Supplemental Condensed Consolidating Financial Information (Tables)

9 Months Ended

Sep. 30, 2018

Condensed Financial Information [Abstract]

Condensed Consolidating Statements of Income

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

	Three Months Ended September 30, 2018
	Parent Guarantor			Other Guarantors			Non-Guarantors		Eliminations			Consolidated
	(In millions)
Revenue:
Total revenue	$	273		$	—		$	4,695	$	(271	)	$	4,697
Expenses:
Medical care costs	(11		)	—			3,801		—			3,790
Cost of service revenue	—			—			111		—			111
General and administrative expenses	243			1			338		(271		)	311
Premium tax expenses	—			—			110		—			110
Health insurer fees	—			—			87		—			87
Depreciation and amortization	17			—			8		—			25
Restructuring and separation costs	3			—			2		—			5
Total operating expenses	252			1			4,457		(271		)	4,439
Gain on sale of subsidiary	37			—			—		—			37
Operating income (loss)	58			(1		)	238		—			295
Interest expense	26			—			—		—			26
Other expenses, net	10			—			—		—			10
Income (loss) before income taxes	22			(1		)	238		—			259
Income tax (benefit) expense	(6		)	—			68		—			62
Net income (loss) before equity in net earnings (losses) of subsidiaries	28			(1		)	170		—			197
Equity in net earnings (losses) of subsidiaries	169			(2		)	—		(167		)	—
Net income (loss)	$	197		$	(3	)	$	170	$	(167	)	$	197

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

	Nine Months Ended September 30, 2018
	Parent Guarantor			Other Guarantors			Non-Guarantors		Eliminations			Consolidated
	(In millions)
Revenue:
Total revenue	$	867		$	2		$	14,220	$	(863	)	$	14,226
Expenses:
Medical care costs	(4		)	—			11,366		—			11,362
Cost of service revenue	—			—			349		—			349
General and administrative expenses	762			3			1,096		(863		)	998
Premium tax expenses	—			—			320		—			320
Health insurer fees	—			—			261		—			261
Depreciation and amortization	53			—			23		—			76
Restructuring and separation costs	28			—			10		—			38
Total operating expenses	839			3			13,425		(863		)	13,404
Gain on sale of subsidiary	37			—			—		—			37
Operating income (loss)	65			(1		)	795		—			859
Interest expense	90			—			1		—			91
Other expenses, net	25			—			—		—			25
(Loss) income before income taxes	(50		)	(1		)	794		—			743
Income tax expense	4			—			233		—			237
Net (loss) income before equity in net earnings (losses) of subsidiaries	(54		)	(1		)	561		—			506
Equity in net earnings (losses) of subsidiaries	560			(6		)	—		(554		)	—
Net income (loss)	$	506		$	(7	)	$	561	$	(554	)	$	506

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

	Nine Months Ended September 30, 2017
	Parent Guarantor			Other Guarantors			Non-Guarantors			Eliminations			Consolidated
	(In millions)
Revenue:
Total revenue	$	1,010		$	1		$	14,937		$	(1,014	)	$	14,934
Expenses:
Medical care costs	10			—			12,812			—			12,822
Cost of service revenue	—			—			369			—			369
General and administrative expenses	799			2			1,440			(1,014		)	1,227
Premium tax expenses	—			—			331			—			331
Depreciation and amortization	75			—			34			—			109
Restructuring and separation costs	120			—			41			—			161
Impairment losses	—			—			201			—			201
Total operating expenses	1,004			2			15,228			(1,014		)	15,220
Operating income (loss)	6			(1		)	(291		)	—			(286		)
Interest expense	85			—			—			—			85
Other income, net	(75		)	—			—			—			(75		)
Loss before income taxes	(4		)	(1		)	(291		)	—			(296		)
Income tax expense (benefit)	26			(1		)	(71		)	—			(46		)
Net loss before equity in net (losses) earnings of subsidiaries	(30		)	—			(220		)	—			(250		)
Equity in net (losses) earnings of subsidiaries	(220		)	(152		)	8			364			—
Net loss	$	(250	)	$	(152	)	$	(212	)	$	364		$	(250	)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

	Three Months Ended September 30, 2017
	Parent Guarantor			Other Guarantors			Non-Guarantors			Eliminations			Consolidated
	(In millions)
Revenue:
Total revenue	$	380		$	(1	)	$	5,031		$	(379	)	$	5,031
Expenses:
Medical care costs	3			—			4,217			—			4,220
Cost of service revenue	—			—			123			—			123
General and administrative expenses	244			—			518			(379		)	383
Premium tax expenses	—			—			106			—			106
Depreciation and amortization	23			—			10			—			33
Restructuring and separation costs	77			—			41			—			118
Impairment losses	—			—			129			—			129
Total operating expenses	347			—			5,144			(379		)	5,112
Operating income (loss)	33			(1		)	(113		)	—			(81		)
Interest expense	32			—			—			—			32
Income (loss) before income taxes	1			(1		)	(113		)	—			(113		)
Income tax expense (benefit)	9			(1		)	(24		)	—			(16		)
Net loss before equity in net (losses) earnings of subsidiaries	(8		)	—			(89		)	—			(97		)
Equity in net (losses) earnings of subsidiaries	(89		)	(86		)	8			167			—
Net loss	$	(97	)	$	(86	)	$	(81	)	$	167		$	(97	)

