XML 46 R28.htm IDEA: XBRL DOCUMENT v3.24.0.1
SCHEDULE I - PARENT COMPANY FINANCIAL INFORMATION
 12 Months Ended
Dec. 31, 2023
Condensed Financial Information Disclosure [Abstract]  
SCHEDULE I - PARENT COMPANY FINANCIAL INFORMATION
SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION
CONDENSED BALANCE SHEETS
 December 31,
 20232022
 (in millions, except share
amounts)
ASSETS
Current assets:
  Cash and cash equivalents$250 $614 
  Investment securities260 320 
  Receivable from operating subsidiaries2,050 1,807 
  Other current assets717 577 
     Total current assets3,277 3,318 
Property and equipment, net2,334 2,393 
Investment in subsidiaries29,666 27,905 
Other long-term assets348 282 
     Total assets$35,625 $33,898 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Payable to operating subsidiaries$5,768 $5,421 
Short-term debt1,443 2,092 
Current portion of notes payable to operating subsidiaries36 36 
Book overdraft75 73 
Other current liabilities1,566 1,425 
    Total current liabilities8,888 9,047 
Long-term debt10,213 9,034 
Other long-term liabilities262 506 
     Total liabilities19,363 18,587 
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $1 par; 10,000,000 shares authorized; none issued
— — 
Common stock, $0.16 2/3 par; 300,000,000 shares authorized; 198,690,082 shares issued at December 31, 2023 and 198,666,598 shares issued at December 31, 2022
33 33 
    Capital in excess of par value3,346 3,246 
    Retained earnings27,540 25,492 
Accumulated other comprehensive (loss) income (999)(1,304)
Treasury stock, at cost, 76,465,862 shares at December 31, 2023 and 73,691,955 shares at December 31, 2022
(13,658)(12,156)
     Total stockholders' equity16,262 15,311 
     Total liabilities and stockholders' equity$35,625 $33,898 
See accompanying notes to the parent company financial statements.
SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION
CONDENSED STATEMENTS OF INCOME
 
 For the year ended December 31,
 202320222021
 (in millions)
Revenues:
Management fees charged to operating subsidiaries$2,075 $1,554 $1,633 
Investment and other (loss) income, net42 (88)(266)
     Total revenues2,117 1,466 1,367 
Expenses:
  Operating costs2,016 1,700 1,404 
  Depreciation656 581 488 
  Interest489 400 313 
     Total expenses3,161 2,681 2,205 
Other income, net(184)— (672)
Loss before income taxes and equity in net earnings of subsidiaries(860)(1,215)(166)
Benefit for income taxes(146)(266)(259)
(Loss) income before equity in net earnings of subsidiaries(714)(949)93 
Equity in net earnings of subsidiaries3,203 3,755 2,761 
Equity in net earnings of equity method investments— — 79 
Net income attributable to Humana$2,489 $2,806 $2,933 
See accompanying notes to the parent company financial statements.
SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
 For the year ended December 31,
 202320222021
 (in millions)
Net income attributable to Humana$2,489 $2,806 $2,933 
Other comprehensive income (loss):
Change in gross unrealized investment gains (losses)372 (1,819)(356)
Effect of income taxes(85)418 81 
Total change in unrealized investment
     gains (losses), net of tax		287 (1,401)(275)
Reclassification adjustment for net realized
 losses (gains) included in investment income 		25 72 (103)
Effect of income taxes(7)(17)23 
Total reclassification adjustment, net of tax18 55 (80)
Other comprehensive income (loss), net of tax305 (1,346)(355)
Comprehensive income attributable to equity method
  investments		— — 6 
Comprehensive income attributable to Humana$2,794 $1,460 $2,584 
See accompanying notes to the parent company financial statements.
SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION
CONDENSED STATEMENTS OF CASH FLOWS
 For the year ended December 31,
 202320222021
 (in millions)
Net cash provided by operating activities$3,042 $4,868 $2,853 
Cash flows from investing activities:
  Acquisitions, net of cash acquired(233)(337)(4,187)
Capital contributions to operating subsidiaries(792)(484)(2,580)
  Purchases of property and equipment, net(761)(931)(958)
Purchases of investment securities(17)(63)(200)
Proceeds from sale of investment securities41 468 71 
Maturities of investment securities67 30 122 
Net cash used in investing activities(1,695)(1,317)(7,732)
Cash flows from financing activities:
Proceeds from issuance of senior notes, net2,537 1,976 2,953 
  Repayments of senior notes(1,832)(1,000)— 
Proceeds (repayments) from issuance of commercial paper, net211 (376)352 
  Proceeds from issuance of term loan— — 2,500 
Repayment of term loan(500)(2,000)— 
  Change in book overdraft2 5 (52)
  Common stock repurchases(1,573)(2,096)(79)
  Dividends paid(431)(392)(354)
Proceeds from stock option exercises and other(125)40 29 
Net cash (used in) provided by financing activities(1,711)(3,843)5,349 
(Decrease) increase in cash and cash equivalents(364)(292)470 
Cash and cash equivalents at beginning of year614 906 436 
Cash and cash equivalents at end of year$250 $614 $906 
See accompanying notes to the parent company financial statements.
SCHEDULE I—PARENT COMPANY FINANCIAL INFORMATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
BASIS OF PRESENTATION
Parent company financial information has been derived from our consolidated financial statements and excludes the accounts of all operating subsidiaries. This information should be read in conjunction with our consolidated financial statements.
TRANSACTIONS WITH SUBSIDIARIES
Services Fee
Through intercompany service agreements approved, if required, by state regulatory authorities, Humana Inc., our parent company, charges a services fee for reimbursement of certain centralized services provided to its subsidiaries including information systems, disbursement, investment and cash administration, marketing, legal, finance, and medical and executive management oversight.
Dividends
Cash dividends received from subsidiaries and included as a component of net cash provided by operating activities were $1.8 billion in 2023, $1.3 billion in 2022, and $1.6 billion in 2021.
Guarantee
Through indemnity agreements approved by state regulatory authorities, certain of our regulated subsidiaries generally are guaranteed by our parent company in the event of insolvency for: (1) member coverage for which premium payment has been made prior to insolvency; (2) benefits for members then hospitalized until discharged; and (3) payment to providers for services rendered prior to insolvency. Our parent has also guaranteed the obligations of our military services subsidiaries and funding to maintain required statutory capital levels of certain other regulated subsidiaries.
REGULATORY REQUIREMENTS
Certain of our subsidiaries operate in states that regulate the payment of dividends, loans, or other cash transfers to Humana Inc., our parent company, and require minimum levels of equity as well as limit investments to approved securities. The amount of dividends that may be paid to Humana Inc. by these subsidiaries, without prior approval by state regulatory authorities, or ordinary dividends, is limited based on the entity’s level of statutory income and statutory capital and surplus. If the dividend, together with other dividends paid within the preceding twelve months, exceeds a specified statutory limit or is paid from sources other than earned surplus, it is generally considered an extraordinary dividend requiring prior regulatory approval. In most states, prior notification is provided before paying a dividend even if approval is not required.
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 $12.2 billion and $11.3 billion as of December 31, 2023 and 2022, respectively, which exceeded aggregate minimum regulatory requirements of $9.8 billion and $8.4 billion, respectively. The amount of ordinary dividends that may be paid to our parent company in 2024 is approximately $1.1 billion in the aggregate. The amount, timing and mix of ordinary and extraordinary dividend payments will vary due to state regulatory requirements, the level of excess statutory capital and surplus and expected future surplus requirements related to, for example, premium volume and product mix. Actual dividends that were paid to our parent company were approximately $1.8 billion in 2023, $1.3 billion in 2022, and $1.6 billion in 2021.
Our use of operating cash flows derived from our non-insurance subsidiaries, such as in our Healthcare Services segment, is generally not restricted by state departments of insurance (or comparable state regulators).
ACQUISITIONS
Refer to Note 3 to the audited Consolidated Financial Statements included in Part II, Item 8, "Financial Statements and Supplementary Data" of this Form 10-K for a description of certain acquisitions.
INCOME TAXES
Refer to Note 12 to the audited Consolidated Financial Statements included in Part II, Item 8, "Financial Statements and Supplementary Data" of this Form 10-K for a description of income taxes.
DEBT
Refer to Note 13 to the audited Consolidated Financial Statements included in Part II, Item 8, "Financial Statements and Supplementary Data" of this Form 10-K for a description of debt.
STOCKHOLDERS' EQUITY
Refer to Note 16 to the audited Consolidated Financial Statements included in Part II, Item 8, "Financial Statements and Supplementary Data" of this Form 10-K for a description of stockholders’ equity, including stock repurchases and stockholder dividends.