United Healthcare 2009 Annual Report Download - page 38
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Operating costs for 2008 included $882 million for settlement of two class action lawsuits related to our
historical stock option practices and related legal costs, $350 million for the settlement of class action litigation
related to reimbursement for out-of-network medical services, $50 million related to estimated costs to conclude
a legal matter and $46 million for employee severance related to operating cost reduction initiatives and other
items, partially offset by a $185 million reduction in operating costs for proceeds from the sale of certain assets
and membership in the individual Medicare Advantage business in Nevada in May 2008.
Income Tax Rate
Our income tax rate for 2009 decreased primarily due to the favorable resolution of various historical state
income tax matters and the change to a premium tax in lieu of an income tax in one of the states in which we
operate, which increased operating costs and decreased income taxes.
Reporting Segments
We have four reporting segments:
• Health Benefits, which includes UnitedHealthcare, Ovations and AmeriChoice;
• OptumHealth;
• Ingenix; and
• Prescription Solutions.
Transactions between reporting segments principally consist of sales of pharmacy benefit products and services
to Health Benefits customers by Prescription Solutions, certain product offerings sold to Health Benefits
customers by OptumHealth, and consulting and other services sold to Health Benefits by Ingenix. These
transactions are recorded at management’s estimate of fair value. Intersegment transactions are eliminated in
consolidation.
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