What changed in this filing

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Item 1. Financial Statements

2021-11-03 compared with 2021-08-03 · 47 added, 45 removed, 442 unchanged (17% of the section changed)

2 unchanged sentences

Condensed Consolidated Balance Sheets

(in millions, except per share data) June 30,

(in millions, except per share data) September 30,

2021 December 31,

40 unchanged sentences

Condensed Consolidated Statements of Operations

Three Months Ended

June 30, Six Months Ended

Three Months Ended September 30, Nine Months Ended September 30,

(in millions, except per share data) 2021 2020 2021 2020

27 unchanged sentences

Condensed Consolidated Statements of Comprehensive Income

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(in millions) 2021 2020 2021 2020

Net earnings $ 4,191 $ 3,256 $ 13,541 $ 13,417

Other comprehensive income (loss):

Gross unrealized gains (losses) on investment securities during the period 251 1,120 ( 513 ) 771

Other comprehensive (loss) income:

Gross unrealized (losses) gains on investment securities during the period ( 192 ) 148 ( 705 ) 919

Income tax effect 59 ( 37 ) 175 ( 214 )

Total unrealized gains (losses), net of tax 193 863 ( 397 ) 594

Total unrealized (losses) gains, net of tax ( 133 ) 111 ( 530 ) 705

Gross reclassification adjustment for net realized gains included in net earnings ( 20 ) ( 21 ) ( 36 ) ( 50 )

2 unchanged sentences

( 16 ) ( 16 ) ( 28 ) ( 38 )

Total foreign currency translation gains (losses) 554 ( 45 ) 137 ( 1,544 )

Other comprehensive income (loss) 740 810 ( 272 ) ( 972 )

Total foreign currency translation losses ( 621 ) ( 39 ) ( 484 ) ( 1,583 )

Other comprehensive (loss) income ( 770 ) 56 ( 1,042 ) ( 916 )

Comprehensive income 3,421 3,312 12,499 12,501

7 unchanged sentences

Income (Loss) Nonredeemable Noncontrolling Interests Total

Three months ended June 30,

(in millions) Shares Amount Net Unrealized Gains on Investments Foreign Currency Translation (Losses) Gains

Balance at March 31, 2021 944 $ 10 $ — $ 71,220 $ 741 $ ( 5,567 ) $ 2,909 $ 69,313

Three months ended September 30,

(in millions) Shares Amount Net Unrealized Gains (Losses) on Investments Foreign Currency Translation Losses

Balance at June 30, 2021 943 $ 10 $ — $ 73,090 $ 927 $ ( 5,013 ) $ 3,008 $ 72,022

4,086 86 4,172

Other comprehensive income 186 554 740

Other comprehensive loss ( 149 ) ( 621 ) ( 770 )

Issuances of common stock, and related tax effects

6 unchanged sentences

Acquisition and other adjustments of nonredeemable noncontrolling interests

( 26 ) ( 26 )

Distribution to nonredeemable noncontrolling interests

( 87 ) ( 87 )

Balance at September 30, 2021 942 $ 10 $ — $ 75,124 $ 778 $ ( 5,634 ) $ 2,981 $ 73,259

Balance at June 30, 2020 950 $ 10 $ 388 $ 67,776 $ 1,161 $ ( 5,711 ) $ 2,891 $ 66,515

Balance at March 31, 2020 947 $ 10 $ — $ 62,327 $ 306 $ ( 5,666 ) $ 2,886 $ 59,863

3,172 62 3,234

7 unchanged sentences

( 35 ) ( 35 )

Acquisition and other adjustments of nonredeemable noncontrolling interests ( 8 ) ( 8 )

Distribution to nonredeemable noncontrolling interests

( 72 ) ( 72 )

Balance at June 30, 2020 950 $ 10 $ 388 $ 67,776 $ 1,161 $ ( 5,711 ) $ 2,891 $ 66,515

Balance at September 30, 2020 949 $ 10 $ — $ 69,715 $ 1,256 $ ( 5,750 ) $ 2,873 $ 68,104

See Notes to the Condensed Consolidated Financial Statements

3 unchanged sentences

Income (Loss) Nonredeemable Noncontrolling Interests Total

Six months ended June 30,

(in millions) Shares Amount Net Unrealized Gains (Losses) on Investments Foreign Currency Translation (Losses) Gains

Nine months ended September 30,

(in millions) Shares Amount Net Unrealized Gains (Losses) on Investments Foreign Currency Translation Losses

Balance at January 1, 2021 946 $ 10 $ — $ 69,295 $ 1,336 $ ( 5,150 ) $ 2,837 $ 68,328