Condensed Consolidating Statements of Comprehensive Income

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

	Nine Months Ended September 30, 2018
	Parent Guarantor			Other Guarantors			Non-Guarantors			Eliminations			Consolidated
	(In millions)
Net income (loss)	$	506		$	(7	)	$	561		$	(554	)	$	506
Other comprehensive loss, net of tax	(4		)	—			(4		)	4			(4		)
Comprehensive income (loss)	$	502		$	(7	)	$	557		$	(550	)	$	502

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE LOSS

	Nine Months Ended September 30, 2017
	Parent Guarantor			Other Guarantors			Non-Guarantors			Eliminations			Consolidated
	(In millions)
Net loss	$	(250	)	$	(152	)	$	(212	)	$	364		$	(250	)
Other comprehensive income, net of tax	1			—			1			(1		)	1
Comprehensive loss	$	(249	)	$	(152	)	$	(211	)	$	363		$	(249	)

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

	Three Months Ended September 30, 2018
	Parent Guarantor		Other Guarantors			Non-Guarantors		Eliminations			Consolidated
	(In millions)
Net income (loss)	$	197	$	(3	)	$	170	$	(167	)	$	197
Other comprehensive gain, net of tax	1		—			1		(1		)	1
Comprehensive income (loss)	$	198	$	(3	)	$	171	$	(168	)	$	198

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE LOSS

	Three Months Ended September 30, 2017
	Parent Guarantor			Other Guarantors			Non-Guarantors			Eliminations		Consolidated
	(In millions)
Net loss	$	(97	)	$	(86	)	$	(81	)	$	167	$	(97	)
Other comprehensive income, net of tax	—			—			—			—		—
Comprehensive loss	$	(97	)	$	(86	)	$	(81	)	$	167	$	(97	)

Condensed Consolidating Balance Sheets

CONDENSED CONSOLIDATING BALANCE SHEETS

	September 30, 2018
	Parent Guarantor		Other Guarantors			Non-Guarantors			Eliminations			Consolidated
	(In millions)
ASSETS
Current assets:
Cash and cash equivalents	$	399	$	2		$	2,413		$	—		$	2,814
Investments	106		—			1,706			—			1,812
Receivables	2		—			1,344			—			1,346
Due from (to) affiliates	63		(4		)	(59		)	—			—
Prepaid expenses and other current assets	293		—			193			—			486
Derivative asset	843		—			—			—			843
Total current assets	1,706		(2		)	5,597			—			7,301
Property, equipment, and capitalized software, net	187		—			77			—			264
Goodwill and intangible assets, net	14		—			181			—			195
Restricted investments	—		—			118			—			118
Investment in subsidiaries, net	2,578		74			—			(2,652		)	—
Deferred income taxes	48		—			95			—			143
Other assets	40		—			6			(16		)	30
	$	4,573	$	72		$	6,074		$	(2,668	)	$	8,051
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Medical claims and benefits payable	$	4	$	—		$	2,038		$	—		$	2,042
Amounts due government agencies	—		—			1,030			—			1,030
Accounts payable and accrued liabilities	635		—			189			—			824
Deferred revenue	—		—			178			—			178
Current portion of long-term debt	296		—			—			—			296
Derivative liability	843		—			—			—			843
Total current liabilities	1,778		—			3,435			—			5,213
Long-term debt and lease financing obligations	1,217		—			16			(16		)	1,217
Other long-term liabilities	17		—			43			—			60
Total liabilities	3,012		—			3,494			(16		)	6,490
Total stockholders’ equity	1,561		72			2,580			(2,652		)	1,561
	$	4,573	$	72		$	6,074		$	(2,668	)	$	8,051

