Chairman of the Board, CEO at The Cigna Group
Thanks, Ralph. Good morning, everyone, and thank you for joining today's call. Our team is performing well in a dynamic environment, and we delivered another strong quarter of revenue, earnings and cash flows. I'm going to spend a few minutes highlighting key drivers of our results in the third quarter and while we are once again raising our 2022 full year outlook for adjusted earnings per share as well as for growth in medical customers and enterprise revenues. Then I'll address how we continue to expand and enhance our capabilities for the evolving market needs, and I'll also provide some initial perspective relative to 2023. Brian will share more details about our third quarter results and our outlook for the rest of the year. Then we'll take your questions.
With that, let's get started. During the third quarter, we delivered results that were better than our expectations, including total revenues of $45.3 billion, and adjusted earnings per share of $6.04. We continued building out our momentum this year, and we are confident we will deliver on our increased full year 2022 adjusted EPS guidance of at least $23.10. We also expect to continue advancing our capital deployment strategy, including investing in our business to drive innovation and growth and repurchasing at least $7 billion of our shares this year, all while paying a meaningful dividend. Our performance in the quarter reinforces the impact of our sustained commitment to service and innovation, our progress in retaining clients and expanding relationships with additional services as well as winning new business.
Evernorth, our health service platform performed well again with solid top line and bottom line results driven by our market-leading innovation and affordability across our pharmacy benefit services, specialty pharmacy and Evernorth Care Solutions. Cigna Healthcare, our benefits portfolio also was key to continuing our momentum in the quarter. Our U.S. commercial business is having a very good year with solid client retention levels and new business wins, particularly in the middle market and select segments, leading us to once again raise our full year outlook for medical customers. Our medical care ratio for Cigna Healthcare was better than expectations at 80.8% in the third quarter demonstrating the effectiveness of our affordability initiatives and targeted pricing actions. Overall, we're very pleased with the third quarter results.
Now I'll take a few minutes to walk through how we are well positioned going forward with Evernorth and Cigna Healthcare. Within both platforms, we have differentiated businesses and a clear, durable three-part growth framework. First, through our foundational businesses, including our pharmacy benefit services, U.S. commercial and international health businesses. With these mature scale businesses, we established core relationships with corporate clients, health plans and governmental entities. Our capital-efficient operating models will further support steady growth as well as strategic and financial flexibility for our company. As we look ahead for these businesses, in 2023, pharmacy benefit services, we're expecting another year of high client retention levels complemented with new business wins.
We're also very pleased with our solid start to the selling season for 2024, including our new multiyear agreement for Express Scripts to be the pharmacy benefits and specialty services provider for Centene.
Working with Centene, we will make prescription drugs more affordable and accessible for approximately 20 million Centene members. The strategic collaboration with Centene builds on Express Scripts' track record as a partner of choice and will present growth opportunities to provide additional Evernorth Health services over time. We continue showing how we have a unique ability to partner across the health care landscape, expanding our reach and impact to more customers and patients, and with this new health plan relationship, we are building on our previous collaborations such as Prime Therapeutics, Oscar and Kaiser Permanente.
For U.S. commercial, we are driving strong customer growth with wins throughout 2022, and enabled by our consultative sales approach and our affordability gains, enhancing more competitiveness in more geographies, all while maintaining ongoing pricing discipline. The sales and net growth in our National Accounts segment are solid and outpaced prior year results, and we are confident this momentum carries into 2023. And in international health, we are sharpening our health care focus for targeted growth opportunities in serving individuals, employers seeking healthy and productive employees and governmental entities that value our care management programs. We have momentum this year in customer growth, revenue and earnings and expect to sustain these results and performance throughout 2023.
