CICigna

We must identify, assess and respond to new trends in the legislative and regulatory environment, as well as comply with the various existing laws and regulations applicable to our business and respond to policymakers and enforcement agencies accordingly. There are currently pending, and in the future there will likely be, legislative or regulatory proposals or executive actions which seek to manage or significantly change the health services industry, including managing prescription drug costs and health records as well as regulating drug distribution. These and other legislative ideas and executive actions could adversely affect our business. Federal and state governments have enacted, and we We expect federal and state governments to continue to enact and seriously consider, many broad-based legislative and regulatory proposals reforms that will or could materially impact various aspects of the health care and related services system, including pharmacy benefits system. In addition, manager, drug pricing or insurance market reforms. These reforms could result in material changes to government policies not specifically targeted to the health services industry, such as a change in tax laws way we conduct our business and could impact the corporate tax rate, government spending or program cuts or changes, imposition of tariffs across an industry sector such as pharmaceuticals could have significant impacts on market for our business, results of operations, financial condition and liquidity. There can be no assurance that our effective tax rate or tax payments will not be adversely affected by legislation resulting from these initiatives both within the United States and other foreign jurisdictions in which we operate. In addition, tax laws and regulations are extremely complex and subject to varying interpretations. While we believe that our historical tax positions are consistent with applicable laws, regulations and existing precedent, there can be no assurance that our tax positions will not be challenged by relevant tax authorities or that we would be successful in any such challenge. The trading price of our securities may react to the announcement of such proposals. As disclosed in Part II, Item 5 of this Form 10-K, we have an active share repurchase program authorized by our Board of Directors (the "Board"). products.

In segment discussions, we present "adjusted revenues" and "pre-tax adjusted income (loss) from operations," defined as income (loss) before income taxes excluding pre-tax income (loss) attributable to noncontrolling interests, net investment gains/losses, amortization of acquired intangible assets and special items. The Company uses "pre-tax adjusted income (loss) from operations" and "adjusted revenues" as its principal financial measures of segment operating performance because management believes these metrics reflect the underlying results of business operations and facilitate analysis of trends in underlying revenue, expenses and profitability. The Cigna Group share of certain investment results of its joint ventures reported in the Cigna Healthcare segment using the equity method of accounting are also excluded. Special items are matters that management, including the chief operating decision maker, believes are not representative of the underlying results of operations due to their nature or size. Ratios presented in this segment discussion exclude the same items as adjusted revenues and pre-tax adjusted income (loss) from operations. See Note 22 23 to the Consolidated Financial Statements for additional discussion of these metrics and a reconciliation of income (loss) before income taxes to pre-tax adjusted income (loss) from operations, as well as a reconciliation of Total revenues to adjusted revenues. Note 22 23 to the Consolidated Financial Statements also explains that segment revenues include both external revenues and sales between segments that are eliminated in Corporate. Ratios presented in the segment discussion exclude the same items as adjusted revenues and pre-tax adjusted income (loss) from operations.

The Patient Protection and Affordable Care Act ("ACA") prescribed established a risk adjustment program to mitigate the risk for participating health insurance companies selling individual coverage on the public exchanges. The risk adjustment program reallocates that transfers funds from among insurers with lower risk populations to insurers with higher risk populations based on the relative risk scores of participants. their covered populations of individuals who purchased insurance on a public exchange. We estimate our receivable recognize receivables or payable based on payables from the risk of our customers compared Centers for Medicare and Medicaid Services ("CMS") for the Company's Individual and Family Plans as adjustments to the risk of other customers in the same state premium revenue when amounts are reasonably estimable and market, considering data obtained from collection is reasonably assured, using year-to-date experience and industry studies and data. Final settlements are determined by the United States Department of Health and Human Services ("HHS"). Receivables or payables are recorded as adjustments to premium revenue based on our year-to-date experience when the amounts are reasonably estimable and collection is reasonably assured. Final revenue adjustments are determined by HHS ("HHS") in the year following the policy subsequent year.