Rahn: Hey. Thanks for the question. I also wanted to dig into the specialty comments, but from the managed care side, you mentioned that it was the reason that you're increasing your MLR guidance, and I know that you still do currently own the Medicare Advantage company that also has a Part D business, and so wondering if you could delineate, like, the pressure that you're seeing in specialty between the Medicare side and the commercial side and on the Medicare side, if you think it's being driven by the IRA at all. Thanks.
Good morning, Adam. It's Brian. I'll start. If my colleagues want to pile on, you're welcome to. So as it relates to what we saw in Cigna Healthcare on the specialty drug side, really the uptick in the utilization was broad-based.
across most of our Acredo therapeutic resource centers in the third quarter. In particular, we saw it in inflammatory conditions, oncology, and neurology.
Speaker Change: and really just transpired across all the Cigna Healthcare product lines, commercial employer, Medicare, and the individual exchanges.
The Medicare volumes were slightly more elevated than commercial, but not enough.
that we would flag it as having a different root cause and we do not see the IRA as having driven a meaningful amount of the third quarter experience. And as I said earlier, I'm pleased to have the natural hedge with the EverNorth specialty business benefiting from those increased volumes.
Speaker Change: in the corner.
Speaker Change: And Brian, the only thing I would add is, adding to your broader question, as noted in our opening comments, but by and large, the Medicare Advantage portfolio of our business is performing in line with our expectations as we built the plan out for the course of the year. So, Brian's reference is on the margin in terms of the elevation there.
Thank you. Our next question comes from George Hill with Deutsche Bank. Your line is open.
Yeah, good morning guys. And David, I kind of want to come back to your comments on the Medicare Advantage market that you opened up the call with, which is, in the past you kind of said that MA is a strategically important market with a lot of long-term value. And in this call, you're saying it's a challenged market. So first, I guess, number one is kind of, can you help me bridge the gap between those two lines of thoughts?
And then as you look at the ME market from where you sit, given that you guys don't participate, do you see its challenges as cyclical or structural?
George, good morning. My comments relative to the marketplace are.
Speaker Change: our view, a statement of fact given the current environment, drawing back to your broader point of view, we see from a societal standpoint, MA as currently and in the future an important part of the offering to the marketplace. So be very clear.
Speaker Change: Secondly, as we've discussed before within our Evernorth portfolio today,
Speaker Change: fully approaching a third of all of our product programs and services face off against government-sponsored programs very inclusive of MA and the supporting programs around MA and we will continue to invest in and grow those programs products and services.
Speaker Change: what I was seeking to draw back to
was, again, given the disruption in the marketplace and the headline that we were drawn into to create clarity that the marketplace is disrupted and our actions and our behaviors are consistent with what we said they were going to be, specifically using our discretionary free cash flow for share repurchase. Looking forward, I would expect to see the MA marketplace.
Speaker Change: find its footing again, albeit it's going to go through a choppy phase right now for the forces I talked about before, elevated medical costs.
Significant reset the stars. So if you look back, there was a time when the marketplace had almost 90% of all lives in four star plus plans. That gets reset down to 60% plus of lives. That's a large resetting for the marketplace. The risk adjuster part of the program coming through is also quite meaningful.
So, I deem it to be transitional for the marketplace. The leaders in the marketplace will find a way to lead through this. And importantly, MA serves a very important value prop from a societal standpoint. On average, an MA life is lower income. On average, an MA life is supported with better clinical coordination, clinical efficacy. And on average, an MA life is getting better overall value and affordability. The space is just going through a choppy time right now, and that's what we're trying to call attention to.
Speaker Change: I appreciate the call.
Thank you. Our next question comes from Josh Raskin with Nifron Research. Your line is open.
Okay, so I'll harp on those. I'll sort of keep on the topic here, but
Just in terms of the cadence of buybacks, I want to understand, you guys were relatively strong in the first quarter, particularly strong in the second quarter, a noticeable pause in 3Q, and I heard, David, your response to Justin's question around this disruption in the space and wanting to get as much clarity as possible.
and then just a smaller one just on favorable development. It was a little larger in 3Q. Could you talk, were there any specific drivers of that or areas where development came in better? Thanks.
specific answer to your question, the cadence of our buybacks is driven by cash flow timing. So you'll note that our cash flow, and we've highlighted this in the past, doesn't happen ratively throughout the course of the year. So early part of the year, we expect it to have significant deployment of capital. And towards the latter part of the year, we expect to have significant deployment of capital. So specific to your question, the timing and cadence of deployment of free cash flow is
Speaker Change: tied to the timing of the cash flow generation and the fourth quarter will be a high cash flow generation order for us and we highlighted the fact that we are quite active in the marketplace noting the share repurchase through the the month of October thus far. Brian, can I ask you to take the second part of the question?
