Select Medical 10-Q 3 Aug 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Jul. 31, 2017
Document and Entity Information
Entity Registrant Name	SELECT MEDICAL HOLDINGS CORP
Entity Central Index Key	1,320,414
Document Type	10-Q
Document Period End Date	Jun. 30, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		132,936,770
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q2

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Current Assets:
Cash and cash equivalents	$ 73,799	$ 99,029
Accounts receivable, net of allowance for doubtful accounts of $63,787 and $67,769 at 2016 and 2017, respectively	714,236	573,752
Prepaid income taxes		12,423
Other current assets	83,211	77,699
Total Current Assets	871,246	762,903
Property and equipment, net	911,532	892,217
Goodwill	2,766,296	2,751,000
Identifiable intangible assets, net	335,704	340,562
Other assets	169,433	173,944
Total Assets	5,054,211	4,920,626
Current Liabilities:
Bank overdrafts	34,134	39,362
Current portion of long-term debt and notes payable	26,577	13,656
Accounts payable	123,631	126,558
Accrued payroll	119,187	146,397
Accrued vacation	92,250	83,261
Accrued interest	19,277	22,325
Accrued other	146,853	140,076
Income taxes payable	6,976
Total Current Liabilities	568,885	571,635
Long-term debt, net of current portion	2,734,132	2,685,333
Non-current deferred tax liability	197,411	199,078
Other non-current liabilities	141,279	136,520
Total Liabilities	3,641,707	3,592,566
Commitments and contingencies (Note 8)
Redeemable non-controlling interests	468,850	422,159
Stockholders' Equity:
Common stock	133	132
Capital in excess of par	454,892	443,908
Retained earnings (accumulated deficit)	393,294	371,685
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders' Equity	848,319	815,725
Non-controlling interest	95,335	90,176
Total Equity	943,654	905,901
Total Liabilities and Equity	5,054,211	4,920,626
Select Medical Corporation
Current Assets:
Cash and cash equivalents	73,799	99,029
Accounts receivable, net of allowance for doubtful accounts of $63,787 and $67,769 at 2016 and 2017, respectively	714,236	573,752
Prepaid income taxes		12,423
Other current assets	83,211	77,699
Total Current Assets	871,246	762,903
Property and equipment, net	911,532	892,217
Goodwill	2,766,296	2,751,000
Identifiable intangible assets, net	335,704	340,562
Other assets	169,433	173,944
Total Assets	5,054,211	4,920,626
Current Liabilities:
Bank overdrafts	34,134	39,362
Current portion of long-term debt and notes payable	26,577	13,656
Accounts payable	123,631	126,558
Accrued payroll	119,187	146,397
Accrued vacation	92,250	83,261
Accrued interest	19,277	22,325
Accrued other	146,853	140,076
Income taxes payable	6,976
Total Current Liabilities	568,885	571,635
Long-term debt, net of current portion	2,734,132	2,685,333
Non-current deferred tax liability	197,411	199,078
Other non-current liabilities	141,279	136,520
Total Liabilities	3,641,707	3,592,566
Commitments and contingencies (Note 8)
Redeemable non-controlling interests	468,850	422,159
Stockholders' Equity:
Common stock	0	0
Capital in excess of par	936,428	925,111
Retained earnings (accumulated deficit)	(88,109)	(109,386)
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders' Equity	848,319	815,725
Non-controlling interest	95,335	90,176
Total Equity	943,654	905,901
Total Liabilities and Equity	$ 5,054,211	$ 4,920,626

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Accounts receivable, allowance for doubtful accounts (in dollars)	$ 67,769	$ 63,787
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	700,000,000	700,000,000
Common stock, shares issued	132,929,545	132,596,758
Common stock, shares outstanding	132,929,545	132,596,758
Select Medical Corporation
Accounts receivable, allowance for doubtful accounts (in dollars)	$ 67,769	$ 63,787
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares issued	100	100
Common stock, shares outstanding	100	100

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Net operating revenues	$ 1,120,675	$ 1,097,631	$ 2,232,036	$ 2,185,961
Costs and expenses:
Cost of services	920,230	916,985	1,848,587	1,839,247
General and administrative	28,275	25,870	56,350	54,138
Bad debt expense	18,174	17,517	38,799	33,914
Depreciation and amortization	38,333	36,205	80,872	70,722
Total costs and expenses	1,005,012	996,577	2,024,608	1,998,021
Income from operations	115,663	101,054	207,428	187,940
Other income and expense:
Loss on early retirement of debt			(19,719)	(773)
Equity in earnings of unconsolidated subsidiaries	5,666	4,546	11,187	9,198
Non-operating gain (loss)		13,035	(49)	38,122
Interest expense	(37,655)	(44,332)	(78,508)	(83,180)
Income before income taxes	83,674	74,303	120,339	151,307
Income tax expense	32,374	33,450	45,576	50,510
Net income	51,300	40,853	74,763	100,797
Less: Net income attributable to non-controlling interests	9,245	6,918	16,838	12,029
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation	$ 42,055	$ 33,935	$ 57,925	$ 88,768
Basic (in dollars per share)	$ 0.32	$ 0.26	$ 0.44	$ 0.68
Diluted (in dollars per share)	$ 0.32	$ 0.26	$ 0.44	$ 0.68
Weighted average shares outstanding:
Basic (in shares)	128,624	127,626	128,544	127,563
Diluted (in shares)	128,777	127,820	128,703	127,709
Select Medical Corporation
Net operating revenues	$ 1,120,675	$ 1,097,631	$ 2,232,036	$ 2,185,961
Costs and expenses:
Cost of services	920,230	916,985	1,848,587	1,839,247
General and administrative	28,275	25,870	56,350	54,138
Bad debt expense	18,174	17,517	38,799	33,914
Depreciation and amortization	38,333	36,205	80,872	70,722
Total costs and expenses	1,005,012	996,577	2,024,608	1,998,021
Income from operations	115,663	101,054	207,428	187,940
Other income and expense:
Loss on early retirement of debt			(19,719)	(773)
Equity in earnings of unconsolidated subsidiaries	5,666	4,546	11,187	9,198
Non-operating gain (loss)		13,035	(49)	38,122
Interest expense	(37,655)	(44,332)	(78,508)	(83,180)
Income before income taxes	83,674	74,303	120,339	151,307
Income tax expense	32,374	33,450	45,576	50,510
Net income	51,300	40,853	74,763	100,797
Less: Net income attributable to non-controlling interests	9,245	6,918	16,838	12,029
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation	$ 42,055	$ 33,935	$ 57,925	$ 88,768

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Changes in Equity and Income - 6 months ended Jun. 30, 2017 - USD ($) $ in Thousands	Total Stockholders' EquitySelect Medical Corporation	Total Stockholders' Equity	Common StockSelect Medical Corporation	Common Stock	Capital in Excess of ParSelect Medical Corporation	Capital in Excess of Par	Retained EarningsSelect Medical Corporation	Retained Earnings	Non-controlling InterestsSelect Medical Corporation	Non-controlling Interests	Select Medical Corporation	Total
Balance at Dec. 31, 2016	$ 815,725	$ 815,725	$ 0	$ 132	$ 925,111	$ 443,908	$ (109,386)	$ 371,685	$ 90,176	$ 90,176	$ 905,901	$ 905,901
Balance (in shares) at Dec. 31, 2016			0	132,597,000							100	132,596,758
Increase (Decrease) in Stockholders' Equity
Net income attributable to Select Medical Holdings Corporation	57,925	57,925					57,925	57,925			$ 57,925	$ 57,925
Net income attributable to non-controlling interests									3,698	3,698	3,698	3,698
Issuance and vesting of restricted stock		8,701		$ 1		8,700						8,701
Issuance and vesting of restricted stock (in shares)				268,000
Additional investment by Holdings	963				963						963
Repurchase of common shares		(600)		$ 0		(332)		(268)				(600)
Repurchase of common shares (in shares)				(45,000)
Dividends declared and paid to Holdings	(600)						(600)				(600)
Contribution related to restricted stock awards and stock option issuances by Holdings	8,701				8,701						8,701
Exercise of stock options		963		$ 0		963						963
Exercise of stock options (in shares)				109,000
Issuance of non-controlling interests	1,653	1,653			1,653	1,653			3,634	3,634	5,287	5,287
Purchase of non-controlling interests	7	7					7	7			7	7
Distributions to non-controlling interests									(2,303)	(2,303)	(2,303)	(2,303)
Redemption adjustment on non-controlling interests	(36,292)	(36,292)					(36,292)	(36,292)			(36,292)	(36,292)
Other	237	237					237	237	130	130	367	367
Balance at Jun. 30, 2017	$ 848,319	$ 848,319	$ 0	$ 133	$ 936,428	$ 454,892	$ (88,109)	$ 393,294	$ 95,335	$ 95,335	$ 943,654	$ 943,654
Balance (in shares) at Jun. 30, 2017			0	132,929,000							100	132,929,545
Balance - Redeemable Non-controlling Interests at Dec. 31, 2016											$ 422,159	$ 422,159
Redeemable Non-controlling interests
Net income attributable to redeemable non-controlling interests											13,140	13,140
Purchase of non-controlling interests											(127)	(127)
Distributions to non-controlling interests											(3,113)	(3,113)
Redemption adjustment on non-controlling interests											36,292	36,292
Other											499	499
Balance - Redeemable Non-controlling Interests at Jun. 30, 2017											$ 468,850	$ 468,850

Condensed Consolidated Stateme6

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Operating activities
Net income	$ 74,763	$ 100,797
Adjustments to reconcile net income to net cash provided by operating activities:
Distributions from unconsolidated subsidiaries	10,933	12,039
Depreciation and amortization	80,872	70,722
Provision for bad debts	38,799	33,914
Equity in earnings of unconsolidated subsidiaries	(11,187)	(9,198)
Loss on extinguishment of debt	6,527	773
Gain on sale of assets and businesses	(9,523)	(43,461)
Loss on disposal of assets		55
Impairment of equity investment		5,339
Stock compensation expense	9,270	8,174
Amortization of debt discount, premium and issuance costs	5,974	7,077
Deferred income taxes	(1,474)	(13,286)
Changes in operating assets and liabilities, net of effects of business combinations:
Accounts receivable	(179,003)	(44,096)
Other current assets	(5,557)	11,011
Other assets	4,621	4,508
Accounts payable	759	(15,852)
Accrued expenses	(4,833)	20,632
Income taxes	19,399	29,090
Net cash provided by operating activities	40,340	178,238
Investing activities
Acquisition of businesses, net of cash acquired	(18,508)	(421,519)
Purchases of property and equipment	(105,302)	(80,258)
Investment in businesses	(9,874)	(1,590)
Proceeds from sale of assets and businesses	34,552	71,366
Net cash used in investing activities	(99,132)	(432,001)
Financing activities
Borrowings on revolving facilities	630,000	320,000
Payments on revolving facilities	(550,000)	(380,000)
Proceeds from term loans	1,139,487	600,127
Payments on term loans	(1,173,692)	(229,649)
Revolving facility debt issuance costs	(4,392)
Borrowings of other debt	9,444	22,082
Principal payments on other debt	(10,437)	(9,926)
Repayments of bank overdrafts	(5,228)	(2,138)
Repurchase of common stock	(600)	(506)
Proceeds from exercise of stock options	963	657
Proceeds from issuance of non-controlling interests	3,553	3,103
Purchase of non-controlling interests	(120)	(1,294)
Distributions to non-controlling interests	(5,416)	(4,708)
Net cash provided by financing activities	33,562	317,748
Net increase (decrease) in cash and cash equivalents	(25,230)	63,985
Cash and cash equivalents at beginning of period	99,029	14,435
Cash and cash equivalents at end of period	73,799	78,420
Supplemental Information
Cash paid for interest	76,650	69,315
Cash paid for taxes	27,626	35,518
Select Medical Corporation
Operating activities
Net income	74,763	100,797
Adjustments to reconcile net income to net cash provided by operating activities:
Distributions from unconsolidated subsidiaries	10,933	12,039
Depreciation and amortization	80,872	70,722
Provision for bad debts	38,799	33,914
Equity in earnings of unconsolidated subsidiaries	(11,187)	(9,198)
Loss on extinguishment of debt	6,527	773
Gain on sale of assets and businesses	(9,523)	(43,461)
Loss on disposal of assets		55
Impairment of equity investment		5,339
Stock compensation expense	9,270	8,174
Amortization of debt discount, premium and issuance costs	5,974	7,077
Deferred income taxes	(1,474)	(13,286)
Changes in operating assets and liabilities, net of effects of business combinations:
Accounts receivable	(179,003)	(44,096)
Other current assets	(5,557)	11,011
Other assets	4,621	4,508
Accounts payable	759	(15,852)
Accrued expenses	(4,833)	20,632
Income taxes	19,399	29,090
Net cash provided by operating activities	40,340	178,238
Investing activities
Acquisition of businesses, net of cash acquired	(18,508)	(421,519)
Purchases of property and equipment	(105,302)	(80,258)
Investment in businesses	(9,874)	(1,590)
Proceeds from sale of assets and businesses	34,552	71,366
Net cash used in investing activities	(99,132)	(432,001)
Financing activities
Borrowings on revolving facilities	630,000	320,000
Payments on revolving facilities	(550,000)	(380,000)
Proceeds from term loans	1,139,487	600,127
Payments on term loans	(1,173,692)	(229,649)
Revolving facility debt issuance costs	(4,392)
Borrowings of other debt	9,444	22,082
Principal payments on other debt	(10,437)	(9,926)
Repayments of bank overdrafts	(5,228)	(2,138)
Dividends paid to Holdings	(600)	(506)
Equity investment by Holdings	963	657
Proceeds from issuance of non-controlling interests	3,553	3,103
Purchase of non-controlling interests	(120)	(1,294)
Distributions to non-controlling interests	(5,416)	(4,708)
Net cash provided by financing activities	33,562	317,748
Net increase (decrease) in cash and cash equivalents	(25,230)	63,985
Cash and cash equivalents at beginning of period	99,029	14,435
Cash and cash equivalents at end of period	73,799	78,420
Supplemental Information
Cash paid for interest	76,650	69,315
Cash paid for taxes	$ 27,626	$ 35,518

Basis of Presentation

Basis of Presentation	6 Months Ended
	Jun. 30, 2017
Basis of Presentation
Basis of Presentation	1. Basis of Presentation The unaudited condensed consolidated financial statements of Select Medical Holdings Corporation (“Holdings”) include the accounts of its wholly owned subsidiary, Select Medical Corporation (“Select”). Holdings conducts substantially all of its business through Select and its subsidiaries. Holdings and Select and its subsidiaries are collectively referred to as the “Company.” The unaudited condensed consolidated financial statements of the Company as of June 30, 2017, and for the three and six month periods ended June 30, 2016 and 2017, have been prepared pursuant to the rules and regulations of the Securities Exchange Commission (the “SEC”) for interim reporting and accounting principles generally accepted in the United States of America (“GAAP”). Accordingly, certain information and disclosures required by GAAP, which are normally included in the notes to consolidated financial statements, have been condensed or omitted pursuant to those rules and regulations, although the Company believes the disclosure is adequate to make the information presented not misleading. In the opinion of management, such information contains all adjustments, which are normal and recurring in nature, necessary for a fair statement of the financial position, results of operations and cash flow for such periods. All significant intercompany transactions and balances have been eliminated. The results of operations for the three and six months ended June 30, 2017 are not necessarily indicative of the results to be expected for the full fiscal year ending December 31, 2017. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2016 contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 23, 2017.

