Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 17, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-31826 | |
Entity Registrant Name | CENTENE CORPORATION | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 42-1406317 | |
Entity Address, Address Line One | 7700 Forsyth Boulevard | |
Entity Address, City or Town | St. Louis, | |
Entity Address, State or Province | MO | |
Entity Address, Postal Zip Code | 63105 | |
City Area Code | 314 | |
Local Phone Number | 725-4477 | |
Title of 12(b) Security | Common Stock $0.001 Par Value | |
Trading Symbol | CNC | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 579,129,418 | |
Entity Central Index Key | 0001071739 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 9,308 | $ 12,123 |
Premium and trade receivables | 11,304 | 6,247 |
Short-term investments | 1,386 | 863 |
Other current assets | 2,698 | 1,090 |
Total current assets | 24,696 | 20,323 |
Long-term investments | 10,521 | 7,717 |
Restricted deposits | 1,014 | 658 |
Property, software and equipment, net | 2,439 | 2,121 |
Goodwill | 17,417 | 6,863 |
Intangible assets, net | 8,898 | 2,063 |
Other long-term assets | 1,446 | 1,249 |
Total assets | 66,431 | 40,994 |
Current liabilities: | ||
Medical claims liability | 11,413 | 7,473 |
Accounts payable and accrued expenses | 8,531 | 4,164 |
Return of premium payable | 1,052 | 824 |
Unearned revenue | 526 | 383 |
Current portion of long-term debt | 129 | 88 |
Total current liabilities | 21,651 | 12,932 |
Long-term debt | 17,150 | 13,638 |
Other long-term liabilities | 3,938 | 1,732 |
Total liabilities | 42,739 | 28,302 |
Commitments and contingencies | ||
Redeemable noncontrolling interests | 36 | 33 |
Stockholders’ equity: | ||
Preferred stock, $0.001 par value; authorized 10,000 shares; no shares issued or outstanding at March 31, 2020 and December 31, 2019 | 0 | 0 |
Common stock, $0.001 par value; authorized 800,000 shares; 594,890 issued and 579,122 outstanding at March 31, 2020, and 421,508 issued and 415,048 outstanding at December 31, 2019 | 0 | 0 |
Additional paid-in capital | 19,279 | 7,647 |
Accumulated other comprehensive earnings (loss) | (5) | 134 |
Retained earnings | 5,030 | 4,984 |
Treasury stock, at cost (15,768 and 6,460 shares, respectively) | (755) | (214) |
Total Centene stockholders’ equity | 23,549 | 12,551 |
Nonredeemable Noncontrolling interest | 107 | 108 |
Total stockholders’ equity | 23,656 | 12,659 |
Total liabilities, redeemable noncontrolling interests and stockholders’ equity | $ 66,431 | $ 40,994 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Stockholders' equity | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 800,000,000 | 800,000,000 |
Common stock, shares issued (in shares) | 594,890,000 | 421,508,000 |
Common stock, shares outstanding (in shares) | 579,122,000 | 415,048,000 |
Treasury stock (in shares) | 15,768,000 | 6,460,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues: | ||
Premium and service revenues | $ 24,172 | $ 16,838 |
Premium tax and health insurer fee | 1,853 | 1,606 |
Total revenues | 26,025 | 18,444 |
Expenses: | ||
Medical costs | 20,420 | 13,882 |
Cost of services | 825 | 544 |
Selling, general and administrative expenses | 2,384 | 1,609 |
Amortization of acquired intangible assets | 166 | 65 |
Premium tax expense | 1,625 | 1,659 |
Health insurer fee expense | 345 | 0 |
Impairment | 72 | 0 |
Total operating expenses | 25,837 | 17,759 |
Earnings from operations | 188 | 685 |
Other income (expense): | ||
Investment and other income | 167 | 99 |
Debt extinguishment costs | (44) | 0 |
Interest expense | (180) | (99) |
Earnings from operations, before income tax expense | 131 | 685 |
Income tax expense | 85 | 166 |
Net earnings | 46 | 519 |
Loss attributable to noncontrolling interests | 0 | 3 |
Net earnings attributable to Centene Corporation | $ 46 | $ 522 |
Net earnings per common share attributable to Centene Corporation: | ||
Basic earnings per common share (in dollars per share) | $ 0.08 | $ 1.26 |
Diluted earnings per common share (in dollars per share) | $ 0.08 | $ 1.24 |
Weighted average number of common shares outstanding: | ||
Basic (in shares) | 544,436 | 412,924 |
Diluted (in shares) | 552,062 | 419,752 |
Premium | ||
Revenues: | ||
Premium and service revenues | $ 23,214 | $ 16,203 |
Service | ||
Revenues: | ||
Premium and service revenues | $ 958 | $ 635 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (LOSS) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net earnings | $ 46 | $ 519 |
Change in unrealized gain on investments, net of tax | (134) | 94 |
Defined benefit pension plan net gain, net of tax | 2 | 0 |
Foreign currency translation adjustments | (7) | 0 |
Other comprehensive earnings (loss) | (139) | 94 |
Comprehensive earnings (loss) | (93) | 613 |
Comprehensive (earnings) loss attributable to noncontrolling interests | 0 | 3 |
Comprehensive earnings (loss) attributable to Centene Corporation | $ (93) | $ 616 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Millions | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Treasury Stock | Non-redeemable Non- controlling Interest |
Balance (in shares) at Dec. 31, 2018 | 417,695 | ||||||
Balance at Dec. 31, 2018 | $ 11,013 | $ 0 | $ 7,449 | $ (56) | $ 3,663 | $ (139) | $ 96 |
Treasury stock (in shares) at Dec. 31, 2018 | 5,217 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net earnings (loss) | 520 | 522 | (2) | ||||
Other comprehensive earnings (loss), net of tax | 94 | 94 | |||||
Common stock issued for employee benefit plans (in shares) | 1,363 | ||||||
Common stock issued for employee benefit plans | 4 | 4 | |||||
Common stock repurchases (in shares) | 536 | ||||||
Common stock repurchases | (35) | $ (35) | |||||
Stock compensation expense | 38 | 38 | |||||
Balance (in shares) at Mar. 31, 2019 | 419,058 | ||||||
Balance at Mar. 31, 2019 | $ 11,634 | $ 0 | 7,491 | 38 | 4,185 | $ (174) | 94 |
Treasury stock (in shares) at Mar. 31, 2019 | 5,753 | ||||||
Balance (in shares) at Dec. 31, 2019 | 415,048 | 421,508 | |||||
Balance at Dec. 31, 2019 | $ 12,659 | $ 0 | 7,647 | 134 | 4,984 | $ (214) | 108 |
Treasury stock (in shares) at Dec. 31, 2019 | 6,460 | 6,460 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net earnings (loss) | $ 43 | 46 | (3) | ||||
Other comprehensive earnings (loss), net of tax | (139) | (139) | |||||
Common stock issued for acquisitions (in shares) | 171,225 | ||||||
Common stock issued for acquisitions | 11,526 | $ 0 | 11,526 | ||||
Common stock issued for employee benefit plans (in shares) | 2,448 | ||||||
Common stock issued for employee benefit plans | 5 | 5 | |||||
Common stock repurchases (in shares) | 291 | 9,308 | |||||
Common stock repurchases | (558) | (17) | $ (541) | ||||
Stock compensation expense | 117 | 117 | |||||
Contribution from noncontrolling interest | 2 | 2 | |||||
Other | $ 1 | 1 | 0 | ||||
Balance (in shares) at Mar. 31, 2020 | 579,122 | 594,890 | |||||
Balance at Mar. 31, 2020 | $ 23,656 | $ 0 | $ 19,279 | $ (5) | $ 5,030 | $ (755) | $ 107 |
Treasury stock (in shares) at Mar. 31, 2020 | 15,768 | 15,768 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Par value (in dollars per share) | $ 0.001 | $ 0.001 | ||
Other comprehensive earning (loss), tax (benefit) | $ 40 | $ 30 | ||
Common Stock | ||||
Par value (in dollars per share) | $ 0.001 | $ 0.001 | 0.001 | $ 0.001 |
Treasury Stock | ||||
Par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net earnings | $ 46 | $ 519 |
Adjustments to reconcile net earnings to net cash provided by operating activities | ||
Depreciation and amortization | 288 | 155 |
Stock compensation expense | 117 | 38 |
Impairment | 72 | 0 |
Loss on debt extinguishment | 44 | 0 |
Deferred income taxes | 112 | 23 |
Gain on divestiture | (93) | 0 |
Other adjustments, net | 24 | (11) |
Changes in assets and liabilities | ||
Premium and trade receivables | (2,182) | (662) |
Other assets | 97 | 20 |
Medical claims liabilities | 252 | 548 |
Unearned revenue | (88) | (22) |
Accounts payable and accrued expenses | 704 | 357 |
Other long-term liabilities | 361 | 347 |
Other operating activities, net | 6 | 4 |
Net cash (used in) provided by operating activities | (240) | 1,316 |
Cash flows from investing activities: | ||
Capital expenditures | (177) | (176) |
Purchases of investments | (1,400) | (580) |
Sales and maturities of investments | 902 | 383 |
Acquisitions, net of cash acquired | (3,048) | 0 |
Divestiture proceeds, net of divested cash | 456 | 0 |
Other investing activities, net | (5) | 0 |
Net cash used in investing activities | (3,272) | (373) |
Cash flows from financing activities: | ||
Proceeds from long-term debt | 2,542 | 1,018 |
Payments of long-term debt | (1,039) | (927) |
Common stock repurchases | (558) | (35) |
Payments for debt extinguishment | (21) | 0 |
Debt issuance costs | (92) | 0 |
Other financing activities, net | 7 | 2 |
Net cash provided by financing activities | 839 | 58 |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (1) | 0 |
Net increase (decrease) | (2,674) | 1,001 |
Cash, cash equivalents, and restricted cash and cash equivalents, beginning of period | 12,131 | 5,350 |
Cash, cash equivalents, and restricted cash and cash equivalents, end of period | 9,457 | 6,351 |
Supplemental disclosures of cash flow information: | ||
Interest paid | 104 | 87 |
Income taxes paid | 3 | 6 |
Equity issued in connection with acquisitions | 11,526 | 0 |
The following table provides a reconciliation of cash, cash equivalents, and restricted cash and cash equivalents reported within the Consolidated Balance Sheets to the totals above: | ||
Cash and cash equivalents | 9,308 | 6,345 |
Restricted cash and cash equivalents, included in restricted deposits | 149 | 6 |
Total cash, cash equivalents, and restricted cash and cash equivalents | $ 9,457 | $ 6,351 |
Organization and Operations
Organization and Operations | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Operations | Organization and Operations Basis of Presentation The accompanying interim financial statements have been prepared under the presumption that users of the interim financial information have either read or have access to the audited financial statements included in the Form 10-K for the fiscal year ended December 31, 2019 . The unaudited interim financial statements herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, footnote disclosures that would substantially duplicate the disclosures contained in the December 31, 2019 audited financial statements have been omitted from these interim financial statements, where appropriate. In the opinion of management, these financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of the results of the interim periods presented. Certain 2019 amounts in the consolidated financial statements and notes to the consolidated financial statements have been reclassified to conform to the 2020 presentation. These reclassifications have no effect on net earnings or stockholders' equity as previously reported. On January 23, 2020 , the Company acquired all of the issued and outstanding shares of WellCare Health Plans, Inc. (WellCare) (the WellCare Acquisition). The acquisition was accounted for as a business combination. See Note 2. Acquisitions for further details. Recently Adopted Accounting Guidance In June 2016, the Financial Accounting Standards Board (FASB) issued an Accounting Standards Update (ASU) which changes how entities measure credit losses for most financial assets and certain other investments that are not measured at fair value through net income. The ASU is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The amended guidance requires the measurement of all expected credit losses for financial assets (or groups of financial assets) and available for sale debt securities held at the reporting date over the remaining life based on historical experience, current conditions, and reasonable and supportable forecasts. The guidance is effective for annual and interim periods beginning after December 15, 2019. The Company adopted the new guidance in the first quarter of 2020. The majority of the Company’s receivables and other financial instruments are with government entities and, therefore, the adoption did not have a material impact on its receivables and other financial instruments. The Company evaluated its investment portfolio under the new available-for-sale debt securities impairment model guidance. The vast majority of the Company’s investment portfolio are low risk, investment grade securities. The impact of our evaluation of the investment portfolio resulted in an immaterial decrease to retained earnings at January 1, 2020. The Company evaluates available-for-sale debt securities on a regular basis and records an allowance for credit losses, if necessary. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The new guidance did not have a material impact on the Company’s consolidated financial position, results of operations or cash flows. In August 2018, the FASB issued an ASU which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this update. The amendments in this ASU require an entity that is the customer in a hosting arrangement to follow the guidance on internal-use software to determine which implementation costs to capitalize and which costs to expense. The standard also requires an entity that is the customer to expense the capitalized implementation costs of a hosting arrangement over the term of the hosting arrangement. The new guidance requires an entity to present the expense related to the capitalized implementation costs in the same line item in the statement of income as the fees associated with the hosting element of the arrangement and classify payments for capitalized implementation costs in the statement of cash flows in the same manner as payments made for fees associated with the hosting element. The entity is also required to present the capitalized implementation costs in the statement of financial position in the same line item that a prepayment for the fees of the associated hosting arrangement would be presented. The guidance is effective for annual and interim periods beginning after December 15, 2019. The Company adopted the new guidance in the first quarter of 2020. The new guidance did not have a material impact on the Company's consolidated financial position, results of operations or cash flows. Recent Accounting Guidance Not Yet Adopted In December 2019, the FASB issued an ASU which simplifies the accounting for income taxes by removing certain exceptions to the general principles in ASC Topic 740. The ASU also clarifies and amends certain areas of ASC Topic 740 to improve consistent application of and simplify the generally accepted accounting principles within Topic 740. The guidance is effective for annual and interim periods beginning after December 15, 2020. The Company is currently evaluating the potential impact of the ASU on the Company's consolidated financial position, results of operations and cash flows. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions WellCare Acquisition On January 23, 2020 , the Company acquired all of the issued and outstanding shares of WellCare. The transaction was valued at $19,555 million , including the assumption of debt. The WellCare Acquisition brings a high-quality Medicare platform and further extends our robust Medicaid offerings. The WellCare Acquisition also enables us to provide access to more comprehensive and differentiated solutions across more markets with a continued focus on affordable, high-quality, culturally-sensitive healthcare services. With the WellCare Acquisition, we further broadened our product offerings by adding a Medicare prescription drug plan to our existing business lines. Total consideration paid for the acquisition was $17,605 million , consisting of Centene common shares valued at $11,431 million (based on Centene's stock price of $66.76 ), $6,079 million in cash, and $95 million related to the fair value of replacement equity awards associated with pre-combination service. Each WellCare share was converted into 3.38 of validly issued, fully paid, non-assessable shares of Centene common stock and $120.00 in cash. In total, 171 million shares of Centene common stock were issued to the WellCare stockholders. The cash portion of the acquisition was funded through the issuance of long-term debt as further discussed in Note 7. Debt . The Company also recognized $313 million of acquisition related costs, primarily related to WellCare, that were in the consolidated statement of operations for the three months ended March 31, 2020 . The acquisition of WellCare was accounted for as a business combination using the acquisition method of accounting that requires assets acquired and liabilities assumed to be recognized at fair value as of the acquisition date. Due to the timing of the acquisition, the valuation of the assets acquired and liabilities assumed has not yet been finalized, and as a result, the preliminary estimates have been recorded and are subject to change. Any necessary adjustments from our preliminary estimates will be finalized within one year from the date of acquisition. Measurement period adjustments will be recorded in the period in which they are determined, as if they had been completed at the acquisition date. The Company's preliminary allocation of the fair value of assets acquired and liabilities assumed as of the acquisition date of January 23, 2020 is as follows ($ in millions): Assets acquired and liabilities assumed Cash and cash equivalents $ 2,899 Premium and related receivables 3,414 Short-term investments 403 Other current assets 1,158 Long-term investments 2,699 Restricted deposits 319 Property, software and equipment 270 Intangible assets (a) 7,000 Other long-term assets 261 Total assets acquired 18,423 Medical claims liability 3,962 Accounts payable and accrued expenses 3,142 Return of premium payable 238 Unearned revenue 223 Long-term debt (b) 2,055 Deferred tax liabilities (c) 1,537 Other long-term liabilities 281 Total liabilities assumed 11,438 Total identifiable net assets 6,985 Goodwill (d) 10,620 Total assets acquired and liabilities assumed $ 17,605 The Company has made the following preliminary fair value adjustments based on information reviewed through March 31, 2020. Significant fair value adjustments are noted as follows: (a) The identifiable intangible assets acquired are to be measured at fair value as of the completion of the acquisition. The fair value of intangible assets will be determined primarily using variations of the income approach, which is based on the present value of the future after tax cash flows attributable to each identified intangible asset. Other valuation methods, including the market approach and cost approach, will be considered in estimating the fair value. The identifiable intangible assets include purchased contract rights, trade names, provider contracts and developed technologies. The Company has estimated the preliminary fair value of intangible assets to be $7,000 million with a weighted average life of 13 years. The preliminary fair values and weighted average useful lives for identifiable intangible assets acquired are as follows: Fair Value Weighted Average Useful Life (in years) Purchased contract rights $ 5,200 Trade names 800 Provider contracts 700 Developed technologies 300 Total intangible assets acquired $ 7,000 13 (b) Debt is required to be measured at fair value under the acquisition method of accounting. The fair value of WellCare's aggregate principle of $1,950 million Senior Notes assumed in the acquisition was $2,055 million . The $105 million increase will be amortized as a reduction to interest expense over the remaining life of the debt. (c) The preliminary deferred tax liabilities are presented net of $408 million of deferred tax assets. (d) The acquisition resulted in $10.6 billion of goodwill related primarily to synergies expected from the acquisition and the assembled workforce of WellCare. The assignment of goodwill to the Company's respective segments has not been completed at this time, but the majority of goodwill is expected to be allocated to the Managed Care segment. The majority of the goodwill is not deductible for income tax purposes. Divestitures Immediately prior to the closing of the WellCare Acquisition , Anthem, Inc. acquired WellCare's Missouri Medicaid health plan, a WellCare Missouri Medicare Advantage health plan, and WellCare's Nebraska Medicaid health plan. CVS Health Corporation acquired portions of Centene's Illinois Medicaid and Medicare Advantage health plans as part of previously announced divestiture agreements. The Company recorded a $93 million pre-tax gain as a result of the Illinois divestiture, which is included in investment and other income on the Consolidated Statements of Operations. Unaudited Pro Forma Financial Information The following table presents supplemental pro forma information for the three months ended March 31, 2019 ($ in millions, except per share data): Three Months Ended Total revenues $ 25,169 Net earnings attributable to common stockholders $ 552 Diluted earnings per share $ 0.93 The unaudited pro forma total revenues for the three months ended March 31, 2020 were $27,815 million . It is impracticable for the Company to determine the pro forma earnings information for the three months ended March 31, 2020 due to the nature of obtaining that information as the Company immediately began integrating WellCare into its ongoing operations. The unaudited pro forma financial information reflects the historical results of Centene and WellCare adjusted as if the acquisition had occurred on January 1, 2019, primarily for the following: • Interest expense associated with debt incurred to finance the transaction. • Elimination of historical WellCare intangible asset amortization expense and addition of amortization expense based on the preliminary estimated values of identifiable intangible assets of approximately $7.0 billion . • Issuance of 171 million shares of Centene common stock in connection with the per share common stock consideration. • Elimination of acquisition related costs. • Adjustments to income tax expense related to pro forma adjustments and increased income tax expense related to IRS Regulation 162(m)(6). |
Short-term and Long-term Invest
Short-term and Long-term Investments, Restricted Deposits | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Short-term and Long-term Investments, Restricted Deposits | Short-term and Long-term Investments, Restricted Deposits Short-term and long-term investments and restricted deposits by investment type consist of the following ($ in millions): March 31, 2020 December 31, 2019 Amortized Cost Gross Gross Unrealized Losses Fair Value Amortized Cost Gross Unrealized Gains Gross Fair Value Debt securities: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 771 $ 7 $ — $ 778 $ 211 $ 1 $ — $ 212 Corporate securities 5,036 76 (134 ) 4,978 3,629 108 (4 ) 3,733 Restricted certificates of deposit 153 — — 153 482 — — 482 Restricted cash equivalents 149 — — 149 8 — — 8 Short-term time deposits 84 — — 84 — — — — Municipal securities 2,511 77 (4 ) 2,584 2,320 69 (1 ) 2,388 Asset-backed securities 1,050 4 (36 ) 1,018 741 5 (2 ) 744 Residential mortgage-backed securities 997 32 (2 ) 1,027 464 8 (1 ) 471 Commercial mortgage-backed securities 590 10 (13 ) 587 380 9 (1 ) 388 Equity securities (1) 685 — — 685 — — — — Private equity investments 748 — — 748 664 — — 664 Life insurance contracts 130 — — 130 148 — — 148 Total $ 12,904 $ 206 $ (189 ) $ 12,921 $ 9,047 $ 200 $ (9 ) $ 9,238 (1) Investments in equity securities primarily consists of exchange traded funds in fixed income securities. The Company’s investments are debt securities classified as available-for-sale with the exception of equity securities, life insurance contracts and certain private equity investments . The Company’s investment policies are designed to provide liquidity, preserve capital and maximize total return on invested assets with the focus on high credit quality securities. The Company limits the size of investment in any single issuer other than U.S. treasury securities and obligations of U.S. government corporations and agencies. As of March 31, 2020 , 97% of the Company’s investments in rated securities carry an investment grade rating by nationally recognized statistical rating organizations. At March 31, 2020 , the Company held certificates of deposit, equity securities, life insurance contracts and private equity investments which did not carry a credit rating. Accrued interest income on available for sale debt securities was $78 million at March 31, 2020, and is included in other current assets on the consolidated balance sheet. The Company's residential mortgage-backed securities are primarily issued by the Federal National Mortgage Association, Government National Mortgage Association or Federal Home Loan Mortgage Corporation, which carry implicit or explicit guarantees of the