New Cigna Corp. CEO David Cordani started his tenure Monday focused on overseas business as a key to maintaining the managed care company's improved financial performance.
Cordani, 43, replaces retiring Chairman and CEO H. Edward Hanway as the Philadelphia insurer's top executive in a move that was announced last June, along with the promotion of Isaiah "Ike" Harris Jr. to non-executive chairman.
A Connecticut native, Cordani is a certified public accountant with a master's degree in business administration from the University of Hartford. He joined Cigna in 1991 and became president and chief operating officer in June 2008. Analysts have said his promotion to CEO was widely anticipated.
The 43-year-old takes over a company that earned $972 million through the first three quarters of 2009. It also saw its stock price soar 98 percent last year even though Cigna and other health insurers faced slumping enrollment during the recession and the uncertainty caused by a possible U.S. health care system overhaul.
Cordani said in a telephone interview Monday that the company's top goal "by far and away is to grow the corporation on a global footprint."
"A big part of our growth strategy is outside the United States," he said.
Cigna operates health care, group disability and life segments in the United States. It also sells individual insurance in several countries and operates an expatriate business that provides coverage for people living outside their home countries.
Cordani said expanding economies in countries like Indonesia and China are creating a rapidly growing middle-class market for health, accident, life, disability and dental coverage.
Cigna and other health insurers saw their U.S. enrollments tumble last year, as the recession forced companies to cut jobs and trim the number of people covered by employer-sponsored insurance. Company leaders said in the fall that they expect that to stabilize this year.
Cordani said Monday the company also expects growth in the U.S. market for its disability insurance and in plans where it provides only administrative services _ and not insurance _ for companies with between 51 and 250 employees.
Health insurance stocks rose and fell several times last year as Congress debated measures to cover the uninsured and reduce health care costs. That debate is expected to conclude early this year, but analysts have said Cigna is largely insulated from reform measures because it doesn't sell a large number of individual insurance or Medicare Advantage policies.
Medicare Advantage plans are targeted for funding cuts, and analysts say individual insurance market rule changes like a requirement that insurers cover everyone who applies will make those products less profitable.
Even so, Cigna has expanded its product portfolio and is positioned to gain some business because of that, said Cordani. The insurer offers services to help manage chronic care and wellness programs like health coaching to help improve employee productivity.
Cordani noted that some employers may eventually opt out of providing primary health coverage if a reform measure makes it out of Congress. In that case, they would still need some of Cigna's other services.
"We are well positioned with those capabilities," he said.
Cigna shares rose 3 percent to close at $36.37 Monday, but declined 31 cents in aftermarket trading.