Molina Healthcare, Inc. (NYSE: MOH):
-
Adjusted net income per diluted share, continuing operations,1
of $0.71.
-
Net income per diluted share, continuing operations, of $0.16.
-
Aggregate membership grew by 22% compared with second quarter of 2013.
-
Total revenue of $2.3 billion, up 12% compared with first quarter of
2014; and up 44% compared with second quarter of 2013.
-
General and administrative expense ratio declined sequentially to 8.4%
in the second quarter of 2014, from 9.1% in the first quarter of 2014.
-
Began serving members under fully integrated dual eligible pilot
programs in California, Illinois and Ohio during the second quarter of
2014.
Molina Healthcare, Inc. (NYSE: MOH) today reported its financial results
for the second quarter of 2014.
“We are pleased that 2014 is unfolding as we anticipated,” said J. Mario
Molina, M.D., chief executive officer of Molina Healthcare, Inc. “As we
have stated in the past, the three key elements that remain critical to
our success during the remainder of 2014 have not changed. These include
revenue growth from new programs such as Medicaid expansion and the dual
eligible Medicare Medicaid plans; the delivery of cost effective care to
our chronically ill members, including the dual eligible; and the
realization of administrative cost efficiencies. So far, 2014 has been a
success in all three areas. Of course, we have much work left to do in
2014. Many factors outside of our direct control, such as the
reimbursement of the Affordable Care Act’s Health Insurer Fee, are still
not resolved. But we remain confident in the prospects for our company
and take satisfaction from our progress this year.”
Overview of Financial Results, Continuing Operations
The Company previously reported that its first quarter results were
adversely affected by delays in securing agreements for the
reimbursement (including reimbursement for tax effect) of the Affordable
Care Act’s Health Insurer Fee (ACA HIF) and delays in the recognition of
quality related revenue. Those circumstances continued through the end
of the second quarter of 2014.
Net income reported for the second quarter of 2014 and the six months
ended June 30, 2014, would have been higher except for:
-
ACA HIF not reimbursed by the Company’s state partners reduced
earnings approximately $16 million, or $0.14 per diluted share, for
the second quarter and $32 million, or $0.29 per diluted share, for
the six months ended June 30, 2014 (per-share amounts for both periods
on a GAAP and adjusted basis). The Company remains guardedly
optimistic that it will secure reimbursement agreements with all of
its state partners prior to the close of 2014.
-
The Company’s non-recognition of a portion of the Texas health plan’s
quality incentive program reduced earnings approximately $7 million,
or $0.06 per diluted share, for the second quarter and $13 million, or
$0.12 per diluted share, for the six months ended June 30, 2014
(per-share amounts for both periods on a GAAP and adjusted basis). The
Company remains guardedly optimistic that it will be able to recognize
most of its quality revenue in Texas prior to the close of 2014.
Second Quarter of 2014 Compared with the Second Quarter of 2013
The Company believes that the following items are of significance when
comparing financial results from continuing operations for the second
quarter of 2014 with the second quarter of 2013:
-
Thus far in 2014, certain of the Company’s state partners have failed
to reimburse it for the ACA HIF reduced revenue, representing
approximately $16 million in the second quarter of 2014;
-
Approximately $7 million of quality revenue was not recognized by the
Company’s Texas health plan in the second quarter of 2014;
-
The non-deductibility of ACA HIF resulted in a much higher effective
tax rate in the second quarter of 2014 than in the second quarter of
2013; and
-
A non-cash charge of approximately $4 million was recorded in the
second quarter of 2013 in connection with the Company’s convertible
senior notes offering in February 2013.
Net Income Per Share Guidance
The Company’s guidance for fiscal year 2014 remains unchanged and is as
follows:
|
|
|
|
Low End
|
|
|
|
High End
|
Net income per diluted share, continuing operations
|
|
|
|
$
|
1.65
|
|
|
|
$
|
2.15
|
|
|
|
|
|
|
|
|
|
Adjusted net income per diluted share, continuing operations
|
|
|
|
$
|
4.00
|
|
|
|
$
|
4.50
|
|
|
|
|
|
|
|
|
|
As previously stated, the underlying assumptions for fiscal year 2014
guidance include full reimbursement of ACA HIF and receipt of the Texas
Health plan’s quality incentive program revenue, and exclude the effect
of hepatitis C drugs such as Sovaldi.
Conference Call
The Company’s management will host a conference call and webcast to
discuss its second quarter results at 5:00 p.m. Eastern time on
Wednesday, July 30, 2014. The number to call for the interactive
teleconference is (212) 231-2936. A telephonic replay of the conference
call will be available from 7:00 p.m. Eastern time on Wednesday,
July 30, 2014, through 6:00 p.m. on Thursday, July 31, 2014, by dialing
(800) 633-8284 and entering confirmation number 21721183. A live
broadcast of Molina Healthcare’s conference call will be available on
the Company’s website, www.molinahealthcare.com.
A 30-day online replay will be available approximately an hour following
the conclusion of the live broadcast.
About Molina Healthcare
Molina Healthcare, Inc., a FORTUNE 500 company, provides managed health
care services under the Medicaid and Medicare programs and through the
state insurance marketplaces. Through our locally operated health plans
in 11 states across the nation, Molina currently serves approximately
2.3 million members. Dr. C. David Molina founded our company in 1980 as
a provider organization serving low-income families in Southern
California. Today, we continue his mission of providing high quality and
cost-effective health care to those who need it most. For more
information about Molina Healthcare, please visit our website at www.molinahealthcare.com.
Notes:
-
Adjusted net income per diluted share, continuing operations, is a
non-GAAP financial measure used by management as a supplemental metric
in evaluating its financial performance, its financing and business
decisions, and in forecasting and planning for future periods. This
measure is not determined in accordance with accounting principles
generally accepted in the United States of America (GAAP) and should
not be viewed as a substitute for the most directly comparable GAAP
measure, which is diluted net income per share, continuing operations.
See below for reconciliations of the Company’s non-GAAP measures to
the most directly comparable GAAP measures.
