Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2024 | Apr. 29, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-37392 | |
Entity Registrant Name | Astrana Health, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 95-4472349 | |
Entity Address, Address Line One | 1668 S. Garfield Avenue | |
Entity Address, Address Line Two | 2nd Floor | |
Entity Address, City or Town | Alhambra | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 91801 | |
City Area Code | 626 | |
Local Phone Number | 282-0288 | |
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | ASTH | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 56,025,538 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001083446 | |
Current Fiscal Year End Date | --12-31 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | |
Current assets | |||
Cash and cash equivalents | $ 334,796 | $ 293,807 | |
Investment in marketable securities | 2,490 | 2,498 | |
Income taxes receivable | 0 | 10,657 | |
Other receivables | 1,783 | 1,335 | |
Prepaid expenses and other current assets | 17,281 | 17,450 | |
Total current assets | 538,810 | 461,507 | |
Non-current assets | |||
Land, property and equipment, net | 7,985 | 7,171 | |
Intangible assets, net | 119,707 | 71,648 | |
Goodwill | 410,267 | 278,831 | |
Income taxes receivable | 15,943 | 15,943 | |
Investments in other entities – equity method | 35,893 | 25,774 | |
Investments in privately held entities | 6,396 | 6,396 | |
Restricted cash | 645 | 345 | |
Operating lease right-of-use assets | 39,152 | 37,396 | |
Other assets | 4,067 | 1,877 | |
Total non-current assets | 687,467 | 471,854 | |
Total assets | [1] | 1,226,277 | 933,361 |
Current liabilities | |||
Accounts payable and accrued expenses | 146,473 | 59,949 | |
Fiduciary accounts payable | 7,792 | 7,737 | |
Medical liabilities | 136,494 | 106,657 | |
Income taxes payable | 5,522 | 0 | |
Dividend payable | 638 | 638 | |
Finance lease liabilities | 636 | 646 | |
Operating lease liabilities | 5,007 | 4,607 | |
Current portion of long-term debt | 20,750 | 19,500 | |
Other liabilities | 31,960 | 18,940 | |
Total current liabilities | 355,272 | 218,674 | |
Non-current liabilities | |||
Deferred tax liability | 3,756 | 4,072 | |
Finance lease liabilities, net of current portion | 1,015 | 1,033 | |
Operating lease liabilities, net of current portion | 37,716 | 36,289 | |
Long-term debt, net of current portion and deferred financing costs | 368,448 | 258,939 | |
Other long-term liabilities | 7,652 | 3,586 | |
Total non-current liabilities | 418,587 | 303,919 | |
Total liabilities | [1] | 773,859 | 522,593 |
Commitments and contingencies (Note 12) | |||
Mezzanine equity | |||
Noncontrolling interest in Allied Physicians of California, a Professional Medical Corporation ("APC") | (205,557) | (205,883) | |
Stockholders’ equity | |||
Common stock, value, issued | 48 | 47 | |
Additional paid-in capital | 395,473 | 371,037 | |
Retained earnings | 257,969 | 243,134 | |
Total stockholders’ equity | 653,490 | 614,218 | |
Non-controlling interest | 4,485 | 2,433 | |
Total equity | 657,975 | 616,651 | |
Total liabilities, mezzanine equity and equity | 1,226,277 | 933,361 | |
Series A Preferred Stock | |||
Stockholders’ equity | |||
Preferred stock | 0 | 0 | |
Series B Preferred Stock | |||
Stockholders’ equity | |||
Preferred stock | 0 | 0 | |
Nonrelated Party | |||
Current assets | |||
Receivables, net | 120,106 | 76,780 | |
Non-current assets | |||
Loans receivable, non-current | 47,412 | 26,473 | |
Related Party | |||
Current assets | |||
Receivables, net | $ 62,354 | $ 58,980 | |
[1] The Company’s condensed consolidated balance sheets include the assets and liabilities of its consolidated VIEs. The condensed consolidated balance sheets include total assets that can be used only to settle obligations of the Company’s consolidated VIEs totaling $717.5 million and $540.8 million as of March 31, 2024 and December 31, 2023, respectively, and total liabilities of the Company’s consolidated VIEs for which creditors do not have recourse to the general credit of the primary beneficiary of $179.6 million and $146.0 million as of March 31, 2024 and December 31, 2023, respectively. These VIE balances do not include $299.5 million of investment in affiliates and $110.1 million of amounts due to affiliates as of March 31, 2024, and $273.2 million of investment in affiliates and $107.3 million of amounts due to affiliates as of December 31, 2023, as these are eliminated upon consolidation and not presented within the condensed consolidated balance sheets. See Note 16 — “Variable Interest Entities (VIEs)” for further details. |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 | |
Common stock, shares issued (in shares) | 47,458,264 | 46,843,743 | |
Common stock, shares outstanding (in shares) | 47,458,264 | 46,843,743 | |
Treasury stock, common, shares (in shares) | 10,584,340 | 10,584,340 | |
Assets | [1] | $ 1,226,277 | $ 933,361 |
Total liabilities | [1] | 773,859 | 522,593 |
Variable Interest Entity, Not Primary Beneficiary | |||
Assets | 717,500 | 540,800 | |
Total liabilities | 179,600 | 146,000 | |
Investments in affiliates | 299,500 | 273,200 | |
Amount due to affiliates | $ 110,100 | ||
Due from affiliates | $ 107,300 | ||
Series A Preferred Stock | |||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 | |
Preferred stock, shares issued (in shares) | 1,111,111 | 1,111,111 | |
Preferred stock, shares outstanding (in shares) | 0 | 0 | |
Series B Preferred Stock | |||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 | |
Preferred stock, shares issued (in shares) | 555,555 | 555,555 | |
Preferred stock, shares outstanding (in shares) | 0 | 0 | |
[1] The Company’s condensed consolidated balance sheets include the assets and liabilities of its consolidated VIEs. The condensed consolidated balance sheets include total assets that can be used only to settle obligations of the Company’s consolidated VIEs totaling $717.5 million and $540.8 million as of March 31, 2024 and December 31, 2023, respectively, and total liabilities of the Company’s consolidated VIEs for which creditors do not have recourse to the general credit of the primary beneficiary of $179.6 million and $146.0 million as of March 31, 2024 and December 31, 2023, respectively. These VIE balances do not include $299.5 million of investment in affiliates and $110.1 million of amounts due to affiliates as of March 31, 2024, and $273.2 million of investment in affiliates and $107.3 million of amounts due to affiliates as of December 31, 2023, as these are eliminated upon consolidation and not presented within the condensed consolidated balance sheets. See Note 16 — “Variable Interest Entities (VIEs)” for further details. |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Revenue | ||
Total revenue | $ 404,356 | $ 337,244 |
Operating expenses | ||
Cost of services, excluding depreciation and amortization | 330,399 | 289,397 |
General and administrative expenses | 38,722 | 21,182 |
Depreciation and amortization | 5,096 | 4,292 |
Total expenses | 374,217 | 314,871 |
Income from operations | 30,139 | 22,373 |
Other income (expense) | ||
Income from equity method investments | 632 | 2,484 |
Interest expense | (7,585) | (3,269) |
Interest income | 3,996 | 3,009 |
Unrealized gain (loss) on investments | 1,099 | (6,392) |
Other (loss) income | (4,277) | 1,204 |
Total other expenses, net | (6,135) | (2,964) |
Income before provision for income taxes | 24,004 | 19,409 |
Provision for income taxes | 7,142 | 6,921 |
Net income | 16,862 | 12,488 |
Net income (loss) attributable to non-controlling interest | 2,027 | (644) |
Net income attributable to Astrana Health, Inc. | $ 14,835 | $ 13,132 |
Earnings per share – basic (in dollars per share) | $ 0.31 | $ 0.28 |
Earnings per share – diluted (in dollars per share) | $ 0.31 | $ 0.28 |
Capitation, net | ||
Revenue | ||
Total revenue | $ 365,910 | $ 300,204 |
Risk pool settlements and incentives | ||
Revenue | ||
Total revenue | 17,377 | 13,462 |
Management fee income | ||
Revenue | ||
Total revenue | 4,078 | 9,896 |
Fee-for-service, net | ||
Revenue | ||
Total revenue | 15,937 | 12,062 |
Other revenue | ||
Revenue | ||
Total revenue | $ 1,054 | $ 1,620 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF MEZZANINE AND STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock Outstanding | Additional Paid-in Capital | Retained Earnings | Non-controlling Interest | Non-controlling Interest Mezzanine |
Temporary equity, carrying amount, beginning balance at Dec. 31, 2022 | $ 14,237 | |||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Net (loss) income | (1,729) | |||||
Temporary Equity, Transfer Of Common Control Entities | 1,769 | |||||
Temporary equity, carrying amount, ending balance at Mar. 31, 2023 | 14,277 | |||||
Equity, beginning balance (in shares) at Dec. 31, 2022 | 46,575,699 | |||||
Equity, beginning balance at Dec. 31, 2022 | $ 544,310 | $ 47 | $ 360,097 | $ 182,417 | $ 1,749 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) income | 14,217 | 13,132 | 1,085 | |||
Shares issued for vesting of restricted stock awards (in shares) | 57,825 | |||||
Shares issued for vesting of restricted stock awards | (109) | (109) | ||||
Shares issued for exercise of options and warrants (in shares) | 125,000 | |||||
Shares issued for exercise of options and warrants | 1,250 | 1,250 | ||||
Purchase of treasury shares (in shares) | (270,081) | |||||
Purchase of treasury shares | (9,539) | (9,539) | ||||
Share-based compensation | 3,445 | 3,445 | ||||
Dividends | (120) | (120) | ||||
Transfer of common control entities | (2,447) | (2,447) | ||||
Equity, ending balance (in shares) at Mar. 31, 2023 | 46,488,443 | |||||
Equity, ending balance at Mar. 31, 2023 | 551,007 | $ 47 | 352,697 | 195,549 | 2,714 | |
Temporary equity, carrying amount, beginning balance at Dec. 31, 2022 | 14,237 | |||||
Temporary equity, carrying amount, ending balance at Dec. 31, 2023 | (205,883) | |||||
Equity, beginning balance (in shares) at Dec. 31, 2022 | 46,575,699 | |||||
Equity, beginning balance at Dec. 31, 2022 | $ 544,310 | $ 47 | 360,097 | 182,417 | 1,749 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Purchase of treasury shares (in shares) | (3,451,642) | |||||
Equity, ending balance (in shares) at Dec. 31, 2023 | 46,843,743 | 46,843,743 | ||||
Equity, ending balance at Dec. 31, 2023 | $ 616,651 | $ 47 | 371,037 | 243,134 | 2,433 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Net (loss) income | 326 | |||||
Temporary equity, carrying amount, ending balance at Mar. 31, 2024 | $ (205,557) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) income | 16,536 | 14,835 | 1,701 | |||
Purchase of non-controlling interest | (25) | (25) | ||||
Sale of non-controlling interest | 150 | 150 | ||||
Shares issued for vesting of restricted stock awards (in shares) | 5,149 | |||||
Shares issued for vesting of restricted stock awards | $ (2,407) | (2,407) | ||||
Purchase of treasury shares (in shares) | (3,451,642) | |||||
Share-based compensation | $ 5,748 | 5,748 | ||||
Issuance of shares for business acquisition (in shares) | 631,712 | |||||
Issuance of shares for business acquisition | 21,952 | $ 1 | 21,951 | |||
Acquisition of non-controlling interest (in shares) | (22,340) | |||||
Acquisition of non-controlling interest | (535) | (856) | 321 | |||
Dividends | $ (95) | (95) | ||||
Equity, ending balance (in shares) at Mar. 31, 2024 | 47,458,264 | 47,458,264 | ||||
Equity, ending balance at Mar. 31, 2024 | $ 657,975 | $ 48 | $ 395,473 | $ 257,969 | $ 4,485 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Cash flows from operating activities | ||
Net income | $ 16,862 | $ 12,488 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 5,096 | 4,292 |
Amortization of debt issuance cost | 458 | 237 |
Share-based compensation | 5,748 | 3,445 |
Non-cash lease expense | 3,155 | 2,013 |
Unrealized (gain) loss on investments | (1,099) | 5,755 |
Income from equity method investments | (632) | (2,484) |
Unrealized loss on interest rate swaps | 0 | 637 |
Deferred tax | (7,248) | 283 |
Other | 6,795 | 0 |
Changes in operating assets and liabilities, net of business combinations: | ||
Receivable, net | (26,128) | (26,373) |
Receivable, net – related parties | (3,374) | (9,730) |
Other receivables | (1,403) | (94) |
Prepaid expenses and other current assets | (4,255) | (506) |
Other assets | 92 | (23) |
Accounts payable and accrued expenses | 905 | (4,517) |
Fiduciary accounts payable | 56 | 911 |
Medical liabilities | (808) | 17,141 |
Income taxes payable/receivable | 14,542 | 6,333 |
Operating lease liabilities | (3,083) | (2,088) |
Other long-term liabilities | 298 | 0 |
Net cash provided by operating activities | 5,977 | 7,720 |
Cash flows from investing activities | ||
Payments for business acquisition, net of cash acquired | (50,649) | 0 |
Proceeds from repayment of loans receivable – related parties | 6 | 2,141 |
Purchase of marketable securities | (27) | (1,000) |
Purchase of investment – equity method | 0 | (325) |
Issuance of loans receivable | (20,000) | 0 |
Purchases of property and equipment | (369) | (6,027) |
Deposit for purchase of property | 0 | (8,824) |
Net cash used in investing activities | (71,039) | (14,035) |
Cash flows from financing activities | ||
Dividends paid | (95) | (120) |
Borrowings on long-term debt | 110,000 | 1,617 |
Repayment of long-term debt | (3,500) | (153) |
Payment of finance lease obligations | (179) | (154) |
Proceeds from the exercise of stock options and warrants | 0 | 1,250 |
Repurchase of treasury shares | 0 | (9,539) |
Proceeds from sale of non-controlling interest | 150 | 0 |
Purchase of non-controlling interest | (25) | 0 |
Net cash provided by (used in) financing activities | 106,351 | (7,099) |
Net increase (decrease) in cash and cash equivalents | 41,289 | (13,414) |
Cash, cash equivalents, and restricted cash, beginning of period | 294,152 | 288,027 |
Cash, cash equivalents, and restricted cash, end of period | 335,441 | 274,613 |
Supplemental disclosures of cash flow information | ||
Cash paid for income taxes | 194 | 0 |
Cash paid for interest | 6,430 | 2,991 |
Supplemental disclosures of non-cash investing and financing activities | ||
Business acquisition in accounts payable and accrued liabilities | 63,935 | 3,844 |
Right-of-use assets obtained in exchange for operating lease liabilities | 4,910 | 0 |
Common stock issued in business combination | 21,952 | 0 |
Purchase of investments - equity method in accounts payable and accrued liabilities and other liabilities | 9,487 | 0 |
Draw on letter of credit through Revolver Loan | 4,759 | 0 |
Reconciliation of cash, cash equivalents, and restricted cash | ||
Cash and cash equivalents | 334,796 | 274,613 |
Restricted cash | 645 | 0 |
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows | $ 335,441 | $ 274,613 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business Overview Unless the context dictates otherwise, references in these notes to the financial statements to the “Company,” “we,” “us,” “our,” and similar words are references to Astrana Health, Inc. (“Astrana”), formerly known as Apollo Medical Holdings, Inc., and its consolidated subsidiaries and affiliated entities, as appropriate, including its consolidated variable interest entities (“VIEs”). Headquartered in Alhambra, California, Astrana is a leading provider-centric, technology-powered, risk-bearing healthcare company. Leveraging its proprietary end-to-end technology solutions, Astrana operates an integrated healthcare delivery platform that enables providers to successfully participate in value-based care arrangements, thus empowering them to deliver accessible, high-quality care to patients in a cost-effective manner. Together with Astrana’s affiliated physician groups and consolidated subsidiaries and VIEs, the Company provides value-based care enablement services and care delivery with its consolidated care partners to serve patients in California, Nevada, and Texas, the majority of whom are covered by private or public insurance provided through Medicare, Medicaid, and health maintenance organizations (“HMOs”), with a small portion of our revenue coming from non-insured patients. The Company provides care coordination services to each major constituent of the healthcare delivery system, including patients, families, primary care physicians, specialists, acute care hospitals, alternative sites of inpatient care, physician groups, and health plans. The Company’s physician network consists of primary care physicians, specialist physicians, physician and specialist extenders, and hospitalists. Segments The Company’s three reportable segments are Care Partners, Care Delivery and Care Enablement, which are described as follows: Care Partners The Care Partners segment is focused on building and managing high-quality and high-performance provider networks by partnering with, empowering, and investing in strong provider partners aligned on a shared vision for coordinated care delivery. By leveraging the Company’s unique care enablement platform and ability to recruit, empower, and incentivize physicians to effectively manage total cost of care, the Company is able to organize partnered providers into successful multi-payer risk-bearing organizations that take on varying levels of risk based on total cost of care across membership in all lines of business, including Medicare fee for service (“FFS”), Medicare Advantage, Medicaid, Commercial, and Exchange. Through the Company’s network of “independent practice associations” (“IPAs”), “accountable care organizations” (“ACOs”), and Restricted Knox-Keene licensed health plan, the Company’s healthcare delivery entities are responsible for coordinating and delivering high-quality care to the Company’s patients and ensuring continuity of care in Astrana’s ecosystem across age, stage of life, or life circumstance. Beginning in 2024, in addition to participating in the ACO REACH Model, the Company began participating in the Medicare Shared Savings Program (“MSSP”). The MSSP was created to promote accountability and improve coordination of care for Medicare beneficiaries. Care Delivery The Company’s Care Delivery segment is a patient-centric, data-driven care delivery organization focused on delivering high-quality and accessible care to all patients. The Company’s care delivery organization includes primary care, multi-specialty care, and ancillary care services. This segment includes the following: • Primary care clinics, including post-acute care services; • Multi-specialty care clinics and medical groups, including hospitalist, intensivist, and physician advisory services, cardiac care and diagnostic testing, and specialized care for women’s health; and • Ancillary service providers, such as urgent care centers, outpatient imaging centers, ambulatory surgery centers, and full-service labs. Care Enablement The Company’s Care Enablement segment is an integrated, end-to-end clinical, operational, financial, and administrative platform powered by the Company’s proprietary technology suite that enhances the delivery of high-quality, value-based care to patients and leads to superior clinical and financial outcomes. The Company provides solutions to providers, including independent physicians, provider and medical groups, accountable care organizations, and payers, including health plans and other risk-bearing organizations. The Company’s platform meets providers and payers where they are, with a wide spectrum of solutions across the total cost of care risk spectrum, ranging from solutions for fee-for-service entities to hospital-shared risk-bearing entities, and across patient types, including Medicare, Medicaid, Commercial, and Exchange patients. This segment includes the Company’s wholly owned subsidiaries which operate as management services organizations (“MSOs”), which enter into long-term management and/or administrative services agreements with IPAs, ACOs, clinics, or independent providers. By leveraging the Company’s care enablement platform, providers and payers can improve their ability to deliver high-quality care to their patients and achieve better patient outcomes. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated balance sheet at December 31, 2023, has been derived from the Company’s audited condensed consolidated financial statements, but does not include all annual disclosures required by generally accepted accounting principles in the United States of America (“U.S. GAAP”). The accompanying unaudited condensed consolidated financial statements as of March 31, 2024, and for the three months ended March 31, 2024 and 2023, have been prepared in accordance with U.S. GAAP for interim financial statements and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the audited condensed consolidated financial statements and related notes to the financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 29, 2024. In the opinion of management, all material adjustments (consisting of normal recurring adjustments as well as intercompany accounts and transactions, which have been eliminated) considered necessary for a fair presentation have been made to make the condensed consolidated financial statements not misleading, as required by Regulation S-X, Rule 10-01. Operating results for the three months ended March 31, 2024, are not necessarily indicative of the results that may be expected for the year ending December 31, 2024, or any future periods. Principles of Consolidation The condensed consolidated balance sheets as of March 31, 2024 and December 31, 2023, and the condensed consolidated statements of income for the three months ended March 31, 2024 and 2023, include Astrana’s wholly owned subsidiaries and consolidated variable interest entities (“VIEs”). The unaudited condensed consolidated interim financial statements have been prepared under the assumption that users of the interim financial data have either read or have access to our audited condensed consolidated financial statements for the fiscal year ended December 31, 2023. Use of Estimates The preparation of the condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include collectability of receivables, recoverability of long-lived and intangible assets, business combination and goodwill valuation and impairment, accrual of medical liabilities (incurred but not reported (“IBNR”) claims), determination of hospital shared-risk and health plan shared-risk revenue and receivables (including constraints, completion factors and historical margins), income tax-valuation allowance, share-based compensation, and right-of-use assets and lease liabilities. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ materially from those estimates and assumptions. Business Combinations The Company uses the acquisition method of accounting for all business combinations, which requires assets and liabilities of the acquiree to be recorded at fair value, to measure the fair value of the consideration transferred, including contingent consideration, to be determined on the acquisition date, and to account for acquisition-related costs separately from the business combination. Reportable Segments As of March 31, 2024, the Company operates in three reportable segments: • Care Partners; • Care Delivery; and • Care Enablement. Refer to Note 1 — “Description of Business” and Note 18 — “Segments” to the condensed consolidated financial statements for information on the Company’s segments. Cash and Cash Equivalents The Company’s cash and cash equivalents primarily consist of money market funds and certificates of deposit. The Company considers all highly liquid investments that are both readily convertible into known amounts of cash and mature within ninety days from their date of purchase to be cash equivalents. The Company maintains its cash in deposit accounts with several banks, which at times may exceed the insured limits of the Federal Deposit Insurance Corporation (“FDIC”). The Company believes it is not exposed to any significant credit risk with respect to its cash and cash equivalents and restricted cash. As of March 31, 2024 and December 31, 2023, the Company’s deposit accounts with banks exceeded the FDIC’s insured limit by approximately $353.6 million and $318.9 million, respectively. The Company has not experienced any losses to date and performs ongoing evaluations of these financial institutions to limit the Company’s concentration of risk exposure. Receivables, Receivables – Related Parties, Other Receivables and Loan Receivables The Company’s receivables are comprised of accounts receivable, capitation and claims receivable, risk pool settlements, incentive receivables, management fee income, and other receivables. Accounts receivable are recorded and stated at the amount expected to be collected. The Company’s receivables – related parties are comprised of risk pool settlements, management fee income, and other receivables. Receivables – related parties are recorded and stated at the amount expected to be collected. The Company’s loan receivables consists of promissory notes that accrue interest per annum. As of March 31, 2024, promissory notes are expected to be collected by their maturity dates. Capitation and claims receivables relate to each health plan’s capitation and are received by the Company in the month following the month of service. Risk pool settlements and incentive receivables mainly consist of the Company’s hospital shared-risk pool receivable, which is recorded quarterly based on reports received from the Company’s hospital partners and management’s estimate of the Company’s portion of the estimated risk pool surplus for open performance years. Settlement of risk pool surplus or deficits occurs approximately 18 months after the risk pool performance year is completed. Other receivables consist of receivables from fee-for-service (“FFS”) reimbursement for patient care, certain expense reimbursements, transportation reimbursements from the hospitals, and stop-loss insurance premium reimbursements. The Company maintains reserves for potential credit losses on the receivables. Management reviews the composition of the Company’s receivables and analyzes historical bad debts, customer concentrations, customer creditworthiness, current economic trends, and changes in customer payment patterns to evaluate the adequacy of these reserves. The Company also regularly analyzes the ultimate collectability of accounts receivable after certain stages of the collection cycle using a look-back analysis to determine the amount of receivables subsequently collected and adjustments are recorded when necessary. Reserves are recorded primarily on a specific identification basis. Receivables are recorded when the Company is able to determine amounts receivable under applicable contracts and agreements based on information provided and collection is reasonably likely to occur. In regard to the credit loss standard, the Company continuously monitors its collections of receivables and our expectation is that the historical credit loss experienced across our receivable portfolio is materially similar to any current expected credit losses that would be estimated under the current expected credit losses (“CECL”) model. Concentrations of Credit Risks The Company disaggregates revenue from contracts by service type and payer type. This level of detail provides useful information pertaining to how the Company generates revenue by significant revenue stream and by type of direct contracts. The condensed consolidated statements of income present disaggregated revenue by service type. The following table presents disaggregated revenue generated by payer type for the three months ended March 31, 2024 and 2023 (in thousands): Three Months Ended 2024 2023 Commercial $ 49,512 $ 40,019 Medicare 246,564 216,310 Medicaid 81,263 67,339 Other third parties 27,017 13,576 Revenue $ 404,356 $ 337,244 The Company had major payers that contributed the following percentages of net revenue: Three Months Ended 2024 2023 Payer A 34.0 % 41.5 % Payer B 13.5 % * *Less than 10% of total net revenues The Company had major payers that contributed to the following percentages of receivables and receivables – related parties: As of March 31, As of December 31, Payer A 31.0 % 36.0 % Payer C 33.0 % 41.0 % Revenue Recognition The Company receives payments from the following sources for services rendered: • Commercial insurers; • Federal government under the Medicare program administered by CMS; • State governments under Medicaid and other programs; • Other third-party payers (e.g., hospitals and IPAs); and • Individual patients and clients. Revenue primarily consists of the following: • Capitation revenue; • Risk pool settlements and incentives; • Management fee revenue; and • FFS revenue. Revenue is recorded in the period in which services are rendered or the period in which the Company is obligated to provide services. The form of billing and related risk of collection for such services may vary by type of revenue and the customer. Risk Pool Settlements and Incentives Medicare Shared Savings Program Revenue Beginning in 2024, Astrana participates in MSSP. The MSSP has multiple risk tracks, and Astrana is currently participating in the ENHANCED risk track. Under the MSSP Model, Astrana recruits a group of Participant and Preferred (in-network) Providers. Based on the Participant Providers that join our ACO, CMS grants us a pool of Traditional Medicare patients (beneficiaries) to manage (the “MSSP Aligned Beneficiaries”). The Company’s MSSP Aligned Beneficiaries will receive services from physicians and other medical service providers that are both in-network and out-of-network. CMS continues to pay participant and preferred providers on a fee-for-service basis for Medicare-covered services provided to MSSP Aligned Beneficiaries. The Company continues to bear risk on all Medicare expenditures (both in-network and out-of-network), excluding drug expenditures covered by Medicare Part D, based on a budgetary benchmark established with CMS. Astrana’s shared savings or losses in managing the Company’s beneficiaries are generally determined on an annual basis after reconciliation with CMS. Pursuant to Astrana’s risk-share agreement with CMS, the Company is eligible to receive the surplus (“shared savings”) or is liable for the deficit (“shared losses”) according to the budgetary benchmark established by CMS based on Astrana’s efficiency, or lack thereof, in managing the expenditures associated with the Company’s MSSP Aligned Beneficiaries. The Company estimates the shared service revenue by analyzing the activities during the relevant time period in contemplation of the agreed upon benchmarks, metrics, performance criteria, and attribution criteria based on those and any other contractually defined factors. Revenue is not recorded and is constrained until the shared service revenue can be reasonably estimated by the Company and to the extent that it is probable that a significant reversal will not occur once any uncertainty associated with the variable consideration is subsequently resolved. Income Taxes Federal and state income taxes are computed at currently enacted tax rates less tax credits using the asset and liability method. Deferred taxes are adjusted for both items that do not have tax consequences and for the cumulative effect of any changes in tax rates from those previously used to determine deferred tax assets or liabilities. Tax provisions include amounts that are currently payable, changes in deferred tax assets and liabilities that arise because of temporary differences between the timing of when items of income and expense are recognized for financial reporting and income tax purposes, changes in recognition of tax positions and any changes in the valuation allowance caused by a change in judgment about the realizability of the related deferred tax assets. A valuation allowance is established when necessary to reduce deferred tax assets to amounts expected to be realized. The Company uses a recognition threshold of more-likely-than-not and a measurement attribute on all tax positions taken or expected to be taken in a tax return in order to be recognized in the condensed consolidated financial statements. Once the recognition threshold is met, the tax position is then measured to determine the actual amount of benefit to recognize in the condensed consolidated financial statements. Recent Accounting Pronouncements Not Yet Adopted In November 2023, the Financial Standards Accounting Board (FASB) issued Accounting Standards Update (ASU) 2023-07 "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for the Company’s annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures. In December 2023, the FASB issued ASU 2023-09 "Income Taxes (Topics 740): Improvements to Income Tax Disclosures" to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for the Company’s annual periods beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures. |
Business Combinations, Asset Ac
Business Combinations, Asset Acquisitions, and Goodwill | 3 Months Ended |
Mar. 31, 2024 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations, Asset Acquisitions, and Goodwill | Business Combinations, Asset Acquisitions, and Goodwill Advanced Health Management Systems, L.P. (“AHMS”) On March 31, 2024, the Company, through its wholly owned subsidiary, purchased all of the outstanding general and limited partnership interests of Advanced Health Management Systems, L.P. (“AHMS”). AHMS is engaged in the business of providing management, consulting, administrative and other support services to entities that provide or arrange for the provision of professional healthcare services. In addition, one of AHMS’s wholly owned subsidiaries is a Restricted Knox-Keene licensed health plan with members in the Los Angeles, California area. Total consideration for the acquisition was $63.9 million. As the cash was not paid on the closing date, the purchase price was accrued and presented within accounts payable and accrued expenses in the accompanying condensed consolidated balance sheet as of March 31, 2024. Prime Community Care of Central Valley, Inc. (“PCCCV”) On March 29, 2024, the Company, through its consolidated subsidiary, acquired certain assets of Prime Community Care of Central Valley, Inc., a California professional medical corporation (“PCCCV”). Total consideration of the acquisition was approximately $10.3 million, consisting of cash funded upon the close date and contingent considerations of $2.3 million (“PCCCV contingent considerations”). Refer to Note 19 - “Fair Value Measurements of Financial Instruments” for additional information on contingent considerations. Community Family Care Medical Group IPA, Inc. (“CFC”) On January 31, 2024, the Company, through its consolidated subsidiary, acquired certain assets of CFC. CFC is an IPA that manages the healthcare of members in the Los Angeles, California area. The group serves patients across Medicare, Medicaid, and Commercial payers. The total consideration for the purchase was $120.2 million, consisting of $91.0 million cash funded upon the close date, $22.0 million of the Company’s common stock, resulting in the issuance of 631,712 shares of common stock., and contingent considerations of $7.3 million (“CFC contingent considerations”). Refer to Note 19 - “Fair Value Measurements of Financial Instruments” for additional information on contingent considerations. Advanced Diagnostic and Surgical Center, Inc. (“ADSC”) On January 1, 2024, the Company acquired 95% of the equity interest of Advanced Diagnostic and Surgical Center, Inc. (“ADSC”). ADSC is a diagnostic and surgical center that also provides ambulatory surgery services. The total consideration consisted of cash funded upon close of the transaction and contingent considerations of $3.6 million (“ADSC contingent considerations”). Refer to Note 19 - “Fair Value Measurements of Financial Instruments” for additional information on contingent considerations. The Company is still in the process of finalizing the purchase price allocation for these acquisitions, and therefore, the balances are subject to change as a result of any working capital or fair value adjustments, and seller indemnification obligations. The following table summarizes the preliminary purchase price allocation of the fair value of assets acquired and liabilities assumed related to each acquisition at the acquisition date (in thousands): CFC AHMS Others * Net Total Total purchase consideration: Cash paid $ 90,998 $ — $ 12,500 $ 103,498 Cash payable — 63,935 — 63,935 Contingent consideration 7,264 — 5,897 13,161 Common stock issued 21,952 — — 21,952 $ 120,214 $ 63,935 $ 18,397 $ 202,546 Assets: Cash and cash equivalents $ 16,674 $ 33,950 $ 3,515 $ 54,139 Investment in marketable securities 50 — 30 80 Receivables 5,351 11,847 — 17,198 Prepaid expenses and other current assets — 36 11 47 Amounts due from affiliates 3,909 — — 3,909 Land, property and equipment — — 823 823 Intangible assets 26,000 23,800 2,703 52,503 Goodwill 90,148 29,876 12,318 132,342 Restricted cash — 300 — 300 Total identifiable assets acquired $ 142,132 $ 99,809 $ 19,400 $ 261,341 Liabilities: Accounts payable and accrued expenses $ 4,376 $ 7,232 $ 250 $ 11,858 Medical liabilities 17,508 13,137 — 30,645 Amounts due to affiliates — 7,241 54 7,295 Income taxes payable 34 1,604 — 1,638 Deferred tax liability — 6,660 271 6,931 Noncontrolling interest — — 428 428 Total identified liabilities assumed $ 21,918 $ 35,874 $ 1,003 $ 58,795 Total net identifiable assets acquired $ 120,214 $ 63,935 $ 18,397 $ 202,546 * Others consist of estimated fair values of the assets acquired, net of cash acquired, related to ADSC and PCCCV. Unaudited Pro Forma Financial Information The pro forma financial information in the table below presents the combined results of the Company and CFC, AHMS, ADSC and PCCCV as if the acquisitions had occurred on January 1, 2023. The pro forma information presented is shown for illustrative purposes only and is not necessarily indicative of future results of operations of the Company or results of operations of the Company that would have actually occurred had the transactions been in effect for the periods presented. Three Months Ended (in thousands, except per share amounts) 2024 2023 Total revenue $ 493,006 $ 382,462 Net income $ 16,661 $ 20,324 Net income per share - basic $ 0.35 $ 0.44 Net income per share - diluted $ 0.35 $ 0.43 The acquisitions were accounted for under the acquisition method of accounting. The fair value of the consideration for the acquired companies was allocated to acquired tangible and intangible assets and liabilities based upon their fair values. The excess of the purchase consideration over the fair value of the net tangible and identifiable intangible assets acquired was recorded as goodwill. Factors leading to goodwill being recognized are the Company’s expectation of synergies from combining operations of entities acquired and the Company, as well as the value of intangible assets that are not separately recognized, such as assembled workforce. The determination of the fair value of assets and liabilities acquired requires the Company to make estimates and use valuation techniques when market value is not readily available. The results of operations from the acquisitions have been included in the Company’s financial statements from the date of acquisition. Transaction costs associated with business acquisitions are expensed as they are incurred. At the time of acquisition, the Company estimates the amount of the identifiable intangible assets based on a valuation and the facts and circumstances available at the time. The Company determines the final value of the identifiable intangible assets as soon as information is available, but not more than one year from the date of acquisition. Goodwill is not deductible for tax purposes. The Company had no impairment of its goodwill or indefinite-lived intangible assets during the three months ended March 31, 2024 and 2023. The change in the carrying value of goodwill for the three months ended March 31, 2024 was as follows (in thousands): Amount Balance, January 1, 2024 $ 278,831 Acquisitions 132,342 Adjustments (906) Balance, March 31, 2024 $ 410,267 |
Intangible Assets, Net
Intangible Assets, Net | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets, Net | Intangible Assets, Net At March 31, 2024, the Company’s intangible assets, net, consisted of the following (in thousands): Useful Life (Years) Gross March 31, Accumulated Net March 31, Indefinite lived assets: Trademarks N/A $ 2,150 $ — $ 2,150 Licenses N/A 1,900 — 1,900 Amortized intangible assets: Network relationships 11-21 155,978 (107,137) 48,841 Management contracts 15 22,832 (17,002) 5,830 Member relationships 7-14 69,381 (9,154) 60,227 Patient management platform 5 2,060 (2,060) — Tradename/trademarks 20 1,011 (320) 691 Developed technology 6 107 (39) 68 $ 255,419 $ (135,712) $ 119,707 At December 31, 2023, the Company’s intangible assets, net, consisted of the following (in thousands): Useful Life (Years) Gross December 31, Accumulated Net December 31, 2023 Indefinite lived assets: Trademarks N/A $ 2,150 $ — $ 2,150 Amortized intangible assets: Network relationships 11-21 150,679 (104,859) 45,820 Management contracts 15 22,832 (16,662) 6,170 Member relationships 10-14 24,077 (7,345) 16,732 Patient management platform 5 2,060 (2,060) — Tradename/trademarks 20 1,011 (308) 703 Developed technology 6 107 (34) 73 $ 202,916 $ (131,268) $ 71,648 For the three months ended March 31, 2024 and 2023, the Company recognized amortization expenses of $4.4 million and $3.0 million, respectively, in depreciation and amortization on the accompanying condensed consolidated statements of income. The Company determined that there was no impairment of its finite-lived intangible or long-lived assets during the three months ended March 31, 2024 and 2023. Future amortization expense is estimated to be as follows for the following years ending December 31 (in thousands): Amount 2024 (excluding the three months ended March 31, 2024) $ 20,144 2025 22,373 2026 18,178 2027 14,746 2028 12,085 Thereafter 28,131 Total $ 115,657 |
Investments in Other Entities
Investments in Other Entities | 3 Months Ended |
Mar. 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Other Entities | Investments in Other Entities Equity Method For the three months ended March 31, 2024 and 2023, the Company’s equity method investment balance consisted of the following (in thousands): % of Ownership December 31, Initial Investment Allocation of Net Income Distribution March 31, 2024 LaSalle Medical Associates – IPA line of business 25% $ 9,866 $ — $ 359 $ — $ 10,225 Pacific Medical Imaging & Oncology Center, Inc. 40% 1,691 — 27 — 1,718 CAIPA MSO, LLC 30% 13,660 — 186 — 13,846 I Health, Inc. 25% — 9,487 — — 9,487 Other * 25% 557 — 60 — 617 $ 25,774 $ 9,487 $ 632 $ — $ 35,893 % of Ownership December 31, Initial Investment Allocation of Net Income (Loss) Distribution March 31, 2023 LaSalle Medical Associates – IPA line of business 25% $ 5,684 $ — $ 2,165 $ — $ 7,849 Pacific Medical Imaging & Oncology Center, Inc. 40% 1,878 — 8 — 1,886 531 W. College, LLC ** 50% 17,281 — (90) — 17,191 One MSO, LLC ** 50% 2,718 — 115 — 2,833 CAIPA MSO, LLC 30% 12,738 — 249 — 12,987 Other * 25% — 325 37 — 362 $ 40,299 $ 325 $ 2,484 $ — $ 43,108 * Other consists of smaller equity method investments. ** Investment were solely for the benefit of APC and its shareholders. I Health, Inc. On March 31, 2024, a wholly owned subsidiary of the Company acquired a 25% equity interest in I Health, Inc. (“I Health”), a management service organization. The Company accounts for its investment in I Health under the equity method of accounting as the Company has the ability to exercise significant influence, but not control over I Health’s operations. The purchase agreement includes a call option that allows the Company to purchase an additional 25% equity interest on each of the first, second and third anniversary of the purchase (“I Health Call Option”). The cash consideration was not paid on the closing date, and was accrued and presented within accounts payable and accrued expenses and other liabilities in the accompanying condensed consolidated balance sheets. There was no impairment loss recorded related to equity method investments for the three months ended March 31, 2024 and 2023. |
Loans Receivable
Loans Receivable | 3 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
Loans Receivable | Loans Receivable Loans receivable IntraCare In July 2023, the Company entered into a five-year convertible promissory note with IntraCare as the borrower. The principal on the note is $25.0 million, with interest on the outstanding principal amount and unpaid interest at a rate per annum equal to 8.81%, compounded annually. In the event that the convertible promissory note remains outstanding on or after the maturity date of July 27, 2028, the outstanding principal balance and any unpaid accrued interest shall, upon the election of the Company, convert into IntraCare preferred shares. BASS Medical Group On January 29, 2024, the Company provided BASS Medical Group (“BASS”) with a $20.0 million senior secured promissory note (“BASS secured promissory note”). The promissory note is secured by certain assets of BASS. BASS secured promissory note matures on January 11, 2031, and has an interest rate per annum equal to 8.21% compounded annually. The principal on the note, including unpaid interest, are due and payable on the maturity date. The Company assessed the outstanding loans receivable under the CECL model by assessing the party’s ability to pay by reviewing their interest payment history quarterly, financial history annually, and reassessing any identified insolvency risk. |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | Accounts Payable and Accrued Expenses The Company’s accounts payable and accrued expenses consisted of the following (in thousands): March 31, December 31, Accounts payable and other accruals $ 84,867 $ 9,075 Capitation payable 10,225 4,503 Subcontractor IPA payable 2,529 2,529 Professional fees 5,293 4,407 Due to related parties 11,679 9,271 Contract liabilities 3,017 744 Accrued compensation 12,410 20,098 Other provider payable 16,453 9,322 Total accounts payable and accrued expenses $ 146,473 $ 59,949 |
Medical Liabilities
Medical Liabilities | 3 Months Ended |
Mar. 31, 2024 | |
Liability for Unpaid Claims and Claims Adjustment Expense, Activity in Liability [Abstract] | |
