Document and Entity Information
Document and Entity Information - shares shares in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Oct. 23, 2015 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | moh | |
Entity Registrant Name | MOLINA HEALTHCARE INC | |
Entity Central Index Key | 1,179,929 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 56,082 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 2,164,210 | $ 1,539,063 |
Investments | 1,461,467 | 1,019,462 |
Receivables | 619,891 | 596,456 |
Deferred income taxes | 54,231 | 39,532 |
Prepaid expenses and other current assets | 120,438 | 50,884 |
Derivative asset | 490,087 | 0 |
Total current assets | 4,910,324 | 3,245,397 |
Property, equipment, and capitalized software, net | 374,862 | 340,778 |
Deferred contract costs | 73,619 | 53,675 |
Intangible assets, net | 96,424 | 89,273 |
Goodwill | 321,220 | 271,964 |
Restricted investments | 101,970 | 102,479 |
Derivative asset | 0 | 329,323 |
Other assets | 36,612 | 44,326 |
Total Assets | 5,915,031 | 4,477,215 |
Current liabilities: | ||
Medical claims and benefits payable | 1,559,570 | 1,200,522 |
Amounts due government agencies | 980,317 | 527,193 |
Accounts payable and accrued liabilities | 274,131 | 241,654 |
Deferred revenue | 67,227 | 196,076 |
Income taxes payable | 39,205 | 8,987 |
Current portion of long-term debt | 450,780 | 341 |
Derivative liability | 489,940 | 0 |
Total current liabilities | 3,861,170 | 2,174,773 |
Convertible senior notes | 275,050 | 704,097 |
Lease financing obligations | 161,553 | 160,710 |
Lease financing obligations – related party | 39,868 | 40,241 |
Deferred income taxes | 27,111 | 24,271 |
Derivative liability | 0 | 329,194 |
Other long-term liabilities | 32,270 | 33,487 |
Total liabilities | 4,397,022 | 3,466,773 |
Stockholders’ equity: | ||
Common stock, $0.001 par value; 150,000 shares authorized; outstanding: 56,075 shares at September 30, 2015 and 49,727 shares at December 31, 2014 | 56 | 50 |
Preferred stock, $0.001 par value; 20,000 shares authorized, no shares issued and outstanding | 0 | 0 |
Additional paid-in capital | 789,907 | 396,059 |
Accumulated other comprehensive loss | (701) | (1,019) |
Retained earnings | 728,747 | 615,352 |
Total stockholders' equity | 1,518,009 | 1,010,442 |
Total liabilities and stockholders' equity | $ 5,915,031 | $ 4,477,215 |
CONSOLIDATED BALANCE SHEETS (U3
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares outstanding | 56,075,000 | 49,727,000 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenue: | ||||
Premium revenue | $ 3,377,030 | $ 2,316,759 | $ 9,652,054 | $ 6,424,238 |
Service revenue | 47,551 | 52,557 | 146,652 | 156,419 |
Premium tax revenue | 99,047 | 81,240 | 289,003 | 203,053 |
Health insurer fee revenue | 81,158 | 29,427 | 202,996 | 67,785 |
Investment income | 4,832 | 2,041 | 11,675 | 5,615 |
Other revenue | 1,745 | 2,327 | 4,996 | 8,523 |
Total revenue | 3,611,363 | 2,484,351 | 10,307,376 | 6,865,633 |
Operating expenses: | ||||
Medical care costs | 3,015,371 | 2,097,836 | 8,580,689 | 5,753,793 |
Cost of service revenue | 34,573 | 40,067 | 103,294 | 117,831 |
General and administrative expenses | 287,691 | 178,879 | 830,277 | 560,205 |
Premium tax expenses | 99,047 | 81,240 | 289,003 | 203,053 |
Health insurer fee expenses | 35,985 | 22,308 | 117,415 | 66,443 |
Depreciation and amortization | 25,843 | 24,242 | 75,987 | 67,835 |
Total operating expenses | 3,498,510 | 2,444,572 | 9,996,665 | 6,769,160 |
Operating income | 112,853 | 39,779 | 310,711 | 96,473 |
Other expenses, net: | ||||
Interest expense | 15,269 | 14,419 | 45,091 | 42,234 |
Other (income) expense, net | (40) | 863 | (82) | 810 |
Total other expenses, net | 15,229 | 15,282 | 45,009 | 43,044 |
Income from continuing operations before income tax expense | 97,624 | 24,497 | 265,702 | 53,429 |
Income tax expense | 51,329 | 8,427 | 152,335 | 24,784 |
Income from continuing operations | 46,295 | 16,070 | 113,367 | 28,645 |
Income (loss) from discontinued operations, net of tax | 4 | 52 | 28 | (214) |
Net income | $ 46,299 | $ 16,122 | $ 113,395 | $ 28,431 |
Basic net income (loss) per share: | ||||
Continuing operations (in dollars per share) | $ 0.84 | $ 0.34 | $ 2.21 | $ 0.62 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | (0.01) |
Basic net income per share (in dollars per share) | 0.84 | 0.34 | 2.21 | 0.61 |
Diluted net income (loss) per share: | ||||
Continuing operations (in dollars per share) | 0.77 | 0.33 | 2.07 | 0.60 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | (0.01) |
Diluted net income per share (in dollars per share) | $ 0.77 | $ 0.33 | $ 2.07 | $ 0.59 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 46,299 | $ 16,122 | $ 113,395 | $ 28,431 |
Other comprehensive income (loss): | ||||
Unrealized investment gain (loss) | 1,792 | (1,061) | 531 | 756 |
Effect of income taxes | 663 | (404) | 213 | 287 |
Other comprehensive income (loss), net of tax | 1,129 | (657) | 318 | 469 |
Comprehensive income | $ 47,428 | $ 15,465 | $ 113,713 | $ 28,900 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Operating activities: | ||
Net income | $ 113,395 | $ 28,431 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 92,583 | 99,464 |
Deferred income taxes | (12,072) | (10,705) |
Share-based compensation | 16,226 | 16,115 |
Amortization of convertible senior notes and lease financing obligations | 22,101 | 20,195 |
Other, net | 13,212 | 3,875 |
Changes in operating assets and liabilities: | ||
Receivables | (23,429) | (126,748) |
Prepaid expenses and other assets | (63,312) | (51,582) |
Medical claims and benefits payable | 359,048 | 454,059 |
Amounts due government agencies | 453,124 | 340,775 |
Accounts payable and accrued liabilities | 33,541 | (26,384) |
Deferred revenue | (128,849) | 68,640 |
Income taxes | 30,218 | 25,063 |
Net cash provided by operating activities | 905,786 | 841,198 |
Investing activities: | ||
Purchases of investments | (1,311,231) | (616,324) |
Proceeds from sales and maturities of investments | 862,572 | 473,836 |
Purchases of property, equipment and capitalized software | (100,361) | (71,771) |
Increase in restricted investments | (5,216) | (24,301) |
Net cash paid in business combinations | (77,316) | (7,500) |
Other, net | (33,523) | (15,220) |
Net cash used in investing activities | (665,075) | (261,280) |
Financing activities: | ||
Proceeds from common stock offering, net of issuance costs | 373,151 | 0 |
Proceeds from issuance of convertible senior notes, net of issuance costs | 0 | 123,387 |
Contingent consideration liabilities settled | 0 | (50,349) |
Proceeds from employee stock plans | 8,636 | 7,628 |
Other, net | 2,649 | 2,117 |
Net cash provided by financing activities | 384,436 | 82,783 |
Net increase in cash and cash equivalents | 625,147 | 662,701 |
Cash and cash equivalents at beginning of period | 1,539,063 | 935,895 |
Cash and cash equivalents at end of period | 2,164,210 | 1,598,596 |
Schedule of non-cash investing and financing activities: | ||
3.75% Notes exchanged for 1.625% Notes | 0 | 176,551 |
Increase in non-cash lease financing obligation – related party | 0 | 13,841 |
Common stock used for share-based compensation | (9,012) | (8,595) |
Details of change in fair value of derivatives, net: | ||
Change in fair value of derivatives, net | 18 | 8 |
Details of business combinations: | ||
Fair value of assets acquired | (68,982) | (7,500) |
Fair value of contingent consideration incurred | (410) | 0 |
Payable to seller | (7,924) | 0 |
Net cash paid in business combinations | (77,316) | (7,500) |
Gain on 1.125% Call Option | ||
Details of change in fair value of derivatives, net: | ||
Change in fair value of derivatives, net | 160,764 | 36,646 |
Loss on 1.125% Conversion Option | ||
Details of change in fair value of derivatives, net: | ||
Change in fair value of derivatives, net | $ (160,746) | $ (36,638) |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Organization and Operations Molina Healthcare, Inc. provides quality health care to persons receiving government assistance. We offer cost-effective Medicaid-related solutions to meet the health care needs of low-income families and individuals, and to assist government agencies in their administration of the Medicaid program. We report our financial performance based on two reportable segments: the Health Plans segment and the Molina Medicaid Solutions segment. Our Health Plans segment consists of health plans in 11 states and the Commonwealth of Puerto Rico, and includes our direct delivery business. As of September 30, 2015 , these health plans served 3.5 million members eligible for Medicaid, Medicare, and other government-sponsored health care programs for low-income families and individuals. Additionally, we serve Health Insurance Marketplace (Marketplace) members, many of whom are eligible for government premium subsidies. The health plans are operated by our respective wholly owned subsidiaries in those states, each of which is licensed as a health maintenance organization (HMO). Our direct delivery business consists primarily of the operation of primary care clinics in several states in which we operate, as well as the management of a hospital in southern California under a management services agreement. Our Molina Medicaid Solutions segment provides business processing and information technology development and administrative services to Medicaid agencies in Idaho, Louisiana, Maine, New Jersey, West Virginia, and the U.S. Virgin Islands, and drug rebate administration services in Florida. Market Updates - Health Plans Segment Direct Delivery. On September 3, 2015, we entered into an agreement to acquire all the outstanding ownership interests in Providence Human Services, LLC (PHS) and Providence Community Services, LLC, both wholly owned subsidiaries of The Providence Service Corporation, for approximately $200 million . PHS is one of the largest national providers of accessible, outcome-based behavioral and mental health services and operates in 23 states and the District of Columbia. Subject to regulatory approvals and the satisfaction of other closing conditions, we expect the transaction to close during the fourth quarter of 2015. Medicare-Medicaid Plans . To coordinate care for those who qualify to receive both Medicare and Medicaid services (the "dual eligible"), and to deliver services to the dual eligible in a more financially efficient manner, some states have undertaken demonstration programs to integrate Medicare and Medicaid services for dual eligible individuals. The health plans participating in such demonstrations are referred to as Medicare-Medicaid Plans (MMPs). We operate MMPs in six states. Our MMPs in California, Illinois, and Ohio offered coverage beginning in 2014; our MMPs in South Carolina and Texas offered coverage beginning in the first quarter of 2015; and our MMP in Michigan offered coverage beginning in the second quarter of 2015. At September 30, 2015, our membership included approximately 56,000 integrated MMP members. Florida. On August 3, 2015, we announced that our Florida health plan entered into an agreement with Integral Health Plan, Inc. (Integral) to assume Integral's Medicaid contract, as well as acquire certain assets related to the operations of its Medicaid business. As of August 3, 2015, Integral served approximately 90,000 Medicaid members. Subject to regulatory approvals and the satisfaction of other closing conditions, we expect the transaction to close during the fourth quarter of 2015. On August 1, 2015, our Florida health plan closed on its acquisition of the Medicaid contracts in Miami-Dade and Monroe counties, and certain assets related to the operation of the Medicaid business, of Preferred Medical Plan, Inc. The Florida health plan added approximately 23,000 members as a result of this transaction. See Note 4 , " Business Combinations ," for further information. As of September 30, 2015 , our Florida health plan served 148,000 Marketplace members, more than double its total membership as of December 31, 2014. Illinois. On October 9, 2015, we announced that our Illinois health plan entered into an agreement with Loyola Physician Partners, LLC (Loyola). Under this agreement, we will receive the right to transition Loyola's Medicaid members in Cook County and assume certain assets related to the operation of its Medicaid business. Loyola serves approximately 20,000 members in the Medicaid Family Health program in Cook County. Subject to regulatory approvals and the satisfaction of other closing conditions, we expect the transaction to close during the first quarter of 2016. On July 15, 2015, we announced that our Illinois health plan entered into an agreement with Accountable Care Chicago, LLC, also known as MyCare Chicago. Under this agreement, we will receive the right to assume MyCare Chicago's Medicaid members in Cook County, as well as acquire certain assets related to the operation of its Medicaid business. As of July 15, 2015, MyCare Chicago served approximately 61,000 Medicaid members. Subject to regulatory approvals and the satisfaction of other closing conditions, we expect the transaction to close during the first quarter of 2016. Michigan. On October 13, 2015, the Michigan Department of Health and Human Services announced that Molina Healthcare of Michigan, Inc. is one of the health plans recommended to serve the state's Medicaid members under Michigan's Comprehensive Health Plan expected to commence effective January 1, 2016. The new contract has a five -year term with three one -year extensions, and covers Regions 2 through 6, and 8 through 10, of the state, representing an expansion into 15 additional counties as compared to the existing Michigan Medicaid contract. On September 1, 2015, our Michigan health plan closed on its acquisition of the Medicaid and MIChild contracts, and certain provider agreements, of HealthPlus of Michigan and its subsidiary, HealthPlus Partners, Inc. The Michigan health plan added approximately 88,000 members as a result of this transaction. See Note 4 , " Business Combinations ," for further information. Puerto Rico. Effective April 1, 2015, our Puerto Rico health plan served its first members. As of September 30, 2015 , our Puerto Rico plan enrollment amounted to approximately 356,000 members. Market Updates - Molina Medicaid Solutions Segment New Jersey. On April 9, 2015, the state of New Jersey announced its selection of Molina Medicaid Solutions to design and operate that state's new Medicaid management information system (MMIS). The new contract is effective May 1, 2015, and has a term of 10 years with three one -year renewal options. Molina Medicaid Solutions is the state's incumbent MMIS provider, and was awarded the new contract as a result of Molina Medicaid Solutions' submission in response to the state of New Jersey's request for proposals. Consolidation and Interim Financial Information The consolidated financial statements include the accounts of Molina Healthcare, Inc., its subsidiaries, and variable interest entities (VIEs) in which Molina Healthcare, Inc. is considered to be the primary beneficiary. Such VIEs are insignificant to our consolidated financial position and results of operations. In the opinion of management, all adjustments considered necessary for a fair presentation of the results as of the date and for the interim periods presented have been included; such adjustments consist of normal recurring adjustments. All significant intercompany balances and transactions have been eliminated. The consolidated results of operations for the current interim period are not necessarily indicative of the results for the entire year ending December 31, 2015 . The unaudited consolidated interim financial statements have been prepared under the assumption that users of the interim financial data have either read or have access to our audited consolidated financial statements for the fiscal year ended December 31, 2014 . Accordingly, certain disclosures that would substantially duplicate the disclosures contained in the December 31, 2014 audited consolidated financial statements have been omitted. These unaudited consolidated interim financial statements should be read in conjunction with our December 31, 2014 audited consolidated financial statements. Reclassifications We have reclassified certain amounts in the 2014 statement of cash flows to conform to the 2015 presentation. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Revenue Recognition Premium Revenue – Health Plans Segment Premium revenue is fixed in advance of the periods covered and, except as described below, is not generally subject to significant accounting estimates. Premium revenues are recognized in the month that members are entitled to receive health care services, and premiums collected in advance are deferred. Certain components of premium revenue are subject to accounting estimates as follows: Contractual Provisions That May Adjust or Limit Revenue or Profit Medicaid Medical Cost Floors (Minimums), Medical Cost Corridors, and Administrative Cost Ceilings (Maximums): A portion of certain premiums received by our health plans may be returned if certain minimum amounts are not spent on defined medical care costs. In the aggregate, we recorded a liability under the terms of such contract provisions of $536.5 million and $392.0 million at September 30, 2015 and December 31, 2014 , respectively, to amounts due government agencies. Approximately $523.2 million of the liability accrued at September 30, 2015 relates to our participation in Medicaid expansion programs. In general, such amounts are subject to future changes in estimate based upon our actual cost performance and clarification and alteration of the definitions of allowable medical costs and revenue. At our Washington health plan (where we had recorded a liability of approximately $280 million related to the Medicaid expansion medical cost floor for 2014 and 2015 combined at September 30, 2015 ), premium revenue may be retroactively adjusted across the entire state Medicaid expansion program based upon the medical cost performance of the program as a whole. As such, our liability under Washington’s contractual provisions is determined not just by our own medical cost performance, but by that of all health plans participating in the program; and we have limited visibility into the costs of those health plans. In October 2015, we settled our 2014 Medicaid expansion medical cost floor liability with the state of Washington with the payment of $246.6 million . This amount exceeded our estimate of that liability as of June 30, 2015 by approximately $7 million . In certain circumstances, the health plans may receive additional premiums if amounts spent on medical care costs exceed a defined maximum threshold. We had $9.2 million recorded at September 30, 2015 relating to such provisions. No such receivables were recorded at December 31, 2014 . Profit Sharing and Profit Ceiling: Our contracts with certain states contain profit-sharing or profit ceiling provisions under which we refund amounts to the states if our health plans generate profit above a certain specified percentage, in some cases in accordance with a tiered rebate schedule. In some cases, we are limited in the amount of administrative costs that we may deduct in calculating the refund, if any. As a result of profits in excess of the amount we are allowed to retain, we recorded a liability of $9.3 million and $0.5 million at September 30, 2015 and December 31, 2014 , respectively. Retroactive Premium Adjustments: In New Mexico, when members are retroactively enrolled into our health plan we earn revenue only to the extent of the actual medical costs incurred by us for services provided during those retroactive periods, plus a small percentage of that medical cost for administration and profit. This cost plus arrangement for members retroactively enrolled in our health plan first became effective July 1, 2014 (retroactive to January 1, 2014). We are paid normal monthly capitation rates for the retroactive eligibility periods, and the difference between those capitation rates and the amounts due us on a cost plus basis are periodically settled with the state. To date, no such settlement has been made with the state. Our New Mexico contract is not specific as to the definition of retroactive membership, and the amount we owe back to the state for the difference between capitation received and amounts due us under the cost plus arrangement varies widely depending upon the definition of retroactive membership. In August 2015 the state provided us with a request for payment under the terms of this contract provision for the period January 1, 2014 through December 31, 2014. That request was based upon definitions of retroactive membership that were at odds with our interpretations of that term. The New Mexico health plan reduced revenue by approximately $20 million in the third quarter of 2015 to better align our interpretation of certain contractual provisions related to revenue for members added retroactively to the state’s interpretation of those provisions. Even after that adjustment, however, we estimate that, based upon our interpretation of the state’s proposed definition of retroactive membership, the amount we would owe for the period January 1, 2014 through September, 2015 would exceed our accrual for such liability at September 30, 2015 by between $15 million and $20 million. We are currently engaged in discussions with the state regarding the appropriate amount, if any, owed to the state under this contract term. Medicare Risk Adjustment: Based on member encounter data that we submit to the Centers for Medicare and Medicaid Services (CMS), our Medicare premiums are subject to retroactive increase or decrease based upon member medical conditions for up to two years after the original year of service. We estimate the amount of Medicare revenue that will ultimately be realized