Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data in Thousands, unless otherwise specified | Dec. 31, 2013 | Feb. 20, 2014 | Jun. 28, 2013 |
Document and Entity Information [Abstract] | ' | ' | ' |
Entity Registrant Name | 'MOLINA HEALTHCARE INC | ' | ' |
Entity Central Index Key | '0001179929 | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Filer Category | 'Large Accelerated Filer | ' | ' |
Entity Public Float | ' | ' | $1,060.90 |
Entity Common Stock, Shares Outstanding | ' | 45,977 | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $935,895 | $795,770 |
Investments | 703,052 | 342,845 |
Receivables | 298,935 | 149,682 |
Income tax refundable | 32,742 | 0 |
Deferred income taxes | 26,556 | 32,443 |
Prepaid expenses and other current assets | 42,484 | 28,386 |
Total current assets | 2,039,664 | 1,349,126 |
Property, equipment, and capitalized software, net | 292,083 | 221,443 |
Deferred contract costs | 45,675 | 58,313 |
Intangible assets, net | 98,871 | 77,711 |
Goodwill | 230,738 | 151,088 |
Restricted investments | 63,093 | 44,101 |
Auction rate securities | 10,898 | 13,419 |
Derivative asset | 186,351 | 0 |
Other assets | 35,564 | 19,621 |
Total assets | 3,002,937 | 1,934,822 |
Current liabilities: | ' | ' |
Medical claims and benefits payable | 669,787 | 494,530 |
Accounts payable and accrued liabilities | 319,965 | 184,034 |
Deferred revenue | 122,216 | 141,798 |
Income taxes payable | 0 | 6,520 |
Current maturities of long-term debt | 182,008 | 1,155 |
Total current liabilities | 1,293,976 | 828,037 |
Convertible senior notes | 416,368 | 175,468 |
Lease financing obligations | 159,394 | 0 |
Lease financing obligations - related party | 27,092 | 0 |
Other long-term debt | 0 | 86,316 |
Deferred income taxes | 580 | 37,900 |
Derivative liability | 186,239 | 1,307 |
Other long-term liabilities | 26,351 | 23,480 |
Total liabilities | 2,110,000 | 1,152,508 |
Stockholders' equity: | ' | ' |
Common stock, $0.001 par value; 150,000 shares authorized; outstanding: 45,871 shares at December 31, 2013 and 46, 762 shares at December 31,2012 | 46 | 47 |
Preferred stock, $0.001 par value; 20,000 shares authorized, no shares issued and outstanding | 0 | 0 |
Additional paid-in capital | 340,848 | 285,524 |
Accumulated other comprehensive loss | -1,086 | -457 |
Treasury stock, at cost; outstanding: 111 shares at December 31, 2012 | 0 | -3,000 |
Retained earnings | 553,129 | 500,200 |
Total stockholders’ equity | 892,937 | 782,314 |
Total liabilities and stockholders' equity | $3,002,937 | $1,934,822 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | 1-May-13 | Apr. 30, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' | ' | ' |
Common stock, par value | $0.00 | ' | ' | $0.00 |
Common stock, shares authorized | 150,000,000 | 150,000,000 | 80,000,000 | 150,000,000 |
Common stock, shares outstanding | 45,871,000 | ' | ' | 46,762,000 |
Preferred stock, par value | $0.00 | ' | ' | $0.00 |
Preferred stock, shares authorized | 20,000,000 | ' | ' | 20,000,000 |
Preferred stock, shares issued | 0 | ' | ' | 0 |
Preferred stock, shares outstanding | 0 | ' | ' | 0 |
Treasury stock, shares | ' | ' | ' | 111,000 |
Consolidated_Statements_of_Inc
Consolidated Statements of Income (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Revenue from continuing operations: | ' | ' | ' |
Premium revenue | $6,179,170 | $5,544,121 | $4,211,493 |
Premium tax revenue | 172,017 | 158,991 | 154,589 |
Service revenue | 204,535 | 187,710 | 160,447 |
Investment income | 6,890 | 5,075 | 5,446 |
Rental income and other revenue | 26,322 | 18,312 | 8,288 |
Total revenue | 6,588,934 | 5,914,209 | 4,540,263 |
Expenses: | ' | ' | ' |
Medical care costs | 5,380,124 | 4,991,188 | 3,664,161 |
Cost of service revenue | 161,494 | 141,208 | 143,987 |
General and administrative expenses | 665,996 | 518,615 | 393,452 |
Premium tax expenses | 172,017 | 158,991 | 154,589 |
Depreciation and amortization | 72,743 | 63,114 | 48,253 |
Total operating expenses | 6,452,374 | 5,873,116 | 4,404,442 |
Operating income (loss) | 136,560 | 41,093 | 135,821 |
Interest expense | 52,071 | 16,769 | 15,519 |
Other expense, net | 3,343 | 945 | 0 |
Total other expenses, net | 55,414 | 17,714 | 15,519 |
Income from continuing operations before income tax expense | 81,146 | 23,379 | 120,302 |
Income tax expense | 36,316 | 10,513 | 42,914 |
Income from continuing operations | 44,830 | 12,866 | 77,388 |
Income (loss) from discontinued operations, net of tax (benefit) expense of $(9,912), $(1,238), and $922, respectively | 8,099 | -3,076 | -56,570 |
Net income | $52,929 | $9,790 | $20,818 |
Basic income per share: | ' | ' | ' |
Income from continuing operations (in dollars per share) | $0.98 | $0.28 | $1.69 |
Income (loss) from discontinued operations (in dollars per share) | $0.18 | ($0.07) | ($1.24) |
Basic net income per share | $1.16 | $0.21 | $0.45 |
Diluted net income per share | ' | ' | ' |
Income from continuing operations (in dollars per share) | $0.96 | $0.27 | $1.67 |
Income (loss) from discontinued operations (in dollars per share) | $0.17 | ($0.06) | ($1.22) |
Diluted net income per share | $1.13 | $0.21 | $0.45 |
Weighted average shares outstanding: | ' | ' | ' |
Basic | 45,717 | 46,380 | 45,756 |
Diluted | 46,862 | 46,999 | 46,425 |
Consolidated_Statements_of_Inc1
Consolidated Statements of Income (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Statement [Abstract] | ' | ' | ' |
Income (loss) from discontinued operations, tax expense (benefit) | ($9,912) | ($1,238) | $922 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||
Statement of Comprehensive Income [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Net income | ($9,126) | $7,569 | $24,571 | [1] | $29,915 | [2] | $25,643 | $3,364 | ($37,306) | $18,089 | [2] | $52,929 | $9,790 | $20,818 |
Other comprehensive (loss) income, before tax: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Gross unrealized investment (loss) gain | ' | ' | ' | ' | ' | ' | ' | ' | -1,015 | 1,529 | 1,167 | |||
Effect of income tax (benefit) expense | ' | ' | ' | ' | ' | ' | ' | ' | -386 | 581 | 380 | |||
Other comprehensive (loss) income, net of tax | ' | ' | ' | ' | ' | ' | ' | ' | -629 | 948 | 787 | |||
Comprehensive income | ' | ' | ' | ' | ' | ' | ' | ' | $52,300 | $10,738 | $21,605 | |||
[1] | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | |||||||||||||
[2] | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock |
In Thousands, except Share data, unless otherwise specified | ||||||
Beginning Balance at Dec. 31, 2010 | $719,057 | $45 | $251,612 | ($2,192) | $469,592 | $0 |
Beginning Balance, shares at Dec. 31, 2010 | 45,463,000 | 45,463,000 | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' |
Net income | 20,818 | ' | ' | ' | 20,818 | ' |
Other comprehensive income (loss), net of tax | 787 | ' | ' | 787 | ' | ' |
Purchase of treasury stock | -7,000 | ' | ' | ' | ' | -7,000 |
Retirement of treasury stock, shares | ' | -400,000 | ' | ' | ' | ' |
Retirement of treasury stock | 0 | ' | -7,000 | ' | ' | 7,000 |
Employee stock grants and employee stock plan purchases, shares | ' | 752,000 | ' | ' | ' | ' |
Employee stock grants and employee stock plan purchases | 20,474 | 1 | 20,473 | ' | ' | ' |
Tax benefit from employee stock compensation | 937 | ' | 937 | ' | ' | ' |
Ending Balance at Dec. 31, 2011 | 755,073 | 46 | 266,022 | -1,405 | 490,410 | 0 |
Ending Balance, shares at Dec. 31, 2011 | 45,815,000 | 45,815,000 | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' |
Net income | 9,790 | ' | ' | ' | 9,790 | ' |
Other comprehensive income (loss), net of tax | 948 | ' | ' | 948 | ' | ' |
Purchase of treasury stock, shares | ' | -111,000 | ' | ' | ' | ' |
Purchase of treasury stock | -3,000 | ' | ' | ' | ' | -3,000 |
Employee stock grants and employee stock plan purchases, shares | 1,057,000 | 1,058,000 | ' | ' | ' | ' |
Employee stock grants and employee stock plan purchases | 16,362 | 1 | 16,361 | ' | ' | ' |
Tax benefit from employee stock compensation | 3,141 | ' | 3,141 | ' | ' | ' |
Ending Balance at Dec. 31, 2012 | 782,314 | 47 | 285,524 | -457 | 500,200 | -3,000 |
Ending Balance, shares at Dec. 31, 2012 | 46,762,000 | 46,762,000 | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' |
Net income | 52,929 | ' | ' | ' | 52,929 | ' |
Other comprehensive income (loss), net of tax | -629 | ' | ' | -629 | ' | ' |
Purchase of treasury stock, shares | ' | -1,710,000 | ' | ' | ' | ' |
Purchase of treasury stock | -52,662 | -2 | ' | ' | ' | -52,660 |
Retirement of treasury stock, shares | ' | 0 | ' | ' | ' | ' |
Retirement of treasury stock | 0 | ' | -55,660 | ' | ' | 55,660 |
Issuance of warrants | 78,997 | ' | 78,997 | ' | ' | ' |
Employee stock grants and employee stock plan purchases, shares | 820,000 | 819,000 | ' | ' | ' | ' |
Employee stock grants and employee stock plan purchases | 30,386 | 1 | 30,385 | ' | ' | ' |
Tax benefit from employee stock compensation | 1,602 | ' | 1,602 | ' | ' | ' |
Ending Balance at Dec. 31, 2013 | $892,937 | $46 | $340,848 | ($1,086) | $553,129 | $0 |
Ending Balance, shares at Dec. 31, 2013 | ' | 45,871,000 | ' | ' | ' | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Operating activities: | ' | ' | ' |
Net income | $52,929 | $9,790 | $20,818 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Depreciation and amortization | 93,866 | 78,764 | 74,383 |
Deferred income taxes | -31,047 | -9,887 | 13,836 |
Stock-based compensation | 28,694 | 20,018 | 17,052 |
Amortization of convertible senior notes and lease financing obligations | 22,820 | 5,942 | 5,512 |
Amortization of premium/discount on investments | 11,787 | 6,746 | 7,242 |
Amortization of deferred financing costs | 3,692 | 1,089 | 2,818 |
Change in fair value of derivatives | 3,378 | 1,307 | 0 |
Change in fair value of contingent consideration liabilities | -2,400 | 0 | 0 |
Loss on disposal of property and equipment | 1,345 | 2,608 | 0 |
Tax deficiency from employee stock compensation | -73 | -526 | -714 |
Gain on sale of subsidiary | 0 | -1,747 | 0 |
Impairment of goodwill and intangible assets | 0 | 0 | 64,575 |
Gain on acquisition | 0 | 0 | -1,676 |
Changes in operating assets and liabilities: | ' | ' | ' |
Medical claims and benefits payable | 175,257 | 92,054 | 48,120 |
Receivables | -149,253 | 18,216 | 352 |
Accounts payable and accrued liabilities | 60,996 | 23,345 | 2,778 |
Income taxes | -39,262 | 18,172 | -24,855 |
Prepaid expenses and other current assets | -23,064 | -8,958 | 3,308 |
Deferred revenue | -19,582 | 90,851 | -8,154 |
Net cash provided by operating activities | 190,083 | 347,784 | 225,395 |
Investing activities: | ' | ' | ' |
Purchases of investments | -770,083 | -306,437 | -345,968 |
Sales and maturities of investments | 399,595 | 298,006 | 302,667 |
Purchases of equipment | -98,049 | -78,145 | -60,581 |
Net cash paid in business combinations | -61,521 | 0 | -84,253 |
Increase in restricted investments | -18,992 | -2,647 | -4,064 |
Change in deferred contract costs | 12,638 | -11,610 | -42,830 |
Proceeds from sale of subsidiary, net of cash surrendered | 0 | 9,162 | 0 |
Change in other noncurrent assets and liabilities | -6,899 | -1,913 | -1,898 |
Net cash used in investing activities | -543,311 | -93,584 | -236,927 |
Financing activities: | ' | ' | ' |
Proceeds from issuance of 1.125% Notes, net of deferred issuance costs | 537,973 | 0 | 0 |
Proceeds from sale-leaseback transactions | 158,694 | 0 | 0 |
Purchase of 1.125% Notes call option | -149,331 | 0 | 0 |
Proceeds from issuance of warrants | 75,074 | 0 | 0 |
Treasury stock purchases | -52,662 | -3,000 | -7,000 |
Principal payments on term loan | -47,471 | -1,129 | 0 |
Repayment of amount borrowed under credit facility | -40,000 | -20,000 | 0 |
Proceeds from employee stock plans | 9,402 | 8,205 | 7,347 |
Excess tax benefits from employee stock compensation | 1,674 | 3,667 | 1,651 |
Amount borrowed under credit facility | 0 | 60,000 | 0 |
Amount borrowed under term loan | 0 | 0 | 48,600 |
Credit facility fees paid | 0 | 0 | -1,125 |
Net cash provided by financing activities | 493,353 | 47,743 | 49,473 |
Net increase in cash and cash equivalents | 140,125 | 301,943 | 37,941 |
Cash and cash equivalents at beginning of period | 795,770 | 493,827 | 455,886 |
Cash and cash equivalents at end of period | 935,895 | 795,770 | 493,827 |
Supplemental cash flow information: | ' | ' | ' |
Income taxes | 95,240 | -4,634 | 54,663 |
Interest | 34,881 | 10,099 | 11,399 |
Schedule of non-cash investing and financing activities: | ' | ' | ' |
Retirement of treasury stock | 55,662 | 0 | 7,000 |
Common stock used for stock-based compensation | -7,711 | -11,862 | -3,926 |
Non-cash lease financing obligations - related party | 27,211 | 0 | 0 |
Change in fair value of derivatives | ' | ' | ' |
Fair value of assets acquired | -121,801 | 0 | -81,256 |
Fair value of contingent consideration liabilities incurred | 59,948 | 0 | 0 |
Payable to seller | 0 | 0 | -1,952 |
Decrease in fair value of liabilities assumed | 0 | 0 | -1,045 |
Escrow deposit | 332 | 0 | 0 |
Net cash paid in business combinations | -61,521 | 0 | -84,253 |
Details of change in fair value of derivatives: | ' | ' | ' |
Change in fair value of derivatives | -3,378 | -1,307 | 0 |
Details of sale of subsidiary: | ' | ' | ' |
Decrease in carrying value of assets | 0 | 30,942 | 0 |
Decrease in carrying value of liabilities | 0 | -23,527 | 0 |
Gain on sale | 0 | 1,747 | 0 |
Proceeds from sale of subsidiary, net of cash surrendered | 0 | 9,162 | 0 |
Gain on 1.125% Call Option | ' | ' | ' |
Details of change in fair value of derivatives: | ' | ' | ' |
Change in fair value of derivatives | 37,020 | 0 | 0 |
Loss on embedded cash conversion option | ' | ' | ' |
Details of change in fair value of derivatives: | ' | ' | ' |
Change in fair value of derivatives | -36,908 | 0 | 0 |
Loss on 1.125% Warrants | ' | ' | ' |
Details of change in fair value of derivatives: | ' | ' | ' |
Change in fair value of derivatives | -3,923 | 0 | 0 |
Gain (loss) on interest rate swap | ' | ' | ' |
Details of change in fair value of derivatives: | ' | ' | ' |
Change in fair value of derivatives | $433 | ($1,307) | $0 |
Basis_of_Presentation_Notes
Basis of Presentation (Notes) | 12 Months Ended | |
Dec. 31, 2013 | ||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |
Basis of Presentation | ' | |
Basis of Presentation | ||
Organization and Operations | ||
Molina Healthcare, Inc. provides quality and cost-effective Medicaid-related solutions to meet the health care needs of low-income families and individuals, and to assist state agencies in their administration of the Medicaid program. We report our financial performance based on two reportable segments: the Health Plans segment and the Molina Medicaid Solutions segment. | ||
Our Health Plans segment consists of health plans in 11 states, and includes our direct delivery business. As of December 31, 2013, these health plans served approximately 1.9 million members eligible for Medicaid, Medicare, and other government-sponsored health care programs for low-income families and individuals. The health plans are operated by our respective wholly owned subsidiaries in those states, each of which is licensed as a health maintenance organization (HMO). Our direct delivery business consists primarily of the operation of primary care clinics in California. | ||
Our health plans’ state Medicaid contracts generally have terms of three to four years with annual adjustments to premium rates. These contracts typically contain renewal options exercisable by the state Medicaid agency, and allow either the state or the health plan to terminate the contract with or without cause. Our health plan subsidiaries have generally been successful in retaining their contracts, but such contracts are subject to risk of loss when a state issues a new request for proposals (RFP) open to competitive bidding by other health plans. If one of our health plans is not a successful responsive bidder to a state RFP, its contract may be subject to non-renewal. | ||
Our Molina Medicaid Solutions segment provides business processing and information technology development and administrative services to Medicaid agencies in Idaho, Louisiana, Maine, New Jersey, West Virginia, and the U.S. Virgin Islands, and drug rebate administration services in Florida. | ||
Market Updates - Health Plans Segment | ||
California. In the fourth quarter of 2013, our California health plan entered into a settlement agreement with the California Department of Health Care Services. The agreement settled rate disputes initiated by our California health plan dating back to 2003 with respect to its participation in California’s Medicaid program. See Note 20, "Commitments and Contingencies," for further information. | ||
Florida. In the fourth quarter of 2013, our Florida health plan and the Florida Agency for Health Care Administration (AHCA), agreed to a settlement under which we have been awarded contracts to serve three regions under the Florida Statewide Medicaid Managed Care Managed Medical Assistance Invitation to Negotiate. The contracts are expected to commence in the second half of 2014. During 2014 we will also cease to serve members in three separate regions. As a result of these changes, we expect to experience a moderate increase in membership at our Florida health plan in 2014. | ||
Also in the fourth quarter of 2013, we began to serve approximately 3,000 members under the Florida's Statewide Medicaid Managed Care Long-Term Care Program. This program includes long-term care benefits, including institutional and home and community-based services. | ||
New Mexico. On August 1, 2013 our New Mexico health plan closed on its acquisition of the Lovelace Community Health Plan’s contract for the New Mexico Medicaid Salud! Program, under which Lovelace’s Medicaid members became Molina Healthcare Medicaid members. See Note 4, "Business Combinations," for further information. | ||
In the first quarter of 2013, we announced that our New Mexico health plan was selected by the New Mexico Human Services Department (HSD) to participate in the new Centennial Care program, which replaced and consolidated the state's legacy Medicaid programs effective January 1, 2014. In addition to continuing to provide physical and acute health care services, under the new program our New Mexico health plan expanded its services to provide behavioral health and long-term care services. The selection of our New Mexico health plan was made by HSD pursuant to its RFP issued in August 2012. | ||
South Carolina. In the third quarter of 2013, we entered into an agreement with Community Health Solutions of America, Inc. (CHS) to acquire certain assets, including the rights to convert certain of CHS’ Medicaid members covered by South Carolina’s full-risk Medicaid managed care program. See Note 4, "Business Combinations," for further information. | ||
Market Updates - Molina Medicaid Solutions Segment | ||
Maine. In the fourth quarter of 2013, Molina Medicaid Solutions of Maine entered into an agreement which, among other things, extended our MMIS contract with the state of Maine through August 2020. | ||
U.S. Virgin Islands and West Virginia. In 2012, Molina Medicaid Solutions of West Virginia secured a partnership with the United States Virgin Islands (USVI). The partnership involves processing the USVI’s Medicaid claims using West Virginia’s certified Medicaid management information system. On August 1, 2013 the system went live, marking the first Medicaid management information system (MMIS) for a U.S. Territory, and the first to be shared between two government agencies on a single business processing platform. | ||
Louisiana. In 2011, Molina Medicaid Solutions received notice from the state of Louisiana that the state intended to award the contract for a replacement MMIS to a different vendor, CNSI. However, in March 2013, the state of Louisiana cancelled its contract award to CNSI. CNSI is currently challenging the contract cancellation. The state has informed us that we will continue to perform under our current contract until a successor is named. At such time as a new RFP may be issued, we intend to respond to the state's RFP. For the year ended December 31, 2013, our revenue under the Louisiana MMIS contract was $40.5 million, or 19.8% of total service revenue. So long as our Louisiana MMIS contract continues, we expect to recognize $40 million of service revenue annually under this contract. | ||
Consolidation | ||
The consolidated financial statements include the accounts of Molina Healthcare, Inc., its subsidiaries, and variable interest entities in which Molina Healthcare, Inc. is considered to be the primary beneficiary. See Note 19, “Variable Interest Entities,” for more information regarding these variable interest entities. In the opinion of management, all adjustments considered necessary for a fair presentation of the results as of the date and for the periods presented have been included; such adjustments consist of normal recurring adjustments. All significant inter-company balances and transactions have been eliminated in consolidation. Financial information related to subsidiaries acquired during any year is included only for periods subsequent to their acquisition. | ||
Presentation and Reclassifications | ||
We previously reported that our Medicaid managed care contract with the state of Missouri expired without renewal on June 30, 2012. Effective June 30, 2013, the transition obligations associated with that contract terminated. Therefore, we have reclassified the results relating to the Missouri health plan to discontinued operations for all periods presented. These results are presented in a single line item, net of taxes, in the consolidated statements of income. Additionally, we abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is also included in discontinued operations in the consolidated statements of income. The Missouri health plan's premium revenues amounted to $0.2 million, $114.4 million and $229.6 million for the years ended December 31, 2013, 2012 and 2011, respectively. | ||
We have reclassified certain amounts in the 2012 consolidated balance sheet, and 2012 and 2011 statements of income and cash flows to conform to the 2013 presentation, including the presentation of premium tax revenue as a separate line item in the consolidated statements of income. | ||
Use of Estimates | ||
The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements. Estimates also affect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Principal areas requiring the use of estimates include: | ||
• | Health plan contractual provisions that may limit revenue based upon the costs incurred or the profits realized under a specific contract; | |
• | Health plan quality incentives that allow us to recognize incremental revenue if certain quality standards are met; | |
• | The determination of medical claims and benefits payable of our Health Plans segment; | |
• | The valuation of certain investments; | |
• | Settlements under risk or savings sharing programs; | |
• | The assessment of deferred contract costs, deferred revenue, long-lived and intangible assets, and goodwill for impairment; | |
• | The determination of professional and general liability claims, and reserves for potential absorption of claims unpaid by insolvent providers; | |
• | The determination of reserves for the outcome of litigation; | |
• | The determination of valuation allowances for deferred tax assets; and | |
• | The determination of unrecognized tax benefits. |
Significant_Accounting_Policie
Significant Accounting Policies (Notes) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||||||||||||||||||
Significant Accounting Policies | ' | ||||||||||||||||||||||||||||||||
Significant Accounting Policies | |||||||||||||||||||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||||||||||||||||||
Cash and cash equivalents consist of cash and short-term, highly liquid investments that are both readily convertible into known amounts of cash and have a maturity of three months or less on the date of purchase. | |||||||||||||||||||||||||||||||||
Investments | |||||||||||||||||||||||||||||||||
Our investments are principally held in debt securities, which are grouped into two separate categories for accounting and reporting purposes: available-for-sale securities, and held-to-maturity securities. Available-for-sale securities are recorded at fair value and unrealized gains and losses, if any, are recorded in stockholders’ equity as other comprehensive income, net of applicable income taxes. Held-to-maturity securities are recorded at amortized cost, which approximates fair value, and unrealized holding gains or losses are not generally recognized. Realized gains and losses and unrealized losses judged to be other than temporary with respect to available-for-sale and held-to-maturity securities are included in the determination of net income. The cost of securities sold is determined using the specific-identification method, on an amortized cost basis. | |||||||||||||||||||||||||||||||||
Our investment policy requires that all of our investments have final maturities of five years or less (excluding auction rate and variable rate securities where interest rates may be periodically reset), and that the average maturity be two years or less. Investments and restricted investments are subject to interest rate risk and will decrease in value if market rates increase. Declines in interest rates over time will reduce our investment income. | |||||||||||||||||||||||||||||||||
In general, our available-for-sale securities are classified as current assets without regard to the securities’ contractual maturity dates because they may be readily liquidated. Our auction rate securities are classified as non-current assets. For comprehensive discussions of the fair value and classification of our current and non-current investments, including auction rate securities, see Note 5, “Fair Value Measurements,” Note 6, “Investments,” and Note 10, “Restricted Investments.” | |||||||||||||||||||||||||||||||||
Receivables | |||||||||||||||||||||||||||||||||
Receivables are readily determinable, our creditors are primarily state governments, and our allowance for doubtful accounts is immaterial. Any amounts determined to be uncollectible are charged to expense when such determination is made. See Note 7, "Receivables." | |||||||||||||||||||||||||||||||||
Property, Equipment, and Capitalized Software | |||||||||||||||||||||||||||||||||
Property and equipment are stated at historical cost. Replacements and major improvements are capitalized, and repairs and maintenance are charged to expense as incurred. Furniture and equipment are generally depreciated using the straight-line method over estimated useful lives ranging from three to seven years. Software developed for internal use is capitalized. Software is generally amortized over its estimated useful life of three years. Leasehold improvements are amortized over the term of the lease, or over their useful lives from five to 10 years, whichever is shorter. Buildings are depreciated over their estimated useful lives of 31.5 to 40 years. See Note 8, “Property, Equipment, and Capitalized Software.” | |||||||||||||||||||||||||||||||||
As discussed below, the costs associated with certain of our Molina Medicaid Solutions segment equipment and software are capitalized and recorded as deferred contract costs. Such costs are amortized on a straight-line basis over the shorter of the useful life or the contract period. | |||||||||||||||||||||||||||||||||
Depreciation and Amortization | |||||||||||||||||||||||||||||||||
Depreciation and amortization related to our Health Plans segment is all recorded in “Depreciation and Amortization” in the consolidated statements of income. Depreciation and amortization related to our Molina Medicaid Solutions segment is recorded within three different headings in the consolidated statements of income as follows: | |||||||||||||||||||||||||||||||||
• | Amortization of purchased intangibles relating to customer relationships is reported as amortization within the heading “Depreciation and amortization;” | ||||||||||||||||||||||||||||||||
• | Amortization of purchased intangibles relating to contract backlog is recorded as a reduction of “Service revenue;” and | ||||||||||||||||||||||||||||||||
• | Amortization of capitalized software is recorded within the heading “Cost of service revenue.” | ||||||||||||||||||||||||||||||||
The following table presents all depreciation and amortization recorded in our consolidated statements of income, regardless of whether the item appears as depreciation and amortization, a reduction of revenue, or as cost of service revenue. | |||||||||||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||
Depreciation, and amortization of capitalized software, continuing operations | $ | 54,837 | $ | 42,938 | $ | 30,803 | |||||||||||||||||||||||||||
Amortization of intangible assets, continuing operations | 17,906 | 20,176 | 17,450 | ||||||||||||||||||||||||||||||
Depreciation and amortization, continuing operations | 72,743 | 63,114 | 48,253 | ||||||||||||||||||||||||||||||
Depreciation and amortization, discontinued operations | 2 | 590 | 2,437 | ||||||||||||||||||||||||||||||
Amortization recorded as reduction of service revenue | 2,914 | 1,571 | 6,822 | ||||||||||||||||||||||||||||||
Amortization of capitalized software recorded as cost of service revenue | 18,207 | 13,489 | 16,871 | ||||||||||||||||||||||||||||||
Total | $ | 93,866 | $ | 78,764 | $ | 74,383 | |||||||||||||||||||||||||||
Long-Lived Assets, including Intangible Assets | |||||||||||||||||||||||||||||||||
Long-lived assets comprise primarily property, equipment, capitalized software and intangible assets. Finite-lived, separately-identifiable intangible assets are acquired in business combinations and are assets that represent future expected benefits but lack physical substance (such as purchased contract rights and provider contracts). Intangible assets are initially recorded at their fair values and are then amortized on a straight-line basis over their expected useful lives, generally between one and 15 years. | |||||||||||||||||||||||||||||||||
Identifiable intangible assets associated with Molina Medicaid Solutions are classified as either contract backlog or customer relationships as follows: | |||||||||||||||||||||||||||||||||
• | The contract backlog intangible asset comprises all contractual cash flows anticipated to be received during the remaining contracted period for each specific contract relating to work that was performed prior to acquisition. Because each acquired contract constitutes a single revenue stream, amortization of the contract backlog intangible is recorded to contra-service revenue so that amortization is matched to any revenues associated with contract performance that occurred prior to the acquisition date. The contract backlog intangible asset is amortized on a straight-line basis for each specific contract over periods generally ranging from one to six years. The contract backlog intangible assets will be fully amortized in 2015. | ||||||||||||||||||||||||||||||||
• | The customer relationship intangible asset comprises all contractual cash flows that are anticipated to be received during the option periods of each specific contract as well as anticipated renewals of those contracts. The customer relationship intangible is amortized on a straight-line basis for each specific contract over periods generally ranging from four to nine years. | ||||||||||||||||||||||||||||||||
Our intangible assets are subject to impairment tests when events or circumstances indicate that a finite-lived intangible asset’s (or asset group’s) carrying value may not be recoverable. Consideration is given to a number of potential impairment indicators. For example, our health plan subsidiaries have generally been successful in obtaining the renewal by amendment of their contracts in each state prior to the actual expiration of their contracts. However, there can be no assurance that these contracts will continue to be renewed as in the case of our Missouri health plan, described below. | |||||||||||||||||||||||||||||||||
Following the identification of any potential impairment indicators, to determine whether an impairment exists, we would compare the carrying amount of a finite-lived intangible asset with the undiscounted cash flows that are expected to result from the use of the asset or related group of assets. If it is determined that the carrying amount of the asset is not recoverable, the amount by which the carrying value exceeds the estimated fair value is recorded as an impairment. | |||||||||||||||||||||||||||||||||
On February 17, 2012, we received notification that our Missouri Health plan's contract with the state of Missouri would expire without renewal on June 30, 2012. As a result, we recorded a total non-cash impairment charge of $64.6 million in the fourth quarter of 2011, of which $6.1 million related to finite-lived intangible assets, and $58.5 million related to goodwill, discussed below. The impairment charge comprised substantially all intangible assets relating to contract rights and licenses, and provider networks recorded at the time of our acquisition of the Missouri health plan in 2007. The non-cash impairment charge is included in the discontinued operations line item, net of tax, in the statement of income. No significant impairment charges relating to long-lived assets, including intangible assets, were recorded in the years ended December 31, 2013, and 2012. | |||||||||||||||||||||||||||||||||
Goodwill | |||||||||||||||||||||||||||||||||
Goodwill represents the amount of the purchase price in excess of the fair values assigned to the underlying identifiable net assets of acquired businesses. Goodwill is not amortized, but is subject to an annual impairment test. Tests are performed more frequently if events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. | |||||||||||||||||||||||||||||||||
To determine whether goodwill is impaired, we measure the fair values of our reporting units and compare them to the carrying values of the respective units, including goodwill. If the fair value is less than the carrying value of the reporting unit, then the implied value of goodwill would be calculated and compared to the carrying amount of goodwill to determine whether goodwill is impaired. | |||||||||||||||||||||||||||||||||
We estimate the fair values of our reporting units using discounted cash flows. To determine fair values, we must make assumptions about a wide variety of internal and external factors. Significant assumptions used in the impairment analysis include financial projections of free cash flow (including significant assumptions about operations, capital requirements and income taxes), long-term growth rates for determining terminal value, and discount rates. | |||||||||||||||||||||||||||||||||
In connection with our Missouri health plan as described above, we recorded a non-cash impairment charge of $58.5 million in the fourth quarter of 2011, which is included in the discontinued operations line item, net of taxes, in the statement of income. The impairment charge comprised all of the goodwill recorded at the time of our acquisition of the Missouri health plan in 2007, and was not tax deductible. No impairment charges relating to goodwill were recorded in the years ended December 31, 2013, and 2012. | |||||||||||||||||||||||||||||||||
Restricted Investments | |||||||||||||||||||||||||||||||||
Restricted investments, which consist of certificates of deposit and treasury securities, are designated as held-to-maturity and are carried at amortized cost, which approximates market value. The use of these funds is limited to specific purposes as required by each state, or as protection against the insolvency of capitated providers. We have the ability to hold our restricted investments until maturity and, as a result, we would not expect the value of these investments to decline significantly due to a sudden change in market interest rates. See Note 10, “Restricted Investments.” | |||||||||||||||||||||||||||||||||
Other Assets | |||||||||||||||||||||||||||||||||
Other assets primarily includes deferred financing costs associated with our convertible senior notes and lease financing obligations, and certain investments held in connection with our employee deferred compensation program. The deferred financing costs are being amortized on a straight-line basis over the terms of the convertible senior notes and lease financing obligations. | |||||||||||||||||||||||||||||||||
Delegated Provider Insolvency | |||||||||||||||||||||||||||||||||
Circumstances may arise where providers to whom we have delegated risk are unable to pay claims they have incurred with third parties in connection with referral services (including hospital inpatient services) provided to our members. The inability of delegated providers to pay referral claims presents us with both immediate financial risk and potential disruption to member care. Depending on states’ laws, we may be held liable for such unpaid referral claims even though the delegated provider has contractually assumed such risk. Additionally, competitive pressures may force us to pay such claims even when we have no legal obligation to do so. To reduce the risk that delegated providers are unable to pay referral claims, we monitor the operational and financial performance of such providers. We also maintain contingency plans that include transferring members to other providers in response to potential network instability. | |||||||||||||||||||||||||||||||||
In certain instances, we have required providers to place funds on deposit with us as protection against their potential insolvency. These reserves are frequently in the form of segregated funds received from the provider and held by us or placed in a third-party financial institution. These funds may be used to pay claims that are the financial responsibility of the provider in the event the provider is unable to meet these obligations. Additionally, we have recorded liabilities for estimated losses arising from provider instability or insolvency in excess of provider funds on deposit with us. Such liabilities were not material at December 31, 2013 and 2012. | |||||||||||||||||||||||||||||||||
Premium Revenue | |||||||||||||||||||||||||||||||||
Premium revenue is fixed in advance of the periods covered and, except as described below, is not generally subject to significant accounting estimates. For the year ended December 31, 2013, we received approximately 97% of our premium revenue as a fixed amount per member per month (PMPM), pursuant to our contracts with state Medicaid agencies, Medicare and other managed care organizations for which we operate as a subcontractor. These premium revenues are recognized in the month that members are entitled to receive health care services. The state Medicaid programs and the federal Medicare program periodically adjust premium rates. | |||||||||||||||||||||||||||||||||
The following table summarizes premium revenue from continuing operations for the periods indicated: | |||||||||||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
California | $ | 749,755 | 12.1 | % | $ | 665,600 | 12 | % | $ | 567,677 | 13.5 | % | |||||||||||||||||||||
Florida | 264,998 | 4.3 | 228,832 | 4.1 | 203,904 | 4.8 | |||||||||||||||||||||||||||
Illinois | 8,121 | 0.1 | — | — | — | — | |||||||||||||||||||||||||||
Michigan | 676,000 | 11 | 646,551 | 11.7 | 623,394 | 14.8 | |||||||||||||||||||||||||||
New Mexico | 446,758 | 7.2 | 321,853 | 5.8 | 328,706 | 7.8 | |||||||||||||||||||||||||||
Ohio | 1,098,795 | 17.8 | 1,095,137 | 19.7 | 912,219 | 21.7 | |||||||||||||||||||||||||||
Texas | 1,291,001 | 20.9 | 1,233,621 | 22.2 | 402,178 | 9.5 | |||||||||||||||||||||||||||
Utah | 310,895 | 5 | 298,392 | 5.4 | 287,290 | 6.8 | |||||||||||||||||||||||||||
Washington | 1,168,405 | 18.9 | 974,712 | 17.6 | 808,458 | 19.2 | |||||||||||||||||||||||||||
Wisconsin | 143,465 | 2.3 | 70,678 | 1.3 | 69,552 | 1.7 | |||||||||||||||||||||||||||
Direct delivery | 20,977 | 0.4 | 8,745 | 0.2 | 8,115 | 0.2 | |||||||||||||||||||||||||||
$ | 6,179,170 | 100 | % | $ | 5,544,121 | 100 | % | $ | 4,211,493 | 100 | % | ||||||||||||||||||||||
For the year ended December 31, 2013, we recognized approximately 3% of our premium revenue in the form of “birth income” — a one-time payment for the delivery of a child — from the Medicaid programs in all of our state health plans except New Mexico. Such payments are recognized as revenue in the month the birth occurs. | |||||||||||||||||||||||||||||||||
Certain components of premium revenue are subject to accounting estimates. The components of premium revenue subject to estimation fall into two categories: | |||||||||||||||||||||||||||||||||
(1) Contractual provisions that may limit revenue based upon the costs incurred or the profits realized under a specific contract. | |||||||||||||||||||||||||||||||||
These are contractual provisions that require the health plan to return premiums to the extent that certain thresholds are not met. In some instances premiums are returned when medical costs fall below a certain percentage of gross premiums; or when administrative costs or profits exceed a certain percentage of gross premiums. In other instances, premiums are partially determined by the acuity of care provided to members (risk adjustment). To the extent that our expenses and profits change from the amounts previously reported (due to changes in estimates) our revenue earned for those periods will also change. In all of these instances our revenue is only subject to estimate due to the fact that the thresholds themselves contain elements (expense or profit) that are subject to estimate. While we have adequate experience and data to make sound estimates of our expenses or profits, changes to those estimates may be necessary, which in turn would lead to changes in our estimates of revenue. In general, a change in estimate relating to expense or profit would offset any related change in estimate to premium, resulting in no or small impact to net income. | |||||||||||||||||||||||||||||||||
Health Plan Medical Cost Floors (Minimums), and Administrative Cost and Profit Ceilings (Maximums): A portion of certain premiums received by our California, Florida, Illinois, New Mexico, and Washington health plans may be returned to the state if certain minimum amounts are not spent on defined medical care costs, or if administrative costs or profits exceed certain amounts. In Ohio, the state may levy sanctions on us if certain minimum amounts are not spent on defined medical care costs. In the aggregate, we recorded a liability under the terms of such contract provisions of $1.4 million and $0.3 million at December 31, 2013, and December 31, 2012, respectively. | |||||||||||||||||||||||||||||||||
Texas Health Plan Profit Sharing: Under our contract with the state of Texas, there is a profit-sharing agreement under which we pay a rebate to the state of Texas if our Texas health plan generates pretax income, as defined in the contract, above a certain specified percentage, as determined in accordance with a tiered rebate schedule. We are limited in the amount of administrative costs that we may deduct in calculating the rebate, if any. As a result of profits in excess of the amount we are allowed to fully retain, we had accrued an aggregate liability of $2.5 million and $3.2 million pursuant to our profit-sharing agreement with the state of Texas at December 31, 2013 and December 31, 2012, respectively. | |||||||||||||||||||||||||||||||||
Medicare Revenue Risk Adjustment: Based on member encounter data that we submit to CMS, our Medicare premiums are subject to retroactive adjustment for both member risk scores and member pharmacy cost experience for up to two years after the original year of service. This adjustment takes into account the acuity of each member’s medical needs relative to what was anticipated when premiums were originally set for that member. In the event that a member requires less acute medical care than was anticipated by the original premium amount, CMS may recover premium from us. In the event that a member requires more acute medical care than was anticipated by the original premium amount, CMS may pay us additional retroactive premium. A similar retroactive reconciliation is undertaken by CMS for our Medicare members’ pharmacy utilization. We estimate the amount of Medicare revenue that will ultimately be realized for the periods presented based on our knowledge of our members’ health care utilization patterns and CMS practices. Based on our knowledge of member health care utilization patterns and expenses we have recorded a net receivable of $20.8 million and $0.3 million for anticipated Medicare risk adjustment premiums at December 31, 2013 and December 31, 2012, respectively. | |||||||||||||||||||||||||||||||||
(2) Quality incentives that allow us to recognize incremental revenue if certain quality standards are met. | |||||||||||||||||||||||||||||||||
At our New Mexico, Ohio, Texas and Wisconsin health plans, incremental revenue ranging from 0.75% to 5.00% of health plan premiums is earned if certain performance measures are met. We estimate the amount of revenue that will ultimately be realized for the periods presented based on our experience and expertise in meeting the quality and administrative measures as well as our ongoing and current monitoring of our progress in meeting those measures. The amount of the revenue that we will realize under these contractual provisions is determinable based upon that experience. | |||||||||||||||||||||||||||||||||
The following table quantifies the quality incentive premium revenue recognized for the periods presented, including the amounts earned in the period presented and prior periods. Although the reasonably possible effects of a change in estimate related to quality incentive premium revenue as of December 31, 2013 are not known, we have no reason to believe that the adjustments to prior years noted below are not indicative of the potential future changes in our estimates as of December 31, 2013. | |||||||||||||||||||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||||||||||||||||||
Maximum | Amount of | Amount of | Total Quality | Total Premium Revenue | |||||||||||||||||||||||||||||
Available Quality | Current Year | Quality Incentive | Incentive | Recognized | |||||||||||||||||||||||||||||
Incentive | Quality Incentive | Premium Revenue | Premium Revenue | ||||||||||||||||||||||||||||||
Premium – | Premium Revenue | Recognized from | Recognized | ||||||||||||||||||||||||||||||
Current Year | Recognized | Prior Year | |||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||
New Mexico | $ | 3,113 | $ | 2,618 | $ | 154 | $ | 2,772 | $ | 446,758 | |||||||||||||||||||||||
Ohio | 12,093 | 3,465 | 606 | 4,071 | 1,098,795 | ||||||||||||||||||||||||||||
Texas | 43,688 | 37,053 | 5,995 | 43,048 | 1,291,001 | ||||||||||||||||||||||||||||
Wisconsin | 4,417 | 2,667 | 2,301 | 4,968 | 143,465 | ||||||||||||||||||||||||||||
$ | 63,311 | $ | 45,803 | $ | 9,056 | $ | 54,859 | $ | 2,980,019 | ||||||||||||||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||||||||||||
Maximum | Amount of | Amount of | Total Quality | Total Premium Revenue | |||||||||||||||||||||||||||||
Available Quality | Current Year | Quality Incentive | Incentive | Recognized | |||||||||||||||||||||||||||||
Incentive | Quality Incentive | Premium Revenue | Premium Revenue | ||||||||||||||||||||||||||||||
Premium – | Premium Revenue | Recognized from | Recognized | ||||||||||||||||||||||||||||||
Current Year | Recognized | Prior Year | |||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||
New Mexico | $ | 2,244 | $ | 1,889 | $ | 643 | $ | 2,532 | $ | 321,853 | |||||||||||||||||||||||
Ohio | 12,033 | 8,079 | 966 | 9,045 | 1,095,137 | ||||||||||||||||||||||||||||
Texas | 58,516 | 52,521 | — | 52,521 | 1,233,621 | ||||||||||||||||||||||||||||
Wisconsin | 1,771 | — | 593 | 593 | 70,678 | ||||||||||||||||||||||||||||
$ | 74,564 | $ | 62,489 | $ | 2,202 | $ | 64,691 | $ | 2,721,289 | ||||||||||||||||||||||||
Year Ended December 31, 2011 | |||||||||||||||||||||||||||||||||
Maximum | Amount of | Amount of | Total Quality | Total Premium Revenue | |||||||||||||||||||||||||||||
Available Quality | Current Year | Quality Incentive | Incentive | Recognized | |||||||||||||||||||||||||||||
Incentive | Quality Incentive | Premium Revenue | Premium Revenue | ||||||||||||||||||||||||||||||
Premium – | Premium Revenue | Recognized from | Recognized | ||||||||||||||||||||||||||||||
Current Year | Recognized | Prior Year | |||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||
New Mexico | $ | 2,271 | $ | 1,558 | $ | 378 | $ | 1,936 | $ | 328,706 | |||||||||||||||||||||||
Ohio | 10,212 | 8,363 | 3,501 | 11,864 | 912,219 | ||||||||||||||||||||||||||||
Texas | — | — | — | — | 402,178 | ||||||||||||||||||||||||||||
Wisconsin | 1,705 | 542 | — | 542 | 69,552 | ||||||||||||||||||||||||||||
$ | 14,188 | $ | 10,463 | $ | 3,879 | $ | 14,342 | $ | 1,712,655 | ||||||||||||||||||||||||
Medical Care Costs | |||||||||||||||||||||||||||||||||
Expenses related to medical care services are captured in the following categories: | |||||||||||||||||||||||||||||||||
• | Fee-for-service: Nearly all hospital services and the majority of our primary care and physician specialist services are paid on a fee-for-service basis. Under all fee-for-service arrangements, we retain the financial responsibility for medical care provided. Expenses related to fee-for-service contracts are recorded in the period in which the related services are dispensed. The costs of drugs administered in a physician or hospital setting that are not billed through our pharmacy benefit manager are included in fee-for-service costs. | ||||||||||||||||||||||||||||||||
• | Capitation: Many of our primary care physicians and a small portion of our specialists and hospitals are paid on a capitated basis. Under capitation contracts, we typically pay a fixed PMPM payment to the provider without regard to the frequency, extent, or nature of the medical services actually furnished. Under capitated contracts, we remain liable for the provision of certain health care services. Capitation payments are fixed in advance of the periods covered and are not subject to significant accounting estimates. These payments are expensed in the period the providers are obligated to provide services. The financial risk for pharmacy services for a small portion of our membership is delegated to capitated providers. | ||||||||||||||||||||||||||||||||
• | Pharmacy: Pharmacy costs include all drug, injectibles, and immunization costs paid through our pharmacy benefit manager. As noted above, drugs and injectibles not paid through our pharmacy benefit manager are included in fee-for-service costs, except in those limited instances where we capitate drug and injectible costs. | ||||||||||||||||||||||||||||||||
• | Direct delivery: Costs associated with our operation and/or management of primary care clinics and hospital services in California, Florida, New Mexico, Virginia, and Washington. | ||||||||||||||||||||||||||||||||
• | Other: Other medical care costs include medically related administrative costs, certain provider incentive costs, reinsurance cost, and other health care expense. Medically related administrative costs include, for example, expenses relating to health education, quality assurance, case management, disease management, and 24-hour on-call nurses. Salary and benefit costs are a substantial portion of these expenses. For the years ended December 31, 2013, 2012, and 2011, medically related administrative costs were $153.0 million, $125.2 million, and $99.3 million, respectively. | ||||||||||||||||||||||||||||||||
The following table provides the details of our consolidated medical care costs from continuing operations for the periods indicated (dollars in thousands, except PMPM amounts): | |||||||||||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||||||||||
