EX-99.1 2 moh-06302018xer.htm EXHIBIT 99.1 Exhibit

MOH Reports Second Quarter 2018 Results
Page 1
July 31, 2018

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News Release

Contact:
Ryan Kubota
Investor Relations
562-435-3666, ext. 119057

MOLINA HEALTHCARE ANNOUNCES SECOND QUARTER 2018 RESULTS AND INCREASES FISCAL YEAR 2018 GUIDANCE
Net income of $3.02 per diluted share on a GAAP basis in the second quarter of 2018, compared with $1.64 per diluted share in the first quarter of 2018
Second quarter 2018 results include a net benefit of $0.83 per diluted share for non-run rate items, primarily relating to the 2017 Marketplace risk adjustment
Premium revenue increases $191 million, or 4.4%, in the second quarter of 2018 compared with the first quarter of 2018
Medical care ratio of 85.3% in the quarter
General and administrative expense ratio of 6.9% in the quarter
Net profit margin of 4.1% in the quarter and 3.2% year to date
2018 guidance increases by $3.00 per diluted share at the midpoint to a range of $7.15 - $7.35 net income per diluted share on a GAAP basis
2018 guidance includes the net benefit of $0.96 per diluted share for the non-run rate items recorded in the first half of the year
Long Beach, California (July 31, 2018) - Molina Healthcare, Inc. (NYSE: MOH) today reported its financial results for the second quarter of 2018.
Our second quarter results are a strong indication that the early stages of our margin recovery and sustainability plan are working,” said Joe Zubretsky, President and Chief Executive Officer. “Our focus on managed care fundamentals and a more rigorous performance management process is reflected in our improved earnings.”
We believe that the sequential comparison of our 2018 second quarter performance with our 2018 first quarter performance is the most useful indicator of our business progress. Significant items impacting the quarter are presented in a table later in this press release.
Second Quarter of 2018 Compared With First Quarter of 2018
Net income increased to $202 million, from $107 million in the first quarter of 2018. Net income per diluted share increased to $3.02, from $1.64 in the first quarter of 2018.
Overall, the medical care ratio improved to 85.3%, from 86.1% in the first quarter of 2018. Excluding the combined benefit of the 2017 Marketplace risk adjustment and cost sharing reduction (CSR) reimbursement, the medical care ratio would have been 87.0% in the second quarter of 2018, compared with 87.2% in the

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MOH Reports Second Quarter 2018 Results
Page 2
July 31, 2018

first quarter of 2018. The sequential improvement in the overall medical care ratio was due to a decrease in the Medicaid medical care ratio partially offset by a seasonally higher Marketplace medical care ratio.
The Medicaid medical care ratio decreased to 89.8%, from 90.8% in the first quarter of 2018. Improved performance at the Washington, California, Texas, New Mexico and Illinois health plans, partially offset by a decline in performance at the Ohio and Florida health plans, drove the decrease in the medical care ratio for Medicaid.
The Marketplace medical care ratio increased to 57.4%, from 50.6% in the first quarter of 2018. Excluding the combined net benefit of the 2017 risk adjustment and CSR, the Marketplace medical care ratio would have been 68.4% in the second quarter of 2018, compared with 63.5% in the first quarter of 2018.
The general and administrative (G&A) expense ratio decreased to 6.9%, from 7.6% in the first quarter of 2018, due to increased revenue and continuing G&A cost containment. Excluding the impact of Marketplace broker commissions and exchange fees in both periods, the G&A ratio decreased to 6.2%, from 6.8% in the first quarter of 2018.
Renewal of Medicaid Contracts
Year to date in 2018, we renewed Medicaid contracts in Washington, Florida and Puerto Rico as follows:
In May 2018, our Washington health plan was selected to negotiate and enter into a managed care contract for the eight remaining regions of the state’s Apple Health Integrated Managed Care program, in addition to the two regions previously awarded to us. As of June 30, 2018, we served approximately 742,000 Medicaid members in Washington.
In June 2018, our Florida health plan was awarded Medicaid Managed Care contracts in Regions 8 and 11 of the Florida Statewide Medicaid Managed Care Invitation to Negotiate, beginning in 2019. As of June 30, 2018, we served approximately 96,000 Medicaid members in those regions.
In July 2018, our Puerto Rico health plan was selected to be one of the organizations to administer the Commonwealth’s new Medicaid Managed Care contract. Services under the new contract, currently expected to begin on November 1, 2018, would cover the entire island. As of June 30, 2018, we served approximately 326,000 Medicaid members in the East and Southwest regions of Puerto Rico.
Capital Plan Progress
In the second quarter of 2018, we repaid $300 million outstanding under the revolving credit facility. In addition, we repaid $96 million aggregate principal amount of our 1.125% cash convertible senior notes due 2020 and entered into privately negotiated termination agreements to terminate the respective portions of the call options and warrants. Year to date, we have reduced the principal amount of outstanding debt by $493 million.
Sale of Molina Medicaid Solutions Segment
In June 2018, we entered into a definitive agreement to sell Molina Medicaid Solutions (MMS) to DXC Technology Company. The divestiture, expected to close in the third quarter of 2018, is subject to the satisfaction of customary closing conditions and the receipt of certain third party consents and regulatory approvals. We expect the net cash selling price for the equity interests of MMS to approximate $220 million after certain adjustments.
Second Quarter of 2018 Compared With Second Quarter of 2017
Net income for the second quarter of 2018 was $202 million, compared with a net loss of $230 million for the second quarter of 2017. Net income per diluted share was $3.02 for the second quarter of 2018 compared with net loss per diluted share of $4.10 reported for the second quarter of 2017. In the second quarter of 2017, we recorded significant medical care costs relating to prior year dates of service in excess of historical expectations, and Marketplace-related premium deficiency reserves and changes in estimates relating to prior year dates of service. In addition, we recorded significant impairment and restructuring charges.