for the periods presented based on our knowledge of our members’ health care utilization patterns and CMS practices. Based on our knowledge of member health care utilization patterns and expenses, we have recorded a net receivable of $2.3 million and $7.6 million for anticipated Medicare risk adjustment premiums at September 30, 2015 and December 31, 2014 , respectively. Marketplace Premium Stabilization Programs: The Affordable Care Act (ACA) established Marketplace premium stabilization programs effective January 1, 2014. These programs, commonly referred to as the "3R's," include a permanent risk adjustment program, a transitional reinsurance program, and a temporary risk corridor program. We record receivables or payables related to the 3R programs based on our year-to-date experience when the amounts are reasonably estimable, and, for receivables, collection is reasonably assured. • Permanent risk adjustment program: Under this permanent program, our health plans' risk scores are compared to the overall average risk score for the relevant state and market pool. Generally, our health plans will pay into the pool if their risk scores are below the average risk score, and will receive funds from the pool if their risk scores are above the average risk score. • Transitional reinsurance program: This program is designed to provide reimbursement to insurers for high cost members. Our health plans pay an annual contribution on a per-member basis, and are eligible for recoveries if claims for individual members exceed a specified threshold, up to a maximum amount. This three-year program will end in 2016. • Temporary risk corridor program: This program is intended to limit gains and losses of insurers by comparing allowable costs to a target amount as defined by the U.S. Department of Health and Human Services (HHS). Variances from the target amount exceeding certain thresholds may result in amounts due to or receivable from HHS. This three-year program will end in 2016. Due to uncertainties as to the amount of federal funding available to support the risk corridor program, we do not recognize amounts receivable under this program. All liabilities are recognized as incurred. Additionally, the ACA established a minimum annual medical loss ratio (Minimum MLR) of 80% for the Marketplace. The medical loss ratio represents medical costs as a percentage of premium revenue, where the components of medical costs and premium revenue are specifically defined by federal regulations. Each of the 3R programs is taken into consideration when computing the Minimum MLR. If the Minimum MLR is not met, we may be required to pay rebates to our Marketplace policyholders. Our receivables (payables) for each of these programs, as of the dates indicated, were as follows (in millions): September 30, 2015 December 31, 2014 Risk adjustment $ (136.1 ) $ (4.8 ) Reinsurance 21.9 4.9 Risk corridor (11.8 ) (0.5 ) Minimum MLR (12.5 ) — Quality Incentives At our California, Illinois, New Mexico, Ohio, South Carolina, Texas, Washington and Wisconsin health plans, revenue ranging from approximately 1% to 4% of certain health plan premiums is not earned unless specified performance measures are met. The following table quantifies the quality incentive premium revenue recognized for the periods presented, including the amounts earned in the period presented and prior periods. Although the reasonably possible effects of a change in estimate related to quality incentive premium revenue as of September 30, 2015 are not known, we have no reason to believe that the adjustments to prior years noted below are not indicative of the potential future changes in our estimates as of September 30, 2015 . Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (In thousands) Maximum available quality incentive premium - current period $ 28,384 $ 24,477 $ 86,529 $ 68,941 Amount of quality incentive premium revenue recognized in current period: Earned current period $ 17,073 $ 12,921 $ 37,849 $ 30,935 Earned prior periods (609 ) 208 10,862 3,412 Total $ 16,464 $ 13,129 $ 48,711 34,347 Total premium revenue recognized for state health plans with quality incentive premiums $ 2,517,474 $ 1,818,375 $ 7,396,280 $ 5,005,444 California Health Plan Rate Settlement Agreement In 2013, our California health plan entered into a settlement agreement with the California Department of Health Care Services (DHCS). The agreement settled rate disputes initiated by our California health plan dating back to 2003 with respect to its participation in Medi-Cal (California’s Medicaid program). Under the terms of the agreement, DHCS may be required to make a payment to us if the California health plan's pre-tax margin falls below certain levels. The maximum amount that DHCS would pay to us under the terms of the settlement agreement is $40.0 million ; no amounts receivable were recorded related to this agreement at September 30, 2015 or December 31, 2014 . The agreement expires effective December 31, 2017. Income Taxes The provision for income taxes is determined using an estimated annual effective tax rate, which is generally greater than the U.S. federal statutory rate primarily because of state taxes, nondeductible expenses under the Affordable Care Act Health Insurer Fee (HIF), nondeductible compensation and other general and administrative expenses. The effective tax rate may be subject to fluctuations during the year, particularly as a result of the level of pretax earnings, and also as new information is obtained. Such information may affect the assumptions used to estimate the annual effective tax rate, including factors such as the mix of pretax earnings in the various tax jurisdictions in which we operate, valuation allowances against deferred tax assets, the recognition or the reversal of the recognition of tax benefits related to uncertain tax positions, and changes in or the interpretation of tax laws in jurisdictions where we conduct business. We recognize deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of our assets and liabilities, along with net operating loss and tax credit carryovers. New Accounting Standards Business Combinations. In September 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-16, Simplifying the Accounting for Measurement-Period Adjustments , which will require that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period (a reasonable time period after the acquisition date) in the reporting period in which the adjustment amounts are determined. Effective for us in the first quarter of 2016, ASU 2015-16 is applied prospectively. Revenue Recognition. On July 9, 2015, the FASB affirmed its proposal to defer the effective date of ASU No. 2014-09, Revenue from Contracts with Customers, for all entities by one year. As a result, public business entities will apply the new revenue standard to annual reporting periods beginning after December 15, 2017, and for interim reporting periods within annual reporting periods beginning after December 15, 2017. We continue to evaluate whether to elect the full or modified retrospective adoption method, and the potential effects to our financial statements. Short-Duration Contracts. In May 2015, the FASB issued ASU 2015-09, Disclosures about Short-Duration Contracts , which will require additional disclosure on the liability for unpaid claims and claim adjustment expenses. Effective for us in the first quarter of 2016, ASU 2015-09 is applied retrospectively to all prior periods presented in the financial statements. Early adoption is permitted; we are evaluating the potential effects of the adoption to our financial statements. Debt Issuance Costs. In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs , which will require debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of such debt liability, consistent with debt discounts. In a subsequent Staff Announcement, the Securities and Exchange Commission (SEC) announced that it would not object to an entity deferring and presenting debt issuance costs relating to a line-of-credit arrangement as an asset. This Staff Announcement was incorporated by the FASB through ASU 2015-15, issued in August 2015. Effective for us in the first quarter of 2016, ASU 2015-03 is applied retrospectively to all prior periods presented in the financial statements. Early adoption is permitted; we are evaluating the potential effects of the adoption to our financial statements. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the SEC did not have, or are not believed by management to have, a material impact on our present or future consolidated financial statements. |
Net Income per Share
Net Income per Share | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Net Income per Share | Net Income per Share The following table sets forth the calculation of the denominators used to compute basic and diluted net income per share: Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (In thousands) Shares outstanding at the beginning of the period 54,788 46,494 48,578 45,871 Weighted-average number of shares issued: Common stock offering — — 2,393 — Issued, 3.75% Notes and 3.75% Exchange (1) — 460 — 155 Share-based compensation 15 37 295 409 Denominator for basic net income per share 54,803 46,991 51,266 46,435 Effect of dilutive securities: Share-based compensation 353 365 417 441 Convertible senior notes (1) 1,126 1,288 602 1,212 1.125% Warrants (1) 3,696 — 2,414 — Denominator for diluted net income per share 59,978 48,644 54,699 48,088 Potentially dilutive common shares excluded from calculations (2): Restricted shares — — 3 — 1.125% Warrants — 13,490 — 13,490 ______________________________ (1) For more information regarding the convertible senior notes, refer to Note 11 , " Debt ." For more information regarding the 1.125% Warrants, refer to Note 12 , " Derivatives ." (2) The dilutive effect of all potentially dilutive common shares is calculated using the treasury-stock method. Certain potentially dilutive common shares issuable are not included in the computation of diluted net income per share because to do so would be anti-dilutive. For the three and nine months ended September 30, 2014 , the 1.125% Warrants were excluded from diluted shares outstanding because the exercise price exceeded the average market price of our common stock. |
Business Combinations
Business Combinations | 9 Months Ended |
Sep. 30, 2015 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations Health Plans Segment Florida. On August 1, 2015, our Florida health plan closed on its acquisition of the Medicaid contracts in Miami-Dade and Monroe counties, and certain assets related to the operation of the Medicaid business, of Preferred Medical Plan, Inc. The final purchase price was $8.2 million , and the Florida health plan added approximately 23,000 members as a result of this transaction. In December 2014, our Florida health plan acquired certain assets relating to the Medicaid business of First Coast Advantage, LLC (FCA). Under this transaction, we assumed FCA's Medicaid contract and certain provider agreements for Region 4 of the Statewide Medicaid Managed Care Managed Medical Assistance Program in the state of Florida. The Florida health plan added approximately 62,000 members as a result of this transaction. The final purchase price was $44.6 million , of which $36.6 million was paid in December 2014, and $8.0 million was paid in the first quarter of 2015. Michigan. On September 1, 2015, our Michigan health plan closed on its acquisition of the Medicaid and MIChild contracts, and certain provider agreements, of HealthPlus of Michigan and its subsidiary, HealthPlus Partners, Inc. The purchase price was $61.1 million , and the Michigan health plan added approximately 88,000 members as a result of this transaction. |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Share-Based Compensation As of September 30, 2015 , there were approximately 475,000 unvested restricted shares awarded to our named executive officers, with market and performance conditions, outstanding. In the event the vesting conditions are not achieved, the awards will lapse. Based on our assessment as of September 30, 2015 , we expect the performance conditions relating to approximately 297,000 of such restricted share awards to be met in full. For the remaining 178,000 unvested restricted share awards, we reversed share-based compensation expense recognized from inception through March 31, 2015, or approximately $2.6 million , in the second quarter of 2015. Charged to general and administrative expenses, total share-based compensation expense was as follows: Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (In thousands) Restricted stock and performance awards $ 5,707 $ 4,774 $ 12,962 $ 13,596 Employee stock purchase plan and stock options 1,278 885 3,264 2,519 $ 6,985 $ 5,659 $ 16,226 $ 16,115 As of September 30, 2015 , there was $30.1 million of total unrecognized compensation expense related to unvested restricted stock awards, including those with performance conditions, which we expect to recognize over a remaining weighted-average period of 1.6 years . Restricted and performance stock activity for the nine months ended September 30, 2015 is summarized below: Shares Weighted Average Grant Date Fair Value Unvested balance as of December 31, 2014 1,282,072 $ 33.55 Granted 428,223 64.25 Vested (397,115 ) 33.39 Forfeited (47,759 ) 37.51 Unvested balance as of September 30, 2015 1,265,421 43.84 The total fair value of restricted and performance awards granted during the nine months ended September 30, 2015 and 2014 was $27.9 million and $24.8 million , respectively. The total fair value of restricted awards, including those with performance and market conditions, which vested during the nine months ended September 30, 2015 and 2014 was $25.2 million and $22.5 million , respectively. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We consider the carrying amounts of cash and cash equivalents and other current assets and current liabilities (not including derivatives and current portion of long-term debt) to approximate their fair values because of the relatively short period of time between the origination of these instruments and their expected realization or payment. For our financial instruments measured at fair value on a recurring basis, we prioritize the inputs used in measuring fair value according to a three-tier fair value hierarchy as follows: Level 1 — Observable Inputs Level 1 financial instruments are actively traded and therefore the fair value for these securities is based on quoted market prices on one or more securities exchanges. Level 2 — Directly or Indirectly Observable Inputs Level 2 financial instruments are traded frequently though not necessarily daily. Fair value for these investments is determined using a market approach based on quoted prices for similar securities in active markets or quoted prices for identical securities in inactive markets. Level 3 — Unobservable Inputs Level 3 financial instruments are valued using unobservable inputs that represent management's best estimate of what market participants would use in pricing the financial instrument at the measurement date. Our Level 3 financial instruments include the following: Derivative financial instruments . Derivative financial instruments include the 1.125% Call Option derivative asset and the 1.125% Conversion Option derivative liability. These derivatives are not actively traded and are valued based on an option pricing model that uses observable and unobservable market data for inputs. Significant market data inputs used to determine fair value as of September 30, 2015 included the price of our common stock, the time to maturity of the derivative instruments, the risk-free interest rate, and the implied volatility of our common stock. As described further in Note 12 , “ Derivatives ,” the 1.125% Call Option asset and the 1.125% Conversion Option liability were designed such that changes in their fair values would offset, with minimal impact to the consolidated statements of income. Therefore, the sensitivity of changes in the unobservable inputs to the option pricing model for such instruments is mitigated. Contingent consideration liability . The contingent consideration liability represents the remaining liability associated with the Medicare-Medicaid Plan (MMP) component of our South Carolina health plan acquisition in 2013, and is recorded in accounts payable and accrued liabilities. We applied a cash flow analysis to determine the fair value of this liability. The significant unobservable input is the purchase price estimate for the projected membership. Auction rate securities . Auction rate securities are designated as available-for-sale and are reported at fair value in other assets. To estimate the fair value of these securities, we use valuation data from our primary pricing source, a third party who provides a marketplace for illiquid assets with over 10,000 participants. This valuation data is based on a range of prices that represent indicative bids from potential buyers. To validate the reasonableness of the data, we compare these valuations to data from other third-party pricing sources, which also provide a range of prices representing indicative bids from potential buyers. We have concluded that these estimates, given the lack of market available pricing, provide a reasonable basis for determining the fair value of the auction rate securities as of September 30, 2015 . Our financial instruments measured at fair value on a recurring basis at September 30, 2015 , were as follows: Total Level 1 Level 2 Level 3 (In thousands) Corporate debt securities $ 938,284 $ — $ 938,284 $ — Municipal securities 201,921 — 201,921 — GSEs 133,624 133,624 — — U.S. treasury notes 74,943 74,943 — — Certificates of deposit 84,593 — 84,593 — Asset-backed securities 27,282 — 27,282 — Mortgage-backed securities 820 — 820 — Subtotal - current investments 1,461,467 208,567 1,252,900 — Auction rate securities 2,355 — — 2,355 1.125% Call Option derivative asset 490,087 — — 490,087 Total assets measured at fair value on a recurring basis $ 1,953,909 $ 208,567 $ 1,252,900 $ 492,442 1.125% Conversion Option derivative liability $ 489,940 $ — $ — $ 489,940 Contingent consideration liability 500 — — 500 Total liabilities measured at fair value on a recurring basis $ 490,440 $ — $ — $ 490,440 Our financial instruments measured at fair value on a recurring basis at December 31, 2014 , were as follows: Total Level 1 Level 2 Level 3 (In thousands) Corporate debt securities $ 641,729 $ — $ 641,729 $ — Municipal securities 127,045 — 127,045 — GSEs 122,269 122,269 — — U.S. treasury notes 59,543 59,543 — — Certificates of deposit 68,876 — 68,876 — Subtotal - current investments 1,019,462 181,812 837,650 — Auction rate securities 4,847 — — 4,847 1.125% Call Option derivative asset 329,323 — — 329,323 Total assets measured at fair value on a recurring basis $ 1,353,632 $ 181,812 $ 837,650 $ 334,170 1.125% Conversion Option derivative liability $ 329,194 $ — $ — $ 329,194 Contingent consideration liability 500 — — 500 Total liabilities measured at fair value on a recurring basis $ 329,694 $ — $ — $ 329,694 The following table presents activity relating to our assets (liabilities) measured at fair value on a recurring basis using significant unobservable inputs (Level 3): Changes in Level 3 Instruments Auction Rate Securities Derivatives, Net Contingent Consideration Liability (In thousands) Balance at December 31, 2014 $ 4,847 $ 129 $ (500 ) Total gains for the period recognized in: Other expenses, net — 18 — Other comprehensive income 108 — — Settlements (2,600 ) — — Balance at September 30, 2015 $ 2,355 $ 147 $ (500 ) Fair Value Measurements – Disclosure Only The carrying amounts and estimated fair values of our convertible senior notes, which are classified as Level 2 financial instruments, are indicated in the following table. Fair value for these securities is determined using a market approach based on quoted prices for similar securities in active markets or quoted prices for identical securities in inactive markets. September 30, 2015 Carrying Value Total Fair Value Level 1 Level 2 Level 3 (In thousands) 1.125% Notes $ 450,304 $ 960,515 $ — $ 960,515 $ — 1.625% Notes 275,050 393,099 — 393,099 — $ 725,354 $ 1,353,614 $ — $ 1,353,614 $ — December 31, 2014 Carrying Value Total Fair Value Level 1 Level 2 Level 3 (In thousands) 1.125% Notes $ 435,330 $ 767,377 $ — $ 767,377 $ — 1.625% Notes 268,767 337,292 — 337,292 — $ 704,097 $ 1,104,669 $ — $ 1,104,669 $ — |
Investments
Investments | 9 Months Ended |
