Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Jan. 31, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 1-5975 | ||
Entity Registrant Name | HUMANA INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 61-0647538 | ||
Entity Address, Address Line One | 500 West Main Street | ||
Entity Address, City or Town | Louisville | ||
Entity Address, State or Province | KY | ||
Entity Address, Postal Zip Code | 40202 | ||
City Area Code | 502 | ||
Local Phone Number | 580-1000 | ||
Title of 12(b) Security | Common stock, $0.16 2/3 par value | ||
Trading Symbol | HUM | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 56,778,277,553 | ||
Entity Common Stock, Shares Outstanding | 126,633,599 | ||
Documents Incorporated by Reference | Parts II and III incorporate herein by reference portions of the Registrant’s Definitive Proxy Statement to be filed pursuant to Regulation 14A with respect to the Annual Meeting of Stockholders scheduled to be held on April 21, 2022. Such Definitive Proxy Statement will be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year to which this report relates. | ||
Entity Central Index Key | 0000049071 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2021 | |
Audit Information [Abstract] | |
Auditor Name | PricewaterhouseCoopers LLP |
Auditor Location | Louisville, Kentucky |
Auditor Firm ID | 238 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 3,394 | $ 4,673 |
Investment securities | 13,192 | 12,554 |
Receivables, less allowance for doubtful accounts of $83 in 2021 and $72 in 2020 | 1,814 | 1,138 |
Other current assets | 6,493 | 5,276 |
Total current assets | 24,893 | 23,641 |
Property and equipment, net | 3,073 | 2,371 |
Long-term investment securities | 780 | 1,212 |
Goodwill | 11,092 | 4,447 |
Equity method investments | 141 | 1,170 |
Other long-term assets | 4,379 | 2,128 |
Total assets | 44,358 | 34,969 |
Current liabilities: | ||
Benefits payable | 8,289 | 8,143 |
Trade accounts payable and accrued expenses | 4,509 | 4,013 |
Book overdraft | 326 | 320 |
Unearned revenues | 254 | 318 |
Short-term debt | 1,953 | 600 |
Total current liabilities | 15,331 | 13,394 |
Long-term debt | 10,541 | 6,060 |
Other long-term liabilities | 2,383 | 1,787 |
Total liabilities | 28,255 | 21,241 |
Commitments and contingencies (Note 17) | ||
Stockholders’ equity: | ||
Preferred stock, $1 par; 10,000,000 shares authorized; none issued | 0 | 0 |
Common stock, $0.16 2/3 par; 300,000,000 shares authorized; 198,648,742 shares issued at December 31, 2021 and December 31, 2020 | 33 | 33 |
Capital in excess of par value | 3,082 | 2,705 |
Retained earnings | 23,086 | 20,517 |
Accumulated other comprehensive income | 42 | 391 |
Treasury stock, at cost, 69,846,758 shares at December 31, 2021 and 69,787,914 shares at December 31, 2020 | (10,163) | (9,918) |
Noncontrolling interests | 23 | 0 |
Total stockholders’ equity | 16,103 | 13,728 |
Total liabilities and stockholders’ equity | $ 44,358 | $ 34,969 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Receivables, allowance for doubtful accounts | $ 83 | $ 72 |
Preferred stock, par (in dollars per share) | $ 1 | $ 1 |
Preferred stock, authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par (in dollars per share) | $ 0.1667 | $ 0.1667 |
Common stock, authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, issued (in shares) | 198,648,742 | 198,648,742 |
Treasury stock (in shares) | 69,846,758 | 69,787,914 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | |||
Services revenue, type | Health Care [Member] | Health Care [Member] | Health Care [Member] |
Revenues: | |||
Premiums | $ 79,822 | $ 74,186 | $ 62,948 |
Services | 3,055 | 1,815 | 1,439 |
Investment income | 187 | 1,154 | 501 |
Total revenues | 83,064 | 77,155 | 64,888 |
Operating expenses: | |||
Benefits | 69,199 | 61,628 | 53,857 |
Operating costs | 10,121 | 10,052 | 7,381 |
Depreciation and amortization | 596 | 489 | 458 |
Total operating expenses | 79,916 | 72,169 | 61,696 |
Income (loss) from operations | 3,148 | 4,986 | 3,192 |
Interest expense | 326 | 283 | 242 |
Other (income) expense, net | (532) | 103 | (506) |
Income before income taxes and equity in net earnings | 3,354 | 4,600 | 3,456 |
Provision for income taxes | 485 | 1,307 | 763 |
Equity in net earnings | 65 | 74 | 14 |
Net income | 2,934 | 3,367 | 2,707 |
Less: Net income attributable to noncontrolling interests | (1) | 0 | 0 |
Net income (loss) | $ 2,933 | $ 3,367 | $ 2,707 |
Basic earnings per common share (in dollars per share) | $ 22.79 | $ 25.47 | $ 20.20 |
Diluted earnings per common share (in dollars per share) | $ 22.67 | $ 25.31 | $ 20.10 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | |||
Net income attributable to Humana | $ 2,933 | $ 3,367 | $ 2,707 |
Other comprehensive income (loss): | |||
Change in gross unrealized investment (losses) gains | (356) | 393 | 450 |
Effect of income taxes | 81 | (89) | (105) |
Total change in unrealized investment (losses) gains, net of tax | (275) | 304 | 345 |
Reclassification adjustment for net realized gains included in investment income | (103) | (90) | (34) |
Effect of income taxes | 23 | 20 | 8 |
Total reclassification adjustment, net of tax | (80) | (70) | (26) |
Other comprehensive (loss) income, net of tax | (355) | 234 | 319 |
Comprehensive income (loss) attributable to equity method investments | 6 | 1 | (4) |
Comprehensive income | $ 2,584 | $ 3,602 | $ 3,022 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Millions | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Capital In Excess of Par Value | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Noncontrolling Interests |
Beginning balance (in shares) at Dec. 31, 2018 | 198,595 | ||||||||
Beginning balance at Dec. 31, 2018 | $ 10,161 | $ 33 | $ 2,535 | $ 15,072 | $ (159) | $ (7,320) | $ 0 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 2,707 | 2,707 | |||||||
Other comprehensive income (loss) | 315 | 0 | 315 | ||||||
Common stock repurchases | (1,070) | 150 | (1,220) | ||||||
Dividends and dividend equivalents | (296) | (296) | |||||||
Stock-based compensation | 163 | 163 | |||||||
Restricted stock unit vesting (in shares) | 32 | ||||||||
Restricted stock unit vesting | 0 | (48) | 48 | ||||||
Stock option exercises (in shares) | 3 | ||||||||
Stock option exercises | 57 | 20 | 37 | ||||||
Ending balance (in shares) at Dec. 31, 2019 | 198,630 | ||||||||
Ending balance at Dec. 31, 2019 | 12,037 | $ (2) | $ 33 | 2,820 | 17,483 | $ (2) | 156 | (8,455) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 3,367 | 3,367 | |||||||
Other comprehensive income (loss) | 235 | 0 | 235 | ||||||
Common stock repurchases | (1,820) | (263) | (1,557) | ||||||
Dividends and dividend equivalents | (331) | (331) | |||||||
Stock-based compensation | 181 | 181 | |||||||
Restricted stock unit vesting (in shares) | 19 | ||||||||
Restricted stock unit vesting | 0 | (59) | 59 | ||||||
Stock option exercises (in shares) | 0 | ||||||||
Stock option exercises | 61 | 26 | 35 | ||||||
Ending balance (in shares) at Dec. 31, 2020 | 198,649 | ||||||||
Ending balance at Dec. 31, 2020 | 13,728 | $ 33 | 2,705 | 20,517 | 391 | (9,918) | 0 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 2,934 | 2,933 | 1 | ||||||
Acquisition | 22 | 22 | |||||||
Other comprehensive income (loss) | (349) | (349) | |||||||
Common stock repurchases | (79) | 262 | (341) | ||||||
Dividends and dividend equivalents | (364) | (364) | |||||||
Stock-based compensation | 180 | 180 | |||||||
Restricted stock unit vesting | 0 | (81) | 81 | ||||||
Stock option exercises | 31 | 16 | 15 | ||||||
Ending balance (in shares) at Dec. 31, 2021 | 198,649 | ||||||||
Ending balance at Dec. 31, 2021 | $ 16,103 | $ 33 | $ 3,082 | $ 23,086 | $ 42 | $ (10,163) | $ 23 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities | |||
Net income | $ 2,934 | $ 3,367 | $ 2,707 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Loss (gain) on investment securities, net | 130 | (838) | (62) |
Gain on Kindred at Home equity method investment | (1,129) | 0 | 0 |
Equity in net earnings | (65) | (74) | (14) |
Stock compensation | 180 | 181 | 163 |
Depreciation | 640 | 528 | 505 |
Amortization | 73 | 88 | 70 |
Provision for deferred income taxes | 15 | 195 | 162 |
Changes in operating assets and liabilities, net of effect of businesses acquired and dispositions: | |||
Receivables | (280) | (85) | (32) |
Other assets | (491) | (581) | 118 |
Benefits payable | 104 | 2,139 | 1,142 |
Other liabilities | 176 | 599 | 471 |
Unearned revenues | (65) | 71 | (36) |
Other | 40 | 49 | 90 |
Net cash provided by operating activities | 2,262 | 5,639 | 5,284 |
Cash flows from investing activities | |||
Acquisitions, net of cash and cash equivalents acquired | (4,187) | (709) | 0 |
Purchases of property and equipment, net | (1,316) | (964) | (736) |
Purchases of investment securities | (7,197) | (9,125) | (6,361) |
Proceeds from maturities of investment securities | 2,597 | 4,986 | 1,733 |
Proceeds from sales of investment securities | 3,547 | 2,747 | 4,086 |
Net cash used in investing activities | (6,556) | (3,065) | (1,278) |
Cash flows from financing activities | |||
Withdrawals receipts from contract deposits, net | (306) | (939) | (623) |
Proceeds from issuance of senior notes, net | 2,984 | 1,088 | 987 |
Repayment of senior notes | 0 | (400) | (400) |
Proceeds (repayments) from issuance of commercial paper, net | 352 | 295 | (360) |
Proceeds from term loan | 2,500 | 1,000 | 0 |
Repayment of term loan | (2,078) | (1,000) | (650) |
Debt issue costs | (31) | 0 | 0 |
Common stock repurchases | (79) | (1,820) | (1,070) |
Dividends paid | (354) | (323) | (291) |
Change in book overdraft | 6 | 95 | 54 |
Proceeds from stock option exercises & other | 21 | 49 | 58 |
Net cash provided by (used in) financing activities | 3,015 | (1,955) | (2,295) |
(Decrease) increase in cash and cash equivalents | (1,279) | 619 | 1,711 |
Cash and cash equivalents at beginning of period | 4,673 | 4,054 | 2,343 |
Cash and cash equivalents at end of period | 3,394 | 4,673 | 4,054 |
Supplemental cash flow disclosures: | |||
Interest payments | 285 | 258 | 212 |
Income tax payments, net | 227 | 1,132 | 518 |
Details of businesses acquired in purchase transactions: | |||
Fair value of assets acquired, net of cash acquired | 9,804 | 819 | 28 |
Less: Fair value of liabilities assumed | (3,235) | (110) | (28) |
Less: Noncontrolling interests acquired | (22) | 0 | 0 |
Less: Remeasured existing Kindred at Home equity method investment | (2,360) | 0 | 0 |
Cash paid for acquired businesses, net of cash acquired | $ 4,187 | $ 709 | $ 0 |
REPORTING ENTITY
REPORTING ENTITY | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
REPORTING ENTITY | REPORTING ENTITY Nature of Operations Humana Inc., headquartered in Louisville, Kentucky, is a leading health and well-being company committed to helping our millions of medical and specialty members achieve their best health. Our successful history in care delivery and health plan administration is helping us create a new kind of integrated care with the power to improve health and well‐being and lower costs. Our efforts are leading to a better quality of life for people with Medicare, families, individuals, military service personnel, and communities at large. To accomplish that, we support physicians and other health care professionals as they work to deliver the right care in the right place for their patients, our members. Our range of clinical capabilities, resources and tools, such as in‐home care, behavioral health, pharmacy services, data analytics and wellness solutions, combine to produce a simplified experience that makes health care easier to navigate and more effective. References throughout these notes to consolidated financial statements to “we,” “us,” “our,” “Company,” and “Humana,” mean Humana Inc. and its subsidiaries. We derived approximately 83% of our total premiums and services revenue from contracts with the federal government in 2021, including 15% related to our federal government contracts with the Centers for Medicare and Medicaid Services, or CMS, to provide health insurance coverage for individual Medicare Advantage members in Florida. CMS is the federal government’s agency responsible for administering the Medicare program. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation Our financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America. Our consolidated financial statements include the accounts of Humana Inc. and subsidiaries that the Company controls, including variable interest entities associated with medical practices for which we are the primary beneficiary. We do not own many of our medical practices but instead enter into exclusive management agreements with the affiliated Professional Associations, or P.A.s, that operate these medical practices. Based upon the provisions of these agreements, these affiliated P.A.s are variable interest entities and we are the primary beneficiary, and accordingly we consolidate the affiliated P.A.s. All significant intercompany balances and transactions have been eliminated. The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The areas involving the most significant use of estimates are the estimation of benefits payable, the impact of risk adjustment provisions related to our Medicare contracts, the valuation and related impairment recognition of investment securities, and the valuation and related impairment recognition of long-lived assets, including goodwill and indefinite-lived intangible assets. These estimates are based on knowledge of current events and anticipated future events, and accordingly, actual results may ultimately differ materially from those estimates. COVID-19 The emergence and spread of the novel coronavirus, or COVID-19, beginning in the first quarter of 2020 has impacted our business. During periods of increased incidences of COVID-19, non-essential care from a reduction in non-COVID-19 hospital admissions and lower overall healthcare system consumption decreased utilization. At the same time, COVID-19 treatment and testing costs increased utilization. The significant disruption in utilization during 2020 also impacted our ability to implement clinical initiatives to manage health care costs and chronic conditions of our members, and appropriately document their risk profiles, and, as such, significantly affected our 2021 revenue under the risk adjustment payment model for Medicare Advantage plans. Finally, changes in utilization patterns and actions taken in 2020 and 2021 as a result of the COVID-19 pandemic, including the suspension of certain financial recovery programs for a period of time and shifting the timing of claim payments and provider capitation surplus payments, impacted our claim reserve development and operating cash flows for 2020 and 2021. Health Care Reform The Patient Protection and Affordable Care Act and The Health Care and Education Reconciliation Act of 2010 (which we collectively refer to as the Health Care Reform Law) enacted significant reforms to various aspects of the U.S. health insurance industry. Certain of these reforms became effective January 1, 2014, including an annual insurance industry premium-based fee. The Continuing Resolution bill, H.R. 195, enacted on January 22, 2018, included a one year suspension in 2019 of the health insurance industry fee, but the fee resumed in calendar year 2020. The Further Consolidated Appropriations Act, 2020, enacted on December 20, 2019, permanently repealed the health insurance industry fee beginning in calendar year 2021. The annual premium-based fee on health insurers were not deductible for tax purposes. We estimated a liability for the health insurance industry fee and recorded it in full once qualifying insurance coverage was provided in the applicable calendar year in which the fee was payable with a corresponding deferred cost that was amortized ratably to expense over the same calendar year. We recorded the liability for the health insurance industry fee in trade accounts payable and accrued expenses and recorded the deferred cost in other current assets in our consolidated financial statements. We paid the health insurance industry fee in September or October of each year. We paid the federal government $1.18 billion for the annual health insurance industry fee attributed to calendar year 2020. On November 2, 2017, we filed suit against the United States of America in the United States Court of Federal Claims, on behalf of our health plans seeking recovery from the federal government of approximately $611 million in payments under the risk corridor premium stabilization program established under Health Care Reform, for years 2014, 2015 and 2016. On April 27, 2020, the U.S. Supreme Court ruled that the government is obligated to pay the losses under this risk corridor program, and that Congress did not impliedly repeal the obligation under its appropriations riders. In September 2020, we received a $609 million payment from the U.S Government pursuant to the judgement issued by the Court of Federal Claims on July 7, 2020. The $609 million payment received from the U.S Government and approximately $31 million in related fees and expenses are reflected in Premiums revenue and Operating costs, respectively, in our consolidated statements of income for the year ended December 31, 2020 and reported in the Corporate segment. Cash and Cash Equivalents Cash and cash equivalents include cash, time deposits, money market funds, commercial paper, other money market instruments, and certain U.S. Government securities with an original maturity of three months or less. Carrying value approximates fair value due to the short-term maturity of the investments. Investment Securities Investment securities, which consist of debt and equity securities, are stated at fair value. Our debt securities have been categorized as available for sale. Debt securities available for current operations are classified as current assets and debt securities available to fund our professional and other self-insurance liability requirements, as well as restricted statutory deposits and equity securities, are classified as long-term assets. For the purpose of determining realized gross gains and losses for debt securities sold, which are included as a component of investment income in the consolidated statements of income, the cost of investment securities sold is based upon specific identification. Unrealized holding gains and losses for debt securities, net of applicable deferred taxes, are included as a component of stockholders’ equity and comprehensive income until realized from a sale or an expected credit loss is recognized. For the purpose of determining gross gains and losses for equity securities, changes in fair value at the reporting date are included as a component of investment income in the consolidated statements of income. Prior to January 1, 2020, we applied the other-than-temporary impairment model for securities in an unrealized loss position which did not result in any material impairments for 2019. Beginning on January 1, 2020, we adopted the new current expected credit losses, or CECL, model which retained many similarities from the previous other-than-temporary impairment model except eliminating from consideration in the impairment analysis the length of time over which the fair value had been less than cost. Also, under the CECL model, expected losses on available for sale debt securities are recognized through an allowance for credit losses rather than as reductions in the amortized cost of the securities. For debt securities whose fair value is less than their amortized cost which we do not intend to sell or are not required to sell, we evaluate the expected cash flows to be received as compared to amortized cost and determine if an expected credit loss has occurred. In the event of an expected credit loss, only the amount of the impairment associated with the expected credit loss is recognized in income with the remainder, if any, of the loss recognized in other comprehensive income. To the extent we have the intent to sell the debt security or it is more likely than not we will be required to sell the debt security before recovery of our amortized cost basis, we recognize an impairment loss in income in an amount equal to the full difference between the amortized cost basis and the fair value. Potential expected credit loss impairment is considered using a variety of factors, including the extent to which the fair value has been less than cost; adverse conditions specifically related to the industry, geographic area or financial condition of the issuer or underlying collateral of a debt security; changes in the quality of the debt security's credit enhancement; payment structure of the debt security; changes in credit rating of the debt security by the rating agencies; failure of the issuer to make scheduled principal or interest payments on the debt security and changes in prepayment speeds. For debt securities, we take into account expectations of relevant market and economic data. For example, with respect to mortgage and asset-backed securities, such data includes underlying loan level data and structural features such as seniority and other forms of credit enhancements. We estimate the amount of the expected credit loss component of a debt security as the difference between the amortized cost and the present value of the expected cash flows of the security. The present value is determined using the best estimate of future cash flows discounted at the implicit interest rate at the date of purchase. The expected credit loss cannot exceed the full difference between the amortized cost basis and the fair value. Receivables and Revenue Recognition We generally establish one-year commercial membership contracts with employer groups, subject to cancellation by the employer group on 30-day written notice. Our Medicare contracts with CMS renew annually. Our military services contracts with the federal government and certain contracts with various state Medicaid programs generally are multi-year contracts subject to annual renewal provisions. Premiums Revenue We receive monthly premiums from the federal government and various states according to government specified payment rates and various contractual terms. We bill and collect premium from employer groups and members in our Medicare and other individual products monthly. Changes in premium revenues resulting from the periodic changes in risk-adjustment scores derived from medical diagnoses for our membership are estimated by projecting the ultimate annual premium and are recognized ratably during the year, with adjustments each period to reflect changes in the ultimate premium. Receivables or payables are classified as current or long-term in our consolidated balance sheet based on the timing of the expected settlement. Premiums revenue is estimated by multiplying the membership covered under the various contracts by the contractual rates. Premiums revenue is recognized as income in the period members are entitled to receive services, and is net of estimated uncollectible amounts, retroactive membership adjustments, and adjustments to recognize rebates under the minimum benefit ratios required under the Health Care Reform Law. We estimate policyholder rebates by projecting calendar year minimum benefit ratios for the small group and large group markets, as defined by the Health Care Reform Law using a methodology prescribed by Health and Human Services, or HHS, separately by state and legal entity. Medicare Advantage and Medicaid products are also subject to minimum benefit ratio requirements. Estimated calendar year rebates recognized ratably during the year are revised each period to reflect current experience. Retroactive membership adjustments result from enrollment changes not yet processed, or not yet reported by an employer group or the government. We routinely monitor the collectability of specific accounts, the aging of receivables, historical retroactivity trends, estimated rebates, as well as prevailing and anticipated economic conditions, and reflect any required adjustments in current operations. Premiums received prior to the service period are recorded as unearned revenues. Medicare Part D We cover prescription drug benefits in accordance with Medicare Part D under multiple contracts with CMS. The payments we receive monthly from CMS and members, which are determined from our annual bid, represent amounts for providing prescription drug insurance coverage. We recognize premiums revenue for providing this insurance coverage ratably over the term of our annual contract. Our CMS payment is subject to risk sharing through the Medicare Part D risk corridor provisions. In addition, receipts for reinsurance and low-income cost subsidies as well as receipts for certain discounts on brand name prescription drugs in the coverage gap represent payments for prescription drug costs for which we are not at risk. The risk corridor provisions compare costs targeted in our bids to actual prescription drug costs, limited to actual costs that would have been incurred under the standard coverage as defined by CMS. Variances exceeding certain thresholds may result in CMS making additional payments to us or require us to refund to CMS a portion of the premiums we received. As risk corridor provisions are considered in our overall annual bid process, we estimate and recognize an adjustment to premiums revenue related to these provisions based upon pharmacy claims experience. We record a receivable or payable at the contract level and classify the amount as current or long-term in our consolidated balance sheets based on the timing of expected settlement. Reinsurance and low-income cost subsidies represent funding from CMS in connection with the Medicare Part D program for which we assume no risk. Reinsurance subsidies represent funding from CMS for its portion of prescription drug costs which exceed the member’s out-of-pocket threshold, or the catastrophic coverage level. Low-income cost subsidies represent funding from CMS for all or a portion of the deductible, the coinsurance and co-payment amounts above the out-of-pocket threshold for low-income beneficiaries. Monthly prospective payments from CMS for reinsurance and low-income cost subsidies are based on assumptions submitted with our annual bid. A reconciliation and related settlement of CMS’s prospective subsidies against actual prescription drug costs we paid is made after the end of the year. The Health Care Reform Law mandates consumer discounts of 50% on brand name prescription drugs for Part D plan participants in the coverage gap. These discounts are funded by CMS and pharmaceutical manufacturers while we administer the application of these funds. We account for these subsidies and discounts as a deposit in our consolidated balance sheets and as a financing activity under receipts (withdrawals) from contract deposits in our consolidated statements of cash flows. 2021 2020 2019 (in millions) Part D subsidy/discount payments $ (14,889) $ (13,348) $ (11,762) Part D subsidy/discount reimbursements 14,628 12,410 11,202 Net payments $ (261) $ (938) $ (560) We do not recognize premiums revenue or benefit expenses for these subsidies or discounts. Receipt and payment activity is accumulated at the contract level and recorded in our consolidated balance sheets in other current assets or trade accounts payable and accrued expenses depending on the contract balance at the end of the reporting period. Settlement of the reinsurance and low-income cost subsidies as well as the risk corridor payment is based on a reconciliation made approximately 9 months after the close of each calendar year. Settlement with CMS for brand name prescription drug discounts is based on a reconciliation made approximately 14 to 18 months after the close of each calendar year. We continue to revise our estimates with respect to the risk corridor provisions based on subsequent period pharmacy claims data. See Note 7 for detail regarding amounts recorded to our consolidated balance sheets related to the risk corridor settlement and subsidies from CMS with respect to the Medicare Part D program. Services Revenue Patient services revenue Patient services include services related to pharmacy solutions, provider services, and home solutions services, such as home health and other services and capabilities to promote wellness and advance population health. Patient services revenues are reported in the amount reflecting the ultimate consideration we expect to receive, primarily from government programs (Medicare and Medicaid), net of contractual allowances, discounts, or other implicit price concessions. We estimate the transaction price utilizing contractual rates, historical experience and current conditions. Patient services revenues are recognized as performance obligations are satisfied, which is in the period services are rendered. For the year ended December 31, 2021, revenue recognized from performance obligations related to prior periods (for example, due to changes in transaction price), was not material. Further, revenue expected to be recognized in any future year related to remaining performance obligations was not material. Administrative services fees Administrative services fees cover the processing of claims, offering access to our provider networks and clinical programs, and responding to customer service inquiries from members of self-funded groups. Revenues from providing administration services, also known as administrative services only, or ASO, are recognized in the period services are performed and are net of estimated uncollectible amounts. ASO fees are estimated by multiplying the membership covered under the various contracts by the contractual rates. Under ASO contracts, self-funded employers retain the risk of financing substantially all of the cost of health benefits. However, many ASO customers purchase stop loss insurance coverage from us to cover catastrophic claims or to limit aggregate annual costs. Accordingly, we have recorded premiums revenue and benefits expense related to these stop loss insurance contracts. We routinely monitor the collectability of specific accounts, the aging of receivables, as well as prevailing and anticipated economic conditions, and reflect any required adjustments in current operations. ASO fees received prior to the service period are recorded as unearned revenues. Under our TRICARE contracts with the Department of Defense (DoD) we provide administrative services, including offering access to our provider networks and clinical programs, claim processing, customer service, enrollment, and other services, while the federal government retains all of the risk of the cost of health benefits. We account for revenues under our contracts net of estimated health care costs similar to an administrative services fee only agreement. Our contracts include fixed administrative services fees and incentive fees and penalties. Administrative services fees are recognized as services are performed. Our TRICARE members are served by both in-network and out-of-network providers in accordance with our contracts. We pay health care costs related to these services to the providers and are subsequently reimbursed by the DoD for such payments. We account for the payments of the federal government’s claims and the related reimbursements under deposit accounting in our consolidated balance sheets and as a financing activity under receipts (withdrawals) from contract deposits in our consolidated statements of cash flows. 2021 2020 2019 (in millions) Health care cost payments $ (6,943) $ (6,253) $ (6,475) Health care cost reimbursements 6,898 6,252 6,412 Net payments $ (45) $ (1) $ (63) Receivables Receivables, including premium receivables, patient services revenue receivables, and ASO fee receivables, are shown net of allowances for estimated uncollectible accounts, retroactive membership adjustments, and contractual allowances. At December 31, 2021 and 2020, accounts receivable related to services were $475 million and $161 million, respectively. For the years ended December 31, 2021, 2020 and 2019, we had no material bad-debt expense and there were no material contract assets, contract liabilities or deferred contract costs recorded on the consolidated balance sheet at December 31, 2021 and 2020. Other Current Assets Other current assets include amounts associated with Medicare Part D as discussed above and in Note 7, rebates due from pharmaceutical manufacturers and other amounts due within one year. We accrue pharmaceutical rebates as they are earned based on contractual terms and usage of the product. The balance of pharmaceutical rebates receivable was $2.0 billion and $1.4 billion at December 31, 2021 and 2020, respectively. Policy Acquisition Costs Policy acquisition costs are those costs that relate directly to the successful acquisition of new and renewal insurance policies. Such costs include commissions, costs of policy issuance and underwriting, and other costs we incur to acquire new business or renew existing business. We expense policy acquisition costs related to our employer-group prepaid health services policies as incurred. These short-duration employer-group prepaid health services policies typically have a 1-year term and may be canceled upon 30 days notice by the employer group. Long-Lived Assets Property and equipment is recorded at cost. Gains and losses on sales or disposals of property and equipment are included in operating costs. Certain costs related to the development or purchase of internal-use software are capitalized. Depreciation is computed using the straight-line method over estimated useful lives ranging from 3 to 10 years for equipment, 3 to 5 years for computer software, and 10 to 20 years for buildings. Improvements to leased facilities are depreciated over the shorter of the remaining lease term or the anticipated life of the improvement. We periodically review long-lived assets, including property and equipment and definite-lived intangible assets, for impairment whenever adverse events or changes in circumstances indicate the carrying value of the asset may not be recoverable. Losses are recognized for a long-lived asset to be held and used in our operations when the undiscounted future cash flows expected to result from the use of the asset are less than its carrying value. We recognize an impairment loss based on the excess of the carrying value over the fair value of the asset. A long-lived asset held for sale is reported at the lower of the carrying amount or fair value less costs to sell. Depreciation expense is not recognized on assets held for sale. Losses are recognized for a long-lived asset to be abandoned when the asset ceases to be used. In addition, we periodically review the estimated lives of all long-lived assets for reasonableness. Equity Method Investments We use the equity method of accounting for equity investments in companies where we are able to exercise significant influence, but not control, over operating and financial policies of the investee. Judgment regarding the level of influence over each equity method investment includes considering key factors such as our ownership interest, representation on the board of directors, organizational structure, participation in policy-making decisions and material intra-entity transactions. Generally, under the equity method, original investments in these entities are recorded at cost and subsequently adjusted by our share of equity in income or losses after the date of acquisition as well as capital contributions to and distributions from these companies. Our proportionate share of the net income or loss of these companies is included in consolidated net income. Investment amounts in excess of our share of an investee’s net assets are amortized over the life of the related asset creating the excess. Excess goodwill is not amortized. We evaluate equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment might not be recoverable. Factors considered by us when reviewing an equity method investment for impairment include the length of time (duration) and the extent (severity) to which the fair value of the equity method investment has been less than carrying value, the investee’s financial condition and near-term prospects and the intent and ability to hold the investment for a period of time sufficient to allow for anticipated recovery. An impairment that is other-than-temporary is recognized in the period identified. Additional detail regarding our equity method investments is included in Note 4. Goodwill and Intangible Assets Goodwill represents the unamortized excess of cost over the fair value of the net tangible and other intangible assets acquired. We are required to test at least annually for impairment at a level of reporting referred to as the reporting unit, and more frequently if adverse events or changes in circumstances indicate that the asset may be impaired. A reporting unit either is our operating segments or one level below the operating segments, referred to as a component, which comprise our reportable segments. A component is considered a reporting unit if the component constitutes a business for which discrete financial information is available that is regularly reviewed by management. We aggregate the components of an operating segment into one reporting unit if they have similar economic characteristics. Goodwill is assigned to the reporting units that are expected to benefit from the specific synergies of the business combination. We perform a quantitative assessment to review goodwill for impairment to determine both the existence and amount of goodwill impairment, if any. Impairment tests are performed, at a minimum, in the fourth quarter of each year supported by our long-range business plan and annual planning process. We rely on an evaluation of future discounted cash flows to determine fair value of our reporting units. The fair value of our reporting units with significant goodwill exceeded carrying amounts by a substantial margin. However, unfavorable changes in key assumptions or combinations of assumptions including a significant increase in the discount rate, decrease in the long-term growth rate or substantial reduction in our underlying cash flow assumptions, including revenue growth rates, medical and operating cost trends, and projected operating income could have a significant negative impact on the estimated fair value of our home solutions and provider reporting