Health Net 2011 Annual Report Download - page 83

Year Ended December 31, 2010 Compared to Year Ended December 31, 2009
The Northeast Operations had approximately $258.3 million and $2,651.5 million in total revenues in the
years ended December 31, 2010 and 2009, respectively, which represent 2 percent and 17 percent of our total
revenues for the years ended December 31, 2010 and 2009, respectively. The Northeast Operations had a pretax
loss of $68.7 million for the year ended December 31, 2010 compared to a pretax loss of $165.6 million for the
year ended December 31, 2009. Our operating results for the year ended December 31, 2010 were impacted by a
$6.0 million goodwill impairment, reduced by a $42.0 million adjustment to loss on sale of our Northeast health
plan subsidiaries. Our operating results for the year ended December 31, 2009 were impacted by a $105.9 million
loss on the sale of our Northeast health plan subsidiaries.
The Northeast Operations had $71.2 million of health plan services premiums and $64.5 million of health
plan services costs for the year ended December 31, 2010. The revenues and expenses associated with providing
services under the United Administrative Services Agreements were $186.2 million and $279.4 million for the
year ended December 31, 2010, respectively.
Corporate/Other
The following table summarizes the Corporate/Other segment for the years ended December 31, 2011, 2010
and 2009.
Year Ended December 31,
2011 2010 2009
(Dollars in thousands)
Costs included in health plan services costs .......................... $ (6,799) $(46,509) $ (4,799)
Costs included in government contract costs .......................... 6,496 2,413 3,632
Costs included in G&A .......................................... 199,732 58,840 124,797
Early debt extinguishment and related interest rate swap termination ...... — 8,992 —
Asset impairment ............................................... — — 174,879
Loss from operations before income taxes ............................ (199,429) (23,736) (298,509)
Income tax benefit .............................................. (29,939) (9,028) (103,818)
Net loss ....................................................... $(169,490) $(14,708) $(194,691)
Year Ended December 31, 2011 Compared to Year Ended December 31, 2010
Our Corporate/Other segment is not a business operating segment. It is added to our reportable segments to
reconcile to our consolidated results. The Corporate/Other segment includes costs that are excluded from the
calculation of segment pretax income because they are not managed within the reportable segments.
Our operating results for the year ended December 31, 2011 were impacted by a $181 million pretax
expense related to the judgment imposed in the AmCareco litigation, $25.2 million in pretax costs related to our
G&A cost reduction efforts, partially reduced by a $6.8 million benefit from litigation reserve true-ups. See
“—Consolidated Results” for more information regarding the decision rendered in the AmCareco litigation.
Our operating results for the year ended December 31, 2010 included $61.2 million in pretax costs relating
to our operations strategy and other cost management initiatives, $9.0 million in early debt extinguishment and
related interest rate swap termination costs reduced by a $46.5 million benefit from litigation reserve true-ups.
See Note 2 for more information regarding the litigation reserve true-ups. See “—Liquidity and Capital
Resources—Capital Structure—Termination of Amortizing Financing Facility” for additional information
regarding the early debt extinguishment charge.
81