Quest Diagnostics 2012 Annual Report Download - page 116

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F- 43
19. BUSINESS SEGMENT INFORMATION
Clinical testing is an essential element in the delivery of healthcare services. Physicians use clinical testing to assist in
the detection, diagnosis, evaluation, monitoring and treatment of diseases and other medical conditions. The Company's DIS
business includes its clinical testing operations which are generally categorized as clinical laboratory testing and anatomic
pathology services. Clinical laboratory testing generally is performed on whole blood, serum, plasma and other body fluids,
such as urine, and specimens such as microbiology samples. Anatomic pathology services are principally for the detection of
cancer and are performed on tissues, such as biopsies, and other samples, such as human cells. Customers of the DIS business
include patients, physicians, hospitals, employers, governmental institutions and other commercial clinical laboratories. The
DIS business accounted for greater than 90% of net revenues from continuing operations in 2012, 2011 and 2010.
All other operating segments are included in the Company's DS business and consist of its risk assessment services,
clinical trials testing, healthcare information technology, and diagnostics products businesses. The Company's risk assessment
services business provides underwriting support services to the life insurance industry including electronic data collection,
specimen collection and paramedical examinations, laboratory testing, medical record retrieval, case management, motor
vehicle reports, telephone inspections, prescription histories and credit checks. The Company's clinical trials testing business
provides clinical testing performed in connection with clinical research trials on new drugs, vaccines and certain medical
devices. The Company's healthcare information technology business is a provider of clinical connectivity and data management
solutions for healthcare organizations, and clinicians that can help improve patient care and medical practice. The Company's
diagnostics products business manufactures and markets products that enable healthcare professionals to make healthcare
diagnoses, including products for testing for the professional market.
During the second quarter of 2011, the Company acquired Athena and Celera. Athena is included in the Company's
DIS business. The majority of Celera's operations are included in the Company's DIS business, with the remainder in other
operating segments.
On April 19, 2006, the Company decided to discontinue NID’s operations. The Company completed the sale of
OralDNA during the fourth quarter of 2012 and committed to a plan to sell HemoCue in December 2012. The results of
operations for NID, OralDNA and HemoCue have been classified as discontinued operations for all periods presented. See Note
18 for further details regarding discontinued operations.
At December 31, 2012, substantially all of the Company’s services are provided within the United States, and
substantially all of the Company’s assets are located within the United States.
The following table is a summary of segment information for the years ended December 31, 2012, 2011 and 2010.
Segment asset information is not presented since it is not used by the chief operating decision maker at the operating segment
level. Operating earnings (loss) of each segment represents net revenues less directly identifiable expenses to arrive at operating
income for the segment. Certain general operating expenses in 2011 have been reclassified to conform to the current year
presentation of the Company's DIS business. General management and administrative corporate expenses, including
amortization of intangible assets and the Medi-Cal charge in the first quarter of 2011 of $236 million (see Note 17), are
included in general corporate expenses below. The accounting policies of the segments are the same as those of the Company as
set forth in Note 2.
QUEST DIAGNOSTICS INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – CONTINUED
(dollars in thousands unless otherwise indicated)