The second way we drive growth is through our Accelerate businesses, which include Accredo Specialty Pharmacy, Evernorth Care Services and our U.S. government business. These businesses have outsized opportunities to grow with compelling secular tailwinds and as well as differentiated capabilities that benefit our clients and customers. Looking forward for our Accelerate businesses, we continue to be excited about the value creation opportunities in specialty pharmaceuticals, including biosimilars over the next several years. With our leading capabilities and expertise, we expanded our relationship to be the exclusive specialty pharmacy provider for the Department of Defense starting in 2023. This is further reinforcement to how we fuel sustained long-term growth in Evernorth by improving clinical quality for the benefit of patients and achieving significant savings for our clients.
In Evernorth Care Services, we are advancing our care management and delivery strategies. One area of focus is enhancing virtual care that strengthens relationships between patients and their physicians to better anticipate health issues and intervene earlier. For example, with MDLIVE, we are providing better experiences and improved affordability with personalized care that is more convenient and effective in directing patients to the most appropriate care settings. When a person -- when in-person care is needed, MDLIVE successfully guide patients to urgent care facilities or other alternative sites to care, decreasing avoidable emergency room visits by at least 10%. We intend to further build on this progress by enhancing our virtual primary care offerings for patients with chronic conditions by providing continuous engagement with their physician, remote monitoring with connected devices and real-time interventions between appointments.
In U.S. government, we are continuing to make investments, positioning us to grow in 2023 and beyond. We are strengthening this business by building on our high-quality affordable Medicare Advantage benefits we offer with geographic and network expansion as well as further product enhancements.
Finally, the third way we drive growth is through a cross enterprise leverage Here, we harness capabilities across our company to accelerate innovation and have a greater impact than any individual could have on its own. Our opportunities here are driven in part by a rich longitudinal data and information we have to accelerate the development of new, more effective solutions for our clients and customers.
Our Pathwell programs are a good example. With Pathwell Specialty, we're working across the medical and pharmacy benefits to reduce the cost of specialty infusions and injectables. In our Pathwell Bone and Joint program, we harness Evernorth digital navigation and advanced predictive analytical capabilities to reduce unnecessary musculoskeletal surgeries and provide better coordinated care. There is a significant addressable market for these programs as 50% of adults suffer from bone, joint and muscle conditions, and these are major drivers to U.S. health care costs.
Additionally, we continue to take an enterprise view of our client relationships and successfully broaden and deepen them with our overall suite of capabilities. This has supported a number of attractive wins and a good example is a very large new fee-based relationship for 2023 in our U.S. commercial team that has secured this offering by bringing a solution to a long-standing Express Scripts client.
With our Evernorth and Cigna Healthcare platforms and our growth framework, we anticipate driving another year of earnings, customer and revenue growth in 2023. We will provide detailed guidance as we always do on our fourth quarter earnings call.
Having said that, I'll provide a view of some of the tailwinds and headwinds we see for 2023, which are largely consistent with the points we highlighted at our Investor Day in June. With a strong selling season, we anticipate a tailwind of continued growth across both our Evernorth and Cigna Healthcare platforms. We expect additional margin improvement in Cigna Healthcare and with our leading position in the rapidly growing specialty pharmaceuticals market will begin capturing value from biosimilars. Relative to anticipated headwinds, we will make meaningful strategic investments in our accelerated growth businesses. We will have additional costs as well as we prepare to support renewed and expanded relationships with the Department of Defense and Prime Therapeutics.
And a new development since Investor Day is our exciting strategic win with Centene, which will create a 1-year headwind as we onboard this new partner. Putting all that together, we anticipate that these tailwinds and headwinds will largely balance themselves off next year with the exception of our Centene headwind, which represents incremental cost for us in 2023.
Now I'll briefly summarize. Overall, our strong performance in the quarter and throughout the year shows how we are addressing the most pressing needs of our customers and clients and growing our business. We're investing in innovation to enhance our capabilities for future growth and continue delivering for all of our stakeholders. We're confident we remain on track for our full year 2022 commitments, including our increased adjusted EPS guidance for this year of at least $23.10.
And with that, I'll turn the call over to Brian.