U.S. government. The Company's commercial mortgage-backed securities are primarily senior tranches with a weighted average rating of AA+ and a weighted average duration of 4 years at March 31, 2020 . The fair value of available-for-sale debt securities with gross unrealized losses by investment type and length of time that individual securities have been in a continuous unrealized loss position were as follows ($ in millions): March 31, 2020 December 31, 2019 Less Than 12 Months 12 Months or More Less Than 12 Months 12 Months or More Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value U.S. Treasury securities and obligations of U.S. government corporations and agencies $ — $ 374 $ — $ — $ — $ 11 $ — $ 31 Corporate securities (130 ) 2,461 (4 ) 16 (2 ) 192 (2 ) 48 Municipal securities (4 ) 275 — 1 (1 ) 185 — 11 Asset-backed securities (30 ) 628 (6 ) 102 (1 ) 153 (1 ) 151 Residential mortgage-backed securities (2 ) 68 — 6 — 44 (1 ) 81 Commercial mortgage-backed securities (13 ) 280 — 3 (1 ) 118 — 21 Short-term time deposits — — — 2 — — — — Total $ (179 ) $ 4,086 $ (10 ) $ 130 $ (5 ) $ 703 $ (4 ) $ 343 As of March 31, 2020 , the gross unrealized losses were generated from 2,636 positions out of a total of 5,998 positions. The change in fair value of fixed income securities is primarily a result of movement in interest rates subsequent to the purchase of the security. For each security in an unrealized loss position, the Company assesses whether it intends to sell the security or if it is more likely than not the Company will be required to sell the security before recovery of the amortized cost basis for reasons such as liquidity, contractual or regulatory purposes. If the security meets this criterion, the decline in fair value is recorded in earnings. The Company does not intend to sell these securities prior to maturity and it is not likely that the Company will be required to sell these securities prior to maturity; therefore, the Company did not record impairment for these securities. In addition, the Company continuously monitors investments for credit losses. Certain investments have experienced a decline in fair value due to changes in credit quality, market interest rates and/or general economic conditions. The Company recognizes an allowance when evidence demonstrates that it is credit related. Evidence of a credit related loss may include rating agency actions, adverse conditions specifically related to the security, or failure of the issuer of the security to make scheduled payments. The contractual maturities of short-term and long-term debt securities and restricted deposits are as follows ($ in millions): March 31, 2020 December 31, 2019 Investments Restricted Deposits Investments Restricted Deposits Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value One year or less $ 1,239 $ 1,237 $ 841 $ 842 $ 750 $ 752 $ 550 $ 550 One year through five years 3,954 3,935 169 172 3,034 3,106 106 108 Five years through ten years 2,430 2,465 — — 2,162 2,257 — — Greater than ten years 72 74 — — 48 50 — — Asset-backed securities 2,636 2,633 — — 1,585 1,603 — — Total $ 10,331 $ 10,344 $ 1,010 $ 1,014 $ 7,579 $ 7,768 $ 656 $ 658 Actual maturities may differ from contractual maturities due to call or prepayment options. Equity securities, private equity investments and life insurance contracts are excluded from the table above because they do not have a contractual maturity. The Company has an option to redeem at amortized cost substantially all of the securities included in the greater than ten years category listed above. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Assets and liabilities recorded at fair value in the Consolidated Balance Sheets are categorized based upon observable or unobservable inputs used to estimate fair value. Level inputs are as follows: Level Input: Input Definition: Level I Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level II Inputs other than quoted prices included in Level I that are observable for the asset or liability through corroboration with market data at the measurement date. Level III Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The following table summarizes fair value measurements by level at March 31, 2020 , for assets and liabilities measured at fair value on a recurring basis ($ in millions): Level I Level II Level III Total Assets Cash and cash equivalents $ 9,308 $ — $ — $ 9,308 Investments: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 114 $ — $ — $ 114 Corporate securities — 4,960 — 4,960 Municipal securities — 2,554 — 2,554 Short-term time deposits — 84 — 84 Asset-backed securities — 1,018 — 1,018 Residential mortgage-backed securities — 1,027 — 1,027 Commercial mortgage-backed securities — 587 — 587 Equity securities 683 2 — 685 Total investments $ 797 $ 10,232 $ — $ 11,029 Restricted deposits: Cash and cash equivalents $ 149 $ — $ — $ 149 Certificates of deposit — 153 — 153 Corporate securities — 18 — $ 18 Municipal securities — 30 — 30 U.S. Treasury securities and obligations of U.S. government corporations and agencies 664 — — 664 Total restricted deposits $ 813 $ 201 $ — $ 1,014 Total assets at fair value $ 10,918 $ 10,433 $ — $ 21,351 The following table summarizes fair value measurements by level at December 31, 2019 , for assets and liabilities measured at fair value on a recurring basis ($ in millions): Level I Level II Level III Total Assets Cash and cash equivalents $ 12,123 $ — $ — $ 12,123 Investments: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 73 $ — $ — $ 73 Corporate securities — 3,713 — 3,713 Municipal securities — 2,379 — 2,379 Asset-backed securities — 744 — 744 Residential mortgage-backed securities — 471 — 471 Commercial mortgage-backed securities — 388 — 388 Total investments $ 73 $ 7,695 $ — $ 7,768 Restricted deposits: Cash and cash equivalents $ 8 $ — $ — $ 8 Certificates of deposit — 482 — 482 Corporate securities — 20 — 20 Municipal securities — 9 — 9 U.S. Treasury securities and obligations of U.S. government corporations and agencies 139 — — 139 Total restricted deposits $ 147 $ 511 $ — $ 658 Other long-term assets: Interest rate swap agreements $ — $ 10 $ — $ 10 Total assets at fair value $ 12,343 $ 8,216 $ — $ 20,559 Liabilities Other long-term liabilities: Interest rate swap agreements $ — $ 11 $ — $ 11 Total liabilities at fair value $ — $ 11 $ — $ 11 The Company utilizes matrix-pricing services to estimate fair value for securities which are not actively traded on the measurement date. The Company designates these securities as Level II fair value measurements. In addition, the aggregate carrying amount of the Company’s life insurance contracts and other private equity investments , which approximates fair value, was $878 million and $812 million as of March 31, 2020 and December 31, 2019 , respectively. |
Medical Claims Liability
Medical Claims Liability | 3 Months Ended |
Mar. 31, 2020 | |
Insurance [Abstract] | |
Medical Claims Liability | Medical Claims Liability The following table summarizes the change in medical claims liability ($ in millions): Three Months Ended March 31, 2020 2019 Balance, January 1 $ 7,473 $ 6,831 Less: Reinsurance recoverable 20 27 Balance, January 1, net 7,453 6,804 Acquisitions and divestitures 3,697 6 Incurred related to: Current year 20,866 14,376 Prior years (446 ) (494 ) Total incurred 20,420 13,882 Paid related to: Current year 15,147 8,771 Prior years 5,031 4,560 Total paid 20,178 13,331 Balance at March 31, net 11,392 7,361 Plus: Reinsurance recoverable 21 20 Balance, March 31 $ 11,413 $ 7,381 Reinsurance recoverables related to medical claims are included in premium and trade receivables. Changes in estimates of incurred claims for prior years are primarily attributable to reserving under moderately adverse conditions. Additionally, as a result of minimum health benefits ratio (HBR) and other return of premium programs, we recorded $31 million as a reduction to premium revenue and $8 million as an increase to premium revenues in the three months ended March 31, 2020 and 2019 , respectively. Incurred but not reported (IBNR) plus expected development on reported claims as of March 31, 2020 was $7,527 million . Total IBNR plus expected development on reported claims represents estimates for claims incurred but not reported, development on reported claims, and estimates for the costs necessary to process unpaid claims at the end of each period. We estimate our liability using actuarial methods that are commonly used by health insurance actuaries and meet Actuarial Standards of Practice. These actuarial methods consider factors such as historical data for payment patterns, cost trends, product mix, seasonality, utilization of healthcare services and other relevant factors. |
Affordable Care Act
Affordable Care Act | 3 Months Ended |
Mar. 31, 2020 | |
Affordable Care Act [Abstract] | |
Affordable Care Act | Affordable Care Act The Affordable Care Act established risk spreading premium stabilization programs as well as minimum annual medical loss ratio and cost sharing reductions. The Company's net receivables (payables) for each of the programs are as follows ($ in millions): March 31, 2020 December 31, 2019 Risk adjustment receivable $ 326 $ 245 Risk adjustment payable (1,569 ) (1,239 ) Minimum medical loss ratio (466 ) (367 ) Cost sharing reduction receivable 96 73 Cost sharing reduction payable (1 ) (1 ) |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt consists of the following ($ in millions): March 31, 2020 December 31, 2019 $1,000 million 4.75% Senior Notes, due May 15, 2022 $ 1,007 $ 1,004 $1,000 million 6.125% Senior Notes, due February 15, 2024 — 1,000 $2,200 million 4.75% Senior Notes, due January 15, 2025 2,236 2,228 $1,200 million 5.250% Senior Notes due April 1, 2025 1,250 — $1,800 million 5.375% Senior Notes, due June 1, 2026 1,800 1,800 $750 million 5.375% Senior Notes due August 15, 2026 800 — $2,500 million 4.25% Senior Notes due December 15, 2027 2,480 2,479 $3,500 million 4.625% Senior Notes due December 15, 2029 3,500 3,500 $2,000 million 3.375% Senior Notes due February 15, 2030 2,000 — Fair value of interest rate swap agreements — (1 ) Total senior notes 15,073 12,010 Term loan credit facility 1,450 1,450 Revolving credit agreement 588 93 Mortgage notes payable 53 54 Construction loan payable 149 140 Finance leases and other 119 122 Debt issuance costs (153 ) (143 ) Total debt 17,279 13,726 Less current portion (129 ) (88 ) Long-term debt $ 17,150 $ 13,638 Senior Notes In February 2020, the Company issued $2,000 million 3.375% Senior Notes due February 15, 2030 (the 2030 Notes). The Company used the net proceeds from the 2030 Notes to redeem all of its outstanding $1,000 million 6.125% Senior Notes, due February 15, 2024 (the 2024 Notes). The Company recognized a pre-tax loss on extinguishment of approximately $44 million , including the call premium, the write-off of unamortized debt issuance costs and the loss on the termination of the $1,000 million interest rate swap associated with the 2024 Notes. The Company also intended to use remaining proceeds to redeem its $1,000 million 4.75% Senior Notes due May 15, 2022 (the 2022 Notes). However, as a result of the spread of COVID-19 and the resulting disruption and volatility in the global capital markets, the Company has deferred the redemption of the 2022 Notes at this time. In connection with the WellCare Acquisition, in January 2020, the Company completed an exchange offer for up to $1,200 million of 5.25% Senior Notes due April 1, 2025 and $750 million of 5.375% Senior Notes due August 15, 2026 (collectively, the WellCare Notes) issued by WellCare and issued $1,146 million aggregate principal amount of 5.25% Senior Notes due April 1, 2025 and $747 million aggregate principal amount of 5.375% Senior Notes due August 15, 2026. Additionally, the Company's wholly owned subsidiary, WellCare Health Plans, Inc., assumed the remaining unexchanged WellCare Notes. The WellCare Notes were recorded at the acquisition date fair value of $2,055 million . Interest Rate Swaps During the three months ended March 31, 2020, the Company terminated the interest rate swap agreements associated with the 2022 Notes and $2,200 million 4.75% Senior Notes, due January 15, 2025, (the 2025 Notes). The interest rate swap associated with the 2024 Notes were also terminated in connection with the redemption of those notes as discussed above. In total, the Company terminated three interest rate swap contracts with a notional amount of $2,100 million . The swaps effectively converted $2,100 million of fixed rate notes to floating rates. As a result of the interest rate swap terminations, the Company received $9 million in cash. The corresponding net gain on the 2022 Notes and 2025 Notes is being amortized as a reduction to interest expense over the remaining term of the respective notes. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases The Company records right of use (ROU) assets and liabilities for non-cancelable operating leases primarily for real estate and equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Expense related to leases is recorded on a straight-line basis over the lease term, including rent holidays. During the three months ended March 31, 2020 , the Company recognized operating lease expense of $62 million . The following table sets forth the ROU assets and liabilities as of March 31, 2020 ($ in millions): March 31, 2020 Assets ROU assets (recorded within other long-term assets) $ 852 Liabilities Short-term (recorded within accounts payable and accrued expenses) $ 198 Long-term (recorded within other long-term liabilities) 794 Total ROU liabilities $ 992 During the three months ended March 31, 2020 , the Company reduced its ROU liabilities by $63 million , for cash paid. The Company did not have any new operating leases commence during the three months ended March 31, 2020 , that resulted in the recognition of ROU assets and liabilities. As of March 31, 2020 , the Company had additional operating leases that have not yet commenced of $421 million , which included four significant leases executed during the first quarter . These operating leases will commence in 2020 with lease terms of 2 years to 16 years. In connection with the WellCare Acquisition, we acquired approximately $240 million and $260 million of ROU assets and liabilities, respectively. As of March 31, 2020 , the weighted average remaining lease term of the Company's operating leases was 6.8 years. The ROU liabilities as of March 31, 2020 reflect a weighted average discount rate of 4.7% . Lease payments over the next five years and thereafter are as follows ($ in millions): March 31, 2020 2020 $ 177 2021 223 2022 174 2023 140 2024 117 2025 82 Thereafter 258 Total lease payments 1,171 Less: imputed interest (179 ) Total ROU liabilities $ 992 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity In January 2020, the Company issued 171 million shares of Centene common stock with a fair value of $11,431 million and paid $6,079 million in cash in exchange for all the outstanding shares of WellCare common stock. In addition, the Company recorded $95 million related to the fair value of replacement equity awards associated with pre-combination service. During the three months ended March 31, 2020 , the Company used proceeds from divestitures to repurchase 8,672 thousand shares of Centene common stock for $500 million through the Company's stock repurchase program. As of March 31, 2020 , the Company has a remaining amount of 5,488 thousand shares available under the program. The remaining common stock repurchases during the quarter relate to the purchase of shares to satisfy tax withholding requirements in connection with employee equity awards. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table sets forth the calculation of basic and diluted net earnings per common share ($ in millions, except per share data in dollars and shares in thousands): Three Months Ended March 31, 2020 2019 Earnings attributable to Centene Corporation $ 46 $ 522 Shares used in computing per share amounts: Weighted average number of common shares outstanding 544,436 412,924 Common stock equivalents (as determined by applying the treasury stock method) 7,626 6,828 Weighted average number of common shares and potential dilutive common shares outstanding 552,062 419,752 Net earnings per common share attributable to Centene Corporation: Basic earnings per common share $ 0.08 $ 1.26 Diluted earnings per common share $ 0.08 $ 1.24 The calculation of diluted earnings per common share for the three months ended March 31, 2020 and March 31, 2019 excludes the impact of 400 thousand and 1,400 thousand shares, respectively, related to anti-dilutive stock options, restricted stock and restricted stock units. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Centene operates in two segments: Managed Care and Specialty Services. The Managed Care segment consists of Centene’s health plans, including all of the functions needed to operate them. Subsequent to the closing of the WellCare Acquisition, the Managed Care segment also includes WellCare's legacy Medicaid Health Plans, Medicare Health Plans and Medicare Prescription Drug Plan (PDP) segments. The Specialty Services segment consists of Centene’s specialty companies offering auxiliary healthcare services and products. Factors used in determining the reportable business segments include the nature of operating activities, the existence of separate senior management teams, and the type of information presented to the Company's chief operating decision-maker to evaluate all results of operations. Segment information for the three months ended March 31, 2020 , follows ($ in millions): Managed Care Specialty Services Eliminations Consolidated Total Total revenues from external customers $ 24,936 $ 1,089 $ — $ 26,025 Total revenues from internal customers 100 2,814 (2,914 ) — Total revenues $ 25,036 $ 3,903 $ (2,914 ) $ 26,025 Earnings from operations $ 217 $ (29 ) $ — $ 188 Segment information for the three months ended March 31, 2019 , follows ($ in millions): Managed Care Specialty Services Eliminations Consolidated Total Total revenues from external customers $ 17,687 $ 757 $ — $ 18,444 Total revenues from internal customers 35 2,449 (2,484 ) — Total revenues $ 17,722 $ 3,206 $ (2,484 ) $ 18,444 Earnings from operations $ 615 $ 70 $ — $ 685 |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Overview The Company is routinely subjected to legal and regulatory proceedings in the normal course of business. These matters can include, without limitation: • periodic compliance and other reviews and investigations by various federal and state regulatory agencies with respect to requirements applicable to the Company's business, including, without limitation, those related to payment of out-of-network claims, submissions to CMS for risk adjustment payments or the False Claims Act, submissions to state agencies related to payments or state false claims acts, pre-authorization penalties, timely review of grievances and appeals, timely and accurate payment of claims, and the Health Insurance Portability and Accountability Act of 1996 and other federal and state fraud, waste and abuse laws; • litigation arising out of general business activities, such as tax matters, disputes related to healthcare benefits coverage or reimbursement, putative securities class actions and medical malpractice, privacy, real estate, intellectual property and employment-related claims; • disputes regarding reinsurance arrangements, claims arising out of the acquisition or divestiture of various assets, class actions and claims relating to the performance of contractual and non-contractual obligations to providers, members, employer groups and others, including, but not limited to, the alleged failure to properly pay claims and challenges to the manner in which the Company processes claims and claims alleging that the Company has engaged in unfair business practices. Among other things, these matters may result in awards of damages, fines or penalties, which could be substantial, and/or could require changes to the Company's business. The Company intends to vigorously defend itself against legal and regulatory proceedings to which it is currently a party; however, these proceedings are subject to many uncertainties. In some of the cases pending against the Company, substantial non-economic or punitive damages are being sought. The Company records reserves and accrues costs for certain legal proceedings and regulatory matters to the extent that it determines an unfavorable outcome is probable and the amount of the loss can be reasonably estimated. While such reserves and accrued costs reflect the Company's best estimate of the probable loss for such matters, the recorded amounts may differ materially from the actual amount of any such losses. In some cases, no estimate of the possible loss or range of loss in excess of amounts accrued, if any, can be made because of the inherently unpredictable nature of legal and regulatory proceedings, which may be exacerbated by various factors, including but not limited to, they may involve indeterminate claims for monetary damages or may involve fines, penalties or punitive damages; present novel legal theories or legal uncertainties; involve disputed facts; represent a shift in regulatory policy; involve a large number of parties, claimants or regulatory bodies; are in the early stages of the proceedings; involve a number of separate proceedings and/or a wide range of potential outcomes; or result in a change of business practices. As of the date of this report, amounts accrued for legal proceedings and regulatory matters were not material. However, it is possible that in a particular quarter or annual period the Company's financial condition, results of operations, cash flow and/or liquidity could be materially adversely affected by an ultimate unfavorable resolution of, or development in, legal and/or regulatory proceedings, including as described below. Except for the proceedings discussed below, the Company believes that the ultimate outcome of any of the regulatory and legal proceedings that are currently pending against it should not have a material adverse effect on financial condition, results of operations, cash flow or liquidity. California On October 20, 2015, the Company's California subsidiary, Health Net of California, Inc. (Health Net California), was named as a defendant in a California taxpayer action filed in Los Angeles County Superior Court, captioned as Michael D. Myers v. State Board of Equalization, Dave Jones, Insurance Commissioner of the State of California, Betty T. Yee, Controller of the State of California, et al., Los Angeles Superior Court Case No. BS158655. This action is brought under a California statute that permits an individual taxpayer to sue a governmental agency when the taxpayer believes the agency has failed to enforce governing law. Plaintiff contends that Health Net California, a California licensed Health Care Service Plan (HCSP), is an "insurer" for purposes of taxation despite acknowledging it is not an "insurer" under regulatory law. Under California law, "insurers" must pay a gross premiums tax (GPT), calculated as 2.35% on gross premiums. As a licensed HCSP, Health Net California has paid the California Corporate Franchise Tax (CFT), the tax generally paid by California businesses. Plaintiff contends that Health Net California must pay the GPT rather than the CFT. Plaintiff seeks a writ of mandate directing the California taxing agencies to collect the GPT, and seeks an order requiring Health Net California to pay GPT, interest and penalties for a period dating to eight years prior to the October 2015 filing of the complaint. This lawsuit is being coordinated with similar lawsuits filed against other entities (collectively, "Related Actions"). In March 2018, the Court overruled the Company's demurrer seeking to dismiss the complaint and denied the Company's motion to strike allegations seeking retroactive relief. In August 2018, the trial court stayed all the Related Actions pending determination of a writ of mandate by the California Court of Appeals in two of the Related Actions. In March 2019, the California Court of Appeals denied the writ of mandate. The defendants in those Related Actions sought review by the California Supreme Court, which declined to review the matter. Upon the return of the matter to the Los Angeles County Superior Court, motions for summary judgment were scheduled. Health Net California's motion for summary judgment was heard by the Court on March 4, 2020. On March 29, 2020, the Court granted Health Net California's motion for summary judgment. The plaintiff may or may not appeal the Court's decision. The Company intends to continue its vigorous defense against these claims; however, this matter is subject to many uncertainties, and an adverse outcome in this matter could potentially