DEI Info Cover Page Document
DEI Info Cover Page Document - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 30, 2018 | |
Entity Information [Abstract] | ||
Entity Registrant Name | ENSIGN GROUP, INC | |
Entity Central Index Key | 1,125,376 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 51,795,207 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 35,057 | $ 42,337 |
Accounts receivable—less allowance for doubtful accounts of $1,762 and $43,961 at March 31, 2018 and December 31, 2017, respectively (Note 3) | 258,509 | 265,068 |
Investments—current | 13,631 | 13,092 |
Prepaid income taxes | 12,794 | 19,447 |
Prepaid expenses and other current assets | 24,735 | 28,132 |
Total current assets | 344,726 | 368,076 |
Property and equipment, net | 541,019 | 537,084 |
Insurance subsidiary deposits and investments | 28,065 | 28,685 |
Escrow deposits | 10,025 | 228 |
Deferred tax asset | 12,731 | 12,745 |
Restricted and other assets | 17,695 | 16,501 |
Intangible assets, net | 32,236 | 32,803 |
Goodwill | 80,963 | 81,062 |
Other indefinite-lived intangibles | 25,249 | 25,249 |
Total assets | 1,092,709 | 1,102,433 |
Current liabilities: | ||
Accounts payable | 31,977 | 39,043 |
Accrued wages and related liabilities | 84,018 | 90,508 |
Accrued self-insurance liabilities—current | 22,163 | 22,516 |
Other accrued liabilities | 63,088 | 63,815 |
Current maturities of long-term debt | 10,035 | 9,939 |
Total current liabilities | 211,281 | 225,821 |
Long-term debt—less current maturities | 280,449 | 302,990 |
Accrued self-insurance liabilities—less current portion | 51,518 | 50,220 |
Deferred rent and other long-term liabilities | 11,608 | 11,268 |
Deferred gain related to sale-leaseback (Note 16) | 11,910 | 12,075 |
Total liabilities | 566,766 | 602,374 |
Commitments and contingencies (Notes 14, 16 and 17) | ||
Equity: | ||
Common stock; $0.001 par value; 75,000 shares authorized; 54,083 and 51,764 shares issued and outstanding at March 31, 2018, respectively, and 53,675 and 51,360 shares issued and outstanding at December 31, 2017, respectively (Note 18) | 54 | 53 |
Additional paid-in capital | 270,948 | 266,058 |
Retained earnings | 285,398 | 264,691 |
Common stock in treasury, at cost, 1,932 shares at March 31, 2018 and December 31, 2017, respectively | (38,405) | (38,405) |
Total Ensign Group, Inc. stockholders' equity | 517,995 | 492,397 |
Non-controlling interest | 7,948 | 7,662 |
Total equity | 525,943 | 500,059 |
Total liabilities and equity | $ 1,092,709 | $ 1,102,433 |
Consolidated Balance Sheets Bal
Consolidated Balance Sheets Balance Sheet (Paranthetical) - USD ($) shares in Thousands, $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Allowance for doubtful accounts | $ 1,762 | $ 43,961 |
Equity: | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 75,000 | 75,000 |
Common stock, shares issued | 54,083 | 53,675 |
Common stock, shares outstanding | 51,764 | 51,360 |
Common stock in treasury, at cost | 1,932 | 1,932 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Revenue | ||
Service revenue | $ 456,021 | $ 409,393 |
Assisted and independent living revenue | 36,113 | 32,346 |
Total revenue | 492,134 | 441,739 |
Expense | ||
Cost of services | 390,243 | 355,486 |
(Return of unclaimed class action settlement)/charges related to class action lawsuit (Note 17) | (1,664) | 11,000 |
Losses related to divestitures (Note 6 and 16) | 0 | 4,017 |
Rent—cost of services (Note 16) | 33,850 | 31,900 |
General and administrative expense | 25,104 | 21,270 |
Depreciation and amortization | 11,622 | 10,514 |
Total expenses | 459,155 | 434,187 |
Income from operations | 32,979 | 7,552 |
Other income (expense): | ||
Interest expense | (3,613) | (3,445) |
Interest income | 448 | 290 |
Other expense, net | (3,165) | (3,155) |
Income before provision for income taxes | 29,814 | 4,397 |
Provision for income taxes | 6,521 | 1,441 |
Net income | 23,293 | 2,956 |
Less: net income attributable to noncontrolling interests | 161 | 116 |
Net income attributable to The Ensign Group, Inc. | $ 23,132 | $ 2,840 |
Basic: | ||
Basic net income per common share attributable to The Ensign Group, Inc. | $ 0.45 | $ 0.06 |
Diluted: | ||
Diluted net income per common share attributable to The Ensign Group, Inc. | $ 0.43 | $ 0.05 |
Weighted average common shares outstanding: | ||
Basic | 51,585 | 50,767 |
Diluted | 53,518 | 52,633 |
Dividends per share | $ 0.0450 | $ 0.0425 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Cash flows from operating activities: | ||
Net income | $ 23,293 | $ 2,956 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 11,622 | 10,514 |
Amortization of deferred financing fees | 299 | 254 |
Amortization of deferred gain on sale-leaseback | (164) | 0 |
Impairment of long-lived assets | 155 | 111 |
Deferred income taxes | 14 | 61 |
Provision for doubtful accounts (Note 3) | 570 | 7,350 |
