COVID-19 and Related Economic Impact

3 Months Ended

Mar. 31, 2020

Unusual or Infrequent Items, or Both [Abstract]

COVID-19 and Related Economic Impact

COVID-19 and Related Economic Impact

Following the emergence of the novel strain of coronavirus (COVID-19), Cigna has been actively monitoring all aspects of our business. The effects of the COVID-19 pandemic on the Company began to emerge in the U.S. at the end of the first quarter and were not material to the Company's results of operations or financial condition as of or for the three months ended March 31, 2020. As described below, management has taken a number of steps to assess the impact on our business, including the financial reporting implications associated with this pandemic.

The Company conducted its normal quarterly qualitative assessment of goodwill impairment, and concluded that the current economic and business conditions did not result in a triggering event requiring a quantitative impairment analysis. All other long-lived assets, including intangible assets, were reviewed for impairment and no material impairments were recorded for the three months ended March 31, 2020.

The Company reviewed all classes of financial instruments including investments, accounts receivable and reinsurance recoverables, and recorded an additional allowance for expected credit losses of $55 million related to investments (see Note 11 to the Consolidated Financial Statements) and $13 million related to accounts receivable (see Note 4 to the Consolidated Financial Statements) for the three months ended March 31, 2020. The Company also initiated several actions to assist our customers, clients, health care providers, and employees in this time of crisis. The financial impact of these actions for the three months ended March 31, 2020 was not material.

Additionally, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted on March 27, 2020 in the United States. The impact of this new legislation was not material to the Company's financial results for the three months ended March 31, 2020. The Company did not request any funding under the CARES Act. However, in April 2020 the Company received $41 million from the provider relief fund, all of which has been returned to the U.S. Department of Health and Human Services.