Brian: Sure, David. Good morning, Josh. So, as it relates to the prior year development that we saw in the third quarter, it was a little bit higher than we typically would see in the third quarter, but...
It's important to keep in mind that that's gross prior year development, which doesn't translate one for one to a net P&L impact, just given the variety of factors like client sharing, MLR rebate impacts, and other items.
And in any given period, we tend to see fluctuation, as you can appreciate, in reserve development from year to year, quarter to quarter. And overall, the net P&L effect of prior period reserve development was not a significant driver of the Cigna Healthcare MC or the Cigna Healthcare income in the third quarter.
So, appreciate the questions.
Speaker Change: Thank you. Our next question comes from Lance Wilkes with Bernstein. Your line is open.
Speaker Change: Thank you for watching!
Lance, your line is open. You may need to unmute yourself.
Lance Wilkes: Thanks so much. Just a couple of cleanup questions and one broad strategic question. On the strategic level, as you're looking at deployment of capital and as you're thinking about inorganic
How do you look at things from a management and board level with respect to management stability, stability and volatility of a business model, etc.? And are there other important criteria we should be aware of? And the little items are just...
over in the employer market, even high premium inflation, are you seeing different behaviors from employers? Whether that's faster shift to ASO or you know certain types of cost containment features that they're looking for. Thanks.
Good morning, it's David. Let me take your
your strategic question specific to M&A criteria, and then ask Brian to take your follow-up. You painted them as clean-up. I find that interesting. But specific to your strategic question, if you step back and think about our M&A criteria, which is a core of your question, our criteria has not changed. And to remind you, first is strategic alignment.
Then second is financial attractiveness. I'll come back to that in a moment And then third is our need to see a clear path to close as it relates to financial attractiveness We take into consideration EPS accretion so the level of the timing of the visibility of the durability of
We also look at capital efficiency, return on invested capital, on a relative basis in terms of assessing it. So, to the core of your question, if I heard you correctly, a more disrupted environment or a less stable asset would increase the beta.
increasing the beta requires a higher visibility to highly durable synergies, value capture, and the durability of that.
So, the core of your question is, of course, we have to consider that.
and the closer adjacency versus farther adjacency and the more stable and predictable versus the more volatile has to be taken into consideration. And I will end with, I believe we have a very clear, good track record.
of applying these criteria and creating shareholder value over a long period of time.
Speaker Change: Brian, I'll transition to you.
Brian: Yeah, Lance, on the second question in terms of how employers are reacting to a higher cost trend environment, a few things to highlight there from our U.S. employer portfolio. Affordability is generally the number one topic when we talk to employer clients, and historically they'd look at benefit buy-downs, changes to deductibles and out-of-pocket maximums and maybe premium contribution changes, but the strategies are becoming more precise.
Brian: and more granular now. So, as an example, we're seeing more and more interest in our specialty pharmacy capabilities.
programs like the EncircleRx to help mitigate GLP-1.
spending and ensure clinical appropriateness of all those programs. So we're seeing interest in more precise affordability programs. We're also seeing a lot of interest in our mental health and substance abuse capabilities.
Since the pandemic started this has been a higher cost trend category and even this year It's contributing about 1% to employer cost trends just in the year
Brian: So there's interest in...
the link between mental and physical health, which has been shown mental health utilization deflects physical health needs down the line. And then finally, there's interest in more precise provider network configurations that help to optimize cost, quality, incentive alignment. So things like our PathWell specialty offering, things like our PathWell bone and joint program.
So all those things are of increased interest to employers in a high-trend environment. Taken all together, our Cigna healthcare offerings are well-positioned to address those themes.
Brian: Thanks.
Speaker Change: Thank you. Our last question comes from Michael Hoff with Bayer. Your line is open.
Michael Hoff: Hi, thank you. Firstly, on 25 headwinds and talons, thank you for providing that list and your parent marks.
I was just wondering if you could maybe flesh that out a bit more, specifically, which of those building blocks, perhaps, are you most confident about in terms of helping you on your path to 10% or at least 10% EPS growth next year? And then following up on Aaron's question, maybe a different approach to it.
Brian: I know about similar
Brian: quickly rose to 20% share of your specialty book last quarter. Where has that trended in third quarter? Where do you see both Humira biosimilar adoption, which I believe is now one-third of eligibles, and that biosimilar percent share of specialty book trending into year-end and over the next year? And then as I think about Evernorth earnings growth,
Brian: going forward. Are we officially now in that sort of new paradigm of earnings contribution at Evernote from dollars and layers? Thank you.
Michael, good morning. It's David. You packed a lot in there for us to begin to bring our call to a close in short order, but important topics.
