United Healthcare 2015 Annual Report Download - page 81
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The acquisition date fair values and weighted-average useful lives assigned to finite-lived intangible assets
acquired in business combinations consisted of the following by year of acquisition:
2015 2014
(in millions, except years)
Fair
Value
Weighted-
Average
Useful Life
Fair
Value
Weighted-
Average
Useful Life
Customer-related ............................................ $5,518 19 years $314 14 years
Trademarks and technology .................................... 194 4years 148 6 years
Other ...................................................... — 2 14years
Total acquired finite-lived intangible assets ....................... $5,712 19 years $464 11 years
Estimated full year amortization expense relating to intangible assets for each of the next five years ending
December 31 is as follows:
(in millions)
2016 ................................................................................. $808
2017 ................................................................................. 772
2018 ................................................................................. 668
2019 ................................................................................. 612
2020 ................................................................................. 543
Amortization expense relating to intangible assets for December 31, 2015, 2014 and 2013 was $650 million,
$524 million and $519 million, respectively.
8. Medical Costs Payable
The following table shows the components of the change in medical costs payable for the years ended
December 31:
(in millions) 2015 2014 2013
Medical costs payable, beginning of period ............................ $ 12,040 $ 11,575 $ 11,004
Reported medical costs:
Current year ................................................ 104,195 94,053 90,339
Prior years ................................................. (320) (420) (680)
Total reported medical costs ....................................... 103,875 93,633 89,659
Claim payments:
Payments for current year ..................................... (90,630) (82,750) (79,358)
Payments for prior year ....................................... (10,955) (10,418) (9,730)
Total claim payments ............................................. (101,585) (93,168) (89,088)
Medical costs payable, end of period ................................. $ 14,330 $ 12,040 $ 11,575
For the years ended December 31, 2015 and 2014, the favorable medical cost reserve development was due to a
number of individual factors that were not material. The net favorable development for the year ended
December 31, 2013 was primarily driven by lower than expected health system utilization levels.
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