Cigna Corporation (CI - Free Report) recently welcomed back Dignity Health to its vast network after both the healthcare providers finally agreed on a new agreement. Notably, Dignity Health, which offers a diversified network of high quality and patient-centered services, primarily caters to health needs in Arizona, California, and Nevada.
The multi-year agreement, being effective from Jul 1, 2020, will benefit Cigna customers across California and Nevada. They will be able to avail affordable healthcare services provided by Dignity Health.
This agreement was reached after renewed negotiations and a long haul of nine months. It is to be noted that most of Cigna’s Nevada customers could not avail Dignity Health’s services from December 2019 after both the companies failed to come to an agreement last year. Following this, Dignity Health also became out-of-network for most of Cigna's California customers in January 2020.
Coming back to the latest move, this agreement lays the groundwork on which both Cigna and Dignity Health will continue to work together, thus, bringing about improved health outcomes in California and Nevada. Notably, both the companies have been doing the same since 1990s.
We also believe that this new agreement between the two healthcare providers is likely to provide relief to people across both the states, as the entirety of the United States is grappling with the ongoing COVID-19 pandemic.
Shares of this Zacks Rank #3 (Hold) healthcare provider have gained 18.2% in a year compared with the industry’s growth of 25.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Notable Tie-ups and Contract Extensions
It is worth mentioning that Cigna has extended contracts with several healthcare systems for providing uninterrupted healthcare services across several regions of the United States. Case in point, it extended agreements with both UPMC Pinnacle and Memorial Hermann in July, by virtue of which Cigna clients will have continued access to both the healthcare systems.
The healthcare provider has also teamed up with several healthcare systems for bolstering its partner networks. To this effect, Cigna has collaborated with both Priority Health and Huntsville Hospital in June. One month prior to that, it collaborated with MultiCare and Banner Health. Cigna’s agreements with Parkview Health, Houston Methodist and Crozer-Keystone Health System are some other notable ones made this year.
These initiatives not only help the company in providing enhanced healthcare services to customers in dire need of the same but also help in establishing strong presence across the United States.
Moreover, Cigna has been making every effort to expand its telehealth services suite, which has been witnessing a surge in demand triggered by the pandemic. This is likely to position the healthcare provider well for long-term growth.
Among other stocks in the medical space, Teladoc Health Inc. (TDOC - Free Report) , is a niche player in the telehealth service industry with wide offerings and international reach. Other companies, namely Magellan Health, Inc. (MGLN - Free Report) and Humana Inc. (HUM - Free Report) , have also developed telehealth services.
Lastly, Cigna’s diversified product portfolio and vast agent network has led to a rise in the company’s membership for the last many quarters. All these factors have jointly contributed to its revenues, which have been witnessing consistent growth since 2010 and the momentum continued in the first half of 2020 as well.
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