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MOH Reports Second Quarter 2018 Results
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July 31, 2018

2018 Revised Guidance
The following table summarizes 2018 Revised Guidance (1):
Premium revenue
 
~ $17.5B

Service revenue
 
~ $475M

Premium tax revenue
 
~ $415M

Health insurer fees reimbursed
 
~ $325M

Investment income and other revenue
 
~ $125M

Total revenue
 
~ $18.8B

Medical care costs
 
~ $15.2B

Medical care ratio (2)
 
~ 87%

Cost of service revenue
 
~ $430M

General and administrative expenses
 
~ $1.4B

G&A ratio (3)
 
~ 7.4%

Premium tax expenses
 
~ $415M

Health insurer fees
 
~ $345M

Depreciation and amortization
 
~ $100M

Restructuring and separation costs
 
~ $30M

Interest expense and other income, net
 
~ $140M

Income before income taxes
 
$730M - $745M

Net income
 
$471M - $484M

EBITDA (4)
 
$968M - $985M

Effective tax rate
 
35% - 36%

Net profit margin (3)
 
2.5% - 2.6%

Diluted weighted average shares
 
~ 65.9M

Net income per share
 
$7.15 - $7.35

Adjusted net income per share (4)
 
$7.39 - $7.59

End-of-year Marketplace membership
 
354,000

End-of-year Medicaid and Medicare membership
 
3,569,000

__________________
(1)
All amounts are estimates; actual results may differ materially. See the Company’s risk factors as discussed in its 2017 Form 10-K and other filings and the statements below in this press release after the heading “Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995.”
(2)
Medical care ratio represents medical care costs as a percentage of premium revenue.
(3)
G&A ratio represents general and administrative expenses as a percentage of total revenue. Net profit margin represents net income as a percentage of total revenue.
(4)
See reconciliation of non-GAAP financial measures at the end of this release.

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MOH Reports Second Quarter 2018 Results
Page 4
July 31, 2018

Conference Call
Management will host a conference call and webcast to discuss Molina Healthcare’s second quarter 2018 results at 8:00 a.m. Eastern time on Wednesday, August 1, 2018. The number to call for the interactive teleconference is (877) 883-0383 and entering confirmation number 7567890. A telephonic replay of the conference call will be available through Wednesday, August 8, 2018, by dialing (877) 344-7529 and entering confirmation number 10121865. A live audio broadcast of this conference call will be available on Molina Healthcare’s website, molinahealthcare.com. A 30-day online replay will be available approximately an hour following the conclusion of the live broadcast.
About Molina Healthcare
Molina Healthcare, Inc., a FORTUNE 500 company, provides managed health care services under the Medicaid and Medicare programs and through the state insurance marketplaces. Through its locally operated health plans, Molina Healthcare served approximately 4.1 million members as of June 30, 2018. For more information about Molina Healthcare, please visit molinahealthcare.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
This earnings release contains “forward-looking statements” regarding the Company’s 2018 revised guidance, as well as its plans, expectations, and anticipated future events. Actual results could differ materially due to numerous known and unknown risks and uncertainties. Those known risks and uncertainties include, but are not limited to, the following:
the success of the Company’s profit improvement and maintenance initiatives, including the timing and amounts of the benefits realized, and administrative and medical cost savings achieved;
the numerous political and market-based uncertainties associated with the Affordable Care Act (the “ACA”) or “Obamacare;”
the market dynamics surrounding the ACA Marketplaces, including but not limited to uncertainties associated with risk adjustment requirements, the potential for disproportionate enrollment of higher acuity members, the discontinuation of premium tax credits, and the adequacy of agreed rates;
subsequent adjustments to reported premium revenue based upon subsequent developments or new information, including changes to estimated amounts payable or receivable related to Marketplace risk adjustment;
effective management of the Company’s medical costs;
the Company’s ability to predict with a reasonable degree of accuracy utilization rates, including utilization rates associated with seasonal flu patterns or other newly emergent diseases;
significant budget pressures on state governments and their potential inability to maintain current rates, to implement expected rate increases, or to maintain existing benefit packages or membership eligibility thresholds or criteria;
the full reimbursement of the ACA health insurer fee, or HIF;
the success of the Company’s efforts to retain existing or awarded government contracts, including those in New Mexico and Texas, and those for Regions 8 and 11 in Florida, including the success of any protest filings or defenses;
the Company’s ability to manage its operations, including maintaining and creating adequate internal systems and controls relating to authorizations, approvals, provider payments, and the overall success of its care management initiatives;
the Company’s ability to consummate and realize benefits from divestitures and acquisitions, including the timely closing of the MMS divestiture;
the Company’s receipt of adequate premium rates to support increasing pharmacy costs, including costs associated with specialty drugs and costs resulting from formulary changes that allow the option of higher-priced non-generic drugs;
the Company’s ability to operate profitably in an environment where the trend in premium rate increases lags behind the trend in increasing medical costs;
the interpretation and implementation of federal or state medical cost expenditure floors, administrative cost and profit ceilings, premium stabilization programs, profit sharing arrangements, and risk adjustment provisions and requirements;

