UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): November 6, 2015

Humana Inc.
(Exact Name of Registrant as Specified in Its Charter)

Delaware
(State or Other Jurisdiction of Incorporation)

1-5975	 	61-0647538	
(Commission
File Number)	 	(IRS Employer
Identification No.)	

500 West Main Street, Louisville, KY	 	40202	
(Address of Principal Executive Offices)	 	(Zip Code)	
502-580-1000
(Registrant’s Telephone Number, Including Area Code)
 
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see  General Instruction A.2. below):
 
 	¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	
 
 	¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	
 
 	¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))	
 
 	¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))	

 

Item 2.02	Results of Operations and Financial Condition.	
 
Item 7.01	Regulation FD Disclosure.	
Humana Inc. issued a press release this morning reporting financial results for the quarter ended September 30, 2015. A copy of the release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
 
Item 9.01	Financial Statements and Exhibits.	
(d) Exhibits:

Exhibit
No.	  	Description	
 	 	
99.1	  	Earnings Release and Statistical Pages	

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

HUMANA INC.	
 	 	
BY:	 	/s/ Cynthia H. Zipperle	
 	 	Cynthia H. Zipperle	
 	 	Vice President, Chief Accounting Officer and Controller	
 	 	(Principal Accounting Officer)	
Dated: November 6, 2015

INDEX TO EXHIBITS

Exhibit
No.	  	Description	
 	 	
99.1	  	Earnings Release and Statistical Pages	

Exhibit 99.1

 	  	Humana Inc.	 	
 	  	500 West Main Street	 	 	
 	  	P.O. Box 1438	 	 	 	
 	  	Louisville, KY 40201-1438	 	 	 	 	
 	  	http://www.humana.com	 	 	 	 	
FOR MORE INFORMATION CONTACT:

Regina Nethery	 	 	
Humana Investor Relations	 	 	
(502) 580-3644	 	 	
e-mail: Rnethery@humana.com	 	 	
 	 	
Tom Noland	 	 	
Humana Corporate Communications	 	 	
(502) 580-3674	 	 	
e-mail: Tnoland@humana.com	 	 	
Humana Reports Third Quarter 2015 Financial Results;
Reaffirms 2015 Adjusted EPS Guidance
 
 	•	 	3Q 2015 Adjusted EPS of $2.16 excludes the impact of $0.07 per share in Aetna transaction costs and is in line with management’s guidance of approximately $2.15 per share	
 
 	•	 	Reaffirmed full-year 2015 Adjusted EPS guidance of approximately $7.75 excluding $1.53 per share of gain on the company’s sale of Concentra and total expected Aetna transaction costs of $0.10 per share	
 
 	•	 	Consolidated revenues up 13 percent year to date	
 
 	•	 	3Q 2015 operating cash flow of $1.03 billion	
LOUISVILLE, KY (November 6, 2015) – Humana Inc. (NYSE: HUM) today reported diluted earnings per common share (EPS) for the quarter ended September 30, 2015 (3Q 2015) of $2.09 compared to $1.85 for the quarter ended September 30, 2014 (3Q 2014). For the nine months ended September 30, 2015 (YTD 2015) the company reported EPS of $7.77 compared to $6.39 in the nine months ended September 30, 2014 (YTD 2014).
The company has included certain adjusted financial measures throughout this earnings press release. Adjusted pretax income and Adjusted EPS for 3Q 2015 and YTD 2015 were as follows  (a) :

Consolidated pretax income (in millions)	  	3Q 2015	 	  	3Q 2014	 	  	YTD 2015	 	  	YTD 2014	 	
GAAP	  	$	648	  	  	$	551	  	  	$	2,185	  	  	$	1,883	  	
Costs associated with proposed transaction with Aetna	  	 	11	  	  	 	—  	  	  	 	11	  	  	 	—  	  	
Gain related to sale of Concentra Inc. (Concentra)	  	 	—  	  	  	 	—  	  	  	 	(267	) 	  	 	—  	  	
Adjusted (non-GAAP)	  	$	659	  	  	$	551	  	  	$	1,929	  	  	$	1,883	  	
 
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Diluted earnings per common share	  	3Q 2015	 	  	3Q 2014	 	  	YTD 2015	 	  	YTD 2014	 	
GAAP	  	$	2.09	  	  	$	1.85	  	  	$	7.77	  	  	$	6.39	  	
Costs associated with proposed transaction with Aetna	  	 	0.07	  	  	 	—  	  	  	 	0.07	  	  	 	—  	  	
Gain related to sale of Concentra	  	 	—  	  	  	 	—  	  	  	 	(1.53	) 	  	 	—  	  	
Adjusted (non-GAAP)	  	$	2.16	  	  	$	1.85	  	  	$	6.31	  	  	$	6.39	  	
The higher year-over-year Adjusted pretax income for the quarter and year to date reflected higher operating results from the Group and Healthcare Services segments and higher investment income associated with repositioning of the investment portfolio, partially offset by lower operating results in the Retail segment. Further discussion of the drivers of the business segment operating results are discussed in the sections below highlighting each segment.
The higher year-over-year Adjusted EPS for the quarter reflected the same factors impacting Adjusted pretax income and the favorable impact of share repurchase activity in the first half of 2015, partially offset by a higher effective tax rate associated with the expected increase in the non-deductible health insurance industry fee. The lower year-over year Adjusted EPS year to date also reflected the same factors impacting Adjusted pretax income for the quarter and the favorable impact of share repurchase activity, but these favorable factors were more than offset by the higher effective tax rate on a year-to-date basis.
“Our third quarter results included operating performance for our Medicare businesses that was generally in line with our expectations and continuing momentum in our Healthcare Services segment, but were challenged by our individual commercial business,” said Bruce D. Broussard, Humana’s President and Chief Executive Officer. “With all this, consumers have been and continue to be at the forefront of our integrated care delivery model, which produces quality care for our members through clinical excellence and a superior consumer experience. Our proposed transaction with Aetna will provide millions more consumers with a new opportunity to engage with innovative wellness and chronic-care programs that have a proven record of measurably improving people’s health and well-being.”
Earnings Guidance
The company reaffirms Adjusted EPS guidance for the year ending December 31, 2015 (FY 2015) of approximately $7.75 as noted below:

Diluted earnings per common share	  	FY 2015	 	
GAAP	  	$	9.18	  	
Estimated costs associated with proposed transaction with Aetna	  	 	0.10	  	
Gain related to sale of Concentra	  	 	(1.53	) 	
Adjusted (non-GAAP)	  	$	7.75	  	
“As we look to 2016, we anticipate marked improvement in our Medicare and individual commercial businesses as a result of actions taken during 2015,” added Brian A. Kane, Senior Vice President and Chief Financial Officer. “However, we remain cautious with regard to our expectations around 2016 earnings growth due to the ongoing challenges in the individual commercial business and as we continue to evaluate the impact of Medicare financial recovery process changes made during 2014.”
A listing of items expected to significantly impact the company’s 2016 earnings are discussed throughout this press release and on page S-24 of the statistical supplement included herein.
 
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The company’s FY 2015 Adjusted EPS guidance includes the following changes from its previous expectations:

Adjusted EPS	  	FY 2015	 	
Guidance – July 2015	  	$	7.75	  	
Medicare Advantage underwriting performance (individual and group)	  	 	0.10	  	
Healthcare Services segment operating performance	  	 	0.38	  	
Administrative cost efficiencies, other discretionary cost reductions and investment income associated with investment portfolio rebalancing	  	 	0.43	  	
Individual commercial medical underwriting performance	  	 	(0.91	) 	
Guidance – November 2015	  	$	7.75	  	
Proposed Transaction
As previously announced, Humana has entered into a definitive merger agreement with Aetna Inc. (Aetna) on July 2, 2015 under which, at the closing, Aetna will acquire each outstanding common share of Humana for $125 in cash and 0.8375 of an Aetna common share. At separate special stockholder meetings each held on October 19, 2015, Humana stockholders approved the adoption of the Aetna merger agreement and Aetna shareholders approved the issuance of the Aetna common stock in the transaction.
The transaction is subject to customary closing conditions, including the expiration of the Hart-Scott-Rodino anti-trust waiting period and approvals of certain state Departments of Insurance and other regulators. The company expects the transaction to close in the second half of 2016.
CONSOLIDATED HIGHLIGHTS
Consolidated revenues
Consolidated revenues (including investment income) for 3Q 2015 were $13.36 billion, an increase of $1.13 billion, or 9 percent, from $12.24 billion in 3Q 2014, with total premiums and services revenues for 3Q 2015 of $13.23 billion increasing $1.09 billion, or 9 percent, from $12.14 billion in 3Q 2014. The year-over-year increase in premiums and services revenues primarily reflected higher Retail and Group segment totals.
Consolidated revenues for YTD 2015 increased $4.76 billion, or 13 percent, to $40.93 billion from $36.17 billion in YTD 2014 with total premiums and services revenues for YTD 2015 of $40.59 billion also up 13 percent, increasing $4.70 billion from $35.89 billion in YTD 2014. Higher Retail and Group segment premiums and services revenues also drove the year-over-year change in YTD 2015.
Investment income for 3Q 2015 of $130 million increased by $35 million from 3Q 2014 due to a repositioning of the investment portfolio as the company took advantage of recent market volatility and anticipated changes to interest rates. This investment portfolio repositioning is expected to be completed by the end of 2015.
 
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Consolidated benefits expense
The 3Q 2015 consolidated benefit ratio (benefits expense as a percent of premiums) of 83.9 percent increased by 60 basis points from 83.3 percent for the prior year’s quarter primarily reflecting higher ratios in both the Retail and Group segments. Prior period medical claims development (Prior Period Development) decreased the 3Q 2015 consolidated benefit ratio by 50 basis points versus 80 basis points in the prior year’s quarter. Excluding Prior Period Development, the consolidated benefit ratios were 84.4 percent and 84.1 percent for 3Q 2015 and 3Q 2014, respectively. Drivers of the segment-level ratios are discussed in the sections below highlighting each segment.
The YTD 2015 consolidated benefit ratio of 84.0 percent increased by 110 basis points from 82.9 percent in YTD 2014. The increase primarily reflects the same factors impacting the third quarter year-over-year comparison. Prior Period Development lowered the YTD 2015 consolidated benefit ratio by 60 basis points versus 130 basis points in YTD 2014. Excluding Prior Period Development, the consolidated benefit ratios were 84.6 percent and 84.2 percent for YTD 2015 and YTD 2014, respectively.
As discussed in the Retail segment highlights below, the company’s consolidated Prior Period Development was primarily from positive Medicare Advantage claims development, partially offset by negative individual commercial claims development. Consolidated Prior Period Development was as follows:

Consolidated Prior Period Development
(in millions)
Favorable (unfavorable)	  	First quarter	 	  	Second quarter	 	  	Third quarter	 	  	YTD	 	
Prior Period Development from 2014 and prior years recognized in FY 2015	  	$	194	  	  	$	(16	) 	  	$	67	  	  	$	245	  	
Prior Period Development from 2013 and prior years recognized in FY 2014	  	$	297	  	  	$	49	  	  	$	94	  	  	$	440	  	
Consolidated operating expenses
The consolidated operating cost ratio (operating costs as a percent of total revenues less investment income) of 12.8 percent for 3Q 2015 decreased 280 basis points from 15.6 percent in 3Q 2014, primarily reflecting lower ratios in the Retail and Group segments as well as the sale of Concentra in June 2015. Drivers of the segment-level ratios are discussed in the sections below highlighting each segment.
The YTD 2015 consolidated operating cost ratio of 13.4 percent decreased 200 basis points from 15.4 percent in YTD 2014, primarily reflecting the same factors impacting the year-over-year comparisons for the third quarter.
Consolidated operating expenses included amortization expense for intangible assets of approximately $22 million and $29 million for 3Q 2015 and 3Q 2014, respectively, and approximately $72 million and $85 million for YTD 2015 and YTD 2014, respectively.
For 2016, the company anticipates higher consolidated operating expenses as discretionary cost reductions implemented in 2015 are expected to return to normal levels in 2016.
 
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Balance sheet
At September 30, 2015, the company had cash, cash equivalents, and investment securities of $10.90 billion, down $231 million from $11.13 billion at June 30, 2015 primarily reflecting net commercial paper repayments of $290 million.
Cash and short-term investments held at the parent company of $1.03 billion at September 30, 2015 decreased $830 million from $1.86 billion at June 30, 2015, primarily reflecting the commercial paper repayment, capital expenditures, payment of stockholder dividends, and the funding of subsidiary working capital requirements.
At September 30, 2015, net receivables of $808 million were associated with premium stabilization programs established under health care reform, commonly referred to as the 3Rs (b) . Approximately 51 percent of the total net 3Rs receivables were related to reinsurance recoverables. At September 30, 2015, net receivables (payables) for the 3Rs were as follows:

Net Amounts Accrued for the 3Rs
(in millions)
Assets (liabilities)	  	Balances Related
to 2014 plan year	 	  	Balances Related
to 2015 plan year	 	  	Total Balances
at 9/30/15	 	
Reinsurance recoverables	  	$	40	  	  	$	371	  	  	$	411	  	
Net risk adjustment settlement	  	 	10	  	  	 	(59	) 	  	 	(49	) 	
Net risk corridor settlement(c)	  	 	241	  	  	 	205	  	  	 	446	  	
Total Net Amounts Accrued for the 3Rs	  	$	291	  	  	$	517	  	  	$	808	  	
Reinsurance recoverables for the 2015 plan year are anticipated to be primarily collected in the third quarter of 2016. Net risk corridor receivables are now anticipated to be primarily collected in future years and thus the related amounts have been classified as long-term receivables as of September 30, 2015.
Days in claims payable of 43.4 at September 30, 2015 increased 2.3 days from 41.1 at June 30, 2015. This change was primarily driven by higher balances in unprocessed claims inventories associated with slower claims processing speed during 3Q 2015 versus the second quarter of 2015.
Debt-to-total capitalization at September 30, 2015 was 27.0 percent, down from 29.0 percent at June 30, 2015 primarily reflecting lower commercial paper balances outstanding at the end of 3Q 2015. Increases in capital associated with 3Q 2015 earnings were partially offset by cash dividends paid during the quarter. As of September 30, 2015, the company had approximately $11 million outstanding on its commercial paper program compared to $300 million at June 30, 2015.
Cash flows from operations
Cash flows provided by operations for 3Q 2015 were $1.03 billion compared to cash flows provided by operations of $954 million in 3Q 2014. This year-over-year change in operating cash flows primarily reflected higher net income as well as changes in working capital items with the favorable impact of net 3Rs receivables collected in the quarter partially offset by payment of the higher non-deductible health insurance industry fee.
For YTD 2015, cash flows provided by operations totaled $531 million versus $1.43 billion of cash flows provided by operations during YTD 2014. This year-over-year decline primarily reflected lower net income excluding the gain on the Concentra sale (proceeds from the sale are recognized in investing cash flows) and the unfavorable
 
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impact of changes in working capital items, primarily driven by the cash flow impact of lower membership growth YTD 2015 compared to YTD 2014. Membership growth rates have a positive cash flow impact because premiums are generally collected in advance of claim payments.
Fourth quarter 2015 cash flows from operations are anticipated to be lower than previously expected primarily due to the delay in collection of risk corridor receivables associated with the 3Rs. Additionally, fourth quarter cash flows are anticipated to be impacted by normal fluctuation in working capital balances.
Share repurchases
In September 2014, the company’s Board of Directors approved a new $2 billion share repurchase authorization with an expiration date of December 31, 2016 that replaced its previous $1 billion share repurchase authorization. Approximately $1.04 billion of the current $2 billion repurchase authorization remains outstanding.
As a result of the proposed transaction with Aetna, the company has suspended its share repurchase program. Consequently, the company did not repurchase shares during 3Q 2015. The company executed repurchases of 967,200 shares for approximately $118 million during 3Q 2014.
Year to date through July 2, 2015 (the date of the merger agreement), the company had repurchased approximately 1,849,800 shares for $329 million. The company repurchased approximately 1,872,600 shares for $230 million during YTD 2014.
In light of the suspension of the company’s share repurchase program discussed above, 2016 EPS is not expected to include any benefit from share repurchases versus an active share repurchase program in the first half of 2015.
Cash dividends
The company paid cash dividends to its stockholders of $43 million in each of 3Q 2015 and 3Q 2014. Cash dividends of $129 million were paid to the company’s stockholders during each of YTD 2015 and YTD 2014. In August 2015, the company’s Board of Directors declared a cash dividend of $0.29 per share, totaling $43 million in the aggregate, which was paid on October 30, 2015 to stockholders of record on September 30, 2015.
The company’s ability and intent to continue its quarterly dividend policy is not impacted by the proposed transaction with Aetna, although the company has agreed with Aetna that its quarterly dividend will not exceed $0.29 per share prior to closing the transaction.
RETAIL SEGMENT(d)
This segment consists of Medicare benefits, marketed to individuals or directly via group accounts, as well as individual commercial fully-insured medical and specialty health insurance benefits, including dental, vision, and other supplemental health and financial protection products. In addition, this segment also includes the company’s contract with the Centers for Medicare and Medicaid Services (CMS) to administer the Limited Income Newly Eligible Transition (LI-NET) prescription drug plan program and contracts with various states to provide Medicaid, dual eligible, and Long-Term Support Services (LTSS) benefits. These contracts are collectively referred to as state-based contracts (e) .
 
