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Supplemental Condensed Consolidating Financial Information | 3 Months Ended
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Mar. 31, 2017
Condensed Financial Information [Abstract] |
Supplemental Condensed Consolidating Financial Information | Supplemental Condensed Consolidating Financial Information The 5.375% Notes described in Note 7, “Debt,” are fully and unconditionally guaranteed by certain of our 100% owned subsidiaries on a joint and several basis, with certain exceptions considered customary for such guarantees. The 5.375% Notes and the guarantees are effectively subordinated to all of our and our guarantors’ existing and future secured debt to the extent of the assets securing such debt. In addition, the 5.375% Notes and the guarantees are structurally subordinated to all indebtedness and other liabilities and preferred stock, if any, of our subsidiaries that do not guarantee the 5.375% Notes. As discussed in Note 7, “Debt,” the First Amendment to the Credit Facility provided that all guarantors immediately prior to January 3, 2017, other than Molina Information Systems, LLC, d/b/a Molina Medicaid Solutions, Molina Pathways, LLC, and Pathways Health and Community Support LLC, were automatically and unconditionally released from their obligations as guarantors under the Credit Facility and the 5.375% Notes. The following condensed consolidating financial statements present Molina Healthcare, Inc. (as parent guarantor), the subsidiary guarantors, the subsidiary non-guarantors and eliminations, according to the guarantor structure as assessed at the most recent balance sheet date, March 31, 2017. CONDENSED CONSOLIDATING STATEMENTS OF INCOME
| Three Months Ended March 31, 2017
| Parent Guarantor |  | Other Guarantors |  | Non-Guarantors |  | Eliminations |  | Consolidated
| (In millions)
Revenue: |  |  |  |  |  |  |  |  |
Total revenue | $ | 341 |  |  | $ | 48 |  |  | $ | 4,857 |  |  | $ | (342 | ) |  | $ | 4,904 |
Expenses: |  |  |  |  |  |  |  |  |
Medical care costs | 4 |  |  | — |  |  | 4,107 |  |  | — |  |  | 4,111 |
Cost of service revenue | — |  |  | 42 |  |  | 80 |  |  | — |  |  | 122 |
General and administrative expenses | 297 |  |  | 7 |  |  | 477 |  |  | (342 | ) |  | 439 |
Premium tax expenses | — |  |  | — |  |  | 111 |  |  | — |  |  | 111 |
Depreciation and amortization | 27 |  |  | — |  |  | 12 |  |  | — |  |  | 39 |
Total operating expenses | 328 |  |  | 49 |  |  | 4,787 |  |  | (342 | ) |  | 4,822 |
Operating income (loss) | 13 |  |  | (1 | ) |  | 70 |  |  | — |  |  | 82 |
Interest expense | 26 |  |  | — |  |  | — |  |  | — |  |  | 26 |
Other income, net | (75 | ) |  | — |  |  | — |  |  | — |  |  | (75 | )
Income (loss) before income taxes | 62 |  |  | (1 | ) |  | 70 |  |  | — |  |  | 131 |
Income tax expense | 31 |  |  | — |  |  | 23 |  |  | — |  |  | 54 |
Net income (loss) before equity in earnings of subsidiaries | 31 |  |  | (1 | ) |  | 47 |  |  | — |  |  | 77 |
Equity in net earnings of subsidiaries | 46 |  |  | (2 | ) |  | — |  |  | (44 | ) |  | — |
Net income (loss) | $ | 77 |  |  | $ | (3 | ) |  | $ | 47 |  |  | $ | (44 | ) |  | $ | 77 |
| Three Months Ended March 31, 2016
| Parent Guarantor |  | Other Guarantors |  | Non-Guarantors |  | Eliminations |  | Consolidated
| (In millions)
Revenue: |  |  |  |  |  |  |  |  |
Total revenue | $ | 251 |  |  | $ | 52 |  |  | $ | 4,290 |  |  | $ | (250 | ) |  | $ | 4,343 |
Expenses: |  |  |  |  |  |  |  |  |
Medical care costs | 12 |  |  | — |  |  | 3,576 |  |  | — |  |  | 3,588 |
Cost of service revenue | — |  |  | 65 |  |  | 62 |  |  | — |  |  | 127 |
General and administrative expenses | 217 |  |  | (15 | ) |  | 388 |  |  | (250 | ) |  | 340 |