units, which accounted for $6.6 billion and $0.9 billion of goodwill, respectively. Impairment tests completed for 2021, 2020, and 2019 did not result in an impairment loss. Indefinite-lived intangible assets relate to Certificate of Needs (CON) and Medicare licenses acquired as part of our acquisition of Kindred at Home, or KAH, and are included within other long-term assets in the consolidated balance sheet at December 31, 2021. See Note 3 for further information. We are required to annually compare the fair values of other indefinite-lived intangible assets to their carrying amounts. If the carrying amount of an indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized. Fair values of indefinite-lived intangible assets are determined based on the income approach. Impairment tests completed for 2021 did not result in an impairment loss. Definite-lived intangible assets primarily relate to acquired customer contracts/relationships and are included with other long-term assets in the consolidated balance sheets. Definite-lived intangible assets are amortized over the useful life generally using the straight-line method. We review definite-lived intangible assets for impairment under our long-lived asset policy. Benefits Payable and Benefits Expense Recognition Benefits expense includes claim payments, capitation payments, pharmacy costs net of rebates, allocations of certain centralized expenses and various other costs incurred to provide health insurance coverage to members, as well as estimates of future payments to hospitals and others for medical care and other supplemental benefits provided on or prior to the balance sheet date. Capitation payments represent monthly contractual fees disbursed to primary care and other providers who are responsible for providing medical care to members. Pharmacy costs represent payments for members’ prescription drug benefits, net of rebates from drug manufacturers. Receivables for such pharmacy rebates are included in other current assets in our consolidated balance sheets. Other supplemental benefits include dental, vision, and other supplemental health products. We estimate the costs of our benefits expense payments using actuarial methods and assumptions based upon claim payment patterns, medical cost inflation, historical developments such as claim inventory levels and claim receipt patterns, and other relevant factors, and record benefit reserves for future payments. We continually review estimates of future payments relating to claims costs for services incurred in the current and prior periods and make necessary adjustments to our reserves. Benefits expense is recognized in the period in which services are provided and includes an estimate of the cost of services which have been incurred but not yet reported, or IBNR. Our reserving practice is to consistently recognize the actuarial best point estimate within a level of confidence required by actuarial standards. Actuarial standards of practice generally require a level of confidence such that the liabilities established for IBNR have a greater probability of being adequate versus being insufficient, or such that the liabilities established for IBNR are sufficient to cover obligations under an assumption of moderately adverse conditions. Adverse conditions are situations in which the actual claims are expected to be higher than the otherwise estimated value of such claims at the time of the estimate. Therefore, in many situations, the claim amounts ultimately settled will be less than the estimate that satisfies the actuarial standards of practice. We develop our estimate for IBNR using actuarial methodologies and assumptions, primarily based upon historical claim experience. Depending on the period for which incurred claims are estimated, we apply a different method in determining our estimate. For periods prior to the most recent two months, a completion factor method uses historical paid claims patterns to estimate the percentage of claims incurred during a given period that have historically been adjudicated as of the reporting period. Changes in claim inventory levels and known changes in claim payment processes are taken into account in these estimates. For the most recent two months, the incurred claims are estimated primarily from a trend analysis based upon per member per month claims trends developed from our historical experience in the preceding months, adjusted for known changes in estimates of hospital admissions, recent hospital and drug utilization data, provider contracting changes, changes in benefit levels, changes in member cost sharing, changes in medical management processes, product mix, and workday seasonality. The completion factor method is used for the months of incurred claims prior to the most recent two months because the historical percentage of claims processed for those months is at a level sufficient to produce a consistently reliable result. Conversely, for the most recent two months of incurred claims, the volume of claims processed historically is not at a level sufficient to produce a reliable result, which therefore requires us to examine historical trend patterns as the primary method of evaluation. Changes in claim processes, including recoveries of overpayments, receipt cycle times, claim inventory levels, outsourcing, system conversions, and processing disruptions due to weather or other events affect views regarding the reasonable choice of completion factors. Claim payments to providers for services rendered are often net of overpayment recoveries for claims paid previously, as contractually allowed. Claim overpayment recoveries can result from many different factors, including retroactive enrollment activity, audits of provider billings, and/ |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITIONS | ACQUISITIONS On August 17, 2021, we acquired the remaining 60% interest in Kindred at Home, the nation’s largest home health and hospice provider, from TPG Capital and Welsh, Carson, Anderson & Stowe, two private equity funds, for an enterprise value of $8.2 billion, which includes our equity value of $2.4 billion associated with our 40% minority ownership interest. The remeasurement to fair value of our previously held 40% equity method investment with a carrying value of approximately $1.3 billion, resulted in a $1.1 billion gain recognized in "Other (income) expense, net". We paid the approximate $5.8 billion transaction price (net of our existing equity stake) through a combination of debt financing, the assumption of existing KAH indebtedness and parent company cash. The preliminary fair values of KAH’s assets acquired and liabilities assumed at the date of the acquisition are summarized as follows: Kindred at Home (in millions) Cash and cash equivalents $ 278 Receivables 381 Other current assets 61 Property and equipment 74 Goodwill 5,771 Other intangible assets 2,312 Other long-term assets 172 Total assets acquired $ 9,049 Current liabilities $ 410 Long term debt 2,078 Other long-term liabilities 369 Total liabilities assumed $ 2,857 Noncontrolling interests 22 Net assets acquired $ 6,170 The other intangible assets primarily consist of Certificate of Needs (CON) and Medicare licenses which have indefinite lives. Amortizing trade names included in other intangibles assets of approximately $18 million have an estimated weighted average useful life of 10 years. The goodwill, allocated to our Healthcare Services segment, primarily relates to the future economic benefit arising from the assets acquired and is consistent with our integrated care delivery strategy. Approximately $132 million of the goodwill is deductible for tax purposes. The purchase price allocation is preliminary, subject to receipt and validation of certain tax related analyses. The results of operations and financial condition of KAH have been included in our consolidated statements of income and consolidated balance sheets from the acquisition date. In connection with the acquisition, we recognized approximately $45 million of acquisition-related costs, primarily compensation costs as well as banker and other professional fees, in operating costs in our consolidated statements of income. In the first quarter of 2020, we acquired privately held Enclara Healthcare, or Enclara, one of the nation’s largest hospice pharmacy and benefit management providers for cash consideration of approximately $709 million, net of cash received. This resulted in a purchase price allocation to goodwill of $517 million, other intangible assets of $240 million, and net tangible liabilities assumed of $13 million. The goodwill was assigned to the Healthcare Services segment. The other intangible assets, which primarily consist of customer contracts, have an estimated weighted average useful life of 11 years. Enclara's goodwill is not deductible for tax purposes. During 2021 and 2020, we acquired other health and wellness related businesses which other than the impacts to goodwill, individually or in the aggregate, have not had a material impact on our results of operations, financial |
EQUITY METHOD INVESTMENT
EQUITY METHOD INVESTMENT | 12 Months Ended |
Dec. 31, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
EQUITY METHOD INVESTMENT | EQUITY METHOD INVESTMENT Prior to our acquisition of KAH in August 2021, we accounted for our 40% investment in KAH using the equity method of accounting. This investment was reflected in "Equity method investments" in our December 31, 2020 consolidated balance sheet, with our share of income or loss reported as Equity in net earnings in our consolidated statements of income. The summarized balance sheet at December 31, 2020 and statements of income at December 31, 2020 and 2019 of KAH were as follows: Balance sheet December 31, 2020 (in millions) Current assets $ 844 Non-current assets 4,858 Current liabilities 556 Non-current liabilities 2,445 Shareholders' equity 2,700 Statements of income For the year ended December 31, 2020 For the year ended December 31, 2019 (in millions) Revenues $ 2,972 $ 3,100 Expenses 2,552 2,835 Net income 207 54 Other insignificant equity method investments In the first quarter of 2020, our Primary Care Organization entered into a strategic partnership with Welsh, Carson, Anderson & Stowe, or WCAS, to accelerate the expansion of our primary care model. As of December 31, 2021, there were 31 primary care clinics operating under the partnership and we intend to open an additional 36 in future periods under the existing arrangement. In addition, the agreement includes a series of put and call options through which WCAS may require us to purchase their interest in the entity and, through which we may acquire WCAS’s interest over the next 4 to 9 years. We have several individually immaterial equity method investments, including our PIPC strategic partnership with WCAS as described above, included within Equity method investments in our consolidated balance sheets as of December 31, 2021, with our share of income or loss reported as Equity in net earnings in our consolidated statements of income for the years ended December 31, 2021 and 2020. |
INVESTMENT SECURITIES
INVESTMENT SECURITIES | 12 Months Ended |
Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENT SECURITIES | INVESTMENT SECURITIES Investment securities classified as current and long-term were as follows at December 31, 2021 and 2020, respectively: Amortized Gross Gross Fair (in millions) December 31, 2021 U.S. Treasury and other U.S. government U.S. Treasury and agency obligations $ 611 $ 1 $ (10) $ 602 Mortgage-backed securities 3,265 33 (69) 3,229 Tax-exempt municipal securities 810 33 (2) 841 Mortgage-backed securities: Residential 373 — (6) 367 Commercial 1,394 27 (11) 1,410 Asset-backed securities 1,346 6 (4) 1,348 Corporate debt securities 5,641 118 (59) 5,700 Total debt securities $ 13,440 $ 218 $ (161) 13,497 Common stock 475 Total investment securities $ 13,972 December 31, 2020 U.S. Treasury and other U.S. government U.S. Treasury and agency obligations $ 616 $ 1 $ (1) $ 616 Mortgage-backed securities 3,115 140 (1) 3,254 Tax-exempt municipal securities 1,393 54 — 1,447 Mortgage-backed securities: Residential 17 — — 17 Commercial 1,260 59 (1) 1,318 Asset-backed securities 1,364 10 (2) 1,372 Corporate debt securities 4,672 256 (1) 4,927 Total debt securities $ 12,437 $ 520 $ (6) 12,951 Common stock 815 Total investment securities $ 13,766 Gross unrealized losses and fair values aggregated by investment category and length of time that individual debt securities have been in a continuous unrealized loss position were as follows at December 31, 2021 and 2020, respectively: Less than 12 months 12 months or more Total Fair Gross Fair Gross Fair Gross (in millions) December 31, 2021 U.S. Treasury and other U.S. government U.S. Treasury and agency obligations $ 201 $ (3) $ 355 $ (7) $ 556 $ (10) Mortgage-backed securities 2,082 (49) 556 (20) 2,638 (69) Tax-exempt municipal securities 68 (1) 34 (1) 102 (2) Mortgage-backed securities: Residential 358 (6) 8 — 366 (6) Commercial 295 (4) 400 (7) 695 (11) Asset-backed securities 530 (3) 425 (1) 955 (4) Corporate debt securities 1,456 (28) 769 (31) 2,225 (59) Total debt securities $ 4,990 $ (94) $ 2,547 $ (67) $ 7,537 $ (161) December 31, 2020 U.S. Treasury and other U.S. government U.S. Treasury and agency obligations $ 225 $ (1) $ — $ — $ 225 $ (1) Mortgage-backed securities 199 (1) — — 199 (1) Tax-exempt municipal securities 16 — 19 — 35 — Mortgage-backed securities: Residential 17 — — — 17 — Commercial 193 (1) 43 — 236 (1) Asset-backed securities 65 — 498 (2) 563 (2) Corporate debt securities 342 (1) 16 — 358 (1) Total debt securities $ 1,057 $ (4) $ 576 $ (2) $ 1,633 $ (6) Approximately 95% of our debt securities were investment-grade quality, with a weighted average credit rating of AA- by S&P at December 31, 2021. Most of the debt securities that were below investment-grade were rated BB, the higher end of the below investment-grade rating scale. Tax-exempt municipal securities were diversified among general obligation bonds of states and local municipalities in the United States as well as special revenue bonds issued by municipalities to finance specific public works projects such as utilities, water and sewer, transportation, or education. Our general obligation bonds are diversified across the United States with no individual state exceeding 1% of our total debt securities. Our investment policy limits investments in a single issuer and requires diversification among various asset types. Our unrealized loss from all debt securities was generated from approximately 720 positions out of a total of approximately 1,730 positions at December 31, 2021. All issuers of debt securities we own that were trading at an unrealized loss at December 31, 2021 remain current on all contractual payments. After taking into account these and other factors previously described, we believe these unrealized losses primarily were caused by an increase in market interest rates in the current markets since the time the debt securities were purchased. At December 31, 2021, we did not intend to sell any debt securities with an unrealized loss position in accumulated other comprehensive income, and it is not likely that we will be required to sell these debt securities before recovery of their amortized cost basis. Additionally, we did not record any material credit allowances for debt securities that were in an unrealized loss position at December 31, 2021 or 2020. The detail of realized gains (losses) related to investment securities and included within investment income was as follows for the years ended December 31, 2021, 2020, and 2019: 2021 2020 2019 (in millions) Gross gains on investment securities $ 219 $ 110 $ 129 Gross losses on investment securities (8) (18) (67) Gross gains on equity securities 23 746 — Gross losses on equity securities (364) — — Net recognized (losses) gains on investment securities $ (130) $ 838 $ 62 The gains and losses related to equity securities for the years ended December 31, 2021 and 2020 was as follows: 2021 2020 (in millions) Net (losses) gains recognized on equity securities during the period $ (341) $ 746 Less: Net losses recognized on equity securities sold during the period (13) — Unrealized (losses) gains recognized on equity securities still held at the end of the period $ (328) $ 746 All purchases of and proceeds from investment securities for the years ended December 31, 2020 and 2019 relate to debt securities. There were no material other-than-temporary impairments in 2019. The contractual maturities of debt securities available for sale at December 31, 2021, regardless of their balance sheet classification, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Fair (in millions) Due within one year $ 459 $ 461 Due after one year through five years 2,200 2,251 Due after five years through ten years 3,043 3,057 Due after ten years 1,360 1,374 Mortgage and asset-backed securities 6,378 6,354 Total debt securities $ 13,440 $ 13,497 |
FAIR VALUE
FAIR VALUE | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE | FAIR VALUE Financial Assets The following table summarizes our fair value measurements at December 31, 2021 and 2020, respectively, for financial assets measured at fair value on a recurring basis: Fair Value Measurements Using Fair Value Quoted Prices Other Unobservable (in millions) December 31, 2021 Cash equivalents $ 3,322 $ 3,322 $ — $ — Debt securities: U.S. Treasury and other U.S. government corporations and agencies: U.S. Treasury and agency obligations 602 — 602 — Mortgage-backed securities 3,229 — 3,229 — Tax-exempt municipal securities 841 — 841 — Mortgage-backed securities: Residential 367 — 367 — Commercial 1,410 — 1,410 — Asset-backed securities 1,348 — 1,348 — Corporate debt securities 5,700 — 5,632 68 Total debt securities 13,497 — 13,429 68 Common stock 475 475 — — Total invested assets $ 17,294 $ 3,797 $ 13,429 $ 68 December 31, 2020 Cash equivalents $ 4,548 $ 4,548 $ — $ — Debt securities: U.S. Treasury and other U.S. government corporations and agencies: U.S. Treasury and agency obligations 616 — 616 — Mortgage-backed securities 3,254 — 3,254 — Tax-exempt municipal securities 1,447 — 1,447 — Mortgage-backed securities: Residential 17 — 17 — Commercial 1,318 — 1,318 — Asset-backed securities 1,372 — 1,372 — Corporate debt securities 4,927 — 4,927 — Total debt securities 12,951 — 12,951 — Common stock 815 815 — — Total invested assets $ 18,314 $ 5,363 $ 12,951 $ — Our Level 3 assets had a fair value of $68 million at December 31, 2021, or 0.4% of our total invested assets. During the year ended December 31, 2021, the changes in the fair value of the assets measured using significant unobservable inputs (Level 3) were comprised of the following: For the year ended December 31, 2021 Private (in millions) Beginning balance at January 1 $ — Total gains or losses: Realized in earnings — Unrealized in other comprehensive income (1) Purchases 69 Sales — Settlements — Balance at December 31 $ 68 Financial Liabilities Our debt is recorded at carrying value in our consolidated balance sheets. The carrying value of our senior notes debt outstanding, net of unamortized debt issuance costs, was $9.0 billion at December 31, 2021 and $6.1 billion at December 31, 2020. The fair value of our senior note debt was $10.0 billion at December 31, 2021 and $7.4 billion at December 31, 2020. The fair value of our senior note debt is determined based on Level 2 inputs, including quoted market prices for the same or similar debt, or if no quoted market prices are available, on the current prices estimated to be available to us for debt with similar terms and remaining maturities. Carrying value approximates fair value for our term loans and commercial paper borrowings. The term loan and commercial paper borrowings were $3.5 billion at December 31, 2021. Our commercial paper borrowings were $600 million at December 31, 2020. Put and Call Options Measured at Fair Value Our put and call options associated with our equity method investments are measured at fair value each period using a Monte Carlo simulation. Effective April 27, 2021, with the signing of the definitive agreement to acquire the remaining 60% interest of KAH, the respective put and call options were terminated. As such, the $63 million put and $440 million call fair values as of the first quarter of 2021 were reduced to zero, resulting in $377 million in "Other (income) expense, net" in our consolidated statements of income for the year ended December 31, 2021. The put and call options were measured at fair value using a Monte Carlo simulation which resulted in fair values of $45 million and $503 million, respectively, at December 31, 2020. The put option was included within other long-term liabilities and the call option included within other long-term assets at December 31, 2020. The change in fair value of the put and call options is reflected as "Other (income) expense, net" in our consolidated statements of income. The significant unobservable inputs utilized in these Level 3 fair value measurements (and selected values) include the enterprise value of KAH, annualized volatility and secured credit rate. Enterprise value was derived from a discounted cash flow model, which utilized significant unobservable inputs for long-term net operating profit after tax margin, or NOPAT, to measure underlying cash flows, weighted average cost of capital and long term growth rate. The table below presents the assumptions used for December 31, 2020. December 31, 2020 Annualized volatility 29.9 % Secured credit rate 0.4 % NOPAT 12.0 % Weighted average cost of capital 9.5 % Long term growth rate 3.0 % The put and call options fair values associated with our Primary Care Organization strategic partnership with WCAS, which are exercisable at a fixed revenue exit multiple and provide a minimum return on WCAS' investment if exercised, are measured at fair value each reporting period using a Monte Carlo simulation. The put and call options fair values, derived from the Monte Carlo simulation, were $202 million and $13 million, respectively, at December 31, 2021. The put and call options fair values, derived from the Monte Carlo simulation, were $64 million and $15 million, respectively, at December 31, 2020. The significant unobservable inputs utilized in these Level 3 fair value measurements (and selected values) include the enterprise value, annualized volatility and credit spread. Enterprise value was derived from a discounted cash flow model, which utilized significant unobservable inputs for long-term revenue, to measure underlying cash flows, weighted average cost of capital and long term growth rate. The table below presents the assumptions used for December 31, 2021. December 31, 2021 Annualized volatility 22.4 % Credit spread 0.9 % Revenue exit multiple 1.5x - 2.5x Weighted average cost of capital 12.5 % Long term growth rate 3.0 % Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Certain assets and liabilities are measured at fair value on a non-recurring basis subject to fair value adjustment only in certain circumstances. As disclosed in Note 3, “Acquisitions”, we completed our acquisition of KAH during the third quarter of 2021. The net assets acquired and resulting goodwill and other intangible assets were recorded at fair value primarily using Level 3 inputs. The net tangible assets including receivables and accrued liabilities were recorded at their carrying value which approximated their fair value due to their short term nature. The fair value of goodwill and other intangible assets were internally estimated based on the income approach. The income approach estimates fair value based on the present value of cash flow that the assets could be expected to generate in the future. We developed internal estimates for expected cash flows in the present value calculation using inputs and significant assumptions that include historical revenues and earnings, long-term growth rate, discount rate, contributory asset charges and future tax rates, among others. The excess purchase price over the fair value of assets and liabilities acquired is recorded as goodwill. Other than the assets acquired and liabilities assumed in the KAH and other acquisitions in Note 3, there were no other material assets or liabilities measured at fair value on a recurring or nonrecurring basis during 2021, 2020, or 2019. |
MEDICARE PART D
MEDICARE PART D | 12 Months Ended |
Dec. 31, 2021 | |
Insurance [Abstract] | |
MEDICARE PART D | MEDICARE PART D As discussed in Note 2, we cover prescription drug benefits in accordance with Medicare Part D under multiple contracts with CMS. The accompanying consolidated balance sheets include the following amounts associated with Medicare Part D as of December 31, 2021 and 2020. CMS subsidies/discounts in the table below include the reinsurance and low-income cost subsidies funded by CMS for which we assume no risk as well as brand name prescription drug discounts for Part D plan participants in the coverage gap funded by CMS and pharmaceutical manufacturers. 2021 2020 Risk CMS Risk CMS (in millions) Other current assets $ 363 $ 1,894 $ 216 $ 1,420 Trade accounts payable and accrued expenses (68) (466) (39) (253) Net current asset 295 1,428 177 1,167 Other long-term assets 5 — 8 — Other long-term liabilities (194) — (90) — Net long-term liability (189) — (82) — Total net asset $ 106 $ 1,428 $ 95 $ 1,167 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | PROPERTY AND EQUIPMENT, NET Property and equipment was comprised of the following at December 31, 2021 and 2020. 2021 2020 (in millions) Land $ 17 $ 19 Buildings and leasehold improvements 1,126 952 Equipment 1,148 1,009 Computer software 3,656 3,514 5,947 5,494 Accumulated depreciation (2,874) (3,123) Property and equipment, net $ 3,073 $ 2,371 Depreciation expense was $640 million in 2021, $528 million in 2020, and $505 million in 2019, including amortization expense for capitalized internally developed and purchased software of $443 million in 2021, $351 million in 2020, and $343 million in 2019. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS Changes in the carrying amount of goodwill for our reportable segments for the years ended December 31, 2021 and 2020 were as follows: Retail Group and Specialty Healthcare Services Total (in millions) Balance at January 1, 2020 $ 1,535 $ 261 $ 2,132 $ 3,928 Acquisitions — — 519 519 Balance at December 31, 2020 1,535 261 2,651 4,447 Acquisitions 398 — 6,247 6,645 Balance at December 31, 2021 $ 1,933 $ 261 $ 8,898 $ 11,092 The following table presents details of our other intangible assets included in other long-term assets in the accompanying consolidated balance sheets at December 31, 2021 and 2020. Weighted 2021 2020 Cost Accumulated Net Cost Accumulated Net (in millions) Other intangible assets: Certificates of need Indefinite $ 1,771 $ — $ 1,771 $ — $ — $ — Medicare licenses Indefinite 522 — 522 — — — Customer contracts/relationships 9.4 years 883 620 263 849 572 277 Trade names and technology 7.0 years 160 97 63 122 89 33 Provider contracts 11.6 years 72 57 15 69 50 19 Noncompetes and other 6.8 years 35 30 5 29 29 — Total other intangible assets 9.1 years $ 3,443 $ 804 $ 2,639 $ 1,069 $ 740 $ 329 Amortization expense for other intangible assets was approximately $65 million in 2021, $88 million in 2020, and $70 million in 2019. The following table presents our estimate of amortization expense for each of the five next succeeding fiscal years: (in millions) 2022 $ 68 2023 53 2024 45 2025 43 2026 31 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
LEASES | LEASESWe determine if a contract contains a lease by evaluating the nature and substance of the agreement. We lease facilities, computer hardware, and other furniture and equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. For new lease agreements, we combine lease and nonlease components for all of our asset classes. When portions of the lease payments are not fixed or depend on an index or rate, we consider those payments to be variable in nature. Our variable lease payments include, but are not limited to, common area maintenance, taxes and insurance which are not dependent upon an index or rate. Variable lease payments are recorded in the period in which the obligation for the payment is incurred. Most leases include options to renew, with renewal terms that can extend the lease term. The exercise of lease renewal options is at our sole discretion. Certain leases also include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Right-of-use assets included within other long-term assets trade accounts payable and accrued expenses other long-term liabilities For the years ended December 31, 2021 and December 31, 2020, total fixed operating lease costs, excluding short-term lease costs, were $159 million and $141 million, respectively, and are included within operating costs in our consolidated statements of income. Short-term lease costs were not material for the years ended December 31, 2021 and December 31, 2020. In addition, for the years ended December 31, 2021 and December 31, 2020, total variable operating lease costs were $94 million and $92 million, respectively, and are included within operating costs in our consolidated statements of income. We sublease facilities or partial facilities to third party tenants for space not used in our operations. For the years ended December 31, 2021 and December 31, 2020, sublease rental income was $43 million and $36 million, respectively, and is included within operating costs in our consolidated statements of income. The weighted average remaining lease term is 5.4 years and 5.2 years with a weighted average discount rate of 3.2% and 3.7% at December 31, 2021 and December 31, 2020, respectively. For the year-ended December 31, 2021 and December 31, 2020, cash paid for amounts included in the measurement of lease liabilities included within our operating cash flows was $165 million and $146 million, respectively. Maturity of Lease Liabilities December 31, 2021 For the years ended December 31, (in millions) 2022 $ 210 2023 170 2024 133 2025 105 2026 58 After 2026 129 Total lease payments 805 Less: Interest 74 Present value of lease liabilities $ 731 As most of our leases do not provide an implicit rate, we use our incremental borrowing rate, as adjusted for collateralized borrowings, based on the information available at date of adoption or commencement date in determining the present value of lease payments. |
BENEFITS PAYABLE
BENEFITS PAYABLE | 12 Months Ended |
Dec. 31, 2021 | |
Insurance [Abstract] | |
BENEFITS PAYABLE | BENEFITS PAYABLE On a consolidated basis, activity in benefits payable was as follows for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 (in millions) Balances at January 1 $ 8,143 $ 6,004 $ 4,862 Less: Reinsurance recoverables — (68) (95) Balances at January 1, net 8,143 5,936 4,767 Acquisitions 42 — — Incurred related to: Current year 70,024 61,941 54,193 Prior years (825) (313) (336) Total incurred 69,199 61,628 53,857 Paid related to: Current year (62,149) (54,003) (48,421) Prior years (6,946) (5,418) (4,267) Total paid (69,095) (59,421) (52,688) Reinsurance recoverable — — 68 Balances at December 31 $ 8,289 $ 8,143 $ 6,004 Amounts incurred related to prior years vary from previously estimated liabilities as the claims ultimately are settled. Negative amounts reported for incurred related to prior years result from claims being ultimately settled for amounts less than originally estimated (favorable development). As previously discussed, our reserving practice is to consistently recognize the actuarial best estimate of our ultimate liability for claims. Actuarial standards require the use of assumptions based on moderately adverse experience, which generally results in favorable reserve development, or reserves that are considered redundant. We experienced favorable medical claims reserve development related to prior fiscal years of $825 million in 2021, $313 million in 2020, and $336 million in 2019. The table below details our favorable medical claims reserve development related to prior fiscal years by segment for 2021, 2020, and 2019. (Favorable) Unfavorable Medical Claims Reserve 2021 2020 2019 (in millions) Retail Segment $ (729) $ (266) $ (386) Group and Specialty Segment (96) (47) 50 Total $ (825) $ (313) $ (336) The medical claims reserve development for 2021, 2020, and 2019 primarily reflects the consistent application of trend and completion factors estimated using an assumption of moderately adverse conditions. In addition, the higher prior year favorable development for the year ended December 31, 2021 was primarily attributable to the reversal of actions taken in 2020, including the suspension of certain financial recovery programs for a period of time impacting our claim payment patterns. The suspension during 2020 was intended to provide financial and administrative relief for providers facing unprecedented strain as a result of the COVID-19 pandemic. Incurred and Paid Claims Development The following discussion provides information about incurred and paid claims development for our segments as of December 31, 2021, net of reinsurance, as well as cumulative claim frequency and the total of IBNR included within the net incurred claims amounts. The information about incurred and paid claims development for the years ended December 31, 2020 and 2019 is presented as supplementary information. Claims frequency is measured as medical fee-for-service claims for each service encounter with a unique provider identification number. Our claims frequency measure includes claims covered by deductibles as well as claims under capitated arrangements. Claim counts may vary based on product mix and the percentage of delegated capitation arrangements. Retail Segment Activity in benefits payable for our Retail segment was as follows for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 (in millions) Balances at January 1 $ 7,428 $ 5,363 $ 4,338 Less: Reinsurance recoverables — (68) (95) Balances at January 1, net 7,428 5,295 4,243 Acquisitions 42 — — Incurred related to: Current year 65,636 56,821 48,983 Prior years (729) (266) (386) Total incurred 64,907 56,555 48,597 Paid related to: Current year (58,363) (49,586) (43,831) Prior years (6,339) (4,836) (3,714) Total paid (64,702) (54,422) (47,545) Reinsurance recoverable — — 68 Balances at December 31 $ 7,675 $ 7,428 $ 5,363 At December 31, 2021, benefits payable for our Retail segment included IBNR of approximately $5.2 billion, primarily associated with claims incurred in 2021. The cumulative number of reported claims as of December 31, 2021 was approximately 156.1 million for claims incurred in 2021, 140.4 million for claims incurred in 2020, and 129.1 million for claims incurred in 2019. The following tables provide information about incurred and paid claims development for the Retail segment as of December 31, 2021, net of reinsurance. Incurred Claims, Net of Reinsurance For the Years Ended December 31, Claims Incurred Year 2019 2020 2021 (in millions) 2019 $ 48,983 $ 48,820 $ 48,713 2020 56,821 56,223 2021 65,678 Total $ 170,614 Cumulative Paid Claims, Net of Reinsurance For the Years Ended December 31, Claims Incurred Year 2019 2020 2021 (in millions) 2019 $ 43,831 $ 48,627 $ 48,713 2020 49,586 55,863 2021 58,363 Total 162,939 All outstanding benefit liabilities before 2019, net of reinsurance N/A Benefits payable, net of reinsurance $ 7,675 Group and Specialty Segment Activity in benefits payable for our Group and Specialty segment, excluding military services, was as follows for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 (in millions) Balances at January 1 $ 715 $ 641 $ 517 Incurred related to: Current year 5,047 5,576 5,708 Prior years (96) (47) 50 Total incurred 4,951 5,529 5,758 Paid related to: Current year (4,445) (4,873) (5,081) Prior years (607) (582) (553) Total paid (5,052) (5,455) (5,634) Balances at December 31 $ 614 $ 715 $ 641 At December 31, 2021, benefits payable for our Group and Specialty segment included IBNR of approximately $532 million, primarily associated with claims incurred in 2021. The cumulative number of reported claims as of December 31, 2021 was approximately 8.3 million for claims incurred in 2021, 9.1 million for claims incurred in 2020, and 10.1 million for claims incurred in 2019. The following tables provide information about incurred and paid claims development for the Group and Specialty segment as of December 31, 2021, net of reinsurance. Incurred Claims, Net of Reinsurance For the Years Ended December 31, Claims Incurred Year 2019 2020 2021 (in millions) 2019 $ 5,708 $ 5,657 $ 5,652 2020 5,576 5,491 2021 5,047 Total $ 16,190 Cumulative Paid Claims, Net of Reinsurance For the Years Ended December 31, Claims Incurred Year 2019 2020 2021 (in millions) 2019 $ 5,081 $ 5,465 $ 5,652 2020 4,873 5,479 2021 4,445 Total 15,576 All outstanding benefit liabilities before 2019, net of reinsurance N/A Benefits payable, net of reinsurance $ 614 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The provision for income taxes consisted of the following for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 (in millions) Current provision: Federal $ 466 $ 1,019 $ 560 States and Puerto Rico 4 93 41 Total current provision 470 1,112 601 Deferred expense 15 195 162 Provision for income taxes $ 485 $ 1,307 $ 763 The provision for income taxes was different from the amount computed using the federal statutory rate for the years ended December 31, 2021, 2020 and 2019 due to the following: 2021 2020 2019 (in millions) Income tax provision at federal statutory rate $ 718 $ 982 $ 729 States, net of federal benefit, and Puerto Rico 18 63 49 Tax exempt investment income (3) (5) (6) Nondeductible executive compensation 33 19 25 Non-taxable KAH gain (264) — — Health insurance industry fee — 268 — Other, net (17) (20) (34) Provision for income taxes $ 485 $ 1,307 $ 763 Deferred income tax balances reflect the impact of temporary differences between the tax bases of assets or liabilities and their reported amounts in our consolidated financial statements, and are stated at enacted tax rates expected to be in effect when the reported amounts are actually recovered or settled. Principal components of our net deferred tax balances at December 31, 2021 and 2020 were as follows: Assets (Liabilities) 2021 2020 (in millions) Net operating loss carryforward $ 291 $ 32 Compensation and other accrued expense 186 171 Benefits payable 67 87 Deferred acquisition costs 33 26 Jobs tax credits 33 — Other 25 11 Unearned revenues 8 12 Total deferred income tax assets 643 339 Valuation allowance (65) (37) Total deferred income tax assets, net of valuation allowance 578 302 Depreciable property and intangible assets (1,072) (449) Prepaid expenses (102) (91) Investment securities (98) (418) Future policy benefits payable (4) (3) Total deferred income tax liabilities (1,276) (961) Total net deferred income tax liabilities $ (698) $ (659) All deferred tax liabilities and assets are classified as noncurrent in our consolidated balance sheets as other long-term liabilities at December 31, 2021 and 2020. At December 31, 2021, we had approximately $930 million of federal net operating losses and approximately $1.7 billion of state and Puerto Rico net operating losses to carry forward. A portion of these loss carryforwards, if not used to offset future taxable income, will expire from 2025 through 2038. The balance of the net operating loss carryforwards has no expiration date. Due to limitations and uncertainty regarding our ability to use some of the loss carryforwards and certain other deferred tax assets, a valuation allowance of $65 million was established. For the remainder of the net operating loss carryforwards and other cumulative temporary differences, based on our historical record of producing taxable income and profitability, we have concluded that future operating income will be sufficient to recover these deferred tax assets. We file income tax returns in the United States and Puerto Rico. The U.S. Internal Revenue Service, or IRS, has completed its examinations of our consolidated income tax returns for 2019 and prior years. Our 2020 tax return is in the post-filing review period under the Compliance Assurance Process, or CAP. Our 2021 tax return is under advance review by the IRS under CAP. With a few exceptions, which are immaterial in the aggregate, we are no longer subject to state, local and foreign tax examinations for years before 2018. We are not aware of any material adjustments that may be proposed as a result of any ongoing or future examinations. We do not have material uncertain tax positions reflected in our consolidated balance sheets. