Mergers, Acquisitions and Divestitures

12 Months Ended

Dec. 31, 2021

Business Combination and Asset Acquisition [Abstract]

Mergers, Acquisitions and DivestituresAcquisition of MDLIVE

On April 19, 2021, Cigna acquired 97% of MDLIVE, Inc. ("MDLIVE"), a 24/7 virtual care platform. Combined with Cigna's previously held equity investment, Cigna now owns 100% of MDLIVE. The acquisition of MDLIVE will enable Cigna's Evernorth segment to continue expanding access to virtual care and delivering a more affordable, convenient and connected care experience for consumers.

The purchase price of $2.0 billion consisted of cash consideration. In accordance with GAAP, the total consideration transferred has been allocated to the tangible and intangible net assets acquired based on management's preliminary estimates of their fair values and may change as additional information becomes available over the next several months. As of December 31, 2021, the Company made immaterial measurement period adjustments to the purchase price allocation. The estimated fair values of assets acquired and liabilities assumed as of the closing date were as follows:


(In millions)
Goodwill	$	1,438
Acquired intangible assets	627
Tangible assets acquired net of liabilities assumed	17
Total consideration transferred	2,082
Less: Fair value to Cigna's previously held equity interest	(55)
Total purchase price	$	2,027

Substantially all of the goodwill is assigned to the Evernorth segment ($1.3 billion). Goodwill is not deductible for federal income tax purposes. The acquired intangible assets primarily consist of customer relationships ($577 million) as well as internal-use software, provider networks and a trade name. The fair value of the customer relationships and the amortization period were determined using an income approach that relies heavily on projected future net cash flows including key assumptions for customer attrition, margins and discount rates. The customer relationship intangible asset is amortized over a period of 17 years in a pattern that reflects when Cigna expects to receive the benefits of the related cash flows.

The results of MDLIVE have been included in the Company's Consolidated Financial Statements from the date of the acquisition. Revenues from MDLIVE and their results of operations were not material to Cigna's consolidated results of operations for the year ended December 31, 2021. The pro forma effects of this acquisition for current and prior periods were not material to our consolidated results of operations.

Divestiture of U.S. Group Disability and Life businessOn December 31, 2020, Cigna completed the sale of its U.S. Group Disability and Life business to New York Life Insurance Company for cash proceeds of $6.2 billion. The Company recognized a gain of $4.2 billion pre-tax ($3.2 billion after-tax), which included recognition of previously unrealized capital gains on investments sold (see Note 14 for further information).Integration and Transaction-related CostsIn 2021, the Company incurred costs related to the acquisition of MDLIVE, the sale of the U.S. Group Disability and Life business, the terminated merger with Anthem, Inc. ("Anthem") and the pending Chubb Transaction (see Note 5 for further information on assets and liabilities of businesses held for sale). In 2020 and 2019, the Company incurred costs related to the acquisition and integration of Express Scripts Holding Company ("Express Scripts"), the terminated merger with Anthem, the sale of the U.S. Group Disability and Life insurance business and other transactions. These costs were $169 million pre-tax ($71 million after-tax) for the year ended December 31, 2021, compared with $527 million pre-tax ($404 million after-tax) for the year ended December 31, 2020 and $552 million pre-tax ($427 million after-tax) for the year ended December 31, 2019. These costs consisted primarily of certain projects to integrate or separate the Company's systems, products and services, fees for legal, advisory and other professional services and certain employment-related costs. After-tax costs for the year ended December 31, 2021 included a tax benefit from the resolution of a tax matter related to the sold Group Disability and Life business.