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MOH Reports Second Quarter 2018 Results
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July 31, 2018

the Company’s estimates of amounts owed for such cost expenditure floors, administrative cost and profit ceilings, premium stabilization programs, profit-sharing arrangements, and risk adjustment provisions;
the Medicaid expansion medical cost corridors in California, New Mexico, and Washington, and any other retroactive adjustment to revenue where methodologies and procedures are subject to interpretation or dependent upon information about the health status of participants other than Molina members;
the interpretation and implementation of at-risk premium rules and state contract performance requirements regarding the achievement of certain quality measures, and the Company’s ability to recognize revenue amounts associated therewith;
cyber-attacks or other privacy or data security incidents resulting in an inadvertent unauthorized disclosure of protected health information;
the success of the Company’s health plan in Puerto Rico, including the resolution of the debt crisis and the effect of the PROMESA law, and the impact of any future significant weather events;
the success and renewal of the Company’s duals demonstration programs in California, Illinois, Michigan, Ohio, South Carolina, and Texas;
the accurate estimation of incurred but not reported or paid medical costs across the Company’s health plans;
efforts by states to recoup previously paid and recognized premium amounts;
complications, member confusion, or enrollment backlogs related to the annual renewal of Medicaid coverage;
government audits and reviews, or potential investigations, and any fine, sanction, enrollment freeze, monitoring program, or premium recovery that may result therefrom;
changes with respect to the Company’s provider contracts and the loss of providers;
approval by state regulators of dividends and distributions by the Company’s health plan subsidiaries;
changes in funding under the Company’s contracts as a result of regulatory changes, programmatic adjustments, or other reforms;
high dollar claims related to catastrophic illness;
the favorable resolution of litigation, arbitration, or administrative proceedings, including litigation involving the ACA to which we ourselves are not a direct party;
the relatively small number of states in which we operate health plans, including the greater scale and revenues of the Company’s California, Ohio, Texas, and Washington health plans;
the availability of adequate financing on acceptable terms to fund and capitalize the Company’s expansion and growth, repay the Company’s outstanding indebtedness at maturity and meet its liquidity needs, including the interest expense and other costs associated with such financing;
the Company’s failure to comply with the financial or other covenants in its credit agreements or the indentures governing its outstanding notes;
the sufficiency of the Company’s funds on hand to pay the amounts due upon conversion or maturity of its outstanding notes;
the failure of a state in which we operate to renew its federal Medicaid waiver;
changes generally affecting the managed care or Medicaid management information systems industries;
increases in government surcharges, taxes, and assessments, including but not limited to the deductibility of certain compensation costs;
newly emergent viruses or widespread epidemics, public catastrophes or terrorist attacks, and associated public alarm;
the unexpected loss of the leadership of one or more of our senior executives;
increasing competition and consolidation in the Medicaid industry;

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MOH Reports Second Quarter 2018 Results
Page 6
July 31, 2018

and numerous other risk factors, including those discussed in the Company’s periodic reports and filings with the Securities and Exchange Commission. These reports can be accessed under the investor relations tab of the Company’s website or on the SEC’s website at sec.gov. Given these risks and uncertainties, the Company can give no assurances that its forward-looking statements will prove to be accurate, or that any other results or events projected or contemplated by its forward-looking statements will in fact occur, and the Company cautions investors not to place undue reliance on these statements. All forward-looking statements in this release represent the Company’s judgment as of July 31, 2018, and the Company disclaims any obligation to update any forward-looking statements to conform the statement to actual results or changes in its expectations.

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MOH Reports Second Quarter 2018 Results
Page 7
July 31, 2018

MOLINA HEALTHCARE, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2018
 
2017
 
2018
 
2017
 
(Dollar amounts in millions, except per-share amounts)
Revenue:
 
 
 
 
 
 
 
Premium revenue
$
4,514

 
$
4,740

 
$
8,837

 
$
9,388

Service revenue
127

 
129

 
261

 
260

Premium tax revenue
106

 
114

 
210

 
225

Health insurer fees reimbursed
104

 

 
165

 

Investment income and other revenue
32

 
16

 
56

 
30

Total revenue
4,883

 
4,999

 
9,529

 
9,903

Operating expenses:
 
 
 
 
 
 
 
Medical care costs
3,850

 
4,491

 
7,572

 
8,602

Cost of service revenue
118

 
124

 
238

 
246

General and administrative expenses
335

 
405

 
687

 
844

Premium tax expenses
106

 
114

 
210

 
225

Health insurer fees
99

 

