Cigna Group

Note 16 – Strategic Optimization Program

In the first quarter of 2025, the Company commenced an enterprise-wide initiative to evolve our business and deliver a more efficient and improved experience for our patients, providers and customers. At commencement, this program was expected to continue through December 2026; however, the Company is continuing to evaluate additional opportunities and expects that the program will continue through 2028. The program includes severance and other employee costs, asset impairments and accelerated asset amortization, and the operating results of certain small non-strategic businesses that we plan to discontinue. As we continue to evaluate additional opportunities to improve the overall efficiency and effectiveness of our operations, we anticipate future charges.

During the year ended December 31, 2025, we reported total costs of $749 million pre-tax ($565 million after-tax) associated with this initiative. The total costs included $616 million, pre-tax in Selling, general and administrative expenses which were primarily associated with severance ($378 million) and asset impairments ($101 million). The remainder reflects the operating results of certain non-strategic businesses. We expect substantially all of the accrued liability to be paid by the end of 2026. See Note 23 to the Consolidated Financial Statements for further details of the strategic optimization program by segment.

The following table presents a roll forward of the accrued liability recorded in Accrued expenses and other liabilities during the year ended December 31, 2025: