Financial ratings provider A.M. Best has upgraded its outlook on Cigna, many of its subsidiaries and $5.15 billion of the Bloomfield insurer’s debt from ‘stable’ to’ positive.’
The revision indicates that over the next one to three years, A.M. Best may upgrade Cigna’s issuer credit rating, which remains at ‘bbb’ — the lower end of investment grade.
A.M. Best also upgraded 33 Cigna subsidiaries to ‘positive’ and affirmed their ratings.
A.M. Best said the revision reflects its opinion that Cigna has successfully navigated through initial market changes brought on by the Affordable Care Act.
But it said ACA fees have brought pressure on Cigna’s earnings, as well as increased competition and lower reimbursement levels in its Medicare Advantage business.
Cigna’s individual exchange business also posted unfavorable results last year, Best said.
