The table below provides selected financial data and other operating information as of and for the five years ended December 31, 2013. We derived the selected financial data presented below for the three years ended December 31, 2013 from our audited financial statements. In connection with our 2011 Medicare Part D sale, the Medicare Part D business was reclassified to discontinued operations in our consolidated financial statements as well as for all periods in the selected financial data stated below-see Note 23-Discontinued Operations in the Notes to consolidated financial statements. We have prepared the following data, other than statutory data, in conformity with U.S. generally accepted accounting principles. You should read this selected financial data together with our consolidated financial statements and the Notes to consolidated financial statements as well as the discussion under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations."
As of December 31, 2013, we have partnered with primary-care provider groups and a variety of other health care providers to form thirty-four ACOs which have been approved by CMS for participation in the Shared Savings Program. Based on data provided by CMS at December 31, 2013, these thirty-four ACOs included approximately 3,200 participating providers with approximately 358,000 assigned Medicare fee-for-service beneficiaries covering portions of thirteen states both within and outside our current Medicare Advantage footprint, including Southeast Texas and upstate New York. CHS provides these ACOs with care coordination, analytics and reporting, technology and other administrative capabilities to enable participating providers to deliver better care, improved health and lower healthcare costs for their Medicare fee-for-service beneficiaries. During 2014, we may reduce the number of our ACOs based on a variety of factors, including the level of commitment by the physicians in the ACO and the likelihood of the ACO achieving shared savings.
Policyholder benefits. Policyholder benefits incurred declined by $12.7 million, or 6.4%, compared to 2011. This decline was principally due to the overall decline of insurance in-force in the Senior Market and Specialty Health lines of business and a lower medical trend on Medicare supplement, partially offset by an increase in the severity of long term care claims during 2012. For 2012, the policyholder benefit ratio for senior market health was 68.7% compared with 72.3% in 2011, and for specialty health was 116.0% in 2012, compared with 99.9% in 2011.
(3)Our obligations for policy related liabilities represent those payments we expect to make on death, disability and health insurance claims and policy surrenders, net of amounts recovered from reinsurers. These projected values contain assumptions for future policy persistency, mortality and morbidity comparable with our historical experience. The distribution of payments for policy and contract claims reflects assumptions as to the timing of policyholders reporting claims for prior periods and the amounts of those claims. Actual amounts and timing of both future policy benefits and policy and contract claims may differ significantly from the estimates above. We anticipate that our reserves for policy liabilities and policy and contract claims, along with future net premiums, investment income and recoveries from our reinsurers will be sufficient to fund our policy related obligations. On our consolidated balance sheets in Part II, Item 8 of this annual report on Form 10-K, we report our policy related liabilities gross of amounts recoverable from reinsurers, which are reported as assets. We are obligated to pay claims in the event that a reinsurer fails to
•Due to the general increase in interest rates during the second quarter, the discount rate used in the impairment analysis was increased by 50 basis points compared to the rate used in the prior impairment testing analysis.
The significant acquired tax attributes that create deferred tax assets include net operating loss and foreign tax credit carryforwards. To use the foreign tax credit carryforwards two conditions must be met. There must be foreign source income and there must be taxable income after application of any loss carryforwards. Based upon reversing timing items and projected income we expect taxable income to be sufficient to utilize the entire operating loss carryforward. However, we do not expect to have sufficient foreign source income to fully utilize the acquired foreign tax credit carryforwards. Consequently, we established a valuation allowance of $0.9 million against the foreign tax credit carryforwards for the year ended December 31, 2013.
Rico. We will include any income or loss from a subsidiary taxed as a partnership in the tax return of its corporate owner.