Aetna 2014 Annual Report Download - page 99

Annual Report- Page 93
The acquisition of Coventry resulted in a $1.4 billion increase in health care costs payable at the Acquisition Date
which significantly impacts the year-over-year comparability of changes in health care costs payable (refer to Note
3 beginning on page 90 for additional information).
7. Goodwill and Other Acquired Intangible Assets
As discussed in Note 3, we completed the acquisitions of InterGlobal and bSwift in 2014 as well as the Coventry
acquisition in 2013. In accordance with applicable accounting guidance, we allocated the amount paid to the fair
value of the net assets acquired, with any excess amounts recorded as goodwill. The change in goodwill in 2014 and
2013 is as follows:
(Millions) 2014 2013
Balance, beginning of the period $ 10,227.5 $ 6,214.4
Goodwill acquired:
bSwift (1) 318.0 —
InterGlobal 67.7 —
Coventry —4,014.8
Other —(1.7)
Balance, end of the period (2) $ 10,613.2 $ 10,227.5
(1) Goodwill related to the acquisition of bSwift is considered preliminary, pending the final allocation of the applicable purchase price.
(2) At both December 31, 2014 and 2013, approximately $113 million was assigned to the Group Insurance segment, with the remainder
assigned to the Health Care segment.
Other acquired intangible assets at December 31, 2014 and 2013 were comprised of the following:
(Millions) Cost Accumulated
Amortization Net Balance Amortization Period (Years)
2014
Provider networks $ 1,254.1 $ 570.4 $ 683.7 12-25 (1)
Customer lists 1,319.5 (2) 413.6 905.9 5-14 (1)
Value of business acquired 149.2 65.3 83.9 20 (3)
Technology 188.2 (2) 74.0 114.2 4-10
Other 10.5 2.7 7.8 2-15
Definite-lived trademarks 172.4 (2) 41.9 130.5 5-20
Indefinite-lived trademarks 22.3 — 22.3
Total other acquired intangible assets $ 3,116.2 $ 1,167.9 $ 1,948.3
2013
Provider networks $ 1,253.2 $ 508.8 $ 744.4 12-25 (1)
Customer lists 1,347.0 361.8 985.2 5-14 (1)
Value of business acquired 149.2 48.5 100.7 20 (3)
Technology 146.6 49.5 97.1 4-10
Other 6.7 1.8 4.9 2-15
Definite-lived trademarks 165.0 25.5 139.5 9-20
Indefinite-lived trademarks 22.3 — 22.3
Total other acquired intangible assets $ 3,090.0 $ 995.9 $ 2,094.1
(1) The amortization period for our provider networks and customer lists includes an assumption of renewal or extension of these
arrangements. At both December 31, 2014 and 2013, the periods prior to the next renewal or extension for our provider networks
primarily ranged from 1 to 3 years, and the period prior to the next renewal or extension for our customer lists was approximately 1 year.
Any costs related to the renewal or extension of these contracts are expensed as incurred.
(2) As a result of our acquisition of bSwift in 2014, we preliminarily assigned $41.6 million to technology, $25.8 million to customer lists,
and $6.2 million to definite-lived trademarks.
(3) VOBA is being amortized over the expected life of the acquired contracts in proportion to estimated premium.