REACHING FOR THE SUMMIT
2013 Annual Review
TRANSFORMING THE HEALTH OF THE COMMUNITY,
ONE PERSON AT A TIME
centene corporation Annual Review 2013 Centene Corporation is a leading multi-line healthcare enterprise that provides
programs and related services to address the needs of under-insured and
uninsured individuals. Centene offers unique, cost-effective coverage solutions
for low-income populations through locally based health plans and a wide
range of specialty services.
TABLE OF CONTENTS
2013 at a Glance 1
Letter from the Chairman 2
Company and Financial Summary 6
Nationwide Presence 7
2013 Highlights 8
Focused on the Individual 10
Whole Health is Everything 12
We're Right Here 14
Helping to Create Healthier Communities 16
Awards and Recognition 17
Quarterly Selected Financial Information 18
Selected Financial Information 19
Corporate Information 20
centene corporation Annual Review 2013 Centene is living its purpose
— transforming the health of the
community, one individual at a time —
everyday. We leverage the strength of
our purpose and our three brand pillars
to galvanize our growing base of nearly
9 thousand employees nationwide and
achieve remarkable results.
2013 at a Glance
2.7
Million At-risk Managed
Care Membership
Current States with At-risk Managed
Care Membership
20
$10.5
Billion Premium and Service Revenues
from Continuing Operations
Million in Total Operating Cash Flow
$382.5
2,000
Jobs Added in 2013
Stock Price Growth in 2013
43.8%
centene corporation
Annual Review 2013
LETTER FROM THE
CHAIRMAN
Michael F. Neidorff
Chairman, President and
Chief Executive Officer
The year 2013 was one of vast change and
transformation in the healthcare industry. As the
nation tackled the challenges associated with
implementing the Affordable Care Act, Centene was
able to maintain its strong footing and successfully
deliver on our strategy, growing premium and service
revenues from continuing operations 37 percent
from 2012 to $10.5 billion. Earnings from continuing
operations increased to $277.4 million, or 157 percent,
over 2012. We now coordinate care for more than
2.7 million at-risk managed care members in 20
states. While these statistics demonstrate
tremendous financial success for Centene, the
numbers alone do not display the true value of what
we bring to the market.
centene corporation Annual Review 2013 Through a diversified product portfolio
and expanded geographic reach,
Centene continued to deliver results for
our state partners and other customers
by maintaining focus on our company's
purpose: transforming the health of
our community, one individual at a
time. This singular purpose is what
drives each of our 8,800 employees
across the country to provide local,
coordinated care and support services
centered on the whole health of the
individuals we serve. In 2013, this focus
was evidenced by our organic growth
within our existing states, new Medicaid
contracts, new contract awards in the
correctional healthcare services arena,
key acquisitions to enhance our medical
management platform, and preparation
for entrance into Health Insurance
Marketplaces in nine states in 2014.
37% YEAR-OVER-YEAR INCREASE IN
TOTAL PREMIUM AND SERVICE REVENUES
FROM CONTINUING OPERATIONS
$10.5 B
$7.7 B
3
Centene continued to deliver
results by maintaining focus on
its purpose.
First, I would like to focus on our
organic growth within the states where
we have business. This has been a key
strategy for Centene – enter a state
under a single managed care contract,
prove our value to our state customers,
and expand our services to other
populations within that state. We believe
as our state partners continue to move
additional populations, such as those with
complex care needs, into managed care
programs, Centene’s multi-state footprint
coupled with our integrated approach to
care have positioned us well for organic
growth in these markets.
I would like to highlight a few examples
of the kind of organic growth we
experienced this year. Centene’s Florida
subsidiary, Sunshine Health, was selected
to serve Long Term Care members in 10
regions in Florida; our Texas subsidiary,
Superior HealthPlan, expanded its
STAR+PLUS contract serving older adults
and people with disabilities; and our
South Carolina subsidiary was selected
to serve members eligible for both
Medicaid and Medicare (Dual Eligibles).
Sunshine Health was also selected for the
Managed Medical Assistance (MMA)
program in nine regions, and Centene’s
Massachusetts’s health plan, CeltiCare
LETTER FROM THE CHAIRMAN
(CONTINUED)
Health, expanded its reach with a new
Medicaid contract in five regions. In
addition to the growth Centene
experienced in existing markets, we also
continued our geographic expansion with
entry into Kansas, California and New
Hampshire through new Medicaid
managed care contracts.
Also in 2013, we further expanded our
product portfolio through a new market
opportunity in the correctional healthcare
services arena. Centene entered the
correctional healthcare services arena
through a joint venture with MHM
Services, a national leader in providing
healthcare services to correctional
systems. The joint venture company,
Centurion, leverages Centene’s nearly
30 years of experience with state-
sponsored managed care programs and
MHM’s unique expertise in providing
healthcare services to inmates. During
2013, Centurion won contracts in
Massachusetts, Tennessee and Minnesota.