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995: This earnings release contains “forward-looking
statements” regarding the Company’s plans, expectations, and anticipated
future events. Actual results could differ materially due to
numerous known and unknown risks and uncertainties. Those known
risks and uncertainties include, but are not limited to, the following:
-
uncertainties associated with the implementation of the Affordable
Care Act, including the full grossed up reimbursement by states of the
non-deductible health insurer fee, the expansion of Medicaid
eligibility in the states that participate to previously uninsured
populations unfamiliar with managed care, the implementation of state
insurance marketplaces, the effect of various implementing
regulations, and uncertainties regarding the impact of other federal
or state health care and insurance reform measures, including the dual
eligibles demonstration programs in California, Illinois, Michigan,
Ohio, and South Carolina;
-
newly FDA-approved drugs such as Sovaldi, Olysio, and other drugs
for hepatitis C or other medical conditions that are exorbitantly
priced but not factored into the calculation of our capitated rates
for 2014;
-
significant budget pressures on state governments and their
potential inability to maintain current rates, to implement expected
rate increases, or to maintain existing benefit packages or membership
eligibility thresholds or criteria;
-
management of our medical costs, including seasonal flu patterns
and rates of utilization that are consistent with our expectations,
and our ability to reduce over time the high medical costs commonly
associated with new patient populations;
-
the accurate estimation of incurred but not paid medical costs
across our health plans;
-
retroactive adjustments to premium revenue or accounting estimates
which require adjustment based upon subsequent developments, including
Medicaid pharmaceutical rebates or retroactive premium rate increases;
-
efforts by states to recoup previously paid amounts, including
claims by the Washington Health Care Authority (HCA) that it overpaid
our Washington health plan for certain claims related to psychotropic
drugs and the Washington Community Options Program Entry System
(COPES);
-
the success of our efforts to retain existing government contracts
and to obtain new government contracts in connection with state
requests for proposals (RFPs) in both existing and new states,
including the success of the proposal of Molina Medicaid Solutions in
New Jersey;
-
the continuation and renewal of the government contracts of both
our health plans and Molina Medicaid Solutions and the terms under
which such contracts are renewed, including the extension of the
Louisiana contract of Molina Medicaid Solutions through 2015;
-
government audits and reviews, and any fine, enrollment freeze, or
monitoring program that may result therefrom;
-
changes with respect to our provider contracts and the loss of
providers;
-
federal or state medical cost expenditure floors, administrative
cost and profit ceilings, and profit sharing arrangements;
-
the interpretation and implementation of at-risk premium rules
regarding the achievement of certain quality measures, including 2014
at-risk premium rules in the state of Texas;
-
approval by state regulators of dividends and distributions by our
health plan subsidiaries;
-
changes in funding under our contracts as a result of regulatory
changes, programmatic adjustments, or other reforms;
-
high dollar claims related to catastrophic illness;
-
the favorable or unfavorable resolution of litigation, arbitration,
or administrative proceedings, including the litigation commenced
against us by the state of Louisiana alleging that Molina Medicaid
Solutions and its predecessors used an incorrect reimbursement formula
for the payment of pharmaceutical claims;
-
the relatively small number of states in which we operate health
plans;
-
our management of a portion of College Health Enterprises’ hospital
in Long Beach, California;
-
the availability of adequate financing on acceptable terms to fund
and capitalize our expansion and growth, repay our outstanding
indebtedness at maturity and meet our liquidity needs, including the
interest expense and other costs associated with such financing;
-
the failure of a state in which we operate to renew its federal
Medicaid waiver;
-
an inadvertent unauthorized disclosure of protected health
information;
-
changes generally affecting the managed care or Medicaid management
information systems industries;
-
increases in government surcharges, taxes, and assessments;
-
changes in general economic conditions, including unemployment
rates;
-
increasing consolidation in the Medicaid industry;
and
numerous other risk factors, including those discussed in the
Company’s periodic reports and filings with the Securities and
Exchange Commission. These reports can be accessed under the
investor relations tab of the Company’s website or on the SEC’s
website at www.sec.gov.
Given these risks and uncertainties, we can give no assurances that
the Company’s forward-looking statements will prove to be accurate, or
that any other results or events projected or contemplated by the
Company’s forward-looking statements will in fact occur, and we
caution investors not to place undue reliance on these statements. All
forward-looking statements in this release represent the Company’s
judgment as of July 30, 2014, and we disclaim any obligation to update
any forward-looking statements to conform the statement to actual