So first, let me just frame a little bit of the headwind, tailwind framework and then ask Brian to peel it back a little and give you a bit more specificity. And then we'll transition to Eric, who will talk about the trends, the direction, etc. I don't think we're declaring a new normal, as opposed to the growth trajectory we see relative to that business.
in the 8-12% compounded over time, which is above the secular trends. But let me shift back to the headwind-tailwind. As I noted in my prepared remarks,
will provide much more detail in our fourth quarter calls. We provide the 2025 outlook and guidance as we always do. Importantly, and we want to stress, this will come off a 2024 which is going to be another strong year and competitively differentiated year.
Brian: and our outlook for 2025 will be a strong year and competitively differentiated year.
Speaker Change: As you put them all together, even at this point, we're confident to step forward and say that our growth algorithm will be intact for 2025, yet we would expect to guide at the lower end of our algorithm range with taking a posture of prudence. So, Brian, could I ask you to give a little bit more color on some of the drivers, within the headwinds and tailwinds and some dimensioning?
Brian: Sure, David. Good morning, Michael. I'll give you maybe a little bit more detail on the three tailwinds and three headwinds that David outlined earlier on the call. So in terms of the three tailwinds we see for 2025,
Brian: Continued biosimilar adoption is one. Obviously that's been a theme throughout the morning here and we do have a high degree of confidence in that being delivered in 2025. Secondly, we expect advancements
in our large PBS client relationships. Obviously we had a very sizable new client in 24. We also have others that we've on board in recent years. And then the third tailwind is EPS secretion from the deployment of the Medicare sale proceeds.
And given we know the magnitude of this, we would expect this to be a low single-digit percent impact on 2025 EPS when you think about the deployment of those proceeds.
That's offset by three primary headwinds that we see at this juncture. The first is the absence of the 2025 Village MD dividend recognition. So as I made reference to earlier, that was $33 million in the third quarter. You annualize that out, it's about $130 million.
of the headwind for 2025 to the Evernorth segment income, as well as obviously the enterprise.
Brian: AOLI
Secondly, we will have some stranded overhead from the Medicare divestiture.
which is currently at about $150 million for the year.
And you can think of that as split roughly half and half between Cigna Healthcare and Evernorth.
Brian: And obviously, our teams will work to whittle that down over time, but we see that as about a $150 million headwind for 2020.
Brian: And then finally, continued investments for long-term growth, as I made reference to in an earlier question.
that will gear up or gear down.
Brian: depending on the market opportunities that we see as we balance short-term and long-term needs for the company.
Eric Palmer: So, Eric, you can pile on here on the biosimilars part of the question. Great. Thanks, Brian, and thanks for the question, Michael. With respect to Humira, a couple of notes I wanted just to be clear on. We began dispensing our biosimilar Humira at the end of June. We noted in our second quarter call that throughout the month of July, we had achieved about 20% or about 20% of our customers had elected to use the biosimilar Humira, and that's grown throughout the quarter. What we provided today was that across the third quarter in its entirety now, about 33% of the eligible patients had adopted it. So really nice growth throughout the quarter. We would expect that to continue to grow over the balance of the year. And to your more macro question, I'll step back for a minute.
At our Investor Day back in March, we again increased the top end of our long-term growth range for EverNorth up to 5% to 8% growth, and that reflects all of these dynamics.
I think the fourth time we increased the growth trajectory of EverNorth since EverNorth was launched just a few years ago And we're excited about the opportunity to continue to grow in this space Harnessing the positive forces that we've just talked about and the ability to have a meaningful positive Influence on affordability of health care and the patients that we serve overall So we're excited about the opportunity and well positioned to play a leading role here
and Brian Giacobbe. Thank you.
Speaker Change: Thank you. I'd like to turn the call back to David Cordani for closing remarks.
Thank you. I just want to briefly wrap up. Most importantly, thanks for your questions, your time, and your engagement on our call today. Just to highlight a few headlines.
Before I close, I want to thank our 70,000 colleagues around the world and our fantastic senior leadership team. It's their focus, caring orientation, and commitment that allows us to do what we do day in day out for those we have the privilege to serve.
We're proud of what we've accomplished in the third quarter and the trajectory that we have for the full year, and we look forward to talking in the future. Have a great day.
Thank you very much.
Speaker Change: Ladies and gentlemen, this concludes the Cigna Group's third quarter 2024 results review. Cigna Investor Relations will be available to the to respond to additional questions shortly. A recording of this conference will be available for 10 business days following this call. You may access the recorded conference by dialing 888-883-8000.
282-0035 or 203-369-3602. There is no passcode required for this replay. Thank you for participating. We will now disconnect.