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT The carrying value of debt outstanding was as follows at December 31, 2021 and 2020: 2021 2020 (in millions) Short-term debt: Commercial paper $ 955 $ 600 Senior notes: $600 million, 3.15% due December 1, 2022 599 — $400 million, 2.90% due December 15, 2022 399 — Total senior notes 998 — Total short-term debt $ 1,953 $ 600 Long-term debt: Senior notes: $600 million, 3.15% due December 1, 2022 — 598 $400 million, 2.90% due December 15, 2022 — 398 $1.5 billion, 0.65% due August 3, 2023 1,492 — $600 million, 3.85% due October 1, 2024 598 598 $600 million, 4.50% due April 1, 2025 596 595 $750 million, 1.35% due February 3, 2027 742 — $600 million, 3.95% due March 15, 2027 596 596 $500 million, 3.125% due August 15, 2029 496 495 $500 million, 4.875% due April 1, 2030 495 494 $750 million, 2.15% due February 3, 2032 741 — $250 million, 8.15% due June 15, 2038 261 262 $400 million, 4.625% due December 1, 2042 396 396 $750 million, 4.95% due October 1, 2044 740 739 $400 million, 4.80% due March 15, 2047 395 396 $500 million, 3.95% due August 15, 2049 493 493 Term loans: Term loan, due October 29, 2023 2,000 — Delayed draw term loan, due May 28, 2024 500 — Total long-term debt $ 10,541 $ 6,060 Maturities of the short-term and long-term debt for the years ending December 31, are as follows: For the years ending December 31, (in millions) 2022 $ 1,955 2023 3,500 2024 1,100 2025 600 2026 — Thereafter 5,400 Senior Notes Our senior notes, which are unsecured, may be redeemed at our option at any time at 100% of the principal amount plus accrued interest and a specified make-whole amount. The 8.15% senior notes are subject to an interest rate adjustment if the debt ratings assigned to the notes are downgraded (or subsequently upgraded). In addition, our senior notes contain a change of control provision that may require us to purchase the notes under certain circumstances. In August 2021, we issued $1.5 billion of 0.650% unsecured senior notes due August 3, 2023, $750 million of 1.350% unsecured senior notes due February 3, 2027 and $750 million of 2.150% unsecured senior notes due February 3, 2032. Our net proceeds, reduced for the underwriters' discounts and commissions paid, were $2,984 million. We used the net proceeds, together with cash on hand and borrowings under our $500 million delayed draw term loan, to fund the purchase price of KAH and to pay related fees and expenses. Delayed Draw Term Loan Credit Agreement In May 2021, we entered into a $500 million unsecured delayed draw term loan credit agreement. Under the term loan credit agreement, loans bear interest at either LIBOR plus a spread or the base rate plus a spread. The loans under the term loan credit agreement mature on the third anniversary of the funding date. The LIBOR spread, currently 125 basis points, varies depending on our credit ratings ranging from 100.0 to 162.5 basis points. The term loan credit agreement provides for the transition from LIBOR and does not require amendment in connection with such transition. In August 2021, we borrowed $500 million under the delayed draw term loan agreement, which was used, in combination with other debt financing, to fund the approximate $5.8 billion transaction price of Kindred at Home. The term loan credit agreement contains customary restrictive covenants and a financial covenant regarding maximum debt to capitalization of 60%, as well as customary events of default. We are in compliance with this financial covenant, with actual debt to capitalization of 43.7% as measured in accordance with the term loan credit agreement as of December 31, 2021. We have other customary relationships, including financial advisory and banking, with some parties to the term loan agreement. October 2021 Term Loan Agreement On October 29, 2021, we entered into a $2.0 billion term loan credit agreement, which we refer to as the October 2021 Term Loan Agreement, with certain lending banks and other financial institutions. Proceeds of the October 2021 Term Loan Agreement were applied to finance the repayment in full of the outstanding KAH debt. Loans under the October 2021 Term Loan Agreement bear interest at adjusted Term SOFR, as defined in the October 2021 Term Loan Agreement, or the base rate plus a spread. The applicable margin, currently 112.5 basis points, varies depending on our credit ratings ranging from 87.5 to 137.5 basis points. The loans under the October 2021 Term Loan Agreement will mature on October 29, 2023. The October 2021 Term Loan Agreement contains customary covenants, including a maximum debt to capitalization financial condition covenant regarding maximum debt to capitalization of 60%, as well as customary events of default. We are in compliance with this financial covenant, with actual debt to capitalization of 43.7% as measured in accordance with the term loan credit agreement as of December 31, 2021. We have other relationships, including financial advisory and banking, with some parties to the October 2021 Term Loan Agreement. At the time of the repayment in full of the KAH debt, there was $1.9 billion of outstanding debt thereunder and no prepayment penalty was due. Revolving Credit Agreements In June 2021, we entered into two separate revolving credit agreements: (i) a 5-year, $2.5 billion unsecured revolving credit agreement and (ii) a 364-day $1.5 billion unsecured revolving credit agreement. Under the revolving credit agreements, at our option, we can borrow on either a competitive advance basis or a revolving credit basis. The revolving credit portion bears interest at either LIBOR plus a spread or the base rate plus a spread. The competitive advance portion of any borrowings will bear interest at market rates prevailing at the time of borrowing on either a fixed rate or a floating rate based on LIBOR, at our option. The revolving credit agreements provide for the transition from LIBOR and do not require amendment in connection with such transition. The LIBOR spread, currently 110.0 basis points under the 5-year revolving credit agreements and 115.0 basis points under the 364-day revolving credit agreement, varies depending on our credit ratings ranging from 91.0 to 140.0 basis points under the 5-year revolving credit agreement and from 93.0 to 145.0 basis points under the 364-day revolving credit agreement. We also pay an annual facility fee regardless of utilization. This facility fee, currently 15.0 basis points, under the 5-year revolving credit agreement and 10.0 basis points under the 364-day revolving agreement, varies depending on our credit ratings ranging from 9.0 to 22.5 basis points under the 5-year revolving credit agreement and from 7.0 to 17.5 basis points under the 364-day revolving credit agreement. The terms of the revolving credit agreements include standard provisions related to conditions of borrowing which could limit our ability to borrow additional funds. In addition, the credit agreements contain customary restrictive covenants and a financial covenant regarding maximum debt to capitalization of 60%, as well as customary events of default. We are in compliance with this financial covenant, with actual debt to capitalization of 43.7% as measured in accordance with the revolving credit agreements as of December 31, 2021. Upon our agreement with one or more financial institutions, we may expand the aggregate commitments under the revolving credit agreements by up to $750 million in the aggregate, to a maximum of $4.75 billion, across the 5-year and 364-day revolving credit agreements. At December 31, 2021, we had no borrowings and approximately $75 million of letters of credit outstanding under the revolving credit agreements, including those of KAH. Accordingly, as of December 31, 2021, we had $2.4 billion of remaining borrowing capacity under the 5-year revolving credit agreement and $1.5 billion of remaining borrowing capacity under the 364-day revolving credit agreement (which excludes the uncommitted $750 million of incremental loan facilities), none of which would be restricted by our financial covenant compliance requirement. We have other customary relationships, including financial advisory and banking, with some parties to the revolving credit agreements. Commercial Paper Under our commercial paper program we may issue short-term, unsecured commercial paper notes privately placed on a discount basis through certain broker dealers at any time. On February 10, 2022, we increased the size of our commercial paper program to permit the issuance of commercial paper notes in an aggregate principal amount not to exceed $4 billion compared to the prior amount not to exceed $2 billion. Amounts available under the program may be borrowed, repaid and re-borrowed from time to time. The net proceeds of issuances have been and are expected to be used for general corporate purposes. The maximum principal amount outstanding at any one time during the year ended December 31, 2021 was $1,155 million, with $955 million outstanding at December 31, 2021 compared to $600 million outstanding at December 31, 2020. The outstanding commercial paper at December 31, 2021 had a weighted average annual interest rate of 0.33%. Other Short-term Borrowings We are a member, through one subsidiary, of the Federal Home Loan Bank of Cincinnati, or FHLB. As a member we have the ability to obtain short-term cash advances, subject to certain minimum collateral requirements. At December 31, 2021 we had no outstanding short-term FHLB borrowings. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Employee Savings Plan We have defined contribution retirement savings plans covering eligible employees which include matching contributions based on the amount of our employees’ contributions to the plans. The cost of these plans amounted to approximately $259 million in 2021, $236 million in 2020, and $221 million in 2019. The Company’s cash match is invested pursuant to the participant’s contribution direction. Based on the closing price of our common stock of $463.86 on December 31, 2021, approximately 9% of the retirement and savings plan’s assets were invested in our common stock, or approximately 1.4 million shares, representing approximately 1.1% of the shares outstanding as of December 31, 2021. At December 31, 2021, approximately 1.1 million shares of our common stock were reserved for issuance under our defined contribution retirement savings plans. Stock-Based Compensation We have plans under which options to purchase our common stock and restricted stock units have been granted to executive officers, directors and key employees. Awards generally require both a change in control and termination of employment within 2 years of the date of the change in control to accelerate the vesting, including those granted to retirement-eligible participants. The terms and vesting schedules for stock-based awards vary by type of grant. Generally, the awards vest upon time-based conditions. We have also granted awards to certain employees that vest upon a combination of time and performance-based conditions. The stock awards of retirement-eligible participants are generally earned ratably over the service period for each tranche. Accordingly, upon retirement the earned portion of the current tranche will continue to vest on the originally scheduled vest date and any remaining unearned portion of the award will be forfeited. Our equity award program includes a retirement provision that generally treats employees with a combination of age and years of services with the Company totaling 65 or greater, with a minimum required age of 55 and a minimum requirement of 5 years of service, as retirement-eligible. Upon exercise, stock-based compensation awards are settled with authorized but unissued company stock or treasury stock. The compensation expense that has been charged against income for these plans was as follows for the years ended December 31, 2021, 2020, and 2019: 2021 2020 2019 (in millions) Stock-based compensation expense by type: Restricted stock $ 171 $ 171 $ 152 Stock options 9 10 11 Total stock-based compensation expense 180 181 163 Tax benefit recognized (15) (29) (35) Stock-based compensation expense, net of tax $ 165 $ 152 $ 128 The tax benefit recognized in our consolidated financial statements is based on the amount of compensation expense recorded for book purposes, subject to limitations on the deductibility of annual compensation in excess of $500,000 per employee as mandated by the Health Care Reform Law. The actual tax benefit realized in our tax return is based on the intrinsic value, or the excess of the market value over the exercise or purchase price, of stock options exercised and restricted stock vested during the period, subject to limitations on the deductibility of annual compensation in excess of $500,000 per employee as mandated by the Health Care Reform Law. The actual tax benefit realized for the deductions taken on our tax returns from option exercises and restricted stock vesting totaled $28 million in 2021, $32 million in 2020, and $25 million in 2019. There was no capitalized stock-based compensation expense during these years. At December 31, 2021, there were 11.3 million shares reserved for stock award plans under the Humana Inc. 2011 Stock Incentive Plan, or 2011 Plan, and 15.7 million shares reserved for stock award plans under the Humana Inc. 2019 Stock Incentive Plan, or 2019 Plan. These reserved shares included giving effect to, under the 2011 Plan, 3.4 million shares of common stock available for future grants assuming all stock options were granted or 1.5 million shares available for future grants assuming all restricted stock were granted. These reserved shares included giving effect to, under the 2019 Plan, 12.6 million shares of common stock available for future grants assuming all stock options were granted or 3.8 million shares available for future grants assuming all restricted stock were granted. Shares may be issued from authorized but unissued company stock or treasury stock. Restricted Stock Restricted stock is granted with a fair value equal to the market price of our common stock on the date of grant and generally vests in equal annual tranches over a three year period from the date of grant. Certain of our restricted stock grants also include performance-based conditions generally associated with return on invested capital and strategic membership growth. Restricted stock units have forfeitable dividend equivalent rights equal to the dividend paid on common stock. The weighted-average grant date fair value of our restricted stock was $381.34 in 2021, $354.66 in 2020, and $302.09 in 2019. Activity for our restricted stock was as follows for the year ended December 31, 2021: Shares Weighted- (shares in thousands) Nonvested restricted stock at December 31, 2020 911 $ 282.81 Granted 485 381.34 Vested (460) 312.45 Forfeited (63) 347.42 Nonvested restricted stock at December 31, 2021 873 $ 380.55 Approximately 35% of the nonvested restricted stock at December 31, 2021 included performance-based conditions. The fair value of shares vested was $236 million during 2021, $191 million during 2020, and $141 million during 2019. Total compensation expense not yet recognized related to nonvested restricted stock was $192 million at December 31, 2021. We expect to recognize this compensation expense over a weighted-average period of approximately 1.8 years. There are no other contractual terms covering restricted stock once vested. Stock Options Stock options are granted with an exercise price equal to the fair market value of the underlying common stock on the date of grant. Our stock plans, as approved by the Board of Directors and stockholders, define fair market value as the average of the highest and lowest stock prices reported on the composite tape by the New York Stock Exchange on a given date. Exercise provisions vary, but most options vest in whole or in part 1 to 3 years after grant and expire 7 years after grant. The weighted-average fair value of each option granted during 2021, 2020, and 2019 is provided below. The fair value was estimated on the date of grant using the Black-Scholes pricing model with the weighted-average assumptions indicated below: 2021 2020 2019 Weighted-average fair value at grant date $ 92.21 $ 69.73 $ 68.53 Expected option life (years) 3.7 years 4.0 years 4.1 years Expected volatility 33.8 % 24.9 % 25.5 % Risk-free interest rate at grant date 0.4 % 1.2 % 2.4 % Dividend yield 0.7 % 0.7 % 0.7 % We calculate the expected term for our employee stock options based on historical employee exercise behavior and base the risk-free interest rate on a traded zero-coupon U.S. Treasury bond with a term substantially equal to the option’s expected term. The volatility used to value employee stock options is based on historical volatility. We calculate historical volatility using a simple-average calculation methodology based on daily price intervals as measured over the expected term of the option. Activity for our option plans was as follows for the year ended December 31, 2021: Shares Under Weighted-Average (shares in thousands) Options outstanding at December 31, 2020 323 $ 309.04 Granted 93 379.26 Exercised (106) 282.35 Forfeited — — Options outstanding at December 31, 2021 310 $ 339.08 Options exercisable at December 31, 2021 108 $ 308.22 As of December 31, 2021, outstanding stock options, substantially all of which are expected to vest, had an aggregate intrinsic value of $39 million, and a weighted-average remaining contractual term of 4.8 years. As of December 31, 2021, exercisable stock options had an aggregate intrinsic value of $17 million, and a weighted-average remaining contractual term of 3.7 years. The total intrinsic value of stock options exercised during 2021 was $18 million, compared with $51 million during 2020 and $43 million during 2019. Cash received from stock option exercises totaled $30 million in 2021, $61 million in 2020, and $58 million in 2019. Total compensation expense not yet recognized related to nonvested options was $9 million at December 31, 2021. We expect to recognize this compensation expense over a weighted-average period of approximately 1.5 years. |
EARNINGS PER COMMON SHARE COMPU
EARNINGS PER COMMON SHARE COMPUTATION | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
EARNINGS PER COMMON SHARE COMPUTATION | EARNINGS PER COMMON SHARE COMPUTATION Detail supporting the computation of basic and diluted earnings per common share was as follows for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 (dollars in millions, except per Net income available for common stockholders $ 2,933 $ 3,367 $ 2,707 Weighted-average outstanding shares of common stock used to 128,688 132,199 134,055 Dilutive effect of: Employee stock options 64 92 107 Restricted stock 644 721 565 Shares used to compute diluted earnings per common share 129,396 133,012 134,727 Basic earnings per common share $ 22.79 $ 25.47 $ 20.20 Diluted earnings per common share $ 22.67 $ 25.31 $ 20.10 Number of antidilutive stock options and restricted stock awards 216 238 478 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITY Dividends The following table provides details of dividend payments, excluding dividend equivalent rights, in 2019, 2020, and 2021 under our Board approved quarterly cash dividend policy: Payment Amount Total (in millions) 2019 $2.15 $289 2020 $2.43 $322 2021 $2.73 $351 In October 2021, the Board declared a cash dividend of $0.70 per share payable on January 28, 2022 to stockholders of record on December 31, 2021 for an aggregate amount of $90 million. In February 2022, the Board declared a cash dividend of $0.7875 per share payable on April 29, 2022 to stockholders of record on March 31, 2022. Declaration and payment of future quarterly dividends is at the discretion of our Board and may be adjusted as business needs or market conditions change. Stock Repurchases Our Board of Directors may authorize the purchase of our common shares. Under our share repurchase authorization, shares may have been purchased from time to time at prevailing prices in the open market, by block purchases, through plans designed to comply with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, or in privately-negotiated transactions (including pursuant to accelerated share repurchase agreements with investment banks), subject to certain regulatory restrictions on volume, pricing, and timing. On December 14, 2017, our Board of Directors authorized the repurchase of up to $3.0 billion of our common shares expiring on December 31, 2020, exclusive of shares repurchased in connection with employee stock plans. On November 28, 2018, we entered into an accelerated stock repurchase agreement, the November 2018 ASR, with Goldman Sachs to repurchase $750 million of our common stock as part of the $3.0 billion share repurchase program authorized by the Board of Directors on December 14, 2017. On November 29, 2018, we made a payment of $750 million to Goldman Sachs from available cash on hand and received an initial delivery of 1.94 million shares of our common stock from Goldman Sachs. The payment to Goldman Sachs was recorded as a reduction to stockholders’ equity, consisting of a $600 million increase in treasury stock, which reflected the value of the initial 1.94 million shares received upon initial settlement, and a $150 million decrease in capital in excess of par value, which reflected the value of stock held back by Goldman Sachs pending final settlement of the November 2018 ASR. Upon final settlement of the November 2018 ASR on February 28, 2019, we received an additional 0.6 million shares as determined by the average daily volume weighted-averages share price of our common stock during the term of the agreement, less a discount, of $295.15, bringing the total shares received under this program to 2.54 million. In addition, upon settlement we reclassified the $150 million value of stock initially held back by Goldman Sachs from capital in excess of par value to treasury stock. On July 30, 2019, the Board of Directors replaced a previous share repurchase authorization of up to $3 billion (of which approximately $1.03 billion remained unused) with a new authorization for repurchases of up to $3 billion of our common shares exclusive of shares repurchased in connection with employee stock plans, expiring on June 30, 2022. On July 31, 2019, we entered into an accelerated stock repurchase agreement, the July 2019 ASR, with Citibank, N.A., or Citi, to repurchase $1 billion of our common stock as part of the $3 billion repurchase program authorized by the Board of Directors on July 30, 2019. On August 2, 2019, we made a payment of $1 billion to Citi and received an initial delivery of 2.7 million shares of our common stock. We recorded the payment to Citi as a reduction to stockholders’ equity, consisting of an $800 million increase in treasury stock, which reflected the value of the initial 2.7 million shares received upon initial settlement, and a $200 million decrease in capital in excess of par value, which reflected the value of stock held back by Citi pending final settlement of the July 2019 ASR. Upon final settlement of the July 2019 ASR on December 26, 2019, we received an additional 0.7 million shares as determined by the average daily volume weighted-averages share price of our common stock during the term of the agreement, less a discount, of $296.19, bringing the total shares received under the July 2019 ASR to 3.4 million. In addition, upon settlement we reclassified the $200 million value of stock initially held back by Citi from capital in excess of par value to treasury stock. On December 22, 2020, we entered into separate accelerated stock repurchase agreements, ("the December 2020 ASR Agreements"), with Citibank, N.A., or Citi, and JPMorgan Chase Bank, or JPM, to repurchase $1.75 billion of our common stock as part of the $3 billion repurchase program authorized by the Board of Directors on July 30, 2019. On December 23, 2020, in accordance with the December 2020 ASR Agreements, we made a payment of $1.75 billion ($875 million to Citi and $875 million to JPM) and received an initial delivery of 3.8 million shares of our common stock (1.9 million shares each from Citi and JPM). We recorded the payments to Citi and JPM as a reduction to stockholders’ equity, consisting of an $1.5 billion increase in treasury stock, which reflects the value of the initial 3.8 million shares received upon initial settlement, and a $262.5 million decrease in capital in excess of par value, which reflects the value of stock held back by Citi and JPM pending final settlement of the December 2020 ASR Agreements. Upon final settlement of the December 2020 ASR agreements with Citi and JPM on May 4, 2021 and May 5, 2021, respectively, we received an additional 0.3 million shares and 0.3 million shares, respectively, as determined by the average daily volume weighted-averages share price of our common stock during the term of the agreement, less a discount, of $400.07 and $401.49, respectively, bringing the total shares received under the December 2020 ASR agreements to 4.4 million. In addition, upon settlement we reclassified the $262.5 million value of stock initially held back by Citi and JPM from capital in excess of par value to treasury stock. On February 18, 2021, the Board of Directors replaced the previous share repurchase authorization of up to $3 billion (of which approximately $250 million remained unused) with a new authorization for repurchases of up to $3 billion of our common shares exclusive of shares repurchased in connection with employee stock plans, expiring as of February 18, 2024. On January 11, 2022, we entered into separate accelerated stock repurchase agreements ("the January 2022 ASR Agreements"), with Mizuho Markets Americas LLC, or Mizuho, and Wells Fargo Bank, or Wells Fargo, to repurchase $1 billion of our common stock as part of the $3 billion repurchase program authorized by the Board of Directors on February 18, 2021. On January 12, 2022, in accordance with the January 2022 ASR Agreements, we made a payment of $1 billion ($500 million to Mizuho and $500 million to Wells Fargo) and received an initial delivery of 2.2 million shares of our common stock (1.08 million shares each from Mizuho and Wells Fargo). In January 2022, we recorded the payments to Mizuho and Wells Fargo as a reduction to stockholders’ equity, consisting of an $850 million increase in treasury stock, which reflects the value of the initial 2.2 million shares received upon initial settlement, and a $150 million decrease in capital in excess of par value, which reflects the value of stock held back by Mizuho and Wells Fargo pending final settlement of the January 2022 ASR Agreements. The final number of shares that we may receive, or be required to remit, under the agreement, will be determined based on the daily volume-weighted average share price of our common stock over the term of the agreement, less a discount and subject to adjustments pursuant to the terms and conditions of the agreement. We expect final settlement under the agreement to occur during the first quarter of 2022. The agreement contains provisions customary for agreements of this type, including provisions for adjustments to the transaction terms upon certain specified events, the circumstances generally under which final settlement of the agreement may be accelerated, extended, or terminated early by Mizuho, Wells Fargo or Humana as well as various acknowledgments and representations made by the parties to each other. At final settlement, under certain circumstances, we may be entitled to receive additional shares of our common stock from Mizuho and Wells Fargo or we may be required to make a payment. If we are obligated to make payment, we may elect to satisfy such obligation in cash or shares of our common stock. Our remaining repurchase authorization was $2 billion as of February 17, 2022. Excluding shares acquired in connection with employee stock plans, share repurchases were as follows during the years ended December 31, 2021, 2020 and 2019. 2021 2020 2019 Authorization Date Purchase Not to Exceed Shares Cost Shares Cost Shares Cost (in millions) February 2021 3,000 — $ — — $ — — $ — July 2019 3,000 — — 3.80 1,750 3.40 1,000 Total repurchases — $ — 3.80 $ 1,750 3.40 $ 1,000 In connection with employee stock plans, we acquired 0.2 million common shares for $79 million in 2021, 0.2 million common shares for $70 million in 2020, and 0.2 million common shares for $70 million in 2019. Regulatory Requirements Certain of our subsidiaries operate in states that regulate the payment of dividends, loans, or other cash transfers to Humana Inc., our parent company, and require minimum levels of equity as well as limit investments to approved securities. The amount of dividends that may be paid to Humana Inc. by these subsidiaries, without prior approval by state regulatory authorities, or ordinary dividends, is limited based on the entity’s level of statutory income and statutory capit al and surplus. If the dividend, together with other dividends paid within the preceding twelve months, exceeds a specified statutory limit or is paid from sources other than earned surplus, it is generally considered an extraordinary dividend requiring prior regulatory approval. In most states, prior notification is provided before paying a dividend even if approval is not required. Although minimum required levels of equity are largely based on premium volume, product mix, and the quality of assets held, minimum requirements vary significantly at the state level. Our state regulated insurance subsidiaries had aggregate statutory capital and surplus of approximately $9.6 billion and $9.4 billion as of December 31, 2021 and 2020, respectively, which exceeded aggregate minimum regulatory requirements of $7.6 billion and $7.0 billion, respectively. The amount of ordinary dividends that may be paid to our parent company in 2022 is approximately $1.5 billion in the aggregate. The amount, timing and mix of ordinary and extraordinary dividend payments will vary due to state regulatory requirements, the level of excess statutory capital and surplus |
COMMITMENTS, GUARANTEES AND CON
COMMITMENTS, GUARANTEES AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS, GUARANTEES AND CONTINGENCIES | COMMITMENTS, GUARANTEES AND CONTINGENCIES Purchase Obligations We have agreements to purchase services, primarily information technology related services, or to make improvements to real estate, in each case that are enforceable and legally binding on us and that specify all significant terms, including: fixed or minimum levels of service to be purchased; fixed, minimum or variable price provisions; and the appropriate timing of the transaction. We have purchase obligation commitments of $656 million in 2022, $310 million in 2023, $192 million in 2024, $97 million in 2025, and $52 million in 2026. Purchase obligations exclude agreements that are cancellable without penalty. Off-Balance Sheet Arrangements As part of our ongoing business, we do not participate or knowingly seek to participate in transactions that generate relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, or SPEs, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. As of December 31, 2021, we were not involved in any SPE transactions. Guarantees and Indemnifications Through indemnity agreements approved by the state regulatory authorities, certain of our regulated subsidiaries generally are guaranteed by Humana Inc., our parent company, in the event of insolvency for (1) member coverage for which premium payment has been made prior to insolvency; (2) benefits for members then hospitalized until discharged; and (3) payment to providers for services rendered prior to insolvency. Our parent also has guaranteed the obligations of certain of our non-regulated subsidiaries and funding to maintain required statutory capital levels of certain regulated subsidiaries. In the ordinary course of business, we enter into contractual arrangements under which we may agree to indemnify a third party to such arrangement from any losses incurred relating to the services they perform on behalf of us, or for losses arising from certain events as defined within the particular contract, which may include, for example, litigation or claims relating to past performance. Such indemnification obligations may not be subject to maximum loss clauses. Historically, payments made related to these indemnifications have been immaterial. Government Contracts Our Medicare products, which accounted for approximately 82% of our total premiums and services revenue for the year ended December 31, 2021, primarily consisted of products covered under the Medicare Advantage and Medicare Part D Prescription Drug Plan contracts with the federal government. These contracts are renewed generally for a calendar year term unless CMS notifies us of its decision not to renew by May 1 of the calendar year in which the contract would end, or we notify CMS of our decision not to renew by the first Monday in June of the calendar year in which the contract would end. All material contracts between Humana and CMS relating to our Medicare products have been renewed for 2022, and all of our product offerings filed with CMS for 2022 have been approved. CMS uses a risk-adjustment model which adjusts premiums paid to Medicare Advantage, or MA, plans according to health status of covered members. The risk-adjustment model, which CMS implemented pursuant to the Balanced Budget Act of 1997 (BBA) and the Benefits Improvement and Protection Act of 2000 (BIPA), generally pays more where a plan's membership has higher expected costs. Under this model, rates paid to MA plans are based on actuarially determined bids, which include a process whereby our prospective payments are based on our estimated cost of providing standard Medicare-covered benefits to an enrollee with a "national average risk profile." That baseline payment amount is adjusted to reflect the health status of our enrolled membership. Under the risk-adjustment methodology, all MA plans must collect from providers and submit the necessary diagnosis code information to CMS within prescribed deadlines. The CMS risk-adjustment model uses the diagnosis data to calculate the risk-adjusted premium payment to MA plans, which CMS adjusts for coding pattern differences between the health plans and the government fee-for-service program. We generally rely on providers, including certain providers in our network who are our employees, to code their claim submissions with appropriate diagnoses, which we send to CMS as the basis for our payment received from CMS under the actuarial risk-adjustment model. We also rely on these providers to document appropriately all medical data, including the diagnosis data submitted with claims. In addition, we conduct medical record reviews as part of our data and payment accuracy compliance efforts, to more accurately reflect diagnosis conditions under the risk adjustment model. These compliance efforts include the internal contract level audits described in more detail below, as well as ordinary course reviews of our internal business processes. CMS is phasing-in the process of calculating risk scores using diagnoses data from the Risk Adjustment Processing System, or RAPS, to diagnoses data from the Encounter Data System, or EDS. The RAPS process requires MA plans to apply a filter logic based on CMS guidelines and only submit diagnoses that satisfy those guidelines. For submissions through EDS, CMS requires MA plans to submit all the encounter data and CMS will apply the risk adjustment filtering logic to determine the risk scores. For 2021, 75% of the risk score was calculated from claims data submitted through EDS. CMS will complete the phased-in transition from RAPS to EDS by using only EDS data to calculate risk scores in 2022. The phase-in from RAPS to EDS could result in different risk scores from each dataset as a result of plan processing issues, CMS processing issues, or filtering logic differences between RAPS and EDS, and could have a material adverse effect on our results of operations, financial position, or cash flows. CMS and the Office of the Inspector General of Health and Human Services, or HHS-OIG, are continuing