United Healthcare 2007 Annual Report Download - page 86

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Historical financial data as of and for the years ended December 31, 2006 and 2005 was revised to reflect our
new segment operating and financial reporting structure.
Factors used in determining our reporting segments include the nature of operating activities, economic
characteristics, existence of separate senior management teams and the type of information presented to the
Company’s chief operating decision-maker to evaluate our results of operations.
Our accounting policies for business segment operations are the same as those described in the Summary of
Significant Accounting Policies (See Note 2). Transactions between business segments principally consist of
customer service and transaction processing services that Health Care Services provides to OptumHealth, certain
product offerings sold to Health Care Services customers by OptumHealth, sales of pharmacy benefit products
and services to Health Care Services by Prescription Solutions and sales of medical benefits cost, quality and
utilization data and predictive modeling to Health Care Services by Ingenix. These transactions are recorded at
management’s estimate of fair value. All intersegment transactions are eliminated in consolidation. Assets and
liabilities that are jointly used are assigned to each segment using estimates of pro-rata usage. Cash and
investments are assigned such that each segment has at least minimum specified levels of regulatory capital or
working capital for non-regulated businesses.
Substantially all of our operations are conducted in the United States. In accordance with accounting principles
generally accepted in the United States, segments with similar economic characteristics may be combined. The
financial results of Commercial Markets, Ovations and AmeriChoice have been aggregated in the Health Care
Services segment column in the following tables because these businesses have similar economic characteristics
and have similar products and services, types of customers, distribution methods and operational processes, and
operate in a similar regulatory environment. These businesses also share significant common assets, including
our contracted networks of physicians, health care professionals, hospitals and other facilities, information
technology infrastructure and other resources.
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