Centene understands that, along
with this rapid growth, we need to
expand our capabilities to ensure
we are continuing to provide the
best care possible for our diverse
member base.
As we continue to serve more members
with complex healthcare needs, such
as the Aged, Blind and Disabled,
Dual Eligibles and those receiving
Long Term Care services, we aim to
provide a continuum of high quality
healthcare services that allows us to
effectively manage the complex needs
of these members. Centene currently
serves more than 300,000 high-acuity
members in 13 states. To that end, early
in 2013, we acquired AcariaHealth,
a comprehensive specialty pharmacy
company, improving how pharmaceutical
benefits are delivered to our members
with complex conditions. In early 2014,
Centene acquired a majority interest in
U.S. Medical Management (USMM), a
leading management services organization
and provider of in-home health services
for high acuity populations.
In conjunction with the investment in
USMM, Centene announced the
formation of a new healthcare enterprise
holding company. This new business unit
is expected to connect Centene with other
health solution providers while preserving
the entrepreneurial spirit and innovation
that has led to improved health outcomes,
development of a more efficient care
model and the facilitation of sales to third
party companies.
centene corporation Annual Review 2013 5
disciplined approach to pricing across all
states. I am proud of the hard work and
dedication our employees put into this
new opportunity for Centene. The Health
Insurance Marketplaces are only one part
of our overall growth pipeline, as you
have seen from the many other
accomplishments and milestones we
achieved this year.
In closing, as we enter 2014, we also enter
a new era of healthcare. We believe we are
in a strong position to benefit from the
significant market opportunities that lie
ahead. Most importantly, millions of
Americans are counting on Centene to
continue delivering the comprehensive,
quality healthcare that has become our
trademark for the past 30 years.
Sincerely,
MICHAEL F. NEIDORFF
Chairman, President and Chief Executive Officer
Centene Corporation
NEW ENTERPRISE STRUCTURE TO
SUPPORT INNOVATION
SM
Along with these enhanced capabilities,
Centene announced the acquisition of a
majority stake in Fidelis SecureCare of
Michigan, expected to close in late 2014.
Fidelis SecureCare was recently selected
by the Michigan Department of
Community Health as one of six health
plans to provide integrated healthcare
services to Dual Eligibles in Macomb and
Wayne counties.
At the beginning of 2013, the healthcare
industry was preparing for the
implementation of the Affordable Care
Act. Centene worked diligently to meet
the necessary regulatory and operational
requirements. In January 2014, we began
providing healthcare services under the
name Ambetter on the newly formed
Health Insurance Marketplaces in nine
states. We maintained a consistent,
COMPANY AND
FINANCIAL SUMMARY
FINANCIAL HIGHLIGHTS FROM
CONTINUING OPERATIONS
in thousands
Premium and
Service Revenues
Earnings from
Operations
2013
2012
2011
2010
2009
$ 10,526,040
$ 7,681,631
$ 5,051,902
$ 4,283,833
$ 3,878,283
277,417
107,966
203,803
157,069
138,135
Net Earnings (1)
161,218
88,533
120,518
90,947
86,093
Total Assets
3,413,483
2,534,612
2,092,530
1,937,852
1,668,772
(1) Attributable to Centene Corporation
PREMIUM AND
SERVICE REVENUES
in millions
EARNINGS FROM
OPERATIONS
in millions
AT-RISK MEMBERSHIP
in thousands
6
2
5
,
0
1
2
8
6
,
7
2
5
0
,
5
4
8
2
,
4
$10,000
$8,000
$6,000
$4,000
$2,000
8
7
8
,
3
0
$300
$225
$150
$75
0
7
7
2
$
4
0
2
$
7
5
1
$
8
3
1
$
8
0
1
$
3,000
2,250
1,500
750
0
3
2
7
,
5 2
2
4
,
2
5
3
6
,
1
8
5
4
,
1
4
3
5
,
1
‘09 ‘10 ‘11
‘12 ‘13
‘09 ‘10 ‘11
‘12
‘13
‘09 ‘10 ‘11
‘12
‘13
centene corporation Annual Review 2013 NATIONWIDE
PRESENCE
7
Medicaid/CHIP
ABD
Foster Care
Medicare SNP
Dual Eligibles
Correctional Healthcare
Health Insurance Marketplace
Long Term Care embed in contract
GROUP AND PRODUCT SOLUTIONS BY STATE
ARIZONA
Medicare SNP
Long Term Care
ARKANSAS
Medicaid
Health Insurance Marketplace
CALIFORNIA
Medicaid
CHIP
ABD
FLORIDA
Medicaid
CHIP
ABD
Foster Care
Medicare SNP
Health Insurance Marketplace
Long Term Care
GEORGIA
Medicaid
CHIP
Medicare SNP
Health Insurance Marketplace
ILLINOIS
ABD
Dual Eligibles (1)
Long Term Care
INDIANA
Medicaid
CHIP
Health Insurance Marketplace
MISSOURI
Medicaid
CHIP
Foster Care
KANSAS
Medicaid
CHIP
ABD
Foster Care
Long Term Care
LOUISIANA
Medicaid
CHIP
ABD
Foster Care
MASSACHUSETTS
Medicaid Expansion
Correctional Healthcare
Health Insurance Marketplace
MINNESOTA
Correctional Healthcare
MISSISSIPPI
Medicaid
ABD
Foster Care
Health Insurance Marketplace
NEW HAMPSHIRE
Medicaid
CHIP
ABD
Foster Care
OHIO
Medicaid
CHIP
ABD
Medicare SNP
Dual Eligibles (1)
Health Insurance Marketplace
SOUTH CAROLINA
Medicaid
CHIP
ABD
Dual Eligibles (1)
TENNESSEE
Correctional Healthcare
(1) Operations expected to commence in 2014
TEXAS
Medicaid
CHIP
ABD
Foster Care
Medicare SNP
Health Insurance Marketplace
WASHINGTON
Medicaid
CHIP
ABD
Foster Care
Health Insurance Marketplace
WISCONSIN
Medicaid
CHIP
ABD
Medicare SNP
2013 HIGHLIGHTS
Florida subsidiary selected to serve
Long Term Care members in 10 regions
in Florida.
Florida subsidiary awarded commendable
accreditation rating by NCQA.
Centene received notice of intent to
award California Medicaid contract to
serve members under the state’s
Medi-Cal Managed Care Rural Expansion
program.
Centene Corporation completes
acquisition of specialty pharmacy leader
AcariaHealth, one of the nation’s largest,
independent, comprehensive specialty
pharmacy companies.
Ohio subsidiary awarded commendable
accreditation rating from the NCQA.
Centene climbs higher in 2013 Fortune
500 ranking to #303, up 150 places from
the previous year’s ranking.
Centene partners with MHM Services to
serve Massachusetts State Correctional
System via ongoing joint venture
between Centene and MHM Services,
called Centurion.
Centene earns national recognition for
innovative member programs. Honored
for five of these programs at the Fourth
Annual Case in Point Platinum Awards.
Q1
Centurion selected to provide
correctional healthcare in Tennessee, via
ongoing joint venture between Centene
and MHM Services.
Q2
centene corporation Annual Review 2013 9
Florida subsidiary begins operating
under a contract with the Florida Agency
for Health Care Administration to serve
members of the Medicaid Managed Care
Long Term Care program.
Centene launches innovative leadership
program, a partnership between Centene,
Trinity University of San Antonio, Texas,
and Washington University in St. Louis.
Moody’s investor service affirms
Centene's senior debt rating of Ba2 and
raises outlook of the company to stable.
Centene’s medical triage and health
education outreach company, NurseWise,
receives full core and health call center
accreditation from URAC.
Centene’s Texas subsidiary awarded
contract to expand STAR+PLUS service.
Centurion selected to provide
correctional healthcare in Minnesota.
Centene’s Massachusetts subsidiary
awarded Medicaid contract in all five
state regions.
Centene and Cenpatico partner with
Children’s National Health System to fight
bullying.
Florida Medicaid announces intent
to award contracts for the Managed
Medical Assistance (MMA) program in
nine regions and statewide Foster Care
contract to Centene subsidiary.
Centene’s South Carolina subsidiary
selected to serve dual-eligible members,
as part of the state’s pilot program to
provide integrated and coordinated care
for individuals who are eligible for both
Medicare and Medicaid.
Centene’s Wisconsin and South Carolina
subsidiaries awarded commendable
accreditation ratings by NCQA.
Q4
Q3
centene corporation
Annual Review 2013
FOCUSED ON THE
INDIVIDUAL
Yesterday, healthcare was defined by what happened
when you got sick. Today, healthcare is about keeping
you healthy.
We believe that healthcare coverage
can be about more than paying
physicians; it’s about community
wellness and health education. It’s
about getting ahead of infirmity instead
of struggling to get out from under it.
We know that illness is an inevitable
part of life, and we are always there to
help our members receive the right
care at the right place and at the right
time to help them get better. Since we
understand that healthcare is not one
size fits all, we take a personal
approach in tending to each member's
unique qualities and circumstances.
We also recognize that it’s the choices
individuals make when doing well that
helps prevent illness or manage chronic
conditions, so we provide the
information, technology, and tools to
help our members stay healthy. We do
all of this because we believe that
health is the key; it is the building block
that allows us to focus on everything
that makes our lives better, and so our
ultimate goal is to help our members
live healthy lives.
Focus on Individuals
Whole Health
Active Local Involvement
centene corporation Annual Review 2013 11
BETTER HEALTH
OUTCOMES
The Start Smart For Your Baby© (SSFB)
Texting Program is a component of our
comprehensive SSFB Care Management
program and aims to improve maternal
and infant health by providing timely
health information, resources, and
reminders to members during pregnancy
and continuing six months postpartum.
The goals of the program are to improve
prenatal and postpartum visit compliance,
as well as promote breastfeeding in our
members.
PERCENTAGES OF IMPROVEMENT IN PRENATAL AND
POSTPARTUM COMPLIANCE
90+ day enrollment
PERCENTAGES OF BREASTFEEDING MOTHERS
%
6
.
6
%
8
.
6
%
2
.
3
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
%
9
.
9
8
%
8
.
6
6
Control Group (21-30 Days Post
Delivery)
SSFB Texting Program Members
(21 Days Post Delivery)
%
5
.
0
5
%
8
.
4
3
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Frequency of
Ongoing Prenatal
Care
Timeliness of
Prenatal Care
Postpartum
Visit Rate
Any Breastfeeding
Exclusive Breastfeeding
CENTENE IN ACTION
A 37-year-old farm worker suffered from a history of asthma and depended on frequent visits to the ER
for medical attention. Compounding his condition were untreated depression and fluctuations in
Medicaid eligibility due to income irregularity. These created additional barriers between him and control
of his health.
This is where Centene steps in. Our health plan case manager conducts home visits with the member,
compiles background information with the help of a primary care physician, and coordinates a treatment
plan with our wellness and disease management company. A health coach assists the member in
accessing resources to help him remain medically compliant. Simultaneously, our behavioral health nurse
addresses the untreated depression, while Centene’s health information systems monitor progress and
alert us of any change in his Medicaid eligibility status.
One month after seeing a pulmonologist, his asthma symptoms were in much better control without any
nighttime awakening or wheezing. He also has learned to avoid some environmental triggers of his asthma
with assistance from his health coach.
centene corporation
Annual Review 2013
WHOLE HEALTH IS
EVERYTHING
Keeping people healthy requires thinking outside the
bounds of traditional healthcare. Whole Health
represents all the ways we can improve the lives of the
people we touch. Whole Health is everything. It’s what
we stand for and have stood for since our beginning.
Whole Health is local and individual,
it’s the family and the community.
It means that not only the doctor and
the nurse, but also the educator, the
parent, and the employer are all part
of the healthcare system.
Whole Health understands the value
of helping others lower stress, and
that lower stress means better health.
It recognizes that when children have
an opportunity to succeed, we all
feel better.
Whole Health recognizes that when
it comes to health, everything matters.
And so we look for ways, big and small,
to improve the lives of our members.
Whole Health does not promise that
we can serve every need or solve every
problem. It is an awareness that when it
comes to improving the health of our
members, nothing should be ignored.
Focus on Individuals
Whole Health
Active Local Involvement
centene corporation Annual Review 2013 BETTER HEALTH
OUTCOMES
13
Sickle Cell Disease is a chronic and often
life threatening condition that, despite
recent advancements in treatment, is
still associated with a high utilization
of medical resources, decreased life
expectancy, and reduced quality of life.
In response, Centene has developed an
innovative “My Route to Health Sickle
Cell Program” aimed at improving
health outcomes of our members
affected by sickle cell disease through
community-based, culturally-sensitive
initiatives. One of the primary goals
of “My Route to Health Sickle Cell
Program” is to increase hydroxyurea
utilization, which can lead to a reduction
of inpatient hospitalization
for pain, fewer instances of acute chest
syndrome, lessened severity of anemia,
and decreased need for transfusions.
UTILIZATION IN SICKLE CELL MEMBER POPULATION
hydroxyurea fills per 1,000 member months
SICKLE CELL RELATED ER VISITS
per 1,000 member months
0
.
3
7
0
.
3
6
9
.
8
4
70
60
50
40
30
20
10
0
150
125
100
75
50
25
0
7
.
8
3
1
9
.
0
3
1
9
.
7
0
1
2011
2012
2013
2011
2012
2013
CENTENE IN ACTION
A 60-year old homeless man who is wheelchair-bound suffered from oxygen-dependent chronic
obstructive pulmonary disease (COPD) and cellulitis on his legs. Despite numerous hospitalizations over
the past six years, he was reluctant to go to the doctor or proactively seek medical care. Lack of financial
resources as well as poor nutrition and social support compounded his reluctance and created additional
barriers for him in managing his COPD. After another hospital admission, Centene’s integrated care team
stepped in to provide housing assistance, support provisions and follow-up to ensure he was receiving the
medical care he needs.
He was successfully transferred from the hospital setting to a skilled nursing facility and eventually to
home. His physical activity increased being able only to walk 10 steps to walking 70-80 steps and climbing
15 stairs before experiencing shortness of breath. He works closely with his integrated care team, and is
no longer hesitant about medical appointments. He refills his prescriptions regularly, visits his primary
care physician as scheduled and has not been readmitted to the hospital.
centene corporation
Annual Review 2013
WE’RE RIGHT HERE
Quality healthcare requires a local approach.
Maintaining good long-term health relies on more than
just one person; it takes a community of caring.