Medical Liabilities | Medical Liabilities The Company’s medical liabilities consisted of the following (in thousands): March 31, March 31, Medical liabilities, beginning of period $ 106,657 $ 81,255 Acquired (see Note 3) 30,645 — Components of medical care costs related to claims incurred: Current period 235,237 223,713 Prior periods (1,419) (8,950) Total medical care costs 233,818 214,763 Payments for medical care costs related to claims incurred: Current period (136,286) (136,743) Prior periods (97,837) (61,736) Total paid (234,123) (198,479) Adjustments (503) 857 Medical liabilities, end of period $ 136,494 $ 98,396 |
Credit Facility, Bank Loans, an
Credit Facility, Bank Loans, and Lines of Credit | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Credit Facility, Bank Loans, and Lines of Credit | Credit Facility, Bank Loans, and Lines of Credit The Company’s debt balance consisted of the following (in thousands): March 31, 2024 December 31, 2023 Term Loan $ 296,500 $ 280,000 Revolver Loan 94,759 — Promissory Note Payable 2,000 2,000 Total debt 393,259 282,000 Less: Current portion of debt (20,750) (19,500) Less: Unamortized financing costs (4,061) (3,561) Long-term debt $ 368,448 $ 258,939 The estimated fair value of our long-term debt was determined using Level 2 inputs primarily related to comparable market prices. As of March 31, 2024, and December 31, 2023, the carrying value was not materially different from fair value, as the interest rates on the Company’s debt approximated rates currently available to the Company. The following are the future commitments of the Company’s debt for the years ending December 31 (in thousands): Amount 2024 (excluding the three months ended March 31, 2024) $ 17,000 2025 16,875 2026 117,259 2027 24,375 2028 217,750 Total $ 393,259 Amended Credit Facility Amended Credit Agreement On June 16, 2021, the Company entered into an amended and restated credit agreement (as subsequently amended as described below, the “Amended Credit Agreement”) with Truist Bank, in its capacity as administrative agent for the lenders, issuing bank, swingline lender and lender, and the banks and other financial institutions from time to time party thereto, to, among other things, to amend and restate that certain credit agreement, dated September 11, 2019, by and among the Company, Truist Bank, and certain lenders thereto, in its entirety. The Amended Credit Agreement provides for a five-year revolving credit facility (the “Amended Credit Facility”) to the Company of $400.0 million (“Revolver Loan”), which includes a letter of credit sub-facility of up to $25.0 million (which was amended to $50.0 million, as described below) and a swingline loan sub-facility of $25.0 million and which expires on June 16, 2026. As of March 31, 2024, the Company borrowed $94.8 million on the Revolver Loan. On December 20, 2022, an amendment was made to the Amended Credit Agreement, in which all amounts borrowed under the Amended Credit Agreement as of the effective date were automatically converted from London Interbank Offer Rate (“LIBOR”) Loans to Secured Overnight Financing Rate (“SOFR”) Loans with an initial interest period of one month on and as of the amendment effective date. Amounts borrowed under the Revolver Loan bear interest at an annual rate equal to either, at the Company’s option, (a) the Term SOFR Reference Rate (as defined in the Amended Credit Agreement), adjusted for any Term SOFR Adjustment (as defined in the Amended Credit Agreement) plus a spread ranging from 1.25% to 2.50%, as determined on a quarterly basis based on the Company’s Consolidated Total Net Leverage Ratio (as defined in the Amended Credit Agreement), or (b) a base rate, plus a spread ranging from 0.25% to 1.50%, as determined on a quarterly basis based on the Company’s Consolidated Total Net Leverage Ratio. As of March 31, 2024, the interest rate on the Revolver Loan was 7.42%. On September 8, 2023, a Second Amendment to the Amended Credit Agreement was entered into, which, among other things, increased the letter of credit sub-facility from $25.0 million to $50.0 million. On November 3, 2023, the Company entered into a Third Amendment to the Amended Credit Agreement (“Third Amendment”) with Truist Bank and the other financial institutions party thereto. The Third Amendment provided a new term loan to the Company in an aggregate amount of up to $300.0 million, with $180.0 million funded at the closing of the Third Amendment, and $120.0 million available to be drawn by the Company as delayed draw loans during the six months subsequent to the closing of the Third Amendment (collectively, the “Term Loan”). The Term Loan matures on November 3, 2028 (or such earlier date on which it is terminated in accordance with the provisions of the Amended Credit Agreement) and amortizes quarterly at 5% per annum for each of the first two years, 7.5% per annum for years three and four, and 10% per annum for year five. As of March 31, 2024, the Company borrowed $296.5 million on the Term Loan. The Term Loan bears interest at an annual rate equal to either, at the Company’s option, (a) the Term SOFR Reference Rate, adjusted for any Term SOFR Adjustment, plus a spread from 1.50% to 2.75%, as determined on a quarterly basis based on the Company’s Consolidated Total Net Leverage Ratio, or (b) a base rate, plus a spread of 0.50% to 1.75%, as determined on a quarterly basis based on the Company’s Consolidated Total Net Leverage Ratio. As of March 31, 2024, the interest rate on the Term Loan was 7.68%. The Amended Credit Agreement requires the Company to comply with two key financial ratios, each calculated on a consolidated basis. The Company must maintain a maximum consolidated total net leverage ratio of not greater than 3.75 to 1.00 as of the last day of each fiscal quarter, provided that for any fiscal quarter during which the Company or certain subsidiaries consummate a permitted acquisition or investment, the aggregate purchase price is greater than $75.0 million, the maximum consolidated total net leverage ratio may temporarily increase by 0.25 to 1.00 to 4.00 to 1.00. The Company must maintain a minimum consolidated interest coverage ratio of not less than 3.25 to 1.00 as of the last day of each fiscal quarter. Under the Amended Credit Agreement, the terms and conditions of the Guaranty and Security Agreement (the “Guaranty and Security Agreement”) between the Company, Astrana Health Management, Inc. (“AHM”) and Truist Bank remain in effect. Pursuant to the Guaranty and Security Agreement, the Company and AHM have granted the lenders under the Amended Credit Agreement a security interest in substantially all of their assets to secure obligations under the Amended Credit Agreement, including, without limitation, all stock and other equity issued by their subsidiaries (including AHM) and all rights with respect to the $545.0 million loan from the Company to Astrana Medical. Promissory Note Payable FYB Promissory Note Agreement with CCHCA In May 2021, For Your Benefit, Inc. entered into a promissory note agreement with Chinese Community Health Care Association. The principal on the promissory note is $2.0 million, with a maturity date of May 9, 2024. The interest rate is the prime rate plus 1.0%. The prime rate is updated annually on the effective date of the note and published by the Wall Street Journal . Deferred Financing Costs At March 31, 2024, and December 31, 2023, the unamortized deferred financing cost was $5.7 million and $6.1 million, respectively. As of March 31, 2024 and December 31, 2023, $1.6 million and $2.6 million, respectively, of unamortized deferred financing costs was recognized in prepaid expenses and other current assets in the accompanying condensed consolidated balance sheets and consisted of unamortized deferred financing costs related to unborrowed amounts available on the Revolver Loan. As of March 31, 2024, and December 31, 2023, $4.1 million and $3.6 million, respectively, of unamortized deferred financing costs was recorded as a direct reduction against the amounts borrowed on the Term Loan and Revolver. Effective Interest Rate The Company’s average effective interest rate on its total debt during the three months ended March 31, 2024 and 2023, was 6.51% and 5.69%, respectively. Interest expense in the condensed consolidated statements of income included amortization of deferred debt issuance costs for the three months ended March 31, 2024 and 2023 of $0.5 million and $0.2 million, respectively. Lines of Credit APC Business Loan On September 10, 2019, the APC Business Loan Agreement with Preferred Bank (the “APC Business Loan Agreement”) was amended to, among other things, decrease loan availability to $4.1 million, limit the purpose of the indebtedness under the APC Business Loan Agreement to the issuance of standby letters of credit, and include as a permitted lien, the security interest in all of its assets that APC granted to AHM under a Security Agreement dated on or about September 11, 2019, securing APC’s obligations to AHM under their management services agreement dated as of July 1, 1999, as amended. Standby Letters of Credit The Company established irrevocable standby letters of credit with Truist Bank under the Amended Credit Agreement for a total of $31.8 million for the benefit of CMS and certain health plans. Unless the institution provides notification that the standby letters of credit will be terminated prior to the expiration date, the letters will be automatically extended without amendment for additional one-year periods from the present or any future expiration date. Certain IPAs consolidated by the Company established irrevocable standby letters of credit with Preferred Bank under the APC Business Loan Agreement for a total of $3.9 million for the benefit of certain health plans as of March 31, 2024. The standby letters of credit are automatically extended without amendment for additional one-year periods from the present or any future expiration date, unless notified by the institution in advance of the expiration date that the letter will be terminated. |
Mezzanine and Stockholders' Equ
Mezzanine and Stockholders' Equity | 3 Months Ended |
Mar. 31, 2024 | |
Stockholders' Equity Note [Abstract] | |
Mezzanine and Stockholders' Equity | Mezzanine and Stockholders’ Equity Mezzanine Equity APC As the redemption feature of the APC shares is not solely within the control of APC, the equity of APC does not qualify as permanent equity and has been classified as non-controlling interests in APC as mezzanine or temporary equity. APC’s shares were not redeemable, and it was not probable that the shares would become redeemable as of March 31, 2024 and December 31, 2023. Stockholders’ Equity As of March 31, 2024, 41,048 holdback shares have not been issued to certain former AHM shareholders who were AHM shareholders at the time of closing of the 2017 merger of Astrana with AHM, as they have yet to submit properly completed letters of transmittal to Astrana in order to receive their pro rata portion of Astrana common stock as contemplated under the 2017 merger agreement. Pending such receipt, such former AHM shareholders have the right to receive, without interest, their pro rata share of dividends or distributions with a record date after the effectiveness of the 2017 Merger. The condensed consolidated financial statements have treated such shares of common stock as outstanding, given the receipt of the letter of transmittal is considered perfunctory and the Company is legally obligated to issue these shares in connection with the 2017 merger. Treasury Stock As of March 31, 2024, and December 31, 2023, APC owned 7,132,698 shares of Astrana’s common stock. While such shares of Astrana’s common stock are legally issued and outstanding, they are treated as treasury shares for accounting purposes and excluded from shares of common stock outstanding in the condensed consolidated financial statements. APC’s ownership in Astrana was 13.04% and 13.22% as of March 31, 2024, and December 31, 2023, respectively. As of March 31, 2024, and December 31, 2023, the Company had previously repurchased 3,451,642 shares of its common stock. These are included as treasury stock. As of both March 31, 2024, and December 31, 2023, the total treasury stock, including the Company’s stock held by APC, was 10,584,340. Dividends During the three months ended March 31, 2024 and 2023, certain consolidated subsidiaries of the Company paid distributions of $0.1 million and $0.1 million, respectively, to the shareholders who own the non-controlling interests in the entities. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The following table summarizes the stock-based compensation expense recognized under all of the Company’s stock plans for the three months ended March 31, 2024 and 2023, and associated with the issuance of restricted shares of common stock and vesting of stock options that are included in general and administrative expenses in the accompanying condensed consolidated statements of income (in thousands): Three Months Ended 2024 2023 Stock options $ 349 $ 566 Restricted stock 5,399 2,879 Total stock-based compensation expense $ 5,748 $ 3,445 Unrecognized compensation expense related to total share-based payments outstanding as of March 31, 2024, was $42.4 million. Options The Company’s outstanding stock options consisted of the following: Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Aggregate Options outstanding at January 1, 2024 504,241 $ 34.03 2.1 $ 4.7 Options granted — — — — Options exercised — — — — Options forfeited (7,271) 50.56 — — Options outstanding at March 31, 2024 496,970 $ 33.79 1.61 $ 8.4 Options exercisable at March 31, 2024 459,140 $ 28.04 1.41 $ 8.4 During the three months ended March 31, 2024, no options were exercised. During the three months ended March 31, 2023, options were exercised for 125,000 shares of the Company’s common stock, resulting in proceeds of $1.3 million. Restricted Stock The Company grants restricted stock to officers and employees, which is earned based on service conditions. The grant date fair value of the restricted stock is the grant date’s closing market price of the Company’s common stock. During the three months ended March 31, 2024, the Company granted 296,428 shares of restricted stock with performance-based conditions and 255,781 shares of restricted stock without performance-based conditions. During the three months ended March 31, 2024, the weighted average grant date fair value of restricted stock with and without performance-based conditions was $43.88 and $40.65, respectively. Employee Stock Purchase Plan (“ESPP”) |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Regulatory Matters Laws and regulations governing the Medicare program and healthcare generally are complex and subject to interpretation. The Company believes it complies with all applicable laws and regulations and is unaware of any pending or threatened investigations involving allegations of potential wrongdoing. While no regulatory inquiries have been made, compliance with such laws and regulations can be subject to future government review and interpretation, as well as significant regulatory action, including fines, penalties, and exclusion from the Medicare and Medi-Cal programs. As a risk-bearing organization, the Company is required to follow regulations of the Department of Managed Health Care (“DMHC”). The Company must comply with a minimum working capital requirement, tangible net equity (“TNE”) requirement, cash-to-claims ratio, and claims payment requirements prescribed by the DMHC. TNE is defined as net assets less intangibles, less non-allowable assets (which include amounts due from affiliates), plus subordinated obligations. Many of the Company’s payer and provider contracts are complex in nature and may be subject to differing interpretations regarding amounts due for the provision of medical services. Such differing interpretations may not come to light until a substantial period of time has passed following contract implementation. Liabilities for claims disputes are recorded when the loss is probable and can be estimated. Any adjustments to reserves are reflected in current operations. Standby Letters of Credit The Company established irrevocable standby letters of credit with Truist Bank for a total of $31.8 million for the benefit of CMS and certain health plans as of March 31, 2024 (see Note 9 — “Credit Facility, Bank Loans, and Lines of Credit — Standby Letters of Credit”). Certain IPAs consolidated by the Company established irrevocable standby letters of credit with Preferred Bank for a total of $3.9 million for the benefit of certain health plans as of March 31, 2024 (see Note 9 — “Credit Facility, Bank Loans, and Lines of Credit — Standby Letters of Credit”). Litigation From time to time, the Company is involved in various legal proceedings and other matters arising in the normal course of its business. The resolution of any claim or litigation is subject to inherent uncertainty and could have a material adverse effect on the Company’s financial condition, cash flows, or results of operations. Liability Insurance The Company believes that its insurance coverage is appropriate based upon the Company’s claims experience and the nature and risks of the Company’s business. In addition to the known incidents that have resulted in the assertion of claims, the Company cannot be certain that its insurance coverage will be adequate to cover liabilities arising out of claims asserted against the Company, the Company’s affiliated professional organizations or the Company’s affiliated hospitalists in the future where the outcomes of such claims are unfavorable. The Company believes that the ultimate resolution of all pending claims, including liabilities in excess of the Company’s insurance coverage, will not have a material adverse effect on the Company’s financial position, results of operations, or cash flows; however, there can be no assurance that future claims will not have such a material adverse effect on the Company’s business. Contracted physicians are required to obtain their own insurance coverage. Although the Company currently maintains liability insurance policies on a claims-made basis which are intended to cover malpractice liability and certain other claims, the coverage must be renewed annually, and may not continue to be available to the Company in future years at acceptable costs and on favorable terms. |
Related-Party Transactions
Related-Party Transactions | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party Transactions Equity Method Investments During the three months ended March 31, 2023, AHM recognized approximately $5.0 million in management fees from LMA. On August 31, 2023, the management service agreement between LMA’s IPA and AHM was terminated. LMA is accounted for under the equity method based on the 25% equity ownership interest held by APC in LMA’s IPA line of business (see Note 5 — “Investments in Other Entities - Equity Method”). During the three months ended March 31, 2024 and 2023, APC paid approximately $0.8 million and $0.6 million, respectively, to PMIOC for provider services. APC and PMIOC have an Ancillary Service Contract together whereby PMIOC provides covered services on behalf of APC to enrollees of the plans of APC. PMIOC is accounted for under the equity method based on the 40% equity ownership interest held by APC (see Note 5 — “Investments in Other Entities — Equity Method”). During the three months ended March 31, 2024 and 2023, the Company paid approximately $0.2 million and $0.2 million, respectively, to James Song, M.D., a Professional Corporation (“Song PC”) for provider services. Song PC is accounted for under the equity method based on the 25% equity ownership interest held by Astrana, as Astrana has the ability to exercise significant influence, but not control over, Song PC’s operations. Astrana Board Members and Officers During the three months ended March 31, 2024 and 2023, AHM recognized approximately $0.5 million and $0.5 million, respectively, in management fees from Arroyo Vista Family Health Center (“Arroyo Vista”). The Company has a managed service agreement with Arroyo Vista. Arroyo Vista’s chief executive officer is a member of the Company’s board of directors. During the three months ended March 31, 2024 and 2023, the Company paid approximately $0.1 million and $64,000, respectively, to Arroyo Vista for services as a provider. The Company has provider contracts with Arroyo Vista. During the three months ended March 31, 2024 , the Company incurred rent expenses of approximately $0.9 million from certain properties that are managed by Allied Pacific Holdings Investment Management, LLC. During the three months ended March 31, 2023, the Company incurred $0.9 million in rent expense from the same properties, but it was eliminated upon consolidation. These properties were previously consolidated by Astrana until they were spun off on December 26, 2023. The chief executive officer of the real estate business managing these properties is also a member of the Company’s board of directors. As of March 31, 2024 and December 31, 2023, the Company’s operating right-of-use asset balance included $12.7 million and $14.1 million, respectively, and the Company’s operating lease liabilities included $13.2 million and $14.5 million, respectively, for certain properties that are managed by Allied Pacific Holdings Investment Management, LLC. During the three months ended March 31, 2024 and 2023, the Company incurred approximately $0.6 million and $0.4 million in expenses payable to Third Way Health for call center services. One of Astrana’s officers is a board member of Third Way Health. During the three months ended March 31, 2024 and 2023, the Company paid approximately $45,000 and $0.2 million, respectively, to Sunny Village Care Center for services as a provider. The Company has provider contracts with Sunny Village Care Center. Sunny Village Care Center shares common ownership with certain Astrana board members. During the three months ended March 31, 2023, Astrana paid approximately $9.5 million to purchase Astrana’s stock from a board member. The Company did not make any similar purchases during the three months ended March 31, 2024. During the three months ended March 31, 2024, the Company incurred rent expenses of approximately $38,000 to First Commonwealth Property, LLC for an office lease. First Commonwealth Property, LLC shares common ownership with certain board members of APC and AHM. The Company has agreements with Health Source MSO Inc., a California corporation (“HSMSO”), Aurion Corporation (“Aurion”), and AHMC for services provided to the Company. One of the Company’s board members is an officer of AHMC, HSMSO, and Aurion. Aurion is also partially owned by one of the Company’s board members. Revenue with AHMC and HSMSO consists of capitation, risk pool, and miscellaneous fees and expenses consisting of claims expenses, management fees, and consulting fees. The following table sets forth revenue recognized and fees incurred related to AHMC, HSMSO, and Aurion for the three months ended March 31, 2024 and 2023 (in thousands): Three months ended March 31, 2024 Three months ended March 31, 2023 AHMC HSMSO Aurion AHMC HSMSO Aurion Revenue $ 9,920 $ 301 $ — $ 14,484 $ 315 $ — Expenses 7,557 — 50 6,400 169 50 Net $ 2,363 $ 301 $ (50) $ 8,084 $ 146 $ (50) The Company and AHMC have a risk-sharing agreement with certain AHMC hospitals to share the surplus and deficits of each of the hospital pools. Under this agreement, during the three months ended March 31, 2024 and 2023, the Company has recognized risk pool revenues of $8.1 million and $13.0 million, respectively. The Company has a risk pool receivable balance of $58.8 million and $54.0 million as of March 31, 2024 and December 31, 2023, respectively. APC Board Members During the three months ended March 31, 2024 and 2023, the Company paid an aggregate of approximately $4.7 million and $9.4 million, respectively, to board members for provider services which included approximately $0.8 million and $0.9 million, respectively, to Astrana board members and officers who are also board members and officers of APC. In addition, affiliates wholly owned by the Company’s key personnel are reported in the accompanying condensed consolidated statements of income on a consolidated basis, together with the Company’s subsidiaries, and therefore, the Company does not separately disclose transactions between such affiliates and the Company’s subsidiaries as related-party transactions. Intercompany Transactions Because of corporate practice of medicine laws, the Company uses designated shareholder professional corporations, of which the sole shareholder is a member of the Company’s key personnel, to engage in certain transactions and make intercompany loans from time to time. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company uses the liability method of accounting for income taxes as set forth in ASC 740 Income Taxes. Under the liability method, deferred taxes are determined based on differences between the financial statement and tax bases of assets and liabilities using enacted tax rates. On an interim basis, the Company estimates what its anticipated annual effective tax rate will be and records a quarterly income tax provision in accordance with the estimated annual rate, plus the tax effect of certain discrete items that arise during the quarter. As the fiscal year progresses, the Company refines its estimates based on actual events and financial results during the quarter. This process can result in significant changes to the Company’s estimated effective tax rate. When this occurs, the income tax provision is adjusted during the quarter in which the estimates are refined so that the year-to-date provision reflects the estimated annual effective tax rate. These changes, along with adjustments to the Company’s deferred taxes and related valuation allowance, may create fluctuations in the overall effective tax rate from quarter to quarter. The Company’s effective income tax rate for the three months ended March 31, 2024 and 2023, was 29.8% and 35.7%, respectively. The tax rate for the three months ended March 31, 2024, differed from the U.S. federal statutory rate primarily due to state income taxes and income from flow-through entities. As of March 31, 2024, the Company does not have any unrecognized tax benefits related to various federal and state income tax matters. The Company will recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share is calculated using the weighted average number of shares of the Company’s common stock issued and outstanding during a certain period, and is calculated by dividing net income attributable to Astrana by the weighted average number of shares of the Company’s common stock issued and outstanding during such period. Diluted earnings per share is calculated using the weighted average number of shares of common stock and potentially dilutive shares of common stock outstanding during the period, using the as-if converted method for secured convertible notes and preferred stock, and the treasury stock method for options and common stock warrants. As of March 31, 2024 and December 31, 2023, APC held 7,132,698 shares of Astrana’s common stock, which are treated as treasury shares for accounting purposes and not included in the number of shares of common stock outstanding used to calculate earnings per share. For the three months ended March 31, 2024 and 2023, restricted stock of 118,142 and 136,932, respectively, were excluded from the computation of diluted weighted average common shares outstanding because the assumed proceeds, as calculated under the treasury stock method, resulted in these awards being antidilutive. For the three months ended March 31, 2024 and 2023, 973,461 and 395,472 of contingently issuable shares were excluded from the computation of diluted weighted average common shares outstanding because these conditions were not achieved as of March 31, 2024 and 2023, respectively. Below is a summary of the earnings per share computations: Three Months Ended March 31, 2024 2023 Earnings per share – basic $ 0.31 $ 0.28 Earnings per share – diluted $ 0.31 $ 0.28 Weighted average shares of common stock outstanding – basic 47,260,351 46,555,406 Weighted average shares of common stock outstanding – diluted 47,699,537 46,954,687 Below is a summary of the shares included in the diluted earnings per share computations: Three Months Ended March 31, 2024 2023 Weighted average shares of common stock outstanding – basic 47,260,351 46,555,406 Stock options 188,083 306,933 Restricted stock 225,128 48,191 Contingently issuable shares 25,975 44,157 Weighted average shares of common stock outstanding – diluted 47,699,537 46,954,687 |
Variable Interest Entities (VIE
Variable Interest Entities (VIEs) | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities (VIEs) | Variable Interest Entities (VIEs) The Company’s condensed consolidated financial statements include its subsidiaries and consolidated VIEs. A VIE is defined as a legal entity whose equity owners do not have sufficient equity at risk, or, as a group, the holders of the equity investment at risk lack any of the following three characteristics: decision-making rights, the obligation to absorb losses, or the right to receive the expected residual returns of the entity. The primary beneficiary is identified as the variable interest holder that has both the power to direct the activities of the VIE that most significantly affect the entity’s economic performance and the obligation to absorb expected losses or the right to receive benefits from the entity that could potentially be significant to the VIE. Certain state laws prohibit a professional corporation that has more than one shareholder from being a shareholder in another professional corporation. As a result, the Company cannot directly own shares in other professional corporations. However, an exception to this regulation permits a professional corporation that has only one shareholder to own shares in another professional corporation. In reliance on this exception, the Company designated certain key personnel as the nominee shareholders of professional corporations that hold controlling and non-controlling ownership interests in several medical corporations. Via a Physician Shareholder Agreement with the nominee shareholder, the Company has the ability to designate another person to be the equity holder of the professional corporation. In addition, these entities are managed by the Company’s wholly owned MSOs via MSA. In accordance with relevant accounting guidance, the professional corporations and their consolidated medical corporations are consolidated by the Company in the accompanying condensed financial statements. Due to corporate practice of medicine laws, the Company operates by maintaining long-term MSAs with its affiliated IPAs and medical groups, each of which is owned and operated by physicians only, and employs or contracts with additional physicians to provide medical services. AHM is a wholly owned subsidiary of the Company and has entered into MSAs with several affiliated IPAs, including APC. APC arranges for the delivery of healthcare services by contracting with physicians or professional medical corporations for primary care and specialty care services. The physicians in the IPA are exclusively in control of, and responsible for, all aspects of the practice of medicine for enrolled patients. In accordance with relevant accounting guidance, APC has been determined to be a VIE of AHM, as AHM is its primary beneficiary with the ability, through majority representation on the APC Joint Planning Board and otherwise, to direct the activities (excluding clinical decisions) that most significantly affect APC’s economic performance. Therefore, APC and its wholly owned subsidiaries and VIEs are consolidated in the accompanying financial statements. Astrana Medical and Astrana Care Partners Medical were formed in May 2019 and July 2021, respectively, as designated shareholder professional corporations. The Company’s Vice Chairman is the sole shareholder of Astrana Medical and Astrana Care Partners Medical. Via a Physician Shareholder Agreement, Astrana makes all the decisions on behalf of Astrana Medical and Astrana Care Partners Medical. Astrana has the obligation to absorb losses of, or the right to receive benefits from, Astrana Medical and Astrana Care Partners Medical. Therefore, Astrana Medical and Astrana Care Partners Medical are controlled by and consolidated by Astrana as the primary beneficiary of the VIEs. On January 1, 2024, a 25% equity interest of Eleanor Leung M.D. was re-acquired by the Company. As a result, Astrana Care Partners Medical now owns 100% of Eleanor Leung M.D. The following table includes assets that can only be used to settle the liabilities of the Company’s VIEs, and to which the creditors of Astrana have no recourse, and liabilities to which the creditors of the Company’s VIEs have no recourse to the general credit of Astrana, as the primary beneficiary of the VIEs. These assets and liabilities, with the exception of investments in affiliates and amounts due to, or from, affiliates, which are eliminated upon consolidation, are included in the accompanying consolidated balance sheets (in thousands). March 31, December 31, Assets Current assets Cash and cash equivalents $ 212,134 $ 184,078 Investment in marketable securities 50 — Receivables, net 47,169 21,120 Receivables, net – related party 61,870 58,707 Income taxes receivable — 1,600 Other receivables 997 454 Prepaid expenses and other current assets 11,891 9,991 Total current assets 334,111 275,950 Non-current assets Land, property and equipment, net 5,084 5,306 Intangible assets, net 85,058 60,906 Goodwill 236,961 140,157 Income taxes receivable, non-current 15,943 15,943 Investments in other entities – equity method 12,560 12,114 Investment in affiliates* 299,502 273,182 Investment in a privately held entity 405 405 Restricted cash 40 40 Operating lease right-of-use assets 26,082 28,796 Other assets 1,214 1,149 Total non-current assets 682,849 537,998 Total assets $ 1,016,960 $ 813,948 Current liabilities Accounts payable and accrued expenses $ 44,058 $ 32,707 March 31, December 31, Fiduciary accounts payable 7,792 7,737 Medical liabilities 69,611 55,157 Dividend payable 638 638 Income tax payable 8,431 — Finance lease liabilities 602 646 Operating lease liabilities 3,092 3,305 Current portion of long-term debt — 8,542 Amount due to affiliates* 110,117 107,340 Other liabilities 9,387 — Total current liabilities 253,728 216,072 Non-current liabilities Finance lease liabilities, net of current portion 905 1,033 Operating lease liabilities, net of current portion 26,186 28,675 Deferred tax liability 7,166 7,284 Other long-term liabilities 1,690 230 Total non-current liabilities 35,947 37,222 Total liabilities $ 289,675 $ 253,294 *Investment in affiliates includes the Company’s VIEs’ investment in Astrana, which is reflected as treasury shares and eliminated upon consolidation. Amounts due to, or from, affiliates are receivables with Astrana’s subsidiaries. As a result, these balances are eliminated upon consolidation and are not reflected on Astrana’s condensed consolidated balance sheets as of March 31, 2024, and December 31, 2023. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
Leases | Leases The Company has operating and finance leases for corporate offices, physicians’ offices, and certain equipment. These leases have remaining lease terms of four months to seventeen years. Some of the leases may include options to extend the lease terms for up to ten years, and some of the leases may include options to terminate the leases within one year. As of March 31, 2024, and December 31, 2023, assets recorded under finance leases were $1.7 million and $1.7 million, respectively, and accumulated depreciation associated with finance leases was $1.8 million and $1.6 million, respectively. Also, the Company rents or subleases certain real estate to third parties, which are accounted for as operating leases. Leases with an initial term of 12 months or less are not recorded on the balance sheets. The components of lease expense were as follows (dollars in thousands): Three Months Ended March 31, 2024 2023 Operating lease cost $ 3,159 $ 1,751 Finance lease cost Amortization of lease expense 179 154 Interest on lease liabilities 24 22 Sublease income (226) (248) Total lease cost, net $ 3,136 $ 1,679 Other information related to leases was as follows (in thousands): Three Months Ended 2024 2023 Supplemental Cash Flow Information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 2,837 $ 1,742 Operating cash flows from finance leases 24 22 Financing cash flows from finance leases 179 154 Three Months Ended 2024 2023 Weighted Average Remaining Lease Term Operating leases 8.39 years 6.64 years Finance leases 2.96 years 3.22 years Weighted Average Discount Rate Operating leases 6.15 % 5.63 % Finance leases 5.53 % 4.95 % The following are future minimum lease payments under non-cancellable leases for the years ending December 31 (in thousands) below: Operating Leases Finance Leases 2024 (excluding the three months ended March 31, 2024) $ 5,597 $ 560 2025 7,362 599 2026 7,007 345 2027 6,722 265 2028 6,545 27 Thereafter 22,558 7 Total future minimum lease payments 55,791 1,803 Less: imputed interest 13,068 152 Total lease liabilities 42,723 1,651 Less: current portion 5,007 636 Long-term lease liabilities $ 37,716 $ 1,015 |
Leases | Leases The Company has operating and finance leases for corporate offices, physicians’ offices, and certain equipment. These leases have remaining lease terms of four months to seventeen years. Some of the leases may include options to extend the lease terms for up to ten years, and some of the leases may include options to terminate the leases within one year. As of March 31, 2024, and December 31, 2023, assets recorded under finance leases were $1.7 million and $1.7 million, respectively, and accumulated depreciation associated with finance leases was $1.8 million and $1.6 million, respectively. Also, the Company rents or subleases certain real estate to third parties, which are accounted for as operating leases. Leases with an initial term of 12 months or less are not recorded on the balance sheets. The components of lease expense were as follows (dollars in thousands): Three Months Ended March 31, 2024 2023 Operating lease cost $ 3,159 $ 1,751 Finance lease cost Amortization of lease expense 179 154 Interest on lease liabilities 24 22 Sublease income (226) (248) Total lease cost, net $ 3,136 $ 1,679 Other information related to leases was as follows (in thousands): Three Months Ended 2024 2023 Supplemental Cash Flow Information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 2,837 $ 1,742 Operating cash flows from finance leases 24 22 Financing cash flows from finance leases 179 154 Three Months Ended 2024 2023 Weighted Average Remaining Lease Term Operating leases 8.39 years 6.64 years Finance leases 2.96 years 3.22 years Weighted Average Discount Rate Operating leases 6.15 % 5.63 % Finance leases 5.53 % 4.95 % The following are future minimum lease payments under non-cancellable leases for the years ending December 31 (in thousands) below: Operating Leases Finance Leases 2024 (excluding the three months ended March 31, 2024) $ 5,597 $ 560 2025 7,362 599 2026 7,007 345 2027 6,722 265 2028 6,545 27 Thereafter 22,558 7 Total future minimum lease payments 55,791 1,803 Less: imputed interest 13,068 152 Total lease liabilities 42,723 1,651 Less: current portion 5,007 636 Long-term lease liabilities $ 37,716 $ 1,015 |
Segments
Segments | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Segments | Segments The Company evaluates the performance of its operating segments based on segment revenue growth as well as operating income. Management uses revenue growth and total segment operating income as a measure of the performance of operating businesses separate from non-operating factors. The Company’s operations are based in the United States. All revenues of the Company are derived from the United States. The Company’s segments are not evaluated using asset information. In the normal course of business, our reportable segments enter into transactions with each other. While intersegment transactions are treated like third-party transactions to determine segment performance, the revenues recognized by a segment and expenses incurred by the counterparty are eliminated in consolidation and do not affect consolidated results. Corporate costs are unallocated and primarily include corporate initiatives, corporate infrastructure costs and corporate shared costs, such as finance, human resources, legal, and executives. Certain amounts disclosed in prior period have been recast to conform to the current period presentation. Specifically, reclassifications were made between cost of services and general and administrative expenses in the accompanying segment table for the three months ended March 31, 2023. The following table presents information about our segments (in thousands): Three Months Ended March 31, 2024 Care Partners Care Delivery Care Enablement Other Intersegment Elimination Corporate Costs Consolidated Total Third-Party $ 382,318 $ 17,878 $ 4,160 $ — $ — $ — $ 404,356 Intersegment 14,777 12,841 29,114 — (56,732) — — Total revenues 397,095 30,719 33,274 — (56,732) — 404,356 Cost of services 314,966 24,794 17,373 — (26,734) — 330,399 General and administrative (1) 38,933 6,163 12,397 — (30,075) 16,400 43,818 Total expenses 353,899 30,957 29,770 — (56,809) 16,400 374,217 Income (loss) from operations $ 43,196 $ (238) $ 3,504 $ — $ 77 (2) $ (16,400) $ 30,139 Three Months Ended March 31, 2023 Care Partners Care Delivery Care Enablement Other Intersegment Elimination Corporate Costs Consolidated Total Third-Party $ 314,637 $ 12,263 $ 10,139 $ 205 $ — $ — $ 337,244 Intersegment 16 13,120 20,427 35 (33,598) — — Total revenues 314,653 25,383 30,566 240 (33,598) — 337,244 Cost of services 266,323 20,692 15,621 63 (13,302) — 289,397 General and administrative (1) 26,009 5,657 9,199 660 (21,460) 5,409 25,474 Total expenses 292,332 26,349 24,820 723 (34,762) 5,409 314,871 Income (loss) from operations $ 22,321 $ (966) $ 5,746 $ (483) $ 1,164 (2) $ (5,409) $ 22,373 (1) Balance includes general and administrative expenses and depreciation and amortization. (2) |
Fair Value Measurements of Fina
Fair Value Measurements of Financial Instruments | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements of Financial Instruments | Fair Value Measurements of Financial Instruments The carrying amounts and fair values of the Company’s financial instruments as of March 31, 2024, are presented below (in thousands): Fair Value Measurements Level 1 Level 2 Level 3 Total Assets Money market accounts* $ 31,804 $ — $ — $ 31,804 Marketable securities – certificates of deposit 2,258 — — 2,258 Marketable securities – equity securities 232 — — 232 Interest rate collar — 438 — 438 Total assets $ 34,294 $ 438 $ — $ 34,732 Liabilities AAMG contingent consideration $ — $ — $ 7,407 $ 7,407 VOMG contingent consideration — — 17 17 DMG remaining equity interest purchase — — 8,542 8,542 Sun Labs remaining equity interest purchase — — 7,278 7,278 ADSC contingent considerations — — 3,632 3,632 CFC contingent considerations — — 7,767 7,767 PCCCV contingent considerations — — 2,265 2,265 Total liabilities $ — $ — $ 36,908 $ 36,908 * Included in cash and cash equivalents The carrying amounts and fair values of the Company’s financial instruments as of December 31, 2023, are presented below (in thousands): Fair Value Measurements Level 1 Level 2 Level 3 Total Assets Money market accounts* $ 4,842 $ — $ — $ 4,842 Marketable securities – certificates of deposit 2,150 — — 2,150 Marketable securities – equity securities 348 — — 348 Total assets $ 7,340 $ — $ — $ 7,340 Liabilities AAMG contingent consideration $ — $ — $ 5,475 $ 5,475 VOMG contingent consideration — — 17 17 DMG remaining equity interest purchase — — 8,542 8,542 Sun Labs remaining equity interest purchase — — 7,802 7,802 Interest rate collar — 252 — 252 Total liabilities $ — $ 252 $ 21,836 $ 22,088 * Included in cash and cash equivalents The change in the fair value of Level 3 liabilities for the three months ended March 31, 2024, was as follows (in thousands): Amount Balance at January 1, 2024 $ 21,836 Additions 13,161 Change in fair value of existing Level 3 liabilities 1,911 Balance at March 31, 2024 $ 36,908 Investments in Marketable Securities Certificates of deposit are reported at par value, plus accrued interest, with maturity dates greater than ninety days. As of March 31, 2024, and December 31, 2023, certificates of deposit amounted to approximately $2.3 million and $2.2 million, respectively. Investments in certificates of deposit are classified as Level 1 investments in the fair value hierarchy. Equity securities are reported at fair value. These securities are classified as Level 1 in the valuation hierarchy, where quoted market prices from reputable third-party brokers are available in an active market and unadjusted. As of March 31, 2024, and December 31, 2023, the equity securities were approximately $0.2 million and $0.3 million, respectively, in the accompanying condensed consolidated balance sheets. Gains and losses recognized on equity securities sold are recognized in the accompanying condensed consolidated statements of income as other income. The components comprising total gains and losses on equity securities are as follows (in thousands) for the periods listed below: Three Months Ended 2024 2023 Total losses recognized on equity securities $ (116) $ (4,353) Gains recognized on equity securities sold — — Unrealized losses recognized on equity securities held at end of period $ (116) $ (4,353) Derivative Financial Instruments Interest Rate Collar Agreements The Company’s collar agreement is designed to limit the interest rate risk associated with the Company’s Revolver Loan. The principal objective of the collar agreement is to eliminate or reduce the variability of the cash flows in interest payments associated with the Company’s floating-rate debt, thus reducing the impact of interest rate changes on future interest payment cash flows. Refer to Note 9 - “Credit Facility, Bank Loans, and Lines of Credit,” for further information on the Company’s debt. Under the terms of the agreement, the ceiling is 5.0% and the floor is 2.34%. The collar agreement is not designated as a hedging instrument. Changes in the fair value of this contract are recognized as unrealized gain or loss on investments in the accompanying condensed