News Release

LONG BEACH, Calif.--(BUSINESS WIRE)--Feb. 8, 2016-- Molina Healthcare, Inc. (NYSE: MOH):

• Full year 2015 net income per diluted share of $2.57, up nearly 100% over 2014.
• Full year 2015 total revenue of $14.1 billion, up 46% over 2014.
• Aggregate membership up 35% over 2014.
• Excluding a contract settlement charge of $0.16 per diluted share, diluted net income per share for the fourth quarter of 2015 would have been $0.67 compared with $0.69 for the fourth quarter of 2014.

Molina Healthcare, Inc. (NYSE: MOH) today reported its financial results for the fourth quarter of 2015.

“The fourth quarter of 2015 capped off a very strong year for Molina Healthcare. Net income more than doubled compared with 2014, and we are making progress toward our goal of a 1.5% to 2% net income margin by the end of 2017,” said J. Mario Molina M.D., chief executive officer of Molina Healthcare, Inc. “The in-market ‘tuck-in’ acquisitions already announced give us strong momentum going into 2016 and complement the already strong revenue growth we experienced over the past two years. I want to thank all of our employees for a great year.”

2016 Business Outlook and Investor Meeting

As has been the Company’s past practice, it will discuss its 2016 business outlook and strategy at its Investor Day Conference webcast and presentation to be held on February 11, 2016, at the Le Parker Meridien Hotel in New York City from 12:30 p.m. to 4:30 p.m. Eastern Time. The Company will webcast the presentations offered by its management team, which will be followed by question-and-answer sessions. A 30-day online replay of the Investor Day meeting will be available approximately one hour following the conclusion of the live webcast. A link to this webcast can be found on the Company’s website at molinahealthcare.com.

Overview of 2015 Financial Results, Continuing Operations

Earnings per diluted share nearly doubled in 2015 when compared with 2014, while net income more than doubled. Substantial increases in revenue, along with improved operating efficiency, were responsible for the Company’s improved performance. The Company’s after-tax margin increased to 1.0% in 2015 from 0.6% in 2014.

Strong enrollment growth combined with a 4% increase in premium revenue per member generated over $4 billion, or 46% more premium revenue in 2015 compared with 2014.

Enrollment growth was primarily due to increased Medicaid Expansion, Marketplace and integrated Medicare-Medicaid Plan (MMP) enrollment, and the start-up of the Puerto Rico health plan in April 2015.

Medical care costs as a percent of premium revenue (the “medical care ratio”) decreased to 89.0% in 2015, from 89.5% in 2014.

General and administrative expenses as a percentage of total revenue (the “general and administrative expense ratio”) increased slightly to 8.2% in 2015, from 7.9% in 2014, primarily as a result of dramatic growth in the Company’s Marketplace membership. Excluding Marketplace broker and exchange fees from both years, the general and administrative expense ratio decreased to 7.5% in 2015 from 7.8% in 2014.

Other items affecting premium revenue in 2015 included the Affordable Care Act health insurer fee (HIF). During 2015, the Company secured full reimbursement for its expenses under the HIF. Additionally, as the Company has previously disclosed, it has been unable to recognize certain quality related revenue at its Texas health plan because it does not have historical information, clear definitions, and clarity around minimum standards. The Company recognized no such revenue in either the fourth quarter of 2015, or the year as a whole.

Fourth Quarter Developments

Fourth quarter results were favorable for the reasons explained above. The following items are included in results for the fourth quarter of 2015:

• During the quarter, the Company recorded a contract settlement charge of approximately $15 million ($0.16 per diluted share) as a result of its termination of a hospital management agreement.
• During the fourth quarter of 2015, the Company recognized approximately $6 million ($0.07 per diluted share) of interest expense related to $700 million of senior notes due 2022 issued in November.
• General and administrative expense for the fourth quarter 2015 includes approximately $3 million ($0.03 per diluted share) in transaction costs for business acquisitions.

Conference Call

The Company’s management will host a conference call and webcast to discuss its fourth quarter and year-end results at 5:00 p.m. Eastern time on Monday, February 8, 2016. The number to call for the interactive teleconference is (212) 271-4657. A telephonic replay of the conference call will be available from 7:00 p.m. Eastern time on Monday, February 8, 2016, through 6:00 p.m. on Tuesday, February 9, 2016, by dialing (800) 633-8284 and entering confirmation number 21802135. A live audio broadcast of Molina Healthcare’s conference call will be available on the Company’s website, molinahealthcare.com. A 30-day online replay will be available approximately an hour following the conclusion of the live broadcast.

