United Healthcare 2008 Annual Report Download - page 14

sales for large employer and public sector groups. UnitedHealthcare’s direct distribution efforts are generally
limited to the individual market, portions of the large employer group and public sector markets, and cross-
selling of specialty products to existing customers.
Ovations
Ovations provides health and well-being services for individuals age 50 and older, addressing their unique needs
for preventive and acute health care services as well as for services dealing with chronic disease and other
specialized issues for older individuals. Ovations is fully dedicated to this market segment, as it provides
products and services in all 50 states, the District of Columbia, and the U.S. territories. Ovations participates
nationally in the Medicare program, offering a wide-ranging spectrum of Medicare products, including Medigap
products that supplement traditional fee-for-service coverage, more traditional health-plan-type programs under
Medicare Advantage, Medicare Part D prescription drug coverage, and special offerings for beneficiaries who are
chronically ill and/or Medicare and Medicaid dual-eligible.
Ovations has extensive capabilities and experience with distribution, including direct marketing to consumers on
behalf of its key clients – AARP, the nation’s largest membership organization dedicated to the needs of people
age 50 and over, state and U.S. government agencies and employer groups. Ovations also has distinct pricing,
underwriting and clinical program management, and marketing capabilities dedicated to risk-based health
products and services in the senior and geriatric markets.
We currently have a number of contracts with Centers for Medicare & Medicaid Services (CMS), which
primarily relate to the Medicare health benefit programs authorized under the 2003 Medicare Modernization Act.
Beginning January 1, 2006, we began serving as a plan sponsor offering Medicare Part D prescription drug
insurance coverage. Premium revenues from CMS were 25% of our total consolidated revenues for the year
ended December 31, 2008, most of which were generated by Ovations.
Ovations is organized into four major groups: SecureHorizons, Ovations Part D, Insurance Solutions and
Evercare.
SecureHorizons. SecureHorizons provides health care coverage for seniors and other eligible Medicare
beneficiaries primarily through the Medicare Advantage program administered by CMS. SecureHorizons offers
Medicare Advantage HMO plans, preferred provider organization (PPO) plans, Special Needs Plans,
Point-of-Service (POS) plans, and Private-Fee-for-Service plans. Under the Medicare Advantage programs,
SecureHorizons provides health insurance coverage to eligible Medicare beneficiaries in exchange for a fixed
monthly premium per member from CMS that varies based on the geographic areas in which members reside,
demographic factors such as age, gender, and institutionalized status, and the health status of the individual. Most
products are offered under the “AARP Medicare Complete provided through SecureHorizons” brand name.
SecureHorizons offers Medicare Advantage products in all 50 states. As of December 31, 2008, Ovations had
approximately 1.5 million enrolled individuals in its Medicare Advantage products, including approximately
245,000 individuals served by Evercare.
Ovations Part D. Ovations provides the Medicare prescription drug benefit (Part D) to beneficiaries throughout
the United States and its territories. Among the several Part D plans it offers, Ovations provides Medicare Part D
coverage plans with the AARP brand. Ovations provides Part D drug coverage through its Medicare Advantage
program, Special Needs Plans (covering individuals who live in an institutional long-term care setting,
individuals dual-eligible for Medicaid and Medicare services or individuals with severe or disabling chronic
conditions) and stand-alone Part D plans. As of December 31, 2008, Ovations had enrolled approximately
5.5 million members in the Part D program, including approximately 4.1 million members in the stand-alone Part
D plans and approximately 1.4 million members in Medicare Advantage plans incorporating Part D coverage.
Insurance Solutions. Insurance Solutions offers a range of health insurance products and services to AARP
members, and has expanded the scope of services and programs offered over the past several years. Ovations
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