Spreadsheet: b30d4e46-12bd-4609-858d-1e39fa2429fb
Sheet: MD&A

Universal American Corp
MD&A Summary
2011-12-31 00:00:00
Consolidated Results |  |  |  | Q4 - QTD |  |  | Q4 - QTD |  | QTD |  |  |  | Q4 - YTD |  |  | Q4 - YTD |  | QTD |  |  |  | Q3 - QTD |  |  | Q4 - QTD |  | QTD
For the quarter ended December 31, 2011 |  |  |  | 2010 |  |  | 2011 |  | [NAME] |  |  |  | 2010 |  |  | 2011 |  | [NAME] |  |  |  | 2011 |  |  | 2011 |  | [NAME]
In thousands
Continuing Operations:
 | Total Senior Managed Care - Medicare Advantage |  |  | 12963.12854000034 |  |  | 19803.55622000009 |  |  |  |  |  | 149071.1310700001 |  |  | 67963.62796461559 |  |  |  |  |  | 21407.20416999977 |  |  | 19803.55622000009
 | Total Traditional Insurance |  |  | -501.5979000000098 |  |  | 4588.307398523268 |  |  |  |  |  | 1167.522840000016 |  |  | 13167.92206852324 |  |  |  |  |  | 6680.797299999975 |  |  | 4588.307398523268
 | Total Corporate & Other |  |  | -22365.59523087334 |  |  | -45803.48698669308 |  |  |  |  |  | -37600.00277559282 |  |  | -77892.58999258012 |  |  |  |  |  | -8081.057929999999 |  |  | -45803.48698669308
 | Realized gains (losses) |  |  | -330.3708600000021 |  |  | -1562.875770000001 |  |  |  |  |  | 6574.837319999998 |  |  | 841.4575700000005 |  |  |  |  |  | 408.6445699999986 |  |  | -1562.875770000001
 | Income from continuing operations before income taxes
 | Provision for income taxes |  |  | -306.5557652929158 |  |  | -4378.505162043444 |  |  |  |  |  | 38182.14708392662 |  |  | 3820.484555334694 |  |  |  |  |  | 6311.552361397464 |  |  | -4378.505162043444
Income from continuing operations
Discontinued Operations:
 | Total Medicare Part D |  |  | 180725.4013300001 |  |  | 0 |  |  |  |  |  | 184776.1944799999 |  |  | -43224.42923999998 |  |  |  |  |  | 1.40630618261639e-10 |  |  | 0
 | Corporate |  |  | -9903.938249126664 |  |  | -225 |  |  |  |  |  | -28096.03125440718 |  |  | -24093.96149411295 |  |  |  |  |  | 0 |  |  | -225
 | Realized gains (losses) |  |  | 29.7360000000001 |  |  | 0 |  |  |  |  |  | -1580.264 |  |  | -11925.493 |  |  |  |  |  | 0 |  |  | 0
 | Income from discontinued operations before income taxes
 | Provision for income taxes |  |  | 56396.79437378031 |  |  | 1178.519 |  |  |  |  |  | 48452.08605088018 |  |  | -35968.51378043953 |  |  |  |  |  | 0 |  |  | 1178.519
Income from discontinued operations
 | Net income
Per Share Data (Diluted)
 | Income from continuing operations |  |  | -0.1254938939662273 |  |  | -0.2310328648491154 |  |  |  |  |  | 1.036055767628635 |  |  | 0.003225823865059801 |  |  |  |  |  | 0.1746582537443455 |  |  | -0.2310328648491154
 | Income for discontinued operations |  |  | 1.446767022080441 |  |  | -0.01743703594744398 |  |  |  |  |  | 1.363584510337306 |  |  | -0.5370564395726466 |  |  |  |  |  | 1.741508504826336e-15 |  |  | -0.01743703594744398
 | Net Income
 | Weighted Average shares O/S - Diluted |  |  | 79110460.05355343 |  |  | 80490686.8478261 |  |  |  |  |  | 78211370.3743462 |  |  | 80578812.14143719 |  |  |  |  |  | 80752185.7469555 |  |  | 80490686.8478261
