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advanced฀communication฀techniques,฀Personal฀Nurses฀are฀able฀to฀seize฀“moments฀of฀motivation”฀that฀help฀
change฀behavior฀and฀thus฀lead฀to฀the฀avoidance฀of฀costly฀and฀debilitating฀medical฀episodes฀–฀or,฀if฀necessary,฀
prepare฀members฀to฀enter฀the฀health฀care฀system฀confidently.฀Our฀sophisticated,฀patent-pending฀predictive฀
modeling฀techniques฀enable฀us฀to฀identify฀the฀“pre-sick”฀and฀connect฀them฀with฀a฀Personal฀Nurse฀in฀time฀for฀
effective฀intervention฀on฀both฀the฀cost฀and฀care฀sides฀of฀the฀health฀care฀equation.฀Ultimately,฀any฀improvement฀
we฀can฀suggest฀that฀results฀in฀members’฀changing฀unhealthy฀behavior฀improves฀their฀quality฀of฀life,฀builds฀
their฀knowledge฀and฀confidence฀as฀health฀consumers฀and฀reduces฀costs.฀
Innovations฀that฀deliver฀practical฀results
Another฀example฀of฀how฀Humana฀is฀unique฀is฀in฀our฀use฀of฀science฀to฀create฀innovations฀that฀deliver฀practical฀
results฀ to฀ our฀ customers.฀ ฀ While฀ most฀ health฀ insurance฀ companies฀ have฀ an฀ information฀ technology฀ (IT)฀
department,฀we฀approach฀technology฀as฀research฀and฀development฀(R&D),฀in฀the฀same฀way฀a฀biotechnology฀
company฀would.฀The฀difference฀is฀that฀while฀our฀investments฀in฀technology฀provide฀a฀baseline฀of฀cost฀savings฀
that฀every฀company฀expects,฀they฀go฀farther,฀underpinning฀our฀innovation฀platform฀and฀making฀total฀solutions฀
possible.฀฀Our฀technology฀platforms฀give฀our฀products฀the฀results-driven฀functionality฀that฀our฀customers฀and฀
members฀want.฀฀The฀recognition฀we’ve฀received฀from฀industry฀analysts฀and฀award฀programs฀provides฀important฀
third-party฀validation฀for฀our฀leadership฀in฀this฀area.฀We฀received฀an฀American฀Business฀Award฀in฀2003฀–฀a฀
“Stevie,”฀the฀Oscar฀of฀commerce฀–฀for฀leadership฀in฀engineering฀and฀product฀development;฀the฀Forrester฀Group฀
has฀named฀us฀the฀health-benefits฀leader฀in฀the฀growing฀consumer฀space;฀and฀Information฀Week฀magazine฀has฀
ranked฀us฀6th฀among฀companies฀in฀all฀industries฀for฀the฀sophistication฀and฀effectiveness฀of฀our฀approach฀to฀IT.
Consumer฀research฀and฀data฀analysis฀ are฀key฀elements฀of฀ using฀ technology฀ to฀ enable฀ R&D.฀ Through฀our฀
Center฀for฀Health฀Metrics,฀we฀mine฀data฀in฀ways฀that฀allow฀us฀to฀focus฀at฀the฀individual฀member฀level฀on฀
behavior฀modification.฀฀In฀the฀19th฀century,฀most฀people฀died฀because฀society฀didn’t฀have฀the฀ability฀to฀prevent฀
or฀cure฀disease.฀฀In฀the฀21st฀century,฀the฀major฀causes฀of฀disease฀include฀obesity,฀heart฀disease฀and฀diabetes,฀
each฀a฀condition฀that฀doctors฀can฀treat,฀cure฀or฀prevent.฀The฀key฀is฀to฀identify฀individuals฀whose฀health฀history฀
and฀lifestyle฀choices฀put฀them฀at฀risk฀for฀developing฀or฀worsening฀these฀conditions.฀Every฀time฀we฀identify฀
“pre-sick”฀individuals฀and฀intervene฀to฀suggest฀behavior฀change,฀we฀potentially฀ improve฀health฀and฀save฀
money฀for฀employees฀and฀their฀companies.
The฀investment฀in฀technology฀integration฀within฀Humana฀allows฀us฀to฀offer฀comprehensive฀products฀and฀
services฀that฀work฀effectively฀for฀our฀customers.
Long-term฀view฀in฀a฀short-term฀world
When฀these฀ three฀differentiating฀characteristics฀ are฀considered฀–฀our฀ consumer฀ orientation,฀ our฀solutions฀
focus฀and฀our฀use฀of฀innovation฀to฀drive฀practical฀results฀–฀they฀derive฀from฀the฀principle฀that฀in฀a฀short-term-
oriented฀world,฀we’re฀willing฀to฀take฀a฀long-term฀view.฀We’re฀not฀the฀largest฀company฀in฀the฀industry฀so฀we฀
can’t฀rely฀on฀sheer฀bulk฀to฀be฀successful.
One฀of฀the฀key฀lessons฀we฀learned฀from฀our฀longevity฀in฀the฀Medicare฀business฀is฀that฀it’s฀difficult฀to฀time฀
market฀cycles฀in฀the฀various฀parts฀of฀our฀businesses.฀฀By฀staying฀committed฀to฀businesses฀and฀products฀that฀
we฀believe฀are฀viable฀in฀the฀long฀term,฀we฀benefit฀as฀the฀market฀moves.฀Our฀diversification฀across฀segments฀
and฀products฀allows฀us฀to฀increase฀our฀opportunities฀for฀success.
2005:฀Diversified฀growth
We฀are฀optimistic฀about฀2005฀and฀confident฀about฀the฀growth฀goals฀we’ve฀set฀for฀the฀coming฀year.฀We฀have฀
greater฀visibility฀and฀stability฀than฀we’ve฀ever฀had฀in฀our฀Government฀segment.฀In฀our฀Commercial฀segment,฀
we฀anticipate฀the฀ continued฀portfolio฀migration฀to฀ASO฀ for฀our฀large฀customers฀ and฀more฀growth฀in฀the฀
individual฀HumanaOne฀product.฀In฀addition,฀we฀see฀continued฀progress฀for฀our฀high-margin฀Smart฀products,฀
including฀our฀new฀SmartExpress฀offering฀for฀groups฀of฀2฀to฀299฀employees.฀Although฀it’s฀too฀early฀to฀be฀
certain,฀we฀think฀we’re฀seeing฀the฀beginnings฀of฀a฀return฀to฀rational฀pricing฀in฀our฀commercial฀markets.฀We’re฀
also฀focusing฀on฀continued฀excellence฀in฀the฀daily฀execution฀and฀management฀of฀our฀existing฀businesses.฀฀
The฀smooth฀completion฀of฀our฀TRICARE฀ transition฀is฀typical฀of฀our฀management฀team’s฀ability฀to฀execute฀
effectively฀across฀multiple฀functions.฀