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Retail Segment Highlights
While operating performance for the company’s stand-alone PDP and group Medicare Advantage businesses are performing in line with the company’s expectations, as previously disclosed, its individual commercial and Medicare Advantage businesses are facing certain challenges in 2015.
Medicare businesses
The company’s Medicare Advantage operating results year over year reflect significant growth in membership but were negatively impacted by certain pricing assumptions in Humana’s plan designs for 2015 primarily related to lower-than-expected 2015 financial claim recovery levels (included in Prior Period Development) and lower-than-anticipated reductions in inpatient admissions from its clinical programs. Overall, year-over-year hospital admissions have decreased from 2014 and are running slightly favorable versus the company’s expectations as revised in July 2015. The company continues to manage the impact of financial recovery process changes made during 2014.
For 2016, Humana believes it has largely captured the 2015 medical cost experience in its Medicare plan designs submitted to CMS in June 2015. However, the financial recovery process changes discussed above and their potential impact on reserve development may negatively affect the company’s anticipated growth in earnings for 2016.
2016 individual Medicare Advantage net membership growth is anticipated to be in line with overall market growth and is projected to be in the mid to upper single digits on a percentage basis, excluding the loss of approximately 35,000 members from the discontinuance of a product offering in Puerto Rico. Group Medicare Advantage membership for 2016 is projected to be down due to a large account (approximately 145,000 members) converting to a private exchange offering.
Individual commercial business
Operating results for the company’s individual commercial medical business continue to be challenged primarily due to the volatility related to the start of the healthcare exchange program created under the Affordable Care Act (ACA) as well as the morbidity of membership served under this relatively new program. The benefit ratio associated with many of the company’s individual products, in particular ACA-compliant offerings, continue to exceed prior expectations for FY 2015 driven primarily by product designs which attracted a higher-utilizing member base than was assumed when the 2015 plan offerings were priced, in part due to the on-going impact of the transitional policies associated with the program. The transitory nature of the population served has also contributed to use of emergency room services and non-participating providers above priced-for levels.
During 2015, the company has taken a number of actions that are anticipated to improve the profitability of the individual commercial business in 2016. However, the deterioration in claims experience for this business in 3Q 2015, if it continues, would reduce the likelihood of achieving the level of profitability the company had previously anticipated for this business in 2016. The company continues to evaluate its participation in this line of business for 2017.
 
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Steps taken to address challenges in this business during 2015 include:
 
 	•	 	Premium increases for 2016 including the impact of early 2015 claims experience and June 2015 updated risk adjustment data from CMS.	
 
 	•	 	Discontinuance of certain products as well as market exits for 2016, with approximately 100,000 current members expected to be impacted, though approximately 88 percent of those will have other Humana options from which they can choose in addition to offerings in the open market. Product discontinuance for 2016 primarily focuses on off-exchange products as well as platinum metal-tier and broad-network products both on and off exchange. Offerings to be discontinued in 2016 account for a significant portion of the 2015 pretax losses for the individual commercial business.	
 
 	•	 	Network improvements, enhancements to claims and clinical processes and administrative cost right-sizing.	
State-based contracts business
In total, the company’s state-based contracts business continues to perform in line with management’s expectations. State-based business associated with the company’s dual eligible membership is outperforming expectations while its Medicaid Temporary Assistance for Needy Families (TANF) products are underperforming expectations.
For 2016, the company’s state-based contracts business is expected to benefit from the full-year effect of rate increases and operational improvements implemented in 2015.
Retail segment premiums and services revenue:
 
 	•	 	The 3Q 2015 premiums and services revenues for the Retail segment was $11.35 billion, an increase of 14 percent from $9.99 billion in 3Q 2014. The increase resulted primarily from an increase of 12 percent in average Medicare Advantage membership year over year, along with membership growth in the company’s state-based contracts and stand-alone PDP offerings as well as a heavier percentage of individual commercial business in higher premium ACA-compliant plans.	
 
 	•	 	YTD 2015 premium and services revenues for the Retail segment was $34.49 billion, an increase of 17 percent from $29.45 billion in YTD 2014, primarily reflecting the same factors impacting the year-over-year comparison for the third quarter.	
Retail segment enrollment:
 
 	•	 	Individual Medicare Advantage membership was 2,737,100 as of September 30, 2015, an increase of 334,300, or 14 percent, from 2,402,800 at September 30, 2014, and up 309,200, or 13 percent from 2,427,900 as of December 31, 2014, primarily due to net membership additions associated with the 2015 plan year, particularly HMO offerings.	
 
 	•	 	Group Medicare Advantage membership was 481,300 as of September 30, 2015, a decrease of 3,600, or 1 percent, from 484,900 at September 30, 2014 and down 8,400, or 2 percent, from 489,700 at December 31, 2014. The decline from December 31, 2014 primarily reflects the loss of a large group account.	
 
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 	•	 	Membership in the company’s stand-alone PDP offerings was 4,509,600 as of September 30, 2015, an increase of 568,800 or 14 percent, from 3,940,800 at September 30, 2014, and up 515,600, or 13 percent from 3,994,000 as of December 31, 2014. These increases primarily resulted from growth in the company’s low-priced Humana-Walmart plan offering for the 2015 plan year.	
 
 	•	 	Individual commercial membership decreased to 963,700 as of September 30, 2015, down 122,100, or 11 percent, from 1,085,800 at September 30, 2014, and down 52,500, or 5 percent from 1,016,200 at December 31, 2014. These declines were primarily driven by the loss of approximately 150,000 members due to termination by CMS for lack of proper immigration documentation and/or income status. Individual commercial membership changes both year over year and year to date also reflect the loss of members who had subscribed to non-ACA-compliant plans, partially offset by growth in ACA-compliant plans, primarily off-exchange. Further, the membership change from 3Q 2014 to 3Q 2015 reflected the loss of membership in the fourth quarter 2014 associated with non-payment of premiums.	
 
 	•	 	State-based Medicaid membership was 368,400 as of September 30, 2015 (including 16,600 dual-eligible demonstration members), an increase of 72,100, or 24 percent, from 296,300 (including 15,100 dual-eligible demonstration members) at September 30, 2014, and up 51,600, or 16 percent, from 316,800 (including 18,300 dual-eligible demonstration members) at December 31, 2014. These increases were primarily driven by the addition of membership from state-based contracts for the Florida Medicaid business.	
 
 	•	 	Membership in individual specialty products(f) was 1,187,300 as of September 30, 2015, a decrease of 32,200, or 3 percent, from 1,219,500 at September 30, 2014, but up 21,500, or 2 percent, from 1,165,800 at December 31, 2014. The year-over-year decrease in membership primarily reflects lower membership in supplemental health and financial protection product offerings.	
Retail segment benefits expense:
 
 	•	 	The 3Q 2015 benefit ratio for the Retail segment of 86.1 percent increased 120 basis points from 84.9 percent in 3Q 2014 primarily due to higher than expected medical costs as compared to the assumptions used in the company’s pricing for its individual commercial and Medicare Advantage products for 2015. Additionally, the benefit ratio was increased by the impact of unfavorable year-over-year comparisons of Prior Period Development and higher benefit ratios associated with a greater number of members in state-based contracts. Prior Period Development decreased the 3Q 2015 Retail segment benefit ratio by 60 basis points versus 80 basis points for 3Q 2014. Excluding Prior Period Development, the Retail segment benefit ratios were 86.7 percent and 85.7 percent for 3Q 2015 and 3Q 2014, respectively.	
 
 	•	 	The YTD 2015 benefit ratio for the Retail segment of 86.4 percent was 120 basis points higher than the YTD 2014 ratio of 85.2 percent, primarily reflecting the same factors impacting the year-over-year comparisons for the third quarter as well as the change in estimate for 2014 net 3Rs receivables. The YTD 2015 benefit ratio was also favorably impacted by the release of reserves for future policy benefits as individual commercial medical members transitioned to ACA-compliant plans. Prior Period Development lowered the YTD 2015 Retail segment benefit ratio by 70 basis points and by 140 basis points in YTD 2014. Excluding Prior Period Development, the Retail segment benefit ratios were 87.1 percent and 86.6 percent for YTD 2015 and YTD 2014, respectively.	
 
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 	•	 	The Retail segment Prior Period Development declined approximately $18 million year over year for 3Q 2015 and $176 million year over year for YTD 2015 primarily reflecting the impact of lower financial claim recoveries due in part to the company’s implementation of a front-end review of certain claims, flu-associated claims from the fourth quarter of 2014, and continued volatility in claims associated with individual commercial medical products. Retail segment Prior Period Development was as follows:	

Retail Segment Prior Period Development
(in millions)
Favorable (unfavorable)	  	First quarter	 	  	Second quarter	 	  	Third quarter	 	  	YTD	 	
Prior Period Development from 2014 and prior years recognized in FY 2015	  	$	188	  	  	$	(11	) 	  	$	65	  	  	$	242	  	
Prior Period Development from 2013 and prior years recognized in FY 2014	  	$	277	  	  	$	58	  	  	$	83	  	  	$	418	  	
Retail segment operating costs:
 
 	•	 	The Retail segment’s operating cost ratio of 10.9 percent in 3Q 2015 decreased 70 basis points from 11.6 percent in 3Q 2014. The decrease primarily resulted from administrative cost efficiencies associated with medical membership growth in the segment and other discretionary cost reductions, partially offset by an increase in the non-deductible health insurance industry fee mandated by health care reform. The non-deductible health insurance industry fee increased the Retail segment’s operating cost ratio by approximately 170 basis points in 3Q 2015 and 120 basis points in 3Q 2014. Excluding the industry fee, the Retail segment operating cost ratios were 9.2 percent and 10.4 percent for 3Q 2015 and 3Q 2014, respectively.	
 
 	•	 	The Retail segment’s YTD 2015 operating cost ratio of 10.8 percent decreased 20 basis points from 11.0 percent in YTD 2014. The non-deductible health insurance industry fee increased the Retail segment’s operating cost ratio by approximately 160 basis points in YTD 2015 and 120 basis points in YTD 2014. Excluding the industry fee, the Retail segment operating cost ratios were 9.2 percent and 9.8 percent for YTD 2015 and YTD 2014, respectively, reflecting scale efficiencies within the segment.	
Retail segment pretax results:
 
 	•	 	Retail segment pretax income of $325 million in 3Q 2015 compared to $346 million in 3Q 2014, a decrease of $21 million, as a decline in the segment’s operating cost ratio, growth in Medicare Advantage membership, discretionary cost reductions and higher investment income were more than offset by an increase in the benefit ratio.	
 
 	•	 	For YTD 2015, pretax income for the Retail Segment of $960 million decreased by $155 million from YTD 2014 pretax earnings of $1.12 billion. The YTD 2015 decrease primarily reflected the same factors impacting the quarterly comparison.	
GROUP SEGMENT(d)
This segment consists of employer group commercial fully-insured medical and specialty health insurance benefits, including dental, vision, and other supplemental health and voluntary insurance benefits, as well as Administrative Services Only (ASO) products. In addition, the Group segment includes health and wellness products (primarily marketed to employer groups) and military services business, primarily the TRICARE South Region contract.
 
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Group Segment Highlights
The Group segment’s operating performance is generally in line with company expectations as fully-insured medical operating results were substantially offset by performance in the company’s specialty, wellness and TRICARE operations.
Group segment premiums and services revenue:
 
 	•	 	The 3Q 2015 premiums and services revenues for the Group segment was $1.82 billion, up less than 1 percent from $1.81 billion in 3Q 2014, primarily reflecting an increase in fully-insured commercial medical per-member premiums, partially offset by declines in average fully-insured and ASO commercial group medical membership.	
 
 	•	 	For YTD 2015 premium and services revenues for the Group segment was $5.52 billion, an increase of 2 percent from $5.43 billion in YTD 2014, primarily reflecting the same factors impacting the year-over-year comparison for the third quarter.	
Group segment enrollment:
 
 	•	 	Group fully-insured commercial medical membership was 1,167,400 at September 30, 2015, a decrease of 44,900, or 4 percent, from 1,212,300 at September 30, 2014, and was down 68,100, or 6 percent, from 1,235,500 at December 31, 2014 reflecting lower membership in both large group and small group accounts for each comparative period. Approximately 65 percent of group fully-insured commercial medical membership was in small group accounts (2-100 sized employer groups) at September 30, 2015 and December 31, 2014 versus 63 percent at September 30, 2014.	
 
 	•	 	Group ASO commercial medical membership was 709,800 at September 30, 2015, a decline of 402,100, or 36 percent, from 1,111,900 at September 30, 2014, and down 394,500, or 36 percent from 1,104,300 at December 31, 2014. This decline primarily reflects the loss of certain large group accounts due to continued discipline in pricing of services for self-funded accounts amid a highly competitive environment.	
 
 	•	 	Military services membership was 3,082,700 at September 30, 2015, generally unchanged with a decrease of 2,900, or less than 1 percent, from 3,085,600 at September 30, 2014, and down 7,700, or less than 1 percent, from 3,090,400 at December 31, 2014.	
 
 	•	 	Membership in Group specialty products was 6,090,700 at September 30, 2015, a decline of 434,600, or 7 percent, from 6,525,300 at September 30, 2014, and down 412,000, or 6 percent, from 6,502,700 at December 31, 2014. This decrease primarily resulted from the loss of certain fully-insured group medical accounts that also had specialty coverage.	
 
 	•	 	Membership in HumanaVitality®, the company’s wellness and loyalty rewards program, was 3,901,100 at September 30, 2015, an increase of 62,300, or 2 percent, from 3,838,800 at September 30, 2014, and up 44,300, or 1 percent, from 3,856,800 at December 31, 2014 primarily due to individual Medicare Advantage growth as well as growth in stand-alone sales.	
Group segment benefits expense:
 
 	•	 	The 3Q 2015 benefit ratio for the Group segment was 82.4 percent, an increase of 40 basis points from 82.0 percent for 3Q 2014. The year-over-year increase in the benefit ratio primarily reflected lower Prior Period Development year over year. Prior Period Development decreased the Group segment benefit ratio by 20 basis points in 3Q 2015 and 60 basis points 3Q 2014. Excluding Prior Period Development, the Group segment benefit ratio was 82.6 percent in both 3Q 2015 and 3Q 2014.	
 