Amount | PMPM | % of | Amount | PMPM | % of | Amount | PMPM | % of | |||||||||||||||||||||||||
Total | Total | Total | |||||||||||||||||||||||||||||||
Fee-for-service | $ | 3,611,529 | $ | 160.43 | 67.1 | % | $ | 3,423,751 | $ | 161.67 | 68.6 | % | $ | 2,587,380 | $ | 136.72 | 70.6 | % | |||||||||||||||
Pharmacy | 935,204 | 41.54 | 17.4 | 835,830 | 39.47 | 16.7 | 418,019 | 22.09 | 11.4 | ||||||||||||||||||||||||
Capitation | 603,938 | 26.83 | 11.2 | 552,136 | 26.07 | 11.1 | 505,892 | 26.73 | 13.8 | ||||||||||||||||||||||||
Direct delivery | 48,288 | 2.14 | 0.9 | 33,920 | 1.6 | 0.7 | 29,683 | 1.57 | 0.8 | ||||||||||||||||||||||||
Other | 181,165 | 8.05 | 3.4 | 145,551 | 6.87 | 2.9 | 123,187 | 6.51 | 3.4 | ||||||||||||||||||||||||
Total | $ | 5,380,124 | $ | 238.99 | 100 | % | $ | 4,991,188 | $ | 235.68 | 100 | % | $ | 3,664,161 | $ | 193.62 | 100 | % | |||||||||||||||
The Missouri health plan's medical care costs, which are not included in the table above, amounted to $1.5 million, $105.6 million, and $195.8 million for the years ended December 31, 2013, 2012, and 2011, respectively. | |||||||||||||||||||||||||||||||||
Our medical care costs include amounts that have been paid by us through the reporting date, as well as estimated liabilities for medical care costs incurred but not paid by us as of the reporting date. Such medical care cost liabilities include, among other items, unpaid fee-for-service claims, capitation payments owed providers, unpaid pharmacy invoices, and various medically related administrative costs that have been incurred but not paid. We use judgment to determine the appropriate assumptions for determining the required estimates. | |||||||||||||||||||||||||||||||||
The most important element in estimating our medical care costs is our estimate for fee-for-service claims which have been incurred but not paid by us. These fee-for-service costs that have been incurred but have not been paid at the reporting date are collectively referred to as medical costs that are incurred but not paid (IBNP). Our IBNP claims reserve, as reported in our balance sheet, represents our best estimate of the total amount of claims we will ultimately pay with respect to claims that we have incurred as of the balance sheet date. We estimate our IBNP monthly using actuarial methods based on a number of factors. For further information, see Note 11, “Medical Claims and Benefits Payable.” | |||||||||||||||||||||||||||||||||
We report reinsurance premiums as medical care costs, while related reinsurance recoveries are reported as deductions from medical care costs. We limit our risk of catastrophic losses by maintaining high deductible reinsurance coverage. We do not consider this coverage to be material because the cost is not significant and the likelihood that coverage will apply is low. | |||||||||||||||||||||||||||||||||
Taxes Based on Premiums | |||||||||||||||||||||||||||||||||
Certain of our health plans are assessed a tax based on premium revenue collected. The premium revenues we receive from these states include the premium tax assessment. We have reported these taxes on a gross basis, as premium tax revenue and as premium tax expense in the consolidated statements of income. Prior to 2013, premium tax revenue was included in premium revenue. The presentation change affected only premium revenue amounts previously reported, by reducing premium revenue for the amount now included in premium tax revenue. There is no effect on income from continuing operations, net income, or per-share amounts. This change was made to more clearly present the portion of premium revenue paid to us as a result of a related premium tax, and therefore not available to the general operations of our health plans. All prior periods presented have been adjusted to conform to this presentation. | |||||||||||||||||||||||||||||||||
Premium Deficiency Reserves on Loss Contracts | |||||||||||||||||||||||||||||||||
We assess the profitability of our contracts for providing medical care services to our members and identify those contracts where current operating results or forecasts indicate probable future losses. Anticipated future premiums are compared to anticipated medical care costs, including the cost of processing claims. If the anticipated future costs exceed the premiums, a loss contract accrual is recognized. No such accrual was recorded as of December 31, 2013, or 2012. | |||||||||||||||||||||||||||||||||
Service Revenue and Cost of Service Revenue — Molina Medicaid Solutions Segment | |||||||||||||||||||||||||||||||||
The payments received by our Molina Medicaid Solutions segment under its state contracts are based on the performance of multiple services. The first of these is the design, development and implementation (DDI), of a MMIS. An additional service, following completion of DDI, is the operation of the MMIS under a business process outsourcing (BPO) arrangement. While providing BPO services (which include claims payment and eligibility processing) we also provide the state with other services including both hosting and support and maintenance. Our Molina Medicaid Solutions contracts may extend over a number of years, particularly in circumstances where we deliver extensive and complex DDI services, such as the initial design, development and implementation of a complete MMIS. We receive progress payments from the state during the performance of DDI services based upon the attainment of predetermined milestones. Following the completion of DDI, we generally receive a flat monthly payment for BPO services. | |||||||||||||||||||||||||||||||||
We have evaluated our Molina Medicaid Solutions contracts to determine if such arrangements include a software element. Based on this evaluation, we have concluded that these arrangements do not include a software element, and are therefore multiple-element service arrangements. | |||||||||||||||||||||||||||||||||
Additionally, we evaluate each required deliverable under our multiple-element service arrangements to determine whether it qualifies as a separate unit of accounting. Such evaluation is generally based on whether the deliverable has standalone value to the customer. If the deliverable has standalone value, the arrangement’s consideration that is fixed or determinable is then allocated to each separate unit of accounting based on the relative selling price of each deliverable. In general, the consideration allocated to each unit of accounting is recognized as the related goods or services are delivered, limited to the consideration that is not contingent. | |||||||||||||||||||||||||||||||||
We have concluded that the various service elements in our Molina Medicaid Solutions contracts represent a single unit of accounting due to the fact that DDI, which is the only service performed in advance of the other services (all other services are performed over an identical period), does not have standalone value because our DDI services are not sold separately by any vendor and the customer could not resell our DDI services. Further, we have no objective and reliable evidence of fair value for any of the individual elements in these contracts, and at no point in the contract will we have objective and reliable evidence of fair value for the undelivered elements in the contracts. We lack objective and reliable evidence of the fair value of the individual elements of our Molina Medicaid Solutions contracts for the following reasons: | |||||||||||||||||||||||||||||||||
• | Each contract calls for the provision of its own specific set of services. While all contracts support the system of record for state MMIS, the actual services we provide vary significantly between contracts; and | ||||||||||||||||||||||||||||||||
• | The nature of the MMIS installed varies significantly between our older contracts (proprietary mainframe systems) and our new contracts (commercial off-the-shelf technology solutions). | ||||||||||||||||||||||||||||||||
Because we have determined the services provided under our Molina Medicaid Solutions contracts represent a single unit of accounting, and because we are unable to determine a pattern of performance of services during the contract period, we recognize all revenue (both the DDI and BPO elements) associated with such contracts on a straight-line basis over the period during which BPO, hosting, and support and maintenance services are delivered. Therefore, absent any contingencies as discussed in the following paragraph, or contract extensions, we would recognize all revenue associated with those contracts over the initial contract period. When a contract is extended, we generally consider the extension to be a continuation of the single unit of accounting; therefore, the deferred revenue as of the extension date is recognized prospectively over the new remaining term of the contract. In cases where there is no DDI element associated with our contracts, BPO revenue is recognized on a monthly basis as specified in the applicable contract or contract extension. | |||||||||||||||||||||||||||||||||
Provisions specific to each contract may, however, lead us to modify this general principle. In those circumstances, the right of the state to refuse acceptance of services, as well as the related obligation to compensate us, may require us to delay recognition of all or part of our revenue until that contingency (the right of the state to refuse acceptance) has been removed. In those circumstances, we defer recognition of any contingent revenue (whether DDI, BPO services, hosting, and support and maintenance services) until the contingency has been removed. These types of contingency features are present in our Maine and Idaho contracts, for example. In those states, we deferred recognition of revenue until the contingencies were removed. | |||||||||||||||||||||||||||||||||
Costs associated with our Molina Medicaid Solutions contracts include software related costs and other costs. With respect to software related costs, we apply the guidance for internal-use software and capitalize external direct costs of materials and services consumed in developing or obtaining the software, and payroll and payroll-related costs associated with employees who are directly associated with and who devote time to the computer software project. With respect to all other direct costs, such costs are expensed as incurred, unless corresponding revenue is being deferred. If revenue is being deferred, direct costs relating to delivered service elements are deferred as well and are recognized on a straight-line basis over the period of revenue recognition, in a manner consistent with our recognition of revenue that has been deferred. Such direct costs can include: | |||||||||||||||||||||||||||||||||
• | Transaction processing costs; | ||||||||||||||||||||||||||||||||
• | Employee costs incurred in performing transaction services; | ||||||||||||||||||||||||||||||||
• | Vendor costs incurred in performing transaction services; | ||||||||||||||||||||||||||||||||
• | Costs incurred in performing required monitoring of and reporting on contract performance; | ||||||||||||||||||||||||||||||||
• | Costs incurred in maintaining and processing member and provider eligibility; and | ||||||||||||||||||||||||||||||||
• | Costs incurred in communicating with members and providers. | ||||||||||||||||||||||||||||||||
The recoverability of deferred contract costs associated with a particular contract is analyzed on a periodic basis using the undiscounted estimated cash flows of the whole contract over its remaining contract term. If such undiscounted cash flows are insufficient to recover the long-lived assets and deferred contract costs, the deferred contract costs are written down by the amount of the cash flow deficiency. If a cash flow deficiency remains after reducing the balance of the deferred contract costs to zero, any remaining long-lived assets are evaluated for impairment. Any such impairment recognized would equal the amount by which the carrying value of the long-lived assets exceeds the fair value of those assets. | |||||||||||||||||||||||||||||||||
Income Taxes | |||||||||||||||||||||||||||||||||
The provision for income taxes is determined using an estimated annual effective tax rate, which is generally greater than the U.S. federal statutory rate primarily because of state taxes and nondeductible compensation and other general and administrative expenses. The effective tax rate may be subject to fluctuations during the year as new information is obtained. Such information may affect the assumptions used to estimate the annual effective tax rate, including factors such as the mix of pretax earnings in the various tax jurisdictions in which we operate, valuation allowances against deferred tax assets, the recognition or derecognition of tax benefits related to uncertain tax positions, and changes in or the interpretation of tax laws in jurisdictions where we conduct business. We recognize deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of our assets and liabilities, along with net operating loss and tax credit carryovers. For further discussion and disclosure, see Note 14, “Income Taxes.” | |||||||||||||||||||||||||||||||||
Concentrations of Credit Risk | |||||||||||||||||||||||||||||||||
Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, investments, receivables, and restricted investments. We invest a substantial portion of our cash in the PFM Funds Prime Series — Institutional Class, and the PFM Funds Government Series. These funds represent a portfolio of highly liquid money market securities that are managed by PFM Asset Management LLC (PFM), a Virginia business trust registered as an open-end management investment fund. As of December 31, 2013, and 2012, our investments with PFM amounted to approximately $374 million and $428 million, respectively. Our investments and a portion of our cash equivalents are managed by professional portfolio managers operating under documented investment guidelines. No investment that is in a loss position can be sold by our managers without our prior approval. Our investments consist solely of investment grade debt securities with a maximum maturity of five years and an average duration of two years or less. Restricted investments are invested principally in certificates of deposit and U.S. treasury securities. Concentration of credit risk with respect to accounts receivable is limited due to payors consisting principally of the governments of each state in which our health plan subsidiaries operate. | |||||||||||||||||||||||||||||||||
Risks and Uncertainties | |||||||||||||||||||||||||||||||||
Our profitability depends in large part on our ability to accurately predict and effectively manage medical care costs. We continually review our medical costs in light of our underlying claims experience and revised actuarial data. However, several factors could adversely affect medical care costs. These factors, which include changes in health care practices, inflation, new technologies, major epidemics, natural disasters, and malpractice litigation, are beyond our control and may have an adverse effect on our ability to accurately predict and effectively control medical care costs. Costs in excess of those anticipated could have a material adverse effect on our financial condition, results of operations, or cash flows. | |||||||||||||||||||||||||||||||||
We operate health plans in 11 states, primarily as a direct contractor with the states, and in Los Angeles County, California, as a subcontractor to another health plan holding a direct contract with the state. We are therefore dependent upon a small number of contracts to support our revenue. The loss of any one of those contracts could have a material adverse effect on our financial position, results of operations, or cash flows. Our ability to arrange for the provision of medical services to our members is dependent upon our ability to develop and maintain adequate provider networks. Our inability to develop or maintain such networks might, in certain circumstances, have a material adverse effect on our financial position, results of operations, or cash flows. | |||||||||||||||||||||||||||||||||
Recent Accounting Pronouncements | |||||||||||||||||||||||||||||||||
Health Care Federal Excise Tax. In July 2011, the Financial Accounting Standards Board (FASB) issued guidance related to accounting for the fees to be paid by health insurers to the federal government under the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (ACA). The ACA imposes an annual fee, or excise tax, on health insurers for each calendar year beginning on or after January 1, 2014. The excise tax will be imposed beginning in 2014 based on a company's share of the industry's net premiums written during the preceding calendar year. | |||||||||||||||||||||||||||||||||
The new guidance specifies that the liability for the excise tax should be estimated and recorded in full once the entity provides qualifying health insurance in the applicable calendar year in which the excise tax is payable, with a corresponding deferred cost that is amortized to expense using a straight-line method of allocation unless another method better allocates the excise tax over the calendar year that it is payable. The new guidance is effective for annual reporting periods beginning after December 31, 2013, when the excise tax initially becomes effective. As enacted, this health care federal excise tax is non-deductible for income tax purposes, and is anticipated to be significant. It is yet undetermined how this excise tax will be factored into the calculation of our premium rates, if at all. Accordingly, adoption of this guidance and the enactment of this excise tax as currently written is expected to have a material impact on our financial position, results of operations, and cash flows in future periods. We estimate that our portion of the excise tax in 2014 will be approximately $85 million. | |||||||||||||||||||||||||||||||||
Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants (AICPA), and the Securities and Exchange Commission (SEC), did not have, or are not believed by management to have, a material impact on our present or future consolidated financial statements. |
Net_Income_per_Share_Notes
Net Income per Share (Notes) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Net Income per Share | ' | ||||||||
Net Income per Share | |||||||||
The following table sets forth the calculation of the denominators used to compute basic and diluted net income per share: | |||||||||
December 31, | |||||||||
2013 | 2012 | 2011 | |||||||
(In thousands) | |||||||||
Shares outstanding at the beginning of the period | 46,762 | 45,815 | 45,463 | ||||||
Weighted-average number of shares repurchased | (1,445 | ) | (2 | ) | (160 | ) | |||
Weighted-average number of shares issued | 400 | 567 | 453 | ||||||
Denominator for basic net income per share | 45,717 | 46,380 | 45,756 | ||||||
Dilutive effect of employee stock options and stock grants (1) | 643 | 619 | 669 | ||||||
Dilutive effect of convertible senior notes (2) | 502 | — | — | ||||||
Denominator for diluted net income per share | 46,862 | 46,999 | 46,425 | ||||||
_______________________________ | |||||||||
-1 | Unvested restricted shares are included in the calculation of diluted net income per share when their grant date fair values are below the average fair value of our common shares for each of the periods presented. Options to purchase common shares are included in the calculation of diluted net income per share when their exercise prices are below the average fair value of our common shares for each of the periods presented. For the years ended December 31, 2013, 2012, and 2011 there were approximately 51,000, 87,000 and 137,000 anti-dilutive weighted options, respectively. For the years ended December 31, 2013 and 2011 anti-dilutive restricted shares were insignificant. For the year ended December 31, 2012 there were approximately 304,000 anti-dilutive restricted shares. | ||||||||
-2 | Potentially dilutive shares issuable pursuant to our 1.125% Warrants (defined in Note 12, "Long-Term Debt") were not included in the computation of diluted net income per share for the year ended December 31, 2013, because to do so would have been anti-dilutive. Potentially dilutive shares issuable pursuant to our 3.75% Notes (defined in Note 12, "Long-Term Debt") were not included in the computation of diluted net income per share for the years ended December 31, 2012, and 2011 because to do so would have been anti-dilutive. |
Business_Combinations_Notes
Business Combinations (Notes) | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||
Business Combinations [Abstract] | ' | |||||||||||||||||
Business Combinations | ' | |||||||||||||||||
Business Combinations | ||||||||||||||||||
Health Plans Segment | ||||||||||||||||||
South Carolina. On July 26, 2013, we entered into an agreement with Community Health Solutions of America, Inc. (CHS) to acquire certain assets, including the rights to convert certain of CHS’ Medicaid members covered by South Carolina’s full-risk Medicaid managed care program, consistent with our stated strategy to enter new markets. The conversion of such members was contingent on our successful receipt of an HMO license from the South Carolina Department of Insurance, the award to Molina Healthcare of a full-risk Medicaid managed care contract by the South Carolina Department of Health and Human Services, and the state's conversion to a full-risk Medicaid managed care program. Each of these three conditions was satisfied by January 2014, and on January 1, 2014 approximately 137,000 members were converted to the managed care program and enrolled with our South Carolina health plan. We expect the final purchase price for the acquisition to amount to approximately $63 million, of which $7.5 million was paid in the third quarter of 2013, and $38.1 million was paid in January 2014. | ||||||||||||||||||
Because the number of members we will ultimately convert to the Medicaid managed care program was unknown as of the acquisition date, we recorded an initial contingent consideration liability on the acquisition date amounting to $57.5 million. As of December 31, 2013, we expected the remaining purchase price payable to range from approximately $46 million to $59 million, although the theoretical maximum amount of the payment would be based on the total number of Medicaid members in the state of South Carolina. As of December 31, 2013, we recorded the fair value of the liability amounting to $55.4 million, which represents the remaining purchase price associated with the CHS membership we currently expect to enroll through the purchase price determination date. The final determination date for substantially the entire purchase price will occur in the second quarter of 2014. We will continue to remeasure the contingent consideration liability to fair value at each quarter until the contingency is resolved with adjustments, if any, recorded to operations. The fair value adjustment we recorded from the date of acquisition to December 31, 2013, was a decrease to the liability of $2.1 million, resulting in a gain recorded to operations. | ||||||||||||||||||
In connection with this transaction, we recorded goodwill, which relates to future economic benefits arising from expected synergies achieved in the transaction. Such synergies include use of our existing infrastructure to support our health plan operations in South Carolina. We also recorded intangible assets, for which accumulated amortization was immaterial as of December 31, 2013. We expect to record amortization of $1.9 million per year in the years 2014 through 2018. The goodwill and intangible assets amounts are indicated in the table below. | ||||||||||||||||||
New Mexico. Consistent with our stated strategy to expand within existing markets, on August 1, 2013 our New Mexico health plan closed on its acquisition of the Lovelace Community Health Plan’s contract for the New Mexico Medicaid Salud! Program, under which Lovelace’s Medicaid members became Molina Healthcare Medicaid members. As part of this acquisition, we also added membership covered under New Mexico’s State Coverage Insurance (SCI) program with Lovelace in 2013. Effective January 1, 2014, members in the SCI program were a) enrolled in the Centennial Care program as Medicaid members, or b) eligible to enroll in New Mexico’s health insurance marketplace. We expect the final purchase price for the acquisition to amount to approximately $53 million, of which $51.0 million was paid in 2013. As of December 31, 2013, the New Mexico health plan's membership increased by approximately 80,000 members as a result of this transaction. | ||||||||||||||||||
Because the number of SCI members we will ultimately retain was unknown as of the acquisition date, we recorded an initial contingent consideration liability on the acquisition date amounting to $6.0 million, which was immediately reduced to $2.5 million when we made the acquisition date initial payment. As of December 31, 2013, the fair value of the liability was $2.2 million, which represents the remaining purchase price associated with the SCI program membership we currently expect to enroll, as of the final determination date of the purchase price in the second quarter of 2014. We will continue to remeasure the contingent consideration liability to fair value at each quarter until the contingency is resolved with adjustments, if any, recorded to operations. We believe the contingent consideration liability may decrease further as we learn more about how many SCI members we will retain, but is unlikely to increase. The fair value adjustment we recorded from the date of acquisition to December 31, 2013, was a decrease to the liability of $0.3 million, resulting in a gain recorded to operations. | ||||||||||||||||||
In connection with this transaction, we recorded goodwill, which relates to future economic benefits arising from expected synergies achieved in the transaction. Such synergies include use of our existing infrastructure to support the added membership. We also recorded intangible assets, for which accumulated amortization was immaterial as of December 31, 2013. We expect to record amortization of $1.8 million per year in the years 2014 through 2018. The goodwill and intangible assets amounts are indicated in the table below. | ||||||||||||||||||
Florida. In the second quarter of 2013, our Florida health plan acquired assets relating to the Statewide Medicaid Managed Care Long-Term Care Program from Neighborly Care Network, Inc. The final purchase price for this acquisition was $3.3 million. Accumulated amortization as of December 31, 2013, and future amortization for this acquisition are immaterial. | ||||||||||||||||||
The following table presents assets acquired and the weighted average useful life for the major asset categories for the business combinations in 2013: | ||||||||||||||||||
Fair Value of Assets Acquired - Health Plans Segment | ||||||||||||||||||
Weighted average useful life | South Carolina | New Mexico | Florida | Total | ||||||||||||||
(Years) | (In thousands) | |||||||||||||||||
Membership conversion rights | 12 | $ | 21,800 | $ | — | $ | — | $ | 21,800 | |||||||||
Contract rights | 10.6 | — | 18,300 | — | 18,300 | |||||||||||||
Other finite-lived intangibles | 7.7 | 1,060 | — | 990 | 2,050 | |||||||||||||
Goodwill | Indefinite | 42,140 | 35,178 | 2,332 | 79,650 | |||||||||||||
$ | 65,000 | $ | 53,478 | $ | 3,322 | $ | 121,800 | |||||||||||
Acquisition costs relating to these transactions were immaterial individually and in the aggregate. The amounts recorded as goodwill represent intangible assets that do not qualify for separate recognition as identifiable intangible assets. The entire amounts recorded as goodwill are deductible for income tax purposes. Goodwill is not amortized, but is subject to an annual impairment test. | ||||||||||||||||||
Molina Center. In late 2011, we acquired a 460,000 square foot office building located in Long Beach, California. The building (referred to as the Molina Center), consists of two conjoined fourteen-story office towers on approximately five acres of land. For the last several years we have leased approximately 155,000 square feet of the Molina Center for use as our corporate headquarters and also for use by our California health plan subsidiary. The final purchase price was approximately $81 million, which amount was paid with a combination of cash on hand and bank financing under a term loan agreement. We acquired this business primarily to facilitate space needs for the projected future growth of the Company. In the second quarter of 2013 we entered into a sale-leaseback transaction for the sale and contemporaneous leaseback of the Molina Center. Due to our continuing involvement with the leased property, the sale did not qualify for sale-leaseback accounting treatment and we remain the "accounting owner" of the property. See Note 12, "Long-Term Debt." |
Fair_Value_Measurements_Notes
Fair Value Measurements (Notes) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||||||
Fair Value Measurements | ' | |||||||||||||||||||
Fair Value Measurements | ||||||||||||||||||||
Our consolidated balance sheets include the following financial instruments: cash and cash equivalents, investments, receivables, other current assets, a derivative asset, trade accounts payable, medical claims and benefits payable, long-term debt, a derivative liability, contingent consideration, and other liabilities. We consider the carrying amounts of cash and cash equivalents, receivables, other current assets and current liabilities to approximate their fair values because of the relatively short period of time between the origination of these instruments and their expected realization or payment. For our financial instruments measured at fair value on a recurring basis, we prioritize the inputs used in measuring fair value according to a three-tier fair value hierarchy as follows: | ||||||||||||||||||||
Level 1 — Observable Inputs. Our Level 1 financial instruments recorded at fair value consist of investments including government-sponsored enterprise securities (GSEs) and U.S. treasury notes that are classified as current investments in the accompanying consolidated balance sheets. These financial instruments are actively traded and therefore the fair value for these securities is based on quoted market prices on one or more securities exchanges. | ||||||||||||||||||||
Level 2 — Directly or Indirectly Observable Inputs. Our Level 2 financial instruments recorded at fair value consist of investments including corporate debt securities, municipal securities, and certificates of deposit that are classified as current investments in the accompanying consolidated balance sheets. Such investments are traded frequently though not necessarily daily. Fair value for these investments is determined using a market approach based on quoted prices for similar securities in active markets or quoted prices for identical securities in inactive markets. | ||||||||||||||||||||
Level 3 — Unobservable Inputs. Our Level 3 financial instruments recorded at fair value consist of derivative financial instruments relating to our 1.125% Notes, including the 1.125% Call Option asset, and the embedded cash conversion option liability. These derivatives are not actively traded and are valued based on an option pricing model that uses observable and unobservable market data for inputs. Significant market data inputs used to determine fair value as of December 31, 2013 included our common stock price, time to maturity of the derivative instruments, the risk-free interest rate, and the implied volatility of our common stock. As described further in Note 12, “Long-Term Debt,” and Note 13, “Derivative Financial Instruments,” the 1.125% Call Option asset and the embedded cash conversion option liability were designed such that changes in their fair values would offset, with minimal impact to the consolidated statements of income. Therefore, the sensitivity of changes in the unobservable inputs to the option pricing model for such instruments is mitigated. | ||||||||||||||||||||
Level 3 financial instruments also include contingent consideration liabilities, primarily relating to the acquisition in South Carolina as described in Note 4, "Business Combinations," and recorded to accounts payable and accrued liabilities in our consolidated balance sheets. We applied discounted cash flow analysis to determine the fair value of the contingent consideration liabilities. Significant unobservable inputs primarily related to the probability weighted present values of the purchase price estimates for the projected membership. As of December 31, 2013, we have estimated that such South Carolina acquisition membership could range from approximately 120,000 to 140,000 members, as updated to reflect the successful conversion of membership to our health plan effective January 1, 2014. | ||||||||||||||||||||
Finally, Level 3 financial instruments include non-current auction rate securities that are designated as available-for-sale, and are reported at fair value. To estimate the fair value of these securities we use valuation data from our primary pricing source, a third party who provides a marketplace for illiquid assets with over 10,000 participants. This valuation data is based on a range of prices that represent indicative bids from potential buyers. To validate the reasonableness of the data, we compare these valuations to data from other third-party pricing sources, which also provide a range of prices representing indicative bids from potential buyers. We have concluded that these estimates, given the lack of market available pricing, provide a reasonable basis for determining the fair value of the auction rate securities as of December 31, 2013. | ||||||||||||||||||||
Our financial instruments measured at fair value on a recurring basis at December 31, 2013, were as follows: | ||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Corporate debt securities | $ | 449,772 | $ | — | $ | 449,772 | $ | — | ||||||||||||
GSEs | 68,817 | 68,817 | — | — | ||||||||||||||||
Municipal securities | 113,330 | — | 113,330 | — | ||||||||||||||||
U.S. treasury notes | 37,376 | 37,376 | — | — | ||||||||||||||||
Certificates of deposit | 33,757 | — | 33,757 | — | ||||||||||||||||
Auction rate securities | 10,898 | — | — | 10,898 | ||||||||||||||||
1.125% Call Option derivative asset | 186,351 | — | — | 186,351 | ||||||||||||||||
Total assets measured at fair value on a recurring basis | $ | 900,301 | $ | 106,193 | $ | 596,859 | $ | 197,249 | ||||||||||||
Embedded cash conversion option derivative liability | $ | 186,239 | $ | — | $ | — | $ | 186,239 | ||||||||||||
Contingent consideration liabilities | 57,548 | — | — | 57,548 | ||||||||||||||||
Total liabilities measured at fair value on a recurring basis | $ | 243,787 | $ | — | $ | — | $ | 243,787 | ||||||||||||
Our financial instruments measured at fair value on a recurring basis at December 31, 2012, were as follows: | ||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Corporate debt securities | $ | 191,008 | $ | — | $ | 191,008 | $ | — | ||||||||||||
GSEs | 29,525 | 29,525 | — | — | ||||||||||||||||
Municipal securities | 75,848 | — | 75,848 | — | ||||||||||||||||
U.S. treasury notes | 35,740 | 35,740 | — | — | ||||||||||||||||
Certificates of deposit | 10,724 | — | 10,724 | — | ||||||||||||||||
Auction rate securities | 13,419 | — | — | 13,419 | ||||||||||||||||
Total assets measured at fair value on a recurring basis | $ | 356,264 | $ | 65,265 | $ | 277,580 | $ | 13,419 | ||||||||||||
Interest rate swap derivative liability | $ | 1,307 | $ | — | $ | 1,307 | $ | — | ||||||||||||
The following tables present activity relating to our assets (liabilities) measured at fair value on a recurring basis using significant unobservable inputs (Level 3): | ||||||||||||||||||||
Changes in Level 3 Instruments | ||||||||||||||||||||
Auction Rate Securities | Derivatives, Net | Contingent Consideration Liabilities | ||||||||||||||||||
Balance at December 31, 2011 | $ | 16,134 | $ | — | $ | — | ||||||||||||||
Net unrealized gains included in other comprehensive income | 1,635 | — | — | |||||||||||||||||
Auction rate securities settlements | (4,350 | ) | — | — | ||||||||||||||||
Balance at December 31, 2012 | 13,419 | — | — | |||||||||||||||||
Net unrealized gains included in other comprehensive income | 729 | — | — | |||||||||||||||||
Net unrealized losses included in other expenses | — | (3,810 | ) | — | ||||||||||||||||
Derivative issuance | — | (75,074 | ) | — | ||||||||||||||||
Auction rate securities settlements | (3,250 | ) | — | — | ||||||||||||||||
Derivative re-designation | — | 78,996 | — | |||||||||||||||||
Acquisitions | — | — | (57,548 | ) | ||||||||||||||||
Balance at December 31, 2013 | $ | 10,898 | $ | 112 | $ | (57,548 | ) | |||||||||||||
The amount of total unrealized gains for the period included in other comprehensive income attributable to the change in accumulated other comprehensive losses relating to assets still held at December 31, 2013 | $ | 541 | $ | — | $ | — | ||||||||||||||
The amount of total unrealized gains for the period included in other comprehensive income attributable to the change in accumulated other comprehensive losses relating to assets still held at December 31, 2012 | $ | 1,059 | $ | — | $ | — | ||||||||||||||
Fair Value Measurements - Disclosure Only | ||||||||||||||||||||
The carrying amounts and estimated fair values of our long-term debt, as well as the applicable fair value hierarchy tier, are contained in the tables below. Our convertible senior notes are classified as Level 2 financial instruments. Fair value for these securities is determined using a market approach based on quoted prices for similar securities in active markets or quoted prices for identical securities in inactive markets. The credit facility was repaid and terminated in February 2013, and the term loan was repaid in June 2013. | ||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||
Carrying | Total | |||||||||||||||||||
Amount | Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
1.125% Notes | $ | 416,368 | $ | 572,627 | $ | — | $ | 572,627 | $ | — | ||||||||||
3.75% Notes | 181,872 | 219,491 | — | 219,491 | — | |||||||||||||||
$ | 598,240 | $ | 792,118 | $ | — | $ | 792,118 | $ | — | |||||||||||
31-Dec-12 | ||||||||||||||||||||
Carrying | Total | |||||||||||||||||||
Amount | Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
3.75% Notes | $ | 175,468 | $ | 208,460 | $ | — | $ | 208,460 | $ | — | ||||||||||
Term loan | 47,471 | 47,471 | — | — | 47,471 | |||||||||||||||
Credit facility | 40,000 | 40,000 | — | — | 40,000 | |||||||||||||||
$ | 262,939 | $ | 295,931 | $ | — | $ | 208,460 | $ | 87,471 | |||||||||||
Investments_Notes
Investments (Notes) | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ' | |||||||||||||||||||||
Investments | ' | |||||||||||||||||||||
Investments | ||||||||||||||||||||||
The following tables summarize our investments as of the dates indicated: | ||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||
Amortized | Gross | Estimated | ||||||||||||||||||||
Unrealized | ||||||||||||||||||||||
Cost | Gains | Losses | Fair Value | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||
Corporate debt securities | $ | 450,162 | $ | 442 | $ | 832 | $ | 449,772 | ||||||||||||||
GSEs | 68,898 | 6 | 87 | 68,817 | ||||||||||||||||||
Municipal securities | 114,126 | 119 | 915 | 113,330 | ||||||||||||||||||
U.S. treasury notes | 37,360 | 44 | 28 | 37,376 | ||||||||||||||||||
Certificates of deposit | 33,756 | 2 | 1 | 33,757 | ||||||||||||||||||
Subtotal - current investments | 704,302 | 613 | 1,863 | 703,052 | ||||||||||||||||||
Auction rate securities | 11,400 | — | 502 | 10,898 | ||||||||||||||||||
$ | 715,702 | $ | 613 | $ | 2,365 | $ | 713,950 | |||||||||||||||
December 31, 2012 | ||||||||||||||||||||||
Amortized | Gross | Estimated | ||||||||||||||||||||
Unrealized | ||||||||||||||||||||||
Cost | Gains | Losses | Fair Value | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||
Corporate debt securities | $ | 190,545 | $ | 528 | $ | 65 | $ | 191,008 | ||||||||||||||
GSEs | 29,481 | 45 | 1 | 29,525 | ||||||||||||||||||
Municipal securities | 75,909 | 185 | 246 | 75,848 | ||||||||||||||||||
U.S. treasury notes | 35,700 | 42 | 2 | 35,740 | ||||||||||||||||||
Certificates of deposit | 10,715 | 9 | — | 10,724 | ||||||||||||||||||
Subtotal - current investments | 342,350 | 809 | 314 | 342,845 | ||||||||||||||||||
Auction rate securities | 14,650 | — | 1,231 | 13,419 | ||||||||||||||||||
$ | 357,000 | $ | 809 | $ | 1,545 | $ | 356,264 | |||||||||||||||
The contractual maturities of our investments as of December 31, 2013 are summarized below: | ||||||||||||||||||||||
Amortized | Estimated | |||||||||||||||||||||
Cost | Fair Value | |||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||
Due in one year or less | $ | 350,488 | $ | 350,605 | ||||||||||||||||||
Due one year through five years | 353,814 | 352,447 | ||||||||||||||||||||
Due after ten years | 11,400 | 10,898 | ||||||||||||||||||||
$ | 715,702 | $ | 713,950 | |||||||||||||||||||
Gross realized gains and losses from sales of available-for-sale securities are calculated under the specific identification method and are included in investment income. Net realized investment gains for the year ended December 31, 2013, 2012, and 2011 were $0.3 million, $0.3 million, and $0.4 million, respectively. | ||||||||||||||||||||||
We monitor our investments for other-than-temporary impairment. For investments other than our auction rate securities, discussed below, we have determined that unrealized gains and losses at December 31, 2013, and 2012, are temporary in nature, because the change in market value for these securities has resulted from fluctuating interest rates, rather than a deterioration of the credit worthiness of the issuers. So long as we hold these securities to maturity, we are unlikely to experience gains or losses. In the event that we dispose of these securities before maturity, we expect that realized gains or losses, if any, will be immaterial. | ||||||||||||||||||||||
The following tables segregate those available-for-sale investments that have been in a continuous loss position for less than 12 months, and those that have been in a loss position for 12 months or more as of December 31, 2013. | ||||||||||||||||||||||
In a Continuous Loss Position | In a Continuous Loss Position | |||||||||||||||||||||
for Less than 12 Months | for 12 Months or More | |||||||||||||||||||||
Estimated | Unrealized | Total Number of Securities | Estimated | Unrealized | Total Number of Securities | |||||||||||||||||
Fair | Losses | Fair | Losses | |||||||||||||||||||
Value | Value | |||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||
Corporate debt securities | $ | 210,057 | $ | 802 | 91 | $ | 2,540 | $ | 30 | 3 | ||||||||||||
GSEs | 53,308 | 87 | 21 | — | — | — | ||||||||||||||||
Municipal securities | 30,715 | 398 | 49 | 31,091 | 517 | 39 | ||||||||||||||||
U.S. treasury notes | 12,037 | 28 | 11 | — | — | — | ||||||||||||||||
Certificates of deposit | 414 | 1 | 2 | — | — | — | ||||||||||||||||
Auction rate securities | — | — | — | 10,898 | 502 | 15 | ||||||||||||||||
$ | 306,531 | $ | 1,316 | 174 | $ | 44,529 | $ | 1,049 | 57 | |||||||||||||
The following table segregates those available-for-sale investments that have been in a continuous loss position for less than 12 months, and those that have been in a loss position for 12 months or more as of December 31, 2012. | ||||||||||||||||||||||
In a Continuous Loss Position | In a Continuous Loss Position | |||||||||||||||||||||
for Less than 12 Months | for 12 Months or More | |||||||||||||||||||||
Estimated | Unrealized | Total Number of Securities | Estimated | Unrealized | Total Number of Securities | |||||||||||||||||
Fair | Losses | Fair | Losses | |||||||||||||||||||
Value | Value | |||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||
Corporate debt securities | $ | 44,457 | $ | 65 | 23 | $ | — | $ | — | — | ||||||||||||
GSEs | 5,004 | 1 | 1 | — | — | — | ||||||||||||||||
Municipal securities | 35,223 | 246 | 43 | — | — | — | ||||||||||||||||
U.S. treasury notes | 4,511 | 2 | 5 | — | — | — | ||||||||||||||||
Auction rate securities | — | — | — | 13,419 | 1,231 | 21 | ||||||||||||||||
$ | 89,195 | $ | 314 | 72 | $ | 13,419 | $ | 1,231 | 21 | |||||||||||||
Auction Rate Securities. Due to events in the credit markets, the auction rate securities held by us experienced failed auctions beginning in the first quarter of 2008, and such auctions have not resumed. Therefore, quoted prices in active markets have not been available since early 2008. Our investments in auction rate securities are collateralized by student loan portfolios guaranteed by the U.S. government, and the range of maturities for such securities is from 17 years to 32 years. Considering the relative insignificance of these securities when compared with our liquid assets and other sources of liquidity, we have no current intention of selling these securities nor do we expect to be required to sell these securities before a recovery in their cost basis. For this reason, and because the decline in the fair value of the auction rate securities was not due to the credit quality of the issuers, we do not consider the auction rate securities to be other-than-temporarily impaired at December 31, 2013. At the time of the first failed auctions during first quarter 2008, we held a total of $82.1 million in auction rate securities at par value; since that time, we have settled $70.7 million of these instruments at par value. | ||||||||||||||||||||||
For the year ended December 31, 2013 and 2012, we recorded pretax unrealized gains of $0.7 million and $1.6 million, respectively, to accumulated other comprehensive income for the changes in their fair value. Any future fluctuation in fair value related to these instruments that we deem to be temporary, including any recoveries of previous write-downs, would be recorded to accumulated other comprehensive income. If we determine that any future impairment was other-than-temporary, we would record a charge to earnings as appropriate. |
Receivables_Notes
Receivables (Notes) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Receivables [Abstract] | ' | |||||||
Receivables | ' | |||||||
Receivables | ||||||||
Health Plans segment receivables consist primarily of amounts due from the various states in which we operate. Such receivables are subject to potential retroactive adjustments. Because all of our receivable amounts are readily determinable and our creditors are in almost all instances state governments, our allowance for doubtful accounts is immaterial. Accounts receivable increased as of December 31, 2013, primarily due to certain intermediary arrangements with state agencies entered into in the third quarter of 2013. For further information on these arrangements, refer to Note 11, "Medical Claims and Benefits Payable." | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
Health Plans segment: | ||||||||
California | $ | 148,654 | $ | 28,553 | ||||
Florida | 2,901 | 953 | ||||||
Illinois | 5,773 | — | ||||||
Michigan | 15,253 | 12,873 | ||||||
New Mexico | 17,056 | 9,059 | ||||||
Ohio | 43,969 | 40,980 | ||||||
Texas | 9,736 | 7,459 | ||||||
Utah | 10,953 | 3,359 | ||||||
Washington | 13,455 | 17,587 | ||||||
Wisconsin | 8,087 | 4,098 | ||||||
Direct delivery and other | 2,463 | 2,177 | ||||||
Total Health Plans segment | 278,300 | 127,098 | ||||||
Molina Medicaid Solutions segment | 20,635 | 22,584 | ||||||
$ | 298,935 | $ | 149,682 | |||||
Property_Equipment_and_Capital
Property, Equipment, and Capitalized Software (Notes) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Property, Equipment, and Capitalized Software | ' | |||||||
Property, Equipment, and Capitalized Software | ||||||||
A summary of property, equipment, and capitalized software is as follows: | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
Land | $ | 15,764 | $ | 15,764 | ||||
Building and improvements | 165,670 | 124,163 | ||||||
Furniture and equipment | 131,478 | 97,865 | ||||||
Capitalized software | 187,105 | 154,708 | ||||||
500,017 | 392,500 | |||||||
Less: accumulated depreciation and amortization on building and improvements, furniture and equipment | (103,918 | ) | (84,156 | ) | ||||
Less: accumulated amortization for capitalized software | (104,016 | ) | (86,901 | ) | ||||
(207,934 | ) | (171,057 | ) | |||||
Property, equipment, and capitalized software, net | $ | 292,083 | $ | 221,443 | ||||
Depreciation recognized for building and improvements, and furniture and equipment was $26.6 million, $20.5 million, and $17.5 million for the years ended December 31, 2013, 2012 and 2011, respectively. Amortization of capitalized software was $46.4 million, $36.2 million, and $30.2 million for the years ended December 31, 2013, 2012 and 2011, respectively. | ||||||||
Molina Center. As described in Note 4, "Business Combinations," we acquired the Molina Center in December 2011. Subsequently, in June 2013 we entered into a sale-leaseback transaction for the sale and contemporaneous leaseback of the Molina Center. Due to our continuing involvement with the leased property, the sale did not qualify for sale-leaseback accounting treatment and we remain the "accounting owner" of the property. See Note 12, "Long-Term Debt." | ||||||||
Future minimum rental income on noncancelable leases from third party tenants of the Molina Center is now considered to be sublease rental income, and continues to be reported in rental income in our consolidated statements of income. The future minimum rental income is as follows: | ||||||||
(In thousands) | ||||||||
2014 | $ | 4,192 | ||||||
2015 | 4,110 | |||||||
2016 | 3,542 | |||||||
2017 | 3,742 | |||||||
2018 | 3,581 | |||||||
Thereafter | 2,832 | |||||||
Total minimum future rentals | $ | 21,999 | ||||||
Goodwill_and_Intangible_Assets
Goodwill and Intangible Assets (Notes) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||
Goodwill and Intangible Assets | ' | |||||||||||
Goodwill and Intangible Assets | ||||||||||||
Other intangible assets are amortized over their useful lives ranging from one to 15 years. The weighted average amortization period for contract rights and licenses is approximately 10 years, for customer relationships is approximately five years, for backlog is approximately three years, and for provider networks is approximately 10 years. Based on the balances of our identifiable intangible assets as of December 31, 2013, we estimate that our intangible asset amortization will be $20.4 million in 2014, $14.7 million in 2015, $12.7 million in 2016, $12.4 million in 2017, and $12.1 million in 2018. The following table provides the details of identified intangible assets, by major class, for the periods indicated. For a description of our goodwill and intangible assets by reportable segment, refer to Note 21, “Segment Information.” | ||||||||||||
Cost | Accumulated | Net | ||||||||||
Amortization | Balance | |||||||||||
(In thousands) | ||||||||||||
Intangible assets: | ||||||||||||
Contract rights and licenses | $ | 176,428 | $ | 92,789 | $ | 83,639 | ||||||
Customer relationships | 24,550 | 18,801 | 5,749 | |||||||||
Contract backlog | 23,600 | 19,624 | 3,976 | |||||||||
Provider networks | 13,370 | 7,863 | 5,507 | |||||||||
Balance at December 31, 2013 | $ | 237,948 | $ | 139,077 | $ | 98,871 | ||||||
Intangible assets: | ||||||||||||
Contract rights and licenses | $ | 135,932 | $ | 81,376 | $ | 54,556 | ||||||
Customer relationships | 24,550 | 12,513 | 12,037 | |||||||||
Contract backlog | 23,600 | 17,870 | 5,730 | |||||||||
Provider networks | 11,990 | 6,602 | 5,388 | |||||||||
Balance at December 31, 2012 | $ | 196,072 | $ | 118,361 | $ | 77,711 | ||||||
