Humana 2013 Annual Report Download - page 15

Our Products
Our medical and specialty insurance products allow members to access health care services primarily
through our networks of health care providers with whom we have contracted. These products may vary in the
degree to which members have coverage. Health maintenance organizations, or HMOs, generally require a
referral from the member’s primary care provider before seeing certain specialty physicians. Preferred provider
organizations, or PPOs, provide members the freedom to choose a health care provider without requiring a
referral. However PPOs generally require the member to pay a greater portion of the provider’s fee in the event
the member chooses not to use a provider participating in the PPO’s network. Point of Service, or POS, plans
combine the advantages of HMO plans with the flexibility of PPO plans. In general, POS plans allow members to
choose, at the time medical services are needed, to seek care from a provider within the plan’s network or outside
the network. In addition, we offer services to our health plan members as well as to third parties that promote
health and wellness, including pharmacy, provider services, integrated wellness, and home based services. At the
core of our strategy is our integrated care delivery model, which unites quality care, high member engagement,
and sophisticated data analytics. Our approach to primary, physician-directed care for our members aims to
provide quality care that is consistent, integrated, cost-effective, and member-focused. The model is designed to
improve health outcomes and affordability for individuals and for the health system as a whole, while offering
our members a simple, seamless healthcare experience. The discussion that follows describes the products
offered by each of our segments.
Our Retail Segment Products
This segment is comprised of products sold on a retail basis to individuals including medical and
supplemental benefit plans described in the discussion that follows. The following table presents our premiums
and services revenue for the Retail segment by product for the year ended December 31, 2013:
Retail Segment
Premiums and
Services Revenue
Percent of
Consolidated
Premiums and
Services Revenue
(dollars in millions)
Premiums:
Individual Medicare Advantage ................ $22,481 54.9%
Medicare stand-alone PDP .................... 3,025 7.4%
Total Retail Medicare ................... 25,506 62.3%
Individual commercial ....................... 1,160 2.8%
State-based Medicaid ........................ 328 0.8%
Individual specialty ......................... 210 0.5%
Total premiums ........................ 27,204 66.4%
Services ...................................... 16 0.1%
Total premiums and services revenue ....... $27,220 66.5%
Individual Medicare
We have participated in the Medicare program for private health plans for over 30 years and have
established a national presence, offering at least one type of Medicare plan in all 50 states. We have a
geographically diverse membership base that we believe provides us with greater ability to expand our network
of PPO and HMO providers. We employ strategies including health assessments and clinical guidance programs
such as lifestyle and fitness programs for seniors to guide Medicare beneficiaries in making cost-effective
decisions with respect to their health care. We believe these strategies result in cost savings that occur from
making positive behavior changes.
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