Humana Completes Acquisition of Metropolitan Health Networks, Inc.

  Humana Completes Acquisition of Metropolitan Health Networks, Inc.

Business Wire

LOUISVILLE, Ky. -- December 21, 2012

Humana Inc. (NYSE: HUM) today announced that it has completed its previously
announced acquisition of Metropolitan Health Networks, Inc. (NYSE: MDF) in a
transaction valued at approximately $850 million plus transaction costs.
Headquartered in Boca Raton, Florida, Metropolitan is a Medical Services
Organization that provides and coordinates medical care for approximately
87,500 Medicare Advantage, Medicaid, and other beneficiaries, primarily in
Florida utilizing a primary care-centric business model. Metropolitan’s
integrated care delivery systems include approximately 35 state-of-the-art
primary care medical centers and a robust network of affiliated physicians
serving mainly Humana members.

In connection with the closing of this transaction, Metropolitan stockholders
will receive $11.25 per share in cash from Humana for each Metropolitan share
held. Humana will also repay all of Metropolitan’s outstanding debt.

Humana has financed the transaction primarily through the recent issuance of
senior notes. The company continues to anticipate the transaction to be
modestly accretive to its earnings for the year ending December 31, 2013
(FY13). Humana expects to update its earnings guidance for FY13 to reflect the
closing of the Metropolitan acquisition in conjunction with its fourth quarter
2012 earnings release on February 4, 2013.

Cautionary Statement

This news release includes forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. When used in investor
presentations, press releases, Securities and Exchange Commission (SEC)
filings, and in oral statements made by or with the approval of one of
Humana’s executive officers, the words or phrases like “expects,”
“anticipates,” “intends,” “likely will result,” “estimates,” “projects” or
variations of such words and similar expressions are intended to identify such
forward-looking statements. These forward-looking statements are not
guarantees of future performance and are subject to risks, uncertainties, and
assumptions, including, among other things, information set forth in the “Risk
Factors” section of Humana’s SEC filings, as well as the other information
that Humana may provide with respect to the pending merger, a summary of which
includes but is not limited to the following:

  *If Humana does not design and price its products properly and
    competitively, if the premiums Humana charges are insufficient to cover
    the cost of health care services delivered to its members, if the company
    is unable to implement clinical initiatives to provide a better health
    care experience for its members, lower costs and appropriately document
    the risk profile of its members, or if its estimates of benefit expenses
    are inadequate, Humana’s profitability could be materially adversely
    affected. Humana estimates the costs of its benefit expense payments, and
    designs and prices its products accordingly, using actuarial methods and
    assumptions based upon, among other relevant factors, claim payment
    patterns, medical cost inflation, and historical developments such as
    claim inventory levels and claim receipt patterns. These estimates,
    however, involve extensive judgment, and have considerable inherent
    variability because they are extremely sensitive to changes in payment
    patterns and medical cost trends.
  *If Humana fails to effectively implement its operational and strategic
    initiatives, including its Medicare initiatives, the company’s business
    may be materially adversely affected, which is of particular importance
    given the concentration of the company’s revenues in the Medicare
  *If Humana fails to properly maintain the integrity of its data, to
    strategically implement new information systems, to protect Humana’s
    proprietary rights to its systems, or to defend against cyber-security
    attacks, the company’s business may be materially adversely affected.
  *Humana’s business may be materially adversely impacted by CMS’s adoption
    of a new coding set for diagnoses.
  *Humana is involved in various legal actions and governmental and internal
    investigations, including without limitation, an ongoing internal
    investigation and litigation and government requests for information
    related to certain aspects of its Florida subsidiary operations, any of
    which, if resolved unfavorably to the company, could result in substantial
    monetary damages. Increased litigation and negative publicity could
    increase the company’s cost of doing business.
  *As a government contractor, Humana is exposed to risks that may materially
    adversely affect its business or its willingness or ability to participate
    in government health care programs.
  *Recently enacted health insurance reform, including The Patient Protection
    and Affordable Care Act and The Health Care and Education Reconciliation
    Act of 2010, could have a material adverse effect on Humana’s results of
    operations, including restricting revenue, enrollment and premium growth
    in certain products and market segments, restricting the company’s ability
    to expand into new markets, increasing the company's medical and operating
    costs by, among other things, requiring a minimum benefit ratio on insured
    products (and particularly how the ratio may apply to Medicare plans,
    including aggregation, credibility thresholds, and its possible
    application to prescription drug plans), lowering the company’s Medicare
    payment rates and increasing the company’s expenses associated with a
    non-deductible federal premium tax and other assessments; financial
    position, including the company's ability to maintain the value of its
    goodwill; and cash flows. In addition, if the new non-deductible federal
    premium tax and other assessments, including a three-year commercial
    reinsurance fee, were imposed as enacted, and if Humana is unable to
    adjust its business model to address these new taxes and assessments, such
    as through the reduction of the company’s operating costs, there can be no
    assurance that the non-deductible federal premium tax and other
    assessments would not have a material adverse effect on the company’s
    results of operations, financial position, and cash flows.
  *Humana’s business activities are subject to substantial government
    regulation. New laws or regulations, or changes in existing laws or
    regulations or their manner of application could increase the company’s
    cost of doing business and may adversely affect the company’s business,
    profitability and cash flows.
  *Any failure to manage administrative costs could hamper Humana’s
  *Any failure by Humana to manage acquisitions and other significant
    transactions successfully may have a material adverse effect on its
    results of operations, financial position, and cash flows.
  *If Humana fails to develop and maintain satisfactory relationships with
    the providers of care to its members, the company’s business may be
    adversely affected.
  *Humana’s pharmacy business is highly competitive and subjects it to
    regulations in addition to those the company faces with its core health
    benefits businesses.
  *Changes in the prescription drug industry pricing benchmarks may adversely
    affect Humana’s financial performance.
  *If Humana does not continue to earn and retain purchase discounts and
    volume rebates from pharmaceutical manufacturers at current levels,
    Humana’s gross margins may decline.
  *Humana’s ability to obtain funds from its subsidiaries is restricted by
    state insurance regulations.
  *Downgrades in Humana’s debt ratings, should they occur, may adversely
    affect its business, results of operations, and financial condition.
  *Changes in economic conditions could adversely affect Humana’s business
    and results of operations.
  *The securities and credit markets may experience volatility and
    disruption, which may adversely affect Humana’s business.
  *Given the current economic climate, Humana’s stock and the stock of other
    companies in the insurance industry may be increasingly subject to stock
    price and trading volume volatility.