Consolidated Segments- Check totals only
For the quarter ended December 31, 2011 |  |  |  | Q4 |  |  | Q4 |  | QTD |  |  |  | Total |  |  | Total |  | QTD |  |  |  | Q3 |  |  | Q4 |  | QTD
In thousands |  |  |  | 2010 |  |  | 2011 |  | [NAME] |  |  |  | 2010 |  |  | 2011 |  | [NAME] |  |  |  | 2011 |  |  | 2011 |  | [NAME]
Continuing Operations:
Gross premiums and policyholder fees; |  |  |  | 904860.0384900004 |  |  | 545653.1793600001 |  |  |  |  |  | 3621280.80373 |  |  | 2350073.19795 |  |  |  |  |  | 593962.7757999998 |  |  | 545653.1793600001
Ceded premiums and policyholder fees: |  |  |  | -41476.90987 |  |  | -30726.9527381699 |  |  |  |  |  | -175622.87179 |  |  | -130552.7794781699 |  |  |  |  |  | -28535.19534 |  |  | -30726.9527381699
 | Net premiums
Net investment income |  |  |  | 9807.017530000001 |  |  | 11007.58517 |  |  |  |  |  | 39759.97086 |  |  | 47424.37725000001 |  |  |  |  |  | 11498.09655 |  |  | 11007.58517
Other income |  |  |  | 2506.213690000001 |  |  | 4706.582229999999 |  |  |  |  |  | 9805.19917 |  |  | 14939.39407 |  |  |  |  |  | 4576.067010000002 |  |  | 4706.582229999999
 | Total revenue
Policyholder benefits |  |  | 0.8402541401979332 | 725461.2484 |  | 0.7917027366512409 | 407668.50279 |  |  |  |  | 0.8302217944772509 | 2860660.31141 |  | 0.8167633815904037 | 1812823.0025 |  |  |  |  | 0.8069453794220746 | 456269.1734500002 |  | 0.7917027366512409 | 407668.50279
Change in deferred acquisition costs |  |  |  | 2120.889 |  |  | 1003.533979999998 |  |  |  |  |  | 5647.868449999999 |  |  | 3237.163139999999 |  |  |  |  |  | 87.36814000000163 |  |  | 1003.533979999998
Amortization of present value of future profits and goodwill |  |  | 0.1834368167629313 | 1762.92327 |  | 0.20513647501116 | 1089.148113306901 |  |  |  |  | 0.1494349122768809 | 7022.54863 |  | 0.1909175138442862 | 4411.691563306902 |  |  |  |  | 0.1844357498712029 | 940.5672300000003 |  | 0.20513647501116 | 1089.148113306901
Impairment of intangible assets |  |  |  | 0 |  |  | 15622.0464666931 |  |  |  |  |  | 0 |  |  | 15622.0464666931 |  |  |  |  |  | 0 |  |  | 15622.0464666931
Restructure Costs |  |  |  | 0 |  |  | 22042.169 |  |  |  |  |  | 0 |  |  | 22042.169 |  |  |  |  |  | 0 |  |  | 22042.169
Commissions and general expenses, net of allowances |  |  | 0.1809803302626797 | 156255.3637608734 |  | 0.2031875861643369 | 104626.61704 |  |  |  |  | 0.1477957860021436 | 509253.7223455929 |  | 0.189459017173988 | 420508.1570812715 |  |  |  |  | 0.1842812329303616 | 104197.69166 |  | 0.2031875861643369 | 104626.61704
 | Total benefits and expenses
 | Segment income
 | Realized gains (losses) |  |  | -330.3708600000021 |  |  | -1562.875770000001 |  |  |  |  |  | 6574.837319999998 |  |  | 841.4575700000005 |  |  |  |  |  | 408.6445699999986 |  |  | -1562.875770000001
 | Pre-tax income from Continuing Operations
Discontinued Operations: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 0 |  |  | 0
Income from discontinued operations, pre-tax |  |  |  | 170851.1990808735 |  |  | -225 |  |  |  |  |  | 155099.8992255926 |  |  | -63052.67022411298 |  |  |  |  |  | 1.40630618261639e-10 |  |  | -225
