Segment Information

9 Months Ended

Sep. 30, 2017

Segment Information [Abstract]

Segment Information [Text Block]

Note 17 ― Segment Information

See Note 1 for a description of the Company’s reporting segments.

In the Company’s segment disclosures, we present “operating revenues,” defined as total revenues excluding realized investment results. The Company excludes realized investment results from this measure because its portfolio managers may sell investments based on factors largely unrelated to the underlying business purposes of each segment. As a result, gains or losses created in this process may not be indicative of the past or future underlying performance of the business.

The Company uses “adjusted income (loss) from operations” as its principal financial measure of segment operating performance because management believes it best reflects the underlying results of business operations and permits analysis of trends in underlying revenue, expenses and profitability. Adjusted income from operations is defined as shareholders’ net income (loss) excluding after-tax realized investment gains and losses, net amortization of other acquired intangible assets and special items. Income or expense amounts are excluded from adjusted income from operations for the following reasons:

• Realized investment results are excluded because, as noted above, the Company’s portfolio managers may sell investments based on factors largely unrelated to the underlying business purposes of each segment.
• Net amortization of other intangible assets is excluded because it relates to costs incurred for acquisitions and, as a result, it does not relate to the core performance of the Company’s business operations.
• Special items, if any, are excluded because management believes they are not representative of the underlying results of operations.This is generally because the nature and size of these matters are not indicative of our ongoing business operations. Further context about these items is provided in the footnotes listed in the table below.

	Three Months Ended
	September 30, 2017				September 30, 2016
(In millions)	Before-tax		After-tax		Before-tax		After-tax
Debt extinguishment costs - see Note 5	$	321	$	209	$	-	$	-
Merger-related transaction costs - see Note 3		9		6		49		46
Charges associated with litigation matters - see Note 16(E)		-		-		40		25
Total impact from special items	$	330	$	215	$	89	$	71
	Nine Months Ended
	September 30, 2017				September 30, 2016
	Before-tax		After-tax		Before-tax		After-tax
Debt extinguishment costs - see Note 5	$	321	$	209	$	-	$	-
Merger-related transaction costs - see Note 3		88		8		123		108
Long-term care guaranty fund assessment - see Note 16(D)		129		83		-		-
Charges associated with litigation matters - see Note 16(E)		-		-		40		25
Total impact from special items	$	538	$	300	$	163	$	133

Summarized segment financial information was as follows:

(In millions)	Global Health Care		Global Supplemental Benefits		Group Disability and Life		Other Operations		Corporate		Total
Three Months Ended September 30, 2017
Premiums, fees and other revenues and mail order pharmacy revenues	$	7,980	$	954	$	1,015	$	29	$	(11)	$	9,967
Net investment income		89		31		84		86		8		298
Operating revenues	$	8,069	$	985	$	1,099	$	115	$	(3)	$	10,265
Total revenues	$	8,144	$	985	$	1,136	$	120	$	(3)	$	10,382
Shareholders' net income (loss)	$	610	$	105	$	97	$	18	$	(270)	$	560
After-tax adjustments to reconcile to adjusted income from operations:
Net realized investment (gains)		(47)		-		(24)		(4)		-		(75)
Amortization of other acquired intangible assets, net		12		4		-		-		-		16
Special items:
Debt extinguishment costs		-		-		-		-		209		209
Merger-related transaction costs		-		-		-		-		6		6
Total special items		-		-		-		-		215		215
Adjusted income (loss) from operations	$	575	$	109	$	73	$	14	$	(55)	$	716
(In millions)	Global Health Care		Global Supplemental Benefits		Group Disability and Life		Other Operations		Corporate		Total
Three Months Ended September 30, 2016
Premiums, fees and other revenues and mail order pharmacy revenues	$	7,636	$	837	$	1,026	$	28	$	(4)	$	9,523
Net investment income		77		29		85		87		4		282
Operating revenues	$	7,713	$	866	$	1,111	$	115	$	-	$	9,805
Total revenues	$	7,775	$	868	$	1,128	$	109	$	-	$	9,880
Shareholders' net income (loss)	$	413	$	77	$	65	$	9	$	(108)	$	456
After-tax adjustments to reconcile to adjusted income from operations:
Net realized investment (gains) losses		(42)		-		(12)		5		1		(48)
Amortization of other acquired intangible assets, net		20		4		-		-		-		24
Special items:
Merger-related transaction costs		-		-		-		-		46		46
Charges associated with litigation matters		25		-		-		-		-		25
Total special items		25		-		-		-		46		71
Adjusted income (loss) from operations	$	416	$	81	$	53	$	14	$	(61)	$	503

Nine Months Ended September 30, 2017
Premiums, fees and other revenues and mail order pharmacy revenues	$	24,079	$	2,759	$	3,070	$	89	$	(35)	$	29,962
Net investment income		273		90		262		260		24		909
Operating revenues	$	24,352	$	2,849	$	3,332	$	349	$	(11)	$	30,871
Total revenues	$	24,485	$	2,861	$	3,399	$	351	$	(11)	$	31,085
Shareholders' net income (loss)	$	1,753	$	283	$	253	$	55	$	(373)	$	1,971
After-tax adjustments to reconcile to adjusted income from operations:
Net realized investment (gains)		(85)		(9)		(44)		(2)		-		(140)
Amortization of other acquired intangible assets, net		40		14		-		-		-		54
Special items:
Debt extinguishment costs		-		-		-		-		209		209
Merger-related transaction costs		-		-		-		-		8		8
Long-term care guaranty fund assessment		68		-		15		-		-		83
Total special items		68		-		15		-		217		300
Adjusted income (loss) from operations	$	1,776	$	288	$	224	$	53	$	(156)	$	2,185
(In millions)	Global Health Care		Global Supplemental Benefits		Group Disability and Life		Other Operations		Corporate		Total
Nine Months Ended September 30, 2016
Premiums, fees and other revenues and mail order pharmacy revenues	$	23,207	$	2,425	$	3,065	$	83	$	(14)	$	28,766
Net investment income		230		82		253		270		13		848
Operating revenues	$	23,437	$	2,507	$	3,318	$	353	$	(1)	$	29,614
Total revenues	$	23,510	$	2,507	$	3,356	$	352	$	(1)	$	29,724
Shareholders' net income (loss)	$	1,414	$	214	$	81	$	53	$	(277)	$	1,485
After-tax adjustments to reconcile to adjusted income from operations:
Net realized investment (gains) losses		(49)		1		(25)		1		1		(71)
Amortization of other acquired intangible assets, net		56		16		-		-		-		72
Special items:
Merger-related transaction costs		-		-		-		-		108		108
Charges associated with litigation matters		25		-		-		-		-		25
Total special items		25		-		-		-		108		133
Adjusted income (loss) from operations	$	1,446	$	231	$	56	$	54	$	(168)	$	1,619

The Company had net receivablesfrom CMS of $0.4 billion as of September 30, 2017and $0.6 billion as of December 31, 2016. These amounts were included in the Consolidated Balance Sheets in premiums, accounts and notes receivable and reinsurance recoverables. Premiums from CMS were 17% of consolidated revenues for the nine months endedSeptember 30, 2017and 20% for the nine months endedSeptember 30, 2016. These amounts were reported in the Global Health Care segment.