to perform audits of various companies’ selected MA contracts related to this risk adjustment diagnosis data. We refer to these audits as Risk-Adjustment Data Validation Audits, or RADV audits. RADV audits review medical records in an attempt to validate provider medical record documentation and coding practices which influence the calculation of premium payments to MA plans. In 2012, CMS released a “Notice of Final Payment Error Calculation Methodology for Part C Medicare Advantage Risk Adjustment Data Validation (RADV) Contract-Level Audits.” The payment error calculation methodology provided that, in calculating the economic impact of audit results for an MA contract, if any, the results of the RADV audit sample would be extrapolated to the entire MA contract after a comparison of the audit results to a similar audit of the government’s traditional fee-for-service Medicare program, or Medicare FFS. We refer to the process of accounting for errors in FFS claims as the "FFS Adjuster." This comparison of RADV audit results to the FFS error rate is necessary to determine the economic impact, if any, of RADV audit results because the government used the Medicare FFS program data set, including any attendant errors that are present in that data set, to estimate the costs of various health status conditions and to set the resulting adjustments to MA plans’ payment rates in order to establish actuarial equivalence in payment rates as required under the Medicare statute. CMS already makes other adjustments to payment rates based on a comparison of coding pattern differences between MA plans and Medicare FFS data (such as for frequency of coding for certain diagnoses in MA plan data versus the Medicare FFS program dataset). The final RADV extrapolation methodology, including the first application of extrapolated audit results to determine audit settlements, is expected to be applied to CMS RADV contract level audits conducted for contract year 2011 and subsequent years. CMS is currently conducting RADV contract level audits for certain of our Medicare Advantage plans. Estimated audit settlements are recorded as a reduction of premiums revenue in our consolidated statements of income, based upon available information. We perform internal contract level audits based on the RADV audit methodology prescribed by CMS. Included in these internal contract level audits is an audit of our Private Fee-For Service business which we used to represent a proxy of the FFS Adjuster which has not yet been finalized. We based our accrual of estimated audit settlements for each contract year on the results of these internal contract level audits and update our estimates as each audit is completed. Estimates derived from these results were not material to our results of operations, financial position, or cash flows. We report the results of these internal contract level audits to CMS, including identified overpayments, if any. On October 26, 2018, CMS issued a proposed rule and accompanying materials (which we refer to as the “Proposed Rule”) related to, among other things, the RADV audit methodology described above. If implemented, the Proposed Rule would use extrapolation in RADV audits applicable to payment year 2011 contract-level audits and all subsequent audits, without the application of a FFS Adjuster to audit findings. We believe that the Proposed Rule fails to address adequately the statutory requirement of actuarial equivalence, and have provided substantive comments to CMS on the Proposed Rule as part of the notice-and-comment rulemaking process. Whether, and to what extent, CMS finalizes the Proposed Rule, and any related regulatory, industry or company reactions, could have a material adverse effect on our results of operations, financial position, or cash flows. In addition, as part of our internal compliance efforts, we routinely perform ordinary course reviews of our internal business processes related to, among other things, our risk coding and data submissions in connection with the risk adjustment model. These reviews may also result in the identification of errors and the submission of corrections to CMS, that may, either individually or in the aggregate, be material. As such, the result of these reviews may have a material adverse effect on our results of operations, financial position, or cash flows. We will continue to work with CMS to ensure that MA plans are paid accurately and that payment model principles are in accordance with the requirements of the Social Security Act, which, if not implemented correctly could have a material adverse effect on our results of operations, financial position, or cash flows. Our state-based Medicaid business accounted for approximately 6% of our total premiums and services revenue for the year ended December 31, 2021 primarily serving members enrolled in Medicaid, and in certain circumstances members who qualify for both Medicaid and Medicare, under contracts with various states. At December 31, 2021, our military services business, which accounted for approximately 1% of our total premiums and services revenue for the year ended December 31, 2021, primarily consisted of the TRICARE T2017 East Region contract. The T2017 East Region contract comprises 32 states and approximately six million TRICARE beneficiaries, under which delivery of health care services commenced on January 1, 2018. The T2017 East Region contract is a 5-year contract set to expire on December 31, 2022, unless extended, and is subject to renewals on January 1 of each year during its term at the government's option. The loss of any of the contracts above or significant changes in these programs as a result of legislative or regulatory action, including reductions in premium payments to us, regulatory restrictions on profitability, including reviews by regulatory bodies that may compare our Medicare Advantage profitability to our non-Medicare Advantage business profitability, or compare the profitability of various products within our Medicare Advantage business, and require that they remain within certain ranges of each other, or increases in member benefits or member eligibility criteria without corresponding increases in premium payments to us, may have a material adverse effect on our results of operations, financial position, and cash flows. Legal Proceedings and Certain Regulatory Matters As previously disclosed, the Civil Division of the United States Department of Justice provided us with an information request in December 2014, concerning our Medicare Part C risk adjustment practices. The request relates to our oversight and submission of risk adjustment data generated by providers in our Medicare Advantage network, as well as to our business and compliance practices related to risk adjustment data generated by our providers and by us, including medical record reviews conducted as part of our data and payment accuracy compliance efforts, the use of health and well-being assessments, and our fraud detection efforts. We believe that this request for information is in connection with a wider review of Medicare Risk Adjustment generally that includes a number of Medicare Advantage plans, providers and vendors. We continue to cooperate with the Department of Justice. These matters are expected to result in additional qui tam litigation. As previously disclosed, on January 19, 2016, an individual filed a qui tam suit captioned United States of America ex rel. Steven Scott v. Humana, Inc., in United States District Court, Central District of California, Western Division. The complaint alleges certain civil violations by us in connection with the actuarial equivalence of the plan benefits under Humana’s Basic PDP plan, a prescription drug plan offered by us under Medicare Part D. The action seeks damages and penalties on behalf of the United States under the False Claims Act. The court ordered the qui tam action unsealed on September 13, 2017, so that the relator could proceed, following notice from the U.S. Government that it was not intervening at that time. On January 29, 2018, the suit was transferred to the United States District Court, Western District of Kentucky, Louisville Division. We take seriously our obligations to comply with applicable CMS requirements and actuarial standards of practice, and continue to vigorously defend against these allegations since the transfer to the Western District of Kentucky. We have substantially completed discovery with the relator who has pursued the matter on behalf of the United States following its unsealing, and expect the Court to consider our motion for summary judgment. Other Lawsuits and Regulatory Matters Our current and past business practices are subject to review or other investigations by various state insurance and health care regulatory authorities and other state and federal regulatory authorities. These authorities regularly scrutinize the business practices of health insurance, health care delivery and benefits companies. These reviews focus on numerous facets of our business, including claims payment practices, statutory capital requirements, provider contracting, risk adjustment, competitive practices, commission payments, privacy issues, utilization management practices, pharmacy benefits, access to care, sales practices, and provision of care by our healthcare services businesses, among others. Some of these reviews have historically resulted in fines imposed on us and some have required changes to some of our practices. We continue to be subject to these reviews, which could result in additional fines or other sanctions being imposed on us or additional changes in some of our practices. We also are involved in various other lawsuits that arise, for the most part, in the ordinary course of our business operations, certain of which may be styled as class-action lawsuits. Among other matters, this litigation may include employment matters, claims of medical malpractice, bad faith, nonacceptance or termination of providers, anticompetitive practices, improper rate setting, provider contract rate and payment disputes, including disputes over reimbursement rates required by statute, disputes arising from competitive procurement process, general contractual matters, intellectual property matters, and challenges to subrogation practices. Under state guaranty assessment laws, including those related to state cooperative failures in the industry, we may be assessed (up to prescribed limits) for certain obligations to the policyholders and claimants of insolvent insurance companies that write the same line or lines of business as we do. As a government contractor, we may also be subject to false claims litigation, such as qui tam lawsuits brought by individuals who seek to sue on behalf of the government, alleging that the government contractor submitted false claims to the government or related overpayments from the government, including, among other allegations, those resulting from coding and review practices under the Medicare risk adjustment model. Qui tam litigation is filed under seal to allow the government an opportunity to investigate and to decide if it wishes to intervene and assume control of the litigation. If the government does not intervene, the individual may continue to prosecute the action on his or her own, on behalf of the government. We also are subject to other allegations of nonperformance of contractual obligations to providers, members, and others, including failure to properly pay claims, improper policy terminations, challenges to our implementation of the Medicare Part D prescription drug program and other litigation. A limited number of the claims asserted against us are subject to insurance coverage. Personal injury claims, claims for extra contractual damages, care delivery malpractice, and claims arising from medical benefit denials are covered by insurance from our wholly owned captive insurance subsidiary and excess carriers, except to the extent that claimants seek punitive damages, which may not be covered by insurance in certain states in which insurance coverage for punitive damages is not permitted. In addition, insurance coverage for all or certain forms of liability has become increasingly costly and may become unavailable or prohibitively expensive in the future. We record accruals for the contingencies discussed in the sections above to the extent that we conclude it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. No estimate of the possible loss or range of loss in excess of amounts accrued, if any, can be made at this time regarding the matters specifically described above because of the inherently unpredictable nature of legal proceedings, which also may be exacerbated by various factors, including: (i) the damages sought in the proceedings are unsubstantiated or indeterminate; (ii) discovery is not complete; (iii) the proceeding is in its early stages; (iv) the matters present legal uncertainties; (v) there are significant facts in dispute; (vi) there are a large number of parties (including where it is uncertain how liability, if any, will be shared among multiple defendants); or (vii) there is a wide range of potential outcomes. The outcome of any current or future litigation or governmental or internal investigations, including the matters described above, cannot be accurately predicted, nor can we predict any resulting judgments, penalties, fines or other sanctions that may be imposed at the discretion of federal or state regulatory authorities or as a result of actions by third parties. Nevertheless, it is reasonably possible that any such outcome of litigation, judgments, penalties, fines or other sanctions could be substantial, and the outcome of these matters may have a material adverse effect on our results of operations, financial position, and cash flows, and may also affect our reputation. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION We manage our business with three reportable segments: Retail, Group and Specialty, and Healthcare Services. The reportable segments are based on a combination of the type of health plan customer and adjacent businesses centered on well-being solutions for our health plans and other customers, as described below. These segment groupings are consistent with information used by our Chief Executive Officer, the Chief Operating Decision Maker, to assess performance and allocate resources. The Retail segment consists of Medicare benefits, marketed to individuals or directly via group Medicare accounts. In addition, the Retail segment also includes our contract with CMS to administer the Limited Income Newly Eligible Transition, or LI-NET, prescription drug plan program and contracts with various states to provide Medicaid, dual eligible demonstration, and Long-Term Support Services benefits, which we refer to collectively as our state-based contracts. The Group and Specialty segment consists of employer group commercial fully-insured medical and specialty health insurance benefits marketed to individuals and employer groups, including dental, vision, and other supplemental health benefits, as well as administrative services only, or ASO products. In addition, our Group and Specialty segment includes our military services business, primarily our TRICARE T2017 East Region contract. The Healthcare Services segment includes pharmacy, provider, and home services, along with other services and capabilities to promote wellness and advance population health. The operations of the recently acquired full ownership of Kindred at Home, as well as the company's strategic partnership with Welsh, Carson, Anderson & Stowe (WCAS) to develop and operate senior-focused, payor-agnostic, primary care centers are also included in the Healthcare Services segment. Our Healthcare Services intersegment revenues primarily relate to managing prescription drug coverage for members of our other segments through Humana Pharmacy Solutions®, or HPS, and includes the operations of Humana Pharmacy, Inc., our mail order pharmacy business. These revenues consist of the prescription price (ingredient cost plus dispensing fee), including the portion to be settled with the member (co-share) or with the government (subsidies), plus any associated administrative fees. Services revenues related to the distribution of prescriptions by third party retail pharmacies in our networks are recognized when the claim is processed and product revenues from dispensing prescriptions from our mail order pharmacies are recorded when the prescription or product is shipped. Our pharmacy operations, which are responsible for designing pharmacy benefits, including defining member co-share responsibilities, determining formulary listings, contracting with retail pharmacies, confirming member eligibility, reviewing drug utilization, and processing claims, act as a principal in the arrangement on behalf of members in our other segments. As principal, our Healthcare Services segment reports revenues on a gross basis, including co-share amounts from members collected by third party retail pharmacies at the point of service. In addition, our Healthcare Services intersegment revenues include revenues earned by certain owned providers derived from risk-based and non-risk-based managed care agreements with our health plans. Under risk based agreements, the provider receives a monthly capitated fee that varies depending on the demographics and health status of the member, for each member assigned to these owned providers by our health plans. The owned provider assumes the economic risk of funding the assigned members’ healthcare services. Under non risk-based agreements, our health plans retain the economic risk of funding the assigned members' healthcare services. Our Healthcare Services segment reports provider services revenues associated with risk-based agreements on a gross basis, whereby capitation fee revenue is recognized in the period in which the assigned members are entitled to receive healthcare services. Provider services revenues associated with non-risk-based agreements are presented net of associated healthcare costs. We present our consolidated results of operations from the perspective of the health plans. As a result, the cost of providing benefits to our members, whether provided via a third party provider or internally through a stand-alone subsidiary, is classified as benefits expense and excludes the portion of the cost for which the health plans do not bear responsibility, including member co-share amounts and government subsidies of $18.1 billion in 2021, $16.5 billion in 2020, and $14.9 billion in 2019. In addition, depreciation and amortization expense associated with certain businesses in our Healthcare Services segment delivering benefits to our members, primarily associated with our provider services and pharmacy operations, are included with benefits expense. The amount of this expense was $108 million in 2021, $127 million in 2020, and $117 million in 2019. Other than those described previously, the accounting policies of each segment are the same and are described in Note 2. Transactions between reportable segments primarily consist of sales of services rendered by our Healthcare Services segment, primarily pharmacy, provider, and home services, to our Retail and Group and Specialty segment customers. Intersegment sales and expenses are recorded at fair value and eliminated in consolidation. Members served by our segments often use the same provider networks, enabling us in some instances to obtain more favorable contract terms with providers. Our segments also share indirect costs and assets. As a result, the profitability of each segment is interdependent. We allocate most operating expenses to our segments. Assets and certain corporate income and expenses are not allocated to the segments, including the portion of investment income not supporting segment operations, interest expense on corporate debt, and certain other corporate expenses. These items are managed at a corporate level. These corporate amounts are reported separately from our reportable segments and are included with intersegment eliminations in the tables presenting segment results below. Premium and services revenues derived from our contracts with the federal government, as a percentage of our total premium and services revenues, were approximately 83% for 2021, 83% for 2020 and 82% for 2019. Retail Group and Specialty Healthcare Services Eliminations/ Consolidated (in millions) 2021 External revenues Premiums: Individual Medicare Advantage $ 58,654 $ — $ — $ — $ 58,654 Group Medicare Advantage 6,955 — — — 6,955 Medicare stand-alone PDP 2,371 — — — 2,371 Total Medicare 67,980 — — — 67,980 Fully-insured 731 4,271 — — 5,002 Specialty — 1,731 — — 1,731 Medicaid and other 5,109 — — — 5,109 Total premiums 73,820 6,002 — — 79,822 Services revenue: Home Solutions — — 1,166 — 1,166 Provider — — 413 — 413 ASO and other 23 816 — — 839 Pharmacy — — 637 — 637 Total services revenue 23 816 2,216 — 3,055 Total external revenues 73,843 6,818 2,216 — 82,877 Intersegment revenues Services 1 40 19,998 (20,039) — Products — — 9,024 (9,024) — Total intersegment revenues 1 40 29,022 (29,063) — Investment income 200 14 4 (31) 187 Total revenues 74,044 6,872 31,242 (29,094) 83,064 Operating expenses: Benefits 64,907 4,951 — (659) 69,199 Operating costs 6,764 1,687 29,801 (28,131) 10,121 Depreciation and amortization 436 85 177 (102) 596 Total operating expenses 72,107 6,723 29,978 (28,892) 79,916 Income (loss) from operations 1,937 149 1,264 (202) 3,148 Interest expense — — — 326 326 Other income, net — — — (532) (532) Income before income taxes and equity in net earnings 1,937 149 1,264 4 3,354 Equity in net earnings — — 65 — 65 Segment earnings $ 1,937 $ 149 $ 1,329 $ 4 $ 3,419 Less: noncontrolling interests — — (1) — (1) Segment earnings attributable to Humana $ 1,937 $ 149 $ 1,328 $ 4 $ 3,418 Retail Group and Specialty Healthcare Services Eliminations/ Consolidated (in millions) 2020 External revenues Premiums: Individual Medicare Advantage $ 51,697 $ — $ — $ — $ 51,697 Group Medicare Advantage 7,774 — — — 7,774 Medicare stand-alone PDP 2,742 — — — 2,742 Total Medicare 62,213 — — — 62,213 Fully-insured 688 4,761 — 602 6,051 Specialty — 1,699 — — 1,699 Medicaid and other 4,223 — — — 4,223 Total premiums 67,124 6,460 — 602 74,186 Services revenue: Home Solutions — — 107 — 107 Provider — — 328 — 328 ASO and other 19 780 — — 799 Pharmacy — — 581 — 581 Total services revenue 19 780 1,016 — 1,815 Total external revenues 67,143 7,240 1,016 602 76,001 Intersegment revenues Services — 29 19,491 (19,520) — Products — — 7,928 (7,928) — Total intersegment revenues — 29 27,419 (27,448) — Investment income 155 16 13 970 1,154 Total revenues 67,298 7,285 28,448 (25,876) 77,155 Operating expenses: Benefits 56,537 5,529 — (438) 61,628 Operating costs 7,402 1,818 27,395 (26,563) 10,052 Depreciation and amortization 342 81 183 (117) 489 Total operating expenses 64,281 7,428 27,578 (27,118) 72,169 Income (loss) from operations 3,017 (143) 870 1,242 4,986 Interest expense — — — 283 283 Other expense, net — — — 103 103 Income (loss) before income taxes and equity in net earnings 3,017 (143) 870 856 4,600 Equity in net earnings — — 74 — 74 Segment earnings (loss) $ 3,017 $ (143) $ 944 $ 856 $ 4,674 Retail Group and Specialty Healthcare Services Eliminations/ Consolidated (in millions) 2019 External revenues Premiums: Individual Medicare Advantage $ 43,128 $ — $ — $ — $ 43,128 Group Medicare Advantage 6,475 — — — 6,475 Medicare stand-alone PDP 3,165 — — — 3,165 Total Medicare 52,768 — — — 52,768 Fully-insured 588 5,123 — — 5,711 Specialty — 1,571 — — 1,571 Medicaid and other 2,898 — — — 2,898 Total premiums 56,254 6,694 — — 62,948 Services revenue: Home Solutions — — 140 — 140 Provider — — 306 — 306 ASO and other 17 790 — — 807 Pharmacy — — 186 — 186 Total services revenue 17 790 632 — 1,439 Total external revenues 56,271 7,484 632 — 64,387 Intersegment revenues Services — 18 18,255 (18,273) — Products — — 6,894 (6,894) — Total intersegment revenues — 18 25,149 (25,167) — Investment income 195 23 2 281 501 Total revenues 56,466 7,525 25,783 (24,886) 64,888 Operating expenses: Benefits 48,602 5,758 — (503) 53,857 Operating costs 5,306 1,651 24,852 (24,428) 7,381 Depreciation and amortization 323 88 156 (109) 458 Total operating expenses 54,231 7,497 25,008 (25,040) 61,696 Income from operations 2,235 28 775 154 3,192 Interest expense — — — 242 242 Other income, net — — — (506) (506) Income before income taxes and equity in net earnings 2,235 28 775 418 3,456 Equity in net earnings — — 14 — 14 Segment earnings $ 2,235 $ 28 $ 789 $ 418 $ 3,470 |
REINSURANCE
REINSURANCE | 12 Months Ended |
Dec. 31, 2021 | |
Insurance [Abstract] | |
REINSURANCE | REINSURANCE Certain blocks of insurance assumed in acquisitions, primarily life and annuities in run-off status are subject to reinsurance where some or all of the underwriting risk related to these policies has been ceded to a third party. In addition, a large portion of our reinsurance takes the form of 100% coinsurance agreements where, in addition to all of the underwriting risk, all administrative responsibilities, including premium collections and claim payment, have also been ceded to a third party. We acquired these policies and related reinsurance agreements with the purchase of stock of companies in which the policies were originally written. We acquired these companies for business reasons unrelated to these particular policies, including the companies’ other products and licenses necessary to fulfill strategic plans. A reinsurance agreement between two entities transfers the underwriting risk of policyholder liabilities to a reinsurer while the primary insurer retains the contractual relationship with the ultimate insured. As such, these reinsurance agreements do not completely relieve us of our potential liability to the ultimate insured. However, given the transfer of underwriting risk, our potential liability is limited to the credit exposure which exists should the reinsurer be unable to meet its obligations assumed under these reinsurance agreements. Reinsurance recoverables represent the portion of future policy benefits payable and benefits payable that are covered by reinsurance. Reinsurance recoverables, included in other current and long-term assets, were $188 million at December 31, 2021 and $194 million at December 31, 2020. The amount of these reinsurance recoverables resulting from 100% coinsurance agreements was approximately $188 million at December 31, 2021 and approximately $193 million at December 31, 2020. Premiums ceded were $6 million in 2021, $29 million in 2020 and $1 billion in 2019. Benefits ceded were $2 million in 2021, $7 million in 2020, and $881 million in 2019. Ceded premium and benefits in 2019 reflect the activity associated with ceding all risk under a Medicaid contract to a third party reinsurer. The reinsurance agreement ceding all risk under the Medicaid contract was terminated effective January 1, 2020. We evaluate the financial condition of our reinsurers on a regular basis. Protective Life Insurance Company with $169 million in reinsurance recoverables is well-known and well-established with a AM Best rating of A+ at December 31, 2021. The remaining reinsurance recoverables of $19 million are divided between 10 other reinsurers, with $2 million subject to funds withheld accounts or other financial guarantees supporting the repayment of these amounts. |
SCHEDULE I - PARENT COMPANY FIN
SCHEDULE I - PARENT COMPANY FINANCIAL INFORMATION | 12 Months Ended |
Dec. 31, 2021 | |
Condensed Financial Information Disclosure [Abstract] | |
SCHEDULE I - PARENT COMPANY FINANCIAL INFORMATION | SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION CONDENSED BALANCE SHEETS December 31, 2021 2020 (in millions, except share ASSETS Current assets: Cash and cash equivalents $ 906 $ 436 Investment securities 428 336 Receivable from operating subsidiaries 1,316 1,187 Other current assets 545 763 Total current assets 3,195 2,722 Property and equipment, net 2,223 1,774 Investments in subsidiaries 26,885 17,005 Equity method investment 52 1,147 Long-term investment securities 207 836 Other long-term assets 407 686 Total assets $ 32,969 $ 24,170 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Payable to operating subsidiaries $ 2,056 $ 1,342 Current portion of notes payable to operating subsidiaries 36 36 Book overdraft 68 120 Short-term debt 1,953 600 Other current liabilities 1,460 1,438 Total current liabilities 5,573 3,536 Long-term debt 10,541 6,060 Other long-term liabilities 775 846 Total liabilities 16,889 10,442 Commitments and contingencies Stockholders’ equity: Preferred stock, $1 par; 10,000,000 shares authorized; none issued — — Common stock, $0.16 2/3 par; 300,000,000 shares authorized; 198,648,742 shares issued at December 31, 2021 and December 31, 2020 33 33 Capital in excess of par value 3,082 2,705 Retained earnings 23,086 20,517 Accumulated other comprehensive income (loss) 42 391 Treasury stock, at cost, 69,846,758 shares at December 31, 2021 and 69,787,914 shares at December 31, 2020 (10,163) (9,918) Total stockholders’ equity 16,080 13,728 Total liabilities and stockholders’ equity $ 32,969 $ 24,170 See accompanying notes to the parent company financial statements. SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION CONDENSED STATEMENTS OF INCOME For the year ended December 31, 2021 2020 2019 (in millions) Revenues: Management fees charged to operating subsidiaries $ 1,633 $ 2,216 $ 1,789 Investment and other (loss) income, net (266) 763 28 1,367 2,979 1,817 Expenses: Operating costs 1,404 2,204 1,577 Depreciation 488 397 387 Interest 313 283 242 2,205 2,884 2,206 Other (income) expense, net (672) 60 (506) (Loss) income before income taxes and equity in net earnings of subsidiaries (166) 35 117 (Benefit) provision for income taxes (259) 18 27 Income before equity in net earnings of subsidiaries 93 17 90 Equity in net earnings of subsidiaries 2,761 3,269 2,603 Equity in net earnings of Kindred at Home 79 81 14 Net income $ 2,933 $ 3,367 $ 2,707 See accompanying notes to the parent company financial statements. SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION CONDENSED STATEMENTS OF COMPREHENSIVE INCOME For the year ended December 31, 2021 2020 2019 (in millions) Net income attributable to Humana $ 2,933 $ 3,367 $ 2,707 Other comprehensive income (loss): Change in gross unrealized investment (losses) gains (356) 393 450 Effect of income taxes 81 (89) (105) Total change in unrealized investment (275) 304 345 Reclassification adjustment for net realized (103) (90) (34) Effect of income taxes 23 20 8 Total reclassification adjustment, net of tax (80) (70) (26) Other comprehensive (loss) income, net of tax (355) 234 319 Comprehensive income (loss) attributable to our equity method 6 1 (4) Comprehensive income $ 2,584 $ 3,602 $ 3,022 See accompanying notes to the parent company financial statements. SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION CONDENSED STATEMENTS OF CASH FLOWS For the year ended December 31, 2021 2020 2019 (in millions) Net cash provided by operating activities $ 2,853 $ 2,531 $ 3,529 Cash flows from investing activities: Acquisitions, net of cash acquired (4,187) (709) — Capital contributions to operating subsidiaries (2,580) (538) (423) Purchases of investment securities (200) (460) (204) Proceeds from sale of investment securities 71 13 15 Maturities of investment securities 122 411 134 Purchases of property and equipment, net (958) (785) (585) Net cash used in investing activities (7,732) (2,068) (1,063) Cash flows from financing activities: Proceeds from issuance of senior notes, net 2,953 1,088 987 Repayment of senior notes — (400) (400) Proceeds (repayments) from issuance of commercial paper, net 352 295 (360) Proceeds from term loan 2,500 1,000 — Repayment of term loan — (1,000) (650) Change in book overdraft (52) 80 2 Common stock repurchases (79) (1,820) (1,070) Dividends paid (354) (323) (291) Proceeds from stock option exercises and other 29 47 57 Net cash provided by (used in) financing activities 5,349 (1,033) (1,725) Increase (decrease) in cash and cash equivalents 470 (570) 741 Cash and cash equivalents at beginning of year 436 1,006 265 Cash and cash equivalents at end of year $ 906 $ 436 $ 1,006 See accompanying notes to the parent company financial statements. SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION NOTES TO CONDENSED FINANCIAL STATEMENTS Management Fee Through intercompany service agreements approved, if required, by state regulatory authorities, Humana Inc., our parent company, charges a management fee for reimbursement of certain centralized services provided to its subsidiaries including information systems, disbursement, investment and cash administration, marketing, legal, finance, and medical and executive management oversight. Dividends Cash dividends received from subsidiaries and included as a component of net cash provided by operating activities were $1.6 billion in 2021, $1.3 billion in 2020, and $1.8 billion in 2019. Guarantee Through indemnity agreements approved by state regulatory authorities, certain of our regulated subsidiaries generally are guaranteed by our parent company in the event of insolvency for: (1) member coverage for which premium payment has been made prior to insolvency; (2) benefits for members then hospitalized until discharged; and (3) payment to providers for services rendered prior to insolvency. Our parent has also guaranteed the obligations of our military services subsidiaries and funding to maintain required statutory capital levels of certain other regulated subsidiaries. Certain of our subsidiaries operate in states that regulate the payment of dividends, loans, or other cash transfers to Humana Inc., our parent company, and require minimum levels of equity as well as limit investments to approved securities. The amount of dividends that may be paid to Humana Inc. by these subsidiaries, without prior approval by state regulatory authorities, or ordinary dividends, is limited based on the entity’s level of statutory income and statutory capit al and surplus. If the dividend, together with other dividends paid within the preceding twelve months, exceeds a specified statutory limit or is paid from sources other than earned surplus, it is generally considered an extraordinary dividend requiring prior regulatory approval. In most states, prior notification is provided before paying a dividend even if approval is not required. Although minimum required levels of equity are largely based on premium volume, product mix, and the quality of assets held, minimum requirements vary significantly at the state level. Our state regulated insurance subsidiaries had aggregate statutory capital and surplus of approximately $9.6 billion and $9.4 billion as of December 31, 2021 and 2020, respectively, which exceeded aggregate minimum regulatory requirements of $7.6 billion and $7.0 billion, respectively. The amount of ordinary dividends that may be paid to our parent company in 2022 is approximately $1.5 billion in the aggregate. The amount, timing and mix of ordinary and extraordinary dividend payments will vary due to state regulatory requirements, the level of excess statutory capital and surplus and expected future surplus requirements related to, for example, premium volume and product mix. Actual dividends that were paid to our parent company were approximately $1.6 billion in 2021, $1.3 billion in 2020, and $1.8 billion in 2019. |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2021 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS For the Years Ended December 31, 2021, 2020, and 2019 (in millions) Additions Balance at Charged Charged to Deductions Balance at Allowance for loss on receivables: 2021 $ 72 $ 21 $ (3) $ (7) $ 83 2020 69 36 (1) (32) 72 2019 79 (1) — (9) 69 Deferred tax asset valuation allowance: 2021 (37) (28) — — (65) 2020 (45) 8 — — (37) 2019 (54) 9 — — (45) (1) Represents changes in retroactive membership adjustments to premiums revenue and contractual allowances adjustments to services revenue as more fully described in Note 2 to the consolidated financial statements included in this annual report on Form 10-K. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation Our financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America. Our consolidated financial statements include the accounts of Humana Inc. and subsidiaries that the Company controls, including variable interest entities associated with medical practices for which we are the primary beneficiary. We do not own many of our medical practices but instead enter into exclusive management agreements with the affiliated Professional Associations, or P.A.s, that operate these medical practices. Based upon the provisions of these agreements, these affiliated P.A.s are variable interest entities and we are the primary beneficiary, and accordingly we consolidate the affiliated P.A.s. All significant intercompany balances and transactions have been eliminated. The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The areas involving the most significant use of estimates are the estimation of benefits payable, the impact of risk adjustment provisions related to our Medicare contracts, the valuation and related impairment recognition of investment securities, and the valuation and related impairment recognition of long-lived assets, including goodwill and indefinite-lived intangible assets. These estimates are based on knowledge of current events and anticipated future events, and accordingly, actual results may ultimately differ materially from those estimates. |
Health Care Reform | Health Care Reform The Patient Protection and Affordable Care Act and The Health Care and Education Reconciliation Act of 2010 (which we collectively refer to as the Health Care Reform Law) enacted significant reforms to various aspects of the U.S. health insurance industry. Certain of these reforms became effective January 1, 2014, including an annual insurance industry premium-based fee. The Continuing Resolution bill, H.R. 195, enacted on January 22, 2018, included a one year suspension in 2019 of the health insurance industry fee, but the fee resumed in calendar year 2020. The Further Consolidated Appropriations Act, 2020, enacted on December 20, 2019, permanently repealed the health insurance industry fee beginning in calendar year 2021. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash, time deposits, money market funds, commercial paper, other money market instruments, and certain U.S. Government securities with an original maturity of three months or less. Carrying value approximates fair value due to the short-term maturity of the investments. |
Investment Securities | Investment Securities Investment securities, which consist of debt and equity securities, are stated at fair value. Our debt securities have been categorized as available for sale. Debt securities available for current operations are classified as current assets and debt securities available to fund our professional and other self-insurance liability requirements, as well as restricted statutory deposits and equity securities, are classified as long-term assets. For the purpose of determining realized gross gains and losses for debt securities sold, which are included as a component of investment income in the consolidated statements of income, the cost of investment securities sold is based upon specific identification. Unrealized holding gains and losses for debt securities, net of applicable deferred taxes, are included as a component of stockholders’ equity and comprehensive income until realized from a sale or an expected credit loss is recognized. For the purpose of determining gross gains and losses for equity securities, changes in fair value at the reporting date are included as a component of investment income in the consolidated statements of income. Prior to January 1, 2020, we applied the other-than-temporary impairment model for securities in an unrealized loss position which did not result in any material impairments for 2019. Beginning on January 1, 2020, we adopted the new current expected credit losses, or CECL, model which retained many similarities from the previous other-than-temporary impairment model except eliminating from consideration in the impairment analysis the length of time over which the fair value had been less than cost. Also, under the CECL model, expected losses on available for sale debt securities are recognized through an allowance for credit losses rather than as reductions in the amortized cost of the securities. For debt securities whose fair value is less than their amortized cost which we do not intend to sell or are not required to sell, we evaluate the expected cash flows to be received as compared to amortized cost and determine if an expected credit loss has occurred. In the event of an expected credit loss, only the amount of the impairment associated with the expected credit loss is recognized in income with the remainder, if any, of the loss recognized in other comprehensive income. To the extent we have the intent to sell the debt security or it is more likely than not we will be required to sell the debt security before recovery of our amortized cost basis, we recognize an impairment loss in income in an amount equal to the full difference between the amortized cost basis and the fair value. Potential expected credit loss impairment is considered using a variety of factors, including the extent to which the fair value has been less than cost; adverse conditions specifically related to the industry, geographic area or financial condition of the issuer or underlying collateral of a debt security; changes in the quality of the debt security's credit enhancement; payment structure of the debt security; changes in credit rating of the debt security by the rating agencies; failure of the issuer to make scheduled principal or interest payments on the debt security and changes in prepayment speeds. For debt securities, we take into account expectations of relevant market and economic data. For example, with respect to mortgage and asset-backed securities, such data includes underlying loan level data and structural features such as seniority and other forms of credit enhancements. We estimate the amount of the expected credit loss component of a debt security as the difference between the amortized cost and the present value of the expected cash flows of the security. The present value is determined using the best estimate of future cash flows discounted at the implicit interest rate at the date of purchase. The expected credit loss cannot exceed the full difference between the amortized cost basis and the fair value. |
Premiums Revenue | Premiums Revenue We receive monthly premiums from the federal government and various states according to government specified payment rates and various contractual terms. We bill and collect premium from employer groups and members in our Medicare and other individual products monthly. Changes in premium revenues resulting from the periodic changes in risk-adjustment scores derived from medical diagnoses for our membership are estimated by projecting the ultimate annual premium and are recognized ratably during the year, with adjustments each period to reflect changes in the ultimate premium. Receivables or payables are classified as current or long-term in our consolidated balance sheet based on the timing of the expected settlement. Premiums revenue is estimated by multiplying the membership covered under the various contracts by the contractual rates. Premiums revenue is recognized as income in the period members are entitled to receive services, and is net of estimated uncollectible amounts, retroactive membership adjustments, and adjustments to recognize rebates under the minimum benefit ratios required under the Health Care Reform Law. We estimate policyholder rebates by projecting calendar year minimum benefit ratios for the small group and large group markets, as defined by the Health Care Reform Law using a methodology prescribed by Health and Human Services, or HHS, separately by state and legal entity. Medicare Advantage and Medicaid products are also subject to minimum benefit ratio requirements. Estimated calendar year rebates recognized ratably during the year are revised each period to reflect current experience. Retroactive membership adjustments result from enrollment changes not yet processed, or not yet reported by an employer group or the government. We routinely monitor the collectability of specific accounts, the aging of receivables, historical retroactivity trends, estimated rebates, as well as prevailing and anticipated economic conditions, and reflect any required adjustments in current operations. Premiums received prior to the service period are recorded as unearned revenues. Medicare Part D We cover prescription drug benefits in accordance with Medicare Part D under multiple contracts with CMS. The payments we receive monthly from CMS and members, which are determined from our annual bid, represent amounts for providing prescription drug insurance coverage. We recognize premiums revenue for providing this insurance coverage ratably over the term of our annual contract. Our CMS payment is subject to risk sharing through the Medicare Part D risk corridor provisions. In addition, receipts for reinsurance and low-income cost subsidies as well as receipts for certain discounts on brand name prescription drugs in the coverage gap represent payments for prescription drug costs for which we are not at risk. The risk corridor provisions compare costs targeted in our bids to actual prescription drug costs, limited to actual costs that would have been incurred under the standard coverage as defined by CMS. Variances exceeding certain thresholds may result in CMS making additional payments to us or require us to refund to CMS a portion of the premiums we received. As risk corridor provisions are considered in our overall annual bid process, we estimate and recognize an adjustment to premiums revenue related to these provisions based upon pharmacy claims experience. We record a receivable or payable at the contract level and classify the amount as current or long-term in our consolidated balance sheets based on the timing of expected settlement. Reinsurance and low-income cost subsidies represent funding from CMS in connection with the Medicare Part D program for which we assume no risk. Reinsurance subsidies represent funding from CMS for its portion of prescription drug costs which exceed the member’s out-of-pocket threshold, or the catastrophic coverage level. Low-income cost subsidies represent funding from CMS for all or a portion of the deductible, the coinsurance and co-payment amounts above the out-of-pocket threshold for low-income beneficiaries. Monthly prospective payments from CMS for reinsurance and low-income cost subsidies are based on assumptions submitted with our annual bid. A reconciliation and related settlement of CMS’s prospective subsidies against actual prescription drug costs we paid is made after the end of the year. The Health Care Reform Law mandates consumer discounts of 50% on brand name prescription drugs for Part D plan participants in the coverage gap. These discounts are funded by CMS and pharmaceutical manufacturers while we administer the application of these funds. We account for these subsidies and discounts as a deposit in our consolidated balance sheets and as a financing activity under receipts (withdrawals) from contract deposits in our consolidated statements of cash flows. 2021 2020 2019 (in millions) Part D subsidy/discount payments $ (14,889) $ (13,348) $ (11,762) Part D subsidy/discount reimbursements 14,628 12,410 11,202 Net payments $ (261) $ (938) $ (560) We do not recognize premiums revenue or benefit expenses for these subsidies or discounts. Receipt and payment activity is accumulated at the contract level and recorded in our consolidated balance sheets in other current assets or trade accounts payable and accrued expenses depending on the contract balance at the end of the reporting period. Settlement of the reinsurance and low-income cost subsidies as well as the risk corridor payment is based on a reconciliation made approximately 9 months after the close of each calendar year. Settlement with CMS for brand name prescription drug discounts is based on a reconciliation made approximately 14 to 18 months after the close of each calendar year. We continue to revise our estimates with respect to the risk corridor provisions based on subsequent period pharmacy claims data. See Note 7 for detail regarding amounts recorded to our consolidated balance sheets related to the risk corridor settlement and subsidies from CMS with respect to the Medicare Part D program. |
Services Revenue | Services Revenue Patient services revenue Patient services include services related to pharmacy solutions, provider services, and home solutions services, such as home health and other services and capabilities to promote wellness and advance population health. Patient services revenues are reported in the amount reflecting the ultimate consideration we expect to receive, primarily from government programs (Medicare and Medicaid), net of contractual allowances, discounts, or other implicit price concessions. We estimate the transaction price utilizing contractual rates, historical experience and current conditions. Patient services revenues are recognized as performance obligations are satisfied, which is in the period services are rendered. For the year ended December 31, 2021, revenue recognized from performance obligations related to prior periods (for example, due to changes in transaction price), was not material. Further, revenue expected to be recognized in any future year related to remaining performance obligations was not material. Administrative services fees Administrative services fees cover the processing of claims, offering access to our provider networks and clinical programs, and responding to customer service inquiries from members of self-funded groups. Revenues from providing administration services, also known as administrative services only, or ASO, are recognized in the period services are performed and are net of estimated uncollectible amounts. ASO fees are estimated by multiplying the membership covered under the various contracts by the contractual rates. Under ASO contracts, self-funded employers retain the risk of financing substantially all of the cost of health benefits. However, many ASO customers purchase stop loss insurance coverage from us to cover catastrophic claims or to limit aggregate annual costs. Accordingly, we have recorded premiums revenue and benefits expense related to these stop loss insurance contracts. We routinely monitor the collectability of specific accounts, the aging of receivables, as well as prevailing and anticipated economic conditions, and reflect any required adjustments in current operations. ASO fees received prior to the service period are recorded as unearned revenues. Under our TRICARE contracts with the Department of Defense (DoD) we provide administrative services, including offering access to our provider networks and clinical programs, claim processing, customer service, enrollment, and other services, while the federal government retains all of the risk of the cost of health benefits. We account for revenues under our contracts net of estimated health care costs similar to an administrative services fee only agreement. Our contracts include fixed administrative services fees and incentive fees and penalties. Administrative services fees are recognized as services are performed. Our TRICARE members are served by both in-network and out-of-network providers in accordance with our contracts. We pay health care costs related to these services to the providers and are subsequently reimbursed by the DoD for such payments. We account for the payments of the federal government’s claims and the related reimbursements under deposit accounting in our consolidated balance sheets and as a financing activity under receipts (withdrawals) from contract deposits in our consolidated statements of cash flows. 2021 2020 2019 (in millions) Health care cost payments $ (6,943) $ (6,253) $ (6,475) Health care cost reimbursements 6,898 6,252 6,412 Net payments $ (45) $ (1) $ (63) |
Receivables | Receivables Receivables, including premium receivables, patient services revenue receivables, and ASO fee receivables, are shown net of allowances for estimated uncollectible accounts, retroactive membership adjustments, and contractual allowances. |
Other Current Assets | Other Current AssetsOther current assets include amounts associated with Medicare Part D as discussed above and in Note 7, rebates due from pharmaceutical manufacturers and other amounts due within one year. We accrue pharmaceutical rebates as they are earned based on contractual terms and usage of the product. |
Policy Acquisition Costs | Policy Acquisition Costs Policy acquisition costs are those costs that relate directly to the successful acquisition of new and renewal insurance policies. Such costs include commissions, costs of policy issuance and underwriting, and other costs we incur to acquire new business or renew existing business. We expense policy acquisition costs related to our employer-group prepaid health services policies as incurred. These short-duration employer-group prepaid health services policies typically have a 1-year term and may be canceled upon 30 days notice by the employer group. |
Long-Lived Assets | Long-Lived Assets Property and equipment is recorded at cost. Gains and losses on sales or disposals of property and equipment are included in operating costs. Certain costs related to the development or purchase of internal-use software are capitalized. Depreciation is computed using the straight-line method over estimated useful lives ranging from 3 to 10 years for equipment, 3 to 5 years for computer software, and 10 to 20 years for buildings. Improvements to leased facilities are depreciated over the shorter of the remaining lease term or the anticipated life of the improvement. We periodically review long-lived assets, including property and equipment and definite-lived intangible assets, for impairment whenever adverse events or changes in circumstances indicate the carrying value of the asset may not be recoverable. Losses are recognized for a long-lived asset to be held and used in our operations when the undiscounted future cash flows expected to result from the use of the asset are less than its carrying value. We recognize an impairment loss based on the excess of the carrying value over the fair value of the asset. A long-lived asset held for sale is reported at the lower of the carrying amount or fair value less costs to sell. Depreciation expense is not recognized on assets held for sale. Losses are recognized for a long-lived asset to be abandoned when the asset ceases to be used. In addition, we periodically review the estimated lives of all long-lived assets for reasonableness. |
Equity Method Investments | Equity Method Investments We use the equity method of accounting for equity investments in companies where we are able to exercise significant influence, but not control, over operating and financial policies of the investee. Judgment regarding the level of influence over each equity method investment includes considering key factors such as our ownership interest, representation on the board of directors, organizational structure, participation in policy-making decisions and material intra-entity transactions. Generally, under the equity method, original investments in these entities are recorded at cost and subsequently adjusted by our share of equity in income or losses after the date of acquisition as well as capital contributions to and distributions from these companies. Our proportionate share of the net income or loss of these companies is included in consolidated net income. Investment amounts in excess of our share of an investee’s net assets are amortized over the life of the related asset creating the excess. Excess goodwill is not amortized. We evaluate equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment might not be recoverable. Factors considered by us when reviewing an equity method investment for impairment include the length of time (duration) and the extent (severity) to which the fair value of the equity method investment has been less than carrying value, the investee’s financial condition and near-term prospects and the intent and ability to hold the investment for a period of time sufficient to allow for anticipated recovery. An impairment that is other-than-temporary is recognized in the period identified. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill represents the unamortized excess of cost over the fair value of the net tangible and other intangible assets acquired. We are required to test at least annually for impairment at a level of reporting referred to as the reporting unit, and more frequently if adverse events or changes in circumstances indicate that the asset may be impaired. A reporting unit either is our operating segments or one level below the operating segments, referred to as a component, which comprise our reportable segments. A component is considered a reporting unit if the component constitutes a business for which discrete financial information is available that is regularly reviewed by management. We aggregate the components of an operating segment into one reporting unit if they have similar economic characteristics. Goodwill is assigned to the reporting units that are expected to benefit from the specific synergies of the business combination. We perform a quantitative assessment to review goodwill for impairment to determine both the existence and amount of goodwill impairment, if any. Impairment tests are performed, at a minimum, in the fourth quarter of each year supported by our long-range business plan and annual planning process. We rely on an evaluation of future discounted cash flows to determine fair value of our reporting units. The fair value of our reporting units with significant goodwill exceeded carrying amounts by a substantial margin. However, unfavorable changes in key assumptions or combinations of assumptions including a significant increase in the discount rate, decrease in the long-term growth rate or substantial reduction in our underlying cash flow assumptions, including revenue growth rates, medical and operating cost trends, and projected operating income could have a significant negative impact on the estimated fair value of our home solutions and provider reporting units, which accounted for $6.6 billion and $0.9 billion of goodwill, respectively. Impairment tests completed for 2021, 2020, and 2019 did not result in an impairment loss. Indefinite-lived intangible assets relate to Certificate of Needs (CON) and Medicare licenses acquired as part of our acquisition of Kindred at Home, or KAH, and are included within other long-term assets in the consolidated balance sheet at December 31, 2021. See Note 3 for further information. We are required to annually compare the fair values of other indefinite-lived intangible assets to their carrying amounts. If the carrying amount of an indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized. Fair values of indefinite-lived intangible assets are determined based on the income approach. Impairment tests completed for 2021 did not result in an impairment loss. Definite-lived intangible assets primarily relate to acquired customer contracts/relationships and are included with other long-term assets in the consolidated balance sheets. Definite-lived intangible assets are amortized over the useful life generally using the straight-line method. We review definite-lived intangible assets for impairment under our long-lived asset policy. |
Benefits Payable and Benefits Expense Recognition | Benefits Payable and Benefits Expense Recognition Benefits expense includes claim payments, capitation payments, pharmacy costs net of rebates, allocations of certain centralized expenses and various other costs incurred to provide health insurance coverage to members, as well as estimates of future payments to hospitals and others for medical care and other supplemental benefits provided on or prior to the balance sheet date. Capitation payments represent monthly contractual fees disbursed to primary care and other providers who are responsible for providing medical care to members. Pharmacy costs represent payments for members’ prescription drug benefits, net of rebates from drug manufacturers. Receivables for such pharmacy rebates are included in other current assets in our consolidated balance sheets. Other supplemental benefits include dental, vision, and other supplemental health products. We estimate the costs of our benefits expense payments using actuarial methods and assumptions based upon claim payment patterns, medical cost inflation, historical developments such as claim inventory levels and claim receipt patterns, and other relevant factors, and record benefit reserves for future payments. We continually review estimates of future payments relating to claims costs for services incurred in the current and prior periods and make necessary adjustments to our reserves. Benefits expense is recognized in the period in which services are provided and includes an estimate of the cost of services which have been incurred but not yet reported, or IBNR. Our reserving practice is to consistently recognize the actuarial best point estimate within a level of confidence required by actuarial standards. Actuarial standards of practice generally require a level of confidence such that the liabilities established for IBNR have a greater probability of being adequate versus being insufficient, or such that the liabilities established for IBNR are sufficient to cover obligations under an assumption of moderately adverse conditions. Adverse conditions are situations in which the actual claims are expected to be higher than the otherwise estimated value of such claims at the time of the estimate. Therefore, in many situations, the claim amounts ultimately settled will be less than the estimate that satisfies the actuarial standards of practice. We develop our estimate for IBNR using actuarial methodologies and assumptions, primarily based upon historical claim experience. Depending on the period for which incurred claims are estimated, we apply a different method in determining our estimate. For periods prior to the most recent two months, a completion factor method uses historical paid claims patterns to estimate the percentage of claims incurred during a given period that have historically been adjudicated as of the reporting period. Changes in claim inventory levels and known changes in claim payment processes are taken into account in these estimates. For the most recent two months, the incurred claims are estimated primarily from a trend analysis based upon per member per month claims trends developed from our historical experience in the preceding months, adjusted for known changes in estimates of hospital admissions, recent hospital and drug utilization data, provider contracting changes, changes in benefit levels, changes in member cost sharing, changes in medical management processes, product mix, and workday seasonality. The completion factor method is used for the months of incurred claims prior to the most recent two months because the historical percentage of claims processed for those months is at a level sufficient to produce a consistently reliable result. Conversely, for the most recent two months of incurred claims, the volume of claims processed historically is not at a level sufficient to produce a reliable result, which therefore requires us to examine historical trend patterns as the primary method of evaluation. Changes in claim processes, including recoveries of overpayments, receipt cycle times, claim inventory levels, outsourcing, system conversions, and processing disruptions due to weather or other events affect views regarding the reasonable choice of completion factors. Claim payments to providers for services rendered are often net of overpayment recoveries for claims paid previously, as contractually allowed. Claim overpayment recoveries can result from many different factors, including retroactive enrollment activity, audits of provider billings, and/or payment errors. Changes in patterns of claim overpayment recoveries can be unpredictable and result in completion factor volatility, as they often impact older dates of service. The receipt cycle time measures the average length of time between when a medical claim was initially incurred and when the claim form was received. Increases in electronic claim submissions from providers decrease the receipt cycle time. If claims are submitted or processed on a faster (slower) pace than prior periods, the actual claim may be more (less) complete than originally estimated using our completion factors, which may result in reserves that are higher (lower) than required. Medical cost trends potentially are more volatile than other segments of the economy. The drivers of medical cost trends include increases in the utilization of hospital facilities, physician services, new higher priced technologies and medical procedures, and new prescription drugs and therapies, as well as the inflationary effect on the cost per unit of each of these expense components. Other external factors such as government-mandated benefits or other regulatory changes, the tort liability system, increases in medical services capacity, direct to consumer advertising for prescription drugs and medical services, an aging population, lifestyle changes including diet and smoking, catastrophes, public health emergencies, epidemics and pandemics (such as the spread of COVID-19) also may impact medical cost trends. Internal factors such as system conversions, claims processing cycle times, changes in medical management practices and changes in provider contracts also may impact our ability to accurately predict estimates of historical completion factors or medical cost trends. All of these factors are considered in estimating IBNR and in estimating the per member per month claims trend for purposes of determining the reserve for the most recent two months. Additionally, we continually prepare and review follow-up studies to assess the reasonableness of the estimates generated by our process and methods over time. The results of these studies are also considered in determining the reserve for the most recent two months. Each of these factors requires significant judgment by management. We reassess the profitability of our contracts for providing insurance coverage to our members when current operating results or forecasts indicate probable future losses. We establish a premium deficiency reserve in current operations to the extent that the sum of expected future costs, claim adjustment expenses, and maintenance costs exceeds related future premiums under contracts without consideration of investment income. For purposes of determining premium deficiencies, contracts are grouped in a manner consistent with our method of acquiring, servicing, and measuring the profitability of such contracts. Losses recognized as a premium deficiency result in a beneficial effect in subsequent periods as operating losses under these contracts are charged to the liability previously established. Because the majority of our member contracts renew annually, we would not record a material premium deficiency reserve, except when unanticipated adverse events or changes in circumstances indicate otherwise. We believe our benefits payable are adequate to cover future claims payments required. However, such estimates are based on knowledge of current events and anticipated future events. Therefore, the actual liability could differ materially from the amounts provided. |
Future policy benefits payable | Future policy benefits payable Future policy benefits payable includes liabilities for long-duration insurance policies primarily related to certain blocks of insurance assumed in acquisitions, primarily life and annuities in run-off status, and are included in our consolidated balance sheet within other long-term liabilities. Most of these policies are subject to reinsurance as detailed in Note 19. |
Book Overdraft | Book Overdraft Under our cash management system, checks issued but not yet presented to banks that would result in negative bank balances when presented are classified as a current liability in the consolidated balance sheets. Changes in book overdrafts from period to period are reported in the consolidated statement of cash flows as a financing activity. |
Income Taxes | Income Taxes We recognize an asset or liability for the deferred tax consequences of temporary differences between the tax bases of assets or liabilities and their reported amounts in the consolidated financial statements. These temporary differences will result in taxable or deductible amounts in future years when the reported amounts of the assets or liabilities are recovered or settled. We also recognize the future tax benefits such as net operating and capital loss carryforwards as deferred tax assets. A valuation allowance is provided against these deferred tax assets if it is more likely than not that some portion or all of the deferred tax assets will not be realized. Future years’ tax expense may be increased or decreased by adjustments to the valuation allowance or to the estimated accrual for income taxes. Deferred tax assets and deferred tax liabilities are further adjusted for changes in the enacted tax rates. We record tax benefits when it is more likely than not that the tax return position taken with respect to a particular transaction will be sustained. A liability, if recorded, is not considered resolved until the statute of limitations for the relevant taxing authority to examine and challenge the tax position has expired, or the tax position is ultimately settled through examination, negotiation, or litigation. We classify interest and penalties associated with uncertain tax positions in our provision for income taxes. |
Noncontrolling Interests | Noncontrolling Interests The consolidated financial statements include all assets, liabilities, revenues and expenses of less than 100% owned affiliates that we control. Accordingly, we record noncontrolling interests in the earnings and equity of such entities. We record adjustments to noncontrolling interests for the allocable portion of income or loss to which the noncontrolling interest holders are entitled based upon their portion of the subsidiaries they own. Distributions to holders of noncontrolling interests are adjusted to the respective noncontrolling interest holders’ balances. Noncontrolling interests, which relate to the minority ownership held by third party investors in certain of our Home Solutions business, are reported below net income under the heading “Net income attributable to noncontrolling interests” in the consolidated statements of income and presented as a component of equity in the consolidated balance sheets. |
Stock-Based Compensation | Stock-Based CompensationWe generally recognize stock-based compensation expense, as determined on the date of grant at fair value, on a straight-line basis over the period during which an employee is required to provide service in exchange for the award (the vesting period). In addition, for awards with both time and performance-based conditions, we generally recognize compensation expense on a straight line basis over the vesting period when it is probable that the performance condition will be achieved. We estimate expected forfeitures and recognize compensation expense only for those awards which are expected to vest. We estimate the grant-date fair value of stock options using the Black-Scholes option-pricing model. |
Earnings Per Common Share | Earnings Per Common Share We compute basic earnings per common share on the basis of the weighted-average number of unrestricted common shares outstanding. Diluted earnings per common share is computed on the basis of the weighted-average number of unrestricted common shares outstanding plus the dilutive effect of outstanding employee stock options and restricted shares, or units, using the treasury stock method. |
Fair Value | Fair Value Assets and liabilities measured at fair value are categorized into a fair value hierarchy based on whether the inputs to valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our own assumptions about the assumptions market participants would use. The fair value hierarchy includes three levels of inputs that may be used to measure fair value as described below. Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include securities that are traded in an active exchange market. Level 2 – Observable inputs other than Level 1 prices such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments as well as debt securities whose value is determined using a pricing model with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. Level 3 – Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Level 3 includes assets and liabilities whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques reflecting our own assumptions about the assumptions market participants would use as well as those requiring significant management judgment. Fair value of actively traded debt and equity securities are based on quoted market prices. Fair value of other debt securities are based on quoted market prices of identical or similar securities or based on observable inputs like interest rates generally using a market valuation approach, or, less frequently, an income valuation approach and are generally classified as Level 2. Fair value of privately held investment grade debt securities are estimated using a variety of valuation methodologies, including both market and income approaches, where an observable quoted market does not exist and are generally classified as Level 3. For privately-held investment grade debt securities, such methodologies include reviewing the value ascribed to the most recent financing, comparing the security with securities of publicly-traded companies in similar lines of business with similar credit characteristics, and reviewing the underlying financial performance including estimating discounted cash flows. We obtain at least one price for each security from a third party pricing service. These prices are generally derived from recently reported trades for identical or similar securities, including adjustments through the reporting date based upon observable market information. When quoted prices are not available, the third party pricing service may use quoted market prices of comparable securities or discounted cash flow analysis, incorporating inputs that are currently observable in the markets for similar securities. Inputs that are often used in the valuation methodologies include benchmark yields, reported trades, credit spreads, broker quotes, default rates, and prepayment speeds. We are responsible for the determination of fair value and as such we perform analysis on the prices received from the third party pricing service to determine whether the prices are reasonable estimates of fair value. Our analysis includes a review of monthly price fluctuations as well as a quarterly comparison of the prices received from the pricing service to prices reported by our third party investment adviser. In addition, on a quarterly basis we examine the underlying inputs and assumptions for a sample of individual securities across asset classes, credit rating levels, and various durations. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Accounting Pronouncements Effective in Future Periods In September 2018, the FASB issued new guidance related to accounting for long-duration contracts of insurers which revises key elements of the measurement models and disclosure requirements for long-duration contracts issued by insurers, including the amortization of deferred contract acquisition costs and the measurement of liabilities for future policy benefits using current, rather than locked-in, assumptions. The new guidance, limited to our Medicare supplement product which represent less than 1% of consolidated premiums and services revenue, is effective for us beginning with annual and interim periods in 2023 and is to be applied to contracts in force at the beginning of the earliest period presented, with an option to apply retrospectively with a cumulative effect adjustment to the opening balances of retained earnings as of the earliest period presented. We are currently evaluating the impact on our results of operations, financial position and cash flows. There are no other recently issued accounting standards that apply to us or that are expected to have a material impact on our results of operations, financial condition, or cash flows. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Health Care Cost Payments and Reimbursements | We account for these subsidies and discounts as a deposit in our consolidated balance sheets and as a financing activity under receipts (withdrawals) from contract deposits in our consolidated statements of cash flows. 2021 2020 2019 (in millions) Part D subsidy/discount payments $ (14,889) $ (13,348) $ (11,762) Part D subsidy/discount reimbursements 14,628 12,410 11,202 Net payments $ (261) $ (938) $ (560) 2021 2020 2019 (in millions) Health care cost payments $ (6,943) $ (6,253) $ (6,475) Health care cost reimbursements 6,898 6,252 6,412 Net payments $ (45) $ (1) $ (63) |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The preliminary fair values of KAH’s assets acquired and liabilities assumed at the date of the acquisition are summarized as follows: Kindred at Home (in millions) Cash and cash equivalents $ 278 Receivables 381 Other current assets 61 Property and equipment 74 Goodwill 5,771 Other intangible assets 2,312 Other long-term assets 172 Total assets acquired $ 9,049 Current liabilities $ 410 Long term debt 2,078 Other long-term liabilities 369 Total liabilities assumed $ 2,857 Noncontrolling interests 22 Net assets acquired $ 6,170 |