Accounting Policies

Accounting Policies	6 Months Ended
	Jun. 30, 2017
Accounting Policies
Accounting Policies	2. Accounting Policies Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including disclosure of contingencies, at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Recent Accounting Pronouncements In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805), Clarifying the Definition of a Business , which clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. ASU 2017-01 states that if substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the transaction should be accounted for as an asset acquisition. In addition, the ASU clarifies the requirements for a set of activities to be considered a business and narrows the definition of an output. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill and consolidation. ASU 2017-01 is effective for annual periods beginning after December 15, 2017. Early adoption is permitted. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740), Intra-Entity Transfers of Assets Other Than Inventory. Current GAAP prohibits the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. The ASU requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The standard will be effective for fiscal years beginning after December 15, 2017. The Company plans to adopt the guidance effective January 1, 2018. Adoption of the guidance will be applied on a modified retrospective approach through a cumulative effect adjustment to retained earnings as of the effective date. In February 2016, the FASB issued ASU 2016-02, Leases . This ASU includes a lessee accounting model that recognizes two types of leases; finance and operating. This ASU requires that a lessee recognize on the balance sheet assets and liabilities for all leases with lease terms of more than twelve months. Lessees will need to recognize almost all leases on the balance sheet as a right-of-use asset and a lease liability. For income statement purposes, the FASB retained the dual model, requiring leases to be classified as either operating or finance. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will depend on its classification as a finance or operating lease. For short-term leases of twelve months or less, lessees are permitted to make an accounting election by class of underlying asset not to recognize right-of-use assets or lease liabilities. If the alternative is elected, lease expense would be recognized generally on the straight-line basis over the respective lease term. The amendments in ASU 2016-02 will take effect for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Earlier application is permitted as of the beginning of an interim or annual reporting period. A modified retrospective approach is required for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. Upon adoption, the Company will recognize significant assets and liabilities on the consolidated balance sheets as a result of the operating lease obligations of the Company. Operating lease expense will still be recognized as rent expense on a straight-line basis over the respective lease terms in the consolidated statements of operations. The Company will implement the new standard beginning January 1, 2019. The Company’s implementation efforts are focused on designing accounting processes, disclosure processes, and internal controls in order to account for its leases under the new standard. In May 2014, March 2016, April 2016, and December 2016, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , ASU 2016-08, Revenue from Contracts with Customers, Principal versus Agent Considerations , ASU 2016-10, Revenue from Contracts with Customers, Identifying Performance Obligations and Licensing , ASU 2016-12, Revenue from Contracts with Customers, Narrow Scope Improvements and Practical Expedients , and ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customer (collectively “the standards”), respectively, which supersede most of the current revenue recognition requirements. The core principle of the new guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. New disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers are also required. The standards require the selection of a retrospective or cumulative effect transition method. The Company will implement the new standard beginning January 1, 2018 using the retrospective transition method. Adoption of the new standard will result in material changes to the presentation of net operating revenues and bad debt expense in the consolidated statements of operations, but the presentation of the amount of income from operations and net income will be unchanged upon adoption of the new standards. The principal change is how the new standard requires healthcare providers to estimate the amount of variable consideration to be included in the transaction price up to an amount which is probable that a significant reversal will not occur. The most common form of variable consideration the Company experiences are amounts for services provided that are ultimately not realizable from a customer. Under the current standards, the Company’s estimate for unrealizable amounts was recorded to bad debt expense. Under the new standards, the Company’s estimate for unrealizable amounts will be recognized as a constraint to revenue and will be reflected as an allowance. Substantially all of the bad debt expense as of June 30, 2016 and June 30, 2017 will be reclassified as an allowance when the Company retrospectively applies the guidance in the standards on January 1, 2018. The Company’s remaining implementation efforts are focused principally on refining the accounting processes, disclosure processes, and internal controls. Recently Adopted Accounting Pronouncements In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes , which changed the presentation of deferred income taxes. The standard changed the presentation of deferred income taxes through the requirement that all deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The Company adopted the standard on January 1, 2017. The consolidated balance sheet at December 31, 2016 has been retrospectively adjusted. Adoption of the new standard impacted the Company’s previously reported results as follows: December 31, 2016 As Reported As Adjusted (in thousands) Current deferred tax asset $ $ — Total current assets Other assets Total assets Non-current deferred tax liability Total liabilities Total liabilities and equity Reclassifications Certain reclassifications have been made to prior year amounts in order to conform to current year presentation. As discussed above, the condensed consolidated balance sheet at December 31, 2016 has been changed in order to conform to the current year balance sheet presentation for the adoption of ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes.

Acquisitions

Acquisitions	6 Months Ended
	Jun. 30, 2017
Acquisitions
Acquisitions	3. Acquisitions Physiotherapy Acquisition On March 4, 2016, Select acquired 100% of the issued and outstanding equity securities of Physiotherapy Associates Holdings, Inc. (“Physiotherapy”) for $406.3 million, net of $12.3 million of cash acquired. For the Physiotherapy acquisition, the Company allocated the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair value in accordance with the provisions of Accounting Standards Codification (“ASC”) 805, Business Combinations . During the quarter ended March 31, 2017, the Company finalized the purchase price allocation. The following table reconciles the allocation of the consideration given for identifiable net assets and goodwill acquired to the net cash paid for the acquired business (in thousands): Cash and cash equivalents $ Identifiable tangible assets, excluding cash and cash equivalents Identifiable intangible assets Goodwill Total assets Total liabilities Acquired non-controlling interests Net assets acquired Less: Cash and cash equivalents acquired ) Net cash paid $ Goodwill of $343.2 million has been recognized in the business combination, representing the excess of the consideration given over the fair value of identifiable net assets acquired. The value of goodwill is derived from Physiotherapy’s future earnings potential and its assembled workforce. Goodwill has been assigned to the outpatient rehabilitation reporting unit and is not deductible for tax purposes. However, prior to its acquisition by the Company, Physiotherapy completed certain acquisitions that resulted in tax deductible goodwill with an estimated value of $8.8 million, which the Company will deduct through 2030. Due to the integration of Physiotherapy into our outpatient rehabilitation operations, it is not practicable to separately identify net revenue and earnings of Physiotherapy on a stand-alone basis. The following pro forma unaudited results of operations have been prepared assuming the acquisition of Physiotherapy occurred on January 1, 2015. These results are not necessarily indicative of results of future operations nor of the results that would have actually occurred had the acquisition been consummated on the aforementioned date. The Company’s results of operations for the three months ended June 30, 2016 and for the three and six months ended June 30, 2017 include Physiotherapy for the entire period. There were no pro forma adjustments during these periods; therefore, no pro forma information is presented for the periods. For the Six Months (in thousands, except per Net revenue $ Net income attributable to Holdings Income per common share: Basic $ Diluted $ The net income tax impact was calculated at a statutory rate, as if Physiotherapy had been a subsidiary of the Company as of January 1, 2015. Pro forma results for the six months ended June 30, 2016 were adjusted to exclude approximately $3.2 million of Physiotherapy acquisition costs. Other Acquisitions The Company completed acquisitions within our specialty hospitals, outpatient rehabilitation, and Concentra segments during the six months ended June 30, 2017. The Company provided total consideration of $20.2 million, consisting principally of $18.5 million of cash, net of cash received, and the issuance of non-controlling interests. The assets received in these acquisitions consisted principally of accounts receivable, property and equipment, identifiable intangible assets, and goodwill, of which $0.7 million, $0.3 million, and $14.5 million of goodwill was recognized in our specialty hospitals, outpatient rehabilitation, and Concentra reporting units, respectively.

Intangible Assets and Liabiliti

Intangible Assets and Liabilities	6 Months Ended
	Jun. 30, 2017
Intangible Assets and Liabilities
Intangible Assets and Liabilities	4. Intangible Assets and Liabilities Goodwill The following table shows changes in the carrying amount of goodwill by reporting unit for the six months ended June 30, 2017: Specialty Outpatient Concentra Total (in thousands) Balance as of December 31, 2016 $ $ $ $ Acquired Measurement period adjustment ) — ) Balance as of June 30, 2017 $ $ $ $ See Note 3 for details of the goodwill acquired during the period. Identifiable Intangible Assets and Liabilities The following table provides the gross carrying amounts, accumulated amortization, and net carrying amounts for the Company’s identifiable intangible assets and liabilities: December 31, 2016 June 30, 2017 Gross Accumulated Net Gross Accumulated Net (in thousands) Indefinite-lived assets: Trademarks $ $ — $ $ $ — $ Certificates of need — — Accreditations — — Finite-lived assets: Customer relationships ) ) Favorable leasehold interests ) ) Non-compete agreements ) ) Total identifiable intangible assets $ $ ) $ $ $ ) $ Finite-lived liabilities: Unfavorable leasehold interests $ $ ) $ $ $ ) $ The Company’s customer relationships and non-compete agreements amortize over their estimated useful lives. Amortization expense was $4.3 million for both the three months ended June 30, 2016 and 2017. Amortization expense was $8.1 million and $8.7 million for the six months ended June 30, 2016 and 2017, respectively. The Company’s favorable and unfavorable leasehold interests are amortized to rent expense over the remaining term of their respective leases to reflect a market rent per period based upon the market conditions present at the acquisition date. The Company’s unfavorable leasehold interests are not separately presented on the condensed consolidated balance sheets but are included as a component of accrued other and other non-current liabilities. The Company’s accreditations and trademarks have renewal terms and the costs to renew these intangible assets are expensed as incurred. At June 30, 2017, the accreditations and trademarks have a weighted average time until next renewal of 1.5 years and 2.4 years, respectively.

Long-Term Debt and Notes Payabl

Long-Term Debt and Notes Payable	6 Months Ended
	Jun. 30, 2017
Long-Term Debt and Notes Payable
Long-Term Debt and Notes Payable	5. Long-Term Debt and Notes Payable For purposes of this indebtedness footnote, references to Select exclude Concentra because the Concentra credit facilities are non-recourse to Holdings and Select. The Company’s long-term debt and notes payable as of June 30, 2017 are as follows (in thousands): Principal Unamortized Unamortized Carrying Fair Select: 6.375% senior notes $ $ $ ) $ $ Credit facilities: Revolving facility — — Term loan ) ) Other — — Total Select debt $ $ ) $ ) $ $ Concentra: Credit facilities: Term loan $ $ ) $ ) $ $ Other — — Total Concentra debt $ $ ) $ ) $ $ Total debt $ $ ) $ ) $ $ Principal maturities of the Company’s long-term debt and notes payable are approximately as follows (in thousands): 2017 2018 2019 2020 2021 Thereafter Total Select: 6.375% senior notes $ — $ — $ — $ — $ $ — $ Credit facilities: Revolving facility — — — — — Term loan Other Total Select debt $ $ $ $ $ $ $ Concentra: Credit facilities: Term loan $ — $ — $ — $ $ $ $ Other Total Concentra debt $ $ $ $ $ $ $ Total debt $ $ $ $ $ $ $ The Company’s long-term debt and notes payable as of December 31, 2016 are as follows (in thousands): Principal Unamortized Unamortized Carrying Fair Select: 6.375% senior notes $ $ $ ) $ $ Credit facilities: Revolving facility — — Term loans ) ) Other — — Total Select debt $ $ ) $ ) $ $ Concentra: Credit facilities: Term loan $ $ ) $ ) $ $ Other — — Total Concentra debt $ $ ) $ ) $ $ Total debt $ $ ) $ ) $ $ Select Credit Facilities On March 6, 2017, Select entered into a new senior secured credit agreement (the “Select credit agreement”) that provides for $1.6 billion in senior secured credit facilities comprising a $1.15 billion, seven-year term loan (the “Select term loan”) and a $450.0 million, five-year revolving credit facility (the “Select revolving facility” and together with the Select term loan, the “Select credit facilities”), including a $75.0 million sublimit for the issuance of standby letters of credit. Select used borrowings under the Select credit facilities to: (i) repay in full the series E tranche B term loans due June 1, 2018, the series F tranche B term loans due March 31, 2021, and the revolving facility maturing March 1, 2018 under its then existing credit facilities; and (ii) pay fees and expenses in connection with the refinancing, which resulted in $6.5 million of debt extinguishment losses and $13.2 million of debt modification losses during the first quarter of 2017. Borrowings under the Select credit facilities bear interest at a rate equal to: (i) in the case of the Select term loan, Adjusted LIBO (as defined in the Select credit agreement) plus 3.50% (subject to an Adjusted LIBO floor of 1.00%), or Alternate Base Rate (as defined in the Select credit agreement) plus 2.50% (subject to an Alternate Base Rate floor of 2.00%); and (ii) in the case of the Select revolving facility, Adjusted LIBO plus a percentage ranging from 3.00% to 3.25% or Alternate Base Rate plus a percentage ranging from 2.00% to 2.25%, in each case based on Select’s leverage ratio. The Select term loan amortizes in equal quarterly installments in amounts equal to 0.25% of the aggregate original principal amount of the Select term loan commencing on June 30, 2017. The balance of the Select term loan will be payable on March 8, 2024; however, if the Select 6.375% senior notes, which are due June 1, 2021, are outstanding on March 1, 2021, the maturity date for the Select term loan will become March 1, 2021. The Select revolving facility will be payable on March 8, 2022; however, if the Select 6.375% senior notes are outstanding on February 1, 2021, the maturity date for the Select revolving facility will become February 1, 2021. Select will be required to prepay borrowings under the Select credit facilities with (i) 100% of the net cash proceeds received from non-ordinary course asset sales or other dispositions, or as a result of a casualty or condemnation, subject to reinvestment provisions and other customary carveouts and, to the extent required, the payment of certain indebtedness secured by liens having priority over the debt under the Select credit facilities or subject to a first lien intercreditor agreement, (ii) 100% of the net cash proceeds received from the issuance of debt obligations other than certain permitted debt obligations, and (ii) 50% of excess cash flow (as defined in the Select credit agreement) if Select’s leverage ratio is greater than 4.50 to 1.00 and 25% of excess cash flow if Select’s leverage ratio is less than or equal to 4.50 to 1.00 and greater than 4.00 to 1.00, in each case, reduced by the aggregate amount of term loans, revolving loans and certain other debt optionally prepaid during the applicable fiscal year. Select will not be required to prepay borrowings with excess cash flow if Select’s leverage ratio is less than or equal to 4.00 to 1.00. The Select revolving facility requires Select to maintain a leverage ratio (as defined in the Select credit agreement), which is tested quarterly, not to exceed 6.25 to 1.00. After March 31, 2019, the leverage ratio must not exceed 6.00 to 1.00. Failure to comply with this covenant would result in an event of default under the Select revolving facility and, absent a waiver or an amendment from the revolving lenders, preclude Select from making further borrowings under the Select revolving facility and permit the revolving lenders to accelerate all outstanding borrowings under the Select revolving facility. The termination of the Select revolving facility commitments and the acceleration of amounts outstanding thereunder would constitute an event of default with respect to the Select term loan. As of June 30, 2017, Select’s leverage ratio was 5.86 to 1.00. The Select credit facilities also contain a number of other affirmative and restrictive covenants, including limitations on mergers, consolidations and dissolutions; sales of assets; investments and acquisitions; indebtedness; liens; affiliate transactions; and dividends and restricted payments. The Select credit facilities contain events of default for non-payment of principal and interest when due (subject, as to interest, to a grace period), cross-default and cross-acceleration provisions and an event of default that would be triggered by a change of control. Borrowings under the Select credit facilities are guaranteed by Holdings and substantially all of Select’s current domestic subsidiaries and will be guaranteed by substantially all of Select’s future domestic subsidiaries and secured by substantially all of Select’s existing and future property and assets and by a pledge of Select’s capital stock, the capital stock of Select’s domestic subsidiaries and up to 65% of the capital stock of Select’s foreign subsidiaries held directly by Select or a domestic subsidiary. Excess Cash Flow Payment On March 1, 2017, Concentra made a principal prepayment of $23.1 million associated with the Concentra first lien term loans in accordance with the provision in the Concentra credit facilities that requires mandatory prepayments of term loans as a result of annual excess cash flow, as defined in the Concentra credit facilities. Fair Value The Company considers the inputs in the valuation process to be Level 2 in the fair value hierarchy for Select’s 6.375% senior notes and for its credit facilities. Level 2 in the fair value hierarchy is defined as inputs that are observable for the asset or liability, either directly or indirectly, which includes quoted prices for identical assets or liabilities in markets that are not active. The fair values of the Select credit facilities and the Concentra credit facilities were based on quoted market prices for this debt in the syndicated loan market. The fair value of Select’s 6.375% senior notes was based on quoted market prices. The carrying amount of other debt, principally short-term notes payable, approximates fair value.