From a mother’s loving touch, to a
nurse’s ability to listen, or a doctor’s
insightful treatment, a local touch is
key to the best health outcomes. We
are part of the community that cares
for, and about, individuals.
We’re right here. Our employees live in
the same state as our members, drive
on the same roads, and have a vested
interest in the continued improvement
of their community. Because we’re right
here, we are better able to know the
needs of our members and achieve the
goal of better health outcomes at lower
costs. We’re right here because from
our company’s founding, we have
understood the power of showing up,
of being local, of being present. This is
more than a philosophy; it’s our
approach to everything we do. It means
that we are available for our members
when they need someone to be there;
and it means that we belong. We’re
right here.
Focus on Individuals
Whole Health
Active Local Involvement
centene corporation Annual Review 2013 15
BETTER HEALTH
OUTCOMES
The Fluvention® campaign is an initiative
aimed at educating, encouraging, and
coordinating access for annual flu
vaccinations. Using an integrated
approach, Fluvention targets individuals,
inter-personal relationships, communities,
organizations, and policies to increase
overall influenza vaccination rates.
Fluvention leverages the dynamic
relationship a member has within his
or her community to get the best
outcomes possible.
During the 2013 flu season (Q4 2012-
Q1 2013), the flu vaccination rate for all
of Centene’s health plans combined
was 22.5%, which showed a statistically
significant increase from the previous year.
FLU SEASON VACCINATION RATES ACROSS
HEALTH PLANS
25%
20%
15%
10%
5%
0%
%
5
.
2
2
%
2
.
8
1
%
6
.
9
1
%
9
.
8
1
2010
2011
2012
2013
CENTENE IN ACTION
Centene knows that social factors play a significant role in the health of our members, especially among
the children we serve. That is why Centene and Cenpatico teamed up with Children’s National Health
System in 2013 on a campaign to prevent bullying among school-aged children, which kicked off during
National Anti-Bullying Month in October. Through Centene’s established “Adopt a School” program and
other community resources, the organizations are hosting a series of events to educate students,
teachers and parents on how to prevent, identify and appropriately intervene when bullying threatens
school-aged children.
The “No Bullying Zone” events feature renowned children’s author Michelle Bain, reading a new anti-
bullying book called Splotch the Madpole which was co-authored with Centene, Cenpatico and anti-
bullying expert Dr. Joseph Wright of Children’s National Health System. In addition, students have the
opportunity to add positive messages about their family, friends and school to an anti-bullying graffiti
wall that will travel around the country for a year.
HELPING TO CREATE
HEALTHIER
COMMUNITIES
Two key components of Centene are integral to our
successes in transforming the health of our
communities, one individual at a time. Our proprietary
information technology systems and on-the-ground,
personal outreach programs jointly deliver impactful
insights and actions — helping us fulfill our purpose
every day.
INFORMATION TECHNOLOGY
Centene's Information Technology
systems provide insight into the
behaviors of our members and providers.
Through our proprietary enterprise
platform, Centelligence™, we are able
to integrate data from multiple sources,
and access actionable population and
member level information, with the
ultimate goal of improving clinical,
operational, and financial outcomes.
Centelligence integrates information
from all of our IT applications, as well
as external systems, to produce
actionable information.
Central to Centene’s clinical
management programs is TruCare, a
member-centric health management
platform for collaborative care
coordination. TruCare integrates data
from case management, behavioral
health, disease management and
utilization management processes so
our staff can look at the whole health
of the individuals we serve. The system
is critical to the collaboration between
Centene and Cenpatico in providing
integrated clinical management programs
for our high-risk members.
OUTREACH AND EDUCATION PROGRAMS
MemberConnections is face-to-face
community outreach and education
program designed to create a link
between the member and the provider.
MemberConnections representatives
contact new members to discuss
managed care, the Medicaid program
and our services. Representatives make
home visits, conduct educational
programs and represent our health
plans at community events. They
also coordinate the “Adopt a School”
program, where an award-winning
author conducts book readings in local
schools on health-related topics.
Through the ConnectionsPlus® program
members can receive access to a reliable,
preprogrammed cell phone. This program
eliminates a barrier to coordinating care
by providing continuous access to a
telephone, thus reducing avoidable events
including inappropriate emergency room
utilization, hospital admissions and
premature birth. Originally designed for
pregnant women and ABD populations,
this program has now been expanded to
serve high-risk members with mental
health issues, and specific diseases in all
of our health plans.
centene corporation Annual Review 2013 AWARDS AND
RECOGNITION
17
2013 CASE-IN-POINT PLATINUM AWARDS
2013 HERMES AWARDS (FOR BOOK SERIES)
ER Department
ED Cost Avoidance in Pediatric Medicaid
Recipients, NurseResponse
Medicaid Case Management
My Route to Health Sickle Cell Program,
Centene Corp
Pediatric Case Management
Complex Case Management in Foster Care,
Cenpatico
Women/Children Case Management
Start Smart for Your Baby, Centene Corp
Women/Children Case Management
Healthy Start Newborn & Women Program,
Peach State Health Plan
2013 WEB HEALTH AWARDS
2013 Web Health Awards
Bronze Award Winner, On Target with Your Asthma,
Audio
2013 Web Health Awards
Merit Award Winner, Listening to Your Heart,
Matters, Audio
2013 Web Health Awards
Merit Award Winner, Living Well with Sickle Cell,
Audio
2013 Web Health Awards
Merit Award Winner, Off The Chain, Audio
A Foster Care Journey
Honorable Mention
The Madpole Does A Whole Lot Of
Bullying
Platinum
Body Well, Baby Well
Gold
"Dad: Little Word, Big Deal"
Honorable Mention
Listening to Your Heart, Matters!