11

 	•	 	The YTD 2015 benefit ratio for the Group segment of 79.2 percent increased 140 basis points from the 77.8 percent ratio for YTD 2014, primarily reflecting the impact of higher specialty drug costs, net of rebates, as well as higher outpatient costs and lower prior period development, partially offset by an increase in the non-deductible health insurance industry fee included in the pricing of the company’s products. Prior Period Development did not materially impact the Group segment benefit ratio in YTD 2015 and lowered the ratio by 50 basis points in YTD 2014. Excluding Prior Period Development, the Group segment benefit ratio was 78.3 for YTD 2014.	
Group segment operating costs:
 
 	•	 	The Group segment’s operating cost ratio was 23.4 percent in 3Q 2015, a decrease of 240 basis points from 25.8 percent in 3Q 2014, primarily reflecting the loss of certain large ASO accounts resulting in a lower percentage of ASO business (which carries a higher operating cost ratio than fully-insured commercial business) as well as operating cost efficiencies associated with the fully-insured business as a result of cost reduction initiatives. These decreases were partially offset by the increase of the non-deductible health insurance industry fee mandated by health care reform. The non-deductible health insurance industry fee impacted the Group segment’s operating cost ratio by approximately 140 basis points in 3Q 2015 and 100 basis points in 3Q 2014. Excluding the industry fee, the Group segment operating cost ratios were 22.0 percent and 24.8 percent for 3Q 2015 and 3Q 2014, respectively.	
 
 	•	 	The Group segment’s operating cost ratio of 24.0 percent for YTD 2015 was down 260 basis points compared to 26.6 percent for YTD 2014 primarily reflecting the same factors impacting the year-over-year comparison for the third quarter. The non-deductible health insurance industry fee also impacted the Group segment’s operating cost ratio by approximately 140 basis points in YTD 2015 and 100 basis points in YTD 2014. Excluding the industry fee, the Group segment operating cost ratios were 22.6 percent and 25.6 percent for YTD 2015 and YTD 2014, respectively.	
Group segment pretax results:
 
 	•	 	The 3Q 2015 Group segment pretax income of $39 million increased from pretax income of $1 million in 3Q 2014, primarily reflecting the segment’s lower operating cost ratio, partially offset by an increase in the segment’s benefit ratio.	
 
 	•	 	For YTD 2015, pretax income for the Group segment of $236 million increased by $61 million versus YTD 2014 pretax earnings of $175 million. The YTD 2015 increase primarily reflects the same factors impacting the quarterly comparisons.	
 
12

HEALTHCARE SERVICES SEGMENT(d)
This segment includes services offered to the company’s health plan members as well as to third parties, including pharmacy solutions, provider services, home based services, and clinical programs, as well as services and capabilities to advance population health.
Healthcare Services Segment Highlights
Operating performance for the Healthcare Services segment continues to exceed previous expectations, primarily driven by pharmacy related cost reduction initiatives as well as higher mail order and specialty pharmacy usage. Additionally, high levels of Medicare membership growth as well as increased engagement of members in clinical programs, have resulted in higher usage of services across this segment. The segment’s YTD 2015 results reflect the sale of Concentra on June 1, 2015, with the gain on that sale being reported in the Corporate results.
For 2016, the company anticipates continued segment profit growth at a somewhat slower rate due primarily to an expectation for individual Medicare Advantage membership to grow in line with the overall market (versus outsized growth in prior years), the negative impact on the company’s provider businesses of CMS’ 2016 risk coding recalibration and loss of earnings from Concentra due to the sale of that business in June 2015.
Healthcare Services segment revenues:
 
 	•	 	Revenue of $5.97 billion in 3Q 2015 for the Healthcare Services segment increased $780 million, or 15 percent, from $5.19 billion in 3Q 2014, primarily due to growth in the company’s Medicare membership which resulted in higher utilization of the healthcare services businesses, partially offset by lower revenues due to the sale of the Concentra business in June 2015.	
 
 	•	 	YTD 2015 revenue for the Healthcare Services segment was $17.83 billion, an increase of $2.97 billion, or 20 percent from $14.86 billion in YTD 2014, primarily reflecting the same factors impacting the year-over-year comparison for the third quarter.	
Healthcare Services segment operating costs:
 
 	•	 	The Healthcare Services segment’s operating cost ratio of 94.7 percent in 3Q 2015 decreased 70 basis points from 95.4 percent in 3Q14 primarily due to increased profitability in the company’s pharmacy business. Improving operating performance in the pharmacy business was primarily driven by lower cost of goods associated with increased purchasing scale, lower cost to fill and improvements in technology leading to higher efficiencies year over year.	
 
 	•	 	The Healthcare Services segment’s operating cost ratio of 95.2 percent for YTD 2015 was relatively unchanged compared to 95.3 percent for YTD 2014.	
Healthcare Services segment operating statistics:
 
 	•	 	Primary care providers in value-based (shared risk and path to risk) relationships of 44,200 at September 30, 2015 increased 15 percent from 38,500 at September 30, 2014, and increased 5 percent from 42,300 at December 31, 2014. At September 30, 2015, 59 percent of the company’s individual Medicare Advantage members were in value-based relationships, compared to 54 percent at December 31, 2014, and 53 percent at September 30, 2014.	
 
13

 	•	 	Medicare Advantage membership in the Humana Chronic Care Program rose to 548,000 at September 30, 2015, up 44 percent from 379,900 at September 30, 2014, and up 30 percent from 420,700 at December 31, 2014, reflecting enhanced predictive modeling capabilities and focus on proactive clinical outreach and member engagement.	
 
 	•	 	Pharmacy script volumes of 100.6 million for the quarter ended September 30, 2015 increased 20 percent compared to 83.5 million for the quarter ended September 30, 2014, driven primarily by higher average medical membership.	
 
 	•	 	YTD 2015 pharmacy script volumes of 295.1 million increased 21 percent compared to 243.7 million for YTD 2015 primarily reflecting the same factor impacting the year-over-year comparison for the third quarter.	
Healthcare Services segment pretax results:
 
 	•	 	Healthcare Services segment pretax income of $284 million in 3Q 2015 increased by $81 million from $203 million in 3Q 2014, primarily due to revenue growth from the pharmacy solutions and home based services businesses, as they serve the company’s growing Medicare membership.	
 
 	•	 	YTD 2015 pretax income for the Healthcare Services segment of $737 million increased by $143 million from YTD 2014 pretax earnings of $594 million, primarily reflecting the same factors impacting year-over-year comparisons.	
Footnotes
 
(a)	Adjusted pretax income and Adjusted EPS for 3Q 2015 excludes pretax transaction costs of $11 million, or $0.07 per share, associated with the proposed transaction with Aetna. Adjusted pretax income and Adjusted EPS for YTD 2015 excludes the Aetna transaction costs as well as a pretax gain of approximately $267 million, or $1.53 per share, associated with the completion of the company’s sale of its wholly-owned subsidiary, Concentra Inc. on June 1, 2015.	
The company has included these financial measures (which are not in accordance with Generally Accepted Accounting Principles (GAAP)) in its summary of financial results within this earnings press release as management believes that these measures, when presented in conjunction with the comparable GAAP measures, are useful to both management and its investors in analyzing the company’s ongoing business and operating performance. The excluded items described herein are not a recurring part of the company’s operating plan. Consequently, management uses these non-GAAP financial measures as indicators of business performance, as well as for operational planning and decision making purposes. Non-GAAP financial measures should be considered in addition to, but not as a substitute for, or superior to, financial measures prepared in accordance with GAAP.
 
(b)	Under health care reform, premium stabilization programs, commonly referred to as the 3Rs, became effective January 1, 2014. These programs include a permanent risk adjustment program, a transitional reinsurance program, and a temporary risk corridors program designed to more evenly spread the financial risk borne by issuers and to mitigate the risk that issuers would have mispriced products. In each case, operation of the program is subject to appropriation or other federal administrative action.	
(c)	On October 1, 2015, Humana and other industry participants received notification from CMS that 12.6 percent of risk corridor receivables for the 2014 coverage year would be paid between December 2015 and January 2016 based on expected risk corridor collections for the 2014 coverage year. The risk corridor program is a three-year program and guidance from the Department of Health and Human Services (HHS) provides that risk corridor collections over the life of the three-year program will first be applied to any shortfalls from previous benefit years before application to current year obligations. Subsequent to the October 1, 2015 notification from CMS, HHS reiterated its recognition that the ACA requires the Secretary of HHS to make full payments to issuers, and that amounts unpaid following the 12.6 percent payment will be recorded as obligations of the United States Government for which full payment is required. In the event of a shortfall for the 2016 program year, HHS has asserted it will explore other sources of funding for risk corridors payments, subject to the availability of appropriations, including working with Congress on the necessary funding for outstanding risk corridor payments.	
(d)	On January 1, 2015, the company realigned certain of its businesses among its financial reporting segments to correspond with internal management reporting changes and renamed its Employer Group segment the Group segment. The company’s three reportable segments remain Retail, Group, and Healthcare Services.	
 
14

(e)	State-based contracts include the company’s operations and membership associated with Medicaid benefits provided for dual-eligible demonstration, Temporary Assistance for Needy Families (TANF), and Long-Term Support Services (LTSS) programs.	
(f)	The company provides a full range of insured specialty products including dental, vision, other supplemental health, financial protection, and voluntary insurance benefits. Members included in these products may not be unique to each product since members have the ability to enroll in multiple products. Other supplemental benefits include life, disability, and fixed benefit products including cancer and critical illness policies.	
Conference Call
Given the proposed transaction with Aetna, the company is not hosting a conference call in conjunction with its 3Q 2015 earnings release and does not expect to do so for future quarters. Please direct any questions regarding this earnings press release to Humana Investor Relations or Humana Corporate Communications.
Cautionary Statement
This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When used in investor presentations, press releases, Securities and Exchange Commission (SEC) filings, and in oral statements made by or with the approval of one of Humana’s executive officers, the words or phrases like “expects,” “believes,” “anticipates,” “intends,” “likely will result,” “estimates,” “projects” or variations of such words and similar expressions are intended to identify such forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and assumptions, including, among other things, information set forth in the “Risk Factors” section of the company’s SEC filings, a summary of which includes but is not limited to the following:
 
 	•	 	Humana’s transaction with Aetna is subject to various closing conditions, including governmental and regulatory approvals as well as other uncertainties and there can be no assurances as to whether and when it may be completed.	
 
 	•	 	The merger agreement between Humana and Aetna prohibits Humana from pursuing alternative transactions to the proposed transaction with Aetna.	
 
 	•	 	The number of shares of Aetna common stock that Humana’s stockholders will receive in the transaction is based on a fixed exchange ratio. Because the market price of Aetna’s common stock will fluctuate, Humana’s stockholders cannot be certain of the value of the portion of the transaction consideration to be paid in Aetna’s common stock.	
 
 	•	 	While the transaction with Aetna is pending, Humana is subject to business uncertainties and contractual restrictions that could materially adversely affect Humana’s results of operations, financial position and cash flows or result in a loss of employees, customers, members or suppliers.	
 
 	•	 	Failure to consummate the transaction with Aetna could negatively impact Humana’s results of operations, financial position and cash flows.	
 
 	•	 	If Humana does not design and price its products properly and competitively, if the premiums Humana receives are insufficient to cover the cost of health care services delivered to its members, if the company is unable to implement clinical initiatives to provide a better health care experience for its members, lower costs and appropriately document the risk profile of its members, or if its estimates of benefits expense are inadequate, Humana’s profitability could be materially adversely affected. Humana estimates the costs of its benefit expense payments, and designs and prices its products accordingly, using actuarial methods and assumptions based upon, among other relevant factors, claim payment patterns, medical cost inflation, and historical developments such as claim inventory levels and claim receipt patterns. These estimates, however, involve extensive judgment, and have considerable inherent variability because they are extremely sensitive to changes in claim payment patterns and medical cost trends.	
 
 	•	 	If Humana fails to effectively implement its operational and strategic initiatives, particularly its Medicare initiatives, state-based contract strategy, and its participation in the new health insurance exchanges, the company’s business may be materially adversely affected, which is of particular importance given the concentration of the company’s revenues in these products.	
 
 	•	 	If Humana fails to properly maintain the integrity of its data, to strategically implement new information systems, to protect Humana’s proprietary rights to its systems, or to defend against cyber-security attacks, the company’s business may be materially adversely affected.	
 
 	•	 	Humana’s business may be materially adversely impacted by the adoption of a new coding set for diagnoses (commonly known as ICD-10), the implementation of which became effective on October 1, 2015.	
 
 	•	 	Humana is involved in various legal actions, or disputes that could lead to legal actions (such as, among other things, provider contract disputes relating to rate adjustments resulting from the Balanced Budget and Emergency Deficit Control Act of 1985, as amended, commonly referred to as “sequestration”; other provider contract disputes; and qui tam litigation brought by individuals on behalf of the government) and governmental and internal investigations, any of which, if resolved unfavorably to the company, could result in substantial monetary damages or changes in its business practices. Increased litigation and negative publicity could also increase the company’s cost of doing business.	
 
15

 	•	 	As a government contractor, Humana is exposed to risks that may materially adversely affect its business or its willingness or ability to participate in government health care programs including, among other things, loss of material government contracts, governmental audits and investigations, potential inadequacy of government-determined payment rates, potential restrictions on profitability, including by comparison of profitability of the company’s Medicare Advantage business to non-Medicare Advantage business, or other changes in the governmental programs in which Humana participates.	
 
 	•	 	The Health Care Reform Law, including The Patient Protection and Affordable Care Act and The Health Care and Education Reconciliation Act of 2010, could have a material adverse effect on Humana’s results of operations, including restricting revenue, enrollment and premium growth in certain products and market segments, restricting the company’s ability to expand into new markets, increasing the company’s medical and operating costs by, among other things, requiring a minimum benefit ratio on insured products, lowering the company’s Medicare payment rates and increasing the company’s expenses associated with a non-deductible health insurance industry fee and other assessments; the company’s financial position, including the company’s ability to maintain the value of its goodwill; and the company’s cash flows.	
 
 	•	 	Humana’s participation in the new federal and state health care exchanges, which entail uncertainties associated with mix, volume of business, and the operation of premium stabilization programs, which are subject to federal administrative action, could adversely affect the company’s results of operations, financial position, and cash flows.	
 
 	•	 	Humana’s business activities are subject to substantial government regulation. New laws or regulations, or changes in existing laws or regulations or their manner of application could increase the company’s cost of doing business and may adversely affect the company’s business, profitability and cash flows.	
 
 	•	 	If Humana fails to develop and maintain satisfactory relationships with the providers of care to its members, the company’s business may be adversely affected.	
 
 	•	 	Humana’s pharmacy business is highly competitive and subjects it to regulations in addition to those the company faces with its core health benefits businesses.	
 
 	•	 	Changes in the prescription drug industry pricing benchmarks may adversely affect Humana’s financial performance.	
 
 	•	 	If Humana does not continue to earn and retain purchase discounts and volume rebates from pharmaceutical manufacturers at current levels, Humana’s gross margins may decline.	
 
 	•	 	Humana’s ability to obtain funds from certain of its licensed subsidiaries is restricted by state insurance regulations.	
 
 	•	 	Downgrades in Humana’s debt ratings, should they occur, may adversely affect its business, results of operations, and financial condition.	
 