Segment Information

Segment Information	6 Months Ended
	Jun. 30, 2017
Segment Information
Segment Information	6. Segment Information The Company’s reportable segments consist of: specialty hospitals, outpatient rehabilitation, and Concentra. Other activities include the Company’s corporate shared services and certain other non-consolidating joint ventures and minority investments in other healthcare related businesses. The Company evaluates performance of the segments based on Adjusted EBITDA. Adjusted EBITDA is defined as earnings excluding interest, income taxes, depreciation and amortization, gain (loss) on early retirement of debt, stock compensation expense, Physiotherapy acquisition costs, non-operating gain (loss), and equity in earnings (losses) of unconsolidated subsidiaries. The following tables summarize selected financial data for the Company’s reportable segments. The segment results of Holdings are identical to those of Select. Three Months Ended June 30, Six Months Ended June 30, 2016 2017 2016 2017 (in thousands) Net operating revenues: Specialty hospitals $ $ $ $ Outpatient rehabilitation (1) Concentra Other Total Company $ $ $ $ Adjusted EBITDA: Specialty hospitals $ $ $ $ Outpatient rehabilitation (1) Concentra Other ) ) ) ) Total Company $ $ $ $ Total assets: (2) Specialty hospitals $ $ $ $ Outpatient rehabilitation Concentra Other Total Company $ $ $ $ Purchases of property and equipment, net: Specialty hospitals $ $ $ $ Outpatient rehabilitation (1) Concentra Other Total Company $ $ $ $ A reconciliation of Adjusted EBITDA to income before income taxes is as follows: Three Months Ended June 30, 2016 Specialty Outpatient (1) Concentra Other Total (in thousands) Adjusted EBITDA $ $ $ $ ) Depreciation and amortization ) ) ) ) Stock compensation expense — — ) ) Income (loss) from operations $ $ $ $ ) $ Equity in earnings of unconsolidated subsidiaries Non-operating gain Interest expense ) Income before income taxes $ Three Months Ended June 30, 2017 Specialty Outpatient Concentra Other Total (in thousands) Adjusted EBITDA $ $ $ $ ) Depreciation and amortization ) ) ) ) Stock compensation expense — — ) ) Income (loss) from operations $ $ $ $ ) $ Equity in earnings of unconsolidated subsidiaries Interest expense ) Income before income taxes $ Six Months Ended June 30, 2016 Specialty Outpatient (1) Concentra Other Total (in thousands) Adjusted EBITDA $ $ $ $ ) Depreciation and amortization ) ) ) ) Stock compensation expense — — ) ) Physiotherapy acquisition costs — — — ) Income (loss) from operations $ $ $ $ ) $ Loss on early retirement of debt ) Equity in earnings of unconsolidated subsidiaries Non-operating gain Interest expense ) Income before income taxes $ Six Months Ended June 30, 2017 Specialty Outpatient Concentra Other Total (in thousands) Adjusted EBITDA $ $ $ $ ) Depreciation and amortization ) ) ) ) Stock compensation expense — — ) ) Income (loss) from operations $ $ $ $ ) $ Loss on early retirement of debt ) Equity in earnings of unconsolidated subsidiaries Non-operating loss ) Interest expense ) Income before income taxes $ (1) The outpatient rehabilitation segment includes the operating results of the Company’s contract therapy businesses through March 31, 2016 and Physiotherapy beginning March 4, 2016. (2) Reflects the retrospective adoption of ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes. Total assets as of June 30, 2016 were retrospectively conformed to reflect the adoption of the standard, resulting in a reduction to total assets of $18.5 million.

Income per Common Share

Income per Common Share	6 Months Ended
	Jun. 30, 2017
Income per Common Share
Income per Common Share	7. Income per Common Share Holdings applies the two-class method for calculating and presenting income per common share. The two-class method is an earnings allocation formula that determines earnings per share for each class of stock participation rights in undistributed earnings. The following table sets forth the calculation of income per share in Holdings’ condensed consolidated statements of operations and the differences between basic weighted average shares outstanding and diluted weighted average shares outstanding used to compute basic and diluted earnings per share, respectively. Three Months Ended June 30, Six Months Ended June 30, 2016 2017 2016 2017 (in thousands, except per share amounts) Numerator: Net income attributable to Select Medical Holdings Corporation $ $ $ $ Less: Earnings allocated to unvested restricted stockholders Net income available to common stockholders $ $ $ $ Denominator: Weighted average shares—basic Effect of dilutive securities: Stock options Weighted average shares—diluted Basic income per common share: $ $ $ $ Diluted income per common share: $ $ $ $

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2017
Commitments and Contingencies
Commitments and Contingencies	8. Commitments and Contingencies Litigation The Company is a party to various legal actions, proceedings, and claims (some of which are not insured), and regulatory and other governmental audits and investigations in the ordinary course of its business. The Company cannot predict the ultimate outcome of pending litigation, proceedings, and regulatory and other governmental audits and investigations. These matters could potentially subject the Company to sanctions, damages, recoupments, fines, and other penalties. The Department of Justice, Centers for Medicare & Medicaid Services (“CMS”), or other federal and state enforcement and regulatory agencies may conduct additional investigations related to the Company’s businesses in the future that may, either individually or in the aggregate, have a material adverse effect on the Company’s business, financial position, results of operations, and liquidity. To address claims arising out of the Company’s operations, the Company maintains professional malpractice liability insurance and general liability insurance, subject to self-insured retention of $2.0 million per medical incident for professional liability claims and $2.0 million per occurrence for general liability claims. The Company also maintains umbrella liability insurance covering claims which, due to their nature or amount, are not covered by or not fully covered by the Company’s other insurance policies. These insurance policies also do not generally cover punitive damages and are subject to various deductibles and policy limits. Significant legal actions, as well as the cost and possible lack of available insurance, could subject the Company to substantial uninsured liabilities. In the Company’s opinion, the outcome of these actions, individually or in the aggregate, will not have a material adverse effect on its financial position, results of operations or cash flows. Healthcare providers are subject to lawsuits under the qui tam provisions of the federal False Claims Act. Qui tam lawsuits typically remain under seal (hence, usually unknown to the defendant) for some time while the government decides whether or not to intervene on behalf of a private qui tam plaintiff (known as a relator) and take the lead in the litigation. These lawsuits can involve significant monetary damages and penalties and award bounties to private plaintiffs who successfully bring the suits. The Company is and has been a defendant in these cases in the past, and may be named as a defendant in similar cases from time to time in the future. Evansville Litigation On October 19, 2015, the plaintiff-relators filed a Second Amended Complaint in United States of America, ex rel. Tracy Conroy, Pamela Schenk and Lisa Wilson v. Select Medical Corporation, Select Specialty Hospital—Evansville, LLC (“SSH-Evansville”), Select Employment Services, Inc., and Dr. Richard Sloan. The case is a civil action filed in the United States District Court for the Southern District of Indiana by private plaintiff-relators on behalf of the United States under the federal False Claims Act. The plaintiff-relators are the former CEO and two former case managers at SSH-Evansville, and the defendants currently include the Company, SSH-Evansville, a subsidiary of the Company serving as common paymaster for its employees, and a physician who practices at SSH-Evansville. The plaintiff-relators allege that SSH-Evansville discharged patients too early or held patients too long, improperly discharged patients to and readmitted them from short stay hospitals, up-coded diagnoses at admission, and admitted patients for whom long-term acute care was not medically necessary. They also allege that the defendants engaged in retaliation in violation of federal and state law. The Second Amended Complaint replaced a prior complaint that was filed under seal on September 28, 2012 and served on the Company on February 15, 2013, after a federal magistrate judge unsealed it on January 8, 2013. All deadlines in the case had been stayed after the seal was lifted in order to allow the government time to complete its investigation and to decide whether or not to intervene. On June 19, 2015, the United States Department of Justice notified the District Court of its decision not to intervene in the case. In December 2015, the defendants filed a Motion to Dismiss the Second Amended Complaint on multiple grounds, including that the action is disallowed by the False Claims Act’s public disclosure bar, which disqualifies qui tam actions that are based on fraud already publicly disclosed through enumerated sources, unless the relator is an original source, and that the plaintiff-relators did not plead their claims with sufficient particularity, as required by the Federal Rules of Civil Procedure. Thereafter, the United States filed a notice asserting a veto of the defendants’ use of the public disclosure bar for claims arising from conduct from and after March 23, 2010, which was based on certain statutory changes to the public disclosure bar language included in the Affordable Care Act. On September 30, 2016, the District Court partially granted and partially denied the defendants’ Motion to Dismiss. It ruled that the plaintiff-relators alleged substantially the same conduct as had been publicly disclosed and that the plaintiff relators are not original sources, so that the public disclosure bar requires dismissal of all non-retaliation claims arising from conduct before March 23, 2010. The District Court also ruled that the statutory changes to the public disclosure bar gave the United States the power to veto its applicability to claims arising from conduct on and after March 23, 2010, and therefore did not dismiss those claims based on the public disclosure bar. However, the District Court ruled that the plaintiff-relators did not plead certain of their claims relating to interrupted stay manipulation and premature discharging of patients with the requisite particularity, and dismissed those claims. The District Court declined to dismiss the plaintiff relators’ claims arising from conduct from and after March 23, 2010 relating to delayed discharging of patients and up-coding and the plaintiff relators’ retaliation claims. The plaintiff-relators then proposed a case management plan seeking nationwide discovery involving all of the Company’s LTCHs for the period from March 23, 2010 through the present, which the defendants have opposed. The Company intends to vigorously defend this action, but at this time the Company is unable to predict the timing and outcome of this matter. Knoxville Litigation On July 13, 2015, the United States District Court for the Eastern District of Tennessee unsealed a qui tam Complaint in Armes v. Garman, et al, No. 3:14-cv-00172-TAV-CCS, which named as defendants Select, Select Specialty Hospital—Knoxville, Inc. (“SSH-Knoxville”), Select Specialty Hospital—North Knoxville, Inc. and ten current or former employees of these facilities. The Complaint was unsealed after the United States and the State of Tennessee notified the court on July 13, 2015 that each had decided not to intervene in the case. The Complaint is a civil action that was filed under seal on April 29, 2014 by a respiratory therapist formerly employed at SSH-Knoxville. The Complaint alleges violations of the federal False Claims Act and the Tennessee Medicaid False Claims Act based on extending patient stays to increase reimbursement and to increase average length of stay; artificially prolonging the lives of patients to increase Medicare reimbursements and decrease inspections; admitting patients who do not require medically necessary care; performing unnecessary procedures and services; and delaying performance of procedures to increase billing. The Complaint was served on some of the defendants during October 2015. In November 2015, the defendants filed a Motion to Dismiss the Complaint on multiple grounds. The defendants first argued that False Claims Act’s first-to-file bar required dismissal of plaintiff-relator’s claims. Under the first-to-file bar, if a qui tam case is pending, no person may bring a related action based on the facts underlying the first action. The defendants asserted that the plaintiff-relator’s claims were based on the same underlying facts as were asserted in the Evansville litigation, discussed above. The defendants also argued that the plaintiff-relator’s claims must be dismissed under the public disclosure bar, and because the plaintiff-relator did not plead his claims with sufficient particularity. In June 2016, the District Court granted the defendants’ Motion to Dismiss and dismissed with prejudice the plaintiff-relator’s lawsuit in its entirety. The District Court ruled that the first-to-file bar precludes all but one of the plaintiff-relator’s claims, and that the remaining claim must also be dismissed because the plaintiff-relator failed to plead it with sufficient particularity. In July 2016, the plaintiff-relator filed a Notice of Appeal to the United States Court of Appeals for the Sixth Circuit. Then, on October 11, 2016, the plaintiff-relator filed a Motion to Remand the case to the District Court for further proceedings, arguing that the September 30, 2016 decision in the Evansville litigation, discussed above, undermines the basis for the District Court’s dismissal. After the Court of Appeals denied the Motion to Remand, the plaintiff-relator then sought an indicative ruling from the District Court that it would vacate its prior dismissal ruling and allow plaintiff-relator to supplement his Complaint, which the defendants have opposed. The case has been fully briefed in the Court of Appeals. The Company intends to vigorously defend this action, but at this time the Company is unable to predict the timing and outcome of this matter. Wilmington Litigation On January 19, 2017, the United States District Court for the District of Delaware unsealed a qui tam Complaint in United States of America and State of Delaware ex rel. Theresa Kelly v. Select Specialty Hospital—Wilmington, Inc. (“SSH-Wilmington”), Select Specialty Hospitals, Inc., Select Employment Services, Inc., Select Medical Corporation, and Crystal Cheek, No. 16-347-LPS. The Complaint was initially filed under seal on May 12, 2016 by a former chief nursing officer at SSH-Wilmington and was unsealed after the United States filed a Notice of Election to Decline Intervention on January 13, 2017. The corporate defendants were served on March 6, 2017. In the complaint, the plaintiff-relator alleges that the Select defendants and an individual defendant, who is a former health information manager at SSH-Wilmington, violated the False Claims Act and the Delaware False Claims and Reporting Act based on allegedly falsifying medical practitioner signatures on medical records and failing to properly examine the credentials of medical practitioners at SSH-Wilmington. In response to the Select defendants’ motion to dismiss the Complaint, on May 17, 2017 the plaintiff-relator filed an Amended Complaint asserting the same causes of action. The Select defendants filed a Motion to Dismiss the Amended Complaint, which is now pending, based on numerous grounds, including that the Amended Complaint did not plead any alleged fraud with sufficient particularity, failed to plead that the alleged fraud was material to the government’s payment decision, failed to plead sufficient facts to establish that the Select defendants knowingly submitted false claims or records, and failed to allege any reverse false claim. On March 24, 2017, the plaintiff-relator initiated a second action by filing a Complaint in the Superior Court of the State of Delaware in Theresa Kelly v. Select Medical Corporation, Select Employment Services, Inc., and SSH-Wilmington, C.A. No. N17C-03-293 CLS. The Delaware Complaint alleges that the defendants retaliated against her in violation of the Delaware Whistleblowers’ Protection Act for reporting the same alleged violations that are the subject of the federal Amended Complaint. The defendants filed a motion to dismiss, or alternatively to stay, the Delaware Complaint based on the pending federal Amended Complaint and the failure to allege facts to support a violation of the Delaware Whistleblowers’ Protection Act. The motion is currently pending. The Company intends to vigorously defend these actions, but at this time the Company is unable to predict the timing and outcome of this matter. Contract Therapy Subpoena On May 18, 2017, the Company received a subpoena from the U.S. Attorney’s Office for the District of New Jersey seeking various documents principally relating to the Company’s contract therapy division, which contracted to furnish rehabilitation therapy services to residents of skilled nursing facilities (“SNFs”) and other providers. The Company operated its contract therapy division through a subsidiary until March 31, 2016, when the Company sold the stock of the subsidiary. The subpoena seeks documents that appear to be aimed at assessing whether therapy services were furnished and billed in compliance with Medicare SNF billing requirements, including whether therapy services were coded at inappropriate levels and whether excessive or unnecessary therapy was furnished to justify coding at higher paying levels. The Company does not know whether the subpoena has been issued in connection with a qui tam lawsuit or in connection with possible civil, criminal or administrative proceedings by the government. The Company is producing documents in response to the subpoena and intends to fully cooperate with this investigation. At this time, the Company is unable to predict the timing and outcome of this matter.

Condensed Consolidating Financi

Condensed Consolidating Financial Information	6 Months Ended
	Jun. 30, 2017
Condensed Consolidating Financial Information
Condensed Consolidating Financial Information	9. Condensed Consolidating Financial Information Select’s 6.375% senior notes are fully and unconditionally and jointly and severally guaranteed, except for customary limitations, on a senior basis by all of Select’s wholly owned subsidiaries (the “Subsidiary Guarantors”). The Subsidiary Guarantors are defined as subsidiaries where Select, or a subsidiary of Select, holds all of the outstanding ownership interests. Certain of Select’s subsidiaries did not guarantee the 6.375% senior notes (the “Non-Guarantor Subsidiaries” and Concentra Group Holdings and its subsidiaries, the “Non-Guarantor Concentra”). Select conducts a significant portion of its business through its subsidiaries. Presented below is condensed consolidating financial information for Select, the Subsidiary Guarantors, the Non-Guarantor Subsidiaries, and Non-Guarantor Concentra at December 31, 2016 and June 30, 2017 and for the three and six months ended June 30, 2016 and 2017. The equity method has been used by Select with respect to investments in subsidiaries. The equity method has been used by Subsidiary Guarantors with respect to investments in Non-Guarantor Subsidiaries. Separate financial statements for Subsidiary Guarantors are not presented. Certain reclassifications have been made to prior reported amounts in order to conform to the current year guarantor structure. Select Medical Corporation Condensed Consolidating Balance Sheet June 30, 2017 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Assets Current Assets: Cash and cash equivalents $ $ $ $ $ — $ Accounts receivable, net — — Intercompany receivables — — ) (a) — Other current assets — Total Current Assets ) Property and equipment, net — Investment in affiliates — — ) (b) (c) — Goodwill — — — Identifiable intangible assets, net — — — Other assets ) (d) Total Assets $ $ $ $ $ ) $ Liabilities and Equity Current Liabilities: Bank overdrafts $ $ — $ — $ — $ — $ Current portion of long-term debt and notes payable — Accounts payable — Intercompany payables — — ) (a) — Accrued payroll — Accrued vacation — Accrued interest — Accrued other — Income taxes payable — — — Total Current Liabilities ) Long-term debt, net of current portion — Non-current deferred tax liability — ) (d) Other non-current liabilities — Total Liabilities ) Redeemable non-controlling interests — — — Stockholder’s Equity: Common stock — — — — Capital in excess of par — — — — Retained earnings (accumulated deficit) ) ) ) (c) ) Subsidiary investment — ) (b) — Total Select Medical Corporation Stockholder’s Equity ) Non-controlling interests — — — Total Equity ) Total Liabilities and Equity $ $ $ $ $ ) $ (a) Elimination of intercompany balances. (b) Elimination of investments in consolidated subsidiaries. (c) Elimination of investments in consolidated subsidiaries’ earnings. (d) Reclass of non-current deferred tax asset to report net non-current deferred tax liability in consolidation. Select Medical Corporation Condensed Consolidating Statement of Operations For the Three Months Ended June 30, 2017 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Net operating revenues $ $ $ $ $ — $ Costs and expenses: Cost of services — General and administrative — — — Bad debt expense — — Depreciation and amortization — Total costs and expenses — Income (loss) from operations ) — Other income and expense: Intercompany interest and royalty fees ) ) — — — Intercompany management fees ) ) — — — Equity in earnings of unconsolidated subsidiaries — — — Interest expense ) ) ) ) — ) Income before income taxes — Income tax expense (benefit) ) — Equity in earnings of consolidated subsidiaries — — ) (a) — Net income ) Less: Net income attributable to non-controlling interests — — — Net income attributable to Select Medical Corporation $ $ $ $ $ ) $ (a) Elimination of equity in earnings of subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Operations For the Six Months Ended June 30, 2017 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Net operating revenues $ $ $ $ $ — $ Costs and expenses: Cost of services — General and administrative — — — Bad debt expense — — Depreciation and amortization — Total costs and expenses — Income (loss) from operations ) — Other income and expense: Intercompany interest and royalty fees ) ) — — — Intercompany management fees ) ) — — — Loss on early retirement of debt ) — — — — ) Equity in earnings of unconsolidated subsidiaries — — — Non-operating loss — ) — — — ) Interest expense ) ) ) ) — ) Income (loss) before income taxes ) — Income tax expense (benefit) ) — Equity in earnings of consolidated subsidiaries — — ) (a) — Net income ) Less: Net income attributable to non-controlling interests — — — Net income attributable to Select Medical Corporation $ $ $ $ $ ) $ (a) Elimination of equity in earnings of subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Cash Flows For the Six Months Ended June 30, 2017 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Operating activities Net income $ $ $ $ $ ) (a) $ Adjustments to reconcile net income to net cash provided by (used in) operating activities: Distributions from unconsolidated subsidiaries — — — Depreciation and amortization — Provision for bad debts — — Equity in earnings of unconsolidated subsidiaries — ) ) — — ) Equity in earnings of consolidated subsidiaries ) ) — — (a) — Loss on extinguishment of debt — — — — Gain on sale of assets and businesses ) ) ) — — ) Stock compensation expense — — — Amortization of debt discount, premium and issuance costs — — — Deferred income taxes — — ) — ) Changes in operating assets and liabilities, net of effects of business combinations: Accounts receivable — ) ) ) — ) Other current assets ) ) ) — ) Other assets ) — Accounts payable ) ) ) — Accrued expenses ) ) ) — ) Income taxes — — — Net cash provided by (used in) operating activities ) — Investing activities Acquisition of businesses, net of cash acquired — ) — ) — ) Purchases of property and equipment ) ) ) ) — ) Investment in businesses — ) — — — ) Proceeds from sale of assets and businesses — — Net cash provided by (used in) investing activities ) ) ) — ) Financing activities Borrowings on revolving facilities — — — — Payments on revolving facilities ) — — — — ) Proceeds from term loans — — — — Payments on term loans ) — — ) — ) Revolving facility debt issuance costs ) — — — — ) Borrowings of other debt — — Principal payments on other debt ) ) ) ) — ) Repayments of bank overdrafts ) — — — — ) Dividends paid to Holdings ) — — — — ) Equity investment by Holdings — — — — Intercompany ) ) — — — Proceeds from issuance of non-controlling interests — — — — Purchase of non-controlling interests — — ) — — ) Distributions to non-controlling interests — — ) ) — ) Net cash provided by (used in) financing activities ) ) ) — Net decrease in cash and cash equivalents ) ) ) ) — ) Cash and cash equivalents at beginning of period — Cash and cash equivalents at end of period $ $ $ $ $ — $ (a) Elimination of equity in earnings of consolidated subsidiaries. Select Medical Corporation Condensed Consolidating Balance Sheet December 31, 2016 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Assets Current Assets: Cash and cash equivalents $ $ $ $ $ — $ Accounts receivable, net — — Intercompany receivables — — ) (a) — Prepaid income taxes — — — Other current assets — Total Current Assets ) Property and equipment, net — Investment in affiliates — — ) (b) (c) — Goodwill — — — Identifiable intangible assets, net — — — Other assets ) (d) Total Assets $ $ $ $ $ ) $ Liabilities and Equity Current Liabilities: Bank overdrafts $ $ — $ — $ — $ — $ Current portion of long-term debt and notes payable — Accounts payable — Intercompany payables — — ) (a) — Accrued payroll — Accrued vacation — Accrued interest — — — Accrued other — Total Current Liabilities ) Long-term debt, net of current portion — Non-current deferred tax liability — ) (d) Other non-current liabilities — Total Liabilities ) Redeemable non-controlling interests — — Stockholder’s Equity: Common stock — — — — Capital in excess of par — — — — Retained earnings (accumulated deficit) ) ) ) (c) ) Subsidiary investment — ) (b) — Total Select Medical Corporation Stockholder’s Equity ) Non-controlling interests — — — Total Equity ) Total Liabilities and Equity $ $ $ $ $ ) $ (a) Elimination of intercompany balances. (b) Elimination of investments in consolidated subsidiaries. (c) Elimination of investments in consolidated subsidiaries’ earnings. (d) Reclass of non-current deferred tax asset to report net non-current deferred tax liability in consolidation. Select Medical Corporation Condensed Consolidating Statement of Operations For the Three Months Ended June 30, 2016 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Net operating revenues $ $ $ $ $ — $ Costs and expenses: Cost of services — General and administrative — — — Bad debt expense — — Depreciation and amortization — Total costs and expenses — Income (loss) from operations ) — Other income and expense: Intercompany interest and royalty fees ) ) — — — Intercompany management fees ) ) — — — Equity in earnings of unconsolidated subsidiaries — — — Non-operating gain — — — Interest expense ) ) ) ) — ) Income (loss) before income taxes ) — Income tax expense (benefit) ) — Equity in earnings of consolidated subsidiaries ) — — ) (a) — Net income (loss) ) ) Less: Net income attributable to non-controlling interests — — Net income (loss) attributable to Select Medical Corporation $ $ $ ) $ $ ) $ (a) Elimination of equity in earnings of subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Operations For the Six Months Ended June 30, 2016 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Net operating revenues $ $ $ $ $ — $ Costs and expenses: Cost of services — General and administrative ) — — — Bad debt expense — — Depreciation and amortization — Total costs and expenses — Income (loss) from operations ) — Other income and expense: Intercompany interest and royalty fees ) ) — — — Intercompany management fees ) ) — — — Loss on early retirement of debt ) — — — — ) Equity in earnings of unconsolidated subsidiaries — — — Non-operating gain (loss) ) — — — Interest expense ) ) ) ) — ) Income before income taxes — Income tax expense — Equity in earnings of consolidated subsidiaries — — ) (a) — Net income ) Less: Net income attributable to non-controlling interests — — Net income attributable to Select Medical Corporation $ $ $ $ $ ) $ (a) Elimination of equity in earnings of subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Cash Flows For the Six Months Ended June 30, 2016 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Operating activities Net income $ $ $ $ $ ) (a) $ Adjustments to reconcile net income to net cash provided by (used in) operating activities: Distributions from unconsolidated subsidiaries — — — Depreciation and amortization — Provision for bad debts — — Equity in earnings of unconsolidated subsidiaries — ) ) — — ) Equity in earnings of consolidated subsidiaries ) ) — — (a) — Loss on extinguishment of debt — — — — Gain on sale of assets and businesses ) ) — — — ) Loss on disposal of assets — — Impairment of equity investment — — — — Stock compensation expense — — — Amortization of debt discount, premium and issuance costs — — Deferred income taxes — — ) — ) Changes in operating assets and liabilities, net of effects of business combinations: Accounts receivable — ) ) ) — ) Other current assets ) ) — Other assets ) ) ) — Accounts payable ) ) ) — ) Accrued expenses ) ) ) — Income taxes — — — Net cash provided by (used in) operating activities ) ) — Investing activities Acquisition of businesses, net of cash acquired ) ) ) ) — ) Purchases of property and equipment ) ) ) ) — ) Investment in businesses — ) — — — ) Proceeds from sale of assets and businesses — — Net cash used in investing activities ) ) ) ) — ) Financing activities Borrowings on revolving facilities — — — — Payments on revolving facilities ) — — ) — ) Proceeds from term loans — — — — Payments on term loans ) — — ) — ) Borrowings of other debt — — Principal payments on other debt ) ) ) ) — ) Repayments of bank overdrafts ) — — — — ) Dividends paid to Holdings ) — — — — ) Equity investment by Holdings — — — — Intercompany ) — — — Proceeds from issuance of non-controlling interests — — — — Purchase of non-controlling interests — ) — — — ) Distributions to non-controlling interests — ) ) ) — ) Net cash provided by (used in) financing activities ) ) — Net increase in cash and cash equivalents — Cash and cash equivalents at beginning of period — Cash and cash equivalents at end of period $ $ $ $ $ — $ (a) Elimination of equity in earnings of consolidated subsidiaries.

Accounting Policies (Policies)

Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2017
Accounting Policies
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including disclosure of contingencies, at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805), Clarifying the Definition of a Business , which clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. ASU 2017-01 states that if substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the transaction should be accounted for as an asset acquisition. In addition, the ASU clarifies the requirements for a set of activities to be considered a business and narrows the definition of an output. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill and consolidation. ASU 2017-01 is effective for annual periods beginning after December 15, 2017. Early adoption is permitted. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740), Intra-Entity Transfers of Assets Other Than Inventory. Current GAAP prohibits the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. The ASU requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The standard will be effective for fiscal years beginning after December 15, 2017. The Company plans to adopt the guidance effective January 1, 2018. Adoption of the guidance will be applied on a modified retrospective approach through a cumulative effect adjustment to retained earnings as of the effective date. In February 2016, the FASB issued ASU 2016-02, Leases . This ASU includes a lessee accounting model that recognizes two types of leases; finance and operating. This ASU requires that a lessee recognize on the balance sheet assets and liabilities for all leases with lease terms of more than twelve months. Lessees will need to recognize almost all leases on the balance sheet as a right-of-use asset and a lease liability. For income statement purposes, the FASB retained the dual model, requiring leases to be classified as either operating or finance. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will depend on its classification as a finance or operating lease. For short-term leases of twelve months or less, lessees are permitted to make an accounting election by class of underlying asset not to recognize right-of-use assets or lease liabilities. If the alternative is elected, lease expense would be recognized generally on the straight-line basis over the respective lease term. The amendments in ASU 2016-02 will take effect for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Earlier application is permitted as of the beginning of an interim or annual reporting period. A modified retrospective approach is required for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. Upon adoption, the Company will recognize significant assets and liabilities on the consolidated balance sheets as a result of the operating lease obligations of the Company. Operating lease expense will still be recognized as rent expense on a straight-line basis over the respective lease terms in the consolidated statements of operations. The Company will implement the new standard beginning January 1, 2019. The Company’s implementation efforts are focused on designing accounting processes, disclosure processes, and internal controls in order to account for its leases under the new standard. In May 2014, March 2016, April 2016, and December 2016, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , ASU 2016-08, Revenue from Contracts with Customers, Principal versus Agent Considerations , ASU 2016-10, Revenue from Contracts with Customers, Identifying Performance Obligations and Licensing , ASU 2016-12, Revenue from Contracts with Customers, Narrow Scope Improvements and Practical Expedients , and ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customer (collectively “the standards”), respectively, which supersede most of the current revenue recognition requirements. The core principle of the new guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. New disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers are also required. The standards require the selection of a retrospective or cumulative effect transition method. The Company will implement the new standard beginning January 1, 2018 using the retrospective transition method. Adoption of the new standard will result in material changes to the presentation of net operating revenues and bad debt expense in the consolidated statements of operations, but the presentation of the amount of income from operations and net income will be unchanged upon adoption of the new standards. The principal change is how the new standard requires healthcare providers to estimate the amount of variable consideration to be included in the transaction price up to an amount which is probable that a significant reversal will not occur. The most common form of variable consideration the Company experiences are amounts for services provided that are ultimately not realizable from a customer. Under the current standards, the Company’s estimate for unrealizable amounts was recorded to bad debt expense. Under the new standards, the Company’s estimate for unrealizable amounts will be recognized as a constraint to revenue and will be reflected as an allowance. Substantially all of the bad debt expense as of June 30, 2016 and June 30, 2017 will be reclassified as an allowance when the Company retrospectively applies the guidance in the standards on January 1, 2018. The Company’s remaining implementation efforts are focused principally on refining the accounting processes, disclosure processes, and internal controls.
Recently Adopted Accounting Pronouncements	Recently Adopted Accounting Pronouncements In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes , which changed the presentation of deferred income taxes. The standard changed the presentation of deferred income taxes through the requirement that all deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The Company adopted the standard on January 1, 2017. The consolidated balance sheet at December 31, 2016 has been retrospectively adjusted. Adoption of the new standard impacted the Company’s previously reported results as follows: December 31, 2016 As Reported As Adjusted (in thousands) Current deferred tax asset $ $ — Total current assets Other assets Total assets Non-current deferred tax liability Total liabilities Total liabilities and equity
Reclassifications	Reclassifications Certain reclassifications have been made to prior year amounts in order to conform to current year presentation. As discussed above, the condensed consolidated balance sheet at December 31, 2016 has been changed in order to conform to the current year balance sheet presentation for the adoption of ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes.

Accounting Policies (Tables)

Accounting Policies (Tables)	6 Months Ended
	Jun. 30, 2017
Accounting Policies
Schedule of adoption of the new standard impacted our previously reported results	December 31, 2016 As Reported As Adjusted (in thousands) Current deferred tax asset $ $ — Total current assets Other assets Total assets Non-current deferred tax liability Total liabilities Total liabilities and equity

Acquisitions (Tables)

Acquisitions (Tables)	6 Months Ended
	Jun. 30, 2017
Acquisitions
Schedule of pro forma unaudited results of operations	For the Six Months (in thousands, except per Net revenue $ Net income attributable to Holdings Income per common share: Basic $ Diluted $
Physiotherapy
Acquisitions
Schedule of reconciliation of the allocation of the consideration given for identifiable net assets and goodwill acquired to the net cash paid for the acquired business	The following table reconciles the allocation of the consideration given for identifiable net assets and goodwill acquired to the net cash paid for the acquired business (in thousands): Cash and cash equivalents $ Identifiable tangible assets, excluding cash and cash equivalents Identifiable intangible assets Goodwill Total assets Total liabilities Acquired non-controlling interests Net assets acquired Less: Cash and cash equivalents acquired ) Net cash paid $

Intangible Assets and Liabili19

Intangible Assets and Liabilities (Tables)	6 Months Ended
	Jun. 30, 2017
Intangible Assets and Liabilities
Schedule of changes in goodwill	Specialty Outpatient Concentra Total (in thousands) Balance as of December 31, 2016 $ $ $ $ Acquired Measurement period adjustment ) — ) Balance as of June 30, 2017 $ $ $ $
Schedule of identifiable intangible assets and liabilities	December 31, 2016 June 30, 2017 Gross Accumulated Net Gross Accumulated Net (in thousands) Indefinite-lived assets: Trademarks $ $ — $ $ $ — $ Certificates of need — — Accreditations — — Finite-lived assets: Customer relationships ) ) Favorable leasehold interests ) ) Non-compete agreements ) ) Total identifiable intangible assets $ $ ) $ $ $ ) $ Finite-lived liabilities: Unfavorable leasehold interests $ $ ) $ $ $ ) $