Sep. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments The following tables summarize our investments as of the dates indicated: September 30, 2015 Amortized Gross Unrealized Estimated Fair Cost Gains Losses Value (In thousands) Corporate debt securities $ 939,611 $ 668 $ 1,995 $ 938,284 Municipal securities 201,876 317 272 201,921 GSEs 133,528 126 30 133,624 U.S. treasury notes 74,724 219 — 74,943 Certificates of deposit 84,615 4 26 84,593 Asset-backed securities 27,265 24 7 27,282 Mortgage-backed securities 817 3 — 820 Subtotal - current investments 1,462,436 1,361 2,330 1,461,467 Auction rate securities 2,500 — 145 2,355 $ 1,464,936 $ 1,361 $ 2,475 $ 1,463,822 December 31, 2014 Amortized Gross Unrealized Estimated Fair Cost Gains Losses Value (In thousands) Corporate debt securities $ 642,910 $ 201 $ 1,382 $ 641,729 Municipal securities 127,185 129 269 127,045 GSEs 122,317 34 82 122,269 U.S. treasury notes 59,546 30 33 59,543 Certificates of deposit 68,893 1 18 68,876 Subtotal - current investments 1,020,851 395 1,784 1,019,462 Auction rate securities 5,100 — 253 4,847 $ 1,025,951 $ 395 $ 2,037 $ 1,024,309 The contractual maturities of our investments as of September 30, 2015 are summarized below: Amortized Cost Estimated Fair Value (In thousands) Due in one year or less $ 659,930 $ 659,729 Due after one year through five years 771,762 770,930 Due after five years through ten years 30,744 30,808 Due after ten years 2,500 2,355 $ 1,464,936 $ 1,463,822 Gross realized gains and losses from sales of available-for-sale securities are calculated under the specific identification method and are included in investment income. Gross realized investment gains and losses for the three and nine months ended September 30, 2015 and 2014 were immaterial. We have determined that unrealized gains and losses on our investments at September 30, 2015 and December 31, 2014 , are temporary in nature, because the change in market value for these securities has resulted from fluctuating interest rates, rather than a deterioration of the credit worthiness of the issuers. So long as we hold these securities to maturity, we are unlikely to experience gains or losses. In the event that we dispose of these securities before maturity, we expect that realized gains or losses, if any, will be immaterial. The following table segregates those available-for-sale investments that have been in a continuous loss position for less than 12 months, and those that have been in a loss position for 12 months or more as of September 30, 2015 : In a Continuous Loss Position for Less than 12 Months In a Continuous Loss Position for 12 Months or More Estimated Fair Value Unrealized Losses Total Number of Positions Estimated Fair Value Unrealized Losses Total Number of Positions (Dollars in thousands) Corporate debt securities $ 408,736 $ 1,611 300 $ 136,776 $ 384 80 Municipal securities 88,681 190 110 12,155 82 15 GSEs 51,393 30 17 — — — Certificates of deposit 35,654 26 148 — — — Asset-backed securities 16,689 7 20 — — — Auction rate securities — — — 2,355 145 3 $ 601,153 $ 1,864 595 $ 151,286 $ 611 98 The following table segregates those available-for-sale investments that have been in a continuous loss position for less than 12 months, and those that have been in a loss position for 12 months or more as of December 31, 2014 : In a Continuous Loss Position for Less than 12 Months In a Continuous Loss Position for 12 Months or More Estimated Fair Value Unrealized Losses Total Number of Positions Estimated Fair Value Unrealized Losses Total Number of Positions (Dollars in thousands) Corporate debt securities $ 379,034 $ 1,151 265 $ 28,668 $ 231 10 Municipal securities 53,626 168 64 11,075 101 13 GSEs 75,025 69 22 2,986 13 3 U.S. treasury notes 19,199 33 13 — — — Certificates of deposit 12,591 18 52 — — — Auction rate securities — — — 4,847 253 6 $ 539,475 $ 1,439 416 $ 47,576 $ 598 32 |
Receivables
Receivables | 9 Months Ended |
Sep. 30, 2015 | |
Receivables [Abstract] | |
Receivables | Receivables Receivables consist primarily of amounts due from government Medicaid agencies, which may be subject to potential retroactive adjustments. Because all of our receivable amounts are readily determinable and substantially all of our creditors are governmental authorities, our allowance for doubtful accounts is immaterial. September 30, December 31, (In thousands) California $ 108,972 $ 310,938 Florida 23,096 2,141 Illinois 78,159 31,594 Michigan 49,348 19,880 New Mexico 87,493 49,609 Ohio 102,786 45,187 Puerto Rico 14,430 — South Carolina 6,626 4,134 Texas 41,531 29,348 Utah 11,595 6,389 Washington 38,999 42,848 Wisconsin 26,530 8,102 Direct delivery and other 5,761 11,295 Total Health Plans segment 595,326 561,465 Molina Medicaid Solutions segment 24,565 34,991 $ 619,891 $ 596,456 |
Restricted Investments
Restricted Investments | 9 Months Ended |
Sep. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Restricted Investments | Restricted Investments Pursuant to the regulations governing our Health Plans segment subsidiaries, we maintain statutory deposits and deposits required by government authorities in certificates of deposit and U.S. treasury securities. We also maintain restricted investments as protection against the insolvency of certain capitated providers. In connection with a Molina Medicaid Solutions segment state contract as of December 31, 2014, we maintained restricted investments as collateral for a letter of credit. The following table presents the balances of restricted investments: September 30, December 31, (In thousands) California $ 373 $ 373 Florida 27,029 28,649 Illinois 311 311 Michigan 1,014 1,014 New Mexico 42,645 35,135 Ohio 11,726 12,719 Puerto Rico 10,098 5,097 South Carolina 310 6,040 Texas 3,502 3,500 Utah 3,616 3,601 Washington 151 151 Wisconsin 953 — Other 242 888 Total Health Plans segment 101,970 97,478 Molina Medicaid Solutions segment — 5,001 $ 101,970 $ 102,479 The contractual maturities of our held-to-maturity restricted investments as of September 30, 2015 are summarized below: Amortized Cost Estimated Fair Value (In thousands) Due in one year or less $ 91,518 $ 91,519 Due one year through five years 10,452 10,464 $ 101,970 $ 101,983 |
Medical Claims and Benefits Pay
Medical Claims and Benefits Payable | 9 Months Ended |
Sep. 30, 2015 | |
Other Liabilities Disclosure [Abstract] | |
Medical Claims and Benefits Payable | Medical Claims and Benefits Payable The following table provides the details of our medical claims and benefits payable (including amounts payable for the provision of long-term services and supports, or LTSS) as of the dates indicated. September 30, December 31, (In thousands) Fee-for-service claims incurred but not paid (IBNP) $ 1,184,147 $ 870,429 Pharmacy payable 93,953 71,412 Capitation payable 30,061 28,150 Other 251,409 230,531 $ 1,559,570 $ 1,200,522 "Other" medical claims and benefits payable include amounts payable to certain providers for which we act as an intermediary on behalf of various government agencies without assuming financial risk. Such receipts and payments do not impact our consolidated statements of income. Non-risk provider payables amounted to $161.4 million and $119.3 million as of September 30, 2015 and December 31, 2014 , respectively. The following table presents the components of the change in our medical claims and benefits payable from continuing and discontinued operations combined for the periods indicated. The amounts presented for “Components of medical care costs related to: Prior periods” represent the amount by which our original estimate of medical 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. Nine Months Ended Year Ended September 30, 2015 December 31, 2014 (Dollars in thousands) Medical claims and benefits payable, beginning balance $ 1,200,522 $ 669,787 Components of medical care costs related to: Current period 8,723,573 8,122,885 Prior periods (1) (142,948 ) (45,979 ) Total medical care costs 8,580,625 8,076,906 Change in non-risk provider payables 42,067 (31,973 ) Payments for medical care costs related to: Current period 7,371,504 7,064,427 Prior periods 892,140 449,771 Total paid 8,263,644 7,514,198 Medical claims and benefits payable, ending balance $ 1,559,570 $ 1,200,522 Benefit from prior period as a percentage of: Balance at beginning of period 11.9 % 6.9 % Premium revenue, trailing twelve months 1.2 % 0.5 % Medical care costs, trailing twelve months 1.3 % 0.6 % ____________________ (1) The benefit from prior period development of medical claims and benefits payable for the nine months ended September 30, 2015 included approximately $23 million relating to programs that contain medical cost floor or corridor provisions. Accordingly, premium revenue for the nine months ended September 30, 2015 was reduced by the same amount. The portion of our total medical claims and benefits payable liability that is most subject to variability in the estimate is fee-for-service claims incurred but not paid (IBNP). IBNP represents our best estimate of the total amount of claims we will ultimately pay with respect to claims that we have incurred as of the balance sheet date. We estimate our IBNP monthly using actuarial methods based on a number of factors. Assuming that our initial estimate of IBNP is accurate, we believe that amounts ultimately paid out would generally be between 8% and 10% less than the IBNP liability recorded at the end of the period as a result of the inclusion in that liability of the provision for adverse claims deviation and the accrued cost of settling those claims. Because the amount of our initial liability is merely an estimate (and therefore not perfectly accurate), we will always experience variability in that estimate as new information becomes available with the passage of time. Therefore, there can be no assurance that amounts ultimately paid out will fall within the range of 8% to 10% lower than the liability that was initially recorded. Furthermore, because our initial estimate of IBNP is derived from many factors, some of which are qualitative in nature rather than quantitative, we are seldom able to assign specific values to the reasons for a change in estimate – we only know when the circumstances for any one or more factors are out of the ordinary. The use of a consistent methodology in estimating our liability for medical claims and benefits payable minimizes the degree to which the under– or overestimation of that liability at the close of one period may affect consolidated results of operations in subsequent periods. In particular, the use of a consistent methodology should result in the replenishment of reserves during any given period in a manner that generally offsets the benefit of favorable prior period development in that period. Facts and circumstances unique to the estimation process at any single date, however, may still lead to a material impact on consolidated results of operations in subsequent periods. Any absence of adverse claims development (as well as the expensing through general and administrative expense of the costs to settle claims held at the start of the period) will lead to the recognition of a benefit from prior period claims development in the period subsequent to the date of the original estimate. As indicated above, the amounts ultimately paid out on our medical claims and benefits payable liabilities in fiscal years 2015 and 2014 were less than what we had expected when we had established those liabilities. The differences between our original estimates and the amounts ultimately paid out (or now expected to be ultimately paid out) for the most part related to IBNP. While many related factors working in conjunction with one another determine the accuracy of our estimates, we are seldom able to quantify the impact that any single factor has on a change in estimate. In addition, given the variability inherent in the reserving process, we will only be able to identify specific factors if they represent a significant departure from expectations. As a result, we do not expect to be able to fully quantify the impact of individual factors on changes in estimates. We believe that the most significant uncertainties surrounding our IBNP estimates at September 30, 2015 are as follows: • At our Illinois and Wisconsin health plans, we overpaid certain outpatient facility claims due to a system configuration error. For this reason, the reserves are subject to more than the usual amount of uncertainty. • At our Washington health plan, delays related to the implementation of revised fee schedules resulted in a significant increase to our outpatient claims inventory in the first quarter of 2015, followed by a reduction in inventory during the second quarter of 2015. This significant fluctuation in inventory adds to the uncertainty of our unpaid claims estimates. • Our Michigan health plan added approximately 88,000 new members through an acquisition in the third quarter of 2015. Because these new members may have different utilization patterns than our legacy members, the reserves are subject to more than the usual amount of uncertainty. • Our Texas health plan enrolled approximately 15,000 members to its new MMP (Medicare-Medicaid Program) in the second and third quarters of 2015. Because we lack sufficient historical claims data, we are estimating the reserves for these new members by applying an estimated medical care ratio (MCR) based upon the assumptions supporting our premium rates. Because estimating incurred claims in this way is not directly tied to the actual claims experience, the reserves are subject to more than the usual amount of uncertainty. We recognized favorable prior period claims development in the amount of $142.9 million for the nine months ended September 30, 2015 . This amount represents our estimate as of September 30, 2015 , of the extent to which our initial estimate of medical claims and benefits payable at December 31, 2014 was more than the amount that will ultimately be paid out in satisfaction of that liability. We believe the overestimation was due primarily to the following factors: • At our Ohio and California health plans, approximately 61,000 and 100,000 members, respectively, were enrolled in the new Medicaid expansion program during 2014. Also in Ohio, approximately 17,000 members were enrolled in the new MMP program in 2014. Because we lacked sufficient historical claims data, we initially estimated the reserves for these new members based upon a number of factors that included pricing assumptions provided by the state; our expectations regarding pent up demand; our beliefs about the speed at which new members would utilize health care services; and other factors. Our actual costs were ultimately less than expected. • At our New Mexico health plan, the state implemented a retroactive increase to the provider fee schedules in mid-2014. As a result, many claims that were previously settled were reopened, and subject to, additional payment. Because our reserving methodology is most accurate when claims payment patterns are consistent and predictable, the payment of additional amounts on claims that in some cases had been settled more than six months before added a substantial degree of complexity to our liability estimation process. Due to the difficulties in addressing that added complexity, liabilities recorded as of December 31, 2014 were in excess of amounts ultimately paid out. • At our Washington health plan, in 2015 we collected amounts related to certain claims paid in 2013. Such collections were not anticipated in our reserves as of December 31, 2014. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Debt | Debt As of September 30, 2015 , contractual maturities of debt for the years ending December 31 are as follows (in thousands): Total 2015 2016 2017 2018 2019 Thereafter 1.125% Notes $ 550,000 $ — $ — $ — $ — $ — $ 550,000 1.625% Notes (1) 301,551 — — — — — 301,551 $ 851,551 $ — $ — $ — $ — $ — $ 851,551 (1) The 1.625% Notes have a contractual maturity date in 2044; however, on specified dates beginning in 2018 as described below, holders of the 1.625% Notes may require us to repurchase some or all of the 1.625% Notes, or we may redeem any or all of the 1.625% Notes. Credit Facility. On June 12, 2015, we entered into an unsecured $250 million revolving credit facility (Credit Facility) which will be used to finance working capital needs, acquisitions, capital expenditures, and other general corporate activities. The Credit Facility has a term of 5 years and all amounts outstanding will be due and payable on June 12, 2020. Subject to obtaining commitments from existing or new lenders and satisfaction of other specified conditions, we may increase the Credit Facility to up to $350 million . As of September 30, 2015 , a $5 million letter of credit outstanding reduced borrowing available to $245 million , and no amounts were outstanding under the Credit Facility. Borrowings under the Credit Facility bear interest based, at our election, on a base rate or an adjusted London Interbank Offered Rate (LIBOR), plus in each case the applicable margin. In addition to interest payable on the principal amount of indebtedness outstanding from time to time under the Credit Facility, we are required to pay a quarterly commitment fee. Although the Credit Facility is not secured by any of our assets, two of our wholly owned subsidiaries, Molina Medicaid Solutions and Molina Medical Management, Inc. (MMM), have jointly and severally guaranteed our obligations under the Credit Facility. The Credit Facility contains customary non-financial and financial covenants, including a minimum fixed charge coverage ratio, a maximum debt-to-EBITDA ratio and minimum statutory net worth. We are required to not exceed a maximum debt-to-EBITDA ratio of 4.00 to 1.00. At September 30, 2015 , we were in compliance with all financial covenants under the Credit Facility. 1.125% Cash Convertible Senior Notes due 2020. In February 2013, we issued $550.0 million aggregate principal amount of 1.125% cash convertible senior notes (the 1.125% Notes) due January 15, 2020, unless earlier repurchased or converted. Interest on the 1.125% Notes is payable semiannually in arrears on January 15 and July 15 at a rate of 1.125% per annum. The 1.125% Notes are senior unsecured obligations and rank senior in right of payment to any of our indebtedness that is expressly subordinated in right of payment to the 1.125% Notes; equal in right of payment to any of our unsecured indebtedness that is not subordinated; effectively junior in right of payment to any of our secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities of our subsidiaries. The 1.125% Notes are convertible only into cash, and not into shares of our common stock or any other securities. The initial conversion rate for the 1.125% Notes is 24.5277 shares of our common stock per $1,000 principal amount of the 1.125% Notes. This represents an initial conversion price of approximately $40.77 per share of our common stock. Upon conversion, in lieu of receiving shares of our common stock, a holder will receive an amount in cash, per $1,000 principal amount of 1.125% Notes, equal to the settlement amount, determined in the manner set forth in the indenture. We may not redeem the 1.125% Notes prior to the maturity date. Holders may convert their 1.125% Notes only under the following circumstances: • during any calendar quarter commencing after the calendar quarter ending on June 30, 2013 (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • during the five business day period immediately after any five consecutive trading day period (the measurement period) in which the trading price per $1,000 principal amount of 1.125% Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; • upon the occurrence of specified corporate events; or • at any time on or after July 15, 2019 until the close of business on the second scheduled trading day immediately preceding the maturity date. The 1.125% Notes met the stock price trigger in the quarter ended September 30, 2015, and are convertible to cash through at least December 31, 2015. Because the 1.125% Notes may be converted into cash within 12 months, the $450.3 million carrying amount is reported in current portion of long-term debt as of September 30, 2015 . The 1.125% Notes contain an embedded cash conversion option (the 1.125% Conversion Option), which was separated from the 1.125% Notes and accounted for separately as a derivative liability, with changes in fair value reported in our consolidated statements of income until the 1.125% Conversion Option settles or expires. The initial fair value liability of the 1.125% Conversion Option simultaneously reduced the carrying value of the 1.125% Notes (effectively an original issuance discount). This discount is amortized to the 1.125% Notes' principal amount through the recognition of non-cash interest expense over the expected life of the debt. This has resulted in our recognition of interest expense on the 1.125% Notes at an effective rate of approximately 6% . As of September 30, 2015 , the 1.125% Notes have a remaining amortization period of 4.3 years. The 1.125% Notes' if-converted value exceeded their principal amount by approximately $458 million and $93 million as of September 30, 2015 and December 31, 2014 , respectively. 