Expenses of transactions, pre-tax |  |  |  | 0 |  |  | 0 |  |  |  |  |  | 0 |  |  | -16190.77779 |  |  |  |  |  | 0 |  |  | 0
Pre-tax income from discontinued operations |  |  |  | 170851.1990808735 |  |  | -225 |  |  |  |  |  | 155099.8992255926 |  |  | -79243.44801411299 |  |  |  |  |  | 1.40630618261639e-10 |  |  | -225
 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 0 |  |  | 0
 | Pre-tax Income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 20415.58810999991 |  |  | -23199.49913816988
Senior Managed Care - Medicare Advantage - Total Segment
For the quarter ended December 31, 2011 |  |  |  | Q4 |  |  | Q4 |  | QTD |  |  |  | Total |  |  | Total |  | QTD |  |  |  | Q3 |  |  | Q4 |  | QTD
In thousands |  |  |  | 2010 |  |  | 2011 |  | [NAME] |  |  |  | 2010 |  |  | 2011 |  | [NAME] |  |  |  | 2011 |  |  | 2011 |  | [NAME]
Gross premiums and policyholder fees; |  |  |  | 803157.4440900004 |  |  | 453956.1252900001 |  |  |  |  |  | 3193558.66087 |  |  | 1965070.94853 |  |  |  |  |  | 502156.9618299999 |  |  | 453956.1252900001
Ceded premiums and policyholder fees: |  |  |  | -8957.617209999999 |  |  | -1677.46803 |  |  |  |  |  | -37752.96483 |  |  | -4870.38393 |  |  |  |  |  | -1033.24108 |  |  | -1677.46803
 | Net premiums
Net investment income |  |  |  | 5778.983769999999 |  |  | 6066.635649999998 |  |  |  |  |  | 24517.30051 |  |  | 26322.50619 |  |  |  |  |  | 6143.01562 |  |  | 6066.635649999998
Other income |  |  |  | 509.39292 |  |  | 394.6070300000001 |  |  |  |  |  | 2112.39244 |  |  | 1845.42116 |  |  |  |  |  | 294.0401299999999 |  |  | 394.6070300000001
 | Total revenue
Policyholder benefits |  |  | 0.8443852540795455 | 670610.6226100001 |  | 0.7958183109513549 | 359931.6371000001 |  |  |  |  | 0.8361054584098689 | 2638586.36814 |  | 0.8228853835674483 | 1613020.39347 |  |  |  |  | 0.8157825828882402 | 408808.0032600001 |  | 0.7958183109513549 | 359931.6371000001
Amortization of present value of future profits and goodwill |  |  |  | 1037.30634 |  |  | 998.4606000000003 |  |  |  |  |  | 4293.57519 |  |  | 3993.91516 |  |  |  |  |  | 918.4606000000003 |  |  | 998.4606000000003
 | Comms |  | 0.02371221837030736 | 19044.64470000001 |  | 0.0172058217410555 | 7810.68817 |  |  |  |  | 0.02490434587737719 | 79533.48947 |  | 0.01688596416064385 | 33182.11761 |  |  |  |  | 0.01310025036001999 | 6578.38192 |  | 0.0172058217410555 | 7810.68817
 | Allows |  | 0.0633683307393753 | -567.6292500000001 |  | -0.2176598382026986 | 365.1174199999996 |  |  |  |  | 0.06463671716879037 | -2440.22771 |  | -0.4356082170302332 | 2121.57926 |  |  |  |  | -1.678995147966823 | 1734.80676 |  | -0.2176598382026986 | 365.1174199999996
 | Expenses |  | 0.1212715281999995 | 97400.13063000003 |  | 0.1538264086323108 | 69830.44043000002 |  |  |  |  | 0.09813223620092358 | 313391.0528300001 |  | 0.1364255365364442 | 268085.8584853845 |  |  |  |  | 0.1356426873815985 | 68113.91978999999 |  | 0.1538264086323108 | 69830.44043000002