 
174

 

Depreciation and amortization
25

 
37

 
51

 
76

Impairment losses

 
72

 

 
72

Restructuring and separation costs
8

 
43

 
33

 
43

Total operating expenses
4,541

 
5,286

 
8,965

 
10,108

Operating income (loss)
342

 
(287
)
 
564

 
(205
)
Other expenses (income), net:
 
 
 
 
 
 
 
Interest expense
32

 
27

 
65

 
53

Other expense (income), net
5

 

 
15

 
(75
)
Total other expenses (income), net
37

 
27

 
80

 
(22
)
Income (loss) before income tax expense (benefit)
305

 
(314
)
 
484

 
(183
)
Income tax expense (benefit)
103

 
(84
)
 
175

 
(30
)
Net income (loss)
$
202

 
$
(230
)
 
$
309

 
$
(153
)
 
 
 
 
 
 
 
 
Net income (loss) per diluted share
$
3.02

 
$
(4.10
)
 
$
4.68

 
$
(2.74
)
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
66.7

 
56.2

 
66.0

 
56.1

 
 
 
 
 
 
 
 
Operating Statistics:
 
 
 
 
 
 
 
Medical care ratio
85.3
%
 
94.8
 %
 
85.7
%
 
91.6
 %
G&A ratio
6.9
%
 
8.1
 %
 
7.2
%
 
8.5
 %
Premium tax ratio
2.3
%
 
2.4
 %
 
2.3
%
 
2.3
 %
Effective income tax rate
33.8
%
 
26.8
 %
 
36.2
%
 
16.0
 %
Net profit (loss) margin
4.1
%
 
(4.6
)%
 
3.2
%
 
(1.5
)%



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MOH Reports Second Quarter 2018 Results
Page 8
July 31, 2018

MOLINA HEALTHCARE, INC.
UNAUDITED CONSOLIDATED BALANCE SHEETS
 
June 30,
 
December 31,
 
2018
 
2017
 
(In millions,
except per-share data)
ASSETS
Current assets:
 
 
 
Cash and cash equivalents
$
3,392

 
$
3,186

Investments
2,176

 
2,524

Restricted investments
80

 
169

Receivables
1,148

 
871

Prepaid expenses and other current assets
344

 
239

Derivative asset
657

 
522

Assets held for sale
230

 

Total current assets
8,027

 
7,511

Property, equipment, and capitalized software, net
276

 
342

Goodwill and intangible assets, net
201

 
255

Restricted investments
117

 
119

Deferred income taxes
114

 
103

Other assets
28

 
141

 
$
8,763

 
$
8,471

 
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
 
 
 
Medical claims and benefits payable
$
1,920

 
$
2,192

Amounts due government agencies
1,746

 
1,542

Accounts payable and accrued liabilities
754

 
366

Deferred revenue
193

 
282

Current portion of long-term debt
484

 
653

Derivative liability
657

 
522

Liabilities held for sale
66

 

Total current liabilities
5,820

 
5,557

Long-term debt
1,019

 
1,318

Lease financing obligations
198

 
198

Other long-term liabilities
68

 
61

Total liabilities
7,105

 
7,134

Stockholders’ equity:
 
 
 
Common stock, $0.001 par value, 150 shares authorized; outstanding: 62 shares at June 30, 2018 and 60 shares at December 31, 2017

 

Preferred stock, $0.001 par value; 20 shares authorized, no shares issued and outstanding

 

Additional paid-in capital
1,055

 
1,044

Accumulated other comprehensive loss
(11
)
 
(5
)
Retained earnings
614

 
298

Total stockholders’ equity
1,658

 
1,337

 
$
8,763

 
$
8,471


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MOH Reports Second Quarter 2018 Results
Page 9
July 31, 2018

MOLINA HEALTHCARE, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2018
 
2017
 
2018
 
2017
 
(In millions)
Operating activities:
 
 
 
 
 
 
 
Net income (loss)
$
202

 
$
(230
)
 
$
309

 
$
(153
)
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
 
 
 
 
 
 
 
Depreciation and amortization
36

 
47

 
73

 
96

Impairment losses

 
72

 

 
72

Deferred income taxes

 
(36
)
 
(6
)
 
(41
)
Share-based compensation
7

 
29

 
13

 
35

Non-cash restructuring costs

 

 
17

 

Amortization of convertible senior notes and lease financing obligations
6

 
8

 
13

 
16

Loss on debt extinguishment
5

 

 
15

 

Other, net
2

 
4

 
4

 
7

Changes in operating assets and liabilities:
 
 
 
 
 
 
 
Receivables
(232
)
 

 
(315
)
 
(32
)
Prepaid expenses and other current assets
58

 
(26
)
 
(181
)
 
(38
)
Medical claims and benefits payable
(104
)
 
151

 
(267
)
 
148

Amounts due government agencies
33

 
269

 
205

 
642

Accounts payable and accrued liabilities
30

 
(68
)
 
349

 
(18
)
Deferred revenue
(172
)
 
