If there was one key word to come out of Cigna's investor day on Monday, it would be "growth."
The insurer spotlighted its ambitions to expand across its enterprise, from its insurance plans to pharmacy to digital tools, at the virtual event for investors Monday morning. CEO David Cordani said that its growth plans "fuel our purpose."
The company reaffirmed its guidance for 2021 of at least $165 billion in revenue and at least $6.5 billion in earnings, or about $20 per share.
Cigna is eyeing between 6% and 8% long-term growth in both revenue and earnings, with adjusted margins of 4% to 5% after tax, executives said. Those trajectories include double-digit growth projections in government insurance.
"When you put all this together, Cigna is stronger and more resilient than we’ve ever been," Cordani said.
Cigna is taking a three-pronged path to driving growth, executives said, with a focus on delivering differentiated value, partnering and innovating and expanding addressable markets.
For example, Cigna expects its total addressable market in the U.S. to grow from $1 trillion today to $2.2 trillion by 2025, said Eric Palmer, chief operating officer at Evernorth. The aim is to achieve that in a combination of geographic growth and expanding consumer relationships.
Two key focuses for geographic expansion are Medicare Advantage and the individual market. Cigna wants to double its individual and family plan membership to 500,000 by 2025 and double the markets it serves to 20 in the same window.
Brian Evanko, Cigna EVP and CFO, spoke with investors today about Cigna's growth outlook and how Cigna's capital priorities create opportunities for future growth. #InvestorDay https://t.co/wayRaEE4f7 pic.twitter.com/0nDFvGXpyP— Cigna (@Cigna) March 8, 2021
Stabilization in the individual market is luring some insurers back to the Affordable Care Act's exchanges and pushing others to grow their reach. UnitedHealthcare scaled up its footprint for 2021, and Aetna said it plans to reenter the exchanges in 2022 after exiting amid losses in 2018.
Cigna has named Medicare Advantage a target for rapid expansion the past several years, and the company is eyeing 10% to 15% average annual customer growth in this market. The insurer also wants to reach 50% of Medicare eligibles by 2025; it currently reaches 26%.
An area the government team is looking to tap into more fully, in partnership with the commercial plan team, is to ensure members in employer-sponsored plans who age into Medicare have the opportunity to enroll in a Cigna plan.
Part of that entails expanding geographic reach, but it will also require enhanced outreach to members who are reaching Medicare eligibility, said Aparna Abburi, president of Medicare at Cigna. Abburi said that 150,000 Cigna members turn 65 each year, and thus reach Medicare eligibility, representing a significant membership pipeline that could be harnessed.
"When we show up as one company, the power of our brand is amplified," said Mike Triplett, president of Cigna's U.S. commercial business, during the event.