Platinum
Off The Chain Teen Pregnancy
Platinum
My Route to Health-On Target with
Your Asthma
Gold
START SMART FOR YOUR BABY
2013 ClearMark Merit Award Winner
Start Smart for Your Baby – A Guide to Your Baby’s
Care – The First Year
CENPATICO
2013 Greater Austin Business Awards
Higginbotham Health & Wellness Award
16K+
Home visits conducted,
including home visits for new,
high-acuity members
8.7K+
ConnectionsPlus® phones
issued to high-risk members
since program inception in
December 2006
Adopt-a-School Program
● 15 book readings with renowned
children's author Michelle Bain
● over 2,500 students reached
● 22 adopted schools as of 2013
255,691 text messages sent out
to pregnant members
QUARTERLY
SELECTED FINANCIAL
INFORMATION
FROM CONTINUING
OPERATIONS
(UNAUDITED)
(in thousands, except share data and membership data)
Total revenues
Net earnings attributable to Centene Corporation
Net earnings per share attributable to Centene Corporation:
Basic earnings per common share
Diluted earnings per common share
Health Benefits Ratio
General & Administrative Expense Ratio
Period end at-risk membership
$
$
$
$
(in thousands, except share data and membership data)
Total revenues
Net earnings (loss) attributable to Centene Corporation
Net earnings per share attributable to Centene Corporation:
Basic earnings (loss) per common share
Diluted earnings (loss) per common share
Health Benefits Ratio
General & Administrative Expense Ratio
Period end at-risk membership
$
$
$
$
For the Quarter Ended, 2013
March 31
2,525,482
22,639
0.43
0.41
90.2%
8.4%
2,553,400
June 30
September 30
December 31
$
$
$
$
$
$
$
$
2,610,538
40,289
0.74
0.71
88.4%
8.9%
2,563,400
2,795,569
50,325
0.92
0.88
87.8%
9.1%
2,612,500
$
$
$
$
2,931,740
47,965
0.87
0.84
88.1%
8.9%
2,723,200
For the Quarter Ended, 2012
March 31
1,562,809
27,072
0.53
0.51
87.1%
10.4%
2,003,800
June 30
September 30
December 31
$
$
$
$
$
$
$
$
1,967,362
(16,656
(0.32
(0.32
91.2%
8.5%
2,254,000
2,308,075
59,438
$ 2,272,050
18,679
$
1.15
1.10
88.7%
8.4%
2,357,600
$
$
0.36
0.35
90.7%
8.4%
2,424,500
centene corporation Annual Review 2013
SELECTED FINANCIAL
INFORMATION
(in thousands, except share data)
Revenues:
Premium
Service
Premium and service revenues
Premium tax
Total revenues
Expenses:
Medical costs
Cost of services
General and administrative expenses
Premium tax expense
Impairment loss
Total operating expenses
Earnings from operations
Other income (expense):
Investment and other income
Debt extinguishment costs
Interest expense
Earnings from continuing operations before
income tax expense
Income tax expense
Earnings from continuing operations, net of
income tax expense
Discontinued operations, net of income tax
19
Year Ended December 31,
2013
2012
2011
2010
2009
$ 10,153,460 $ 7,568,889 $ 4,498,137 $ 4,192,172 $ 3,786,525
91,758
3,878,283
224,581
4,102,864
103,765
5,051,902
159,575
5,211,477
91,661
4,283,833
164,490
4,448,323
372,580
10,526,040
337,289
10,863,329
112,742
7,681,631
428,665
8,110,296
8,994,641
326,924
931,137
333,210
—
10,585,912
277,417
6,781,081
87,705
667,157
428,354
28,003
8,002,330
107,966
4,191,268
78,114
577,898
160,394
—
5,007,674
203,803
3,584,452
63,919
477,765
165,118
—
4,291,254
157,069
3,230,131
60,789
447,921
225,888
—
3,964,729
138,135
18,457
—
(26,957
268,917
107,080
35,285
—
(20,460
122,791
47,412
13,355
(8,488
(20,320
188,350
70,687
15,205
—
(17,992
154,282
59,900
15,691
—
(16,318
137,508
48,841
161,837
75,379
117,663
94,382
88,667
expense (benefit) of $2,284, ($47,741), ($4,165),
$4,388, and ($1,204), respectively
Net earnings (loss)
Noncontrolling interest
Net earnings attributable to Centene Corporation $
3,881
165,718
619
165,099 $
(86,674
(11,295
(13,154
1,859 $
(9,300
108,363
(2,855
111,218 $
3,889
98,271
3,435
94,836 $
