Health Net 2011 Annual Report Download - page 160

HEALTH NET, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(2) Includes a $2.7 million expense related to our cost management initiatives, a $0.3 million benefit from
litigation reserve true-ups and a $6.3 million favorable adjustment to loss on sale of Northeast health plan
subsidiaries.
(3) Includes a $4.7 million expense related to our cost management initiatives and a $0.2 million benefit from
litigation reserve true-ups.
(4) Includes a $9.7 million expense related to our cost management initiatives and a $6.3 million benefit from
litigation reserve true-ups.
(5) The sum of the quarterly amounts may not equal the year-to-date amounts due to rounding.
2010
March 31 June 30 September 30 December 31
(Dollars in millions, except per share data)
Total revenues ...................................... $3,416.1 $3,437.0 $3,393.5 $3,373.3
Health plan services costs ............................. 2,211.3 2,163.2 2,134.7 2,100.0
Government contracts costs ........................... 771.9 811.4 814.4 770.5
Income from operations before income taxes .............. 26.6 77.9 102.2 124.2
Net income ........................................ 16.1(1) 45.1(2) 62.7(3) 80.4(4)
Basic earnings per share .............................. $ 0.16 $ 0.46 $ 0.64 $ 0.84
Diluted earnings per share (5) .......................... $ 0.16 $ 0.45 $ 0.64 $ 0.83
(1) Includes a $14.5 million expense related to our operations strategy and other cost management initiatives.
(2) Includes a $24.9 million expense related to our operations strategy and other cost management initiatives, a
$9 million expense related to early debt extinguishment and related interest rate swap termination, a $6
million goodwill impairment related to our Northeast Operations, a $21.6 million benefit from a litigation
reserve true-up and a $8.2 million favorable adjustment to loss on sale of Northeast health plan subsidiaries.
(3) Includes an $8.6 million expense related to our operations strategy and other cost management initiatives
and a $21.5 million favorable adjustment to loss on sale of Northeast health plan subsidiaries.
(4) Includes a $13.2 million expense related to our operations strategy and other cost management initiatives, a
$24.9 million benefit from a litigation reserve true-up and a $12.3 million favorable adjustment to loss on
sale of Northeast health plan subsidiaries.
(5) The sum of the quarterly amounts may not equal the year-to-date amounts due to rounding.
Note 18—Credit Quality of Financing Receivables
As of December 31, 2011 and 2010, our financing receivables consisted of the following (amounts in millions):
2011 2010
Amounts due for contingent membership renewals .................... $— $33.8
Loans to health care providers .................................... 5.3 13.6
Amounts due for contingent membership renewals arose from the Northeast Sale (see Note 2). United was
required to pay us additional consideration for the value of the Transitioning HNL Members and the members of
the Acquired Companies that transitioned to other United products based on a formula set forth in the Stock
Purchase Agreement to the extent such amounts exceeded the initial minimum payment of $60.0 million that
United made to us at closing. This membership transition was completed on July 1, 2011. The receivable amount
accrued as of December 31, 2010 was received in March 2011. As of December 31, 2011, we had no remaining
amounts due in connection with contingent membership renewals. Loans to health care providers are made from
time to time to provide funding to certain health care providers and are generally due within twelve months from
the time of the loan.
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