Premium tax expenses | — |  |  | — |  |  | 109 |  |  | — |  |  | 109 |
Health insurer fee expenses | — |  |  | — |  |  | 58 |  |  | — |  |  | 58 |
Depreciation and amortization | 22 |  |  | 2 |  |  | 8 |  |  | — |  |  | 32 |
Total operating expenses | 251 |  |  | 52 |  |  | 4,201 |  |  | (250 | ) |  | 4,254 |
Operating income | — |  |  | — |  |  | 89 |  |  | — |  |  | 89 |
Interest expense | 25 |  |  | — |  |  | — |  |  | — |  |  | 25 |
(Loss) income before income taxes | (25 | ) |  | — |  |  | 89 |  |  | — |  |  | 64 |
Income tax (benefit) expense | (16 | ) |  | — |  |  | 56 |  |  | — |  |  | 40 |
Net (loss) income before equity in earnings of subsidiaries | (9 | ) |  | — |  |  | 33 |  |  | — |  |  | 24 |
Equity in net earnings of subsidiaries | 33 |  |  | 2 |  |  | — |  |  | (35 | ) |  | — |
Net income | $ | 24 |  |  | $ | 2 |  |  | $ | 33 |  |  | $ | (35 | ) |  | $ | 24 |
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
| Three Months Ended March 31, 2017
| Parent Guarantor |  | Other Guarantors |  | Non-Guarantors |  | Eliminations |  | Consolidated
| (In millions)
Net income (loss) | $ | 77 |  |  | $ | (3 | ) |  | $ | 47 |  |  | $ | (44 | ) |  | $ | 77 |
Other comprehensive income, net of tax | 1 |  |  | — |  |  | 1 |  |  | (1 | ) |  | 1 |
Comprehensive income (loss) | $ | 78 |  |  | $ | (3 | ) |  | $ | 48 |  |  | $ | (45 | ) |  | $ | 78 |
| Three Months Ended March 31, 2016
| Parent Guarantor |  | Other Guarantors |  | Non-Guarantors |  | Eliminations |  | Consolidated
| (In millions)
Net income | $ | 24 |  |  | $ | 2 |  |  | $ | 33 |  |  | $ | (35 | ) |  | $ | 24 |
Other comprehensive income, net of tax | 6 |  |  | — |  |  | 5 |  |  | (5 | ) |  | 6 |
Comprehensive income | $ | 30 |  |  | $ | 2 |  |  | $ | 38 |  |  | $ | (40 | ) |  | $ | 30 |
CONDENSED CONSOLIDATING BALANCE SHEETS
| March 31, 2017
| Parent Guarantor |  | Other Guarantors |  | Non-Guarantors |  | Eliminations |  | Consolidated
| (In millions)
ASSETS
Current assets: |  |  |  |  |  |  |  |  |
Cash and cash equivalents | $ | 187 |  |  | $ | 19 |  |  | $ | 2,992 |  |  | $ | — |  |  | $ | 3,198 |
Investments | 86 |  |  | — |  |  | 1,970 |  |  | — |  |  | 2,056 |
Receivables | 2 |  |  | 41 |  |  | 963 |  |  | — |  |  | 1,006 |
Due from (to) affiliates | 155 |  |  | (7 | ) |  | (148 | ) |  | — |  |  | — |
Prepaid expenses and other current assets | 53 |  |  | 22 |  |  | 67 |  |  | — |  |  | 142 |
Total current assets | 483 |  |  | 75 |  |  | 5,844 |  |  | — |  |  | 6,402 |
Property, equipment, and capitalized software, net | 294 |  |  | 47 |  |  | 106 |  |  | — |  |  | 447 |
Deferred contract costs | — |  |  | 89 |  |  | — |  |  | — |  |  | 89 |
Goodwill and intangible assets, net | 56 |  |  | 72 |  |  | 623 |  |  | — |  |  | 751 |
Restricted investments | — |  |  | — |  |  | 115 |  |  | — |  |  | 115 |
Investment in subsidiaries, net | 2,722 |  |  | 244 |  |  | — |  |  | (2,966 | ) |  | — |
Deferred income taxes | 10 |  |  | — |  |  | — |  |  | — |  |  | 10 |
Derivative asset | 181 |  |  | — |  |  | — |  |  | — |  |  | 181 |
Other assets | 50 |  |  | 3 |  |  | 6 |  |  | (16 | ) |  | 43 |
| $ | 3,796 |  |  | $ | 530 |  |  | $ | 6,694 |  |  | $ | (2,982 | ) |  | $ | 8,038 |
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities: |  |  |  |  |  |  |  |  |
Medical claims and benefits payable | $ | — |  |  | $ | — |  |  | $ | 1,926 |  |  | $ | — |  |  | $ | 1,926 |
Amounts due government agencies | — |  |  | — |  |  | 1,575 |  |  | — |  |  | 1,575 |
Accounts payable and accrued liabilities | 187 |  |  | 39 |  |  | 212 |  |  | — |  |  | 438 |
Deferred revenue | — |  |  | 48 |  |  | 413 |  |  | — |  |  | 461 |
Income taxes payable | 17 |  |  | (7 | ) |  | 11 |  |  | — |  |  | 21 |