About Molina Healthcare

Molina Healthcare, Inc., a FORTUNE 500 company, provides managed health care services under the Medicaid and Medicare programs and through the state insurance marketplaces. Through our locally operated health plans in 11 states across the nation and in the Commonwealth of Puerto Rico, Molina currently serves approximately 3.5 million members. Dr. C. David Molina founded our company in 1980 as a provider organization serving low-income families in Southern California. Today, we continue his mission of providing high quality and cost-effective health care to those who need it most. For more information about Molina Healthcare, please visit our website at molinahealthcare.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This earnings release contains "forward-looking statements" regarding the Company’s plans, expectations, and anticipated future events. Actual results could differ materially due to numerous known and unknown risks and uncertainties. Those known risks and uncertainties include, but are not limited, to the following:

• uncertainties and evolving market and provider economics associated with the implementation of the Affordable Care Act, the Medicaid expansion, the insurance marketplaces, the effect of various implementing regulations, and uncertainties regarding the Medicare-Medicaid dual eligible demonstration programs in California, Illinois, Michigan, Ohio, South Carolina, and Texas;
• management of our medical costs, including seasonal flu patterns and rates of utilization that are consistent with our expectations, and our ability to reduce over time the high medical costs commonly associated with new patient populations;
• federal or state medical cost expenditure floors, administrative cost and profit ceilings, premium stabilization programs, profit sharing arrangements, and conflicting interpretations thereof;
• the interpretation and implementation of at-risk premium rules regarding the achievement of certain quality measures;
• cyber-attacks or other privacy or data security incidents resulting in an inadvertent unauthorized disclosure of protected health information;
• the success of our new health plan in Puerto Rico, including the successful resolution of the Puerto Rico debt crisis and the payment of all amounts due under our Medicaid contract;
• specialty drugs or generic drugs that are exorbitantly priced but not factored into the calculation of our capitated rates;
• significant budget pressures on state governments and their potential inability to maintain current rates, to implement expected rate increases, or to maintain existing benefit packages or membership eligibility thresholds or criteria, including the resolution of the Illinois budget impasse and continued payment of our Illinois health plan;
• the accurate estimation of incurred but not reported or paid medical costs across our health plans;
• retroactive adjustments to premium revenue or accounting estimates which require adjustment based upon subsequent developments;
• efforts by states to recoup previously paid amounts;
• the success of our efforts to retain existing government contracts and to obtain new government contracts in connection with state requests for proposals (RFPs) in both existing and new states;
• the continuation and renewal of the government contracts of both our health plans and Molina Medicaid Solutions and the terms under which such contracts are renewed;
• complications, member confusion, or enrollment backlogs related to the annual renewal of Medicaid coverage;
• government audits and reviews, and any fine, enrollment freeze, or monitoring program that may result therefrom;
• changes with respect to our provider contracts and the loss of providers;
• approval by state regulators of dividends and distributions by our health plan subsidiaries;
• changes in funding under our contracts as a result of regulatory changes, programmatic adjustments, or other reforms;
• high dollar claims related to catastrophic illness;
• the favorable resolution of litigation, arbitration, or administrative proceedings;
• the relatively small number of states in which we operate health plans;
• the effect on our Los Angeles County subcontract of Centene’s acquisition of Health Net;
• the availability of adequate financing on acceptable terms to fund and capitalize our expansion and growth, repay our outstanding indebtedness at maturity and meet our liquidity needs, including the interest expense and other costs associated with such financing;
• the failure of a state in which we operate to renew its federal Medicaid waiver;
• changes generally affecting the managed care or Medicaid management information systems industries;
• increases in government surcharges, taxes, and assessments;
• newly emergent viruses or widespread epidemics, including the Zika virus, and associated public alarm;
• changes in general economic conditions, including unemployment rates;
• the sufficiency of our funds, on hand to pay the amounts due upon conversion of our outstanding notes;
• increasing competition and consolidation in the Medicaid industry;

and numerous other risk factors, including those discussed in the Company’s periodic reports and filings with the Securities and Exchange Commission. These reports can be accessed under the investor relations tab of the Company’s website or on the SEC’s website at sec.gov. Given these risks and uncertainties, we can give no assurances that the Company’s forward-looking statements will prove to be accurate, or that any other results or events projected or contemplated by the Company’s forward-looking statements will in fact occur, and we caution investors not to place undue reliance on these statements. All forward-looking statements in this release represent the Company’s judgment as of February 8, 2016, and we disclaim any obligation to update any forward-looking statements to conform the statement to actual results or changes in the Company’s expectations.

	MOLINA HEALTHCARE, INC. UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
				Three Months Ended										Year Ended
				December 31,										December 31,
				2015					2014					2015					2014
				(Dollar amounts in millions, except net income per share)
	Revenue:
	Premium revenue			$	3,488				$	2,599				$	13,140				$	9,023
	Service revenue			106					54					252					210
	Premium tax revenue			104					91					393					294
	Health insurer fee revenue			61					52					264					120
	Investment income			6					2					18					8
	Other revenue			—					4					5					12
	Total revenue			3,765					2,802					14,072					9,667
	Operating expenses:
	Medical care costs			3,110					2,322					11,691					8,076
	Cost of service revenue			90					39					193					157
	General and administrative expenses			317					205					1,147					765
	Premium tax expenses			104					91					393					294
	Health insurer fee expenses			40					23					157					89
	Depreciation and amortization			28					25					104					93
	Total operating expenses			3,689					2,705					13,685					9,474
	Operating income			76					97					387					193
	Other expenses, net:
	Interest expense			22					15					67					57
	Other (income) expense, net			(2		)			—					(2		)			1
	Total other expenses, net			20					15					65					58
	Income from continuing operations before income tax expense			56					82					322					135
	Income tax expense			26					48					179					73
	Income from continuing operations			30					34					143					62
	Net income			$	30				$	34				$	143				$	62
	Diluted net income per share: (1)
	Income from continuing operations			$	0.51				$	0.69				$	2.57				$	1.30
	Loss from discontinued operations			—					—					—					(0.01		)
	Diluted net income per share			$	0.51				$	0.69				$	2.57				$	1.29
	Diluted weighted average shares outstanding			57.7					48.9					55.6					48.3
	Operating Statistics, Continuing Operations: (1)
	Medical care ratio (2)			89.2		%			89.4		%			89.0		%			89.5		%
	Service revenue ratio (3)			84.7		%			72.6		%			76.4		%			74.6		%
	General and administrative expense ratio (4)			8.4		%			7.3		%			8.2		%			7.9		%
	Premium tax ratio (2)			2.9		%			3.4		%			2.9		%			3.2		%
	Effective tax rate			47.0		%			58.6		%			55.5		%			53.8		%
	Net profit margin, continuing operations (4)			0.8		%			1.2		%			1.0		%			0.6		%

____________
(1)	Source data for calculations in thousands.
(2)	Medical care ratio represents medical care costs as a percentage of premium revenue; premium tax ratio represents premium tax expenses as a percentage of premium revenue plus premium tax revenue. Medical care costs include costs incurred for providing long term services and supports (LTSS).
(3)	Service revenue ratio represents cost of service revenue as a percentage of service revenue.
(4)	Computed as a percentage of total revenue.

MOLINA HEALTHCARE, INC. UNAUDITED CONSOLIDATED BALANCE SHEETS
			December 31,
			2015					2014
			(Amounts in millions, except per-share data)
ASSETS
Current assets:
Cash and cash equivalents			$	2,329				$	1,539
Investments			1,801					1,019
Receivables			597					596
Income taxes refundable			13					—
Prepaid expenses and other current assets			192					49
Derivative asset			374					—
Total current assets			5,306					3,203
Property, equipment, and capitalized software, net			393					341
Deferred contract costs			81					54
Intangible assets, net			122					89
Goodwill			519					272
Restricted investments			109					102
Derivative asset			—					329
Deferred income taxes			18					15
Other assets			28					30
			$	6,576				$	4,435
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Medical claims and benefits payable			$	1,582				$	1,201
Amounts due government agencies			834					527
Accounts payable and accrued liabilities			360					242
Deferred revenue			223					196
Income taxes payable			—					9
Current portion of long-term debt			449					—
Derivative liability			374					—
Total current liabilities			3,822					2,175
Senior notes			962					690
Lease financing obligations			198					157
Lease financing obligations - related party			—					40
Derivative liability			—					329
Other long-term liabilities			37					34
Total liabilities			5,019					3,425
Stockholders’ equity:
Common stock, $0.001 par value; 150 shares authorized; outstanding: 56 shares at December 31, 2015 and 50 shares at December 31, 2014			—					—
Preferred stock, $0.001 par value; 20 shares authorized, no shares issued and outstanding			—					—
Additional paid-in capital			803					396
Accumulated other comprehensive loss			(4		)			(1		)
Retained earnings			758					615
Total stockholders’ equity			1,557					1,010
			$	6,576				$	4,435