results or changes in the Company’s expectations.
|
|
|
MOLINA HEALTHCARE, INC. UNAUDITED CONSOLIDATED
STATEMENTS OF INCOME
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
(Amounts in thousands, except net income per share)
|
Revenue:
|
|
|
|
|
|
|
|
|
Premium revenue
|
|
$
|
2,167,142
|
|
|
$
|
1,501,729
|
|
|
$
|
4,107,479
|
|
|
$
|
2,999,162
|
|
Service revenue
|
|
|
50,232
|
|
|
|
49,672
|
|
|
|
103,862
|
|
|
|
99,428
|
|
Premium tax revenue
|
|
|
70,120
|
|
|
|
46,883
|
|
|
|
121,813
|
|
|
|
83,883
|
|
Health insurer fee revenue (1)
|
|
|
19,662
|
|
|
|
–
|
|
|
|
38,358
|
|
|
|
–
|
|
Investment income
|
|
|
1,945
|
|
|
|
1,628
|
|
|
|
3,574
|
|
|
|
3,144
|
|
Other revenue
|
|
|
2,938
|
|
|
|
5,922
|
|
|
|
6,196
|
|
|
|
10,616
|
|
Total revenue
|
|
|
2,312,039
|
|
|
|
1,605,834
|
|
|
|
4,381,282
|
|
|
|
3,196,233
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Medical care costs
|
|
|
1,934,299
|
|
|
|
1,294,706
|
|
|
|
3,655,957
|
|
|
|
2,582,621
|
|
Cost of service revenue
|
|
|
37,107
|
|
|
|
39,305
|
|
|
|
77,764
|
|
|
|
79,075
|
|
General and administrative expenses
|
|
|
193,239
|
|
|
|
161,479
|
|
|
|
381,326
|
|
|
|
302,757
|
|
Premium tax expenses
|
|
|
70,120
|
|
|
|
46,883
|
|
|
|
121,813
|
|
|
|
83,883
|
|
Health insurer fee expenses (1)
|
|
|
21,945
|
|
|
|
–
|
|
|
|
44,135
|
|
|
|
–
|
|
Depreciation and amortization
|
|
|
22,902
|
|
|
|
17,015
|
|
|
|
43,593
|
|
|
|
33,578
|
|
Total operating expenses
|
|
|
2,279,612
|
|
|
|
1,559,388
|
|
|
|
4,324,588
|
|
|
|
3,081,914
|
|
Operating income
|
|
|
32,427
|
|
|
|
46,446
|
|
|
|
56,694
|
|
|
|
114,319
|
|
Other expenses, net:
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
13,993
|
|
|
|
11,667
|
|
|
|
27,815
|
|
|
|
24,704
|
|
Other (income) expense, net
|
|
|
(9
|
)
|
|
|
3,502
|
|
|
|
(53
|
)
|
|
|
3,371
|
|
Total other expenses, net
|
|
|
13,984
|
|
|
|
15,169
|
|
|
|
27,762
|
|
|
|
28,075
|
|
Income from continuing operations before income tax expense
|
|
|
18,443
|
|
|
|
31,277
|
|
|
|
28,932
|
|
|
|
86,244
|
|
Income tax expense
|
|
|
10,702
|
|
|
|
15,481
|
|
|
|
16,357
|
|
|
|
39,926
|
|
Income from continuing operations
|
|
|
7,741
|
|
|
|
15,796
|
|
|
|
12,575
|
|
|
|
46,318
|
|
Income (loss) from discontinued operations, net of tax
|
|
|
70
|
|
|
|
8,775
|
|
|
|
(266
|
)
|
|
|
8,168
|
|
Net income
|
|
$
|
7,811
|
|
|
$
|
24,571
|
|
|
$
|
12,309
|
|
|
$
|
54,486
|
|
|
|
|
|
|
|
|
|
|
Diluted net income per share:
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
$
|
0.16
|
|
|
$
|
0.34
|
|
|
$
|
0.26
|
|
|
$
|
1.00
|
|
Discontinued operations
|
|
|
–
|
|
|
|
0.19
|
|
|
|
–
|
|
|
|
0.17
|
|
Diluted net income per share
|
|
$
|
0.16
|
|
|
$
|
0.53
|
|
|
$
|
0.26
|
|
|
$
|
1.17
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted average shares outstanding
|
|
|
48,003
|
|
|
|
46,507
|
|
|
|
47,824
|
|
|
|
46,506
|
|
|
|
|
|
|
|
|
|
|
Operating Statistics, Continuing Operations:
|
|
|
|
|
|
|
|
|
Medical care ratio (2)
|
|
|
89.3
|
%
|
|
|
86.2
|
%
|
|
|
89.0
|
%
|
|
|
86.1
|
%
|
Service revenue ratio (3)
|
|
|
73.9
|
%
|
|
|
79.1
|
%
|
|
|
74.9
|
%
|
|
|
79.5
|
%
|
General and administrative expense ratio (4)
|
|
|
8.4
|
%
|
|
|
10.1
|
%
|
|
|
8.7
|
%
|
|
|
9.5
|
%
|
Premium tax ratio (2)
|
|
|
3.1
|
%
|
|
|
3.0
|
%
|
|
|
2.9
|
%
|
|
|
2.7
|
%
|
Effective tax rate
|
|
|
58.0
|
%
|
|
|
49.5
|
%
|
|
|
56.5
|
%
|
|
|
46.3
|
%
|
|
____________
(1) Health insurer fee expenses represent insurer fees
levied by the federal government under the Affordable Care Act,
which are not tax deductible. Associated revenues represent state
and federal reimbursement of such fees (including the related
income tax effect) for Medicaid and Medicare insurers.
|
(2) Medical care ratio represents medical care costs as
a percentage of premium revenue; premium tax ratio represents
premium tax expenses as a percentage of premium revenue plus
premium tax revenue.
|
(3) Service revenue ratio represents cost of service
revenue as a percentage of service revenue.
|
(4) Computed as a percentage of total revenue.
|
|
|
|
MOLINA HEALTHCARE, INC. CONSOLIDATED BALANCE SHEETS
|
|
|
|
(Unaudited)
|
|
|
|
June 30,
2014
|
|
Dec. 31,
2013
|
|
|
(Amounts in thousands,
except per-share data)
|
ASSETS
|
Current assets:
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
1,027,351
|
|
$
|
935,895
|
|
Investments
|
|
|
740,874
|
|
|
703,052
|
|
Receivables
|
|
|
473,514
|
|
|
298,935
|
|
Income taxes refundable
|
|
|
16,726
|
|
|
32,742
|
|
Deferred income taxes
|
|
|
19,518
|
|
|
26,556
|
|
Prepaid expenses and other current assets
|
|
|
93,862
|
|
|
42,484
|
|
Total current assets
|
|
|
2,371,845
|
|
|
2,039,664
|
|
Property, equipment, and capitalized software, net
|
|
|
317,630
|
|
|
292,083
|
|
Deferred contract costs
|
|
|
47,969
|
|
|
45,675
|
|
Intangible assets, net
|
|
|
88,493
|
|
|
98,871
|
|
Goodwill
|
|
|
230,738
|
|
|
230,738
|
|
Restricted investments
|
|
|
84,440
|
|
|
63,093
|
|
Auction rate securities
|
|
|
11,025
|
|
|
10,898
|
|
Deferred income taxes
|
|
|
4,075
|
|
|
–
|
|
Derivative asset
|
|
|
250,160
|
|
|
186,351
|
|
Other assets
|
|
|
45,654
|
|
|
35,564
|
|
|
|
$
|
3,452,029
|
|
$
|
3,002,937
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
Current liabilities:
|
|
|
|
|
Medical claims and benefits payable
|
|
$
|
924,182
|
|
$
|
669,787
|
|
Accounts payable and accrued liabilities
|
|
|
475,358
|
|
|
319,965
|
|
Deferred revenue
|
|
|
45,945
|
|
|
122,216
|
|
Current maturities of long-term debt
|
|
|
185,451
|
|
|
182,008
|
|
Total current liabilities
|
|