13,214 254 13,468

Other comprehensive (loss) income ( 409 ) 137 ( 272 )

Other comprehensive loss ( 558 ) ( 484 ) ( 1,042 )

Issuances of common stock, and related tax effects

8 unchanged sentences

( 235 ) ( 235 )

Balance at June 30, 2021 943 $ 10 $ — $ 73,090 $ 927 $ ( 5,013 ) $ 3,008 $ 72,022

Balance at September 30, 2021 942 $ 10 $ — $ 75,124 $ 778 $ ( 5,634 ) $ 2,981 $ 73,259

Balance at January 1, 2020 948 $ 9 $ 7 $ 61,178 $ 589 $ ( 4,167 ) $ 2,820 $ 60,436

12 unchanged sentences

( 148 ) ( 148 )

Balance at June 30, 2020 950 $ 10 $ 388 $ 67,776 $ 1,161 $ ( 5,711 ) $ 2,891 $ 66,515

Balance at September 30, 2020 949 $ 10 $ — $ 69,715 $ 1,256 $ ( 5,750 ) $ 2,873 $ 68,104

See Notes to the Condensed Consolidated Financial Statements

1 unchanged sentence

Condensed Consolidated Statements of Cash Flows

Six Months Ended

Nine Months Ended September 30,

(in millions) 2021 2020

26 unchanged sentences

Repayments of long-term debt ( 1,900 ) ( 1,500 )

(Repayments of) proceeds from short-term borrowings, net ( 176 ) 351

Repayments of short-term borrowings, net ( 1,301 ) ( 423 )

Proceeds from issuance of long-term debt 6,934 4,864

2 unchanged sentences

Other, net ( 837 ) ( 449 )

Cash flows from financing activities 569 3,024

Cash flows used for financing activities ( 3,828 ) ( 1,994 )

Effect of exchange rate changes on cash and cash equivalents ( 45 ) ( 160 )

22 unchanged sentences

(in millions) Amortized

June 30, 2021

September 30, 2021

Debt securities - available-for-sale:

25 unchanged sentences

Total debt securities $ 38,717 $ 1,780 $ ( 22 ) $ 40,475

The Company held $ 2.8 billion and $ 2.3 billion of equity securities as of June 30, 2021 and December 31, 2020, respectively.

The Company held $ 2.9 billion and $ 2.3 billion of equity securities as of September 30, 2021 and December 31, 2020, respectively.

The Company’s investments in equity securities primarily consist of employee savings plan related investments, shares of Brazilian real denominated fixed-income funds with readily determinable fair values and other venture investments.

Additionally, the Company’s investments included $ 1.3 billion of equity method investments in operating businesses in the health care sector as of June 30, 2021 and December 31, 2020.

The allowance for credit losses on held-to-maturity securities at June 30, 2021 and December 31, 2020 was not material.

The amortized cost and fair value of debt securities as of June 30, 2021, by contractual maturity, were as follows:

Additionally, the Company’s investments included $ 1.3 billion of equity method investments in operating businesses in the health care sector as of September 30, 2021 and December 31, 2020.

The allowance for credit losses on held-to-maturity securities at September 30, 2021 and December 31, 2020 was not material.

The amortized cost and fair value of debt securities as of September 30, 2021, by contractual maturity, were as follows:

Available-for-Sale Held-to-Maturity

11 unchanged sentences

(in millions) Fair

June 30, 2021

September 30, 2021

Debt securities - available-for-sale:

16 unchanged sentences

Total debt securities - available-for-sale $ 2,415 $ ( 16 ) $ 549 $ ( 6 ) $ 2,964 $ ( 22 )

The Company’s unrealized losses from debt securities as of June 30, 2021 were generated from approximately 6,500 positions out of a total of 38,000 positions.

The Company’s unrealized losses from debt securities as of September 30, 2021 were generated from approximately 9,000 positions out of a total of 40,000 positions.

The Company believes that it will collect the timely principal and interest due on its debt securities that have an amortized cost in excess of fair value.

2 unchanged sentences

The Company evaluated the expected cash flows, the underlying credit quality and credit ratings of the issuers noting no significant credit deterioration since purchase.

As of June 30, 2021, the Company did not have the intent to sell any of the available-for-sale debt securities in an unrealized loss position.

As of September 30, 2021, the Company did not have the intent to sell any of the available-for-sale debt securities in an unrealized loss position.

Therefore, the Company believes these losses to be temporary.

The allowance for credit losses on available-for-sale debt securities at June 30, 2021 and December 31, 2020 was not material.