The following table presents the balances of goodwill as of December 31, 2013 and 2012: | ||||||||||||
31-Dec-12 | Acquisitions | 31-Dec-13 | ||||||||||
(In thousands) | ||||||||||||
Goodwill, gross | $ | 209,618 | $ | 79,650 | $ | 289,268 | ||||||
Accumulated impairment losses | (58,530 | ) | — | (58,530 | ) | |||||||
Goodwill, net | $ | 151,088 | $ | 79,650 | $ | 230,738 | ||||||
The change in the carrying amount in 2013 was due to the acquisitions described in Note 4, "Business Combinations." |
Restricted_Investments_Notes
Restricted Investments (Notes) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Investments, Debt and Equity Securities [Abstract] | ' | |||||||
Restricted Investments | ' | |||||||
Restricted Investments | ||||||||
Pursuant to the regulations governing our Health Plans segment subsidiaries, we maintain statutory deposits and deposits required by state authorities in certificates of deposit and U.S. treasury securities. We also maintain restricted investments as protection against the insolvency of certain capitated providers. Additionally, in connection with the Molina Medicaid Solutions contracts with the states of Maine and Idaho, we maintain restricted investments as collateral for letters of credit. The following table presents the balances of restricted investments: | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
California | $ | 373 | $ | 373 | ||||
Florida | 9,242 | 5,738 | ||||||
Illinois | 310 | 310 | ||||||
Michigan | 1,014 | 1,014 | ||||||
New Mexico | 24,622 | 15,915 | ||||||
Ohio | 9,080 | 9,082 | ||||||
Texas | 3,500 | 3,503 | ||||||
Utah | 3,301 | 3,126 | ||||||
Washington | 151 | 151 | ||||||
Other | 1,196 | 4,889 | ||||||
Total Health Plans segment | 52,789 | 44,101 | ||||||
Molina Medicaid Solutions segment | 10,304 | — | ||||||
$ | 63,093 | $ | 44,101 | |||||
The contractual maturities of our held-to-maturity restricted investments as of December 31, 2013 are summarized below. | ||||||||
Amortized | Estimated | |||||||
Cost | Fair Value | |||||||
(In thousands) | ||||||||
Due in one year or less | $ | 58,542 | $ | 58,543 | ||||
Due one year through five years | 4,551 | 4,555 | ||||||
$ | 63,093 | $ | 63,098 | |||||
Medical_Claims_and_Benefits_Pa
Medical Claims and Benefits Payable (Notes) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Medical Claims and Benefits Payable [Abstract] | ' | |||||||||||
Medical Claims and Benefits Payable | ' | |||||||||||
Medical Claims and Benefits Payable | ||||||||||||
As of December 31, 2013, medical claims and benefits payable include amounts payable to certain providers for which we act as an intermediary on behalf of various state agencies without assuming financial risk. Such receipts and payments do not impact our consolidated statements of income. As of December 31, 2013, we recorded non-risk provider payables relating to such intermediary arrangements of $151.3 million. | ||||||||||||
The following table presents the components of the change in our medical claims and benefits payable from continuing and discontinued operations combined for the periods indicated. The amounts displayed for “Components of medical care costs related to: Prior periods” represent the amount by which our original estimate of claims and benefits payable at the beginning of the period were (more) or less than the actual amount of the liability based on information (principally the payment of claims) developed since that liability was first reported. | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(Dollars in thousands) | ||||||||||||
Balances at beginning of period | $ | 494,530 | $ | 402,476 | $ | 354,356 | ||||||
Components of medical care costs related to: | ||||||||||||
Current period | 5,434,443 | 5,136,055 | 3,911,803 | |||||||||
Prior periods | (52,779 | ) | (39,295 | ) | (51,809 | ) | ||||||
Total medical care costs | 5,381,664 | 5,096,760 | 3,859,994 | |||||||||
Change in non-risk provider payables | 111,267 | (7,004 | ) | 20,630 | ||||||||
Payments for medical care costs related to: | ||||||||||||
Current period | 4,932,195 | 4,689,395 | 3,564,030 | |||||||||
Prior periods | 385,479 | 308,307 | 268,474 | |||||||||
Total paid | 5,317,674 | 4,997,702 | 3,832,504 | |||||||||
Balances at end of period | $ | 669,787 | $ | 494,530 | $ | 402,476 | ||||||
Benefit from prior period as a percentage of: | ||||||||||||
Balance at beginning of period | 10.7 | % | 9.8 | % | 14.6 | % | ||||||
Premium revenue | 0.9 | % | 0.7 | % | 1.2 | % | ||||||
Medical care costs | 1 | % | 0.8 | % | 1.3 | % | ||||||
Assuming that our initial estimate of claims incurred but not paid (IBNP) is accurate, we believe that amounts ultimately paid out would generally be between 8% and 10% less than the liability recorded at the end of the period as a result of the inclusion in that liability of the allowance for adverse claims development and the accrued cost of settling those claims. Because the amount of our initial liability is merely an estimate (and therefore not perfectly accurate), we will always experience variability in that estimate as new information becomes available with the passage of time. Therefore, there can be no assurance that amounts ultimately paid out will fall within the range of 8% to 10% lower than the liability that was initially recorded. Furthermore, because our initial estimate of IBNP is derived from many factors, some of which are qualitative in nature rather than quantitative, we are seldom able to assign specific values to the reasons for a change in estimate - we only know when the circumstances for any one or more factors are out of the ordinary. | ||||||||||||
As indicated above, the amounts ultimately paid out on our liabilities in fiscal years 2013, 2012, and 2011 were less than what we had expected when we had established our reserves. For example, during the years ended December 31, 2013, 2012 and 2011, the amounts ultimately paid out were less than the amount of the reserves we had established as of December 31, 2012, 2011 and 2010, by 10.7%, 9.8% and 14.6%, respectively. While many related factors working in conjunction with one another determine the accuracy of our estimates, we are seldom able to quantify the impact that any single factor has on a change in estimate. In addition, given the variability inherent in the reserving process, we will only be able to identify specific factors if they represent a significant departure from expectations. As a result, we do not expect to be able to fully quantify the impact of individual factors on changes in estimates. | ||||||||||||
We recognized favorable prior period claims development in the amount of $52.8 million for the year ended December 31, 2013. This amount represents our estimate as of December 31, 2013, of the extent to which our initial estimate of medical claims and benefits payable at December 31, 2012 was more than the amount that will ultimately be paid out in satisfaction of that liability. We believe the overestimation of our claims liability at December 31, 2012 was due primarily to the following factors: | ||||||||||||
• | At our Washington health plan certain high-cost newborns, as well as other high-cost disabled members, were covered by the health plan effective July 1, 2012. At the end of 2012, we had limited claims history with which to estimate the claims liability of these members, and overstated the liability for such members. | |||||||||||
• | At our New Mexico health plan, we overestimated the impact of certain high-dollar outstanding claim payments as of December 31, 2012. | |||||||||||
• | At our Ohio health plan, we overestimated the impact of several potential high-dollar claims relating to our aged, blind or disabled (ABD) members. | |||||||||||
We recognized favorable prior period claims development in the amount of $39.3 million for the year ended December 31, 2012. This amount represents our estimate as of December 31, 2012, of the extent to which our initial estimate of medical claims and benefits payable at December 31, 2011 was more than the amount that would ultimately be paid out in satisfaction of that liability. We believe the overestimation of our claims liability at December 31, 2011 was due primarily to the following factors: | ||||||||||||
• | At our Washington health plan, we underestimated the amount of recoveries we would collect for certain high-cost newborn claims, resulting in an overestimation of reserves at year end. | |||||||||||
• | At our Texas health plan, we overestimated the cost of new members in STAR+PLUS (the name of our ABD program in Texas), in the Dallas region. | |||||||||||
• | In early 2011, the state of Michigan was delayed in the enrollment of newborns in managed care plans; the delay was resolved by mid-2011. This caused a large number of claims with older dates of service to be paid during late 2011, resulting in an artificial increase in lag time for claims payment at our Michigan health plan. We adjusted reserves downward for this issue at December 31, 2011, but the adjustment did not capture all of the claims overestimation. | |||||||||||
• | The overestimation of our liability for medical claims and benefits payable was partially offset by an underestimation of that liability at our Missouri health plan, as a result of the costs associated with an unusually large number of premature infants during the fourth quarter of 2011. | |||||||||||
We recognized favorable prior period claims development in the amount of $51.8 million for the year ended December 31, 2011. This amount represents our estimate as of December 31, 2011, of the extent to which our initial estimate of medical claims and benefits payable at December 31, 2010 was more than the amount that would ultimately be paid out in satisfaction of that liability. We believe the overestimation of our claims liability at December 31, 2010 was due primarily to the following factors: | ||||||||||||
• | At our Ohio health plan, we overestimated the impact of a buildup in claims inventory. | |||||||||||
• | At our California health plan, we overestimated the impact of the settlement of disputed provider claims. | |||||||||||
• | At our New Mexico health plan, we underestimated the impact of a reduction in the outpatient facility fee schedule. | |||||||||||
In estimating our claims liability at December 31, 2013, we adjusted our base calculation to take account of the numerous factors that we believe will likely change our final claims liability amount. We believe that the most significant among those factors are: | ||||||||||||
• | At our Texas health plan, we have noted an unusually large number of claims dated older than 12 months. This has caused distortion in the claims lag pattern that we use to estimate incurred claims. | |||||||||||
• | At our Michigan health plan, there were a large number of claim recoveries recorded in June 2013 due to overpayments that resulted from a system configuration issue. These recoveries impacted the completion factors used to estimate incurred claims. While we attempted to remove this distortion from the claims data to develop a more accurate reserve estimate, this type of correction in claims data added a degree of uncertainty for the Michigan reserves as of December 31, 2013. | |||||||||||
• | The state of Florida changed their inpatient Medicaid payment methodology effective July 1, 2013. The majority of our Florida health plan’s provider contracts were also changed accordingly. These changes were intended to be cost neutral, but may have an impact on our specific mix of claims and providers. Also, a new Florida long-term care product became effective on December 1, 2013. This product covers some members who are institutionalized and others who could become institutionalized and would incur very high costs. This added a degree of uncertainty to the reserve estimate as of December 31, 2013. | |||||||||||
• | Our Ohio health plan added approximately 25,000 Temporary Assistance for Needy Families (TANF) program members from new regions effective July 1, 2013. Also effective July 1, 2013, the health plan began covering blind and disabled children under a new product. These two new groups of members added a degree of uncertainty to the reserve estimate as of December 31, 2013. | |||||||||||
The use of a consistent methodology in estimating our liability for claims and medical benefits payable minimizes the degree to which the under- or overestimation of that liability at the close of one period may affect consolidated results of operations in subsequent periods. In particular, the use of a consistent methodology should result in the replenishment of reserves during any given period in a manner that generally offsets the benefit of favorable prior period development in that period. Facts and circumstances unique to the estimation process at any single date, however, may still lead to a material impact on consolidated results of operations in subsequent periods. Any absence of adverse claims development (as well as the expensing through general and administrative expense of the costs to settle claims held as part of the liability at the start of the period) will lead to the recognition of a benefit from prior period claims development in the period subsequent to the date of the original estimate. In 2013, 2012 and 2011, the absence of adverse development of the liability for claims and medical benefits payable at the close of the previous period resulted in the recognition of substantial favorable prior period development. In these years, however, the recognition of a benefit from prior period claims development did not have a material impact on our consolidated results of operations because replenishment of reserves in the respective periods generally offset the benefit from the prior period. |
LongTerm_Debt_Notes
Long-Term Debt (Notes) | 12 Months Ended | |||||||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||||||||||||||||||
Long-Term Debt | ' | |||||||||||||||||||||||||||
Long-Term Debt | ||||||||||||||||||||||||||||
As of December 31, 2013, maturities of long-term debt for the years ending December 31 are as follows (in thousands): | ||||||||||||||||||||||||||||
Total | 2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | ||||||||||||||||||||||
1.125% Notes | $ | 550,000 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 550,000 | ||||||||||||||
3.75% Notes | 187,000 | 187,000 | — | — | — | — | — | |||||||||||||||||||||
$ | 737,000 | $ | 187,000 | $ | — | $ | — | $ | — | $ | — | $ | 550,000 | |||||||||||||||
1.125% Cash Convertible Senior Notes due 2020 | ||||||||||||||||||||||||||||
In February 2013, we issued $550.0 million aggregate principal amount of 1.125% Cash Convertible Senior Notes due 2020 (the 1.125% Notes). This transaction included the initial issuance of $450.0 million on February 11, 2013, plus the exercise of the full amount of the $100.0 million over-allotment option on February 13, 2013. The aggregate net proceeds of the 1.125% Notes were $463.7 million, after payment of the net cost of the Call Spread Overlay described below and in Note 13, “Derivative Financial Instruments,” and deferred issuance costs. Additionally, we used $50.0 million of the net proceeds to purchase shares of our common stock (see Note 15, “Stockholders' Equity”), and $40.0 million to repay the principal owed under our Credit Facility. | ||||||||||||||||||||||||||||
Interest on the 1.125% Notes is payable semiannually in arrears on January 15 and July 15 of each year, at a rate of 1.125% per annum, and commenced on July 15, 2013. The 1.125% Notes will mature on January 15, 2020 unless repurchased or converted in accordance with their terms prior to such date. | ||||||||||||||||||||||||||||
The 1.125% Notes are convertible only into cash, and not into shares of our common stock or any other securities. Holders may convert their 1.125% Notes solely into cash at their option at any time prior to the close of business on the business day immediately preceding July 15, 2019 only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on June 30, 2013 (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period immediately after any five consecutive trading day period in which the trading price per $1,000 principal amount of 1.125% Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. On or after July 15, 2019 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their 1.125% Notes solely into cash at any time, regardless of the foregoing circumstances. Upon conversion, in lieu of receiving shares of our common stock, a holder will receive an amount in cash, per $1,000 principal amount of 1.125% Notes, equal to the settlement amount, determined in the manner set forth in the indenture. | ||||||||||||||||||||||||||||
The initial conversion rate will be 24.5277 shares of our common stock per $1,000 principal amount of 1.125% Notes (equivalent to an initial conversion price of approximately $40.77 per share of common stock). The conversion rate will be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. In addition, following certain corporate events that occur prior to the maturity date, we will pay a cash make-whole premium by increasing the conversion rate for a holder who elects to convert its 1.125% Notes in connection with such a corporate event in certain circumstances. We may not redeem the 1.125% Notes prior to the maturity date, and no sinking fund is provided for the 1.125% Notes. | ||||||||||||||||||||||||||||
If we undergo a fundamental change (as defined in the indenture to the 1.125% Notes), holders may require us to repurchase for cash all or part of their 1.125% Notes at a repurchase price equal to 100% of the principal amount of the 1.125% Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The indenture provides for customary events of default, including cross acceleration to certain other indebtedness of ours, and our significant subsidiaries. | ||||||||||||||||||||||||||||
The 1.125% Notes are senior unsecured obligations, and rank senior in right of payment to any of our indebtedness that is expressly subordinated in right of payment to the 1.125% Notes; equal in right of payment to any of our unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of our secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities (including trade payables) of our subsidiaries. | ||||||||||||||||||||||||||||
The 1.125% Notes contain an embedded cash conversion option. We have determined that the embedded cash conversion option is a derivative financial instrument, required to be separated from the 1.125% Notes and accounted for separately as a derivative liability, with changes in fair value reported in our consolidated statements of income until the embedded cash conversion option transaction settles or expires. The initial fair value of the embedded cash conversion option liability was $149.3 million, which simultaneously reduced the carrying value of the 1.125% Notes (effectively an original issuance discount). For further discussion of the derivative financial instruments relating to the 1.125% Notes, refer to Note 13, “Derivative Financial Instruments.” | ||||||||||||||||||||||||||||
As noted above, the reduced carrying value on the 1.125% Notes resulted in a debt discount that is amortized to the 1.125% Notes' principal amount through the recognition of interest expense over the expected life of the debt. This has resulted in our recognition of interest expense on the 1.125% Notes at an effective rate approximating what we would have incurred had nonconvertible debt with otherwise similar terms been issued. The effective interest rate of the 1.125% Notes is approximately 5.9%, which was imputed based on the amortization of the debt discount over the remaining term of the 1.125% Notes. As of December 31, 2013, we expect the 1.125% Notes to be outstanding until their January 15, 2020 maturity date, for a remaining amortization period of 6.0 years. The 1.125% Notes' if-converted value did not exceed their principal amount as of December 31, 2013. | ||||||||||||||||||||||||||||
In connection with the issuance of the 1.125% Notes, we paid approximately $16.9 million in transaction costs. Such costs have been allocated to the 1.125% Notes, the 1.125% Call Option (defined below) and the 1.125% Warrants (defined below) according to their relative fair values. The amount allocated to the 1.125% Notes, or $12.0 million, was capitalized and will be amortized over the term of the 1.125% Notes. The aggregate amount allocated to the 1.125% Call Option and 1.125% Warrants, or $4.9 million, was recorded to interest expense in the first quarter of 2013. | ||||||||||||||||||||||||||||
1.125% Notes Call Spread Overlay | ||||||||||||||||||||||||||||
Concurrent with the issuance of the 1.125% Notes, we entered into privately negotiated hedge transactions (collectively, the 1.125% Call Option) and warrant transactions (collectively, the 1.125% Warrants), with certain of the initial purchasers of the 1.125% Notes (the Counterparties). These transactions are collectively referred to as the Call Spread Overlay. Under the Call Spread Overlay, the cost of the 1.125% Call Option we purchased to cover the cash outlay upon conversion of the 1.125% Notes was reduced by the sales price of the 1.125% Warrants. Assuming full performance by the Counterparties (and 1.125% Warrants strike prices in excess of the conversion price of the 1.125% Notes), these transactions are intended to offset cash payments due upon any conversion of the 1.125% Notes. We used $149.3 million of the proceeds from the settlement of the 1.125% Notes to pay for the 1.125% Call Option, and simultaneously received $75.1 million for the sale of the 1.125% Warrants, for a net cash outlay of $74.2 million for the Call Spread Overlay. The 1.125% Call Option is a derivative financial instrument. Until April 22, 2013, the 1.125% Warrants were classified as derivative financial instruments; refer to Note 13, “Derivative Financial Instruments” for further discussion. | ||||||||||||||||||||||||||||
Aside from the initial payment of a premium to the Counterparties of $149.3 million, for the 1.125% Call Option, we will not be required to make any cash payments to the Counterparties under the 1.125% Call Option, and will be entitled to receive from the Counterparties an amount of cash, generally equal to the amount by which the market price per share of common stock exceeds the strike price of the 1.125% Call Options during the relevant valuation period. The strike price under the 1.125% Call Option is initially equal to the conversion price of the 1.125% Notes. Additionally, if the market value per share of our common stock exceeds the strike price of the 1.125% Warrants on any trading day during the 160 trading day measurement period under the 1.125% Warrants, we will be obligated to issue to the Counterparties a number of shares equal in value to the product of the amount by which such market value exceeds such strike price and 1/160th of the aggregate number of shares of our common stock underlying the 1.125% Warrants, subject to a share delivery cap. We will not receive any additional proceeds if the 1.125% Warrants are exercised. Pursuant to the 1.125% Warrants, we issued 13,490,236 warrants with a strike price of $53.8475 per share. The number of warrants and the strike price are subject to adjustment under certain circumstances. | ||||||||||||||||||||||||||||
3.75% Convertible Senior Notes due 2014 | ||||||||||||||||||||||||||||
We had $187.0 million of 3.75% Convertible Senior Notes due 2014 (the 3.75% Notes) outstanding as of December 31, 2013. The 3.75% Notes rank equally in right of payment with our existing and future senior indebtedness. The 3.75% Notes are convertible into cash and, under certain circumstances, shares of our common stock. The initial conversion rate is 31.9601 shares of our common stock per one thousand dollar principal amount of the 3.75% Notes. This represents an initial conversion price of approximately $31.29 per share of our common stock. In addition, if certain corporate transactions that constitute a change of control occur prior to maturity, we will increase the conversion rate in certain circumstances. Prior to July 2014, holders may convert their 3.75% Notes only under the following circumstances: | ||||||||||||||||||||||||||||
• | During any fiscal quarter after our fiscal quarter ending December 31, 2007, if the closing sale price per share of our common stock, for each of at least 20 trading days during the period of 30 consecutive trading days ending on the last trading day of the previous fiscal quarter, is greater than or equal to 120% of the conversion price per share of our common stock; | |||||||||||||||||||||||||||
• | During the five business day period immediately following any five consecutive trading day period in which the trading price per one thousand dollar principal amount of the 3.75% Notes for each trading day of such period was less than 98% of the product of the closing price per share of our common stock on such day and the conversion rate in effect on such day; or | |||||||||||||||||||||||||||
• | Upon the occurrence of specified corporate transactions or other specified events. | |||||||||||||||||||||||||||
On or after July 1, 2014, holders may convert their 3.75% Notes at any time prior to the close of business on the scheduled trading day immediately preceding the stated maturity date regardless of whether any of the foregoing conditions is satisfied. | ||||||||||||||||||||||||||||
We will deliver cash and shares of our common stock, if any, upon conversion of each $1,000 principal amount of 3.75% Notes, as follows: | ||||||||||||||||||||||||||||
• | An amount in cash (the "principal return") equal to the sum of, for each of the 20 Volume-Weighted Average Price (VWAP) trading days during the conversion period, the lesser of the daily conversion value for such VWAP trading day and fifty dollars (representing 1/20th of one thousand dollars); and | |||||||||||||||||||||||||||
• | A number of shares based upon, for each of the 20 VWAP trading days during the conversion period, any excess of the daily conversion value above fifty dollars. | |||||||||||||||||||||||||||
The proceeds from the issuance of the 3.75% Notes have been allocated between a liability component and an equity component. The reduced carrying value on the 3.75% Notes resulted in a debt discount that is amortized back to the 3.75% Notes' principal amount through the recognition of non-cash interest expense over the expected life of the debt. This has resulted in our recognition of interest expense on the 3.75% Notes at an effective rate approximating what we would have incurred had nonconvertible debt with otherwise similar terms been issued. The effective interest rate of the 3.75% Notes is 7.5%, principally based on the seven-year U.S. Treasury note rate as of the October 2007 issuance date, plus an appropriate credit spread. As of December 31, 2013, we expect the 3.75% Notes to be outstanding until their October 1, 2014 maturity date, for a remaining amortization period of 9 months; we intend to repay the $187.0 million principal amount due on that date from available cash at the parent company. As of December 31, 2013, the 3.75% Notes’ if-converted value exceeded their principal amount by approximately $11.1 million. The 3.75% Notes' if-converted value did not exceed their principal amount as of December 31, 2012. At December 31, 2013, the equity component of the 3.75% Notes, net of the impact of deferred taxes, was $24.0 million. | ||||||||||||||||||||||||||||
The principal amounts, unamortized discount and net carrying amounts of the convertible senior notes were as follows: | ||||||||||||||||||||||||||||
Principal Balance | Unamortized Discount | Net Carrying Amount | ||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||
December 31, 2013: | ||||||||||||||||||||||||||||
1.125% Notes | $ | 550,000 | $ | 133,632 | $ | 416,368 | ||||||||||||||||||||||
3.75% Notes | 187,000 | 5,128 | 181,872 | |||||||||||||||||||||||||
$ | 737,000 | $ | 138,760 | $ | 598,240 | |||||||||||||||||||||||
December 31, 2012: | ||||||||||||||||||||||||||||
3.75% Notes | $ | 187,000 | $ | 11,532 | $ | 175,468 | ||||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||
Interest cost recognized for the period relating to the: | ||||||||||||||||||||||||||||
Contractual interest coupon rate | $ | 12,427 | $ | 7,012 | $ | 7,012 | ||||||||||||||||||||||
Amortization of the discount | 22,103 | 5,942 | 5,512 | |||||||||||||||||||||||||
Total interest cost recognized | $ | 34,530 | $ | 12,954 | $ | 12,524 | ||||||||||||||||||||||
Lease Financing Obligations | ||||||||||||||||||||||||||||
In June 2013 we entered into a sale-leaseback transaction for the sale and contemporaneous leaseback of two properties, including the Molina Center located in Long Beach, California, and the building that houses our Ohio health plan located in Columbus, Ohio. We sold the two properties for $158.7 million in the aggregate. Due to our continuing involvement with these leased properties, the sale did not qualify for sale-leaseback accounting treatment and we remain the "accounting owner" of the properties. The carrying values of these properties, including the related intangible assets, amounted to $76.8 million in the aggregate as of December 31, 2013. These assets continue to be included in our consolidated balance sheets, and also continue to be depreciated and amortized over their remaining useful lives. The sales price was recorded as a lease financing obligation, which is amortized over the 25-year lease term such that there will be no gain or loss recorded if the lease is not extended at the end of its term. As of December 31, 2013, the aggregate lease financing obligation for these properties amounted to $159.4 million. Rent will increase 3% per year through the initial term. Payments under the lease adjust the lease financing obligation, and the imputed interest is recorded to interest expense in our consolidated statements of income. Associated transaction costs, amounting to $3.5 million, have been deferred and will be amortized over the initial lease term. For information regarding the future minimum rental income, refer to Note 8, "Property, Equipment, and Capitalized Software." For information regarding the future minimum lease obligation, refer to Note 20, “Commitments and Contingencies.” | ||||||||||||||||||||||||||||
As described and defined in further detail in Note 18, "Related Party Transactions," we entered into a lease for office space in February 2013 consisting of two office buildings then under construction, one of which was completed in June 2013. We have concluded that we are the accounting owner of the construction projects because of our continuing involvement in those projects. Therefore, we have recorded $26.6 million to property, equipment and capitalized software, net, in the accompanying consolidated balance sheet as of December 31, 2013, which represents the total cost, including imputed interest, incurred by the Landlord for the completed office building, and thus far for the construction project still in process. As of December 31, 2013, the aggregate amount recorded to lease financing obligations for the construction projects amounted to $27.2 million. Payments under the lease adjust the lease financing obligation, and the imputed interest is recorded to interest expense in our consolidated statements of income. Interest expense for the year ended December 31, 2013 was $1.3 million. In addition to the capitalization of the costs incurred by the Landlord, we impute and record rent expense relating to the ground leases for the property sites. Such rent expense is computed based on the fair value of the land and our incremental borrowing rate, and was immaterial for the year ended December 31, 2013. For information regarding the future minimum lease obligation, refer to Note 20, “Commitments and Contingencies.” | ||||||||||||||||||||||||||||
Term Loan | ||||||||||||||||||||||||||||
In December 2011, we entered into a term loan agreement with various lenders and East West Bank to borrow $48.6 million to finance a portion of the purchase price for the Molina Center, located in Long Beach, California. In June 2013, we repaid the principal balance outstanding under the term loan on that date with proceeds we received in the sale-leaseback transaction described above. | ||||||||||||||||||||||||||||
Credit Facility | ||||||||||||||||||||||||||||
In February 2013, we used $40.0 million of the net proceeds from the offering of the 1.125% Notes to repay all of the outstanding indebtedness under our $170 million revolving Credit Facility, with various lenders and U.S. Bank National Association, as Line of Credit Issuer, Swing Line Lender, and Administrative Agent. As of December 31, 2012, there was $40.0 million outstanding under the Credit Facility. | ||||||||||||||||||||||||||||
We terminated the Credit Facility in connection with the issuance of the 1.125% Notes. Two letters of credit in the aggregate principal amount of $10.3 million that reduced the amount available for borrowing under the Credit Facility as of December 31, 2012, were transferred to direct issue letters of credit with another financial institution. Such direct issue letters of credit are collateralized by restricted investments. |
Derivative_Financial_Instrumen
Derivative Financial Instruments (Notes) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | |||||||||
Derivative Financial Instruments | ' | |||||||||
Derivative Financial Instruments | ||||||||||
The following table summarizes the fair values and the presentation of our derivative financial instruments (defined and discussed individually below) in the consolidated balance sheets: | ||||||||||
December 31, | ||||||||||
Balance Sheet Location | 2013 | 2012 | ||||||||
(In thousands) | ||||||||||
Derivative asset: | ||||||||||
1.125% Call Option | Non-current assets: Derivative asset | $ | 186,351 | $ | — | |||||
Derivative liability: | ||||||||||
Embedded cash conversion option | Non-current liabilities: Derivative liability | $ | 186,239 | $ | — | |||||
Interest rate swap | Non-current liabilities: Derivative liability | — | 1,307 | |||||||
$ | 186,239 | $ | 1,307 | |||||||
Our derivative financial instruments do not qualify for hedge treatment, therefore the change in fair value of these instruments is recognized immediately in our consolidated statements of income, in other expense. The following table summarizes the gains (losses) recorded in the periods presented. There were no gains or losses for the year ended December 31, 2011. | ||||||||||
Year Ended December 31, | ||||||||||
2013 | 2012 | |||||||||
Derivative gains (losses): | ||||||||||
1.125% Call Option | $ | 37,020 | $ | — | ||||||
Embedded cash conversion option | (36,908 | ) | — | |||||||
1.125% Warrants | (3,923 | ) | — | |||||||
Interest rate swap | 433 | (1,307 | ) | |||||||
$ | (3,378 | ) | $ | (1,307 | ) | |||||
1.125% Notes Call Spread Overlay | ||||||||||
As described in Note 12, "Long-Term Debt," we entered into a Call Spread Overlay, whereby the cost of the 1.125% Call Option we purchased to cover the cash outlay upon conversion of the 1.125% Notes was reduced by the sales price of the 1.125% Warrants. Assuming full performance by the Counterparties (and 1.125% Warrants strike prices in excess of the conversion price of the 1.125% Notes), these transactions are intended to offset cash payments due upon any conversion of the 1.125% Notes. | ||||||||||
The 1.125% Call Option, which is indexed to our common stock, is a derivative asset that requires mark-to-market accounting treatment due to the cash settlement features until the 1.125% Call Option settles or expires. The 1.125% Call Option is measured and reported at fair value on a recurring basis, within Level 3 of the fair value hierarchy. For further discussion of the inputs used to determine the fair value of the 1.125% Call Option, refer to Note 5, “Fair Value Measurements.” | ||||||||||
Until April 22, 2013, the 1.125% Warrants were recorded as a derivative liability that required mark-to-market accounting treatment due to certain terms in the 1.125% Warrants that prevented such instruments being considered to be indexed in our common stock. Effective April 22, 2013, we entered into amended and restated warrant confirmations with the Counterparties to clarify these terms, such that 1.125% Warrants are no longer considered to be derivative instruments, and were re-designated as additional paid-in capital. In 2013, we recorded a loss for the change in fair value of the 1.125% Warrants from February 15, 2013 to April 22, 2013. | ||||||||||
Embedded Cash Conversion Option | ||||||||||
The embedded cash conversion option within the 1.125% Notes is required to be separated from the 1.125% Notes and accounted for separately as a derivative liability, with changes in fair value reported in our consolidated statements of income until the cash conversion option settles or expires. For further discussion of the inputs used to determine the fair value of the embedded cash conversion option, refer to Note 5, “Fair Value Measurements.” | ||||||||||
Interest Rate Swap | ||||||||||
In May 2012, we entered into a $42.5 million notional amount interest rate swap agreement, (Swap Agreement), with an effective date of March 1, 2013. The Swap Agreement was intended to reduce our exposure to fluctuations in the contractual variable interest rates under our term loan agreement that was repaid in June 2013. The Swap Agreement was measured and reported at fair value on a recurring basis, within Level 2 of the fair value hierarchy. In June 2013, we settled the interest rate swap for $0.9 million. |
Income_Taxes_Notes
Income Taxes (Notes) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||
Income Taxes | ' | |||||||||||
Income Taxes | ||||||||||||
The provision for income taxes for continuing operations consisted of the following: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Current: | ||||||||||||
Federal | $ | 66,883 | $ | 23,019 | $ | 24,435 | ||||||
State | 581 | 1,254 | 1,587 | |||||||||
Total current | 67,464 | 24,273 | 26,022 | |||||||||
Deferred: | ||||||||||||
Federal | (25,498 | ) | (9,205 | ) | 16,905 | |||||||
State | (5,650 | ) | (4,555 | ) | (13 | ) | ||||||
Total deferred | (31,148 | ) | (13,760 | ) | 16,892 | |||||||
Total provision for income taxes | $ | 36,316 | $ | 10,513 | $ | 42,914 | ||||||
A reconciliation of the U.S. federal statutory income tax rate to the combined effective income tax rate for continuing operations is as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Statutory federal tax rate | 35 | % | 35 | % | 35 | % | ||||||
State income taxes, net of federal benefit | (0.5 | ) | (9.2 | ) | 0.9 | |||||||
Change in unrecognized tax benefits | (3.7 | ) | 0.7 | (0.3 | ) | |||||||
Nondeductible compensation | 9.6 | 6.2 | — | |||||||||
Nondeductible lobbying | 1.6 | 4.2 | 0.6 | |||||||||
Purchase accounting adjustment | — | — | (0.8 | ) | ||||||||
Nondeductible fair value of 1.125% Warrants | 2.4 | — | — | |||||||||
Change in fair value of contingent consideration liabilities | (0.3 | ) | 4.8 | — | ||||||||
Other | 0.7 | 3.3 | 0.3 | |||||||||
Effective tax rate | 44.8 | % | 45 | % | 35.7 | % | ||||||
Our effective tax rate is based on expected income, statutory tax rates, and tax planning opportunities available to us in the various jurisdictions in which we operate. Significant management estimates and judgments are required in determining our effective tax rate. We are routinely under audit by federal, state, or local authorities regarding the timing and amount of deductions, nexus of income among various tax jurisdictions, and compliance with federal, state, and local tax laws. | ||||||||||||
During 2013, 2012, and 2011 excess tax benefits from shared-based compensation were $1.6 million, $3.1 million, and $0.9 million respectively. These amounts were recorded as a decrease to income taxes payable and an increase to additional paid-in capital. | ||||||||||||
Deferred tax assets and liabilities are classified as current or non-current according to the classification of the related asset or liability. Significant components of our deferred tax assets and liabilities as of December 31, 2013 and 2012 were as follows: | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
(In thousands) | ||||||||||||
Accrued expenses | $ | 19,545 | $ | 15,381 | ||||||||
Reserve liabilities | 1,712 | 2,936 | ||||||||||
State taxes | (1,323 | ) | (606 | ) | ||||||||
Other accrued medical costs | 2,540 | 2,518 | ||||||||||
Net operating losses | 27 | 27 | ||||||||||
Unrealized losses (gains) | 380 | (283 | ) | |||||||||
Unearned premiums | 10,543 | 15,675 | ||||||||||
Prepaid expenses | (5,354 | ) | (4,390 | ) | ||||||||
Basis in debt | (2,162 | ) | — | |||||||||
Deferred compensation | 2,087 | 1,611 | ||||||||||
Other, net | (928 | ) | 176 | |||||||||
Valuation allowance | (511 | ) | (602 | ) | ||||||||
Deferred tax asset, net of valuation allowance — current | 26,556 | 32,443 | ||||||||||
Reserve liabilities | 1,909 | 2,013 | ||||||||||
State tax credit carryover | 7,027 | 4,149 | ||||||||||
Net operating losses | 2,326 | 3,341 | ||||||||||
Unrealized losses | 286 | 563 | ||||||||||
Depreciation and amortization | (40,433 | ) | (44,198 | ) | ||||||||
Deferred compensation | 3,404 | 3,323 | ||||||||||
Lease financing obligation | 27,543 | — | ||||||||||
Debt basis | 466 | (5,410 | ) | |||||||||
Other, net | (24 | ) | 702 | |||||||||
Valuation allowance | (3,084 | ) | (2,383 | ) | ||||||||
Deferred tax liability, net of valuation allowance — long term | (580 | ) | (37,900 | ) | ||||||||
Net deferred income tax asset (liability) | $ | 25,976 | $ | (5,457 | ) | |||||||
At December 31, 2013, we had federal and state net operating loss carryforwards of $0.2 million and $57.2 million, respectively. The federal net operating loss begins expiring in 2018, and state net operating losses begin expiring in 2015. The utilization of the net operating losses is subject to certain limitations under federal law. | ||||||||||||
At December 31, 2013, we had California enterprise zone tax credit carryovers of $10.8 million which expire in 2024. | ||||||||||||
We evaluate the need for a valuation allowance taking into consideration the ability to carry back and carry forward tax credits and losses, available tax planning strategies and future income, including reversal of temporary differences. We have determined that as of December 31, 2013, $3.6 million of deferred tax assets did not satisfy the recognition criteria due to uncertainty regarding the realization of some of our state tax operating loss carryforwards. We increased our valuation allowance $0.6 million from $3.0 million at December 31, 2012 to $3.6 million as of December 31, 2013. | ||||||||||||
We recognize tax benefits only if the tax position is more likely than not to be sustained. We are subject to income taxes in the U.S. and numerous state jurisdictions. Significant judgment is required in evaluating our tax positions and determining our provision for income taxes. During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. We establish reserves for tax-related uncertainties based on estimates of whether, and the extent to which, additional taxes will be due. These reserves are established when we believe that certain positions might be challenged despite our belief that our tax return positions are fully supportable. We adjust these reserves in light of changing facts and circumstances, such as the outcome of tax audits. The provision for income taxes includes the impact of reserve provisions and changes to reserves that are considered appropriate. | ||||||||||||
The roll-forward of our unrecognized tax benefits is as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Gross unrecognized tax benefits at beginning of period | $ | (10,622 | ) | $ | (10,712 | ) | $ | (10,962 | ) | |||
Increases in tax positions for prior years | — | (441 | ) | (137 | ) | |||||||
Decreases in tax positions for prior years | 3,615 | 320 | — | |||||||||
Increases in tax positions for current year | (2,084 | ) | — | — | ||||||||
Decreases in tax positions for current year | 886 | — | — | |||||||||
Lapse in statute of limitations | 175 | 211 | 387 | |||||||||
Gross unrecognized tax benefits at end of period | $ | (8,030 | ) | $ | (10,622 | ) | $ | (10,712 | ) | |||
The total amount of unrecognized tax benefits at December 31, 2013, 2012 and 2011 that, if recognized, would affect the effective tax rates is $5.7 million, $7.4 million and $7.4 million, respectively. Approximately $5.9 million of the unrecognized tax benefits recorded at December 31, 2013 relates to a tax position claimed on a state refund claim that will not result in a cash payment for income taxes if our claim is denied. We expect that during the next 12 months it is reasonably possible that unrecognized tax benefit liabilities may decrease by as much as $6.2 million due the resolution to the state refund claim as well as the normal expiration of statutes of limitation. | ||||||||||||
Our continuing practice is to recognize interest and/or penalties related to unrecognized tax benefits in income tax expense. As of December 31, 2013, December 31, 2012, and December 31, 2011, we had accrued $79,000, $56,000, and $65,000, respectively, for the payment of interest and penalties. | ||||||||||||
We are under examination, or may be subject to examination, by the Internal Revenue Service (IRS) for calendar years 2010 through 2013. We are under examination, or may be subject to examination, in certain state and local jurisdictions, with the major jurisdictions being California, Utah, and Michigan, for the years 2004 through 2013. |
Stockholders_Equity_Notes
Stockholders' Equity (Notes) | 12 Months Ended |
Dec. 31, 2013 | |
Equity [Abstract] | ' |
Stockholders' Equity | ' |
Stockholders’ Equity | |
Stockholders' equity increased $110.6 million during the year ended December 31, 2013. The increase was primarily due to the $79.0 million re-designation of the 1.125% Warrants as additional paid-in capital, net income of $52.9 million, and $32.0 million related to employee stock transactions, partially offset by $52.7 million in repurchases of our common stock, as described in further detail below. | |
Common Shares Authorized. On May 1, 2013, our stockholders approved an amendment to our certificate of incorporation to increase the number of authorized shares of our common stock from 80,000,000 to 150,000,000. | |
1.125% Warrants. Pursuant to the 1.125% Warrants, we issued 13,490,236 warrants with a strike price of $53.8475 per share. The number of warrants and the strike price are subject to adjustment under certain circumstances. If the market value per share of our common stock exceeds the strike price of the 1.125% Warrants on any trading day during the 160 trading day measurement period under the 1.125% Warrants, we will be obligated to issue to the Counterparties a number of shares equal in value to the product of the amount by which such market value exceeds such strike price and 1/160th of the aggregate number of shares of our common stock underlying the 1.125% Warrants, subject to a share delivery cap. The 1.125% Warrants will generally begin to expire in the 160 trading day measurement following April 15, 2020. | |
We will not receive any additional proceeds if the 1.125% Warrants are exercised. The 1.125% Warrants could separately have a dilutive effect to the extent that the market value per share of our common stock (as measured under the terms of the warrant transactions) exceeds the applicable strike price of the 1.125% Warrants. As described in Note 13, "Derivative Financial Instruments," we re-designated the 1.125% Warrants as additional paid-in capital during the second quarter of 2013, resulting in an increase to stockholders' equity. | |
Securities Repurchases and Repurchase Program. In connection with the issuance and settlement of the 1.125% Notes, we used a portion of the net proceeds from the offering to repurchase $50 million of our common stock in negotiated transactions with institutional investors in the offering, concurrently with the pricing of the offering. In February 2013, we repurchased a total of 1,624,959 shares at $30.77 per share, which was our closing stock price on that date. | |
Effective as of September 30, 2013, our board of directors authorized the repurchase of up to $50 million in aggregate of our common stock. Stock repurchases under this program may be made through open-market and/or privately negotiated transactions at times and in such amounts as management deems appropriate. The timing and actual number of shares repurchased depends on a variety of factors including price, corporate and regulatory requirements and other market conditions. Under this program, we purchased 85,086 shares of our common stock for $2.7 million (average cost of $31.28 per share) during November 2013. This newly authorized repurchase program extends through December 31, 2014, and replaces in its entirety, the $75 million repurchase program adopted by the board of directors in February 2013. | |
In December 2012, we purchased 110,988 shares of our common stock from certain Molina family trusts for an aggregate purchase price of $3.0 million. This purchase transaction was approved by our board of directors. The shares were purchased at a price of $27.03, representing the closing price per share of our common stock on December 26, 2012. See Note 18, "Related Party Transactions." | |
In October 2011, our board of directors authorized the repurchase of $75 million in aggregate of either our common stock or our 3.75% Notes (see Note 12, “Long-Term Debt”). The repurchase program expired in October 2012. No securities were purchased under this program in 2012. | |
Shelf Registration Statement. In May 2012, we filed an automatic shelf registration statement on Form S-3 with the SEC covering the issuance of an indeterminate number of our securities, including common stock, warrants, or debt securities. We may publicly offer securities from time to time at prices and terms to be determined at the time of the offering. | |
Stock Plans. In connection with the stock plans described in Note 17, “Share-Based Compensation,” we issued approximately 820,000, and 1,057,000 shares of common stock, net of shares used to settle employees’ income tax obligations, for the years ended December 31, 2013 and 2012, respectively. For the years ended December 31, 2013 and 2012, stock plan activity resulted in increases to additional paid-in capital of $32.0 million and $19.5 million, respectively. |
Employee_Benefits_Notes
Employee Benefits (Notes) | 12 Months Ended |
Dec. 31, 2013 | |
Postemployment Benefits [Abstract] | ' |
Employee Benefits | ' |
Employee Benefits | |
We sponsor a defined contribution 401(k) plan that covers substantially all full-time salaried and hourly employees of our company and its subsidiaries. Eligible employees are permitted to contribute up to the maximum amount allowed by law. We match up to the first 4% of compensation contributed by employees. Expense recognized in connection with our contributions to the 401(k) plan totaled $12.8 million, $10.7 million and $8.5 million in the years ended December 31, 2013, 2012, and 2011, respectively. | |
We also have a nonqualified deferred compensation plan for certain key employees. Under this plan, eligible participants may defer up to 100% of their base salary and 100% of their bonus to provide tax-deferred growth for retirement. The funds deferred are invested in corporate-owned life insurance, under a rabbi trust. |
ShareBased_Compensation_Notes
Share-Based Compensation (Notes) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||||||||||||
Share-Based Compensation | ' | |||||||||||||||||||||||
Share-Based Compensation | ||||||||||||||||||||||||
At December 31, 2013, we had employee equity incentives outstanding under two plans: (1) the 2011 Equity Incentive Plan (2011 Plan); and (2) the 2002 Equity Incentive Plan (from which equity incentives are no longer awarded). | ||||||||||||||||||||||||