have a materially adverse impact on the Company's financial position, results of operations and cash flows. Veterans Administration Matter In October 2017, a Civil Investigative Demand (CID) was issued to Health Net Federal Services, LLC (HNFS) by the United States Department of Justice. The CID seeks documents and interrogatory responses concerning whether HNFS submitted, or caused to be submitted, excessive, duplicative or otherwise improper claims to the U.S. Department of Veterans Affairs (VA) under a contract to provide healthcare coordination services for veterans. The contract began in late 2014 and ended September 30, 2018. In 2016, modifications to the contract were made to allow for possible duplicate billings with a reconciliation period at the end of the contract term. The Company is complying with the CID and believes it has met its contractual obligations. At this point, it is not possible to determine what level of liability, if any, the Company may face as a result of this matter. Ambetter Class Action On January 11, 2018, a putative class action lawsuit was filed by Cynthia Harvey and Steven A. Milman against the Company and certain subsidiaries in the U.S. District Court for the Eastern District of Washington. The complaint alleges that the Company failed to meet federal and state requirements for provider networks and directories with regard to its Ambetter policies, denied coverage and/or refused to pay for covered benefits, and failed to address grievances adequately, causing some members to incur unexpected costs. In March 2018, the Company filed separate motions to dismiss each defendant. In July 2018, the plaintiff voluntarily filed a First Amended Complaint that removed Steven Milman as a plaintiff, dropped Centene Corporation and Superior Health Plan as defendants, abandoned certain claims, narrowed the putative class to Washington State only, and added Centene Management Company as a defendant. In August 2018, the Company moved to dismiss the First Amended Complaint. In response, the plaintiff voluntarily filed a Second Amended Complaint. In September 2018, the Company filed a motion to dismiss the Second Amended Complaint. On November 21, 2018, the Court granted in part and denied in part the Company's motion to dismiss. Plaintiff Cynthia Harvey filed a Third Amended Complaint, on November 28, 2018, against Centene Management Company and Coordinated Care Corporation (Defendants), both subsidiaries of the Company. Defendants filed an answer on December 12, 2018. The plaintiffs filed a motion for class certification on January 8, 2020. The hearing on that motion is scheduled for May 12, 2020. The Company intends to vigorously defend itself against these claims. Nevertheless, this matter is subject to many uncertainties and the Company cannot predict how long this litigation will last or what the ultimate outcome will be, and an adverse outcome in this matter could potentially have a materially adverse impact on the Company's financial position and results of operations. |
Organization and Operations (Po
Organization and Operations (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying interim financial statements have been prepared under the presumption that users of the interim financial information have either read or have access to the audited financial statements included in the Form 10-K for the fiscal year ended December 31, 2019 . The unaudited interim financial statements herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, footnote disclosures that would substantially duplicate the disclosures contained in the December 31, 2019 audited financial statements have been omitted from these interim financial statements, where appropriate. In the opinion of management, these financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of the results of the interim periods presented. Certain 2019 amounts in the consolidated financial statements and notes to the consolidated financial statements have been reclassified to conform to the 2020 presentation. These reclassifications have no effect on net earnings or stockholders' equity as previously reported. On January 23, 2020 , the Company acquired all of the issued and outstanding shares of WellCare Health Plans, Inc. (WellCare) (the WellCare Acquisition). The acquisition was accounted for as a business combination. See Note 2. Acquisitions for further details. |
Recently Adopted Accounting Guidance and Accounting Guidance Not Yet Adopted | Recently Adopted Accounting Guidance In June 2016, the Financial Accounting Standards Board (FASB) issued an Accounting Standards Update (ASU) which changes how entities measure credit losses for most financial assets and certain other investments that are not measured at fair value through net income. The ASU is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The amended guidance requires the measurement of all expected credit losses for financial assets (or groups of financial assets) and available for sale debt securities held at the reporting date over the remaining life based on historical experience, current conditions, and reasonable and supportable forecasts. The guidance is effective for annual and interim periods beginning after December 15, 2019. The Company adopted the new guidance in the first quarter of 2020. The majority of the Company’s receivables and other financial instruments are with government entities and, therefore, the adoption did not have a material impact on its receivables and other financial instruments. The Company evaluated its investment portfolio under the new available-for-sale debt securities impairment model guidance. The vast majority of the Company’s investment portfolio are low risk, investment grade securities. The impact of our evaluation of the investment portfolio resulted in an immaterial decrease to retained earnings at January 1, 2020. The Company evaluates available-for-sale debt securities on a regular basis and records an allowance for credit losses, if necessary. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The new guidance did not have a material impact on the Company’s consolidated financial position, results of operations or cash flows. In August 2018, the FASB issued an ASU which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this update. The amendments in this ASU require an entity that is the customer in a hosting arrangement to follow the guidance on internal-use software to determine which implementation costs to capitalize and which costs to expense. The standard also requires an entity that is the customer to expense the capitalized implementation costs of a hosting arrangement over the term of the hosting arrangement. The new guidance requires an entity to present the expense related to the capitalized implementation costs in the same line item in the statement of income as the fees associated with the hosting element of the arrangement and classify payments for capitalized implementation costs in the statement of cash flows in the same manner as payments made for fees associated with the hosting element. The entity is also required to present the capitalized implementation costs in the statement of financial position in the same line item that a prepayment for the fees of the associated hosting arrangement would be presented. The guidance is effective for annual and interim periods beginning after December 15, 2019. The Company adopted the new guidance in the first quarter of 2020. The new guidance did not have a material impact on the Company's consolidated financial position, results of operations or cash flows. Recent Accounting Guidance Not Yet Adopted In December 2019, the FASB issued an ASU which simplifies the accounting for income taxes by removing certain exceptions to the general principles in ASC Topic 740. The ASU also clarifies and amends certain areas of ASC Topic 740 to improve consistent application of and simplify the generally accepted accounting principles within Topic 740. The guidance is effective for annual and interim periods beginning after December 15, 2020. The Company is currently evaluating the potential impact of the ASU on the Company's consolidated financial position, results of operations and cash flows. |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Schedule of Allocation of the Fair Value of Assets Acquired and Liabilities Assumed | The Company's preliminary allocation of the fair value of assets acquired and liabilities assumed as of the acquisition date of January 23, 2020 is as follows ($ in millions): Assets acquired and liabilities assumed Cash and cash equivalents $ 2,899 Premium and related receivables 3,414 Short-term investments 403 Other current assets 1,158 Long-term investments 2,699 Restricted deposits 319 Property, software and equipment 270 Intangible assets (a) 7,000 Other long-term assets 261 Total assets acquired 18,423 Medical claims liability 3,962 Accounts payable and accrued expenses 3,142 Return of premium payable 238 Unearned revenue 223 Long-term debt (b) 2,055 Deferred tax liabilities (c) 1,537 Other long-term liabilities 281 Total liabilities assumed 11,438 Total identifiable net assets 6,985 Goodwill (d) 10,620 Total assets acquired and liabilities assumed $ 17,605 |
Schedule of Fair Values and Weighted Average Useful Lives for Intangible Assets Acquired | The preliminary fair values and weighted average useful lives for identifiable intangible assets acquired are as follows: Fair Value Weighted Average Useful Life (in years) Purchased contract rights $ 5,200 Trade names 800 Provider contracts 700 Developed technologies 300 Total intangible assets acquired $ 7,000 13 |
Supplement Pro Forma Information | The following table presents supplemental pro forma information for the three months ended March 31, 2019 ($ in millions, except per share data): Three Months Ended Total revenues $ 25,169 Net earnings attributable to common stockholders $ 552 Diluted earnings per share $ 0.93 |
Short-term and Long-term Inve_2
Short-term and Long-term Investments, Restricted Deposits (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Short-term and long-term investments and restricted deposits by investment type | Short-term and long-term investments and restricted deposits by investment type consist of the following ($ in millions): March 31, 2020 December 31, 2019 Amortized Cost Gross Gross Unrealized Losses Fair Value Amortized Cost Gross Unrealized Gains Gross Fair Value Debt securities: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 771 $ 7 $ — $ 778 $ 211 $ 1 $ — $ 212 Corporate securities 5,036 76 (134 ) 4,978 3,629 108 (4 ) 3,733 Restricted certificates of deposit 153 — — 153 482 — — 482 Restricted cash equivalents 149 — — 149 8 — — 8 Short-term time deposits 84 — — 84 — — — — Municipal securities 2,511 77 (4 ) 2,584 2,320 69 (1 ) 2,388 Asset-backed securities 1,050 4 (36 ) 1,018 741 5 (2 ) 744 Residential mortgage-backed securities 997 32 (2 ) 1,027 464 8 (1 ) 471 Commercial mortgage-backed securities 590 10 (13 ) 587 380 9 (1 ) 388 Equity securities (1) 685 — — 685 — — — — Private equity investments 748 — — 748 664 — — 664 Life insurance contracts 130 — — 130 148 — — 148 Total $ 12,904 $ 206 $ (189 ) $ 12,921 $ 9,047 $ 200 $ (9 ) $ 9,238 (1) Investments in equity securities primarily consists of exchange traded funds in fixed income securities. |
Fair value of available-for-sale investments with gross unrealized losses by investment type and length of time | The fair value of available-for-sale debt securities with gross unrealized losses by investment type and length of time that individual securities have been in a continuous unrealized loss position were as follows ($ in millions): March 31, 2020 December 31, 2019 Less Than 12 Months 12 Months or More Less Than 12 Months 12 Months or More Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value U.S. Treasury securities and obligations of U.S. government corporations and agencies $ — $ 374 $ — $ — $ — $ 11 $ — $ 31 Corporate securities (130 ) 2,461 (4 ) 16 (2 ) 192 (2 ) 48 Municipal securities (4 ) 275 — 1 (1 ) 185 — 11 Asset-backed securities (30 ) 628 (6 ) 102 (1 ) 153 (1 ) 151 Residential mortgage-backed securities (2 ) 68 — 6 — 44 (1 ) 81 Commercial mortgage-backed securities (13 ) 280 — 3 (1 ) 118 — 21 Short-term time deposits — — — 2 — — — — Total $ (179 ) $ 4,086 $ (10 ) $ 130 $ (5 ) $ 703 $ (4 ) $ 343 |