Share-based compensation | 2,309 | 2,224 |
Insurance proceeds received for damage to property | 167 | 0 |
Gain on insurance claims for damaged property and other assets | (667) | 0 |
Change in operating assets and liabilities | ||
Accounts receivable | 6,453 | (6,900) |
Prepaid income taxes | 6,654 | 252 |
Prepaid expenses and other assets | 2,162 | (2,790) |
Insurance subsidiary deposits and investments | 80 | 179 |
Charge related to class action lawsuit (Note 17) | 0 | 11,000 |
Liabilities related to operational closures (Note 6 and 16) | 0 | 3,906 |
Accounts payable | (6,815) | (4,044) |
Accrued wages and related liabilities | (6,490) | (9,410) |
Income taxes payable | 0 | 1,175 |
Other accrued liabilities | (647) | 938 |
Accrued self-insurance liabilities | 1,061 | 1,568 |
Deferred rent liability | 339 | 242 |
Net cash provided by operating activities | 40,395 | 19,586 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (11,082) | (11,997) |
Cash payments for business acquisitions (Note 7) | 0 | (8,693) |
Cash payments for asset acquisitions (Note 7) | (4,447) | (310) |
Escrow deposits | (10,025) | (2,394) |
Escrow deposits used to fund acquisitions | 228 | 1,582 |
Cash proceeds from the sale of assets and insurance proceeds | 64 | 608 |
Restricted and other assets | (201) | (193) |
Net cash used in investing activities | (25,463) | (21,397) |
Cash flows from financing activities: | ||
Proceeds from revolving credit facility and other debt (Note 14) | 195,000 | 345,000 |
Payments on revolving credit facility and other debt (Note 14) | (217,421) | (362,015) |
Issuance of common stock upon exercise of options | 2,920 | 957 |
Repurchase of common stock (Note 18) | 0 | (6,068) |
Dividends paid | (2,328) | (2,179) |
Non-controlling interest distribution | (292) | 0 |
Purchase of non-controlling interest | 0 | (83) |
Payments of deferred financing costs | (91) | 0 |
Net cash used in financing activities | (22,212) | (24,388) |
Net decrease in cash and cash equivalents | (7,280) | (26,199) |
Cash and cash equivalents beginning of period | 42,337 | 57,706 |
Cash and cash equivalents end of period | 35,057 | 31,507 |
Cash paid during the period for: | ||
Interest | 3,809 | 4,076 |
Income taxes | 0 | 8 |
Non-cash financing and investing activity: | ||
Accrued capital expenditures | 3,300 | 5,708 |
Note receivable from sale of ancillary business | $ 139 | $ 0 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2018 | |
DESCRIPTION OF BUSINESS [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | DESCRIPTION OF BUSINESS The Company - The Ensign Group, Inc. (collectively, Ensign or the Company), is a holding company with no direct operating assets, employees or revenue. The Company, through its operating subsidiaries, is a provider of health care services across the post-acute care continuum, as well as other ancillary businesses. As of March 31, 2018 , the Company operated 232 facilities, 46 home health, hospice and home care agencies and other ancillary operations located in Arizona, California, Colorado, Idaho, Iowa, Kansas, Nebraska, Nevada, Oklahoma, Oregon, South Carolina, Texas, Utah, Washington and Wisconsin. The Company's operating subsidiaries, each of which strives to be the operation of choice in the community it serves, provide a broad spectrum of skilled nursing, assisted living, home health, home care, hospice and other ancillary services. The Company's operating subsidiaries have a collective capacity of approximately 18,900 operational skilled nursing beds and 5,100 assisted living and independent living units. As of March 31, 2018 , the Company owned 65 of its 232 affiliated facilities and leased an additional 167 facilities through long-term lease arrangements and had options to purchase eleven of those 167 facilities. As of December 31, 2017 , the Company owned 63 of its 230 affiliated facilities and leased an additional 167 facilities through long-term lease arrangements and had options to purchase eleven of those 167 facilities. Certain of the Company’s wholly-owned independent subsidiaries, collectively referred to as the Service Center, provide certain accounting, payroll, human resources, information technology, legal, risk management and other centralized services to the other operating subsidiaries through contractual relationships with such subsidiaries. The Company also has a wholly-owned captive insurance subsidiary (the Captive) that provides some claims-made coverage to the Company’s operating subsidiaries for general and professional liability, as well as coverage for certain workers’ compensation insurance liabilities. Each of the Company's affiliated operations are operated by separate, wholly-owned, independent subsidiaries that have their own management, employees and assets. References herein to the consolidated “Company” and “its” assets and activities in this quarterly report is not meant to imply, nor should it be construed as meaning, that The Ensign Group, Inc. has direct operating assets, employees or revenue, or that any of the subsidiaries, are operated by The Ensign Group, Inc. Other Information — The accompanying condensed consolidated financial statements as of March 31, 2018 and for the three months ended March 31, 2018 and 2017 (collectively, the Interim Financial Statements) are unaudited. Certain information and note disclosures normally included in annual consolidated financial statements have been condensed or omitted, as permitted under applicable rules and regulations. Readers of the Interim Financial Statements should refer to the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2017 which are included in the Company’s annual report on Form 10-K, File No. 001-33757 (the Annual Report) filed with the Securities and Exchange Commission (SEC). Management believes that the Interim Financial Statements reflect all adjustments which are of a normal and recurring nature necessary to present fairly the Company’s financial position and results of operations in all material respects. The results of operations presented in the Interim Financial Statements are not necessarily representative of operations for the entire year. |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies [Text Block] | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation — The accompanying Interim Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP). The Company is the sole member or shareholder of various consolidated limited liability companies and corporations established to operate various acquired skilled nursing and assisted living operations, home health, hospice and home care operations, and related ancillary services. All intercompany transactions and balances have been eliminated in consolidation. The condensed consolidated financial statements include the accounts of all entities controlled by the Company through its ownership of a majority voting interest. The Company presents noncontrolling interest within the equity section of its condensed consolidated balance sheets. The Company presents the amount of consolidated net income that is attributable to The Ensign Group, Inc. and the noncontrolling interest in its condensed consolidated statements of income. Estimates and Assumptions — The preparation of Interim Financial Statements in conformity with 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 Interim Financial Statements and the reported amounts of revenue and expenses during the reporting periods. The most significant estimates in the Company’s Interim Financial Statements relate to revenue, intangible assets and goodwill, impairment of long-lived assets, general and professional liability, workers' compensation and healthcare claims included in accrued self-insurance liabilities, and income taxes. Actual results could differ from those estimates. Fair Value of Financial Instruments — The Company’s financial instruments consist principally of cash and cash equivalents, debt security investments, accounts receivable, insurance subsidiary deposits, accounts payable and borrowings. The Company believes all of the financial instruments’ recorded values approximate fair values because of their nature or respective short durations. Revenue Recognition — On January 1, 2018, the Company adopted Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (ASC 606) applying the modified retrospective method. Results for reporting periods beginning January 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported under the accounting standards in effect for the prior period. The adoption of ASC 606 did not have a material impact on the measurement nor on the recognition of revenue of contracts, for which all revenue had not been recognized, as of January 1, 2018, therefore no cumulative adjustment has been made to the opening balance of retained earnings at the beginning of 2018. See Note 3, Revenue and Accounts Receivable . Accounts Receivable and Allowance for Doubtful Accounts — Accounts receivable consist primarily of amounts due from Medicare and Medicaid programs, other government programs, managed care health plans and private payor sources, net of estimates for variable consideration. The allowance for doubtful accounts reflects the Company’s best estimate of probable losses inherent in the accounts receivable balance. The Company determines the allowance based on known troubled accounts and other currently available evidence. See Note 3, Revenue and Accounts Receivable . Property and Equipment — Property and equipment are initially recorded at their historical cost. Repairs and maintenance are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the depreciable assets (ranging from three to 59 years ). Leasehold