Health Net 2013 Annual Report Download - page 85

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expenses associated with providing services under the United Administrative Services Agreements and Claims
Servicing Agreements were $34.5 million and $145.9 million, respectively, for the year ended December 31, 2011.
Corporate/Other
The following table summarizes the Corporate/Other segment for the years ended December 31, 2013, 2012 and
2011:
Year Ended December 31,
2013 2012 2011
(Dollars in thousands)
Costs included in health plan services costs ................................ $ — $ (783) $ (6,799)
Costs included in government contract costs............................... 5,138 5,863 6,496
Costs included in G&A................................................................ 6,877 36,892 199,732
Early debt extinguishment and related interest rate swap
termination .............................................................................. — — —
Loss from continuing operations before income taxes ................ (12,015)(41,972)(199,429)
Income tax benefit........................................................................ (4,694)(10,916)(29,939)
Loss from continuing operations ................................................. $(7,321) $ (31,056) $ (169,490)
Our Corporate/Other segment is not a business operating segment. It is added to our reportable segments to
reconcile to our consolidated results. The Corporate/Other segment includes costs that are excluded from the calculation
of segment pretax income because they are not managed within the reportable segments.
Year Ended December 31, 2013 Compared to Year Ended December 31, 2012
The operating results in our Corporate/Other segment for the year ended December 31, 2013 were impacted by
$12.0 million in pretax costs, primarily severance expenses related to our continuing efforts to address scale issues.
Our operating results for the year ended December 31, 2012 were impacted primarily by $35.6 million in pretax
costs related to our G&A cost reduction efforts, $1.3 million in pretax litigation-related expenses net of insurance
recoveries and $5.0 million in pretax costs related to early termination of a medical management contract.
Year Ended December 31, 2012 Compared to Year Ended December 31, 2011
Our operating results for the year ended December 31, 2012 were impacted primarily by $35.6 million in pretax
costs related to our G&A cost reduction efforts, $1.3 million in pretax litigation-related expenses net of insurance
recoveries and $5.0 million in pretax costs related to early termination of a medical management contract. Our
operating results for the year ended December 31, 2011 were impacted by a $181 million pretax expense related to the
judgment imposed in the AmCareco litigation, $25.2 million in pretax costs related to our G&A cost reduction efforts,
partially reduced by a $6.8 million benefit from litigation reserve reductions. See Note 13 to our consolidated financial
statements under the heading "AmCareco Judgment" for more information regarding the AmCareco litigation.
LIQUIDITY AND CAPITAL RESOURCES
Market and Economic Conditions
Global markets continue to advance and interest rates are on the rise. The Federal Open Market Committee
remain accommodative but inflation and unemployment data are key factors for Federal Reserve action. The global
economy is showing some signs of improvement but market conditions continue to be challenging with elevated levels
of unemployment and volatility in both U.S. and international capital and credit markets. Market conditions could limit
our ability to timely replace maturing liabilities, or otherwise access capital markets for liquidity needs, which could
adversely affect our business, financial condition and results of operations. Furthermore, if our customer base
experiences cash flow problems and other financial difficulties, it could, in turn, adversely impact membership in our
plans. For example, our customers may modify, delay or cancel plans to purchase our products, may reduce the number
of individuals to whom they provide coverage, or may make changes in the mix of products purchased from us. In