The table below provides a reconciliation of changes in reserve for claims for the years ended December 31, 2012, 2011 and 2010.



	Health Plan Services Year Ended December 31,
	2012		2011			2010
	(Dollars in millions)
Reserve for claims (a), beginning of period	$	720.8	$	727.5		$	692.2
Incurred claims related to:
Current year	4,950.9		4,733.0			4,644.2
Prior years (c)	34.5		(96.5		)	(70.0		)
Total incurred (b)	4,985.4		4,636.5			4,574.2
Paid claims related to:
Current year	4,156.6		4,024.4			3,929.3
Prior years	740.9		618.8			609.6
Total paid (b)	4,897.5		4,643.2			4,538.9
Reserve for claims (a), end of period	808.7		720.8			727.5
Add:
Claims and claims-related payable (d)	91.6		111.0			123.6
Other (e)	137.7		80.3			90.9
Reserves for claims and other settlements, end of period	$	1,038.0	$	912.1		$	942.0

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(a)	Consists of IBNR claims and received but unprocessed claims and reserves for loss adjustment expenses.


(b)	Includes medical claims only. Capitation, pharmacy and other payments (including, for example, provider settlements) are not included.

(c)

This line represents the change in reserves attributable to the difference between the original estimate of incurred claims for prior years and the revised estimate. In developing the revised estimate, there were no changes in the approach used to determine the key actuarial assumptions, which are the completion factor and medical cost trend. Claims liabilities were estimated under GAAP and actuarial standards of practice. The majority of the reserve balance held at each quarter-end is associated with the most recent months’ incurred services because these were the services for which the fewest claims have been paid. The degree of uncertainty in the estimates of incurred claims was greater for the most recent months’ incurred services. Revised estimates for prior years were determined in each quarter based on the most recent updates of paid claims for prior years. As of December 31, 2012, 2011 and 2010, incurred claims related to prior years were estimated to be $34.5 million higher, $96.5 million lower and $70.0 million lower, respectively, than originally estimated. The majority of these amounts were due to adjustments to our reserves that related to variables and uncertainties associated with our assumptions. As our reserve balance for older months of service decreased, and estimates of our incurred costs for older dates of service became more certain and predictable, our estimates of incurred claims related to prior periods were adjusted accordingly. The change in prior years incurred claims was favorable in 2011 and unfavorable in 2012. We believe this unfavorable reserve development in 2012 was primarily due to significant delays in claims submissions for the fourth quarter of 2011 arising from issues related to a new billing format required by HIPAA coupled with an unanticipated flattening of commercial trends and higher commercial large group claims trend. See Note 2 under the heading "Health Plan Services Health Care Cost" for more information.


(d)	Includes claims payable, provider dispute reserve, and other claims-related liabilities.


(e)	Includes accrued capitation, shared risk settlements, and other reserve items.