Current portion of long-term debt | 1 |  |  | — |  |  | — |  |  | — |  |  | 1 |
Total current liabilities | 205 |  |  | 80 |  |  | 4,137 |  |  | — |  |  | 4,422 |
Long-term debt | 1,653 |  |  | — |  |  | 16 |  |  | (16 | ) |  | 1,653 |
Deferred income taxes | 8 |  |  | 42 |  |  | (39 | ) |  | — |  |  | 11 |
Derivative liability | 181 |  |  | — |  |  | — |  |  | — |  |  | 181 |
Other long-term liabilities | 22 |  |  | 1 |  |  | 21 |  |  | — |  |  | 44 |
Total liabilities | 2,069 |  |  | 123 |  |  | 4,135 |  |  | (16 | ) |  | 6,311 |
Total stockholders’ equity | 1,727 |  |  | 407 |  |  | 2,559 |  |  | (2,966 | ) |  | 1,727 |
| $ | 3,796 |  |  | $ | 530 |  |  | $ | 6,694 |  |  | $ | (2,982 | ) |  | $ | 8,038 |
| December 31, 2016
| Parent Guarantor |  | Other Guarantors |  | Non-Guarantors |  | Eliminations |  | Consolidated
| (In millions)
ASSETS
Current assets: |  |  |  |  |  |  |  |  |
Cash and cash equivalents | $ | 86 |  |  | $ | 6 |  |  | $ | 2,727 |  |  | $ | — |  |  | $ | 2,819 |
Investments | 178 |  |  | — |  |  | 1,580 |  |  | — |  |  | 1,758 |
Receivables | 2 |  |  | 34 |  |  | 938 |  |  | — |  |  | 974 |
Income tax refundable | 17 |  |  | 4 |  |  | 18 |  |  | — |  |  | 39 |
Due from (to) affiliates | 104 |  |  | (5 | ) |  | (99 | ) |  | — |  |  | — |
Prepaid expenses and other current assets | 58 |  |  | 30 |  |  | 43 |  |  | — |  |  | 131 |
Derivative asset | 267 |  |  | — |  |  | — |  |  | — |  |  | 267 |
Total current assets | 712 |  |  | 69 |  |  | 5,207 |  |  | — |  |  | 5,988 |
Property, equipment, and capitalized software, net | 301 |  |  | 46 |  |  | 107 |  |  | — |  |  | 454 |
Deferred contract costs | — |  |  | 86 |  |  | — |  |  | — |  |  | 86 |
Goodwill and intangible assets, net | 58 |  |  | 73 |  |  | 629 |  |  | — |  |  | 760 |
Restricted investments | — |  |  | — |  |  | 110 |  |  | — |  |  | 110 |
Investment in subsidiaries, net | 2,609 |  |  | 246 |  |  | — |  |  | (2,855 | ) |  | — |
Deferred income taxes | 10 |  |  | — |  |  | — |  |  | — |  |  | 10 |
Other assets | 48 |  |  | 3 |  |  | 6 |  |  | (16 | ) |  | 41 |
| $ | 3,738 |  |  | $ | 523 |  |  | $ | 6,059 |  |  | $ | (2,871 | ) |  | $ | 7,449 |
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities: |  |  |  |  |  |  |  |  |
Medical claims and benefits payable | $ | 1 |  |  | $ | — |  |  | $ | 1,928 |  |  | $ | — |  |  | $ | 1,929 |
Amounts due government agencies | — |  |  | — |  |  | 1,202 |  |  | — |  |  | 1,202 |
Accounts payable and accrued liabilities | 146 |  |  | 34 |  |  | 205 |  |  | — |  |  | 385 |
Deferred revenue | — |  |  | 40 |  |  | 275 |  |  | — |  |  | 315 |
Current portion of long-term debt | 472 |  |  | — |  |  | — |  |  | — |  |  | 472 |
Derivative liability | 267 |  |  | — |  |  | — |  |  | — |  |  | 267 |
Total current liabilities | 886 |  |  | 74 |  |  | 3,610 |  |  | — |  |  | 4,570 |
Long-term debt | 1,173 |  |  | — |  |  | 16 |  |  | (16 | ) |  | 1,173 |
Deferred income taxes | 11 |  |  | 39 |  |  | (35 | ) |  | — |  |  | 15 |
Other long-term liabilities | 19 |  |  | 1 |  |  | 22 |  |  | — |  |  | 42 |
Total liabilities | 2,089 |  |  | 114 |  |  | 3,613 |  |  | (16 | ) |  | 5,800 |
Total stockholders’ equity | 1,649 |  |  | 409 |  |  | 2,446 |  |  | (2,855 | ) |  | 1,649 |
| $ | 3,738 |  |  | $ | 523 |  |  | $ | 6,059 |  |  | $ | (2,871 | ) |  | $ | 7,449 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
| Three Months Ended March 31, 2017
| Parent Guarantor |  | Other Guarantors |  | Non-Guarantors |  | Eliminations |  | Consolidated
| (In millions)
Operating activities: |  |  |  |  |  |  |  |  |
Net cash provided by operating activities | $ | 144 |  |  | $ | 21 |  |  | $ | 554 |  |  | $ | — |  |  | $ | 719 |
Investing activities: |  |  |  |  |  |  |  |  |