(178
)
 
(42
)
 
(32
)
Income taxes
49

 
(89
)
 
127

 
(30
)
Net cash (used in) provided by operating activities
(80
)
 
(47
)
 
314

 
672

Investing activities:
 
 
 
 
 
 
 
Purchases of investments
(525
)
 
(903
)
 
(914
)
 
(1,636
)
Proceeds from sales and maturities of investments
792

 
441

 
1,335

 
874

Purchases of property, equipment, and capitalized software
(10
)
 
(34
)
 
(14
)
 
(60
)
Other, net
(4
)
 
(13
)
 
(9
)
 
(24
)
Net cash provided by (used in) investing activities
253

 
(509
)
 
398

 
(846
)
Financing activities:
 
 
 
 
 
 
 
Repayment of credit facility
(300
)
 

 
(300
)
 

Repayment of 1.125% Convertible Notes
(89
)
 

 
(89
)
 

Cash paid for partial settlement of 1.125% Conversion Option
(134
)
 

 
(134
)
 

Cash received for partial termination of 1.125% Call Option
134

 

 
134

 

Cash paid for partial termination of 1.125% Warrants
(113
)
 

 
(113
)
 

Proceeds from senior notes offerings, net of issuance costs

 
325

 

 
325

Other, net
4

 
9

 
(1
)
 
8

Net cash (used in) provided by financing activities
(498
)
 
334

 
(503
)
 
333

Net (decrease) increase in cash, cash equivalents, and restricted cash and cash equivalents
(325
)
 
(222
)
 
209

 
159

Cash, cash equivalents, and restricted cash and cash equivalents at beginning of period
3,824

 
3,293

 
3,290

 
2,912

Cash, cash equivalents, and restricted cash and cash equivalents at end of period
$
3,499

 
$
3,071

 
$
3,499

 
$
3,071


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MOH Reports Second Quarter 2018 Results
Page 10
July 31, 2018

MOLINA HEALTHCARE, INC.
UNAUDITED HEALTH PLANS SEGMENT MEMBERSHIP
 
June 30,
 
December 31,
 
June 30,
 
2018
 
2017
 
2017
Ending Membership by Program:
 
 
 
 
 
Temporary Assistance for Needy Families (TANF) and Children’s Health Insurance Program (CHIP)
2,464,000

 
2,457,000

 
2,517,000

Medicaid Expansion
675,000

 
668,000

 
678,000

Aged, Blind or Disabled (ABD)
415,000

 
412,000

 
408,000

Total Medicaid
3,554,000

 
3,537,000

 
3,603,000

Medicare-Medicaid Plan (MMP) - Integrated
55,000

 
57,000

 
54,000

Medicare Special Needs Plans
45,000

 
44,000

 
44,000

Total Medicare
100,000

 
101,000

 
98,000

Total Medicaid and Medicare
3,654,000

 
3,638,000

 
3,701,000

Marketplace
409,000

 
815,000

 
949,000

 
4,063,000

 
4,453,000

 
4,650,000

 
 
 
 
 
 
Ending Membership by Health Plan:
 
 
 
 
 
California
639,000

 
746,000

 
766,000

Florida
398,000

 
625,000

 
672,000

Illinois
219,000

 
165,000

 
163,000

Michigan
397,000

 
398,000

 
414,000

New Mexico
241,000

 
253,000

 
266,000

Ohio
320,000

 
327,000

 
351,000

Puerto Rico
326,000

 
314,000

 
322,000

South Carolina
114,000

 
116,000

 
112,000

Texas
450,000

 
430,000

 
465,000

Washington
776,000

 
777,000

 
788,000

Other (1)
183,000

 
302,000

 
331,000

 
4,063,000

 
4,453,000

 
4,650,000

__________________
(1)
“Other” includes the Idaho, New York, Utah and Wisconsin health plans, which are not individually significant to our consolidated operating results.






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MOH Reports Second Quarter 2018 Results
Page 11
July 31, 2018

MOLINA HEALTHCARE, INC.
UNAUDITED SELECTED HEALTH PLANS SEGMENT FINANCIAL DATA
(In millions, except percentages and per-member per-month amounts)
 
Three Months Ended June 30, 2018
 
Member
Months (1)
 
Premium Revenue
 
Medical Care Costs
 
MCR (2)
 
Medical Margin
 
 
Total
 
PMPM
 
Total
 
PMPM
 
 
TANF and CHIP
7.5

 
$
1,393

 
$
186.18

 
$
1,205

 
$
161.13

 
86.5
%
 
$
188

Medicaid Expansion
2.1

 
761

 
372.04

 
676

 
330.83

 
88.9

 
85

ABD
1.3

 
1,288

 
1,033.34

 
1,209

 
969.27

 
93.8

 
79

Total Medicaid
10.9

 
3,442

 
319.52

 
3,090

 
286.89

 
89.8

 
352

MMP
0.1

 
367

 
2,224.30

 
313

 
1,893.91

 
85.1

 
54

Medicare
0.2

 
157

 
1,168.40

 
133

 
989.33

 
84.7

 
24

Total Medicare
0.3

 
524

 
1,751.49

 
446

 
1,488.85

 
85.0

 
78

Total Medicaid and Medicare
11.2

 
3,966

 
358.23

 
3,536

 
319.37

 
89.2

 
430

Marketplace
1.2

 
548

 
440.93

 
314

 
253.04

 
57.4

 
234

 
12.4

 
$
4,514

 
$
366.57

 
$
3,850

 
$
312.68

 
85.3
%
 
$
664


 
Three Months Ended June 30, 2017
 
Member
Months (1)
 
