Payers' Optimism Tempered By Economic Realities

Cigna
Q2 Profit: -2.8%
Analyst expectations: Beat
Forecast: Positive

Cigna is focusing on physician engagement to improve health outcomes and reduce costs by introducing its own version of the commercial ACO and expanding its successful HealthSpring model.

The proprietary Collaborative Accountable Care (CAC) program is an insurer/physician partnership that includes clinical support and data to enable physicians to add value to the care they provide. Cigna has 32 CACs in place, including 10 added in July alone. Its goal is to have 100 CACs serving one million members in place across the United States by 2014.

HealthSpring, the Medicare Advantage plan acquired by Cigna in 2011, is being rolled out to selected commercial clients. Cigna officials said the plan's physician partnership model, with its tightly aligned incentives and clinical management programs, is attracting the interest of employers seeking to control healthcare costs for their 65 and older employees and retirees.

The insurer is making strategic acquisitions to expand its product line. It is in the process of acquiring Great American Supplemental Benefits Group, a large manufacturer, distributor, and marketer of supplemental health insurance products.

Cigna says it will continue to develop its international business in India and Turkey through direct to consumer distribution channels. Its international focus is areas with significant middle class growth potential.