 	•	 	The securities and credit markets may experience volatility and disruption, which may adversely affect Humana’s business.	
In making forward-looking statements, Humana is not undertaking to address or update them in future filings or communications regarding its business or results. In light of these risks, uncertainties, and assumptions, the forward-looking events discussed herein may or may not occur. There also may be other risks that the company is unable to predict at this time. Any of these risks and uncertainties may cause actual results to differ materially from the results discussed in the forward-looking statements.
Humana advises investors to read the following documents as filed by the company with the SEC for further discussion both of the risks it faces and its historical performance:
 
 	•	 	Form 10-K for the year ended December 31, 2014;	
 
 	•	 	Form 10-Q for the quarters ended March 31, 2015 and June 30, 2015 and	
 
 	•	 	Form 8-Ks filed during 2015.	
About Humana
Humana Inc., headquartered in Louisville, Ky., is a leading health and well-being company focused on making it easy for people to achieve their best health with clinical excellence through coordinated care. The company’s strategy integrates care delivery, the member experience, and clinical and consumer insights to encourage engagement, behavior change, proactive clinical outreach and wellness for the millions of people we serve across the country.
More information regarding Humana is available to investors via the Investor Relations page of the company’s web site at www.humana.com , including copies of:
 
 	•	 	Annual reports to stockholders	
 
 	•	 	Securities and Exchange Commission filings	
 
 	•	 	Most recent investor conference presentations	
 
16

 	•	 	Quarterly earnings news releases	
 
 	•	 	Replays of most recent earnings release conference calls	
 
 	•	 	Calendar of events	
 
 	•	 	Corporate Governance information	
 
17

Humana Inc.
Statistical Schedules
And
Supplementary Information
3Q15 Earnings Release

S-1

Humana Inc.
Statistical Schedules and Supplementary Information
3Q15 Earnings Release
Contents

Page	  	Description	
S-3-4	  	Consolidated Statements of Income	
S-5-6	  	Quarterly Segment Financial Information	
S-7-8	  	YTD Segment Financial Information	
S-9	  	Consolidated Balance Sheets	
S-10-11	  	Consolidated Statements of Cash Flows	
S-12	  	Key Income Statement Ratios and Segment Operating Results	
S-13-15	  	Healthcare Services Segment Metrics	
S-16	  	Ending Membership Detail	
S-17-18	  	Premiums and Services Revenue Detail	
S-19	  	Medicare Summary	
S-20	  	Investments	
S-21-23	  	Benefits Payable Detail and Statistics	
S-24	  	Items Expected to Significantly Impact 2016 Humana Inc. Earnings	
S-25	  	Footnotes	
 
S-2

Humana Inc.
Consolidated Statements of Income
Dollars in millions, except per common share results

 	  	Three Months Ended September 30,	 	  	Dollar
Change	 	 	Percentage
Change	 	 	
 	  	2015	 	  	2014	 	  	 	 	 	 	 	 	
Revenues:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Premiums	  	$	12,987	  	  	$	11,607	  	  	$	1,380	  	 	 	11.9	% 	 	
Services	  	 	246	  	  	 	536	  	  	 	(290	) 	 	 	-54.1	% 	 	
Investment income	  	 	130	  	  	 	95	  	  	 	35	  	 	 	36.8	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Total revenues	  	 	13,363	  	  	 	12,238	  	  	 	1,125	  	 	 	9.2	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Operating expenses:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Benefits	  	 	10,896	  	  	 	9,666	  	  	 	1,230	  	 	 	12.7	% 	 	
Operating costs	  	 	1,688	  	  	 	1,898	  	  	 	(210	) 	 	 	-11.1	% 	 	
Depreciation and amortization	  	 	84	  	  	 	85	  	  	 	(1	) 	 	 	-1.2	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Total operating expenses	  	 	12,668	  	  	 	11,649	  	  	 	1,019	  	 	 	8.7	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Income from operations	  	 	695	  	  	 	589	  	  	 	106	  	 	 	18.0	% 	 	
Interest expense	  	 	47	  	  	 	38	  	  	 	9	  	 	 	23.7	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Income before income taxes	  	 	648	  	  	 	551	  	  	 	97	  	 	 	17.6	% 	 	
Provision for income taxes	  	 	334	  	  	 	261	  	  	 	73	  	 	 	28.0	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Net income	  	$	314	  	  	$	290	  	  	$	24	  	 	 	8.3	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Basic earnings per common share	  	$	2.11	  	  	$	1.87	  	  	$	0.24	  	 	 	12.8	% 	 	
Diluted earnings per common share	  	$	2.09	  	  	$	1.85	  	  	$	0.24	  	 	 	13.0	% 	 	
Shares used in computing basic earnings per common share (000’s)	  	 	148,889	  	  	 	154,502	  	  	 	 	 	 	 	 	 	 	
Shares used in computing diluted earnings per common share (000’s)	  	 	150,466	  	  	 	156,230	  	  	 	 	 	 	 	 	 	 	
 
S-3

Humana Inc.
Consolidated Statements of Income
Dollars in millions, except per common share results

 	  	Nine months ended September 30,	 	  	Dollar
Change	 	 	Percentage
Change	 	 	
 	  	2015	 	  	2014	 	  	 	 	 	 	 	 	
Revenues:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Premiums	  	$	39,447	  	  	$	34,274	  	  	$	5,173	  	 	 	15.1	% 	 	
Services	  	 	1,143	  	  	 	1,620	  	  	 	(477	) 	 	 	-29.4	% 	 	
Investment income	  	 	338	  	  	 	278	  	  	 	60	  	 	 	21.6	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Total revenues	  	 	40,928	  	  	 	36,172	  	  	 	4,756	  	 	 	13.1	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Operating expenses:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Benefits	  	 	33,153	  	  	 	28,417	  	  	 	4,736	  	 	 	16.7	% 	 	
Operating costs	  	 	5,450	  	  	 	5,518	  	  	 	(68	) 	 	 	-1.2	% 	 	
Depreciation and amortization	  	 	267	  	  	 	246	  	  	 	21	  	 	 	8.5	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Total operating expenses	  	 	38,870	  	  	 	34,181	  	  	 	4,689	  	 	 	13.7	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Income from operations	  	 	2,058	  	  	 	1,991	  	  	 	67	  	 	 	3.4	% 	 	
Gain on sale of business	  	 	267	  	  	 	—  	  	  	 	267	  	 	 	n/a	  	 	
Interest expense	  	 	140	  	  	 	108	  	  	 	32	  	 	 	29.6	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Income before income taxes	  	 	2,185	  	  	 	1,883	  	  	 	302	  	 	 	16.0	% 	 	
Provision for income taxes	  	 	1,010	  	  	 	881	  	  	 	129	  	 	 	14.6	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Net income	  	$	1,175	  	  	$	1,002	  	  	$	173	  	 	 	17.3	% 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	
Basic earnings per common share	  	$	7.85	  	  	$	6.46	  	  	$	1.39	  	 	 	21.5	% 	 	
Diluted earnings per common share	  	$	7.77	  	  	$	6.39	  	  	$	1.38	  	 	 	21.6	% 	 	
Shares used in computing basic earnings per common share (000’s)	  	 	149,617	  	  	 	155,006	  	  	 	 	 	 	 	 	 	 	
Shares used in computing diluted earnings per common share (000’s)	  	 	151,321	  	  	 	156,641	  	  	 	 	 	 	 	 	 	 	
 
S-4

Humana Inc.
3Q15 Segment Financial Information
In millions

 	  	 	 	 	 	 	 	Healthcare	 	 	Other	 	  	Eliminations/	 	 	 	 	
 	  	Retail	 	 	Group	 	 	Services	 	 	Businesses	 	  	Corporate	 	 	Consolidated	 	
Revenues—external customers	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Premiums:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Individual Medicare Advantage	  	$	7,316	  	 	$	—  	  	 	$	—  	  	 	$	—  	  	  	$	—  	  	 	$	7,316	  	
Group Medicare Advantage	  	 	1,396	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	1,396	  	
Medicare stand-alone PDP	  	 	927	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	927	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total Medicare	  	 	9,639	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	9,639	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Fully-insured	  	 	1,056	  	 	 	1,362	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	2,418	  	
Specialty	  	 	66	  	 	 	260	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	326	  	
Medicaid and other (A)	  	 	592	  	 	 	6	  	 	 	—  	  	 	 	6	  	  	 	—  	  	 	 	604	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total premiums	  	 	11,353	  	 	 	1,628	  	 	 	—  	  	 	 	6	  	  	 	—  	  	 	 	12,987	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Services revenue:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Provider	  	 	—  	  	 	 	9	  	 	 	61	  	 	 	—  	  	  	 	—  	  	 	 	70	  	
ASO and other (B)	  	 	1	  	 	 	162	  	 	 	—  	  	 	 	5	  	  	 	—  	  	 	 	168	  	
Pharmacy	  	 	—  	  	 	 	—  	  	 	 	8	  	 	 	—  	  	  	 	—  	  	 	 	8	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total services revenue	  	 	1	  	 	 	171	  	 	 	69	  	 	 	5	  	  	 	—  	  	 	 	246	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total revenues—external customers	  	 	11,354	  	 	 	1,799	  	 	 	69	  	 	 	11	  	  	 	—  	  	 	 	13,233	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Intersegment revenues	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Services	  	 	—  	  	 	 	24	  	 	 	4,633	  	 	 	—  	  	  	 	(4,657	) 	 	 	—  	  	
Products	  	 	—  	  	 	 	—  	  	 	 	1,271	  	 	 	—  	  	  	 	(1,271	) 	 	 	—  	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total intersegment revenues	  	 	—  	  	 	 	24	  	 	 	5,904	  	 	 	—  	  	  	 	(5,928	) 	 	 	—  	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Investment income	  	 	38	  	 	 	7	  	 	 	—  	  	 	 	16	  	  	 	69	  	 	 	130	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total revenues	  	 	11,392	  	 	 	1,830	  	 	 	5,973	  	 	 	27	  	  	 	(5,859	) 	 	 	13,363	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Operating expenses:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Benefits	  	 	9,777	  	 	 	1,341	  	 	 	—  	  	 	 	22	  	  	 	(244	) 	 	 	10,896	  	
Operating costs	  	 	1,241	  	 	 	426	  	 	 	5,659	  	 	 	3	  	  	 	(5,641	) 	 	 	1,688	  	
Depreciation and amortization	  	 	49	  	 	 	24	  	 	 	30	  	 	 	—  	  	  	 	(19	) 	 	 	84	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total operating expenses	  	 	11,067	  	 	 	1,791	  	 	 	5,689	  	 	 	25	  	  	 	(5,904	) 	 	 	12,668	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Income from operations	  	 	325	  	 	 	39	  	 	 	284	  	 	 	2	  	  	 	45	  	 	 	695	  	
Interest expense	  	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	47	  	 	 	47	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Income (loss) before income taxes	  	$	325	  	 	$	39	  	 	$	284	  	 	$	2	  	  	$	(2	) 	 	$	648	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Benefit ratio	  	 	86.1	% 	 	 	82.4	% 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	83.9	% 	
Operating cost ratio	  	 	10.9	% 	 	 	23.4	% 	 	 	94.7	% 	 	 	 	 	  	 	 	 	 	 	12.8	% 	
 
S-5

Humana Inc.
3Q14 Segment Financial Information (Recast) (C)
In millions

 	  	 	 	 	 	 	 	Healthcare	 	 	Other	 	  	Eliminations/	 	 	 	 	
 	  	Retail	 	 	Group	 	 	Services	 	 	Businesses	 	  	Corporate	 	 	Consolidated	 	
Revenues—external customers	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Premiums:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Individual Medicare Advantage	  	$	6,448	  	 	$	—  	  	 	$	—  	  	 	$	—  	  	  	$	—  	  	 	$	6,448	  	
Group Medicare Advantage	  	 	1,381	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	1,381	  	
Medicare stand-alone PDP	  	 	806	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	806	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total Medicare	  	 	8,635	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	8,635	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Fully-insured	  	 	926	  	 	 	1,335	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	2,261	  	
Specialty	  	 	67	  	 	 	274	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	341	  	
Medicaid and other (A)	  	 	352	  	 	 	5	  	 	 	—  	  	 	 	13	  	  	 	—  	  	 	 	370	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total premiums	  	 	9,980	  	 	 	1,614	  	 	 	—  	  	 	 	13	  	  	 	—  	  	 	 	11,607	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Services revenue:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Provider	  	 	—  	  	 	 	6	  	 	 	320	  	 	 	—  	  	  	 	—  	  	 	 	326	  	
ASO and other (B)	  	 	10	  	 	 	172	  	 	 	—  	  	 	 	2	  	  	 	—  	  	 	 	184	  	
Pharmacy	  	 	—  	  	 	 	—  	  	 	 	26	  	 	 	—  	  	  	 	—  	  	 	 	26	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total services revenue	  	 	10	  	 	 	178	  	 	 	346	  	 	 	2	  	  	 	—  	  	 	 	536	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total revenues—external customers	  	 	9,990	  	 	 	1,792	  	 	 	346	  	 	 	15	  	  	 	—  	  	 	 	12,143	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Intersegment revenues	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Services	  	 	—  	  	 	 	22	  	 	 	3,879	  	 	 	—  	  	  	 	(3,901	) 	 	 	—  	  	
Products	  	 	—  	  	 	 	—  	  	 	 	968	  	 	 	—  	  	  	 	(968	) 	 	 	—  	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total intersegment revenues	  	 	—  	  	 	 	22	  	 	 	4,847	  	 	 	—  	  	  	 	(4,869	) 	 	 	—  	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Investment income	  	 	24	  	 	 	6	  	 	 	—  	  	 	 	15	  	  	 	50	  	 	 	95	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total revenues	  	 	10,014	  	 	 	1,820	  	 	 	5,193	  	 	 	30	  	  	 	(4,819	) 	 	 	12,238	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Operating expenses:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Benefits	  	 	8,469	  	 	 	1,324	  	 	 	—  	  	 	 	24	  	  	 	(151	) 	 	 	9,666	  	
Operating costs	  	 	1,156	  	 	 	468	  	 	 	4,953	  	 	 	5	  	  	 	(4,684	) 	 	 	1,898	  	
Depreciation and amortization	  	 	43	  	 	 	27	  	 	 	37	  	 	 	—  	  	  	 	(22	) 	 	 	85	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total operating expenses	  	 	9,668	  	 	 	1,819	  	 	 	4,990	  	 	 	29	  	  	 	(4,857	) 	 	 	11,649	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Income from operations	  	 	346	  	 	 	1	  	 	 	203	  	 	 	1	  	  	 	38	  	 	 	589	  	
Interest expense	  	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	38	  	 	 	38	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Income before income taxes	  	$	346	  	 	$	1	  	 	$	203	  	 	$	1	  	  	$	—  	  	 	$	551	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Benefit ratio	  	 	84.9	% 	 	 	82.0	% 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	83.3	% 	
Operating cost ratio	  	 	11.6	% 	 	 	25.8	% 	 	 	95.4	% 	 	 	 	 	  	 	 	 	 	 	15.6	% 	
 