____________

Note: Certain 2014 amounts have been reclassified to conform to the 2015 presentation. Specifically, current and non-current deferred issuance costs are now reported as direct deductions from “Current portion of long-term debt,” and “Senior notes,” respectively. Additionally, the aggregate amount of deferred income taxes are now reported as non-current. Both reclassifications are a result of recently adopted accounting pronouncements.

MOLINA HEALTHCARE, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS, CONTINUING AND DISCONTINUED OPERATIONS
			Three Months Ended										Year Ended
			December 31,										December 31,
			2015					2014					2015					2014
			(Amounts in millions)
Operating activities:
Net income			$	30				$	34				$	143				$	62
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			33					35					126					134
Deferred income taxes			5					9					(7		)			(2		)
Share-based compensation			7					6					23					22
Amortization of convertible senior notes and lease financing obligations			8					7					30					27
Other, net			6					3					19					7
Changes in operating assets and liabilities:
Receivables			79					(171		)			56					(298		)
Prepaid expenses and other current assets			28					32					(35		)			(20		)
Medical claims and benefits payable			20					77					379					531
Amounts due government agencies			(146		)			129					307					470
Accounts payable and accrued liabilities			48					37					82					11
Deferred revenue			153					5					24					74
Income taxes			(52		)			17					(22		)			42
Net cash provided by operating activities			219					220					1,125					1,060
Investing activities:
Purchases of investments			(612		)			(337		)			(1,923		)			(953		)
Proceeds from sales and maturities of investments			263					159					1,126					633
Purchases of property, equipment, and capitalized software			(31		)			(43		)			(132		)			(115		)
Increase in restricted investments			(1		)			(10		)			(6		)			(34		)
Net cash paid in business combinations			(373		)			(36		)			(450		)			(44		)
Other, net			(1		)			(8		)			(35		)			(23		)
Net cash used in investing activities			(755		)			(275		)			(1,420		)			(536		)
Financing activities:
Proceeds from senior notes offerings, net of issuance costs			689					—					689					123
Proceeds from common stock offering, net of issuance costs			—					—					373					—
Contingent consideration liabilities settled			—					—					—					(50		)
Proceeds from employee stock plans			10					6					18					14
Principal payments on convertible senior notes			—					(10		)			—					(10		)
Other, net			2					—					5					2
Net cash provided by (used in) financing activities			701					(4		)			1,085					79
Net increase (decrease) in cash and cash equivalents			165					(59		)			790					603
Cash and cash equivalents at beginning of period			2,164					1,598					1,539					936
Cash and cash equivalents at end of period			$	2,329				$	1,539				$	2,329				$	1,539

MOLINA HEALTHCARE, INC.
UNAUDITED NON-GAAP FINANCIAL MEASURES

The Company uses two non-GAAP financial measures as supplemental metrics in evaluating its financial performance, making financing and business decisions, and forecasting and planning for future periods. For these reasons, management believes such measures are useful supplemental measures to investors in comparing the Company’s performance to the performance of other public companies in the health care industry. These non-GAAP financial measures should be considered as supplements to, and not as substitutes for or superior to, GAAP measures.

The first of these non-GAAP measures is earnings before interest, taxes, depreciation and amortization (EBITDA). The following table reconciles net income, which the Company believes to be the most comparable GAAP measure, to EBITDA.