1.625% Convertible Senior Notes due 2044. In September 2014, we issued $ 301.6 million aggregate principal amount of 1.625% convertible senior notes (the 1.625% Notes) due August 15, 2044, unless earlier repurchased, redeemed or converted. Interest on the 1.625% Notes is payable semiannually in arrears on February 15 and August 15, at a rate of 1.625% per annum, beginning on February 15, 2015 . In addition, beginning with the semiannual interest period commencing immediately following the interest payment date on August 15, 2018, contingent interest will accrue on the 1.625% Notes during any semiannual interest period in which certain conditions or events occur, or under certain events of default. For example, additional interest of 0.25 % per year will be payable on the 1.625% Notes for any semiannual interest period for which the principal amount of 1.625% Notes outstanding is less than $ 100 million . The 1.625% Notes are senior unsecured obligations and rank senior in right of payment to any of our indebtedness that is expressly subordinated in right of payment to the 1.625% Notes; equal in right of payment to any of our unsecured indebtedness that is not subordinated; effectively junior in right of payment to any of our secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities of our subsidiaries. The initial conversion rate for the 1.625% Notes is 17.2157 shares of our common stock per $1,000 principal amount of the 1.625% Notes. This represents an initial conversion price of approximately $ 58.09 per share of our common stock. Upon conversion, we will pay cash and, if applicable, deliver shares of our common stock to the converting holder in an amount per $1,000 principal amount of 1.625% Notes equal to the settlement amount (as defined in the related indenture). Holders may convert their 1.625% Notes only under the following circumstances: • during any calendar quarter commencing after the calendar quarter ending on September 30, 2014 (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • during the five business day period after any five consecutive trading day period (the measurement period) in which the trading price per $1,000 principal amount of 1.625% Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; • upon the occurrence of specified corporate events; • if we call any 1.625% Notes for redemption, at any time until the close of business on the business day immediately preceding the redemption date; • during the period from, and including, May 15, 2018 to the close of business on the business day immediately preceding August 19, 2018; or • at any time on or after February 15, 2044 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their 1.625% Notes, in integral multiples of $1,000 principal amount, at the option of the holder regardless of the foregoing circumstances. As of September 30, 2015 , the 1.625% Notes were not convertible. We may not redeem the 1.625% Notes prior to August 19, 2018 . On or after August 19, 2018, we may redeem for cash all or part of the 1.625% Notes, except for the 1.625% Notes we are required to repurchase in connection with a fundamental change or on any specified repurchase date. The redemption price for the 1.625% Notes will equal 100% of the principal amount of the 1.625% Notes being redeemed, plus accrued and unpaid interest. In addition, holders of the 1.625% Notes may require us to repurchase some or all of the 1.625% Notes for cash on August 19, 2018 , August 19, 2024 , August 19, 2029 , August 19, 2034 and August 19, 2039 , in each case, at a specified price equal to 100% of the principal amount of the 1.625% Notes to be repurchased, plus accrued and unpaid interest. Because the 1.625% Notes are net share settled and have cash settlement features, we have allocated the principal amount between a liability component and an equity component. The reduced carrying value on the 1.625% Notes resulted in a debt discount that is amortized back to the 1.625% Notes' principal amount through the recognition of non-cash interest expense over the expected life of the debt. The expected life of the debt is approximately four years, beginning on the issuance date and ending on the first date we may redeem the notes in August 2018. As of September 30, 2015 , the 1.625% Notes have a remaining amortization period of 2.9 years. This has resulted in our recognition of interest expense on the 1.625% Notes at an effective rate approximating what we would have incurred had nonconvertible debt with otherwise similar terms been issued, or approximately 5% . The outstanding 1.625% Notes’ if-converted value exceeded their principal amount by approximately $89 million as of September 30, 2015 , and did not exceed their principal amount as of December 31, 2014 . At September 30, 2015 , the equity component of the 1.625% Notes, including the impact of deferred taxes, was $ 22.9 million . The principal amounts, unamortized discount (net of premium related to 1.625% Notes), and net carrying amounts of the convertible senior notes were as follows: Principal Balance Unamortized Discount Net Carrying Amount (In thousands) September 30, 2015: 1.125% Notes $ 550,000 $ 99,696 $ 450,304 1.625% Notes 301,551 26,501 275,050 $ 851,551 $ 126,197 $ 725,354 December 31, 2014: 1.125% Notes $ 550,000 $ 114,670 $ 435,330 1.625% Notes 301,551 32,784 268,767 $ 851,551 $ 147,454 $ 704,097 Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Interest cost recognized for the period relating to the: Contractual interest coupon rate $ 2,772 $ 3,132 $ 8,316 $ 9,732 Amortization of the discount 7,185 6,455 21,257 19,183 $ 9,957 $ 9,587 $ 29,573 $ 28,915 Lease Financing Obligations. In 2013, we entered into a sale-leaseback transaction for the sale and contemporaneous leaseback of the Molina Center located in Long Beach, California, and our Ohio health plan office building located in Columbus, Ohio. Due to our continuing involvement with these leased properties, the sale did not qualify for sale-leaseback accounting treatment and we remain the "accounting owner" of the properties. These assets continue to be included in our consolidated balance sheets, and also continue to be depreciated over their remaining useful lives. The lease financing obligation is amortized over the 25 -year lease term such that there will be no gain or loss recorded if the lease is not extended at the end of its term. Rent will increase 3% per year through the initial term. Payments under the lease adjust the lease financing obligation, and the imputed interest is recorded to interest expense in our consolidated statements of income. Such interest expense amounted to $9.4 million and $9.3 million for the nine months ended September 30, 2015 and 2014 , respectively. As described and defined in further detail in Note 16 , " Related Party Transactions ," we entered into a lease for office space in February 2013 consisting of two office buildings. We have concluded that we are the accounting owner of the buildings due to our continuing involvement with the properties. We have recorded $36.5 million to property, equipment and capitalized software, net, in the accompanying consolidated balance sheets as of September 30, 2015 , which represents the total cost incurred by the Landlord for the construction of the buildings, net of accumulated depreciation. As of September 30, 2015 and December 31, 2014 , the aggregate amount recorded to lease financing obligations, including the current portion, amounted to $40.3 million and $40.6 million , respectively. Payments under the lease adjust the lease financing obligation, and the imputed interest is recorded to interest expense in our consolidated statements of income. Such interest expense was $3.0 million and $2.2 million for the nine months ended September 30, 2015 and 2014 , respectively. In addition to the capitalization of the costs incurred by the Landlord, we impute and record rent expense relating to the ground leases for the property sites. Such rent expense is computed based on the fair value of the land and our incremental borrowing rate, and was $0.9 million and $0.8 million for the nine months ended September 30, 2015 and 2014, respectively. |
Derivatives
Derivatives | 9 Months Ended |
Sep. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | Derivatives The following table summarizes the fair values and the presentation of our derivative financial instruments (defined and discussed individually below) in the consolidated balance sheets: Balance Sheet Location September 30, 2015 December 31, 2014 (In thousands) Derivative asset: 1.125% Call Option Current assets: Derivative asset $ 490,087 $ — Non-current assets: Derivative asset $ — $ 329,323 Derivative liability: 1.125% Conversion Option Current liabilities: Derivative liability $ 489,940 $ — Non-current liabilities: Derivative liability $ — $ 329,194 Our derivative financial instruments do not qualify for hedge treatment; therefore the change in fair value of these instruments is recognized immediately in our consolidated statements of income, and reported in other expense, net. Gains and losses for our derivative financial instruments are presented individually in the consolidated statements of cash flows, supplemental cash flow information. 1.125% Notes Call Spread Overlay. Concurrent with the issuance of the 1.125% Notes in 2013, we entered into privately negotiated hedge transactions (collectively, the 1.125% Call Option) and warrant transactions (collectively, the 1.125% Warrants), with certain of the initial purchasers of the 1.125% Notes (the Counterparties). We refer to these transactions collectively as the Call Spread Overlay. Under the Call Spread Overlay, the cost of the 1.125% Call Option we purchased to cover the cash outlay upon conversion of the 1.125% Notes was reduced by proceeds from the sale of the 1.125% Warrants. Assuming full performance by the Counterparties (and 1.125% Warrants strike prices in excess of the conversion price of the 1.125% Notes), these transactions are intended to offset cash payments in excess of the principal amount of the notes due upon any conversion of the 1.125% Notes. 1.125% Call Option. The 1.125% Call Option, which is indexed to our common stock, is a derivative asset that requires mark-to-market accounting treatment due to cash settlement features until the 1.125% Call Option settles or expires. For further discussion of the inputs used to determine the fair value of the 1.125% Call Option, refer to Note 6 , " Fair Value Measurements ." 1.125% Conversion Option. The embedded cash conversion option within the 1.125% Notes is accounted for separately as a derivative liability, with changes in fair value reported in our consolidated statements of income until the cash conversion option settles or expires. For further discussion of the inputs used to determine the fair value of the 1.125% Conversion Option, refer to Note 6 , " Fair Value Measurements ." As of September 30, 2015 , the 1.125% Call Option and the 1.125% Conversion Option were classified as a current asset and current liability, respectively, because the 1.125% Notes may be converted within 12 months of September 30, 2015 , as described in Note 11 , " Debt .” |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders' Equity Stockholders' equity increased $507.6 million during the nine months ended September 30, 2015 compared with stockholders' equity at December 31, 2014 . The increase was due primarily to the common stock offering described below, net income of $113.4 million , and $20.7 million related to employee stock transactions. Common Stock Offering. In June 2015, we completed an underwritten public offering of 5,750,000 shares of our common stock, including the over-allotment option, conducted pursuant to an effective shelf registration statement filed with the SEC in May 2015. Net of issuance costs, proceeds from the offering amounted to $373.2 million , or $64.90 per share, resulting in an increase to additional paid-in capital. We are using the proceeds to finance working capital needs, acquisitions, capital expenditures, and other general corporate activities. 1.125% Warrants. In connection with the 1.125% Notes Call Spread Overlay transaction described in Note 12 , " Derivatives ," we issued 13,490,236 warrants with a strike price of $53.8475 per share. The number of warrants and the strike price are subject to adjustment under certain circumstances. If the market value per share of our common stock exceeds the strike price of the 1.125% Warrants on any trading day during the 160 trading day measurement period (beginning on April 15, 2020) under the 1.125% Warrants, we will be obligated to issue to the Counterparties a number of shares equal in value to the product of the amount by which such market value exceeds such strike price and 1/160th of the aggregate number of shares of our common stock underlying the 1.125% Warrants, subject to a share delivery cap. The 1.125% Warrants could separately have a dilutive effect to the extent that the market value per share of our common stock (as measured under the terms of the warrant transactions) exceeds the applicable strike price of the 1.125% Warrants. Refer to Note 3 , " Net Income per Share ," for dilution information for the periods presented. We will not receive any additional proceeds if the 1.125% Warrants are exercised. Securities Repurchase Programs. Effective as of February 25, 2015, our board of directors authorized the repurchase of up to $50 million in aggregate of our common stock. Stock repurchases under this program may be made through open-market and/or privately negotiated transactions at times and in such amounts as management deems appropriate. The timing and actual number of shares repurchased will depend on a variety of factors including price, corporate and regulatory requirements and market conditions. This repurchase program extends through December 31, 2015. Stock Plans. In connection with our equity incentive plans and employee stock purchase plan, we issued approximately 480,000 shares of common stock, net of shares used to settle employees’ income tax obligations, for the nine months ended September 30, 2015 . |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We report our financial performance based on two reportable segments: the Health Plans segment and the Molina Medicaid Solutions segment. Our reportable segments are consistent with how we manage the business and view the markets we serve. Our Health Plans segment consists of our health plans and our direct delivery business. Our health plans represent operating segments that have been aggregated for reporting purposes because they share similar economic characteristics. Our Molina Medicaid Solutions segment provides MMIS design, development, and implementation; business process outsourcing solutions; hosting services; and information technology support services to state Medicaid agencies. We rely on an internal management reporting process that provides segment information to the operating income level for purposes of making financial decisions and allocating resources. The accounting policies of the segments are the same as those described in Note 2 , " Significant Accounting Policies ." For presentation purposes, the cost of centralized services is reported within the Health Plans segment. Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Revenue, continuing operations: Health Plans segment: Premium revenue $ 3,377,030 $ 2,316,759 $ 9,652,054 $ 6,424,238 Premium tax revenue 99,047 81,240 289,003 203,053 Health insurer fee revenue 81,158 29,427 202,996 67,785 Investment income 4,832 2,041 11,675 5,615 Other revenue 1,745 2,327 4,996 8,523 Molina Medicaid Solutions segment: Service revenue 47,551 52,557 146,652 156,419 $ 3,611,363 $ 2,484,351 $ 10,307,376 $ 6,865,633 Income from continuing operations before income tax expense: Health Plans segment $ 101,899 $ 29,874 $ 272,924 $ 65,879 Molina Medicaid Solutions segment 10,954 9,905 37,787 30,594 Operating income, continuing operations 112,853 39,779 310,711 96,473 Other expenses, net 15,229 15,282 45,009 43,044 $ 97,624 $ 24,497 $ 265,702 $ 53,429 September 30, December 31, 2014 Total assets: Health Plans segment $ 5,676,304 $ 4,270,870 Molina Medicaid Solutions segment 238,727 206,345 $ 5,915,031 $ 4,477,215 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings. The health care and business process outsourcing industries are subject to numerous laws and regulations of federal, state, and local governments. Compliance with these laws and regulations can be subject to government review and interpretation, as well as regulatory actions unknown and unasserted at this time. Penalties associated with violations of these laws and regulations include significant fines and penalties, exclusion from participating in publicly funded programs, and the repayment of previously billed and collected revenues. We are involved in legal actions in the ordinary course of business, some of which seek monetary damages, including claims for punitive damages, which are not covered by insurance. We have accrued liabilities for certain matters for which we deem the loss to be both probable and estimable. Although we believe that our estimates of such losses are reasonable, these estimates could change as a result of further developments of these matters. The outcome of legal actions is inherently uncertain and such pending matters for which accruals have not been established have not progressed sufficiently through discovery and/or development of important factual information and legal issues to enable us to estimate a range of possible loss, if any. While it is not possible to accurately predict or determine the eventual outcomes of these items, an adverse determination in one or more of these pending matters could have a material adverse effect on our consolidated financial position, results of operations, or cash flows. State of Louisiana. On June 26, 2014, the state of Louisiana filed a Petition for Damages against Molina Medicaid Solutions, Molina Healthcare, Inc., Unisys Corporation, and Paramax Systems Corporation, a subsidiary of Unisys, in the Parish of Baton Rouge, 19th Judicial District, versus number 631612. The Petition alleges that between 1989 and 2012, the defendants utilized an incorrect reimbursement formula for the payment of pharmaceutical claims. We believe we have several meritorious defenses to the claims of the state, and any liability for the alleged claims is not currently probable or reasonably estimable. USA and State of Florida ex rel. Charles Wilhelm. On July 24, 2014, Molina Healthcare, Inc. and Molina Healthcare of Florida, Inc. were served with a Complaint filed under seal on December 5, 2012 in District Court for the Southern District of Florida by relator, Charles C. Wilhelm, M.D., Case No. 12-24298. The Complaint alleges that in late 2008 and early 2009, in connection with the acquisition of Florida NetPass under which Molina Healthcare of Florida, Inc. began conducting business in the state of Florida, the defendants failed to adequately staff the plan and provide other services, resulting in a disproportionate number of sicker beneficiaries of Florida NetPass moving back into the Florida fee-for-service Medicaid program. This alleged conduct purportedly resulted in a violation of the federal False Claims Act. Both the United States of America and the state of Florida have declined to intervene. The District Court dismissed this case with prejudice. The Relator filed a motion for rehearing, which we opposed and which we believe has little chance of success. Should the motion for rehearing be denied, this case will be over. Should the motion for rehearing be granted, we believe we have several meritorious defenses to the claims of the relator, and any liability for the alleged claims is not currently probable or reasonably estimable. United States of America, ex rel., Anita Silingo v. Mobile Medical Examination Services, Inc., et al. On or around October 14, 2014, Molina Healthcare of California, Molina Healthcare of California Partner Plan, Inc., Mobile Medical Examination Services, Inc. (MedXM), and other health plan defendants were served with a Complaint previously filed under seal in the Central District Court of California by relator, Anita Silingo, Case No. SACV13-1348-FMO(SHx). The Complaint alleges that MedXM improperly modified medical records and otherwise took inappropriate steps to increase members’ risk adjustment scores, and that the defendants, including Molina Healthcare of California and Molina Healthcare of California Partner Plan, Inc., purportedly turned a “blind eye” to these unlawful practices. The Department of Justice has declined to intervene. The District Court dismissed this action as to Molina without leave to amend as to some allegations and with leave to amend as to other allegations. On October 22, 2015, the Relator filed a third amended complaint. We believe that we have several meritorious defenses to the claims of the Relator, and any liability for the alleged claims is not currently probable or reasonably estimable. Hospital Management Contract. Our subsidiary, Molina Hospital Management, Inc. (MHM), manages a portion of a hospital owned by College Health Enterprises (College) in Long Beach, California pursuant to the terms of a Management Services Agreement dated as of August 30, 2013 (the MSA) by and between MHM and CHLB, LLC, an affiliate of College. MHM's management services pursuant to the MSA have generated a financial loss each month since the inception of this arrangement, and could continue to generate losses. On August 27, 2015, MHM delivered to College a notice of immediate termination for cause of the MSA by reason of alleged material breaches by CHLB, LLC of various duties, obligations, and covenants in the MSA. On September 8, 2015, College notified us that it disputes the validity of our notice of termination in its entirety and, if the parties are unable to resolve their differences, College will commence binding arbitration. It is not possible to accurately predict or determine the eventual outcome of this matter. Provider Claims. Many of our medical contracts are complex in nature and may be subject to differing interpretations regarding amounts due for the provision of various services. Such differing interpretations have led certain medical providers to pursue us for additional compensation. The claims made by providers in such circumstances often involve issues of contract compliance, interpretation, payment methodology, and intent. These claims often extend to services provided by the providers over a number of years. Various providers have contacted us seeking additional compensation for claims that we believe to have been settled. These matters, when finally concluded and determined, will not, in our opinion, have a material adverse effect on our business, consolidated financial position, results of operations, or cash flows. Regulatory Capital and Dividend Restrictions. Our health plans, which are operated by our respective wholly owned subsidiaries in those states, are subject to state laws and regulations that, among other things, require the maintenance of minimum levels of statutory capital, as defined by each state. Regulators in some states may also attempt to enforce capital requirements upon us that require the retention of net worth in excess of amounts formally required by statute or regulation. Such statutes, regulations and informal capital requirements also restrict the timing, payment, and amount of dividends and other distributions that may be paid to us as the sole stockholder. To the extent our subsidiaries must comply with these regulations, they may not have the financial flexibility to transfer funds to us. Based upon current statutes and regulations, the net assets in these subsidiaries (after intercompany eliminations) which may not be transferable to us in the form of loans, advances, or cash dividends was approximately $1,072 million at September 30, 2015 , and $859 million at December 31, 2014 . Because of the statutory restrictions that inhibit the ability of our health plans to transfer net assets to us, the amount of retained earnings readily available to pay dividends to our stockholders is generally limited to cash, cash equivalents and investments held by the parent company – Molina Healthcare, Inc. Such cash, cash equivalents and investments amounted to $471.8 million and $202.6 million as of September 30, 2015 and December 31, 2014 , respectively. The National Association of Insurance Commissioners (NAIC), adopted rules effective December 31, 1998, which, if implemented by the states, set minimum capitalization requirements for insurance companies, HMOs, and other entities bearing risk for health care coverage. The requirements take the form of risk-based capital (RBC) rules which may vary from state to state. As of September 30, 2015 , our health plans had aggregate statutory capital and surplus of approximately $1,166 million compared with the required minimum aggregate statutory capital and surplus of approximately $592 million . All of our health plans were in compliance with the minimum capital requirements at September 30, 2015 . We have the ability and commitment to provide additional capital to each of our health plans when necessary to ensure that statutory capital and surplus continue to meet regulatory requirements. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions We have entered into a lease (the Amended Lease) with 6 th & Pine Development, LLC (the Landlord) for two office buildings. The principal members of the Landlord are John C. Molina, our chief financial officer and a director of the Company, and his wife. In addition, in connection with the development of the buildings being leased, John C. Molina pledged shares of common stock in the Company that he holds. Dr. J. Mario Molina, our chief executive officer, president and chairman of the board of directors, holds a partial interest in such shares as trust beneficiary. The Amended Lease provides for an annual rent escalator of 3.4% per year, and will expire on December 31, 2029, unless extended or earlier terminated. For information regarding the lease financing obligation, refer to Note 11 , " Debt ." Refer to Note 17 , " Variable Interest Entities (VIEs) ," for a discussion of the Joseph M. Molina, M.D. Professional Corporations. |