Long-Term Debt and Notes Paya20

Long-Term Debt and Notes Payable (Tables)	6 Months Ended
	Jun. 30, 2017
Long-Term Debt and Notes Payable
Schedule of Company's long-term debt and notes payable	The Company’s long-term debt and notes payable as of June 30, 2017 are as follows (in thousands): Principal Unamortized Unamortized Carrying Fair Select: 6.375% senior notes $ $ $ ) $ $ Credit facilities: Revolving facility — — Term loan ) ) Other — — Total Select debt $ $ ) $ ) $ $ Concentra: Credit facilities: Term loan $ $ ) $ ) $ $ Other — — Total Concentra debt $ $ ) $ ) $ $ Total debt $ $ ) $ ) $ $ The Company’s long-term debt and notes payable as of December 31, 2016 are as follows (in thousands): Principal Unamortized Unamortized Carrying Fair Select: 6.375% senior notes $ $ $ ) $ $ Credit facilities: Revolving facility — — Term loans ) ) Other — — Total Select debt $ $ ) $ ) $ $ Concentra: Credit facilities: Term loan $ $ ) $ ) $ $ Other — — Total Concentra debt $ $ ) $ ) $ $ Total debt $ $ ) $ ) $ $
Schedule of principal maturities of the Company's long-term debt and notes payable	Principal maturities of the Company’s long-term debt and notes payable are approximately as follows (in thousands): 2017 2018 2019 2020 2021 Thereafter Total Select: 6.375% senior notes $ — $ — $ — $ — $ $ — $ Credit facilities: Revolving facility — — — — — Term loan Other Total Select debt $ $ $ $ $ $ $ Concentra: Credit facilities: Term loan $ — $ — $ — $ $ $ $ Other Total Concentra debt $ $ $ $ $ $ $ Total debt $ $ $ $ $ $ $

Segment Information (Tables)

Segment Information (Tables)	6 Months Ended
	Jun. 30, 2017
Segment Information
Schedule of selected financial data for the Company's reportable segments	Three Months Ended June 30, Six Months Ended June 30, 2016 2017 2016 2017 (in thousands) Net operating revenues: Specialty hospitals $ $ $ $ Outpatient rehabilitation (1) Concentra Other Total Company $ $ $ $ Adjusted EBITDA: Specialty hospitals $ $ $ $ Outpatient rehabilitation (1) Concentra Other ) ) ) ) Total Company $ $ $ $ Total assets: (2) Specialty hospitals $ $ $ $ Outpatient rehabilitation Concentra Other Total Company $ $ $ $ Purchases of property and equipment, net: Specialty hospitals $ $ $ $ Outpatient rehabilitation (1) Concentra Other Total Company $ $ $ $
Schedule of reconciliation of Adjusted EBITDA to income before income taxes	Three Months Ended June 30, 2016 Specialty Outpatient (1) Concentra Other Total (in thousands) Adjusted EBITDA $ $ $ $ ) Depreciation and amortization ) ) ) ) Stock compensation expense — — ) ) Income (loss) from operations $ $ $ $ ) $ Equity in earnings of unconsolidated subsidiaries Non-operating gain Interest expense ) Income before income taxes $ Three Months Ended June 30, 2017 Specialty Outpatient Concentra Other Total (in thousands) Adjusted EBITDA $ $ $ $ ) Depreciation and amortization ) ) ) ) Stock compensation expense — — ) ) Income (loss) from operations $ $ $ $ ) $ Equity in earnings of unconsolidated subsidiaries Interest expense ) Income before income taxes $ Six Months Ended June 30, 2016 Specialty Outpatient (1) Concentra Other Total (in thousands) Adjusted EBITDA $ $ $ $ ) Depreciation and amortization ) ) ) ) Stock compensation expense — — ) ) Physiotherapy acquisition costs — — — ) Income (loss) from operations $ $ $ $ ) $ Loss on early retirement of debt ) Equity in earnings of unconsolidated subsidiaries Non-operating gain Interest expense ) Income before income taxes $ Six Months Ended June 30, 2017 Specialty Outpatient Concentra Other Total (in thousands) Adjusted EBITDA $ $ $ $ ) Depreciation and amortization ) ) ) ) Stock compensation expense — — ) ) Income (loss) from operations $ $ $ $ ) $ Loss on early retirement of debt ) Equity in earnings of unconsolidated subsidiaries Non-operating loss ) Interest expense ) Income before income taxes $ (1) The outpatient rehabilitation segment includes the operating results of the Company’s contract therapy businesses through March 31, 2016 and Physiotherapy beginning March 4, 2016. (2) Reflects the retrospective adoption of ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes. Total assets as of June 30, 2016 were retrospectively conformed to reflect the adoption of the standard, resulting in a reduction to total assets of $18.5 million.

Income per Common Share (Tables

Income per Common Share (Tables)	6 Months Ended
	Jun. 30, 2017
Income per Common Share
Schedule of computation of basic and diluted earnings per share	Three Months Ended June 30, Six Months Ended June 30, 2016 2017 2016 2017 (in thousands, except per share amounts) Numerator: Net income attributable to Select Medical Holdings Corporation $ $ $ $ Less: Earnings allocated to unvested restricted stockholders Net income available to common stockholders $ $ $ $ Denominator: Weighted average shares—basic Effect of dilutive securities: Stock options Weighted average shares—diluted Basic income per common share: $ $ $ $ Diluted income per common share: $ $ $ $

Condensed Consolidating Finan23

Condensed Consolidating Financial Information (Tables) - Select Medical Corporation	6 Months Ended
	Jun. 30, 2017
Schedule of Condensed Consolidating Balance Sheet	Select Medical Corporation Condensed Consolidating Balance Sheet June 30, 2017 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Assets Current Assets: Cash and cash equivalents $ $ $ $ $ — $ Accounts receivable, net — — Intercompany receivables — — ) (a) — Other current assets — Total Current Assets ) Property and equipment, net — Investment in affiliates — — ) (b) (c) — Goodwill — — — Identifiable intangible assets, net — — — Other assets ) (d) Total Assets $ $ $ $ $ ) $ Liabilities and Equity Current Liabilities: Bank overdrafts $ $ — $ — $ — $ — $ Current portion of long-term debt and notes payable — Accounts payable — Intercompany payables — — ) (a) — Accrued payroll — Accrued vacation — Accrued interest — Accrued other — Income taxes payable — — — Total Current Liabilities ) Long-term debt, net of current portion — Non-current deferred tax liability — ) (d) Other non-current liabilities — Total Liabilities ) Redeemable non-controlling interests — — — Stockholder’s Equity: Common stock — — — — Capital in excess of par — — — — Retained earnings (accumulated deficit) ) ) ) (c) ) Subsidiary investment — ) (b) — Total Select Medical Corporation Stockholder’s Equity ) Non-controlling interests — — — Total Equity ) Total Liabilities and Equity $ $ $ $ $ ) $ (a) Elimination of intercompany balances. (b) Elimination of investments in consolidated subsidiaries. (c) Elimination of investments in consolidated subsidiaries’ earnings. (d) Reclass of non-current deferred tax asset to report net non-current deferred tax liability in consolidation. Select Medical Corporation Condensed Consolidating Balance Sheet December 31, 2016 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Assets Current Assets: Cash and cash equivalents $ $ $ $ $ — $ Accounts receivable, net — — Intercompany receivables — — ) (a) — Prepaid income taxes — — — Other current assets — Total Current Assets ) Property and equipment, net — Investment in affiliates — — ) (b) (c) — Goodwill — — — Identifiable intangible assets, net — — — Other assets ) (d) Total Assets $ $ $ $ $ ) $ Liabilities and Equity Current Liabilities: Bank overdrafts $ $ — $ — $ — $ — $ Current portion of long-term debt and notes payable — Accounts payable — Intercompany payables — — ) (a) — Accrued payroll — Accrued vacation — Accrued interest — — — Accrued other — Total Current Liabilities ) Long-term debt, net of current portion — Non-current deferred tax liability — ) (d) Other non-current liabilities — Total Liabilities ) Redeemable non-controlling interests — — Stockholder’s Equity: Common stock — — — — Capital in excess of par — — — — Retained earnings (accumulated deficit) ) ) ) (c) ) Subsidiary investment — ) (b) — Total Select Medical Corporation Stockholder’s Equity ) Non-controlling interests — — — Total Equity ) Total Liabilities and Equity $ $ $ $ $ ) $ (a) Elimination of intercompany balances. (b) Elimination of investments in consolidated subsidiaries. (c) Elimination of investments in consolidated subsidiaries’ earnings. (d) Reclass of non-current deferred tax asset to report net non-current deferred tax liability in consolidation.
Schedule of Condensed Consolidating Statement of Operations	Select Medical Corporation Condensed Consolidating Statement of Operations For the Three Months Ended June 30, 2017 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Net operating revenues $ $ $ $ $ — $ Costs and expenses: Cost of services — General and administrative — — — Bad debt expense — — Depreciation and amortization — Total costs and expenses — Income (loss) from operations ) — Other income and expense: Intercompany interest and royalty fees ) ) — — — Intercompany management fees ) ) — — — Equity in earnings of unconsolidated subsidiaries — — — Interest expense ) ) ) ) — ) Income before income taxes — Income tax expense (benefit) ) — Equity in earnings of consolidated subsidiaries — — ) (a) — Net income ) Less: Net income attributable to non-controlling interests — — — Net income attributable to Select Medical Corporation $ $ $ $ $ ) $ (a) Elimination of equity in earnings of subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Operations For the Six Months Ended June 30, 2017 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Net operating revenues $ $ $ $ $ — $ Costs and expenses: Cost of services — General and administrative — — — Bad debt expense — — Depreciation and amortization — Total costs and expenses — Income (loss) from operations ) — Other income and expense: Intercompany interest and royalty fees ) ) — — — Intercompany management fees ) ) — — — Loss on early retirement of debt ) — — — — ) Equity in earnings of unconsolidated subsidiaries — — — Non-operating loss — ) — — — ) Interest expense ) ) ) ) — ) Income (loss) before income taxes ) — Income tax expense (benefit) ) — Equity in earnings of consolidated subsidiaries — — ) (a) — Net income ) Less: Net income attributable to non-controlling interests — — — Net income attributable to Select Medical Corporation $ $ $ $ $ ) $ (a) Elimination of equity in earnings of subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Operations For the Three Months Ended June 30, 2016 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Net operating revenues $ $ $ $ $ — $ Costs and expenses: Cost of services — General and administrative — — — Bad debt expense — — Depreciation and amortization — Total costs and expenses — Income (loss) from operations ) — Other income and expense: Intercompany interest and royalty fees ) ) — — — Intercompany management fees ) ) — — — Equity in earnings of unconsolidated subsidiaries — — — Non-operating gain — — — Interest expense ) ) ) ) — ) Income (loss) before income taxes ) — Income tax expense (benefit) ) — Equity in earnings of consolidated subsidiaries ) — — ) (a) — Net income (loss) ) ) Less: Net income attributable to non-controlling interests — — Net income (loss) attributable to Select Medical Corporation $ $ $ ) $ $ ) $ (a) Elimination of equity in earnings of subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Operations For the Six Months Ended June 30, 2016 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Net operating revenues $ $ $ $ $ — $ Costs and expenses: Cost of services — General and administrative ) — — — Bad debt expense — — Depreciation and amortization — Total costs and expenses — Income (loss) from operations ) — Other income and expense: Intercompany interest and royalty fees ) ) — — — Intercompany management fees ) ) — — — Loss on early retirement of debt ) — — — — ) Equity in earnings of unconsolidated subsidiaries — — — Non-operating gain (loss) ) — — — Interest expense ) ) ) ) — ) Income before income taxes — Income tax expense — Equity in earnings of consolidated subsidiaries — — ) (a) — Net income ) Less: Net income attributable to non-controlling interests — — Net income attributable to Select Medical Corporation $ $ $ $ $ ) $ (a) Elimination of equity in earnings of subsidiaries.
Schedule of Condensed Consolidating Statement of Cash Flows	Select Medical Corporation Condensed Consolidating Statement of Cash Flows For the Six Months Ended June 30, 2017 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Operating activities Net income $ $ $ $ $ ) (a) $ Adjustments to reconcile net income to net cash provided by (used in) operating activities: Distributions from unconsolidated subsidiaries — — — Depreciation and amortization — Provision for bad debts — — Equity in earnings of unconsolidated subsidiaries — ) ) — — ) Equity in earnings of consolidated subsidiaries ) ) — — (a) — Loss on extinguishment of debt — — — — Gain on sale of assets and businesses ) ) ) — — ) Stock compensation expense — — — Amortization of debt discount, premium and issuance costs — — — Deferred income taxes — — ) — ) Changes in operating assets and liabilities, net of effects of business combinations: Accounts receivable — ) ) ) — ) Other current assets ) ) ) — ) Other assets ) — Accounts payable ) ) ) — Accrued expenses ) ) ) — ) Income taxes — — — Net cash provided by (used in) operating activities ) — Investing activities Acquisition of businesses, net of cash acquired — ) — ) — ) Purchases of property and equipment ) ) ) ) — ) Investment in businesses — ) — — — ) Proceeds from sale of assets and businesses — — Net cash provided by (used in) investing activities ) ) ) — ) Financing activities Borrowings on revolving facilities — — — — Payments on revolving facilities ) — — — — ) Proceeds from term loans — — — — Payments on term loans ) — — ) — ) Revolving facility debt issuance costs ) — — — — ) Borrowings of other debt — — Principal payments on other debt ) ) ) ) — ) Repayments of bank overdrafts ) — — — — ) Dividends paid to Holdings ) — — — — ) Equity investment by Holdings — — — — Intercompany ) ) — — — Proceeds from issuance of non-controlling interests — — — — Purchase of non-controlling interests — — ) — — ) Distributions to non-controlling interests — — ) ) — ) Net cash provided by (used in) financing activities ) ) ) — Net decrease in cash and cash equivalents ) ) ) ) — ) Cash and cash equivalents at beginning of period — Cash and cash equivalents at end of period $ $ $ $ $ — $ (a) Elimination of equity in earnings of consolidated subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Cash Flows For the Six Months Ended June 30, 2016 (unaudited) Select (Parent Subsidiary Non-Guarantor Non-Guarantor Eliminations Consolidated (in thousands) Operating activities Net income $ $ $ $ $ ) (a) $ Adjustments to reconcile net income to net cash provided by (used in) operating activities: Distributions from unconsolidated subsidiaries — — — Depreciation and amortization — Provision for bad debts — — Equity in earnings of unconsolidated subsidiaries — ) ) — — ) Equity in earnings of consolidated subsidiaries ) ) — — (a) — Loss on extinguishment of debt — — — — Gain on sale of assets and businesses ) ) — — — ) Loss on disposal of assets — — Impairment of equity investment — — — — Stock compensation expense — — — Amortization of debt discount, premium and issuance costs — — Deferred income taxes — — ) — ) Changes in operating assets and liabilities, net of effects of business combinations: Accounts receivable — ) ) ) — ) Other current assets ) ) — Other assets ) ) ) — Accounts payable ) ) ) — ) Accrued expenses ) ) ) — Income taxes — — — Net cash provided by (used in) operating activities ) ) — Investing activities Acquisition of businesses, net of cash acquired ) ) ) ) — ) Purchases of property and equipment ) ) ) ) — ) Investment in businesses — ) — — — ) Proceeds from sale of assets and businesses — — Net cash used in investing activities ) ) ) ) — ) Financing activities Borrowings on revolving facilities — — — — Payments on revolving facilities ) — — ) — ) Proceeds from term loans — — — — Payments on term loans ) — — ) — ) Borrowings of other debt — — Principal payments on other debt ) ) ) ) — ) Repayments of bank overdrafts ) — — — — ) Dividends paid to Holdings ) — — — — ) Equity investment by Holdings — — — — Intercompany ) — — — Proceeds from issuance of non-controlling interests — — — — Purchase of non-controlling interests — ) — — — ) Distributions to non-controlling interests — ) ) ) — ) Net cash provided by (used in) financing activities ) ) — Net increase in cash and cash equivalents — Cash and cash equivalents at beginning of period — Cash and cash equivalents at end of period $ $ $ $ $ — $ (a) Elimination of equity in earnings of consolidated subsidiaries.