CONDENSED CONSOLIDATING BALANCE SHEETS

	December 31, 2017
	Parent Guarantor		Other Guarantors			Non-Guarantors			Eliminations			Consolidated
	(In millions)
ASSETS
Current assets:
Cash and cash equivalents	$	504	$	—		$	2,682		$	—		$	3,186
Investments	192		—			2,332			—			2,524
Restricted investments	169		—			—			—			169
Receivables	2		—			869			—			871
Due from (to) affiliates	148		(5		)	(143		)	—			—
Prepaid expenses and other current assets	103		16			136			(16		)	239
Derivative asset	522		—			—			—			522
Total current assets	1,640		11			5,876			(16		)	7,511
Property, equipment, and capitalized software, net	223		—			119			—			342
Goodwill and intangible assets, net	15		—			240			—			255
Restricted investments	—		—			119			—			119
Investment in subsidiaries, net	2,306		82			—			(2,388		)	—
Deferred income taxes	17		—			101			(15		)	103
Other assets	32		—			110			(1		)	141
	$	4,233	$	93		$	6,565		$	(2,420	)	$	8,471
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Medical claims and benefits payable	$	3	$	—		$	2,189		$	—		$	2,192
Amounts due government agencies	—		—			1,542			—			1,542
Accounts payable and accrued liabilities	178		14			174			—			366
Deferred revenue	—		—			282			—			282
Current portion of long-term debt	653		—			16			(16		)	653
Derivative liability	522		—			—			—			522
Total current liabilities	1,356		14			4,203			(16		)	5,557
Long-term debt and lease financing obligations	1,516		—			—			—			1,516
Deferred income taxes	—		—			15			(15		)	—
Other long-term liabilities	24		1			37			(1		)	61
Total liabilities	2,896		15			4,255			(32		)	7,134
Total stockholders’ equity	1,337		78			2,310			(2,388		)	1,337
	$	4,233	$	93		$	6,565		$	(2,420	)	$	8,471

Condensed Consolidating Statements of Cash Flows

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

	Nine Months Ended September 30, 2018
	Parent Guarantor			Other Guarantors		Non-Guarantors			Eliminations		Consolidated
	(In millions)
Operating activities:
Net cash provided by (used in) operating activities	$	451		$	1	$	(643	)	$	—	$	(191	)
Investing activities:
Purchases of investments	(136		)	—		(1,066		)	—		(1,202		)
Proceeds from sales and maturities of investments	383			—		1,687			—		2,070
Purchases of property, equipment and capitalized software	(16		)	—		(8		)	—		(24		)
Capital contributions to subsidiaries	(122		)	—		122			—		—
Dividends from subsidiaries	268			—		(268		)	—		—
Change in amounts due to/from affiliates	70			1		(71		)	—		—
Other, net	—			—		(23		)	—		(23		)
Net cash provided by investing activities	447			1		373			—		821
Financing activities:
Repayment of credit facility	(300		)	—		—			—		(300		)
Repayment of principal amount of 1.125% Notes	(236		)	—		—			—		(236		)
Cash paid for partial settlement of 1.125% Conversion Option	(477		)	—		—			—		(477		)
Cash received for partial termination of 1.125% Call Option	477			—		—			—		477
Cash paid for partial termination of 1.125% Warrants	(419		)	—		—			—		(419		)
Repayment of principal amount of 1.625% Notes	(64		)	—		—			—		(64		)
Other, net	7			—		—			—		7
Net cash used in financing activities	(1,012		)	—		—			—		(1,012		)
Net (decrease) increase in cash, cash equivalents, and restricted cash and cash equivalents	(114		)	2		(270		)	—		(382		)
Cash, cash equivalents, and restricted cash and cash equivalents at beginning of period	513			—		2,777			—		3,290
Cash, cash equivalents, and restricted cash and cash equivalents at end of period	$	399		$	2	$	2,507		$	—	$	2,908

	Nine Months Ended September 30, 2017
	Parent Guarantor			Other Guarantors		Non-Guarantors			Eliminations		Consolidated
	(In millions)
Operating activities:
Net cash provided by operating activities	$	215		$	—	$	742		$	—	$	957
Investing activities:
Purchases of investments	(331		)	—		(1,563		)	—		(1,894		)
Proceeds from sales and maturities of investments	148			—		1,388			—		1,536
Purchases of property, equipment and capitalized software	(67		)	—		(18		)	—		(85		)
Capital contributions to subsidiaries	(363		)	2		361			—		—
Dividends from subsidiaries	136			—		(136		)	—		—
Change in amounts due to/from affiliates	(100		)	—		100			—		—
Other, net	—			—		(33		)	—		(33		)
Net cash (used in) provided by investing activities	(577		)	2		99			—		(476		)
Financing activities:
Proceeds from senior notes offerings, net of issuance costs	325			—		—			—		325
Proceeds from borrowings under credit facility	300			—		—			—		300
Other, net	7			—		—			—		7
Net cash provided by financing activities	632			—		—			—		632
Net increase in cash, cash equivalents, and restricted cash and cash equivalents	270			2		841			—		1,113
Cash, cash equivalents, and restricted cash and cash equivalents at beginning of period	86			—		2,826			—		2,912
Cash, cash equivalents, and restricted cash and cash equivalents at end of period	$	356		$	2	$	3,667		$	—	$	4,025