improvements are amortized on a straight-line basis over the shorter of their estimated useful lives or the remaining lease term. Impairment of Long-Lived Assets — The Company reviews the carrying value of long-lived assets that are held and used in the Company’s operating subsidiaries for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of these assets is determined based upon expected undiscounted future net cash flows from the operating subsidiaries to which the assets relate, utilizing management’s best estimate, appropriate assumptions, and projections at the time. If the carrying value is determined to be unrecoverable from future operating cash flows, the asset is deemed impaired and an impairment loss would be recognized to the extent the carrying value exceeded the estimated fair value of the asset. The Company estimates the fair value of assets based on the estimated future discounted cash flows of the asset. Management has evaluated its long-lived assets and recorded an impairment charge of $155 and $111 during the three months ended March 31, 2018 and 2017 , respectively. Leases and Leasehold Improvements - At the inception of each lease, the Company performs an evaluation to determine whether the lease should be classified as an operating or capital lease. The Company records rent expense for operating leases that contain scheduled rent increases on a straight-line basis over the term of the lease. The lease term used for straight-line rent expense is calculated from the date the Company is given control of the leased premises through the end of the lease term. The lease term used for this evaluation also provides the basis for establishing depreciable lives for buildings subject to lease and leasehold improvements, as well as the period over which the Company records straight-line rent expense. Intangible Assets and Goodwill — Definite-lived intangible assets consist primarily of favorable leases, lease acquisition costs, patient base, facility trade names and customer relationships. Favorable leases and lease acquisition costs are amortized over the life of the lease of the facility. Patient base is amortized over a period of four to eight months, depending on the classification of the patients and the level of occupancy in a new acquisition on the acquisition date. Trade names at affiliated facilities are amortized over 30 years and customer relationships are amortized over a period of up to 20 years . The Company's indefinite-lived intangible assets consist of trade names and Medicare and Medicaid licenses. The Company tests indefinite-lived intangible assets for impairment on an annual basis or more frequently if events or changes in circumstances indicate that the carrying amount of the intangible asset may not be recoverable. The Company did not identify any intangible asset or goodwill impairment during the three months ended March 31, 2018 and 2017 . Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations. Goodwill is subject to annual testing for impairment. In addition, goodwill is tested for impairment if events occur or circumstances change that would reduce the fair value of a reporting unit below its carrying amount. The Company performs its annual test for impairment during the fourth quarter of each year. See further discussion at Note 10, Goodwill and Other Indefinite-Lived Intangible Assets . Self-Insurance — The Company is partially self-insured for general and professional liability up to a base amount per claim (the self-insured retention) with an aggregate, one-time deductible above this limit. Losses beyond these amounts are insured through third-party policies with coverage limits per claim, per location and on an aggregate basis for the Company. The combined self-insured retention is $500 per claim, subject to an additional one-time deductible of $750 for California affiliated operations and a separate, one-time, deductible of $1,000 for non-California operations. For all affiliated operations, except those located in Colorado, the third-party coverage above these limits is $1,000 per claim, $3,000 per operation, with a $5,000 blanket aggregate limit and an additional state-specific aggregate where required by state law. In Colorado, the third-party coverage above these limits is $1,000 per claim and $3,000 per operation, which is independent of the aforementioned blanket aggregate limits that apply outside of Colorado. The self-insured retention and deductible limits for general and professional liability and workers' compensation for all states (except Texas and Washington for workers' compensation) are self-insured through the Captive, the related assets and liabilities of which are included in the accompanying condensed consolidated balance sheets. The Captive is subject to certain statutory requirements as an insurance provider. These