consolidated statements of income and reflected in the accompanying condensed consolidated statements of cash flows as unrealized loss on investments. The estimated fair value of the collar was determined using Level 2. As of March 31, 2024 and December 31, 2023, the fair value of the collar was $0.4 million and $0.3 million, and presented within other assets and other long-term liabilities, respectively, in the accompanying condensed consolidated balance sheets. For the three months ended March 31, 2024, the Company recognized unrealized gains of $0.7 million. Remaining equity interest purchase In 2021, the Company entered into a financing obligation to purchase the remaining equity interest in Diagnostic Medical Group of Southern California (“DMG”) and Sun Clinical Laboratories (“Sun Labs”) within three years from the date the Company consolidated DMG and Sun Labs. The purchase of the remaining DMG equity value is considered a financing obligation with a carrying value of $8.5 million as of March 31, 2024 and December 31, 2023. Changes in the fair value of the remaining equity purchase are presented in unrealized gain and loss on investments in the accompanying condensed consolidated statements of income. The purchase of the remaining Sun Labs equity value is considered a financing obligation with a carrying value of $7.3 million and $7.8 million as of March 31, 2024 and December 31, 2023, respectively. For the three months ended March 31, 2024, and 2023, the Company recognized an unrealized gain of $0.5 million and unrealized loss of $1.4 million, respectively, due to the change in the fair value of Sun Labs equity value obligation. As the financing obligations are embedded in the non-controlling interest, the non-controlling interests are recognized in other liabilities in the accompanying condensed consolidated balance sheets. Contingent considerations All American Medical Group (“ AAMG”) Upon acquiring 100% of the equity interest in AAMG, the purchase price consisted of cash funded upon close of the transaction and additional consideration (“AAMG contingent consideration”) and stock consideration (“AAMG stock contingent consideration”) contingent on AAMG meeting revenue and capitated member metrics for fiscal years 2023 (“2023 metric”) and 2024 (“2024 metric”). If the contingent considerations are met, the settlement will be paid in the Company’s common stock. The total amount of stock that can be issued for the 2023 and 2024 metrics is 157,048 and 184,361, respectively. The Company determined the fair value of the contingent considerations using a probability-weighted model that includes significant unobservable inputs (Level 3). Specifically, the Company considered various scenarios of revenue and assigned probabilities to each such scenario in determining fair value. As of March 31, 2024 and December 31, 2023, the AAMG contingent consideration for the 2023 metric was valued at $3.5 million and $2.6 million, respectively, and was included within other liabilities in the accompanying condensed consolidated balance sheets. The 2023 metric was met, but remains in other liabilities until the shares are issued. The AAMG contingent consideration for the 2024 metric was valued at $3.9 million and $2.9 million as of March 31, 2024 and December 31, 2023, respectively, and was included in other liabilities and other long-term liabilities in the accompanying condensed consolidated balance sheets, respectively. Changes in the AAMG contingent consideration are presented in general and administrative expenses in the accompanying condensed consolidated statements of income. The AAMG stock contingent consideration for 2023 and 2024 metric was valued at $5.6 million as of March 31, 2024 and December 31, 2023 and is included in additional paid-in capital in the accompanying condensed consolidated balance sheets. ADSC Upon acquiring 95% of the equity interest of Advanced Diagnostic and Surgical Center in 2024, the total consideration of the acquisition included contingent considerations. The contingent considerations will be settled in cash contingent on ADSC achieving revenue and EBITDA metrics for fiscal years 2023 (“ADSC 2023 Metric”) and 2024 (“ADSC 2024 Metric”) (collectively, “ADSC contingent considerations”). The Company determined the fair value of the contingent consideration using a probability-weighted model that includes significant unobservable inputs (Level 3). Specifically, the Company considered various scenarios of revenue and assigned probabilities to each such scenario in determining fair value. As of March 31, 2024, the ADSC 2023 Metric and the 2024 Metric were valued at $2.0 million and $1.6 million, respectively and were included in other liabilities in the accompanying condensed consolidated balance sheets. Changes in the ADSC contingent considerations are presented in general and administrative expenses in the accompanying condensed consolidated statements of income. CFC Upon acquiring certain assets of CFC in 2024, the total consideration of the acquisition included contingent considerations. The contingent considerations will be settled in cash contingent upon CFC maintaining or exceeding the target member month amount for the first, second and third measurement period (“CFC contingent considerations”). The contingent liability will be paid after achieving the metric in each measurement period. The Company will pay $5.0 million for each metric achieved for each measurement period or a total of $15.0 million. In the event that the CFC first and/or second contingent considerations are not achieved during the first and/or the second measurement period, if the metric is met within the second and/or third measurement period, there is a catch-up payment that shall be paid concurrently with the payments of the CFC second contingent consideration and/or CFC third contingent consideration. The Company determined the fair value of the contingent consideration using a probability-weighted model that includes significant unobservable inputs (Level 3). Specifically, the Company considered various scenarios of revenue and assigned probabilities to each such scenario in determining fair value. As of March 31, 2024, the first, second, and third metric were valued at $3.1 million, $2.8 million and $1.9 million, respectively, and were all included in other long-term liabilities in the accompanying condensed consolidated balance sheets. Changes in the CFC contingent considerations are presented in general and administrative expenses in the accompanying condensed consolidated statements of income. PCCCV Upon acquiring certain assets of PCCCV in 2024, the total consideration of the acquisition included contingent considerations. The contingent considerations will be settled in cash contingent upon PCCCV meeting certain metrics related to financial ratios and member months for the first and second measurement periods (“PCCCV contingent considerations”). The Company determined the fair value of the contingent considerations using a probability-weighted model that includes significant unobservable inputs (Level 3). Specifically, the Company considered various scenarios of revenue and assigned probabilities to each such scenario in determining fair value. As of March 31, 2024, the value of the contingent consideration was valued at $2.3 million. Changes in the PCCCV contingent considerations are presented in general and administrative expenses in the accompanying condensed consolidated statements of income. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2024 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events I Health Promissory Note Payable On April 1, 2024, the Company received $8.3 million as a promissory note with a maturity date of March 31, 2027. I Health may accelerate the maturity date if the Company does not exercise the call options (see Note 5 — “Investments in Other Entities - Equity Method”) The promissory note has an interest rate of 4.30% per annum on the principal amount. Accrued interest is payable on each anniversary of the promissory note payable. I Health is accounted for under the equity method based on the 25% equity ownership interest held by the Company (see Note 5 — “Investments in Other Entities - Equity Method”). Elimination of Series A Convertible Preferred Stock and Series B Convertible Preferred Stock On April 24, 2024, the Company filed a Certificate of Elimination to its Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, eliminating from the Certificate of Incorporation all matters set forth in the Amended and Restated Certificate of Designation with respect to the Company’s Series A Convertible Preferred Stock and Series B Convertible Preferred Stock and returning each of the Series A Preferred Stock and Series B Preferred Stock to the status of authorized and unissued shares of preferred stock of the Company, without designation as to series. There were no outstanding shares of the Series A Preferred Stock or Series B Preferred Stock as of April 24, 2024. Drawdown on Revolver Loan Subsequent to March 31, 2024, the Company drew down $52.0 million on its Revolver Loan. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) | $ 14,835 | $ 13,132 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation |
Principles of Consolidation | Principles of Consolidation The condensed consolidated balance sheets as of March 31, 2024 and December 31, 2023, and the condensed consolidated statements of income for the three months ended March 31, 2024 and 2023, include Astrana’s wholly owned subsidiaries and consolidated variable interest entities (“VIEs”). The unaudited condensed consolidated interim financial statements have been prepared under the assumption that users of the interim financial data have either read or have access to our audited condensed consolidated financial statements for the fiscal year ended December 31, 2023. |
Use of Estimates | Use of Estimates The preparation of the condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include collectability of receivables, recoverability of long-lived and intangible assets, business combination and goodwill valuation and impairment, accrual of medical liabilities (incurred but not reported (“IBNR”) claims), determination of hospital shared-risk and health plan shared-risk revenue and receivables (including constraints, completion factors and historical margins), income tax-valuation allowance, share-based compensation, and right-of-use assets and lease liabilities. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ materially from those estimates and assumptions. |
Business Combinations | Business Combinations The Company uses the acquisition method of accounting for all business combinations, which requires assets and liabilities of the acquiree to be recorded at fair value, to measure the fair value of the consideration transferred, including contingent consideration, to be determined on the acquisition date, and to account for acquisition-related costs separately from the business combination. |
Reportable Segments | Reportable Segments As of March 31, 2024, the Company operates in three reportable segments: • Care Partners; • Care Delivery; and • Care Enablement. Refer to Note 1 — “Description of Business” and Note 18 — “Segments” to the condensed consolidated financial statements for information on the Company’s segments. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company’s cash and cash equivalents primarily consist of money market funds and certificates of deposit. The Company considers all highly liquid investments that are both readily convertible into known amounts of cash and mature within ninety days from their date of purchase to be cash equivalents. |
Receivables, Receivables – Related Parties, Other Receivables and Loan Receivables | Receivables, Receivables – Related Parties, Other Receivables and Loan Receivables The Company’s receivables are comprised of accounts receivable, capitation and claims receivable, risk pool settlements, incentive receivables, management fee income, and other receivables. Accounts receivable are recorded and stated at the amount expected to be collected. The Company’s receivables – related parties are comprised of risk pool settlements, management fee income, and other receivables. Receivables – related parties are recorded and stated at the amount expected to be collected. The Company’s loan receivables consists of promissory notes that accrue interest per annum. As of March 31, 2024, promissory notes are expected to be collected by their maturity dates. Capitation and claims receivables relate to each health plan’s capitation and are received by the Company in the month following the month of service. Risk pool settlements and incentive receivables mainly consist of the Company’s hospital shared-risk pool receivable, which is recorded quarterly based on reports received from the Company’s hospital partners and management’s estimate of the Company’s portion of the estimated risk pool surplus for open performance years. Settlement of risk pool surplus or deficits occurs approximately 18 months after the risk pool performance year is completed. Other receivables consist of receivables from fee-for-service (“FFS”) reimbursement for patient care, certain expense reimbursements, transportation reimbursements from the hospitals, and stop-loss insurance premium reimbursements. The Company maintains reserves for potential credit losses on the receivables. Management reviews the composition of the Company’s receivables and analyzes historical bad debts, customer concentrations, customer creditworthiness, current economic trends, and changes in customer payment patterns to evaluate the adequacy of these reserves. The Company also regularly analyzes the ultimate collectability of accounts receivable after certain stages of the collection cycle using a look-back analysis to determine the amount of receivables subsequently collected and adjustments are recorded when necessary. Reserves are recorded primarily on a specific identification basis. |
Concentrations of Credit Risks | Concentrations of Credit Risks |
Revenue Recognition | Revenue Recognition The Company receives payments from the following sources for services rendered: • Commercial insurers; • Federal government under the Medicare program administered by CMS; • State governments under Medicaid and other programs; • Other third-party payers (e.g., hospitals and IPAs); and • Individual patients and clients. Revenue primarily consists of the following: • Capitation revenue; • Risk pool settlements and incentives; • Management fee revenue; and • FFS revenue. Revenue is recorded in the period in which services are rendered or the period in which the Company is obligated to provide services. The form of billing and related risk of collection for such services may vary by type of revenue and the customer. Risk Pool Settlements and Incentives Medicare Shared Savings Program Revenue Beginning in 2024, Astrana participates in MSSP. The MSSP has multiple risk tracks, and Astrana is currently participating in the ENHANCED risk track. Under the MSSP Model, Astrana recruits a group of Participant and Preferred (in-network) Providers. Based on the Participant Providers that join our ACO, CMS grants us a pool of Traditional Medicare patients (beneficiaries) to manage (the “MSSP Aligned Beneficiaries”). The Company’s MSSP Aligned Beneficiaries will receive services from physicians and other medical service providers that are both in-network and out-of-network. CMS continues to pay participant and preferred providers on a fee-for-service basis for Medicare-covered services provided to MSSP Aligned Beneficiaries. The Company continues to bear risk on all Medicare expenditures (both in-network and out-of-network), excluding drug expenditures covered by Medicare Part D, based on a budgetary benchmark established with CMS. Astrana’s shared savings or losses in managing the Company’s beneficiaries are generally determined on an annual basis after reconciliation with CMS. Pursuant to Astrana’s risk-share agreement with CMS, the Company is eligible to receive the surplus (“shared savings”) or is liable for the deficit (“shared losses”) according to the budgetary benchmark established by CMS based on Astrana’s efficiency, or lack thereof, in managing the expenditures associated with the Company’s MSSP Aligned Beneficiaries. The Company estimates the shared service revenue by analyzing the activities during the relevant time period in contemplation of the agreed upon benchmarks, metrics, performance criteria, and attribution criteria based on those and any other contractually defined factors. Revenue is not recorded and is constrained until the shared service revenue can be reasonably estimated by the Company and to the extent that it is probable that a significant reversal will not occur once any uncertainty associated with the variable consideration is subsequently resolved. |
Income Taxes | Income Taxes Federal and state income taxes are computed at currently enacted tax rates less tax credits using the asset and liability method. Deferred taxes are adjusted for both items that do not have tax consequences and for the cumulative effect of any changes in tax rates from those previously used to determine deferred tax assets or liabilities. Tax provisions include amounts that are currently payable, changes in deferred tax assets and liabilities that arise because of temporary differences between the timing of when items of income and expense are recognized for financial reporting and income tax purposes, changes in recognition of tax positions and any changes in the valuation allowance caused by a change in judgment about the realizability of the related deferred tax assets. A valuation allowance is established when necessary to reduce deferred tax assets to amounts expected to be realized. The Company uses a recognition threshold of more-likely-than-not and a measurement attribute on all tax positions taken or expected to be taken in a tax return in order to be recognized in the condensed consolidated financial statements. Once the recognition threshold is met, the tax position is then measured to determine the actual amount of benefit to recognize in the condensed consolidated financial statements. |
Recent Accounting Pronouncements Not Yet Adopted | Recent Accounting Pronouncements Not Yet Adopted In November 2023, the Financial Standards Accounting Board (FASB) issued Accounting Standards Update (ASU) 2023-07 "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for the Company’s annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures. In December 2023, the FASB issued ASU 2023-09 "Income Taxes (Topics 740): Improvements to Income Tax Disclosures" to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for the Company’s annual periods beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures. |
Derivative Financial Instruments | Derivative Financial Instruments Interest Rate Collar Agreements The Company’s collar agreement is designed to limit the interest rate risk associated with the Company’s Revolver Loan. The principal objective of the collar agreement is to eliminate or reduce the variability of the cash flows in interest payments associated with the Company’s floating-rate debt, thus reducing the impact of interest rate changes on future interest payment cash flows. Refer to Note 9 - “Credit Facility, Bank Loans, and Lines of Credit,” for further information on the Company’s debt. Under the terms of the agreement, the ceiling is 5.0% and the floor is 2.34%. The collar agreement is not designated as a hedging instrument. Changes in the fair value of this contract are recognized as unrealized gain or loss on investments in the accompanying condensed consolidated statements of income and reflected in the accompanying condensed consolidated statements of cash flows as unrealized loss on investments. The estimated fair value of the collar was determined using Level 2. As of March 31, 2024 and December 31, 2023, the fair value of the collar was $0.4 million and $0.3 million, and presented within other assets and other long-term liabilities, respectively, in the accompanying condensed consolidated balance sheets. For the three months ended March 31, 2024, the Company recognized unrealized gains of $0.7 million. |
Investments in Marketable Securities | Investments in Marketable Securities Certificates of deposit are reported at par value, plus accrued interest, with maturity dates greater than ninety days. As of March 31, 2024, and December 31, 2023, certificates of deposit amounted to approximately $2.3 million and $2.2 million, respectively. Investments in certificates of deposit are classified as Level 1 investments in the fair value hierarchy. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Schedule of Disaggregated Revenue by Each Payor Type | The following table presents disaggregated revenue generated by payer type for the three months ended March 31, 2024 and 2023 (in thousands): Three Months Ended 2024 2023 Commercial $ 49,512 $ 40,019 Medicare 246,564 216,310 Medicaid 81,263 67,339 Other third parties 27,017 13,576 Revenue $ 404,356 $ 337,244 |
Schedule of Contributions to Revenue and Receivables by Payor | The Company had major payers that contributed the following percentages of net revenue: Three Months Ended 2024 2023 Payer A 34.0 % 41.5 % Payer B 13.5 % * *Less than 10% of total net revenues The Company had major payers that contributed to the following percentages of receivables and receivables – related parties: As of March 31, As of December 31, Payer A 31.0 % 36.0 % Payer C 33.0 % 41.0 % |
Business Combinations, Asset _2
Business Combinations, Asset Acquisitions, and Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The following table summarizes the preliminary purchase price allocation of the fair value of assets acquired and liabilities assumed related to each acquisition at the acquisition date (in thousands): CFC AHMS Others * Net Total Total purchase consideration: Cash paid $ 90,998 $ — $ 12,500 $ 103,498 Cash payable — 63,935 — 63,935 Contingent consideration 7,264 — 5,897 13,161 Common stock issued 21,952 — — 21,952 $ 120,214 $ 63,935 $ 18,397 $ 202,546 Assets: Cash and cash equivalents $ 16,674 $ 33,950 $ 3,515 $ 54,139 Investment in marketable securities 50 — 30 80 Receivables 5,351 11,847 — 17,198 Prepaid expenses and other current assets — 36 11 47 Amounts due from affiliates 3,909 — — 3,909 Land, property and equipment — — 823 823 Intangible assets 26,000 23,800 2,703 52,503 Goodwill 90,148 29,876 12,318 132,342 Restricted cash — 300 — 300 Total identifiable assets acquired $ 142,132 $ 99,809 $ 19,400 $ 261,341 Liabilities: Accounts payable and accrued expenses $ 4,376 $ 7,232 $ 250 $ 11,858 Medical liabilities 17,508 13,137 — 30,645 Amounts due to affiliates — 7,241 54 7,295 Income taxes payable 34 1,604 — 1,638 Deferred tax liability — 6,660 271 6,931 Noncontrolling interest — — 428 428 Total identified liabilities assumed $ 21,918 $ 35,874 $ 1,003 $ 58,795 Total net identifiable assets acquired $ 120,214 $ 63,935 $ 18,397 $ 202,546 * Others consist of estimated fair values of the assets acquired, net of cash acquired, related to ADSC and PCCCV. Unaudited Pro Forma Financial Information The pro forma financial information in the table below presents the combined results of the Company and CFC, AHMS, ADSC and PCCCV as if the acquisitions had occurred on January 1, 2023. The pro forma information presented is shown for illustrative purposes only and is not necessarily indicative of future results of operations of the Company or results of operations of the Company that would have actually occurred had the transactions been in effect for the periods presented. Three Months Ended (in thousands, except per share amounts) 2024 2023 Total revenue $ 493,006 $ 382,462 Net income $ 16,661 $ 20,324 Net income per share - basic $ 0.35 $ 0.44 Net income per share - diluted $ 0.35 $ 0.43 |
Schedule of Change in Carrying Value of Goodwill | The change in the carrying value of goodwill for the three months ended March 31, 2024 was as follows (in thousands): Amount Balance, January 1, 2024 $ 278,831 Acquisitions 132,342 Adjustments (906) Balance, March 31, 2024 $ 410,267 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets, Net | At March 31, 2024, the Company’s intangible assets, net, consisted of the following (in thousands): Useful Life (Years) Gross March 31, Accumulated Net March 31, Indefinite lived assets: Trademarks N/A $ 2,150 $ — $ 2,150 Licenses N/A 1,900 — 1,900 Amortized intangible assets: Network relationships 11-21 155,978 (107,137) 48,841 Management contracts 15 22,832 (17,002) 5,830 Member relationships 7-14 69,381 (9,154) 60,227 Patient management platform 5 2,060 (2,060) — Tradename/trademarks 20 1,011 (320) 691 Developed technology 6 107 (39) 68 $ 255,419 $ (135,712) $ 119,707 At December 31, 2023, the Company’s intangible assets, net, consisted of the following (in thousands): Useful Life (Years) Gross December 31, Accumulated Net December 31, 2023 Indefinite lived assets: Trademarks N/A $ 2,150 $ — $ 2,150 Amortized intangible assets: Network relationships 11-21 150,679 (104,859) 45,820 Management contracts 15 22,832 (16,662) 6,170 Member relationships 10-14 24,077 (7,345) 16,732 Patient management platform 5 2,060 (2,060) — Tradename/trademarks 20 1,011 (308) 703 Developed technology 6 107 (34) 73 $ 202,916 $ (131,268) $ 71,648 |
Schedule of Future Amortization Expense | Future amortization expense is estimated to be as follows for the following years ending December 31 (in thousands): Amount 2024 (excluding the three months ended March 31, 2024) $ 20,144 2025 22,373 2026 18,178 2027 14,746 2028 12,085 Thereafter 28,131 Total $ 115,657 |
Investments in Other Entities (
Investments in Other Entities (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Method Investments | For the three months ended March 31, 2024 and 2023, the Company’s equity method investment balance consisted of the following (in thousands): % of Ownership December 31, Initial Investment Allocation of Net Income Distribution March 31, 2024 LaSalle Medical Associates – IPA line of business 25% $ 9,866 $ — $ 359 $ — $ 10,225 Pacific Medical Imaging & Oncology Center, Inc. 40% 1,691 — 27 — 1,718 CAIPA MSO, LLC 30% 13,660 — 186 — 13,846 I Health, Inc. 25% — 9,487 — — 9,487 Other * 25% 557 — 60 — 617 $ 25,774 $ 9,487 $ 632 $ — $ 35,893 % of Ownership December 31, Initial Investment Allocation of Net Income (Loss) Distribution March 31, 2023 LaSalle Medical Associates – IPA line of business 25% $ 5,684 $ — $ 2,165 $ — $ 7,849 Pacific Medical Imaging & Oncology Center, Inc. 40% 1,878 — 8 — 1,886 531 W. College, LLC ** 50% 17,281 — (90) — 17,191 One MSO, LLC ** 50% 2,718 — 115 — 2,833 CAIPA MSO, LLC 30% 12,738 — 249 — 12,987 Other * 25% — 325 37 — 362 $ 40,299 $ 325 $ 2,484 $ — $ 43,108 * Other consists of smaller equity method investments. |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Expenses | The Company’s accounts payable and accrued expenses consisted of the following (in thousands): March 31, December 31, Accounts payable and other accruals $ 84,867 $ 9,075 Capitation payable 10,225 4,503 Subcontractor IPA payable 2,529 2,529 Professional fees 5,293 4,407 Due to related parties 11,679 9,271 Contract liabilities 3,017 744 Accrued compensation 12,410 20,098 Other provider payable 16,453 9,322 Total accounts payable and accrued expenses $ 146,473 $ 59,949 |
Medical Liabilities (Tables)
Medical Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Liability for Unpaid Claims and Claims Adjustment Expense, Activity in Liability [Abstract] | |
Schedule of Medical Liabilities | The Company’s medical liabilities consisted of the following (in thousands): March 31, March 31, Medical liabilities, beginning of period $ 106,657 $ 81,255 Acquired (see Note 3) 30,645 — Components of medical care costs related to claims incurred: Current period 235,237 223,713 Prior periods (1,419) (8,950) Total medical care costs 233,818 214,763 Payments for medical care costs related to claims incurred: Current period (136,286) (136,743) Prior periods (97,837) (61,736) Total paid (234,123) (198,479) Adjustments (503) 857 Medical liabilities, end of period $ 136,494 $ 98,396 |
Credit Facility, Bank Loans, _2
Credit Facility, Bank Loans, and Lines of Credit (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Credit Facility | The Company’s debt balance consisted of the following (in thousands): March 31, 2024 December 31, 2023 Term Loan $ 296,500 $ 280,000 Revolver Loan 94,759 — Promissory Note Payable 2,000 2,000 Total debt 393,259 282,000 Less: Current portion of debt (20,750) (19,500) Less: Unamortized financing costs (4,061) (3,561) Long-term debt $ 368,448 $ 258,939 |
Schedule of Future Commitments of Credit Facility | The following are the future commitments of the Company’s debt for the years ending December 31 (in thousands): Amount 2024 (excluding the three months ended March 31, 2024) $ 17,000 2025 16,875 2026 117,259 2027 24,375 2028 217,750 Total $ 393,259 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Share-Based Compensation Expense | The following table summarizes the stock-based compensation expense recognized under all of the Company’s stock plans for the three months ended March 31, 2024 and 2023, and associated with the issuance of restricted shares of common stock and vesting of stock options that are included in general and administrative expenses in the accompanying condensed consolidated statements of income (in thousands): Three Months Ended 2024 2023 Stock options $ 349 $ 566 Restricted stock 5,399 2,879 Total stock-based compensation expense $ 5,748 $ 3,445 |
Schedule of Stock Option Transactions Under Stock Option Plans | The Company’s outstanding stock options consisted of the following: Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Aggregate Options outstanding at January 1, 2024 504,241 $ 34.03 2.1 $ 4.7 Options granted — — — — Options exercised — — — — Options forfeited (7,271) 50.56 — — Options outstanding at March 31, 2024 496,970 $ 33.79 1.61 $ 8.4 Options exercisable at March 31, 2024 459,140 $ 28.04 1.41 $ 8.4 |
Related-Party Transactions (Tab
Related-Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
Schedule of Fees Incurred and Revenue Earned from Related Party Transactions | The following table sets forth revenue recognized and fees incurred related to AHMC, HSMSO, and Aurion for the three months ended March 31, 2024 and 2023 (in thousands): Three months ended March 31, 2024 Three months ended March 31, 2023 AHMC HSMSO Aurion AHMC HSMSO Aurion Revenue $ 9,920 $ 301 $ — $ 14,484 $ 315 $ — Expenses 7,557 — 50 6,400 169 50 Net $ 2,363 $ 301 $ (50) $ 8,084 $ 146 $ (50) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share Computations | Below is a summary of the earnings per share computations: Three Months Ended March 31, 2024 2023 Earnings per share – basic $ 0.31 $ 0.28 Earnings per share – diluted $ 0.31 $ 0.28 Weighted average shares of common stock outstanding – basic 47,260,351 46,555,406 Weighted average shares of common stock outstanding – diluted 47,699,537 46,954,687 |
Schedule of Shares Included in the Diluted Earnings Per Share Computations | Below is a summary of the shares included in the diluted earnings per share computations: Three Months Ended March 31, 2024 2023 Weighted average shares of common stock outstanding – basic 47,260,351 46,555,406 Stock options 188,083 306,933 Restricted stock 225,128 48,191 Contingently issuable shares 25,975 44,157 Weighted average shares of common stock outstanding – diluted 47,699,537 46,954,687 |
Variable Interest Entities (V_2
Variable Interest Entities (VIEs) (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Assets and Liabilities, Variable Interest Entities | The following table includes assets that can only be used to settle the liabilities of the Company’s VIEs, and to which the creditors of Astrana have no recourse, and liabilities to which the creditors of the Company’s VIEs have no recourse to the general credit of Astrana, as the primary beneficiary of the VIEs. These assets and liabilities, with the exception of investments in affiliates and amounts due to, or from, affiliates, which are eliminated upon consolidation, are included in the accompanying consolidated balance sheets (in thousands). March 31, December 31, Assets Current assets Cash and cash equivalents $ 212,134 $ 184,078 Investment in marketable securities 50 — Receivables, net 47,169 21,120 Receivables, net – related party 61,870 58,707 Income taxes receivable — 1,600 Other receivables 997 454 Prepaid expenses and other current assets 11,891 9,991 Total current assets 334,111 275,950 Non-current assets Land, property and equipment, net 5,084 5,306 Intangible assets, net 85,058 60,906 Goodwill 236,961 140,157 Income taxes receivable, non-current 15,943 15,943 Investments in other entities – equity method 12,560 12,114 Investment in affiliates* 299,502 273,182 Investment in a privately held entity 405 405 Restricted cash 40 40 Operating lease right-of-use assets 26,082 28,796 Other assets 1,214 1,149 Total non-current assets 682,849 537,998 Total assets $ 1,016,960 $ 813,948 Current liabilities Accounts payable and accrued expenses $ 44,058 $ 32,707 March 31, December 31, Fiduciary accounts payable 7,792 7,737 Medical liabilities 69,611 55,157 Dividend payable 638 638 Income tax payable 8,431 — Finance lease liabilities 602 646 Operating lease liabilities 3,092 3,305 Current portion of long-term debt — 8,542 Amount due to affiliates* 110,117 107,340 Other liabilities 9,387 — Total current liabilities 253,728 216,072 Non-current liabilities Finance lease liabilities, net of current portion 905 1,033 Operating lease liabilities, net of current portion 26,186 28,675 Deferred tax liability 7,166 7,284 Other long-term liabilities 1,690 230 Total non-current liabilities 35,947 37,222 Total liabilities $ 289,675 $ 253,294 *Investment in affiliates includes the Company’s VIEs’ investment in Astrana, which is reflected as treasury shares and eliminated upon consolidation. Amounts due to, or from, affiliates are receivables with Astrana’s subsidiaries. As a result, these balances are eliminated upon consolidation and are not reflected on Astrana’s condensed consolidated balance sheets as of March 31, 2024, and December 31, 2023. |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
Schedule of Information Related to Lease Costs | The components of lease expense were as follows (dollars in thousands): Three Months Ended March 31, 2024 2023 Operating lease cost $ 3,159 $ 1,751 Finance lease cost Amortization of lease expense 179 154 Interest on lease liabilities 24 22 Sublease income (226) (248) Total lease cost, net $ 3,136 $ 1,679 Other information related to leases was as follows (in thousands): Three Months Ended 2024 2023 Supplemental Cash Flow Information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 2,837 $ 1,742 Operating cash flows from finance leases 24 22 Financing cash flows from finance leases 179 154 Three Months Ended 2024 2023 Weighted Average Remaining Lease Term Operating leases 8.39 years 6.64 years Finance leases 2.96 years 3.22 years Weighted Average Discount Rate Operating leases 6.15 % 5.63 % Finance leases 5.53 % 4.95 % |
Schedule of Future Minimum Operating Lease Payments Under Non-cancelable Leases | The following are future minimum lease payments under non-cancellable leases for the years ending December 31 (in thousands) below: Operating Leases Finance Leases 2024 (excluding the three months ended March 31, 2024) $ 5,597 $ 560 2025 7,362 599 2026 7,007 345 2027 6,722 265 2028 6,545 27 Thereafter 22,558 7 Total future minimum lease payments 55,791 1,803 Less: imputed interest 13,068 152 Total lease liabilities 42,723 1,651 Less: current portion 5,007 636 Long-term lease liabilities $ 37,716 $ 1,015 |
Schedule of Future Minimum Finance Lease Payments Under Non-cancelable Leases | The following are future minimum lease payments under non-cancellable leases for the years ending December 31 (in thousands) below: Operating Leases Finance Leases 2024 (excluding the three months ended March 31, 2024) $ 5,597 $ 560 2025 7,362 599 2026 7,007 345 2027 6,722 265 2028 6,545 27 Thereafter 22,558 7 Total future minimum lease payments 55,791 1,803 Less: imputed interest 13,068 152 Total lease liabilities 42,723 1,651 Less: current portion 5,007 636 Long-term lease liabilities $ 37,716 $ 1,015 |
Segments (Tables)
Segments (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Schedule of Information about our Segments | Certain amounts disclosed in prior period have been recast to conform to the current period presentation. Specifically, reclassifications were made between cost of services and general and administrative expenses in the accompanying segment table for the three months ended March 31, 2023. The following table presents information about our segments (in thousands): Three Months Ended March 31, 2024 Care Partners Care Delivery Care Enablement Other Intersegment Elimination Corporate Costs Consolidated Total Third-Party $ 382,318 $ 17,878 $ 4,160 $ — $ — $ — $ 404,356 Intersegment 14,777 12,841 29,114 — (56,732) — — Total revenues 397,095 30,719 33,274 — (56,732) — 404,356 Cost of services 314,966 24,794 17,373 — (26,734) — 330,399 General and administrative (1) 38,933 6,163 12,397 — (30,075) 16,400 43,818 Total expenses 353,899 30,957 29,770 — (56,809) 16,400 374,217 Income (loss) from operations $ 43,196 $ (238) $ 3,504 $ — $ 77 (2) $ (16,400) $ 30,139 Three Months Ended March 31, 2023 Care Partners Care Delivery Care Enablement Other Intersegment Elimination Corporate Costs Consolidated Total Third-Party $ 314,637 $ 12,263 $ 10,139 $ 205 $ — $ — $ 337,244 Intersegment 16 13,120 20,427 35 (33,598) — — Total revenues 314,653 25,383 30,566 240 (33,598) — 337,244 Cost of services 266,323 20,692 15,621 63 (13,302) — 289,397 General and administrative (1) 26,009 5,657 9,199 660 (21,460) 5,409 25,474 Total expenses 292,332 26,349 24,820 723 (34,762) 5,409 314,871 Income (loss) from operations $ 22,321 $ (966) $ 5,746 $ (483) $ 1,164 (2) $ (5,409) $ 22,373 (1) Balance includes general and administrative expenses and depreciation and amortization. (2) |
Fair Value Measurements of Fi_2
Fair Value Measurements of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Amounts and Fair Values of Financial Instruments | The carrying amounts and fair values of the Company’s financial instruments as of March 31, 2024, are presented below (in thousands): Fair Value Measurements Level 1 Level 2 Level 3 Total Assets Money market accounts* $ 31,804 $ — $ — $ 31,804 Marketable securities – certificates of deposit 2,258 — — 2,258 Marketable securities – equity securities 232 — — 232 Interest rate collar — 438 — 438 Total assets $ 34,294 $ 438 $ — $ 34,732 Liabilities AAMG contingent consideration $ — $ — $ 7,407 $ 7,407 VOMG contingent consideration — — 17 17 DMG remaining equity interest purchase — — 8,542 8,542 Sun Labs remaining equity interest purchase — — 7,278 7,278 ADSC contingent considerations — — 3,632 3,632 CFC contingent considerations — — 7,767 7,767 PCCCV contingent considerations — — 2,265 2,265 Total liabilities $ — $ — $ 36,908 $ 36,908 * Included in cash and cash equivalents The carrying amounts and fair values of the Company’s financial instruments as of December 31, 2023, are presented below (in thousands): Fair Value Measurements Level 1 Level 2 Level 3 Total Assets Money market accounts* $ 4,842 $ — $ — $ 4,842 Marketable securities – certificates of deposit 2,150 — — 2,150 Marketable securities – equity securities 348 — — 348 Total assets $ 7,340 $ — $ — $ 7,340 Liabilities AAMG contingent consideration $ — $ — $ 5,475 $ 5,475 VOMG contingent consideration — — 17 17 DMG remaining equity interest purchase — — 8,542 8,542 Sun Labs remaining equity interest purchase — — 7,802 7,802 Interest rate collar — 252 — 252 Total liabilities $ — $ 252 $ 21,836 $ 22,088 * Included in cash and cash equivalents |
Schedule of Change in Fair Value of Level 3 Liabilities | The change in the fair value of Level 3 liabilities for the three months ended March 31, 2024, was as follows (in thousands): Amount Balance at January 1, 2024 $ 21,836 Additions 13,161 Change in fair value of existing Level 3 liabilities 1,911 Balance at March 31, 2024 $ 36,908 |
Schedule of Gain (Loss) on Equity Securities | The components comprising total gains and losses on equity securities are as follows (in thousands) for the periods listed below: Three Months Ended 2024 2023 Total losses recognized on equity securities $ (116) $ (4,353) Gains recognized on equity securities sold — — Unrealized losses recognized on equity securities held at end of period $ (116) $ (4,353) |
Description of Business (Detail
Description of Business (Details) | 3 Months Ended |
Mar. 31, 2024 segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 3 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 USD ($) segment | Dec. 31, 2023 USD ($) | |
Accounting Policies [Abstract] | ||
Number of reportable segments | segment | 3 | |
Amount deposit accounts exceeded FDIC insured limit | $ | $ 353.6 | $ 318.9 |
Risk pool surplus or deficits, settlement period after risk pool performance year | 18 months |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Disaggregated Revenue by Each Payer Type (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 404,356 | $ 337,244 |
Commercial | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 49,512 | 40,019 |
Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 246,564 | 216,310 |
Medicaid | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 81,263 | 67,339 |
Other third parties | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 27,017 | $ 13,576 |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Contributions to Revenue and Receivables by Payer (Details) - Customer Concentration Risk | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Net Revenue | Payer A | |||
Accounts Receivable And Net Revenue [Line Items] | |||
Concentration risk | 34% | 41.50% | |
Net Revenue | Payer B | |||
Accounts Receivable And Net Revenue [Line Items] | |||
Concentration risk | 13.50% | ||
Receivables and Receivables-Related Parties | Payer A | |||
Accounts Receivable And Net Revenue [Line Items] | |||
Concentration risk | 31% | 36% | |
Receivables and Receivables-Related Parties | Payer C | |||
Accounts Receivable And Net Revenue [Line Items] | |||
Concentration risk | 33% | 41% |
Business Combinations, Asset _3
Business Combinations, Asset Acquisitions, and Goodwill - Additional Information (Details) - USD ($) | 3 Months Ended | |||||
Mar. 31, 2024 | Mar. 29, 2024 | Jan. 31, 2024 | Mar. 31, 2024 | Mar. 31, 2023 | Jan. 01, 2024 | |
Business Acquisition [Line Items] | ||||||
Impairment of goodwill | $ 0 | $ 0 | ||||
Revenue since acquisition | 33,200,000 | |||||
Net income since acquisition | $ 5,100,000 | |||||
AHMS | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 63,935,000 | |||||
Prime Community Care of Central Valley, Inc | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 10,300,000 | |||||
Contingent consideration | $ 2,300,000 | |||||
Community Family Care Medical Group IPA, Inc. | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 120,214,000 | |||||
Contingent consideration | 7,300,000 | |||||
Consideration of acquisition in cash funded | 91,000,000 | |||||
Business acquisition of common stock | $ 22,000,000 | |||||
Equity interest issued, number of shares (shares) | 631,712 | |||||
Advanced Diagnostic and Surgical Center, Inc | ||||||
Business Acquisition [Line Items] | ||||||
Interest acquired | 95% | |||||
Value of the contingent consideration | $ 3,600,000 |
Business Combinations, Asset _4
Business Combinations, Asset Acquisitions, and Goodwill - Summary of Purchase Price Allocation (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2024 | Jan. 31, 2024 | Mar. 31, 2024 | Dec. 31, 2023 | |
Assets: | ||||
Goodwill | $ 410,267 | $ 410,267 | $ 278,831 | |
CFC | ||||
Total purchase consideration: | ||||
Cash paid | $ 90,998 | |||
Cash payable | 0 | |||
Contingent consideration | 7,264 | |||
Common stock issued | 21,952 | |||
Consideration transferred | 120,214 | |||
Assets: | ||||
Cash and cash equivalents | 16,674 | |||
Investment in marketable securities | 50 | |||
Receivables | 5,351 | |||
Prepaid expenses and other current assets | 0 | |||
Amounts due from affiliates | 3,909 | |||
Land, property and equipment | 0 | |||
Intangible assets | 26,000 | |||
Goodwill | 90,148 | |||
Restricted cash | 0 | |||
Total identifiable assets acquired | 142,132 | |||
Liabilities: | ||||
Accounts payable and accrued expenses | 4,376 | |||
Medical liabilities | 17,508 | |||
Amounts due to affiliates | 0 | |||
Income taxes payable | 34 | |||
Deferred tax liability | 0 | |||
Noncontrolling interest | 0 | |||
Total identified liabilities assumed | 21,918 | |||
Total net identifiable assets acquired | $ 120,214 | |||
AHMS | ||||
Total purchase consideration: | ||||
Cash paid | 0 | |||
Cash payable | 63,935 | |||
Contingent consideration | 0 | |||
Common stock issued | 0 | |||
Consideration transferred | 63,935 | |||
Assets: | ||||
Cash and cash equivalents | 33,950 | 33,950 | ||
Investment in marketable securities | 0 | 0 | ||
Receivables | 11,847 | 11,847 | ||
Prepaid expenses and other current assets | 36 | 36 | ||
Amounts due from affiliates | 0 | 0 | ||
Land, property and equipment | 0 | 0 | ||
Intangible assets | 23,800 | 23,800 | ||
Goodwill | 29,876 | 29,876 | ||
Restricted cash | 300 | 300 | ||
Total identifiable assets acquired | 99,809 | 99,809 | ||
Liabilities: | ||||
Accounts payable and accrued expenses | 7,232 | 7,232 | ||
Medical liabilities | 13,137 | 13,137 | ||
Amounts due to affiliates | 7,241 | 7,241 | ||
Income taxes payable | 1,604 | 1,604 | ||
Deferred tax liability | 6,660 | 6,660 | ||
Noncontrolling interest | 0 | 0 | ||
Total identified liabilities assumed | 35,874 | 35,874 | ||
Total net identifiable assets acquired | 63,935 | 63,935 | ||
Other Acquisitions | ||||
Total purchase consideration: | ||||
Cash paid | 12,500 | |||
Cash payable | 0 | |||
Contingent consideration | 5,897 | |||
Common stock issued | 0 | |||
Consideration transferred | 18,397 | |||
Assets: | ||||
Cash and cash equivalents | 3,515 | 3,515 | ||
Investment in marketable securities | 30 | 30 | ||
Receivables | 0 | 0 | ||
Prepaid expenses and other current assets | 11 | 11 | ||
Amounts due from affiliates | 0 | 0 | ||
Land, property and equipment | 823 | 823 | ||
Intangible assets | 2,703 | 2,703 | ||
Goodwill | 12,318 | 12,318 | ||
Restricted cash | 0 | 0 | ||
Total identifiable assets acquired | 19,400 | 19,400 | ||