Variable Interest Entities (VIE
Variable Interest Entities (VIEs) | 9 Months Ended |
Sep. 30, 2015 | |
Variable Interest Entities [Abstract] | |
Variable Interest Entities (VIEs) | Variable Interest Entities (VIEs) Joseph M. Molina M.D., Professional Corporations The Joseph M. Molina, M.D. Professional Corporations (JMMPC) were created in 2012 to further advance our direct delivery business. JMMPC's primary shareholder is Dr. J. Mario Molina, our chief executive officer, president, and chairman of the board of directors. Dr. Molina is paid no salary and receives no dividends in connection with his work for, or ownership of, JMMPC. JMMPC provides primary care medical services through its employed physicians and other medical professionals. Beginning in the fourth quarter of 2014, JMMPC also provided certain specialty referral services to our California health plan members through a contracted provider network. Substantially all of the individuals served by JMMPC are members of our health plans. JMMPC does not have agreements to provide professional medical services with any other entities. Our wholly owned subsidiary, Molina Medical Management, Inc. (MMM), has entered into services agreements with JMMPC to provide clinic facilities, clinic administrative support staff, patient scheduling services and medical supplies to JMMPC. The services agreements were designed such that JMMPC will operate at break even, ensuring the availability of quality care and access for our health plan members. The services agreements provide that the administrative fees charged to JMMPC by MMM are reviewed annually to assure the achievement of this goal. Separately, our California, Florida, New Mexico, Utah and Washington health plans have entered into primary care services agreements with JMMPC. These agreements direct our health plans to perform a monthly reconciliation, to either fund JMMPC's operating deficits, or receive JMMPC's operating surpluses, such that JMMPC will derive no profit or loss. Because the MMM services agreements described above mitigate the likelihood of significant operating deficits or surpluses, such monthly reconciliation amounts are generally insignificant. We have determined that JMMPC is a VIE, and that we are its primary beneficiary. We have reached this conclusion under the power and benefits criterion model according to GAAP. Specifically, we have the power to direct the activities that most significantly affect JMMPC's economic performance, and the obligation to absorb losses or right to receive benefits that are potentially significant to the VIE, under the agreements described above. Because we are its primary beneficiary, we have consolidated JMMPC. JMMPC's assets may be used to settle only JMMPC's obligations, and JMMPC's creditors have no recourse to the general credit of Molina Healthcare, Inc. As of September 30, 2015 , JMMPC had total assets of $7.1 million , and total liabilities of $6.8 million . As of December 31, 2014 , JMMPC had total assets of $31.1 million , and total liabilities of $30.8 million . Our maximum exposure to loss as a result of our involvement with JMMPC is generally limited to the amounts needed to fund JMMPC's ongoing payroll, employee benefits and medical care costs associated with JMMPC's specialty referral activities. We believe that such loss exposures will be immaterial to our consolidated operating results and cash flows for the foreseeable future. |
Significant Accounting Polici24
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Consolidation and Interim Financial Information | Consolidation and Interim Financial Information The consolidated financial statements include the accounts of Molina Healthcare, Inc., its subsidiaries, and variable interest entities (VIEs) in which Molina Healthcare, Inc. is considered to be the primary beneficiary. Such VIEs are insignificant to our consolidated financial position and results of operations. In the opinion of management, all adjustments considered necessary for a fair presentation of the results as of the date and for the interim periods presented have been included; such adjustments consist of normal recurring adjustments. All significant intercompany balances and transactions have been eliminated. The consolidated results of operations for the current interim period are not necessarily indicative of the results for the entire year ending December 31, 2015 . The unaudited consolidated interim financial statements have been prepared under the assumption that users of the interim financial data have either read or have access to our audited consolidated financial statements for the fiscal year ended December 31, 2014 . Accordingly, certain disclosures that would substantially duplicate the disclosures contained in the December 31, 2014 audited consolidated financial statements have been omitted. These unaudited consolidated interim financial statements should be read in conjunction with our December 31, 2014 audited consolidated financial statements. |
Premium Revenue – Health Plans Segment | Premium Revenue – Health Plans Segment Premium revenue is fixed in advance of the periods covered and, except as described below, is not generally subject to significant accounting estimates. Premium revenues are recognized in the month that members are entitled to receive health care services, and premiums collected in advance are deferred. Certain components of premium revenue are subject to accounting estimates as follows: Contractual Provisions That May Adjust or Limit Revenue or Profit Medicaid Medical Cost Floors (Minimums), Medical Cost Corridors, and Administrative Cost Ceilings (Maximums): A portion of certain premiums received by our health plans may be returned if certain minimum amounts are not spent on defined medical care costs. In the aggregate, we recorded a liability under the terms of such contract provisions of $536.5 million and $392.0 million at September 30, 2015 and December 31, 2014 , respectively, to amounts due government agencies. Approximately $523.2 million of the liability accrued at September 30, 2015 relates to our participation in Medicaid expansion programs. In general, such amounts are subject to future changes in estimate based upon our actual cost performance and clarification and alteration of the definitions of allowable medical costs and revenue. At our Washington health plan (where we had recorded a liability of approximately $280 million related to the Medicaid expansion medical cost floor for 2014 and 2015 combined at September 30, 2015 ), premium revenue may be retroactively adjusted across the entire state Medicaid expansion program based upon the medical cost performance of the program as a whole. As such, our liability under Washington’s contractual provisions is determined not just by our own medical cost performance, but by that of all health plans participating in the program; and we have limited visibility into the costs of those health plans. In October 2015, we settled our 2014 Medicaid expansion medical cost floor liability with the state of Washington with the payment of $246.6 million . This amount exceeded our estimate of that liability as of June 30, 2015 by approximately $7 million . In certain circumstances, the health plans may receive additional premiums if amounts spent on medical care costs exceed a defined maximum threshold. We had $9.2 million recorded at September 30, 2015 relating to such provisions. No such receivables were recorded at December 31, 2014 . Profit Sharing and Profit Ceiling: Our contracts with certain states contain profit-sharing or profit ceiling provisions under which we refund amounts to the states if our health plans generate profit above a certain specified percentage, in some cases in accordance with a tiered rebate schedule. In some cases, we are limited in the amount of administrative costs that we may deduct in calculating the refund, if any. As a result of profits in excess of the amount we are allowed to retain, we recorded a liability of $9.3 million and $0.5 million at September 30, 2015 and December 31, 2014 , respectively. Retroactive Premium Adjustments: In New Mexico, when members are retroactively enrolled into our health plan we earn revenue only to the extent of the actual medical costs incurred by us for services provided during those retroactive periods, plus a small percentage of that medical cost for administration and profit. This cost plus arrangement for members retroactively enrolled in our health plan first became effective July 1, 2014 (retroactive to January 1, 2014). We are paid normal monthly capitation rates for the retroactive eligibility periods, and the difference between those capitation rates and the amounts due us on a cost plus basis are periodically settled with the state. To date, no such settlement has been made with the state. Our New Mexico contract is not specific as to the definition of retroactive membership, and the amount we owe back to the state for the difference between capitation received and amounts due us under the cost plus arrangement varies widely depending upon the definition of retroactive membership. In August 2015 the state provided us with a request for payment under the terms of this contract provision for the period January 1, 2014 through December 31, 2014. That request was based upon definitions of retroactive membership that were at odds with our interpretations of that term. The New Mexico health plan reduced revenue by approximately $20 million in the third quarter of 2015 to better align our interpretation of certain contractual provisions related to revenue for members added retroactively to the state’s interpretation of those provisions. Even after that adjustment, however, we estimate that, based upon our interpretation of the state’s proposed definition of retroactive membership, the amount we would owe for the period January 1, 2014 through September, 2015 would exceed our accrual for such liability at September 30, 2015 by between $15 million and $20 million. We are currently engaged in discussions with the state regarding the appropriate amount, if any, owed to the state under this contract term. Medicare Risk Adjustment: Based on member encounter data that we submit to the Centers for Medicare and Medicaid Services (CMS), our Medicare premiums are subject to retroactive increase or decrease based upon member medical conditions for up to two years after the original year of service. We estimate the amount of Medicare revenue that will ultimately be realized for the periods presented based on our knowledge of our members’ health care utilization patterns and CMS practices. Based on our knowledge of member health care utilization patterns and expenses, we have recorded a net receivable of $2.3 million and $7.6 million for anticipated Medicare risk adjustment premiums at September 30, 2015 and December 31, 2014 , respectively. Marketplace Premium Stabilization Programs: The Affordable Care Act (ACA) established Marketplace premium stabilization programs effective January 1, 2014. These programs, commonly referred to as the "3R's," include a permanent risk adjustment program, a transitional reinsurance program, and a temporary risk corridor program. We record receivables or payables related to the 3R programs based on our year-to-date experience when the amounts are reasonably estimable, and, for receivables, collection is reasonably assured. • Permanent risk adjustment program: Under this permanent program, our health plans' risk scores are compared to the overall average risk score for the relevant state and market pool. Generally, our health plans will pay into the pool if their risk scores are below the average risk score, and will receive funds from the pool if their risk scores are above the average risk score. • Transitional reinsurance program: This program is designed to provide reimbursement to insurers for high cost members. Our health plans pay an annual contribution on a per-member basis, and are eligible for recoveries if claims for individual members exceed a specified threshold, up to a maximum amount. This three-year program will end in 2016. • Temporary risk corridor program: This program is intended to limit gains and losses of insurers by comparing allowable costs to a target amount as defined by the U.S. Department of Health and Human Services (HHS). Variances from the target amount exceeding certain thresholds may result in amounts due to or receivable from HHS. This three-year program will end in 2016. Due to uncertainties as to the amount of federal funding available to support the risk corridor program, we do not recognize amounts receivable under this program. All liabilities are recognized as incurred. Additionally, the ACA established a minimum annual medical loss ratio (Minimum MLR) of 80% for the Marketplace. The medical loss ratio represents medical costs as a percentage of premium revenue, where the components of medical costs and premium revenue are specifically defined by federal regulations. Each of the 3R programs is taken into consideration when computing the Minimum MLR. If the Minimum MLR is not met, we may be required to pay rebates to our Marketplace policyholders. Our receivables (payables) for each of these programs, as of the dates indicated, were as follows (in millions): September 30, 2015 December 31, 2014 Risk adjustment $ (136.1 ) $ (4.8 ) Reinsurance 21.9 4.9 Risk corridor (11.8 ) (0.5 ) Minimum MLR (12.5 ) — Quality Incentives At our California, Illinois, New Mexico, Ohio, South Carolina, Texas, Washington and Wisconsin health plans, revenue ranging from approximately 1% to 4% of certain health plan premiums is not earned unless specified performance measures are met. |
Income Taxes | Income Taxes The provision for income taxes is determined using an estimated annual effective tax rate, which is generally greater than the U.S. federal statutory rate primarily because of state taxes, nondeductible expenses under the Affordable Care Act Health Insurer Fee (HIF), nondeductible compensation and other general and administrative expenses. The effective tax rate may be subject to fluctuations during the year, particularly as a result of the level of pretax earnings, and also as new information is obtained. Such information may affect the assumptions used to estimate the annual effective tax rate, including factors such as the mix of pretax earnings in the various tax jurisdictions in which we operate, valuation allowances against deferred tax assets, the recognition or the reversal of the recognition of tax benefits related to uncertain tax positions, and changes in or the interpretation of tax laws in jurisdictions where we conduct business. We recognize deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of our assets and liabilities, along with net operating loss and tax credit carryovers. |
New Accounting Standards | New Accounting Standards Business Combinations. In September 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-16, Simplifying the Accounting for Measurement-Period Adjustments , which will require that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period (a reasonable time period after the acquisition date) in the reporting period in which the adjustment amounts are determined. Effective for us in the first quarter of 2016, ASU 2015-16 is applied prospectively. Revenue Recognition. On July 9, 2015, the FASB affirmed its proposal to defer the effective date of ASU No. 2014-09, Revenue from Contracts with Customers, for all entities by one year. As a result, public business entities will apply the new revenue standard to annual reporting periods beginning after December 15, 2017, and for interim reporting periods within annual reporting periods beginning after December 15, 2017. We continue to evaluate whether to elect the full or modified retrospective adoption method, and the potential effects to our financial statements. Short-Duration Contracts. In May 2015, the FASB issued ASU 2015-09, Disclosures about Short-Duration Contracts , which will require additional disclosure on the liability for unpaid claims and claim adjustment expenses. Effective for us in the first quarter of 2016, ASU 2015-09 is applied retrospectively to all prior periods presented in the financial statements. Early adoption is permitted; we are evaluating the potential effects of the adoption to our financial statements. Debt Issuance Costs. In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs , which will require debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of such debt liability, consistent with debt discounts. In a subsequent Staff Announcement, the Securities and Exchange Commission (SEC) announced that it would not object to an entity deferring and presenting debt issuance costs relating to a line-of-credit arrangement as an asset. This Staff Announcement was incorporated by the FASB through ASU 2015-15, issued in August 2015. Effective for us in the first quarter of 2016, ASU 2015-03 is applied retrospectively to all prior periods presented in the financial statements. Early adoption is permitted; we are evaluating the potential effects of the adoption to our financial statements. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the SEC did not have, or are not believed by management to have, a material impact on our present or future consolidated financial statements. |
Significant Accounting Polici25
Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Receivables (payables) for 3R programs | Our receivables (payables) for each of these programs, as of the dates indicated, were as follows (in millions): September 30, 2015 December 31, 2014 Risk adjustment $ (136.1 ) $ (4.8 ) Reinsurance 21.9 4.9 Risk corridor (11.8 ) (0.5 ) Minimum MLR (12.5 ) — |
Quality incentive premium revenue recognized | The following table quantifies the quality incentive premium revenue recognized for the periods presented, including the amounts earned in the period presented and prior periods. Although the reasonably possible effects of a change in estimate related to quality incentive premium revenue as of September 30, 2015 are not known, we have no reason to believe that the adjustments to prior years noted below are not indicative of the potential future changes in our estimates as of September 30, 2015 . Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (In thousands) Maximum available quality incentive premium - current period $ 28,384 $ 24,477 $ 86,529 $ 68,941 Amount of quality incentive premium revenue recognized in current period: Earned current period $ 17,073 $ 12,921 $ 37,849 $ 30,935 Earned prior periods (609 ) 208 10,862 3,412 Total $ 16,464 $ 13,129 $ 48,711 34,347 Total premium revenue recognized for state health plans with quality incentive premiums $ 2,517,474 $ 1,818,375 $ 7,396,280 $ 5,005,444 |
Net Income per Share (Table)
