Humana 2006 Annual Report Download - page 89

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Humana Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
accelerated the depreciation of the remaining software balance. The change in the useful life increased
depreciation expense during 2004 by approximately $9.3 million ($5.7 million after tax), all of which was
allocated to the Commercial segment.
7. GOODWILL AND OTHER INTANGIBLE ASSETS
Changes in the carrying amount of goodwill, by operating segment, for the year ended December 31, 2006
were as follows:
Commercial Government Total
(in thousands)
Balance at December 31, 2005 .................................. $741,260 $523,315 $1,264,575
CHA acquisition ......................................... 39,912 — 39,912
Contingent purchase price settlements related to:
Prior years acquisitions ................................ 1,329 4,815 6,144
Balance at December 31, 2006 .................................. $782,501 $528,130 $1,310,631
Other intangible assets primarily relate to acquired subscriber contracts and are included with other long-
term assets in the consolidated balance sheets. Amortization expense for other intangible assets was
approximately $20.0 million in 2006, $23.8 million in 2005 and $10.5 million in 2004. The following table
presents our estimate of amortization expense for each of the five next succeeding fiscal years:
(in thousands)
For the years ending December 31,:
2007 ...................................................... $16,989
2008 ...................................................... $14,076
2009 ...................................................... $10,096
2010 ...................................................... $ 9,511
2011 ...................................................... $ 9,440
The following table presents details of our other intangible assets included in other non-current assets in the
accompanying consolidated balance sheets at December 31, 2006 and 2005:
Weighted
Average
Life
2006 2005
Cost
Accumulated
Amortization Net Cost
Accumulated
Amortization Net
(in thousands)
Other intangible assets:
Subscriber contracts ........ 10.2 yrs $114,944 $36,449 $78,495 $103,251 $18,483 $ 84,768
Provider contracts .......... 14.5 yrs 11,500 2,012 9,488 10,300 1,202 9,098
Licenses and other ......... 16.7 yrs 11,602 3,929 7,673 12,890 2,741 10,149
Total other intangible
assets .............. 11.0 yrs $138,046 $42,390 $95,656 $126,441 $22,426 $104,015
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