Contractual maturities of short-term and long-term investments and restricted deposits | The contractual maturities of short-term and long-term debt securities and restricted deposits are as follows ($ in millions): March 31, 2020 December 31, 2019 Investments Restricted Deposits Investments Restricted Deposits Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value One year or less $ 1,239 $ 1,237 $ 841 $ 842 $ 750 $ 752 $ 550 $ 550 One year through five years 3,954 3,935 169 172 3,034 3,106 106 108 Five years through ten years 2,430 2,465 — — 2,162 2,257 — — Greater than ten years 72 74 — — 48 50 — — Asset-backed securities 2,636 2,633 — — 1,585 1,603 — — Total $ 10,331 $ 10,344 $ 1,010 $ 1,014 $ 7,579 $ 7,768 $ 656 $ 658 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements by Level for Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following table summarizes fair value measurements by level at March 31, 2020 , for assets and liabilities measured at fair value on a recurring basis ($ in millions): Level I Level II Level III Total Assets Cash and cash equivalents $ 9,308 $ — $ — $ 9,308 Investments: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 114 $ — $ — $ 114 Corporate securities — 4,960 — 4,960 Municipal securities — 2,554 — 2,554 Short-term time deposits — 84 — 84 Asset-backed securities — 1,018 — 1,018 Residential mortgage-backed securities — 1,027 — 1,027 Commercial mortgage-backed securities — 587 — 587 Equity securities 683 2 — 685 Total investments $ 797 $ 10,232 $ — $ 11,029 Restricted deposits: Cash and cash equivalents $ 149 $ — $ — $ 149 Certificates of deposit — 153 — 153 Corporate securities — 18 — $ 18 Municipal securities — 30 — 30 U.S. Treasury securities and obligations of U.S. government corporations and agencies 664 — — 664 Total restricted deposits $ 813 $ 201 $ — $ 1,014 Total assets at fair value $ 10,918 $ 10,433 $ — $ 21,351 The following table summarizes fair value measurements by level at December 31, 2019 , for assets and liabilities measured at fair value on a recurring basis ($ in millions): Level I Level II Level III Total Assets Cash and cash equivalents $ 12,123 $ — $ — $ 12,123 Investments: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 73 $ — $ — $ 73 Corporate securities — 3,713 — 3,713 Municipal securities — 2,379 — 2,379 Asset-backed securities — 744 — 744 Residential mortgage-backed securities — 471 — 471 Commercial mortgage-backed securities — 388 — 388 Total investments $ 73 $ 7,695 $ — $ 7,768 Restricted deposits: Cash and cash equivalents $ 8 $ — $ — $ 8 Certificates of deposit — 482 — 482 Corporate securities — 20 — 20 Municipal securities — 9 — 9 U.S. Treasury securities and obligations of U.S. government corporations and agencies 139 — — 139 Total restricted deposits $ 147 $ 511 $ — $ 658 Other long-term assets: Interest rate swap agreements $ — $ 10 $ — $ 10 Total assets at fair value $ 12,343 $ 8,216 $ — $ 20,559 Liabilities Other long-term liabilities: Interest rate swap agreements $ — $ 11 $ — $ 11 Total liabilities at fair value $ — $ 11 $ — $ 11 |
Medical Claims Liability (Table
Medical Claims Liability (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Insurance [Abstract] | |
Schedule of change in medical claims liability | The following table summarizes the change in medical claims liability ($ in millions): Three Months Ended March 31, 2020 2019 Balance, January 1 $ 7,473 $ 6,831 Less: Reinsurance recoverable 20 27 Balance, January 1, net 7,453 6,804 Acquisitions and divestitures 3,697 6 Incurred related to: Current year 20,866 14,376 Prior years (446 ) (494 ) Total incurred 20,420 13,882 Paid related to: Current year 15,147 8,771 Prior years 5,031 4,560 Total paid 20,178 13,331 Balance at March 31, net 11,392 7,361 Plus: Reinsurance recoverable 21 20 Balance, March 31 $ 11,413 $ 7,381 |
Affordable Care Act (Tables)
Affordable Care Act (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Affordable Care Act [Abstract] | |
Schedule of net receivables (payables) related to the Affordable Care Act Programs | The Company's net receivables (payables) for each of the programs are as follows ($ in millions): March 31, 2020 December 31, 2019 Risk adjustment receivable $ 326 $ 245 Risk adjustment payable (1,569 ) (1,239 ) Minimum medical loss ratio (466 ) (367 ) Cost sharing reduction receivable 96 73 Cost sharing reduction payable (1 ) (1 ) |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Debt consists of the following ($ in millions): March 31, 2020 December 31, 2019 $1,000 million 4.75% Senior Notes, due May 15, 2022 $ 1,007 $ 1,004 $1,000 million 6.125% Senior Notes, due February 15, 2024 — 1,000 $2,200 million 4.75% Senior Notes, due January 15, 2025 2,236 2,228 $1,200 million 5.250% Senior Notes due April 1, 2025 1,250 — $1,800 million 5.375% Senior Notes, due June 1, 2026 1,800 1,800 $750 million 5.375% Senior Notes due August 15, 2026 800 — $2,500 million 4.25% Senior Notes due December 15, 2027 2,480 2,479 $3,500 million 4.625% Senior Notes due December 15, 2029 3,500 3,500 $2,000 million 3.375% Senior Notes due February 15, 2030 2,000 — Fair value of interest rate swap agreements — (1 ) Total senior notes 15,073 12,010 Term loan credit facility 1,450 1,450 Revolving credit agreement 588 93 Mortgage notes payable 53 54 Construction loan payable 149 140 Finance leases and other 119 122 Debt issuance costs (153 ) (143 ) Total debt 17,279 13,726 Less current portion (129 ) (88 ) Long-term debt $ 17,150 $ 13,638 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
ROU Assets and Liabilities | The following table sets forth the ROU assets and liabilities as of March 31, 2020 ($ in millions): March 31, 2020 Assets ROU assets (recorded within other long-term assets) $ 852 Liabilities Short-term (recorded within accounts payable and accrued expenses) $ 198 Long-term (recorded within other long-term liabilities) 794 Total ROU liabilities $ 992 |
Maturity of Operating Lease Liabilities | Lease payments over the next five years and thereafter are as follows ($ in millions): March 31, 2020 2020 $ 177 2021 223 2022 174 2023 140 2024 117 2025 82 Thereafter 258 Total lease payments 1,171 Less: imputed interest (179 ) Total ROU liabilities $ 992 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Calculation of Basic and Diluted Net Earnings Per Common Share | The following table sets forth the calculation of basic and diluted net earnings per common share ($ in millions, except per share data in dollars and shares in thousands): Three Months Ended March 31, 2020 2019 Earnings attributable to Centene Corporation $ 46 $ 522 Shares used in computing per share amounts: Weighted average number of common shares outstanding 544,436 412,924 Common stock equivalents (as determined by applying the treasury stock method) 7,626 6,828 Weighted average number of common shares and potential dilutive common shares outstanding 552,062 419,752 Net earnings per common share attributable to Centene Corporation: Basic earnings per common share $ 0.08 $ 1.26 Diluted earnings per common share $ 0.08 $ 1.24 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment information for the three months ended March 31, 2020 , follows ($ in millions): Managed Care Specialty Services Eliminations Consolidated Total Total revenues from external customers $ 24,936 $ 1,089 $ — $ 26,025 Total revenues from internal customers 100 2,814 (2,914 ) — Total revenues $ 25,036 $ 3,903 $ (2,914 ) $ 26,025 Earnings from operations $ 217 $ (29 ) $ — $ 188 Segment information for the three months ended March 31, 2019 , follows ($ in millions): Managed Care Specialty Services Eliminations Consolidated Total Total revenues from external customers $ 17,687 $ 757 $ — $ 18,444 Total revenues from internal customers 35 2,449 (2,484 ) — Total revenues $ 17,722 $ 3,206 $ (2,484 ) $ 18,444 Earnings from operations $ 615 $ 70 $ — $ 685 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) $ / shares in Units, shares in Millions, $ in Millions | Jan. 23, 2020USD ($)$ / sharesshares | Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) |
Business Acquisition [Line Items] | |||
Centene stock price (in usd per share) | $ / shares | $ 66.76 | ||
Acquisition related costs | $ 313 | ||
Gain on divestiture | (93) | $ 0 | |
Centene Illinois Medicaid and Medicare Advantage Health Plans | |||
Business Acquisition [Line Items] | |||
Gain on divestiture | $ (93) | ||
WellCare Health Plans, Inc. | |||
Business Acquisition [Line Items] | |||
Transaction value | 19,555 | ||
Consideration transferred | 17,605 | ||
Consideration transferred, shares valued | 11,431 | ||
Cash paid | 6,079 | ||
Consideration transferred related to fair value of replacement equity awards associated with pre-combination service | $ 95 | ||
Common stock cancelled and converted into right to Centene common stock | 3.38 | ||
Cash paid per acquiree share, without interest (in usd per share) | $ / shares | $ 120 | ||
Shares issued (in shares) | shares | 171 | ||
Pro forma revenue (unaudited) | $ 27,815 | $ 25,169 |
Acquisitions - Schedule of Fair
Acquisitions - Schedule of Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions | Jan. 23, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Assets acquired and liabilities assumed | |||
Goodwill | $ 17,417 | $ 6,863 | |
WellCare Health Plans, Inc. | |||
Assets acquired and liabilities assumed | |||
Cash and cash equivalents | $ 2,899 | ||
Premium and related receivables | 3,414 | ||
Short-term investments | 403 | ||
Other current assets | 1,158 | ||
Long-term investments | 2,699 | ||
Restricted deposits | 319 | ||
Property, software and equipment | 270 | ||
Intangible assets | 7,000 | ||
Other long-term assets | 261 | ||
Total assets acquired | 18,423 | ||
Medical claims liability | 3,962 | ||
Accounts payable and accrued expenses | 3,142 | ||
Return of premium payable | 238 | ||
Unearned revenue | 223 | ||
Long-term debt | 2,055 | ||
Deferred tax liabilities | 1,537 | ||
Other long-term liabilities | 281 | ||
Total liabilities assumed | 11,438 | ||
Total identifiable net assets | 6,985 | ||
Goodwill | 10,620 | ||
Total assets acquired and liabilities assumed | $ 17,605 | ||
Acquired intangibles, weighted average useful life years | 13 years | ||
Debt assumed, aggregate principle | $ 1,950 | ||
Debt assumed, excess of principle | 105 | ||
Deferred tax assets | 408 | ||
WellCare Health Plans, Inc. | Customer relationships | |||
Assets acquired and liabilities assumed | |||
Intangible assets | 5,200 | ||
WellCare Health Plans, Inc. | Provider contracts | |||
Assets acquired and liabilities assumed | |||
Intangible assets | 700 | ||
WellCare Health Plans, Inc. | Trade names | |||
Assets acquired and liabilities assumed | |||
Intangible assets | 800 | ||
WellCare Health Plans, Inc. | Developed technologies | |||
Assets acquired and liabilities assumed | |||
Intangible assets | $ 300 |
Acquisitions - Supplemental Pro
Acquisitions - Supplemental Proforma Information (Details) - WellCare Health Plans, Inc. - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Business Acquisition [Line Items] | ||
Total revenues | $ 27,815 | $ 25,169 |
Net earnings attributable to common stockholders | $ 552 | |
Diluted earnings per share (in usd per share) | $ 0.93 |
Short-term and Long-term Inve_3
Short-term and Long-term Investments, Restricted Deposits - By Investment Type (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Securities | ||
Gross Unrealized Gains | $ 206 | $ 200 |
Gross Unrealized Losses | (189) | (9) |
Equity securities | 685 | 0 |
Private equity investments | 748 | 664 |
Life insurance contracts | 130 | 148 |
Total, Amortized Cost | 12,904 | 9,047 |
Total, Fair Value | 12,921 | 9,238 |
U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Debt Securities | ||
Amortized Cost | 771 | 211 |
Gross Unrealized Gains | 7 | 1 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 778 | 212 |
Corporate securities | ||
Debt Securities | ||
Amortized Cost | 5,036 | 3,629 |
Gross Unrealized Gains | 76 | 108 |
Gross Unrealized Losses | (134) | (4) |
Fair Value | 4,978 | 3,733 |
Restricted certificates of deposit | ||
Debt Securities | ||
Amortized Cost | 153 | 482 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 153 | 482 |
Restricted cash equivalents | ||
Debt Securities | ||
Amortized Cost | 149 | 8 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 149 | 8 |
Short-term time deposits | ||
Debt Securities | ||
Amortized Cost | 84 | 0 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 84 | 0 |
Municipal securities | ||
Debt Securities | ||
Amortized Cost | 2,511 | 2,320 |
Gross Unrealized Gains | 77 | 69 |