The 2011 Plan provides for the award of stock options, restricted shares and units, performance shares and units, and stock bonuses to the company’s officers, employees, directors, consultants, advisors, and other service providers. The 2011 Plan allows for the issuance of 4.5 million shares of common stock. | ||||||||||||||||||||||||
In March 2013, our named executive officers were granted restricted stock awards with performance conditions as follows: our chief executive officer was awarded 186,858 shares, our chief financial officer was awarded 93,429 shares, our chief operating officer was awarded 62,286 shares, our chief accounting officer was awarded 28,029 shares, and our general counsel was awarded 21,800 shares. These awards were apportioned into four equal increments, and will vest in accordance with the following four measures: (i) 1/4th will vest in equal 1/3rd increments over three years on March 1, 2014, March 1, 2015, and March 1, 2016; (ii) 1/4th will vest upon our achievement of three-year Total Stockholder Return (TSR) as determined by Institutional Shareholder Services Inc. (ISS) calculations for the three-year period ending December 31, 2013 equal to or greater than the 50th percentile within our ISS peer group; (iii) 1/4th shall vest upon our achievement of total revenue in any of the 2013, 2014, or 2015 fiscal years equal to or greater than $12 billion, and (iv) 1/4th shall vest upon our achievement of the three-year earnings before interest, taxes, depreciation and amortization (EBITDA) margin percentage for the three-year period ending December 31, 2013 equal to or greater than 2.5%. In the event the vesting conditions are not achieved, the awards shall lapse. As of December 31, 2013 the TSR- and EBITDA-related performance measures were achieved. | ||||||||||||||||||||||||
Restricted share awards are granted with a fair value equal to the market price of our common stock on the date of grant, and generally vest in equal annual installments over periods up to four years from the date of grant. Stock option awards have an exercise price equal to the fair market value of our common stock on the date of grant, generally vest in equal annual installments over periods up to four years from the date of grant, and have a maximum term of ten years from the date of grant. | ||||||||||||||||||||||||
Under our employee stock purchase plan (ESPP), eligible employees may purchase common shares at 85% of the lower of the fair market value of our common stock on either the first or last trading day of each six-month offering period. Each participant is limited to a maximum purchase of $25,000 (as measured by the fair value of the stock acquired) per year through payroll deductions. We estimate the fair value of the stock issued using the Black-Scholes option pricing model. For the years ended December 31, 2013, 2012, 2011, the inputs to this model were as follows: risk-free interest rates ranging from approximately 0.1% to 0.2%; expected volatilities ranging from approximately 30% to 50%, dividend yields of 0%, and an average expected life of 0.8 years. We issued approximately 299,600, 277,400 and 201,700 shares of our common stock under the ESPP during the years ended December 31, 2013, 2012, and 2011, respectively. In 2011, stockholders approved our 2011 ESPP, which superseded the 2002 Employee Stock Purchase Plan. The 2011 ESPP allows for the issuance of three million shares of common stock. | ||||||||||||||||||||||||
The following table illustrates the components of our share-based compensation expense that are reported in general and administrative expenses in the consolidated statements of income: | ||||||||||||||||||||||||
Year Ended December 31, | ||||||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Pretax | Net-of-Tax | Pretax | Net-of-Tax | Pretax | Net-of-Tax | |||||||||||||||||||
Charges | Amount | Charges | Amount | Charges | Amount | |||||||||||||||||||
Restricted stock and performance awards | $ | 26,116 | $ | 22,489 | $ | 18,106 | $ | 12,943 | $ | 15,914 | $ | 9,946 | ||||||||||||
Employee stock purchase plan and stock options | 2,578 | 2,012 | 1,912 | 1,613 | 1,138 | 712 | ||||||||||||||||||
$ | 28,694 | $ | 24,501 | $ | 20,018 | $ | 14,556 | $ | 17,052 | $ | 10,658 | |||||||||||||
As of December 31, 2013, there was $20.1 million of total unrecognized compensation expense related to unvested restricted share awards, including those with performance conditions, which we expect to recognize over a remaining weighted-average period of 1.8 years. This unrecognized compensation cost assumes an estimated forfeiture rate of 6.1% as of December 31, 2013. Also as of December 31, 2013, there was $0.6 million of unrecognized compensation expense related to unvested stock options, which we expect to recognize over a weighted-average period of 2.0 years. | ||||||||||||||||||||||||
Restricted and performance stock activity for the year ended December 31, 2013 is summarized below: | ||||||||||||||||||||||||
Shares | Weighted | |||||||||||||||||||||||
Average | ||||||||||||||||||||||||
Grant Date | ||||||||||||||||||||||||
Fair Value | ||||||||||||||||||||||||
Unvested balance as of December 31, 2012 | 986,577 | $ | 23.74 | |||||||||||||||||||||
Granted - restricted stock | 587,706 | 32.15 | ||||||||||||||||||||||
Granted - performance stock | 456,174 | 30.8 | ||||||||||||||||||||||
Vested - restricted stock | (669,075 | ) | 25.45 | |||||||||||||||||||||
Forfeited | (61,530 | ) | 26.2 | |||||||||||||||||||||
Unvested balance as of December 31, 2013 | 1,299,852 | 29.03 | ||||||||||||||||||||||
The total fair value of restricted and performance awards granted during the year ended December 31, 2013, 2012, and 2011 was $33.3 million, $16.2 million, and $18.4 million, respectively. The total fair value of restricted awards, including those with performance conditions, vested during the year ended December 31, 2013, 2012, and 2011 was $22.3 million, $25.4 million, and $12.2 million, respectively. | ||||||||||||||||||||||||
The weighted-average grant date fair value per share of the performance awards with vesting conditions based on TSR, as described above, was $28.24. We estimated the fair value on the grant date using a Monte Carlo Simulation to project TSR over the performance period using correlations and volatilities of the ISS peer group. Additional inputs included a risk-free interest rate of 0.14%, dividend yield of 0%, and an expected life of 0.83 years. | ||||||||||||||||||||||||
The total fair value of restricted stock units granted during the year ended December 31, 2012 was $0.3 million with a weighted average grant date fair value of $35.01. These restricted stock units vested during 2013. No restricted stock units were granted in 2013 and 2011 and there were no outstanding restricted stock units as of December 31, 2013. | ||||||||||||||||||||||||
Stock option activity for the year ended December 31, 2013 is summarized below: | ||||||||||||||||||||||||
Shares | Weighted | Aggregate | Weighted | |||||||||||||||||||||
Average | Intrinsic | Average | ||||||||||||||||||||||
Exercise Price | Value | Remaining | ||||||||||||||||||||||
Contractual | ||||||||||||||||||||||||
term | ||||||||||||||||||||||||
(In thousands) | (Years) | |||||||||||||||||||||||
Stock options outstanding as of December 31, 2012 | 414,061 | $ | 22.39 | |||||||||||||||||||||
Granted | 45,000 | 33.02 | ||||||||||||||||||||||
Exercised | (79,540 | ) | 20.09 | |||||||||||||||||||||
Forfeited | (300 | ) | 17.63 | |||||||||||||||||||||
Stock options outstanding as of December 31, 2013 | 379,221 | 24.14 | $ | 4,024 | 3.4 | |||||||||||||||||||
Stock options exercisable and expected to vest as of December 31, 2013 | 379,221 | 24.14 | $ | 4,024 | 3.4 | |||||||||||||||||||
Exercisable as of December 31, 2013 | 324,221 | 22.58 | $ | 3,947 | 2.5 | |||||||||||||||||||
The weighted-average grant date fair value per share of stock options awarded to the new members of our board of directors during 2013 was $14.67. The weighted-average grant date fair value per share of the stock option awarded to the director appointed during 2012 was $13.97. We estimate the fair value of each stock option award on the grant date using the Black-Scholes option pricing model. To determine the fair value of these stock options we applied risk-free interest rates of 1.1% to 1.4%, expected volatilities of 41.3% to 43.0%, dividend yields of 0%, and expected lives of 6 years to 7 years. No stock options were granted in 2011. The following is a summary of information about stock options outstanding and exercisable at December 31, 2013: | ||||||||||||||||||||||||
Options Outstanding | Options Exercisable | |||||||||||||||||||||||
Range of Exercise Prices | Number | Weighted- | Weighted- | Number | Weighted- | |||||||||||||||||||
Outstanding | Average | Average | Exercisable | Average | ||||||||||||||||||||
Remaining | Exercise | Exercise | ||||||||||||||||||||||
Contractual | Price | Price | ||||||||||||||||||||||
Life (Years) | ||||||||||||||||||||||||
$16.89 – $19.11 | 78,671 | 2 | $ | 19.05 | 78,671 | $ | 19.05 | |||||||||||||||||
$20.88 | 147,000 | 3.2 | 20.88 | 147,000 | 20.88 | |||||||||||||||||||
$22.86 – $34.82 | 153,550 | 4.4 | 29.87 | 98,550 | 27.93 | |||||||||||||||||||
379,221 | 324,221 | |||||||||||||||||||||||
Related_Party_Transactions_Not
Related Party Transactions (Notes) | 12 Months Ended |
Dec. 31, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
Related Party Transactions | |
Leased Office Buildings | |
In February 2013, the Parent (as defined in Note 23, "Condensed Financial Information of Registrant,") entered into a lease (the “Lease”) with 6th & Pine Development, LLC (the “Landlord”) for office space located in Long Beach, California. The Lease consists of two office buildings, one of which is under construction. The first building which comprises approximately 90,000 square feet of office and storage space (Building A) was completed in June 2013; immediately following its completion, we occupied Building A and commenced lease payments. The second building (Building B) is expected to comprise approximately 120,000 square feet of office space. | |
The term of the Lease with respect to Building A commenced in June 2013, and the term of the Lease with respect to Building B is expected to commence in November 2014. The initial term of the Lease with respect to both buildings expires on December 31, 2024, subject to two options to extend the term for a period of five years each. Initial annual rent for Building A is approximately $2.6 million and initial annual rent for Building B is expected to be approximately $4.0 million. Rent will increase 3.75% per year through the initial term. Rent during the extension terms will be the greater of then-current rent or fair market rent. For information regarding the lease financing obligation, refer to Note 12, “Long-Term Debt.” | |
The principal members of the Landlord are John C. Molina, our Chief Financial Officer and a director of the Company, and his wife. In addition, in connection with the development of the buildings being leased, the Landlord has pledged shares of common stock in the Parent he holds as trustee. Dr. J. Mario Molina, our Chief Executive Officer and Chairman of the Board of Directors, holds a partial interest in such shares as trust beneficiary. | |
Stock Repurchase | |
In December 2012, the Parent purchased 110,988 shares of our common stock from certain Molina family trusts for an aggregate purchase price of $3.0 million. This purchase transaction was approved by our board of directors. The shares were purchased at a price of $27.03, representing the closing price per share of our common stock on December 26, 2012. The shares were purchased from the Janet M. Watt Separate Property Trust dated 10/22/2007, (Separate Property Trust), and the Watt Family Trust dated 10/11/1996 (Family Trust). Janet M. Watt is the sister, and her husband Lawrence B. Watt is the brother-in-law, of Dr. J. Mario Molina and John Molina. Ms. Watt is the sole trustee of the Separate Property Trust, and a co-trustee with Lawrence B. Watt of the Family Trust. |
Variable_Interest_Entities_Not
Variable Interest Entities (Notes) | 12 Months Ended | |
Dec. 31, 2013 | ||
Variable Interest Entities [Abstract] | ' | |
Variable Interest Entities | ' | |
Variable Interest Entities | ||
Joseph M. Molina M.D., Professional Corporations | ||
The Joseph M. Molina, M.D. Professional Corporations (JMMPC) were created in 2012 to further advance our direct delivery business. JMMPC's sole shareholder is Dr. J. Mario Molina, our Chairman of the Board, President and Chief Executive Officer. Dr. Molina is paid no salary and receives no dividends in connection with his work for, or ownership of, JMMPC. JMMPC provides professional medical services to the general public for routine non-life threatening, outpatient health care needs. Substantially all of the individuals served by JMMPC are members of our health plans. JMMPC does not have agreements to provide professional medical services with any other entities. | ||
Our wholly owned subsidiary, American Family Care, Inc. (AFC), has entered into services agreements with JMMPC to provide clinic facilities, clinic administrative support staff, patient scheduling services and medical supplies to JMMPC. The services agreements were designed such that JMMPC will not operate at a loss, ensuring the availability of quality care and access for our health plan members. The services agreements provide that the administrative fees charged to JMMPC by AFC are reviewed annually to assure the achievement of this goal. | ||
Our California, Florida, New Mexico and Washington health plans have entered into primary care capitation agreements with JMMPC. These agreements also direct our health plans to fund JMMPC's operating deficits, or receive JMMPC's operating surpluses, based on a monthly reconciliation. Because the AFC services agreements described above mitigate the likelihood of significant operating deficits or surpluses, such monthly reconciliation amounts are insignificant. | ||
We have determined that JMMPC is a variable interest entity (VIE), and that we are its primary beneficiary. We have reached this conclusion under the power and benefits criterion model according to GAAP. Specifically, we have the power to direct the activities that most significantly affect JMMPC's economic performance, and the obligation to absorb losses or right to receive benefits that are potentially significant to the VIE, under the agreements described above. Because we are its primary beneficiary, we have consolidated JMMPC. JMMPC's assets may be used to settle only JMMPC's obligations, and JMMPC's creditors have no recourse to the general credit of Molina Healthcare, Inc. As of December 31, 2013, JMMPC had total assets of $6.9 million, and total liabilities of $6.6 million. As of December 31, 2012, JMMPC had total assets of $1.4 million, and total liabilities of $1.1 million. | ||
Our maximum exposure to loss as a result of our involvement with JMMPC is generally limited to the amounts needed to fund JMMPC's ongoing payroll and employee benefits. We believe that such loss exposure will be immaterial to our consolidated operating results and cash flows for the foreseeable future. We provided an initial cash infusion of $0.3 million to JMMPC in the first quarter of 2012 to fund its start-up operations. During 2013 our health plans did not receive any amounts from JMMPC under the terms of the affiliation agreement. During 2012 our health plans received $0.2 million from JMMPC under the terms of the affiliation agreement. | ||
New Markets Tax Credit | ||
During the fourth quarter of 2011, our New Mexico data center subsidiary entered into a financing transaction with Wells Fargo Community Investment Holdings, LLC (Wells Fargo), its wholly owned subsidiary New Mexico Healthcare Data Center Investment Fund, LLC (Investment Fund), and certain of Wells Fargo's affiliated Community Development Entities (CDEs), in connection with our participation in the federal government's New Markets Tax Credit Program (NMTC). The NMTC was established by Congress in 2000 to facilitate new or increased investments in businesses and real estate projects in low-income communities. The NMTC attracts investment capital to low-income communities by permitting investors to receive a tax credit against their federal income tax return in exchange for equity investments in specialized financial institutions, called CDEs, which provide financing to qualified active businesses operating in low-income communities. The credit amounts to 39% of the original investment amount and is claimed over a period of seven years (five percent for each of the first three years, and six percent for each of the remaining four years). The investment in the CDE cannot be redeemed before the end of the seven-year period. | ||
In the fourth quarter of 2011, as a result of a series of simultaneous financing transactions, Wells Fargo contributed capital of $5.9 million to the Investment Fund, and Molina Healthcare, Inc. loaned the principal amount of $15.5 million to the Investment Fund. The Investment Fund then contributed the proceeds to certain CDEs, which, in turn, loaned the proceeds of $20.9 million to our New Mexico data center subsidiary. Wells Fargo will be entitled to claim the NMTC while we effectively received net loan proceeds equal to Wells Fargo's contribution to the Investment Fund, or approximately $5.9 million. Additionally, financing costs incurred in structuring the arrangement amounting to $1.2 million were deferred and will be recognized as expense over the term of the loans. This transaction also includes a put/call feature that becomes enforceable at the end of the seven-year compliance period. Wells Fargo may exercise its put option or we can exercise the call, both of which will serve to transfer the debt obligation to us. Incremental costs to maintain the structure during the compliance period will be recognized as incurred. | ||
We have determined that the financing arrangement with Investment Fund and CDEs is a VIE, and that we are the primary beneficiary of the VIE. We reached this conclusion based on the following: | ||
• | The ongoing activities of the VIE-collecting and remitting interest and fees and NMTC compliance-were all considered in the initial design and are not expected to significantly affect economic performance throughout the life of the VIE; | |
• | Contractual arrangements obligate us to comply with NMTC rules and regulations and provide various other guarantees to Investment Fund and CDEs; | |
• | Wells Fargo lacks a material interest in the underling economics of the project; and | |
• | We are obligated to absorb losses of the VIE. | |
Because we are the primary beneficiary of the VIE, we have included it in our consolidated financial statements. Wells Fargo's contribution of $5.9 million is included in cash at December 31, 2013 and December 31, 2012 and the offsetting Wells Fargo's interest in the financing arrangement is included in other liabilities in the accompanying consolidated balance sheets. | ||
As described above, this transaction also includes a put/call provision whereby we may be obligated or entitled to repurchase Wells Fargo's interest in the Investment Fund. The value attributed to the put/call is nominal. The NMTC is subject to 100% recapture for a period of seven years as provided in the Internal Revenue Code and applicable U.S. Treasury regulations. We are required to be in compliance with various regulations and contractual provisions that apply to the NMTC arrangement. Non-compliance with applicable requirements could result in Wells Fargo's projected tax benefits not being realized and, therefore, require us to indemnify Wells Fargo for any loss or recapture of NMTCs related to the financing until such time as the recapture provisions have expired under the applicable statute of limitations. We do not anticipate any credit recaptures will be required in connection with this arrangement. |
Commitments_and_Contingencies_
Commitments and Contingencies (Notes) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||
Commitments and Contingencies | ' | |||||||||||||||
Commitments and Contingencies | ||||||||||||||||
Certain Leasing Transactions | ||||||||||||||||
As described in Note 12, "Long-Term Debt," we entered into certain leasing transactions that have been classified as lease financing obligations. For the transaction entered into in June 2013, the initial lease term is 25 years, with five five-year renewal options. For the transaction relating to the construction project completed in June 2013, the initial lease term is 11.5 years, with two five-year renewal options. | ||||||||||||||||
Operating Leases | ||||||||||||||||
We lease administrative and clinic facilities and certain equipment under non-cancelable operating leases expiring at various dates through 2023. Facility lease terms generally range from five to ten years with one to two renewal options for extended terms. In most cases, we are required to make additional payments under facility operating leases for taxes, insurance and other operating expenses incurred during the lease period. Certain of our leases contain rent escalation clauses or lease incentives, including rent abatements and tenant improvement allowances. Rent escalation clauses and lease incentives are taken into account in determining total rent expense to be recognized during the lease term. | ||||||||||||||||
Future minimum lease payments by year and in the aggregate under all operating leases and lease financing obligations consist of the following approximate amounts: | ||||||||||||||||
Lease Financing Obligations | Lease Financing Obligations - Related Party | Operating Leases | Total | |||||||||||||
(In thousands) | ||||||||||||||||
2014 | $ | 11,065 | $ | 3,330 | $ | 29,117 | $ | 43,512 | ||||||||
2015 | 11,397 | 6,880 | 23,196 | 41,473 | ||||||||||||
2016 | 11,739 | 7,138 | 15,890 | 34,767 | ||||||||||||
2017 | 12,091 | 7,405 | 14,434 | 33,930 | ||||||||||||
2018 | 12,454 | 7,683 | 12,832 | 32,969 | ||||||||||||
Thereafter | 333,275 | 52,538 | 13,569 | 399,382 | ||||||||||||
Total minimum lease payments | $ | 392,021 | $ | 84,974 | $ | 109,038 | $ | 586,033 | ||||||||
Rental expense related to operating leases amounted to $24.5 million, $20.5 million, and $23.1 million for the years ended December 31, 2013, 2012, and 2011, respectively. The amounts reported in "Lease Financing Obligations," and "Lease Financing Obligations - Related Party," above represent our contractual lease commitments for the properties described in Note 12, "Long-Term Debt" under the subheading "Lease Financing Obligations." Payments under these leases adjust the lease financing obligation, and the imputed interest is recorded to interest expense in our consolidated statements of income. | ||||||||||||||||
Employment Agreements | ||||||||||||||||
In 2002 we entered into employment agreements with our Chief Executive Officer and Chief Financial Officer, which were amended and restated in 2009. These employment agreements had initial terms of one to three years and are subject to automatic one-year extensions thereafter. Should the executives be terminated without cause or resign for good reason before a change of control, as defined, we will pay one year’s base salary and termination bonus, as defined, in addition to full vesting of stock-based awards, and a cash payment for health and welfare benefits. | ||||||||||||||||
In 2013 we entered into employment agreements with our Chief Operating Officer, Chief Accounting Officer, and Chief Legal Officer. These agreements continue until terminated by us, or the executive resigns. If the executive’s employment is terminated by us without cause or the executive resigns for good reason, the executive will be entitled to receive one year’s base salary and termination bonus, as defined, full vesting of all time-based equity compensation, and a cash payment for health and welfare benefits. | ||||||||||||||||
Payment of the executives’ severance benefits is contingent upon the executive’s signing a release agreement waiving claims against us. If the executives are terminated for cause, no further payments are due under the contracts. | ||||||||||||||||
Legal Proceedings | ||||||||||||||||
The health care and business process outsourcing industries are subject to numerous laws and regulations of federal, state, and local governments. Compliance with these laws and regulations can be subject to government review and interpretation, as well as regulatory actions unknown and unasserted at this time. Penalties associated with violations of these laws and regulations include significant fines and penalties, exclusion from participating in publicly funded programs, and the repayment of previously billed and collected revenues. | ||||||||||||||||
We are involved in legal actions in the ordinary course of business, some of which seek monetary damages, including claims for punitive damages, which are not covered by insurance. We have accrued liabilities for certain matters for which we deem the loss to be both probable and estimable. Although we believe that our estimates of such losses are reasonable, these estimates could change as a result of further developments of these matters. The outcome of legal actions is inherently uncertain and such pending matters for which accruals have not been established have not progressed sufficiently through discovery and/or development of important factual information and legal issues to enable us to estimate a range of possible loss, if any. While it is not possible to accurately predict or determine the eventual outcomes of these items, an adverse determination in one or more of these pending matters could have a material adverse effect on our consolidated financial condition, cash flows, or results of operations. | ||||||||||||||||
Washington Health Plan | ||||||||||||||||
The Washington Health Care Authority (HCA) has communicated that it believes it has erroneously overpaid our Washington health plan with regard to certain claims. The alleged overpayments, which were incorporated into the capitation rates paid to our Washington health plan, date back to the July 1, 2012 start date of the current contract. However, HCA has provided us with minimal data by which we might independently validate such allegations. Furthermore, the alleged errors, if they in fact occurred, were unilateral errors by HCA for which our Washington health plan had assumed and bore no contractual risk. We believe that any actual liability for the alleged overpayment claims is not currently probable or reasonably estimable. | ||||||||||||||||
California Health Plan Rate Settlement Agreement | ||||||||||||||||
In the fourth quarter of 2013, our California health plan entered into a settlement agreement with the California Department of Health Care Services (DHCS). The agreement settled rate disputes initiated by our California health plan dating back to 2003 with respect to its participation in Medi-Cal (California’s Medicaid program). | ||||||||||||||||
Under the terms of the settlement agreement, DHCS has agreed to extend each of the California health plan’s existing Medi-Cal managed care contracts for an additional five years, including its contracts in San Diego, San Bernardino, Riverside, and Sacramento counties. In addition, effective January 1, 2014, the settlement established a settlement account applicable to the California health plan’s Medi-Cal, Seniors and Persons with Disabilities (SPD), and the dual eligibles pilot programs. The settlement account was established with an initial balance of zero, and will be adjusted annually to reflect a calendar year deficit or surplus. A deficit or surplus will result to the extent the health plan’s pre-tax margin is below or above 3.25%, subject to further adjustment as specified in the settlement agreement. Such settlement amount shall be based on 75% of the health plan’s revenue in 2014; and 50% of the health plan’s revenue in each subsequent year of the settlement agreement. Cash settlement will occur after December 31, 2017. DHCS will make an interim partial settlement payment to us if it terminates early, without replacement, any of our Medi-Cal managed care contracts. Upon expiration of the settlement agreement, if the settlement account is in a deficit position, then DHCS will pay the amount of the deficit to us, subject to an alternative minimum payment amount. The alternative minimum amount is calculated as follows: (i) $40 million, minus (ii) any partial settlement payments previously made to our California health plan by DHCS, minus (iii) 50% of the pre-tax income on our Medi-Cal, SPD, and dual eligibles pilot program business in excess of a 2.0% pre-tax margin for each calendar from 2014 through 2017. If the settlement account is in a surplus position, then no amount is owed to either party. The maximum amount that DHCS would pay to us under the terms of the settlement agreement is $40 million. | ||||||||||||||||
The settlement agreement did not impact our consolidated financial condition, cash flows, or results of operations for the year ending December 31, 2013. | ||||||||||||||||
Professional Liability Insurance | ||||||||||||||||
We carry medical professional liability insurance for health care services rendered through our primary care clinics. We also carry claims-made managed care errors and omissions professional liability insurance for our health plan operations. | ||||||||||||||||
Provider Claims | ||||||||||||||||
Many of our medical contracts are complex in nature and may be subject to differing interpretations regarding amounts due for the provision of various services. Such differing interpretations have led certain medical providers to pursue us for additional compensation. The claims made by providers in such circumstances often involve issues of contract compliance, interpretation, payment methodology, and intent. These claims often extend to services provided by the providers over a number of years. | ||||||||||||||||
Various providers have contacted us seeking additional compensation for claims that we believe to have been settled. These matters, when finally concluded and determined, will not, in our opinion, have a material adverse effect on our business, consolidated financial position, results of operations, or cash flows. | ||||||||||||||||
Regulatory Capital and Dividend Restrictions | ||||||||||||||||
Our health plans, which are operated by our respective wholly owned subsidiaries in those states, are subject to state laws and regulations that, among other things, require the maintenance of minimum levels of statutory capital, as defined by each state. Regulators in some states may also attempt to enforce capital requirements upon us that require the retention of net worth in excess of amounts formally required by statute or regulation. Such statutes, regulations and informal capital requirements also restrict the timing, payment, and amount of dividends and other distributions that may be paid to us as the sole stockholder. To the extent our subsidiaries must comply with these regulations, they may not have the financial flexibility to transfer funds to us. Based upon current statutes and regulations, the net assets in these subsidiaries (after intercompany eliminations) which may not be transferable to us in the form of loans, advances, or cash dividends was approximately $608 million at December 31, 2013, and $550 million at December 31, 2012. Because of the statutory restrictions that inhibit the ability of our health plans to transfer net assets to us, the amount of retained earnings readily available to pay dividends to our stockholders is generally limited to cash, cash equivalents and investments held by the parent company – Molina Healthcare, Inc. Such cash, cash equivalents and investments amounted to $365.2 million and $46.9 million as of December 31, 2013, and 2012, respectively. | ||||||||||||||||
The National Association of Insurance Commissioners (NAIC), adopted rules effective December 31, 1998, which, if implemented by the states, set minimum capitalization requirements for insurance companies, HMOs, and other entities bearing risk for health care coverage. The requirements take the form of risk-based capital (RBC), rules. All of our state health plans have adopted these rules, which may vary from state to state, except California and Florida. California and Florida have not adopted NAIC risk-based capital requirements for HMOs, and have not formally given notice of their intention to do so. Such requirements, if adopted by California and Florida, may increase the minimum capital required for those states. | ||||||||||||||||
As of December 31, 2013, our health plans had aggregate statutory capital and surplus of approximately $662 million compared with the legally required minimum aggregate statutory capital and surplus of approximately $389 million. As described in Note 2, "Significant Accounting Policies," under the subheading "Recent Accounting Pronouncements," we anticipate that the health care federal excise tax on health insurers will result in the recording of a liability of approximately $85 million spread across our all of our health plans. The liability for that excise tax, when recorded effective January 1, 2014, will reduce our aggregate statutory capital and surplus by the same amount. All of our health plans were in compliance with the minimum capital requirements at December 31, 2013. We have the ability and commitment to provide additional capital to each of our health plans when necessary to ensure that statutory capital and surplus continue to meet regulatory requirements. | ||||||||||||||||
Receivable/Liability for Ceded Life and Annuity Contracts | ||||||||||||||||
Prior to February 2012, we reported a 100% ceded reinsurance arrangement for life insurance policies written and held by our then wholly owned insurance subsidiary, Molina Healthcare Insurance Company, by recording a non-current receivable from the reinsurer with a corresponding non-current liability for ceded life and annuity contracts. In February 2012, we sold Molina Healthcare Insurance Company and recorded a gain of $1.7 million to general and administrative expenses in 2012 upon closing of the transaction. | ||||||||||||||||
Molina Healthcare Insurance Company is now named Catamaran Insurance of Ohio (Catamaran). In the event that both the reinsurer and Catamaran are unable to pay benefits on policies that were in-force as of the sale date, we remain ultimately liable for payment of such benefits. Because we no longer own Catamaran, we no longer have access to its financial records; therefore, the maximum amount of potential future payments is not determinable. We believe the possibility of our having to pay such benefits is remote, and no provision for the payment of such benefits is included in our consolidated financial statements. |
Segment_Information_Notes
Segment Information (Notes) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||
Segment Information | ' | |||||||||||
Segment Information | ||||||||||||
We report our financial performance based on two reportable segments: the Health Plans segment and the Molina Medicaid Solutions segment. Our reportable segments are consistent with how we manage the business and view the markets we serve. Our Health Plans segment consists of our state health plans and also includes our direct delivery business. Our state health plans represent operating segments that have been aggregated for reporting purposes because they share similar economic characteristics. | ||||||||||||
Our Molina Medicaid Solutions segment provides MMIS design, development and implementation; business process outsourcing solutions; hosting services; and information technology support services to Medicaid agencies. | ||||||||||||
We rely on an internal management reporting process that provides segment information to the operating income level for purposes of making financial decisions and allocating resources. The accounting policies of the segments are the same as those described in Note 2, “Significant Accounting Policies.” The cost of services shared between the Health Plans and Molina Medicaid Solutions segments is charged to the Health Plans segment. | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Revenue from continuing operations: | ||||||||||||
Health Plans segment: | ||||||||||||
Premium revenue | $ | 6,179,170 | $ | 5,544,121 | $ | 4,211,493 | ||||||
Premium tax revenue | 172,017 | 158,991 | 154,589 | |||||||||
Investment income | 6,890 | 5,075 | 5,446 | |||||||||
Rental income and other revenue | 26,322 | 18,312 | 8,288 | |||||||||
Molina Medicaid Solutions segment: | ||||||||||||
Service revenue | 204,535 | 187,710 | 160,447 | |||||||||
$ | 6,588,934 | $ | 5,914,209 | $ | 4,540,263 | |||||||
Depreciation and amortization reported in the consolidated statements of cash flows: | ||||||||||||
Health Plans segment | $ | 67,446 | $ | 58,577 | $ | 45,734 | ||||||
Molina Medicaid Solutions segment | 26,420 | 20,187 | 28,649 | |||||||||
$ | 93,866 | $ | 78,764 | $ | 74,383 | |||||||
Operating income from continuing operations: | ||||||||||||
Health Plans segment | $ | 103,931 | $ | 17,366 | $ | 133,758 | ||||||
Molina Medicaid Solutions segment | 32,629 | 23,727 | 2,063 | |||||||||
Total operating income from continuing operations | 136,560 | 41,093 | 135,821 | |||||||||
Interest expense | 52,071 | 16,769 | 15,519 | |||||||||
Other expenses | 3,343 | 945 | — | |||||||||
Income from continuing operations before income taxes | $ | 81,146 | $ | 23,379 | $ | 120,302 | ||||||
As of December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Goodwill and intangible assets, net: | ||||||||||||
Health Plans segment | $ | 248,562 | $ | 139,710 | $ | 159,963 | ||||||
Molina Medicaid Solutions segment | 81,047 | 89,089 | 95,787 | |||||||||
$ | 329,609 | $ | 228,799 | $ | 255,750 | |||||||
Total assets: | ||||||||||||
Health Plans segment | $ | 2,809,439 | $ | 1,702,212 | $ | 1,429,283 | ||||||
Molina Medicaid Solutions segment | 193,498 | 232,610 | 222,863 | |||||||||
$ | 3,002,937 | $ | 1,934,822 | $ | 1,652,146 | |||||||
Goodwill and intangible assets increased in the Health Plans segment due to the acquisitions described in Note 4, "Business Combinations." |
Quarterly_Results_of_Operation
Quarterly Results of Operations (Unaudited) (Notes) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||||
Quarterly Results of Operations (Unaudited) | ' | |||||||||||||||
Quarterly Results of Operations (Unaudited) | ||||||||||||||||
The following table summarizes quarterly unaudited results of operations for the years ended December 31, 2013 and 2012. We previously reported that our Medicaid managed care contract with the state of Missouri expired without renewal on June 30, 2012. Effective June 30, 2013 the transition obligations associated with that contract terminated. Therefore, we have reclassified the results relating to the Missouri health plan to discontinued operations for all periods presented. | ||||||||||||||||
For The Quarter Ended | ||||||||||||||||
March 31, | June 30, 2013(3) | 30-Sep-13 | December 31, | |||||||||||||
2013(1) | 2013 | |||||||||||||||
(In thousands, except per-share data) | ||||||||||||||||
Premium revenue (2) | $ | 1,497,433 | $ | 1,501,729 | $ | 1,584,656 | $ | 1,595,352 | ||||||||
Service revenue | 49,756 | 49,672 | 51,100 | 54,007 | ||||||||||||
Operating income (loss), Health Plans segment | 61,520 | 40,151 | 16,929 | (14,669 | ) | |||||||||||
Operating income, Molina Medicaid Solutions segment | 6,353 | 6,295 | 7,997 | 11,984 | ||||||||||||
Income (loss) from continuing operations | $ | 30,522 | $ | 15,796 | $ | 7,553 | $ | (9,041 | ) | |||||||
(Loss) income from discontinued operations | (607 | ) | 8,775 | 16 | (85 | ) | ||||||||||
Net income (loss) | $ | 29,915 | $ | 24,571 | $ | 7,569 | $ | (9,126 | ) | |||||||
Net income (loss) per share (4): | ||||||||||||||||
Basic | $ | 0.65 | $ | 0.54 | $ | 0.17 | $ | (0.20 | ) | |||||||
Diluted | $ | 0.64 | $ | 0.53 | $ | 0.16 | $ | (0.20 | ) | |||||||
For The Quarter Ended | ||||||||||||||||
March 31, | 30-Jun-12 | 30-Sep-12 | December 31, | |||||||||||||
2012(1) | 2012 | |||||||||||||||
(In thousands, except per-share data) | ||||||||||||||||
Premium revenue (2) | $ | 1,225,363 | $ | 1,392,774 | $ | 1,448,600 | $ | 1,477,384 | ||||||||
Service revenue | 42,205 | 41,724 | 48,422 | 55,359 | ||||||||||||
Operating income (loss), Health Plans segment | 27,903 | (56,072 | ) | (5,788 | ) | 51,323 | ||||||||||
Operating income, Molina Medicaid Solutions segment | 8,409 | 6,642 | 8,156 | 520 | ||||||||||||
Income (loss) from continuing operations | $ | 19,894 | $ | (33,057 | ) | $ | (165 | ) | $ | 26,194 | ||||||
(Loss) income from discontinued operations | (1,805 | ) | (4,249 | ) | 3,529 | (551 | ) | |||||||||
Net income (loss) | $ | 18,089 | $ | (37,306 | ) | $ | 3,364 | $ | 25,643 | |||||||
Net income (loss) per share (4): | ||||||||||||||||
Basic | $ | 0.39 | $ | (0.80 | ) | $ | 0.07 | $ | 0.55 | |||||||
Diluted | $ | 0.39 | $ | (0.80 | ) | $ | 0.07 | $ | 0.54 | |||||||
_______________________________ | ||||||||||||||||
-1 | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. | |||||||||||||||
-2 | Prior to the third quarter of 2013, premium tax revenue was included in premium revenue. The presentation change reduced premium revenue for the amount now reported as premium tax revenue. In connection with this presentation change, amounts differ from the amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue reported for the quarter ended March 31, 2013 and 2012 decreased $37.0 million and $43.4 million, respectively; premium revenue reported for the quarter ended June 30, 2013 and 2012 decreased $46.9 million and $39.6 million, respectively. | |||||||||||||||
-3 | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | |||||||||||||||
-4 | Potentially dilutive shares issuable pursuant to our 1.125% Warrants were not included in the computation of diluted net income per share for all quarters in 2013, because to do so would have been anti-dilutive. Potentially dilutive shares issuable pursuant to our 3.75% Notes were not included in the computation of diluted net income per share for the quarters ended March 31, 2013, June 30, 2013, and all quarters in 2012, because to do so would have been anti-dilutive. |
Condensed_Financial_Informatio
Condensed Financial Information of Registrant (Notes) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | ' | |||||||||||
Condensed Financial Information of Registrant | ' | |||||||||||
Condensed Financial Information of Registrant | ||||||||||||
Following are our parent company only condensed balance sheets as of December 31, 2013 and 2012, and our condensed statements of income, condensed statements of comprehensive income and condensed statements of cash flows for each of the three years in the period ended December 31, 2013. | ||||||||||||
Condensed Balance Sheets | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
(Amounts in thousands, except per-share data) | ||||||||||||
ASSETS | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $ | 99,698 | $ | 39,068 | ||||||||
Investments | 262,665 | 2,015 | ||||||||||
Income tax refundable | 8,403 | 8,868 | ||||||||||
Deferred income taxes | 10,073 | 9,706 | ||||||||||
Due from affiliates | 35,928 | 55,382 | ||||||||||
Prepaid and other current assets | 28,387 | 19,164 | ||||||||||
Total current assets | 445,154 | 134,203 | ||||||||||
Property and equipment, net | 225,522 | 108,808 | ||||||||||
Goodwill and intangible assets, net | 68,902 | 52,302 | ||||||||||
Investments in subsidiaries | 992,998 | 768,765 | ||||||||||
Deferred income taxes | 17,245 | — | ||||||||||
Derivative asset | 186,351 | — | ||||||||||
Advances to related parties and other assets | 52,615 | 38,215 | ||||||||||
$ | 1,988,787 | $ | 1,102,293 | |||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||
Liabilities: | ||||||||||||
Accounts payable and accrued liabilities | $ | 109,388 | $ | 73,883 | ||||||||
Long-term debt | 784,862 | 215,468 | ||||||||||
Deferred income taxes | — | 17,122 | ||||||||||
Derivative liability | 186,239 | — | ||||||||||
Other long-term liabilities | 15,361 | 13,506 | ||||||||||
Total liabilities | 1,095,850 | 319,979 | ||||||||||
Stockholders' equity: | ||||||||||||
Common stock, $0.001 par value; 150,000 shares authorized; outstanding: | ||||||||||||
45,871 shares at December 31, 2013 and 46,762 shares at December 31, 2012 | 46 | 47 | ||||||||||
Preferred stock, $0.001 par value; 20,000 shares authorized, no shares issued and outstanding | — | — | ||||||||||
Paid-in capital | 340,848 | 285,524 | ||||||||||
Accumulated other comprehensive loss | (1,086 | ) | (457 | ) | ||||||||
Treasury stock, at cost; outstanding: 111 shares at December 31, 2012 | — | (3,000 | ) | |||||||||
Retained earnings | 553,129 | 500,200 | ||||||||||
Total stockholders' equity | 892,937 | 782,314 | ||||||||||
$ | 1,988,787 | $ | 1,102,293 | |||||||||
Condensed Statements of Income | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Revenue: | ||||||||||||
Management fees and other operating revenue | $ | 599,049 | $ | 406,981 | $ | 308,287 | ||||||
Investment income | 2,768 | 550 | 81 | |||||||||
Total revenue | 601,817 | 407,531 | 308,368 | |||||||||
Expenses: | ||||||||||||
Medical care costs | 37,862 | 33,102 | 31,672 | |||||||||
General and administrative expenses | 503,781 | 367,606 | 272,302 | |||||||||
Depreciation and amortization | 51,562 | 38,794 | 31,355 | |||||||||
Total expenses | 593,205 | 439,502 | 335,329 | |||||||||
Operating income (loss) | 8,612 | (31,971 | ) | (26,961 | ) | |||||||
Interest expense | 50,508 | 14,469 | 14,958 | |||||||||
Other expense | 3,811 | — | — | |||||||||
Loss before income taxes and equity in net income of subsidiaries | (45,707 | ) | (46,440 | ) | (41,919 | ) | ||||||
Income tax benefit | (15,455 | ) | (15,779 | ) | (14,826 | ) | ||||||
Net loss before equity in net income of subsidiaries | (30,252 | ) | (30,661 | ) | (27,093 | ) | ||||||
Equity in net income of subsidiaries | 83,181 | 40,451 | 47,911 | |||||||||
Net income | $ | 52,929 | $ | 9,790 | $ | 20,818 | ||||||
Condensed Statements of Comprehensive Income | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Net income | $ | 52,929 | $ | 9,790 | $ | 20,818 | ||||||
Other comprehensive income: | ||||||||||||
Gross unrealized investment (loss) gain | (1,015 | ) | 1,529 | 1,167 | ||||||||
Effect of income tax (benefit) expense | (386 | ) | 581 | 380 | ||||||||
Other comprehensive (loss) income, net of tax | (629 | ) | 948 | 787 | ||||||||
Comprehensive income | $ | 52,300 | $ | 10,738 | $ | 21,605 | ||||||
Condensed Statements of Cash Flows | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Operating activities: | ||||||||||||
Net cash provided by operating activities | $ | 62,602 | $ | 20,611 | $ | 28,606 | ||||||
Investing activities: | ||||||||||||
Capital contributions to subsidiaries | (166,112 | ) | (100,221 | ) | (58,412 | ) | ||||||
Dividends received from subsidiaries | 24,429 | 101,800 | 86,284 | |||||||||
Purchases of investments | (362,927 | ) | (1,905 | ) | (2,020 | ) | ||||||
Sales and maturities of investments | 97,713 | 4,067 | 3,760 | |||||||||
Proceeds from sale of subsidiary, net of cash surrendered | — | 9,162 | — | |||||||||
Purchases of equipment | (76,873 | ) | (61,813 | ) | (30,930 | ) | ||||||
Changes in amounts due to/from affiliates | (5,888 | ) | 5,187 | (50,090 | ) | |||||||
Change in other assets and liabilities | (6,175 | ) | (1,342 | ) | (20,441 | ) | ||||||
Net cash used in investing activities | (495,833 | ) | (45,065 | ) | (71,849 | ) | ||||||
Financing activities: | ||||||||||||
Proceeds from issuance of 1.125% Notes, net of deferred issuance costs | 537,973 | — | — | |||||||||
Proceeds from sale-leaseback transactions | 158,694 | — | — | |||||||||
Purchase of 1.125% Notes call option | (149,331 | ) | — | — | ||||||||
Proceeds from issuance of warrants | 75,074 | — | — | |||||||||
Treasury stock repurchases | (52,662 | ) | (3,000 | ) | (7,000 | ) | ||||||
Principal payment on term loan of subsidiary | (46,963 | ) | — | — | ||||||||
Payment of credit facility fees | — | — | (1,125 | ) | ||||||||
Repayment of amount borrowed under credit facility | (40,000 | ) | (20,000 | ) | — | |||||||
Proceeds from exercise of stock options and employee stock plan purchases | 9,402 | 8,205 | 7,347 | |||||||||
Excess tax benefits from employee stock compensation | 1,674 | 3,667 | 1,651 | |||||||||
Amount borrowed under credit facility | — | 60,000 | — | |||||||||
Net cash provided by financing activities | 493,861 | 48,872 | 873 | |||||||||
Net increase (decrease) in cash and cash equivalents | 60,630 | 24,418 | (42,370 | ) | ||||||||
Cash and cash equivalents at beginning of year | 39,068 | 14,650 | 57,020 | |||||||||
Cash and cash equivalents at end of year | $ | 99,698 | $ | 39,068 | $ | 14,650 | ||||||
Notes to Condensed Financial Information of Registrant | ||||||||||||
Note A - Basis of Presentation | ||||||||||||
Molina Healthcare, Inc. (the Registrant, or the Parent), was incorporated on July 24, 2002. Prior to that date, Molina Healthcare of California (formerly known as Molina Medical Centers) operated as a California health plan and as the parent company for Molina Healthcare of Utah, Inc. Molina Healthcare of Michigan, Inc. and Molina Healthcare of Washington, Inc. In June 2003, the employees and operations of the corporate entity were transferred from Molina Healthcare of California to the Registrant. | ||||||||||||
The Registrant's investment in subsidiaries is stated at cost plus equity in undistributed earnings of subsidiaries since the date of acquisition. The accompanying condensed financial information of the Registrant should be read in conjunction with the consolidated financial statements and accompanying notes. | ||||||||||||
Note B - Transactions with Subsidiaries | ||||||||||||
The Registrant provides certain centralized medical and administrative services to its subsidiaries pursuant to administrative services agreements, including medical affairs and quality management, health education, credentialing, management, financial, legal, information systems and human resources services. Fees are based on the fair market value of services rendered and are recorded as operating revenue. Payment is subordinated to the subsidiaries' ability to comply with minimum capital and other restrictive financial requirements of the states in which they operate. Charges in 2013, 2012, and 2011 for these services amounted to $592.1 million, $406.4 million, and $307.9 million, respectively, which are included in operating revenue. | ||||||||||||
During 2013, the Registrant used a portion of the proceeds from the sale of the Molina Center, described in Note 12, "Long-Term Debt," to repay the remaining principal balance of the related term loan, on behalf of a subsidiary of the Registrant. | ||||||||||||
The Registrant and its subsidiaries are included in the consolidated federal and state income tax returns filed by the Registrant. Income taxes are allocated to each subsidiary in accordance with an intercompany tax allocation agreement. The agreement allocates income taxes in an amount generally equivalent to the amount which would be expensed by the subsidiary if it filed a separate tax return. Net operating loss benefits are paid to the subsidiary by the Registrant to the extent such losses are utilized in the consolidated tax returns. | ||||||||||||
Note C - Dividends, Capital Contributions and Surplus Note | ||||||||||||
During 2013, 2012, and 2011, the Registrant received dividends from its subsidiaries. Such amounts have been recorded as a reduction to the investments in the respective subsidiaries. In addition, in 2011 a subsidiary of the Registrant repaid a surplus note in favor of the Registrant amounting to $9.7 million, including accrued interest. Such amount was a reduction of due from affiliates and prepaid and other current assets. | ||||||||||||