|
1,630,936
|
|
|
1,293,976
|
|
Convertible senior notes
|
|
|
425,709
|
|
|
416,368
|
|
Lease financing obligations
|
|
|
160,121
|
|
|
159,394
|
|
Lease financing obligations – related party
|
|
|
39,436
|
|
|
27,092
|
|
Deferred income taxes
|
|
|
–
|
|
|
580
|
|
Derivative liability
|
|
|
250,038
|
|
|
186,239
|
|
Other long-term liabilities
|
|
|
28,719
|
|
|
26,351
|
|
Total liabilities
|
|
|
2,534,959
|
|
|
2,110,000
|
|
|
|
|
|
|
Stockholders’ equity:
|
|
|
|
|
Common stock, $0.001 par value; 150,000 shares authorized;
outstanding: 46,494 shares at June 30, 2014 and 45,871 shares at
December 31, 2013
|
|
|
46
|
|
|
46
|
|
Preferred stock, $0.001 par value; 20,000 shares authorized, no
shares issued and outstanding
|
|
|
–
|
|
|
–
|
|
Additional paid-in capital
|
|
|
351,546
|
|
|
340,848
|
|
Accumulated other comprehensive income (loss)
|
|
|
40
|
|
|
(1,086
|
)
|
Retained earnings
|
|
|
565,438
|
|
|
553,129
|
|
Total stockholders’ equity
|
|
|
917,070
|
|
|
892,937
|
|
|
|
$
|
3,452,029
|
|
$
|
3,002,937
|
|
|
|
|
MOLINA HEALTHCARE, INC. UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS, CONTINUING AND
DISCONTINUED OPERATIONS
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
(Amounts in thousands)
|
Operating activities:
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
7,811
|
|
|
$
|
24,571
|
|
|
$
|
12,309
|
|
|
$
|
54,486
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
32,660
|
|
|
|
22,108
|
|
|
|
65,654
|
|
|
|
43,907
|
|
Deferred income taxes
|
|
|
2,362
|
|
|
|
(22,139
|
)
|
|
|
1,692
|
|
|
|
(22,155
|
)
|
Stock-based compensation
|
|
|
4,860
|
|
|
|
7,729
|
|
|
|
10,456
|
|
|
|
12,150
|
|
Amortization of convertible senior notes and lease financing
obligations
|
|
|
6,781
|
|
|
|
5,965
|
|
|
|
13,455
|
|
|
|
9,688
|
|
Other, net
|
|
|
3,271
|
|
|
|
7,421
|
|
|
|
1,723
|
|
|
|
10,010
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Receivables
|
|
|
(135,282
|
)
|
|
|
(63,525
|
)
|
|
|
(174,579
|
)
|
|
|
(64,094
|
)
|
Prepaid expenses and other assets
|
|
|
11,136
|
|
|
|
(11,292
|
)
|
|
|
(66,887
|
)
|
|
|
(22,856
|
)
|
Medical claims and benefits payable
|
|
|
104,641
|
|
|
|
(25,658
|
)
|
|
|
254,395
|
|
|
|
(29,043
|
)
|
Accounts payable and accrued liabilities
|
|
|
75,280
|
|
|
|
14,879
|
|
|
|
177,497
|
|
|
|
(16,968
|
)
|
Deferred revenue
|
|
|
(100,331
|
)
|
|
|
(89,855
|
)
|
|
|
(76,271
|
)
|
|
|
(95,849
|
)
|
Income taxes
|
|
|
11,374
|
|
|
|
552
|
|
|
|
16,016
|
|
|
|
8,976
|
|
Net cash provided by (used in) operating activities
|
|
|
24,563
|
|
|
|
(129,244
|
)
|
|
|
235,460
|
|
|
|
(111,748
|
)
|
|
|
|
|
|
|
|
|
|
Investing activities:
|
|
|
|
|
|
|
|
|
Purchases of investments
|
|
|
(226,159
|
)
|
|
|
(456,139
|
)
|
|
|
(368,304
|
)
|
|
|
(532,151
|
)
|
Sales and maturities of investments
|
|
|
179,278
|
|
|
|
73,773
|
|
|
|
326,648
|
|
|
|
149,420
|
|
Purchases of equipment
|
|
|
(19,882
|
)
|
|
|
(24,062
|
)
|
|
|
(37,670
|
)
|
|
|
(35,229
|
)
|
Increase in restricted investments
|
|
|
(1,241
|
)
|
|
|
(1,818
|
)
|
|
|
(15,622
|
)
|
|
|
(12,834
|
)
|
Other, net
|
|
|
(6,841
|
)
|
|
|
(4,974
|
)
|
|
|
(7,388
|
)
|
|
|
(1,018
|
)
|
Net cash used in investing activities
|
|
|
(74,845
|
)
|
|
|
(413,220
|
)
|
|
|
(102,336
|
)
|
|
|
(431,812
|
)
|
|
|
|
|
|
|
|
|
|
Financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from issuance of 1.125% Notes, net of deferred financing
costs
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
537,973
|
|
Proceeds from sale-leaseback transactions
|
|
|
–
|
|
|
|
158,694
|
|
|
|
–
|
|
|
|
158,694
|
|
Purchase of 1.125% Notes call option
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(149,331
|
)
|
Proceeds from issuance of warrants
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
75,074
|
|
Treasury stock purchases
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(50,000
|
)
|
Principal payments on term loan
|
|
|
–
|
|
|
|
(47,180
|
)
|
|
|
–
|
|
|
|
(47,471
|
)
|
Repayment of amounts borrowed under credit facility
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(40,000
|
)
|
Contingent consideration liabilities settled
|
|
|
(12,230
|
)
|
|
|
–
|
|
|
|
(50,349
|
)
|
|
|
–
|
|
Other, net
|
|
|
6,494
|
|
|
|
4,109
|
|
|
|
8,681
|
|
|
|
5,521
|
|
Net cash (used in) provided by financing activities
|
|
|
(5,736
|
)
|
|
|
115,623
|
|
|
|
(41,668
|
)
|
|
|
490,460
|
|
Net (decrease) increase in cash and cash equivalents
|
|
|
(56,018
|
)
|
|
|
(426,841
|
)
|
|
|
91,456
|
|
|
|
(53,100
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
1,083,369
|
|
|
|
1,169,511
|
|
|
|
935,895
|
|
|
|
795,770
|
|
Cash and cash equivalents at end of period
|
|
$
|
1,027,351
|
|
|
$
|
742,670
|
|
|
$
|
1,027,351
|
|
|
$
|
742,670
|
|
|
|
|
MOLINA HEALTHCARE, INC. UNAUDITED NON-GAAP
FINANCIAL MEASURES
|
|
The Company uses two non-GAAP financial measures as supplemental
metrics in evaluating its financial performance, making financing
and business decisions, and forecasting and planning for future
periods. For these reasons, management believes such measures are
useful supplemental measures to investors in comparing the
Company’s performance to the performance of other public companies
in the health care industry. These non-GAAP financial measures
should be considered as supplements to, and not as substitutes for
or superior to, GAAP measures.
|
|
The first of these non-GAAP measures is earnings before interest,
taxes, depreciation and amortization (EBITDA). The following table
reconciles net income, which the Company believes to be the most
comparable GAAP measure, to EBITDA.
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
(Amounts in thousands)
|
Net income
|
|
$
|
7,811
|
|
|
$
|
24,571
|
|
$
|
12,309
|
|
$
|
54,486
|
Adjustments:
|
|
|
|
|
|
|
|
|
Depreciation, and amortization of intangible assets and capitalized
software
|
|
|
28,292
|
|
|
|
22,108
|
|
|
54,206
|
|
|
43,907
|
Interest expense
|
|
|
13,993
|
|
|
|
11,667
|
|
|
27,815
|
|
|
24,704
|
Income tax expense
|
|
|
10,760
|
|
|
|
5,513
|
|
|
15,997
|
|
|
29,783
|
EBITDA
|
|
$
|
60,856
|
|
|
$
|
63,859
|
|
$
|
110,327
|
|
$
|
152,880
|
|
The second of these non-GAAP measures is adjusted net income,
continuing operations (including adjusted net income per diluted
share). The following table reconciles net income from continuing
operations, which the Company believes to be the most comparable
GAAP measure, to adjusted net income, continuing operations.
|
|
|
|
Three Months Ended June 30,
|
|
|
2014
|
|
2013
|
|
|
(In thousands, except per diluted share amounts)
|
Net income, continuing operations
|
|
$
|
7,741
|
|
|
$
|
0.16
|
|
$
|
15,796
|
|
$
|
0.34
|
Adjustments, net of tax:
|
|
|
|
|
|
|
|
|
Depreciation, and amortization of capitalized software
|
|
|
14,614
|
|
|
|
0.30
|
|
|
10,875
|
|
|
0.23
|
Stock-based compensation
|
|
|
4,322
|
|
|
|
0.09
|
|
|
5,890
|
|
|
0.13
|
Amortization of convertible senior notes and lease financing
obligations
|
|
|
4,272
|
|
|
|
0.09
|
|
|
3,758
|
|
|
0.08
|
Amortization of intangible assets
|
|
|
3,209
|
|
|
|
0.07
|
|
|
3,053
|
|
|
0.07
|
Change in fair value of derivatives, net
|
|
|
(5
|
)
|
|
|
–
|
|
|
3,658
|
|
|
0.08
|
Adjusted net income, continuing operations
|
|
$
|
34,153
|
|
|
$
|
0.71
|
|
$
|
43,030
|
|
$
|
0.93
|
|
|
|
Six Months Ended June 30,
|
|
|
2014
|
|
2013
|
|
|
(In thousands, except per diluted share amounts)
|
Net income, continuing operations
|
|
$
|
12,575
|
|
|
$
|
0.26
|
|
$
|
46,318
|
|
$
|
1.00
|
Adjustments, net of tax:
|
|
|
|
|
|
|
|
|
Depreciation, and amortization of capitalized software
|
|
|
27,612
|
|
|
|
0.58
|
|
|
21,554
|
|
|
0.46
|
Stock-based compensation
|
|
|
9,221
|
|
|
|
0.19
|
|
|
9,490
|
|
|
0.20
|
Amortization of convertible senior notes and lease financing
obligations
|
|
|
8,477
|
|
|
|
0.18
|
|
|
6,103
|
|
|
0.13
|
Amortization of intangible assets
|
|
|
6,538
|
|
|
|
0.14
|
|
|
6,107
|
|
|
0.13
|
Change in fair value of derivatives, net
|
|
|
(6
|
)
|
|
|
–
|
|
|
3,583
|
|
|
0.08
|
Adjusted net income, continuing operations
|
|
$
|
64,417
|
|
|
$
|
1.35
|
|
$
|
93,155
|
|
$
|
2.00
|
|
|
|
MOLINA HEALTHCARE, INC. UNAUDITED HEALTH PLANS
SEGMENT MEMBERSHIP DATA, CONTINUING OPERATIONS
|
|
|
|
June 30,
2014
|
|
March 31,
2014
|
|
Dec. 31,
2013
|
|
June 30,
2013
|
Ending Membership by Health Plan:
|
|
|
|
|
|
|
|
|
California
|
|
455,000
|
|
418,000
|
|
368,000
|
|
355,000
|
Florida (1)
|
|
58,000
|
|
91,000
|
|
89,000
|
|
81,000
|
Illinois
|
|
6,000
|
|
5,000
|
|
4,000
|
|
–
|
Michigan
|
|
244,000
|
|
218,000
|
|
213,000
|
|
215,000
|
New Mexico
|
|
195,000
|
|
183,000
|
|
168,000
|
|
92,000
|
Ohio
|
|
302,000
|
|
260,000
|
|
255,000
|
|
240,000
|
South Carolina (2)
|
|
119,000
|
|
126,000
|
|
–
|
|
–
|
Texas
|
|
247,000
|
|
246,000
|
|
252,000
|
|
266,000
|
Utah
|
|
83,000
|
|
80,000
|
|
86,000
|
|
87,000
|
Washington
|
|
461,000
|
|
434,000
|
|
403,000
|
|
413,000
|
Wisconsin
|
|
85,000
|
|
90,000
|
|
93,000
|
|
98,000
|
|
|
2,255,000
|
|
2,151,000
|
|
1,931,000
|
|
1,847,000
|
|
|
|
|
|
|
|
|
|
Ending Membership by Program:
|
|
|
|
|
|
|
|
|
Temporary Assistance for Needy Families (TANF)
|
|
1,564,500
|
|
1,575,300
|
|
1,503,800
|
|
1,435,400
|
Aged, Blind or Disabled (ABD)
|
|
305,300
|
|
309,900
|
|
288,600
|
|
270,300
|
Medicaid Expansion (3)
|
|
232,300
|
|
133,000
|
|
–
|
|
–
|
Children’s Health Insurance Program (CHIP)
|
|
77,000
|
|
83,700
|
|
99,200
|
|
105,000
|
Medicare Special Needs Plans
|
|
44,000
|
|
41,400
|
|
39,400
|
|
36,300
|
Health Insurance Marketplaces (3)
|
|
18,300
|
|
7,700
|
|
–
|
|
–
|
Medicare-Medicaid Plan (MMP) - Integrated (4)
|
|
5,200
|
|
–
|
|
–
|
|
–
|
MMP - Medicare Opt Out (5)
|
|
8,400
|
|
–
|
|
–
|
|
–
|
|
|
2,255,000
|
|
2,151,000
|
|
1,931,000
|
|
1,847,000
|
|
____________
(1) Enrollment at the Florida health plan declined
between the first and second quarters of 2014 due to a
reassignment of membership as part of the implementation of
Florida’s Managed Medical Assistance program. The Company believes
that enrollment at its Florida health plan will grow later in the
year.
|
(2) The South Carolina health plan began serving
members under the state of South Carolina’s new full-risk Medicaid
managed care program effective January 1, 2014.
|
(3) Medicaid Expansion membership phased in, and Health
Insurance Marketplaces became available for consumers to access
coverage, beginning January 1, 2014.
|
(4) Medicare-Medicaid Plans (MMP) serve members who are
dually eligible for Medicare and Medicaid. The Company’s MMP
implementations in California and Illinois offered coverage
beginning in April 2014 and Ohio beginning in June 2014.
|
(5) Medicare-Medicaid members who have elected to “opt
out” of Medicare coverage and receive Medicaid only.