EQUITY METHOD INVESTMENT (Table
EQUITY METHOD INVESTMENT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Method Investments | The summarized balance sheet at December 31, 2020 and statements of income at December 31, 2020 and 2019 of KAH were as follows: Balance sheet December 31, 2020 (in millions) Current assets $ 844 Non-current assets 4,858 Current liabilities 556 Non-current liabilities 2,445 Shareholders' equity 2,700 Statements of income For the year ended December 31, 2020 For the year ended December 31, 2019 (in millions) Revenues $ 2,972 $ 3,100 Expenses 2,552 2,835 Net income 207 54 |
INVESTMENT SECURITIES (Tables)
INVESTMENT SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Investment Securities Classified as Current and Long-Term | Investment securities classified as current and long-term were as follows at December 31, 2021 and 2020, respectively: Amortized Gross Gross Fair (in millions) December 31, 2021 U.S. Treasury and other U.S. government U.S. Treasury and agency obligations $ 611 $ 1 $ (10) $ 602 Mortgage-backed securities 3,265 33 (69) 3,229 Tax-exempt municipal securities 810 33 (2) 841 Mortgage-backed securities: Residential 373 — (6) 367 Commercial 1,394 27 (11) 1,410 Asset-backed securities 1,346 6 (4) 1,348 Corporate debt securities 5,641 118 (59) 5,700 Total debt securities $ 13,440 $ 218 $ (161) 13,497 Common stock 475 Total investment securities $ 13,972 December 31, 2020 U.S. Treasury and other U.S. government U.S. Treasury and agency obligations $ 616 $ 1 $ (1) $ 616 Mortgage-backed securities 3,115 140 (1) 3,254 Tax-exempt municipal securities 1,393 54 — 1,447 Mortgage-backed securities: Residential 17 — — 17 Commercial 1,260 59 (1) 1,318 Asset-backed securities 1,364 10 (2) 1,372 Corporate debt securities 4,672 256 (1) 4,927 Total debt securities $ 12,437 $ 520 $ (6) 12,951 Common stock 815 Total investment securities $ 13,766 |
Schedule of Gross Unrealized Losses and Fair Value of Securities | Gross unrealized losses and fair values aggregated by investment category and length of time that individual debt securities have been in a continuous unrealized loss position were as follows at December 31, 2021 and 2020, respectively: Less than 12 months 12 months or more Total Fair Gross Fair Gross Fair Gross (in millions) December 31, 2021 U.S. Treasury and other U.S. government U.S. Treasury and agency obligations $ 201 $ (3) $ 355 $ (7) $ 556 $ (10) Mortgage-backed securities 2,082 (49) 556 (20) 2,638 (69) Tax-exempt municipal securities 68 (1) 34 (1) 102 (2) Mortgage-backed securities: Residential 358 (6) 8 — 366 (6) Commercial 295 (4) 400 (7) 695 (11) Asset-backed securities 530 (3) 425 (1) 955 (4) Corporate debt securities 1,456 (28) 769 (31) 2,225 (59) Total debt securities $ 4,990 $ (94) $ 2,547 $ (67) $ 7,537 $ (161) December 31, 2020 U.S. Treasury and other U.S. government U.S. Treasury and agency obligations $ 225 $ (1) $ — $ — $ 225 $ (1) Mortgage-backed securities 199 (1) — — 199 (1) Tax-exempt municipal securities 16 — 19 — 35 — Mortgage-backed securities: Residential 17 — — — 17 — Commercial 193 (1) 43 — 236 (1) Asset-backed securities 65 — 498 (2) 563 (2) Corporate debt securities 342 (1) 16 — 358 (1) Total debt securities $ 1,057 $ (4) $ 576 $ (2) $ 1,633 $ (6) |
Schedule of Realized Gains (Losses) Related to Investment Securities Included Within Investment Income | The detail of realized gains (losses) related to investment securities and included within investment income was as follows for the years ended December 31, 2021, 2020, and 2019: 2021 2020 2019 (in millions) Gross gains on investment securities $ 219 $ 110 $ 129 Gross losses on investment securities (8) (18) (67) Gross gains on equity securities 23 746 — Gross losses on equity securities (364) — — Net recognized (losses) gains on investment securities $ (130) $ 838 $ 62 |
Gain (Loss) on Equity Securities | The gains and losses related to equity securities for the years ended December 31, 2021 and 2020 was as follows: 2021 2020 (in millions) Net (losses) gains recognized on equity securities during the period $ (341) $ 746 Less: Net losses recognized on equity securities sold during the period (13) — Unrealized (losses) gains recognized on equity securities still held at the end of the period $ (328) $ 746 |
Schedule of Contractual Maturities of Debt Securities Available for Sale | The contractual maturities of debt securities available for sale at December 31, 2021, regardless of their balance sheet classification, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Fair (in millions) Due within one year $ 459 $ 461 Due after one year through five years 2,200 2,251 Due after five years through ten years 3,043 3,057 Due after ten years 1,360 1,374 Mortgage and asset-backed securities 6,378 6,354 Total debt securities $ 13,440 $ 13,497 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets Measured at Fair Value on Recurring Basis | The following table summarizes our fair value measurements at December 31, 2021 and 2020, respectively, for financial assets measured at fair value on a recurring basis: Fair Value Measurements Using Fair Value Quoted Prices Other Unobservable (in millions) December 31, 2021 Cash equivalents $ 3,322 $ 3,322 $ — $ — Debt securities: U.S. Treasury and other U.S. government corporations and agencies: U.S. Treasury and agency obligations 602 — 602 — Mortgage-backed securities 3,229 — 3,229 — Tax-exempt municipal securities 841 — 841 — Mortgage-backed securities: Residential 367 — 367 — Commercial 1,410 — 1,410 — Asset-backed securities 1,348 — 1,348 — Corporate debt securities 5,700 — 5,632 68 Total debt securities 13,497 — 13,429 68 Common stock 475 475 — — Total invested assets $ 17,294 $ 3,797 $ 13,429 $ 68 December 31, 2020 Cash equivalents $ 4,548 $ 4,548 $ — $ — Debt securities: U.S. Treasury and other U.S. government corporations and agencies: U.S. Treasury and agency obligations 616 — 616 — Mortgage-backed securities 3,254 — 3,254 — Tax-exempt municipal securities 1,447 — 1,447 — Mortgage-backed securities: Residential 17 — 17 — Commercial 1,318 — 1,318 — Asset-backed securities 1,372 — 1,372 — Corporate debt securities 4,927 — 4,927 — Total debt securities 12,951 — 12,951 — Common stock 815 815 — — Total invested assets $ 18,314 $ 5,363 $ 12,951 $ — |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | During the year ended December 31, 2021, the changes in the fair value of the assets measured using significant unobservable inputs (Level 3) were comprised of the following: For the year ended December 31, 2021 Private (in millions) Beginning balance at January 1 $ — Total gains or losses: Realized in earnings — Unrealized in other comprehensive income (1) Purchases 69 Sales — Settlements — Balance at December 31 $ 68 |
Schedule of Assumptions Used For Inputs In Fair Value Measurement | The table below presents the assumptions used for December 31, 2020. December 31, 2020 Annualized volatility 29.9 % Secured credit rate 0.4 % NOPAT 12.0 % Weighted average cost of capital 9.5 % Long term growth rate 3.0 % December 31, 2021 Annualized volatility 22.4 % Credit spread 0.9 % Revenue exit multiple 1.5x - 2.5x Weighted average cost of capital 12.5 % Long term growth rate 3.0 % |
MEDICARE PART D (Tables)
MEDICARE PART D (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Insurance [Abstract] | |
Schedule of Balance Sheet Amounts Associated With Medicare Part D | The accompanying consolidated balance sheets include the following amounts associated with Medicare Part D as of December 31, 2021 and 2020. CMS subsidies/discounts in the table below include the reinsurance and low-income cost subsidies funded by CMS for which we assume no risk as well as brand name prescription drug discounts for Part D plan participants in the coverage gap funded by CMS and pharmaceutical manufacturers. 2021 2020 Risk CMS Risk CMS (in millions) Other current assets $ 363 $ 1,894 $ 216 $ 1,420 Trade accounts payable and accrued expenses (68) (466) (39) (253) Net current asset 295 1,428 177 1,167 Other long-term assets 5 — 8 — Other long-term liabilities (194) — (90) — Net long-term liability (189) — (82) — Total net asset $ 106 $ 1,428 $ 95 $ 1,167 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment was comprised of the following at December 31, 2021 and 2020. 2021 2020 (in millions) Land $ 17 $ 19 Buildings and leasehold improvements 1,126 952 Equipment 1,148 1,009 Computer software 3,656 3,514 5,947 5,494 Accumulated depreciation (2,874) (3,123) Property and equipment, net $ 3,073 $ 2,371 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill By Reportable Segments | Changes in the carrying amount of goodwill for our reportable segments for the years ended December 31, 2021 and 2020 were as follows: Retail Group and Specialty Healthcare Services Total (in millions) Balance at January 1, 2020 $ 1,535 $ 261 $ 2,132 $ 3,928 Acquisitions — — 519 519 Balance at December 31, 2020 1,535 261 2,651 4,447 Acquisitions 398 — 6,247 6,645 Balance at December 31, 2021 $ 1,933 $ 261 $ 8,898 $ 11,092 |
Schedule of Intangible Assets Included in Other Long-Term Assets | The following table presents details of our other intangible assets included in other long-term assets in the accompanying consolidated balance sheets at December 31, 2021 and 2020. Weighted 2021 2020 Cost Accumulated Net Cost Accumulated Net (in millions) Other intangible assets: Certificates of need Indefinite $ 1,771 $ — $ 1,771 $ — $ — $ — Medicare licenses Indefinite 522 — 522 — — — Customer contracts/relationships 9.4 years 883 620 263 849 572 277 Trade names and technology 7.0 years 160 97 63 122 89 33 Provider contracts 11.6 years 72 57 15 69 50 19 Noncompetes and other 6.8 years 35 30 5 29 29 — Total other intangible assets 9.1 years $ 3,443 $ 804 $ 2,639 $ 1,069 $ 740 $ 329 |
Schedule of Estimate of Amortization Expense | The following table presents our estimate of amortization expense for each of the five next succeeding fiscal years: (in millions) 2022 $ 68 2023 53 2024 45 2025 43 2026 31 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Schedule of Maturity of Lease Liabilities | Maturity of Lease Liabilities December 31, 2021 For the years ended December 31, (in millions) 2022 $ 210 2023 170 2024 133 2025 105 2026 58 After 2026 129 Total lease payments 805 Less: Interest 74 Present value of lease liabilities $ 731 |
BENEFITS PAYABLE (Tables)
BENEFITS PAYABLE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Insurance [Abstract] | |
Schedule of Activity in Benefits Payable | On a consolidated basis, activity in benefits payable was as follows for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 (in millions) Balances at January 1 $ 8,143 $ 6,004 $ 4,862 Less: Reinsurance recoverables — (68) (95) Balances at January 1, net 8,143 5,936 4,767 Acquisitions 42 — — Incurred related to: Current year 70,024 61,941 54,193 Prior years (825) (313) (336) Total incurred 69,199 61,628 53,857 Paid related to: Current year (62,149) (54,003) (48,421) Prior years (6,946) (5,418) (4,267) Total paid (69,095) (59,421) (52,688) Reinsurance recoverable — — 68 Balances at December 31 $ 8,289 $ 8,143 $ 6,004 2021 2020 2019 (in millions) Balances at January 1 $ 7,428 $ 5,363 $ 4,338 Less: Reinsurance recoverables — (68) (95) Balances at January 1, net 7,428 5,295 4,243 Acquisitions 42 — — Incurred related to: Current year 65,636 56,821 48,983 Prior years (729) (266) (386) Total incurred 64,907 56,555 48,597 Paid related to: Current year (58,363) (49,586) (43,831) Prior years (6,339) (4,836) (3,714) Total paid (64,702) (54,422) (47,545) Reinsurance recoverable — — 68 Balances at December 31 $ 7,675 $ 7,428 $ 5,363 2021 2020 2019 (in millions) Balances at January 1 $ 715 $ 641 $ 517 Incurred related to: Current year 5,047 5,576 5,708 Prior years (96) (47) 50 Total incurred 4,951 5,529 5,758 Paid related to: Current year (4,445) (4,873) (5,081) Prior years (607) (582) (553) Total paid (5,052) (5,455) (5,634) Balances at December 31 $ 614 $ 715 $ 641 |
Schedule of Favorable Medical Claims Reserve Development Related to Prior Fiscal Years by Segment | The table below details our favorable medical claims reserve development related to prior fiscal years by segment for 2021, 2020, and 2019. (Favorable) Unfavorable Medical Claims Reserve 2021 2020 2019 (in millions) Retail Segment $ (729) $ (266) $ (386) Group and Specialty Segment (96) (47) 50 Total $ (825) $ (313) $ (336) |
Schedule of Incurred and Paid Claims Development | The following tables provide information about incurred and paid claims development for the Retail segment as of December 31, 2021, net of reinsurance. Incurred Claims, Net of Reinsurance For the Years Ended December 31, Claims Incurred Year 2019 2020 2021 (in millions) 2019 $ 48,983 $ 48,820 $ 48,713 2020 56,821 56,223 2021 65,678 Total $ 170,614 Cumulative Paid Claims, Net of Reinsurance For the Years Ended December 31, Claims Incurred Year 2019 2020 2021 (in millions) 2019 $ 43,831 $ 48,627 $ 48,713 2020 49,586 55,863 2021 58,363 Total 162,939 All outstanding benefit liabilities before 2019, net of reinsurance N/A Benefits payable, net of reinsurance $ 7,675 The following tables provide information about incurred and paid claims development for the Group and Specialty segment as of December 31, 2021, net of reinsurance. Incurred Claims, Net of Reinsurance For the Years Ended December 31, Claims Incurred Year 2019 2020 2021 (in millions) 2019 $ 5,708 $ 5,657 $ 5,652 2020 5,576 5,491 2021 5,047 Total $ 16,190 Cumulative Paid Claims, Net of Reinsurance For the Years Ended December 31, Claims Incurred Year 2019 2020 2021 (in millions) 2019 $ 5,081 $ 5,465 $ 5,652 2020 4,873 5,479 2021 4,445 Total 15,576 All outstanding benefit liabilities before 2019, net of reinsurance N/A Benefits payable, net of reinsurance $ 614 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Provision for Income Taxes | The provision for income taxes consisted of the following for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 (in millions) Current provision: Federal $ 466 $ 1,019 $ 560 States and Puerto Rico 4 93 41 Total current provision 470 1,112 601 Deferred expense 15 195 162 Provision for income taxes $ 485 $ 1,307 $ 763 |
Provision for Income Taxes Using Federal Statutory Rate | The provision for income taxes was different from the amount computed using the federal statutory rate for the years ended December 31, 2021, 2020 and 2019 due to the following: 2021 2020 2019 (in millions) Income tax provision at federal statutory rate $ 718 $ 982 $ 729 States, net of federal benefit, and Puerto Rico 18 63 49 Tax exempt investment income (3) (5) (6) Nondeductible executive compensation 33 19 25 Non-taxable KAH gain (264) — — Health insurance industry fee — 268 — Other, net (17) (20) (34) Provision for income taxes $ 485 $ 1,307 $ 763 |
Principal Components of Net Deferred Tax Balances | Principal components of our net deferred tax balances at December 31, 2021 and 2020 were as follows: Assets (Liabilities) 2021 2020 (in millions) Net operating loss carryforward $ 291 $ 32 Compensation and other accrued expense 186 171 Benefits payable 67 87 Deferred acquisition costs 33 26 Jobs tax credits 33 — Other 25 11 Unearned revenues 8 12 Total deferred income tax assets 643 339 Valuation allowance (65) (37) Total deferred income tax assets, net of valuation allowance 578 302 Depreciable property and intangible assets (1,072) (449) Prepaid expenses (102) (91) Investment securities (98) (418) Future policy benefits payable (4) (3) Total deferred income tax liabilities (1,276) (961) Total net deferred income tax liabilities $ (698) $ (659) |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Carrying Value of Debt Outstanding | The carrying value of debt outstanding was as follows at December 31, 2021 and 2020: 2021 2020 (in millions) Short-term debt: Commercial paper $ 955 $ 600 Senior notes: $600 million, 3.15% due December 1, 2022 599 — $400 million, 2.90% due December 15, 2022 399 — Total senior notes 998 — Total short-term debt $ 1,953 $ 600 Long-term debt: Senior notes: $600 million, 3.15% due December 1, 2022 — 598 $400 million, 2.90% due December 15, 2022 — 398 $1.5 billion, 0.65% due August 3, 2023 1,492 — $600 million, 3.85% due October 1, 2024 598 598 $600 million, 4.50% due April 1, 2025 596 595 $750 million, 1.35% due February 3, 2027 742 — $600 million, 3.95% due March 15, 2027 596 596 $500 million, 3.125% due August 15, 2029 496 495 $500 million, 4.875% due April 1, 2030 495 494 $750 million, 2.15% due February 3, 2032 741 — $250 million, 8.15% due June 15, 2038 261 262 $400 million, 4.625% due December 1, 2042 396 396 $750 million, 4.95% due October 1, 2044 740 739 $400 million, 4.80% due March 15, 2047 395 396 $500 million, 3.95% due August 15, 2049 493 493 Term loans: Term loan, due October 29, 2023 2,000 — Delayed draw term loan, due May 28, 2024 500 — Total long-term debt $ 10,541 $ 6,060 |
Schedule of Maturities of Long-term Debt | Maturities of the short-term and long-term debt for the years ending December 31, are as follows: For the years ending December 31, (in millions) 2022 $ 1,955 2023 3,500 2024 1,100 2025 600 2026 — Thereafter 5,400 |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Schedule of Compensation Expense | The compensation expense that has been charged against income for these plans was as follows for the years ended December 31, 2021, 2020, and 2019: 2021 2020 2019 (in millions) Stock-based compensation expense by type: Restricted stock $ 171 $ 171 $ 152 Stock options 9 10 11 Total stock-based compensation expense 180 181 163 Tax benefit recognized (15) (29) (35) Stock-based compensation expense, net of tax $ 165 $ 152 $ 128 |
Schedule of Restricted Stock Awards Activity | Activity for our restricted stock was as follows for the year ended December 31, 2021: Shares Weighted- (shares in thousands) Nonvested restricted stock at December 31, 2020 911 $ 282.81 Granted 485 381.34 Vested (460) 312.45 Forfeited (63) 347.42 Nonvested restricted stock at December 31, 2021 873 $ 380.55 |
Schedule of Weighted-Average Fair Value Assumptions | The fair value was estimated on the date of grant using the Black-Scholes pricing model with the weighted-average assumptions indicated below: 2021 2020 2019 Weighted-average fair value at grant date $ 92.21 $ 69.73 $ 68.53 Expected option life (years) 3.7 years 4.0 years 4.1 years Expected volatility 33.8 % 24.9 % 25.5 % Risk-free interest rate at grant date 0.4 % 1.2 % 2.4 % Dividend yield 0.7 % 0.7 % 0.7 % |
Schedule of Activity for Option Plans | Activity for our option plans was as follows for the year ended December 31, 2021: Shares Under Weighted-Average (shares in thousands) Options outstanding at December 31, 2020 323 $ 309.04 Granted 93 379.26 Exercised (106) 282.35 Forfeited — — Options outstanding at December 31, 2021 310 $ 339.08 Options exercisable at December 31, 2021 108 $ 308.22 |
EARNINGS PER COMMON SHARE COM_2
EARNINGS PER COMMON SHARE COMPUTATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Earnings Per Common Share | Detail supporting the computation of basic and diluted earnings per common share was as follows for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 (dollars in millions, except per Net income available for common stockholders $ 2,933 $ 3,367 $ 2,707 Weighted-average outstanding shares of common stock used to 128,688 132,199 134,055 Dilutive effect of: Employee stock options 64 92 107 Restricted stock 644 721 565 Shares used to compute diluted earnings per common share 129,396 133,012 134,727 Basic earnings per common share $ 22.79 $ 25.47 $ 20.20 Diluted earnings per common share $ 22.67 $ 25.31 $ 20.10 Number of antidilutive stock options and restricted stock awards 216 238 478 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Schedule of Details of Dividend Payments | The following table provides details of dividend payments, excluding dividend equivalent rights, in 2019, 2020, and 2021 under our Board approved quarterly cash dividend policy: Payment Amount Total (in millions) 2019 $2.15 $289 2020 $2.43 $322 2021 $2.73 $351 |
Schedule of Share Repurchases | Excluding shares acquired in connection with employee stock plans, share repurchases were as follows during the years ended December 31, 2021, 2020 and 2019. 2021 2020 2019 Authorization Date Purchase Not to Exceed Shares Cost Shares Cost Shares Cost (in millions) February 2021 3,000 — $ — — $ — — $ — July 2019 3,000 — — 3.80 1,750 3.40 1,000 Total repurchases — $ — 3.80 $ 1,750 3.40 $ 1,000 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, By Segment | Retail Group and Specialty Healthcare Services Eliminations/ Consolidated (in millions) 2021 External revenues Premiums: Individual Medicare Advantage $ 58,654 $ — $ — $ — $ 58,654 Group Medicare Advantage 6,955 — — — 6,955 Medicare stand-alone PDP 2,371 — — — 2,371 Total Medicare 67,980 — — — 67,980 Fully-insured 731 4,271 — — 5,002 Specialty — 1,731 — — 1,731 Medicaid and other 5,109 — — — 5,109 Total premiums 73,820 6,002 — — 79,822 Services revenue: Home Solutions — — 1,166 — 1,166 Provider — — 413 — 413 ASO and other 23 816 — — 839 Pharmacy — — 637 — 637 Total services revenue 23 816 2,216 — 3,055 Total external revenues 73,843 6,818 2,216 — 82,877 Intersegment revenues Services 1 40 19,998 (20,039) — Products — — 9,024 (9,024) — Total intersegment revenues 1 40 29,022 (29,063) — Investment income 200 14 4 (31) 187 Total revenues 74,044 6,872 31,242 (29,094) 83,064 Operating expenses: Benefits 64,907 4,951 — (659) 69,199 Operating costs 6,764 1,687 29,801 (28,131) 10,121 Depreciation and amortization 436 85 177 (102) 596 Total operating expenses 72,107 6,723 29,978 (28,892) 79,916 Income (loss) from operations 1,937 149 1,264 (202) 3,148 Interest expense — — — 326 326 Other income, net — — — (532) (532) Income before income taxes and equity in net earnings 1,937 149 1,264 4 3,354 Equity in net earnings — — 65 — 65 Segment earnings $ 1,937 $ 149 $ 1,329 $ 4 $ 3,419 Less: noncontrolling interests — — (1) — (1) Segment earnings attributable to Humana $ 1,937 $ 149 $ 1,328 $ 4 $ 3,418 Retail Group and Specialty Healthcare Services Eliminations/ Consolidated (in millions) 2020 External revenues Premiums: Individual Medicare Advantage $ 51,697 $ — $ — $ — $ 51,697 Group Medicare Advantage 7,774 — — — 7,774 Medicare stand-alone PDP 2,742 — — — 2,742 Total Medicare 62,213 — — — 62,213 Fully-insured 688 4,761 — 602 6,051 Specialty — 1,699 — — 1,699 Medicaid and other 4,223 — — — 4,223 Total premiums 67,124 6,460 — 602 74,186 Services revenue: Home Solutions — — 107 — 107 Provider — — 328 — 328 ASO and other 19 780 — — 799 Pharmacy — — 581 — 581 Total services revenue 19 780 1,016 — 1,815 Total external revenues 67,143 7,240 1,016 602 76,001 Intersegment revenues Services — 29 19,491 (19,520) — Products — — 7,928 (7,928) — Total intersegment revenues — 29 27,419 (27,448) — Investment income 155 16 13 970 1,154 Total revenues 67,298 7,285 28,448 (25,876) 77,155 Operating expenses: Benefits 56,537 5,529 — (438) 61,628 Operating costs 7,402 1,818 27,395 (26,563) 10,052 Depreciation and amortization 342 81 183 (117) 489 Total operating expenses 64,281 7,428 27,578 (27,118) 72,169 Income (loss) from operations 3,017 (143) 870 1,242 4,986 Interest expense — — — 283 283 Other expense, net — — — 103 103 Income (loss) before income taxes and equity in net earnings 3,017 (143) 870 856 4,600 Equity in net earnings — — 74 — 74 Segment earnings (loss) $ 3,017 $ (143) $ 944 $ 856 $ 4,674 Retail Group and Specialty Healthcare Services Eliminations/ Consolidated (in millions) 2019 External revenues Premiums: Individual Medicare Advantage $ 43,128 $ — $ — $ — $ 43,128 Group Medicare Advantage 6,475 — — — 6,475 Medicare stand-alone PDP 3,165 — — — 3,165 Total Medicare 52,768 — — — 52,768 Fully-insured 588 5,123 — — 5,711 Specialty — 1,571 — — 1,571 Medicaid and other 2,898 — — — 2,898 Total premiums 56,254 6,694 — — 62,948 Services revenue: Home Solutions — — 140 — 140 Provider — — 306 — 306 ASO and other 17 790 — — 807 Pharmacy — — 186 — 186 Total services revenue 17 790 632 — 1,439 Total external revenues 56,271 7,484 632 — 64,387 Intersegment revenues Services — 18 18,255 (18,273) — Products — — 6,894 (6,894) — Total intersegment revenues — 18 25,149 (25,167) — Investment income 195 23 2 281 501 Total revenues 56,466 7,525 25,783 (24,886) 64,888 Operating expenses: Benefits 48,602 5,758 — (503) 53,857 Operating costs 5,306 1,651 24,852 (24,428) 7,381 Depreciation and amortization 323 88 156 (109) 458 Total operating expenses 54,231 7,497 25,008 (25,040) 61,696 Income from operations 2,235 28 775 154 3,192 Interest expense — — — 242 242 Other income, net — — — (506) (506) Income before income taxes and equity in net earnings 2,235 28 775 418 3,456 Equity in net earnings — — 14 — 14 Segment earnings $ 2,235 $ 28 $ 789 $ 418 $ 3,470 |
REPORTING ENTITY (Details)
REPORTING ENTITY (Details) - Premiums and services revenue - Government contracts concentration risk | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Federal government contracts | |||
Concentration Risk [Line Items] | |||
Concentration risk (percent) | 83.00% | 83.00% | 82.00% |
CMS, coverage for individual Medicare Advantage members in Florida | |||
Concentration Risk [Line Items] | |||
Concentration risk (percent) | 15.00% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Nov. 02, 2017 | |
Significant Accounting Policies [Line Items] | |||||
Number of days notice for employer group to cancel short-duration prepaid health services policies | 30 days | ||||
Consumer discounts on brand name prescription drugs | 50.00% | ||||
Pharmaceutical rebates | $ 2,000,000,000 | $ 1,400,000,000 | |||
Typical term (in years) of short-duration employer-group prepaid health services policies | 1 year | ||||
Goodwill | $ 11,092,000,000 | 4,447,000,000 | $ 3,928,000,000 | ||
Goodwill impairment loss | 0 | 0 | $ 0 | ||
Impairment of indefinite-lived intangible assets | 0 | ||||
Home Solutions Reporting Unit | |||||
Significant Accounting Policies [Line Items] | |||||
Goodwill | 6,600,000,000 | ||||
Provider reporting unit | |||||
Significant Accounting Policies [Line Items] | |||||
Goodwill | $ 900,000,000 | ||||
Equipment | Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Long-lived assets estimated useful life (in years) | 3 years | ||||
Equipment | Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Long-lived assets estimated useful life (in years) | 10 years | ||||
Computer software | Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Long-lived assets estimated useful life (in years) | 3 years | ||||
Computer software | Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Long-lived assets estimated useful life (in years) | 5 years | ||||
Building | Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Long-lived assets estimated useful life (in years) | 10 years | ||||
Building | Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Long-lived assets estimated useful life (in years) | 20 years | ||||
Services | |||||
Significant Accounting Policies [Line Items] | |||||
Accounts receivable | $ 475,000,000 | 161,000,000 | |||
Medicare Supplement Product | Revenue Benchmark | Product Concentration Risk | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration risk (percent) | 1.00% | ||||
CMS reinsurance subsidies and discounts | |||||
Significant Accounting Policies [Line Items] | |||||
Settlement period after close | 9 months | ||||
CMS brand name prescription drug discounts | Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Settlement period after close | 14 months | ||||
CMS brand name prescription drug discounts | Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Settlement period after close | 18 months | ||||
US Risk Corridor Premium Stabilization Program | |||||
Significant Accounting Policies [Line Items] | |||||
Litigation recoveries sought | $ 611,000,000 | ||||
Payment received upon judgement | $ 609,000,000 | 609,000,000 | |||
Related legal fees and expenses | 31,000,000 | ||||
Health Care Reform | |||||
Significant Accounting Policies [Line Items] | |||||
Payment of annual health insurance industry fee | $ 1,180,000,000 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Part D Subsidy/Discount Payments, Net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | |||
Part D subsidy/discount payments | $ (14,889) | $ (13,348) | $ (11,762) |
Part D subsidy/discount reimbursements | 14,628 | 12,410 | 11,202 |
Net payments | $ (261) | $ (938) | $ (560) |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Health Care Cost Payments, Net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | |||
Health care cost payments | $ (6,943) | $ (6,253) | $ (6,475) |
Health care cost reimbursements | 6,898 | 6,252 | 6,412 |
Net payments | $ (45) | $ (1) | $ (63) |
ACQUISITIONS - Narrative (Detai
ACQUISITIONS - Narrative (Details) - USD ($) $ in Millions | Aug. 17, 2021 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosures by Disposal Groups [Line Items] | ||||
Equity method investments | $ 141 | $ 1,170 | ||
Purchase price allocated to goodwill | $ 6,645 | $ 519 | ||
Kindred at Home | ||||
Disclosures by Disposal Groups [Line Items] | ||||
Equity method investments | $ 1,300 | |||
Kindred at Home | ||||
Disclosures by Disposal Groups [Line Items] | ||||
Remaining ownership percentage acquired | 60.00% | |||
Enterprise value of acquiree including existing equity value | $ 8,200 | |||
Existing equity value | $ 2,400 | |||
Minority ownership prior to acquisition (percent) | 40.00% | |||
Remeasurement gain | $ 1,100 | |||
Transaction amount, net of existing equity stake | 5,800 | |||
Goodwill expected to be tax deductible | 132 | |||
Acquisition-related costs | 45 | |||
Purchase price allocated to net tangible liabilities | 2,857 | |||
Kindred at Home | Trade names and technology | ||||
Disclosures by Disposal Groups [Line Items] | ||||
Purchase price allocated to other intangible assets | $ 18 | |||
Estimated weighted average useful life of acquired intangible assets (in years) | 10 years | |||
Enclara | ||||
Disclosures by Disposal Groups [Line Items] | ||||
Purchase price allocated to other intangible assets | $ 240 | |||
Estimated weighted average useful life of acquired intangible assets (in years) | 11 years | |||
Cash consideration for acquisition | $ 709 | |||
Purchase price allocated to goodwill | 517 | |||
Purchase price allocated to net tangible liabilities | $ 13 |
ACQUISITIONS - Preliminary Fair
ACQUISITIONS - Preliminary Fair Value on Date of Acquisition (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Aug. 17, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract] | ||||
Goodwill | $ 11,092 | $ 4,447 | $ 3,928 | |
Kindred at Home | ||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract] | ||||
Cash and cash equivalents | $ 278 | |||
Receivables | 381 | |||
Other current assets | 61 | |||
Property and equipment | 74 | |||
Goodwill | 5,771 | |||
Other intangible assets | 2,312 | |||
Other long-term assets | 172 | |||
Total assets acquired | 9,049 | |||
Current liabilities | 410 | |||
Long term debt | 2,078 | |||
Other long-term liabilities | 369 | |||
Total liabilities assumed | 2,857 | |||
Noncontrolling interests | 22 | |||
Net assets acquired | $ 6,170 |
EQUITY METHOD INVESTMENT - Narr
EQUITY METHOD INVESTMENT - Narrative (Details) - primaryCareCenter | 12 Months Ended | |
Dec. 31, 2021 | Sep. 30, 2018 | |
Schedule of Equity Method Investments [Line Items] | ||
Number of primary care centers in strategic partnership | 31 | |
Number of additional primary care centers expected to be opened in strategic partnership | 36 | |
WCAS | ||
Schedule of Equity Method Investments [Line Items] | ||
Time frame for put and call option activity per partnership agreement, minimum | 4 years | |
Time frame for put and call option activity per partnership agreement, maximum | 9 years | |
Kindred at Home | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity method investment ownership (percent) | 40.00% |
EQUITY METHOD INVESTMENT - Summ
EQUITY METHOD INVESTMENT - Summarized Balance Sheets and Statements of Income (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Balance sheet | |||
Current assets | $ 24,893 | $ 23,641 | |
Current liabilities | 15,331 | 13,394 | |
Income Statement Related Disclosures [Abstract] | |||
Revenues | 83,064 | 77,155 | $ 64,888 |
Net income attributable to Humana | $ 2,933 | 3,367 | 2,707 |
Kindred at Home | |||
Balance sheet | |||
Current assets | 844 | ||
Non-current assets | 4,858 | ||
Current liabilities | 556 | ||
Non-current liabilities | 2,445 | ||
Shareholders' equity | 2,700 | ||
Income Statement Related Disclosures [Abstract] | |||
Revenues | 2,972 | 3,100 | |
Expenses | 2,552 | 2,835 | |
Net income attributable to Humana | $ 207 | $ 54 |
INVESTMENT SECURITIES - Classif
INVESTMENT SECURITIES - Classified as Current and Long-Term (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Securities Amortized Cost to Fair Value | ||
Amortized Cost | $ 13,440 | $ 12,437 |
Gross Unrealized Gains | 218 | 520 |
Gross Unrealized Losses | (161) | (6) |
Fair Value | 13,497 | 12,951 |
Common stock | 475 | 815 |
Total investment securities | 13,972 | 13,766 |
U.S. Treasury and agency obligations | ||
Debt Securities Amortized Cost to Fair Value | ||
Amortized Cost | 611 | 616 |
Gross Unrealized Gains | 1 | 1 |
Gross Unrealized Losses | (10) | (1) |
Fair Value | 602 | 616 |
Mortgage-backed securities | ||
Debt Securities Amortized Cost to Fair Value | ||
Amortized Cost | 3,265 | 3,115 |
Gross Unrealized Gains | 33 | 140 |
Gross Unrealized Losses | (69) | (1) |
Fair Value | 3,229 | 3,254 |
Tax-exempt municipal securities | ||
Debt Securities Amortized Cost to Fair Value | ||
Amortized Cost | 810 | 1,393 |
Gross Unrealized Gains | 33 | 54 |
Gross Unrealized Losses | (2) | 0 |
Fair Value | 841 | 1,447 |
Residential | ||
Debt Securities Amortized Cost to Fair Value | ||
Amortized Cost | 373 | 17 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (6) | 0 |
Fair Value | 367 | 17 |
Commercial | ||
Debt Securities Amortized Cost to Fair Value | ||
Amortized Cost | 1,394 | 1,260 |
Gross Unrealized Gains | 27 | 59 |
Gross Unrealized Losses | (11) | (1) |
Fair Value | 1,410 | 1,318 |
Asset-backed securities | ||
Debt Securities Amortized Cost to Fair Value | ||
Amortized Cost | 1,346 | 1,364 |
Gross Unrealized Gains | 6 | 10 |
Gross Unrealized Losses | (4) | (2) |
Fair Value | 1,348 | 1,372 |
Corporate debt securities | ||
Debt Securities Amortized Cost to Fair Value | ||
Amortized Cost | 5,641 | 4,672 |
Gross Unrealized Gains | 118 | 256 |
Gross Unrealized Losses | (59) | (1) |
Fair Value | $ 5,700 | $ 4,927 |
INVESTMENT SECURITIES - Gross U
INVESTMENT SECURITIES - Gross Unrealized Losses and Fair Values of Securities (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Fair Value | ||
Less than 12 months | $ 4,990 | $ 1,057 |
12 months or more | 2,547 | 576 |
Total | 7,537 | 1,633 |
Gross Unrealized Losses | ||
Less than 12 months | (94) | (4) |
12 months or more | (67) | (2) |
Total | (161) | (6) |
U.S. Treasury and agency obligations | ||
Fair Value | ||
Less than 12 months | 201 | 225 |
12 months or more | 355 | 0 |
Total | 556 | 225 |
Gross Unrealized Losses | ||
Less than 12 months | (3) | (1) |
12 months or more | (7) | 0 |
Total | (10) | (1) |
Mortgage-backed securities | ||
Fair Value | ||
Less than 12 months | 2,082 | 199 |
12 months or more | 556 | 0 |
Total | 2,638 | 199 |
Gross Unrealized Losses | ||
Less than 12 months | (49) | (1) |
12 months or more | (20) | 0 |
Total | (69) | (1) |
Tax-exempt municipal securities | ||
Fair Value | ||
Less than 12 months | 68 | 16 |
12 months or more | 34 | 19 |
Total | 102 | 35 |
Gross Unrealized Losses | ||
Less than 12 months | (1) | 0 |
12 months or more | (1) | 0 |
Total | (2) | 0 |
Residential | ||
Fair Value | ||
Less than 12 months | 358 | 17 |
12 months or more | 8 | 0 |
Total | 366 | 17 |
Gross Unrealized Losses | ||
Less than 12 months | (6) | 0 |
12 months or more | 0 | 0 |
Total | (6) | 0 |
Commercial | ||
Fair Value | ||
Less than 12 months | 295 | 193 |
12 months or more | 400 | 43 |
Total | 695 | 236 |
Gross Unrealized Losses | ||
Less than 12 months | (4) | (1) |
12 months or more | (7) | 0 |
Total | (11) | (1) |
Asset-backed securities | ||
Fair Value | ||
Less than 12 months | 530 | 65 |
12 months or more | 425 | 498 |
Total | 955 | 563 |
Gross Unrealized Losses | ||
Less than 12 months | (3) | 0 |
12 months or more | (1) | (2) |
Total | (4) | (2) |
Corporate debt securities | ||
Fair Value | ||
Less than 12 months | 1,456 | 342 |
12 months or more | 769 | 16 |
Total | 2,225 | 358 |
Gross Unrealized Losses | ||
Less than 12 months | (28) | (1) |
12 months or more | (31) | 0 |
Total | $ (59) | $ (1) |
INVESTMENT SECURITIES - Narrati
INVESTMENT SECURITIES - Narrative (Details) | 12 Months Ended |
Dec. 31, 2021position | |
Investments, Debt and Equity Securities [Abstract] | |
Percentage of debt securities considered to be of investment-grade (percent) | 95.00% |
Maximum individual state general bond obligation as a percentage of total debt securities (percent) | 1.00% |
Securities in unrealized loss position, number of positions | 720 |
Securities, number of positions | 1,730 |
INVESTMENT SECURITIES - Realize
INVESTMENT SECURITIES - Realized Gains (Losses) Included Within Investment Income (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |||
Gross gains on investment securities | $ 219 | $ 110 | $ 129 |
Gross losses on investment securities | (8) | (18) | (67) |
Gross gains on equity securities | 23 | 746 | 0 |
Gross losses on equity securities | (364) | 0 | 0 |
Net recognized (losses) gains on investment securities | $ (130) | $ 838 | $ 62 |
INVESTMENT SECURITIES - Gains (
INVESTMENT SECURITIES - Gains (Losses) on Equity Securities (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | ||
Net (losses) gains recognized on equity securities during the period | $ (341) | $ 746 |
Less: Net losses recognized on equity securities sold during the period | (13) | 0 |
Unrealized (losses) gains recognized on equity securities still held at the end of the period | $ (328) | $ 746 |
INVESTMENT SECURITIES - Contrac
INVESTMENT SECURITIES - Contractual Maturities of Debt Securities Available for Sale (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Amortized Cost | ||
Due within one year | $ 459 | |
Due after one year through five years | 2,200 | |
Due after five years through ten years | 3,043 | |
Due after ten years | 1,360 | |
Mortgage and asset-backed securities | 6,378 | |
Amortized Cost | 13,440 | $ 12,437 |
Fair Value | ||
Due within one year | 461 | |
Due after one year through five years | 2,251 | |
Due after five years through ten years | 3,057 | |
Due after ten years | 1,374 | |
Mortgage and asset-backed securities | 6,354 | |
Fair Value | $ 13,497 | $ 12,951 |
FAIR VALUE - Financial Assets M
FAIR VALUE - Financial Assets Measured on Recurring Basis (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | $ 13,497 | $ 12,951 |
Common stock | 475 | 815 |
U.S. Treasury and agency obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 602 | 616 |
Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 3,229 | 3,254 |
Tax-exempt municipal securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 841 | 1,447 |
Residential | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 367 | 17 |
Commercial | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 1,410 | 1,318 |
Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 1,348 | 1,372 |
Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 5,700 | 4,927 |
Recurring Basis | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 3,322 | 4,548 |
Debt securities | 13,497 | 12,951 |
Common stock | 475 | 815 |
Total invested assets | 17,294 | 18,314 |
Recurring Basis | U.S. Treasury and agency obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 602 | 616 |
Recurring Basis | Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 3,229 | 3,254 |
Recurring Basis | Tax-exempt municipal securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 841 | 1,447 |
Recurring Basis | Residential | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 367 | 17 |
Recurring Basis | Commercial | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 1,410 | 1,318 |
Recurring Basis | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 1,348 | 1,372 |
Recurring Basis | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 5,700 | 4,927 |
Recurring Basis | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 3,322 | 4,548 |
Debt securities | 0 | 0 |
Common stock | 475 | 815 |
Total invested assets | 3,797 | 5,363 |
Recurring Basis | Quoted Prices in Active Markets (Level 1) | U.S. Treasury and agency obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Quoted Prices in Active Markets (Level 1) | Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Quoted Prices in Active Markets (Level 1) | Tax-exempt municipal securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Quoted Prices in Active Markets (Level 1) | Residential | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Quoted Prices in Active Markets (Level 1) | Commercial | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Quoted Prices in Active Markets (Level 1) | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Quoted Prices in Active Markets (Level 1) | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Debt securities | 13,429 | 12,951 |
Common stock | 0 | 0 |
Total invested assets | 13,429 | 12,951 |
Recurring Basis | Other Observable Inputs (Level 2) | U.S. Treasury and agency obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 602 | 616 |
Recurring Basis | Other Observable Inputs (Level 2) | Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 3,229 | 3,254 |
Recurring Basis | Other Observable Inputs (Level 2) | Tax-exempt municipal securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 841 | 1,447 |
Recurring Basis | Other Observable Inputs (Level 2) | Residential | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 367 | 17 |
Recurring Basis | Other Observable Inputs (Level 2) | Commercial | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 1,410 | 1,318 |
Recurring Basis | Other Observable Inputs (Level 2) | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 1,348 | 1,372 |
Recurring Basis | Other Observable Inputs (Level 2) | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 5,632 | 4,927 |
Recurring Basis | Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Debt securities | 68 | 0 |
Common stock | 0 | 0 |
Total invested assets | 68 | 0 |
Recurring Basis | Unobservable Inputs (Level 3) | U.S. Treasury and agency obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Unobservable Inputs (Level 3) | Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Unobservable Inputs (Level 3) | Tax-exempt municipal securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Unobservable Inputs (Level 3) | Residential | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Unobservable Inputs (Level 3) | Commercial | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Unobservable Inputs (Level 3) | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Recurring Basis | Unobservable Inputs (Level 3) | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | $ 68 | $ 0 |
FAIR VALUE - Narrative (Details
FAIR VALUE - Narrative (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2021 | Apr. 27, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Termination of put and call options | $ 377,000,000 | |||
Unobservable Inputs (Level 3) | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value | $ 68,000,000 | |||
Unobservable Inputs (Level 3) | Investments | Fair Value Risk | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Concentration risk (percent) | 0.40% | |||
Put option | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value of financial liability | $ 202,000,000 | $ 64,000,000 | ||
Call option | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value of financial asset | 13,000,000 | 15,000,000 | ||
Other long-term liabilities | Put option | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value of financial liability | $ 0 | $ 63,000,000 | 45,000,000 | |
Other long-term assets | Call option | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value of financial asset | $ 0 | $ 440,000,000 | 503,000,000 | |
Kindred at Home | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Equity interest to be acquired per agreement (percent) | 60.00% | |||
Term loan and commercial paper | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Short-term debt | 3,500,000,000 | |||
Commercial paper | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Short-term debt | 955,000,000 | 600,000,000 | ||
Carrying Value | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Debt outstanding | 9,000,000,000 | 6,100,000,000 | ||
Fair Value | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Debt outstanding | $ 10,000,000,000 | $ 7,400,000,000 |
FAIR VALUE - Significant Unobse
FAIR VALUE - Significant Unobservable Inputs (Level 3) (Details) - Private Placements $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balance at January 1 | $ 0 |
Total gains or losses: | |
Realized in earnings | 0 |
Unrealized in other comprehensive income | (1) |
Purchases | 69 |
Sales | 0 |
Settlements | 0 |
Balance at December 31 | $ 68 |
FAIR VALUE - Put and Call Optio
FAIR VALUE - Put and Call Options Measured at Fair Value (Details) - Options - Level 3 fair value measurement | Dec. 31, 2021 | Dec. 31, 2020 |
Annualized volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Significant unobservable inputs | 0.224 | 0.299 |
Secured credit rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Significant unobservable inputs | 0.004 | |
NOPAT | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Significant unobservable inputs | 0.120 | |
Credit spread | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Significant unobservable inputs | 0.009 | |
Revenue exit multiple | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Significant unobservable inputs | 1.5 | |
Revenue exit multiple | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Significant unobservable inputs | 2.5 | |
Weighted average cost of capital | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Significant unobservable inputs | 0.125 | 0.095 |
Long term growth rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Significant unobservable inputs | 0.030 | 0.030 |
MEDICARE PART D (Details)
MEDICARE PART D (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Segment Reporting Information [Line Items] | ||
Other current assets | $ 6,493 | $ 5,276 |
Trade accounts payable and accrued expenses | (4,509) | (4,013) |
Other long-term assets | 4,379 | 2,128 |
Other long-term liabilities | (2,383) | (1,787) |
Risk Corridor Settlement | ||
Segment Reporting Information [Line Items] | ||
Other current assets | 363 | 216 |
Trade accounts payable and accrued expenses | (68) | (39) |
Net current asset | 295 | 177 |
Other long-term assets | 5 | 8 |
Other long-term liabilities | (194) | (90) |
Net long-term liability | (189) | (82) |
Total net asset | 106 | 95 |
CMS Subsidies/ Discounts | ||
Segment Reporting Information [Line Items] | ||
Other current assets | 1,894 | 1,420 |
Trade accounts payable and accrued expenses | (466) | (253) |
Net current asset | 1,428 | 1,167 |
Other long-term assets | 0 | 0 |
Other long-term liabilities | 0 | 0 |
Net long-term liability | 0 | 0 |
Total net asset | $ 1,428 | $ 1,167 |
PROPERTY AND EQUIPMENT, NET - P
PROPERTY AND EQUIPMENT, NET - Property and Equipment Balances (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 5,947 | $ 5,494 |
Accumulated depreciation | (2,874) | (3,123) |
Property and equipment, net | 3,073 | 2,371 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 17 | 19 |
Buildings and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 1,126 | 952 |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 1,148 | 1,009 |
Computer software | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 3,656 | $ 3,514 |
PROPERTY AND EQUIPMENT, NET - N
PROPERTY AND EQUIPMENT, NET - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 640 | $ 528 | $ 505 |
Amortization expense for capitalized internally developed and purchased software | $ 443 | $ 351 | $ 343 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Changes in Carrying Amount of Goodwill by Reportable Segments (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 4,447 | $ 3,928 |
Acquisitions | 6,645 | 519 |
Ending balance | 11,092 | 4,447 |
Retail | ||
Goodwill [Roll Forward] | ||
Beginning balance | 1,535 | 1,535 |
Acquisitions | 398 | 0 |
Ending balance | 1,933 | 1,535 |
Group and Specialty | ||
Goodwill [Roll Forward] | ||
Beginning balance | 261 | 261 |
Acquisitions | 0 | 0 |
Ending balance | 261 | 261 |
Healthcare Services | ||
Goodwill [Roll Forward] | ||
Beginning balance | 2,651 | 2,132 |
Acquisitions | 6,247 | 519 |
Ending balance | $ 8,898 | $ 2,651 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Details of Intangible Assets Included in Other Long-Term Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Intangible Assets | ||
Weighted Average Life | 9 years 1 month 6 days | |
Total other intangible assets, cost | $ 3,443 | $ 1,069 |
Accumulated Amortization | 804 | 740 |
Total other intangible assets, net | 2,639 | 329 |
Certificates of need | ||
Intangible Assets | ||
Indefinite-lived intangible assets | 1,771 | 0 |
Medicare licenses | ||
Intangible Assets | ||
Indefinite-lived intangible assets | $ 522 | 0 |
Customer contracts/relationships | ||
Intangible Assets | ||
Weighted Average Life | 9 years 4 months 24 days | |
Cost | $ 883 | 849 |
Accumulated Amortization | 620 | 572 |
Net | $ 263 | 277 |
Trade names and technology | ||
Intangible Assets | ||
Weighted Average Life | 7 years | |
Cost | $ 160 | 122 |
Accumulated Amortization | 97 | 89 |
Net | $ 63 | 33 |
Provider contracts | ||
Intangible Assets | ||
Weighted Average Life | 11 years 7 months 6 days | |
Cost | $ 72 | 69 |
Accumulated Amortization | 57 | 50 |
Net | $ 15 | 19 |
Noncompetes and other | ||
Intangible Assets | ||
Weighted Average Life | 6 years 9 months 18 days | |
Cost | $ 35 | 29 |
Accumulated Amortization | 30 | 29 |
Net | $ 5 | $ 0 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense for other intangible assets | $ 65 | $ 88 | $ 70 |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS - Estimate of Amortization Expense (Details) $ in Millions | Dec. 31, 2021USD ($) |
Estimate of Amortization Expense | |
2022 | $ 68 |
2023 | 53 |
2024 | 45 |
2025 | 43 |
2026 | $ 31 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | ||
ROU asset, balance sheet line item | Other long-term assets | Other long-term assets |
ROU assets included within other long-term assets | $ 678 | $ 437 |
Operating lease liabilities current, balance sheet line item | Trade accounts payable and accrued expenses | Trade accounts payable and accrued expenses |
Operating lease liabilities included within trade accounts payable and accrued expenses | $ 185 | $ 129 |
Operating lease liabilities noncurrent, balance sheet line item | Other long-term liabilities | Other long-term liabilities |
Operating lease liabilities included within other long-term liabilities | $ 546 | $ 355 |
Fixed operating lease costs | 159 | 141 |
Variable lease costs | 94 | 92 |
Sublease rental income | $ 43 | $ 36 |
Weighted average remaining lease term (in years) | 5 years 4 months 24 days | 5 years 2 months 12 days |
Weighted average discount rate (percent) | 3.20% | 3.70% |
Operating lease cash payments | $ 165 | $ 146 |
LEASES - Maturity of Lease Liab
LEASES - Maturity of Lease Liabilities (Details) $ in Millions | Dec. 31, 2021USD ($) |
Maturity of Lease Liabilities | |
2022 | $ 210 |
2023 | 170 |
2024 | 133 |
2025 | 105 |
2026 | 58 |
After 2026 | 129 |
Total lease payments | 805 |
Less: Interest | 74 |
Present value of lease liabilities | $ 731 |
BENEFITS PAYABLE - Activity in
BENEFITS PAYABLE - Activity in Benefits Payable (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | |||
Balances, beginning of period | $ 8,143 | $ 6,004 | $ 4,862 |
Less: Reinsurance recoverables | 0 | (68) | (95) |
Balances, beginning of period, net | 8,143 | 5,936 | 4,767 |
Acquisitions | 42 | 0 | 0 |
Incurred related to: | |||
Current year | 70,024 | 61,941 | 54,193 |
Prior years | (825) | (313) | (336) |
Total incurred | 69,199 | 61,628 | 53,857 |
Paid related to: | |||
Current year | (62,149) | (54,003) | (48,421) |
Prior years | (6,946) | (5,418) | (4,267) |
Total paid | (69,095) | (59,421) | (52,688) |
Reinsurance recoverable | 0 | 0 | 68 |
Balances, end of period | 8,289 | 8,143 | 6,004 |
Retail | |||
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | |||
Balances, beginning of period | 7,428 | 5,363 | 4,338 |
Less: Reinsurance recoverables | 0 | (68) | (95) |
Balances, beginning of period, net | 7,428 | 5,295 | 4,243 |
Acquisitions | 42 | 0 | 0 |
Incurred related to: | |||
Current year | 65,636 | 56,821 | 48,983 |
Prior years | (729) | (266) | (386) |
Total incurred | 64,907 | 56,555 | 48,597 |
Paid related to: | |||
Current year | (58,363) | (49,586) | (43,831) |
Prior years | (6,339) | (4,836) | (3,714) |
Total paid | (64,702) | (54,422) | (47,545) |
Reinsurance recoverable | 0 | 0 | 68 |
Balances, end of period | 7,675 | 7,428 | 5,363 |
Group and Specialty | |||
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | |||
Balances, beginning of period | 715 | 641 | 517 |
Incurred related to: | |||
Current year | 5,047 | 5,576 | 5,708 |
Prior years | (96) | (47) | 50 |
Total incurred | 4,951 | 5,529 | 5,758 |
Paid related to: | |||
Current year | (4,445) | (4,873) | (5,081) |
Prior years | (607) | (582) | (553) |
Total paid | (5,052) | (5,455) | (5,634) |
Balances, end of period | $ 614 | $ 715 | $ 641 |
BENEFITS PAYABLE - Narrative (D
BENEFITS PAYABLE - Narrative (Details) claim in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021USD ($)claim | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Claims Development [Line Items] | |||
Favorable medical claims reserve development related to prior fiscal years | $ | $ 825 | $ 313 | $ 336 |
Retail | |||
Claims Development [Line Items] | |||
Total IBNR | $ | 5,200 | ||
Group and Specialty | |||
Claims Development [Line Items] | |||
Total IBNR | $ | $ 532 | ||
2021 Claims Incurred Year | Retail | |||
Claims Development [Line Items] | |||
Cumulative number of reported claims | 156.1 | ||
2021 Claims Incurred Year | Group and Specialty | |||
Claims Development [Line Items] | |||
Cumulative number of reported claims | 8.3 | ||
2020 Claims Incurred Year | Retail | |||
Claims Development [Line Items] | |||
Cumulative number of reported claims | 140.4 | ||
2020 Claims Incurred Year | Group and Specialty | |||
Claims Development [Line Items] | |||
Cumulative number of reported claims | 9.1 | ||
2019 Claims Incurred Year | Retail | |||
Claims Development [Line Items] | |||
Cumulative number of reported claims | 129.1 | ||
2019 Claims Incurred Year | Group and Specialty | |||
Claims Development [Line Items] | |||
Cumulative number of reported claims | 10.1 |
BENEFITS PAYABLE - Favorable Me
BENEFITS PAYABLE - Favorable Medical Claims Reserve Development (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Liability for Claims and Claims Adjustment Expense [Line Items] | |||
(Favorable) unfavorable medical claims reserve development | $ (825) | $ (313) | $ (336) |
Retail | |||
Liability for Claims and Claims Adjustment Expense [Line Items] | |||
(Favorable) unfavorable medical claims reserve development | (729) | (266) | (386) |
Group and Specialty | |||
Liability for Claims and Claims Adjustment Expense [Line Items] | |||
(Favorable) unfavorable medical claims reserve development | (96) | (47) | 50 |
Operating Segments | Retail | |||
Liability for Claims and Claims Adjustment Expense [Line Items] | |||
(Favorable) unfavorable medical claims reserve development | (729) | (266) | (386) |
Operating Segments | Group and Specialty | |||
Liability for Claims and Claims Adjustment Expense [Line Items] | |||
(Favorable) unfavorable medical claims reserve development | $ (96) | $ (47) | $ 50 |
BENEFITS PAYABLE - Incurred and
BENEFITS PAYABLE - Incurred and Paid Claims Development (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Retail | |||
Claims Development [Line Items] | |||
Incurred Claims, Net of Reinsurance | $ 170,614 | ||
Cumulative Paid Claims, Net of Reinsurance | 162,939 | ||
Benefits payable, net of reinsurance | 7,675 | ||
Group and Specialty | |||
Claims Development [Line Items] | |||
Incurred Claims, Net of Reinsurance | 16,190 | ||
Cumulative Paid Claims, Net of Reinsurance | 15,576 | ||
Benefits payable, net of reinsurance | 614 | ||
2019 Claims Incurred Year | Retail | |||
Claims Development [Line Items] | |||
Incurred Claims, Net of Reinsurance | 48,713 | $ 48,820 | $ 48,983 |
Cumulative Paid Claims, Net of Reinsurance | 48,713 | 48,627 | 43,831 |
2019 Claims Incurred Year | Group and Specialty | |||
Claims Development [Line Items] | |||
Incurred Claims, Net of Reinsurance | 5,652 | 5,657 | 5,708 |
Cumulative Paid Claims, Net of Reinsurance | 5,652 | 5,465 | $ 5,081 |
2020 Claims Incurred Year | Retail | |||
Claims Development [Line Items] | |||
Incurred Claims, Net of Reinsurance | 56,223 | 56,821 | |
Cumulative Paid Claims, Net of Reinsurance | 55,863 | 49,586 | |
2020 Claims Incurred Year | Group and Specialty | |||
Claims Development [Line Items] | |||
Incurred Claims, Net of Reinsurance | 5,491 | 5,576 | |
Cumulative Paid Claims, Net of Reinsurance | 5,479 | $ 4,873 | |
2021 Claims Incurred Year | Retail | |||
Claims Development [Line Items] | |||
Incurred Claims, Net of Reinsurance | 65,678 | ||
Cumulative Paid Claims, Net of Reinsurance | 58,363 | ||
2021 Claims Incurred Year | Group and Specialty | |||
Claims Development [Line Items] | |||
Incurred Claims, Net of Reinsurance | 5,047 | ||
Cumulative Paid Claims, Net of Reinsurance | $ 4,445 |
INCOME TAXES - Provision for In
INCOME TAXES - Provision for Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Federal | $ 466 | $ 1,019 | $ 560 |
States and Puerto Rico | 4 | 93 | 41 |
Total current provision | 470 | 1,112 | 601 |
Deferred expense | 15 | 195 | 162 |
Provision for income taxes | $ 485 | $ 1,307 | $ 763 |
INCOME TAXES - Provision for _2
INCOME TAXES - Provision for Income Taxes Reconciliation (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Income tax provision at federal statutory rate | $ 718 | $ 982 | $ 729 |
States, net of federal benefit, and Puerto Rico | 18 | 63 | 49 |
Tax exempt investment income | (3) | (5) | (6) |
Nondeductible executive compensation | 33 | 19 | 25 |
Non-taxable KAH gain | (264) | 0 | 0 |
Health insurance industry fee | 0 | 268 | 0 |
Other, net | (17) | (20) | (34) |
Provision for income taxes | $ 485 | $ 1,307 | $ 763 |
INCOME TAXES - Principal Compon
INCOME TAXES - Principal Components of Net Deferred Tax Balances (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforward | $ 291 | $ 32 |
Compensation and other accrued expense | 186 | 171 |
Benefits payable | 67 | 87 |
Deferred acquisition costs | 33 | 26 |
Jobs tax credits | 33 | 0 |
Other | 25 | 11 |
Unearned revenues | 8 | 12 |
Total deferred income tax assets | 643 | 339 |
Valuation allowance | (65) | (37) |
Total deferred income tax assets, net of valuation allowance | 578 | 302 |
Depreciable property and intangible assets | (1,072) | (449) |
Prepaid expenses | (102) | (91) |
Investment securities | (98) | (418) |
Future policy benefits payable | (4) | (3) |
Total deferred income tax liabilities | (1,276) | (961) |
Total net deferred income tax liabilities | $ (698) | $ (659) |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Tax Credit Carryforward [Line Items] | ||
Valuation allowances on net operating loss carryforwards related to prior acquisitions | $ 65 | $ 37 |
Federal | ||
Tax Credit Carryforward [Line Items] | ||
Net operating losses to carryforward related to prior acquisitions | 930 | |
State and Puerto Rico | ||
Tax Credit Carryforward [Line Items] | ||
Net operating losses to carryforward related to prior acquisitions | $ 1,700 |
DEBT - Debt Outstanding (Detail
DEBT - Debt Outstanding (Details) - USD ($) | Dec. 31, 2021 | Aug. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | |||
Total short-term debt | $ 1,953,000,000 | $ 600,000,000 | |
Long-term debt | 10,541,000,000 | 6,060,000,000 | |
Senior notes | |||
Debt Instrument [Line Items] | |||
Long-term debt, current maturities | 998,000,000 | 0 | |
Senior notes | $600 million, 3.15% due December 1, 2022 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 600,000,000 | ||
Stated interest rate (percent) | 3.15% | ||
Long-term debt, current maturities | $ 599,000,000 | 0 | |
Long-term debt | 0 | 598,000,000 | |
Senior notes | $400 million, 2.90% due December 15, 2022 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 400,000,000 | ||
Stated interest rate (percent) | 2.90% | ||
Long-term debt, current maturities | $ 399,000,000 | 0 | |
Long-term debt | 0 | 398,000,000 | |
Senior notes | $1.5 billion, 0.65% due August 3, 2023 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 1,500,000,000 | $ 1,500,000,000 | |
Stated interest rate (percent) | 0.65% | 0.65% | |
Long-term debt | $ 1,492,000,000 | 0 | |
Senior notes | $600 million, 3.85% due October 1, 2024 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 600,000,000 | ||
Stated interest rate (percent) | 3.85% | ||
Long-term debt | $ 598,000,000 | 598,000,000 | |
Senior notes | $600 million, 4.50% due April 1, 2025 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 600,000,000 | ||
Stated interest rate (percent) | 4.50% | ||
Long-term debt | $ 596,000,000 | 595,000,000 | |
Senior notes | $750 million, 1.35% due February 3, 2027 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 750,000,000 | $ 750,000,000 | |
Stated interest rate (percent) | 1.35% | 1.35% | |
Long-term debt | $ 742,000,000 | 0 | |
Senior notes | $600 million, 3.95% due March 15, 2027 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 600,000,000 | ||
Stated interest rate (percent) | 3.95% | ||
Long-term debt | $ 596,000,000 | 596,000,000 | |
Senior notes | $500 million, 3.125% due August 15, 2029 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 500,000,000 | ||
Stated interest rate (percent) | 3.125% | ||
Long-term debt | $ 496,000,000 | 495,000,000 | |
Senior notes | $500 million, 4.875% due April 1, 2030 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 500,000,000 | ||
Stated interest rate (percent) | 4.875% | ||
Long-term debt | $ 495,000,000 | 494,000,000 | |
Senior notes | $750 million, 2.15% due February 3, 2032 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 750,000,000 | $ 750,000,000 | |
Stated interest rate (percent) | 2.15% | 2.15% | |
Long-term debt | $ 741,000,000 | 0 | |
Senior notes | $250 million, 8.15% due June 15, 2038 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 250,000,000 | ||
Stated interest rate (percent) | 8.15% | ||
Long-term debt | $ 261,000,000 | 262,000,000 | |
Senior notes | $400 million, 4.625% due December 1, 2042 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 400,000,000 | ||
Stated interest rate (percent) | 4.625% | ||
Long-term debt | $ 396,000,000 | 396,000,000 | |
Senior notes | $750 million, 4.95% due October 1, 2044 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 750,000,000 | ||
Stated interest rate (percent) | 4.95% | ||
Long-term debt | $ 740,000,000 | 739,000,000 | |
Senior notes | $400 million, 4.80% due March 15, 2047 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 400,000,000 | ||
Stated interest rate (percent) | 4.80% | ||
Long-term debt | $ 395,000,000 | 396,000,000 | |
Senior notes | $500 million, 3.95% due August 15, 2049 | |||
Debt Instrument [Line Items] | |||
Aggregate principal | $ 500,000,000 | ||
Stated interest rate (percent) | 3.95% | ||
Long-term debt | $ 493,000,000 | 493,000,000 | |
Loans Payable | Term loan, due October 29, 2023 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 2,000,000,000 | 0 | |
Loans Payable | Delayed draw term loan, due May 28, 2024 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 500,000,000 | 0 | |
Commercial paper | |||
Debt Instrument [Line Items] | |||
Short-term debt | $ 955,000,000 | $ 600,000,000 |
DEBT - Maturities of Debt (Deta
DEBT - Maturities of Debt (Details) $ in Millions | Dec. 31, 2021USD ($) |
Maturities of debt | |
2022 | $ 1,955 |
2023 | 3,500 |
2024 | 1,100 |
2025 | 600 |
2026 | 0 |
Thereafter | $ 5,400 |
DEBT - Senior Notes (Details)
DEBT - Senior Notes (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Aug. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | May 31, 2021 | |
Debt Instrument [Line Items] | |||||
Proceeds from term loan | $ 2,500,000,000 | $ 1,000,000,000 | $ 0 | ||
Senior notes | |||||
Debt Instrument [Line Items] | |||||
Redemption price, percentage | 100.00% | ||||
Proceeds from term loan | $ 2,984,000,000 | ||||
Senior notes | $250 million, 8.15% due June 15, 2038 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate (percent) | 8.15% | ||||
Aggregate principal | $ 250,000,000 | ||||
Senior notes | $1.5 billion, 0.65% due August 3, 2023 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate (percent) | 0.65% | 0.65% | |||
Aggregate principal | $ 1,500,000,000 | $ 1,500,000,000 | |||
Senior notes | $750 million, 1.35% due February 3, 2027 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate (percent) | 1.35% | 1.35% | |||
Aggregate principal | $ 750,000,000 | $ 750,000,000 | |||
Senior notes | $750 million, 2.15% due February 3, 2032 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate (percent) | 2.15% | 2.15% | |||
Aggregate principal | $ 750,000,000 | $ 750,000,000 | |||
Loans Payable | Delayed Draw Term Loan May 2021 | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal | $ 500,000,000 | ||||
Proceeds from term loan | $ 500,000,000 |
DEBT - Delayed Draw Term Loan C
DEBT - Delayed Draw Term Loan Credit Agreement (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Aug. 31, 2021 | May 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Aug. 17, 2021 | |
Short-term Debt [Line Items] | ||||||
Proceeds from term loan | $ 2,500,000,000 | $ 1,000,000,000 | $ 0 | |||
Kindred at Home | ||||||
Short-term Debt [Line Items] | ||||||
Transaction amount, net of existing equity stake | $ 5,800,000,000 | |||||
Loans Payable | ||||||
Short-term Debt [Line Items] | ||||||
Debt to capitalization percentage, maximum | 60.00% | |||||
Actual debt to capitalization percentage | 43.70% | |||||
Delayed Draw Term Loan May 2021 | Loans Payable | ||||||
Short-term Debt [Line Items] | ||||||
Aggregate principal | $ 500,000,000 | |||||
Proceeds from term loan | $ 500,000,000 | |||||
Delayed Draw Term Loan May 2021 | Loans Payable | LIBOR | ||||||
Short-term Debt [Line Items] | ||||||
Basis points spread on variable rate (percent) | 1.25% | |||||
Delayed Draw Term Loan May 2021 | Loans Payable | LIBOR | Minimum | ||||||
Short-term Debt [Line Items] | ||||||
Basis points spread on variable rate (percent) | 1.00% | |||||
Delayed Draw Term Loan May 2021 | Loans Payable | LIBOR | Maximum | ||||||
Short-term Debt [Line Items] | ||||||
Basis points spread on variable rate (percent) | 1.625% |
DEBT - Term Loan Agreement (Det
DEBT - Term Loan Agreement (Details) - USD ($) | Oct. 29, 2021 | May 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Short-term Debt [Line Items] | |||||
Repayment of term loan | $ 2,078,000,000 | $ 1,000,000,000 | $ 650,000,000 | ||
Revolving Credit Facility | |||||
Short-term Debt [Line Items] | |||||
Debt to capitalization percentage, maximum | 60.00% | ||||
Loans Payable | |||||
Short-term Debt [Line Items] | |||||
Debt to capitalization percentage, maximum | 60.00% | ||||
Actual debt to capitalization percentage | 43.70% | ||||
October 2021 Term Loan Agreement | Revolving Credit Facility | LIBOR | |||||
Short-term Debt [Line Items] | |||||
Basis points spread on variable rate (percent) | 1.125% | ||||
October 2021 Term Loan Agreement | Revolving Credit Facility | LIBOR | Minimum | |||||
Short-term Debt [Line Items] | |||||
Basis points spread on variable rate (percent) | 0.875% | ||||
October 2021 Term Loan Agreement | Revolving Credit Facility | LIBOR | Maximum | |||||
Short-term Debt [Line Items] | |||||
Basis points spread on variable rate (percent) | 1.375% | ||||
October 2021 Term Loan Agreement | Loans Payable | |||||
Short-term Debt [Line Items] | |||||
Aggregate principal | $ 2,000,000,000 | ||||
Gentiva Term Loan Due 2025 | Loans Payable | |||||
Short-term Debt [Line Items] | |||||
Repayment of term loan | $ 1,900,000,000 | ||||
Delayed Draw Term Loan May 2021 | Loans Payable | |||||
Short-term Debt [Line Items] | |||||
Aggregate principal | $ 500,000,000 | ||||
Delayed Draw Term Loan May 2021 | Loans Payable | LIBOR | |||||
Short-term Debt [Line Items] | |||||
Basis points spread on variable rate (percent) | 1.25% | ||||
Delayed Draw Term Loan May 2021 | Loans Payable | LIBOR | Minimum | |||||
Short-term Debt [Line Items] | |||||
Basis points spread on variable rate (percent) | 1.00% | ||||
Delayed Draw Term Loan May 2021 | Loans Payable | LIBOR | Maximum | |||||
Short-term Debt [Line Items] | |||||
Basis points spread on variable rate (percent) | 1.625% |
DEBT - Revolving Credit Agreeme
DEBT - Revolving Credit Agreements (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Jun. 30, 2021 | May 31, 2021 | Dec. 31, 2021 | |
Loans Payable | |||
Short-term Debt [Line Items] | |||
Debt to capitalization percentage, maximum | 60.00% | ||
Actual debt to capitalization percentage | 43.70% | ||
Delayed Draw Term Loan May 2021 | LIBOR | Loans Payable | |||
Short-term Debt [Line Items] | |||
Basis points spread on variable rate (percent) | 1.25% | ||
Delayed Draw Term Loan May 2021 | LIBOR | Minimum | Loans Payable | |||
Short-term Debt [Line Items] | |||
Basis points spread on variable rate (percent) | 1.00% | ||
Delayed Draw Term Loan May 2021 | LIBOR | Maximum | Loans Payable | |||
Short-term Debt [Line Items] | |||
Basis points spread on variable rate (percent) | 1.625% | ||
Revolving Credit Facility | |||
Short-term Debt [Line Items] | |||
Debt to capitalization percentage, maximum | 60.00% | ||
Uncommitted incremental loan facility | $ 750,000,000 | ||
Maximum borrowing capacity including uncommitted incremental loan facility | 4,750,000,000 | ||
Line of credit, outstanding borrowings | $ 0 | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 Five Year | |||
Short-term Debt [Line Items] | |||
Debt instrument term (in years) | 5 years | 5 years | |
Maximum borrowing capacity | $ 2,500,000,000 | ||
Facility fee (percent) | 0.15% | ||
Remaining borrowing capacity | $ 2,400,000,000 | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 Five Year | Minimum | |||
Short-term Debt [Line Items] | |||
Facility fee (percent) | 0.09% | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 Five Year | Maximum | |||
Short-term Debt [Line Items] | |||
Facility fee (percent) | 0.225% | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 Five Year | LIBOR | |||
Short-term Debt [Line Items] | |||
Basis points spread on variable rate (percent) | 1.10% | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 Five Year | LIBOR | Minimum | |||
Short-term Debt [Line Items] | |||
Basis points spread on variable rate (percent) | 0.91% | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 Five Year | LIBOR | Maximum | |||
Short-term Debt [Line Items] | |||
Basis points spread on variable rate (percent) | 1.40% | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 One Year | |||
Short-term Debt [Line Items] | |||
Debt instrument term (in years) | 364 days | 364 days | |
Maximum borrowing capacity | $ 1,500,000,000 | ||
Facility fee (percent) | 0.10% | ||
Remaining borrowing capacity | $ 1,500,000,000 | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 One Year | Minimum | |||
Short-term Debt [Line Items] | |||
Facility fee (percent) | 0.07% | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 One Year | Maximum | |||
Short-term Debt [Line Items] | |||
Facility fee (percent) | 0.175% | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 One Year | LIBOR | |||
Short-term Debt [Line Items] | |||
Basis points spread on variable rate (percent) | 1.15% | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 One Year | LIBOR | Minimum | |||
Short-term Debt [Line Items] | |||
Basis points spread on variable rate (percent) | 0.93% | ||
Revolving Credit Facility | Revolving Credit Agreement June 2021 One Year | LIBOR | Maximum | |||
Short-term Debt [Line Items] | |||
Basis points spread on variable rate (percent) | 1.45% | ||
Letter of Credit | |||
Short-term Debt [Line Items] | |||
Line of credit, outstanding borrowings | $ 75,000,000 |
DEBT - Commercial Paper (Detail
DEBT - Commercial Paper (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 10, 2022 | Dec. 31, 2020 | |
Commercial paper | |||
Short-term Debt [Line Items] | |||
Maximum borrowing capacity | $ 2,000,000,000 | ||
Maximum amount outstanding during period | 1,155,000,000 | ||
Short-term debt outstanding | $ 955,000,000 | $ 600,000,000 | |
Weighted average annual interest rate (percent) | 0.33% | ||
Commercial paper | Subsequent Event | |||
Short-term Debt [Line Items] | |||
Maximum borrowing capacity | $ 4,000,000,000 | ||
Federal Home Loan Bank Advances | |||
Short-term Debt [Line Items] | |||
Short-term debt outstanding | $ 0 |
EMPLOYEE BENEFIT PLANS - Narrat
EMPLOYEE BENEFIT PLANS - Narrative (Details) - USD ($) $ / shares in Units, shares in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee retirement and savings plan cost | $ 259,000,000 | $ 236,000,000 | $ 221,000,000 |
Company common stock closing price (in dollars per share) | $ 463.86 | ||
Plan assets invested in Company common stock (percent) | 9.00% | ||
Plan assets invested in Company common stock (in shares) | 1.4 | ||
Shares of common stock plan assets as percentage of shares outstanding | 1.10% | ||
Number of shares of common stock reserved for issuance under defined contribution retirement savings plan (in shares) | 1.1 | ||
Accelerated vesting, termination of employment period | 2 years | ||
Combination of age and years necessary for retirement provision as related to our equity award program | 65 years | ||
Minimum age required for retirement eligibility as related to our equity award program | 55 years | ||
Minimum number of years of service for retirement eligibility as related to our equity award program | 5 years | ||
Actual realized tax benefit on tax returns from option exercises and restricted stock vesting | $ 28,000,000 | 32,000,000 | 25,000,000 |
Capitalized stock-based compensation expense | 0 | 0 | 0 |
Fair value of shares vested | 236,000,000 | 191,000,000 | 141,000,000 |
Aggregate intrinsic value of stock options outstanding | $ 39,000,000 | ||
Weighted-average remaining contractual term of outstanding options (in years) | 4 years 9 months 18 days | ||
Aggregate intrinsic value of stock options exercisable | $ 17,000,000 | ||
Weighted-average remaining contractual term of exercisable options (in years) | 3 years 8 months 12 days | ||
Total intrinsic value of stock options exercised | $ 18,000,000 | 51,000,000 | 43,000,000 |
Proceeds from stock options exercised | $ 30,000,000 | $ 61,000,000 | $ 58,000,000 |
Restricted stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period (in years) | 3 years | ||
Weighted-average grant date fair value (in dollars per share) | $ 381.34 | $ 354.66 | $ 302.09 |
Percentage of restricted stock with performance-based conditions | 35.00% | ||
Total compensation expense not yet recognized related to nonvested awards | $ 192,000,000 | ||
Compensation expense recognition over a weighted-average period (in years) | 1 year 9 months 18 days | ||
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation expense not yet recognized related to nonvested awards | $ 9,000,000 | ||
