Cigna sells health insurance to employers, governments, and individuals for premiums, while its Express Scripts pharmacy-benefit-management arm takes fees and rebates in the middle of prescription drug transactions nationwide — with that drug-benefit business alone generating 85% of total revenue on razor-thin margins.
How Cigna makes money
Cigna runs two very different businesses side by side. Cigna Healthcare sells health insurance to employers, governments, and individuals, collecting premiums and paying out medical claims. Evernorth, through its Express Scripts subsidiary, manages prescription drug benefits for employers — negotiating rebates from drug manufacturers and processing claims — earning fees along the way.
The two segments share customers and data — employers who buy Cigna health insurance often also outsource prescription-benefit management to Evernorth. Source: 10-K FY2025, Item 1 Business; Note 23 (Segment Information).
Where the revenue comes from
| Segment | Revenue | Share | Pre-tax adjusted operating margin |
|---|---|---|---|
| Evernorth Health Services (PBM/pharmacy) | $234,953M | 85.5% | 3.1% |
| Cigna Healthcare (insurance) | $47,412M | 17.2% | 8.8% |
| Other Operations | $674M | 0.2% | — |
| Corporate / eliminations | -$8,139M | -3.0% | — |
| Total | $274,900M | 100% | — |
Evernorth dominates revenue, but its margin is less than half of Cigna Healthcare's — PBM revenue mostly just passes through the underlying cost of the drugs themselves. Source: 10-K FY2025, Note 23 (Segment Information).
Geographic revenue isn't separately disclosed — Cigna operates International Health in 30+ countries but doesn't break out dollar figures by region. Given the small relative size of that international business, the company's dominant exposure is to U.S. healthcare policy (the Affordable Care Act, Medicare rules, PBM legislation) rather than currency risk.
Source: 10-K FY2025, Note 23 (Segment Information).
Customers and competitors
Cigna sells largely B2B — to large employers ("National Accounts"), mid-size employers, unions, and government agencies (like TRICARE) through both self-funded (ASO) and fully-insured contracts, with individual/family plans a smaller slice. A single PBM customer made up 19% of external revenue in 2025 (16% in 2024), and federal government contracts made up 11% (2024) / 15% (2023) — Express Scripts contracts typically renegotiate every 3 years.
- UnitedHealth Group — the largest player in the industry, vertically integrated across its own PBM (OptumRx), insurance (UHC), and care delivery (Optum Health).
- CVS Health (Aetna/Caremark) — unlike Cigna, owns a nationwide network of retail pharmacy stores, giving it a stronger offline customer touchpoint.
- Elevance Health (formerly Anthem) — a regionally dominant insurer built on Blue Cross Blue Shield licenses in specific states.
Source: 10-K FY2025, Item 1 (Competition, Miscellaneous).
The metric that matters most in this sector
The Medical Care Ratio (MCR) — the share of insurance premiums actually paid out as medical claims — is the key signal for how profitable the Cigna Healthcare segment is. A lower MCR means the insurer keeps more of each premium dollar as margin.
| 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|
| MCR | 84.0% | 81.7% | 81.3% | 83.2% | 84.4% |
MCR dipped in the post-pandemic years (2022-2023) but has climbed back into the mid-80s in 2024-2025 — a sign that medical cost inflation is once again outpacing premium increases, squeezing margin.
Source: 10-K FY2025, FY2023, and FY2021, MD&A "Cigna Healthcare" segment results.
Leadership and ownership
David Cordani served as CEO from 2009 until July 1, 2026, when Brian Evanko — a 30-year company veteran and former CFO and Cigna Healthcare president — became the new CEO. Cigna has no founder involvement (founded in 1981, long-run by professional management). Combined insider ownership across directors and executives is about 0.6%; the largest shareholders are index funds Vanguard (10.0%) and BlackRock (7.6%).
Source: DEF 14A 2026, "Election of Directors" / "Security Ownership."
Capital returns
Cigna pays an annual dividend of $6.24/share ($1.56/quarter, raised from $1.51), yielding about 2.3% at the current price, with a 25.8% payout ratio and 5 consecutive years of increases. It repurchased 11.9 million shares (about $3.6B) in 2025 and 20.9 million shares (about $7.0B) in 2024 — a meaningful chunk of the proceeds from the March 2025 sale of its Medicare Advantage business to HCSC went toward buybacks.
Source: 10-K FY2025, MD&A "Liquidity and Capital Resources"; stockanalysis.com/stocks/ci/dividend (Aug 31, 2026).
How this company could fail
- PBM rebate regulation risk — under the Consolidated Appropriations Act 2026 (enacted February 2026), PBMs must pass 100% of rebates through to employer plans starting in 2028, and Medicare Part D compensation can no longer be tied to a drug's list price — a direct hit to Evernorth's core revenue model.
- Large-customer concentration risk — a single PBM customer made up 19% of 2025 revenue, and Express Scripts contracts typically renegotiate every 3 years, meaning the loss of just one large contract could hit results immediately.
- Medical-cost forecasting and pricing risk — premiums are set before a contract year begins, but actual medical costs (MCR) have already climbed from 81.3% (2023) to 84.4% (2025); if pricing can't keep pace with actual costs, profit erodes quickly.
Source: 10-K FY2025, Item 1A Risk Factors, "Federal Legislative Developments."
Five-year financials
| 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|
| Revenue | 174,069 | 180,518 | 195,265 | 247,121 | 274,900 |
| YoY growth | — | +3.7% | +8.2% | +26.6% | +11.2% |
| Operating income (margin) | 7,941 (4.6%) | 8,450 (4.7%) | 8,536 (4.4%) | 9,417 (3.8%) | 9,200 (3.3%) |
| Free cash flow | 6,037 | 7,361 | 10,240 | 8,957 | 8,389 |
| Total debt | 33,670 | 31,093 | 30,930 | 31,972 | 31,463 |
Source: 10-K FY2025, "Executive Overview" and cash flow statement; 10-K FY2023 (2021-2023 comparatives). FCF = operating cash flow minus capex (property, equipment, and software).
What we still don't know
- How the July 2026 CEO transition (Cordani to Evanko) will change strategic direction can't be determined from this data alone — the first full earnings cycle under the new CEO would need to be checked.
- How Evernorth will actually redesign its revenue model once 2028 PBM rebate regulations take effect hasn't been disclosed yet.
- The exact revenue and profitability of the International Health (overseas) business isn't separately disclosed by region.
Frequently asked questions
How does Cigna make money?
Cigna makes money two ways: selling health insurance for premiums (Cigna Healthcare, 17% of revenue but the more profitable segment), and through Evernorth/Express Scripts, its pharmacy benefit manager, which manages prescription drug benefits for employers and earns fees and rebates from drug manufacturers (85% of revenue, but on much thinner margins since it largely passes through the cost of the drugs themselves).
What is a pharmacy benefit manager (PBM)?
A PBM like Express Scripts sits between drug manufacturers, pharmacies, and the employers/insurers who pay for prescription coverage — negotiating rebates from manufacturers, deciding which drugs are covered, and processing claims. It's a business regulators have increasingly scrutinized for how those rebates are structured.
What is Cigna's market cap?
As of this article's data, Cigna's market cap was about $73.0B, on FY2025 revenue of $274.9B.