requirements include, but are not limited to, maintaining statutory capital. The Company’s policy is to accrue amounts equal to the actuarially estimated costs to settle open claims of insureds, as well as an estimate of the cost of insured claims that have been incurred but not reported. The Company develops information about the size of the ultimate claims based on historical experience, current industry information and actuarial analysis, and evaluates the estimates for claim loss exposure on a quarterly basis. Accrued general liability and professional malpractice liabilities on an undiscounted basis, net of anticipated insurance recoveries, were $39,982 and $38,998 as of March 31, 2018 and December 31, 2017 , respectively. The Company’s operating subsidiaries are self-insured for workers’ compensation in California. To protect itself against loss exposure in California with this policy, the Company has purchased individual specific excess insurance coverage that insures individual claims that exceed $500 per occurrence. In Texas, the operating subsidiaries have elected non-subscriber status for workers’ compensation claims and the Company has purchased individual stop-loss coverage that insures individual claims that exceed $750 per occurrence. The Company’s operating subsidiaries in all other states, with the exception of Washington, are under a loss sensitive plan that insures individual claims that exceed $350 per occurrence. In Washington, the operating subsidiaries' coverage is financed through premiums paid by the employers and employees. The claims and pay benefits are managed through a state insurance pool. Outside of California, Texas and Washington, the Company has purchased insurance coverage that insures individual claims that exceed $350 per accident. In all states except Washington, the Company accrues amounts equal to the estimated costs to settle open claims, as well as an estimate of the cost of claims that have been incurred but not reported. The Company uses actuarial valuations to estimate the liability based on historical experience and industry information. Accrued workers’ compensation liabilities are recorded on an undiscounted basis in the accompanying condensed consolidated balance sheets and were $24,094 and $23,621 as of March 31, 2018 and December 31, 2017 , respectively. In addition, the Company has recorded an asset and equal liability of $5,278 and $5,394 at March 31, 2018 and December 31, 2017 , respectively, in order to present the ultimate costs of malpractice and workers' compensation claims and the anticipated insurance recoveries on a gross basis. See Note 11 Restricted and Other Assets. The Company self-funds medical (including prescription drugs) and dental healthcare benefits to the majority of its employees. The Company is fully liable for all financial and legal aspects of these benefit plans. To protect itself against loss exposure with this policy, the Company has purchased individual stop-loss insurance coverage that insures individual claims that exceed $300 for each covered person with an additional one-time aggregate individual stop loss deductible of $75 . Beginning 2016, the Company's policy does not include the additional one-time aggregate individual stop loss deductible of $75 . The Company’s accrued liability under these plans recorded on an undiscounted basis in the accompanying condensed consolidated balance sheets was $4,327 and $4,723 as of March 31, 2018 and December 31, 2017 , respectively. The Company believes that adequate provision has been made in the Interim Financial Statements for liabilities that may arise out of patient care, workers’ compensation, healthcare benefits and related services provided to date. The amount of the Company’s reserves was determined based on an estimation process that uses information obtained from both company-specific and industry data. This estimation process requires the Company to continuously monitor and evaluate the life cycle of the claims. Using data obtained from this monitoring and the Company’s assumptions about emerging trends, the Company, with the assistance of an independent actuary, develops information about the size of ultimate claims based on the Company’s historical experience and other available industry information. The most significant assumptions used in the estimation process include determining the trend in costs, the expected cost of claims incurred but not reported and the expected costs to settle or pay damage awards with respect to unpaid claims. The self-insured liabilities are based upon estimates, and while management believes that the estimates of loss are reasonable, the ultimate liability may be in excess of or less than the recorded amounts. Due to the inherent volatility of actuarially determined loss estimates, it is reasonably possible that