Cigna Corp. CI and Oscar Health, Inc. OSCR have come together to offer a health insurance product named Cigna + Oscar to small businesses.
This product will help small businesses provide their employees with access to affordable, member-first health insurance products.
The health insurance product will offer a much-needed boost to small businesses for attracting and retaining employees, especially with a constrained employee benefit budget.
Small businesses across California will be able to provide this health insurance as part of the employee pay package.
Since the outset of the pandemic, businesses all across California have been facing a hard time to keep their business engines going. This in turn dried up finances for small businesses, forcing the same to save on all kinds of possible expenses as top-line growth is difficult to achieve until business conditions normalize and the pandemic subsides.
This product by Cigna and Oscar will address the needs of small businesses to provide health insurance to their employees. A survey by Cigna + Oscar found that 88% of the small businesses surveyed id prioritizing employee health while for 66%, health insurance gained importance in their budgets amid the current scenario than in the pre-pandemic era.
Small businesses in California between one and 100 employees will be able to procure this health insurance services for their employees. It will be a combination of Cigna’s provider relationships and Oscar’s consumer-centric, tech-driven approach to customer service and care navigation.
Small enterprises are a life line for the US economy and contribute significantly to the country’s economic development and job creation. Despite having employees in the sub-100 range, these entities have driven millions of job opportunities over the past few years.
In fact, there are currently 60.6 million small business employees in the United States, which make up approximately half (47.1%) of the US workforce.
Cigna chose California to offer this product as the state has the highest number of small businesses, thus providing the company with a good market size. With 4.1 million small businesses as of 2020, the Golden State is home to nearly 50% as many small businesses as Texas, which comes close second in sustaining small businesses in the United States.
California’s small business employees account for 48.5% of the state’s total employees, which is higher than the national average. Of the total number of new jobs created, nearly 215,000 (around 13.4%) were in California. This clearly shows that there is considerable demand for health insurance product in this region.
Other health insurers present in California providing coverage to small group business are UnitedHealth Group Inc. UNH, Anthem Inc. ANTM and Centene Corp. (CNC) among others.
The stock has gained 35.1% in the past six months compared with the industry’s growth of 9.5%.
Cigna carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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