Health Net 2010 Annual Report Download - page 59

Item 6. Selected Financial Data.
The following selected financial and operating data as of and for the years ended December 31, 2010, 2009,
and 2008 are derived from our audited consolidated financial statements and notes thereto contained in this
Annual Report on Form 10-K. The selected financial and operating data as of and for the years ended
December 31, 2007 and 2006 are derived from our audited consolidated financial statements which are not
included herein. The selected financial and operating data should be read in conjunction with “Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated
financial statements and notes thereto contained elsewhere in this Annual Report on Form 10-K.
Year Ended December 31,
2010 2009 2008 2007 2006
(Dollars in thousands, except per share and PMPM data)
REVENUES:
Health plan services premiums .................... $ 9,996,888 $12,440,589 $12,392,006 $11,435,314 $10,364,740
Government contracts ........................... 3,344,483 3,104,700 2,835,261 2,501,677 2,376,014
Net investment income .......................... 71,181 105,930 91,042 120,176 111,042
Administrative services fees and other income ........ 21,133 62,022 48,280 51,104 56,554
Northeast administrative services fees and other ....... 186,167 0000
Total revenues ............................. $13,619,852 $15,713,241 $15,366,589 $14,108,271 $12,908,350
INCOME SUMMARY (1):
Net income (loss) ............................... $ 204,243 $ (49,004) $ 95,003 $ 193,697 $ 329,313
NET INCOME (LOSS) PER SHARE—
DILUTED (1):
Net income (loss) ............................... $ 2.06 $ (0.47) $ 0.88 $ 1.70 $ 2.78
Weighted average shares outstanding:
Diluted ................................... 99,232 103,849 107,610 113,829 118,310
BALANCE SHEET DATA:
Cash and cash equivalents and investments available for
sale ........................................ $ 2,022,112 $ 2,079,815 $ 2,172,859 $ 2,564,295 $ 2,120,844
Total assets .................................... 4,131,693 4,282,651 4,816,350 4,933,055 4,297,022
Loans payable—Current ......................... 0 104,007 27,335 35,000 200,000
Loans payable—Long term ....................... 0 100,000 253,992 112,363 300,000
Senior notes payable ............................ 398,685 398,480 398,276 398,071 —
Total stockholders’ equity (2) ..................... 1,694,416 1,695,783 1,752,126 1,875,582 1,778,965
OPERATING DATA:
Pretax margin .................................. 2.4% (0.2)% 1.0% 2.5% 3.7%
Western Region Operations health plans services
medical care ratio (MCR) (3) .................... 86.6% 86.7% 87.4% 85.4% 83.0%
Government contracts cost ratio ................... 94.7% 94.6% 95.3% 92.2% 94.0%
Western Region Operations G&A expense ratio (3) .... 8.9% 8.4% 8.3% 11.1% 11.2%
Western Region Operations selling costs ratio (3) ..... 2.4% 2.4% 2.7% 2.9% 2.4%
Western Region Operations health plan services
premiums per member per month (PMPM) (3) ...... $ 282.57 $ 272.85 $ 256.72 $ 263.54 $ 243.70
Western Region Operations health plan services costs
PMPM (3) .................................. $ 244.58 $ 236.61 $ 224.44 $ 225.00 $ 202.22
Net cash provided by (used in) operating activities ..... $ 271,422 $ 247,533 $ (158,962) $ 605,482 $ 277,937
Net cash (used in) investing activities ............... $ (200,593) $ (135,174) $ (67,871) $ (230,195) $ (184,879)
Net cash (used in) financing activities ............... $ (403,494) $ (97,757) $ (111,983) $ (73,076) $ (130,737)
(1) For 2010, includes pretax charges of $61.2 million related to our operations strategy and other cost management initiatives, and
$9.0 million in early debt extinguishment and related interest rate swap termination costs, partially reduced by a $46.5 million
benefit from litigation reserve true-ups and a $42.0 million adjustment to loss on sale of Northeast health plan subsidiaries. For
2009, includes pretax charges of $105.9 million for loss on Northeast Sale, $174.9 million of asset impairment on Northeast
operations and $123.6 million related to our operations strategy, reductions for litigation reserve true-ups and Northeast Sale-
related expenses. For 2008, includes pretax charges of $175.1 million for costs related to our operations strategy, legal and
regulatory fees primarily associated with our rescission practices, estimated costs related to the settlement agreement for the
McCoy, Wachtel and Scharfman class action lawsuits, and other-than-temporary impairments of investments. For 2007, includes
a $306.8 million pretax litigation and regulatory-related charge. For 2006, includes a $107.2 million pretax charge relating to
debt refinancing and litigation. For 2005, includes an $83.3 million pretax charge for litigation and severance.
(2) No cash dividends were declared in any of the years presented.
(3) The amounts for 2006 and 2007 are presented for total health plan services and may not be comparable to those for the years
ended December 31, 2010, 2009 and 2008.
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