Premium Revenue
 
Medical Care Costs
 
MCR (2)
 
Medical Margin
 
 
Total
 
PMPM
 
Total
 
PMPM
 
 
TANF and CHIP
7.6

 
$
1,391

 
$
182.47

 
$
1,315

 
$
172.48

 
94.5
%
 
$
76

Medicaid Expansion
2.1

 
786

 
383.07

 
689

 
335.26

 
87.5

 
97

ABD
1.2

 
1,285

 
1,053.89

 
1,245

 
1,020.85

 
96.9

 
40

Total Medicaid
10.9

 
3,462

 
317.79

 
3,249

 
298.10

 
93.8

 
213

MMP
0.1

 
361

 
2,217.44

 
333

 
2,050.20

 
92.5

 
28

Medicare
0.2

 
148

 
1,126.14

 
126

 
963.34

 
85.5

 
22

Total Medicare
0.3

 
509

 
1,730.91

 
459

 
1,565.65

 
90.5

 
50

Total Medicaid and Medicare
11.2

 
3,971

 
354.87

 
3,708

 
331.36

 
93.4

 
263

Marketplace
2.8

 
769

 
267.37

 
783

 
272.37

 
101.9

 
(14
)
 
14.0

 
$
4,740

 
$
336.98

 
$
4,491

 
$
319.29

 
94.8
%
 
$
249

__________________
(1)
A member month is defined as the aggregate of each month’s ending membership for the period presented.
(2)
The MCR represents medical costs as a percentage of premium revenue.


-MORE-


MOH Reports Second Quarter 2018 Results
Page 12
July 31, 2018

MOLINA HEALTHCARE, INC.
UNAUDITED SELECTED HEALTH PLANS SEGMENT FINANCIAL DATA
(In millions, except percentages and per-member per-month amounts)
 
Six Months Ended June 30, 2018
 
Member
Months
 
Premium Revenue
 
Medical Care Costs
 
MCR
 
Medical Margin
 
 
Total
 
PMPM
 
Total
 
PMPM
 
 
TANF and CHIP
14.9

 
$
2,766

 
$
185.66

 
$
2,477

 
$
166.32

 
89.6
%
 
$
289

Medicaid Expansion
4.1

 
1,513

 
372.39

 
1,317

 
324.19

 
87.1

 
196

ABD
2.5

 
2,542

 
1,023.83

 
2,364

 
951.99

 
93.0

 
178

Total Medicaid
21.5

 
6,821

 
318.11

 
6,158

 
287.22

 
90.3

 
663

MMP
0.3

 
724

 
2,180.86

 
618

 
1,858.87

 
85.2

 
106

Medicare
0.3

 
314

 
1,178.58

 
264

 
992.05

 
84.2

 
50

Total Medicare
0.6

 
1,038

 
1,735.05

 
882

 
1,473.30

 
84.9

 
156

Total Medicaid and Medicare
22.1

 
7,859

 
356.59

 
7,040

 
319.43

 
89.6

 
819

Marketplace
2.6

 
978

 
373.67

 
532

 
203.34

 
54.4

 
446

 
24.7

 
$
8,837

 
$
358.40

 
$
7,572

 
$
307.11

 
85.7
%
 
$
1,265


 
Six Months Ended June 30, 2017
 
Member
Months
 
Premium Revenue
 
Medical Care Costs
 
MCR
 
Medical Margin
 
 
Total
 
PMPM
 
Total
 
PMPM
 
 
TANF and CHIP
15.3

 
$
2,793

 
$
182.58

 
$
2,619

 
$
171.25

 
93.8
%
 
$
174

Medicaid Expansion
4.1

 
1,603

 
390.88

 
1,378

 
335.88

 
85.9

 
225

ABD
2.4

 
2,481

 
1,030.68

 
2,375

 
986.54

 
95.7

 
106

Total Medicaid
21.8

 
6,877

 
315.39

 
6,372

 
292.22

 
92.7

 
505

MMP
0.3

 
705

 
2,152.75

 
640

 
1,954.15

 
90.8

 
65

Medicare
0.3

 
286

 
1,097.36

 
243

 
933.20

 
85.0

 
43

Total Medicare
0.6

 
991

 
1,685.72

 
883

 
1,502.36

 
89.1

 
108

Total Medicaid and Medicare
22.4

 
7,868

 
351.35

 
7,255

 
323.98

 
92.2

 
613

Marketplace
5.7

 
1,520

 
264.77

 
1,347

 
234.62

 
88.6

 
173

 
28.1

 
$
9,388

 
$
333.68

 
$
8,602

 
$
305.74

 
91.6
%
 
$
786




-MORE-


MOH Reports Second Quarter 2018 Results
Page 13
July 31, 2018

MOLINA HEALTHCARE, INC.
UNAUDITED SELECTED HEALTH PLANS SEGMENT FINANCIAL DATA—
MEDICAID AND MEDICARE
(In millions, except percentages and per-member per-month amounts)
 