S-6

Humana Inc.
YTD 3Q15 Segment Financial Information
In millions

 	  	 	 	 	 	 	 	Healthcare	 	 	Other	 	  	Eliminations/	 	 	 	 	
 	  	Retail	 	 	Group	 	 	Services	 	 	Businesses	 	  	Corporate	 	 	Consolidated	 	
Revenues—external customers	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Premiums:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Individual Medicare Advantage	  	$	22,183	  	 	$	—  	  	 	$	—  	  	 	$	—  	  	  	$	—  	  	 	$	22,183	  	
Group Medicare Advantage	  	 	4,188	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	4,188	  	
Medicare stand-alone PDP	  	 	2,915	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	2,915	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total Medicare	  	 	29,286	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	29,286	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Fully-insured	  	 	3,263	  	 	 	4,125	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	7,388	  	
Specialty	  	 	195	  	 	 	795	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	990	  	
Medicaid and other (A)	  	 	1,742	  	 	 	16	  	 	 	—  	  	 	 	25	  	  	 	—  	  	 	 	1,783	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total premiums	  	 	34,486	  	 	 	4,936	  	 	 	—  	  	 	 	25	  	  	 	—  	  	 	 	39,447	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Services revenue:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Provider	  	 	—  	  	 	 	29	  	 	 	590	  	 	 	—  	  	  	 	—  	  	 	 	619	  	
ASO and other (B)	  	 	7	  	 	 	485	  	 	 	—  	  	 	 	10	  	  	 	—  	  	 	 	502	  	
Pharmacy	  	 	—  	  	 	 	—  	  	 	 	22	  	 	 	—  	  	  	 	—  	  	 	 	22	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total services revenue	  	 	7	  	 	 	514	  	 	 	612	  	 	 	10	  	  	 	—  	  	 	 	1,143	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total revenues—external customers	  	 	34,493	  	 	 	5,450	  	 	 	612	  	 	 	35	  	  	 	—  	  	 	 	40,590	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Intersegment revenues	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Services	  	 	—  	  	 	 	68	  	 	 	13,561	  	 	 	—  	  	  	 	(13,629	) 	 	 	—  	  	
Products	  	 	—  	  	 	 	—  	  	 	 	3,654	  	 	 	—  	  	  	 	(3,654	) 	 	 	—  	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total intersegment revenues	  	 	—  	  	 	 	68	  	 	 	17,215	  	 	 	—  	  	  	 	(17,283	) 	 	 	—  	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Investment income	  	 	96	  	 	 	18	  	 	 	—  	  	 	 	53	  	  	 	171	  	 	 	338	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total revenues	  	 	34,589	  	 	 	5,536	  	 	 	17,827	  	 	 	88	  	  	 	(17,112	) 	 	 	40,928	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Operating expenses:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Benefits	  	 	29,781	  	 	 	3,908	  	 	 	—  	  	 	 	66	  	  	 	(602	) 	 	 	33,153	  	
Operating costs	  	 	3,708	  	 	 	1,323	  	 	 	16,978	  	 	 	10	  	  	 	(16,569	) 	 	 	5,450	  	
Depreciation and amortization	  	 	140	  	 	 	69	  	 	 	112	  	 	 	—  	  	  	 	(54	) 	 	 	267	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total operating expenses	  	 	33,629	  	 	 	5,300	  	 	 	17,090	  	 	 	76	  	  	 	(17,225	) 	 	 	38,870	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Income from operations	  	 	960	  	 	 	236	  	 	 	737	  	 	 	12	  	  	 	113	  	 	 	2,058	  	
Gain on sale of business	  	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	267	  	 	 	267	  	
Interest expense	  	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	140	  	 	 	140	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Income before income taxes	  	$	960	  	 	$	236	  	 	$	737	  	 	$	12	  	  	$	240	  	 	$	2,185	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Benefit ratio	  	 	86.4	% 	 	 	79.2	% 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	84.0	% 	
Operating cost ratio	  	 	10.8	% 	 	 	24.0	% 	 	 	95.2	% 	 	 	 	 	  	 	 	 	 	 	13.4	% 	
 
S-7

Humana Inc.
YTD 3Q14 Segment Financial Information (C)
In millions

 	  	 	 	 	 	 	 	Healthcare	 	 	Other	 	  	Eliminations/	 	 	 	 	
 	  	Retail	 	 	Group	 	 	Services	 	 	Businesses	 	  	Corporate	 	 	Consolidated	 	
Revenues—external customers	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Premiums:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Individual Medicare Advantage	  	$	19,375	  	 	$	—  	  	 	$	—  	  	 	$	—  	  	  	$	—  	  	 	$	19,375	  	
Group Medicare Advantage	  	 	4,131	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	4,131	  	
Medicare stand-alone PDP	  	 	2,612	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	2,612	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total Medicare	  	 	26,118	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	26,118	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Fully-insured	  	 	2,363	  	 	 	3,985	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	6,348	  	
Specialty	  	 	192	  	 	 	824	  	 	 	—  	  	 	 	—  	  	  	 	—  	  	 	 	1,016	  	
Medicaid and other (A)	  	 	735	  	 	 	15	  	 	 	—  	  	 	 	42	  	  	 	—  	  	 	 	792	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total premiums	  	 	29,408	  	 	 	4,824	  	 	 	—  	  	 	 	42	  	  	 	—  	  	 	 	34,274	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Services revenue:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Provider	  	 	—  	  	 	 	17	  	 	 	951	  	 	 	—  	  	  	 	—  	  	 	 	968	  	
ASO and other (B)	  	 	37	  	 	 	535	  	 	 	—  	  	 	 	8	  	  	 	—  	  	 	 	580	  	
Pharmacy	  	 	—  	  	 	 	—  	  	 	 	72	  	 	 	—  	  	  	 	—  	  	 	 	72	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total services revenue	  	 	37	  	 	 	552	  	 	 	1,023	  	 	 	8	  	  	 	—  	  	 	 	1,620	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total revenues—external customers	  	 	29,445	  	 	 	5,376	  	 	 	1,023	  	 	 	50	  	  	 	—  	  	 	 	35,894	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Intersegment revenues	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Services	  	 	—  	  	 	 	57	  	 	 	11,084	  	 	 	—  	  	  	 	(11,141	) 	 	 	—  	  	
Products	  	 	—  	  	 	 	—  	  	 	 	2,752	  	 	 	—  	  	  	 	(2,752	) 	 	 	—  	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total intersegment revenues	  	 	—  	  	 	 	57	  	 	 	13,836	  	 	 	—  	  	  	 	(13,893	) 	 	 	—  	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Investment income	  	 	71	  	 	 	17	  	 	 	—  	  	 	 	45	  	  	 	145	  	 	 	278	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total revenues	  	 	29,516	  	 	 	5,450	  	 	 	14,859	  	 	 	95	  	  	 	(13,748	) 	 	 	36,172	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Operating expenses:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Benefits	  	 	25,044	  	 	 	3,753	  	 	 	—  	  	 	 	73	  	  	 	(453	) 	 	 	28,417	  	
Operating costs	  	 	3,237	  	 	 	1,445	  	 	 	14,157	  	 	 	14	  	  	 	(13,335	) 	 	 	5,518	  	
Depreciation and amortization	  	 	120	  	 	 	77	  	 	 	108	  	 	 	2	  	  	 	(61	) 	 	 	246	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total operating expenses	  	 	28,401	  	 	 	5,275	  	 	 	14,265	  	 	 	89	  	  	 	(13,849	) 	 	 	34,181	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Income from operations	  	 	1,115	  	 	 	175	  	 	 	594	  	 	 	6	  	  	 	101	  	 	 	1,991	  	
Interest expense	  	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	  	 	108	  	 	 	108	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Income (loss) before income taxes	  	$	1,115	  	 	$	175	  	 	$	594	  	 	$	6	  	  	$	(7	) 	 	$	1,883	  	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Benefit ratio	  	 	85.2	% 	 	 	77.8	% 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	82.9	% 	
Operating cost ratio	  	 	11.0	% 	 	 	26.6	% 	 	 	95.3	% 	 	 	 	 	  	 	 	 	 	 	15.4	% 	
 
S-8

Humana Inc.
Consolidated Balance Sheets
Dollars in millions, except share amounts

 	  	September 30,	 	 	December 31,	 	 	YTD Change	 	
 	  	2015	 	 	2014	 	 	Dollar	 	  	Percent	 	
Assets	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Current assets:	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Cash and cash equivalents	  	$	1,597	  	 	$	1,935	  	 	 	 	 	  	 	 	 	
Investment securities	  	 	7,423	  	 	 	7,598	  	 	 	 	 	  	 	 	 	
Receivables, net	  	 	986	  	 	 	1,053	  	 	 	 	 	  	 	 	 	
Other current assets	  	 	5,767	  	 	 	4,007	  	 	 	 	 	  	 	 	 	
Assets held-for-sale	  	 	—  	  	 	 	943	  	 	 	 	 	  	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total current assets	  	 	15,773	  	 	 	15,536	  	 	$	237	  	  	 	1.5	% 	
Property and equipment, net	  	 	1,343	  	 	 	1,228	  	 	 	 	 	  	 	 	 	
Long-term investment securities	  	 	1,879	  	 	 	1,949	  	 	 	 	 	  	 	 	 	
Goodwill	  	 	3,266	  	 	 	3,231	  	 	 	 	 	  	 	 	 	
Other long-term assets	  	 	2,035	  	 	 	1,583	  	 	 	 	 	  	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total assets	  	$	24,296	  	 	$	23,527	  	 	$	769	  	  	 	3.3	% 	
 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Liabilities and Stockholders’ Equity	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Current liabilities:	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Benefits payable	  	$	4,922	  	 	$	4,475	  	 	 	 	 	  	 	 	 	
Trade accounts payable and accrued expenses	  	 	2,216	  	 	 	2,095	  	 	 	 	 	  	 	 	 	
Book overdraft	  	 	296	  	 	 	334	  	 	 	 	 	  	 	 	 	
Unearned revenues	  	 	297	  	 	 	361	  	 	 	 	 	  	 	 	 	
Short-term borrowings	  	 	11	  	 	 	—  	  	 	 	 	 	  	 	 	 	
Liabilities held-for-sale	  	 	—  	  	 	 	206	  	 	 	 	 	  	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total current liabilities	  	 	7,742	  	 	 	7,471	  	 	$	271	  	  	 	3.6	% 	
Long-term debt	  	 	3,822	  	 	 	3,825	  	 	 	 	 	  	 	 	 	
Future policy benefits payable	  	 	2,154	  	 	 	2,349	  	 	 	 	 	  	 	 	 	
Other long-term liabilities	  	 	225	  	 	 	236	  	 	 	 	 	  	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total liabilities	  	 	13,943	  	 	 	13,881	  	 	$	62	  	  	 	0.4	% 	
 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Commitments and contingencies	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Stockholders’ equity:	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Preferred stock, $1 par; 10,000,000 shares authorized, none issued	  	 	—  	  	 	 	—  	  	 	 	 	 	  	 	 	 	
Common stock, $0.16 2/3 par; 300,000,000 shares authorized; 198,350,100 issued at September 30, 2015	  	 	33	  	 	 	33	  	 	 	 	 	  	 	 	 	
Capital in excess of par value	  	 	2,515	  	 	 	2,330	  	 	 	 	 	  	 	 	 	
Retained earnings	  	 	10,960	  	 	 	9,916	  	 	 	 	 	  	 	 	 	
Accumulated other comprehensive income	  	 	137	  	 	 	223	  	 	 	 	 	  	 	 	 	
Treasury stock, at cost, 50,126,173 shares at September 30, 2015	  	 	(3,292	) 	 	 	(2,856	) 	 	 	 	 	  	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total stockholders’ equity	  	 	10,353	  	 	 	9,646	  	 	$	707	  	  	 	7.3	% 	
 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total liabilities and stockholders’ equity	  	$	24,296	  	 	$	23,527	  	 	$	769	  	  	 	3.3	% 	
 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Debt-to-total capitalization ratio	  	 	27.0	% 	 	 	28.4	% 	 	 	 	 	  	 	 	 	
Return on Invested Capital (ROIC) based on Net Operating Profit After Tax (NOPAT)—trailing 12 months	  	 	10.2	% 	 	 	10.0	% 	 	 	 	 	  	 	 	 	
 
S-9

Humana Inc.
Consolidated Statements of Cash Flows
Dollars in millions

 	  	Three Months Ended September 30,	 	 	Dollar
Change	 	 	Percentage
Change	 	 	
 	  	2015	 	 	2014	 	 	 	 	 	 	 	 	
Cash flows from operating activities	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	$	314	  	 	$	290	  	 	 	 	 	 	 	 	 	 	
Adjustments to reconcile net income to net cash provided by operating activities:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Depreciation	  	 	85	  	 	 	83	  	 	 	 	 	 	 	 	 	 	
Other intangible amortization	  	 	22	  	 	 	29	  	 	 	 	 	 	 	 	 	 	
Net realized capital gains	  	 	(51	) 	 	 	(6	) 	 	 	 	 	 	 	 	 	 	
Stock-based compensation	  	 	23	  	 	 	21	  	 	 	 	 	 	 	 	 	 	
Provision for deferred income taxes	  	 	41	  	 	 	9	  	 	 	 	 	 	 	 	 	 	
Changes in operating assets and liabilities, net of effect of businesses acquired and dispositions:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Receivables	  	 	1,143	  	 	 	1,069	  	 	 	 	 	 	 	 	 	 	
Other assets	  	 	357	  	 	 	(46	) 	 	 	 	 	 	 	 	 	 	
Benefits payable	  	 	141	  	 	 	(102	) 	 	 	 	 	 	 	 	 	 	
Other liabilities	  	 	(1,063	) 	 	 	(403	) 	 	 	 	 	 	 	 	 	 	
Unearned revenues	  	 	6	  	 	 	(2	) 	 	 	 	 	 	 	 	 	 	
Other, net	  	 	14	  	 	 	12	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash provided by operating activities	  	 	1,032	  	 	 	954	  	 	$	78	  	 	 	8.2	% 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash flows from investing activities	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Purchases of property and equipment	  	 	(125	) 	 	 	(145	) 	 	 	 	 	 	 	 	 	 	
Purchases of investment securities	  	 	(2,624	) 	 	 	(981	) 	 	 	 	 	 	 	 	 	 	
Maturities of investment securities	  	 	266	  	 	 	190	  	 	 	 	 	 	 	 	 	 	
Proceeds from sales of investment securities	  	 	1,878	  	 	 	164	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash used in investing activities	  	 	(605	) 	 	 	(772	) 	 	$	167	  	 	 	21.6	% 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash flows from financing activities	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Receipts (withdrawals) from contract deposits, net	  	 	(725	) 	 	 	(616	) 	 	 	 	 	 	 	 	 	 	
Proceeds from issuance of senior notes, net	  	 	—  	  	 	 	1,733	  	 	 	 	 	 	 	 	 	 	
Repayments from issuance of commercial paper, net	  	 	(290	) 	 	 	—  	  	 	 	 	 	 	 	 	 	 	
Change in book overdraft	  	 	(13	) 	 	 	(27	) 	 	 	 	 	 	 	 	 	 	
Common stock repurchases	  	 	(9	) 	 	 	(118	) 	 	 	 	 	 	 	 	 	 	
Excess tax benefit from stock-based compensation	  	 	1	  	 	 	1	  	 	 	 	 	 	 	 	 	 	
Dividends paid	  	 	(43	) 	 	 	(43	) 	 	 	 	 	 	 	 	 	 	
Proceeds from stock option exercises and other	  	 	(1	) 	 	 	—  	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash (used in) provided by financing activities	  	 	(1,080	) 	 	 	930	  	 	$	(2,010	) 	 	 	-216.1	% 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
(Decrease) increase in cash and cash equivalents	  	 	(653	) 	 	 	1,112	  	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents at beginning of period	  	 	2,250	  	 	 	1,593	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents at end of period	  	$	1,597	  	 	$	2,705	  	 	 	 	 	 	 	 	 	 	