Net Income per Share (Table) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Summary of denominators for the computation of basic and diluted net income (loss) per share | The following table sets forth the calculation of the denominators used to compute basic and diluted net income per share: Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (In thousands) Shares outstanding at the beginning of the period 54,788 46,494 48,578 45,871 Weighted-average number of shares issued: Common stock offering — — 2,393 — Issued, 3.75% Notes and 3.75% Exchange (1) — 460 — 155 Share-based compensation 15 37 295 409 Denominator for basic net income per share 54,803 46,991 51,266 46,435 Effect of dilutive securities: Share-based compensation 353 365 417 441 Convertible senior notes (1) 1,126 1,288 602 1,212 1.125% Warrants (1) 3,696 — 2,414 — Denominator for diluted net income per share 59,978 48,644 54,699 48,088 Potentially dilutive common shares excluded from calculations (2): Restricted shares — — 3 — 1.125% Warrants — 13,490 — 13,490 ______________________________ (1) For more information regarding the convertible senior notes, refer to Note 11 , " Debt ." For more information regarding the 1.125% Warrants, refer to Note 12 , " Derivatives ." (2) The dilutive effect of all potentially dilutive common shares is calculated using the treasury-stock method. Certain potentially dilutive common shares issuable are not included in the computation of diluted net income per share because to do so would be anti-dilutive. For the three and nine months ended September 30, 2014 , the 1.125% Warrants were excluded from diluted shares outstanding because the exercise price exceeded the average market price of our common stock. |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock based compensation expense | Charged to general and administrative expenses, total share-based compensation expense was as follows: Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (In thousands) Restricted stock and performance awards $ 5,707 $ 4,774 $ 12,962 $ 13,596 Employee stock purchase plan and stock options 1,278 885 3,264 2,519 $ 6,985 $ 5,659 $ 16,226 $ 16,115 |
Restricted share activity | Restricted and performance stock activity for the nine months ended September 30, 2015 is summarized below: Shares Weighted Average Grant Date Fair Value Unvested balance as of December 31, 2014 1,282,072 $ 33.55 Granted 428,223 64.25 Vested (397,115 ) 33.39 Forfeited (47,759 ) 37.51 Unvested balance as of September 30, 2015 1,265,421 43.84 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair value of assets measured on recurring basis | Our financial instruments measured at fair value on a recurring basis at September 30, 2015 , were as follows: Total Level 1 Level 2 Level 3 (In thousands) Corporate debt securities $ 938,284 $ — $ 938,284 $ — Municipal securities 201,921 — 201,921 — GSEs 133,624 133,624 — — U.S. treasury notes 74,943 74,943 — — Certificates of deposit 84,593 — 84,593 — Asset-backed securities 27,282 — 27,282 — Mortgage-backed securities 820 — 820 — Subtotal - current investments 1,461,467 208,567 1,252,900 — Auction rate securities 2,355 — — 2,355 1.125% Call Option derivative asset 490,087 — — 490,087 Total assets measured at fair value on a recurring basis $ 1,953,909 $ 208,567 $ 1,252,900 $ 492,442 1.125% Conversion Option derivative liability $ 489,940 $ — $ — $ 489,940 Contingent consideration liability 500 — — 500 Total liabilities measured at fair value on a recurring basis $ 490,440 $ — $ — $ 490,440 Our financial instruments measured at fair value on a recurring basis at December 31, 2014 , were as follows: Total Level 1 Level 2 Level 3 (In thousands) Corporate debt securities $ 641,729 $ — $ 641,729 $ — Municipal securities 127,045 — 127,045 — GSEs 122,269 122,269 — — U.S. treasury notes 59,543 59,543 — — Certificates of deposit 68,876 — 68,876 — Subtotal - current investments 1,019,462 181,812 837,650 — Auction rate securities 4,847 — — 4,847 1.125% Call Option derivative asset 329,323 — — 329,323 Total assets measured at fair value on a recurring basis $ 1,353,632 $ 181,812 $ 837,650 $ 334,170 1.125% Conversion Option derivative liability $ 329,194 $ — $ — $ 329,194 Contingent consideration liability 500 — — 500 Total liabilities measured at fair value on a recurring basis $ 329,694 $ — $ — $ 329,694 |
Fair value of assets measured on recurring basis using unobservable inputs | The following table presents activity relating to our assets (liabilities) measured at fair value on a recurring basis using significant unobservable inputs (Level 3): Changes in Level 3 Instruments Auction Rate Securities Derivatives, Net Contingent Consideration Liability (In thousands) Balance at December 31, 2014 $ 4,847 $ 129 $ (500 ) Total gains for the period recognized in: Other expenses, net — 18 — Other comprehensive income 108 — — Settlements (2,600 ) — — Balance at September 30, 2015 $ 2,355 $ 147 $ (500 ) |
Schedule of fair value, asset and liabilities measured on recurring basis - disclosure only | The carrying amounts and estimated fair values of our convertible senior notes, which are classified as Level 2 financial instruments, are indicated in the following table. Fair value for these securities is determined using a market approach based on quoted prices for similar securities in active markets or quoted prices for identical securities in inactive markets. September 30, 2015 Carrying Value Total Fair Value Level 1 Level 2 Level 3 (In thousands) 1.125% Notes $ 450,304 $ 960,515 $ — $ 960,515 $ — 1.625% Notes 275,050 393,099 — 393,099 — $ 725,354 $ 1,353,614 $ — $ 1,353,614 $ — December 31, 2014 Carrying Value Total Fair Value Level 1 Level 2 Level 3 (In thousands) 1.125% Notes $ 435,330 $ 767,377 $ — $ 767,377 $ — 1.625% Notes 268,767 337,292 — 337,292 — $ 704,097 $ 1,104,669 $ — $ 1,104,669 $ — |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | The following tables summarize our investments as of the dates indicated: September 30, 2015 Amortized Gross Unrealized Estimated Fair Cost Gains Losses Value (In thousands) Corporate debt securities $ 939,611 $ 668 $ 1,995 $ 938,284 Municipal securities 201,876 317 272 201,921 GSEs 133,528 126 30 133,624 U.S. treasury notes 74,724 219 — 74,943 Certificates of deposit 84,615 4 26 84,593 Asset-backed securities 27,265 24 7 27,282 Mortgage-backed securities 817 3 — 820 Subtotal - current investments 1,462,436 1,361 2,330 1,461,467 Auction rate securities 2,500 — 145 2,355 $ 1,464,936 $ 1,361 $ 2,475 $ 1,463,822 December 31, 2014 Amortized Gross Unrealized Estimated Fair Cost Gains Losses Value (In thousands) Corporate debt securities $ 642,910 $ 201 $ 1,382 $ 641,729 Municipal securities 127,185 129 269 127,045 GSEs 122,317 34 82 122,269 U.S. treasury notes 59,546 30 33 59,543 Certificates of deposit 68,893 1 18 68,876 Subtotal - current investments 1,020,851 395 1,784 1,019,462 Auction rate securities 5,100 — 253 4,847 $ 1,025,951 $ 395 $ 2,037 $ 1,024,309 |
Contractual maturities of investments | The contractual maturities of our investments as of September 30, 2015 are summarized below: Amortized Cost Estimated Fair Value (In thousands) Due in one year or less $ 659,930 $ 659,729 Due after one year through five years 771,762 770,930 Due after five years through ten years 30,744 30,808 Due after ten years 2,500 2,355 $ 1,464,936 $ 1,463,822 |
Schedule of available for sale securities continuous unrealized loss position | The following table segregates those available-for-sale investments that have been in a continuous loss position for less than 12 months, and those that have been in a loss position for 12 months or more as of September 30, 2015 : In a Continuous Loss Position for Less than 12 Months In a Continuous Loss Position for 12 Months or More Estimated Fair Value Unrealized Losses Total Number of Positions Estimated Fair Value Unrealized Losses Total Number of Positions (Dollars in thousands) Corporate debt securities $ 408,736 $ 1,611 300 $ 136,776 $ 384 80 Municipal securities 88,681 190 110 12,155 82 15 GSEs 51,393 30 17 — — — Certificates of deposit 35,654 26 148 — — — Asset-backed securities 16,689 7 20 — — — Auction rate securities — — — 2,355 145 3 $ 601,153 $ 1,864 595 $ 151,286 $ 611 98 The following table segregates those available-for-sale investments that have been in a continuous loss position for less than 12 months, and those that have been in a loss position for 12 months or more as of December 31, 2014 : In a Continuous Loss Position for Less than 12 Months In a Continuous Loss Position for 12 Months or More Estimated Fair Value Unrealized Losses Total Number of Positions Estimated Fair Value Unrealized Losses Total Number of Positions (Dollars in thousands) Corporate debt securities $ 379,034 $ 1,151 265 $ 28,668 $ 231 10 Municipal securities 53,626 168 64 11,075 101 13 GSEs 75,025 69 22 2,986 13 3 U.S. treasury notes 19,199 33 13 — — — Certificates of deposit 12,591 18 52 — — — Auction rate securities — — — 4,847 253 6 $ 539,475 $ 1,439 416 $ 47,576 $ 598 32 |
Receivables (Tables)
Receivables (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Receivables [Abstract] | |
Summary of Accounts Receivable | September 30, December 31, (In thousands) California $ 108,972 $ 310,938 Florida 23,096 2,141 Illinois 78,159 31,594 Michigan 49,348 19,880 New Mexico 87,493 49,609 Ohio 102,786 45,187 Puerto Rico 14,430 — South Carolina 6,626 4,134 Texas 41,531 29,348 Utah 11,595 6,389 Washington 38,999 42,848 Wisconsin 26,530 8,102 Direct delivery and other 5,761 11,295 Total Health Plans segment 595,326 561,465 Molina Medicaid Solutions segment 24,565 34,991 $ 619,891 $ 596,456 |
Restricted Investments (Tables)
Restricted Investments (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of restricted investments by health plan | The following table presents the balances of restricted investments: September 30, December 31, (In thousands) California $ 373 $ 373 Florida 27,029 28,649 Illinois 311 311 Michigan 1,014 1,014 New Mexico 42,645 35,135 Ohio 11,726 12,719 Puerto Rico 10,098 5,097 South Carolina 310 6,040 Texas 3,502 3,500 Utah 3,616 3,601 Washington 151 151 Wisconsin 953 — Other 242 888 Total Health Plans segment 101,970 97,478 Molina Medicaid Solutions segment — 5,001 $ 101,970 $ 102,479 |
Contractual maturities of our held-to-maturity restricted investments | The contractual maturities of our held-to-maturity restricted investments as of September 30, 2015 are summarized below: Amortized Cost Estimated Fair Value (In thousands) Due in one year or less $ 91,518 $ 91,519 Due one year through five years 10,452 10,464 $ 101,970 $ 101,983 |
Medical Claims and Benefits P32
Medical Claims and Benefits Payable (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of liability for unpaid claims and claims adjustment expense | The following table provides the details of our medical claims and benefits payable (including amounts payable for the provision of long-term services and supports, or LTSS) as of the dates indicated. September 30, December 31, (In thousands) Fee-for-service claims incurred but not paid (IBNP) $ 1,184,147 $ 870,429 Pharmacy payable 93,953 71,412 Capitation payable 30,061 28,150 Other 251,409 230,531 $ 1,559,570 $ 1,200,522 |
Components of change in medical claims and benefits payable | The following table presents the components of the change in our medical claims and benefits payable from continuing and discontinued operations combined for the periods indicated. The amounts presented for “Components of medical care costs related to: Prior periods” represent the amount by which our original estimate of medical 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. Nine Months Ended Year Ended September 30, 2015 December 31, 2014 (Dollars in thousands) Medical claims and benefits payable, beginning balance $ 1,200,522 $ 669,787 Components of medical care costs related to: Current period 8,723,573 8,122,885 Prior periods (1) (142,948 ) (45,979 ) Total medical care costs 8,580,625 8,076,906 Change in non-risk provider payables 42,067 (31,973 ) Payments for medical care costs related to: Current period 7,371,504 7,064,427 Prior periods 892,140 449,771 Total paid 8,263,644 7,514,198 Medical claims and benefits payable, ending balance $ 1,559,570 $ 1,200,522 Benefit from prior period as a percentage of: Balance at beginning of period 11.9 % 6.9 % Premium revenue, trailing twelve months 1.2 % 0.5 % Medical care costs, trailing twelve months 1.3 % 0.6 % ____________________ (1) The benefit from prior period development of medical claims and benefits payable for the nine months ended September 30, 2015 included approximately $23 million relating to programs that contain medical cost floor or corridor provisions. Accordingly, premium revenue for the nine months ended September 30, 2015 was reduced by the same amount. |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of maturities of long-term debt | As of September 30, 2015 , contractual maturities of debt for the years ending December 31 are as follows (in thousands): Total 2015 2016 2017 2018 2019 Thereafter 1.125% Notes $ 550,000 $ — $ — $ — $ — $ — $ 550,000 1.625% Notes (1) 301,551 — — — — — 301,551 $ 851,551 $ — $ — $ — $ — $ — $ 851,551 (1) The 1.625% Notes have a contractual maturity date in 2044; however, on specified dates beginning in 2018 as described below, holders of the 1.625% Notes may require us to repurchase some or all of the 1.625% Notes, or we may redeem any or all of the 1.625% Notes. |
Long term debt | The principal amounts, unamortized discount (net of premium related to 1.625% Notes), and net carrying amounts of the convertible senior notes were as follows: Principal Balance Unamortized Discount Net Carrying Amount (In thousands) September 30, 2015: 1.125% Notes $ 550,000 $ 99,696 $ 450,304 1.625% Notes 301,551 26,501 275,050 $ 851,551 $ 126,197 $ 725,354 December 31, 2014: 1.125% Notes $ 550,000 $ 114,670 $ 435,330 1.625% Notes 301,551 32,784 268,767 $ 851,551 $ 147,454 $ 704,097 |
Debt instruments interest cost recognized | Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Interest cost recognized for the period relating to the: Contractual interest coupon rate $ 2,772 $ 3,132 $ 8,316 $ 9,732 Amortization of the discount 7,185 6,455 21,257 19,183 $ 9,957 $ 9,587 $ 29,573 $ 28,915 |
Derivatives (Tables)
Derivatives (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The following table summarizes the fair values and the presentation of our derivative financial instruments (defined and discussed individually below) in the consolidated balance sheets: Balance Sheet Location September 30, 2015 December 31, 2014 (In thousands) Derivative asset: 1.125% Call Option Current assets: Derivative asset $ 490,087 $ — Non-current assets: Derivative asset $ — $ 329,323 Derivative liability: 1.125% Conversion Option Current liabilities: Derivative liability $ 489,940 $ — Non-current liabilities: Derivative liability $ — $ 329,194 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Operating segment information | Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Revenue, continuing operations: Health Plans segment: Premium revenue $ 3,377,030 $ 2,316,759 $ 9,652,054 $ 6,424,238 Premium tax revenue 99,047 81,240 289,003 203,053 Health insurer fee revenue 81,158 29,427 202,996 67,785 Investment income 4,832 2,041 11,675 5,615 Other revenue 1,745 2,327 4,996 8,523 Molina Medicaid Solutions segment: Service revenue 47,551 52,557 146,652 156,419 $ 3,611,363 $ 2,484,351 $ 10,307,376 $ 6,865,633 Income from continuing operations before income tax expense: Health Plans segment $ 101,899 $ 29,874 $ 272,924 $ 65,879 Molina Medicaid Solutions segment 10,954 9,905 37,787 30,594 Operating income, continuing operations 112,853 39,779 310,711 96,473 Other expenses, net 15,229 15,282 45,009 43,044 $ 97,624 $ 24,497 $ 265,702 $ 53,429 September 30, December 31, 2014 Total assets: Health Plans segment $ 5,676,304 $ 4,270,870 Molina Medicaid Solutions segment 238,727 206,345 $ 5,915,031 $ 4,477,215 |
Basis of Presentation (Details)
Basis of Presentation (Details) member in Thousands, $ in Millions | Jan. 01, 2016countyrenewal_option | Sep. 03, 2015USD ($) | Sep. 01, 2015USD ($)member | Aug. 01, 2015USD ($)member | May. 01, 2015renewal_option | Mar. 31, 2016member | Dec. 31, 2015member | Sep. 30, 2015memberState | Sep. 30, 2015memberStateSegment |
Basis Of Presentation [Line Items] | |||||||||
Number of reportable segments | Segment | 2 | ||||||||
Health Plans | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Number of states in which entity operates | State | 11 | 11 | |||||||
Number of members eligible for the health care programs | 3,500 | 3,500 | |||||||
MMP Integrated Dual | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Health Care Organization, Number of Members | 56 | 56 | |||||||
Florida | Marketplace | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Health Care Organization, Number of Members | 148 | 148 | |||||||
Puerto Rico | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Health Care Organization, Number of Members | 356 | 356 | |||||||
New Jersey | Molina Medicaid Solutions | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Contractual term | 10 years | ||||||||
Number of renewal options | renewal_option | 3 | ||||||||
Period of contract renewal term | 1 year | ||||||||
Scenario, Forecast | Michigan | Molina Medicaid Solutions | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Contractual term | 5 years | ||||||||
Number of renewal options | renewal_option | 3 | ||||||||
Period of contract renewal term | 1 year | ||||||||
Increase in number of counties in which entity operates | county | 15 | ||||||||
Providence Human Services, LLC and Providence Community Services, LLC | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Initial purchase price of business acquisition | $ | $ 200 | ||||||||
Integral Health Plan, Inc. | Scenario, Forecast | Florida | Medicaid | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Number of members added | 90 | ||||||||
Preferred Medical Plan, Inc. | Florida | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Initial purchase price of business acquisition | $ | $ 8.2 | ||||||||
Number of members added | 23 | ||||||||
Loyola Physician Partners, LLC | Scenario, Forecast | Illinois | Medicaid | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Number of members added | 20 | ||||||||
Accountable Care Chicago, LLC | Scenario, Forecast | Illinois | Medicaid | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Number of members added | 61 | ||||||||
HealthPlus of Michigan and HealthPlus Partners, Inc. | Michigan | |||||||||
Basis Of Presentation [Line Items] | |||||||||
Initial purchase price of business acquisition | $ | $ 61.1 | ||||||||
Number of members added | 88 | 88 |
Significant Accounting Polici37
Significant Accounting Policies (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
Oct. 31, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Aug. 31, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | |
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||||||
Amounts due government agencies | $ 980,317,000 | $ 980,317,000 | $ 527,193,000 | |||||
Payment of Medicaid Expansion medical cost floor liability | 453,124,000 | $ 340,775,000 | ||||||
Premiums receivable | 9,200,000 | 9,200,000 | ||||||
Revenues | 3,611,363,000 | $ 2,484,351,000 | $ 10,307,376,000 | $ 6,865,633,000 | ||||
Maximum period for member risk scores and member pharmacy cost experience after original year of service | 2 years | |||||||
Anticipated Medicare risk adjustment premiums | 2,300,000 | $ 2,300,000 | 7,600,000 | |||||
Retroactive Premium Adjustments | Minimum | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||||||
Amount that exceeds accrual | $ 15,000,000 | |||||||
Retroactive Premium Adjustments | Maximum | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||||||
Amount that exceeds accrual | $ 20,000,000 | |||||||
Adjustment to Previously Recognized Revenue | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||||||
Revenues | (20,000,000) | |||||||
California | California Department of Health Care Services | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||||||
Maximum alternative minimum payment upon expiration of the settlement agreement | 40,000,000 | 40,000,000 | ||||||
Medicaid Expansion | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||||||
Amounts due government agencies | 523,200,000 | 523,200,000 | ||||||
Medicaid Expansion | Washington | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||||||
Amounts due government agencies | 280,000,000 | 280,000,000 | ||||||
Amount that exceeded estimate of liability | $ 7,000,000 | |||||||
Medicaid Expansion | Subsequent Event | Washington | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||||||
Payment of Medicaid Expansion medical cost floor liability | $ 246,600,000 | |||||||
Medical Premium Liability Due to Agency | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||||||
Medical premiums liability based on medical cost thresholds | 536,500,000 | 536,500,000 | 392,000,000 | |||||
Profit sharing liability | $ 9,300,000 | $ 9,300,000 | $ 500,000 |
Significant Accounting Polici38
Significant Accounting Policies - 3R Program Receivables (Payables) (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Accounting Policies [Abstract] | ||
Risk adjustment | $ (136.1) | $ (4.8) |
Reinsurance | 21.9 | 4.9 |
Risk corridor | (11.8) | (0.5) |
Minimum MLR | $ (12.5) | $ 0 |
Significant Accounting Polici39
Significant Accounting Policies - Quality Incentive Premium Revenue Recognized (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||
Total premium revenue recognized for state health plans with quality incentive premiums | $ 3,377,030 | $ 2,316,759 | $ 9,652,054 | $ 6,424,238 |
California, Illinois, New Mexico, Ohio, South Carolina, Texas, Washington, and Wisconsin | ||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||
Maximum available quality incentive premium - current period | 28,384 | 24,477 | 86,529 | 68,941 |
Amount of quality incentive premium revenue recognized in current period: Earned current period | 17,073 | 12,921 | 37,849 | 30,935 |
Amount of quality incentive premium revenue recognized in current period: Earned prior periods | (609) | 208 | 10,862 | 3,412 |
Total amount of quality incentive premium revenue recognized in current period: | 16,464 | 13,129 | 48,711 | 34,347 |
Total premium revenue recognized for state health plans with quality incentive premiums | $ 2,517,474 | $ 1,818,375 | $ 7,396,280 | $ 5,005,444 |
