Humana 2010 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 Care Effectiveness Data and Information Sets, or HEDIS, which is used by employers, government
purchasers and the National Committee for Quality Assurance, or NCQA, to evaluate health plans based on
various criteria, including effectiveness of care and member satisfaction.
Physicians participating in our 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.
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 health plans and/or departments from NCQA, the Accreditation
Association for Ambulatory Health Care, and the Utilization Review Accreditation Commission, or URAC.
Accreditation or external review by an approved organization is mandatory in the states of Florida and Kansas for
licensure as an HMO. 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 our compliance with standards for quality improvement, credentialing,
utilization management, member connections, and member rights and responsibilities. We have achieved and
maintained NCQA accreditation in all of our commercial, Medicare and Medicaid HMO/POS markets with
enough history and membership, except Puerto Rico, and for many of our 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, 2010, we employed approximately 1,800 sales representatives, as well as approximately
800 telemarketing representatives who assisted in the marketing of Medicare 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. Finally, we sell group Medicare Advantage products through large
employers, including via an alliance with CIGNA Corporation. Under the terms of the alliance, we and CIGNA
coordinate services and share financial results. 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
employer’s or group’s exclusive source of health insurance benefits by offering a variety of HMO, PPO, and
specialty products that provide cost-effective quality health care coverage consistent with the needs and
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