In making forward-looking statements, Humana is not undertaking to address or
update them in future filings or communications regarding its business or
results. In light of these risks, uncertainties, and assumptions, the
forward-looking events discussed herein may or may not occur. There also may
be other risks that the company is unable to predict at this time. Any of
these risks and uncertainties may cause actual results to differ materially
from the results discussed in the forward-looking statements.

Humana advises investors to read the following documents as filed by the
company with the SEC for further discussion both of the risks it faces and its
historical performance:

  *Form 10-Ks for the year ended December 31, 2011;
  *Form 10-Qs for the quarters ended March 31, 2012, June 30, 2012, and
    September 30, 2012 (as amended by the Form 10-Q/A filed on December 4,
  *Form 8-Ks filed during 2012.

About Humana

Humana Inc., headquartered in Louisville, Kentucky, is a leading health care
company that offers a wide range of insurance products and health and wellness
services that incorporate an integrated approach to lifelong well-being. By
leveraging the strengths of its core businesses, Humana believes it can better
explore opportunities for existing and emerging adjacencies in health care
that can further enhance wellness opportunities for the millions of people
across the nation with whom the company has relationships.

More information regarding Humana is available to investors via the Investor
Relations page of the company’s web site at, including copies

  *Annual reports to stockholders;
  *Securities and Exchange Commission filings;
  *Most recent investor conference presentations;
  *Quarterly earnings news releases;
  *Replays of most recent earnings release conference calls;
  *Calendar of events (including upcoming earnings conference call dates and
    times, as well as planned interaction with research analysts and
    institutional investors);
  *Corporate Governance information.

About Metropolitan

Metropolitan Health Network, Inc., a subsidiary of Humana Inc., is a growing
health care company that provides and coordinates comprehensive health care
services for Medicare Advantage, Medicaid, and other customers through its
primary care-centric businesses, MetCare of Florida, Inc., Continucare
Corporation, and Symphony Health Partners, Inc. Metropolitan currently owns
and operates approximately 35 medical centers and contracts with a network of
independent primary care practices.


Humana Investor Relations
Regina Nethery, 502-580-3644
Humana Corporate Communications
Tom Noland, 502-580-3674
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