Aetna 2013 Annual Report Download - page 88

Annual Report- Page 82
Notes to Consolidated Financial Statements
1. Organization
We conduct our operations in three business segments:
• Health Care consists of medical, pharmacy benefit management services, dental, behavioral health and
vision plans offered on both an Insured basis (where we assume all or a majority of the risk for medical and
dental care costs) and an employer-funded basis (where the plan sponsor under an administrative services
contract (“ASC”) assumes all or a majority of this risk) and emerging businesses products and services,
such as Accountable Care Solutions (“ACS”), that complement and enhance our medical products. Medical
products include point-of-service (“POS”), preferred provider organization (“PPO”), health maintenance
organization (“HMO”) and indemnity benefit (“Indemnity”) plans. Medical products also include health
savings accounts (“HSAs”) and Aetna HealthFund®, consumer-directed health plans that combine
traditional POS or PPO and/or dental coverage, subject to a deductible, with an accumulating benefit
account (which may be funded by the plan sponsor and/or the member in the case of HSAs). We also offer
Medicare and Medicaid products and services and other medical products, such as medical management
and data analytics services, medical stop loss insurance, workers' compensation administrative services and
products that provide access to our provider network in select geographies.
• Group Insurance primarily includes group life insurance and group disability products. Group life
insurance products are offered on an Insured basis, and include basic and supplemental group term life,
group universal life, supplemental or voluntary programs and accidental death and dismemberment
coverage. Group disability products consist primarily of short-term and long-term disability products (and
products which combine both), which are offered to employers on both an Insured and an ASC basis, and
absence management services offered to employers, which include short-term and long-term disability
administration and leave management. Group Insurance also includes long-term care products that were
offered primarily on an Insured basis, which provide benefits covering the cost of care in private home
settings, adult day care, assisted living or nursing facilities. We no longer solicit or accept new long-term
care customers.
• Large Case Pensions manages a variety of retirement products (including pension and annuity products)
primarily for tax-qualified pension plans. These products provide a variety of funding and benefit payment
distribution options and other services. Large Case Pensions also includes certain discontinued products
(refer to Note 20 beginning on page 137 for additional information).
Our three business segments are distinct businesses that offer different products and services. Our Chief Executive
Officer evaluates financial performance and makes resource allocation decisions at these segment levels. The
accounting policies of the segments are the same as those described in the summary of significant accounting
policies in Note 2, below. We evaluate the performance of these business segments based on operating earnings
(net income or loss attributable to Aetna, excluding net realized capital gains or losses and other items, if any) (refer
to Note 19 beginning on page 135 for segment financial information).
On May 7, 2013 (the “Effective Date”), we completed the acquisition of Coventry in a transaction valued at
approximately $8.7 billion, including the fair value of Coventry's outstanding debt (refer to Note 3 beginning on
page 91 for additional information).