Gross Unrealized Losses | (4) | (1) |
Fair Value | 2,584 | 2,388 |
Asset-backed securities | ||
Debt Securities | ||
Amortized Cost | 1,050 | 741 |
Gross Unrealized Gains | 4 | 5 |
Gross Unrealized Losses | (36) | (2) |
Fair Value | 1,018 | 744 |
Residential mortgage-backed securities | ||
Debt Securities | ||
Amortized Cost | 997 | 464 |
Gross Unrealized Gains | 32 | 8 |
Gross Unrealized Losses | (2) | (1) |
Fair Value | 1,027 | 471 |
Commercial mortgage-backed securities | ||
Debt Securities | ||
Amortized Cost | 590 | 380 |
Gross Unrealized Gains | 10 | 9 |
Gross Unrealized Losses | (13) | (1) |
Fair Value | $ 587 | $ 388 |
Short-term and Long-term Inve_4
Short-term and Long-term Investments, Restricted Deposits - Narrative (Details) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020USD ($)position | Dec. 31, 2019 | |
Schedule Of Investments And Restricted Deposits By Type [Line Items] | ||
Accrued interest income | $ | $ 78 | |
Positions from which gross unrealized losses were generated | 2,636 | |
Total unrealized investment positions | 5,998 | |
Commercial mortgage-backed securities | ||
Schedule Of Investments And Restricted Deposits By Type [Line Items] | ||
Investments recorded at fair value that carry rating of AA Plus, weighted average (in years) | 4 years | |
Rated Securities | External Credit Rating, Investment Grade | ||
Schedule Of Investments And Restricted Deposits By Type [Line Items] | ||
Percentage of investments in rated securities carry an investment grade rating by nationally recognized statistical rating organizations | 97.00% |
Short-term and Long-term Inve_5
Short-term and Long-term Investments, Restricted Deposits - Fair Value of Available-For-Sale Investments with Gross Unrealized Losses by Investment Type and Length of Time (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Unrealized Losses | ||
Less Than 12 Months | $ (179) | $ (5) |
12 Months or More | (10) | (4) |
Fair Value | ||
Fair Value, Less Than 12 Months | 4,086 | 703 |
Fair Value, 12 Months or More | 130 | 343 |
U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Unrealized Losses | ||
Less Than 12 Months | 0 | 0 |
12 Months or More | 0 | 0 |
Fair Value | ||
Fair Value, Less Than 12 Months | 374 | 11 |
Fair Value, 12 Months or More | 0 | 31 |
Corporate securities | ||
Unrealized Losses | ||
Less Than 12 Months | (130) | (2) |
12 Months or More | (4) | (2) |
Fair Value | ||
Fair Value, Less Than 12 Months | 2,461 | 192 |
Fair Value, 12 Months or More | 16 | 48 |
Municipal securities | ||
Unrealized Losses | ||
Less Than 12 Months | (4) | (1) |
12 Months or More | 0 | 0 |
Fair Value | ||
Fair Value, Less Than 12 Months | 275 | 185 |
Fair Value, 12 Months or More | 1 | 11 |
Asset-backed securities | ||
Unrealized Losses | ||
Less Than 12 Months | (30) | (1) |
12 Months or More | (6) | (1) |
Fair Value | ||
Fair Value, Less Than 12 Months | 628 | 153 |
Fair Value, 12 Months or More | 102 | 151 |
Residential mortgage-backed securities | ||
Unrealized Losses | ||
Less Than 12 Months | (2) | 0 |
12 Months or More | 0 | (1) |
Fair Value | ||
Fair Value, Less Than 12 Months | 68 | 44 |
Fair Value, 12 Months or More | 6 | 81 |
Commercial mortgage-backed securities | ||
Unrealized Losses | ||
Less Than 12 Months | (13) | (1) |
12 Months or More | 0 | 0 |
Fair Value | ||
Fair Value, Less Than 12 Months | 280 | 118 |
Fair Value, 12 Months or More | 3 | 21 |
Short-term time deposits | ||
Unrealized Losses | ||
Less Than 12 Months | 0 | 0 |
12 Months or More | 0 | 0 |
Fair Value | ||
Fair Value, Less Than 12 Months | 0 | 0 |
Fair Value, 12 Months or More | $ 2 | $ 0 |
Short-term and Long-term Inve_6
Short-term and Long-term Investments, Restricted Deposits - Contractual Maturities of Short-Term and Long-Term Investments and Restricted Deposits (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Investments | ||
Amortized Cost | ||
One year or less | $ 1,239 | $ 750 |
One year through five years | 3,954 | 3,034 |
Five years through ten years | 2,430 | 2,162 |
Greater than ten years | 72 | 48 |
Asset-backed securities | 2,636 | 1,585 |
Amortized Cost | 10,331 | 7,579 |
Fair Value | ||
One year or less | 1,237 | 752 |
One year through five years | 3,935 | 3,106 |
Five years through ten years | 2,465 | 2,257 |
Greater than ten years | 74 | 50 |
Asset-backed securities | 2,633 | 1,603 |
Fair Value | 10,344 | 7,768 |
Restricted Deposits | ||
Amortized Cost | ||
One year or less | 841 | 550 |
One year through five years | 169 | 106 |
Five years through ten years | 0 | 0 |
Greater than ten years | 0 | 0 |
Asset-backed securities | 0 | 0 |
Amortized Cost | 1,010 | 656 |
Fair Value | ||
One year or less | 842 | 550 |
One year through five years | 172 | 108 |
Five years through ten years | 0 | 0 |
Greater than ten years | 0 | 0 |
Asset-backed securities | 0 | 0 |
Fair Value | $ 1,014 | $ 658 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Measurements by Level for Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Cash and cash equivalents | $ 9,308 | $ 12,123 |
Investments: | ||
Equity securities | 685 | 0 |
Other long-term assets: | ||
Total assets at fair value | 21,351 | 20,559 |
Other long-term liabilities: | ||
Total liabilities at fair value | 11 | |
U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Investments: | ||
Fair Value | 778 | 212 |
Corporate securities | ||
Investments: | ||
Fair Value | 4,978 | 3,733 |
Municipal securities | ||
Investments: | ||
Fair Value | 2,584 | 2,388 |
Short-term time deposits | ||
Investments: | ||
Fair Value | 84 | 0 |
Asset-backed securities | ||
Investments: | ||
Fair Value | 1,018 | 744 |
Residential mortgage-backed securities | ||
Investments: | ||
Fair Value | 1,027 | 471 |
Commercial mortgage-backed securities | ||
Investments: | ||
Fair Value | 587 | 388 |
Interest rate swap agreements | ||
Other long-term liabilities: | ||
Interest rate swap agreements | 11 | |
Available-for-sale Securities | ||
Investments: | ||
Fair Value | 11,029 | 7,768 |
Available-for-sale Securities | U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Investments: | ||
Fair Value | 114 | 73 |
Available-for-sale Securities | Corporate securities | ||
Investments: | ||
Fair Value | 4,960 | 3,713 |
Available-for-sale Securities | Municipal securities | ||
Investments: | ||
Fair Value | 2,554 | 2,379 |
Available-for-sale Securities | Short-term time deposits | ||
Investments: | ||
Fair Value | 84 | |
Available-for-sale Securities | Asset-backed securities | ||
Investments: | ||
Fair Value | 1,018 | 744 |
Available-for-sale Securities | Residential mortgage-backed securities | ||
Investments: | ||
Fair Value | 1,027 | 471 |
Available-for-sale Securities | Commercial mortgage-backed securities | ||
Investments: | ||
Fair Value | 587 | 388 |
Restricted Deposits | ||
Investments: | ||
Fair Value | 1,014 | 658 |
Restricted Deposits | U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Investments: | ||
Fair Value | 664 | 139 |
Restricted Deposits | Corporate securities | ||
Investments: | ||
Fair Value | 18 | 20 |
Restricted Deposits | Municipal securities | ||
Investments: | ||
Fair Value | 30 | 9 |
Restricted Deposits | Cash and cash equivalents | ||
Investments: | ||
Fair Value | 149 | 8 |
Restricted Deposits | Certificates of deposit | ||
Investments: | ||
Fair Value | 153 | 482 |
Other long-term assets | Interest rate swap agreements | ||
Other long-term assets: | ||
Derivative asset | 10 | |
Level I | ||
Assets | ||
Cash and cash equivalents | 9,308 | 12,123 |
Investments: | ||
Equity securities | 683 | |
Other long-term assets: | ||
Total assets at fair value | 10,918 | 12,343 |
Other long-term liabilities: | ||
Total liabilities at fair value | 0 | |
Level I | Interest rate swap agreements | ||
Other long-term liabilities: | ||
Interest rate swap agreements | 0 | |
Level I | Available-for-sale Securities | ||
Investments: | ||
Fair Value | 797 | 73 |
Level I | Available-for-sale Securities | U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Investments: | ||
Fair Value | 114 | 73 |
Level I | Available-for-sale Securities | Corporate securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level I | Available-for-sale Securities | Municipal securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level I | Available-for-sale Securities | Short-term time deposits | ||
Investments: | ||
Fair Value | 0 | |
Level I | Available-for-sale Securities | Asset-backed securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level I | Available-for-sale Securities | Residential mortgage-backed securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level I | Available-for-sale Securities | Commercial mortgage-backed securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level I | Restricted Deposits | ||
Investments: | ||
Fair Value | 813 | 147 |
Level I | Restricted Deposits | U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Investments: | ||
Fair Value | 664 | 139 |
Level I | Restricted Deposits | Corporate securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level I | Restricted Deposits | Municipal securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level I | Restricted Deposits | Cash and cash equivalents | ||
Investments: | ||
Fair Value | 149 | 8 |
Level I | Restricted Deposits | Certificates of deposit | ||
Investments: | ||
Fair Value | 0 | 0 |
Level I | Other long-term assets | Interest rate swap agreements | ||
Other long-term assets: | ||
Derivative asset | 0 | |
Level II | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Investments: | ||
Equity securities | 2 | |
Other long-term assets: | ||
Total assets at fair value | 10,433 | 8,216 |
Other long-term liabilities: | ||
Total liabilities at fair value | 11 | |
Level II | Interest rate swap agreements | ||
Other long-term liabilities: | ||
Interest rate swap agreements | 11 | |
Level II | Available-for-sale Securities | ||
Investments: | ||
Fair Value | 10,232 | 7,695 |
Level II | Available-for-sale Securities | U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Investments: | ||
Fair Value | 0 | 0 |
Level II | Available-for-sale Securities | Corporate securities | ||
Investments: | ||
Fair Value | 4,960 | 3,713 |
Level II | Available-for-sale Securities | Municipal securities | ||
Investments: | ||
Fair Value | 2,554 | 2,379 |
Level II | Available-for-sale Securities | Short-term time deposits | ||
Investments: | ||
Fair Value | 84 | |
Level II | Available-for-sale Securities | Asset-backed securities | ||
Investments: | ||
Fair Value | 1,018 | 744 |
Level II | Available-for-sale Securities | Residential mortgage-backed securities | ||
Investments: | ||
Fair Value | 1,027 | 471 |
Level II | Available-for-sale Securities | Commercial mortgage-backed securities | ||
Investments: | ||
Fair Value | 587 | 388 |
Level II | Restricted Deposits | ||
Investments: | ||
Fair Value | 201 | 511 |
Level II | Restricted Deposits | U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Investments: | ||
Fair Value | 0 | 0 |
Level II | Restricted Deposits | Corporate securities | ||
Investments: | ||
Fair Value | 18 | 20 |
Level II | Restricted Deposits | Municipal securities | ||
Investments: | ||
Fair Value | 30 | 9 |
Level II | Restricted Deposits | Cash and cash equivalents | ||
Investments: | ||
Fair Value | 0 | 0 |
Level II | Restricted Deposits | Certificates of deposit | ||
Investments: | ||
Fair Value | 153 | 482 |
Level II | Other long-term assets | Interest rate swap agreements | ||
Other long-term assets: | ||
Derivative asset | 10 | |
Level III | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Investments: | ||
Equity securities | 0 | |
Other long-term assets: | ||
Total assets at fair value | 0 | 0 |
Other long-term liabilities: | ||
Total liabilities at fair value | 0 | |
Level III | Interest rate swap agreements | ||
Other long-term liabilities: | ||
Interest rate swap agreements | 0 | |
Level III | Available-for-sale Securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Available-for-sale Securities | U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Available-for-sale Securities | Corporate securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Available-for-sale Securities | Municipal securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Available-for-sale Securities | Short-term time deposits | ||
Investments: | ||
Fair Value | 0 | |