			Three Months Ended										Year Ended
			December 31,										December 31,
			2015					2014					2015					2014
			(Amounts in millions)
Net income			$	30				$	34				$	143				$	62
Adjustments:
Depreciation, and amortization of intangible assets and capitalized software			33					30					120					114
Interest expense			22					15					67					57
Income tax expense			26					48					179					72
EBITDA			$	111				$	127				$	509				$	305

The second of these non-GAAP measures is adjusted net income, continuing operations (including adjusted net income per diluted share). The following table reconciles net income from continuing operations, which the Company believes to be the most comparable GAAP measure, to adjusted net income, continuing operations. The source data for per diluted share calculations below is in thousands.

			Three Months Ended December 31,																				Year Ended December 31,
			2015										2014										2015										2014
			(In millions, except per diluted share amounts)
			Amount					Per share					Amount					Per share					Amount					Per share					Amount					Per share
Net income, continuing operations			$	30				$	0.51				$	34				$	0.69				$	143				$	2.57				$	62				$	1.30
Adjustments, net of tax:
Amortization of convertible senior notes and lease financing obligations			5					0.08					4					0.09					19					0.34					17					0.36
Amortization of intangible assets			3					0.06					3					0.06					11					0.20					13					0.27
Adjusted net income, continuing operations (1)			$	38				$	0.65				$	41				$	0.84				$	173				$	3.11				$	92				$	1.93

________________________
(1)	Beginning in the first quarter of 2015, the Company revised its calculation of adjusted net income, continuing operations. The Company no longer subtracts “depreciation, and amortization of capitalized software” and “share-based compensation” from net income, continuing operations to arrive at adjusted net income, continuing operations. The Company made this change to better reflect the way in which it evaluates its financial performance, makes financing and business decisions, and forecasts and plans for future periods. All periods presented conform to this presentation.

MOLINA HEALTHCARE, INC. UNAUDITED HEALTH PLANS SEGMENT MEMBERSHIP, CONTINUING OPERATIONS
			As of December 31,
			2015				2014				2013
Ending Membership by Health Plan:
California			620,000				531,000				368,000
Florida			440,000				164,000				89,000
Illinois			98,000				100,000				4,000
Michigan			328,000				242,000				213,000
New Mexico			231,000				212,000				168,000
Ohio			327,000				347,000				255,000
Puerto Rico (1)			348,000				—				—
South Carolina			99,000				118,000				—
Texas			260,000				245,000				252,000
Utah			102,000				83,000				86,000
Washington			582,000				497,000				403,000
Wisconsin			98,000				84,000				93,000
			3,533,000				2,623,000				1,931,000
Ending Membership by Program:
Temporary Assistance for Needy Families (TANF), CHIP(2)			2,312,000				1,809,000				1,603,000
Medicaid Expansion(3)			557,000				385,000				—
Aged, Blind or Disabled (ABD)			366,000				347,000				289,000
Marketplace(3)			205,000				15,000				—
Medicare-Medicaid Plan (MMP) - Integrated(4)			51,000				18,000				—
Medicare Special Needs Plans			42,000				49,000				39,000
			3,533,000				2,623,000				1,931,000

_______________________
(1)	The Puerto Rico health plan began serving members effective April 1, 2015.
(2)	CHIP stands for Children’s Health Insurance Program.
(3)	Medicaid Expansion membership phased in, and Marketplace became available for consumers to access coverage, beginning January 1, 2014.
(4)	MMP members who receive both Medicaid and Medicare coverage from the Company. The Company began serving members under this program in the second quarter of 2014.