S-10

Humana Inc.
Consolidated Statements of Cash Flows
Dollars in millions

 	  	Nine Months Ended September 30,	 	 	Dollar
Change	 	 	Percentage
Change	 	 	
 	  	2015	 	 	2014	 	 	 	 	 	 	 	 	
Cash flows from operating activities	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	$	1,175	  	 	$	1,002	  	 	 	 	 	 	 	 	 	 	
Adjustments to reconcile net income to net cash provided by operating activities:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gain on sale of business	  	 	(267	) 	 	 	—  	  	 	 	 	 	 	 	 	 	 	
Depreciation	  	 	263	  	 	 	240	  	 	 	 	 	 	 	 	 	 	
Other intangible amortization	  	 	72	  	 	 	85	  	 	 	 	 	 	 	 	 	 	
Net realized capital gains	  	 	(88	) 	 	 	(9	) 	 	 	 	 	 	 	 	 	 	
Stock-based compensation	  	 	92	  	 	 	76	  	 	 	 	 	 	 	 	 	 	
Provision (benefit) for deferred income taxes	  	 	13	  	 	 	(30	) 	 	 	 	 	 	 	 	 	 	
Changes in operating assets and liabilities, net of effect of businesses acquired and dispositions:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Receivables	  	 	56	  	 	 	(68	) 	 	 	 	 	 	 	 	 	 	
Other assets	  	 	(1,080	) 	 	 	(960	) 	 	 	 	 	 	 	 	 	 	
Benefits payable	  	 	447	  	 	 	783	  	 	 	 	 	 	 	 	 	 	
Other liabilities	  	 	(140	) 	 	 	238	  	 	 	 	 	 	 	 	 	 	
Unearned revenues	  	 	(64	) 	 	 	40	  	 	 	 	 	 	 	 	 	 	
Other, net	  	 	52	  	 	 	28	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash provided by operating activities	  	 	531	  	 	 	1,425	  	 	$	(894	) 	 	 	-62.7	% 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash flows from investing activities	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Proceeds from sale of business	  	 	1,055	  	 	 	72	  	 	 	 	 	 	 	 	 	 	
Acquisitions, net of cash acquired	  	 	(38	) 	 	 	(3	) 	 	 	 	 	 	 	 	 	 	
Purchases of property and equipment	  	 	(384	) 	 	 	(361	) 	 	 	 	 	 	 	 	 	 	
Purchases of investment securities	  	 	(4,345	) 	 	 	(1,949	) 	 	 	 	 	 	 	 	 	 	
Maturities of investment securities	  	 	881	  	 	 	702	  	 	 	 	 	 	 	 	 	 	
Proceeds from sales of investment securities	  	 	3,448	  	 	 	1,171	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash provided by (used in) investing activities	  	 	617	  	 	 	(368	) 	 	$	985	  	 	 	267.7	% 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash flows from financing activities	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Receipts (withdrawals) from contract deposits, net	  	 	(984	) 	 	 	(743	) 	 	 	 	 	 	 	 	 	 	
Proceeds from issuance of senior notes, net	  	 	—  	  	 	 	1,733	  	 	 	 	 	 	 	 	 	 	
Proceeds from issuance of commercial paper, net	  	 	10	  	 	 	—  	  	 	 	 	 	 	 	 	 	 	
Change in book overdraft	  	 	(38	) 	 	 	(136	) 	 	 	 	 	 	 	 	 	 	
Common stock repurchases	  	 	(380	) 	 	 	(270	) 	 	 	 	 	 	 	 	 	 	
Excess tax benefit from stock-based compensation	  	 	15	  	 	 	10	  	 	 	 	 	 	 	 	 	 	
Dividends paid	  	 	(129	) 	 	 	(129	) 	 	 	 	 	 	 	 	 	 	
Proceeds from stock option exercises and other	  	 	20	  	 	 	45	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash (used in) provided by financing activities	  	 	(1,486	) 	 	 	510	  	 	$	(1,996	) 	 	 	-391.4	% 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
(Decrease) increase in cash and cash equivalents	  	 	(338	) 	 	 	1,567	  	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents at beginning of period	  	 	1,935	  	 	 	1,138	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents at end of period	  	$	1,597	  	 	$	2,705	  	 	 	 	 	 	 	 	 	 	

S-11

Humana Inc.
Key Income Statement Ratios and Segment Operating Results
Dollars in millions

 	  	Three Months Ended September 30,	 	 	Difference	 	 	Percentage
Change	 	 	Nine Months Ended September 30,	 	 	Difference	 	 	Percentage
Change	 	 	
 	  	2015	 	 	2014	 	 	 	 	 	 	 	 	2015	 	 	2014	 	 	 	 	 	 	 	 	 	 	 	 	 	
Benefit ratio	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	  	 	86.1	% 	 	 	84.9	% 	 	 	1.2	% 	 	 	 	 	 	 	86.4	% 	 	 	85.2	% 	 	 	1.2	% 	 	 	 	 	 	 	 	 	 	 	
Group	  	 	82.4	% 	 	 	82.0	% 	 	 	0.4	% 	 	 	 	 	 	 	79.2	% 	 	 	77.8	% 	 	 	1.4	% 	 	 	 	 	 	 	 	 	 	 	
Consolidated	  	 	83.9	% 	 	 	83.3	% 	 	 	0.6	% 	 	 	 	 	 	 	84.0	% 	 	 	82.9	% 	 	 	1.1	% 	 	 	 	 	 	 	 	 	 	 	
Operating cost ratio	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	  	 	10.9	% 	 	 	11.6	% 	 	 	-0.7	% 	 	 	 	 	 	 	10.8	% 	 	 	11.0	% 	 	 	-0.2	% 	 	 	 	 	 	 	 	 	 	 	
Group	  	 	23.4	% 	 	 	25.8	% 	 	 	-2.4	% 	 	 	 	 	 	 	24.0	% 	 	 	26.6	% 	 	 	-2.6	% 	 	 	 	 	 	 	 	 	 	 	
Healthcare Services	  	 	94.7	% 	 	 	95.4	% 	 	 	-0.7	% 	 	 	 	 	 	 	95.2	% 	 	 	95.3	% 	 	 	-0.1	% 	 	 	 	 	 	 	 	 	 	 	
Consolidated	  	 	12.8	% 	 	 	15.6	% 	 	 	-2.8	% 	 	 	 	 	 	 	13.4	% 	 	 	15.4	% 	 	 	-2.0	% 	 	 	 	 	 	 	 	 	 	 	
Detail of pretax income	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	  	$	325	  	 	$	346	  	 	$	(21	) 	 	 	-6.1	% 	 	$	960	  	 	$	1,115	  	 	$	(155	) 	 	 	-13.9	% 	 	 	 	 	 	 	
Group	  	$	39	  	 	$	1	  	 	$	38	  	 	 	3800.0	% 	 	$	236	  	 	$	175	  	 	$	61	  	 	 	34.9	% 	 	 	 	 	 	 	
Healthcare Services	  	$	284	  	 	$	203	  	 	$	81	  	 	 	39.9	% 	 	$	737	  	 	$	594	  	 	$	143	  	 	 	24.1	% 	 	 	 	 	 	 	
Consolidated	  	$	648	  	 	$	551	  	 	$	97	  	 	 	17.6	% 	 	$	2,185	  	 	$	1,883	  	 	$	302	  	 	 	16.0	% 	 	 	 	 	 	 	
 
S-12

Humana Inc.
Healthcare Services Segment Metrics

 	  	Quarter Ended	 	  	Quarter Ended	 	  	 	 	 	 	 	 	Quarter Ended	 	  	 	 	  	 	 	
 	  	September 30, 2015	 	  	September 30, 2014	 	  	Difference	 	 	 	 	 	June 30, 2015	 	  	Difference	 	  	 	 	
Primary Care Providers:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	
Shared Risk (D)	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	
Owned / JV	  	 	1,700	  	  	 	2,700	  	  	 	(1,000	) 	 	 	-37.0	% 	 	 	1,600	  	  	 	100	  	  	 	6.3	% 	
Contracted	  	 	15,300	  	  	 	10,600	  	  	 	4,700	  	 	 	44.3	% 	 	 	15,100	  	  	 	200	  	  	 	1.3	% 	
Path to Risk (E)	  	 	27,200	  	  	 	25,200	  	  	 	2,000	  	 	 	7.9	% 	 	 	26,300	  	  	 	900	  	  	 	3.4	% 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	
Total Value-based	  	 	44,200	  	  	 	38,500	  	  	 	5,700	  	 	 	14.8	% 	 	 	43,000	  	  	 	1,200	  	  	 	2.8	% 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	
Medicare Care Management Professionals:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	
Employed (F)	  	 	6,500	  	  	 	5,500	  	  	 	1,000	  	 	 	18.2	% 	 	 	6,200	  	  	 	300	  	  	 	4.8	% 	
Contracted (G)	  	 	12,500	  	  	 	12,200	  	  	 	300	  	 	 	2.5	% 	 	 	11,900	  	  	 	600	  	  	 	5.0	% 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	19,000	  	  	 	17,700	  	  	 	1,300	  	 	 	7.3	% 	 	 	18,100	  	  	 	900	  	  	 	5.0	% 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	
Care Management Statistics:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	
Number of Medicare Advantage members with complex chronic conditions in Humana Chronic Care Program	  	 	548,000	  	  	 	379,900	  	  	 	168,100	  	 	 	44.2	% 	 	 	512,000	  	  	 	36,000	  	  	 	7.0	% 	
Number of high-risk discharges enrolled in Humana Transitions Program (H)	  	 	55,900	  	  	 	39,700	  	  	 	16,200	  	 	 	40.8	% 	 	 	55,900	  	  	 	—  	  	  	 	0.0	% 	
 
S-13

Humana Inc.
Healthcare Services Segment Metrics (Continued)
Script volume in thousands

 	 	Quarter Ended	 	 	Quarter Ended	 	 	Year-over-Year	 	 	 	 	 	Quarter Ended	 	 	Sequential	 	 	 	 	
 	 	September 30, 2015	 	 	September 30, 2014	 	 	Difference	 	 	 	 	 	June 30, 2015	 	 	Difference	 	 	 	 	
Pharmacy:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Generic Dispense Rate	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	 	 	89.9	% 	 	 	88.7	% 	 	 	1.2	% 	 	 	 	 	 	 	89.7	% 	 	 	0.2	% 	 	 	 	 	
Group	 	 	83.0	% 	 	 	81.3	% 	 	 	1.7	% 	 	 	 	 	 	 	83.0	% 	 	 	0.0	% 	 	 	 	 	
Total	 	 	89.5	% 	 	 	88.3	% 	 	 	1.2	% 	 	 	 	 	 	 	89.3	% 	 	 	0.2	% 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Mail-Order Penetration	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	 	 	26.2	% 	 	 	24.0	% 	 	 	2.2	% 	 	 	 	 	 	 	25.7	% 	 	 	0.5	% 	 	 	 	 	
Group	 	 	8.8	% 	 	 	9.3	% 	 	 	-0.5	% 	 	 	 	 	 	 	8.6	% 	 	 	0.2	% 	 	 	 	 	
Total	 	 	25.2	% 	 	 	23.1	% 	 	 	2.1	% 	 	 	 	 	 	 	24.8	% 	 	 	0.4	% 	 	 	 	 	

 	 	 	 	 	 	 	 	Difference	 	 	Percentage
Change	 	 	 	 	 	Difference	 	 	Percentage
Change	 	
Script volume (I)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	 	 	95,500	  	 	 	78,200	  	 	 	17,300	  	 	 	22.1	% 	 	 	93,200	  	 	 	2,300	  	 	 	2.5	% 	
Group	 	 	5,100	  	 	 	5,300	  	 	 	(200	) 	 	 	-3.8	% 	 	 	5,200	  	 	 	(100	) 	 	 	-1.9	% 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	 	 	100,600	  	 	 	83,500	  	 	 	17,100	  	 	 	20.5	% 	 	 	98,400	  	 	 	2,200	  	 	 	2.2	% 	

S-14

Humana Inc.
Healthcare Services Segment Metrics (Continued)
Script volume in thousands

 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	  	Nine months ended
September 30, 2015	 	 	Nine months ended
September 30, 2014	 	 	Year-over-Year
Difference	 	 	 	 	
Pharmacy:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Generic Dispense Rate	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	  	 	89.7	% 	 	 	88.5	% 	 	 	1.2	% 	 	 	 	 	
Group	  	 	83.0	% 	 	 	81.0	% 	 	 	2.0	% 	 	 	 	 	
Total	  	 	89.4	% 	 	 	88.0	% 	 	 	1.4	% 	 	 	 	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Mail-Order Penetration	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	  	 	25.9	% 	 	 	24.1	% 	 	 	1.8	% 	 	 	 	 	
Group	  	 	8.6	% 	 	 	9.3	% 	 	 	-0.7	% 	 	 	 	 	
Total	  	 	24.9	% 	 	 	23.1	% 	 	 	1.8	% 	 	 	 	 	

 	  	 	 	 	 	 	 	Difference	 	 	Percentage
Change	 	
Script volume (I)	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	  	 	279,700	  	 	 	228,000	  	 	 	51,700	  	 	 	22.7	% 	
Group	  	 	15,400	  	 	 	15,700	  	 	 	(300	) 	 	 	-1.9	% 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	 	295,100	  	 	 	243,700	  	 	 	51,400	  	 	 	21.1	% 	

S-15

Humana Inc.
Ending Membership Detail
In thousands

 	 	 	 	 	Average
3Q15	 	 	 	 	 	Year-over-Year Change	 	 	 	 	 	YTD Change	 	 	
 	 	September 30, 2015	 	 	 	 	 	September 30, 2014	 	 	Amount	 	 	Percent	 	 	December 31, 2014	 	 	Amount	 	 	Percent	 	 	 	 	
Medical Membership:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Individual Medicare Advantage	 	 	2,737.1	  	 	 	2,729.0	  	 	 	2,402.8	  	 	 	334.3	  	 	 	13.9	% 	 	 	2,427.9	  	 	 	309.2	  	 	 	12.7	% 	 	 	 	
Group Medicare Advantage	 	 	481.3	  	 	 	479.7	  	 	 	484.9	  	 	 	(3.6	) 	 	 	-0.7	% 	 	 	489.7	  	 	 	(8.4	) 	 	 	-1.7	% 	 	 	 	
Medicare stand-alone PDPs	 	 	4,509.6	  	 	 	4,488.1	  	 	 	3,940.8	  	 	 	568.8	  	 	 	14.4	% 	 	 	3,994.0	  	 	 	515.6	  	 	 	12.9	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Medicare	 	 	7,728.0	  	 	 	7,696.8	  	 	 	6,828.5	  	 	 	899.5	  	 	 	13.2	% 	 	 	6,911.6	  	 	 	816.4	  	 	 	11.8	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Individual commercial	 	 	963.7	  	 	 	978.6	  	 	 	1,085.8	  	 	 	(122.1	) 	 	 	-11.2	% 	 	 	1,016.2	  	 	 	(52.5	) 	 	 	-5.2	% 	 	 	 	
State-based Medicaid (J)	 	 	368.4	  	 	 	365.8	  	 	 	296.3	  	 	 	72.1	  	 	 	24.3	% 	 	 	316.8	  	 	 	51.6	  	 	 	16.3	% 	 	 	 	
Medicare Supplement	 	 	157.1	  	 	 	156.4	  	 	 	129.2	  	 	 	27.9	  	 	 	21.6	% 	 	 	131.9	  	 	 	25.2	  	 	 	19.1	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Retail	 	 	9,217.2	  	 	 	9,197.6	  	 	 	8,339.8	  	 	 	877.4	  	 	 	10.5	% 	 	 	8,376.5	  	 	 	840.7	  	 	 	10.0	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Group	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Fully-insured medical commercial	 	 	1,167.4	  	 	 	1,173.4	  	 	 	1,212.3	  	 	 	(44.9	) 	 	 	-3.7	% 	 	 	1,235.5	  	 	 	(68.1	) 	 	 	-5.5	% 	 	 	 	
ASO commercial	 	 	709.8	  	 	 	728.4	  	 	 	1,111.9	  	 	 	(402.1	) 	 	 	-36.2	% 	 	 	1,104.3	  	 	 	(394.5	) 	 	 	-35.7	% 	 	 	 	
Military services	 	 	3,082.7	  	 	 	3,076.9	  	 	 	3,085.6	  	 	 	(2.9	) 	 	 	-0.1	% 	 	 	3,090.4	  	 	 	(7.7	) 	 	 	-0.2	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Group	 	 	4,959.9	  	 	 	4,978.7	  	 	 	5,409.8	  	 	 	(449.9	) 	 	 	-8.3	% 	 	 	5,430.2	  	 	 	(470.3	) 	 	 	-8.7	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other Businesses	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Long-term care and other	 	 	33.0	  	 	 	33.2	  	 	 	36.0	  	 	 	(3.0	) 	 	 	-8.3	% 	 	 	35.0	  	 	 	(2.0	) 	 	 	-5.7	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Other Businesses	 	 	33.0	  	 	 	33.2	  	 	 	36.0	  	 	 	(3.0	) 	 	 	-8.3	% 	 	 	35.0	  	 	 	(2.0	) 	 	 	-5.7	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Medical Membership	 	 	14,210.1	  	 	 	14,209.5	  	 	 	13,785.6	  	 	 	424.5	  	 	 	3.1	% 	 	 	13,841.7	  	 	 	368.4	  	 	 	2.7	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Detail of Individual commercial	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
ACA compliant:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
On-Exchange	 	 	609.6	  	 	 	620.6	  	 	 	601.4	  	 	 	8.2	  	 	 	1.4	% 	 	 	554.8	  	 	 	54.8	  	 	 	9.9	% 	 	 	 	
Off-Exchange	 	 	204.8	  	 	 	206.0	  	 	 	126.4	  	 	 	78.4	  	 	 	62.0	% 	 	 	131.5	  	 	 	73.3	  	 	 	55.7	% 	 	 	 	
Non-ACA compliant (legacy)	 	 	149.3	  	 	 	152.0	  	 	 	358.0	  	 	 	(208.7	) 	 	 	-58.3	% 	 	 	329.9	  	 	 	(180.6	) 	 	 	-54.7	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total individual commercial	 	 	963.7	  	 	 	978.6	  	 	 	1,085.8	  	 	 	(122.1	) 	 	 	-11.2	% 	 	 	1,016.2	  	 	 	(52.5	) 	 	 	-5.2	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Specialty Membership:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retail	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Dental—fully-insured	 	 	873.9	  	 	 	880.2	  	 	 	876.4	  	 	 	(2.5	) 	 	 	-0.3	% 	 	 	828.5	  	 	 	45.4	  	 	 	5.5	% 	 	 	 	
Vision	 	 	199.3	  	 	 	199.6	  	 	 	209.0	  	 	 	(9.7	) 	 	 	-4.6	% 	 	 	208.4	  	 	 	(9.1	) 	 	 	-4.4	% 	 	 	 	
Other supplemental benefits (K)	 	 	114.1	  	 	 	116.0	  	 	 	134.1	  	 	 	(20.0	) 	 	 	-14.9	% 	 	 	128.9	  	 	 	(14.8	) 	 	 	-11.5	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Retail	 	 	1,187.3	  	 	 	1,195.8	  	 	 	1,219.5	  	 	 	(32.2	) 	 	 	-2.6	% 	 	 	1,165.8	  	 	 	21.5	  	 	 	1.8	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Group	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Dental—fully-insured	 	 	2,204.1	  	 	 	2,220.1	  	 	 	2,379.7	  	 	 	(175.6	) 	 	 	-7.4	% 	 	 	2,370.5	  	 	 	(166.4	) 	 	 	-7.0	% 	 	 	 	
Dental—ASO	 	 	764.6	  	 	 	755.1	  	 	 	783.7	  	 	 	(19.1	) 	 	 	-2.4	% 	 	 	772.4	  	 	 	(7.8	) 	 	 	-1.0	% 	 	 	 	
Vision	 	 	1,978.6	  	 	 	1,983.1	  	 	 	2,074.7	  	 	 	(96.1	) 	 	 	-4.6	% 	 	 	2,103.3	  	 	 	(124.7	) 	 	 	-5.9	% 	 	 	 	
Other supplemental benefits (K)	 	 	1,143.4	  	 	 	1,151.4	  	 	 	1,287.2	  	 	 	(143.8	) 	 	 	-11.2	% 	 	 	1,256.5	  	 	 	(113.1	) 	 	 	-9.0	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Group	 	 	6,090.7	  	 	 	6,109.7	  	 	 	6,525.3	  	 	 	(434.6	) 	 	 	-6.7	% 	 	 	6,502.7	  	 	 	(412.0	) 	 	 	-6.3	% 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Specialty Membership	 	 	7,278.0	  	 	 	7,305.5	  	 	 	7,744.8	  	 	 	(466.8	) 	 	 	-6.0	% 	 	 	7,668.5	  	 	 	(390.5	) 	 	 	-5.1	% 	 	 	 	

