XML 33 R17.htm IDEA: XBRL DOCUMENT v3.7.0.1
Segment Information
 3 Months Ended
Mar. 31, 2017
Segment Reporting [Abstract]  
Segment Information
Segment Information
We have three reportable segments. These segments consist of our Health Plans segment, which comprises the vast majority of our operations; our Molina Medicaid Solutions segment; and our Other segment. Our reportable segments are consistent with how we currently manage the business and view the markets we serve.
Gross margin is the appropriate earnings measure for our reportable segments, based on how our chief operating decision maker currently reviews results, assesses performance, and allocates resources.
Gross margin for our Health Plans segment is referred to as “Medical margin,” and for our Molina Medicaid Solutions and Other segments, as “Service margin.” Medical margin represents the amount earned by the Health Plans segment after medical costs are deducted from premium revenue. The medical care ratio represents medical care costs as a percentage of premium revenue, and is one of the key metrics used to assess the performance of the Health Plans segment. Therefore, the underlying medical margin is the most important measure of earnings reviewed by the chief operating decision maker. The service margin is equal to service revenue minus cost of service revenue.
 
 
Health Plans
 
Molina Medicaid Solutions
 
Other
 
Consolidated
 
 
 
 
 
 
 
(In millions)
Three Months Ended March 31, 2017
 
 
 
 
 
 
 
 
Total revenue (1)
 
$
4,771

 
$
46

 
$
87

 
$
4,904

Gross margin
 
537

 
4

 
5

 
546

 
 
 
 
 
 
 
 
 
Three Months Ended March 31, 2016
 
 
 
 
 
 
 
 
Total revenue (1)
 
4,201

 
52

 
90

 
4,343

Gross margin
 
407

 
6

 
7

 
420

 
 
 
 
 
 
 
 
 
Total Assets
 
 
 
 
 
 
 
 
March 31, 2017
 
6,586

 
279

 
1,173

 
8,038

December 31, 2016
 
5,897

 
267

 
1,285

 
7,449


______________________
(1)
Total revenue consists primarily of premium revenue, premium tax revenue and health insurer fee revenue for the Health Plans segment, and service revenue for the Molina Medicaid Solutions and Other segments. Inter-segment revenue is insignificant.
The following table reconciles gross margin by segment to consolidated income before income tax expense:
 
Three Months Ended March 31,
 
2017
 
2016
 
(In millions)
Gross margin:
 
 
 
Health Plans
$
537

 
$
407

Molina Medicaid Solutions
4

 
6

Other
5

 
7

Total gross margin
546

 
420

Add: other operating revenues (1)
125

 
208

Less: other operating expenses (2)
(589
)
 
(539
)
Operating income
82

 
89

Other (income) expenses, net
(49
)
 
25

Income before income tax expense
$
131

 
$
64

______________________
(1)
Other operating revenues include premium tax revenue, health insurer fee revenue, investment income and other revenue.
(2)
Other operating expenses include general and administrative expenses, premium tax expenses, health insurer fee expenses and depreciation and amortization.