Cigna - Humana Healthcare Insurance Mega Deal Scrapped

In this iPMI Global Insights article, iPMI report author Ian Youngman, takes a look at the breakdown of the health insurance mega deal between Cigna and Humana.

Ian Youngman is a writer and researcher specialising in insurance. He writes regularly for a variety of magazines, newsletters, and on-line services. He publishes a range of market reports, and undertakes research for companies. To read his latest report, International Health Insurance 2023, please click here, or visit the REPORTS section of iPMI Global.

Health insurer Cigna has ended its attempt to negotiate an acquisition of Humana. The deal could have exceeded $60 billion in value but was certain to attract fierce antitrust scrutiny. Both insurers were happy with the principle. The companies could not come to agreement on price and other financial terms. Cigna has offered a major distraction with plans to buy in stock.

Analysis

• Neither company has so far commented publicly.
• A bigger Cigna would have been focused on improving access to care and lowering costs for consumers.
• Cigna believes a deal would have been achievable from a regulatory perspective.

What Next?

• Cigna is turning its focus toward smaller bolt-on acquisitions in the USA.
• Cigna plans to do an additional $10 billion in share repurchases, bringing total repurchases to $11.3 billion.
• The company intends to use the majority of its discretionary cash flow for share repurchase in 2024.
• Cigna will remain financially disciplined with a clear focus on executing strategy, delivering value for our shareholders, and investing in our future.
• Cigna may explore the sale of its Medicare Advantage business.