S-16

Humana Inc.
Premiums and Services Revenue Detail
Dollars in millions, except per member per month

 	  	Three Months Ended September 30,	 	  	Dollar
Change	 	 	Percentage
Change	 	 	Per Member per Month (L)
Three Months Ended September 30,	 	 	
 	  	2015	 	  	2014	 	  	 	 	 	 	 	 	2015	 	  	2014	 	 	 	 	 	 	 	
Premiums and Services Revenue	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Retail:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Individual Medicare Advantage	  	$	7,316	  	  	$	6,448	  	  	$	868	  	 	 	13.5	% 	 	$	894	  	  	$	898	  	 	 	 	 	 	 	
Group Medicare Advantage	  	 	1,396	  	  	 	1,381	  	  	 	15	  	 	 	1.1	% 	 	 	970	  	  	 	953	  	 	 	 	 	 	 	
Medicare stand-alone PDPs	  	 	927	  	  	 	806	  	  	 	121	  	 	 	15.0	% 	 	 	69	  	  	 	68	  	 	 	 	 	 	 	
Individual commercial	  	 	978	  	  	 	863	  	  	 	115	  	 	 	13.3	% 	 	 	333	  	  	 	262	  	 	 	 	 	 	 	
State-based Medicaid (J)	  	 	592	  	  	 	352	  	  	 	240	  	 	 	68.2	% 	 	 	539	  	  	 	468	  	 	 	 	 	 	 	
Medicare Supplemental	  	 	78	  	  	 	63	  	  	 	15	  	 	 	23.8	% 	 	 	166	  	  	 	165	  	 	 	 	 	 	 	
Specialty	  	 	66	  	  	 	67	  	  	 	(1	) 	 	 	-1.5	% 	 	 	18	  	  	 	18	  	 	 	 	 	 	 	
Other services	  	 	1	  	  	 	10	  	  	 	(9	) 	 	 	-90.0	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Total Retail	  	 	11,354	  	  	 	9,990	  	  	 	1,364	  	 	 	13.7	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Group:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Fully-insured medical commercial	  	 	1,362	  	  	 	1,335	  	  	 	27	  	 	 	2.0	% 	 	 	387	  	  	 	367	  	 	 	 	 	 	 	
Specialty	  	 	260	  	  	 	274	  	  	 	(14	) 	 	 	-5.1	% 	 	 	16	  	  	 	16	  	 	 	 	 	 	 	
Commercial ASO & other services (B)	  	 	104	  	  	 	114	  	  	 	(10	) 	 	 	-8.8	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Military services (M)	  	 	97	  	  	 	91	  	  	 	6	  	 	 	6.6	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Total Group	  	 	1,823	  	  	 	1,814	  	  	 	9	  	 	 	0.5	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Healthcare Services:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Pharmacy solutions	  	 	5,229	  	  	 	4,373	  	  	 	856	  	 	 	19.6	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Provider services	  	 	428	  	  	 	583	  	  	 	(155	) 	 	 	-26.6	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Home based services	  	 	263	  	  	 	184	  	  	 	79	  	 	 	42.9	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Clinical programs	  	 	53	  	  	 	53	  	  	 	—  	  	 	 	0.0	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Total Healthcare Services	  	 	5,973	  	  	 	5,193	  	  	 	780	  	 	 	15.0	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	

S-17

Humana Inc.
Premiums and Services Revenue Detail
Dollars in millions, except per member per month

 	  	Nine Months Ended September 30,	 	  	Dollar
Change	 	 	Percentage
Change	 	 	Per Member per Month (L)
Nine Months Ended September 30,	 	 	
 	  	2015	 	  	2014	 	  	 	 	 	 	 	 	2015	 	  	2014	 	 	 	 	 	 	 	
Premiums and Services Revenue	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Retail:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Individual Medicare Advantage	  	$	22,183	  	  	$	19,375	  	  	$	2,808	  	 	 	14.5	% 	 	$	912	  	  	$	914	  	 	 	 	 	 	 	
Group Medicare Advantage	  	 	4,188	  	  	 	4,131	  	  	 	57	  	 	 	1.4	% 	 	 	982	  	  	 	958	  	 	 	 	 	 	 	
Medicare stand-alone PDPs	  	 	2,915	  	  	 	2,612	  	  	 	303	  	 	 	11.6	% 	 	 	73	  	  	 	75	  	 	 	 	 	 	 	
Individual commercial	  	 	3,038	  	  	 	2,183	  	  	 	855	  	 	 	39.2	% 	 	 	332	  	  	 	262	  	 	 	 	 	 	 	
State-based Medicaid (J)	  	 	1,742	  	  	 	735	  	  	 	1,007	  	 	 	137.0	% 	 	 	555	  	  	 	474	  	 	 	 	 	 	 	
Medicare Supplemental	  	 	225	  	  	 	180	  	  	 	45	  	 	 	25.0	% 	 	 	164	  	  	 	163	  	 	 	 	 	 	 	
Specialty	  	 	195	  	  	 	192	  	  	 	3	  	 	 	1.6	% 	 	 	18	  	  	 	18	  	 	 	 	 	 	 	
Other services	  	 	7	  	  	 	37	  	  	 	(30	) 	 	 	-81.1	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Total Retail	  	 	34,493	  	  	 	29,445	  	  	 	5,048	  	 	 	17.1	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Group:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Fully-insured medical commercial	  	 	4,125	  	  	 	3,985	  	  	 	140	  	 	 	3.5	% 	 	 	387	  	  	 	367	  	 	 	 	 	 	 	
Specialty	  	 	795	  	  	 	824	  	  	 	(29	) 	 	 	-3.5	% 	 	 	16	  	  	 	16	  	 	 	 	 	 	 	
Commercial ASO & other services (B)	  	 	302	  	  	 	327	  	  	 	(25	) 	 	 	-7.6	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Military services (M)	  	 	296	  	  	 	297	  	  	 	(1	) 	 	 	-0.3	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Total Group	  	 	5,518	  	  	 	5,433	  	  	 	85	  	 	 	1.6	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Healthcare Services:	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Pharmacy solutions	  	 	15,280	  	  	 	12,480	  	  	 	2,800	  	 	 	22.4	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Provider services	  	 	1,659	  	  	 	1,737	  	  	 	(78	) 	 	 	-4.5	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Home based services	  	 	736	  	  	 	488	  	  	 	248	  	 	 	50.8	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Clinical programs	  	 	152	  	  	 	154	  	  	 	(2	) 	 	 	-1.3	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
Total Healthcare Services	  	 	17,827	  	  	 	14,859	  	  	 	2,968	  	 	 	20.0	% 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	

S-18

Humana Inc.
Medicare Summary
Premiums in millions, except per member per month
Membership in thousands

 	 	Three Months Ended September 30,	 	 	Year-over-year Change	 	 	Per Member per Month (L)
Three Months Ended September 30,	 	
 	 	2015	 	 	2014	 	 	Amount	 	 	Percent	 	 	2015	 	 	2014	 	
Premiums	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Medicare Advantage	 	$	8,712	  	 	$	7,829	  	 	$	883	  	 	 	11.3	% 	 	$	905	  	 	$	907	  	
Medicare stand-alone PDPs	 	 	927	  	 	 	806	  	 	 	121	  	 	 	15.0	% 	 	 	69	  	 	 	68	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Medicare	 	$	9,639	  	 	$	8,635	  	 	$	1,004	  	 	 	11.6	% 	 	 	 	 	 	 	 	 	

 	 	Nine Months Ended September 30,	 	 	Year-over-year Change	 	 	Per Member per Month (L)
Nine Months Ended September 30,	 	
 	 	2015	 	 	2014	 	 	Amount	 	 	Percent	 	 	2015	 	 	2014	 	
Premiums	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Medicare Advantage	 	$	26,371	  	 	$	23,506	  	 	$	2,865	  	 	 	12.2	% 	 	$	922	  	 	$	921	  	
Medicare stand-alone PDPs	 	 	2,915	  	 	 	2,612	  	 	 	303	  	 	 	11.6	% 	 	 	73	  	 	 	75	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Medicare	 	$	29,286	  	 	$	26,118	  	 	$	3,168	  	 	 	12.1	% 	 	 	 	 	 	 	 	 	

 	 	 	 	 	Year-over-year Change	 	 	 	 	
 	 	September 30, 2015	 	 	September 30, 2014	 	 	Amount	 	 	Percent	 	 	 	 	 	 	 	
Fully-Insured Membership	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Medicare Advantage	 	 	3,218.4	  	 	 	2,887.7	  	 	 	330.7	  	 	 	11.5	% 	 	 	 	 	 	 	 	 	
Medicare stand-alone PDPs	 	 	4,509.6	  	 	 	3,940.8	  	 	 	568.8	  	 	 	14.4	% 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Medicare	 	 	7,728.0	  	 	 	6,828.5	  	 	 	899.5	  	 	 	13.2	% 	 	 	 	 	 	 	 	 	

 	 	 	 	 	Member Mix	 	 	 	 	
 	 	September 30, 2015	 	 	September 30, 2014	 	 	September 30,
2015	 	 	September 30,
2014	 	 	 	 	 	 	 	
Individual Medicare Advantage Membership	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
HMO	 	 	1,551.8	  	 	 	1,287.8	  	 	 	56.7	% 	 	 	53.6	% 	 	 	 	 	 	 	 	 	
PPO	 	 	1,185.3	  	 	 	1,115.0	  	 	 	43.3	% 	 	 	46.4	% 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Individual Medicare Advantage	 	 	2,737.1	  	 	 	2,402.8	  	 	 	100.0	% 	 	 	100.0	% 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Individual Medicare Advantage Membership	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Shared Risk (D)	 	 	860.5	  	 	 	689.9	  	 	 	31.4	% 	 	 	28.7	% 	 	 	 	 	 	 	 	 	
Path to Risk (E)	 	 	745.6	  	 	 	583.2	  	 	 	27.2	% 	 	 	24.3	% 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Value-based	 	 	1,606.1	  	 	 	1,273.1	  	 	 	58.6	% 	 	 	53.0	% 	 	 	 	 	 	 	 	 	
Other	 	 	1,131.0	  	 	 	1,129.7	  	 	 	41.4	% 	 	 	47.0	% 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Individual Medicare Advantage	 	 	2,737.1	  	 	 	2,402.8	  	 	 	100.0	% 	 	 	100.0	% 	 	 	 	 	 	 	 	 	

S-19

Humana Inc.
Investments
Dollars in millions

 	  	Fair value	 	
 	  	9/30/2015	 	  	6/30/2015	 	  	12/31/2014	 	
Investment Portfolio:	  	 	 	 	  	 	 	 	  	 	 	 	
Cash & cash equivalents	  	$	1,597	  	  	$	2,250	  	  	$	1,935	  	
Investment securities	  	 	7,423	  	  	 	7,041	  	  	 	7,598	  	
Long-term investment securities	  	 	1,879	  	  	 	1,839	  	  	 	1,949	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Total investment portfolio	  	$	10,899	  	  	$	11,130	  	  	$	11,482	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Duration (N)	  	 	4.27	  	  	 	4.19	  	  	 	4.14	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Average Credit Rating	  	 	AA-	  	  	 	AA-	  	  	 	AA-	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Investment Portfolio Detail:	  	 	 	 	  	 	 	 	  	 	 	 	
Cash and cash equivalents	  	$	1,597	  	  	$	2,250	  	  	$	1,935	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
U.S. Government and agency obligations	  	 	 	 	  	 	 	 	  	 	 	 	
U.S. Treasury and agency obligations	  	 	328	  	  	 	337	  	  	 	374	  	
U.S. Government residential mortgage-backed	  	 	1,550	  	  	 	1,344	  	  	 	1,477	  	
U.S. Government commercial mortgage-backed	  	 	17	  	  	 	18	  	  	 	21	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Total U.S. Government and agency obligations	  	 	1,895	  	  	 	1,699	  	  	 	1,872	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Tax-exempt municipal securities	  	 	 	 	  	 	 	 	  	 	 	 	
Pre-refunded	  	 	251	  	  	 	181	  	  	 	199	  	
Insured	  	 	250	  	  	 	453	  	  	 	484	  	
Other	  	 	2,245	  	  	 	2,002	  	  	 	2,376	  	
Auction rate securities	  	 	5	  	  	 	5	  	  	 	9	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Total tax-exempt municipal securities	  	 	2,751	  	  	 	2,641	  	  	 	3,068	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Residential mortgage-backed	  	 	13	  	  	 	14	  	  	 	17	  	
Commercial mortgage-backed	  	 	1,031	  	  	 	944	  	  	 	843	  	
Asset-backed securities	  	 	273	  	  	 	163	  	  	 	29	  	
Corporate securities	  	 	 	 	  	 	 	 	  	 	 	 	
Financial services	  	 	835	  	  	 	793	  	  	 	772	  	
Other	  	 	2,504	  	  	 	2,626	  	  	 	2,946	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Total corporate securities	  	 	3,339	  	  	 	3,419	  	  	 	3,718	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Total investment portfolio	  	$	10,899	  	  	$	11,130	  	  	$	11,482	  	

