Humana 2008 Annual Report Download - page 24

Accreditation Assessment
Our accreditation assessment program consists of several internal programs, including those that credential
providers and those designed to meet the audit standards of federal and state agencies, as well as external
accreditation standards. We also offer quality and outcome measurement and improvement programs such as the
Health Plan Employer Data Information Sets, or HEDIS, which is used by employers, government purchasers
and the National Committee for Quality Assurance, or NCQA, to evaluate HMOs based on various criteria,
including effectiveness of care and member satisfaction.
Physicians participating in our HMO networks must satisfy specific criteria, including licensing, patient
access, office standards, after-hours coverage, and other factors. Most participating hospitals also meet
accreditation criteria established by CMS and/or the Joint Commission on Accreditation of Healthcare
Organizations, or JCAHO.
Recredentialing of participating providers occurs every two to three years, depending on applicable state
laws. Recredentialing of participating physicians includes verification of their medical licenses; review of their
malpractice liability claims histories; review of their board certifications, if applicable; and review of applicable
quality information. Committees, composed of a peer group of physicians, review the applications of physicians
being considered for credentialing and recredentialing.
We request accreditation for certain of our HMO plans from NCQA and the American Accreditation
Healthcare Commission, also known as the Utilization Review Accreditation Commission, or URAC. URAC
performs reviews for utilization management standards and for health plan and health network standards in
quality management, credentialing, rights and responsibilities, and network management. Accreditation or
external review by an approved organization is mandatory in the states of Florida and Kansas for licensure as an
HMO. Accreditation specific to the utilization review process also is required in the state of Georgia for licensure
as an HMO or PPO. Certain commercial businesses, like those impacted by a third-party labor agreement or
those where a request is made by the employer, may require or prefer accredited health plans.
NCQA performs reviews of standards for quality improvement, credentialing, utilization management, and
member rights and responsibilities. We have achieved and maintained NCQA accreditation in all of our
commercial HMO markets except Puerto Rico and in select PPO markets.
Sales and Marketing
We use various methods to market our Medicare, Medicaid, and commercial products, including television,
radio, the Internet, telemarketing, and direct mailings.
At December 31, 2008, we employed approximately 1,800 sales representatives, as well as approximately
800 telemarketing representatives who assisted in the marketing of Medicare and Medicaid products by making
appointments for sales representatives with prospective members. We also market our Medicare products via a
strategic alliance with Wal-Mart Stores, Inc., or Wal-Mart. This alliance includes stationing Humana
representatives in certain Wal-Mart stores, SAM’S CLUB locations, and Neighborhood Markets across the
country providing an opportunity to enroll Medicare eligible individuals in person. In addition, we market our
Medicare products through licensed independent brokers and agents including strategic alliances with State
Farm®and United Services Automobile Association, or USAA. Commissions paid to employed sales
representatives and independent brokers and agents are based on a per unit commission structure approved by
CMS.
Individuals become members of our commercial HMOs and PPOs through their employers or other groups
which typically offer employees or members a selection of health insurance products, pay for all or part of the
premiums, and make payroll deductions for any premiums payable by the employees. We attempt to become an
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