Three Months Ended June 30, 2018
 
Member
Months
 
Premium Revenue
 
Medical Care Costs
 
MCR
 
Medical Margin
 
 
Total
 
PMPM
 
Total
 
PMPM
 
 
California
1.8

 
$
517

 
$
289.80

 
$
441

 
$
247.36

 
85.4
%
 
$
76

Florida
1.2

 
377

 
353.81

 
362

 
339.31

 
95.9

 
15

Illinois
0.6

 
203

 
311.60

 
170

 
261.59

 
84.0

 
33

Michigan
1.2

 
388

 
342.45

 
331

 
292.20

 
85.3

 
57

New Mexico
0.7

 
313

 
469.88

 
290

 
435.36

 
92.7

 
23

Ohio
1.0

 
535

 
571.08

 
482

 
514.57

 
90.1

 
53

Puerto Rico
0.9

 
184

 
188.26

 
165

 
168.20

 
89.3

 
19

South Carolina
0.4

 
123

 
350.22

 
107

 
304.20

 
86.9

 
16

Texas
0.7

 
576

 
835.66

 
510

 
740.55

 
88.6

 
66

Washington
2.2

 
571

 
252.61

 
526

 
232.49

 
92.0

 
45

Other (1)
0.5

 
179

 
322.99

 
152

 
274.59

 
85.0

 
27

 
11.2

 
$
3,966

 
$
358.23

 
$
3,536

 
$
319.37

 
89.2
%
 
$
430

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended June 30, 2017
 
Member
Months
 
Premium Revenue
 
Medical Care Costs
 
MCR
 
Medical Margin
 
Total
 
PMPM
 
Total
 
PMPM
 
 
California
1.9

 
$
598

 
$
318.89

 
$
539

 
$
287.36

 
90.1
%
 
$
59

Florida
1.1

 
380

 
347.20

 
370

 
337.92

 
97.3

 
10

Illinois
0.5

 
149

 
289.51

 
174

 
336.76

 
116.3

 
(25
)
Michigan
1.1

 
390

 
333.26

 
358

 
305.40

 
91.6

 
32

New Mexico
0.8

 
321

 
443.13

 
311

 
428.58

 
96.7

 
10

Ohio
1.0

 
529

 
536.90

 
489

 
496.41

 
92.5

 
40

Puerto Rico
0.9

 
179

 
184.28

 
189

 
194.42

 
105.5

 
(10
)
South Carolina
0.4

 
111

 
326.57

 
102

 
304.14

 
93.1

 
9

Texas
0.7

 
524

 
752.01

 
473

 
679.43

 
90.3

 
51

Washington
2.2

 
618

 
276.90

 
546

 
244.58

 
88.3

 
72

Other (1)
0.6

 
172

 
294.15

 
157

 
268.91

 
91.4

 
15

 
11.2

 
$
3,971

 
$
354.87

 
$
3,708

 
$
331.36

 
93.4
%
 
$
263

__________________
(1)
“Other” includes the Idaho, New York, Utah and Wisconsin health plans, which are not individually significant to our consolidated operating results.

-MORE-


MOH Reports Second Quarter 2018 Results
Page 14
July 31, 2018

MOLINA HEALTHCARE, INC.
UNAUDITED SELECTED HEALTH PLANS SEGMENT FINANCIAL DATA—
MEDICAID AND MEDICARE
(In millions, except percentages and per-member per-month amounts)
 
Six Months Ended June 30, 2018
 
Member
Months
 
Premium Revenue
 
Medical Care Costs
 
MCR
 
Medical Margin
 
 
Total
 
PMPM
 
Total
 
PMPM
 
 
California
3.6

 
$
1,011

 
$
281.14

 
$
853

 
$
237.26

 
84.4
%
 
$
158

Florida
2.2

 
759

 
352.68

 
707

 
328.26

 
93.1

 
52

Illinois
1.1

 
344

 
305.94

 
292

 
259.87

 
84.9

 
52

Michigan
2.3

 
764

 
339.56

 
662

 
294.19

 
86.6

 
102

New Mexico
1.4

 
632

 
468.00

 
600

 
444.44

 
95.0

 
32

Ohio
1.9

 
1,086

 
573.87

 
942

 
497.75

 
86.7

 
144

Puerto Rico
1.9

 
370

 
190.68

 
339

 
174.74

 
91.6

 
31

South Carolina
0.7

 
245

 
349.15

 
211

 
300.87

 
86.2

 
34

Texas
1.4

 
1,138

 
822.72

 
1,029

 
744.05

 
90.4

 
109

Washington
4.5

 
1,155

 
254.64

 
1,100

 
242.48

 
95.2

 
55

Other
1.1

 
355

 
318.94

 
305

 
273.97

 
85.9

 
50

 
22.1

 
$
7,859

 
$
356.59

 
$
7,040

 
$
319.43

 
89.6
%
 
$
819

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Six Months Ended June 30, 2017
 