During 2013, 2012, and 2011, the Registrant made capital contributions to certain subsidiaries primarily to comply with minimum net worth requirements and to fund contract acquisitions. Such amounts have been recorded as an increase in investment in the respective subsidiaries, net of insignificant returns of capital. | ||||||||||||
Note D - Related Party Transactions | ||||||||||||
The Registrant's related party transactions are described in Note 18, "Related Party Transactions." |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||||||||||||||||||
Consolidation | ' | ||||||||||||||||||||||||||||||||
Consolidation | |||||||||||||||||||||||||||||||||
The consolidated financial statements include the accounts of Molina Healthcare, Inc., its subsidiaries, and variable interest entities in which Molina Healthcare, Inc. is considered to be the primary beneficiary. See Note 19, “Variable Interest Entities,” for more information regarding these variable interest entities. In the opinion of management, all adjustments considered necessary for a fair presentation of the results as of the date and for the periods presented have been included; such adjustments consist of normal recurring adjustments. All significant inter-company balances and transactions have been eliminated in consolidation. Financial information related to subsidiaries acquired during any year is included only for periods subsequent to their acquisition. | |||||||||||||||||||||||||||||||||
Use of Estimates | ' | ||||||||||||||||||||||||||||||||
Use of Estimates | |||||||||||||||||||||||||||||||||
The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements. Estimates also affect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Principal areas requiring the use of estimates include: | |||||||||||||||||||||||||||||||||
• | Health plan contractual provisions that may limit revenue based upon the costs incurred or the profits realized under a specific contract; | ||||||||||||||||||||||||||||||||
• | Health plan quality incentives that allow us to recognize incremental revenue if certain quality standards are met; | ||||||||||||||||||||||||||||||||
• | The determination of medical claims and benefits payable of our Health Plans segment; | ||||||||||||||||||||||||||||||||
• | The valuation of certain investments; | ||||||||||||||||||||||||||||||||
• | Settlements under risk or savings sharing programs; | ||||||||||||||||||||||||||||||||
• | The assessment of deferred contract costs, deferred revenue, long-lived and intangible assets, and goodwill for impairment; | ||||||||||||||||||||||||||||||||
• | The determination of professional and general liability claims, and reserves for potential absorption of claims unpaid by insolvent providers; | ||||||||||||||||||||||||||||||||
• | The determination of reserves for the outcome of litigation; | ||||||||||||||||||||||||||||||||
• | The determination of valuation allowances for deferred tax assets; and | ||||||||||||||||||||||||||||||||
• | The determination of unrecognized tax benefits. | ||||||||||||||||||||||||||||||||
Cash and Cash Equivalents | ' | ||||||||||||||||||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||||||||||||||||||
Cash and cash equivalents consist of cash and short-term, highly liquid investments that are both readily convertible into known amounts of cash and have a maturity of three months or less on the date of purchase. | |||||||||||||||||||||||||||||||||
Investments | ' | ||||||||||||||||||||||||||||||||
Investments | |||||||||||||||||||||||||||||||||
Our investments are principally held in debt securities, which are grouped into two separate categories for accounting and reporting purposes: available-for-sale securities, and held-to-maturity securities. Available-for-sale securities are recorded at fair value and unrealized gains and losses, if any, are recorded in stockholders’ equity as other comprehensive income, net of applicable income taxes. Held-to-maturity securities are recorded at amortized cost, which approximates fair value, and unrealized holding gains or losses are not generally recognized. Realized gains and losses and unrealized losses judged to be other than temporary with respect to available-for-sale and held-to-maturity securities are included in the determination of net income. The cost of securities sold is determined using the specific-identification method, on an amortized cost basis. | |||||||||||||||||||||||||||||||||
Our investment policy requires that all of our investments have final maturities of five years or less (excluding auction rate and variable rate securities where interest rates may be periodically reset), and that the average maturity be two years or less. Investments and restricted investments are subject to interest rate risk and will decrease in value if market rates increase. Declines in interest rates over time will reduce our investment income. | |||||||||||||||||||||||||||||||||
In general, our available-for-sale securities are classified as current assets without regard to the securities’ contractual maturity dates because they may be readily liquidated. Our auction rate securities are classified as non-current assets. For comprehensive discussions of the fair value and classification of our current and non-current investments, including auction rate securities, see Note 5, “Fair Value Measurements,” Note 6, “Investments,” and Note 10, “Restricted Investments.” | |||||||||||||||||||||||||||||||||
Receivables | ' | ||||||||||||||||||||||||||||||||
Receivables | |||||||||||||||||||||||||||||||||
Receivables are readily determinable, our creditors are primarily state governments, and our allowance for doubtful accounts is immaterial. Any amounts determined to be uncollectible are charged to expense when such determination is made. | |||||||||||||||||||||||||||||||||
Property, Equipment, and Capitalized Software | ' | ||||||||||||||||||||||||||||||||
Property, Equipment, and Capitalized Software | |||||||||||||||||||||||||||||||||
Property and equipment are stated at historical cost. Replacements and major improvements are capitalized, and repairs and maintenance are charged to expense as incurred. Furniture and equipment are generally depreciated using the straight-line method over estimated useful lives ranging from three to seven years. Software developed for internal use is capitalized. Software is generally amortized over its estimated useful life of three years. Leasehold improvements are amortized over the term of the lease, or over their useful lives from five to 10 years, whichever is shorter. Buildings are depreciated over their estimated useful lives of 31.5 to 40 years. See Note 8, “Property, Equipment, and Capitalized Software.” | |||||||||||||||||||||||||||||||||
As discussed below, the costs associated with certain of our Molina Medicaid Solutions segment equipment and software are capitalized and recorded as deferred contract costs. Such costs are amortized on a straight-line basis over the shorter of the useful life or the contract period. | |||||||||||||||||||||||||||||||||
Depreciation and Amortization | ' | ||||||||||||||||||||||||||||||||
Depreciation and Amortization | |||||||||||||||||||||||||||||||||
Depreciation and amortization related to our Health Plans segment is all recorded in “Depreciation and Amortization” in the consolidated statements of income. Depreciation and amortization related to our Molina Medicaid Solutions segment is recorded within three different headings in the consolidated statements of income as follows: | |||||||||||||||||||||||||||||||||
• | Amortization of purchased intangibles relating to customer relationships is reported as amortization within the heading “Depreciation and amortization;” | ||||||||||||||||||||||||||||||||
• | Amortization of purchased intangibles relating to contract backlog is recorded as a reduction of “Service revenue;” and | ||||||||||||||||||||||||||||||||
• | Amortization of capitalized software is recorded within the heading “Cost of service revenue.” | ||||||||||||||||||||||||||||||||
Long-Lived Assets, including Intangible Assets | ' | ||||||||||||||||||||||||||||||||
Long-Lived Assets, including Intangible Assets | |||||||||||||||||||||||||||||||||
Long-lived assets comprise primarily property, equipment, capitalized software and intangible assets. Finite-lived, separately-identifiable intangible assets are acquired in business combinations and are assets that represent future expected benefits but lack physical substance (such as purchased contract rights and provider contracts). Intangible assets are initially recorded at their fair values and are then amortized on a straight-line basis over their expected useful lives, generally between one and 15 years. | |||||||||||||||||||||||||||||||||
Identifiable intangible assets associated with Molina Medicaid Solutions are classified as either contract backlog or customer relationships as follows: | |||||||||||||||||||||||||||||||||
• | The contract backlog intangible asset comprises all contractual cash flows anticipated to be received during the remaining contracted period for each specific contract relating to work that was performed prior to acquisition. Because each acquired contract constitutes a single revenue stream, amortization of the contract backlog intangible is recorded to contra-service revenue so that amortization is matched to any revenues associated with contract performance that occurred prior to the acquisition date. The contract backlog intangible asset is amortized on a straight-line basis for each specific contract over periods generally ranging from one to six years. The contract backlog intangible assets will be fully amortized in 2015. | ||||||||||||||||||||||||||||||||
• | The customer relationship intangible asset comprises all contractual cash flows that are anticipated to be received during the option periods of each specific contract as well as anticipated renewals of those contracts. The customer relationship intangible is amortized on a straight-line basis for each specific contract over periods generally ranging from four to nine years. | ||||||||||||||||||||||||||||||||
Our intangible assets are subject to impairment tests when events or circumstances indicate that a finite-lived intangible asset’s (or asset group’s) carrying value may not be recoverable. Consideration is given to a number of potential impairment indicators. For example, our health plan subsidiaries have generally been successful in obtaining the renewal by amendment of their contracts in each state prior to the actual expiration of their contracts. However, there can be no assurance that these contracts will continue to be renewed as in the case of our Missouri health plan, described below. | |||||||||||||||||||||||||||||||||
Following the identification of any potential impairment indicators, to determine whether an impairment exists, we would compare the carrying amount of a finite-lived intangible asset with the undiscounted cash flows that are expected to result from the use of the asset or related group of assets. If it is determined that the carrying amount of the asset is not recoverable, the amount by which the carrying value exceeds the estimated fair value is recorded as an impairment. | |||||||||||||||||||||||||||||||||
Goodwill | ' | ||||||||||||||||||||||||||||||||
Goodwill | |||||||||||||||||||||||||||||||||
Goodwill represents the amount of the purchase price in excess of the fair values assigned to the underlying identifiable net assets of acquired businesses. Goodwill is not amortized, but is subject to an annual impairment test. Tests are performed more frequently if events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. | |||||||||||||||||||||||||||||||||
To determine whether goodwill is impaired, we measure the fair values of our reporting units and compare them to the carrying values of the respective units, including goodwill. If the fair value is less than the carrying value of the reporting unit, then the implied value of goodwill would be calculated and compared to the carrying amount of goodwill to determine whether goodwill is impaired. | |||||||||||||||||||||||||||||||||
We estimate the fair values of our reporting units using discounted cash flows. To determine fair values, we must make assumptions about a wide variety of internal and external factors. Significant assumptions used in the impairment analysis include financial projections of free cash flow (including significant assumptions about operations, capital requirements and income taxes), long-term growth rates for determining terminal value, and discount rates. | |||||||||||||||||||||||||||||||||
Restricted Investments | ' | ||||||||||||||||||||||||||||||||
Restricted Investments | |||||||||||||||||||||||||||||||||
Restricted investments, which consist of certificates of deposit and treasury securities, are designated as held-to-maturity and are carried at amortized cost, which approximates market value. The use of these funds is limited to specific purposes as required by each state, or as protection against the insolvency of capitated providers. We have the ability to hold our restricted investments until maturity and, as a result, we would not expect the value of these investments to decline significantly due to a sudden change in market interest rates. | |||||||||||||||||||||||||||||||||
Other Assets | ' | ||||||||||||||||||||||||||||||||
Other Assets | |||||||||||||||||||||||||||||||||
Other assets primarily includes deferred financing costs associated with our convertible senior notes and lease financing obligations, and certain investments held in connection with our employee deferred compensation program. The deferred financing costs are being amortized on a straight-line basis over the terms of the convertible senior notes and lease financing obligations. | |||||||||||||||||||||||||||||||||
Delegated Provider Insolvency | ' | ||||||||||||||||||||||||||||||||
Delegated Provider Insolvency | |||||||||||||||||||||||||||||||||
Circumstances may arise where providers to whom we have delegated risk are unable to pay claims they have incurred with third parties in connection with referral services (including hospital inpatient services) provided to our members. The inability of delegated providers to pay referral claims presents us with both immediate financial risk and potential disruption to member care. Depending on states’ laws, we may be held liable for such unpaid referral claims even though the delegated provider has contractually assumed such risk. Additionally, competitive pressures may force us to pay such claims even when we have no legal obligation to do so. To reduce the risk that delegated providers are unable to pay referral claims, we monitor the operational and financial performance of such providers. We also maintain contingency plans that include transferring members to other providers in response to potential network instability. | |||||||||||||||||||||||||||||||||
In certain instances, we have required providers to place funds on deposit with us as protection against their potential insolvency. These reserves are frequently in the form of segregated funds received from the provider and held by us or placed in a third-party financial institution. These funds may be used to pay claims that are the financial responsibility of the provider in the event the provider is unable to meet these obligations. Additionally, we have recorded liabilities for estimated losses arising from provider instability or insolvency in excess of provider funds on deposit with us. | |||||||||||||||||||||||||||||||||
Premium Revenue | ' | ||||||||||||||||||||||||||||||||
Premium Revenue | |||||||||||||||||||||||||||||||||
Premium revenue is fixed in advance of the periods covered and, except as described below, is not generally subject to significant accounting estimates. For the year ended December 31, 2013, we received approximately 97% of our premium revenue as a fixed amount per member per month (PMPM), pursuant to our contracts with state Medicaid agencies, Medicare and other managed care organizations for which we operate as a subcontractor. These premium revenues are recognized in the month that members are entitled to receive health care services. The state Medicaid programs and the federal Medicare program periodically adjust premium rates. | |||||||||||||||||||||||||||||||||
The following table summarizes premium revenue from continuing operations for the periods indicated: | |||||||||||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
California | $ | 749,755 | 12.1 | % | $ | 665,600 | 12 | % | $ | 567,677 | 13.5 | % | |||||||||||||||||||||
Florida | 264,998 | 4.3 | 228,832 | 4.1 | 203,904 | 4.8 | |||||||||||||||||||||||||||
Illinois | 8,121 | 0.1 | — | — | — | — | |||||||||||||||||||||||||||
Michigan | 676,000 | 11 | 646,551 | 11.7 | 623,394 | 14.8 | |||||||||||||||||||||||||||
New Mexico | 446,758 | 7.2 | 321,853 | 5.8 | 328,706 | 7.8 | |||||||||||||||||||||||||||
Ohio | 1,098,795 | 17.8 | 1,095,137 | 19.7 | 912,219 | 21.7 | |||||||||||||||||||||||||||
Texas | 1,291,001 | 20.9 | 1,233,621 | 22.2 | 402,178 | 9.5 | |||||||||||||||||||||||||||
Utah | 310,895 | 5 | 298,392 | 5.4 | 287,290 | 6.8 | |||||||||||||||||||||||||||
Washington | 1,168,405 | 18.9 | 974,712 | 17.6 | 808,458 | 19.2 | |||||||||||||||||||||||||||
Wisconsin | 143,465 | 2.3 | 70,678 | 1.3 | 69,552 | 1.7 | |||||||||||||||||||||||||||
Direct delivery | 20,977 | 0.4 | 8,745 | 0.2 | 8,115 | 0.2 | |||||||||||||||||||||||||||
$ | 6,179,170 | 100 | % | $ | 5,544,121 | 100 | % | $ | 4,211,493 | 100 | % | ||||||||||||||||||||||
For the year ended December 31, 2013, we recognized approximately 3% of our premium revenue in the form of “birth income” — a one-time payment for the delivery of a child — from the Medicaid programs in all of our state health plans except New Mexico. Such payments are recognized as revenue in the month the birth occurs. | |||||||||||||||||||||||||||||||||
Certain components of premium revenue are subject to accounting estimates. The components of premium revenue subject to estimation fall into two categories: | |||||||||||||||||||||||||||||||||
(1) Contractual provisions that may limit revenue based upon the costs incurred or the profits realized under a specific contract. | |||||||||||||||||||||||||||||||||
These are contractual provisions that require the health plan to return premiums to the extent that certain thresholds are not met. In some instances premiums are returned when medical costs fall below a certain percentage of gross premiums; or when administrative costs or profits exceed a certain percentage of gross premiums. In other instances, premiums are partially determined by the acuity of care provided to members (risk adjustment). To the extent that our expenses and profits change from the amounts previously reported (due to changes in estimates) our revenue earned for those periods will also change. In all of these instances our revenue is only subject to estimate due to the fact that the thresholds themselves contain elements (expense or profit) that are subject to estimate. While we have adequate experience and data to make sound estimates of our expenses or profits, changes to those estimates may be necessary, which in turn would lead to changes in our estimates of revenue. In general, a change in estimate relating to expense or profit would offset any related change in estimate to premium, resulting in no or small impact to net income. | |||||||||||||||||||||||||||||||||
Health Plan Medical Cost Floors (Minimums), and Administrative Cost and Profit Ceilings (Maximums): A portion of certain premiums received by our California, Florida, Illinois, New Mexico, and Washington health plans may be returned to the state if certain minimum amounts are not spent on defined medical care costs, or if administrative costs or profits exceed certain amounts. In Ohio, the state may levy sanctions on us if certain minimum amounts are not spent on defined medical care costs. In the aggregate, we recorded a liability under the terms of such contract provisions of $1.4 million and $0.3 million at December 31, 2013, and December 31, 2012, respectively. | |||||||||||||||||||||||||||||||||
Texas Health Plan Profit Sharing: Under our contract with the state of Texas, there is a profit-sharing agreement under which we pay a rebate to the state of Texas if our Texas health plan generates pretax income, as defined in the contract, above a certain specified percentage, as determined in accordance with a tiered rebate schedule. We are limited in the amount of administrative costs that we may deduct in calculating the rebate, if any. As a result of profits in excess of the amount we are allowed to fully retain, we had accrued an aggregate liability of $2.5 million and $3.2 million pursuant to our profit-sharing agreement with the state of Texas at December 31, 2013 and December 31, 2012, respectively. | |||||||||||||||||||||||||||||||||
Medicare Revenue Risk Adjustment: Based on member encounter data that we submit to CMS, our Medicare premiums are subject to retroactive adjustment for both member risk scores and member pharmacy cost experience for up to two years after the original year of service. This adjustment takes into account the acuity of each member’s medical needs relative to what was anticipated when premiums were originally set for that member. In the event that a member requires less acute medical care than was anticipated by the original premium amount, CMS may recover premium from us. In the event that a member requires more acute medical care than was anticipated by the original premium amount, CMS may pay us additional retroactive premium. A similar retroactive reconciliation is undertaken by CMS for our Medicare members’ pharmacy utilization. We estimate the amount of Medicare revenue that will ultimately be realized for the periods presented based on our knowledge of our members’ health care utilization patterns and CMS practices. Based on our knowledge of member health care utilization patterns and expenses we have recorded a net receivable of $20.8 million and $0.3 million for anticipated Medicare risk adjustment premiums at December 31, 2013 and December 31, 2012, respectively. | |||||||||||||||||||||||||||||||||
(2) Quality incentives that allow us to recognize incremental revenue if certain quality standards are met. | |||||||||||||||||||||||||||||||||
At our New Mexico, Ohio, Texas and Wisconsin health plans, incremental revenue ranging from 0.75% to 5.00% of health plan premiums is earned if certain performance measures are met. We estimate the amount of revenue that will ultimately be realized for the periods presented based on our experience and expertise in meeting the quality and administrative measures as well as our ongoing and current monitoring of our progress in meeting those measures. The amount of the revenue that we will realize under these contractual provisions is determinable based upon that experience. | |||||||||||||||||||||||||||||||||
Medical Care Costs | ' | ||||||||||||||||||||||||||||||||
Medical Care Costs | |||||||||||||||||||||||||||||||||
Expenses related to medical care services are captured in the following categories: | |||||||||||||||||||||||||||||||||
• | Fee-for-service: Nearly all hospital services and the majority of our primary care and physician specialist services are paid on a fee-for-service basis. Under all fee-for-service arrangements, we retain the financial responsibility for medical care provided. Expenses related to fee-for-service contracts are recorded in the period in which the related services are dispensed. The costs of drugs administered in a physician or hospital setting that are not billed through our pharmacy benefit manager are included in fee-for-service costs. | ||||||||||||||||||||||||||||||||
• | Capitation: Many of our primary care physicians and a small portion of our specialists and hospitals are paid on a capitated basis. Under capitation contracts, we typically pay a fixed PMPM payment to the provider without regard to the frequency, extent, or nature of the medical services actually furnished. Under capitated contracts, we remain liable for the provision of certain health care services. Capitation payments are fixed in advance of the periods covered and are not subject to significant accounting estimates. These payments are expensed in the period the providers are obligated to provide services. The financial risk for pharmacy services for a small portion of our membership is delegated to capitated providers. | ||||||||||||||||||||||||||||||||
• | Pharmacy: Pharmacy costs include all drug, injectibles, and immunization costs paid through our pharmacy benefit manager. As noted above, drugs and injectibles not paid through our pharmacy benefit manager are included in fee-for-service costs, except in those limited instances where we capitate drug and injectible costs. | ||||||||||||||||||||||||||||||||
• | Direct delivery: Costs associated with our operation and/or management of primary care clinics and hospital services in California, Florida, New Mexico, Virginia, and Washington. | ||||||||||||||||||||||||||||||||
• | Other: Other medical care costs include medically related administrative costs, certain provider incentive costs, reinsurance cost, and other health care expense. Medically related administrative costs include, for example, expenses relating to health education, quality assurance, case management, disease management, and 24-hour on-call nurses. Salary and benefit costs are a substantial portion of these expenses. For the years ended December 31, 2013, 2012, and 2011, medically related administrative costs were $153.0 million, $125.2 million, and $99.3 million, respectively. | ||||||||||||||||||||||||||||||||
The following table provides the details of our consolidated medical care costs from continuing operations for the periods indicated (dollars in thousands, except PMPM amounts): | |||||||||||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||||||||||
Amount | PMPM | % of | Amount | PMPM | % of | Amount | PMPM | % of | |||||||||||||||||||||||||
Total | Total | Total | |||||||||||||||||||||||||||||||
Fee-for-service | $ | 3,611,529 | $ | 160.43 | 67.1 | % | $ | 3,423,751 | $ | 161.67 | 68.6 | % | $ | 2,587,380 | $ | 136.72 | 70.6 | % | |||||||||||||||
Pharmacy | 935,204 | 41.54 | 17.4 | 835,830 | 39.47 | 16.7 | 418,019 | 22.09 | 11.4 | ||||||||||||||||||||||||
Capitation | 603,938 | 26.83 | 11.2 | 552,136 | 26.07 | 11.1 | 505,892 | 26.73 | 13.8 | ||||||||||||||||||||||||
Direct delivery | 48,288 | 2.14 | 0.9 | 33,920 | 1.6 | 0.7 | 29,683 | 1.57 | 0.8 | ||||||||||||||||||||||||
Other | 181,165 | 8.05 | 3.4 | 145,551 | 6.87 | 2.9 | 123,187 | 6.51 | 3.4 | ||||||||||||||||||||||||
Total | $ | 5,380,124 | $ | 238.99 | 100 | % | $ | 4,991,188 | $ | 235.68 | 100 | % | $ | 3,664,161 | $ | 193.62 | 100 | % | |||||||||||||||
The Missouri health plan's medical care costs, which are not included in the table above, amounted to $1.5 million, $105.6 million, and $195.8 million for the years ended December 31, 2013, 2012, and 2011, respectively. | |||||||||||||||||||||||||||||||||
Our medical care costs include amounts that have been paid by us through the reporting date, as well as estimated liabilities for medical care costs incurred but not paid by us as of the reporting date. Such medical care cost liabilities include, among other items, unpaid fee-for-service claims, capitation payments owed providers, unpaid pharmacy invoices, and various medically related administrative costs that have been incurred but not paid. We use judgment to determine the appropriate assumptions for determining the required estimates. | |||||||||||||||||||||||||||||||||
The most important element in estimating our medical care costs is our estimate for fee-for-service claims which have been incurred but not paid by us. These fee-for-service costs that have been incurred but have not been paid at the reporting date are collectively referred to as medical costs that are incurred but not paid (IBNP). Our IBNP claims reserve, as reported in our balance sheet, represents our best estimate of the total amount of claims we will ultimately pay with respect to claims that we have incurred as of the balance sheet date. We estimate our IBNP monthly using actuarial methods based on a number of factors. For further information, see Note 11, “Medical Claims and Benefits Payable.” | |||||||||||||||||||||||||||||||||
We report reinsurance premiums as medical care costs, while related reinsurance recoveries are reported as deductions from medical care costs. We limit our risk of catastrophic losses by maintaining high deductible reinsurance coverage. We do not consider this coverage to be material because the cost is not significant and the likelihood that coverage will apply is low. | |||||||||||||||||||||||||||||||||
Taxes Based on Premiums | ' | ||||||||||||||||||||||||||||||||
Taxes Based on Premiums | |||||||||||||||||||||||||||||||||
Certain of our health plans are assessed a tax based on premium revenue collected. The premium revenues we receive from these states include the premium tax assessment. We have reported these taxes on a gross basis, as premium tax revenue and as premium tax expense in the consolidated statements of income. Prior to 2013, premium tax revenue was included in premium revenue. The presentation change affected only premium revenue amounts previously reported, by reducing premium revenue for the amount now included in premium tax revenue. There is no effect on income from continuing operations, net income, or per-share amounts. This change was made to more clearly present the portion of premium revenue paid to us as a result of a related premium tax, and therefore not available to the general operations of our health plans. All prior periods presented have been adjusted to conform to this presentation. | |||||||||||||||||||||||||||||||||
Premium Deficiency Reserves on Loss Contracts | ' | ||||||||||||||||||||||||||||||||
Premium Deficiency Reserves on Loss Contracts | |||||||||||||||||||||||||||||||||
We assess the profitability of our contracts for providing medical care services to our members and identify those contracts where current operating results or forecasts indicate probable future losses. Anticipated future premiums are compared to anticipated medical care costs, including the cost of processing claims. If the anticipated future costs exceed the premiums, a loss contract accrual is recognized. | |||||||||||||||||||||||||||||||||
Service Revenue and Cost of Service Revenue - Molina Medicaid Solutions Segment | ' | ||||||||||||||||||||||||||||||||
Service Revenue and Cost of Service Revenue — Molina Medicaid Solutions Segment | |||||||||||||||||||||||||||||||||
The payments received by our Molina Medicaid Solutions segment under its state contracts are based on the performance of multiple services. The first of these is the design, development and implementation (DDI), of a MMIS. An additional service, following completion of DDI, is the operation of the MMIS under a business process outsourcing (BPO) arrangement. While providing BPO services (which include claims payment and eligibility processing) we also provide the state with other services including both hosting and support and maintenance. Our Molina Medicaid Solutions contracts may extend over a number of years, particularly in circumstances where we deliver extensive and complex DDI services, such as the initial design, development and implementation of a complete MMIS. We receive progress payments from the state during the performance of DDI services based upon the attainment of predetermined milestones. Following the completion of DDI, we generally receive a flat monthly payment for BPO services. | |||||||||||||||||||||||||||||||||
We have evaluated our Molina Medicaid Solutions contracts to determine if such arrangements include a software element. Based on this evaluation, we have concluded that these arrangements do not include a software element, and are therefore multiple-element service arrangements. | |||||||||||||||||||||||||||||||||
Additionally, we evaluate each required deliverable under our multiple-element service arrangements to determine whether it qualifies as a separate unit of accounting. Such evaluation is generally based on whether the deliverable has standalone value to the customer. If the deliverable has standalone value, the arrangement’s consideration that is fixed or determinable is then allocated to each separate unit of accounting based on the relative selling price of each deliverable. In general, the consideration allocated to each unit of accounting is recognized as the related goods or services are delivered, limited to the consideration that is not contingent. | |||||||||||||||||||||||||||||||||
We have concluded that the various service elements in our Molina Medicaid Solutions contracts represent a single unit of accounting due to the fact that DDI, which is the only service performed in advance of the other services (all other services are performed over an identical period), does not have standalone value because our DDI services are not sold separately by any vendor and the customer could not resell our DDI services. Further, we have no objective and reliable evidence of fair value for any of the individual elements in these contracts, and at no point in the contract will we have objective and reliable evidence of fair value for the undelivered elements in the contracts. We lack objective and reliable evidence of the fair value of the individual elements of our Molina Medicaid Solutions contracts for the following reasons: | |||||||||||||||||||||||||||||||||
• | Each contract calls for the provision of its own specific set of services. While all contracts support the system of record for state MMIS, the actual services we provide vary significantly between contracts; and | ||||||||||||||||||||||||||||||||
• | The nature of the MMIS installed varies significantly between our older contracts (proprietary mainframe systems) and our new contracts (commercial off-the-shelf technology solutions). | ||||||||||||||||||||||||||||||||
Because we have determined the services provided under our Molina Medicaid Solutions contracts represent a single unit of accounting, and because we are unable to determine a pattern of performance of services during the contract period, we recognize all revenue (both the DDI and BPO elements) associated with such contracts on a straight-line basis over the period during which BPO, hosting, and support and maintenance services are delivered. Therefore, absent any contingencies as discussed in the following paragraph, or contract extensions, we would recognize all revenue associated with those contracts over the initial contract period. When a contract is extended, we generally consider the extension to be a continuation of the single unit of accounting; therefore, the deferred revenue as of the extension date is recognized prospectively over the new remaining term of the contract. In cases where there is no DDI element associated with our contracts, BPO revenue is recognized on a monthly basis as specified in the applicable contract or contract extension. | |||||||||||||||||||||||||||||||||
Provisions specific to each contract may, however, lead us to modify this general principle. In those circumstances, the right of the state to refuse acceptance of services, as well as the related obligation to compensate us, may require us to delay recognition of all or part of our revenue until that contingency (the right of the state to refuse acceptance) has been removed. In those circumstances, we defer recognition of any contingent revenue (whether DDI, BPO services, hosting, and support and maintenance services) until the contingency has been removed. These types of contingency features are present in our Maine and Idaho contracts, for example. In those states, we deferred recognition of revenue until the contingencies were removed. | |||||||||||||||||||||||||||||||||
Costs associated with our Molina Medicaid Solutions contracts include software related costs and other costs. With respect to software related costs, we apply the guidance for internal-use software and capitalize external direct costs of materials and services consumed in developing or obtaining the software, and payroll and payroll-related costs associated with employees who are directly associated with and who devote time to the computer software project. With respect to all other direct costs, such costs are expensed as incurred, unless corresponding revenue is being deferred. If revenue is being deferred, direct costs relating to delivered service elements are deferred as well and are recognized on a straight-line basis over the period of revenue recognition, in a manner consistent with our recognition of revenue that has been deferred. Such direct costs can include: | |||||||||||||||||||||||||||||||||
• | Transaction processing costs; | ||||||||||||||||||||||||||||||||
• | Employee costs incurred in performing transaction services; | ||||||||||||||||||||||||||||||||
• | Vendor costs incurred in performing transaction services; | ||||||||||||||||||||||||||||||||
• | Costs incurred in performing required monitoring of and reporting on contract performance; | ||||||||||||||||||||||||||||||||
• | Costs incurred in maintaining and processing member and provider eligibility; and | ||||||||||||||||||||||||||||||||
• | Costs incurred in communicating with members and providers. | ||||||||||||||||||||||||||||||||
The recoverability of deferred contract costs associated with a particular contract is analyzed on a periodic basis using the undiscounted estimated cash flows of the whole contract over its remaining contract term. If such undiscounted cash flows are insufficient to recover the long-lived assets and deferred contract costs, the deferred contract costs are written down by the amount of the cash flow deficiency. If a cash flow deficiency remains after reducing the balance of the deferred contract costs to zero, any remaining long-lived assets are evaluated for impairment. Any such impairment recognized would equal the amount by which the carrying value of the long-lived assets exceeds the fair value of those assets. | |||||||||||||||||||||||||||||||||
Income Taxes | ' | ||||||||||||||||||||||||||||||||
Income Taxes | |||||||||||||||||||||||||||||||||
The provision for income taxes is determined using an estimated annual effective tax rate, which is generally greater than the U.S. federal statutory rate primarily because of state taxes and nondeductible compensation and other general and administrative expenses. The effective tax rate may be subject to fluctuations during the year as new information is obtained. Such information may affect the assumptions used to estimate the annual effective tax rate, including factors such as the mix of pretax earnings in the various tax jurisdictions in which we operate, valuation allowances against deferred tax assets, the recognition or derecognition of tax benefits related to uncertain tax positions, and changes in or the interpretation of tax laws in jurisdictions where we conduct business. We recognize deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of our assets and liabilities, along with net operating loss and tax credit carryovers. | |||||||||||||||||||||||||||||||||
Concentrations of Credit Risk | ' | ||||||||||||||||||||||||||||||||
Concentrations of Credit Risk | |||||||||||||||||||||||||||||||||
Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, investments, receivables, and restricted investments. We invest a substantial portion of our cash in the PFM Funds Prime Series — Institutional Class, and the PFM Funds Government Series. These funds represent a portfolio of highly liquid money market securities that are managed by PFM Asset Management LLC (PFM), a Virginia business trust registered as an open-end management investment fund. As of December 31, 2013, and 2012, our investments with PFM amounted to approximately $374 million and $428 million, respectively. Our investments and a portion of our cash equivalents are managed by professional portfolio managers operating under documented investment guidelines. No investment that is in a loss position can be sold by our managers without our prior approval. Our investments consist solely of investment grade debt securities with a maximum maturity of five years and an average duration of two years or less. Restricted investments are invested principally in certificates of deposit and U.S. treasury securities. Concentration of credit risk with respect to accounts receivable is limited due to payors consisting principally of the governments of each state in which our health plan subsidiaries operate. | |||||||||||||||||||||||||||||||||
Risks and Uncertainties | ' | ||||||||||||||||||||||||||||||||
Risks and Uncertainties | |||||||||||||||||||||||||||||||||
Our profitability depends in large part on our ability to accurately predict and effectively manage medical care costs. We continually review our medical costs in light of our underlying claims experience and revised actuarial data. However, several factors could adversely affect medical care costs. These factors, which include changes in health care practices, inflation, new technologies, major epidemics, natural disasters, and malpractice litigation, are beyond our control and may have an adverse effect on our ability to accurately predict and effectively control medical care costs. Costs in excess of those anticipated could have a material adverse effect on our financial condition, results of operations, or cash flows. | |||||||||||||||||||||||||||||||||
We operate health plans in 11 states, primarily as a direct contractor with the states, and in Los Angeles County, California, as a subcontractor to another health plan holding a direct contract with the state. We are therefore dependent upon a small number of contracts to support our revenue. The loss of any one of those contracts could have a material adverse effect on our financial position, results of operations, or cash flows. Our ability to arrange for the provision of medical services to our members is dependent upon our ability to develop and maintain adequate provider networks. Our inability to develop or maintain such networks might, in certain circumstances, have a material adverse effect on our financial position, results of operations, or cash flows. | |||||||||||||||||||||||||||||||||
Recent Accounting Pronouncements | ' | ||||||||||||||||||||||||||||||||
Recent Accounting Pronouncements | |||||||||||||||||||||||||||||||||
Health Care Federal Excise Tax. In July 2011, the Financial Accounting Standards Board (FASB) issued guidance related to accounting for the fees to be paid by health insurers to the federal government under the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (ACA). The ACA imposes an annual fee, or excise tax, on health insurers for each calendar year beginning on or after January 1, 2014. The excise tax will be imposed beginning in 2014 based on a company's share of the industry's net premiums written during the preceding calendar year. | |||||||||||||||||||||||||||||||||
The new guidance specifies that the liability for the excise tax should be estimated and recorded in full once the entity provides qualifying health insurance in the applicable calendar year in which the excise tax is payable, with a corresponding deferred cost that is amortized to expense using a straight-line method of allocation unless another method better allocates the excise tax over the calendar year that it is payable. The new guidance is effective for annual reporting periods beginning after December 31, 2013, when the excise tax initially becomes effective. As enacted, this health care federal excise tax is non-deductible for income tax purposes, and is anticipated to be significant. It is yet undetermined how this excise tax will be factored into the calculation of our premium rates, if at all. Accordingly, adoption of this guidance and the enactment of this excise tax as currently written is expected to have a material impact on our financial position, results of operations, and cash flows in future periods. We estimate that our portion of the excise tax in 2014 will be approximately $85 million. | |||||||||||||||||||||||||||||||||
Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants (AICPA), and the Securities and Exchange Commission (SEC), did not have, or are not believed by management to have, a material impact on our present or future consolidated financial statements. |
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||||||||||||||||||
Depreciation and amortization | ' | ||||||||||||||||||||||||||||||||
The following table presents all depreciation and amortization recorded in our consolidated statements of income, regardless of whether the item appears as depreciation and amortization, a reduction of revenue, or as cost of service revenue. | |||||||||||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||
Depreciation, and amortization of capitalized software, continuing operations | $ | 54,837 | $ | 42,938 | $ | 30,803 | |||||||||||||||||||||||||||
Amortization of intangible assets, continuing operations | 17,906 | 20,176 | 17,450 | ||||||||||||||||||||||||||||||
Depreciation and amortization, continuing operations | 72,743 | 63,114 | 48,253 | ||||||||||||||||||||||||||||||
Depreciation and amortization, discontinued operations | 2 | 590 | 2,437 | ||||||||||||||||||||||||||||||
Amortization recorded as reduction of service revenue | 2,914 | 1,571 | 6,822 | ||||||||||||||||||||||||||||||
Amortization of capitalized software recorded as cost of service revenue | 18,207 | 13,489 | 16,871 | ||||||||||||||||||||||||||||||
Total | $ | 93,866 | $ | 78,764 | $ | 74,383 | |||||||||||||||||||||||||||
Summarized premium revenue | ' | ||||||||||||||||||||||||||||||||
The following table summarizes premium revenue from continuing operations for the periods indicated: | |||||||||||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
California | $ | 749,755 | 12.1 | % | $ | 665,600 | 12 | % | $ | 567,677 | 13.5 | % | |||||||||||||||||||||
Florida | 264,998 | 4.3 | 228,832 | 4.1 | 203,904 | 4.8 | |||||||||||||||||||||||||||
Illinois | 8,121 | 0.1 | — | — | — | — | |||||||||||||||||||||||||||
Michigan | 676,000 | 11 | 646,551 | 11.7 | 623,394 | 14.8 | |||||||||||||||||||||||||||
New Mexico | 446,758 | 7.2 | 321,853 | 5.8 | 328,706 | 7.8 | |||||||||||||||||||||||||||
Ohio | 1,098,795 | 17.8 | 1,095,137 | 19.7 | 912,219 | 21.7 | |||||||||||||||||||||||||||
Texas | 1,291,001 | 20.9 | 1,233,621 | 22.2 | 402,178 | 9.5 | |||||||||||||||||||||||||||
Utah | 310,895 | 5 | 298,392 | 5.4 | 287,290 | 6.8 | |||||||||||||||||||||||||||
Washington | 1,168,405 | 18.9 | 974,712 | 17.6 | 808,458 | 19.2 | |||||||||||||||||||||||||||
Wisconsin | 143,465 | 2.3 | 70,678 | 1.3 | 69,552 | 1.7 | |||||||||||||||||||||||||||
Direct delivery | 20,977 | 0.4 | 8,745 | 0.2 | 8,115 | 0.2 | |||||||||||||||||||||||||||
$ | 6,179,170 | 100 | % | $ | 5,544,121 | 100 | % | $ | 4,211,493 | 100 | % | ||||||||||||||||||||||
Quality incentive premium revenue recognized | ' | ||||||||||||||||||||||||||||||||
The following table quantifies the quality incentive premium revenue recognized for the periods presented, including the amounts earned in the period presented and prior periods. Although the reasonably possible effects of a change in estimate related to quality incentive premium revenue as of December 31, 2013 are not known, we have no reason to believe that the adjustments to prior years noted below are not indicative of the potential future changes in our estimates as of December 31, 2013. | |||||||||||||||||||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||||||||||||||||||
Maximum | Amount of | Amount of | Total Quality | Total Premium Revenue | |||||||||||||||||||||||||||||
Available Quality | Current Year | Quality Incentive | Incentive | Recognized | |||||||||||||||||||||||||||||
Incentive | Quality Incentive | Premium Revenue | Premium Revenue | ||||||||||||||||||||||||||||||
Premium – | Premium Revenue | Recognized from | Recognized | ||||||||||||||||||||||||||||||
Current Year | Recognized | Prior Year | |||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||
New Mexico | $ | 3,113 | $ | 2,618 | $ | 154 | $ | 2,772 | $ | 446,758 | |||||||||||||||||||||||
Ohio | 12,093 | 3,465 | 606 | 4,071 | 1,098,795 | ||||||||||||||||||||||||||||
Texas | 43,688 | 37,053 | 5,995 | 43,048 | 1,291,001 | ||||||||||||||||||||||||||||
Wisconsin | 4,417 | 2,667 | 2,301 | 4,968 | 143,465 | ||||||||||||||||||||||||||||
$ | 63,311 | $ | 45,803 | $ | 9,056 | $ | 54,859 | $ | 2,980,019 | ||||||||||||||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||||||||||||
Maximum | Amount of | Amount of | Total Quality | Total Premium Revenue | |||||||||||||||||||||||||||||
Available Quality | Current Year | Quality Incentive | Incentive | Recognized | |||||||||||||||||||||||||||||
Incentive | Quality Incentive | Premium Revenue | Premium Revenue | ||||||||||||||||||||||||||||||
Premium – | Premium Revenue | Recognized from | Recognized | ||||||||||||||||||||||||||||||
Current Year | Recognized | Prior Year | |||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||
New Mexico | $ | 2,244 | $ | 1,889 | $ | 643 | $ | 2,532 | $ | 321,853 | |||||||||||||||||||||||
Ohio | 12,033 | 8,079 | 966 | 9,045 | 1,095,137 | ||||||||||||||||||||||||||||
Texas | 58,516 | 52,521 | — | 52,521 | 1,233,621 | ||||||||||||||||||||||||||||
Wisconsin | 1,771 | — | 593 | 593 | 70,678 | ||||||||||||||||||||||||||||
$ | 74,564 | $ | 62,489 | $ | 2,202 | $ | 64,691 | $ | 2,721,289 | ||||||||||||||||||||||||
Year Ended December 31, 2011 | |||||||||||||||||||||||||||||||||
Maximum | Amount of | Amount of | Total Quality | Total Premium Revenue | |||||||||||||||||||||||||||||
Available Quality | Current Year | Quality Incentive | Incentive | Recognized | |||||||||||||||||||||||||||||
Incentive | Quality Incentive | Premium Revenue | Premium Revenue | ||||||||||||||||||||||||||||||
Premium – | Premium Revenue | Recognized from | Recognized | ||||||||||||||||||||||||||||||
Current Year | Recognized | Prior Year | |||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||
New Mexico | $ | 2,271 | $ | 1,558 | $ | 378 | $ | 1,936 | $ | 328,706 | |||||||||||||||||||||||
Ohio | 10,212 | 8,363 | 3,501 | 11,864 | 912,219 | ||||||||||||||||||||||||||||
Texas | — | — | — | — | 402,178 | ||||||||||||||||||||||||||||
Wisconsin | 1,705 | 542 | — | 542 | 69,552 | ||||||||||||||||||||||||||||
$ | 14,188 | $ | 10,463 | $ | 3,879 | $ | 14,342 | $ | 1,712,655 | ||||||||||||||||||||||||
Consolidated medical care costs | ' | ||||||||||||||||||||||||||||||||
The following table provides the details of our consolidated medical care costs from continuing operations for the periods indicated (dollars in thousands, except PMPM amounts): | |||||||||||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||||||||||
Amount | PMPM | % of | Amount | PMPM | % of | Amount | PMPM | % of | |||||||||||||||||||||||||
Total | Total | Total | |||||||||||||||||||||||||||||||
Fee-for-service | $ | 3,611,529 | $ | 160.43 | 67.1 | % | $ | 3,423,751 | $ | 161.67 | 68.6 | % | $ | 2,587,380 | $ | 136.72 | 70.6 | % | |||||||||||||||
Pharmacy | 935,204 | 41.54 | 17.4 | 835,830 | 39.47 | 16.7 | 418,019 | 22.09 | 11.4 | ||||||||||||||||||||||||
Capitation | 603,938 | 26.83 | 11.2 | 552,136 | 26.07 | 11.1 | 505,892 | 26.73 | 13.8 | ||||||||||||||||||||||||
Direct delivery | 48,288 | 2.14 | 0.9 | 33,920 | 1.6 | 0.7 | 29,683 | 1.57 | 0.8 | ||||||||||||||||||||||||
Other | 181,165 | 8.05 | 3.4 | 145,551 | 6.87 | 2.9 | 123,187 | 6.51 | 3.4 | ||||||||||||||||||||||||
