Cigna Group

Note 12 – 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. The Company expects that the program will continue through 2028 and is continuing to evaluate additional opportunities to improve the overall efficiency and effectiveness of our operations. 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.

During the three and nine months ended September 30, 2026, we reported total costs of $85 million ($62 million after-tax) and $535 million ($405 million after-tax), respectively, associated with this initiative, compared with $222 million ($168 million after-tax) and $566 million ($429 million after-tax), respectively, for the three and nine months ended September 30, 2025.

The total costs for the three and nine months ended September 30, 2026 included $86 million and $532 million, respectively, pre-tax in Selling, general and administrative expenses, which was primarily associated with severance ($61 million and $431 million, respectively). Comparatively, the total costs for the three and nine months ended September 30, 2025 included $181 million and $467 million, respectively, pre-tax in Selling, general and administrative expenses, which was primarily associated with severance ($141 million and $335 million, respectively).

Program-to-date total costs of $1,284 million pre-tax ($970 million after-tax) included $1,148 million in Selling, general and administrative expenses, which were primarily associated with severance ($809 million) and asset impairments ($109 million). The remainder of the total program costs 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 15 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: