Content analysis
?Positive | ||
Negative | ||
Uncertain | ||
Constraining | ||
Legalese | ||
Litigous | ||
Readability |
8th grade Avg
|
Financial report summary
?Risks
- If the responsive bids of our health plans for new or renewed Medicaid contracts are not successful, or if our government contracts are terminated or are not renewed on favorable terms, our premium revenues could be materially reduced and our operating results could be negatively impacted.
- Our Marketplace business has been volatile and has suffered significant losses in the past.
- We are subject to risks associated with outsourcing services and functions to third parties.
- If we or one of our significant vendors sustain a cyber-attack or suffer data privacy or security breaches that disrupt our information systems or operations, or result in the dissemination of sensitive personal or confidential information, we could suffer increased costs, exposure to significant liability, reputational harm, loss of business, and other serious negative consequences.
- We may be unable to successfully integrate our acquisitions or realize the anticipated benefits of such acquisitions.
- Failure to attain profitability in any newly acquired health plans or new start-up operations could negatively affect our results of operations.
- If we lose contracts that constitute a significant amount of our premium revenue, we will lose the administrative cost efficiencies or cost leverage that is inherent in a larger revenue base. In such circumstances, we may not be able to reduce fixed costs proportionally with our lower revenue, and the financial impact of lost contracts may exceed the net income ascribed to those contracts.
- Our health plans are subject to risk associated with various contractual provisions and regulations establishing medical cost expenditure floors, profit ceilings, risk corridors, and quality withholds.
- Our Medicaid premium revenues could be adversely impacted by retroactive adjustments or states’ delays in processing rate changes.
- If, in the interest of long-term profitability, we decide to exit certain state contractual arrangements, make changes to our provider networks, or make changes to our administrative infrastructure, we may incur disruptions to our business that could in the short term materially reduce our premium revenues and our net income.
- A failure to accurately estimate incurred but not paid medical care costs may negatively impact our results of operations.
- If we fail to accurately predict and effectively manage our medical care costs, our operating results could be materially and adversely affected.
- If we are unable to deliver quality care, and maintain good relations with the physicians, hospitals, and other providers with whom we contract, or if we are unable to enter into cost-effective contracts with such providers, our profitability could be adversely affected.
- We rely on the accuracy of eligibility lists provided by state governments. Inaccuracies in those lists would negatively affect our results of operations.
- The insolvency of a delegated provider could obligate us to pay its referral claims, which could have a material adverse effect on our business, financial condition, cash flows, or results of operations.
- Receipt of inadequate or significantly delayed premiums could negatively affect our business, financial condition, cash flows, or results of operations.
- If a state fails to renew its federal waiver application for mandated Medicaid enrollment into managed care or such application is denied, our membership in that state will likely decrease.
- Our business depends on our information and medical management systems, and our inability to effectively integrate, manage, update, and keep secure our information and medical management systems could disrupt our operations.
- Our encounter data, or the encounter data of the health plans we acquire, may be inaccurate or incomplete, which could have a material adverse effect on our results of operations, financial condition, cash flows and ability to bid for, and continue to participate in, certain programs.
- We may not be successful in our artificial intelligence (“AI”) administrative and operational initiatives, which could adversely affect our business, reputation, or financial results.
- An impairment charge with respect to our recorded goodwill, or our finite-lived intangible assets, could have a material impact on our financial results.
- The May 2020 contract award to our Kentucky Medicaid plan is the subject of a pending appeal before the Kentucky Supreme Court.
- The value of our investments is influenced by varying economic and market conditions, and a decrease in value may result in a loss charged to income.
- RISKS RELATED TO OUR INDUSTRY
- CMS will end the current MMP program no later than December 2025, which could impact premium revenue.
- Our health plans operate with very low profit margins, and small changes in operating performance or slight changes to our accounting estimates could have a disproportionate impact on our reported net income.
- If state regulators do not approve payments of dividends and distributions by our subsidiaries, it may negatively affect our ability to meet our debt service and other obligations.
- Our use and disclosure of personally identifiable information and other non-public information, including protected health information, is subject to federal and state privacy and security regulations, and our failure or the failure of our vendors to comply with those regulations or to adequately secure the information we hold could result in significant liability or reputational harm.
- Unforeseen changes in pharmaceutical regulations or market conditions may impact our revenues and adversely affect our results of operations.
- Increases in our pharmaceutical costs could have a material adverse effect on the level of our medical costs and our results of operations.
- Large-scale medical emergencies in one or more states in which we operate our health plans could significantly increase utilization rates and medical costs.
- We face various risks inherent in the government contracting process that could materially and adversely affect our business and profitability, including periodic routine and non-routine reviews, audits, and investigations by government agencies.
- Any changes to the laws and regulations governing our business, or the interpretation and enforcement of those laws or regulations, could require us to modify our operations and could negatively impact our operating results.
- We are subject to extensive fraud and abuse laws that may give rise to lawsuits and claims against us, the outcome of which may have a material adverse effect on our business, financial condition, cash flows, or results of operations.
- Adverse credit market conditions may have a material adverse effect on our liquidity or our ability to obtain credit on acceptable terms.
- We are dependent on the leadership of our chief executive officer and other executive officers and key employees.
- We face risks related to litigation.
- Failure to maintain effective internal controls over financial reporting could have a material adverse effect on our business, operating results, and stock price, and could subject us to sanctions by regulatory authorities.
- Because our corporate headquarters are located in Southern California, our business operations may be disrupted as a result of a major earthquake or wildfire.
- CYBERSECURITY RISK MANAGEMENT, GOVERNANCE AND RISK ASSESSMENT
- CYBERSECURITY RISK MANAGEMENT
- CYBERSECURITY RISK ASSESSMENT