Accounting Policies (Details)

Accounting Policies (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Recently Adopted Accounting Pronouncements
Total current assets	$ 871,246	$ 762,903
Other assets	169,433	173,944
Total assets	5,054,211	4,920,626	$ 4,819,889
Non-current deferred tax liability	197,411	199,078
Total liabilities	3,641,707	3,592,566
Total liabilities and equity	$ 5,054,211	4,920,626
ASU 2015-17
Recently Adopted Accounting Pronouncements
Total current assets		762,903
Other assets		173,944
Total assets		4,920,626
Non-current deferred tax liability		199,078
Total liabilities		3,592,566
Total liabilities and equity		4,920,626
As Reported | ASU 2015-17
Recently Adopted Accounting Pronouncements
Current deferred tax asset		45,165
Total current assets		808,068
Other assets		152,548
Total assets		4,944,395
Non-current deferred tax liability		222,847
Total liabilities		3,616,335
Total liabilities and equity		$ 4,944,395

Acquisitions - Physiotherapy Ac

Acquisitions - Physiotherapy Acquisition (Details) - USD ($) $ in Thousands	Mar. 04, 2016	Mar. 31, 2017	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016	Mar. 03, 2016
Consideration given for identifiable net assets and goodwill acquired to the net cash paid
Goodwill			$ 2,766,296		$ 2,751,000
Net cash paid			$ 18,508	$ 421,519
Physiotherapy
Acquisitions
Voting equity interests acquired	100.00%
Consideration given for identifiable net assets and goodwill acquired to the net cash paid
Cash and cash equivalents	$ 12,300	$ 12,340
Identifiable tangible assets, excluding cash and cash equivalents		87,832
Identifiable intangible assets		32,484
Goodwill		343,187
Total assets		475,843
Total liabilities		54,685
Acquired non-controlling interests		2,514
Net assets acquired		418,644
Net cash paid	$ 406,300	$ 406,304
Estimated value of goodwill, deductible for tax purposes						$ 8,800

Acquisitions - Proforma Results

Acquisitions - Proforma Results and Other Acquisitions (Details) - USD ($) $ / shares in Units, $ in Thousands	Mar. 04, 2016	Mar. 31, 2017	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Acquisitions
Net cash paid			$ 18,508	$ 421,519
Goodwill			2,766,296		$ 2,751,000
Pro Forma
Pro forma results of operations
Net revenue				2,239,491
Net income attributable to Holdings				$ 86,948
Income per common share:
Basic (in dollars per share)				$ 0.66
Diluted (in dollars per share)				$ 0.66
Specialty Hospitals
Acquisitions
Goodwill			1,447,718		1,447,406
Outpatient Rehabilitation
Acquisitions
Goodwill			644,036		643,557
Concentra
Acquisitions
Goodwill			674,542		$ 660,037
Physiotherapy
Acquisitions
Net cash paid	$ 406,300	$ 406,304
Goodwill		$ 343,187
Physiotherapy | Pro Forma
Proforma acquisition costs
Acquisition costs excluded from proforma results				$ 3,200
Other Acquisitions
Acquisitions
Total consideration (net of cash acquired)			20,200
Net cash paid			18,500
Other Acquisitions | Specialty Hospitals
Acquisitions
Goodwill			700
Other Acquisitions | Outpatient Rehabilitation
Acquisitions
Goodwill			300
Other Acquisitions | Concentra
Acquisitions
Goodwill			$ 14,500

Intangible Assets and Liabili27

Intangible Assets and Liabilities - Changes in the Carrying Amount of Goodwill (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2017USD ($)
Goodwill
Balance at the beginning of the period	$ 2,751,000
Acquired	15,470
Measurement period adjustment	(174)
Balance at the end of the period	2,766,296
Specialty Hospitals
Goodwill
Balance at the beginning of the period	1,447,406
Acquired	654
Measurement period adjustment	(342)
Balance at the end of the period	1,447,718
Outpatient Rehabilitation
Goodwill
Balance at the beginning of the period	643,557
Acquired	311
Measurement period adjustment	168
Balance at the end of the period	644,036
Concentra
Goodwill
Balance at the beginning of the period	660,037
Acquired	14,505
Balance at the end of the period	$ 674,542

Intangible Assets and Liabili28

Intangible Assets and Liabilities - Identifiable Intangible Assets and Liabilities (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Finite-lived assets:
Accumulated Amortization	$ (36,790)		$ (36,790)		$ (27,339)
Total identifiable intangible assets, Gross Carrying Amount	372,494		372,494		367,901
Total identifiable intangible assets, Net (Excluding Goodwill), Total	335,704		335,704		340,562
Identifiable intangibles-Finite lived liabilities:
Unfavorable leasehold interests, Gross Carrying Amount	5,343		5,343		5,139
Unfavorable leasehold interests, Accumulated Amortization	(1,957)		(1,957)		(1,410)
Unfavorable leasehold interests, Net Carrying Amount	3,386		3,386		3,729
Customer relationships
Finite-lived assets:
Identifiable intangibles - Finite lived assets, Gross Carrying Amount	143,953		143,953		142,198
Accumulated Amortization	(30,681)		(30,681)		(23,185)
Identifiable intangibles - Finite lived assets, Net Carrying Amount	113,272		113,272		119,013
Favorable leasehold interests
Finite-lived assets:
Identifiable intangibles - Finite lived assets, Gross Carrying Amount	13,295		13,295		13,089
Accumulated Amortization	(3,255)		(3,255)		(2,317)
Identifiable intangibles - Finite lived assets, Net Carrying Amount	10,040		10,040		10,772
Non-compete agreements
Finite-lived assets:
Identifiable intangibles - Finite lived assets, Gross Carrying Amount	27,267		27,267		26,655
Accumulated Amortization	(2,854)		(2,854)		(1,837)
Identifiable intangibles - Finite lived assets, Net Carrying Amount	24,413		24,413		24,818
Customer relationships and non-compete agreements
Finite-lived assets:
Amortization expense	4,300	$ 4,300	$ 8,700	$ 8,100
Trademarks
Identifiable Intangible Assets and Liabilities
Weighted average time until next renewal			2 years 4 months 24 days
Indefinite-lived assets:
Identifiable intangibles - Indefinite lived assets	166,698		$ 166,698		166,698
Certificates of need
Indefinite-lived assets:
Identifiable intangibles - Indefinite lived assets	19,207		$ 19,207		17,026
Accreditations
Identifiable Intangible Assets and Liabilities
Weighted average time until next renewal			1 year 6 months
Indefinite-lived assets:
Identifiable intangibles - Indefinite lived assets	$ 2,074		$ 2,074		$ 2,235

Long-Term Debt and Notes Paya29

Long-Term Debt and Notes Payable - Components of Long-Term Debt And Notes Payable (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Long-term debt and notes payable
Principal Outstanding	$ 2,808,727	$ 2,747,856
Unamortized Premium (Discount)	(15,101)	(13,734)
Unamortized Issuance Costs	(32,917)	(35,133)
Carrying Value	2,760,709	2,698,989
Fair Value	2,816,609	2,752,974
Select Excluding Concentra
Long-term debt and notes payable
Principal Outstanding	2,182,825	2,100,439
Unamortized Premium (Discount)	(12,588)	(10,961)
Unamortized Issuance Costs	(21,050)	(22,042)
Carrying Value	2,149,187	2,067,436
Fair Value	$ 2,192,448	2,103,148
Select Excluding Concentra | 6.375% senior notes
Long-term debt and notes payable
Interest rate of debt (as a percent)	6.375%
Principal Outstanding	$ 710,000	710,000
Unamortized Premium (Discount)	892	1,006
Unamortized Issuance Costs	(7,510)	(8,461)
Carrying Value	703,382	702,545
Fair Value	732,152	710,000
Select Excluding Concentra | Revolving facility
Long-term debt and notes payable
Principal Outstanding	300,000	220,000
Carrying Value	300,000	220,000
Fair Value	276,000	204,600
Select Excluding Concentra | Term loan
Long-term debt and notes payable
Principal Outstanding	1,147,125	1,147,751
Unamortized Premium (Discount)	(13,480)	(11,967)
Unamortized Issuance Costs	(13,540)	(13,581)
Carrying Value	1,120,105	1,122,203
Fair Value	1,158,596	1,165,860
Select Excluding Concentra | Other
Long-term debt and notes payable
Principal Outstanding	25,700	22,688
Carrying Value	25,700	22,688
Fair Value	25,700	22,688
Concentra Inc
Long-term debt and notes payable
Principal Outstanding	625,902	647,417
Unamortized Premium (Discount)	(2,513)	(2,773)
Unamortized Issuance Costs	(11,867)	(13,091)
Carrying Value	611,522	631,553
Fair Value	624,161	649,826
Concentra Inc | Term loan
Long-term debt and notes payable
Principal Outstanding	619,175	642,239
Unamortized Premium (Discount)	(2,513)	(2,773)
Unamortized Issuance Costs	(11,867)	(13,091)
Carrying Value	604,795	626,375
Fair Value	617,434	644,648
Concentra Inc | Other
Long-term debt and notes payable
Principal Outstanding	6,727	5,178
Carrying Value	6,727	5,178
Fair Value	$ 6,727	$ 5,178

Long-Term Debt and Notes Paya30

Long-Term Debt and Notes Payable - Maturities Of Long-Term Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Long-term debt and notes payable
2,017	$ 17,310
2,018	16,424
2,019	23,471
2,020	14,745
2,021	728,194
Thereafter	2,008,583
Total	2,808,727	$ 2,747,856
Select Excluding Concentra
Long-term debt and notes payable
2,017	16,001
2,018	15,030
2,019	23,327
2,020	11,568
2,021	721,514
Thereafter	1,395,385
Total	$ 2,182,825	2,100,439
Select Excluding Concentra | 6.375% senior notes
Long-term debt and notes payable
Interest rate of debt (as a percent)	6.375%
2,021	$ 710,000
Total	710,000	710,000
Select Excluding Concentra | Revolving facility
Long-term debt and notes payable
Thereafter	300,000
Total	300,000	220,000
Select Excluding Concentra | Term loan
Long-term debt and notes payable
2,017	5,750
2,018	11,500
2,019	11,500
2,020	11,500
2,021	11,500
Thereafter	1,095,375
Total	1,147,125	1,147,751
Select Excluding Concentra | Other
Long-term debt and notes payable
2,017	10,251
2,018	3,530
2,019	11,827
2,020	68
2,021	14
Thereafter	10
Total	25,700	22,688
Concentra Inc
Long-term debt and notes payable
2,017	1,309
2,018	1,394
2,019	144
2,020	3,177
2,021	6,680
Thereafter	613,198
Total	625,902	647,417
Concentra Inc | Term loan
Long-term debt and notes payable
2,020	3,016
2,021	6,520
Thereafter	609,639
Total	619,175	642,239
Concentra Inc | Other
Long-term debt and notes payable
2,017	1,309
2,018	1,394
2,019	144
2,020	161
2,021	160
Thereafter	3,559
Total	$ 6,727	$ 5,178
Select Medical Corporation | 6.375% senior notes
Long-term debt and notes payable
Interest rate of debt (as a percent)	6.375%

Long-Term Debt and Notes Paya31

Long-Term Debt and Notes Payable - Select Credit Facilities (Details) $ in Thousands	Apr. 01, 2019	Jun. 30, 2017	Mar. 06, 2017USD ($)	Mar. 31, 2017USD ($)	Jun. 30, 2017USD ($)	Jun. 30, 2016USD ($)
Long-term debt and notes payable
Loss on extinguishment of debt					$ 6,527	$ 773
Select Medical Corporation
Long-term debt and notes payable
Loss on extinguishment of debt					$ 6,527	$ 773
Capital stock of foreign subsidiaries pledged (as a percent)			65.00%
Select Medical Corporation | Credit agreement
Long-term debt and notes payable
Current borrowing capacity			$ 1,600,000
Loss on extinguishment of debt				$ 6,500
Debt modification losses				$ 13,200
Percentage of net cash proceeds received from non-ordinary course asset sales or other dispositions, or as a result of a casualty or condemnation to be used for prepayment of debt			100.00%
Percentage of net proceeds received from the issuance of debt obligations other than certain permitted debt obligations to be used for prepayment of debt			100.00%
Leverage ratio of financial maintenance covenant		5.86
Select Medical Corporation | Credit agreement | Leverage ratio greater than 4.50 to 1.00
Long-term debt and notes payable
Percentage of excess cash flow to be used for prepayment of debt			50.00%
Leverage ratio of financial maintenance covenant			4.50
Select Medical Corporation | Credit agreement | Leverage ratio less than or equal to 4.50 to 1.00 and greater than 4.00 to 1.00
Long-term debt and notes payable
Percentage of excess cash flow to be used for prepayment of debt			25.00%
Leverage ratio of financial maintenance covenant			4
Select Medical Corporation | Credit agreement | Leverage ratio less than 6.25 to 1.00
Long-term debt and notes payable
Leverage ratio of financial maintenance covenant			6.25
Select Medical Corporation | Credit agreement | Future leverage ratio less than 6.00 to 1.00
Long-term debt and notes payable
Leverage ratio of financial maintenance covenant	6
Select Medical Corporation | Credit agreement | Term loan
Long-term debt and notes payable
Aggregate principal amount			$ 1,150,000
Debt instrument term (in years)			7 years
Percentage of amortization of term loan			0.25%
Select Medical Corporation | Credit agreement | Term loan | Adjusted LIBO
Long-term debt and notes payable
Interest rate margin (as a percent)			3.50%
Select Medical Corporation | Credit agreement | Term loan | Alternate Base Rate
Long-term debt and notes payable
Interest rate margin (as a percent)			2.50%
Select Medical Corporation | Credit agreement | Term loan | Alternate Base Rate floor
Long-term debt and notes payable
Interest rate margin (as a percent)			2.00%
Select Medical Corporation | Credit agreement | Term loan | Adjusted LIBO Rate floor
Long-term debt and notes payable
Interest rate margin (as a percent)			1.00%
Select Medical Corporation | Credit agreement | Revolving facility
Long-term debt and notes payable
Current borrowing capacity			$ 450,000
Debt instrument term (in years)			5 years
Select Medical Corporation | Credit agreement | Revolving facility | Adjusted LIBO | Minimum
Long-term debt and notes payable
Interest rate margin (as a percent)			3.00%
Select Medical Corporation | Credit agreement | Revolving facility | Adjusted LIBO | Maximum
Long-term debt and notes payable
Interest rate margin (as a percent)			3.25%
Select Medical Corporation | Credit agreement | Revolving facility | Alternate Base Rate | Minimum
Long-term debt and notes payable
Interest rate margin (as a percent)			2.00%
Select Medical Corporation | Credit agreement | Revolving facility | Alternate Base Rate | Maximum
Long-term debt and notes payable
Interest rate margin (as a percent)			2.25%
Select Medical Corporation | Credit agreement | Standby letter of credit
Long-term debt and notes payable
Current borrowing capacity			$ 75,000

Long-Term Debt and Notes Paya32

Long-Term Debt and Notes Payable - Loss on Early Retirement of Debt and Excess Cash Flow Payment (Details) $ in Millions	Mar. 01, 2017USD ($)
Select Medical Corporation | First Lien Credit Agreement - Term Loan
Long-term debt and notes payable
Principal prepayments from excess cash flow	$ 23.1

Segment Information - Selected

Segment Information - Selected Financial Data (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Segment information
Net operating revenues	$ 1,120,675	$ 1,097,631	$ 2,232,036	$ 2,185,961
Adjusted EBITDA	158,680	141,457	297,570	270,072
Total assets	5,054,211	4,819,889	5,054,211	4,819,889	$ 4,920,626
Purchases of property and equipment, net	54,649	33,490	105,302	80,258
Operating Segments | Specialty Hospitals
Segment information
Net operating revenues	600,960	585,816	1,199,747	1,184,770
Adjusted EBITDA	98,172	82,739	186,837	169,495
Total assets	2,655,617	2,457,948	2,655,617	2,457,948
Purchases of property and equipment, net	36,691	21,313	69,048	54,988
Operating Segments | Outpatient Rehabilitation
Segment information
Net operating revenues	258,106	256,928	513,923	495,010
Adjusted EBITDA	41,926	38,132	73,277	67,011
Total assets	982,811	959,748	982,811	959,748
Purchases of property and equipment, net	6,201	3,825	12,874	8,798
Operating Segments | Concentra
Segment information
Net operating revenues	261,586	254,868	517,735	505,745
Adjusted EBITDA	43,061	43,039	85,653	77,192
Total assets	1,310,483	1,328,243	1,310,483	1,328,243
Purchases of property and equipment, net	7,601	4,716	16,287	7,927
Other
Segment information
Net operating revenues	23	19	631	436
Adjusted EBITDA	(24,479)	(22,453)	(48,197)	(43,626)
Total assets	105,300	73,950	105,300	73,950
Purchases of property and equipment, net	4,156	3,636	7,093	8,545
Other | Specialty Hospitals
Segment information
Adjusted EBITDA	98,172	82,739	186,837	169,495
Other | Outpatient Rehabilitation
Segment information
Adjusted EBITDA	41,926	38,132	73,277	67,011
Other | Concentra
Segment information
Adjusted EBITDA	$ 43,061	$ 43,039	$ 85,653	$ 77,192