Member
Months
 
Premium Revenue
 
Medical Care Costs
 
MCR
 
Medical Margin
 
Total
 
PMPM
 
Total
 
PMPM
 
 
California
3.7

 
$
1,170

 
$
313.76

 
$
1,023

 
$
274.42

 
87.5
%
 
$
147

Florida
2.2

 
744

 
343.29

 
722

 
333.23

 
97.1

 
22

Illinois
1.1

 
310

 
282.66

 
354

 
322.63

 
114.1

 
(44
)
Michigan
2.3

 
772

 
330.34

 
690

 
295.02

 
89.3

 
82

New Mexico
1.5

 
629

 
432.98

 
610

 
419.65

 
96.9

 
19

Ohio
2.0

 
1,049

 
532.35

 
951

 
482.73

 
90.7

 
98

Puerto Rico
1.9

 
362

 
185.40

 
354

 
181.24

 
97.8

 
8

South Carolina
0.7

 
216

 
321.85

 
200

 
298.79

 
92.8

 
16

Texas
1.4

 
1,051

 
751.94

 
962

 
687.96

 
91.5

 
89

Washington
4.4

 
1,223

 
275.05

 
1,081

 
243.18

 
88.4

 
142

Other
1.2

 
342

 
291.93

 
308

 
262.97

 
90.1

 
34

 
22.4

 
$
7,868

 
$
351.35

 
$
7,255

 
$
323.98

 
92.2
%
 
$
613



-MORE-


MOH Reports Second Quarter 2018 Results
Page 15
July 31, 2018


MOLINA HEALTHCARE, INC.
UNAUDITED SELECTED HEALTH PLANS SEGMENT FINANCIAL DATA—MARKETPLACE
(In millions, except percentages and per-member per-month amounts)
 
Three Months Ended June 30, 2018
 
Member
Months
 
Premium Revenue
 
Medical Care Costs
 
MCR
 
Medical Margin
 
 
Total
 
PMPM
 
Total
 
PMPM
 
 
California
0.2

 
$
73

 
$
426.16

 
$
21

 
$
117.92

 
27.7
%
 
$
52

Florida
0.1

 
100

 
698.31

 
38

 
269.86

 
38.6

 
62

Michigan

 
15

 
288.67

 
7

 
146.97

 
50.9

 
8

New Mexico

 
31

 
418.82

 
18

 
247.06

 
59.0

 
13

Ohio

 
31

 
518.64

 
23

 
381.46

 
73.6

 
8

Texas
0.7

 
222

 
330.12

 
160

 
238.72

 
72.3

 
62

Washington
0.2

 
56

 
787.80

 
41

 
572.48

 
72.7

 
15

Other (1)

 
20

 
NM

 
6

 
NM

 
NM
 
14

 
1.2

 
$
548

 
$
440.93

 
$
314

 
$
253.04

 
57.4
%
 
$
234

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended June 30, 2017
 
Member
Months
 
Premium Revenue
 
Medical Care Costs
 
MCR
 
Medical Margin
 
Total
 
PMPM
 
Total
 
PMPM
 
 
California
0.5

 
$
81

 
$
186.90

 
$
67

 
$
154.23

 
82.5
%
 
$
14

Florida
0.9

 
269

 
284.60

 
317

 
336.78

 
118.3

 
(48
)
Michigan
0.1

 
16

 
204.15

 
10

 
135.89

 
66.6

 
6

New Mexico

 
31

 
367.98

 
23

 
266.91

 
72.5

 
8

Ohio

 
24

 
377.94

 
27

 
404.20

 
106.9

 
(3
)
Texas
0.7

 
177

 
247.49

 
129

 
180.92

 
73.1

 
48

Washington
0.2

 
44

 
317.42

 
49

 
359.87

 
113.4

 
(5
)
Other (1)
0.4

 
127

 
304.00

 
161

 
383.02

 
126.0

 
(34
)
 
2.8

 
$
769

 
$
267.37

 
$
783

 
$
272.37

 
101.9
%
 
$
(14
)
__________________
(1)
“Other” includes the Utah and Wisconsin health plans, which are not individually significant to our consolidated operating results. We terminated Marketplace operations at these plans effective January 1, 2018, so the ratios for 2018 periods are not meaningful (NM).

-MORE-


MOH Reports Second Quarter 2018 Results
Page 16
July 31, 2018

MOLINA HEALTHCARE, INC.
UNAUDITED SELECTED HEALTH PLANS SEGMENT FINANCIAL DATA—MARKETPLACE
(In millions, except percentages and per-member per-month amounts)
 
Six Months Ended June 30, 2018
 
Member
Months
 
Premium Revenue
 
Medical Care Costs
 
MCR
 
Medical Margin
 
 
Total
 
PMPM
 
Total
 
PMPM
 
 
California
0.4

 
$
122

 
$
334.47

 
$
52

 
$
141.73

 
42.4
%
 
$
70

Florida
0.3

 
145

 
468.36

 
22

 
73.13

 
15.6<