Commissions and general expenses, net of allowances |  |  | 0.1459042701321421 |  |  | 0.1724738604571314 |  |  |  |  |  | 0.1237352207963854 |  |  | 0.1547747515404345 |  |  |  |  |  | 0.1525114563637427 |  |  | 0.1724738604571314
 | Total benefits and expenses
 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 0 |  |  | 0
 | Segment income
Traditional Insurance - Total Segment
For the quarter ended December 31, 2011 |  |  |  | Q4 |  |  | Q4 |  | QTD |  |  |  | Total |  |  | Total |  | QTD |  |  |  | Q3 |  |  | Q4 |  | QTD
In thousands |  |  |  | 2010 |  |  | 2011 |  | [NAME] |  |  |  | 2010 |  |  | 2011 |  | [NAME] |  |  |  | 2011 |  |  | 2011 |  | [NAME]
Gross premiums and policyholder fees |  |  |  | 101702.5944 |  |  | 91697.05407 |  |  |  |  |  | 427722.14286 |  |  | 376653.86804 |  |  |  |  |  | 91805.81396999999 |  |  | 91697.05407
Ceded premiums and policyholder fees |  |  |  | -32519.29266000001 |  |  | -29049.4847081699 |  |  |  |  |  | -137869.90696 |  |  | -117334.4389681699 |  |  |  |  |  | -27501.95426 |  |  | -29049.4847081699
 | Net premiums
Net investment income |  |  |  | 3938.353470000001 |  |  | 4947.46869 |  |  |  |  |  | 14891.38006 |  |  | 21029.82608 |  |  |  |  |  | 5349.38842 |  |  | 4947.46869
Other income |  |  |  | 1392.486569999999 |  |  | 281.2774699999999 |  |  |  |  |  | 2706.927909999999 |  |  | 734.62778 |  |  |  |  |  | 222.68202 |  |  | 281.2774699999999
 | Total revenue
Policyholder benefits |  |  | 0.7928304144276882 | 54850.62579 |  | 0.7619907073216002 | 47736.86568999993 |  |  |  |  | 0.7661626020598172 | 222073.94327 |  | 0.770488388568277 | 199802.6090299999 |  |  |  |  | 0.7380765385474871 | 47461.17019000001 |  | 0.7619907073216002 | 47736.86568999993
Change in deferred acquisition costs |  |  |  | 2120.889 |  |  | 1003.533979999998 |  |  |  |  |  | 5647.868449999999 |  |  | 3237.163139999999 |  |  |  |  |  | 87.36814000000163 |  |  | 1003.533979999998
Amortization of present value of future profits and goodwill |  |  |  | 725.6169299999999 |  |  | 90.68751330690104 |  |  |  |  |  | 2728.97344 |  |  | 417.776403306901 |  |  |  |  |  | 22.10662999999995 |  |  | 90.68751330690104
 | Comms |  | 0.1052965165065641 | 10708.92891 |  | 0.06085642005183774 | 5580.354439999997 |  |  |  |  | 0.1070626497936273 | 45793.06599 |  | 0.07262580385101731 | 27354.78994 |  |  |  |  | 0.06064442140689845 | 5567.510470000004 |  | 0.06085642005183774 | 5580.354439999997
 | Allows |  | 0.1424631746587319 | -4632.801669999998 |  | -0.04277771645465744 | 1242.670619999999 |  |  |  |  | 0.1445439182444778 | -19928.25656 |  | -0.01028862719774445 | 1207.210299999999 |  |  |  |  | -0.1210669928588558 | 3329.5789 |  | 0.01983589519367903 | 1242.670619999999
 | Expenses |  | 0.1105427131561946 | 11242.48072 |  | 0.08325126643842246 | 7633.89588 |  |  |  |  | 0.1168221642814389 | 49967.42644 |  | 0.0953045750911758 | 35896.83685 |  |  |  |  | 0.07327856732688363 | 6727.398519999998 |  |  | 7633.89588
Commissions and general expenses, net of allowances |  |  | 0.2503293067030196 |  |  | 0.2307658714818122 |  |  |  |  |  | 0.2616237740396882 |  |  | 0.2485692542233126 |  |  |  |  |  | 0.2429790056221184