MOLINA HEALTHCARE, INC. UNAUDITED SELECTED HEALTH PLANS SEGMENT FINANCIAL DATA, CONTINUING OPERATIONS (In millions, except percentages and per-member per-month amounts)
			Three Months Ended December 31, 2015
			Member Months(1)				Premium Revenue										Medical Care Costs									MCR(2)				Medical Margin
							Total					PMPM					Total					PMPM
California			1.8				$	563				$	309.31				$	474				$	260.44			84.2	%			$	89
Florida			1.2				329					277.71					318					268.98				96.9				11
Illinois			0.3				85					287.88					79					266.91				92.7				6
Michigan			1.0				329					334.44					282					287.00				85.8				47
New Mexico			0.7				304					438.82					263					379.10				86.4				41
Ohio			1.0				500					501.11					437					436.77				87.2				63
Puerto Rico			1.1				192					184.79					159					153.04				82.8				33
South Carolina			0.3				78					261.07					69					229.48				87.9				9
Texas			0.7				543					693.06					496					633.77				91.4				47
Utah			0.4				89					290.05					77					251.55				86.7				12
Washington			1.7				416					241.28					376					217.77				90.3				40
Wisconsin			0.3				55					186.57					53					182.41				97.8				2
Other(3)			—				5					—					27					—				—				(22		)
			10.5				$	3,488				$	334.62				$	3,110				$	298.43			89.2	%			$	378
			Three Months Ended December 31, 2014
			Member Months(1)				Premium Revenue										Medical Care Costs									MCR(2)				Medical Margin
							Total					PMPM					Total					PMPM
California			1.6				$	463				$	291.27				$	379				$	238.49			81.9	%			$	84
Florida			0.4				126					348.60					129					356.76				102.3				(3		)
Illinois			0.2				84					353.71					78					323.76				91.5				6
Michigan			0.7				213					294.14					185					254.41				86.5				28
New Mexico			0.7				299					456.40					294					448.99				98.4				5
Ohio			1.1				492					475.15					426					412.02				86.7				66
Puerto Rico			—				—					—					—					—				—				—
South Carolina			0.4				93					263.97					73					208.10				78.8				20
Texas			0.8				339					458.42					299					404.88				88.3				40
Utah			0.2				76					300.28					69					277.44				92.4				7
Washington			1.4				364					246.91					342					232.08				94.0				22
Wisconsin			0.2				38					148.99					36					139.75				93.8				2
Other(3)			—				12					—					12					—				—				—
			7.7				$	2,599				$	338.52				$	2,322				$	302.60			89.4	%			$	277

____________
(1)	A member month is defined as the aggregate of each month’s ending membership for the period presented.
(2)	The MCR represents medical costs as a percentage of premium revenue. Source data in thousands.
(3)	“Other” medical care costs include primarily medically related administrative costs at the parent company, and direct delivery costs.

MOLINA HEALTHCARE, INC. UNAUDITED SELECTED HEALTH PLANS SEGMENT FINANCIAL DATA, CONTINUING OPERATIONS (In millions, except percentages and per-member per-month amounts)
			Year Ended December 31, 2015
			Member Months(1)				Premium Revenue										Medical Care Costs										MCR(2)				Medical Margin
							Total					PMPM					Total					PMPM
California			7.1				$	2,101				$	296.93				$	1,823				$	257.67				86.8	%			$	278
Florida			4.1				1,197					289.38					1,081					261.49					90.4				116
Illinois			1.2				397					328.93					367					303.72					92.3				30
Michigan			3.4				1,067					317.15					903					268.27					84.6				164
New Mexico			2.8				1,237					446.27					1,106					398.98					89.4				131
Ohio			4.1				2,034					499.34					1,718					421.61					84.4				316
Puerto Rico			3.2				567					178.31					505					158.80					89.1				62
South Carolina			1.3				348					267.25					278					213.30					79.8				70
Texas			3.1				1,961					621.25					1,809					573.32					92.3				152
Utah			1.2				331					286.22					300					259.32					90.6				31
Washington			6.6				1,602					242.36					1,470					222.36					91.7				132
Wisconsin			1.2				261					213.48					215					176.01					82.4				46
Other(3)			—				37					—					116					—					—				(79		)
			39.3				$	13,140				$	334.71				$	11,691				$	297.81				89.0	%			$	1,449
			Year Ended December 31, 2014
			Member Months(1)				Premium Revenue										Medical Care Costs										MCR(2)				Medical Margin
							Total					PMPM					Total					PMPM
California			5.6				$	1,523				$	270.51				$	1,269				$	225.37				83.3	%			$	254
Florida			1.1				439					397.79					419					379.95					95.5				20
Illinois			0.3				153					498.48					141					456.88					91.7				12
Michigan			2.8				781					278.68					661					235.81					84.6				120
New Mexico			2.5				1,076					435.17					996					402.92					92.6				80
Ohio			3.7				1,553					425.47					1,335					365.87					86.0				218
Puerto Rico			—				—					—					—					—					—				—
South Carolina			1.5				381					260.72					323					220.89					84.7				58
Texas			3.0				1,318					442.32					1,197					401.81					90.8				121
Utah			1.0				310					310.64					285					286.43					92.2				25
Washington			5.5				1,305					236.27					1,219					220.75					93.4				86
Wisconsin			1.0				156					150.87					136					130.91					86.8				20
Other(3)			—				28					—					95					—					—				(67		)
			28.0				$	9,023				$	322.68				$	8,076				$	288.84				89.5	%			$	947

____________
(1)	A member month is defined as the aggregate of each month’s ending membership for the period presented.
(2)	The MCR represents medical costs as a percentage of premium revenue. Source data in thousands.
(3)	“Other” medical care costs include primarily medically related administrative costs at the parent company, and direct delivery costs.