Purchases of investments | — |  |  | — |  |  | (733 | ) |  | — |  |  | (733 | )
Proceeds from sales and maturities of investments | 92 |  |  | — |  |  | 341 |  |  | — |  |  | 433 |
Purchases of property, equipment and capitalized software | (18 | ) |  | (5 | ) |  | (3 | ) |  | — |  |  | (26 | )
Increase in restricted investments | — |  |  | — |  |  | (7 | ) |  | — |  |  | (7 | )
Capital contributions to/from subsidiaries | (106 | ) |  | 1 |  |  | 105 |  |  | — |  |  | — |
Dividends to/from subsidiaries | 50 |  |  | — |  |  | (50 | ) |  | — |  |  | — |
Change in amounts due to/from affiliates | (60 | ) |  | 2 |  |  | 58 |  |  | — |  |  | — |
Other, net | — |  |  | (6 | ) |  | — |  |  | — |  |  | (6 | )
Net cash used in investing activities | (42 | ) |  | (8 | ) |  | (289 | ) |  | — |  |  | (339 | )
Financing activities: |  |  |  |  |  |  |  |  |
Proceeds from employee stock plans | 1 |  |  | — |  |  | — |  |  | — |  |  | 1 |
Other, net | (2 | ) |  | — |  |  | — |  |  | — |  |  | (2 | )
Net cash used in financing activities | (1 | ) |  | — |  |  | — |  |  | — |  |  | (1 | )
Net increase in cash and cash equivalents | 101 |  |  | 13 |  |  | 265 |  |  | — |  |  | 379 |
Cash and cash equivalents at beginning of period | 86 |  |  | 6 |  |  | 2,727 |  |  | — |  |  | 2,819 |
Cash and cash equivalents at end of period | $ | 187 |  |  | $ | 19 |  |  | $ | 2,992 |  |  | $ | — |  |  | $ | 3,198 |
| Three Months Ended March 31, 2016
| Parent Guarantor |  | Other Guarantors |  | Non-Guarantors |  | Eliminations |  | Consolidated
| (In millions)
Operating activities: |  |  |  |  |  |  |  |  |
Net cash (used in) provided by operating activities | $ | (38 | ) |  | $ | 23 |  |  | $ | 154 |  |  | $ | — |  |  | $ | 139 |
Investing activities: |  |  |  |  |  |  |  |  |
Purchases of investments | (35 | ) |  | — |  |  | (576 | ) |  | — |  |  | (611 | )
Proceeds from sales and maturities of investments | 10 |  |  | — |  |  | 338 |  |  | — |  |  | 348 |
Purchases of property, equipment and capitalized software | (28 | ) |  | (14 | ) |  | (4 | ) |  | — |  |  | (46 | )
Increase in restricted investments | — |  |  | — |  |  | (4 | ) |  | — |  |  | (4 | )
Net cash paid in business combinations | — |  |  | (1 | ) |  | (1 | ) |  | — |  |  | (2 | )
Capital contributions to/from subsidiaries | (36 | ) |  | 2 |  |  | 34 |  |  | — |  |  | — |
Change in amounts due to/from affiliates | 23 |  |  | (5 | ) |  | (18 | ) |  | — |  |  | — |
Other, net | 6 |  |  | (5 | ) |  | — |  |  | — |  |  | 1 |
Net cash used in investing activities | (60 | ) |  | (23 | ) |  | (231 | ) |  | — |  |  | (314 | )
Financing activities: |  |  |  |  |  |  |  |  |
Other, net | 2 |  |  | — |  |  | — |  |  | — |  |  | 2 |
Net cash provided by financing activities | 2 |  |  | — |  |  | — |  |  | — |  |  | 2 |
Net decrease in cash and cash equivalents | (96 | ) |  | — |  |  | (77 | ) |  | — |  |  | (173 | )
Cash and cash equivalents at beginning of period | 360 |  |  | 13 |  |  | 1,956 |  |  | — |  |  | 2,329 |
Cash and cash equivalents at end of period | $ | 264 |  |  | $ | 13 |  |  | $ | 1,879 |  |  | $ | — |  |  | $ | 2,156 |

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- Definition The entire disclosure for condensed financial statements. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 3 -Subparagraph (SX 210.12-04) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e24072-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=64809438&loc=d3e5614-111684 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 270 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.10-01(a)) -URI http://asc.fasb.org/extlink&oid=27015980&loc=d3e46468-122699 + Details
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