 | Total benefits and expenses
 | Segment income
 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 0 |  |  | 0
Corporate & Other
For the quarter ended December 31, 2011 |  |  |  | Q4 |  |  | Q4 |  | QTD |  |  |  | Total |  |  | Total |  | QTD |  |  |  | Q3 |  |  | Q4 |  | QTD
In thousands |  |  |  | 2010 |  |  | 2011 |  | [NAME] |  |  |  | 2010 |  |  | 2011 |  | [NAME] |  |  |  | 2011 |  |  | 2011 |  | [NAME]
Interest expense |  |  |  | 0 |  |  | 849.9999799999999 |  |  |  |  |  | 0 |  |  | 2285.234555555556 |  |  |  |  |  | 850.00027 |  |  | 849.9999799999999
Amortization of capitalized loan origination fees |  |  |  | 0 |  |  | 45.9375 |  |  |  |  |  | 0 |  |  | 122.5 |  |  |  |  |  | 45.9375 |  |  | 45.9375
Stock-based compensation expense |  |  |  | 2947.601948819223 |  |  | 1918.531167061564 |  |  |  |  |  | 9995.223041245627 |  |  | 17013.38988153784 |  |  |  |  |  | 2124.127676435179 |  |  | 1918.531167061564
Additional allowance on agent receivables (2009)/Early extinguishment of debt |  |  |  | 15000 |  |  | 0 |  |  |  |  |  | 15000 |  |  | 0 |  |  |  |  |  | 0 |  |  | 0
Other parent company expense, net of revenue |  |  |  | 4241.843832054117 |  |  | 43070.91089963152 |  |  |  |  |  | 13318.5956243472 |  |  | 58292.85886548673 |  |  |  |  |  | 5140.48167356482 |  |  | 43070.91089963152
Net (gain)/loss - Senior Administrative Services |  |  |  | 176.1494499999974 |  |  | -81.89255999999921 |  |  |  |  |  | -713.6148900000019 |  |  | 178.6146000000007 |  |  |  |  |  | -79.48919000000029 |  |  | -81.89255999999921
 | Segment loss
Corporate & Other - Consolidated
For the quarter ended December 31, 2011
Net investment income |  |  |  | 89.68028999999996 |  |  | -6.519170000000021 |  |  |  |  |  | 351.29029 |  |  | 72.04497999999998 |  |  |  |  |  | 5.692510000000017 |  |  | -6.519170000000021
Other income |  |  |  | 604.334200000002 |  |  | 4030.697729999999 |  |  |  |  |  | 4985.878820000001 |  |  | 12359.34513 |  |  |  |  |  | 4059.344860000002 |  |  | 4030.697729999999
 | Total revenue
Debt Service |  |  |  | 0 |  |  | 895.9374799999999 |  |  |  |  |  | 0 |  |  | 2407.734555555556 |  |  |  |  |  | 895.93777 |  |  | 895.9374799999999
Impairment of intangible assets |  |  |  | 0 |  |  | 15622.0464666931 |  |  |  |  |  | 0 |  |  | 15622.0464666931 |  |  |  |  |  | 0 |  |  | 15622.0464666931
Restructure costs |  |  |  | 0 |  |  | 22042.169 |  |  |  |  |  | 0 |  |  | 22042.169 |  |  |  |  |  | 0 |  |  | 22042.169
Stock-based compensation expense |  |  |  | 2947.601948819223 |  |  | 1918.531167061564 |  |  |  |  |  | 9995.223041245627 |  |  | 17013.38988153784 |  |  |  |  |  | 2124.127676435179 |  |  | 1918.531167061564
Other parent company expense |  |  |  | 20112.00777205412 |  |  | 9348.981432938415 |  |  |  |  |  | 32941.9488443472 |  |  | 33238.64019879363 |  |  |  |  |  | 9126.02985356482 |  |  | 9348.981432938415
 | Total benefits and expenses
 | Segment income (loss) |  |  |  |  |  |  |  |  | 1.04794401910065 |  |  |  |  |  |  |  |  | 1.04794401910065 |  |  |  |  |  |  |  |  | 1.04794401910065