
	2021		2020		2019
	(in millions)
Balances at January 1	$	8,143	$	6,004	$	4,862

Less: Reinsurance recoverables	—		(68)		(95)
Balances at January 1, net	8,143		5,936		4,767
Acquisitions	42		—		—
Incurred related to:
Current year	70,024		61,941		54,193
Prior years	(825)		(313)		(336)
Total incurred	69,199		61,628		53,857
Paid related to:
Current year	(62,149)		(54,003)		(48,421)
Prior years	(6,946)		(5,418)		(4,267)
Total paid	(69,095)		(59,421)		(52,688)

Reinsurance recoverable	—		—		68
Balances at December 31	$	8,289	$	8,143	$	6,004

Amounts incurred related to prior years vary from previously estimated liabilities as the claims ultimately are settled. Negative amounts reported for incurred related to prior years result from claims being ultimately settled for amounts less than originally estimated (favorable development).

As previously discussed, our reserving practice is to consistently recognize the actuarial best estimate of our ultimate liability for claims. Actuarial standards require the use of assumptions based on moderately adverse experience, which generally results in favorable reserve development, or reserves that are considered redundant. We experienced favorable medical claims reserve development related to prior fiscal years of $825 million in 2021, $313 million in 2020, and $336 million in 2019. The table below details our favorable medical claims reserve development related to prior fiscal years by segment for 2021, 2020, and 2019.


	(Favorable) Unfavorable Medical Claims Reserve Development
	2021		2020		2019
	(in millions)
Retail Segment	$	(729)	$	(266)	$	(386)
Group and Specialty Segment	(96)		(47)		50


Total	$	(825)	$	(313)	$	(336)

The medical claims reserve development for 2021, 2020, and 2019 primarily reflects the consistent application of trend and completion factors estimated using an assumption of moderately adverse conditions. In addition, the higher prior year favorable development for the year ended December 31, 2021 was primarily attributable to the reversal of actions taken in 2020, including the suspension of certain financial recovery programs for a period of time impacting our claim payment patterns. The suspension during 2020 was intended to provide financial and administrative relief for providers facing unprecedented strain as a result of the COVID-19 pandemic.

The following discussion provides information about incurred and paid claims development for our segments as of December 31, 2021, net of reinsurance, as well as cumulative claim frequency and the total of IBNR included

within the net incurred claims amounts. The information about incurred and paid claims development for the years ended December 31, 2020 and 2019 is presented as supplementary information.

Claims frequency is measured as medical fee-for-service claims for each service encounter with a unique provider identification number. Our claims frequency measure includes claims covered by deductibles as well as claims under capitated arrangements. Claim counts may vary based on product mix and the percentage of delegated capitation arrangements.


	2021		2020		2019
	(in millions)
Balances at January 1	$	7,428	$	5,363	$	4,338

Less: Reinsurance recoverables	—		(68)		(95)
Balances at January 1, net	7,428		5,295		4,243
Acquisitions	42		—		—
Incurred related to:
Current year	65,636		56,821		48,983
Prior years	(729)		(266)		(386)
Total incurred	64,907		56,555		48,597
Paid related to:
Current year	(58,363)		(49,586)		(43,831)
Prior years	(6,339)		(4,836)		(3,714)
Total paid	(64,702)		(54,422)		(47,545)

Reinsurance recoverable	—		—		68
Balances at December 31	$	7,675	$	7,428	$	5,363

At December 31, 2021, benefits payable for our Retail segment included IBNR of approximately $5.2 billion, primarily associated with claims incurred in 2021. The cumulative number of reported claims as of December 31, 2021 was approximately 156.1 million for claims incurred in 2021, 140.4 million for claims incurred in 2020, and 129.1 million for claims incurred in 2019.

The following tables provide information about incurred and paid claims development for the Retail segment as of December 31, 2021, net of reinsurance.


	Incurred Claims, Net of Reinsurance
	For the Years Ended December 31,
Claims Incurred Year	2019 Unaudited		2020 Unaudited		2021
	(in millions)
2019	$	48,983	$	48,820	$	48,713
2020			56,821		56,223
2021					65,678
Total					$	170,614


	Cumulative Paid Claims, Net of Reinsurance
	For the Years Ended December 31,
Claims Incurred Year	2019 Unaudited		2020 Unaudited		2021
	(in millions)
2019	$	43,831	$	48,627	$	48,713
2020			49,586		55,863
2021					58,363
Total					162,939
All outstanding benefit liabilities before 2019, net of reinsurance					N/A
Benefits payable, net of reinsurance					$	7,675

Activity in benefits payable for our Group and Specialty segment, excluding military services, was as follows for the years ended December 31, 2021, 2020 and 2019:


	2021		2020		2019
	(in millions)
Balances at January 1	$	715	$	641	$	517



Incurred related to:
Current year	5,047		5,576		5,708
Prior years	(96)		(47)		50
Total incurred	4,951		5,529		5,758
Paid related to:
Current year	(4,445)		(4,873)		(5,081)
Prior years	(607)		(582)		(553)
Total paid	(5,052)		(5,455)		(5,634)


Balances at December 31	$	614	$	715	$	641

At December 31, 2021, benefits payable for our Group and Specialty segment included IBNR of approximately $532 million, primarily associated with claims incurred in 2021. The cumulative number of reported claims as of December 31, 2021 was approximately 8.3 million for claims incurred in 2021, 9.1 million for claims incurred in 2020, and 10.1 million for claims incurred in 2019.

The following tables provide information about incurred and paid claims development for the Group and Specialty segment as of December 31, 2021, net of reinsurance.


	Incurred Claims, Net of Reinsurance
	For the Years Ended December 31,
Claims Incurred Year	2019 Unaudited		2020 Unaudited		2021
	(in millions)
2019	$	5,708	$	5,657	$	5,652
2020			5,576		5,491
2021					5,047
Total					$	16,190


	Cumulative Paid Claims, Net of Reinsurance
	For the Years Ended December 31,
Claims Incurred Year	2019 Unaudited		2020 Unaudited		2021
	(in millions)
2019	$	5,081	$	5,465	$	5,652
2020			4,873		5,479
2021					4,445
Total					15,576
All outstanding benefit liabilities before 2019, net of reinsurance					N/A
Benefits payable, net of reinsurance					$	614