Company: CI
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0001739940-25-000037
Chunk: 119

Company: Cigna Group
Filing Date: 2025-10-30
Form: 10-Q
Item: Part I, Item 1
Chunk 119
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 adjusted revenues. Note 17 to the Consolidated Financial Statements also explains that segment revenues include both external revenues and sales between segments that are eliminated in Corporate. 

In these segment discussions, we also present "pre-tax margin," calculated as pre-tax adjusted income (loss) from operations divided by adjusted revenues.

See the "Executive Overview" section in this MD&A for summarized financial results of each of our segments.

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Evernorth Health Services Segment

Evernorth Health Services includes a broad range of coordinated and point solution health services and capabilities within our Pharmacy Benefit Services and Specialty and Care Services operating segments. As described in the introduction to Segment Reporting, the performance of Evernorth Health Services is measured using adjusted revenues and pre-tax adjusted income (loss) from operations.

In 2025, the Company renewed or extended contracts with the business’s largest clients through the end of the decade. Additionally, to further deliver value for the benefit of those we serve and to build a more sustainable model for health care, the Company will incur investment and transition costs to support its recently announced transformational rebate-free model for pharmacy benefits, designed to lower medication costs, improve transparency and support local pharmacies. As a result, we expect these efforts to impact pre-tax adjusted income from operations for Evernorth Health Services over the short term.

Key Factors Affecting Segment Performance

The key factors that impact the segment's revenues and income from operations are claims utilization, claims composition and contract affordability services. Specialty and Care Services revenues are also impacted by customer and client growth. These key factors are discussed further below. See Note 2 to the Consolidated Financial Statements included in our 2024 Form 10-K for additional information on revenue and cost recognition policies for this segment.

Key factors that impact both Pharmacy Benefit Services and Specialty and Care Services:

•Pharmacy claim volume (also referred to as "utilization") relates to processing prescription claims filled by retail pharmacies in our network and dispensing prescription claims from our home delivery and specialty pharmacies, along with other claims. Pharmacy claim volume is impacted by new clients or organic customer growth through the expansion of existing clients or through the loss of customers and business.

•The composition of claims generally considers the types of drugs, including the mix of claims among branded and higher priced specialty drugs compared to generic or biosimilar alternatives. We manage pharmaceutical manufacturer increases in prices through programs designed to reduce drug spend, providing positive impacts on our clients, our customers and us. Changes to claims mix, including types of drugs, distribution methods, pharmaceutical manufacturer prices, and alternative uses