MOLINA HEALTHCARE, INC. UNAUDITED SELECTED HEALTH PLANS SEGMENT FINANCIAL DATA, CONTINUING OPERATIONS (In millions, except percentages and per-member per-month amounts)
			Three Months Ended December 31, 2015 (1)
			Member Months(2)				Premium Revenue										Medical Care Costs										MCR(3)				Medical Margin
							Total					PMPM					Total					PMPM
TANF and CHIP			6.9				$	1,203				$	175.96				$	1,092				$	159.83				90.8	%			$	111
Medicaid Expansion			1.7				637					386.27					503					305.28					79.0				134
ABD			1.1				1,059					967.72					995					910.11					94.0				64
Marketplace			0.6				126					223.57					111					194.80					87.1				15
MMP			0.1				330					2,160.91					290					1,905.00					88.2				40
Medicare			0.1				133					1,076.00					119					954.40					88.7				14
			10.5				$	3,488				$	334.62				$	3,110				$	298.43				89.2	%			$	378
			Year Ended December 31, 2015 (1)
			Member Months(2)				Premium Revenue										Medical Care Costs										MCR(3)				Medical Margin
							Total					PMPM					Total					PMPM
TANF and CHIP			25.5				$	4,483				$	175.64				$	4,122				$	161.50				92.0	%			$	361
Medicaid Expansion			5.9				2,291					391.62					1,828					312.58					79.8				463
ABD			4.3				4,122					966.37					3,784					887.27					91.8				338
Marketplace			2.6				651					251.96					481					185.85					73.8				170
MMP			0.5				1,063					2,033.76					974					1,863.93					91.6				89
Medicare			0.5				530					1,038.15					502					982.50					94.6				28
			39.3				$	13,140				$	334.71				$	11,691				$	297.81				89.0	%			$	1,449

_______________________
(1)	Three and twelve months ended December 31, 2014 data not presented due to lack of comparability.
(2)	A member month is defined as the aggregate of each month’s ending membership for the period presented.
(3)	The MCR represents medical costs as a percentage of premium revenue. Source data in thousands.

MOLINA HEALTHCARE, INC. UNAUDITED SELECTED HEALTH PLANS SEGMENT FINANCIAL DATA, CONTINUING OPERATIONS (In millions, except percentages and per-member per-month amounts)
The following tables provide the details of the Company’s medical care costs from continuing operations for the periods indicated:
			Three Months Ended December 31,
			2015														2014
			Amount					PMPM					% of Total				Amount					PMPM				% of Total
Fee for service			$	2,297				$	220.34				73.9	%			$	1,644				$	214.14			70.8	%
Pharmacy			449					43.08					14.4				354					46.12				15.3
Capitation			257					24.69					8.3				211					27.60				9.1
Direct delivery			43					4.14					1.4				26					3.42				1.1
Other			64					6.18					2.0				87					11.32				3.7
			$	3,110				$	298.43				100.0	%			$	2,322				$	302.60			100.0	%
			Year Ended December 31,
			2015														2014
			Amount					PMPM					% of Total				Amount					PMPM				% of Total
Fee for service			$	8,572				$	218.35				73.3	%			$	5,673				$	202.87			70.2	%
Pharmacy			1,610					41.01					13.8				1,273					45.54				15.8
Capitation			982					25.02					8.4				748					26.77				9.3
Direct delivery			128					3.26					1.1				96					3.44				1.2
Other			399					10.17					3.4				286					10.22				3.5
			$	11,691				$	297.81				100.0	%			$	8,076				$	288.84			100.0	%

The following table provides the details of the Company’s medical claims and benefits payable as of the dates indicated:
		December 31,
		2015					2014
Fee-for-service claims incurred but not paid (IBNP)		$	1,191				$	871
Pharmacy payable		88					71
Capitation payable		37					28
Other (1)		266					231
		$	1,582				$	1,201

______________________
(1)	“Other” medical claims and benefits payable include amounts payable to certain providers for which the Company acts as an intermediary on behalf of various state agencies without assuming financial risk. Such receipts and payments do not impact the Company’s consolidated statements of income. As of December 31, 2015 and 2014, the Company had recorded non-risk provider payables of approximately $167 million and $119 million, respectively.