Level III | Available-for-sale Securities | Asset-backed securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Available-for-sale Securities | Residential mortgage-backed securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Available-for-sale Securities | Commercial mortgage-backed securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Restricted Deposits | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Restricted Deposits | U.S. Treasury securities and obligations of U.S. government corporations and agencies | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Restricted Deposits | Corporate securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Restricted Deposits | Municipal securities | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Restricted Deposits | Cash and cash equivalents | ||
Investments: | ||
Fair Value | 0 | 0 |
Level III | Restricted Deposits | Certificates of deposit | ||
Investments: | ||
Fair Value | $ 0 | 0 |
Level III | Other long-term assets | Interest rate swap agreements | ||
Other long-term assets: | ||
Derivative asset | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value Disclosures [Abstract] | ||
Aggregate carrying amount of life insurance contracts and equity investments, fair value | $ 878 | $ 812 |
Medical Claims Liability - Sche
Medical Claims Liability - Schedule of Change in Medical Claims Liability (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||
Balance, January 1 | $ 7,473 | $ 6,831 |
Less: Reinsurance recoverable | 20 | 27 |
Balance, January 1, net | 7,453 | 6,804 |
Acquisitions and divestitures | 3,697 | 6 |
Incurred related to: | ||
Current year | 20,866 | 14,376 |
Prior years | (446) | (494) |
Total incurred | 20,420 | 13,882 |
Paid related to: | ||
Current year | 15,147 | 8,771 |
Prior years | 5,031 | 4,560 |
Total paid | 20,178 | 13,331 |
Balance at March 31, net | 11,392 | 7,361 |
Plus: Reinsurance recoverable | 21 | 20 |
Balance, March 31 | $ 11,413 | $ 7,381 |
Medical Claims Liability - Narr
Medical Claims Liability - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Insurance [Abstract] | ||
Amounts recorded as an adjustment to premium revenues related to minimum HBR and return of premium programs | $ (31) | $ 8 |
Short-duration insurance contracts, Incurred but not reported and expected development on reported claims | $ 7,527 |
Affordable Care Act - Net Recei
Affordable Care Act - Net Receivables (Payables) for Each of the Ongoing Programs (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Affordable Care Act [Abstract] | ||
Risk adjustment receivable | $ 326 | $ 245 |
Risk adjustment payable | (1,569) | (1,239) |
Minimum medical loss ratio | (466) | (367) |
Cost sharing reduction receivable | 96 | 73 |
Cost sharing reduction payable | $ (1) | $ (1) |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) | Mar. 31, 2020 | Feb. 29, 2020 | Jan. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||||
Fair value of interest rate swap agreements | $ 0 | $ (1,000,000) | ||
Total senior notes | 15,073,000,000 | 12,010,000,000 | ||
Mortgage notes payable | 53,000,000 | 54,000,000 | ||
Construction loan payable | 149,000,000 | 140,000,000 | ||
Finance leases and other | 119,000,000 | 122,000,000 | ||
Debt issuance costs | (153,000,000) | (143,000,000) | ||
Total debt | 17,279,000,000 | 13,726,000,000 | ||
Less current portion | (129,000,000) | (88,000,000) | ||
Long-term debt | 17,150,000,000 | 13,638,000,000 | ||
Revolving credit agreement | ||||
Debt Instrument [Line Items] | ||||
Revolving credit agreement | 588,000,000 | 93,000,000 | ||
Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | 2,100,000,000 | |||
Term loan credit facility | ||||
Debt Instrument [Line Items] | ||||
Revolving credit agreement | 1,450,000,000 | 1,450,000,000 | ||
$1,000 million 4.75% Senior Notes, due May 15, 2022 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | $ 1,000,000,000 | |||
Interest rate | 4.75% | 4.75% | ||
Senior notes | $ 1,007,000,000 | 1,004,000,000 | ||
$1,000 million 6.125% Senior Notes, due February 15, 2024 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | $ 1,000,000,000 | |||
Interest rate | 6.125% | |||
Senior notes | 0 | 1,000,000,000 | ||
$2,200 million 4.75% Senior Notes, due January 15, 2025 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | $ 2,200,000,000 | |||
Interest rate | 4.75% | |||
Senior notes | $ 2,236,000,000 | 2,228,000,000 | ||
$1,200 million 5.250% Senior Notes due April 1, 2025 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Senior notes | 1,250,000,000 | 0 | ||
$1,800 million 5.375% Senior Notes, due June 1, 2026 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | $ 1,800,000,000 | |||
Interest rate | 5.375% | |||
Senior notes | $ 1,800,000,000 | 1,800,000,000 | ||
$2,500 million 4.25% Senior Notes due December 15, 2027 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | $ 2,500,000 | |||
Interest rate | 4.25% | |||
Senior notes | $ 2,480,000,000 | 2,479,000,000 | ||
$3,500 million 4.625% Senior Notes due December 15, 2029 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | $ 3,500,000 | |||
Interest rate | 4.625% | |||
Senior notes | $ 3,500,000,000 | 3,500,000,000 | ||
$2,000 million 3.375% Senior Notes due February 15, 2030 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | $ 2,000,000 | $ 2,000,000,000 | ||
Interest rate | 3.375% | 3.375% | ||
Senior notes | $ 2,000,000,000 | 0 | ||
WellCare Health Plans, Inc. | $1,200 million 5.250% Senior Notes due April 1, 2025 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | $ 1,200,000,000 | |||
Interest rate | 5.25% | |||
WellCare Health Plans, Inc. | $750 million 5.375% Senior Notes due August 15, 2026 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | $ 750,000 | $ 750,000,000 | ||
Interest rate | 5.375% | 5.375% | ||
Senior notes | $ 800,000,000 | $ 0 |
Debt - Narrative (Details)
Debt - Narrative (Details) | 1 Months Ended | 3 Months Ended | |||
Feb. 29, 2020USD ($) | Mar. 31, 2020USD ($)derivative | Mar. 31, 2019USD ($) | Jan. 31, 2020USD ($) | Jan. 23, 2020USD ($) | |
Debt Instrument [Line Items] | |||||
Loss on extinguishment of debt | $ 44,000,000 | $ 44,000,000 | $ 0 | ||
Number of Interest rate swap contracts terminated | derivative | 3 | ||||
Proceeds from termination of interest rate swaps | $ 9,000,000 | ||||
WellCare Health Plans, Inc. | |||||
Debt Instrument [Line Items] | |||||
Acquisition of WellCare Notes | $ 2,055,000,000 | ||||
Interest Rate Swap | |||||
Debt Instrument [Line Items] | |||||
Derivative notional amount | 1,000,000,000 | 2,100,000,000 | |||
Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | 2,100,000,000 | ||||
Senior Notes | 3.375% Senior Notes Due 2030 | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | $ 2,000,000,000 | $ 2,000,000 | |||
Interest rate | 3.375% | 3.375% | |||
Senior Notes | $1,000 million 6.125% Senior Notes, due February 15, 2024 | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | $ 1,000,000,000 | ||||
Interest rate | 6.125% | ||||
Senior Notes | $1,000 million 4.75% Senior Notes, due May 15, 2022 | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | $ 1,000,000,000 | ||||
Interest rate | 4.75% | 4.75% | |||
Debt redemption amount | $ 1,000,000,000 | ||||
Senior Notes | $1,200 Million Senior Notes Due April 2025 | WellCare Health Plans, Inc. | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | $ 1,200,000,000 | ||||
Interest rate | 5.25% | ||||
Senior Notes | $750 million 5.375% Senior Notes due August 15, 2026 | WellCare Health Plans, Inc. | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | $ 750,000 | $ 750,000,000 | |||
Interest rate | 5.375% | 5.375% | |||
Senior Notes | $1,146 Million 5.25% Senior Notes Due 2025 | WellCare Health Plans, Inc. | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | $ 1,146,000,000 | ||||
Interest rate | 5.25% | ||||
Senior Notes | 5.375% Senior Notes Due 2026 | WellCare Health Plans, Inc. | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | $ 747,000,000 | ||||
Interest rate | 5.375% | ||||
Senior Notes | $2,200 million 4.75% Senior Notes, due January 15, 2025 | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | $ 2,200,000,000 | ||||
Interest rate | 4.75% |
Leases - Additional (Details)
Leases - Additional (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2020USD ($)lease | Jan. 23, 2020USD ($) | |
Lessee, Lease, Description [Line Items] | ||
Lease terms | 12 months | |
Operating lease expense | $ 62 | |
ROU assets acquired | 852 | |
ROU liability acquired | 992 | |
Lease liabilities reduced by cash paid | 63 | |
Operating leases not yet commenced | $ 421 | |
Operating leases not yet commenced, number of significant leases executed | lease | 4 | |
Weighted average remaining lease term | 6 years 9 months 18 days | |
Weighted-average discount rate for operating leases | 4.70% | |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Lease terms | 2 years | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Lease terms | 16 years | |
WellCare Health Plans, Inc. | ||
Lessee, Lease, Description [Line Items] | ||
ROU assets acquired | $ 240 | |
ROU liability acquired | $ 260 |
Leases - ROU Assets and Liabili
Leases - ROU Assets and Liabilities (Details) $ in Millions | Mar. 31, 2020USD ($) |
Assets | |
ROU assets (recorded within other long-term assets) | $ 852 |
Liabilities | |
Short-term (recorded within accounts payable and accrued expenses) | 198 |
Long-term (recorded within other long-term liabilities) | 794 |
Total ROU liabilities | $ 992 |
Leases - Operating Lease Paymen
Leases - Operating Lease Payments Over Next Five Years (Details) $ in Millions | Mar. 31, 2020USD ($) |
Leases [Abstract] | |
2020 | $ 177 |
2021 | 223 |
2022 | 174 |
2023 | 140 |
2024 | 117 |
2025 | 82 |
Thereafter | 258 |
Total lease payments | 1,171 |
Less: imputed interest | (179) |
Total ROU liabilities | $ 992 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) shares in Thousands, $ in Millions | Jan. 23, 2020 | Mar. 31, 2020 | Mar. 31, 2019 |
Business Acquisition [Line Items] | |||
Common stock repurchases | $ 558 | $ 35 | |
Remaining number of shares available under the program (in shares) | 5,488 | ||
WellCare Health Plans, Inc. | |||
Business Acquisition [Line Items] | |||
Shares issued (in shares) | 171,000 | ||
Consideration transferred, shares valued | $ 11,431 | ||
Cash paid | 6,079 | ||
Consideration transferred related to fair value of replacement equity awards associated with pre-combination service | $ 95 | ||
Stock Repurchase Program | |||
Business Acquisition [Line Items] | |||
Common stock repurchases (in shares) | 8,672 | ||
Common stock repurchases | $ 500 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings attributable to Centene Corporation | ||
Earnings attributable to Centene Corporation | $ 46 | $ 522 |
Shares used in computing per share amounts: | ||
Weighted average number of common shares outstanding (in shares) | 544,436 | 412,924 |
Common stock equivalents (as determined by applying the treasury stock method) (in shares) | 7,626 | 6,828 |
Weighted average number of common shares and potential dilutive common shares outstanding (in shares) | 552,062 | 419,752 |
Net earnings per common share attributable to Centene Corporation: | ||
Basic earnings per common share (in dollars per share) | $ 0.08 | $ 1.26 |
Diluted earnings per common share (in dollars per share) | $ 0.08 | $ 1.24 |
Anti-dilutive restricted stock and restricted stock units excluded from the calculation of diluted earnings per common share (in shares) | 400 | 1,400 |
Segment Information (Details)
Segment Information (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2019segment | |
Segment Reporting [Abstract] | |||
Number of operating segments | segment | 2 | ||
Segment Reporting Information [Line Items] | |||
Total revenues | $ 26,025 | $ 18,444 | |
Earnings from operations | 188 | 685 | |
Eliminations | |||
Segment Reporting Information [Line Items] | |||
Total revenues | (2,914) | (2,484) | |
Earnings from operations | 0 | ||
Managed Care | |||
Segment Reporting Information [Line Items] | |||
Total revenues | 25,036 | 17,722 | |
Earnings from operations | 217 | 615 | |
Managed Care | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Total revenues | 24,936 | 17,687 | |
Managed Care | Eliminations | |||
Segment Reporting Information [Line Items] | |||
Total revenues | 100 | 35 | |
Specialty Services | |||
Segment Reporting Information [Line Items] | |||
Total revenues | 3,903 | 3,206 | |
Earnings from operations | (29) | 70 | |
Specialty Services | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Total revenues | 1,089 | 757 | |
Specialty Services | Eliminations | |||
Segment Reporting Information [Line Items] | |||
Total revenues | $ 2,814 | $ 2,449 |