Humana 2015 Annual Report Download - page 121
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Humana Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
113
Benefits expense excluded from the previous table was as follows for the years ended December 31, 2015, 2014
and 2013:
2015 2014 2013
(in millions)
Premium deficiency reserve for short-duration policies $ 176 $ — $ —
Military services 12 11 (27)
Future policy benefits (80) 32 354
Total $ 108 $ 43 $ 327
In the fourth quarter of 2015, we recognized a premium deficiency reserve for our individual commercial medical
business compliant with the Health Care Reform Law associated with the 2016 coverage year as discussed in more
detail in Note 7.
Military services benefits expense for 2015 and 2014 reflect expenses associated with our contracts with the
Veterans Administration. Military services benefits expense for 2013 reflects the beneficial effect of a favorable
settlement of contract claims with the DoD partially offset by expenses associated with our contracts with the Veterans
Administration.
The decrease in benefits expense associated with future policy benefits payable in 2015 primarily reflects the
release of reserves as individual commercial medical members transitioned to plans compliant with the Health Care
Reform Law. The higher benefits expense associated with future policy benefits payable during 2013 relates to reserve
strengthening for our closed block of long-term care insurance policies acquired in connection with the 2007 KMG
America Corporation, or KMG, acquisition more fully described in Note 18.
11. INCOME TAXES
The provision for income taxes consisted of the following for the years ended December 31, 2015, 2014 and 2013:
2015 2014 2013
(in millions)
Current provision:
Federal $ 1,067 $ 1,006 $ 595
States and Puerto Rico 90 81 53
Total current provision 1,157 1,087 648
Deferred (benefit) provision (2)(64)42
Provision for income taxes $ 1,155 $ 1,023 $ 690