Humana 2015 Annual Report Download - page 68
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60
Depreciation and Amortization
Depreciation and amortization for 2014 totaled $333 million, unchanged from 2013.
Interest Expense
Interest expense was $192 million for 2014 compared to $140 million for 2013, an increase of $52 million, or
37.1%. In September 2014, we issued $400 million of 2.625% senior notes due October 1, 2019, $600 million of 3.85%
senior notes due October 1, 2024 and $750 million of 4.95% senior notes due October 1, 2044. In October 2014, we
redeemed the $500 million 6.45% senior unsecured notes due June 1, 2016, at 100% of the principal amount plus
applicable premium for early redemption and accrued and unpaid interest to the redemption date, We recognized a loss
on extinguishment of debt of approximately $37 million in October 2014 for the redemption of these notes.
Income Taxes
Our effective tax rate during 2014 was 47.2% compared to the effective tax rate of 35.9% in 2013. The non-
deductible nature of the health insurance industry fee levied on the insurance industry beginning in 2014 as mandated
by the Health Care Reform Law increased our effective tax rate by approximately 9.4 percentage points for 2014.
Retail Segment
Change
2014 2013 Members Percentage
Membership:
Medical membership:
Individual Medicare Advantage 2,427,900 2,068,700 359,200 17.4%
Group Medicare Advantage 489,700 429,100 60,600 14.1%
Medicare stand-alone PDP 3,994,000 3,275,900 718,100 21.9%
Total Retail Medicare 6,911,600 5,773,700 1,137,900 19.7%
Individual commercial (a) 1,148,100 600,100 548,000 91.3%
State-based Medicaid 316,800 85,500 231,300 270.5%
Total Retail medical members 8,376,500 6,459,300 1,917,200 29.7%
Individual specialty membership (b) 1,165,800 1,042,500 123,300 11.8%
(a) Individual commercial medical membership includes Medicare Supplement members.
(b) Specialty products include dental, vision, and other supplemental health and financial protection products.
Members included in these products may not be unique to each product since members have the ability to enroll
in multiple products.