Minimum | California, Illinois, New Mexico, Ohio, South Carolina, Texas, Washington, and Wisconsin | ||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||
Percentage of additional incremental revenue earned | 1.00% | |||
Maximum | California, Illinois, New Mexico, Ohio, South Carolina, Texas, Washington, and Wisconsin | ||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ||||
Percentage of additional incremental revenue earned | 4.00% |
Net Income per Share - Summary
Net Income per Share - Summary of Denominators for Computation of Basic and Diluted Earnings Per Share (Detail) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Shares outstanding at the beginning of the period | 54,788 | 46,494 | 48,578 | 45,871 | ||
Weighted-average number of shares issued: | ||||||
Common stock offering | 0 | 0 | 2,393 | 0 | ||
Issued, 3.75% Notes and 3.75% Exchange | [1] | 0 | 460 | 0 | 155 | |
Share-based compensation | 15 | 37 | 295 | 409 | ||
Denominator for basic net income per share | 54,803 | 46,991 | 51,266 | 46,435 | ||
Effect of dilutive securities: | ||||||
Share-based compensation | 353 | 365 | 417 | 441 | ||
Convertible senior notes | [1] | 1,126 | 1,288 | 602 | 1,212 | |
1.125% Warrants | [1] | 3,696 | 0 | 2,414 | 0 | |
Denominator for diluted net income per share | 59,978 | 48,644 | 54,699 | 48,088 | ||
3.75% Notes | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Percentage of contractual interest rate on Notes | 3.75% | 3.75% | 3.75% | 3.75% | ||
Restricted shares | ||||||
Effect of dilutive securities: | ||||||
Potentially dilutive common shares excluded from calculations | [2] | 0 | 0 | 3 | 0 | |
1.125% Warrants | ||||||
Effect of dilutive securities: | ||||||
Potentially dilutive common shares excluded from calculations | [2] | 0 | 13,490 | 0 | 13,490 | |
Gain on 1.125% Call Option | ||||||
Effect of dilutive securities: | ||||||
Percentage of contractual interest rate on Call Option | 1.125% | 1.125% | 1.125% | 1.125% | 1.125% | |
[1] | For more information regarding the convertible senior notes, refer to Note 11, "Debt." For more information regarding the 1.125% Warrants, refer to Note 12, "Derivatives." | |||||
[2] | The dilutive effect of all potentially dilutive common shares is calculated using the treasury-stock method. Certain potentially dilutive common shares issuable are not included in the computation of diluted net income per share because to do so would be anti-dilutive. For the three and nine months ended September 30, 2014, the 1.125% Warrants were excluded from diluted shares outstanding because the exercise price exceeded the average market price of our common stock. |
Business Combinations (Details)
Business Combinations (Details) member in Thousands, $ in Millions | Sep. 01, 2015USD ($)member | Aug. 01, 2015USD ($)member | Dec. 31, 2014USD ($)member | Sep. 30, 2015member | Mar. 31, 2015USD ($) |
Florida | Preferred Medical Plan, Inc. | |||||
Business Acquisition [Line Items] | |||||
Final purchase price of business acquisition | $ 8.2 | ||||
Number of members added | member | 23 | ||||
Florida | First Coast Advantage, LLC | |||||
Business Acquisition [Line Items] | |||||
Final purchase price of business acquisition | $ 44.6 | ||||
Number of members added | member | 62 | ||||
Gross payments to acquire businesses | $ 36.6 | $ 8 | |||
Michigan | HealthPlus of Michigan and HealthPlus Partners, Inc. | |||||
Business Acquisition [Line Items] | |||||
Final purchase price of business acquisition | $ 61.1 | ||||
Number of members added | member | 88 | 88 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Jun. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Reversal of share-based compensation expense | $ (6,985) | $ (5,659) | $ (16,226) | $ (16,115) | |
Restricted shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation expense | $ 30,100 | $ 30,100 | |||
Weighted average period | 1 year 7 months | ||||
Restricted and Performance Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Fair value of restricted and performance stock awards granted | $ 27,900 | 24,800 | |||
Total fair value of restricted shares vested | $ 25,200 | $ 22,500 | |||
2011 Plan | Executive Officer | Restricted shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of nonvested shares outstanding | 475 | 475 | |||
Number of restricted share awards expected to be met in full | 297 | 297 | |||
Number of shares forfeited | 178 | ||||
Reversal of share-based compensation expense | $ 2,600 |
Share-Based Compensation - Expe
Share-Based Compensation - Expenses Charged to General and Administrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | $ 6,985 | $ 5,659 | $ 16,226 | $ 16,115 |
Restricted stock and performance awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | 5,707 | 4,774 | 12,962 | 13,596 |
Employee stock purchase plan and stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | $ 1,278 | $ 885 | $ 3,264 | $ 2,519 |
Share-Based Compensation - Rest
Share-Based Compensation - Restricted Share Activity (Details) - Restricted stock and performance awards | 9 Months Ended |
Sep. 30, 2015$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Beginning Balance, Shares | shares | 1,282,072 |
Granted, Shares | shares | 428,223 |
Vested, Shares | shares | (397,115) |
Forfeited, Shares | shares | (47,759) |
Ending Balance, Shares | shares | 1,265,421 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Begining Balance, Weighted Average Grant Date Fair Value | $ 33.55 |
Granted, Weighted Average Grant Date Fair Value | 64.25 |
Vested, Weighted Average Grant Date Fair Value | 33.39 |
Forfeited, Weighted Average Grant Date Fair Value | 37.51 |
Ending Balance, Weighted Average Grant Date Fair Value | $ 43.84 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Participant | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
Auction rate securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Minimum participants in valuation data pool | 10,000 | ||
1.125% Call Option | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Percentage of contractual interest rate on Call Option | 1.125% | 1.125% | 1.125% |
1.125% Notes | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Percentage of contractual interest rate on Notes | 1.125% | 1.125% |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Financial Instruments on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | $ 1,953,909 | $ 1,353,632 | |
Total liability measured at fair value on a recurring basis | 490,440 | 329,694 | |
Fair Value, Measurements, Recurring | Corporate debt securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 938,284 | 641,729 | |
Fair Value, Measurements, Recurring | Municipal securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 201,921 | 127,045 | |
Fair Value, Measurements, Recurring | GSEs | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 133,624 | 122,269 | |
Fair Value, Measurements, Recurring | U.S. treasury notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 74,943 | 59,543 | |
Fair Value, Measurements, Recurring | Certificates of deposit | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 84,593 | 68,876 | |
Fair Value, Measurements, Recurring | Asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 27,282 | ||
Fair Value, Measurements, Recurring | Mortgage-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 820 | ||
Fair Value, Measurements, Recurring | Subtotal - current investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 1,461,467 | 1,019,462 | |
Fair Value, Measurements, Recurring | Auction rate securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 2,355 | 4,847 | |
Fair Value, Measurements, Recurring | 1.125% Call Option derivative asset | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 490,087 | 329,323 | |
Fair Value, Measurements, Recurring | 1.125% Conversion Option derivative liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
1.125% Conversion Option derivative liability | 489,940 | 329,194 | |
Fair Value, Measurements, Recurring | Contingent consideration liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration liability | 500 | 500 | |
Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 208,567 | 181,812 | |
Total liability measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Corporate debt securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Municipal securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 1 | GSEs | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 133,624 | 122,269 | |
Fair Value, Measurements, Recurring | Level 1 | U.S. treasury notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 74,943 | 59,543 | |
Fair Value, Measurements, Recurring | Level 1 | Certificates of deposit | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | ||
Fair Value, Measurements, Recurring | Level 1 | Mortgage-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | ||
Fair Value, Measurements, Recurring | Level 1 | Subtotal - current investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 208,567 | 181,812 | |
Fair Value, Measurements, Recurring | Level 1 | Auction rate securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 1 | 1.125% Call Option derivative asset | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 1 | 1.125% Conversion Option derivative liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
1.125% Conversion Option derivative liability | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Contingent consideration liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration liability | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 1,252,900 | 837,650 | |
Total liability measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 2 | Corporate debt securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 938,284 | 641,729 | |
Fair Value, Measurements, Recurring | Level 2 | Municipal securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 201,921 | 127,045 | |
Fair Value, Measurements, Recurring | Level 2 | GSEs | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 2 | U.S. treasury notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 2 | Certificates of deposit | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 84,593 | 68,876 | |
Fair Value, Measurements, Recurring | Level 2 | Asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 27,282 | ||
Fair Value, Measurements, Recurring | Level 2 | Mortgage-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 820 | ||
Fair Value, Measurements, Recurring | Level 2 | Subtotal - current investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 1,252,900 | 837,650 | |
Fair Value, Measurements, Recurring | Level 2 | Auction rate securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 2 | 1.125% Call Option derivative asset | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 2 | 1.125% Conversion Option derivative liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
1.125% Conversion Option derivative liability | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 2 | Contingent consideration liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration liability | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 492,442 | 334,170 | |
Total liability measured at fair value on a recurring basis | 490,440 | 329,694 | |
Fair Value, Measurements, Recurring | Level 3 | Corporate debt securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 3 | Municipal securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 3 | GSEs | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 3 | U.S. treasury notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 3 | Certificates of deposit | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 3 | Asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | ||
Fair Value, Measurements, Recurring | Level 3 | Mortgage-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | ||
Fair Value, Measurements, Recurring | Level 3 | Subtotal - current investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 3 | Auction rate securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 2,355 | 4,847 | |
Fair Value, Measurements, Recurring | Level 3 | 1.125% Call Option derivative asset | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets measured at fair value on a recurring basis | 490,087 | 329,323 | |
Fair Value, Measurements, Recurring | Level 3 | 1.125% Conversion Option derivative liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
1.125% Conversion Option derivative liability | 489,940 | 329,194 | |
Fair Value, Measurements, Recurring | Level 3 | Contingent consideration liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration liability | $ 500 | $ 500 | |
1.125% Call Option | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Percentage of contractual interest rate on Call Option | 1.125% | 1.125% | 1.125% |
1.125% Notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Percentage of contractual interest rate on Notes | 1.125% | 1.125% |
Fair Value Measurements - Fai47
Fair Value Measurements - Fair Value of Assets Measured on Recurring Basis Using Unobservable Inputs (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Auction rate securities | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning Balance | $ 4,847 |
Total gains for the period recognized in other expenses, net | 0 |
Total gains for the period recognized in other comprehensive income | 108 |
Settlements | (2,600) |
Ending Balance | 2,355 |
Derivatives, Net | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning Balance | 129 |
Total gains for the period recognized in other expenses, net | 18 |
Total gains for the period recognized in other comprehensive income | 0 |
Settlements | 0 |
Ending Balance | 147 |
Contingent Consideration Liability | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning Balance | (500) |
Total gains for the period recognized in other expenses, net | 0 |
Total gains for the period recognized in other comprehensive income | 0 |
Settlements | 0 |
Ending Balance | $ (500) |
Fair Value Measurements - Detai
Fair Value Measurements - Details of Long-Term Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
1.125% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Percentage of contractual interest rate on Notes | 1.125% | 1.125% |
1.625% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Percentage of contractual interest rate on Notes | 1.625% | 1.625% |
Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | $ 0 | $ 0 |
Level 1 | 1.125% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 0 | 0 |
Level 1 | 1.625% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 0 | 0 |
Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 1,353,614 | 1,104,669 |
Level 2 | 1.125% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 960,515 | 767,377 |
Level 2 | 1.625% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 393,099 | 337,292 |
Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 0 | 0 |
Level 3 | 1.125% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 0 | 0 |
Level 3 | 1.625% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 0 | 0 |
Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 725,354 | 704,097 |
Carrying Value | 1.125% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 450,304 | 435,330 |
Carrying Value | 1.625% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 275,050 | 268,767 |
Total Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 1,353,614 | 1,104,669 |
Total Fair Value | 1.125% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | 960,515 | 767,377 |
Total Fair Value | 1.625% Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | $ 393,099 | $ 337,292 |
Investments - Summary of Invest
Investments - Summary of Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 1,464,936 | $ 1,025,951 |
Gross Unrealized Gains | 1,361 | 395 |
Gross Unrealized Losses | 2,475 | 2,037 |
Estimated Fair Value | 1,463,822 | 1,024,309 |
Subtotal - current investments | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 1,462,436 | 1,020,851 |
Gross Unrealized Gains | 1,361 | 395 |
Gross Unrealized Losses | 2,330 | 1,784 |
Estimated Fair Value | 1,461,467 | 1,019,462 |
Corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 939,611 | 642,910 |
Gross Unrealized Gains | 668 | 201 |
Gross Unrealized Losses | 1,995 | 1,382 |
Estimated Fair Value | 938,284 | 641,729 |
Municipal securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 201,876 | 127,185 |
Gross Unrealized Gains | 317 | 129 |
Gross Unrealized Losses | 272 | 269 |
Estimated Fair Value | 201,921 | 127,045 |
GSEs | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 133,528 | 122,317 |
Gross Unrealized Gains | 126 | 34 |
Gross Unrealized Losses | 30 | 82 |
Estimated Fair Value | 133,624 | 122,269 |
U.S. treasury notes | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 74,724 | 59,546 |
Gross Unrealized Gains | 219 | 30 |
Gross Unrealized Losses | 0 | 33 |
Estimated Fair Value | 74,943 | 59,543 |
Certificates of deposit | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 84,615 | 68,893 |
Gross Unrealized Gains | 4 | 1 |
Gross Unrealized Losses | 26 | 18 |
Estimated Fair Value | 84,593 | 68,876 |
Asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 27,265 | |
Gross Unrealized Gains | 24 | |
Gross Unrealized Losses | 7 | |
Estimated Fair Value | 27,282 | |
Mortgage-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 817 | |
Gross Unrealized Gains | 3 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Value | 820 | |
Auction rate securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 2,500 | 5,100 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 145 | 253 |
Estimated Fair Value | $ 2,355 | $ 4,847 |
Investments - Contractual Matur
Investments - Contractual Maturities of Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Investments, Debt and Equity Securities [Abstract] | ||
Due in one year or less, Cost | $ 659,930 | |
Due one year through five years, Cost | 771,762 | |
Due after five years through ten years, Cost | 30,744 | |
Due after ten years, Cost | 2,500 | |
Amortized Cost | 1,464,936 | $ 1,025,951 |
Due in one year or less, Estimated Fair Value | 659,729 | |
Due one year through five years, Estimated Fair Value | 770,930 | |
Due after five years through ten years, Estimated Fair Value | 30,808 | |
Due after ten years, Estimated Fair Value | 2,355 | |
Total, Estimated Fair Value | $ 1,463,822 |
Investments - Available-for-Sal
Investments - Available-for-Sale Investments (Details) $ in Thousands | Sep. 30, 2015USD ($)Security | Dec. 31, 2014USD ($)Security |
Schedule of Available-for-sale Securities [Line Items] | ||
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | $ 601,153 | $ 539,475 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | $ 1,864 | $ 1,439 |
In a Continuous Loss Position for Less than 12 Months, Number of Positions | Security | 595 | 416 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | $ 151,286 | $ 47,576 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | $ 611 | $ 598 |
In a Continuous Loss Position for 12 Months or More, Number of Positions | Security | 98 | 32 |
Corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | $ 408,736 | $ 379,034 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | $ 1,611 | $ 1,151 |
In a Continuous Loss Position for Less than 12 Months, Number of Positions | Security | 300 | 265 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | $ 136,776 | $ 28,668 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | $ 384 | $ 231 |
In a Continuous Loss Position for 12 Months or More, Number of Positions | Security | 80 | 10 |
Municipal securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | $ 88,681 | $ 53,626 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | $ 190 | $ 168 |
In a Continuous Loss Position for Less than 12 Months, Number of Positions | Security | 110 | 64 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | $ 12,155 | $ 11,075 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | $ 82 | $ 101 |
In a Continuous Loss Position for 12 Months or More, Number of Positions | Security | 15 | 13 |
GSEs | ||
Schedule of Available-for-sale Securities [Line Items] | ||
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | $ 51,393 | $ 75,025 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | $ 30 | $ 69 |
In a Continuous Loss Position for Less than 12 Months, Number of Positions | Security | 17 | 22 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | $ 0 | $ 2,986 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | $ 0 | $ 13 |
In a Continuous Loss Position for 12 Months or More, Number of Positions | Security | 0 | 3 |
U.S. treasury notes | ||
Schedule of Available-for-sale Securities [Line Items] | ||
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | $ 19,199 | |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | $ 33 | |
In a Continuous Loss Position for Less than 12 Months, Number of Positions | Security | 13 | |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | $ 0 | |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | $ 0 | |
In a Continuous Loss Position for 12 Months or More, Number of Positions | Security | 0 | |
Certificates of deposit | ||
Schedule of Available-for-sale Securities [Line Items] | ||
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | $ 35,654 | $ 12,591 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | $ 26 | $ 18 |
In a Continuous Loss Position for Less than 12 Months, Number of Positions | Security | 148 | 52 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | $ 0 | $ 0 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | $ 0 | $ 0 |
In a Continuous Loss Position for 12 Months or More, Number of Positions | Security | 0 | 0 |
Asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | $ 16,689 | |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | $ 7 | |
In a Continuous Loss Position for Less than 12 Months, Number of Positions | Security | 20 | |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | $ 0 | |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | $ 0 | |