Segment Information - Reconcili

Segment Information - Reconciliation of Adjusted EBITDA to Income Before Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Segment information
Adjusted EBITDA	$ 158,680	$ 141,457	$ 297,570	$ 270,072
Depreciation and amortization	(38,333)	(36,205)	(80,872)	(70,722)
Income from operations	115,663	101,054	207,428	187,940
Loss on early retirement of debt			(19,719)	(773)
Write Off Of Deferred Debt Issuance Cost And Discounts			6,527	773
Equity in earnings of unconsolidated subsidiaries	5,666	4,546	11,187	9,198
Non-operating gain (loss)		13,035	(49)	38,122
Interest expense	(37,655)	(44,332)	(78,508)	(83,180)
Income before income taxes	83,674	74,303	120,339	151,307
Total assets	5,054,211	4,819,889	5,054,211	4,819,889	$ 4,920,626
ASU 2015-17
Segment information
Total assets					4,920,626
ASU 2015-17 | Restatement Adjustment
Segment information
Total assets		18,500		18,500
Operating Segments | Specialty Hospitals
Segment information
Adjusted EBITDA	98,172	82,739	186,837	169,495
Depreciation and amortization	(15,454)	(13,812)	(33,954)	(27,705)
Income from operations	82,718	68,927	152,883	141,790
Total assets	2,655,617	2,457,948	2,655,617	2,457,948
Operating Segments | Outpatient Rehabilitation
Segment information
Adjusted EBITDA	41,926	38,132	73,277	67,011
Depreciation and amortization	(5,878)	(6,202)	(12,218)	(10,238)
Income from operations	36,048	31,930	61,059	56,773
Total assets	982,811	959,748	982,811	959,748
Operating Segments | Concentra
Segment information
Adjusted EBITDA	43,061	43,039	85,653	77,192
Depreciation and amortization	(15,429)	(14,916)	(31,552)	(30,292)
Stock compensation expense	(264)	(192)	(570)	(384)
Income from operations	27,368	27,931	53,531	46,516
Total assets	1,310,483	1,328,243	1,310,483	1,328,243
Other
Segment information
Adjusted EBITDA	(24,479)	(22,453)	(48,197)	(43,626)
Depreciation and amortization	(1,572)	(1,275)	(3,148)	(2,487)
Stock compensation expense	(4,420)	(4,006)	(8,700)	(7,790)
Income from operations	(30,471)	(27,734)	(60,045)	(57,139)
Total assets	105,300	73,950	105,300	73,950
Other | Physiotherapy
Segment information
Acquisition costs				(3,236)
Other | Specialty Hospitals
Segment information
Adjusted EBITDA	98,172	82,739	186,837	169,495
Other | Outpatient Rehabilitation
Segment information
Adjusted EBITDA	41,926	38,132	73,277	67,011
Other | Concentra
Segment information
Adjusted EBITDA	43,061	43,039	85,653	77,192
Select Medical Corporation
Segment information
Depreciation and amortization	(38,333)	(36,205)	(80,872)	(70,722)
Income from operations	115,663	101,054	207,428	187,940
Loss on early retirement of debt			(19,719)	(773)
Write Off Of Deferred Debt Issuance Cost And Discounts			6,527	773
Equity in earnings of unconsolidated subsidiaries	5,666	4,546	11,187	9,198
Non-operating gain (loss)		13,035	(49)	38,122
Interest expense	(37,655)	(44,332)	(78,508)	(83,180)
Income before income taxes	83,674	$ 74,303	120,339	$ 151,307
Total assets	$ 5,054,211		$ 5,054,211		$ 4,920,626

Income per Common Share (Detail

Income per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Numerator:
Net income attributable to Select Medical Corporation	$ 42,055	$ 33,935	$ 57,925	$ 88,768
Less: Earnings allocated to unvested restricted stockholders	1,341	972	1,849	2,552
Net income available to common stockholders	$ 40,714	$ 32,963	$ 56,076	$ 86,216
Denominator:
Weighted average shares - basic	128,624	127,626	128,544	127,563
Effect of dilutive securities: Stock options (in shares)	153	194	159	146
Weighted average shares - diluted	128,777	127,820	128,703	127,709
Income per common share
Basic income per common share: (in dollars per share)	$ 0.32	$ 0.26	$ 0.44	$ 0.68
Diluted income per common share: (in dollars per share)	$ 0.32	$ 0.26	$ 0.44	$ 0.68

Commitments and Contingencies -

Commitments and Contingencies - Litigation (Details) $ in Millions	Oct. 19, 2015item	Jul. 13, 2015item	Jun. 30, 2017USD ($)
Select, SSH-Knoxville, and SSH-North Knoxville
Commitments and Contingencies
Number of current or former employees named as defendants | item		10
Professional liability claims
Commitments and Contingencies
Self insurance retention per occurrence | $			$ 2
General liability claims
Commitments and Contingencies
Self insurance retention per occurrence | $			$ 2
Amended complaint | SSH-Evansville
Commitments and Contingencies
Number of case managers identified as plaintiff | item	2

Condensed Consolidating Finan37

Condensed Consolidating Financial Information (Details)	Jun. 30, 2017
6.375% senior notes | Select Medical Corporation
Condensed Consolidating Financial Information
Interest rate of debt (as a percent)	6.375%

Condensed Consolidating Finan38

Condensed Consolidating Financial Information - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016	Dec. 31, 2015
Current Assets:
Cash and cash equivalents	$ 73,799	$ 99,029	$ 78,420	$ 14,435
Accounts receivable, net	714,236	573,752
Prepaid income taxes		12,423
Other current assets	83,211	77,699
Total Current Assets	871,246	762,903
Property and equipment, net	911,532	892,217
Goodwill	2,766,296	2,751,000
Identifiable intangible assets, net	335,704	340,562
Other assets	169,433	173,944
Total Assets	5,054,211	4,920,626	4,819,889
Current Liabilities:
Bank overdrafts	34,134	39,362
Current portion of long-term debt and notes payable	26,577	13,656
Accounts payable	123,631	126,558
Accrued payroll	119,187	146,397
Accrued vacation	92,250	83,261
Accrued interest	19,277	22,325
Accrued other	146,853	140,076
Income taxes payable	6,976
Total Current Liabilities	568,885	571,635
Long-term debt, net of current portion	2,734,132	2,685,333
Non-current deferred tax liability	197,411	199,078
Other non-current liabilities	141,279	136,520
Total Liabilities	3,641,707	3,592,566
Redeemable non-controlling interests	468,850	422,159
Stockholder's Equity:
Common stock	133	132
Capital in excess of par	454,892	443,908
Retained earnings (accumulated deficit)	393,294	371,685
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders' Equity	848,319	815,725
Non-controlling interests	95,335	90,176
Total Equity	943,654	905,901
Total Liabilities and Equity	5,054,211	4,920,626
Select Medical Corporation
Current Assets:
Cash and cash equivalents	73,799	99,029	78,420	14,435
Accounts receivable, net	714,236	573,752
Prepaid income taxes		12,423
Other current assets	83,211	77,699
Total Current Assets	871,246	762,903
Property and equipment, net	911,532	892,217
Goodwill	2,766,296	2,751,000
Identifiable intangible assets, net	335,704	340,562
Other assets	169,433	173,944
Total Assets	5,054,211	4,920,626
Current Liabilities:
Bank overdrafts	34,134	39,362
Current portion of long-term debt and notes payable	26,577	13,656
Accounts payable	123,631	126,558
Accrued payroll	119,187	146,397
Accrued vacation	92,250	83,261
Accrued interest	19,277	22,325
Accrued other	146,853	140,076
Income taxes payable	6,976
Total Current Liabilities	568,885	571,635
Long-term debt, net of current portion	2,734,132	2,685,333
Non-current deferred tax liability	197,411	199,078
Other non-current liabilities	141,279	136,520
Total Liabilities	3,641,707	3,592,566
Redeemable non-controlling interests	468,850	422,159
Stockholder's Equity:
Common stock	0	0
Capital in excess of par	936,428	925,111
Retained earnings (accumulated deficit)	(88,109)	(109,386)
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders' Equity	848,319	815,725
Non-controlling interests	95,335	90,176
Total Equity	943,654	905,901
Total Liabilities and Equity	5,054,211	4,920,626
Select Medical Corporation | Reportable legal entities | Select (Parent Company Only)
Current Assets:
Cash and cash equivalents	72	11,071	4,071	4,070
Prepaid income taxes		6,658
Other current assets	17,584	11,953
Total Current Assets	17,656	29,682
Property and equipment, net	56,568	48,697
Investment in affiliates	4,523,727	4,493,684
Other assets	42,452	45,636
Total Assets	4,640,403	4,617,699
Current Liabilities:
Bank overdrafts	34,134	39,362
Current portion of long-term debt and notes payable	23,052	7,227
Accounts payable	10,362	10,775
Intercompany payables	1,489,631	1,573,960
Accrued payroll	7,526	16,963
Accrued vacation	3,927	3,440
Accrued interest	17,096	20,114
Accrued other	44,032	39,155
Income taxes payable	2,709
Total Current Liabilities	1,632,469	1,710,996
Long-term debt, net of current portion	2,115,318	2,048,154
Other non-current liabilities	44,297	42,824
Total Liabilities	3,792,084	3,801,974
Stockholder's Equity:
Common stock	0	0
Capital in excess of par	936,428	925,111
Retained earnings (accumulated deficit)	(88,109)	(109,386)
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders' Equity	848,319	815,725
Total Equity	848,319	815,725
Total Liabilities and Equity	4,640,403	4,617,699
Select Medical Corporation | Reportable legal entities | Subsidiary Guarantors
Current Assets:
Cash and cash equivalents	5,533	6,467	8,111	3,706
Accounts receivable, net	467,412	363,470
Intercompany receivables	1,489,631	1,573,960
Other current assets	28,326	33,958
Total Current Assets	1,990,902	1,977,855
Property and equipment, net	620,364	603,408
Investment in affiliates	118,248	89,288
Goodwill	2,091,754	2,090,963
Identifiable intangible assets, net	109,913	109,132
Other assets	98,649	84,803
Total Assets	5,029,830	4,955,449
Current Liabilities:
Current portion of long-term debt and notes payable	644	445
Accounts payable	75,105	78,608
Intercompany payables	58,333	28,271
Accrued payroll	80,245	92,216
Accrued vacation	58,895	55,486
Accrued interest	5
Accrued other	60,078	62,384
Total Current Liabilities	333,305	317,410
Long-term debt, net of current portion	266	601
Non-current deferred tax liability	136,920	133,852
Other non-current liabilities	54,100	53,537
Total Liabilities	524,591	505,400
Redeemable non-controlling interests		113
Stockholder's Equity:
Retained earnings (accumulated deficit)	1,314,773	1,269,014
Subsidiary investment	3,190,466	3,180,922
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders' Equity	4,505,239	4,449,936
Total Equity	4,505,239	4,449,936
Total Liabilities and Equity	5,029,830	4,955,449
Select Medical Corporation | Reportable legal entities | Non-Guarantor Subsidiaries
Current Assets:
Cash and cash equivalents	4,946	5,056	5,374	625
Accounts receivable, net	120,272	97,770
Intercompany receivables	58,333	28,271
Other current assets	12,786	10,269
Total Current Assets	196,337	141,366
Property and equipment, net	54,964	50,869
Other assets	36,528	53,954
Total Assets	287,829	246,189
Current Liabilities:
Current portion of long-term debt and notes payable	244	1,324
Accounts payable	22,387	22,397
Accrued payroll	3,545	4,246
Accrued vacation	12,214	10,668
Accrued interest	4
Accrued other	10,533	4,639
Total Current Liabilities	48,927	43,274
Long-term debt, net of current portion	9,663	9,685
Non-current deferred tax liability	736	596
Other non-current liabilities	7,688	5,727
Total Liabilities	67,014	59,282
Redeemable non-controlling interests	10,079	10,056
Stockholder's Equity:
Retained earnings (accumulated deficit)	(37,110)	(38,313)
Subsidiary investment	156,262	128,556
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders' Equity	119,152	90,243
Non-controlling interests	91,584	86,608
Total Equity	210,736	176,851
Total Liabilities and Equity	287,829	246,189
Select Medical Corporation | Reportable legal entities | Non-Guarantor Concentra
Current Assets:
Cash and cash equivalents	63,248	76,435	$ 60,864	$ 6,034
Accounts receivable, net	126,552	112,512
Prepaid income taxes		5,765
Other current assets	24,515	21,519
Total Current Assets	214,315	216,231
Property and equipment, net	179,636	189,243
Goodwill	674,542	660,037
Identifiable intangible assets, net	225,791	231,430
Other assets	16,199	16,235
Total Assets	1,310,483	1,313,176
Current Liabilities:
Current portion of long-term debt and notes payable	2,637	4,660
Accounts payable	15,777	14,778
Accrued payroll	27,871	32,972
Accrued vacation	17,214	13,667
Accrued interest	2,172	2,211
Accrued other	32,210	33,898
Income taxes payable	4,267
Total Current Liabilities	102,148	102,186
Long-term debt, net of current portion	608,885	626,893
Non-current deferred tax liability	84,150	91,314
Other non-current liabilities	35,194	34,432
Total Liabilities	830,377	854,825
Redeemable non-controlling interests	458,771	411,990
Stockholder's Equity:
Retained earnings (accumulated deficit)	12,447	1,364
Subsidiary investment	5,137	41,429
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders' Equity	17,584	42,793
Non-controlling interests	3,751	3,568
Total Equity	21,335	46,361
Total Liabilities and Equity	1,310,483	1,313,176
Select Medical Corporation | Eliminations
Current Assets:
Intercompany receivables	(1,547,964)	(1,602,231)
Total Current Assets	(1,547,964)	(1,602,231)
Investment in affiliates	(4,641,975)	(4,582,972)
Other assets	(24,395)	(26,684)
Total Assets	(6,214,334)	(6,211,887)
Current Liabilities:
Intercompany payables	(1,547,964)	(1,602,231)
Total Current Liabilities	(1,547,964)	(1,602,231)
Non-current deferred tax liability	(24,395)	(26,684)
Total Liabilities	(1,572,359)	(1,628,915)
Stockholder's Equity:
Retained earnings (accumulated deficit)	(1,290,110)	(1,232,065)
Subsidiary investment	(3,351,865)	(3,350,907)
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders' Equity	(4,641,975)	(4,582,972)
Total Equity	(4,641,975)	(4,582,972)
Total Liabilities and Equity	$ (6,214,334)	$ (6,211,887)