The allowance for credit losses on available-for-sale debt securities at September 30, 2021 and December 31, 2020 was not material.

Certain assets and liabilities are measured at fair value in the Condensed Consolidated Financial Statements or have fair values disclosed in the Notes to the Condensed Consolidated Financial Statements.

7 unchanged sentences

Fair and Carrying

June 30, 2021

September 30, 2021

Cash and cash equivalents $ 20,944 $ 141 $ — $ 21,085

23 unchanged sentences

Percentage of total assets at fair value 38 % 61 % 1 % 100 %

There were no transfers in or out of Level 3 financial assets or liabilities during the six months ended June 30, 2021 or 2020.

There were no transfers in or out of Level 3 financial assets or liabilities during the nine months ended September 30, 2021 or 2020.

The following table presents a summary of fair value measurements by level and carrying values for certain financial instruments not measured at fair value on a recurring basis in the Condensed Consolidated Balance Sheets:

4 unchanged sentences

Value Total Carrying Value

June 30, 2021

September 30, 2021

Debt securities - held-to-maturity $ 525 $ 88 $ 7 $ 620 $ 616

4 unchanged sentences

Nonfinancial assets and liabilities or financial assets and liabilities that are measured at fair value on a nonrecurring basis are subject to fair value adjustments only in certain circumstances, such as when the Company records an impairment.

There were no significant fair value adjustments for these assets and liabilities recorded during either the six months ended June 30, 2021 or 2020.

There were no significant fair value adjustments for these assets and liabilities recorded during either the nine months ended September 30, 2021 or 2020.

Medical Costs Payable

The following table shows the components of the change in medical costs payable for the six months ended June 30:

The following table shows the components of the change in medical costs payable for the nine months ended September 30:

(in millions) 2021 2020

11 unchanged sentences

Medical costs payable, end of period $ 25,918 $ 21,167

For the six months ended June 30, 2021 and June 30, 2020, prior years medical cost reserve development was primarily driven by lower than expected health system utilization.

Medical costs payable included reserves for claims incurred by insured customers but not yet reported to the Company of $ 16.9 billion and $ 14.8 billion at June 30, 2021 and December 31, 2020, respectively.

For the nine months ended September 30, 2021 and September 30, 2020, prior years medical cost reserve development was primarily driven by lower than expected health system utilization.

Medical costs payable included reserves for claims incurred by insured customers but not yet reported to the Company of $ 17.6 billion and $ 14.8 billion at September 30, 2021 and December 31, 2020, respectively.

Short-Term Borrowings and Long-Term Debt

14 unchanged sentences

June 29 1.45 1,367

September 21 1.45 1,367

Commitments and Contingencies

18 unchanged sentences

Congressional committees, the U.S.

Department of Justice, the SEC, the Internal Revenue Service, the U.S.

Department of Justice (DOJ), the SEC, the Internal Revenue Service, the U.S.

Drug Enforcement Administration, the U.S.

4 unchanged sentences

CMS has selected certain of the Company’s local plans for risk adjustment data validation (RADV) audits to validate the coding practices of and supporting documentation maintained by health care providers and such audits may result in retrospective adjustments to payments made to the Company’s health plans.

On February 14, 2017, the Department of Justice (DOJ) announced its decision to pursue certain claims within a lawsuit initially asserted against the Company and filed under seal by a whistleblower in 2011.

On February 14, 2017, the DOJ announced its decision to pursue certain claims within a lawsuit initially asserted against the Company and filed under seal by a whistleblower in 2011.

The whistleblower’s complaint, which was unsealed on February 15, 2017, alleges that the Company made improper risk adjustment submissions and violated the False Claims Act.

9 unchanged sentences

Eliminations Consolidated

Three Months Ended June 30, 2021

Three Months Ended September 30, 2021

Revenues - unaffiliated customers:

13 unchanged sentences

$ 2,651 $ 1,143 $ 906 $ 1,012 $ — $ 3,061 $ ( 422 ) $ 5,290

Three Months Ended June 30, 2020

Three Months Ended September 30, 2020

Revenues - unaffiliated customers:

15 unchanged sentences

Eliminations Consolidated

Six Months Ended June 30, 2021

Nine Months Ended September 30, 2021

Revenues - unaffiliated customers:

13 unchanged sentences

$ 9,854 $ 3,233 $ 2,447 $ 2,895 $ — $ 8,575 $ ( 1,229 ) $ 17,200

Six Months Ended June 30, 2020

Nine Months Ended September 30, 2020

Revenues - unaffiliated customers:

14 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements