ISCA Presentation Humana Acquisition Integration

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ISCA Presentation Humana Acquisition Integration
Bill Baldwin November 17, 2006
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Security Quotes

• Security is mostly superstition. It does not
  exist in nature.Life is either a daring
  adventure or nothing
• Helen Keller
• Security is a kind of death
• Tennessee Williams

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Introduction

• Bio
• Director, Acquisitions Integration
• Louisville Native
• 36 years with Humana
• 33 years in Information Technology
• Masters Degree in Business Admin.
• Masters Degree in Health Services Mgmt
• Goal Today
• Inform audience about Humanas Acquisition
  Integration Strategy Challenges
• Discuss role of State Federal regulations and
  subsequent audit practices

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About Humana

• One of the largest publicly traded health
  benefits companies
• Headquartered in Louisville
• Approx 18K associates
• Ranked 150th on Fortune 500 Ranking
• Approx Revenue 14.4B
• In business for 45 years
• Our vision to be the most trusted name in health
  solutions
• Our value proposition is to deliver Humanas
  Guidance Solution to produce lower cost and a
  superior experience for consumers.

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Humana History
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Business Growth

• Growth Paths
• Direct Sales
• Acquisitions
• Sales
• Commercial
• Government
• Administrative Service Outsourcing (ASO)

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Business Growth

• Growth Path
• Acquisitions
• 6 major acquisitions in last 10 years
• CHA (KY) - CarePlus (FL)
• Ochsner (LA) - Choice Care (OH)
• PCA (FL) - Emphesys (WI)

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My Role

• Integrate acquired companies into Humanas
  business practices
• Evaluate best practices of acquired companies
  advise Humana leadership for potential adoption
• Eliminate redundant practices and associated
  staffing
• Maximize ROI

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Challenges

• Maintain acquired site work force through
  integration
• Maintain productivity
• Migrating membership data onto Humana IT platform
• Staff Reductions
• Contract Evaluation
• Regulation Adherence

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What internal auditors can do to add value?

• Get engaged understand your business
• Thoroughly understand the regulations
• Allow creative adherence to the regs over
  compliance is very expensive and does not add
  value
• Keep an open mind towards compliance (it doesnt
  have to be overly complicated or expensive)
• Assist your business units with compliance
• Be a partner not an adversary

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Summary

• Humana is one of the U.S. largest health
  solutions providers
• We use acquisitions as a way to increase our
  membership
• Acquisition integration is complicated and
  expensive
• Acquisitions are impacted by State and Federal
  regulations
• Auditing for regulation compliance requires
  thorough understanding of business and
  regulations plus compliance creativity.

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• Questions??

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