Compensation expense recognition over a weighted-average period (in years) | 1 year 6 months | ||
Expiration period (in years) | 7 years | ||
Stock options | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period (in years) | 1 year | ||
Stock options | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period (in years) | 3 years | ||
2011 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock shares reserved for stock award plans (in shares) | 11.3 | ||
2011 Plan | Restricted stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for future grants assuming all stock options or restricted stock are granted (in shares) | 1.5 | ||
2011 Plan | Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for future grants assuming all stock options or restricted stock are granted (in shares) | 3.4 | ||
2019 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock shares reserved for stock award plans (in shares) | 15.7 | ||
2019 Plan | Restricted stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for future grants assuming all stock options or restricted stock are granted (in shares) | 3.8 | ||
2019 Plan | Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for future grants assuming all stock options or restricted stock are granted (in shares) | 12.6 |
EMPLOYEE BENEFIT PLANS - Stock-
EMPLOYEE BENEFIT PLANS - Stock-Based Compensation Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stock-based compensation expense [Line Items] | |||
Total stock-based compensation expense | $ 180 | $ 181 | $ 163 |
Tax benefit recognized | (15) | (29) | (35) |
Stock-based compensation expense, net of tax | 165 | 152 | 128 |
Restricted stock | |||
Stock-based compensation expense [Line Items] | |||
Total stock-based compensation expense | 171 | 171 | 152 |
Stock options | |||
Stock-based compensation expense [Line Items] | |||
Total stock-based compensation expense | $ 9 | $ 10 | $ 11 |
EMPLOYEE BENEFIT PLANS - Restri
EMPLOYEE BENEFIT PLANS - Restricted Stock Activity (Details) - Restricted stock - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Shares | |||
Nonvested restricted stock, beginning balance (in shares) | 911 | ||
Granted (in shares) | 485 | ||
Vested (in shares) | (460) | ||
Forfeited (in shares) | (63) | ||
Nonvested restricted stock, ending balance (in shares) | 873 | 911 | |
Weighted- Average Grant-Date Fair Value | |||
Nonvested restricted stock, beginning balance (in dollars per share) | $ 282.81 | ||
Granted (in dollars per share) | 381.34 | $ 354.66 | $ 302.09 |
Vested (in dollars per share) | 312.45 | ||
Forfeited (in dollars per share) | 347.42 | ||
Nonvested restricted stock, ending balance (in dollars per share) | $ 380.55 | $ 282.81 |
EMPLOYEE BENEFIT PLANS - Weight
EMPLOYEE BENEFIT PLANS - Weighted-Average Fair Value Assumptions for Stock Options (Details) - Stock options - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average fair value at grant date (in dollars per share) | $ 92.21 | $ 69.73 | $ 68.53 |
Expected option life (years) | 3 years 8 months 12 days | 4 years | 4 years 1 month 6 days |
Expected volatility | 33.80% | 24.90% | 25.50% |
Risk-free interest rate at grant date | 0.40% | 1.20% | 2.40% |
Dividend yield | 0.70% | 0.70% | 0.70% |
EMPLOYEE BENEFIT PLANS - Option
EMPLOYEE BENEFIT PLANS - Option Plans Activity (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2021$ / sharesshares | |
Shares Under Option | |
Options outstanding, beginning balance (in shares) | shares | 323 |
Granted (in shares) | shares | 93 |
Exercised (in shares) | shares | (106) |
Forfeited (in shares) | shares | 0 |
Options outstanding, ending balance (in shares) | shares | 310 |
Options exercisable, ending balance (in shares) | shares | 108 |
Weighted-Average Exercise Price | |
Options outstanding, beginning balance (in dollars per share) | $ / shares | $ 309.04 |
Granted (in dollars per share) | $ / shares | 379.26 |
Exercised (in dollars per share) | $ / shares | 282.35 |
Forfeited (in dollars per share) | $ / shares | 0 |
Options outstanding, ending balance (in dollars per share) | $ / shares | 339.08 |
Options exercisable, ending balance (in dollars per share) | $ / shares | $ 308.22 |
EARNINGS PER COMMON SHARE COM_3
EARNINGS PER COMMON SHARE COMPUTATION (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Net income available for common stockholders | $ 2,933 | $ 3,367 | $ 2,707 |
Weighted-average outstanding shares of common stock used to compute basic earnings per common share (in shares) | 128,688 | 132,199 | 134,055 |
Shares used to compute diluted earnings per common share (in shares) | 129,396 | 133,012 | 134,727 |
Basic earnings per common share (in dollars per share) | $ 22.79 | $ 25.47 | $ 20.20 |
Diluted earnings per common share (in dollars per share) | $ 22.67 | $ 25.31 | $ 20.10 |
Number of antidilutive stock options and restricted stock awards excluded from computation (in shares) | 216 | 238 | 478 |
Employee stock options | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Dilutive effect of employee stock options and restricted stock (in shares) | 64 | 92 | 107 |
Restricted stock | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Dilutive effect of employee stock options and restricted stock (in shares) | 644 | 721 | 565 |
STOCKHOLDERS' EQUITY - Dividend
STOCKHOLDERS' EQUITY - Dividend Payments (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Equity [Abstract] | |||
Amount per share (in dollars per share) | $ 2.73 | $ 2.43 | $ 2.15 |
Total Amount | $ 351 | $ 322 | $ 289 |
STOCKHOLDERS' EQUITY - Narrativ
STOCKHOLDERS' EQUITY - Narrative (Details) - USD ($) $ / shares in Units, shares in Thousands | Jan. 12, 2022 | May 05, 2021 | May 04, 2021 | Dec. 23, 2020 | Dec. 26, 2019 | Aug. 02, 2019 | Feb. 28, 2019 | Nov. 29, 2018 | Feb. 17, 2022 | Oct. 31, 2021 | Feb. 28, 2019 | May 05, 2021 | Dec. 26, 2019 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Jan. 11, 2022 | Feb. 18, 2021 | Dec. 22, 2020 | Jul. 31, 2019 | Jul. 30, 2019 | Nov. 28, 2018 | Dec. 14, 2017 |
Equity, Class of Treasury Stock [Line Items] | |||||||||||||||||||||||
Cash dividend declared (in dollars per share) | $ 0.70 | ||||||||||||||||||||||
Dividends paid | $ 90,000,000 | ||||||||||||||||||||||
Share repurchase authorization | $ 3,000,000,000 | $ 3,000,000,000 | $ 3,000,000,000 | ||||||||||||||||||||
Increase in treasury stock from share repurchases | $ 79,000,000 | $ 1,820,000,000 | $ 1,070,000,000 | ||||||||||||||||||||
Remaining share repurchase authorization at replacement | $ 250,000,000 | $ 1,030,000,000 | |||||||||||||||||||||
Common shares acquired in connection with employee stock plans (in shares) | 200 | 200 | 200 | ||||||||||||||||||||
Common shares acquired in connection with employee stock plans, amount | $ 79,000,000 | $ 70,000,000 | $ 70,000,000 | ||||||||||||||||||||
Aggregate statutory capital and surplus in our state regulated insurance subsidiaries | 9,600,000,000 | 9,400,000,000 | |||||||||||||||||||||
Aggregate minimum regulatory requirements of statutory capital and surplus | 7,600,000,000 | 7,000,000,000 | |||||||||||||||||||||
Ordinary dividends that may be paid to parent company | 1,500,000,000 | ||||||||||||||||||||||
Actual dividends paid to parent company | 1,600,000,000 | 1,300,000,000 | $ 1,800,000,000 | ||||||||||||||||||||
Noncontrolling interests | $ 23,000,000 | $ 0 | |||||||||||||||||||||
November 2018 ASR | |||||||||||||||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||||||||||||||
Accelerated share repurchase agreement amount | $ 750,000,000 | ||||||||||||||||||||||
Accelerated share repurchase payment | $ 750,000,000 | ||||||||||||||||||||||
Shares received (in shares) | 600 | 1,940 | 2,540 | ||||||||||||||||||||
Increase in treasury stock from share repurchases | $ 600,000,000 | ||||||||||||||||||||||
Decrease in capital in excess of par value | $ 150,000,000 | ||||||||||||||||||||||
Average daily volume weighted-average share price of common stock during term of agreement (in dollars per share) | $ 295.15 | ||||||||||||||||||||||
Reclassification from capital in excess of par value to treasury stock | $ 150,000,000 | ||||||||||||||||||||||
July 2019 ASR | |||||||||||||||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||||||||||||||
Accelerated share repurchase agreement amount | $ 1,000,000,000 | ||||||||||||||||||||||
Accelerated share repurchase payment | $ 1,000,000,000 | ||||||||||||||||||||||
Shares received (in shares) | 700 | 2,700 | 3,400 | ||||||||||||||||||||
Increase in treasury stock from share repurchases | $ 800,000,000 | ||||||||||||||||||||||
Decrease in capital in excess of par value | $ 200,000,000 | ||||||||||||||||||||||
Average daily volume weighted-average share price of common stock during term of agreement (in dollars per share) | $ 296.19 | ||||||||||||||||||||||
Reclassification from capital in excess of par value to treasury stock | $ 200,000,000 | ||||||||||||||||||||||
December 2020 ASR | |||||||||||||||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||||||||||||||
Accelerated share repurchase agreement amount | $ 1,750,000,000 | ||||||||||||||||||||||
Accelerated share repurchase payment | $ 1,750,000,000 | ||||||||||||||||||||||
Shares received (in shares) | 3,800 | 4,400 | |||||||||||||||||||||
Increase in treasury stock from share repurchases | $ 1,500,000,000 | ||||||||||||||||||||||
Decrease in capital in excess of par value | 262,500,000 | ||||||||||||||||||||||
Reclassification from capital in excess of par value to treasury stock | $ 262,500,000 | ||||||||||||||||||||||
December 2020 ASR | Citi | |||||||||||||||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||||||||||||||
Accelerated share repurchase payment | $ 875,000,000 | ||||||||||||||||||||||
Shares received (in shares) | 300 | 1,900 | |||||||||||||||||||||
Average daily volume weighted-average share price of common stock during term of agreement (in dollars per share) | $ 400.07 | ||||||||||||||||||||||
December 2020 ASR | JPM | |||||||||||||||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||||||||||||||
Accelerated share repurchase payment | $ 875,000,000 | ||||||||||||||||||||||
Shares received (in shares) | 300 | 1,900 | |||||||||||||||||||||
Average daily volume weighted-average share price of common stock during term of agreement (in dollars per share) | $ 401.49 | ||||||||||||||||||||||
Subsequent Event | |||||||||||||||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||||||||||||||
Cash dividend declared (in dollars per share) | $ 0.7875 | ||||||||||||||||||||||
Remaining authorized amount | $ 2,000,000,000 | ||||||||||||||||||||||
Subsequent Event | January 2022 ASR | |||||||||||||||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||||||||||||||
Accelerated share repurchase agreement amount | $ 1,000,000,000 | ||||||||||||||||||||||
Accelerated share repurchase payment | $ 1,000,000,000 | ||||||||||||||||||||||
Shares received (in shares) | 2,200 | ||||||||||||||||||||||
Increase in treasury stock from share repurchases | $ 850,000,000 | ||||||||||||||||||||||
Decrease in capital in excess of par value | 150,000,000 | ||||||||||||||||||||||
Subsequent Event | January 2022 ASR | Mizuho | |||||||||||||||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||||||||||||||
Accelerated share repurchase payment | $ 500,000,000 | ||||||||||||||||||||||
Shares received (in shares) | 1,080 | ||||||||||||||||||||||
Subsequent Event | January 2022 ASR | Wells Fargo | |||||||||||||||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||||||||||||||
Accelerated share repurchase payment | $ 500,000,000 | ||||||||||||||||||||||
Shares received (in shares) | 1,080 |
STOCKHOLDERS' EQUITY - Share Re
STOCKHOLDERS' EQUITY - Share Repurchases (Details) - USD ($) shares in Thousands | 12 Months Ended | |||||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Feb. 18, 2021 | Jul. 30, 2019 | Dec. 14, 2017 | |
Equity, Class of Treasury Stock [Line Items] | ||||||
Share repurchase authorization | $ 3,000,000,000 | $ 3,000,000,000 | $ 3,000,000,000 | |||
Cost of repurchases | $ 79,000,000 | $ 1,820,000,000 | $ 1,070,000,000 | |||
Excluding Employee Stock Plans and ASR | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Shares repurchased (in shares) | 0 | 3,800 | 3,400 | |||
Cost of repurchases | $ 0 | $ 1,750,000,000 | $ 1,000,000,000 | |||
February 2021 Authorization | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Share repurchase authorization | $ 3,000,000,000 | |||||
Shares repurchased (in shares) | 0 | 0 | 0 | |||
Cost of repurchases | $ 0 | $ 0 | $ 0 | |||
July 2019 Authorization | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Share repurchase authorization | $ 3,000,000,000 | |||||
Shares repurchased (in shares) | 0 | 3,800 | 3,400 | |||
Cost of repurchases | $ 0 | $ 1,750,000,000 | $ 1,000,000,000 |
COMMITMENTS, GUARANTEES AND C_2
COMMITMENTS, GUARANTEES AND CONTINGENCIES (Details) beneficiary in Millions, $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($)statebeneficiary | |
Loss Contingencies [Line Items] | |
Purchase obligations in 2022 | $ 656 |
Purchase obligations in 2023 | 310 |
Purchase obligations in 2024 | 192 |
Purchase obligations in 2025 | 97 |
Purchase obligations in 2026 | $ 52 |
Percentage of risk score calculated from claims submitted through EDS | 75.00% |
Number of states comprising TRICARE beneficiaries | state | 32 |
Number of TRICARE beneficiaries | beneficiary | 6,000,000 |
Medicare | |
Loss Contingencies [Line Items] | |
Percentage of premiums and services revenue | 82.00% |
Medicaid | |
Loss Contingencies [Line Items] | |
Percentage of premiums and services revenue | 6.00% |
Military services | |
Loss Contingencies [Line Items] | |
Percentage of premiums and services revenue | 1.00% |
Tricare East Region Contract | |
Loss Contingencies [Line Items] | |
Contract term years | 5 years |
SEGMENT INFORMATION - Narrative
SEGMENT INFORMATION - Narrative (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | segment | 3 | ||
Member co-share amounts and government subsidies | $ 18,100 | $ 16,500 | $ 14,900 |
Depreciation and amortization classified as benefit expense | $ 108 | $ 127 | $ 117 |
Government contracts concentration risk | Premiums and services revenue | Federal government contracts | |||
Segment Reporting Information [Line Items] | |||
Concentration risk (percent) | 83.00% | 83.00% | 82.00% |
SEGMENT INFORMATION - Segment R
SEGMENT INFORMATION - Segment Results (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | |||
Premiums | $ 79,822 | $ 74,186 | $ 62,948 |
Services revenue | 3,055 | 1,815 | 1,439 |
Total external revenues | 82,877 | 76,001 | 64,387 |
Total intersegment revenues | 0 | 0 | 0 |
Investment income | 187 | 1,154 | 501 |
Total revenues | 83,064 | 77,155 | 64,888 |
Benefits | 69,199 | 61,628 | 53,857 |
Operating costs | 10,121 | 10,052 | 7,381 |
Depreciation and amortization | 596 | 489 | 458 |
Total operating expenses | 79,916 | 72,169 | 61,696 |
Income (loss) from operations | 3,148 | 4,986 | 3,192 |
Interest expense | 326 | 283 | 242 |
Other (income) expense, net | (532) | 103 | (506) |
Income before income taxes and equity in net earnings | 3,354 | 4,600 | 3,456 |
Equity in net earnings | 65 | 74 | 14 |
Segment earnings | 3,419 | 4,674 | 3,470 |
Less: noncontrolling interests | (1) | ||
Segment earnings attributable to Humana | 3,418 | ||
Individual Medicare Advantage | |||
Segment Reporting Information [Line Items] | |||
Premiums | 58,654 | 51,697 | 43,128 |
Group Medicare Advantage | |||
Segment Reporting Information [Line Items] | |||
Premiums | 6,955 | 7,774 | 6,475 |
Medicare stand-alone PDP | |||
Segment Reporting Information [Line Items] | |||
Premiums | 2,371 | 2,742 | 3,165 |
Total Medicare | |||
Segment Reporting Information [Line Items] | |||
Premiums | 67,980 | 62,213 | 52,768 |
Fully-insured | |||
Segment Reporting Information [Line Items] | |||
Premiums | 5,002 | 6,051 | 5,711 |
Specialty | |||
Segment Reporting Information [Line Items] | |||
Premiums | 1,731 | 1,699 | 1,571 |
Medicaid and other | |||
Segment Reporting Information [Line Items] | |||
Premiums | 5,109 | 4,223 | 2,898 |
Home Solutions | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 1,166 | 107 | 140 |
Provider | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 413 | 328 | 306 |
ASO and other | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 839 | 799 | 807 |
Pharmacy | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 637 | 581 | 186 |
Services | |||
Segment Reporting Information [Line Items] | |||
Total intersegment revenues | 0 | 0 | 0 |
Products | |||
Segment Reporting Information [Line Items] | |||
Total intersegment revenues | 0 | 0 | 0 |
Operating Segments | Retail | |||
Segment Reporting Information [Line Items] | |||
Premiums | 73,820 | 67,124 | 56,254 |
Services revenue | 23 | 19 | 17 |
Total external revenues | 73,843 | 67,143 | 56,271 |
Total intersegment revenues | 1 | 0 | 0 |
Investment income | 200 | 155 | 195 |
Total revenues | 74,044 | 67,298 | 56,466 |
Benefits | 64,907 | 56,537 | 48,602 |
Operating costs | 6,764 | 7,402 | 5,306 |
Depreciation and amortization | 436 | 342 | 323 |
Total operating expenses | 72,107 | 64,281 | 54,231 |
Income (loss) from operations | 1,937 | 3,017 | 2,235 |
Interest expense | 0 | 0 | 0 |
Other (income) expense, net | 0 | 0 | 0 |
Income before income taxes and equity in net earnings | 1,937 | 3,017 | 2,235 |
Equity in net earnings | 0 | 0 | 0 |
Segment earnings | 1,937 | 3,017 | 2,235 |
Less: noncontrolling interests | 0 | ||
Segment earnings attributable to Humana | 1,937 | ||
Operating Segments | Retail | Individual Medicare Advantage | |||
Segment Reporting Information [Line Items] | |||
Premiums | 58,654 | 51,697 | 43,128 |
Operating Segments | Retail | Group Medicare Advantage | |||
Segment Reporting Information [Line Items] | |||
Premiums | 6,955 | 7,774 | 6,475 |
Operating Segments | Retail | Medicare stand-alone PDP | |||
Segment Reporting Information [Line Items] | |||
Premiums | 2,371 | 2,742 | 3,165 |
Operating Segments | Retail | Total Medicare | |||
Segment Reporting Information [Line Items] | |||
Premiums | 67,980 | 62,213 | 52,768 |
Operating Segments | Retail | Fully-insured | |||
Segment Reporting Information [Line Items] | |||
Premiums | 731 | 688 | 588 |
Operating Segments | Retail | Specialty | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Retail | Medicaid and other | |||
Segment Reporting Information [Line Items] | |||
Premiums | 5,109 | 4,223 | 2,898 |
Operating Segments | Retail | Home Solutions | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Operating Segments | Retail | Provider | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Operating Segments | Retail | ASO and other | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 23 | 19 | 17 |
Operating Segments | Retail | Pharmacy | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Operating Segments | Retail | Services | |||
Segment Reporting Information [Line Items] | |||
Total intersegment revenues | 1 | 0 | 0 |
Operating Segments | Retail | Products | |||
Segment Reporting Information [Line Items] | |||
Total intersegment revenues | 0 | 0 | 0 |
Operating Segments | Group and Specialty | |||
Segment Reporting Information [Line Items] | |||
Premiums | 6,002 | 6,460 | 6,694 |
Services revenue | 816 | 780 | 790 |
Total external revenues | 6,818 | 7,240 | 7,484 |
Total intersegment revenues | 40 | 29 | 18 |
Investment income | 14 | 16 | 23 |
Total revenues | 6,872 | 7,285 | 7,525 |
Benefits | 4,951 | 5,529 | 5,758 |
Operating costs | 1,687 | 1,818 | 1,651 |
Depreciation and amortization | 85 | 81 | 88 |
Total operating expenses | 6,723 | 7,428 | 7,497 |
Income (loss) from operations | 149 | (143) | 28 |
Interest expense | 0 | 0 | 0 |
Other (income) expense, net | 0 | 0 | 0 |
Income before income taxes and equity in net earnings | 149 | (143) | 28 |
Equity in net earnings | 0 | 0 | 0 |
Segment earnings | 149 | (143) | 28 |
Less: noncontrolling interests | 0 | ||
Segment earnings attributable to Humana | 149 | ||
Operating Segments | Group and Specialty | Individual Medicare Advantage | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Group and Specialty | Group Medicare Advantage | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Group and Specialty | Medicare stand-alone PDP | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Group and Specialty | Total Medicare | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Group and Specialty | Fully-insured | |||
Segment Reporting Information [Line Items] | |||
Premiums | 4,271 | 4,761 | 5,123 |
Operating Segments | Group and Specialty | Specialty | |||
Segment Reporting Information [Line Items] | |||
Premiums | 1,731 | 1,699 | 1,571 |
Operating Segments | Group and Specialty | Medicaid and other | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Group and Specialty | Home Solutions | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Operating Segments | Group and Specialty | Provider | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Operating Segments | Group and Specialty | ASO and other | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 816 | 780 | 790 |
Operating Segments | Group and Specialty | Pharmacy | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Operating Segments | Group and Specialty | Services | |||
Segment Reporting Information [Line Items] | |||
Total intersegment revenues | 40 | 29 | 18 |
Operating Segments | Group and Specialty | Products | |||
Segment Reporting Information [Line Items] | |||
Total intersegment revenues | 0 | 0 | 0 |
Operating Segments | Healthcare Services | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Services revenue | 2,216 | 1,016 | 632 |
Total external revenues | 2,216 | 1,016 | 632 |
Total intersegment revenues | 29,022 | 27,419 | 25,149 |
Investment income | 4 | 13 | 2 |
Total revenues | 31,242 | 28,448 | 25,783 |
Benefits | 0 | 0 | 0 |
Operating costs | 29,801 | 27,395 | 24,852 |
Depreciation and amortization | 177 | 183 | 156 |
Total operating expenses | 29,978 | 27,578 | 25,008 |
Income (loss) from operations | 1,264 | 870 | 775 |
Interest expense | 0 | 0 | 0 |
Other (income) expense, net | 0 | 0 | 0 |
Income before income taxes and equity in net earnings | 1,264 | 870 | 775 |
Equity in net earnings | 65 | 74 | 14 |
Segment earnings | 1,329 | 944 | 789 |
Less: noncontrolling interests | (1) | ||
Segment earnings attributable to Humana | 1,328 | ||
Operating Segments | Healthcare Services | Individual Medicare Advantage | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Healthcare Services | Group Medicare Advantage | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Healthcare Services | Medicare stand-alone PDP | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Healthcare Services | Total Medicare | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Healthcare Services | Fully-insured | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Healthcare Services | Specialty | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Healthcare Services | Medicaid and other | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Operating Segments | Healthcare Services | Home Solutions | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 1,166 | 107 | 140 |
Operating Segments | Healthcare Services | Provider | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 413 | 328 | 306 |
Operating Segments | Healthcare Services | ASO and other | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Operating Segments | Healthcare Services | Pharmacy | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 637 | 581 | 186 |
Operating Segments | Healthcare Services | Services | |||
Segment Reporting Information [Line Items] | |||
Total intersegment revenues | 19,998 | 19,491 | 18,255 |
Operating Segments | Healthcare Services | Products | |||
Segment Reporting Information [Line Items] | |||
Total intersegment revenues | 9,024 | 7,928 | 6,894 |
Eliminations/ Corporate | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 602 | 0 |
Services revenue | 0 | 0 | 0 |
Total external revenues | 0 | 602 | 0 |
Total intersegment revenues | (29,063) | (27,448) | (25,167) |
Investment income | (31) | 970 | 281 |
Total revenues | (29,094) | (25,876) | (24,886) |
Benefits | (659) | (438) | (503) |
Operating costs | (28,131) | (26,563) | (24,428) |
Depreciation and amortization | (102) | (117) | (109) |
Total operating expenses | (28,892) | (27,118) | (25,040) |
Income (loss) from operations | (202) | 1,242 | 154 |
Interest expense | 326 | 283 | 242 |
Other (income) expense, net | (532) | 103 | (506) |
Income before income taxes and equity in net earnings | 4 | 856 | 418 |
Equity in net earnings | 0 | 0 | 0 |
Segment earnings | 4 | 856 | 418 |
Less: noncontrolling interests | 0 | ||
Segment earnings attributable to Humana | 4 | ||
Eliminations/ Corporate | Individual Medicare Advantage | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Eliminations/ Corporate | Group Medicare Advantage | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Eliminations/ Corporate | Medicare stand-alone PDP | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Eliminations/ Corporate | Total Medicare | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Eliminations/ Corporate | Fully-insured | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 602 | 0 |
Eliminations/ Corporate | Specialty | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Eliminations/ Corporate | Medicaid and other | |||
Segment Reporting Information [Line Items] | |||
Premiums | 0 | 0 | 0 |
Eliminations/ Corporate | Home Solutions | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Eliminations/ Corporate | Provider | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Eliminations/ Corporate | ASO and other | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Eliminations/ Corporate | Pharmacy | |||
Segment Reporting Information [Line Items] | |||
Services revenue | 0 | 0 | 0 |
Eliminations/ Corporate | Services | |||
Segment Reporting Information [Line Items] | |||
Total intersegment revenues | (20,039) | (19,520) | (18,273) |
Eliminations/ Corporate | Products | |||
Segment Reporting Information [Line Items] | |||
Total intersegment revenues | $ (9,024) | $ (7,928) | $ (6,894) |
REINSURANCE (Details)
REINSURANCE (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021USD ($)reinsurer | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Effects of Reinsurance [Line Items] | |||
Reinsurance recoverables | $ 188 | $ 194 | |
Premiums ceded | 6 | 29 | $ 1,000 |
Benefits ceded | $ 2 | 7 | $ 881 |
Number of reinsurers comprising other reinsurance recoverables balance | reinsurer | 10 | ||
Cash and securities in trusts held by certain reinsurers | $ 2 | ||
Protective Life Insurance Company | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance recoverables | 169 | ||
All others | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance recoverables | $ 19 | ||
100% coinsurance agreements | |||
Effects of Reinsurance [Line Items] | |||
Percentage of coinsurance agreement | 100.00% | ||
Reinsurance recoverables | Reinsurer concentration risk | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance recoverables | $ 188 | $ 193 |
SCHEDULE I - PARENT COMPANY F_2
SCHEDULE I - PARENT COMPANY FINANCIAL INFORMATION (Condensed Balance Sheets) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 3,394 | $ 4,673 |
Investment securities | 13,192 | 12,554 |
Other current assets | 6,493 | 5,276 |
Total current assets | 24,893 | 23,641 |
Property and equipment, net | 3,073 | 2,371 |
Equity method investments | 141 | 1,170 |
Long-term investment securities | 780 | 1,212 |
Other long-term assets | 4,379 | 2,128 |
Total assets | 44,358 | 34,969 |
Current liabilities: | ||
Book overdraft | 326 | 320 |
Short-term debt | 1,953 | 600 |
Total current liabilities | 15,331 | 13,394 |
Long-term debt | 10,541 | 6,060 |
Other long-term liabilities | 2,383 | 1,787 |
Total liabilities | 28,255 | 21,241 |
Commitments and contingencies (Note 17) | ||
Stockholders’ equity: | ||
Preferred stock, $1 par; 10,000,000 shares authorized; none issued | 0 | 0 |
Common stock, $0.16 2/3 par; 300,000,000 shares authorized; 198,648,742 shares issued at December 31, 2021 and December 31, 2020 | 33 | 33 |
Capital in excess of par value | 3,082 | 2,705 |
Retained earnings | 23,086 | 20,517 |
Accumulated other comprehensive income | 42 | 391 |
Treasury stock, at cost, 69,846,758 shares at December 31, 2021 and 69,787,914 shares at December 31, 2020 | (10,163) | (9,918) |
Total liabilities and stockholders’ equity | 44,358 | 34,969 |
Parent Company | ||
Current assets: | ||
Cash and cash equivalents | 906 | 436 |
Investment securities | 428 | 336 |
Receivable from operating subsidiaries | 1,316 | 1,187 |
Other current assets | 545 | 763 |
Total current assets | 3,195 | 2,722 |
Property and equipment, net | 2,223 | 1,774 |
Investments in subsidiaries | 26,885 | 17,005 |
Equity method investments | 52 | 1,147 |
Long-term investment securities | 207 | 836 |
Other long-term assets | 407 | 686 |
Total assets | 32,969 | 24,170 |
Current liabilities: | ||
Payable to operating subsidiaries | 2,056 | 1,342 |
Current portion of notes payable to operating subsidiaries | 36 | 36 |
Book overdraft | 68 | 120 |
Short-term debt | 1,953 | 600 |
Other current liabilities | 1,460 | 1,438 |
Total current liabilities | 5,573 | 3,536 |
Long-term debt | 10,541 | 6,060 |
Other long-term liabilities | 775 | 846 |
Total liabilities | 16,889 | 10,442 |
Commitments and contingencies (Note 17) | ||
Stockholders’ equity: | ||
Preferred stock, $1 par; 10,000,000 shares authorized; none issued | 0 | 0 |
Common stock, $0.16 2/3 par; 300,000,000 shares authorized; 198,648,742 shares issued at December 31, 2021 and December 31, 2020 | 33 | 33 |
Capital in excess of par value | 3,082 | 2,705 |
Retained earnings | 23,086 | 20,517 |
Accumulated other comprehensive income | 42 | 391 |
Treasury stock, at cost, 69,846,758 shares at December 31, 2021 and 69,787,914 shares at December 31, 2020 | (10,163) | (9,918) |
Total stockholders’ equity | 16,080 | 13,728 |
Total liabilities and stockholders’ equity | $ 32,969 | $ 24,170 |
SCHEDULE I - PARENT COMPANY F_3
SCHEDULE I - PARENT COMPANY FINANCIAL INFORMATION (Condensed Balance Sheets Share Data) (Details) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Condensed Financial Statements, Captions [Line Items] | ||
Preferred stock, par (in dollars per share) | $ 1 | $ 1 |
Preferred stock, authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par (in dollars per share) | $ 0.1667 | $ 0.1667 |
Common stock, authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, issued (in shares) | 198,648,742 | 198,648,742 |
Treasury stock (in shares) | 69,846,758 | 69,787,914 |
Parent Company | ||
Condensed Financial Statements, Captions [Line Items] | ||
Preferred stock, par (in dollars per share) | $ 1 | $ 1 |
Preferred stock, authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par (in dollars per share) | $ 0.1667 | $ 0.1667 |
Common stock, authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, issued (in shares) | 198,648,742 | 198,648,742 |
Treasury stock (in shares) | 69,846,758 | 69,787,914 |
SCHEDULE I - PARENT COMPANY F_4
SCHEDULE I - PARENT COMPANY FINANCIAL INFORMATION (Condensed Statements of Income) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues: | |||
Total revenues | $ 83,064 | $ 77,155 | $ 64,888 |
Expenses: | |||
Operating costs | 10,121 | 10,052 | 7,381 |
Depreciation | 640 | 528 | 505 |
Interest | 326 | 283 | 242 |
Other (income) expense, net | (532) | 103 | (506) |
(Benefit) provision for income taxes | 485 | 1,307 | 763 |
Equity in net earnings | 65 | 74 | 14 |
Net income (loss) | 2,933 | 3,367 | 2,707 |
Parent Company | |||
Revenues: | |||
Management fees charged to operating subsidiaries | 1,633 | 2,216 | 1,789 |
Investment and other (loss) income, net | (266) | 763 | 28 |
Total revenues | 1,367 | 2,979 | 1,817 |
Expenses: | |||
Operating costs | 1,404 | 2,204 | 1,577 |
Depreciation | 488 | 397 | 387 |
Interest | 313 | 283 | 242 |
Total operating expenses | 2,205 | 2,884 | 2,206 |
Other (income) expense, net | (672) | 60 | (506) |
(Loss) income before income taxes and equity in net earnings of subsidiaries | (166) | 35 | 117 |
(Benefit) provision for income taxes | (259) | 18 | 27 |
Income before equity in net earnings of subsidiaries | 93 | 17 | 90 |
Equity in net earnings of subsidiaries | 2,761 | 3,269 | 2,603 |
Equity in net earnings | 79 | 81 | 14 |
Net income (loss) | $ 2,933 | $ 3,367 | $ 2,707 |
SCHEDULE I - PARENT COMPANY F_5
SCHEDULE I - PARENT COMPANY FINANCIAL INFORMATION (Condensed Statements of Comprehensive Income) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Condensed Financial Statements, Captions [Line Items] | |||
Net income attributable to Humana | $ 2,933 | $ 3,367 | $ 2,707 |
Other comprehensive income (loss): | |||
Change in gross unrealized investment (losses) gains | (356) | 393 | 450 |
Effect of income taxes | 81 | (89) | (105) |
Total change in unrealized investment (losses) gains, net of tax | (275) | 304 | 345 |
Reclassification adjustment for net realized gains included in investment income | (103) | (90) | (34) |
Effect of income taxes | 23 | 20 | 8 |
Total reclassification adjustment, net of tax | (80) | (70) | (26) |
Other comprehensive (loss) income, net of tax | (355) | 234 | 319 |
Comprehensive income (loss) attributable to our equity method investment in Kindred at Home | 6 | 1 | (4) |
Comprehensive income | 2,584 | 3,602 | 3,022 |
Parent Company | |||
Condensed Financial Statements, Captions [Line Items] | |||
Net income attributable to Humana | 2,933 | 3,367 | 2,707 |
Other comprehensive income (loss): | |||
Change in gross unrealized investment (losses) gains | (356) | 393 | 450 |
Effect of income taxes | 81 | (89) | (105) |
Total change in unrealized investment (losses) gains, net of tax | (275) | 304 | 345 |
Reclassification adjustment for net realized gains included in investment income | (103) | (90) | (34) |
Effect of income taxes | 23 | 20 | 8 |
Total reclassification adjustment, net of tax | (80) | (70) | (26) |
Other comprehensive (loss) income, net of tax | (355) | 234 | 319 |
Comprehensive income (loss) attributable to our equity method investment in Kindred at Home | 6 | 1 | (4) |
Comprehensive income | $ 2,584 | $ 3,602 | $ 3,022 |
SCHEDULE I - PARENT COMPANY F_6
SCHEDULE I - PARENT COMPANY FINANCIAL INFORMATION (Condensed Statements of Cash Flows) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Condensed Financial Statements, Captions [Line Items] | |||
Net cash provided by operating activities | $ 2,262 | $ 5,639 | $ 5,284 |
Cash flows from investing activities: | |||
Acquisitions, net of cash and cash equivalents acquired | (4,187) | (709) | 0 |
Purchases of investment securities | (7,197) | (9,125) | (6,361) |
Proceeds from sale of investment securities | 3,547 | 2,747 | 4,086 |
Proceeds from maturities of investment securities | 2,597 | 4,986 | 1,733 |
Purchases of property and equipment, net | (1,316) | (964) | (736) |
Net cash used in investing activities | (6,556) | (3,065) | (1,278) |
Cash flows from financing activities: | |||
Proceeds from issuance of senior notes, net | 2,984 | 1,088 | 987 |
Repayment of senior notes | 0 | (400) | (400) |
Proceeds (repayments) from issuance of commercial paper, net | 352 | 295 | (360) |
Proceeds from term loan | 2,500 | 1,000 | 0 |
Repayment of term loan | (2,078) | (1,000) | (650) |
Change in book overdraft | 6 | 95 | 54 |
Common stock repurchases | (79) | (1,820) | (1,070) |
Dividends paid | (354) | (323) | (291) |
Proceeds from stock option exercises & other | 21 | 49 | 58 |
Net cash provided by (used in) financing activities | 3,015 | (1,955) | (2,295) |
(Decrease) increase in cash and cash equivalents | (1,279) | 619 | 1,711 |
Cash and cash equivalents at beginning of period | 4,673 | 4,054 | 2,343 |
Cash and cash equivalents at end of period | 3,394 | 4,673 | 4,054 |
Parent Company | |||
Condensed Financial Statements, Captions [Line Items] | |||
Net cash provided by operating activities | 2,853 | 2,531 | 3,529 |
Cash flows from investing activities: | |||
Acquisitions, net of cash and cash equivalents acquired | (4,187) | (709) | 0 |
Capital contributions to operating subsidiaries | (2,580) | (538) | (423) |
Purchases of investment securities | (200) | (460) | (204) |
Proceeds from sale of investment securities | 71 | 13 | 15 |
Proceeds from maturities of investment securities | 122 | 411 | 134 |
Purchases of property and equipment, net | (958) | (785) | (585) |
Net cash used in investing activities | (7,732) | (2,068) | (1,063) |
Cash flows from financing activities: | |||
Proceeds from issuance of senior notes, net | 2,953 | 1,088 | 987 |
Repayment of senior notes | 0 | (400) | (400) |
Proceeds (repayments) from issuance of commercial paper, net | 352 | 295 | (360) |
Proceeds from term loan | 2,500 | 1,000 | 0 |
Repayment of term loan | 0 | (1,000) | (650) |
Change in book overdraft | (52) | 80 | 2 |
Common stock repurchases | (79) | (1,820) | (1,070) |
Dividends paid | (354) | (323) | (291) |
Proceeds from stock option exercises & other | 29 | 47 | 57 |
Net cash provided by (used in) financing activities | 5,349 | (1,033) | (1,725) |
(Decrease) increase in cash and cash equivalents | 470 | (570) | 741 |
Cash and cash equivalents at beginning of period | 436 | 1,006 | 265 |
Cash and cash equivalents at end of period | $ 906 | $ 436 | $ 1,006 |
SCHEDULE I - PARENT COMPANY F_7
SCHEDULE I - PARENT COMPANY FINANCIAL INFORMATION (Notes to Condensed Financial Statements) (Details) - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Condensed Financial Information Disclosure [Abstract] | |||
Actual dividends paid to parent company | $ 1.6 | $ 1.3 | $ 1.8 |
Aggregate statutory capital and surplus in our state regulated insurance subsidiaries | 9.6 | 9.4 | |
Aggregate minimum regulatory requirements of statutory capital and surplus | 7.6 | $ 7 | |
Ordinary dividends that may be paid to parent company | $ 1.5 |
SCHEDULE II - VALUATION AND Q_2
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Allowance for loss on receivables: | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | $ 72 | $ 69 | $ 79 |
Charged (Credited) to Costs and Expenses | 21 | 36 | (1) |
Charged to other accounts | (3) | (1) | 0 |
Deductions or Write-offs | (7) | (32) | (9) |
Balance at End of Period | 83 | 72 | 69 |
Deferred tax asset valuation allowance: | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 37 | 45 | 54 |
Charged (Credited) to Costs and Expenses | (28) | 8 | 9 |
Charged to other accounts | 0 | 0 | 0 |
Deductions or Write-offs | 0 | 0 | 0 |
Balance at End of Period | $ 65 | $ 37 | $ 45 |