Liabilities: | ||||
Accounts payable and accrued expenses | 250 | 250 | ||
Medical liabilities | 0 | 0 | ||
Amounts due to affiliates | 54 | 54 | ||
Income taxes payable | 0 | 0 | ||
Deferred tax liability | 271 | 271 | ||
Noncontrolling interest | 428 | 428 | ||
Total identified liabilities assumed | 1,003 | 1,003 | ||
Total net identifiable assets acquired | 18,397 | 18,397 | ||
Total Acquisitions | ||||
Total purchase consideration: | ||||
Cash paid | 103,498 | |||
Cash payable | 63,935 | |||
Contingent consideration | 13,161 | |||
Common stock issued | 21,952 | |||
Consideration transferred | 202,546 | |||
Assets: | ||||
Cash and cash equivalents | 54,139 | 54,139 | ||
Investment in marketable securities | 80 | 80 | ||
Receivables | 17,198 | 17,198 | ||
Prepaid expenses and other current assets | 47 | 47 | ||
Amounts due from affiliates | 3,909 | 3,909 | ||
Land, property and equipment | 823 | 823 | ||
Intangible assets | 52,503 | 52,503 | ||
Goodwill | 132,342 | 132,342 | ||
Restricted cash | 300 | 300 | ||
Total identifiable assets acquired | 261,341 | 261,341 | ||
Liabilities: | ||||
Accounts payable and accrued expenses | 11,858 | 11,858 | ||
Medical liabilities | 30,645 | 30,645 | ||
Amounts due to affiliates | 7,295 | 7,295 | ||
Income taxes payable | 1,638 | 1,638 | ||
Deferred tax liability | 6,931 | 6,931 | ||
Noncontrolling interest | 428 | 428 | ||
Total identified liabilities assumed | 58,795 | 58,795 | ||
Total net identifiable assets acquired | $ 202,546 | $ 202,546 |
Business Combinations, Asset _5
Business Combinations, Asset Acquisitions, and Goodwill - Schedule of Business Acquisition, Pro Forma Information, Nonrecurring Adjustments (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | ||
Business Acquisition, Pro Forma Revenue | $ 493,006 | $ 382,462 |
Business Acquisition, Pro Forma Net Income (Loss) | $ 16,661 | $ 20,324 |
Net income per share - basic (in dollars per share) | $ 0.35 | $ 0.44 |
Net income per share - diluted (in dollars per share) | $ 0.35 | $ 0.43 |
Business Combinations, Asset _6
Business Combinations, Asset Acquisitions, and Goodwill - Schedule of Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 278,831 |
Acquisitions | 132,342 |
Adjustments | (906) |
Ending balance | $ 410,267 |
Intangible Assets, Net - Schedu
Intangible Assets, Net - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Accumulated Amortization | $ (135,712) | $ (131,268) |
Total | 115,657 | |
Indefinite-lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross | 255,419 | 202,916 |
Intangible Assets, Net | 119,707 | 71,648 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite lived assets: | 2,150 | 2,150 |
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite lived assets: | 2,150 | 2,150 |
Licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite lived assets: | 1,900 | |
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite lived assets: | 1,900 | |
Network relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortized intangible assets, Gross | 155,978 | 150,679 |
Accumulated Amortization | (107,137) | (104,859) |
Total | $ 48,841 | $ 45,820 |
Network relationships | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 11 years | 11 years |
Network relationships | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 21 years | 21 years |
Management contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 15 years | 15 years |
Amortized intangible assets, Gross | $ 22,832 | $ 22,832 |
Accumulated Amortization | (17,002) | (16,662) |
Total | 5,830 | 6,170 |
Member relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortized intangible assets, Gross | 69,381 | 24,077 |
Accumulated Amortization | (9,154) | (7,345) |
Total | $ 60,227 | $ 16,732 |
Member relationships | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 7 years | 10 years |
Member relationships | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 14 years | 14 years |
Patient management platform | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 5 years | 5 years |
Amortized intangible assets, Gross | $ 2,060 | $ 2,060 |
Accumulated Amortization | (2,060) | (2,060) |
Total | $ 0 | $ 0 |
Tradename/trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 20 years | 20 years |
Amortized intangible assets, Gross | $ 1,011 | $ 1,011 |
Accumulated Amortization | (320) | (308) |
Total | $ 691 | $ 703 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 6 years | 6 years |
Amortized intangible assets, Gross | $ 107 | $ 107 |
Accumulated Amortization | (39) | (34) |
Total | $ 68 | $ 73 |
Intangible Assets, Net - Additi
Intangible Assets, Net - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 4,400,000 | $ 3,000,000 |
Impairment of finite-lived intangible assets | $ 0 | $ 0 |
Intangible Assets, Net - Sche_2
Intangible Assets, Net - Schedule of Future Amortization Expense (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2023 (excluding the nine months ended September 30, 2023) | $ 20,144 |
2025 | 22,373 |
2026 | 18,178 |
2027 | 14,746 |
2028 | 12,085 |
Thereafter | 28,131 |
Total | $ 115,657 |
Investments in Other Entities -
Investments in Other Entities - Schedule of Equity Method Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Equity Method Investments [Roll Forward] | ||
Beginning Balance | $ 25,774 | $ 40,299 |
Initial Investment | 9,487 | 325 |
Allocation of Net Income | 632 | 2,484 |
Distribution | 0 | 0 |
Ending Balance | $ 35,893 | $ 43,108 |
LaSalle Medical Associates – IPA line of business | ||
Schedule of Equity Method Investments [Line Items] | ||
% of Ownership | 25% | 25% |
Equity Method Investments [Roll Forward] | ||
Beginning Balance | $ 9,866 | $ 5,684 |
Initial Investment | 0 | 0 |
Allocation of Net Income | 359 | 2,165 |
Distribution | 0 | 0 |
Ending Balance | $ 10,225 | $ 7,849 |
Pacific Medical Imaging & Oncology Center, Inc. | ||
Schedule of Equity Method Investments [Line Items] | ||
% of Ownership | 40% | 40% |
Equity Method Investments [Roll Forward] | ||
Beginning Balance | $ 1,691 | $ 1,878 |
Initial Investment | 0 | 0 |
Allocation of Net Income | 27 | 8 |
Distribution | 0 | 0 |
Ending Balance | $ 1,718 | $ 1,886 |
531 W. College, LLC | ||
Schedule of Equity Method Investments [Line Items] | ||
% of Ownership | 50% | |
Equity Method Investments [Roll Forward] | ||
Beginning Balance | $ 17,281 | |
Initial Investment | 0 | |
Allocation of Net Income | (90) | |
Distribution | 0 | |
Ending Balance | $ 17,191 | |
One MSO, LLC | ||
Schedule of Equity Method Investments [Line Items] | ||
% of Ownership | 50% | |
Equity Method Investments [Roll Forward] | ||
Beginning Balance | $ 2,718 | |
Initial Investment | 0 | |
Allocation of Net Income | 115 | |
Distribution | 0 | |
Ending Balance | $ 2,833 | |
CAIPA MSO, LLC | ||
Schedule of Equity Method Investments [Line Items] | ||
% of Ownership | 30% | 30% |
Equity Method Investments [Roll Forward] | ||
Beginning Balance | $ 13,660 | $ 12,738 |
Initial Investment | 0 | 0 |
Allocation of Net Income | 186 | 249 |
Distribution | 0 | 0 |
Ending Balance | $ 13,846 | $ 12,987 |
I Health, Inc. | ||
Schedule of Equity Method Investments [Line Items] | ||
% of Ownership | 25% | 25% |
Equity Method Investments [Roll Forward] | ||
Beginning Balance | $ 0 | |
Initial Investment | 9,487 | |
Allocation of Net Income | 0 | |
Distribution | 0 | |
Ending Balance | $ 9,487 | |
Other | ||
Schedule of Equity Method Investments [Line Items] | ||
% of Ownership | 25% | 25% |
Equity Method Investments [Roll Forward] | ||
Beginning Balance | $ 557 | $ 0 |
Initial Investment | 0 | 325 |
Allocation of Net Income | 60 | 37 |
Distribution | 0 | 0 |
Ending Balance | $ 617 | $ 362 |
Investments in Other Entities_2
Investments in Other Entities - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Schedule of Equity Method Investments [Line Items] | ||
Impairment of investments | $ 0 | $ 0 |
I Health, Inc. | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity interest (as a percent) | 25% | 25% |
Loans Receivable (Details)
Loans Receivable (Details) - USD ($) $ in Millions | 1 Months Ended | |
Jul. 31, 2023 | Jan. 29, 2024 | |
IntraCare Convertible Promissory Note Receivable | Convertible Secured Promissory Note | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Revolving credit facility term | 5 years | |
Debt, principal sum | $ 25 | |
Interest rate (as a percent) | 8.81% | |
BASS Medical Group | Senior Secured Promissory Note | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Debt, principal sum | $ 20 | |
Interest rate (as a percent) | 8.21% |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Payables and Accruals [Abstract] | ||
Accounts payable and other accruals | $ 84,867 | $ 9,075 |
Capitation payable | 10,225 | 4,503 |
Subcontractor IPA payable | 2,529 | 2,529 |
Professional fees | 5,293 | 4,407 |
Due to related parties | 11,679 | 9,271 |
Contract liabilities | 3,017 | 744 |
Accrued compensation | 12,410 | 20,098 |
Other provider payable | 16,453 | 9,322 |
Total accounts payable and accrued expenses | $ 146,473 | $ 59,949 |
Medical Liabilities (Details)
Medical Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Medical Liabilities [Roll Forward] | ||
Medical liabilities, beginning of period | $ 106,657 | $ 81,255 |
Acquired (see Note 3) | 30,645 | 0 |
Components of medical care costs related to claims incurred: | ||
Current period | 235,237 | 223,713 |
Prior periods | (1,419) | (8,950) |
Total medical care costs | 233,818 | 214,763 |
Payments for medical care costs related to claims incurred: | ||
Current period | (136,286) | (136,743) |
Prior periods | (97,837) | (61,736) |
Total paid | (234,123) | (198,479) |
Adjustments | (503) | 857 |
Medical liabilities, end of period | $ 136,494 | $ 98,396 |
Credit Facility, Bank Loans, _3
Credit Facility, Bank Loans, and Lines of Credit - Schedule of Credit Facility (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Line of Credit Facility [Line Items] | ||
Total debt | $ 393,259 | $ 282,000 |
Less: Current portion of debt | (20,750) | (19,500) |
Less: Unamortized financing costs | (4,061) | (3,561) |
Long-term debt | 368,448 | 258,939 |
Term Loan | ||
Line of Credit Facility [Line Items] | ||
Total debt | 296,500 | 280,000 |
Promissory Note Payable | ||
Line of Credit Facility [Line Items] | ||
Total debt | $ 2,000 | $ 2,000 |
Credit Facility, Bank Loans, _4
Credit Facility, Bank Loans, and Lines of Credit - Schedule of Maturities (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Debt Disclosure [Abstract] | |
2024 | $ 17,000 |
2025 | 16,875 |
2026 | 117,259 |
2027 | 24,375 |
2028 | 217,750 |
Total | $ 393,259 |
Credit Facility, Bank Loans, _5
Credit Facility, Bank Loans, and Lines of Credit - Additional Information (Details) | 1 Months Ended | 3 Months Ended | ||||||
Nov. 03, 2023 USD ($) | Jun. 16, 2021 USD ($) | May 31, 2021 USD ($) | Mar. 31, 2024 USD ($) financial_ratio | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | Sep. 08, 2023 USD ($) | Sep. 10, 2019 USD ($) | |
Debt Instrument [Line Items] | ||||||||
Total debt | $ 393,259,000 | $ 282,000,000 | ||||||
Average effective interest rate | 5.69% | 6.51% | ||||||
Loan from company | $ 393,259,000 | |||||||
Deferred financing costs | 5,700,000 | 6,100,000 | ||||||
Unamortized deferred financing costs | 4,061,000 | 3,561,000 | ||||||
Interest expense | $ 7,585,000 | $ 3,269,000 | ||||||
Minimum | Secured Overnight Financing Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.50% | |||||||
Minimum | Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 0.50% | |||||||
Maximum | Secured Overnight Financing Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 2.75% | |||||||
Maximum | Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.75% | |||||||
Line of Credit | Astrana Medical | ||||||||
Debt Instrument [Line Items] | ||||||||
Loan from company | $ 545,000,000 | |||||||
Revolver Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Total debt | 94,759,000 | 0 | ||||||
Amended Credit Agreement | Truist Bank | Standby Letters of Credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum loan availability | $ 31,800,000 | |||||||
Term of facility | 1 year | |||||||
Amended Credit Agreement | Minimum | Secured Overnight Financing Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.25% | |||||||
Amended Credit Agreement | Minimum | Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 0.25% | |||||||
Amended Credit Agreement | Maximum | Secured Overnight Financing Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 2.50% | |||||||
Amended Credit Agreement | Maximum | Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.50% | |||||||
Credit Agreement Amendment | ||||||||
Debt Instrument [Line Items] | ||||||||
Drawdowns | $ 296,500,000 | |||||||
Credit Agreement Amendment | Line of Credit | Truist Bank | ||||||||
Debt Instrument [Line Items] | ||||||||
Amount funded at closing | $ 300,000,000 | |||||||
Credit Agreement Amendment | Secured Debt | Truist Bank | Debt Instrument, Redemption, Period One | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate (as a percent) | 5% | |||||||
Credit Agreement Amendment | Secured Debt | Truist Bank | Debt Instrument, Redemption, Period Two | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate (as a percent) | 7.50% | |||||||
Credit Agreement Amendment | Secured Debt | Truist Bank | Debt Instrument, Redemption, Period Three | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate (as a percent) | 10% | |||||||
Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Average effective interest rate | 7.68% | |||||||
Number of key financial ratios | financial_ratio | 2 | |||||||
Maximum consolidated leverage ratio (not greater than) | 3.75 | |||||||
Debt covenant, aggregate purchase price, maximum | $ 75,000,000 | |||||||
Consolidated leverage ratio, annual decrease | 0.25 | |||||||
Debt instrument, covenant, leverage ratio, adjusted maximum | 4 | |||||||
Minimum consolidated interest coverage ratio (not less than) | 3.25 | |||||||
Interest expense | $ 500,000 | $ 200,000 | ||||||
Subordinated Loan Agreement | Subordinated Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1% | |||||||
Debt, principal sum | $ 2,000,000 | |||||||
Revolver Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Repayments | $ 180,000,000 | |||||||
Proceeds from (repayments of) bank overdrafts | $ 120,000,000 | |||||||
Revolver Loan | Amended Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Revolving credit facility term | 5 years | |||||||
Interest rate | 7.42% | |||||||
Revolver Loan | Amended Credit Agreement | Line of Credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum loan availability | $ 400,000,000 | |||||||
Bridge Loan | Amended Credit Agreement | Line of Credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum loan availability | 25,000,000 | |||||||
Letter of Credit | Amended Credit Agreement | Line of Credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum loan availability | $ 25,000,000 | $ 50,000,000 | ||||||
New Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Unamortized deferred financing costs | $ 1,600,000 | $ 2,600,000 | ||||||
Line of Credit | APC Business Loan Agreement | Preferred Bank | Allied Pacific Of California IPA | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum loan availability | $ 4,100,000 | |||||||
Standby Letters of Credit | Allied Pacific Of California IPA | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum loan availability | $ 3,900,000 | |||||||
Term of facility | 1 year |
Mezzanine and Stockholders' E_2
Mezzanine and Stockholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Class of Stock [Line Items] | |||
Holdback shares not issued to former shareholders (in shares) | 41,048 | ||
Treasury shares (in shares) | 10,584,340 | 10,584,340 | |
Treasury stock repurchased (in shares) | 3,451,642 | 3,451,642 | |
Payments of ordinary dividends common stock | $ 95 | $ 120 | |
APC | |||
Class of Stock [Line Items] | |||
Treasury shares (in shares) | 7,132,698 | 7,132,698 | |
APC | Apollo Medical Holdings, Inc | |||
Class of Stock [Line Items] | |||
Equity interest (as a percent) | 13.04% | 13.22% | |
CDSC | |||
Class of Stock [Line Items] | |||
Payments of ordinary dividends common stock | $ 100 | $ 100 | |
Company And APC | |||
Class of Stock [Line Items] | |||
Treasury shares (in shares) | 10,584,340 | 10,584,340 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Share-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation expense | $ 5,748 | $ 3,445 |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation expense | 349 | 566 |
Restricted stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation expense | $ 5,399 | $ 2,879 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2024 USD ($) $ / shares shares | Mar. 31, 2023 USD ($) shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation expense | $ | $ 42.4 | |
Shares issued for exercise of options and warrants (in shares) | 0 | 125,000 |
Restricted Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted stock awards granted (in shares) | 296,428 | |
Contingent on performance (in shares) | 255,781 | |
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 40.65 | |
Performance Based Restricted Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 43.88 | |
Employee Stock Purchase Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock, discounted price, percentage | 0.85 | |
Common stock, discounted price, percentage (up to) | 0.90 | |
Number of shares authorized for issuance (in shares) | 5,000,000 | |
APC Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Purchase price adjustment from merger | $ | $ 1.3 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Stock Option Transactions Under Stock Option Plans (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Shares | |||
Beginning balance (in shares) | 496,970 | 504,241 | |
Options granted (in shares) | 0 | ||
Options exercised (in shares) | 0 | (125,000) | |
Options forfeited (in shares) | (7,271) | ||
Options outstanding, ending balance (in shares) | 496,970 | 504,241 | |
Options exercisable (in shares) | 459,140 | ||
Weighted Average Exercise Price | |||
Options outstanding, beginning balance (in dollars per share) | $ 34.03 | ||
Options granted (in dollars per share) | 0 | ||
Options exercised (in dollars per share) | 0 | ||
Options forfeited (in dollars per share) | 50.56 | ||
Options outstanding, ending balance (in dollars per share) | 33.79 | $ 34.03 | |
Options exercisable (in dollars per share) | $ 28.04 | ||
Weighted Average Remaining Contractual Term (Years) | |||
Options outstanding | 1 year 7 months 9 days | 2 years 1 month 6 days | |
Options exercisable | 1 year 4 months 28 days | ||
Aggregate Intrinsic Value (in millions) | |||
Options outstanding | $ 8,400 | $ 4,700 | |
Options exercisable | $ 8,400 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Commitments And Contingencies [Line Items] | |
Amount outstanding | $ 393,259 |
Amended Credit Agreement | Truist Bank | Standby Letters of Credit | |
Commitments And Contingencies [Line Items] | |
Maximum loan availability | $ 31,800 |
Related-Party Transactions - Ad
Related-Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Related Party Transaction [Line Items] | |||
Revenue | $ 404,356 | $ 337,244 | |
Operating lease right-of-use assets | 39,152 | $ 37,396 | |
Operating lease liabilities | 5,007 | 4,607 | |
Expenses payable | 600 | 400 | |
Risk pool settlements and incentives | |||
Related Party Transaction [Line Items] | |||
Revenue | 17,377 | 13,462 | |
Song PC | Provider Services | |||
Related Party Transaction [Line Items] | |||
Related party transaction, amount of transaction | 200 | 200 | |
AHMC | |||
Related Party Transaction [Line Items] | |||
Amount outstanding under agreement | 58,800 | 54,000 | |
AHMC | Related Party | Risk pool settlements and incentives | |||
Related Party Transaction [Line Items] | |||
Revenue | 8,100 | 13,000 | |
Allied Pacific Holdings Investment Management, LLC | Chief Executive Officer | |||
Related Party Transaction [Line Items] | |||
Operating lease right-of-use assets | 12,700 | 14,100 | |
Operating lease liabilities | 13,200 | $ 14,500 | |
AHMC | LMA | Related Party | |||
Related Party Transaction [Line Items] | |||
Revenue | 5,000 | ||
AHMC | Arroyo Vista | Related Party | |||
Related Party Transaction [Line Items] | |||
Revenue | 500 | 500 | |
APC | Board Member | |||
Related Party Transaction [Line Items] | |||
Payments for repurchase of shares | 0 | 9,500 | |
APC | PMIOC | Provider Services | |||
Related Party Transaction [Line Items] | |||
Related party transaction, amount of transaction | 800 | 600 | |
APC | Sunny Village Care Center | Provider Services | |||
Related Party Transaction [Line Items] | |||
Related party transaction, amount of transaction | 45 | 200 | |
APC | Board Members | Provider Services | |||
Related Party Transaction [Line Items] | |||
Related party transaction, amount of transaction | 4,700 | 9,400 | |
APC | Board Members Who Are Also Officers | Provider Services | |||
Related Party Transaction [Line Items] | |||
Related party transaction, amount of transaction | 800 | 900 | |
NMM | Arroyo Vista | Provider Services | |||
Related Party Transaction [Line Items] | |||
Related party transaction, amount of transaction | 100 | 64 | |
AMG | First Commonwealth Property, LLC | Office Lease | |||
Related Party Transaction [Line Items] | |||
Related party transaction, amount of transaction | 38 | ||
AMG | Allied Pacific Holdings Investment Management, LLC | Office Lease | |||
Related Party Transaction [Line Items] | |||
Related party transaction, amount of transaction | $ 900 | $ 900 | |
PMIOC | APC | |||
Related Party Transaction [Line Items] | |||
Equity interest (as a percent) | 40% | ||
Song PC | Astrana Medical | |||
Related Party Transaction [Line Items] | |||
Equity interest (as a percent) | 25% |
Related-Party Transactions - Sc
Related-Party Transactions - Schedule of Fees Incurred and Revenue Earned from Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
AHMC | Revenue | ||
Related Party Transaction [Line Items] | ||
Related party transaction, amount of transaction | $ 9,920 | $ 14,484 |
AHMC | Expenses | ||
Related Party Transaction [Line Items] | ||
Related party transaction, amount of transaction | 7,557 | 6,400 |
AHMC | Net | ||
Related Party Transaction [Line Items] | ||
Related party transaction, amount of transaction | 2,363 | 8,084 |
HSMSO | Revenue | ||
Related Party Transaction [Line Items] | ||
Related party transaction, amount of transaction | 301 | 315 |
HSMSO | Expenses | ||
Related Party Transaction [Line Items] | ||
Related party transaction, amount of transaction | 0 | 169 |
HSMSO | Net | ||
Related Party Transaction [Line Items] | ||
Related party transaction, amount of transaction | 301 | 146 |
Aurion | Revenue | ||
Related Party Transaction [Line Items] | ||
Related party transaction, amount of transaction | 0 | 0 |
Aurion | Expenses | ||
Related Party Transaction [Line Items] | ||
Related party transaction, amount of transaction | 50 | 50 |
Aurion | Net | ||
Related Party Transaction [Line Items] | ||
Related party transaction, amount of transaction | $ (50) | $ (50) |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate | 29.80% | 35.70% |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Details) - shares | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Restricted Stock | |||
Earnings Per Share [Line Items] | |||
