United Healthcare 2012 Annual Report Download - page 103

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the procedural status of the dispute, the novel legal issues presented (including the legal basis for the majority of
the alleged violations), the inherent difficulty in predicting regulatory fines and penalties, and the various
remedies and levels of judicial review available to the Company in the event a fine or penalty is assessed.
Government Investigations, Audits and Reviews
The Company has been and is currently involved in various governmental investigations, audits and reviews.
These include routine, regular and special investigations, audits and reviews by CMS, state insurance and health
and welfare departments, state attorneys general, the Office of the Inspector General (OIG), the Office of
Personnel Management, the Office of Civil Rights, the Federal Trade Commission (FTC), U.S. Congressional
committees, the U.S. Department of Justice (DOJ), U.S. Attorneys, the Securities and Exchange Commission
(SEC), the Brazilian securities regulator — Comissão de Valores Mobiliários (CVM), IRS, SRF, the U.S.
Department of Labor (DOL), the FDIC and other governmental authorities. Certain of the Company’s businesses
have been reviewed or are currently under review, including for, among other things, compliance with coding
and other requirements under the Medicare risk-adjustment model.
In February 2012, CMS announced a final RADV audit and payment adjustment methodology and that it will
conduct RADV audits beginning with the 2011 payment year. These audits involve a review of medical records
maintained by care providers and may result in retrospective adjustments to payments made to health plans. CMS
has not communicated how the final payment adjustment under its methodology will be implemented.
Government actions can result in assessment of damages, civil or criminal fines or penalties, or other sanctions,
including loss of licensure or exclusion from participation in government programs and could have a material
effect on the Company’s results of operations, financial position and cash flows.
13. Segment Financial Information
Factors used to determine the Company’s reportable 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 its results of operations. Reportable segments with
similar economic characteristics are combined.
The following is a description of the types of products and services from which each of the Company’s four
reportable segments derives its revenues:
•UnitedHealthcare includes the combined results of operations of UnitedHealthcare Employer & Individual,
UnitedHealthcare Medicare & Retirement, UnitedHealthcare Community & State and UnitedHealthcare
International because they have similar economic characteristics, products and services, customers,
distribution methods and operational processes and operate in a similar regulatory environment. The U.S.
businesses also share significant common assets, including a contracted network of physicians, health care
professionals, hospitals and other facilities, information technology infrastructure and other resources.
UnitedHealthcare Employer & Individual offers an array of consumer-oriented health benefit plans and
services for large national employers, public sector employers, mid-sized employers, small businesses and
individuals nationwide and will serve TRICARE West Region members beginning April 1, 2013.
UnitedHealthcare Medicare & Retirement provides health care coverage and health and well-being services
to individuals age 50 and older, addressing their unique needs for preventive and acute health care services
as well as services dealing with chronic disease and other specialized issues for older individuals.
UnitedHealthcare Community & State provides health plans and care programs to beneficiaries of acute and
long-term care Medicaid plans, the Children’s Health Insurance Program (CHIP), Special Needs Plans,
Medicare-Medicaid Eligible beneficiaries eligible for both Medicare and Medicaid and other federal, state
and community health care programs. UnitedHealthcare International is a diversified global health services
business with a variety of offerings, including international commercial health and dental benefits.
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