Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2014

Summary of Significant Accounting Policies [Abstract]

Accumulated Other Comprehensive (Loss) Income

Our accumulated other comprehensive income (loss) for the three and six months ended June 30, 2014 and 2013 are as follows:

	Unrealized Gains (Losses) on investments available-for-sale			Defined Benefit Pension Plans			Accumulated Other Comprehensive Income (loss)
Three Months Ended June 30:				(Dollars in millions)
Balance as of April 1, 2013	$	20.9		$	(10.6	)	$	10.3
Other comprehensive loss before reclassifications	(42.6		)	—			(42.6		)
Amounts reclassified from accumulated other comprehensive (loss) income	(3.7		)	0.4			(3.3		)
Other comprehensive (loss) income for the three months ended June 30, 2013	(46.3		)	0.4			(45.9		)
Balance as of June 30, 2013	$	(25.4	)	$	(10.2	)	$	(35.6	)
Balance as of April 1, 2014	$	(10.0	)	$	(4.5	)	$	(14.5	)
Other comprehensive income (loss) before reclassifications	15.2			—			15.2
Amounts reclassified from accumulated other comprehensive (loss) income	(1.3		)	0.1			(1.2		)
Other comprehensive income for the three months ended June 30, 2014	13.9			0.1			14.0
Balance as of June 30, 2014	$	3.9		$	(4.4	)	$	(0.5	)
Six Months Ended June 30:
Balance as of January 1, 2013	$	38.0		$	(11.0	)	$	27.0
Other comprehensive (loss) income before reclassifications	(48.5		)	—			(48.5		)
Amounts reclassified from accumulated other comprehensive income	(14.9		)	0.8			(14.1		)
Other comprehensive (loss) income for the six months ended June 30, 2013	(63.4		)	0.8			(62.6		)
Balance as of June 30, 2013	$	(25.4	)	$	(10.2	)	$	(35.6	)
Balance as of January 1, 2014	$	(28.3	)	$	(4.6	)	$	(32.9	)
Other comprehensive income (loss) before reclassifications	33.7			—			33.7
Amounts reclassified from accumulated other comprehensive income	(1.5		)	0.2			(1.3		)
Other comprehensive income for the six months ended June 30, 2014	32.2			0.2			32.4
Balance as of June 30, 2014	$	3.9		$	(4.4	)	$	(0.5	)

Reclassifications Out of Accumulated Other Comprehensive Income

The following table shows reclassifications out of accumulated other comprehensive income and the affected line items in the consolidated statements of operations for the three and six months ended June 30, 2014 and 2013:

	Three months ended June 30,						Six months ended June 30,						Affected line item in the Consolidated Statements of Operations
	2014			2013			2014			2013
	(Dollars in millions)
Unrealized gains on investments available-for-sale	$	1.9		$	5.7		$	2.2		$	23.0		Net investment income
	1.9			5.7			2.2			23.0			Total before tax
	0.6			2.0			0.7			8.1			Tax expense
	1.3			3.7			1.5			14.9			Net of tax
Amortization of defined benefit pension items:
Prior-service cost	(0.1		)	—			(0.2		)	—			(a)
Actuarial gains (losses)	—			(0.7		)	(0.1		)	(1.3		)	(a)
	(0.1		)	(0.7		)	(0.3		)	(1.3		)	Total before tax
	—			(0.3		)	(0.1		)	(0.5		)	Tax benefit
	(0.1		)	(0.4		)	(0.2		)	(0.8		)	Net of tax
Total reclassifications for the period	$	1.2		$	3.3		$	1.3		$	14.1		Net of tax

_________

(a) These accumulated other comprehensive income components are included in the computation of net periodic pension cost.

Carrying Amount of Goodwill

The carrying amount of goodwill by reporting unit is as follows:

	Western Region Operations		Total
	(Dollars in millions)
Balance as of December 31, 2013	$	565.9	$	565.9
Balance as of June 30, 2014	$	565.9	$	565.9

Schedule of Intangible Assets

The intangible assets that continue to be subject to amortization using the straight-line method over their estimated lives are as follows:

	Gross Carrying Amount		Accumulated Amortization			Net Balance		Weighted Average Life (in years)
	(Dollars in millions)
As of June 30, 2014:
Provider networks	$	41.5	$	(36.3	)	$	5.2	18.9
Customer relationships and other	29.5		(21.5		)	8.0		11.1
	$	71.0	$	(57.8	)	$	13.2
As of December 31, 2013:
Provider networks	$	40.5	$	(35.7	)	$	4.8	19.4
Customer relationships and other	29.5		(20.5		)	9.0		11.1
	$	70.0	$	(56.2	)	$	13.8

Estimated Annual Pretax Amortization Expense For Other Intangible Assets

Estimated annual pretax amortization expense for other intangible assets for each of the next five years ending December 31 is as follows (dollars in millions):

Year	Amount
2014	$	3.0
2015	2.8
2016	2.2
2017	2.2
2018	2.1

Schedule of Financial Statement Impact of Section 1202 Model Change

The financial statement impact of the section 1202 reimbursement methodology change is summarized in the table below. We have not recorded any premium revenue or health care costs for 2014 incurred services as we do not have sufficient information to make a reasonable estimate as of June 30, 2014.

	Recorded In
	Year Ended December 31, 2013		Three Months Ended March 31, 2014		Three Months Ended June 30, 2014
(Dollars in millions)	No Risk		No Risk		Full Risk
Health plan services premiums	$	4.4	$	—	$	154.7
Health plan services expenses	—		—		144.0
General and administrative expenses	4.4		—		—
Administrative services fees and other income	6.5		1.4		(7.9		)
Pretax income	$	6.5	$	1.4	$	2.8