In a Continuous Loss Position for 12 Months or More, Number of Positions | Security | 0 | |
Auction rate securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | $ 0 | $ 0 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | $ 0 | $ 0 |
In a Continuous Loss Position for Less than 12 Months, Number of Positions | Security | 0 | 0 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | $ 2,355 | $ 4,847 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | $ 145 | $ 253 |
In a Continuous Loss Position for 12 Months or More, Number of Positions | Security | 3 | 6 |
Receivables - Summary of Accoun
Receivables - Summary of Accounts Receivable (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | $ 619,891 | $ 596,456 |
Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 595,326 | 561,465 |
Medicaid Solutions Segment | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 24,565 | 34,991 |
California | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 108,972 | 310,938 |
Florida | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 23,096 | 2,141 |
Illinois | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 78,159 | 31,594 |
Michigan | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 49,348 | 19,880 |
New Mexico | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 87,493 | 49,609 |
Ohio | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 102,786 | 45,187 |
Puerto Rico | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 14,430 | 0 |
South Carolina | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 6,626 | 4,134 |
Texas | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 41,531 | 29,348 |
Utah | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 11,595 | 6,389 |
Washington | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 38,999 | 42,848 |
Wisconsin | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | 26,530 | 8,102 |
Direct delivery and other | Health Plans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total receivables | $ 5,761 | $ 11,295 |
Restricted Investments - Summar
Restricted Investments - Summary of Restricted Investments by Health Plan (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | $ 101,970 | $ 102,479 |
Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 101,970 | 97,478 |
Medicaid Solutions Segment | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 0 | 5,001 |
California | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 373 | 373 |
Florida | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 27,029 | 28,649 |
Illinois | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 311 | 311 |
Michigan | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 1,014 | 1,014 |
New Mexico | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 42,645 | 35,135 |
Ohio | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 11,726 | 12,719 |
Puerto Rico | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 10,098 | 5,097 |
South Carolina | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 310 | 6,040 |
Texas | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 3,502 | 3,500 |
Utah | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 3,616 | 3,601 |
Washington | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 151 | 151 |
Wisconsin | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | 953 | 0 |
Direct delivery and other | Health Plans | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted investments by health plan | $ 242 | $ 888 |
Restricted Investments - Contra
Restricted Investments - Contractual Maturities of Our Held-to-Maturity Restricted Investments (Details) $ in Thousands | Sep. 30, 2015USD ($) |
Investments, Debt and Equity Securities [Abstract] | |
Amortized Cost, Due in one year or less | $ 91,518 |
Amortized Cost, Due one year through five years | 10,452 |
Amortized Cost, Total | 101,970 |
Estimated Fair Value, Due in one year or less | 91,519 |
Estimated Fair Value, Due one year through five years | 10,464 |
Estimated Fair Value, Total | $ 101,983 |
Medical Claims and Benefits P55
Medical Claims and Benefits Payable - Medical Claims and Future Benefits (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Other Liabilities Disclosure [Abstract] | |||
Fee-for-service claims incurred but not paid (IBNP) | $ 1,184,147 | $ 870,429 | |
Pharmacy payable | 93,953 | 71,412 | |
Capitation payable | 30,061 | 28,150 | |
Other Claims Payable | 251,409 | 230,531 | |
Medical claims and benefits payable | $ 1,559,570 | $ 1,200,522 | $ 669,787 |
Medical Claims and Benefits P56
Medical Claims and Benefits Payable - Components of Change in Medical Claims and Benefits Payable (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | ||
Insurance Claims [Roll Forward] | |||
Medical claims and benefits payable, beginning balance | $ 1,200,522 | $ 669,787 | |
Components of medical care costs related to: | |||
Current period | 8,723,573 | 8,122,885 | |
Prior periods | [1] | (142,948) | (45,979) |
Total medical care costs | 8,580,625 | 8,076,906 | |
Change in non-risk provider payables | 42,067 | (31,973) | |
Payments for medical care costs related to: | |||
Current period | 7,371,504 | 7,064,427 | |
Prior periods | 892,140 | 449,771 | |
Total paid | 8,263,644 | 7,514,198 | |
Medical claims and benefits payable, ending balance | $ 1,559,570 | $ 1,200,522 | |
Benefit from prior period as a percentage of: | |||
Balance at beginning of period | 11.90% | 6.90% | |
Premium revenue, trailing twelve months | 1.20% | 0.50% | |
Medical care costs, trailing twelve months | 1.30% | 0.60% | |
Prior period adjustment expense related to programs with medical cost floor or corridor provisions | [1] | $ 23,000 | |
[1] | The benefit from prior period development of medical claims and benefits payable for the nine months ended September 30, 2015 included approximately $23 million relating to programs that contain medical cost floor or corridor provisions. Accordingly, premium revenue for the nine months ended September 30, 2015 was reduced by the same amount. |
Medical Claims and Benefits P57
Medical Claims and Benefits Payable (Details) member in Thousands, $ in Thousands | Sep. 01, 2015member | Sep. 30, 2015USD ($)member | Sep. 30, 2015USD ($)member | Sep. 30, 2015USD ($) | Dec. 31, 2014USD ($)member | |
Insurance Claims [Line Items] | ||||||
Non-risk provider payables | $ | $ 161,400 | $ 161,400 | $ 161,400 | $ 119,300 | ||
Favorable prior period claims development | $ | [1] | $ 142,948 | $ 45,979 | |||
Minimum | ||||||
Insurance Claims [Line Items] | ||||||
Percentage of liability for unpaid claims not paid out | 8.00% | 8.00% | 8.00% | |||
Maximum | ||||||
Insurance Claims [Line Items] | ||||||
Percentage of liability for unpaid claims not paid out | 10.00% | 10.00% | 10.00% | |||
Michigan | HealthPlus of Michigan and HealthPlus Partners, Inc. | ||||||
Insurance Claims [Line Items] | ||||||
Number of members added | 88 | 88 | ||||
Texas | MMP Integrated Dual | ||||||
Insurance Claims [Line Items] | ||||||
Number of members added | 15 | |||||
Ohio | MMP Integrated Dual | ||||||
Insurance Claims [Line Items] | ||||||
Number of members added | 17 | |||||
Ohio | Medicaid Expansion | ||||||
Insurance Claims [Line Items] | ||||||
Number of members added | 61 | |||||
California | Medicaid Expansion | ||||||
Insurance Claims [Line Items] | ||||||
Number of members added | 100 | |||||
[1] | The benefit from prior period development of medical claims and benefits payable for the nine months ended September 30, 2015 included approximately $23 million relating to programs that contain medical cost floor or corridor provisions. Accordingly, premium revenue for the nine months ended September 30, 2015 was reduced by the same amount. |
Debt (Details)
Debt (Details) | Jun. 12, 2015USD ($)guarantor | Sep. 30, 2014USD ($)d$ / shares | Feb. 28, 2013USD ($)propertyd$ / shares | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($)$ / shares | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($)$ / shares | Dec. 31, 2014USD ($) | Dec. 31, 2013 |
Convertible Debt [Abstract] | |||||||||
Face amount of debts | $ 851,551,000 | $ 851,551,000 | $ 851,551,000 | ||||||
Sale Leaseback Transaction, Net Book Value [Abstract] | |||||||||
Interest expense | 15,269,000 | $ 14,419,000 | 45,091,000 | $ 42,234,000 | |||||
Property, equipment, and capitalized software, net | 374,862,000 | 374,862,000 | 340,778,000 | ||||||
1.625% Notes | |||||||||
Convertible Debt [Abstract] | |||||||||
Face amount of debts | $ 301,551,000 | $ 301,551,000 | $ 301,551,000 | ||||||
Percentage of contractual interest rate on Notes | 1.625% | 1.625% | 1.625% | ||||||
1.125% Notes | |||||||||
Convertible Debt [Abstract] | |||||||||
Face amount of debts | $ 550,000,000 | $ 550,000,000 | $ 550,000,000 | ||||||
Percentage of contractual interest rate on Notes | 1.125% | 1.125% | 1.125% | ||||||
Initial conversation rate on Notes | 0.0245277 | ||||||||
Senior note effective interest rate (in percent) | 6.00% | 6.00% | |||||||
Senior notes amortization period | 4 years 3 months | ||||||||
Convertible debt, if-converted value in excess of principal | $ 458,000,000 | $ 93,000,000 | |||||||
June 2013 Transactions | |||||||||
Sale Leaseback Transaction, Net Book Value [Abstract] | |||||||||
Sale leaseback transaction term of lease | 25 years | ||||||||
Annual rental payments increase, percentage | 3.00% | ||||||||
Interest expense | 9,400,000 | 9,300,000 | |||||||
February 2013 Transactions | Construction projects | |||||||||
Sale Leaseback Transaction, Net Book Value [Abstract] | |||||||||
Interest expense | 3,000,000 | 2,200,000 | |||||||
Property, equipment, and capitalized software, net | $ 36,500,000 | 36,500,000 | |||||||
Lease financing obligations | 40,300,000 | 40,300,000 | $ 40,600,000 | ||||||
Rent expense related to ground leases | 900,000 | 800,000 | |||||||
Property Subject to Operating Lease | 6th & Pine Development, LLC | |||||||||
Sale Leaseback Transaction, Net Book Value [Abstract] | |||||||||
Number of office buildings leased | property | 2 | ||||||||
Senior Notes | 1.125% Notes | |||||||||
Convertible Debt [Abstract] | |||||||||
Face amount of debts | $ 550,000,000 | ||||||||
Percentage of contractual interest rate on Notes | 1.125% | ||||||||
Conversion price per share of common stock | $ / shares | $ 40.77 | ||||||||
Current portion of long-term debt to be converted within 12 months | $ 450,300,000 | $ 450,300,000 | |||||||
Convertible Debt | 1.625% Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Term of debt instrument | 4 years | ||||||||
Convertible Debt [Abstract] | |||||||||
Face amount of debts | $ 301,551,000 | $ 301,551,000 | $ 301,551,000 | ||||||
Percentage of contractual interest rate on Notes | 1.625% | 1.625% | 1.625% | ||||||
Initial conversation rate on Notes | 0.0172157 | ||||||||
Conversion price per share of common stock | $ / shares | $ 58.09 | $ 58.09 | $ 58.09 | ||||||
Senior note effective interest rate (in percent) | 5.00% | 5.00% | |||||||
Convertible debt, if-converted value in excess of principal | $ 89,000,000 | ||||||||
Extinguishment of Debt Disclosures [Abstract] | |||||||||
Frequency of periodic payment on Senior Notes | semiannually | ||||||||
Date of first required payment | Feb. 15, 2015 | ||||||||
Additional interest payable for any semiannual interest period with 1.625% Notes outstanding less than $100 million | 0.25% | ||||||||
Minimum 1.625% Notes outstanding balance threshold for additional interest payable | $ 100,000,000 | $ 100,000,000 | $ 100,000,000 | ||||||
Senior Notes [Abstract] | |||||||||
Redemption period start date | Aug. 19, 2018 | ||||||||
Redemption price of the principal amount (in percent) | 100.00% | ||||||||
Debt discount amortization period | 2 years 11 months | ||||||||
Convertible debt carrying amount of equity component | $ 22,900,000 | $ 22,900,000 | |||||||
Redemption period, option one | Senior Notes | 1.625% Notes | |||||||||
Convertible Debt [Abstract] | |||||||||
Debt convertible threshold trading days | d | 20 | ||||||||
Debt convertible threshold consecutive trading days | 30 days | ||||||||
Debt convertible threshold percentage of stock price trigger | 130.00% | ||||||||
Redemption period, option one | Senior Notes | 1.125% Notes | |||||||||
Convertible Debt [Abstract] | |||||||||
Debt convertible threshold trading days | d | 20 | ||||||||
Debt convertible threshold consecutive trading days | 30 days | ||||||||
Debt convertible threshold percentage of stock price trigger | 130.00% | ||||||||
Redemption period, option two | Senior Notes | 1.625% Notes | |||||||||
Convertible Debt [Abstract] | |||||||||
Debt convertible threshold trading days | d | 5 | ||||||||
Debt convertible threshold consecutive trading days | 5 days | ||||||||
Debt convertible maximum threshold percentage of stock price | 98.00% | ||||||||
Redemption period, option two | Senior Notes | 1.125% Notes | |||||||||
Convertible Debt [Abstract] | |||||||||
Debt convertible threshold trading days | d | 5 | ||||||||
Debt convertible threshold consecutive trading days | 5 days | ||||||||
Debt convertible maximum threshold percentage of stock price | 98.00% | ||||||||
August 19, 2018 | Convertible Debt | 1.625% Notes | |||||||||
Senior Notes [Abstract] | |||||||||
Redemption period start date | Aug. 19, 2018 | ||||||||
Redemption period end date | Aug. 19, 2018 | ||||||||
August 19, 2024 | Convertible Debt | 1.625% Notes | |||||||||
Senior Notes [Abstract] | |||||||||
Redemption period start date | Aug. 19, 2024 | ||||||||
Redemption period end date | Aug. 19, 2024 | ||||||||
August 19, 2029 | Convertible Debt | 1.625% Notes | |||||||||
Senior Notes [Abstract] | |||||||||
Redemption period start date | Aug. 19, 2029 | ||||||||
Redemption period end date | Aug. 19, 2029 | ||||||||
August 19, 2034 | Convertible Debt | 1.625% Notes | |||||||||
Senior Notes [Abstract] | |||||||||
Redemption period start date | Aug. 19, 2034 | ||||||||
Redemption period end date | Aug. 19, 2034 | ||||||||
August 19, 2039 | Convertible Debt | 1.625% Notes | |||||||||
Senior Notes [Abstract] | |||||||||
Redemption period start date | Aug. 19, 2039 | ||||||||
Redemption period end date | Aug. 19, 2039 | ||||||||
Revolving Credit Facility | Unsecured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | $ 250,000,000 | ||||||||
Term of debt instrument | 5 years | ||||||||
Potential maximum borrowing capacity | $ 350,000,000 | ||||||||
Current borrowing capacity | 245,000,000 | $ 245,000,000 | |||||||
Amount outstanding under the Credit Facility | 0 | 0 | |||||||
Frequency of commitment fee payment | quarterly | ||||||||
Number of guarantors (in guarantor) | guarantor | 2 | ||||||||
Ratio of indebtedness to EBITDA | 4 | ||||||||
Letter of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Amount outstanding under Letter of Credit | $ 5,000,000 | $ 5,000,000 |
Debt - Maturities of Long-Term
Debt - Maturities of Long-Term Debt (Details) $ in Thousands | Sep. 30, 2015USD ($) | |
Schedule of Maturities of Long-term Debt [Line Items] | ||
Total | $ 851,551 | |
2,015 | 0 | |
2,016 | 0 | |
2,017 | 0 | |
2,018 | 0 | |
2,019 | 0 | |
Thereafter | 851,551 | |
1.125% Notes | ||
Schedule of Maturities of Long-term Debt [Line Items] | ||
Total | 550,000 | |
2,015 | 0 | |
2,016 | 0 | |
2,017 | 0 | |
2,018 | 0 | |
2,019 | 0 | |
Thereafter | 550,000 | |
1.625% Notes | ||
Schedule of Maturities of Long-term Debt [Line Items] | ||
Total | 301,551 | [1] |
2,015 | 0 | [1] |
2,016 | 0 | [1] |
2,017 | 0 | [1] |
2,018 | 0 | [1] |
2,019 | 0 | [1] |
Thereafter | $ 301,551 | [1] |
[1] | The 1.625% Notes have a contractual maturity date in 2044; however, on specified dates beginning in 2018 as described below, holders of the 1.625% Notes may require us to repurchase some or all of the 1.625% Notes, or we may redeem any or all of the 1.625% Notes. |
Debt - Schedule of Long-Term De
Debt - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Details of the liability component: | ||
Principal Balance | $ 851,551 | $ 851,551 |
Unamortized Discount | 126,197 | 147,454 |
Net Carrying Amount | 725,354 | 704,097 |
1.125% Notes | ||
Details of the liability component: | ||
Principal Balance | 550,000 | 550,000 |
Unamortized Discount | 99,696 | 114,670 |
Net Carrying Amount | 450,304 | 435,330 |
1.625% Notes | ||
Details of the liability component: | ||
Principal Balance | 301,551 | 301,551 |
Unamortized Discount | 26,501 | 32,784 |
Net Carrying Amount | $ 275,050 | $ 268,767 |
Debt - Interest Cost Recognized
Debt - Interest Cost Recognized (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Interest cost recognized for the period relating to the: | ||||
Contractual interest coupon rate | $ 2,772 | $ 3,132 | $ 8,316 | $ 9,732 |
Amortization of the discount | 7,185 | 6,455 | 21,257 | 19,183 |
Total interest cost recognized | $ 9,957 | $ 9,587 | $ 29,573 | $ 28,915 |
Derivatives - Fair Value on Con
Derivatives - Fair Value on Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
1.125% Call Option | |||
Derivative [Line Items] | |||
Percentage of contractual interest rate on Call Option | 1.125% | 1.125% | 1.125% |
Current assets | 1.125% Call Option | |||
Derivative [Line Items] | |||
Derivative assets | $ 490,087 | $ 0 | |
Non-current asset | 1.125% Call Option | |||
Derivative [Line Items] | |||
Derivative assets | 0 | 329,323 | |
Current liabilities | 1.125% Conversion Option derivative liability | |||
Derivative [Line Items] | |||
Derivative liabilities | 489,940 | 0 | |
Non-current liabilities | 1.125% Conversion Option derivative liability | |||
Derivative [Line Items] | |||
Derivative liabilities | $ 0 | $ 329,194 | |
1.125% Notes | |||
Derivative [Line Items] | |||
Percentage of contractual interest rate on Notes | 1.125% | 1.125% |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Feb. 25, 2015 | |
Class of Stock [Line Items] | ||||||
Increase in stockholders' equity | $ 507,600,000 | |||||
Net income | $ 46,299,000 | $ 16,122,000 | 113,395,000 | $ 28,431,000 | ||
Income tax benefit related to share-based compensation | 20,700,000 | |||||
Proceeds from common stock offering, net of issuance costs | $ 373,200,000 | $ 373,151,000 | $ 0 | |||
Warrants issued | 13,490,236 | |||||
Warrant, strike price per share | $ 53.8475 | $ 53.8475 | ||||
Trading days measurement period | 160 days | |||||
Stated percentage of warrants | 1.125% | 1.125% | ||||
Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Number of shares issued in connection with an underwritten public offering | 5,750,000 | |||||
Share price in the offering (dollars per share) | $ 64.90 | |||||
Number of common stock issued | 480,000 | |||||
February 2015 Repurchase Program | Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Authorized repurchase amount | $ 50,000,000 |
Segment Information (Details)
Segment Information (Details) | 9 Months Ended |
Sep. 30, 2015Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Segment Information - Schedule
Segment Information - Schedule of Operating Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Health Plans: | ||||
Premium revenue | $ 3,377,030 | $ 2,316,759 | $ 9,652,054 | $ 6,424,238 |
Premium tax revenue | 99,047 | 81,240 | 289,003 | 203,053 |
Health insurer fee revenue | 81,158 | 29,427 | 202,996 | 67,785 |
Investment income | 4,832 | 2,041 | 11,675 | 5,615 |
Other revenue | 1,745 | 2,327 | 4,996 | 8,523 |
Molina Medicaid Solutions: | ||||
Service revenue | 47,551 | 52,557 | 146,652 | 156,419 |
Total revenue | 3,611,363 | 2,484,351 | 10,307,376 | 6,865,633 |
Income from continuing operations before income tax expense: | ||||
Operating income, continuing operations | 112,853 | 39,779 | 310,711 | 96,473 |
Other expenses, net | 15,229 | 15,282 | 45,009 | 43,044 |
Income from continuing operations before income tax expense | 97,624 | 24,497 | 265,702 | 53,429 |
Health Plans | ||||
Health Plans: | ||||
Premium revenue | 3,377,030 | 2,316,759 | 9,652,054 | 6,424,238 |
Premium tax revenue | 99,047 | 81,240 | 289,003 | 203,053 |
Health insurer fee revenue | 81,158 | 29,427 | 202,996 | 67,785 |
Investment income | 4,832 | 2,041 | 11,675 | 5,615 |
Other revenue | 1,745 | 2,327 | 4,996 | 8,523 |
Income from continuing operations before income tax expense: | ||||
Operating income, continuing operations | 101,899 | 29,874 | 272,924 | 65,879 |
Molina Medicaid Solutions | ||||
Molina Medicaid Solutions: | ||||
Service revenue | 47,551 | 52,557 | 146,652 | 156,419 |
Income from continuing operations before income tax expense: | ||||
Operating income, continuing operations | $ 10,954 | $ 9,905 | $ 37,787 | $ 30,594 |
Segment Information - Reconcili
Segment Information - Reconciliation to Consolidated Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Segment Reporting Information [Line Items] | ||
Assets | $ 5,915,031 | $ 4,477,215 |
Health Plans | ||
Segment Reporting Information [Line Items] | ||
Assets | 5,676,304 | 4,270,870 |
Medicaid Solutions Segment | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 238,727 | $ 206,345 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Entity Information [Line Items] | ||
Net assets of subsidiaries subject to restrictions | $ 1,072 | $ 859 |
Aggregate statutory capital and surplus | 1,166 | |
Required minimum statutory capital surplus | 592 | |
Parent Company | ||
Entity Information [Line Items] | ||
Restricted cash and investments | $ 471.8 | $ 202.6 |
Related Party Transactions (Det
Related Party Transactions (Details) - Property Subject to Operating Lease - 6th & Pine Development, LLC - property | Sep. 30, 2015 | Feb. 28, 2013 |
Related Party Transaction [Line Items] | ||
Number of office buildings leased | 2 | |
Percentage of annual rent increase | 3.40% |
Variable Interest Entities (V69
Variable Interest Entities (VIEs) (Details) - Variable Interest Entity, Primary Beneficiary - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Variable Interest Entity [Line Items] | ||
Total carrying amount of assets | $ 7.1 | $ 31.1 |
Total amount of liabilities | $ 6.8 | $ 30.8 |