Aetna 2015 Annual Report Download - page 12

Annual Report- Page 6
more than we have projected; the potential for unfavorable development of prior period health care cost estimates,
the risk that risk-adjusted revenue in our ACA-compliant products may be lower than we currently project, and the
risk that our medical membership may be lower than we currently project.
Our primary business goals for 2016 are to improve our operating earnings and to close and begin a successful
integration of the Proposed Acquisition.
Except as specifically noted, the projected information in this annual report does not include or reflect any benefit
or impact from or any transaction or other costs associated with the Proposed Acquisition. The closing of the
Proposed Acquisition will significant affect the comparability of our results following the closing with our results in
pre-closing periods.
Refer to “Forward-Looking Information/Risk Factors” beginning on page 42 for information regarding other
important factors that may cause our actual results to differ from those currently projected in “Outlook for 2016”
and/or otherwise materially affect us.
Management Updates
Sharon A. Virag, Vice President, Controller and Chief Accounting Officer, joined Aetna in June 2015 and succeeded
Rajan Parmeswar when he left the company in July 2015.
On September 30, 2015, we announced the following changes:
• Joseph M. Zubretsky, Senior Executive Vice President, Healthagen, will be leaving Aetna effective March
3, 2016.
• Gary W. Loveman, Ph.D, joined Aetna as Executive Vice President, Consumer and Health Services.
• Richard M. Jelinek joined Aetna as Executive Vice President, Humana Integration, responsible for the
Aetna-Humana integration and Aetna’s enterprise strategy.
Segment Results and Use of Non-GAAP Measures in this Document
The following discussion of operating results is presented based on our reportable segments in accordance with the
accounting guidance for segment reporting and is consistent with our segment disclosure included in Note 20 of
Notes to Consolidated Financial Statements beginning on page 143. Our operations are conducted in three business
segments: Health Care, Group Insurance and Large Case Pensions. Our Corporate Financing segment is not a
business segment; it is added to our business segments to reconcile our segment reporting to our consolidated
results. The Corporate Financing segment includes interest expense on our outstanding debt and the financing
components of our pension and other postretirement employee benefit plans (“OPEB”) expense (the service cost
and prior service cost components of this expense are allocated to our business segments).
Our discussion of operating results is based on operating earnings. Operating earnings exclude from net income
attributable to Aetna reported in accordance with GAAP, net realized capital gains or losses, amortization of other
acquired intangible assets and other items, if any, that neither relate to the ordinary course of our business nor
reflect our underlying business performance. Although the excluded items may recur, we believe excluding them
from net income attributable to Aetna to arrive at operating earnings provides a more useful comparison of our
underlying business performance from period to period. Net realized capital gains and losses arise from various
types of transactions, primarily in the course of managing a portfolio of assets that support the payment of
liabilities. Amortization of other acquired intangible assets relates to our acquisition activities, including Coventry,
the InterGlobal Group (“InterGlobal”) and bswift LLC (“bswift”). These transactions and amortization do not
directly relate to the underwriting or servicing of products for our customers and are not directly related to the core
performance of our business operations. Operating earnings is the measure reported to our Chief Executive Officer
for purposes of assessing financial performance and making operating decisions, such as the allocation of resources
among our business segments. In each business segment discussion in this MD&A, we provide a table that
reconciles operating earnings to net income attributable to Aetna. Each table details the net realized capital gains or
losses, amortization of other acquired intangible assets and any other items excluded from net income attributable to
Aetna, and the footnotes to each table describe the nature of each other item and the reason we believe it is