(2,422
86,245
2,574
83,671
Amounts attributable to Centene Corporation
common shareholders
Earnings from continuing operations, net of
income tax expense
Discontinued operations, net of income tax
expense (benefit)
Net earnings
Net earnings (loss) per common share
attributable to Centene Corporation:
Basic:
Continuing operations
Discontinued operations
Basic earnings per common share
Diluted:
Continuing operations
Discontinued operations
Diluted earnings per common share
Weighted average number of common shares
outstanding:
Basic
Diluted
Consolidated Balance Sheet Data From
Continuing Operations:
Cash and cash equivalents
Investments and restricted deposits
Total assests
Medical claims liability
Long term debt
Total stockholders' equity
$
161,218 $
88,533 $
120,518 $
90,947 $
86,093
3,881
165,099 $
(86,674
1,859 $
(9,300
111,218 $
3,889
94,836 $
(2,422
83,671
2.98 $
0.07
3.05 $
2.87 $
0.07
2.94 $
1.72 $
(1.68
0.04 $
1.65 $
(1.62
0.03 $
7.40 $
(0.18
2.22 $
2.30 $
(0.18
2.12 $
1.87 $
0.08
1.95 $
1.80 $
0.08
1.88 $
2.00
(0.06
1.94
1.94
(0.05
1.89
$
$
$
$
$
54,126,545
56,247,173
51,509,366
53,714,375
50,198,954
52,474,238
48,754,947
50,447,888
43,034,791
44,316,467
December 31,
2013
2012
2011
2010
2009
$
974,304 $
940,972
3,413,483
1,111,709
665,697
1,243,439
745,933 $
727,157
2,534,612
815,161
535,481
953,767
493,532 $
652,992
2,092,530
518,840
348,344
936,419
433,914 $
639,983
1,937,852
456,765
327,824
797,055
400,951
585,183
1,668,772
470,932
307,085
619,427
CORPORATE
INFORMATION
The graph below compares the cumulative total stockholder return on our common stock for the period from
December 31, 2008 to December 31, 2013 with the cumulative total return of the New York Stock Exchange
Composite Index and the Standard & Poor's Supercomposite Managed Healthcare Index over the same
period. The graph assumes an investment of $100 on December 31, 2008 in our common stock (at the last
reported sale price on such day), the New York Stock Exchange Composite Index and the Standard & Poor's
Supercomposite Managed Healthcare Index and assumes the reinvestment of any dividends. In prior years,
the Company used the Morgan Stanley Healthcare Payor Index, which was discontinued in October 2013.
Centene Corporation
New York Stock Exchange Composite Index
S&P Supercomposite Managed HealthCare Index
STOCK PERFORMANCE GRAPH
dollars
300
250
200
150
100
2008
2009
2010
2011
2012
2013
BOARD OF DIRECTORS
SENIOR MANAGEMENT
Michael F. Neidorff
Chairman, President and CEO; Centene Corporation
Michael F. Neidorff
Chairman, President and Chief Executive Officer
Orlando Ayala
Corporate Vice President, Chairman Emerging Markets,
Chief Strategist, National Competitiveness; Microsoft
Corporation
Robert K. Ditmore
Former President and COO; United Healthcare Corporation
Frederick H. Eppinger
President and CEO; The Hanover Insurance Group, Inc.
Richard A. Gephardt
Chief Executive Officer of Gephardt Group LLC;
Former Majority Leader of the U.S. House of Representatives
K. Rone Baldwin
Executive Vice President, Insurance Group Business Unit
Carol E. Goldman
Executive Vice President and Chief Administrative Officer
Jason M. Harrold
Executive Vice President, Specialty Company Business Unit
Robert T. Hitchcock
Executive Vice President, Health Plan Business Unit
Jesse N. Hunter
Executive Vice President, Chief Business Development Officer
Pamela A. Joseph
Vice Chairman; U.S. Bancorp
John R. Roberts
Retired Regional Managing Partner; Arthur Andersen LLP
David L. Steward
Founder and Chairman of the Board; World Wide
Technology, Inc.
Tommy G. Thompson
Former Health and Human Services Secretary; Former
Governor of Wisconsin
Donald G. Imholz
Executive Vice President, Operations
and Chief Information Officer
Edmund E. Kroll, Jr.
