Health Net 2000 Annual Report Download - page 56

54 HEALTH NET 2000 Annual Report
connection with pending dispositions of non-core busi-
nesses.These charges included a $4.7 million reduction
in the carrying value of the Company’s Pittsburgh
health plans to fair value.The Company also adjusted
the carrying value of its subacute operations by $1.5
million to fair value.The revenue and pretax income
attributable to these operations were $59.7 million and
$1.3 million for the year ended December 31, 2000.
Revenue and pretax losses attributable to these opera-
tions were $66.2 million and $1.4 million for the year
ended December 31, 1999.The carrying value of these
assets as of December 31, 2000, and 1999 was $14.5
million and $16.2 million, respectively.
NOTE 16 – Segment Information
As of December 31, 1998, the Company adopted SFAS
No. 131,“Disclosures About Segments of an Enterprise
and Related Information” (“SFAS 131”). SFAS 131 estab-
lishes annual and interim reporting standards for an enter-
prise’s reportable segments and related disclosures about its
products, services, geographic areas and major customers.
Under SFAS 131, reportable segments are to be defined on
a basis consistent with reports used by management to
assess performance and allocate resources.The Company’s
reportable segments are business units that offer different
products to different classes of customers.The Company
has two reportable segments: Health Plan Services and
Government Contracts/Specialty Services.The Health Plan
Services segment provides a comprehensive range of health
care services through HMO and PPO networks.The
Government Contracts/Specialty Services segment admin-
isters large, multi-year managed care government contracts
and also offers behavioral, dental, vision, and pharmaceuti-
cal products and services.
The Company evaluates performance and allocates
resources based on profit or loss from operations before
income taxes.The accounting policies of the reportable
segments are the same as those described in the summary
of significant accounting policies, except intersegment
transactions are not eliminated.
Presented below are segment data for the three years in the period ended December 31 (amounts in thousands):
Government
Contracts/
Specialty Corporate
2000 Health Plan Services and Other(i) Total
Revenues from external sources $7,351,098 $1,623,158 $ –$8,974,256
Intersegment revenues –67,325 –67,325
Investment and other income 90,144 11,237 918 102,299
Interest expense 2,796 24 85,110 87,930
Depreciation and amortization 58,711 15,012 32,176 105,899
Segment profit (loss) 297,323 111,147 (145,723) 262,747
Segment assets 2,815,506 805,609 49,001 3,670,116
Government
Contracts/
Specialty Corporate
1999 Health Plan Services and Other(i) Total
Revenues from external sources $7,031,055 $1,529,855 $ –$8,560,910
Intersegment revenues –78,083 –78,083
Investment and other income 81,761 7,820 (2,604) 86,977
Interest expense 5,624 102 78,082 83,808
Depreciation and amortization 71,409 14,736 25,896 112,041
Segment profit (loss) 218,318 118,455 (92,765) 244,008
Segment assets 2,596,285 796,362 303,834 3,696,481
Government
Contracts/
Specialty Corporate
1998 (ii) Health Plan Services and Other(i) Total
Revenues from external sources $7,124,161 $1,411,267 $ –$8,535,428
Intersegment revenues –63,008 –63,008
Investment and other income 76,455 19,500 (2,514) 93,441
Interest expense 11,905 314 79,940 92,159
Depreciation and amortization 89,008 13,891 25,194 128,093
Segment profit (loss) (101,959) 123,385 (275,580) (254,154)
Segment assets 2,780,783 800,767 281,719 3,863,269
(i) Includes intersegment eliminations.
(ii) Excludes workers’compensation segment treated as discontinued operations which was sold in 1998. See Note 3.