3 Min Read
NEW YORK (Reuters) - Cigna Corp (CI.N), which recently won court approval to break off its failed deal with Anthem Inc (ANTM.N), on Thursday said it would give its more than 40,000 employees five Cigna shares each and expand its paid leave, as it embarks on its next phase of growth.
"It's meant to be a reinforcement of all of us as owners," Cigna Chief Executive Officer David Cordani said in an interview. Cigna shares were trading near a 52-week high at about $163.24 on Thursday.
Cordani said that the benefit awards, which amount to $35 million to $40 million, come as the company moves to the next phase of its growth strategy. He said the company has grown its employee base by 10 percent over the last year.
Cigna, which sells commercial health insurance in the U.S. and overseas and provides U.S. government-paid plans, agreed to be bought by Anthem nearly two years ago. After the U.S. Justice Department sued to stop that deal last summer, it disagreed with Anthem on pushing forward and has spent the past year in court battles.
Cigna and Anthem are still in court over the $1.8 billion break-up fee that Cigna says it is entitled to. Anthem is fighting the payout.
Cigna said it plans to extend paid paternity and adoption leave to four weeks and offer up to four weeks of paid leave for employees caring for others including to support child bonding and ill family members.
Cordani said Cigna also is starting a sabbatical program in which 12 employees a year can receive a paid one-to-three month fellowship and up to a $20,000 stipend to support a community work project.
Cigna said that the post-Anthem path forward involves growing its existing businesses, which include government paid plans such as Medicare Advantage and drug benefits for older people, and its primary business of managing benefits for corporations both in the United States and overseas.
The company also has more than 350,000 members in individual health plans. Plans that comply with the terms set out by the Affordable Care Act, often called Obamacare, account for most of those. Cordani said the company is still deciding how it will proceed regarding selling Obamacare plans in 2018. Currently, it sells those plans in seven states.
Insurers are trying to design plans and price premiums for 2018, but generally say it is difficult because Republicans have vowed to repeal and replace the law but have not agreed on how to do so or how to manage the years of transition until new laws are passed.
Reporting by Caroline Humer; Editing by Bernard Orr