Antidilutive securities not included in the calculation of earnings per share (in shares) | 118,142 | 136,932 | |
Performance Shares | |||
Earnings Per Share [Line Items] | |||
Antidilutive securities not included in the calculation of earnings per share (in shares) | 973,461 | 395,472 | |
APC | |||
Earnings Per Share [Line Items] | |||
Antidilutive securities not included in the calculation of earnings per share (in shares) | 7,132,698 | 7,132,698 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Earnings Per Share Computations (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Earnings Per Share [Abstract] | ||
Earnings per share – basic (in dollars per share) | $ 0.31 | $ 0.28 |
Earnings per share – diluted (in dollars per share) | $ 0.31 | $ 0.28 |
Weighted average shares of common stock outstanding – basic (in shares) | 47,260,351 | 46,555,406 |
Weighted average shares of common stock outstanding – diluted (in shares) | 47,699,537 | 46,954,687 |
Earnings Per Share - Schedule_2
Earnings Per Share - Schedule of Shares Included in the Diluted Earnings Per Share Computations (Details) - shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Earnings Per Share [Line Items] | ||
Weighted average shares of common stock outstanding – basic (in shares) | 47,260,351 | 46,555,406 |
Contingently issuable shares (in shares) | 25,975 | 44,157 |
Weighted average shares of common stock outstanding – diluted (in shares) | 47,699,537 | 46,954,687 |
Stock options | ||
Earnings Per Share [Line Items] | ||
Adjustments to weighted average shares of common stock (in shares) | 188,083 | 306,933 |
Restricted stock | ||
Earnings Per Share [Line Items] | ||
Adjustments to weighted average shares of common stock (in shares) | 225,128 | 48,191 |
Variable Interest Entities (V_3
Variable Interest Entities (VIEs)- Additional Information (Details) | 3 Months Ended | |
Jan. 01, 2024 | Mar. 31, 2024 | |
Variable Interest Entity, Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Variable interest entity, ownership percentage | 25% | 100% |
Variable Interest Entities (V_4
Variable Interest Entities (VIEs) (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | |
Current assets | |||||
Cash and cash equivalents | $ 334,796 | $ 293,807 | $ 274,613 | ||
Investment in marketable securities | 2,490 | 2,498 | |||
Income taxes receivable | 0 | 10,657 | |||
Other receivables | 1,783 | 1,335 | |||
Prepaid expenses and other current assets | 17,281 | 17,450 | |||
Total current assets | 538,810 | 461,507 | |||
Non-current assets | |||||
Intangible assets, net | 119,707 | 71,648 | |||
Goodwill | 410,267 | 278,831 | |||
Income taxes receivable, non-current | 15,943 | 15,943 | |||
Investments in other entities – equity method | 35,893 | 25,774 | 43,108 | $ 40,299 | |
Operating lease right-of-use assets | 39,152 | 37,396 | |||
Other assets | 4,067 | 1,877 | |||
Total non-current assets | 687,467 | 471,854 | |||
Total assets | [1] | 1,226,277 | 933,361 | ||
Current liabilities | |||||
Accounts payable and accrued expenses | 146,473 | 59,949 | |||
Fiduciary accounts payable | 7,792 | 7,737 | |||
Medical liabilities | 136,494 | 106,657 | $ 98,396 | $ 81,255 | |
Dividend payable | 638 | 638 | |||
Finance lease liabilities | 636 | 646 | |||
Operating lease liabilities | 5,007 | 4,607 | |||
Current portion of long-term debt | 20,750 | 19,500 | |||
Other liabilities | 31,960 | 18,940 | |||
Total current liabilities | 355,272 | 218,674 | |||
Non-current liabilities | |||||
Finance lease liabilities, net of current portion | 1,015 | 1,033 | |||
Operating lease liabilities, net of current portion | 37,716 | 36,289 | |||
Deferred tax liability | 3,756 | 4,072 | |||
Other long-term liabilities | 7,652 | 3,586 | |||
Total non-current liabilities | 418,587 | 303,919 | |||
Total liabilities | [1] | 773,859 | 522,593 | ||
Nonrelated Party | |||||
Current assets | |||||
Receivables, net | 120,106 | 76,780 | |||
Related Party | |||||
Current assets | |||||
Receivables, net | 62,354 | 58,980 | |||
Variable Interest Entity, Primary Beneficiary | |||||
Current assets | |||||
Cash and cash equivalents | 212,134 | 184,078 | |||
Investment in marketable securities | 50 | 0 | |||
Income taxes receivable | 0 | 1,600 | |||
Other receivables | 997 | 454 | |||
Prepaid expenses and other current assets | 11,891 | 9,991 | |||
Total current assets | 334,111 | 275,950 | |||
Non-current assets | |||||
Land, property and equipment, net | 5,084 | 5,306 | |||
Intangible assets, net | 85,058 | 60,906 | |||
Goodwill | 236,961 | 140,157 | |||
Income taxes receivable, non-current | 15,943 | 15,943 | |||
Investments in other entities – equity method | 12,560 | 12,114 | |||
Investment in affiliates | 299,502 | 273,182 | |||
Investment in a privately held entity | 405 | 405 | |||
Restricted cash | 40 | 40 | |||
Operating lease right-of-use assets | 26,082 | 28,796 | |||
Other assets | 1,214 | 1,149 | |||
Total non-current assets | 682,849 | 537,998 | |||
Total assets | 1,016,960 | 813,948 | |||
Current liabilities | |||||
Accounts payable and accrued expenses | 44,058 | 32,707 | |||
Fiduciary accounts payable | 7,792 | 7,737 | |||
Medical liabilities | 69,611 | 55,157 | |||
Dividend payable | 638 | 638 | |||
Income tax payable | 8,431 | 0 | |||
Finance lease liabilities | 602 | 646 | |||
Operating lease liabilities | 3,092 | 3,305 | |||
Current portion of long-term debt | 0 | 8,542 | |||
Amount due to affiliates | 110,117 | 107,340 | |||
Other liabilities | 9,387 | 0 | |||
Total current liabilities | 253,728 | 216,072 | |||
Non-current liabilities | |||||
Finance lease liabilities, net of current portion | 905 | 1,033 | |||
Operating lease liabilities, net of current portion | 26,186 | 28,675 | |||
Deferred tax liability | 7,166 | 7,284 | |||
Other long-term liabilities | 1,690 | 230 | |||
Total non-current liabilities | 35,947 | 37,222 | |||
Total liabilities | 289,675 | 253,294 | |||
Variable Interest Entity, Primary Beneficiary | Nonrelated Party | |||||
Current assets | |||||
Receivables, net | 47,169 | 21,120 | |||
Variable Interest Entity, Primary Beneficiary | Related Party | |||||
Current assets | |||||
Receivables, net | $ 61,870 | $ 58,707 | |||
[1] The Company’s condensed consolidated balance sheets include the assets and liabilities of its consolidated VIEs. The condensed consolidated balance sheets include total assets that can be used only to settle obligations of the Company’s consolidated VIEs totaling $717.5 million and $540.8 million as of March 31, 2024 and December 31, 2023, respectively, and total liabilities of the Company’s consolidated VIEs for which creditors do not have recourse to the general credit of the primary beneficiary of $179.6 million and $146.0 million as of March 31, 2024 and December 31, 2023, respectively. These VIE balances do not include $299.5 million of investment in affiliates and $110.1 million of amounts due to affiliates as of March 31, 2024, and $273.2 million of investment in affiliates and $107.3 million of amounts due to affiliates as of December 31, 2023, as these are eliminated upon consolidation and not presented within the condensed consolidated balance sheets. See Note 16 — “Variable Interest Entities (VIEs)” for further details. |
Leases - Additional information
Leases - Additional information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | |
Lessee, Lease, Description [Line Items] | ||
Operating lease option to extend (up to) | 10 years | |
Finance lease option to extend (up to) | 10 years | |
Operating lease, termination period, if applicable | 1 year | |
Finance lease, termination period, if applicable | 1 year | |
Assets recorded under finance leases | $ 1.7 | $ 1.7 |
Accumulated depreciation associated with finance leases | $ 1.8 | $ 1.6 |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Remaining lease term, operating | 4 months | |
Remaining lease term, finance | 4 months | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Remaining lease term, operating | 17 years | |
Remaining lease term, finance | 17 years |
Leases - Schedule of Components
Leases - Schedule of Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Leases [Abstract] | ||
Operating lease cost | $ 3,159 | $ 1,751 |
Finance lease cost | ||
Amortization of lease expense | 179 | 154 |
Interest on lease liabilities | 24 | 22 |
Sublease income | (226) | (248) |
Total lease cost, net | $ 3,136 | $ 1,679 |
Leases - Schedule of Other Info
Leases - Schedule of Other Information Related to Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 2,837 | $ 1,742 |
Operating cash flows from finance leases | 24 | 22 |
Financing cash flows from finance leases | $ 179 | $ 154 |
Weighted Average Remaining Lease Term | ||
Operating leases | 8 years 4 months 20 days | 6 years 7 months 20 days |
Finance leases | 2 years 11 months 15 days | 3 years 2 months 19 days |
Weighted Average Discount Rate | ||
Operating leases | 6.15% | 5.63% |
Finance leases | 5.53% | 4.95% |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Payments Under Non-cancelable Leases (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Operating Leases | ||
2024 (excluding the three months ended March 31, 2024) | $ 5,597 | |
2025 | 7,362 | |
2026 | 7,007 | |
2027 | 6,722 | |
2028 | 6,545 | |
Thereafter | 22,558 | |
Total future minimum lease payments | 55,791 | |
Less: imputed interest | 13,068 | |
Total lease liabilities | 42,723 | |
Less: current portion | 5,007 | $ 4,607 |
Long-term lease liabilities | 37,716 | 36,289 |
Finance Leases | ||
2024 (excluding the three months ended March 31, 2024) | 560 | |
2025 | 599 | |
2026 | 345 | |
2027 | 265 | |
2028 | 27 | |
Thereafter | 7 | |
Total future minimum lease payments | 1,803 | |
Less: imputed interest | 152 | |
Total lease liabilities | 1,651 | |
Less: current portion | 636 | 646 |
Long-term lease liabilities | $ 1,015 | $ 1,033 |
Segments (Details)
Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Segment Reporting Information [Line Items] | ||
Total revenue | $ 404,356 | $ 337,244 |
Cost of services | 330,399 | 289,397 |
General and administrative | 43,818 | 25,474 |
Total expenses | 374,217 | 314,871 |
Income (loss) from operations | 30,139 | 22,373 |
Third-Party | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 404,356 | 337,244 |
Intersegment | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 0 | 0 |
Intersegment Elimination | ||
Segment Reporting Information [Line Items] | ||
Total revenue | (56,732) | (33,598) |
Cost of services | (26,734) | (13,302) |
General and administrative | (30,075) | (21,460) |
Total expenses | (56,809) | (34,762) |
Income (loss) from operations | 77 | 1,164 |
Intersegment Elimination | Third-Party | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 0 | 0 |
Intersegment Elimination | Intersegment | ||
Segment Reporting Information [Line Items] | ||
Total revenue | (56,732) | (33,598) |
Corporate Costs | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 0 | 0 |
Cost of services | 0 | 0 |
General and administrative | 16,400 | 5,409 |
Total expenses | 16,400 | 5,409 |
Income (loss) from operations | (16,400) | (5,409) |
Corporate Costs | Third-Party | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 0 | 0 |
Corporate Costs | Intersegment | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 0 | 0 |
Care Partners | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 397,095 | 314,653 |
Cost of services | 314,966 | 266,323 |
General and administrative | 38,933 | 26,009 |
Total expenses | 353,899 | 292,332 |
Income (loss) from operations | 43,196 | 22,321 |
Care Partners | Operating Segments | Third-Party | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 382,318 | 314,637 |
Care Partners | Operating Segments | Intersegment | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 14,777 | 16 |
Care Delivery | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 30,719 | 25,383 |
Cost of services | 24,794 | 20,692 |
General and administrative | 6,163 | 5,657 |
Total expenses | 30,957 | 26,349 |
Income (loss) from operations | (238) | (966) |
Care Delivery | Operating Segments | Third-Party | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 17,878 | 12,263 |
Care Delivery | Operating Segments | Intersegment | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 12,841 | 13,120 |
Care Enablement | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 33,274 | 30,566 |
Cost of services | 17,373 | 15,621 |
General and administrative | 12,397 | 9,199 |
Total expenses | 29,770 | 24,820 |
Income (loss) from operations | 3,504 | 5,746 |
Care Enablement | Operating Segments | Third-Party | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 4,160 | 10,139 |
Care Enablement | Operating Segments | Intersegment | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 29,114 | 20,427 |
Other | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 0 | 240 |
Cost of services | 0 | 63 |
General and administrative | 0 | 660 |
Total expenses | 0 | 723 |
Income (loss) from operations | 0 | (483) |
Other | Operating Segments | Third-Party | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 0 | 205 |
Other | Operating Segments | Intersegment | ||
Segment Reporting Information [Line Items] | ||
Total revenue | $ 0 | $ 35 |
Fair Value Measurements of Fi_3
Fair Value Measurements of Financial Instruments - Schedule of Carrying Amounts and Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market accounts | $ 31,804 | $ 4,842 |
Marketable securities – certificates of deposit | 2,258 | 2,150 |
Marketable securities – equity securities | 232 | 348 |
Total assets | 34,732 | 7,340 |
Total liabilities | 36,908 | 22,088 |
AAMG contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 7,407 | 5,475 |
VOMG contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 17 | 17 |
DMG remaining equity interest purchase | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Remaining equity interest purchase | 8,542 | 8,542 |
Sun Labs remaining equity interest purchase | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Remaining equity interest purchase | 7,278 | 7,802 |
ADSC contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 3,632 | |
CFC contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 7,767 | |
PCCCV contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 2,265 | |
Interest Rate Collar | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate collar | 438 | |
Derivative liability | 252 | |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market accounts | 31,804 | 4,842 |
Marketable securities – certificates of deposit | 2,258 | 2,150 |
Marketable securities – equity securities | 232 | 348 |
Total assets | 34,294 | 7,340 |
Total liabilities | 0 | 0 |
Level 1 | AAMG contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 0 | 0 |
Level 1 | VOMG contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 0 | 0 |
Level 1 | DMG remaining equity interest purchase | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Remaining equity interest purchase | 0 | 0 |
Level 1 | Sun Labs remaining equity interest purchase | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Remaining equity interest purchase | 0 | 0 |
Level 1 | ADSC contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 0 | |
Level 1 | CFC contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 0 | |
Level 1 | PCCCV contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 0 | |
Level 1 | Interest Rate Collar | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate collar | 0 | |
Derivative liability | 0 | |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market accounts | 0 | 0 |
Marketable securities – certificates of deposit | 0 | 0 |
Marketable securities – equity securities | 0 | 0 |
Total assets | 438 | 0 |
Total liabilities | 0 | 252 |
Level 2 | AAMG contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 0 | 0 |
Level 2 | VOMG contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 0 | 0 |
Level 2 | DMG remaining equity interest purchase | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Remaining equity interest purchase | 0 | 0 |
Level 2 | Sun Labs remaining equity interest purchase | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Remaining equity interest purchase | 0 | 0 |
Level 2 | ADSC contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 0 | |
Level 2 | CFC contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 0 | |
Level 2 | PCCCV contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 0 | |
Level 2 | Interest Rate Collar | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate collar | 438 | |
Derivative liability | 252 | |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market accounts | 0 | 0 |
Marketable securities – certificates of deposit | 0 | 0 |
Marketable securities – equity securities | 0 | 0 |
Total assets | 0 | 0 |
Total liabilities | 36,908 | 21,836 |
Level 3 | AAMG contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 7,407 | 5,475 |
Level 3 | VOMG contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 17 | 17 |
Level 3 | DMG remaining equity interest purchase | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Remaining equity interest purchase | 8,542 | 8,542 |
Level 3 | Sun Labs remaining equity interest purchase | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Remaining equity interest purchase | 7,278 | 7,802 |
Level 3 | ADSC contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 3,632 | |
Level 3 | CFC contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 7,767 | |
Level 3 | PCCCV contingent considerations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Value of the contingent consideration | 2,265 | |
Level 3 | Interest Rate Collar | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate collar | $ 0 | |
Derivative liability | $ 0 |
Fair Value Measurements of Fi_4
Fair Value Measurements of Financial Instruments - Schedule of Change in Fair Value of Level 3 Liabilities (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balance | $ 21,836 |
Additions | 13,161 |
Change in fair value of existing Level 3 liabilities | 1,911 |
Ending balance | $ 36,908 |
Fair Value Measurements of Fi_5
Fair Value Measurements of Financial Instruments - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||||
Jan. 31, 2024 | Mar. 31, 2024 | Mar. 31, 2023 | Jan. 01, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | Oct. 31, 2022 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Marketable securities – certificates of deposit | $ 2,258 | $ 2,150 | |||||
Equity securities | 232 | 348 | |||||
Unrealized gain (loss) on investments | 1,099 | $ (6,392) | |||||
Investments in other entities – equity method | 35,893 | 43,108 | 25,774 | $ 40,299 | |||
Apollo-Sun Labs Management, LLC | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Equity interest purchase obligation, noncurrent | 7,300 | 7,800 | |||||
Change in fair value of equity interest | $ 500 | $ 1,400 | |||||
AAMG contingent consideration | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Interest acquired | 100% | ||||||
AAMG contingent consideration | 2023 Metric | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Equity interest issued, number of shares (shares) | 157,048 | ||||||
AAMG contingent consideration | 2024 Metric | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Equity interest issued, number of shares (shares) | 184,361 | ||||||
AAMG contingent consideration | Other Liabilities | 2023 Metric | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Value of the contingent consideration | $ 3,500 | 2,600 | |||||
AAMG contingent consideration | Other Noncurrent Liabilities | 2023 Metric | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Value of the contingent consideration | 5,600 | 5,600 | |||||
AAMG contingent consideration | Other Noncurrent Liabilities | 2024 Metric | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Value of the contingent consideration | 3,900 | 2,900 | |||||
Advanced Diagnostic and Surgical Center, Inc | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Interest acquired | 95% | ||||||
Value of the contingent consideration | $ 3,600 | ||||||
Advanced Diagnostic and Surgical Center, Inc | Other Noncurrent Liabilities | 2023 Metric | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Value of the contingent consideration | 2,000 | ||||||
Advanced Diagnostic and Surgical Center, Inc | Other Noncurrent Liabilities | 2024 Metric | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Value of the contingent consideration | 1,600 | ||||||
Community Family Care Medical Group IPA, Inc. | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Equity interest issued, number of shares (shares) | 631,712 | ||||||
Community Family Care Medical Group IPA, Inc. | Other Noncurrent Liabilities | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Value of the contingent consideration | 15,000 | ||||||
Contingent consideration, liability, each measurement period | 5,000 | ||||||
Community Family Care Medical Group IPA, Inc. | Other Noncurrent Liabilities | First Metric | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Value of the contingent consideration | 3,100 | ||||||
Community Family Care Medical Group IPA, Inc. | Other Noncurrent Liabilities | Second Metric | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Value of the contingent consideration | 2,800 | ||||||
Community Family Care Medical Group IPA, Inc. | Other Noncurrent Liabilities | Third Metric | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Value of the contingent consideration | 1,900 | ||||||
PCCCV | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Value of the contingent consideration | $ 2,300 | ||||||
DMG And Sun Labs | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Equity interest purchase obligation, period to purchase | 3 years | ||||||
DMG remaining equity interest purchase | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Investments in other entities – equity method | $ 8,500 | ||||||
Interest Rate Collar | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Derivative, ceiling interest rate | 5% | ||||||
Derivative, floor interest rate | 2.34% | ||||||
Derivative asset, fair value | $ 400 | 300 | |||||
Unrealized gain (loss) on investments | $ 700 | ||||||
Certificates of Deposit | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Short-term marketable securities, maturity period | 90 days | ||||||
Marketable securities – certificates of deposit | $ 2,300 | $ 2,200 |
Fair Value Measurements of Fi_6
Fair Value Measurements of Financial Instruments - Schedule of Gain (Loss) on Equity Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | ||
Total losses recognized on equity securities | $ (116) | $ (4,353) |
Gains recognized on equity securities sold | 0 | 0 |
Unrealized losses recognized on equity securities held at end of period | $ (116) | $ (4,353) |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | 1 Months Ended | |||
Apr. 01, 2024 | May 09, 2024 | Mar. 31, 2024 | Mar. 31, 2023 | |
Subsequent Event [Line Items] | ||||
Drew down on revolver loan | $ 393,259 | |||
I Health, Inc. | ||||
Subsequent Event [Line Items] | ||||
Equity interest (as a percent) | 25% | 25% | ||
Subsequent Event | Revolver Loan | ||||
Subsequent Event [Line Items] | ||||
Proceeds from Lines of Credit | $ 52,000 | |||
Subsequent Event | I Health Promissiory Note | ||||
Subsequent Event [Line Items] | ||||
Proceeds from promissory note | $ 8,300 | |||
Interest rate (as a percent) | 4.30% |