MOLINA HEALTHCARE, INC. UNAUDITED CHANGE IN MEDICAL CLAIMS AND BENEFITS PAYABLE (Dollars in millions, except per-member amounts)
The Company’s claims liability includes a provision for adverse claims deviation based on historical experience and other factors including, but not limited to, variations in claims payment patterns, changes in utilization and cost trends, known outbreaks of disease, and large claims. The Company’s reserving methodology is consistently applied across all periods presented. The amounts displayed for “Components of medical care costs related to: Prior period” represent the amount by which the Company’s original estimate of claims and benefits payable at the beginning of the period were more than the actual amount of the liability based on information (principally the payment of claims) developed since that liability was first reported. The following table presents the components of the change in medical claims and benefits payable from continuing and discontinued operations combined for the periods indicated:
		Year Ended
		December 31,
		2015				2014
Medical claims and benefits payable, beginning balance		$	1,201			$	670
Components of medical care costs related to:
Current period		11,832				8,123
Prior period		(141		)		(46		)
Total medical care costs		11,691				8,077
Change in non-risk provider payables		48				(32		)
Payments for medical care costs related to:
Current period		10,448				7,064
Prior period		910				450
Total paid		11,358				7,514
Medical claims and benefits payable, ending balance		$	1,582			$	1,201
Benefit from prior period as a percentage of:
Balance at beginning of period		11.8		%		6.9		%
Premium revenue, trailing twelve months		1.1		%		0.5		%
Medical care costs, trailing twelve months		1.2		%		0.6		%
Fee-For-Service Claims Data:
Days in claims payable, fee for service		48				49
Number of members at end of year		3,533,000				2,623,000
Number of claims in inventory at end of year		380,800				307,700
Billed charges of claims in inventory at end of year		$	816			$	719
Claims in inventory per member at end of year		0.11				0.12
Billed charges of claims in inventory per member at end of year		$	230.91			$	273.92
Number of claims received during the year		40,173,300				27,597,000
Billed charges of claims received during the year		$	46,211			$	30,316

MOLINA HEALTHCARE, INC. HEALTH INSURER FEE DETAILS BY HEALTH PLAN (In millions)
			HIF Reimbursement Revenue, Gross(1)
			Year Ended December 31, 2015
			Recognized																									Necessary for Full Reimbursement
			Q1 2015					Q2 2015					Q3 2015					Q4 2015					Total
2015 HIF:
California			$	—				$	17				$	6				$	8				$	31				$	31
Florida			2					2					2					2					8					8
Illinois			1					1					1					1					4					4
Michigan			—					—					21					7					28					28
New Mexico			7					8					8					7					30					30
Ohio			12					12					12					12					48					48
South Carolina			3					3					3					3					12					12
Texas			6					6					6					5					23					23
Utah			—					—					4					2					6					6
Washington			11					11					6					9					37					37
Wisconsin			1					1					1					2					5					5
Subtotal, Medicaid			43					61					70					58					232					232
Marketplace			—					—					1					1					2					2
Medicare			6					4					4					5					19					19
			49					65					75					64					253					$	253
2014 HIF:
California			—					12					—					—					12
Michigan			—					—					7					—					7
Utah			—					—					1					—					1
			$	49				$	77				$	83				$	64				$	273
Recognized in:
Health insurer fee revenue			$	48				$	74				$	81				$	61				$	264
Premium tax revenue			1					3					2					3					9
			$	49				$	77				$	83				$	64				$	273

_____________
(1)	Amounts in the table include the Company’s estimate of the full economic impact of the excise tax including premium tax and the income tax effect.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160208006217/en/

Source: Molina Healthcare, Inc.

Molina Healthcare, Inc.
Juan José Orellana, 562-435-3666, ext. 111143
Investor Relations