Condensed Consolidating Finan39

Condensed Consolidating Financial Information - Condensed Consolidating Statement of Operations (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Condensed Consolidating Statement of Operations
Net operating revenues	$ 1,120,675	$ 1,097,631	$ 2,232,036	$ 2,185,961
Costs and expenses:
Cost of services	920,230	916,985	1,848,587	1,839,247
General and administrative	28,275	25,870	56,350	54,138
Bad debt expense	18,174	17,517	38,799	33,914
Depreciation and amortization	38,333	36,205	80,872	70,722
Total costs and expenses	1,005,012	996,577	2,024,608	1,998,021
Income from operations	115,663	101,054	207,428	187,940
Other income and expense:
Loss on early retirement of debt			(19,719)	(773)
Equity in earnings of unconsolidated subsidiaries	5,666	4,546	11,187	9,198
Non-operating gain (loss)		13,035	(49)	38,122
Interest expense	(37,655)	(44,332)	(78,508)	(83,180)
Income before income taxes	83,674	74,303	120,339	151,307
Income tax expense (benefit)	32,374	33,450	45,576	50,510
Net income (loss)	51,300	40,853	74,763	100,797
Less: Net income attributable to non-controlling interests	9,245	6,918	16,838	12,029
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation	42,055	33,935	57,925	88,768
Select Medical Corporation
Condensed Consolidating Statement of Operations
Net operating revenues	1,120,675	1,097,631	2,232,036	2,185,961
Costs and expenses:
Cost of services	920,230	916,985	1,848,587	1,839,247
General and administrative	28,275	25,870	56,350	54,138
Bad debt expense	18,174	17,517	38,799	33,914
Depreciation and amortization	38,333	36,205	80,872	70,722
Total costs and expenses	1,005,012	996,577	2,024,608	1,998,021
Income from operations	115,663	101,054	207,428	187,940
Other income and expense:
Loss on early retirement of debt			(19,719)	(773)
Equity in earnings of unconsolidated subsidiaries	5,666	4,546	11,187	9,198
Non-operating gain (loss)		13,035	(49)	38,122
Interest expense	(37,655)	(44,332)	(78,508)	(83,180)
Income before income taxes	83,674	74,303	120,339	151,307
Income tax expense (benefit)	32,374	33,450	45,576	50,510
Net income (loss)	51,300	40,853	74,763	100,797
Less: Net income attributable to non-controlling interests	9,245	6,918	16,838	12,029
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation	42,055	33,935	57,925	88,768
Select Medical Corporation | Reportable legal entities | Select (Parent Company Only)
Condensed Consolidating Statement of Operations
Net operating revenues	23	20	631	437
Costs and expenses:
Cost of services	644	606	1,176	950
General and administrative	28,227	25,844	56,263	54,231
Depreciation and amortization	1,573	1,276	3,148	2,487
Total costs and expenses	30,444	27,726	60,587	57,668
Income from operations	(30,421)	(27,706)	(59,956)	(57,231)
Other income and expense:
Intercompany interest and royalty fees	(2,263)	(1,532)	(4,159)	(2,590)
Intercompany management fees	63,504	38,783	125,202	94,139
Loss on early retirement of debt			(19,719)	(773)
Non-operating gain (loss)		10,463		40,895
Interest expense	(19,623)	(25,544)	(42,431)	(45,890)
Income before income taxes	11,197	(5,536)	(1,063)	28,550
Income tax expense (benefit)	(2,324)	(473)	(2,198)	8,139
Equity in earnings of subsidiaries	28,534	38,998	56,790	68,357
Net income (loss)	42,055	33,935	57,925	88,768
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation	42,055	33,935	57,925	88,768
Select Medical Corporation | Reportable legal entities | Subsidiary Guarantors
Condensed Consolidating Statement of Operations
Net operating revenues	687,886	723,859	1,377,279	1,439,439
Costs and expenses:
Cost of services	561,304	605,730	1,142,527	1,211,439
General and administrative	48	26	87	(93)
Bad debt expense	9,829	10,285	21,577	21,003
Depreciation and amortization	18,149	17,316	39,489	32,648
Total costs and expenses	589,330	633,357	1,203,680	1,264,997
Income from operations	98,556	90,502	173,599	174,442
Other income and expense:
Intercompany interest and royalty fees	3,596	3,274	6,914	6,044
Intercompany management fees	(53,435)	(32,430)	(106,069)	(82,127)
Equity in earnings of unconsolidated subsidiaries	5,646	4,519	11,139	9,146
Non-operating gain (loss)		2,572	(49)	(2,773)
Interest expense	(8,234)	(6,684)	(16,307)	(13,318)
Income before income taxes	46,129	61,753	69,227	91,414
Income tax expense (benefit)	27,307	26,370	33,243	31,985
Equity in earnings of subsidiaries	4,200	(1,133)	9,775	1,873
Net income (loss)	23,022	34,250	45,759	61,302
Less: Net income attributable to non-controlling interests		18		33
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation	23,022	34,232	45,759	61,269
Select Medical Corporation | Reportable legal entities | Non-Guarantor Subsidiaries
Condensed Consolidating Statement of Operations
Net operating revenues	171,180	118,884	336,391	240,340
Costs and expenses:
Cost of services	144,211	103,767	282,521	206,774
Bad debt expense	3,627	2,093	6,933	4,058
Depreciation and amortization	3,182	2,697	6,683	5,295
Total costs and expenses	151,020	108,557	296,137	216,127
Income from operations	20,160	10,327	40,254	24,213
Other income and expense:
Intercompany interest and royalty fees	(1,333)	(1,742)	(2,755)	(3,454)
Intercompany management fees	(10,069)	(6,353)	(19,133)	(12,012)
Equity in earnings of unconsolidated subsidiaries	20	27	48	52
Interest expense	(2,360)	(1,852)	(4,833)	(3,491)
Income before income taxes	6,418	407	13,581	5,308
Income tax expense (benefit)	309	672	613	607
Net income (loss)	6,109	(265)	12,968	4,701
Less: Net income attributable to non-controlling interests	2,175	824	3,244	2,695
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation	3,934	(1,089)	9,724	2,006
Select Medical Corporation | Reportable legal entities | Non-Guarantor Concentra
Condensed Consolidating Statement of Operations
Net operating revenues	261,586	254,868	517,735	505,745
Costs and expenses:
Cost of services	214,071	206,882	422,363	420,084
Bad debt expense	4,718	5,139	10,289	8,853
Depreciation and amortization	15,429	14,916	31,552	30,292
Total costs and expenses	234,218	226,937	464,204	459,229
Income from operations	27,368	27,931	53,531	46,516
Other income and expense:
Interest expense	(7,438)	(10,252)	(14,937)	(20,481)
Income before income taxes	19,930	17,679	38,594	26,035
Income tax expense (benefit)	7,082	6,881	13,918	9,779
Net income (loss)	12,848	10,798	24,676	16,256
Less: Net income attributable to non-controlling interests	7,070	6,076	13,594	9,301
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation	5,778	4,722	11,082	6,955
Select Medical Corporation | Eliminations
Other income and expense:
Equity in earnings of subsidiaries	(32,734)	(37,865)	(66,565)	(70,230)
Net income (loss)	(32,734)	(37,865)	(66,565)	(70,230)
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation	$ (32,734)	$ (37,865)	$ (66,565)	$ (70,230)

Condensed Consolidating Finan40

Condensed Consolidating Financial Information - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Operating activities
Net income	$ 51,300	$ 40,853	$ 74,763	$ 100,797
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Distributions from unconsolidated subsidiaries			10,933	12,039
Depreciation and amortization	38,333	36,205	80,872	70,722
Provision for bad debts	18,174	17,517	38,799	33,914
Equity in earnings of unconsolidated subsidiaries	(5,666)	(4,546)	(11,187)	(9,198)
Loss on extinguishment of debt			6,527	773
Gain on sale of assets and businesses			(9,523)	(43,461)
Loss on disposal of assets				55
Impairment of equity investment				5,339
Stock compensation expense			9,270	8,174
Amortization of debt discount, premium and issuance costs			5,974	7,077
Deferred income taxes			(1,474)	(13,286)
Changes in operating assets and liabilities, net of effects of business combinations:
Accounts receivable			(179,003)	(44,096)
Other current assets			(5,557)	11,011
Other assets			4,621	4,508
Accounts payable			759	(15,852)
Accrued expenses			(4,833)	20,632
Income taxes			19,399	29,090
Net cash provided by operating activities			40,340	178,238
Investing activities
Acquisition of businesses, net of cash acquired			(18,508)	(421,519)
Purchases of property and equipment	(54,649)	(33,490)	(105,302)	(80,258)
Investment in businesses			(9,874)	(1,590)
Proceeds from sale of assets and businesses			34,552	71,366
Net cash used in investing activities			(99,132)	(432,001)
Financing activities
Borrowings on revolving facilities			630,000	320,000
Payments on revolving facilities			(550,000)	(380,000)
Proceeds from term loans			1,139,487	600,127
Payments on term loans			(1,173,692)	(229,649)
Revolving facility debt issuance costs			(4,392)
Borrowings of other debt			9,444	22,082
Principal payments on other debt			(10,437)	(9,926)
Repayments of bank overdrafts			(5,228)	(2,138)
Proceeds from issuance of non-controlling interests			3,553	3,103
Purchase of non-controlling interests			(120)	(1,294)
Distributions to non-controlling interests			(5,416)	(4,708)
Net cash provided by financing activities			33,562	317,748
Net increase (decrease) in cash and cash equivalents			(25,230)	63,985
Cash and cash equivalents at beginning of period			99,029	14,435
Cash and cash equivalents at end of period	73,799	78,420	73,799	78,420
Select Medical Corporation
Operating activities
Net income	51,300	40,853	74,763	100,797
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Distributions from unconsolidated subsidiaries			10,933	12,039
Depreciation and amortization	38,333	36,205	80,872	70,722
Provision for bad debts	18,174	17,517	38,799	33,914
Equity in earnings of unconsolidated subsidiaries	(5,666)	(4,546)	(11,187)	(9,198)
Loss on extinguishment of debt			6,527	773
Gain on sale of assets and businesses			(9,523)	(43,461)
Loss on disposal of assets				55
Impairment of equity investment				5,339
Stock compensation expense			9,270	8,174
Amortization of debt discount, premium and issuance costs			5,974	7,077
Deferred income taxes			(1,474)	(13,286)
Changes in operating assets and liabilities, net of effects of business combinations:
Accounts receivable			(179,003)	(44,096)
Other current assets			(5,557)	11,011
Other assets			4,621	4,508
Accounts payable			759	(15,852)
Accrued expenses			(4,833)	20,632
Income taxes			19,399	29,090
Net cash provided by operating activities			40,340	178,238
Investing activities
Acquisition of businesses, net of cash acquired			(18,508)	(421,519)
Purchases of property and equipment			(105,302)	(80,258)
Investment in businesses			(9,874)	(1,590)
Proceeds from sale of assets and businesses			34,552	71,366
Net cash used in investing activities			(99,132)	(432,001)
Financing activities
Borrowings on revolving facilities			630,000	320,000
Payments on revolving facilities			(550,000)	(380,000)
Proceeds from term loans			1,139,487	600,127
Payments on term loans			(1,173,692)	(229,649)
Revolving facility debt issuance costs			(4,392)
Borrowings of other debt			9,444	22,082
Principal payments on other debt			(10,437)	(9,926)
Repayments of bank overdrafts			(5,228)	(2,138)
Dividends paid to Holdings			(600)	(506)
Equity investment by Holdings			963	657
Proceeds from issuance of non-controlling interests			3,553	3,103
Purchase of non-controlling interests			(120)	(1,294)
Distributions to non-controlling interests			(5,416)	(4,708)
Net cash provided by financing activities			33,562	317,748
Net increase (decrease) in cash and cash equivalents			(25,230)	63,985
Cash and cash equivalents at beginning of period			99,029	14,435
Cash and cash equivalents at end of period	73,799	78,420	73,799	78,420
Select Medical Corporation | Reportable legal entities | Select (Parent Company Only)
Operating activities
Net income	42,055	33,935	57,925	88,768
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	1,573	1,276	3,148	2,487
Equity in earnings of consolidated subsidiaries	(28,534)	(38,998)	(56,790)	(68,357)
Loss on extinguishment of debt			6,527	773
Gain on sale of assets and businesses			(8)	(40,895)
Stock compensation expense			8,700	7,790
Amortization of debt discount, premium and issuance costs			4,342	5,371
Deferred income taxes			5,987	997
Changes in operating assets and liabilities, net of effects of business combinations:
Other current assets			(5,631)	(2,938)
Other assets			3,184	(4,268)
Accounts payable			(413)	(2,241)
Accrued expenses			(5,618)	(10,175)
Income taxes			9,366	9,101
Net cash provided by operating activities			30,719	(13,587)
Investing activities
Acquisition of businesses, net of cash acquired				(408,654)
Purchases of property and equipment			(7,093)	(8,545)
Proceeds from sale of assets and businesses			8	63,418
Net cash used in investing activities			(7,085)	(353,781)
Financing activities
Borrowings on revolving facilities			630,000	320,000
Payments on revolving facilities			(550,000)	(375,000)
Proceeds from term loans			1,139,487	600,127
Payments on term loans			(1,150,627)	(227,399)
Revolving facility debt issuance costs			(4,392)
Borrowings of other debt			6,572	9,765
Principal payments on other debt			(7,353)	(7,278)
Repayments of bank overdrafts			(5,228)	(2,138)
Dividends paid to Holdings			(600)	(506)
Equity investment by Holdings			963	657
Intercompany			(93,455)	49,141
Net cash provided by financing activities			(34,633)	367,369
Net increase (decrease) in cash and cash equivalents			(10,999)	1
Cash and cash equivalents at beginning of period			11,071	4,070
Cash and cash equivalents at end of period	72	4,071	72	4,071
Select Medical Corporation | Reportable legal entities | Subsidiary Guarantors
Operating activities
Net income	23,022	34,250	45,759	61,302
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Distributions from unconsolidated subsidiaries			10,902	12,000
Depreciation and amortization	18,149	17,316	39,489	32,648
Provision for bad debts	9,829	10,285	21,577	21,003
Equity in earnings of unconsolidated subsidiaries	(5,646)	(4,519)	(11,139)	(9,146)
Equity in earnings of consolidated subsidiaries	(4,200)	1,133	(9,775)	(1,873)
Gain on sale of assets and businesses			(4,828)	(2,566)
Loss on disposal of assets				37
Impairment of equity investment				5,339
Changes in operating assets and liabilities, net of effects of business combinations:
Accounts receivable			(125,418)	(22,896)
Other current assets			5,452	7,342
Other assets			(16,925)	(341)
Accounts payable			(1,550)	(17,695)
Accrued expenses			(4,817)	36,088
Net cash provided by operating activities			(51,273)	121,242
Investing activities
Acquisition of businesses, net of cash acquired			(2,305)	(605)
Purchases of property and equipment			(71,813)	(52,591)
Investment in businesses			(9,874)	(1,590)
Proceeds from sale of assets and businesses			15,007	7,942
Net cash used in investing activities			(68,985)	(46,844)
Financing activities
Principal payments on other debt			(204)	(385)
Intercompany			119,528	(68,206)
Purchase of non-controlling interests				(1,294)
Distributions to non-controlling interests				(108)
Net cash provided by financing activities			119,324	(69,993)
Net increase (decrease) in cash and cash equivalents			(934)	4,405
Cash and cash equivalents at beginning of period			6,467	3,706
Cash and cash equivalents at end of period	5,533	8,111	5,533	8,111
Select Medical Corporation | Reportable legal entities | Non-Guarantor Subsidiaries
Operating activities
Net income	6,109	(265)	12,968	4,701
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Distributions from unconsolidated subsidiaries			31	39
Depreciation and amortization	3,182	2,697	6,683	5,295
Provision for bad debts	3,627	2,093	6,933	4,058
Equity in earnings of unconsolidated subsidiaries	(20)	(27)	(48)	(52)
Gain on sale of assets and businesses			(4,687)
Loss on disposal of assets				12
Amortization of debt discount, premium and issuance costs				2
Changes in operating assets and liabilities, net of effects of business combinations:
Accounts receivable			(29,435)	(9,711)
Other current assets			(2,517)	(1,273)
Other assets			17,426	(424)
Accounts payable			(10)	(3,371)
Accrued expenses			8,704	(2,441)
Net cash provided by operating activities			16,048	(3,165)
Investing activities
Acquisition of businesses, net of cash acquired				(8,395)
Purchases of property and equipment			(10,109)	(11,195)
Proceeds from sale of assets and businesses			19,537	6
Net cash used in investing activities			9,428	(19,584)
Financing activities
Borrowings of other debt			105	9,500
Principal payments on other debt			(1,183)	(876)
Intercompany			(26,073)	19,065
Proceeds from issuance of non-controlling interests			3,553	3,103
Purchase of non-controlling interests			(120)
Distributions to non-controlling interests			(1,868)	(3,294)
Net cash provided by financing activities			(25,586)	27,498
Net increase (decrease) in cash and cash equivalents			(110)	4,749
Cash and cash equivalents at beginning of period			5,056	625
Cash and cash equivalents at end of period	4,946	5,374	4,946	5,374
Select Medical Corporation | Reportable legal entities | Non-Guarantor Concentra
Operating activities
Net income	12,848	10,798	24,676	16,256
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	15,429	14,916	31,552	30,292
Provision for bad debts	4,718	5,139	10,289	8,853
Loss on disposal of assets				6
Stock compensation expense			570	384
Amortization of debt discount, premium and issuance costs			1,632	1,704
Deferred income taxes			(7,461)	(14,283)
Changes in operating assets and liabilities, net of effects of business combinations:
Accounts receivable			(24,150)	(11,489)
Other current assets			(2,861)	7,880
Other assets			936	9,541
Accounts payable			2,732	7,455
Accrued expenses			(3,102)	(2,840)
Income taxes			10,033	19,989
Net cash provided by operating activities			44,846	73,748
Investing activities
Acquisition of businesses, net of cash acquired			(16,203)	(3,865)
Purchases of property and equipment			(16,287)	(7,927)
Net cash used in investing activities			(32,490)	(11,792)
Financing activities
Payments on revolving facilities				(5,000)
Payments on term loans			(23,065)	(2,250)
Borrowings of other debt			2,767	2,817
Principal payments on other debt			(1,697)	(1,387)
Distributions to non-controlling interests			(3,548)	(1,306)
Net cash provided by financing activities			(25,543)	(7,126)
Net increase (decrease) in cash and cash equivalents			(13,187)	54,830
Cash and cash equivalents at beginning of period			76,435	6,034
Cash and cash equivalents at end of period	63,248	60,864	63,248	60,864
Select Medical Corporation | Eliminations
Operating activities
Net income	(32,734)	(37,865)	(66,565)	(70,230)
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Equity in earnings of consolidated subsidiaries	$ 32,734	$ 37,865	$ 66,565	$ 70,230