|
|
|
|
MOLINA HEALTHCARE, INC. UNAUDITED SELECTED HEALTH
PLANS SEGMENT FINANCIAL DATA, CONTINUING OPERATIONS (In
thousands, except percentages and per-member-per-month amounts)
|
|
|
|
Three Months Ended June 30, 2014
|
|
Member
Months (1)
|
|
Premium Revenue
|
|
Medical Care Costs
|
|
MCR (2)
|
|
Medical
Margin
|
|
|
Total
|
|
PMPM
|
|
Total
|
|
PMPM
|
|
|
California
|
|
1,335
|
|
$
|
398,071
|
|
|
$
|
298.11
|
|
$
|
324,923
|
|
$
|
243.33
|
|
81.6
|
%
|
|
$
|
73,148
|
|
Florida
|
|
229
|
|
|
101,423
|
|
|
|
443.05
|
|
|
92,865
|
|
|
405.67
|
|
91.6
|
|
|
|
8,558
|
|
Illinois (3)
|
|
17
|
|
|
19,263
|
|
|
|
1,136.20
|
|
|
20,472
|
|
|
1,207.48
|
|
106.3
|
|
|
|
(1,209
|
)
|
Michigan
|
|
702
|
|
|
185,337
|
|
|
|
264.18
|
|
|
163,392
|
|
|
232.89
|
|
88.2
|
|
|
|
21,945
|
|
New Mexico
|
|
617
|
|
|
267,994
|
|
|
|
434.57
|
|
|
240,151
|
|
|
389.42
|
|
89.6
|
|
|
|
27,843
|
|
Ohio
|
|
849
|
|
|
328,630
|
|
|
|
386.79
|
|
|
276,716
|
|
|
325.69
|
|
84.2
|
|
|
|
51,914
|
|
South Carolina
|
|
360
|
|
|
96,453
|
|
|
|
268.38
|
|
|
84,686
|
|
|
235.64
|
|
87.8
|
|
|
|
11,767
|
|
Texas
|
|
742
|
|
|
320,966
|
|
|
|
432.46
|
|
|
297,899
|
|
|
401.38
|
|
92.8
|
|
|
|
23,067
|
|
Utah
|
|
249
|
|
|
76,574
|
|
|
|
307.47
|
|
|
73,094
|
|
|
293.49
|
|
95.5
|
|
|
|
3,480
|
|
Washington
|
|
1,364
|
|
|
336,959
|
|
|
|
247.03
|
|
|
305,098
|
|
|
223.67
|
|
90.5
|
|
|
|
31,861
|
|
Wisconsin
|
|
256
|
|
|
36,925
|
|
|
|
144.42
|
|
|
33,143
|
|
|
129.63
|
|
89.8
|
|
|
|
3,782
|
|
Other (4)
|
|
–
|
|
|
(1,453
|
)
|
|
|
–
|
|
|
21,860
|
|
|
–
|
|
–
|
|
|
|
(23,313
|
)
|
|
|
6,720
|
|
$
|
2,167,142
|
|
|
$
|
322.52
|
|
$
|
1,934,299
|
|
$
|
287.87
|
|
89.3
|
%
|
|
$
|
232,843
|
|
|
|
|
|
Three Months Ended June 30, 2013
|
|
Member
Months (1)
|
|
Premium Revenue
|
|
Medical Care Costs
|
|
MCR (2)
|
|
Medical
Margin
|
|
|
Total
|
|
PMPM
|
|
Total
|
|
PMPM
|
|
|
California
|
|
1,055
|
|
$
|
180,927
|
|
|
$
|
171.58
|
|
$
|
170,777
|
|
$
|
161.96
|
|
94.4
|
%
|
|
$
|
10,150
|
|
Florida
|
|
238
|
|
|
61,837
|
|
|
|
260.61
|
|
|
51,915
|
|
|
218.80
|
|
84.0
|
|
|
|
9,922
|
|
Illinois
|
|
–
|
|
|
–
|
|
|
|
–
|
|
|
–
|
|
|
–
|
|
–
|
|
|
|
–
|
|
Michigan
|
|
648
|
|
|
167,485
|
|
|
|
258.40
|
|
|
141,859
|
|
|
218.86
|
|
84.7
|
|
|
|
25,626
|
|
New Mexico
|
|
275
|
|
|
84,449
|
|
|
|
307.20
|
|
|
68,253
|
|
|
248.28
|
|
80.8
|
|
|
|
16,196
|
|
Ohio
|
|
722
|
|
|
270,107
|
|
|
|
373.78
|
|
|
215,664
|
|
|
298.44
|
|
79.8
|
|
|
|
54,443
|
|
South Carolina
|
|
–
|
|
|
–
|
|
|
|
–
|
|
|
–
|
|
|
–
|
|
–
|
|
|
|
–
|
|
Texas
|
|
805
|
|
|
318,955
|
|
|
|
396.05
|
|
|
275,959
|
|
|
342.66
|
|
86.5
|
|
|
|
42,996
|
|
Utah
|
|
261
|
|
|
77,511
|
|
|
|
296.69
|
|
|
61,677
|
|
|
236.08
|
|
79.6
|
|
|
|
15,834
|
|
Washington
|
|
1,238
|
|
|
299,533
|
|
|
|
241.89
|
|
|
263,512
|
|
|
212.80
|
|
88.0
|
|
|
|
36,021
|
|
Wisconsin
|
|
293
|
|
|
37,740
|
|
|
|
128.79
|
|
|
31,185
|
|
|
106.43
|
|
82.6
|
|
|
|
6,555
|
|
Other (3)(4)
|
|
–
|
|
|
3,185
|
|
|
|
–
|
|
|
13,905
|
|
|
–
|
|
–
|
|
|
|
(10,720
|
)
|
|
|
5,535
|
|
$
|
1,501,729
|
|
|
$
|
271.30
|
|
$
|
1,294,706
|
|
$
|
233.91
|
|
86.2
|
%
|
|
$
|
207,023
|
|
|
____________
(1) A member month is defined as the aggregate of each
month’s ending membership for the period presented.
|
(2) The MCR represents medical costs as a percentage of
premium revenue.
|
(3) The Illinois health plan’s results prior to October
1, 2013, were insignificant and reported in “Other.”
|
(4) “Other” medical care costs include primarily
medically related administrative costs at the parent company, and
direct delivery costs.
