AM Best Comments on Health Care Service Corporation’s Planned Acquisition of The Cigna Group’s Medicare Business
03 February 2024 - 7:04AM
Business Wire
AM Best has commented that the Credit Ratings (ratings)
of Health Care Service Corporation, a Mutual Legal Reserve Company
(d/b/a Blue Cross Blue Shield of Illinois/Texas/New
Mexico/Oklahoma/Montana) (HCSC) (headquartered in Chicago, IL) and
its subsidiaries (see listing below) remain unchanged following its
announcement that it has entered into a definitive agreement to
acquire all of The Cigna Group’s (Cigna) (headquartered in
Bloomfield, CT) [NYSE: CI] Medicare Advantage, Medicare Part D,
Medicare Supplement and CareAllies businesses.
AM Best anticipates that HCSC will maintain its strongest level
of risk-adjusted capitalization, as measured by Best’s Capital
Adequacy Ratio (BCAR), and its overall balance sheet strength. The
transaction is projected to have a limited impact on HCSC’s overall
balance sheet metrics, and financial leverage is expected to remain
within AM Best’s tolerances with interest coverage remaining
strong. The transaction is expected to expand HCSC’s geographic
diversification with the addition of business outside of HCSC’s
core Blue Branded states. Additionally, the additional membership
and revenues will aid in providing additional scale and
capabilities to HCSC’s Medicare Advantage business.
The transaction is expected to close in the first quarter of
2025, subject to regulatory approval and customary closing
conditions. AM Best will continue to closely monitor the
transaction and the impact to the HCSC and its subsidiaries.
The ratings of Health Care Service Corporation, a Mutual Legal
Reserve Company and its following subsidiaries remain unchanged
following the aforementioned announced acquisition agreement:
- Health Care Service Corporation Group
- Dearborn Life Insurance Company
- Dearborn National Life Insurance Company of New York
- GHS Health Maintenance Organization, Inc.
- GHS Insurance Company
- HCSC Insurance Services Company
- Health Care Service Corporation-Texas HMO Line of Business
- Health Care Service Corporation-Illinois HMO Line of
Business
This press release relates to Credit Ratings that have been
published on AM Best’s website. For all rating information relating
to the release and pertinent disclosures, including details of the
office responsible for issuing each of the individual ratings
referenced in this release, please see AM Best’s Recent Rating
Activity web page. For additional information regarding the use and
limitations of Credit Rating opinions, please view Guide to Best's
Credit Ratings. For information on the proper use of Best’s Credit
Ratings, Best’s Performance Assessments, Best’s Preliminary Credit
Assessments and AM Best press releases, please view Guide to Proper
Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and
data analytics provider specializing in the insurance industry.
Headquartered in the United States, the company does business in
over 100 countries with regional offices in London, Amsterdam,
Dubai, Hong Kong, Singapore and Mexico City. For more information,
visit www.ambest.com.
Copyright © 2024 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240202937944/en/
Jennifer Asamoah Senior Financial Analyst +1 908 882
2080 jennifer.asamoah@ambest.com
Christopher Sharkey Associate Director, Public
Relations +1 908 882 2310
christopher.sharkey@ambest.com
Joseph Zazzera Director +1 908 882 2442
joseph.zazzera@ambest.com
Al Slavin Senior Public Relations Specialist +1
908 882 2318 al.slavin@ambest.com
Cigna (NYSE:CI)
Historical Stock Chart
From Apr 2024 to May 2024
Cigna (NYSE:CI)
Historical Stock Chart
From May 2023 to May 2024