Total | $ | 5,380,124 | $ | 238.99 | 100 | % | $ | 4,991,188 | $ | 235.68 | 100 | % | $ | 3,664,161 | $ | 193.62 | 100 | % | |||||||||||||||
Net_Income_per_Share_Tables
Net Income per Share (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Summary of denominators for the computation of basic and diluted earnings per share | ' | ||||||||
The following table sets forth the calculation of the denominators used to compute basic and diluted net income per share: | |||||||||
December 31, | |||||||||
2013 | 2012 | 2011 | |||||||
(In thousands) | |||||||||
Shares outstanding at the beginning of the period | 46,762 | 45,815 | 45,463 | ||||||
Weighted-average number of shares repurchased | (1,445 | ) | (2 | ) | (160 | ) | |||
Weighted-average number of shares issued | 400 | 567 | 453 | ||||||
Denominator for basic net income per share | 45,717 | 46,380 | 45,756 | ||||||
Dilutive effect of employee stock options and stock grants (1) | 643 | 619 | 669 | ||||||
Dilutive effect of convertible senior notes (2) | 502 | — | — | ||||||
Denominator for diluted net income per share | 46,862 | 46,999 | 46,425 | ||||||
_______________________________ | |||||||||
-1 | Unvested restricted shares are included in the calculation of diluted net income per share when their grant date fair values are below the average fair value of our common shares for each of the periods presented. Options to purchase common shares are included in the calculation of diluted net income per share when their exercise prices are below the average fair value of our common shares for each of the periods presented. For the years ended December 31, 2013, 2012, and 2011 there were approximately 51,000, 87,000 and 137,000 anti-dilutive weighted options, respectively. For the years ended December 31, 2013 and 2011 anti-dilutive restricted shares were insignificant. For the year ended December 31, 2012 there were approximately 304,000 anti-dilutive restricted shares. | ||||||||
-2 | Potentially dilutive shares issuable pursuant to our 1.125% Warrants (defined in Note 12, "Long-Term Debt") were not included in the computation of diluted net income per share for the year ended December 31, 2013, because to do so would have been anti-dilutive. Potentially dilutive shares issuable pursuant to our 3.75% Notes (defined in Note 12, "Long-Term Debt") were not included in the computation of diluted net income per share for the years ended December 31, 2012, and 2011 because to do so would have been anti-dilutive. |
Business_Combinations_Tables
Business Combinations (Tables) | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||
Business Combinations [Abstract] | ' | |||||||||||||||||
Assets acquired and the weighted average useful life | ' | |||||||||||||||||
The following table presents assets acquired and the weighted average useful life for the major asset categories for the business combinations in 2013: | ||||||||||||||||||
Fair Value of Assets Acquired - Health Plans Segment | ||||||||||||||||||
Weighted average useful life | South Carolina | New Mexico | Florida | Total | ||||||||||||||
(Years) | (In thousands) | |||||||||||||||||
Membership conversion rights | 12 | $ | 21,800 | $ | — | $ | — | $ | 21,800 | |||||||||
Contract rights | 10.6 | — | 18,300 | — | 18,300 | |||||||||||||
Other finite-lived intangibles | 7.7 | 1,060 | — | 990 | 2,050 | |||||||||||||
Goodwill | Indefinite | 42,140 | 35,178 | 2,332 | 79,650 | |||||||||||||
$ | 65,000 | $ | 53,478 | $ | 3,322 | $ | 121,800 | |||||||||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||||||
Fair value of assets measured on recurring basis | ' | |||||||||||||||||||
Our financial instruments measured at fair value on a recurring basis at December 31, 2013, were as follows: | ||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Corporate debt securities | $ | 449,772 | $ | — | $ | 449,772 | $ | — | ||||||||||||
GSEs | 68,817 | 68,817 | — | — | ||||||||||||||||
Municipal securities | 113,330 | — | 113,330 | — | ||||||||||||||||
U.S. treasury notes | 37,376 | 37,376 | — | — | ||||||||||||||||
Certificates of deposit | 33,757 | — | 33,757 | — | ||||||||||||||||
Auction rate securities | 10,898 | — | — | 10,898 | ||||||||||||||||
1.125% Call Option derivative asset | 186,351 | — | — | 186,351 | ||||||||||||||||
Total assets measured at fair value on a recurring basis | $ | 900,301 | $ | 106,193 | $ | 596,859 | $ | 197,249 | ||||||||||||
Embedded cash conversion option derivative liability | $ | 186,239 | $ | — | $ | — | $ | 186,239 | ||||||||||||
Contingent consideration liabilities | 57,548 | — | — | 57,548 | ||||||||||||||||
Total liabilities measured at fair value on a recurring basis | $ | 243,787 | $ | — | $ | — | $ | 243,787 | ||||||||||||
Our financial instruments measured at fair value on a recurring basis at December 31, 2012, were as follows: | ||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Corporate debt securities | $ | 191,008 | $ | — | $ | 191,008 | $ | — | ||||||||||||
GSEs | 29,525 | 29,525 | — | — | ||||||||||||||||
Municipal securities | 75,848 | — | 75,848 | — | ||||||||||||||||
U.S. treasury notes | 35,740 | 35,740 | — | — | ||||||||||||||||
Certificates of deposit | 10,724 | — | 10,724 | — | ||||||||||||||||
Auction rate securities | 13,419 | — | — | 13,419 | ||||||||||||||||
Total assets measured at fair value on a recurring basis | $ | 356,264 | $ | 65,265 | $ | 277,580 | $ | 13,419 | ||||||||||||
Interest rate swap derivative liability | $ | 1,307 | $ | — | $ | 1,307 | $ | — | ||||||||||||
Fair value of assets measured on recurring basis using unobservable inputs | ' | |||||||||||||||||||
The following tables present activity relating to our assets (liabilities) measured at fair value on a recurring basis using significant unobservable inputs (Level 3): | ||||||||||||||||||||
Changes in Level 3 Instruments | ||||||||||||||||||||
Auction Rate Securities | Derivatives, Net | Contingent Consideration Liabilities | ||||||||||||||||||
Balance at December 31, 2011 | $ | 16,134 | $ | — | $ | — | ||||||||||||||
Net unrealized gains included in other comprehensive income | 1,635 | — | — | |||||||||||||||||
Auction rate securities settlements | (4,350 | ) | — | — | ||||||||||||||||
Balance at December 31, 2012 | 13,419 | — | — | |||||||||||||||||
Net unrealized gains included in other comprehensive income | 729 | — | — | |||||||||||||||||
Net unrealized losses included in other expenses | — | (3,810 | ) | — | ||||||||||||||||
Derivative issuance | — | (75,074 | ) | — | ||||||||||||||||
Auction rate securities settlements | (3,250 | ) | — | — | ||||||||||||||||
Derivative re-designation | — | 78,996 | — | |||||||||||||||||
Acquisitions | — | — | (57,548 | ) | ||||||||||||||||
Balance at December 31, 2013 | $ | 10,898 | $ | 112 | $ | (57,548 | ) | |||||||||||||
The amount of total unrealized gains for the period included in other comprehensive income attributable to the change in accumulated other comprehensive losses relating to assets still held at December 31, 2013 | $ | 541 | $ | — | $ | — | ||||||||||||||
The amount of total unrealized gains for the period included in other comprehensive income attributable to the change in accumulated other comprehensive losses relating to assets still held at December 31, 2012 | $ | 1,059 | $ | — | $ | — | ||||||||||||||
Fair Value Measurements, Recurring and Nonrecurring | ' | |||||||||||||||||||
The carrying amounts and estimated fair values of our long-term debt, as well as the applicable fair value hierarchy tier, are contained in the tables below. Our convertible senior notes are classified as Level 2 financial instruments. Fair value for these securities is determined using a market approach based on quoted prices for similar securities in active markets or quoted prices for identical securities in inactive markets. The credit facility was repaid and terminated in February 2013, and the term loan was repaid in June 2013. | ||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||
Carrying | Total | |||||||||||||||||||
Amount | Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
1.125% Notes | $ | 416,368 | $ | 572,627 | $ | — | $ | 572,627 | $ | — | ||||||||||
3.75% Notes | 181,872 | 219,491 | — | 219,491 | — | |||||||||||||||
$ | 598,240 | $ | 792,118 | $ | — | $ | 792,118 | $ | — | |||||||||||
31-Dec-12 | ||||||||||||||||||||
Carrying | Total | |||||||||||||||||||
Amount | Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
3.75% Notes | $ | 175,468 | $ | 208,460 | $ | — | $ | 208,460 | $ | — | ||||||||||
Term loan | 47,471 | 47,471 | — | — | 47,471 | |||||||||||||||
Credit facility | 40,000 | 40,000 | — | — | 40,000 | |||||||||||||||
$ | 262,939 | $ | 295,931 | $ | — | $ | 208,460 | $ | 87,471 | |||||||||||
Investments_Tables
Investments (Tables) | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ' | |||||||||||||||||||||
Investments | ' | |||||||||||||||||||||
The following tables summarize our investments as of the dates indicated: | ||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||
Amortized | Gross | Estimated | ||||||||||||||||||||
Unrealized | ||||||||||||||||||||||
Cost | Gains | Losses | Fair Value | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||
Corporate debt securities | $ | 450,162 | $ | 442 | $ | 832 | $ | 449,772 | ||||||||||||||
GSEs | 68,898 | 6 | 87 | 68,817 | ||||||||||||||||||
Municipal securities | 114,126 | 119 | 915 | 113,330 | ||||||||||||||||||
U.S. treasury notes | 37,360 | 44 | 28 | 37,376 | ||||||||||||||||||
Certificates of deposit | 33,756 | 2 | 1 | 33,757 | ||||||||||||||||||
Subtotal - current investments | 704,302 | 613 | 1,863 | 703,052 | ||||||||||||||||||
Auction rate securities | 11,400 | — | 502 | 10,898 | ||||||||||||||||||
$ | 715,702 | $ | 613 | $ | 2,365 | $ | 713,950 | |||||||||||||||
December 31, 2012 | ||||||||||||||||||||||
Amortized | Gross | Estimated | ||||||||||||||||||||
Unrealized | ||||||||||||||||||||||
Cost | Gains | Losses | Fair Value | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||
Corporate debt securities | $ | 190,545 | $ | 528 | $ | 65 | $ | 191,008 | ||||||||||||||
GSEs | 29,481 | 45 | 1 | 29,525 | ||||||||||||||||||
Municipal securities | 75,909 | 185 | 246 | 75,848 | ||||||||||||||||||
U.S. treasury notes | 35,700 | 42 | 2 | 35,740 | ||||||||||||||||||
Certificates of deposit | 10,715 | 9 | — | 10,724 | ||||||||||||||||||
Subtotal - current investments | 342,350 | 809 | 314 | 342,845 | ||||||||||||||||||
Auction rate securities | 14,650 | — | 1,231 | 13,419 | ||||||||||||||||||
$ | 357,000 | $ | 809 | $ | 1,545 | $ | 356,264 | |||||||||||||||
Contractual maturities of investments | ' | |||||||||||||||||||||
The contractual maturities of our investments as of December 31, 2013 are summarized below: | ||||||||||||||||||||||
Amortized | Estimated | |||||||||||||||||||||
Cost | Fair Value | |||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||
Due in one year or less | $ | 350,488 | $ | 350,605 | ||||||||||||||||||
Due one year through five years | 353,814 | 352,447 | ||||||||||||||||||||
Due after ten years | 11,400 | 10,898 | ||||||||||||||||||||
$ | 715,702 | $ | 713,950 | |||||||||||||||||||
Available-for-sale investments | ' | |||||||||||||||||||||
The following tables segregate those available-for-sale investments that have been in a continuous loss position for less than 12 months, and those that have been in a loss position for 12 months or more as of December 31, 2013. | ||||||||||||||||||||||
In a Continuous Loss Position | In a Continuous Loss Position | |||||||||||||||||||||
for Less than 12 Months | for 12 Months or More | |||||||||||||||||||||
Estimated | Unrealized | Total Number of Securities | Estimated | Unrealized | Total Number of Securities | |||||||||||||||||
Fair | Losses | Fair | Losses | |||||||||||||||||||
Value | Value | |||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||
Corporate debt securities | $ | 210,057 | $ | 802 | 91 | $ | 2,540 | $ | 30 | 3 | ||||||||||||
GSEs | 53,308 | 87 | 21 | — | — | — | ||||||||||||||||
Municipal securities | 30,715 | 398 | 49 | 31,091 | 517 | 39 | ||||||||||||||||
U.S. treasury notes | 12,037 | 28 | 11 | — | — | — | ||||||||||||||||
Certificates of deposit | 414 | 1 | 2 | — | — | — | ||||||||||||||||
Auction rate securities | — | — | — | 10,898 | 502 | 15 | ||||||||||||||||
$ | 306,531 | $ | 1,316 | 174 | $ | 44,529 | $ | 1,049 | 57 | |||||||||||||
The following table segregates those available-for-sale investments that have been in a continuous loss position for less than 12 months, and those that have been in a loss position for 12 months or more as of December 31, 2012. | ||||||||||||||||||||||
In a Continuous Loss Position | In a Continuous Loss Position | |||||||||||||||||||||
for Less than 12 Months | for 12 Months or More | |||||||||||||||||||||
Estimated | Unrealized | Total Number of Securities | Estimated | Unrealized | Total Number of Securities | |||||||||||||||||
Fair | Losses | Fair | Losses | |||||||||||||||||||
Value | Value | |||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||
Corporate debt securities | $ | 44,457 | $ | 65 | 23 | $ | — | $ | — | — | ||||||||||||
GSEs | 5,004 | 1 | 1 | — | — | — | ||||||||||||||||
Municipal securities | 35,223 | 246 | 43 | — | — | — | ||||||||||||||||
U.S. treasury notes | 4,511 | 2 | 5 | — | — | — | ||||||||||||||||
Auction rate securities | — | — | — | 13,419 | 1,231 | 21 | ||||||||||||||||
$ | 89,195 | $ | 314 | 72 | $ | 13,419 | $ | 1,231 | 21 | |||||||||||||
Receivables_Tables
Receivables (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Receivables [Abstract] | ' | |||||||
Summary of accounts receivable | ' | |||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
Health Plans segment: | ||||||||
California | $ | 148,654 | $ | 28,553 | ||||
Florida | 2,901 | 953 | ||||||
Illinois | 5,773 | — | ||||||
Michigan | 15,253 | 12,873 | ||||||
New Mexico | 17,056 | 9,059 | ||||||
Ohio | 43,969 | 40,980 | ||||||
Texas | 9,736 | 7,459 | ||||||
Utah | 10,953 | 3,359 | ||||||
Washington | 13,455 | 17,587 | ||||||
Wisconsin | 8,087 | 4,098 | ||||||
Direct delivery and other | 2,463 | 2,177 | ||||||
Total Health Plans segment | 278,300 | 127,098 | ||||||
Molina Medicaid Solutions segment | 20,635 | 22,584 | ||||||
$ | 298,935 | $ | 149,682 | |||||
Property_Equipment_and_Capital1
Property, Equipment, and Capitalized Software (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Summary of property and equipment | ' | |||||||
A summary of property, equipment, and capitalized software is as follows: | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
Land | $ | 15,764 | $ | 15,764 | ||||
Building and improvements | 165,670 | 124,163 | ||||||
Furniture and equipment | 131,478 | 97,865 | ||||||
Capitalized software | 187,105 | 154,708 | ||||||
500,017 | 392,500 | |||||||
Less: accumulated depreciation and amortization on building and improvements, furniture and equipment | (103,918 | ) | (84,156 | ) | ||||
Less: accumulated amortization for capitalized software | (104,016 | ) | (86,901 | ) | ||||
(207,934 | ) | (171,057 | ) | |||||
Property, equipment, and capitalized software, net | $ | 292,083 | $ | 221,443 | ||||
Summary of future minimum rentals on noncancelable leases | ' | |||||||
The future minimum rental income is as follows: | ||||||||
(In thousands) | ||||||||
2014 | $ | 4,192 | ||||||
2015 | 4,110 | |||||||
2016 | 3,542 | |||||||
2017 | 3,742 | |||||||
2018 | 3,581 | |||||||
Thereafter | 2,832 | |||||||
Total minimum future rentals | $ | 21,999 | ||||||
Goodwill_and_Intangible_Assets1
Goodwill and Intangible Assets (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||
Summary of identified intangible assets, by major class | ' | |||||||||||
Cost | Accumulated | Net | ||||||||||
Amortization | Balance | |||||||||||
(In thousands) | ||||||||||||
Intangible assets: | ||||||||||||
Contract rights and licenses | $ | 176,428 | $ | 92,789 | $ | 83,639 | ||||||
Customer relationships | 24,550 | 18,801 | 5,749 | |||||||||
Contract backlog | 23,600 | 19,624 | 3,976 | |||||||||
Provider networks | 13,370 | 7,863 | 5,507 | |||||||||
Balance at December 31, 2013 | $ | 237,948 | $ | 139,077 | $ | 98,871 | ||||||
Intangible assets: | ||||||||||||
Contract rights and licenses | $ | 135,932 | $ | 81,376 | $ | 54,556 | ||||||
Customer relationships | 24,550 | 12,513 | 12,037 | |||||||||
Contract backlog | 23,600 | 17,870 | 5,730 | |||||||||
Provider networks | 11,990 | 6,602 | 5,388 | |||||||||
Balance at December 31, 2012 | $ | 196,072 | $ | 118,361 | $ | 77,711 | ||||||
Changes in the carrying amount of goodwill | ' | |||||||||||
The following table presents the balances of goodwill as of December 31, 2013 and 2012: | ||||||||||||
31-Dec-12 | Acquisitions | 31-Dec-13 | ||||||||||
(In thousands) | ||||||||||||
Goodwill, gross | $ | 209,618 | $ | 79,650 | $ | 289,268 | ||||||
Accumulated impairment losses | (58,530 | ) | — | (58,530 | ) | |||||||
Goodwill, net | $ | 151,088 | $ | 79,650 | $ | 230,738 | ||||||
Restricted_Investments_Tables
Restricted Investments (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Investments, Debt and Equity Securities [Abstract] | ' | |||||||
Summary of restricted investments by health plan | ' | |||||||
The following table presents the balances of restricted investments: | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
California | $ | 373 | $ | 373 | ||||
Florida | 9,242 | 5,738 | ||||||
Illinois | 310 | 310 | ||||||
Michigan | 1,014 | 1,014 | ||||||
New Mexico | 24,622 | 15,915 | ||||||
Ohio | 9,080 | 9,082 | ||||||
Texas | 3,500 | 3,503 | ||||||
Utah | 3,301 | 3,126 | ||||||
Washington | 151 | 151 | ||||||
Other | 1,196 | 4,889 | ||||||
Total Health Plans segment | 52,789 | 44,101 | ||||||
Molina Medicaid Solutions segment | 10,304 | — | ||||||
$ | 63,093 | $ | 44,101 | |||||
Contractual maturities of our held-to-maturity restricted investments | ' | |||||||
The contractual maturities of our held-to-maturity restricted investments as of December 31, 2013 are summarized below. | ||||||||
Amortized | Estimated | |||||||
Cost | Fair Value | |||||||
(In thousands) | ||||||||
Due in one year or less | $ | 58,542 | $ | 58,543 | ||||
Due one year through five years | 4,551 | 4,555 | ||||||
$ | 63,093 | $ | 63,098 | |||||
Medical_Claims_and_Benefits_Pa1
Medical Claims and Benefits Payable (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Medical Claims and Benefits Payable [Abstract] | ' | |||||||||||
Components of the change in medical claims and benefits payable | ' | |||||||||||
The following table presents the components of the change in our medical claims and benefits payable from continuing and discontinued operations combined for the periods indicated. The amounts displayed for “Components of medical care costs related to: Prior periods” represent the amount by which our original estimate of claims and benefits payable at the beginning of the period were (more) or less than the actual amount of the liability based on information (principally the payment of claims) developed since that liability was first reported. | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(Dollars in thousands) | ||||||||||||
Balances at beginning of period | $ | 494,530 | $ | 402,476 | $ | 354,356 | ||||||
Components of medical care costs related to: | ||||||||||||
Current period | 5,434,443 | 5,136,055 | 3,911,803 | |||||||||
Prior periods | (52,779 | ) | (39,295 | ) | (51,809 | ) | ||||||
Total medical care costs | 5,381,664 | 5,096,760 | 3,859,994 | |||||||||
Change in non-risk provider payables | 111,267 | (7,004 | ) | 20,630 | ||||||||
Payments for medical care costs related to: | ||||||||||||
Current period | 4,932,195 | 4,689,395 | 3,564,030 | |||||||||
Prior periods | 385,479 | 308,307 | 268,474 | |||||||||
Total paid | 5,317,674 | 4,997,702 | 3,832,504 | |||||||||
Balances at end of period | $ | 669,787 | $ | 494,530 | $ | 402,476 | ||||||
Benefit from prior period as a percentage of: | ||||||||||||
Balance at beginning of period | 10.7 | % | 9.8 | % | 14.6 | % | ||||||
Premium revenue | 0.9 | % | 0.7 | % | 1.2 | % | ||||||
Medical care costs | 1 | % | 0.8 | % | 1.3 | % |
LongTerm_Debt_Tables
Long-Term Debt (Tables) | 12 Months Ended | |||||||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||||||||||||||||||
Maturities of long-term debt | ' | |||||||||||||||||||||||||||
As of December 31, 2013, maturities of long-term debt for the years ending December 31 are as follows (in thousands): | ||||||||||||||||||||||||||||
Total | 2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | ||||||||||||||||||||||
1.125% Notes | $ | 550,000 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 550,000 | ||||||||||||||
3.75% Notes | 187,000 | 187,000 | — | — | — | — | — | |||||||||||||||||||||
$ | 737,000 | $ | 187,000 | $ | — | $ | — | $ | — | $ | — | $ | 550,000 | |||||||||||||||
Long term debt | ' | |||||||||||||||||||||||||||
The principal amounts, unamortized discount and net carrying amounts of the convertible senior notes were as follows: | ||||||||||||||||||||||||||||
Principal Balance | Unamortized Discount | Net Carrying Amount | ||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||
December 31, 2013: | ||||||||||||||||||||||||||||
1.125% Notes | $ | 550,000 | $ | 133,632 | $ | 416,368 | ||||||||||||||||||||||
3.75% Notes | 187,000 | 5,128 | 181,872 | |||||||||||||||||||||||||
$ | 737,000 | $ | 138,760 | $ | 598,240 | |||||||||||||||||||||||
December 31, 2012: | ||||||||||||||||||||||||||||
3.75% Notes | $ | 187,000 | $ | 11,532 | $ | 175,468 | ||||||||||||||||||||||
Debt instruments interest cost recognized | ' | |||||||||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||
Interest cost recognized for the period relating to the: | ||||||||||||||||||||||||||||
Contractual interest coupon rate | $ | 12,427 | $ | 7,012 | $ | 7,012 | ||||||||||||||||||||||
Amortization of the discount | 22,103 | 5,942 | 5,512 | |||||||||||||||||||||||||
Total interest cost recognized | $ | 34,530 | $ | 12,954 | $ | 12,524 | ||||||||||||||||||||||
Derivative_Financial_Instrumen1
Derivative Financial Instruments (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | |||||||||
Fair Values of Derivative Financial Instruments | ' | |||||||||
The following table summarizes the fair values and the presentation of our derivative financial instruments (defined and discussed individually below) in the consolidated balance sheets: | ||||||||||
December 31, | ||||||||||
Balance Sheet Location | 2013 | 2012 | ||||||||
(In thousands) | ||||||||||
Derivative asset: | ||||||||||
1.125% Call Option | Non-current assets: Derivative asset | $ | 186,351 | $ | — | |||||
Derivative liability: | ||||||||||
Embedded cash conversion option | Non-current liabilities: Derivative liability | $ | 186,239 | $ | — | |||||
Interest rate swap | Non-current liabilities: Derivative liability | — | 1,307 | |||||||
$ | 186,239 | $ | 1,307 | |||||||
Derivative Instruments, Gain (Loss) | ' | |||||||||
The following table summarizes the gains (losses) recorded in the periods presented. There were no gains or losses for the year ended December 31, 2011. | ||||||||||
Year Ended December 31, | ||||||||||
2013 | 2012 | |||||||||
Derivative gains (losses): | ||||||||||
1.125% Call Option | $ | 37,020 | $ | — | ||||||
Embedded cash conversion option | (36,908 | ) | — | |||||||
1.125% Warrants | (3,923 | ) | — | |||||||
Interest rate swap | 433 | (1,307 | ) | |||||||
$ | (3,378 | ) | $ | (1,307 | ) |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||
Provision for income taxes | ' | |||||||||||
The provision for income taxes for continuing operations consisted of the following: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Current: | ||||||||||||
Federal | $ | 66,883 | $ | 23,019 | $ | 24,435 | ||||||
State | 581 | 1,254 | 1,587 | |||||||||
Total current | 67,464 | 24,273 | 26,022 | |||||||||
Deferred: | ||||||||||||
Federal | (25,498 | ) | (9,205 | ) | 16,905 | |||||||
State | (5,650 | ) | (4,555 | ) | (13 | ) | ||||||
Total deferred | (31,148 | ) | (13,760 | ) | 16,892 | |||||||
Total provision for income taxes | $ | 36,316 | $ | 10,513 | $ | 42,914 | ||||||
Effective income tax rate reconciliation to the statutory federal income tax rate | ' | |||||||||||
A reconciliation of the U.S. federal statutory income tax rate to the combined effective income tax rate for continuing operations is as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Statutory federal tax rate | 35 | % | 35 | % | 35 | % | ||||||
State income taxes, net of federal benefit | (0.5 | ) | (9.2 | ) | 0.9 | |||||||
Change in unrecognized tax benefits | (3.7 | ) | 0.7 | (0.3 | ) | |||||||
Nondeductible compensation | 9.6 | 6.2 | — | |||||||||
Nondeductible lobbying | 1.6 | 4.2 | 0.6 | |||||||||
Purchase accounting adjustment | — | — | (0.8 | ) | ||||||||
Nondeductible fair value of 1.125% Warrants | 2.4 | — | — | |||||||||
Change in fair value of contingent consideration liabilities | (0.3 | ) | 4.8 | — | ||||||||
Other | 0.7 | 3.3 | 0.3 | |||||||||
Effective tax rate | 44.8 | % | 45 | % | 35.7 | % | ||||||
Significant components of deferred tax assets and liabilities | ' | |||||||||||
Significant components of our deferred tax assets and liabilities as of December 31, 2013 and 2012 were as follows: | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
(In thousands) | ||||||||||||
Accrued expenses | $ | 19,545 | $ | 15,381 | ||||||||
Reserve liabilities | 1,712 | 2,936 | ||||||||||
State taxes | (1,323 | ) | (606 | ) | ||||||||
Other accrued medical costs | 2,540 | 2,518 | ||||||||||
Net operating losses | 27 | 27 | ||||||||||
Unrealized losses (gains) | 380 | (283 | ) | |||||||||
Unearned premiums | 10,543 | 15,675 | ||||||||||
Prepaid expenses | (5,354 | ) | (4,390 | ) | ||||||||
Basis in debt | (2,162 | ) | — | |||||||||
Deferred compensation | 2,087 | 1,611 | ||||||||||
Other, net | (928 | ) | 176 | |||||||||
Valuation allowance | (511 | ) | (602 | ) | ||||||||
Deferred tax asset, net of valuation allowance — current | 26,556 | 32,443 | ||||||||||
Reserve liabilities | 1,909 | 2,013 | ||||||||||
State tax credit carryover | 7,027 | 4,149 | ||||||||||
Net operating losses | 2,326 | 3,341 | ||||||||||
Unrealized losses | 286 | 563 | ||||||||||
Depreciation and amortization | (40,433 | ) | (44,198 | ) | ||||||||
Deferred compensation | 3,404 | 3,323 | ||||||||||
Lease financing obligation | 27,543 | — | ||||||||||
Debt basis | 466 | (5,410 | ) | |||||||||
Other, net | (24 | ) | 702 | |||||||||
Valuation allowance | (3,084 | ) | (2,383 | ) | ||||||||
Deferred tax liability, net of valuation allowance — long term | (580 | ) | (37,900 | ) | ||||||||
Net deferred income tax asset (liability) | $ | 25,976 | $ | (5,457 | ) | |||||||
Unrecognized tax benefits roll forward | ' | |||||||||||
The roll-forward of our unrecognized tax benefits is as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Gross unrecognized tax benefits at beginning of period | $ | (10,622 | ) | $ | (10,712 | ) | $ | (10,962 | ) | |||
Increases in tax positions for prior years | — | (441 | ) | (137 | ) | |||||||
Decreases in tax positions for prior years | 3,615 | 320 | — | |||||||||
Increases in tax positions for current year | (2,084 | ) | — | — | ||||||||
Decreases in tax positions for current year | 886 | — | — | |||||||||
Lapse in statute of limitations | 175 | 211 | 387 | |||||||||
Gross unrecognized tax benefits at end of period | $ | (8,030 | ) | $ | (10,622 | ) | $ | (10,712 | ) |
ShareBased_Compensation_Tables
Share-Based Compensation (Tables) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||||||||||||
Stock based compensation expense | ' | |||||||||||||||||||||||
The following table illustrates the components of our share-based compensation expense that are reported in general and administrative expenses in the consolidated statements of income: | ||||||||||||||||||||||||
Year Ended December 31, | ||||||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Pretax | Net-of-Tax | Pretax | Net-of-Tax | Pretax | Net-of-Tax | |||||||||||||||||||
Charges | Amount | Charges | Amount | Charges | Amount | |||||||||||||||||||
Restricted stock and performance awards | $ | 26,116 | $ | 22,489 | $ | 18,106 | $ | 12,943 | $ | 15,914 | $ | 9,946 | ||||||||||||
Employee stock purchase plan and stock options | 2,578 | 2,012 | 1,912 | 1,613 | 1,138 | 712 | ||||||||||||||||||
$ | 28,694 | $ | 24,501 | $ | 20,018 | $ | 14,556 | $ | 17,052 | $ | 10,658 | |||||||||||||
Restricted and performance stock activity | ' | |||||||||||||||||||||||
Restricted and performance stock activity for the year ended December 31, 2013 is summarized below: | ||||||||||||||||||||||||
Shares | Weighted | |||||||||||||||||||||||
Average | ||||||||||||||||||||||||
Grant Date | ||||||||||||||||||||||||
Fair Value | ||||||||||||||||||||||||
Unvested balance as of December 31, 2012 | 986,577 | $ | 23.74 | |||||||||||||||||||||
Granted - restricted stock | 587,706 | 32.15 | ||||||||||||||||||||||
Granted - performance stock | 456,174 | 30.8 | ||||||||||||||||||||||
Vested - restricted stock | (669,075 | ) | 25.45 | |||||||||||||||||||||
Forfeited | (61,530 | ) | 26.2 | |||||||||||||||||||||
Unvested balance as of December 31, 2013 | 1,299,852 | 29.03 | ||||||||||||||||||||||
Stock option activity | ' | |||||||||||||||||||||||
Stock option activity for the year ended December 31, 2013 is summarized below: | ||||||||||||||||||||||||
Shares | Weighted | Aggregate | Weighted | |||||||||||||||||||||
Average | Intrinsic | Average | ||||||||||||||||||||||
Exercise Price | Value | Remaining | ||||||||||||||||||||||
Contractual | ||||||||||||||||||||||||
term | ||||||||||||||||||||||||
(In thousands) | (Years) | |||||||||||||||||||||||
Stock options outstanding as of December 31, 2012 | 414,061 | $ | 22.39 | |||||||||||||||||||||
Granted | 45,000 | 33.02 | ||||||||||||||||||||||
Exercised | (79,540 | ) | 20.09 | |||||||||||||||||||||
Forfeited | (300 | ) | 17.63 | |||||||||||||||||||||
Stock options outstanding as of December 31, 2013 | 379,221 | 24.14 | $ | 4,024 | 3.4 | |||||||||||||||||||
Stock options exercisable and expected to vest as of December 31, 2013 | 379,221 | 24.14 | $ | 4,024 | 3.4 | |||||||||||||||||||
Exercisable as of December 31, 2013 | 324,221 | 22.58 | $ | 3,947 | 2.5 | |||||||||||||||||||
Summary of information about stock options outstanding and exercisable | ' | |||||||||||||||||||||||
The following is a summary of information about stock options outstanding and exercisable at December 31, 2013: | ||||||||||||||||||||||||
Options Outstanding | Options Exercisable | |||||||||||||||||||||||
Range of Exercise Prices | Number | Weighted- | Weighted- | Number | Weighted- | |||||||||||||||||||
Outstanding | Average | Average | Exercisable | Average | ||||||||||||||||||||
Remaining | Exercise | Exercise | ||||||||||||||||||||||
Contractual | Price | Price | ||||||||||||||||||||||
Life (Years) | ||||||||||||||||||||||||
$16.89 – $19.11 | 78,671 | 2 | $ | 19.05 | 78,671 | $ | 19.05 | |||||||||||||||||
$20.88 | 147,000 | 3.2 | 20.88 | 147,000 | 20.88 | |||||||||||||||||||
$22.86 – $34.82 | 153,550 | 4.4 | 29.87 | 98,550 | 27.93 | |||||||||||||||||||
379,221 | 324,221 | |||||||||||||||||||||||
Commitments_and_Contingencies_1
Commitments and Contingencies (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||
Summary of future minimum lease payments | ' | |||||||||||||||
Future minimum lease payments by year and in the aggregate under all operating leases and lease financing obligations consist of the following approximate amounts: | ||||||||||||||||
Lease Financing Obligations | Lease Financing Obligations - Related Party | Operating Leases | Total | |||||||||||||
(In thousands) | ||||||||||||||||
2014 | $ | 11,065 | $ | 3,330 | $ | 29,117 | $ | 43,512 | ||||||||
2015 | 11,397 | 6,880 | 23,196 | 41,473 | ||||||||||||
2016 | 11,739 | 7,138 | 15,890 | 34,767 | ||||||||||||
2017 | 12,091 | 7,405 | 14,434 | 33,930 | ||||||||||||
2018 | 12,454 | 7,683 | 12,832 | 32,969 | ||||||||||||
Thereafter | 333,275 | 52,538 | 13,569 | 399,382 | ||||||||||||
Total minimum lease payments | $ | 392,021 | $ | 84,974 | $ | 109,038 | $ | 586,033 | ||||||||
Segment_Information_Tables
Segment Information (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||
Operating segment information | ' | |||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Revenue from continuing operations: | ||||||||||||
Health Plans segment: | ||||||||||||
Premium revenue | $ | 6,179,170 | $ | 5,544,121 | $ | 4,211,493 | ||||||
Premium tax revenue | 172,017 | 158,991 | 154,589 | |||||||||
Investment income | 6,890 | 5,075 | 5,446 | |||||||||
Rental income and other revenue | 26,322 | 18,312 | 8,288 | |||||||||
Molina Medicaid Solutions segment: | ||||||||||||
Service revenue | 204,535 | 187,710 | 160,447 | |||||||||
$ | 6,588,934 | $ | 5,914,209 | $ | 4,540,263 | |||||||
Depreciation and amortization reported in the consolidated statements of cash flows: | ||||||||||||
Health Plans segment | $ | 67,446 | $ | 58,577 | $ | 45,734 | ||||||
Molina Medicaid Solutions segment | 26,420 | 20,187 | 28,649 | |||||||||
$ | 93,866 | $ | 78,764 | $ | 74,383 | |||||||
Operating income from continuing operations: | ||||||||||||
Health Plans segment | $ | 103,931 | $ | 17,366 | $ | 133,758 | ||||||
Molina Medicaid Solutions segment | 32,629 | 23,727 | 2,063 | |||||||||
Total operating income from continuing operations | 136,560 | 41,093 | 135,821 | |||||||||
Interest expense | 52,071 | 16,769 | 15,519 | |||||||||
Other expenses | 3,343 | 945 | — | |||||||||
Income from continuing operations before income taxes | $ | 81,146 | $ | 23,379 | $ | 120,302 | ||||||
As of December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Goodwill and intangible assets, net: | ||||||||||||
Health Plans segment | $ | 248,562 | $ | 139,710 | $ | 159,963 | ||||||
Molina Medicaid Solutions segment | 81,047 | 89,089 | 95,787 | |||||||||
$ | 329,609 | $ | 228,799 | $ | 255,750 | |||||||
Total assets: | ||||||||||||
Health Plans segment | $ | 2,809,439 | $ | 1,702,212 | $ | 1,429,283 | ||||||
Molina Medicaid Solutions segment | 193,498 | 232,610 | 222,863 | |||||||||
$ | 3,002,937 | $ | 1,934,822 | $ | 1,652,146 | |||||||
Quarterly_Results_of_Operation1
Quarterly Results of Operations (Unaudited) (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||||
Summary of quarterly results of operations | ' | |||||||||||||||
The following table summarizes quarterly unaudited results of operations for the years ended December 31, 2013 and 2012. We previously reported that our Medicaid managed care contract with the state of Missouri expired without renewal on June 30, 2012. Effective June 30, 2013 the transition obligations associated with that contract terminated. Therefore, we have reclassified the results relating to the Missouri health plan to discontinued operations for all periods presented. | ||||||||||||||||
For The Quarter Ended | ||||||||||||||||
March 31, | June 30, 2013(3) | 30-Sep-13 | December 31, | |||||||||||||
2013(1) | 2013 | |||||||||||||||
(In thousands, except per-share data) | ||||||||||||||||
Premium revenue (2) | $ | 1,497,433 | $ | 1,501,729 | $ | 1,584,656 | $ | 1,595,352 | ||||||||
Service revenue | 49,756 | 49,672 | 51,100 | 54,007 | ||||||||||||
Operating income (loss), Health Plans segment | 61,520 | 40,151 | 16,929 | (14,669 | ) | |||||||||||
Operating income, Molina Medicaid Solutions segment | 6,353 | 6,295 | 7,997 | 11,984 | ||||||||||||
Income (loss) from continuing operations | $ | 30,522 | $ | 15,796 | $ | 7,553 | $ | (9,041 | ) | |||||||
(Loss) income from discontinued operations | (607 | ) | 8,775 | 16 | (85 | ) | ||||||||||
Net income (loss) | $ | 29,915 | $ | 24,571 | $ | 7,569 | $ | (9,126 | ) | |||||||
Net income (loss) per share (4): | ||||||||||||||||
Basic | $ | 0.65 | $ | 0.54 | $ | 0.17 | $ | (0.20 | ) | |||||||
Diluted | $ | 0.64 | $ | 0.53 | $ | 0.16 | $ | (0.20 | ) | |||||||
For The Quarter Ended | ||||||||||||||||
March 31, | 30-Jun-12 | 30-Sep-12 | December 31, | |||||||||||||
2012(1) | 2012 | |||||||||||||||
(In thousands, except per-share data) | ||||||||||||||||
Premium revenue (2) | $ | 1,225,363 | $ | 1,392,774 | $ | 1,448,600 | $ | 1,477,384 | ||||||||
Service revenue | 42,205 | 41,724 | 48,422 | 55,359 | ||||||||||||
Operating income (loss), Health Plans segment | 27,903 | (56,072 | ) | (5,788 | ) | 51,323 | ||||||||||
Operating income, Molina Medicaid Solutions segment | 8,409 | 6,642 | 8,156 | 520 | ||||||||||||
Income (loss) from continuing operations | $ | 19,894 | $ | (33,057 | ) | $ | (165 | ) | $ | 26,194 | ||||||
(Loss) income from discontinued operations | (1,805 | ) | (4,249 | ) | 3,529 | (551 | ) | |||||||||
Net income (loss) | $ | 18,089 | $ | (37,306 | ) | $ | 3,364 | $ | 25,643 | |||||||
Net income (loss) per share (4): | ||||||||||||||||
Basic | $ | 0.39 | $ | (0.80 | ) | $ | 0.07 | $ | 0.55 | |||||||
Diluted | $ | 0.39 | $ | (0.80 | ) | $ | 0.07 | $ | 0.54 | |||||||
_______________________________ | ||||||||||||||||
-1 | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. | |||||||||||||||
-2 | Prior to the third quarter of 2013, premium tax revenue was included in premium revenue. The presentation change reduced premium revenue for the amount now reported as premium tax revenue. In connection with this presentation change, amounts differ from the amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue reported for the quarter ended March 31, 2013 and 2012 decreased $37.0 million and $43.4 million, respectively; premium revenue reported for the quarter ended June 30, 2013 and 2012 decreased $46.9 million and $39.6 million, respectively. | |||||||||||||||
-3 | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | |||||||||||||||
-4 | Potentially dilutive shares issuable pursuant to our 1.125% Warrants were not included in the computation of diluted net income per share for all quarters in 2013, because to do so would have been anti-dilutive. Potentially dilutive shares issuable pursuant to our 3.75% Notes were not included in the computation of diluted net income per share for the quarters ended March 31, 2013, June 30, 2013, and all quarters in 2012, because to do so would have been anti-dilutive. |
Condensed_Financial_Informatio1
Condensed Financial Information of Registrant (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | ' | |||||||||||
Components Of Condensed Balance Sheets | ' | |||||||||||
Condensed Balance Sheets | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
(Amounts in thousands, except per-share data) | ||||||||||||
ASSETS | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $ | 99,698 | $ | 39,068 | ||||||||
Investments | 262,665 | 2,015 | ||||||||||
Income tax refundable | 8,403 | 8,868 | ||||||||||
Deferred income taxes | 10,073 | 9,706 | ||||||||||
Due from affiliates | 35,928 | 55,382 | ||||||||||
Prepaid and other current assets | 28,387 | 19,164 | ||||||||||
Total current assets | 445,154 | 134,203 | ||||||||||
Property and equipment, net | 225,522 | 108,808 | ||||||||||
Goodwill and intangible assets, net | 68,902 | 52,302 | ||||||||||
Investments in subsidiaries | 992,998 | 768,765 | ||||||||||
Deferred income taxes | 17,245 | — | ||||||||||
Derivative asset | 186,351 | — | ||||||||||
Advances to related parties and other assets | 52,615 | 38,215 | ||||||||||
$ | 1,988,787 | $ | 1,102,293 | |||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||
Liabilities: | ||||||||||||
Accounts payable and accrued liabilities | $ | 109,388 | $ | 73,883 | ||||||||
Long-term debt | 784,862 | 215,468 | ||||||||||
Deferred income taxes | — | 17,122 | ||||||||||
Derivative liability | 186,239 | — | ||||||||||
Other long-term liabilities | 15,361 | 13,506 | ||||||||||
Total liabilities | 1,095,850 | 319,979 | ||||||||||
Stockholders' equity: | ||||||||||||
Common stock, $0.001 par value; 150,000 shares authorized; outstanding: | ||||||||||||
45,871 shares at December 31, 2013 and 46,762 shares at December 31, 2012 | 46 | 47 | ||||||||||
Preferred stock, $0.001 par value; 20,000 shares authorized, no shares issued and outstanding | — | — | ||||||||||
Paid-in capital | 340,848 | 285,524 | ||||||||||
Accumulated other comprehensive loss | (1,086 | ) | (457 | ) | ||||||||
Treasury stock, at cost; outstanding: 111 shares at December 31, 2012 | — | (3,000 | ) | |||||||||
Retained earnings | 553,129 | 500,200 | ||||||||||
Total stockholders' equity | 892,937 | 782,314 | ||||||||||
$ | 1,988,787 | $ | 1,102,293 | |||||||||
Components Of Condensed Statements Of Income | ' | |||||||||||
Condensed Statements of Income | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Revenue: | ||||||||||||
Management fees and other operating revenue | $ | 599,049 | $ | 406,981 | $ | 308,287 | ||||||
Investment income | 2,768 | 550 | 81 | |||||||||
Total revenue | 601,817 | 407,531 | 308,368 | |||||||||
Expenses: | ||||||||||||
Medical care costs | 37,862 | 33,102 | 31,672 | |||||||||
General and administrative expenses | 503,781 | 367,606 | 272,302 | |||||||||
Depreciation and amortization | 51,562 | 38,794 | 31,355 | |||||||||
Total expenses | 593,205 | 439,502 | 335,329 | |||||||||
Operating income (loss) | 8,612 | (31,971 | ) | (26,961 | ) | |||||||
Interest expense | 50,508 | 14,469 | 14,958 | |||||||||
Other expense | 3,811 | — | — | |||||||||
Loss before income taxes and equity in net income of subsidiaries | (45,707 | ) | (46,440 | ) | (41,919 | ) | ||||||
Income tax benefit | (15,455 | ) | (15,779 | ) | (14,826 | ) | ||||||
Net loss before equity in net income of subsidiaries | (30,252 | ) | (30,661 | ) | (27,093 | ) | ||||||
Equity in net income of subsidiaries | 83,181 | 40,451 | 47,911 | |||||||||
Net income | $ | 52,929 | $ | 9,790 | $ | 20,818 | ||||||
Condensed Statements of Comprehensive Income (Loss) | ' | |||||||||||
Condensed Statements of Comprehensive Income | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Net income | $ | 52,929 | $ | 9,790 | $ | 20,818 | ||||||
Other comprehensive income: | ||||||||||||
Gross unrealized investment (loss) gain | (1,015 | ) | 1,529 | 1,167 | ||||||||
Effect of income tax (benefit) expense | (386 | ) | 581 | 380 | ||||||||
Other comprehensive (loss) income, net of tax | (629 | ) | 948 | 787 | ||||||||
Comprehensive income | $ | 52,300 | $ | 10,738 | $ | 21,605 | ||||||
Components Of Condensed Statements Of Cash Flows | ' | |||||||||||
Condensed Statements of Cash Flows | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(In thousands) | ||||||||||||
Operating activities: | ||||||||||||
Net cash provided by operating activities | $ | 62,602 | $ | 20,611 | $ | 28,606 | ||||||
Investing activities: | ||||||||||||
Capital contributions to subsidiaries | (166,112 | ) | (100,221 | ) | (58,412 | ) | ||||||
Dividends received from subsidiaries | 24,429 | 101,800 | 86,284 | |||||||||
Purchases of investments | (362,927 | ) | (1,905 | ) | (2,020 | ) | ||||||
Sales and maturities of investments | 97,713 | 4,067 | 3,760 | |||||||||
Proceeds from sale of subsidiary, net of cash surrendered | — | 9,162 | — | |||||||||
Purchases of equipment | (76,873 | ) | (61,813 | ) | (30,930 | ) | ||||||
Changes in amounts due to/from affiliates | (5,888 | ) | 5,187 | (50,090 | ) | |||||||
Change in other assets and liabilities | (6,175 | ) | (1,342 | ) | (20,441 | ) | ||||||
Net cash used in investing activities | (495,833 | ) | (45,065 | ) | (71,849 | ) | ||||||
Financing activities: | ||||||||||||
Proceeds from issuance of 1.125% Notes, net of deferred issuance costs | 537,973 | — | — | |||||||||
Proceeds from sale-leaseback transactions | 158,694 | — | — | |||||||||
Purchase of 1.125% Notes call option | (149,331 | ) | — | — | ||||||||
Proceeds from issuance of warrants | 75,074 | — | — | |||||||||
Treasury stock repurchases | (52,662 | ) | (3,000 | ) | (7,000 | ) | ||||||
Principal payment on term loan of subsidiary | (46,963 | ) | — | — | ||||||||
Payment of credit facility fees | — | — | (1,125 | ) | ||||||||
Repayment of amount borrowed under credit facility | (40,000 | ) | (20,000 | ) | — | |||||||
Proceeds from exercise of stock options and employee stock plan purchases | 9,402 | 8,205 | 7,347 | |||||||||
Excess tax benefits from employee stock compensation | 1,674 | 3,667 | 1,651 | |||||||||
Amount borrowed under credit facility | — | 60,000 | — | |||||||||
Net cash provided by financing activities | 493,861 | 48,872 | 873 | |||||||||
Net increase (decrease) in cash and cash equivalents | 60,630 | 24,418 | (42,370 | ) | ||||||||
Cash and cash equivalents at beginning of year | 39,068 | 14,650 | 57,020 | |||||||||
Cash and cash equivalents at end of year | $ | 99,698 | $ | 39,068 | $ | 14,650 | ||||||
Basis_of_Presentation_Details
Basis of Presentation (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||||||||
Segment | |||||||||||||||||||
Basis Of Presentation [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Number of reportable segments | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ||||||||
Premium revenue | $1,595,352,000 | [1] | $1,584,656,000 | [1] | $1,501,729,000 | [1],[2] | $1,497,433,000 | [1],[3] | $1,477,384,000 | [1] | $1,448,600,000 | [1] | $1,392,774,000 | [1] | $1,225,363,000 | [1],[3] | $6,179,170,000 | $5,544,121,000 | $4,211,493,000 |
Health Care Organization, Premium Revenue | Louisiana Medicaid Management Information Systems | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Basis Of Presentation [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 40,500,000 | ' | ' | ||||||||
Concentration percentage | ' | ' | ' | ' | ' | ' | ' | ' | 19.80% | ' | ' | ||||||||
Estimated annual premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 40,000,000 | ' | ' | ||||||||
Florida | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Basis Of Presentation [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 264,998,000 | 228,832,000 | 203,904,000 | ||||||||
Florida | Florida Agency for Health Care Administration | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Basis Of Presentation [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Number of awarded contracts | 3 | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ||||||||
Number of members converted | 3,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Missouri | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Basis Of Presentation [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | 114,400,000 | 229,600,000 | ||||||||
Tax benefit from stock abandon | ' | ' | 9,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Health Plans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Basis Of Presentation [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Number of States Health Plans segments contracted with (states) | 11 | ' | ' | ' | ' | ' | ' | ' | 11 | ' | ' | ||||||||
Number of members eligible for the health care programs | 1,900,000 | ' | ' | ' | ' | ' | ' | ' | 1,900,000 | ' | ' | ||||||||
Minimum contract terms | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ||||||||
Maximum contract terms | ' | ' | ' | ' | ' | ' | ' | ' | '4 years | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | $6,179,170,000 | $5,544,121,000 | $4,211,493,000 | ||||||||
[1] | Prior to the third quarter of 2013, premium tax revenue was included in premium revenue. The presentation change reduced premium revenue for the amount now reported as premium tax revenue. In connection with this presentation change, amounts differ from the amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue reported for the quarter ended March 31, 2013 and 2012 decreased $37.0 million and $43.4 million, respectively; premium revenue reported for the quarter ended June 30, 2013 and 2012 decreased $46.9 million and $39.6 million, respectively. | ||||||||||||||||||
[2] | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | ||||||||||||||||||
[3] | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. |
Significant_Accounting_Policie3
Significant Accounting Policies - Depreciation and Amortization (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Accounting Policies [Abstract] | ' | ' | ' |
Depreciation, and amortization of capitalized software, continuing operations | $54,837 | $42,938 | $30,803 |
Amortization of intangible assets, continuing operations | 17,906 | 20,176 | 17,450 |
Depreciation and amortization, continuing operations | 72,743 | 63,114 | 48,253 |
Depreciation and amortization, discontinued operations | 2 | 590 | 2,437 |
Amortization recorded as reduction of service revenue | 2,914 | 1,571 | 6,822 |
Amortization of capitalized software recorded as cost of service revenue | 18,207 | 13,489 | 16,871 |
Total | $93,866 | $78,764 | $74,383 |
Significant_Accounting_Policie4
Significant Accounting Policies - Schedule of Premium Revenue (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | $1,595,352 | [1] | $1,584,656 | [1] | $1,501,729 | [1],[2] | $1,497,433 | [1],[3] | $1,477,384 | [1] | $1,448,600 | [1] | $1,392,774 | [1] | $1,225,363 | [1],[3] | $6,179,170 | $5,544,121 | $4,211,493 |
California | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 749,755 | 665,600 | 567,677 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 12.10% | 12.00% | 13.50% | ||||||||
Florida | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 264,998 | 228,832 | 203,904 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 4.30% | 4.10% | 4.80% | ||||||||
Illinois | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 8,121 | 0 | 0 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 0.10% | 0.00% | 0.00% | ||||||||
Michigan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 676,000 | 646,551 | 623,394 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 11.00% | 11.70% | 14.80% | ||||||||
New Mexico | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 446,758 | 321,853 | 328,706 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 7.20% | 5.80% | 7.80% | ||||||||
Ohio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 1,098,795 | 1,095,137 | 912,219 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 17.80% | 19.70% | 21.70% | ||||||||
Texas | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 1,291,001 | 1,233,621 | 402,178 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 20.90% | 22.20% | 9.50% | ||||||||
Utah | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 310,895 | 298,392 | 287,290 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | 5.40% | 6.80% | ||||||||
Washington | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 1,168,405 | 974,712 | 808,458 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 18.90% | 17.60% | 19.20% | ||||||||
Wisconsin | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 143,465 | 70,678 | 69,552 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 2.30% | 1.30% | 1.70% | ||||||||
Direct delivery and other | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 20,977 | 8,745 | 8,115 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 0.40% | 0.20% | 0.20% | ||||||||
Health Plans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summarized premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | $6,179,170 | $5,544,121 | $4,211,493 | ||||||||
Premium revenue percentage | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | 100.00% | 100.00% | ||||||||
[1] | Prior to the third quarter of 2013, premium tax revenue was included in premium revenue. The presentation change reduced premium revenue for the amount now reported as premium tax revenue. In connection with this presentation change, amounts differ from the amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue reported for the quarter ended March 31, 2013 and 2012 decreased $37.0 million and $43.4 million, respectively; premium revenue reported for the quarter ended June 30, 2013 and 2012 decreased $46.9 million and $39.6 million, respectively. | ||||||||||||||||||
[2] | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | ||||||||||||||||||
[3] | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. |
Significant_Accounting_Policie5
Significant Accounting Policies - Quality Incentive Premium Revenue (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | $1,595,352 | [1] | $1,584,656 | [1] | $1,501,729 | [1],[2] | $1,497,433 | [1],[3] | $1,477,384 | [1] | $1,448,600 | [1] | $1,392,774 | [1] | $1,225,363 | [1],[3] | $6,179,170 | $5,544,121 | $4,211,493 |
New Mexico | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Maximum Available Quality Incentive Premium-Current Year | ' | ' | ' | ' | ' | ' | ' | ' | 3,113 | 2,244 | 2,271 | ||||||||
Amount of Current Year Quality Incentive Premium Revenue Recognized | ' | ' | ' | ' | ' | ' | ' | ' | 2,618 | 1,889 | 1,558 | ||||||||
Amount of Quality Incentive Premium Revenue Recognized from Prior Year | ' | ' | ' | ' | ' | ' | ' | ' | 154 | 643 | 378 | ||||||||
Total Quality Incentive Premium Revenue Recognized | ' | ' | ' | ' | ' | ' | ' | ' | 2,772 | 2,532 | 1,936 | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 446,758 | 321,853 | 328,706 | ||||||||
Ohio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Maximum Available Quality Incentive Premium-Current Year | ' | ' | ' | ' | ' | ' | ' | ' | 12,093 | 12,033 | 10,212 | ||||||||
Amount of Current Year Quality Incentive Premium Revenue Recognized | ' | ' | ' | ' | ' | ' | ' | ' | 3,465 | 8,079 | 8,363 | ||||||||
Amount of Quality Incentive Premium Revenue Recognized from Prior Year | ' | ' | ' | ' | ' | ' | ' | ' | 606 | 966 | 3,501 | ||||||||
Total Quality Incentive Premium Revenue Recognized | ' | ' | ' | ' | ' | ' | ' | ' | 4,071 | 9,045 | 11,864 | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 1,098,795 | 1,095,137 | 912,219 | ||||||||
Texas | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Maximum Available Quality Incentive Premium-Current Year | ' | ' | ' | ' | ' | ' | ' | ' | 43,688 | 58,516 | 0 | ||||||||
Amount of Current Year Quality Incentive Premium Revenue Recognized | ' | ' | ' | ' | ' | ' | ' | ' | 37,053 | 52,521 | 0 | ||||||||
Amount of Quality Incentive Premium Revenue Recognized from Prior Year | ' | ' | ' | ' | ' | ' | ' | ' | 5,995 | 0 | 0 | ||||||||
Total Quality Incentive Premium Revenue Recognized | ' | ' | ' | ' | ' | ' | ' | ' | 43,048 | 52,521 | 0 | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 1,291,001 | 1,233,621 | 402,178 | ||||||||
Wisconsin | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Maximum Available Quality Incentive Premium-Current Year | ' | ' | ' | ' | ' | ' | ' | ' | 4,417 | 1,771 | 1,705 | ||||||||
Amount of Current Year Quality Incentive Premium Revenue Recognized | ' | ' | ' | ' | ' | ' | ' | ' | 2,667 | 0 | 542 | ||||||||
Amount of Quality Incentive Premium Revenue Recognized from Prior Year | ' | ' | ' | ' | ' | ' | ' | ' | 2,301 | 593 | 0 | ||||||||
Total Quality Incentive Premium Revenue Recognized | ' | ' | ' | ' | ' | ' | ' | ' | 4,968 | 593 | 542 | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 143,465 | 70,678 | 69,552 | ||||||||
New Mexico, Ohio, Texas, Wisconsin | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Schedule of Premium Revenue by Health Plan Type [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Maximum Available Quality Incentive Premium-Current Year | ' | ' | ' | ' | ' | ' | ' | ' | 63,311 | 74,564 | 14,188 | ||||||||
Amount of Current Year Quality Incentive Premium Revenue Recognized | ' | ' | ' | ' | ' | ' | ' | ' | 45,803 | 62,489 | 10,463 | ||||||||
Amount of Quality Incentive Premium Revenue Recognized from Prior Year | ' | ' | ' | ' | ' | ' | ' | ' | 9,056 | 2,202 | 3,879 | ||||||||
Total Quality Incentive Premium Revenue Recognized | ' | ' | ' | ' | ' | ' | ' | ' | 54,859 | 64,691 | 14,342 | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | $2,980,019 | $2,721,289 | $1,712,655 | ||||||||
[1] | Prior to the third quarter of 2013, premium tax revenue was included in premium revenue. The presentation change reduced premium revenue for the amount now reported as premium tax revenue. In connection with this presentation change, amounts differ from the amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue reported for the quarter ended March 31, 2013 and 2012 decreased $37.0 million and $43.4 million, respectively; premium revenue reported for the quarter ended June 30, 2013 and 2012 decreased $46.9 million and $39.6 million, respectively. | ||||||||||||||||||
[2] | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | ||||||||||||||||||
[3] | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. |
Significant_Accounting_Policie6
Significant Accounting Policies - Consolidated Medical Care Costs (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Medical Care Costs | ' | ' | ' |
Fee-for-service | $3,611,529 | $3,423,751 | $2,587,380 |
Pharmacy | 935,204 | 835,830 | 418,019 |
Capitation | 603,938 | 552,136 | 505,892 |
Direct delivery | 48,288 | 33,920 | 29,683 |
Other | 181,165 | 145,551 | 123,187 |
Total | $5,380,124 | $4,991,188 | $3,664,161 |
Medical Care Costs, PMPM | ' | ' | ' |
Fee-for-service | 160.43 | 161.67 | 136.72 |
Pharmacy | 41.54 | 39.47 | 22.09 |
Capitation | 26.83 | 26.07 | 26.73 |
Direct delivery | 2.14 | 1.6 | 1.57 |
Other | 8.05 | 6.87 | 6.51 |
Total | 238.99 | 235.68 | 193.62 |
Medical Care Costs, Percentage | ' | ' | ' |
Percentage of total in Fee for service | 67.10% | 68.60% | 70.60% |
Percentage of total in pharmacy | 17.40% | 16.70% | 11.40% |
Percentage of total in capitation | 11.20% | 11.10% | 13.80% |
Percent of total in direct delivery | 0.90% | 0.70% | 0.80% |
Percentage of total in other | 3.40% | 2.90% | 3.40% |
Percentage of total | 100.00% | 100.00% | 100.00% |
Significant_Accounting_Policie7
Significant Accounting Policies (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
State | ||||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Maturity of cash and cash equivalents | ' | 'three months or less | ' | ' |
Impairment of goodwill and intangible assets | $64,575,000 | $0 | $0 | $64,575,000 |
Impairment of finite-lived intangible assets | 6,100,000 | 0 | 0 | ' |
Goodwill impairment charges | 58,500,000 | 0 | 0 | ' |
Percentage of premium recorded as fixed amount per member per month | ' | 97.00% | ' | ' |
Percentage of premium revenue in the form of birth income | ' | 3.00% | ' | ' |
Maximum period for member risk scores and member pharmacy cost experience after original year of service | ' | '2 years | ' | ' |
Anticipated Medicare risk adjustment premiums | ' | 20,800,000 | 300,000 | ' |
Medical administrative costs | ' | 153,000,000 | 125,200,000 | 99,300,000 |
Missouri health plan's medical care costs | ' | 5,380,124,000 | 4,991,188,000 | 3,664,161,000 |
Concentration of credit risk | ' | 374,000,000 | 428,000,000 | ' |
Health plans in number of states | ' | 11 | ' | ' |
Estimated assessment fees in 2014 | ' | 85,000,000 | ' | ' |
Furniture and equipment | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Useful life of property plant and equipment | ' | '7 years | ' | ' |
Software | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Useful life of property plant and equipment | ' | '3 years | ' | ' |
Minimum | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Weighted average amortization period | ' | '1 year | ' | ' |
Minimum | Furniture and equipment | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Useful life of property plant and equipment | ' | '3 years | ' | ' |
Minimum | Leasehold Improvements | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Useful life of property plant and equipment | ' | '5 years | ' | ' |
Minimum | Building and improvements | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Useful life of property plant and equipment | ' | '31 years 6 months | ' | ' |
Minimum | Contract Backlog | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Weighted average amortization period | ' | '1 year | ' | ' |
Minimum | Customer relationships | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Weighted average amortization period | ' | '4 years | ' | ' |
Maximum | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Final maturities of investments (in years) | ' | '5 years | ' | ' |
Average maturity of investments (in years) | ' | '2 years | ' | ' |
Weighted average amortization period | ' | '15 years | ' | ' |
Maximum | Leasehold Improvements | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Useful life of property plant and equipment | ' | '10 years | ' | ' |
Maximum | Building and improvements | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Useful life of property plant and equipment | ' | '40 years | ' | ' |
Maximum | Contract Backlog | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Weighted average amortization period | ' | '6 years | ' | ' |
Maximum | Customer relationships | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Weighted average amortization period | ' | '9 years | ' | ' |
New Mexico, Ohio, Texas, Wisconsin | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Percentage of incremental revenue earned maximum | ' | 0.75% | ' | ' |
Percentage of additional incremental revenue earned | ' | 5.00% | ' | ' |
California | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Liability recorded related to profit sharing agreement | ' | 1,400,000 | 300,000 | ' |
Texas | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Liability recorded related to profit sharing agreement | ' | 2,500,000 | 3,200,000 | ' |
Missouri | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Missouri health plan's medical care costs | ' | $1,500,000 | $105,600,000 | $195,800,000 |
Net_Income_per_Share_Computati
Net Income per Share - Computation of Basic and Diluted EPS (Details) | 12 Months Ended | ||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |||
Summary of denominators for the computation of basic and diluted earnings per share | ' | ' | ' | ' | |||
Shares outstanding at the beginning of the period | ' | 46,762 | 45,815 | 45,463 | |||
Weighted-average number of shares issued | -1,445 | -2 | -160 | ' | |||
Weighted-average number of shares repurchased | 400 | 567 | 453 | ' | |||
Denominator for basic net income per share | 45,717 | 46,380 | 45,756 | ' | |||
Dilutive effect of employee stock options and stock grants (1) | 643 | [1] | 619 | [1] | 669 | [1] | ' |
Dilutive effect of convertible senior notes (2) | 502 | [2] | 0 | [2] | 0 | [2] | ' |
Denominator for diluted net income per share | 46,862 | 46,999 | 46,425 | ' | |||
[1] | Unvested restricted shares are included in the calculation of diluted net income per share when their grant date fair values are below the average fair value of our common shares for each of the periods presented. Options to purchase common shares are included in the calculation of diluted net income per share when their exercise prices are below the average fair value of our common shares for each of the periods presented. For the years ended December 31, 2013, 2012, and 2011 there were approximately 51,000, 87,000 and 137,000 anti-dilutive weighted options, respectively. For the years ended December 31, 2013 and 2011 anti-dilutive restricted shares were insignificant. For the year ended December 31, 2012 there were approximately 304,000 anti-dilutive restricted shares. | ||||||
[2] | Potentially dilutive shares issuable pursuant to our 1.125% Warrants (defined in Note 12, "Long-Term Debt") were not included in the computation of diluted net income per share for the year ended December 31, 2013, because to do so would have been anti-dilutive. Potentially dilutive shares issuable pursuant to our 3.75% Notes (defined in Note 12, "Long-Term Debt") were not included in the computation of diluted net income per share for the years ended December 31, 2012, and 2011 because to do so would have been anti-dilutive. |
Net_Income_per_Share_Details
Net Income per Share (Details) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Stock options | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Antidilutive Securities | 51 | 87 | 137 |
Restricted Stock | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Antidilutive Securities | ' | 304 | ' |
Business_Combinations_Details
Business Combinations (Details) (USD $) | 12 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | 1 Months Ended | ||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 07, 2011 | Jul. 26, 2013 | Dec. 31, 2013 | Jul. 26, 2013 | Dec. 31, 2013 | Aug. 01, 2013 | Dec. 31, 2013 | Aug. 01, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Jan. 31, 2014 | Dec. 07, 2011 | Dec. 31, 2011 | Dec. 07, 2011 | |
Molina Center | Molina Center | South Carolina | South Carolina | South Carolina | South Carolina | New Mexico | New Mexico | New Mexico | New Mexico | Florida | Subsequent Event | Building | Office Building | Land | ||||
sqft | Community Healthy Solutions of America, Inc. | Community Healthy Solutions of America, Inc. | Number of Member Conversion | Number of Member Conversion | Lovelace Community Health Plan | Lovelace Community Health Plan | Number of Member Conversion | Number of Member Conversion | Statewide Medicaid Managed Care Long-Term Care Program | South Carolina | Molina Center | property | Molina Center | |||||
Community Healthy Solutions of America, Inc. | Community Healthy Solutions of America, Inc. | member | Lovelace Community Health Plan | Lovelace Community Health Plan | Community Healthy Solutions of America, Inc. | sqft | acre | |||||||||||
member | ||||||||||||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of members converted | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 137,000 | ' | ' | ' |
Estimated final purchase price | ' | ' | ' | ' | ' | $63,000,000 | ' | ' | ' | $53,000,000 | ' | ' | ' | $3,300,000 | ' | ' | ' | ' |
Payments made in business combinations | 61,521,000 | 0 | 84,253,000 | ' | ' | 7,500,000 | ' | ' | ' | 51,000,000 | ' | ' | ' | ' | 38,100,000 | ' | ' | ' |
Initial contingent consideration liability recorded | ' | ' | ' | ' | ' | ' | ' | 57,500,000 | ' | ' | ' | 6,000,000 | ' | ' | ' | ' | ' | ' |
Estimated lower range of remaining purchase price payable | ' | ' | ' | ' | ' | ' | ' | ' | 46,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated higher range of remaining purchase price payable | ' | ' | ' | ' | ' | ' | ' | ' | 59,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in number of members | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 80,000 | ' | ' | ' | ' | ' | ' | ' |
Estimated fair value of contingent consideration liability | ' | ' | ' | ' | ' | ' | ' | ' | 55,400,000 | ' | ' | 2,500,000 | 2,200,000 | ' | ' | ' | ' | ' |
Change in fair value of contingent consideration liabilities | 2,400,000 | 0 | 0 | ' | ' | ' | ' | ' | 2,100,000 | ' | ' | ' | 300,000 | ' | ' | ' | ' | ' |
Number of conjoined fourteen-story office towers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' |
Final purchase price | ' | ' | ' | 81,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Area of real estate property | ' | ' | ' | ' | 155,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 460,000 | ' | 5 |
Future Amortization Expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 20,400,000 | ' | ' | ' | ' | ' | 1,900,000 | ' | ' | ' | 1,800,000 | ' | ' | ' | ' | ' | ' | ' |
2015 | 14,700,000 | ' | ' | ' | ' | ' | 1,900,000 | ' | ' | ' | 1,800,000 | ' | ' | ' | ' | ' | ' | ' |
2016 | 12,700,000 | ' | ' | ' | ' | ' | 1,900,000 | ' | ' | ' | 1,800,000 | ' | ' | ' | ' | ' | ' | ' |
2017 | 12,400,000 | ' | ' | ' | ' | ' | 1,900,000 | ' | ' | ' | 1,800,000 | ' | ' | ' | ' | ' | ' | ' |
2018 | $12,100,000 | ' | ' | ' | ' | ' | $1,900,000 | ' | ' | ' | $1,800,000 | ' | ' | ' | ' | ' | ' | ' |
Business_Combinations_FiniteLi
Business Combinations Finite-Lived Intangible Assets Acquired (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | 2013 Business Acquisitions | Membership conversion rights | Membership conversion rights | Contract rights | Contract rights | Other finite-lived intangibles | Other finite-lived intangibles | South Carolina | South Carolina | South Carolina | South Carolina | New Mexico | New Mexico | New Mexico | New Mexico | Florida | Florida | Florida | Florida | ||
2013 Business Acquisitions | 2013 Business Acquisitions | 2013 Business Acquisitions | Community Healthy Solutions of America, Inc. | Membership conversion rights | Contract rights | Other finite-lived intangibles | Lovelace Community Health Plan | Membership conversion rights | Contract rights | Other finite-lived intangibles | Statewide Medicaid Managed Care Long-Term Care Program | Membership conversion rights | Contract rights | Other finite-lived intangibles | |||||||
Community Healthy Solutions of America, Inc. | Community Healthy Solutions of America, Inc. | Community Healthy Solutions of America, Inc. | Lovelace Community Health Plan | Lovelace Community Health Plan | Lovelace Community Health Plan | Statewide Medicaid Managed Care Long-Term Care Program | Statewide Medicaid Managed Care Long-Term Care Program | Statewide Medicaid Managed Care Long-Term Care Program | |||||||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average useful life | ' | ' | ' | '12 years 0 months | ' | '10 years 7 months | ' | '7 years 8 months 12 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of finite-lived intangible assets acquired | ' | ' | ' | ' | $21,800 | ' | $18,300 | ' | $2,050 | ' | $21,800 | $0 | $1,060 | ' | $0 | $18,300 | $0 | ' | $0 | $0 | $990 |
Goodwill | 230,738 | 151,088 | 79,650 | ' | ' | ' | ' | ' | ' | 42,140 | ' | ' | ' | 35,178 | ' | ' | ' | 2,332 | ' | ' | ' |
Fair value of assets acquired | ' | ' | $121,800 | ' | ' | ' | ' | ' | ' | $65,000 | ' | ' | ' | $53,478 | ' | ' | ' | $3,322 | ' | ' | ' |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) | Dec. 31, 2013 | Feb. 15, 2013 |
Auction Rate Securities | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Participants in valuation data pool | 10,000 | ' |
Minimum | Level 3 | Fair Value, Measurements, Recurring | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Expected members to be converted | 120,000 | ' |
Maximum | Level 3 | Fair Value, Measurements, Recurring | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Expected members to be converted | 140,000 | ' |
1.125% Cash Convertible Senior Notes due 2020 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Percentage of contractual interest rate | 1.13% | 1.13% |
Fair_Value_Measurements_Financ
Fair Value Measurements Financial Instruments on a Recurring Basis (Details) (Fair Value, Measurements, Recurring, USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | $900,301 | $356,264 |
Embedded cash conversion option derivative liability | 186,239 | 1,307 |
Contingent consideration liabilities | 57,548 | ' |
Total liabilities measured at fair value on a recurring basis | 243,787 | ' |
Corporate Debt Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 449,772 | 191,008 |
GSEs | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 68,817 | 29,525 |
Municipal Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 113,330 | 75,848 |
US Treasury Notes Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 37,376 | 35,740 |
Certificates of Deposit | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 33,757 | 10,724 |
Auction Rate Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 10,898 | 13,419 |
1.125% Call Option Derivative Asset | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 186,351 | ' |
Level 1 | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 106,193 | 65,265 |
Embedded cash conversion option derivative liability | 0 | 0 |
Contingent consideration liabilities | 0 | ' |
Total liabilities measured at fair value on a recurring basis | 0 | ' |
Level 1 | Corporate Debt Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 1 | GSEs | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 68,817 | 29,525 |
Level 1 | Municipal Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 1 | US Treasury Notes Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 37,376 | 35,740 |
Level 1 | Certificates of Deposit | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 1 | Auction Rate Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 1 | 1.125% Call Option Derivative Asset | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | ' |
Level 2 | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 596,859 | 277,580 |
Embedded cash conversion option derivative liability | 0 | 1,307 |
Contingent consideration liabilities | 0 | ' |
Total liabilities measured at fair value on a recurring basis | 0 | ' |
Level 2 | Corporate Debt Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 449,772 | 191,008 |
Level 2 | GSEs | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 2 | Municipal Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 113,330 | 75,848 |
Level 2 | US Treasury Notes Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 2 | Certificates of Deposit | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 33,757 | 10,724 |
Level 2 | Auction Rate Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 2 | 1.125% Call Option Derivative Asset | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | ' |
Level 3 | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 197,249 | 13,419 |
Embedded cash conversion option derivative liability | 186,239 | 0 |
Contingent consideration liabilities | 57,548 | ' |
Total liabilities measured at fair value on a recurring basis | 243,787 | ' |
Level 3 | Corporate Debt Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 3 | GSEs | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 3 | Municipal Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 3 | US Treasury Notes Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 3 | Certificates of Deposit | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Level 3 | Auction Rate Securities | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | 10,898 | 13,419 |
Level 3 | 1.125% Call Option Derivative Asset | ' | ' |
Fair value of assets measured on recurring basis | ' | ' |
Total assets measured at fair value on a recurring basis | $186,351 | ' |
Fair_Value_Measurements_Unobse
Fair Value Measurements Unobservable Inputs (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Auction Rate Securities | ' | ' |
Assets measured at fair value on recurring basis using unobservable inputs | ' | ' |
Balance, beginning period | $13,419 | $16,134 |
Net unrealized gains included in other comprehensive income | 729 | 1,635 |
Net unrealized losses included in other expenses | 0 | ' |
Derivative issuance | 0 | ' |
Auction rate securities settlements | -3,250 | -4,350 |
Acquisitions | 0 | ' |
Balance, ending period | 10,898 | 13,419 |
The amount of total unrealized gains for the period included in other comprehensive income attributable to the change in accumulated other comprehensive losses relating to assets still held at December 31, 2011 | 541 | 1,059 |
Derivative | ' | ' |
Assets measured at fair value on recurring basis using unobservable inputs | ' | ' |
Balance, beginning period | 0 | 0 |
Net unrealized gains included in other comprehensive income | 0 | 0 |
Net unrealized losses included in other expenses | -3,810 | ' |
Derivative issuance | -75,074 | ' |
Auction rate securities settlements | 0 | 0 |
Derivative re-designation | 78,996 | ' |
Acquisitions | 0 | ' |
Balance, ending period | 112 | 0 |
The amount of total unrealized gains for the period included in other comprehensive income attributable to the change in accumulated other comprehensive losses relating to assets still held at December 31, 2011 | 0 | 0 |
Accrued Liabilities | ' | ' |
Assets measured at fair value on recurring basis using unobservable inputs | ' | ' |
Acquisitions | -57,548 | ' |
Balance, ending period | ($57,548) | ' |
Fair_Value_Measurements_Longte
Fair Value Measurements Long-term Debt (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Level 1 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | $0 | $0 |
Level 2 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 792,118 | 208,460 |
Level 3 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 0 | 87,471 |
1.125% Notes | Level 1 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 0 | ' |
1.125% Notes | Level 2 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 572,627 | ' |
1.125% Notes | Level 3 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 0 | ' |
3.75% Convertible Senior Notes due 2014 | Level 1 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 0 | 0 |
3.75% Convertible Senior Notes due 2014 | Level 2 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 219,491 | 208,460 |
3.75% Convertible Senior Notes due 2014 | Level 3 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 0 | 0 |
Term loan | Level 1 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | ' | 0 |
Term loan | Level 2 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | ' | 0 |
Term loan | Level 3 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | ' | 47,471 |
Credit facility | Level 1 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | ' | 0 |
Credit facility | Level 2 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | ' | 0 |
Credit facility | Level 3 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | ' | 40,000 |
Carrying (Reported) Amount, Fair Value Disclosure | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 598,240 | 262,939 |
Carrying (Reported) Amount, Fair Value Disclosure | 1.125% Notes | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 416,368 | ' |
Carrying (Reported) Amount, Fair Value Disclosure | 3.75% Convertible Senior Notes due 2014 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 181,872 | 175,468 |
Carrying (Reported) Amount, Fair Value Disclosure | Term loan | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | ' | 47,471 |
Carrying (Reported) Amount, Fair Value Disclosure | Credit facility | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | ' | 40,000 |
Estimate of Fair Value Measurement | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 792,118 | 295,931 |
Estimate of Fair Value Measurement | 1.125% Notes | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 572,627 | ' |
Estimate of Fair Value Measurement | 3.75% Convertible Senior Notes due 2014 | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | 219,491 | 208,460 |
Estimate of Fair Value Measurement | Term loan | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | ' | 47,471 |
Estimate of Fair Value Measurement | Credit facility | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Estimated fair values of long-term debt | ' | $40,000 |
Investments_Details
Investments (Details) (USD $) | 12 Months Ended | 12 Months Ended | 69 Months Ended | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2008 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
Auction Rate Securities | Auction Rate Securities | Auction Rate Securities | Auction Rate Securities | Auction Rate Securities | |||||
Minimum | Maximum | ||||||||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Realized Investment Gains (Losses) | $300,000 | $300,000 | $400,000 | ' | ' | ' | ' | ' | ' |
Student loan portfolios pledged as collateral, term of loans | ' | ' | ' | ' | ' | ' | ' | '17 years | '32 years |
Auction rate securities | ' | ' | ' | 82,100,000 | ' | ' | ' | ' | ' |
Auction rate securities settled during period | ' | ' | ' | ' | ' | ' | 70,700,000 | ' | ' |
Unrealized gain on auction rate securities | ($1,015,000) | $1,529,000 | $1,167,000 | ' | $700,000 | $1,600,000 | ' | ' | ' |
Investments_Schedule_of_Invest
Investments Schedule of Investments (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Investments | ' | ' |
Amortized Cost | $715,702 | $357,000 |
Gross Unrealized Gains | 613 | 809 |
Gross Unrealized Losses | 2,365 | 1,545 |
Estimated Fair Value | 713,950 | 356,264 |
Corporate Debt Securities | ' | ' |
Investments | ' | ' |
Amortized Cost | 450,162 | 190,545 |
Gross Unrealized Gains | 442 | 528 |
Gross Unrealized Losses | 832 | 65 |
Estimated Fair Value | 449,772 | 191,008 |
GSEs | ' | ' |
Investments | ' | ' |
Amortized Cost | 68,898 | 29,481 |
Gross Unrealized Gains | 6 | 45 |
Gross Unrealized Losses | 87 | 1 |
Estimated Fair Value | 68,817 | 29,525 |
Municipal Securities | ' | ' |
Investments | ' | ' |
Amortized Cost | 114,126 | 75,909 |
Gross Unrealized Gains | 119 | 185 |
Gross Unrealized Losses | 915 | 246 |
Estimated Fair Value | 113,330 | 75,848 |
US Treasury Notes Securities | ' | ' |
Investments | ' | ' |
Amortized Cost | 37,360 | 35,700 |
Gross Unrealized Gains | 44 | 42 |
Gross Unrealized Losses | 28 | 2 |
Estimated Fair Value | 37,376 | 35,740 |
Certificates of Deposit | ' | ' |
Investments | ' | ' |
Amortized Cost | 33,756 | 10,715 |
Gross Unrealized Gains | 2 | 9 |
Gross Unrealized Losses | 1 | 0 |
Estimated Fair Value | 33,757 | 10,724 |
Short-term Investments | ' | ' |
Investments | ' | ' |
Amortized Cost | 704,302 | 342,350 |
Gross Unrealized Gains | 613 | 809 |
Gross Unrealized Losses | 1,863 | 314 |
Estimated Fair Value | 703,052 | 342,845 |
Auction Rate Securities | ' | ' |
Investments | ' | ' |
Amortized Cost | 11,400 | 14,650 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 502 | 1,231 |
Estimated Fair Value | $10,898 | $13,419 |
Contractual_Maturities_Details
Contractual Maturities (Details) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Contractual maturities of investments | ' |
Due in one year or less, Amortized Cost | $350,488 |
Due one year through five years, Amortized Cost | 353,814 |
Due after ten years, Amortized Cost | 11,400 |
Total, Amortized Cost | 715,702 |
Due in one year or less, Estimated Fair Value | 350,605 |
Due one year through five years, Estimated Fair Value | 352,447 |
Due after ten years, Estimated Fair value | 10,898 |
Total, Estimated fair value | $713,950 |
AvailableforSale_Details
Available-for-Sale (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Security | ||
Available-for-sale investments | ' | ' |
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | $306,531 | $89,195 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | 1,316 | 314 |
Number of securities, 12 months or less | 174 | 72 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | 44,529 | 13,419 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | 1,049 | 1,231 |
Number of securities, 12 months or more | 57 | 21 |
Corporate Debt Securities | ' | ' |
Available-for-sale investments | ' | ' |
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | 210,057 | 44,457 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | 802 | 65 |
Number of securities, 12 months or less | 91 | 23 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | 2,540 | 0 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | 30 | 0 |
Number of securities, 12 months or more | 3 | 0 |
GSEs | ' | ' |
Available-for-sale investments | ' | ' |
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | 53,308 | 5,004 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | 87 | 1 |
Number of securities, 12 months or less | 21 | 1 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | 0 | 0 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | 0 | 0 |
Number of securities, 12 months or more | 0 | 0 |
Municipal Securities | ' | ' |
Available-for-sale investments | ' | ' |
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | 30,715 | 35,223 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | 398 | 246 |
Number of securities, 12 months or less | 49 | 43 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | 31,091 | 0 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | 517 | 0 |
Number of securities, 12 months or more | 39 | 0 |
US Treasury Notes Securities | ' | ' |
Available-for-sale investments | ' | ' |
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | 12,037 | 4,511 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | 28 | 2 |
Number of securities, 12 months or less | 11 | 5 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | 0 | 0 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | 0 | 0 |
Number of securities, 12 months or more | 0 | 0 |
Certificates of Deposit | ' | ' |
Available-for-sale investments | ' | ' |
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | 414 | ' |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | 1 | ' |
Number of securities, 12 months or less | 2 | ' |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | 0 | ' |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | 0 | ' |
Number of securities, 12 months or more | 0 | ' |
Auction Rate Securities | ' | ' |
Available-for-sale investments | ' | ' |
In a Continuous Loss Position for Less than 12 Months, Estimated Fair Value | 0 | 0 |
In a Continuous Loss Position for Less than 12 Months, Unrealized Losses | 0 | 0 |
Number of securities, 12 months or less | 0 | 0 |
In a Continuous Loss Position for 12 Months or More, Estimated Fair value | 10,898 | 13,419 |
In a Continuous Loss Position for 12 Months or More, Unrealized Losses | $502 | $1,231 |
Number of securities, 12 months or more | 15 | 21 |
Receivables_Details
Receivables (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Summary of accounts receivable | ' | ' |
Total receivables | $298,935 | $149,682 |
Health Plans | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 278,300 | 127,098 |
Molina Medicaid Solutions Segment | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 20,635 | 22,584 |
California | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 148,654 | 28,553 |
Florida | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 2,901 | 953 |
Illinois | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 5,773 | 0 |
Michigan | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 15,253 | 12,873 |
New Mexico | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 17,056 | 9,059 |
Ohio | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 43,969 | 40,980 |
Texas | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 9,736 | 7,459 |
Utah | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 10,953 | 3,359 |
Washington | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 13,455 | 17,587 |
Wisconsin | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | 8,087 | 4,098 |
Direct delivery and other | ' | ' |
Summary of accounts receivable | ' | ' |
Total receivables | $2,463 | $2,177 |
Property_Equipment_and_Capital2
Property, Equipment, and Capitalized Software - Summary of Property, Equipment, and Capitalized Software (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Summary of property and equipment | ' | ' |
Property and equipment, gross | $500,017 | $392,500 |
Less: accumulated depreciation and amortization on building and improvements, furniture and equipment | -103,918 | -84,156 |
Less: accumulated amortization for capitalized software | -104,016 | -86,901 |
Accumulated depreciation, Total | -207,934 | -171,057 |
Property, equipment, and capitalized software, net | 292,083 | 221,443 |
Land | ' | ' |
Summary of property and equipment | ' | ' |
Property and equipment, gross | 15,764 | 15,764 |
Building and improvements | ' | ' |
Summary of property and equipment | ' | ' |
Property and equipment, gross | 165,670 | 124,163 |
Furniture and equipment | ' | ' |
Summary of property and equipment | ' | ' |
Property and equipment, gross | 131,478 | 97,865 |
Capitalized software | ' | ' |
Summary of property and equipment | ' | ' |
Property and equipment, gross | $187,105 | $154,708 |
Property_Equipment_and_Capital3
Property, Equipment, and Capitalized Software - Future Minimum Rentals (Details) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Summary of future minimum rentals on non cancelable leases | ' |
2014 | $4,192 |
2015 | 4,110 |
2016 | 3,542 |
2017 | 3,742 |
2018 | 3,581 |
Thereafter | 2,832 |
Total minimum future rentals | $21,999 |
Property_Equipment_and_Capital4
Property, Equipment, and Capitalized Software (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Depreciation expense recognized | $26.60 | $20.50 | $17.50 |
Amortization of capitalized software | $46.40 | $36.20 | $30.20 |
Goodwill_and_Intangible_Assets2
Goodwill and Intangible Assets (Details) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2013 |
Future Amortization Expenses | ' |
Future amortization expense, 2014 | 20.4 |
Future amortization expense, 2015 | 14.7 |
Future amortization expense, 2016 | 12.7 |
Future amortization expense, 2017 | 12.4 |
Future amortization expense, 2018 | 12.1 |
Minimum | ' |
Indefinite-lived Intangible Assets by Major Class [Line Items] | ' |
Weighted average amortization period | '1 year |
Maximum | ' |
Indefinite-lived Intangible Assets by Major Class [Line Items] | ' |
Weighted average amortization period | '15 years |
Contract rights | ' |
Indefinite-lived Intangible Assets by Major Class [Line Items] | ' |
Weighted average amortization period | '10 years |
Customer relationships | ' |
Indefinite-lived Intangible Assets by Major Class [Line Items] | ' |
Weighted average amortization period | '5 years |
Contract backlog | ' |
Indefinite-lived Intangible Assets by Major Class [Line Items] | ' |
Weighted average amortization period | '3 years |
Provider networks | ' |
Indefinite-lived Intangible Assets by Major Class [Line Items] | ' |
Weighted average amortization period | '10 years |
Goodwill_and_Intangible_Assets3
Goodwill and Intangible Assets Intangible Assets Balances (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ' | ' |
Cost | $237,948 | $196,072 |
Accumulated amortization | 139,077 | 118,361 |
Net balance | 98,871 | 77,711 |
Contract rights and licenses | ' | ' |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ' | ' |
Cost | 176,428 | 135,932 |
Accumulated amortization | 92,789 | 81,376 |
Net balance | 83,639 | 54,556 |
Customer relationships | ' | ' |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ' | ' |
Cost | 24,550 | 24,550 |
Accumulated amortization | 18,801 | 12,513 |
Net balance | 5,749 | 12,037 |
Contract backlog | ' | ' |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ' | ' |
Cost | 23,600 | 23,600 |
Accumulated amortization | 19,624 | 17,870 |
Net balance | 3,976 | 5,730 |
Provider networks | ' | ' |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ' | ' |
Cost | 13,370 | 11,990 |
Accumulated amortization | 7,863 | 6,602 |
Net balance | $5,507 | $5,388 |
Goodwill_and_Intangible_Assets4
Goodwill and Intangible Assets Balances of Goodwill and Indefinite-lived Intangible Assets (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Changes in the carrying amount of goodwill and indefinite-lived intangible assets | ' | ' |
Goodwill and indefinite-lived intangible assets, gross | $289,268 | $209,618 |
Accumulated impairment losses | -58,530 | -58,530 |
Goodwill and indefinite-lived intangible assets, net | 230,738 | 151,088 |
Goodwill, reductions | $79,650 | ' |
Restricted_Investments_Balance
Restricted Investments - Balances of Restricted Investments (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | $63,093 | $44,101 |
California | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 373 | 373 |
Florida | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 9,242 | 5,738 |
Illinois | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 310 | 310 |
Michigan | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 1,014 | 1,014 |
New Mexico | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 24,622 | 15,915 |
Ohio | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 9,080 | 9,082 |
Texas | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 3,500 | 3,503 |
Utah | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 3,301 | 3,126 |
Washington | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 151 | 151 |
Other | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 1,196 | 4,889 |
Health Plans | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | 52,789 | 44,101 |
Molina Medicaid Solutions Segment | ' | ' |
Summary of restricted investments by health plan | ' | ' |
Restricted investments by health plan | $10,304 | $0 |
Restricted_Investments_Maturit
Restricted Investments - Maturities of Held-to-Maturity (Details) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Contractual maturities of our held-to-maturity restricted investments | ' |
Amortized Cost, Due in one year or less | $58,542 |
Amortized Cost, Due one year through five years | 4,551 |
Amortized Cost, Total | 63,093 |
Estimated Fair Value, Due in one year or less | 58,543 |
Estimated Fair Value, Due one year through five years | 4,555 |
Estimated Fair Value, Total | $63,098 |
Medical_Claims_and_Benefits_Pa2
Medical Claims and Benefits Payable (Details) (USD $) | 12 Months Ended | 0 Months Ended | ||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Jul. 02, 2013 | |
Minimum | Maximum | Ohio | ||||
Group_of_Members | ||||||
member | ||||||
Insurance Claims [Line Items] | ' | ' | ' | ' | ' | ' |
Medical claims and benefits payable | $151,300,000 | ' | ' | ' | ' | ' |
Estimated discount percentage of final payment on claims incurred but not paid | ' | ' | ' | 8.00% | 10.00% | ' |
Policy holder benefits prior percentage | 10.70% | 9.80% | 14.60% | ' | ' | ' |
prior period claims recognized | $52,779,000 | $39,295,000 | $51,809,000 | ' | ' | ' |
New members added | ' | ' | ' | ' | ' | 25,000 |
Groups of blind and disabled children members | ' | ' | ' | ' | ' | 2 |
Medical_Claims_and_Benefits_Pa3
Medical Claims and Benefits Payable - Components of the Change (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ' | ' | ' |
Balance at beginning of period | $494,530 | $402,476 | $354,356 |
Liability for Unpaid Claims and Claims Adjustment Expense, Incurred Claims [Abstract] | ' | ' | ' |
Current period | 5,434,443 | 5,136,055 | 3,911,803 |
Prior periods | -52,779 | -39,295 | -51,809 |
Total medical care costs | 5,381,664 | 5,096,760 | 3,859,994 |
Change in non-risk provider payables | 111,267 | -7,004 | 20,630 |
Liability for Unpaid Claims and Claims Adjustment Expense, Claims Paid [Abstract] | ' | ' | ' |
Current period | 4,932,195 | 4,689,395 | 3,564,030 |
Prior periods | 385,479 | 308,307 | 268,474 |
Total paid | 5,317,674 | 4,997,702 | 3,832,504 |
Balance at end of period | $669,787 | $494,530 | $402,476 |
Benefit from prior years as a percentage of: | ' | ' | ' |
Balance at beginning of year | 10.70% | 9.80% | 14.60% |
Premium revenue | 0.90% | 0.70% | 1.20% |
Medical care costs | 1.00% | 0.80% | 1.30% |
LongTerm_Debt_Maturities_Detai
Long-Term Debt Maturities (Details) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Maturities of Long-term Debt [Abstract] | ' |
Total | $737,000 |
2014 | 187,000 |
2015 | 0 |
2016 | 0 |
2017 | 0 |
2018 | 0 |
Thereafter | 550,000 |
1.125% Cash Convertible Senior Notes due 2020 | ' |
Maturities of Long-term Debt [Abstract] | ' |
Total | 550,000 |
2014 | 0 |
2015 | 0 |
2016 | 0 |
2017 | 0 |
2018 | 0 |
Thereafter | 550,000 |
3.75% Convertible Senior Notes due 2014 | ' |
Maturities of Long-term Debt [Abstract] | ' |
Total | 187,000 |
2014 | 187,000 |
2015 | 0 |
2016 | 0 |
2017 | 0 |
2018 | 0 |
Thereafter | $0 |
LongTerm_Debt_1125_Senior_Note
Long-Term Debt 1.125% Senior Notes (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | 3 Months Ended | 12 Months Ended | 0 Months Ended | |||||
Feb. 15, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 11, 2013 | Feb. 15, 2013 | Mar. 31, 2013 | Dec. 31, 2013 | Feb. 13, 2013 | Feb. 15, 2013 | Feb. 11, 2013 | |
1.125% Cash Convertible Senior Notes due 2020 | 1.125% Cash Convertible Senior Notes due 2020 | 1.125% Cash Convertible Senior Notes due 2020 | 1.125% Cash Convertible Senior Notes due 2020 | 1.125% Cash Convertible Senior Notes due 2020 | Senior Notes | Loss on embedded cash conversion option | |||||
D | 1.125% Cash Convertible Senior Notes due 2020 | 1.125% Cash Convertible Senior Notes due 2020 | |||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount | ' | $737,000,000 | ' | ' | ' | ' | ' | $550,000,000 | ' | $550,000,000 | ' |
Percentage of contractual interest rate | ' | ' | ' | ' | ' | 1.13% | ' | 1.13% | ' | 1.13% | ' |
Proceeds from issuance of 1.125% Notes | ' | 537,973,000 | 0 | 0 | 450,000,000 | ' | ' | ' | ' | ' | ' |
Over-allotment option, amount | ' | ' | ' | ' | ' | ' | ' | ' | 100,000,000 | ' | ' |
Aggregate net proceeds from 1.125% Notes | ' | ' | ' | ' | ' | 463,700,000 | ' | ' | ' | ' | ' |
Payments for repurchase of common stock | ' | 52,662,000 | 3,000,000 | 7,000,000 | ' | 50,000,000 | ' | ' | ' | ' | ' |
Repayments of outstanding indebtedness | 40,000,000 | ' | ' | ' | ' | 40,000,000 | ' | ' | ' | ' | ' |
Debt instrument, threshold trading days | ' | ' | ' | ' | ' | 20 | ' | ' | ' | ' | ' |
Debt instrument, threshold consecutive trading days | ' | ' | ' | ' | ' | ' | ' | ' | ' | '30 days | ' |
Debt instrument, threshold percentage of stock price trigger | ' | ' | ' | ' | ' | ' | ' | ' | ' | 130.00% | ' |
Maximum percentage market price for converting notes under second case | ' | ' | ' | ' | ' | ' | ' | ' | ' | 98.00% | ' |
Debt instrument, conversion ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.0245277 | ' |
Debt instrument conversion price per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | $40.77 | ' |
Mandatory redemption purchase price, percentage of principal (in percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' |
Initial fair value liability of the embedded cash conversion option | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 149,300,000 |
Senior note effective interest rate (in percent) | ' | ' | ' | ' | ' | 5.90% | ' | ' | ' | ' | ' |
Senior notes amortization period (in years) | ' | ' | ' | ' | ' | ' | ' | '6 years 0 months | ' | ' | ' |
Transaction costs paid | ' | 0 | 0 | 1,125,000 | ' | 16,900,000 | ' | ' | ' | ' | ' |
Deferred finance costs, gross | ' | ' | ' | ' | ' | 12,000,000 | ' | ' | ' | ' | ' |
Interest expense related to 1.125% Call Option and Warrants | ' | ' | ' | ' | ' | ' | 4,900,000 | ' | ' | ' | ' |
Purchase of 1.125% Notes call option | 149,331,000 | 149,331,000 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' |
Proceeds from issuance of warrants | 75,074,000 | 75,074,000 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' |
Cash paid for the Call Spread Overlay | 74,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash paid for premium to counterparties | $149,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trading days measurement period (in days) | '160 days | '160 days | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrant market value exceeding such strike price trigger | 0.63% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of warrants issued | 13,490,236 | 13,490,236 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Striking price of Warrants (in percent) | 53.8475 | 53.8475 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
LongTerm_Debt_375_Convertible_
Long-Term Debt 3.75% Convertible Notes (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 15, 2013 | Dec. 31, 2013 |
3.75% Convertible Senior Notes due 2014 | 3.75% Convertible Senior Notes due 2014 | Senior Notes | Senior Notes | ||
3.75% Convertible Senior Notes due 2014 | 3.75% Convertible Senior Notes due 2014 | ||||
D | |||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' |
Principal amount | $737,000,000 | $187,000,000 | $187,000,000 | ' | $187,000,000 |
Percentage of contractual interest rate | ' | ' | ' | ' | 3.75% |
Debt instrument, conversion ratio | ' | ' | ' | 0.0319601 | ' |
Debt instrument conversion price per share | ' | ' | ' | ' | $31.29 |
Debt instrument, threshold trading days | ' | ' | ' | ' | 20 |
Debt instrument, threshold consecutive trading days | ' | ' | ' | ' | '30 days |
Debt instrument, threshold percentage of stock price trigger | ' | ' | ' | ' | 120.00% |
Maximum percentage market price for converting notes under second case | ' | ' | ' | ' | 98.00% |
Daily conversion value | ' | ' | ' | ' | 50 |
Senior note effective interest rate (in percent) | ' | ' | ' | ' | 7.50% |
Senior notes debt maturity date | ' | ' | ' | ' | 1-Oct-14 |
Senior notes amortization period (in years) | ' | ' | ' | ' | '9 months |
Amount in excess of principal if the 3.75% Notes were to converted | ' | 11,100,000 | ' | ' | ' |
Amount of equity component of notes net of deferred taxes | ' | ' | ' | ' | $24,000,000 |
LongTerm_Debt_Interest_Cost_Re
Long-Term Debt Interest Cost Recognized (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Interest cost recognized for the period relating to the: | ' | ' | ' |
Contractual interest coupon rate of 3.75% | $12,427 | $7,012 | $7,012 |
Amortization of the discount on the liability component | 22,103 | 5,942 | 5,512 |
Total interest cost recognized | $34,530 | $12,954 | $12,524 |
LongTerm_Debt_Details_of_the_L
Long-Term Debt Details of the Liability Component (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Debt Instrument [Line Items] | ' | ' |
Principal amount | $737,000,000 | ' |
Unamortized discount | 138,760,000 | ' |
Net carrying amount | 598,240,000 | ' |
Cash Convertible Senior Notes due 2020 | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Principal amount | 550,000,000 | ' |
Unamortized discount | 133,632,000 | ' |
Net carrying amount | 416,368,000 | ' |
3.75% Convertible Senior Notes due 2014 | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Principal amount | 187,000,000 | 187,000,000 |
Unamortized discount | 5,128,000 | 11,532,000 |
Net carrying amount | $181,872,000 | $175,468,000 |
LongTerm_Debt_Lease_Financing_
Long-Term Debt Lease Financing Obligations, Term Loan, Credit Facility(Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | |||
Feb. 15, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2011 | Jun. 12, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | |
letters_of_credit | Term loan | June 2013 Transactions | June 2013 Transactions | June 2013 Transactions | Construction in Progress | Construction in Progress | ||||
property | February 2013 Transactions | February 2013 Transactions | ||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of leaseback properties | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' |
Proceeds from sale-leaseback transactions | ' | $158,694,000 | $0 | $0 | ' | $158,700,000 | ' | ' | ' | ' |
Carrying values of sale leaseback properties | ' | ' | ' | ' | ' | ' | ' | 76,800,000 | ' | ' |
Sale leaseback lease term (in years) | ' | ' | ' | ' | ' | ' | '25 years | '25 years | '11 years 6 months | ' |
Aggregate lease financing obligations | ' | ' | ' | ' | ' | ' | ' | 159,400,000 | ' | ' |
Annual increase in rental payment (in percent) | ' | ' | ' | ' | ' | ' | ' | 3.00% | ' | ' |
Deferred finance costs, gross | ' | ' | ' | ' | ' | ' | ' | 3,500,000 | ' | ' |
Property and equipment, net | ' | 292,083,000 | 221,443,000 | ' | ' | ' | ' | ' | ' | 26,600,000 |
Lease financing obligation related to the construction projects | ' | ' | ' | ' | ' | ' | ' | ' | ' | 27,200,000 |
Interest expense related to lease financing obligations | ' | 52,071,000 | 16,769,000 | 15,519,000 | ' | ' | ' | ' | ' | 1,300,000 |
Principal amount | ' | 737,000,000 | ' | ' | 48,600,000 | ' | ' | ' | ' | ' |
Repayments of outstanding indebtedness | 40,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity under the revolving credit facility | 170,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit principal outstanding | ' | ' | 40,000,000 | ' | ' | ' | ' | ' | ' | ' |
Number of letters of credit outstanding | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' |
Letters of credit outstanding amount | ' | ' | $10,300,000 | ' | ' | ' | ' | ' | ' | ' |
Derivative_Financial_Instrumen2
Derivative Financial Instruments (Details) (USD $) | 0 Months Ended | 1 Months Ended | |
In Millions, unless otherwise specified | Jun. 14, 2013 | 31-May-12 | 31-May-12 |
Interest Rate Swap | Not Designated as Hedging Instrument | ||
Interest Rate Swap | |||
Derivative [Line Items] | ' | ' | ' |
Notional amount of interest rate swap agreement | ' | ' | $42.50 |
Interest rate swap effective date | ' | 1-Mar-13 | ' |
Settlement of interest rate swap | $0.90 | ' | ' |
Derivative_Financial_Instrumen3
Derivative Financial Instruments Fair Value on Consolidated Balance Sheets (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Derivative [Line Items] | ' | ' |
Derivative Liability, Fair Value, Gross Liability | $186,239 | $1,307 |
Gain on 1.125% Call Option | Non-current assets | ' | ' |
Derivative [Line Items] | ' | ' |
Derivative Asset, Fair Value, Gross Asset | 186,351 | 0 |
Loss on embedded cash conversion option | Non-current liabilities | ' | ' |
Derivative [Line Items] | ' | ' |
Derivative Liability, Fair Value, Gross Liability | 186,239 | 0 |
Interest Rate Swap | Non-current liabilities | ' | ' |
Derivative [Line Items] | ' | ' |
Derivative Liability, Fair Value, Gross Liability | $0 | $1,307 |
Derivative_Financial_Instrumen4
Derivative Financial Instruments Gain (Loss) on Statement of Operations (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' |
Change in fair value of derivatives | ($3,378) | ($1,307) | $0 |
Gain on 1.125% Call Option | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' |
Change in fair value of derivatives | 37,020 | 0 | 0 |
Embedded cash conversion option | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' |
Change in fair value of derivatives | -36,908 | 0 | 0 |
1.125% Warrants | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' |
Change in fair value of derivatives | -3,923 | 0 | 0 |
Interest Rate Swap | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' |
Change in fair value of derivatives | 433 | -1,307 | 0 |
Other Income | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' |
Change in fair value of derivatives | -3,378 | -1,307 | ' |
Other Income | Gain on 1.125% Call Option | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' |
Change in fair value of derivatives | 37,020 | 0 | ' |
Other Income | Embedded cash conversion option | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' |
Change in fair value of derivatives | -36,908 | 0 | ' |
Other Income | 1.125% Warrants | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' |
Change in fair value of derivatives | -3,923 | 0 | ' |
Other Income | Interest Rate Swap | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' |
Change in fair value of derivatives | $433 | ($1,307) | ' |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Operating Loss Carryforwards [Line Items] | ' | ' | ' | ' |
Tax-related deficiencies on share-based compensation | $1,600,000 | $3,100,000 | $900,000 | ' |
California enterprise zone tax credit carryovers | 10,800,000 | ' | ' | ' |
Deferred tax assets | 3,600,000 | ' | ' | ' |
Increase in deferred tax asset valuation allowance | 600,000 | ' | ' | ' |
Valuation allowance | 3,600,000 | 3,000,000 | ' | ' |
Tax benefits fully recognized | 5,700,000 | 7,400,000 | 7,400,000 | ' |
Liability for unrecognized tax benefits | 6,200,000 | ' | ' | ' |
Payment of interest and penalties | 79,000 | 56,000 | 65,000 | ' |
Unrecognized tax benefits | 8,030,000 | 10,622,000 | 10,712,000 | 10,962,000 |
State | ' | ' | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' | ' |
Net operating loss carryforwards | 57,200,000 | ' | ' | ' |
Unrecognized tax benefits related to state refund claim | 5,900,000 | ' | ' | ' |
Domestic Country | ' | ' | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' | ' |
Net operating loss carryforwards | $200,000 | ' | ' | ' |
Income_Taxes_Provision_for_inc
Income Taxes Provision for income taxes (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Current: | ' | ' | ' |
Federal | $66,883 | $23,019 | $24,435 |
State | 581 | 1,254 | 1,587 |
Total current | 67,464 | 24,273 | 26,022 |
Deferred: | ' | ' | ' |
Federal | -25,498 | -9,205 | 16,905 |
State | -5,650 | -4,555 | -13 |
Total deferred | -31,148 | -13,760 | 16,892 |
Total provision for income taxes | $36,316 | $10,513 | $42,914 |
Income_Taxes_Reconciliation_of
Income Taxes Reconciliation of the U.S. Federal Statutory Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Effective income tax rate reconciliation to the statutory federal income tax rate | ' | ' | ' |
Statutory federal tax rate | 35.00% | 35.00% | 35.00% |
State income taxes, net of federal benefit | -0.50% | -9.20% | 0.90% |
Change in unrecognized tax benefits | -3.70% | 0.70% | -0.30% |
Nondeductible compensation | 9.60% | 6.20% | 0.00% |
Nondeductible lobbying | 1.60% | 4.20% | 0.60% |
Purchase accounting adjustment | 0.00% | 0.00% | -0.80% |
Nondeductible fair value of 1.125% Warrants | 2.40% | 0.00% | 0.00% |
Change in fair value of contingent consideration liabilities | -0.30% | 4.80% | 0.00% |
Other | 0.70% | 3.30% | 0.30% |
Effective tax rate | 44.80% | 45.00% | 35.70% |
Income_Taxes_Deferred_Tax_Asse
Income Taxes Deferred Tax Assets and Liabilities (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Significant components of deferred tax assets and liabilities | ' | ' |
Accrued expenses | $19,545 | $15,381 |
Reserve liabilities | 1,712 | 2,936 |
State taxes | -1,323 | -606 |
Other accrued medical costs | 2,540 | 2,518 |
Net operating losses | 27 | 27 |
Unrealized losses (gains) | 380 | -283 |
Unearned premiums | 10,543 | 15,675 |
Prepaid expenses | -5,354 | -4,390 |
Basis in debt | -2,162 | 0 |
Deferred compensation | 2,087 | 1,611 |
Other, net | -928 | 176 |
Valuation allowance | -511 | -602 |
Deferred tax asset, net of valuation allowance - current | 26,556 | 32,443 |
Reserve liabilities | 1,909 | 2,013 |
State tax credit carryover | 7,027 | 4,149 |
Net operating losses | 2,326 | 3,341 |
Unrealized losses | 286 | 563 |
Depreciation and amortization | -40,433 | -44,198 |
Deferred compensation | 3,404 | 3,323 |
Lease financing obligation | 27,543 | 0 |
Debt basis | 466 | -5,410 |
Other, net | -24 | 702 |
Valuation allowance | -3,084 | -2,383 |
Deferred tax liability, net of valuation allowance - long term | -580 | -37,900 |
Net deferred income tax liability | $25,976 | ($5,457) |
Income_Taxes_Unrecognized_Tax_
Income Taxes Unrecognized Tax Benefits (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Unrecognized tax benefits roll forward | ' | ' | ' |
Gross unrecognized tax benefits at beginning of period | ($10,622) | ($10,712) | ($10,962) |
Increases in tax positions for prior years | 0 | -441 | -137 |
Decreases in tax positions for prior years | 3,615 | 320 | 0 |
Increases in tax positions for current year | -2,084 | 0 | 0 |
Decreases in tax positions for current year | 886 | 0 | 0 |
Lapse in statute of limitations | 175 | 211 | 387 |
Gross unrecognized tax benefits at end of period | ($8,030) | ($10,622) | ($10,712) |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 0 Months Ended | 3 Months Ended | 12 Months Ended | 1 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | |||||||||||||||
Feb. 15, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | 1-May-13 | Apr. 30, 2013 | Feb. 28, 2013 | Oct. 26, 2011 | Dec. 31, 2012 | Dec. 31, 2013 | Feb. 13, 2013 | Feb. 28, 2013 | Sep. 30, 2013 | Nov. 30, 2013 | Dec. 26, 2012 | ||||
February 13, 2013, Repurchase Program | October 26, 2011, Repurchase Program | October 26, 2011, Repurchase Program | Common Stock | Common Stock | Common Stock | Common Stock | Common Stock | Common Stock | ||||||||||||||||||
Repurchase in Connection with Offering of 1.125% Cash Convertible Senior Notes | Repurchase in Connection with Offering of 1.125% Cash Convertible Senior Notes | September 2013 Repurchase Program | September 2013 Repurchase Program | December 26, 2012, Repurchase Program | ||||||||||||||||||||||
Molina Family Trust | ||||||||||||||||||||||||||
Equity, Class of Treasury Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Stockholders' equity increased during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | $110,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Increase to stockholders' equity due to reclassification of 1.125% Warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | 79,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Net income | ' | -9,126,000 | 7,569,000 | 24,571,000 | [1] | 29,915,000 | [2] | 25,643,000 | 3,364,000 | -37,306,000 | 18,089,000 | [2] | 52,929,000 | 9,790,000 | 20,818,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase to additional paid-in capital | ' | ' | ' | ' | ' | ' | ' | ' | ' | 32,000,000 | 19,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Purchase of treasury stock, amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | 52,662,000 | 3,000,000 | 7,000,000 | ' | ' | ' | ' | ' | 52,700,000 | 50,000,000 | ' | ' | 2,700,000 | 3,000,000 | |||
Common stock, shares authorized | ' | 150,000,000 | ' | ' | ' | 150,000,000 | ' | ' | ' | 150,000,000 | 150,000,000 | ' | 150,000,000 | 80,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Stated interest rate for Warrants | ' | 1.13% | ' | ' | ' | ' | ' | ' | ' | 1.13% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Trading days measurement period (in days) | '160 days | ' | ' | ' | ' | ' | ' | ' | ' | '160 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Number of warrants issued | 13,490,236 | ' | ' | ' | ' | ' | ' | ' | ' | 13,490,236 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Striking price of Warrants (in percent) | 53.8475 | 53.8475 | ' | ' | ' | ' | ' | ' | ' | 53.8475 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Number of securities purchased under securities repurchase program | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | 1,624,959 | ' | 85,086 | 110,988 | |||
Stock repurchase program average price per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $30.77 | ' | $31.28 | $27.03 | |||
Approved amount related to stock repurchase program | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $75,000,000 | $75,000,000 | ' | ' | ' | ' | $50,000,000 | ' | ' | |||
Issued shares of common stock, net of shares used to settle employees’ income tax obligations | ' | ' | ' | ' | ' | ' | ' | ' | ' | 820,000 | 1,057,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
[1] | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | |||||||||||||||||||||||||
[2] | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. |
Employee_Benefits_Details
Employee Benefits (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Postemployment Benefits [Abstract] | ' | ' | ' |
Maximum matching contribution by employer under defined contribution plan | 4.00% | ' | ' |
Expense recognized in connection with contributions | $12.80 | $10.70 | $8.50 |
Deferred compensation plan deferral percentage of basic salary | 100.00% | ' | ' |
Deferred compensation plan deferral percentage of bonus | 100.00% | ' | ' |
ShareBased_Compensation_Detail
Share-Based Compensation (Details) (USD $) | 1 Months Ended | 12 Months Ended | ||
Mar. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Plan | ||||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Number of employee equity incentives plans | ' | 2 | ' | ' |
Minimum operating revenue for vesting of awards | $12,000,000,000 | ' | ' | ' |
Employee stock grants and employee stock plan purchases, shares | ' | 299,600 | 277,400 | 201,700 |
Weighted-average grant date fair value of stock options granted (in dollars per share) | ' | $14.67 | $13.97 | ' |
Stock options granted (in shares) | ' | 45,000 | ' | 0 |
Employee Stock Purchase Plan | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Issuance of shares of common stock | ' | ' | ' | 3,000,000 |
Fair market value of common stock (in percent) | ' | 85.00% | ' | ' |
Maximum purchase amount under plan for participants | ' | 25,000 | ' | ' |
Minimal risk free interest rate inputs for fair value measurement (in percent) | ' | 0.10% | 0.10% | 0.10% |
Maximum risk free interest rate inputs for fair value measurement (in percent) | ' | 0.20% | 0.20% | 0.20% |
Minimal expected volatility rate inputs for fair value measurement (in percent) | ' | 30.00% | 30.00% | 30.00% |
Maximum expected volatility rate inputs for fair value measurement (in percent) | ' | 50.00% | 50.00% | 50.00% |
Dividend yield (in percent) | ' | 0.00% | 0.00% | 0.00% |
Maximum Term from the date of grant (in years) | ' | '9 months 18 days | '9 months 18 days | '9 months 18 days |
Unrecognized compensation forfeited rate | ' | 6.10% | ' | ' |
Restricted Stock | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Unrecognized compensation expense | ' | 20,100,000 | ' | ' |
Weighted average period of unrecognized compensation expense | ' | '1 year 9 months 6 days | ' | ' |
Weighted-average grant date fair value per share of the performance awards with vesting conditions based on TSR (in dollars per share) | ' | $29.03 | $23.74 | ' |
Weighted average grant date fair value of restricted units vested (in dollars per share) | ' | $25.45 | ' | ' |
Restricted units granted (in shares) | ' | 587,706 | ' | 0 |
Performance Restricted Stock | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Dividend yield (in percent) | ' | 0.00% | ' | ' |
Maximum Term from the date of grant (in years) | ' | '9 months 29 days | ' | ' |
Risk-free interest rate | ' | 0.14% | ' | ' |
Restricted units granted (in shares) | ' | 456,174 | ' | ' |
Performance and Restricted Units | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Total fair value of restricted and performance award granted | ' | 33,300,000 | 16,200,000 | 18,400,000 |
Total fair value of restricted shares vested | ' | 22,300,000 | 25,400,000 | 12,200,000 |
Restricted Stock Units (RSUs) | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Total fair value of restricted and performance award granted | ' | ' | 300,000 | ' |
Weighted average grant date fair value of restricted units vested (in dollars per share) | ' | ' | $35.01 | ' |
Restricted units granted (in shares) | ' | 0 | ' | ' |
Stock options | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Minimal risk free interest rate inputs for fair value measurement (in percent) | ' | 1.10% | ' | ' |
Maximum risk free interest rate inputs for fair value measurement (in percent) | ' | 1.40% | ' | ' |
Minimal expected volatility rate inputs for fair value measurement (in percent) | ' | 41.30% | ' | ' |
Maximum expected volatility rate inputs for fair value measurement (in percent) | ' | 43.00% | ' | ' |
Dividend yield (in percent) | ' | 0.00% | ' | ' |
Unrecognized compensation expense | ' | $600,000 | ' | ' |
Weighted average period of unrecognized compensation expense | ' | '2 years | ' | ' |
Minimum | Stock options | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Maximum Term from the date of grant (in years) | ' | '6 years | ' | ' |
Maximum | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Stock option expiration period | ' | '10 years | ' | ' |
Maximum | Restricted Stock | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Maximum award vesting period | ' | '4 years | ' | ' |
Maximum | Stock options | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Maximum award vesting period | ' | '4 years | ' | ' |
Maximum Term from the date of grant (in years) | ' | '7 years | ' | ' |
March 2013 Grant | Restricted Stock Units With Performance Conditions | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Number of vesting measurements for restricted stocks with performance conditions | 4 | ' | ' | ' |
Minimum EBITDA percentage for vesting of awards (in percent) | 2.50% | ' | ' | ' |
Performance restricted stock vesting percentage over the three years | 25.00% | ' | ' | ' |
Performance restricted stock vesting percentage upon achievement of three-year returns | 25.00% | ' | ' | ' |
Performance restricted stocks vesting percentage upon achievement of revenues | 25.00% | ' | ' | ' |
Performance restricted stocks vesting percentage upon achievement of EBITDA | 25.00% | ' | ' | ' |
March 2013 Grant | Restricted Stock Units With Performance Conditions | Chief Executive Officer | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Shares awarded | 186,858 | ' | ' | ' |
March 2013 Grant | Restricted Stock Units With Performance Conditions | Chief Financial Officer | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Shares awarded | 93,429 | ' | ' | ' |
March 2013 Grant | Restricted Stock Units With Performance Conditions | Chief Operating Officer | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Shares awarded | 62,286 | ' | ' | ' |
March 2013 Grant | Restricted Stock Units With Performance Conditions | Chief Accounting Officer | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Shares awarded | 28,029 | ' | ' | ' |
March 2013 Grant | Restricted Stock Units With Performance Conditions | Officer | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Shares awarded | 21,800 | ' | ' | ' |
2011 Plan | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Issuance of shares of common stock | ' | 4,500,000 | ' | ' |
TSR | Performance Restricted Stock | ' | ' | ' | ' |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ' | ' | ' | ' |
Weighted-average grant date fair value per share of the performance awards with vesting conditions based on TSR (in dollars per share) | ' | $28.24 | ' | ' |
ShareBased_Compensation_Compon
Share-Based Compensation Components of Share-based Compensation Expenses (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Stock based compensation expense | ' | ' | ' |
Stock based compensation expense-Pretax charges | $28,694 | $20,018 | $17,052 |
Stock based compensation expense Net-of-Tax Amount | 24,501 | 14,556 | 10,658 |
Restricted Stock | ' | ' | ' |
Stock based compensation expense | ' | ' | ' |
Stock based compensation expense-Pretax charges | 26,116 | 18,106 | 15,914 |
Stock based compensation expense Net-of-Tax Amount | 22,489 | 12,943 | 9,946 |
Stock options | ' | ' | ' |
Stock based compensation expense | ' | ' | ' |
Stock based compensation expense-Pretax charges | 2,578 | 1,912 | 1,138 |
Stock based compensation expense Net-of-Tax Amount | $2,012 | $1,613 | $712 |
Restricted_Share_Activity_Deta
Restricted Share Activity (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2011 | |
Restricted Stock | ' | ' |
Shares | ' | ' |
Unvested, shares beginning of period | 986,577 | ' |
Granted | 587,706 | 0 |
Vested | -669,075 | ' |
Forfeited | -61,530 | ' |
Unvested, shares end of period | 1,299,852 | ' |
Weighted Average Grant Date Fair Value | ' | ' |
Unvested, weighted average grant date fair value beginning balance | $23.74 | ' |
Granted | $32.15 | ' |
Vested | $25.45 | ' |
Forfeited | $26.20 | ' |
Unvested, weighted average grant date fair value ending balance | $29.03 | ' |
Performance Restricted Stock | ' | ' |
Shares | ' | ' |
Granted | 456,174 | ' |
Weighted Average Grant Date Fair Value | ' | ' |
Granted | $30.80 | ' |
ShareBased_Compensation_Stock_
Share-Based Compensation Stock Option Activity (Details) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2011 |
Stock option activity | ' | ' |
Stock options outstanding, Shares Beginning of period | 414,061 | ' |
Granted, Shares | 45,000 | 0 |
Exercised, Shares | -79,540 | ' |
Forfeited, Shares | -300 | ' |
Stock options outstanding, Shares Ending balance | 379,221 | ' |
Stock options exercisable and expected to vest, Shares | 379,221 | ' |
Exercisable, Shares | 324,221 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Weighted Average Grant Date Fair Value [Abstract] | ' | ' |
Stock options outstanding, Weighted Average Exercise Price, Beginning of period | $22.39 | ' |
Granted, Weighted Average Exercise Price | $33.02 | ' |
Exercised, Weighted Average Exercise Price | $20.09 | ' |
Forfeited, Weighted Average Exercise Price | $17.63 | ' |
Stock options outstanding, Weighted Average Exercise Price, End of period | $24.14 | ' |
Stock options exercisable and expected to vest, Weighted Average Exercise Price | $24.14 | ' |
Exercisable, Weighted Average Exercise Price | $22.58 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ' | ' |
Stock options outstanding, Average Intrinsic Value | $4,024 | ' |
Stock options exercisable and expected to vest, Average Intrinsic Value | 4,024 | ' |
Exercisable, Average Intrinsic Value | $3,947 | ' |
Stock options outstanding, Weighted Average Remaining Contractual term, Beginning of period | '3 years 5 months | ' |
Stock options exercisable and expected to vest, Weighted Average Remaining Contractual term | '3 years 5 months | ' |
Exercisable, Weighted Average Remaining Contractual term | '2 years 6 months | ' |
ShareBased_Compensation_Weight
Share-Based Compensation Weighted-average Grant Date Fair Value (Details) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Summary of information about stock options outstanding and exercisable | ' |
Number of options outstanding | 379,221 |
Number of Exercisable Options | 324,221 |
Range One | ' |
Summary of information about stock options outstanding and exercisable | ' |
Lower range | $16.89 |
Upper range | $19.11 |
Number of options outstanding | 78,671 |
Outstanding Options, Weighted Average Remaining Contractual Life (Years) | '2 years |
Outstanding Options, Weighted Average Exercise Price | $19.05 |
Number of Exercisable Options | 78,671 |
Exercisable Options, Weighted Average Exercise Price | $19.05 |
Range Two | ' |
Summary of information about stock options outstanding and exercisable | ' |
Lower range | $20.88 |
Upper range | $20.88 |
Number of options outstanding | 147,000 |
Outstanding Options, Weighted Average Remaining Contractual Life (Years) | '3 years 2 months |
Outstanding Options, Weighted Average Exercise Price | $20.88 |
Number of Exercisable Options | 147,000 |
Exercisable Options, Weighted Average Exercise Price | $20.88 |
Range Three | ' |
Summary of information about stock options outstanding and exercisable | ' |
Lower range | $22.86 |
Upper range | $34.82 |
Number of options outstanding | 153,550 |
Outstanding Options, Weighted Average Remaining Contractual Life (Years) | '4 years 5 months |
Outstanding Options, Weighted Average Exercise Price | $29.87 |
Number of Exercisable Options | 98,550 |
Exercisable Options, Weighted Average Exercise Price | $27.93 |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 12 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | ||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 27, 2013 | Feb. 28, 2013 | Feb. 27, 2013 | Feb. 28, 2013 | Dec. 31, 2013 | Dec. 26, 2012 | Feb. 27, 2013 | Feb. 27, 2013 | |
Chief Financial Officer and Director [Member] | Chief Financial Officer and Director [Member] | Chief Financial Officer and Director [Member] | Chief Financial Officer and Director [Member] | Common Stock | December 26, 2012, Repurchase Program | Property Subject to Operating Lease [Member] | Building B [Member] | ||||
Existing Building [Member] | Existing Building [Member] | New Building [Member] | New Building [Member] | Common Stock | 6th & Pine Development, LLC [Member] | Property Subject to Operating Lease [Member] | |||||
sqft | sqft | Molina Family Trust | property | 6th & Pine Development, LLC [Member] | |||||||
Lease_Renewal_Option | |||||||||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Property leased | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' |
Number of property leased that is under construction | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' |
Area of real estate property | ' | ' | ' | ' | 90,000 | ' | 120,000 | ' | ' | ' | ' |
Number of extension option | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 |
Extended term of lease | ' | ' | ' | '5 years | ' | '5 years | ' | ' | ' | ' | ' |
Annual rent | ' | ' | ' | $2,600,000 | ' | $4,000,000 | ' | ' | ' | ' | ' |
Annual rent increase percentage | ' | ' | ' | 3.75% | ' | ' | 3.75% | ' | ' | ' | ' |
Number of securities purchased under securities repurchase program | ' | ' | ' | ' | ' | ' | ' | ' | 110,988 | ' | ' |
Purchase of treasury stock, amount | $52,662,000 | $3,000,000 | $7,000,000 | ' | ' | ' | ' | $52,700,000 | $3,000,000 | ' | ' |
Stock repurchase program average price per share | ' | ' | ' | ' | ' | ' | ' | ' | $27.03 | ' | ' |
Variable_Interest_Entities_Det
Variable Interest Entities (Details) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2013 |
Variable Interest Entity, Primary Beneficiary | Variable Interest Entity, Primary Beneficiary | Variable Interest Entity, Primary Beneficiary | New Mexico Data Center | New Mexico Data Center | |
Variable Interest Entity [Line Items] | ' | ' | ' | ' | ' |
Variable interest entity, total assets | ' | $1.40 | $6.90 | ' | ' |
Variable interest entity, total liabilities | ' | 1.1 | 6.6 | ' | ' |
Variable interest entity, initial cash infusion | 0.3 | ' | ' | ' | ' |
Variable interest entity, proceeds received by Entity health plans | ' | 0.2 | ' | ' | ' |
Tax credit claimed as a percentage of original investment amount | ' | ' | ' | 39.00% | ' |
Tax credit claimed, term | ' | ' | ' | '7 years | ' |
Percentage of credit claimed for first three years | ' | ' | ' | 5.00% | ' |
Percentage of credit claimed for remaining four years | ' | ' | ' | 6.00% | ' |
Capital contribution by related party | ' | ' | ' | 5.9 | ' |
Principal amount of loan by party | ' | ' | ' | 15.5 | ' |
Deferred finance costs, gross | ' | ' | ' | 1.2 | ' |
Proceeds from other debt | ' | ' | ' | $20.90 | $5.90 |
Percentage recapture for period of seven years as provided in Internal Revenue Code | ' | ' | ' | 100.00% | ' |
Commitments_and_Contingencies_2
Commitments and Contingencies (Details) (USD $) | 0 Months Ended | 12 Months Ended | 3 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||
Feb. 17, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2012 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2009 | Dec. 31, 2009 | Dec. 31, 2009 | Jan. 02, 2014 | |
Molina Health Care Insurance Company | June 2013 Transactions | June 2013 Transactions | Construction in Progress | Minimum | Maximum | California Department of Health Care Services | Executive Officer | Executive Officer | Executive Officer | Executive Officer | Executive Officer | Subsequent Event | |||||
Lease_Renewal_Option | February 2013 Transactions | Lease_Renewal_Option | Lease_Renewal_Option | California | Employment Contracts | Employment Contracts | Employment Contracts | Employment Contracts | Employment Contracts | California Department of Health Care Services | |||||||
Lease_Renewal_Option | Minimum | Maximum | California | ||||||||||||||
Sale Leaseback Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sale leaseback lease term (in years) | ' | ' | ' | ' | ' | '25 years | '25 years | '11 years 6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of lease renewal options | ' | ' | ' | ' | ' | 5 | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Lease renewal terms (in years) | ' | ' | ' | ' | ' | '5 years | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating lease terms (in years) | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | '10 years | ' | ' | ' | ' | ' | ' | ' |
Operating lease renewal options | ' | ' | ' | ' | ' | ' | ' | ' | 1 | 2 | ' | ' | ' | ' | ' | ' | ' |
Rental expense related to leases | ' | $24,500,000 | $20,500,000 | $23,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Employment agreements terms | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | '3 years | ' |
Automatically extension term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' |
Period of employment agreements | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | '1 year | ' | ' | ' | ' |
Contract terms with DHCS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' |
The initial balance established for the settlement account | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 |
Threshold percentage of plan's pre-tax margin for settlement amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.25% | ' | ' | ' | ' | ' | ' |
Settlement amount based on percentage of plan's revenue in 2014 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 75.00% | ' | ' | ' | ' | ' | ' |
Settlement amount based on percentage of plan's revenue after 2014 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' |
Maximum alternative minimum payment upon expiration of the settlement agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 40,000,000 | ' | ' | ' | ' | ' | ' |
Percent of pre-tax income on plan deducted from maximum alternative minimum payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' |
Percent of pre-tax margin threshold not subject to alternative minimum payment calculations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.00% | ' | ' | ' | ' | ' | ' |
Net assets of subsidiaries subject to restrictions | ' | 608,000,000 | 550,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and investments | ' | 365,200,000 | 46,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate statutory capital and surplus | ' | 662,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Required minimum statutory capital surplus | ' | 389,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated assessment fees in 2014 | ' | 85,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of financial responsibility ceded | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain (loss) on disposition of stock in subsidiary | ' | ' | ' | ' | $1,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Commitments_and_Contingencies_3
Commitments and Contingencies Future Minimum Lease Payments (Details) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Summary of future minimum lease payments | ' |
2014 | $43,512 |
2015 | 41,473 |
2016 | 34,767 |
2017 | 33,930 |
2018 | 32,969 |
Thereafter | 399,382 |
Total minimum lease payments | 586,033 |
Lease Financing Obligations | ' |
Summary of future minimum lease payments | ' |
2014 | 11,065 |
2015 | 11,397 |
2016 | 11,739 |
2017 | 12,091 |
2018 | 12,454 |
Thereafter | 333,275 |
Total minimum lease payments | 392,021 |
Lease Financing Obligations - Related Party | ' |
Summary of future minimum lease payments | ' |
2014 | 3,330 |
2015 | 6,880 |
2016 | 7,138 |
2017 | 7,405 |
2018 | 7,683 |
Thereafter | 52,538 |
Total minimum lease payments | 84,974 |
Operating Leases | ' |
Summary of future minimum lease payments | ' |
2014 | 29,117 |
2015 | 23,196 |
2016 | 15,890 |
2017 | 14,434 |
2018 | 12,832 |
Thereafter | 13,569 |
Total minimum lease payments | $109,038 |
Segment_Information_Schedule_o
Segment Information - Schedule of Operating Segment Information (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||||||||
Segment | |||||||||||||||||||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Number of reportable segments | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ||||||||
Health Plans: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | $1,595,352 | [1] | $1,584,656 | [1] | $1,501,729 | [1],[2] | $1,497,433 | [1],[3] | $1,477,384 | [1] | $1,448,600 | [1] | $1,392,774 | [1] | $1,225,363 | [1],[3] | $6,179,170 | $5,544,121 | $4,211,493 |
Premium tax revenue | ' | ' | ' | ' | ' | ' | ' | ' | 172,017 | 158,991 | 154,589 | ||||||||
Investment income | ' | ' | ' | ' | ' | ' | ' | ' | 6,890 | 5,075 | 5,446 | ||||||||
Rental income and other revenue | ' | ' | ' | ' | ' | ' | ' | ' | 26,322 | 18,312 | 8,288 | ||||||||
Molina Medicaid Solutions segment: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Service revenue | 54,007 | 51,100 | 49,672 | [2] | 49,756 | [3] | 55,359 | 48,422 | 41,724 | 42,205 | [3] | 204,535 | 187,710 | 160,447 | |||||
Revenue | ' | ' | ' | ' | ' | ' | ' | ' | 6,588,934 | 5,914,209 | 4,540,263 | ||||||||
Depreciation and amortization reported in the consolidated statements of cash flows: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 93,866 | 78,764 | 74,383 | ||||||||
Operating income from continuing operations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Operating income | ' | ' | ' | ' | ' | ' | ' | ' | 136,560 | 41,093 | 135,821 | ||||||||
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | 52,071 | 16,769 | 15,519 | ||||||||
Other expense, net | ' | ' | ' | ' | ' | ' | ' | ' | 3,343 | 945 | 0 | ||||||||
Income before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 81,146 | 23,379 | 120,302 | ||||||||
Goodwill and intangible assets, net: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Goodwill and intangible assets, net | 329,609 | ' | ' | ' | 228,799 | ' | ' | ' | 329,609 | 228,799 | 255,750 | ||||||||
Total assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Total assets | 3,002,937 | ' | ' | ' | 1,934,822 | ' | ' | ' | 3,002,937 | 1,934,822 | 1,652,146 | ||||||||
Health Plans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Health Plans: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 6,179,170 | 5,544,121 | 4,211,493 | ||||||||
Investment income | ' | ' | ' | ' | ' | ' | ' | ' | 6,890 | 5,075 | 5,446 | ||||||||
Rental income and other revenue | ' | ' | ' | ' | ' | ' | ' | ' | 26,322 | 18,312 | 8,288 | ||||||||
Depreciation and amortization reported in the consolidated statements of cash flows: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 67,446 | 58,577 | 45,734 | ||||||||
Operating income from continuing operations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Operating income | -14,669 | 16,929 | 40,151 | [2] | 61,520 | [3] | 51,323 | -5,788 | -56,072 | 27,903 | [3] | 103,931 | 17,366 | 133,758 | |||||
Goodwill and intangible assets, net: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Goodwill and intangible assets, net | 248,562 | ' | ' | ' | 139,710 | ' | ' | ' | 248,562 | 139,710 | 159,963 | ||||||||
Total assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Total assets | 2,809,439 | ' | ' | ' | 1,702,212 | ' | ' | ' | 2,809,439 | 1,702,212 | 1,429,283 | ||||||||
Molina Medicaid Solutions Segment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Molina Medicaid Solutions segment: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Service revenue | ' | ' | ' | ' | ' | ' | ' | ' | 204,535 | 187,710 | 160,447 | ||||||||
Depreciation and amortization reported in the consolidated statements of cash flows: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 26,420 | 20,187 | 28,649 | ||||||||
Operating income from continuing operations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Operating income | 11,984 | 7,997 | 6,295 | [2] | 6,353 | [3] | 520 | 8,156 | 6,642 | 8,409 | [3] | 32,629 | 23,727 | 2,063 | |||||
Goodwill and intangible assets, net: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Goodwill and intangible assets, net | 81,047 | ' | ' | ' | 89,089 | ' | ' | ' | 81,047 | 89,089 | 95,787 | ||||||||
Total assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Total assets | $193,498 | ' | ' | ' | $232,610 | ' | ' | ' | $193,498 | $232,610 | $222,863 | ||||||||
[1] | Prior to the third quarter of 2013, premium tax revenue was included in premium revenue. The presentation change reduced premium revenue for the amount now reported as premium tax revenue. In connection with this presentation change, amounts differ from the amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue reported for the quarter ended March 31, 2013 and 2012 decreased $37.0 million and $43.4 million, respectively; premium revenue reported for the quarter ended June 30, 2013 and 2012 decreased $46.9 million and $39.6 million, respectively. | ||||||||||||||||||
[2] | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | ||||||||||||||||||
[3] | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. |
Quarterly_Results_of_Operation2
Quarterly Results of Operations (Unaudited) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||||||||
Summary of quarterly results of operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | $1,595,352,000 | [1] | $1,584,656,000 | [1] | $1,501,729,000 | [1],[2] | $1,497,433,000 | [1],[3] | $1,477,384,000 | [1] | $1,448,600,000 | [1] | $1,392,774,000 | [1] | $1,225,363,000 | [1],[3] | $6,179,170,000 | $5,544,121,000 | $4,211,493,000 |
Service revenue | 54,007,000 | 51,100,000 | 49,672,000 | [2] | 49,756,000 | [3] | 55,359,000 | 48,422,000 | 41,724,000 | 42,205,000 | [3] | 204,535,000 | 187,710,000 | 160,447,000 | |||||
Operating (loss) income | ' | ' | ' | ' | ' | ' | ' | ' | 136,560,000 | 41,093,000 | 135,821,000 | ||||||||
Income (loss) from continuing operations | -9,041,000 | 7,553,000 | 15,796,000 | [2] | 30,522,000 | [3] | 26,194,000 | -165,000 | -33,057,000 | 19,894,000 | [3] | 44,830,000 | 12,866,000 | 77,388,000 | |||||
Income (loss) from discontinued operations, net of tax (benefit) expense of $(9,912), $(1,238), and $922, respectively | -85,000 | 16,000 | 8,775,000 | [2] | -607,000 | [3] | -551,000 | 3,529,000 | -4,249,000 | -1,805,000 | [3] | 8,099,000 | -3,076,000 | -56,570,000 | |||||
Net income | -9,126,000 | 7,569,000 | 24,571,000 | [2] | 29,915,000 | [3] | 25,643,000 | 3,364,000 | -37,306,000 | 18,089,000 | [3] | 52,929,000 | 9,790,000 | 20,818,000 | |||||
Basic income per share: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Basic | ($0.20) | [4] | $0.17 | [4] | $0.54 | [2],[4] | $0.65 | [3],[4] | $0.55 | [4] | $0.07 | [4] | ($0.80) | [4] | $0.39 | [3],[4] | $1.16 | $0.21 | $0.45 |
Diluted | ($0.20) | [4] | $0.16 | [4] | $0.53 | [2],[4] | $0.64 | [3],[4] | $0.54 | [4] | $0.07 | [4] | ($0.80) | [4] | $0.39 | [3],[4] | $1.13 | $0.21 | $0.45 |
Health Plans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summary of quarterly results of operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | 6,179,170,000 | 5,544,121,000 | 4,211,493,000 | ||||||||
Operating (loss) income | -14,669,000 | 16,929,000 | 40,151,000 | [2] | 61,520,000 | [3] | 51,323,000 | -5,788,000 | -56,072,000 | 27,903,000 | [3] | 103,931,000 | 17,366,000 | 133,758,000 | |||||
Molina Medicaid Solutions Segment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summary of quarterly results of operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Service revenue | ' | ' | ' | ' | ' | ' | ' | ' | 204,535,000 | 187,710,000 | 160,447,000 | ||||||||
Operating (loss) income | 11,984,000 | 7,997,000 | 6,295,000 | [2] | 6,353,000 | [3] | 520,000 | 8,156,000 | 6,642,000 | 8,409,000 | [3] | 32,629,000 | 23,727,000 | 2,063,000 | |||||
Contract Terminated | Restatement Adjustment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summary of quarterly results of operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | -200,000 | ' | ' | ' | -56,600,000 | ' | ' | ' | ||||||||
Operating (loss) income | ' | ' | ' | -800,000 | ' | ' | ' | -2,900,000 | ' | ' | ' | ||||||||
Change in Presentation | Restatement Adjustment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summary of quarterly results of operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | -46,900,000 | -37,000,000 | ' | ' | -39,600,000 | -43,400,000 | ' | ' | ' | ||||||||
Missouri | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summary of Quarterly Results of Operations [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Tax benefit from stock abandon | ' | ' | 9,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Summary of quarterly results of operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Premium revenue | ' | ' | ' | ' | ' | ' | ' | ' | $200,000 | $114,400,000 | $229,600,000 | ||||||||
[1] | Prior to the third quarter of 2013, premium tax revenue was included in premium revenue. The presentation change reduced premium revenue for the amount now reported as premium tax revenue. In connection with this presentation change, amounts differ from the amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue reported for the quarter ended March 31, 2013 and 2012 decreased $37.0 million and $43.4 million, respectively; premium revenue reported for the quarter ended June 30, 2013 and 2012 decreased $46.9 million and $39.6 million, respectively. | ||||||||||||||||||
[2] | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | ||||||||||||||||||
[3] | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. | ||||||||||||||||||
[4] | Potentially dilutive shares issuable pursuant to our 1.125% Warrants were not included in the computation of diluted net income per share for all quarters in 2013, because to do so would have been anti-dilutive. Potentially dilutive shares issuable pursuant to our 3.75% Notes were not included in the computation of diluted net income per share for the quarters ended March 31, 2013, June 30, 2013, and all quarters in 2012, because to do so would have been anti-dilutive. |
Condensed_Financial_Informatio2
Condensed Financial Information of Registrant Condensed Balance Sheets (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
In Thousands, unless otherwise specified | ||||
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | $935,895 | $795,770 | $493,827 | $455,886 |
Investments | 703,052 | 342,845 | ' | ' |
Income tax refundable | 32,742 | 0 | ' | ' |
Deferred income taxes | 26,556 | 32,443 | ' | ' |
Total current assets | 2,039,664 | 1,349,126 | ' | ' |
Property and equipment, net | 292,083 | 221,443 | ' | ' |
Derivative asset | 186,351 | 0 | ' | ' |
Total assets | 3,002,937 | 1,934,822 | 1,652,146 | ' |
Current liabilities: | ' | ' | ' | ' |
Long-term debt | 598,240 | ' | ' | ' |
Deferred income taxes | 580 | 37,900 | ' | ' |
Derivative liability | 186,239 | 1,307 | ' | ' |
Other long-term liabilities | 26,351 | 23,480 | ' | ' |
Total liabilities | 2,110,000 | 1,152,508 | ' | ' |
Stockholders' equity: | ' | ' | ' | ' |
Preferred stock, $0.001 par value; 20,000 shares authorized, no shares issued and outstanding | 0 | 0 | ' | ' |
Accumulated other comprehensive loss | -1,086 | -457 | ' | ' |
Treasury stock, at cost; outstanding: 111 shares at December 31, 2012 | 0 | -3,000 | ' | ' |
Retained earnings | 553,129 | 500,200 | ' | ' |
Total stockholders’ equity | 892,937 | 782,314 | ' | ' |
Total liabilities and stockholders' equity | 3,002,937 | 1,934,822 | ' | ' |
Parent Company | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 99,698 | 39,068 | 14,650 | 57,020 |
Investments | 262,665 | 2,015 | ' | ' |
Income tax refundable | 8,403 | 8,868 | ' | ' |
Deferred income taxes | 10,073 | 9,706 | ' | ' |
Due from affiliates | 35,928 | 55,382 | ' | ' |
Prepaid and other current assets | 28,387 | 19,164 | ' | ' |
Total current assets | 445,154 | 134,203 | ' | ' |
Property and equipment, net | 225,522 | 108,808 | ' | ' |
Goodwill and intangible assets, net | 68,902 | 52,302 | ' | ' |
Investments in subsidiaries | 992,998 | 768,765 | ' | ' |
Deferred income taxes | 17,245 | 0 | ' | ' |
Derivative asset | 186,351 | 0 | ' | ' |
Advances to related parties and other assets | 52,615 | 38,215 | ' | ' |
Total assets | 1,988,787 | 1,102,293 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable and accrued liabilities | 109,388 | 73,883 | ' | ' |
Long-term debt | 784,862 | 215,468 | ' | ' |
Deferred income taxes | 0 | 17,122 | ' | ' |
Derivative liability | 186,239 | 0 | ' | ' |
Other long-term liabilities | 15,361 | 13,506 | ' | ' |
Total liabilities | 1,095,850 | 319,979 | ' | ' |
Stockholders' equity: | ' | ' | ' | ' |
Common stock, $0.001 par value; 150,000 shares authorized; outstanding: 45,871 shares at December 31, 2013 and 46,762 shares at December 31, 2012 | 46 | 47 | ' | ' |
Preferred stock, $0.001 par value; 20,000 shares authorized, no shares issued and outstanding | 0 | 0 | ' | ' |
Paid-in capital | 340,848 | 285,524 | ' | ' |
Accumulated other comprehensive loss | -1,086 | -457 | ' | ' |
Treasury stock, at cost; outstanding: 111 shares at December 31, 2012 | 0 | -3,000 | ' | ' |
Retained earnings | 553,129 | 500,200 | ' | ' |
Total stockholders’ equity | 892,937 | 782,314 | ' | ' |
Total liabilities and stockholders' equity | $1,988,787 | $1,102,293 | ' | ' |
Condensed_Financial_Informatio3
Condensed Financial Information of Registrant Condensed Statements of Income (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||
Revenue from continuing operations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Total revenue | ' | ' | ' | ' | ' | ' | ' | ' | $6,588,934 | $5,914,209 | $4,540,263 | |||
Expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
General and administrative expenses | ' | ' | ' | ' | ' | ' | ' | ' | 665,996 | 518,615 | 393,452 | |||
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 72,743 | 63,114 | 48,253 | |||
Operating income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 136,560 | 41,093 | 135,821 | |||
Other expense, net | ' | ' | ' | ' | ' | ' | ' | ' | 3,343 | 945 | 0 | |||
Income tax benefit | ' | ' | ' | ' | ' | ' | ' | ' | 36,316 | 10,513 | 42,914 | |||
Net income | -9,126 | 7,569 | 24,571 | [1] | 29,915 | [2] | 25,643 | 3,364 | -37,306 | 18,089 | [2] | 52,929 | 9,790 | 20,818 |
Parent Company | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Revenue from continuing operations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Management fees and other operating revenue | ' | ' | ' | ' | ' | ' | ' | ' | 599,049 | 406,981 | 308,287 | |||
Investment income | ' | ' | ' | ' | ' | ' | ' | ' | 2,768 | 550 | 81 | |||
Total revenue | ' | ' | ' | ' | ' | ' | ' | ' | 601,817 | 407,531 | 308,368 | |||
Expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Medical care costs | ' | ' | ' | ' | ' | ' | ' | ' | 37,862 | 33,102 | 31,672 | |||
General and administrative expenses | ' | ' | ' | ' | ' | ' | ' | ' | 503,781 | 367,606 | 272,302 | |||
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 51,562 | 38,794 | 31,355 | |||
Total expenses | ' | ' | ' | ' | ' | ' | ' | ' | 593,205 | 439,502 | 335,329 | |||
Operating income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 8,612 | -31,971 | -26,961 | |||
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | 50,508 | 14,469 | 14,958 | |||
Other expense, net | ' | ' | ' | ' | ' | ' | ' | ' | 3,811 | 0 | 0 | |||
Loss before income taxes and equity in net income of subsidiaries | ' | ' | ' | ' | ' | ' | ' | ' | -45,707 | -46,440 | -41,919 | |||
Income tax benefit | ' | ' | ' | ' | ' | ' | ' | ' | -15,455 | -15,779 | -14,826 | |||
Net loss before equity in net income of subsidiaries | ' | ' | ' | ' | ' | ' | ' | ' | -30,252 | -30,661 | -27,093 | |||
Equity in net income of subsidiaries | ' | ' | ' | ' | ' | ' | ' | ' | 83,181 | 40,451 | 47,911 | |||
Net income | ' | ' | ' | ' | ' | ' | ' | ' | $52,929 | $9,790 | $20,818 | |||
[1] | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | |||||||||||||
[2] | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. |
Condensed_Financial_Informatio4
Condensed Financial Information of Registrant Condensed Statements of Comprehensive Income (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Net income | ($9,126) | $7,569 | $24,571 | [1] | $29,915 | [2] | $25,643 | $3,364 | ($37,306) | $18,089 | [2] | $52,929 | $9,790 | $20,818 |
Gross unrealized investment (loss) gain | ' | ' | ' | ' | ' | ' | ' | ' | -1,015 | 1,529 | 1,167 | |||
Effect of income tax (benefit) expense | ' | ' | ' | ' | ' | ' | ' | ' | -386 | 581 | 380 | |||
Other comprehensive (loss) income, net of tax | ' | ' | ' | ' | ' | ' | ' | ' | -629 | 948 | 787 | |||
Comprehensive income | ' | ' | ' | ' | ' | ' | ' | ' | 52,300 | 10,738 | 21,605 | |||
Parent Company | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Net income | ' | ' | ' | ' | ' | ' | ' | ' | 52,929 | 9,790 | 20,818 | |||
Gross unrealized investment (loss) gain | ' | ' | ' | ' | ' | ' | ' | ' | -1,015 | 1,529 | 1,167 | |||
Effect of income tax (benefit) expense | ' | ' | ' | ' | ' | ' | ' | ' | -386 | 581 | 380 | |||
Other comprehensive (loss) income, net of tax | ' | ' | ' | ' | ' | ' | ' | ' | -629 | 948 | 787 | |||
Comprehensive income | ' | ' | ' | ' | ' | ' | ' | ' | $52,300 | $10,738 | $21,605 | |||
[1] | We abandoned our equity interests in the Missouri health plan during the second quarter of 2013, resulting in the recognition of a tax benefit of $9.5 million, which is included in (loss) income from discontinued operations. | |||||||||||||
[2] | In connection with the reclassification of Missouri health plan results to discontinued operations, amounts differ from amounts previously reported in our Quarterly Reports on Form 10-Q as follows: premium revenue for the quarters ended March 31, 2013 and 2012 decreased $0.2 million and $56.6 million, respectively; operating income, Health Plans segment, for the quarters ended March 31, 2013 and 2012 decreased $0.8 million and $2.9 million, respectively. |
Condensed_Financial_Informatio5
Condensed Financial Information of Registrant Condensed Statements of Cash Flows (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Operating activities: | ' | ' | ' |
Net cash provided by operating activities | $190,083 | $347,784 | $225,395 |
Investing activities: | ' | ' | ' |
Net cash used in investing activities | -543,311 | -93,584 | -236,927 |
Financing activities: | ' | ' | ' |
Proceeds from issuance of 1.125% Notes, net of deferred issuance costs | 537,973 | 0 | 0 |
Proceeds from sale-leaseback transactions | 158,694 | 0 | 0 |
Purchase of 1.125% Notes call option | -149,331 | 0 | 0 |
Proceeds from issuance of warrants | 75,074 | 0 | 0 |
Treasury stock purchases | -52,662 | -3,000 | -7,000 |
Principal payment on term loan of subsidiary | -47,471 | -1,129 | 0 |
Repayment of amount borrowed under credit facility | -40,000 | -20,000 | 0 |
Proceeds from exercise of stock options and employee stock plan purchases | 9,402 | 8,205 | 7,347 |
Excess tax benefits from employee stock compensation | 1,674 | 3,667 | 1,651 |
Amount borrowed under credit facility | 0 | 60,000 | 0 |
Net cash provided by financing activities | 493,353 | 47,743 | 49,473 |
Net (decrease) increase in cash and cash equivalents | 140,125 | 301,943 | 37,941 |
Cash and cash equivalents at beginning of period | 795,770 | 493,827 | 455,886 |
Cash and cash equivalents at end of period | 935,895 | 795,770 | 493,827 |
Parent Company | ' | ' | ' |
Operating activities: | ' | ' | ' |
Net cash provided by operating activities | 62,602 | 20,611 | 28,606 |
Investing activities: | ' | ' | ' |
Capital contributions to subsidiaries | -166,112 | -100,221 | -58,412 |
Dividends received from subsidiaries | 24,429 | 101,800 | 86,284 |
Purchases of investments | -362,927 | -1,905 | -2,020 |
Sales and maturities of investments | 97,713 | 4,067 | 3,760 |
Proceeds from sale of subsidiary, net of cash surrendered | 0 | 9,162 | 0 |
Purchases of equipment | -76,873 | -61,813 | -30,930 |
Changes in amounts due to and due from affiliates | -5,888 | 5,187 | -50,090 |
Change in other assets and liabilities | -6,175 | -1,342 | -20,441 |
Net cash used in investing activities | -495,833 | -45,065 | -71,849 |
Financing activities: | ' | ' | ' |
Proceeds from issuance of 1.125% Notes, net of deferred issuance costs | 537,973 | 0 | 0 |
Proceeds from sale-leaseback transactions | 158,694 | 0 | 0 |
Purchase of 1.125% Notes call option | -149,331 | 0 | 0 |
Proceeds from issuance of warrants | 75,074 | 0 | 0 |
Treasury stock purchases | -52,662 | -3,000 | -7,000 |
Principal payment on term loan of subsidiary | -46,963 | 0 | 0 |
Payment of credit facility fees | 0 | 0 | -1,125 |
Repayment of amount borrowed under credit facility | -40,000 | -20,000 | 0 |
Proceeds from exercise of stock options and employee stock plan purchases | 9,402 | 8,205 | 7,347 |
Excess tax benefits from employee stock compensation | 1,674 | 3,667 | 1,651 |
Amount borrowed under credit facility | 0 | 60,000 | 0 |
Net cash provided by financing activities | 493,861 | 48,872 | 873 |
Net (decrease) increase in cash and cash equivalents | 60,630 | 24,418 | -42,370 |
Cash and cash equivalents at beginning of period | 39,068 | 14,650 | 57,020 |
Cash and cash equivalents at end of period | $99,698 | $39,068 | $14,650 |
Condensed_Financial_Informatio6
Condensed Financial Information of Registrant Parenthetical (Details) (USD $) | Dec. 31, 2013 | 1-May-13 | Apr. 30, 2013 | Dec. 31, 2012 |
Common Stock, Par or Stated Value Per Share | $0.00 | ' | ' | $0.00 |
Common stock, shares authorized | 150,000,000 | 150,000,000 | 80,000,000 | 150,000,000 |
Common Stock, Shares, Outstanding | 45,871,000 | ' | ' | 46,762,000 |
Preferred Stock, Par or Stated Value Per Share | $0.00 | ' | ' | $0.00 |
Preferred Stock, Shares Authorized | 20,000,000 | ' | ' | 20,000,000 |
Preferred Stock, Shares Issued | 0 | ' | ' | 0 |
Preferred Stock, Shares Outstanding | 0 | ' | ' | 0 |
Treasury stock, shares | ' | ' | ' | 111,000 |
Parent Company | ' | ' | ' | ' |
Common Stock, Par or Stated Value Per Share | $0.00 | ' | ' | $0.00 |
Common stock, shares authorized | 150,000,000 | ' | ' | 150,000,000 |
Common Stock, Shares, Outstanding | 45,871,000 | ' | ' | 46,762,000 |
Preferred Stock, Par or Stated Value Per Share | $0.00 | ' | ' | $0.00 |
Preferred Stock, Shares Authorized | 20,000,000 | ' | ' | 20,000,000 |
Preferred Stock, Shares Issued | 0 | ' | ' | 0 |
Preferred Stock, Shares Outstanding | 0 | ' | ' | 0 |
Treasury stock, shares | ' | ' | ' | 111,000 |
Condensed_Financial_Informatio7
Condensed Financial Information of Registrant Notes to Condensed Financial Information (Details) (Parent Company, USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Parent Company | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Services revenue from subsidiaries | $592.10 | $406.40 | $307.90 |
Subsidiary repaid a surplus note | ' | ' | $9.70 |