|
|
|
|
MOLINA HEALTHCARE, INC. UNAUDITED SELECTED HEALTH
PLANS SEGMENT FINANCIAL DATA, CONTINUING OPERATIONS (In
thousands, except percentages and per-member-per-month amounts)
|
|
|
|
Six Months Ended June 30, 2014
|
|
Member
Months (1)
|
|
Premium Revenue
|
|
Medical Care Costs
|
|
MCR (2)
|
|
Medical
Margin
|
|
|
Total
|
|
PMPM
|
|
Total
|
|
PMPM
|
|
|
California
|
|
2,589
|
|
$
|
675,713
|
|
$
|
260.97
|
|
$
|
562,267
|
|
$
|
217.16
|
|
83.2
|
%
|
|
$
|
113,446
|
|
Florida
|
|
499
|
|
|
206,589
|
|
|
414.17
|
|
|
186,326
|
|
|
373.55
|
|
90.2
|
|
|
|
20,263
|
|
Illinois (3)
|
|
31
|
|
|
34,434
|
|
|
1,109.99
|
|
|
34,966
|
|
|
1,127.12
|
|
101.5
|
|
|
|
(532
|
)
|
Michigan
|
|
1,350
|
|
|
358,833
|
|
|
265.81
|
|
|
298,712
|
|
|
221.27
|
|
83.2
|
|
|
|
60,121
|
|
New Mexico
|
|
1,166
|
|
|
493,062
|
|
|
423.00
|
|
|
436,560
|
|
|
374.53
|
|
88.5
|
|
|
|
56,502
|
|
Ohio
|
|
1,621
|
|
|
606,925
|
|
|
374.33
|
|
|
514,044
|
|
|
317.04
|
|
84.7
|
|
|
|
92,881
|
|
South Carolina
|
|
754
|
|
|
192,473
|
|
|
255.31
|
|
|
174,948
|
|
|
232.07
|
|
90.9
|
|
|
|
17,525
|
|
Texas
|
|
1,491
|
|
|
641,062
|
|
|
429.85
|
|
|
590,857
|
|
|
396.19
|
|
92.2
|
|
|
|
50,205
|
|
Utah
|
|
495
|
|
|
155,228
|
|
|
313.67
|
|
|
140,294
|
|
|
283.49
|
|
90.4
|
|
|
|
14,934
|
|
Washington
|
|
2,640
|
|
|
660,420
|
|
|
250.15
|
|
|
603,205
|
|
|
228.48
|
|
91.3
|
|
|
|
57,215
|
|
Wisconsin
|
|
530
|
|
|
75,453
|
|
|
142.48
|
|
|
61,952
|
|
|
116.99
|
|
82.1
|
|
|
|
13,501
|
|
Other (4)
|
|
–
|
|
|
7,287
|
|
|
–
|
|
|
51,826
|
|
|
–
|
|
–
|
|
|
|
(44,539
|
)
|
|
|
13,166
|
|
$
|
4,107,479
|
|
$
|
311.98
|
|
$
|
3,655,957
|
|
$
|
277.69
|
|
89.0
|
%
|
|
$
|
451,522
|
|
|
|
|
|
Six Months Ended June 30, 2013
|
|
Member
Months (1)
|
|
Premium Revenue
|
|
Medical Care Costs
|
|
MCR (2)
|
|
Medical
Margin
|
|
|
Total
|
|
PMPM
|
|
Total
|
|
PMPM
|
|
|
California
|
|
2,056
|
|
$
|
368,715
|
|
$
|
179.36
|
|
$
|
330,540
|
|
$
|
160.79
|
|
89.6
|
%
|
|
$
|
38,175
|
|
Florida
|
|
461
|
|
|
120,001
|
|
|
260.38
|
|
|
101,319
|
|
|
219.84
|
|
84.4
|
|
|
|
18,682
|
|
Illinois
|
|
–
|
|
|
–
|
|
|
–
|
|
|
–
|
|
|
–
|
|
–
|
|
|
|
–
|
|
Michigan
|
|
1,300
|
|
|
334,042
|
|
|
256.96
|
|
|
288,607
|
|
|
222.01
|
|
86.4
|
|
|
|
45,435
|
|
New Mexico
|
|
549
|
|
|
168,449
|
|
|
307.08
|
|
|
140,402
|
|
|
255.95
|
|
83.3
|
|
|
|
28,047
|
|
Ohio
|
|
1,448
|
|
|
538,915
|
|
|
372.10
|
|
|
443,118
|
|
|
305.96
|
|
82.2
|
|
|
|
95,797
|
|
South Carolina
|
|
–
|
|
|
–
|
|
|
–
|
|
|
–
|
|
|
–
|
|
–
|
|
|
|
–
|
|
Texas
|
|
1,637
|
|
|
648,406
|
|
|
396.01
|
|
|
542,408
|
|
|
331.27
|
|
83.7
|
|
|
|
105,998
|
|
Utah
|
|
520
|
|
|
152,467
|
|
|
293.16
|
|
|
126,706
|
|
|
243.63
|
|
83.1
|
|
|
|
25,761
|
|
Washington
|
|
2,488
|
|
|
597,819
|
|
|
240.29
|
|
|
524,909
|
|
|
210.98
|
|
87.8
|
|
|
|
72,910
|
|
Wisconsin
|
|
493
|
|
|
64,864
|
|
|
131.53
|
|
|
54,849
|
|
|
111.22
|
|
84.6
|
|
|
|
10,015
|
|
Other (3)(4)
|
|
–
|
|
|
5,484
|
|
|
–
|
|
|
29,763
|
|
|
–
|
|
–
|
|
|
|
(24,279
|
)
|
|
|
10,952
|
|
$
|
2,999,162
|
|
$
|
273.85
|
|
$
|
2,582,621
|
|
$
|
235.81
|
|
86.1
|
%
|
|
$
|
416,541
|
|
|
____________
(1) A member month is defined as the aggregate of each
month’s ending membership for the period presented.
|
(2) The MCR represents medical costs as a percentage of
premium revenue.
|
(3) The Illinois health plan’s results prior to October
1, 2013, were insignificant and reported in “Other.”
|
(4) “Other” medical care costs include primarily
medically related administrative costs at the parent company, and
direct delivery costs.
