
	2020		2019		2018
	(in millions)
Balances at January 1	$	6,004	$	4,862	$	4,668

Less: Reinsurance recoverables	(68)		(95)		(70)
Balances at January 1, net	5,936		4,767		4,598

Incurred related to:
Current year	61,941		54,193		46,385
Prior years	(313)		(336)		(503)
Total incurred	61,628		53,857		45,882
Paid related to:
Current year	(54,003)		(48,421)		(41,736)
Prior years	(5,418)		(4,267)		(3,977)
Total paid	(59,421)		(52,688)		(45,713)

Reinsurance recoverable	—		68		95
Balances at December 31	$	8,143	$	6,004	$	4,862

Amounts incurred related to prior years vary from previously estimated liabilities as the claims ultimately are settled. Negative amounts reported for incurred related to prior years result from claims being ultimately settled for amounts less than originally estimated (favorable development).

As previously discussed, our reserving practice is to consistently recognize the actuarial best estimate of our ultimate liability for claims. Actuarial standards require the use of assumptions based on moderately adverse experience, which generally results in favorable reserve development, or reserves that are considered redundant. We experienced favorable medical claims reserve development related to prior fiscal years of $313 million in 2020, $336 million in 2019, and $503 million in 2018. The table below details our favorable medical claims reserve development related to prior fiscal years by segment for 2020, 2019, and 2018.


	(Favorable) Unfavorable Medical Claims Reserve Development
	2020		2019		2018

Retail Segment	$	(266)	$	(386)	$	(398)
Group and Specialty Segment	(47)		50		(46)
Individual Commercial Segment	—		—		(57)
Other Businesses	—		—		(2)
Total	$	(313)	$	(336)	$	(503)

The medical claims reserve development for 2020, 2019, and 2018 primarily reflects the consistent application of trend and completion factors estimated using an assumption of moderately adverse conditions. Favorable prior period development is primarily attributed to our Medicare Advantage medical business.

The following discussion provides information about incurred and paid claims development for our segments as of December 31, 2020, net of reinsurance, as well as cumulative claim frequency and the total of IBNR included within the net incurred claims amounts. The information about incurred and paid claims development for the years ended December 31, 2019 and 2018 is presented as supplementary information.

Claims frequency is measured as medical fee-for-service claims for each service encounter with a unique provider identification number. Our claims frequency measure includes claims covered by deductibles as well as claims under capitated arrangements. Claim counts may vary based on product mix and the percentage of delegated capitation arrangements.


	2020		2019		2018
	(in millions)
Balances at January 1	$	5,363	$	4,338	$	3,963

Less: Reinsurance recoverables	(68)		(95)		(70)
Balances at January 1, net	5,295		4,243		3,893

Incurred related to:
Current year	56,821		48,983		41,323
Prior years	(266)		(386)		(398)
Total incurred	56,555		48,597		40,925
Paid related to:
Current year	(49,586)		(43,831)		(37,189)
Prior years	(4,836)		(3,714)		(3,386)
Total paid	(54,422)		(47,545)		(40,575)

Reinsurance recoverable	—		68		95
Balances at December 31	$	7,428	$	5,363	$	4,338

At December 31, 2020, benefits payable for our Retail segment included IBNR of approximately $4.7 billion, primarily associated with claims incurred in 2020. The cumulative number of reported claims as of December 31, 2020 was approximately 133.0 million for claims incurred in 2020, 128.8 million for claims incurred in 2019, and 109.9 million for claims incurred in 2018.

The following tables provide information about incurred and paid claims development for the Retail segment as of December 31, 2020, net of reinsurance.


	Incurred Claims, Net of Reinsurance
	For the Years Ended December 31,
Claims Incurred Year	2018 Unaudited		2019 Unaudited		2020
	(in millions)
2018	$	41,323	$	40,984	$	40,946
2019			48,983		48,820
2020					56,821
Total					$	146,587


	Cumulative Paid Claims, Net of Reinsurance
	For the Years Ended December 31,
Claims Incurred Year	2018 Unaudited		2019 Unaudited		2020
	(in millions)
2018	$	37,189	$	40,841	$	40,946
2019			43,831		48,627
2020					49,586
Total					139,159
All outstanding benefit liabilities before 2018, net of reinsurance					N/A
Benefits payable, net of reinsurance					$	7,428

Activity in benefits payable for our Group and Specialty segment, excluding military services, was as follows for the years ended December 31, 2020, 2019 and 2018:


	2020		2019		2018
	(in millions)
Balances at January 1	$	641	$	517	$	568



Incurred related to:
Current year	5,576		5,708		5,466
Prior years	(47)		50		(46)
Total incurred	5,529		5,758		5,420
Paid related to:
Current year	(4,873)		(5,081)		(4,957)
Prior years	(582)		(553)		(514)
Total paid	(5,455)		(5,634)		(5,471)


Balances at December 31	$	715	$	641	$	517

At December 31, 2020, benefits payable for our Group and Specialty segment included IBNR of approximately $594 million, primarily associated with claims incurred in 2020. The cumulative number of reported claims as of December 31, 2020 was approximately 8.6 million for claims incurred in 2020, 10.0 million for claims incurred in 2019, and 10.9 million for claims incurred in 2018.

The following tables provide information about incurred and paid claims development for the Group and Specialty segment as of December 31, 2020, net of reinsurance.


	Incurred Claims, Net of Reinsurance
	For the Years Ended December 31,
Claims Incurred Year	2018 Unaudited		2019 Unaudited		2020
	(in millions)
2018	$	5,466	$	5,501	$	5,505
2019			5,708		5,657
2020					5,576
Total					$	16,738


	Cumulative Paid Claims, Net of Reinsurance
	For the Years Ended December 31,
Claims Incurred Year	2018 Unaudited		2019 Unaudited		2020
	(in millions)
2018	$	4,957	$	5,487	$	5,505
2019			5,081		5,645
2020					4,873
Total					16,023
All outstanding benefit liabilities before 2018, net of reinsurance					N/A
Benefits payable, net of reinsurance					$	715

The reconciliation of the net incurred and paid claims development tables to benefits payable in the consolidated statement of financial position is as follows:


	December 31, 2020
Net outstanding liabilities
Retail	$	7,428
Group and Specialty	715
Benefits payable, net of reinsurance	8,143
Reinsurance recoverable on unpaid claims
Retail	—


Total benefits payable, gross	$	8,143