S-20

Humana Inc.
Detail of Benefits Payable Balance and Year-to-Date Changes
Dollars in millions

 	 	September 30,
2015	 	 	June 30,
2015	 	 	March 31,
2015	 	 	December 31,
2014	 	 	September 30,
2014	 	 	June 30,
2014	 	 	March 31,
2014	 	
Detail of benefits payable	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
IBNR (O)	 	$	3,667	  	 	$	3,376	  	 	$	3,398	  	 	$	3,254	  	 	$	3,412	  	 	$	3,242	  	 	$	2,940	  	
Reported Claims in Process (P)	 	 	576	  	 	 	522	  	 	 	553	  	 	 	475	  	 	 	476	  	 	 	635	  	 	 	545	  	
Other Benefits Payable (Q)	 	 	679	  	 	 	883	  	 	 	813	  	 	 	746	  	 	 	788	  	 	 	901	  	 	 	947	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total Benefits Payable	 	$	4,922	  	 	$	4,781	  	 	$	4,764	  	 	$	4,475	  	 	$	4,676	  	 	$	4,778	  	 	$	4,432	  	

 	 	Nine Months Ended
September 30, 2015	 	 	Nine Months Ended
September 30, 2014	 	 	Year Ended
December 31, 2014	 	 	 	 	 	 	 	 	 	 	 	 	 	
Year-to-date changes in benefits payable, excluding military services (R)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balances at January 1	 	$	4,475	  	 	$	3,893	  	 	$	3,893	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Less: Reinsurance recoverables (S)	 	 	(78	) 	 	 	—  	  	 	 	—  	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balances at January 1, net	 	 	4,397	  	 	 	3,893	  	 	 	3,893	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Incurred related to:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current year	 	 	33,482	  	 	 	28,827	  	 	 	38,641	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Prior years (T)	 	 	(245	) 	 	 	(440	) 	 	 	(518	) 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total incurred	 	 	33,237	  	 	 	28,387	  	 	 	38,123	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Paid related to:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current year	 	 	(28,828	) 	 	 	(24,399	) 	 	 	(34,357	) 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Prior years	 	 	(3,982	) 	 	 	(3,270	) 	 	 	(3,262	) 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total paid	 	 	(32,810	) 	 	 	(27,669	) 	 	 	(37,619	) 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Reinsurance recoverables (S)	 	 	98	  	 	 	65	  	 	 	78	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balances at end of period	 	$	4,922	  	 	$	4,676	  	 	$	4,475	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	

 	 	Nine Months Ended
September 30, 2015	 	 	Nine Months Ended
September 30, 2014	 	 	Year Ended
December 31, 2014	 	 	 	 	 	 	 	 	 	 	 	 	 	
Summary of Consolidated Benefit Expense:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total benefit expense incurred, per above	 	$	33,237	  	 	$	28,387	  	 	$	38,123	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Military services benefit expense	 	 	9	  	 	 	7	  	 	 	11	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Future policy benefit expense (U)	 	 	(93	) 	 	 	23	  	 	 	32	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Consolidated Benefit Expense	 	$	33,153	  	 	$	28,417	  	 	$	38,166	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	

S-21

Humana Inc.
Benefits Payable Statistics (V)
Receipt Cycle Time (W)

 	  	2015	 	  	2014	 	  	Change	 	  	Percentage
Change	 	
1st Quarter Average	  	 	13.9	  	  	 	13.6	  	  	 	0.3	  	  	 	2.2	% 	
2nd Quarter Average	  	 	14.0	  	  	 	13.5	  	  	 	0.5	  	  	 	3.7	% 	
3rd Quarter Average	  	 	13.8	  	  	 	13.4	  	  	 	0.4	  	  	 	3.0	% 	
4th Quarter Average	  	 	n/a	  	  	 	13.5	  	  	 	n/a	  	  	 	n/a	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Full Year Average	  	 	13.9	  	  	 	13.5	  	  	 	0.4	  	  	 	3.0	% 	
 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Unprocessed Claims Inventories (X)

Date	  	Estimated Valuation
(millions)	 	  	Number of Days
on Hand	 	
3/31/2014	  	$	688	  	  	 	6.9	  	
6/30/2014	  	$	817	  	  	 	7.3	  	
9/30/2014	  	$	823	  	  	 	7.1	  	
12/31/2014	  	$	782	  	  	 	6.4	  	
3/31/2015	  	$	862	  	  	 	6.7	  	
6/30/2015	  	$	779	  	  	 	5.6	  	
 	  	 	 	 	  	 	 	 	
9/30/2015	  	$	920	  	  	 	6.8	  	

S-22

Humana Inc.
Benefits Payable Statistics (Continued) (V)
Days in Claims Payable (Y)

Quarter Ended	  	Days in Claims
Payable (DCP)	 	  	Change Last
4 Quarters	 	  	Percentage
Change	 	
9/30/2013	  	 	49.5	  	  	 	(2.1	) 	  	 	-4.1	% 	
12/31/2013	  	 	47.8	  	  	 	(0.7	) 	  	 	-1.4	% 	
3/31/2014	  	 	47.7	  	  	 	(1.3	) 	  	 	-2.7	% 	
6/30/2014	  	 	48.7	  	  	 	(2.0	) 	  	 	-3.9	% 	
9/30/2014	  	 	46.6	  	  	 	(2.9	) 	  	 	-5.9	% 	
12/31/2014	  	 	43.5	  	  	 	(4.3	) 	  	 	-9.0	% 	
3/31/2015	  	 	42.8	  	  	 	(4.9	) 	  	 	-10.3	% 	
6/30/2015	  	 	41.1	  	  	 	(7.6	) 	  	 	-15.6	% 	
 	  	 	 	 	  	 	 	 	  	 	 	 	
9/30/2015	  	 	43.4	  	  	 	(3.2	) 	  	 	-6.9	% 	
 	  	 	 	 	  	 	 	 	  	 	 	 	
Change in Days in Claims Payable (Z)

 	  	1Q
2015	 	 	2Q
2015	 	 	3Q
2015	 	 	YTD 3Q
2015	 	 	YTD 3Q
2014	 	 	FY
2014	 	
DCP—beginning of period	  	 	43.5	  	 	 	42.8	  	 	 	41.1	  	 	 	43.5	  	 	 	47.8	  	 	 	47.8	  	
Components of change in DCP:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Change in unprocessed claims inventories	  	 	0.7	  	 	 	(0.7	) 	 	 	1.2	  	 	 	1.2	  	 	 	2.0	  	 	 	1.5	  	
Change in processed claims inventories	  	 	0.2	  	 	 	—  	  	 	 	0.4	  	 	 	0.6	  	 	 	0.7	  	 	 	0.4	  	
Change in pharmacy payment cutoff	  	 	0.2	  	 	 	(0.1	) 	 	 	—  	  	 	 	0.1	  	 	 	0.1	  	 	 	—  	  	
Change in capitation/provider settlements	  	 	(0.4	) 	 	 	0.9	  	 	 	(1.0	) 	 	 	(0.5	) 	 	 	(3.2	) 	 	 	(3.8	) 	
All other (AA)	  	 	(1.4	) 	 	 	(1.8	) 	 	 	1.7	  	 	 	(1.5	) 	 	 	(0.8	) 	 	 	(2.4	) 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
DCP—end of period	  	 	42.8	  	 	 	41.1	  	 	 	43.4	  	 	 	43.4	  	 	 	46.6	  	 	 	43.5	  	

S-23

Items Expected to Significantly Impact 2016 Humana Inc. Earnings

Items Expected to Pressure Earnings Growth in 2016	 	Items Expected to Facilitate Earnings Growth in 2016	
Individual commercial business:
 
•    Deterioration in claims experience during 3Q 2015, which if it continues, would reduce the likelihood of achieving the level of profitability the company had previously anticipated for this business in 2016
 
•    Reduction in reliance on premium stabilization programs
 
The company continues to evaluate its participation in this line of business for 2017.	 	Medicare businesses:
 
•    Repositioning of 2016 plan designs for Medicare Advantage
 
•    On a percentage basis, individual Medicare Advantage net membership growth in line with the overall market; expected growth in the mid to upper single digits (excludes approximately 35k-member loss associated with a product discontinuance in Puerto Rico)	
 	 	
Healthcare Services segment:
 
•    Slower growth due to individual Medicare Advantage membership growth in line with the overall market (versus outsized growth in prior years)
 
•    Impact on the company’s provider businesses of 2016 risk coding recalibration
 
•    Loss of Concentra earnings due to June 2015 sale of that business	 	Individual commercial business:
 
•    Premium increases for 2016 including the impact of early 2015 claims experience and June 2015 updated risk adjustment data from CMS
 
•    Products to be discontinued and market exits; no market expansions
 
•    Impacts approximately 100k members, though approximately 88% of those will have other Humana options from which they can choose in addition to offerings in the open market
 
•    Primarily focuses on off-exchange, platinum metal-tier and broad-network products both on and off exchange
 
•    Offerings to be discontinued in 2016 account for a significant portion of the 2015 pretax losses for the individual commercial business
 
•    Network improvements, enhancements to claims and clinical processes and administrative cost right-sizing	
 	 	
Medicare businesses:
 
•    Continued evaluation of potential impact from financial recovery process changes made during 2014
 
•    Loss of 145k-member profitable group Medicare Advantage account due to movement to private exchange	 	State-based contracts business:
 
•    Full-year effect of rate increases and operational improvements implemented in 2015	
 	 	
Operating expenses and investment income:
 
•    Higher consolidated operating expenses as reductions implemented in 2015 are expected to return to normal levels in 2016
 
•    Lower investment income due to completion of 2015 portfolio repositioning	 	 	
 	 	
Share repurchase:
 
•    Lack of share repurchase for full year 2016 versus active repurchase program in first half of 2015	 	 	
 
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Humana Inc.
Footnotes to Statistical Schedules and Supplementary Information
3Q 2015 Earnings Release
 
(A)	The Medicaid and other category include the company’s Medicaid and military services businesses as well as the closed block of long-term care insurance policies.	
(B)	The ASO and other category is primarily comprised of ASO fees and other ancillary services fees.	
(C)	On January 1, 2015, the company realigned certain of its businesses among its financial reporting segments to correspond with internal management reporting changes and renamed its Employer Group segment the Group segment. The company’s three reportable segments remain Retail, Group, and Healthcare Services.	
(D)	In certain circumstances, the company contracts with providers to accept financial risk for a defined set of Medicare Advantage membership. In transferring this risk, the company prepays these providers a monthly fixed-fee per member to coordinate substantially all of the medical care for their Medicare Advantage members assigned or attributed to their provider panel, including some health benefit administrative functions and claims processing. For these capitated Shared Risk arrangements, the company generally agrees to payment rates that target a benefit expense ratio. The result is a high level of engagement on the part of the provider.	
(E)	A Path to Risk provider is one who has a high level of engagement and participates in one of Humana’s pay-for-performance programs (Model Practice or Medical Home) or has a risk contract in place with a trigger (future date or membership threshold) which has not yet been met. In addition to earning incentives, these providers may also have a shared savings component by which they can share in achieved surpluses when the actual cost of the medical services provided to patients assigned or attributed to their panel is less than the agreed upon medical expense target.	
(F)	Based on full-time employee equivalent counts that include clinicians responsible for managing and coordinating member care. Excludes professionals that support the non-clinical aspects of care.	
(G)	Based on employee headcount figures that include clinicians responsible for managing and coordinating member care. Excludes professionals that support the non-clinical aspects of care.	
(H)	Includes the number of high-risk discharges enrolled in the Humana Transitions Program over the last 12 months.	
(I)	Script volume is presented on an adjusted 30-day equivalent basis.	
(J)	Includes Medicaid Temporary Assistance for Needy Families (TANF), which contracts are generally reinsured through partnering relationships, dual-eligible demonstration, and Long-Term Support Services (LTSS) from state-based contracts.	
(K)	Other supplemental benefits include life, disability, and fixed benefit products including cancer and critical illness policies.	
(L)	Computed based on average membership for the period (i.e., monthly ending membership during the period divided by the number of months in the period).	
(M)	The majority of Military services revenues are generally not contracted on a per-member basis.	
(N)	Duration is the time-weighted average of the present value of the fixed income portfolio cash flows.	
(O)	IBNR represents an estimate of benefits expense payable for claims incurred but not reported (IBNR) at the balance sheet date. The level of IBNR is primarily impacted by membership levels, medical claim trends and the receipt cycle time, which represents the length of time between when a claim is initially incurred and when the claim form is received (i.e. a shorter time span results in a lower IBNR). IBNR includes unprocessed claims inventories.	
(P)	Reported claims in process represents the estimated valuation of processed claims that are in the post-claim adjudication process, which consists of administrative functions such as audit and check batching and handling, as well as amounts owed to the company’s pharmacy benefit administrator, which fluctuate due to bi-weekly payments and the month-end cutoff.	
(Q)	Other benefits payable primarily include amounts owed to providers under capitated and risk sharing arrangements.	
(R)	The table excludes activity associated with military services benefits payable related to the previous contract that expired March 31, 2012.	
(S)	Represents reinsurance recoverables associated with the company’s state-based Medicaid contract in Kentucky.	
(T)	Amounts incurred related to prior years vary from previously estimated liabilities as the claims ultimately are settled. Negative amounts reported for incurred related to prior years result from claims being ultimately settled for amounts less than originally estimated (favorable development). There were no changes in the approach used to determine the company’s estimate of medical claim reserves during the quarter.	
(U)	Future policy benefit expense has a related liability classified as a long-term liability on the balance sheet.	
(V)	Benefits payable statistics represents fully-insured medical claims data and exclude military services claims data and specialty benefits.	
(W)	The receipt cycle time measures the average length of time between when a claim was initially incurred and when the claim form was received. Receipt cycle time data for the company’s largest claim processing platforms represent approximately 99% of the company’s fully-insured medical claims volume. Pharmacy and specialty claims, including dental, vision and other supplemental benefits are excluded from this measurement.	
(X)	Unprocessed claim inventories, included in IBNR, represent fully-insured medical claims which have not been adjudicated and completely processed. These claims can be received but not entered into the claims system, pended for further review prior to final processing, or held due to prepay edits. Number of days on hand represents the estimated unprocessed inventory value divided by the average processed dollars per day for the quarter. Prior period days on hand have been recast to calculate based on claim valuations in lieu of claim counts previously presented.	
(Y)	A common metric for monitoring benefits payable levels relative to the benefit expense is days in claims payable, or DCP, which represents the benefits payable at the end of the period divided by average benefits expense per day in the quarterly period. This metric excludes military services, Medicare stand-alone PDPs, and reinsurance expense related to commercial individual and long duration products.	
(Z)	DCP fluctuates due to a number of factors, the more significant of which are detailed in this roll forward. Growth in certain product lines can also impact DCP for the quarter since a provision for claims would not have been recorded for members that had not yet enrolled earlier in the quarter, yet those members would have a provision and corresponding medical claims reserve recorded upon enrollment later in the quarter. This metric excludes military services, Medicare stand-alone PDPs, and reinsurance expense relate to commercial individual and long-duration products.	
(AA)	The “All Other” component in the DCP rollforward primarily includes items related to claim payment processes, the impact of pharmacy costs, and other expenses that impact benefits expense differently than the liability. Changes in claim payment-processes would primarily include (1) gradual implementation during 2014 of inpatient authorization review prior to admission as opposed to post adjudication and (2) changes in certain components of claim payment cycle time.	
 
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