Humana 2013 Annual Report Download - page 163

Download and view the complete annual report

Please find page 163 of the 2013 Humana annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 168

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168

Humana Inc.
SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION
NOTES TO CONDENSED FINANCIAL STATEMENTS—(Continued)
Although minimum required levels of equity are largely based on premium volume, product mix, and the
quality of assets held, minimum requirements vary significantly at the state level. Our state regulated insurance
subsidiaries had aggregate statutory capital and surplus of approximately $5.5 billion and $5.1 billion as of
December 31, 2013 and 2012, respectively, which exceeded aggregate minimum regulatory requirements of
$3.5 billion and $3.4 billion, respectively. Excluding Puerto Rico subsidiaries, the amount of ordinary dividends
that may be paid to our parent company in 2014 is approximately $840 million in the aggregate. This compares
to dividends that were paid to our parent company in 2013 of approximately $967 million. However, actual
dividends paid from the subsidiaries to the parent in 2014 could be reduced as a result of the proposed statutory
accounting for the health insurance industry fee, discussed below, combined with higher surplus requirements
associated with premium growth due to increases in membership.
The NAIC is continuing discussions regarding the statutory accounting for the health insurance industry fee
required by the Health Care Reform Law which in its present form would restrict surplus in the year preceding
payment, beginning in 2014. Accordingly, in addition to recording the full-year 2014 assessment in the first
quarter of 2014, we may be required to restrict surplus for the 2015 assessment ratably in 2014. This proposal
does not affect our financial statements prepared in accordance with generally accepted accounting principles,
under which the fee is expensed ratably throughout the payment year.
4. ACQUISITIONS
Refer to Note 3 of the notes to consolidated financial statements in this Annual Report on Form 10-K for a
description of acquisitions. During 2013, we funded certain non-regulated subsidiary acquisitions, including the
acquisition of American Eldercare Inc., with contributions from Humana Inc., our parent company, of
approximately $181 million, included in capital contributions in the condensed statement of cash flows.
5. INCOME TAXES
Refer to Note 10 of the notes to consolidated financial statements in this Annual Report on Form 10-K for a
description of income taxes.
6. DEBT
Refer to Note 11 of the notes to consolidated financial statements in this Annual Report on Form 10-K for a
description of debt.
7. STOCKHOLDER’S EQUITY
Refer to Note 14 of the notes to consolidated financial statements in this Annual Report on Form 10-K for a
description of stockholders’ equity, including stock repurchases and stockholder dividends.
153