Senior Vice President, Finance and Investor Relations
C. David Minifie
Executive Vice President, Business Integration
and Chief Marketing Officer
William N. Scheffel
Executive Vice President, Chief Financial Officer and Treasurer
Jeffrey A. Schwaneke
Senior Vice President, Corporate Controller
and Chief Accounting Officer
Keith H. Williamson
Executive Vice President, General Counsel and Secretary
centene corporation Annual Review 2013 OTHER INFORMATION
TRANSFER AGENT
Included in this 2013 Annual Review are
financial and operating highlights and summary
financial statements. For complete financial
statements, including notes, please refer to the
Company’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2013 filed
with the Securities and Exchange Commission
(the “2013 Form 10-K”), which also includes
Management’s Discussion and Analysis of
Financial Condition and Results of Operations.
This 2013 Annual Review, together with our
2013 Form 10-K, constitute our annual report to
security holders for purposes of Rule 14a-3(b) of
the Securities Exchange Act of 1934, as
amended. Our 2013 Form 10-K may be obtained
by accessing the investor section of our
Company’s Web site at www.Centene.com, or
by going to the SEC’s Web site at www.sec.gov.
FORM 10-K
The Company has filed an Annual Report
on Form 10-K for the year ended December
31, 2013, with the Securities and Exchange
Commission. Stockholders may obtain a copy
of this report, without charge, by writing:
Investor Relations
Centene Corporation
7700 Forsyth Boulevard
St. Louis, MO 63105
www.centene.com
CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS
All statements, other than statements of current or historical
fact, contained in this 2013 Annual Review and, in particular, in
the Chairman’s Letter, are forward-looking statements. We have
attempted to identify these statements by terminology
including “believe,” “anticipate,” “plan,” “expect,” “estimate,”
“intend,” “seek,” “target,” “goal,” “may,” “will,” “should,”
“can,” “continue” and other similar words or expressions in
connection with, among other things, any discussion of future
operating or financial performance. In particular, these
statements include statements about our market opportunity,
our growth strategy, competition, expected activities and
future acquisitions, investments and the adequacy of our
available cash resources. Readers are cautioned that matters
subject to forward-looking statements involve known and
unknown risks and uncertainties, including economic,
regulatory, competitive and other factors that may cause our or
our industry’s actual results, levels of activity, performance or
achievements to be materially different from any future results,
levels of activity, performance or achievements expressed or
implied by these forward-looking statements. These statements
are not guarantees of future performance and are subject to
risks, uncertainties and assumptions. All forward-looking
statements included in this annual review are based on
information available to us on the date of its publication. Actual
results may differ from projections or estimates due to a
variety of important factors, including (i) competition; (ii)
Broadridge Corporate Issuer Solutions, Inc.
1717 Arch Street, Suite 1300
Philadelphia, PA 19103
855.627.5087
www.broadridge.com/TransferAgent
ANNUAL MEETING
The Annual Meeting of Stockholders will be
held on Tuesday, April 22, 2014, at 10:00 a.m.
at Centene Corporation,
7700 Forsyth Boulevard, St. Louis, MO 63105
in the Auditorium, 314.725.4477.
DIVIDEND POLICY
The Company has not paid any dividends on its
common stock and expects that its earnings will
continue to be retained for use in the operation
and expansion of its business.
COMMON STOCK INFORMATION
Centene common stock is traded and quoted
on the New York Stock Exchange under the
symbol “CNC”.
2013 Stock Price
2012 Stock Price
High
Low
High
Low
First Quarter
$ 48.55
$ 40.57
$ 50.36
$ 38.97
Second Quarter
$ 52.74
$ 42.14
$ 50.98
$ 24.26
Third Quarter
$ 65.04
$ 52.82
$ 42.46
$ 28.86
Fourth Quarter
$ 67.84
$ 54.12
$ 46.44
$ 34.73
membership and revenue projections; (iii) timing of regulatory
contract approval; (iv) changes in healthcare practices; (v)
changes in federal or state laws or regulations, including the
Patient Protection and Affordable Care Act and the Health Care
and Education Affordability Reconciliation Act and any
regulations enacted thereunder; (vi) changes in expected
contract start dates; (vii) changes in expected closing dates and
accretion for acquisitions; (viii) inflation; (ix) provider and
state contract changes; (x) new technologies; (xi) advances in
medicine; (xii) reduction in provider payments by governmental
payors; (xiii) major epidemics; (xiv) disasters and numerous
other factors affecting the delivery and cost of healthcare; (xv)
the expiration, cancellation or suspension of our Medicare or
Medicaid managed care contracts by federal or state
governments; (xvi) the outcome of pending legal proceedings;
(xvii) availability of debt and equity financing, on terms that are
favorable to us; and (xviii) general economic and market
conditions. We disclaim any current intention or obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. Due to
these important factors and risks, we cannot give assurances
with respect to our future premium levels or our ability to
control our future medical costs. Please refer to Item 1A “Risk
Factors” of Part I of the Company’s Annual Report on Form 10-K
filed with the SEC on February 21, 2014 for a further discussion
of these and other important factors that could cause actual
results to differ from expectations.
7700 Forsyth Boulevard
St. Louis, MO 63105
314.725.4477
www.centene.com
centene corporation Annual Review 2013