|
|
|
|
MOLINA HEALTHCARE, INC. UNAUDITED SELECTED
FINANCIAL DATA (Dollars in thousands, except
per-member-per-month amounts)
|
|
The following tables provide the details of the Company’s medical
care costs from continuing operations for the periods indicated:
|
|
|
|
Three Months Ended June 30,
|
|
|
2014
|
|
2013
|
|
|
Amount
|
|
PMPM
|
|
% of
Total
|
|
Amount
|
|
PMPM
|
|
% of
Total
|
Fee for service
|
|
$
|
1,378,037
|
|
$
|
205.08
|
|
71.2
|
%
|
|
$
|
879,865
|
|
$
|
158.96
|
|
|
68.0
|
%
|
Pharmacy
|
|
|
295,596
|
|
|
43.99
|
|
15.3
|
|
|
|
222,992
|
|
|
40.29
|
|
|
17.2
|
|
Capitation
|
|
|
176,817
|
|
|
26.31
|
|
9.1
|
|
|
|
138,409
|
|
|
25.00
|
|
|
10.7
|
|
Direct delivery
|
|
|
23,063
|
|
|
3.43
|
|
1.2
|
|
|
|
9,443
|
|
|
1.71
|
|
|
0.7
|
|
Other
|
|
|
60,786
|
|
|
9.06
|
|
3.2
|
|
|
|
43,997
|
|
|
7.95
|
|
|
3.4
|
|
|
|
$
|
1,934,299
|
|
$
|
287.87
|
|
100.0
|
%
|
|
$
|
1,294,706
|
|
$
|
233.91
|
|
|
100.0
|
%
|
|
|
|
|
Six Months Ended June 30,
|
|
|
2014
|
|
2013
|
|
|
Amount
|
|
PMPM
|
|
% of
Total
|
|
Amount
|
|
PMPM
|
|
% of
Total
|
Fee for service
|
|
$
|
2,559,098
|
|
$
|
194.38
|
|
70.0
|
%
|
|
$
|
1,746,620
|
|
$
|
159.48
|
|
|
67.6
|
%
|
Pharmacy
|
|
|
582,224
|
|
|
44.22
|
|
15.9
|
|
|
|
454,830
|
|
|
41.53
|
|
|
17.6
|
|
Capitation
|
|
|
346,256
|
|
|
26.30
|
|
9.5
|
|
|
|
278,733
|
|
|
25.45
|
|
|
10.8
|
|
Direct delivery
|
|
|
45,084
|
|
|
3.42
|
|
1.2
|
|
|
|
18,127
|
|
|
1.66
|
|
|
0.7
|
|
Other
|
|
|
123,295
|
|
|
9.37
|
|
3.4
|
|
|
|
84,311
|
|
|
7.69
|
|
|
3.3
|
|
|
|
$
|
3,655,957
|
|
$
|
277.69
|
|
100.0
|
%
|
|
$
|
2,582,621
|
|
$
|
235.81
|
|
|
100.0
|
%
|
|
|
The following table provides the details of the Company’s medical
claims and benefits payable as of the dates indicated:
|
|
|
|
June 30,
2014
|
|
Dec. 31,
2013
|
Fee-for-service claims incurred but not paid (IBNP)
|
|
$
|
697,038
|
|
$
|
424,173
|
|
Pharmacy payable
|
|
|
54,935
|
|
|
45,037
|
|
Capitation payable
|
|
|
29,560
|
|
|
20,267
|
|
Other
|
|
|
142,649
|
|
|
180,310
|
|
|
|
$
|
924,182
|
|
$
|
669,787
|
|
|
|
|
MOLINA HEALTHCARE, INC. UNAUDITED CHANGE IN MEDICAL
CLAIMS AND BENEFITS PAYABLE
|
|
The Company’s claims liability includes an allowance for adverse
claims development based on historical experience and other
factors including, but not limited to, variations in claims
payment patterns, changes in utilization and cost trends, known
outbreaks of disease, and large claims. The Company’s reserving
methodology is consistently applied across all periods presented.
The amounts displayed for “Components of medical care costs
related to: Prior period” represent the amount by which the
Company’s original estimate of claims and benefits payable at the
beginning of the period were more than the actual amount of the
liability based on information (principally the payment of claims)
developed since that liability was first reported. The following
table shows the components of the change in medical claims and
benefits payable from continuing and discontinued operations as of
the periods indicated:
|
|
|
|
Six Months Ended
June 30,
|
|
Year Ended
Dec. 31,
2013
|
|
2014
|
|
2013
|
|
|
|
(Dollars in thousands, except per-member amounts)
|
Balances at beginning of period
|
|
$
|
669,787
|
|
|
$
|
494,530
|
|
|
$
|
494,530
|
|
Components of medical care costs related to:
|
|
|
|
|
|
|
Current period
|
|
|
3,693,730
|
|
|
|
2,647,083
|
|
|
|
5,434,443
|
|
Prior period
|
|
|
(37,131
|
)
|
|
|
(62,757
|
)
|
|
|
(52,779
|
)
|
Total medical care costs
|
|
|
3,656,599
|
|
|
|
2,584,326
|
|
|
|
5,381,664
|
|
|
|
|
|
|
|
|
Change in non-risk provider payables
|
|
|
(83,044
|
)
|
|
|
(10,888
|
)
|
|
|
111,267
|
|
Payments for medical care costs related to:
|
|
|
|
|
|
|
Current period
|
|
|
2,891,174
|
|
|
|
2,235,617
|
|
|
|
4,932,195
|
|
Prior period
|
|
|
427,986
|
|
|
|
366,864
|
|
|
|
385,479
|
|
Total paid
|
|
|
3,319,160
|
|
|
|
2,602,481
|
|
|
|
5,317,674
|
|
Balances at end of period
|
|
$
|
924,182
|
|
|
$
|
465,487
|
|
|
$
|
669,787
|
|
|
|
|
|
|
|
|
Benefit from prior period as a percentage of:
|
|
|
|
|
|
|
Balance at beginning of period
|
|
|
5.5
|
%
|
|
|
12.7
|
%
|
|
|
10.7
|
%
|
Premium revenue, trailing twelve months
|
|
|
0.5
|
%
|
|
|
1.1
|
%
|
|
|
0.9
|
%
|
Medical care costs, trailing twelve months
|
|
|
0.6
|
%
|
|
|
1.2
|
%
|
|
|
1.0
|
%
|
|
|
|
|
|
|
|
Claims Data:
|
|
|
|
|
|
|
Days in claims payable, fee for service
|
|
|
46
|
|
|
|
38
|
|
|
|
43
|
|
Number of members at end of period
|
|
|
2,255,000
|
|
|
|
1,847,000
|
|
|
|
1,931,000
|
|
Number of claims in inventory at end of period
|
|
|
180,600
|
|
|
|
109,900
|
|
|
|
145,800
|
|
Billed charges of claims in inventory at end of period
|
|
$
|
400,000
|
|
|
$
|
200,400
|
|
|
$
|
276,500
|
|
Claims in inventory per member at end of period
|
|
|
0.08
|
|
|
|
0.06
|
|
|
|
0.08
|
|
Billed charges of claims in inventory per member at end of period
|
|
$
|
177.38
|
|
|
$
|
108.50
|
|
|
$
|
143.19
|
|
Number of claims received during the period
|
|
|
12,641,300
|
|
|
|
10,524,500
|
|
|
|
21,317,500
|
|
Billed charges of claims received during the period
|
|
$
|
13,609,000
|
|
|
$
|
10,477,900
|
|
|
$
|
21,414,600
|
|
|
|
Copyright Business Wire 2014