the Company could experience changes in estimated losses that could be material to net income. If the Company’s actual liability exceeds its estimates of loss, its future earnings, cash flows and financial condition would be adversely affected. Income Taxes — Deferred tax assets and liabilities are established for temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities at tax rates in effect when such temporary differences are expected to reverse. The Company generally expects to fully utilize its deferred tax assets; however, when necessary, the Company records a valuation allowance to reduce its net deferred tax assets to the amount that is more likely than not to be realized. In determining the need for a valuation allowance or the need for and magnitude of liabilities for uncertain tax positions, the Company makes certain estimates and assumptions. These estimates and assumptions are based on, among other things, knowledge of operations, markets, historical trends and likely future changes and, when appropriate, the opinions of advisors with knowledge and expertise in certain fields. Due to certain risks associated with the Company’s estimates and assumptions, actual results could differ. The Tax Cuts and Jobs Act (the Tax Act), which was enacted in December 2017, decreased the corporate income tax rate from 35.0% to 21.0% beginning on January 1, 2018. The Company’s actual effective tax rate for fiscal 2018 may differ from management’s estimate due to changes in interpretations and assumptions, and the excess tax benefits impact of share-based payment awards. See Note 13, Income Taxes for further detail. Noncontrolling Interest — The noncontrolling interest in a subsidiary is initially recognized at estimated fair value on the acquisition date and is presented within total equity in the Company's consolidated balance sheets. The Company presents the noncontrolling interest and the amount of consolidated net income attributable to The Ensign Group, Inc. in its condensed consolidated statements of income and net income per share is calculated based on net income attributable to The Ensign Group, Inc.'s stockholders. The carrying amount of the noncontrolling interest is adjusted based on an allocation of subsidiary earnings based on ownership interest. Share-Based Compensation — The Company measures and recognizes compensation expense for all share-based payment awards made to employees and directors including employee stock options based on estimated fair values, ratably over the requisite service period of the award. Net income has been reduced as a result of the recognition of the fair value of all stock options and restricted stock awards issued, the amount of which is contingent upon the number of future grants and other variables. Recent Accounting Pronouncements — Except for rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws and a limited number of grandfathered standards, the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) is the sole source of authoritative GAAP literature recognized by the FASB and applicable to the Company. For any new pronouncements announced, the Company considers whether the new pronouncements could alter previous generally accepted accounting principles and determines whether any new or modified principles will have a material impact on the Company's reported financial position or operations in the near term. The applicability of any standard is subject to the formal review of the Company's financial management and certain standards are under consideration. Recent Accounting Standards Adopted by the Company In 2014, the FASB and International Accounting Standards Board issued their final standard on revenue from contracts with customers that outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. Under this new standard and subsequently issued amendments, revenue is recognized at the time a good or service is transferred to a customer for the amount of consideration received. Entities may apply the new standard either retrospectively to each period presented (full retrospective method) or retrospectively with the cumulative effect recognized in beginning retained earnings as of the date of adoption (modified retrospective method). The Company adopted the new revenue standard as of January 1, 2018 using the modified retrospective transition method. The adoption of ASC 606 did not have a material impact on the measurement nor on the recognition of revenue of contracts for which all revenue had not been recognized as of January 1, 2018, therefore no cumulative adjustment has been made to the opening balance of retained earnings at the beginning of 2018. The comparative information has not been restated and continues to be reported under the accounting standards in effect for the period presented. In May 2017, the FASB issued amended authoritative guidance to provide guidance on types of changes to the terms or conditions of share-based payments awards to which an entity would be required to apply modification accounting under ASC 718. The new guidance was effective for the Company in the first quarter of fiscal year 2018. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. In January 2017, the FASB issued amended authoritative guidance to clarify the definition of a business and reduce diversity in practice related to the evaluation of whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The new provisions provide the requirements needed for an integrated set of assets and activities (the set) to be a business and also establish a practical way to determine when a set is not a business. The accounting standards update (ASU) provides a screen to determine when an integrated set of assets and activities is not a business. The more robust framework helps entities to narrow the definition of outputs created by the set and align it with how outputs are described in the new revenue standard. The new guidance was effective for the Company in the first quarter of fiscal year 2018. The Company's acquisitions during the three months ended March 31, 2018 were classified as asset acquisitions as the fair value of assets acquired is concentrated in a single asset. These acquisitions would have been classified as business combination prior to the adoption of the ASU. The Company anticipates that future acquisitions will be classified as a mixture of business and asset acquisitions under the new guidance. In March 2018, we adopted FASB ASU 2018-05, Income Taxes (topic 740): Amendments to the SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118, which updates the income tax accounting in U.S. GAAP to reflect the securities and Exchange Commission (‘SEC’) interpretive guidance released in December 2017, when the Tax Cuts and Jobs Act (the ‘Tax Act’) was signed into law. Additional information regarding the adoption of this standard is contained in Note 13, Income Taxes. In October 2016, the FASB issued amended authoritative guidance to require companies to recognize the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. The new guidance is required to be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The new guidance was effective for the Company in the first quarter of fiscal year 2018. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. In August 2016, the FASB issued amended authoritative guidance to reduce the diversity in practice related to the presentation and classification of certain cash receipts and cash payments in the statement of cash flows. The new provisions target cash flow issues related to (i) debt prepayment or debt extinguishment costs, (ii) settlement of debt instruments with coupon rates that are insignificant relative to effective interest rates, (iii) contingent consideration payments made after a business combination, (iv) proceeds from settlement of insurance claims, (v) proceeds from the settlement of corporate-owned life insurance and bank-owned life insurance policies, (vi) distributions received from equity method investees, (vii) beneficial interests in securitization transactions and (viii) separately identifiable cash flows and application of the predominance principle. The new guidance was effective for the Company in the first quarter of fiscal year 2018. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. Accounting Standards Recently Issued But Not Yet Adopted by the Company In January 2017, the FASB issued amended authoritative guidance to simplify and reduce the cost and complexity of the goodwill impairment test. The new provisions eliminate step 2 from the goodwill impairment test and shifts the concept of impairment from a measure of loss when comparing the implied fair value of goodwill to its carrying amount to comparing the fair value of a reporting unit with its carrying amount. The FASB also eliminated the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment or step 2 of the goodwill impairment test. The new guidance does not amend the optional qualitative assessment of goodwill impairment. This guidance is effective for annual periods beginning after December 15, 2019, which will be the Company's fiscal year 2020, with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company's consolidated financial statements. In February 2016, the FASB issued amended authoritative guidance on accounting for leases. The new provisions require that a lessee of operating leases recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. The lease liability will be equal to the present value of lease payments, with the right-of-use asset based upon the lease liability. The classification criteria for distinguishing between finance (or capital) leases and operating leases are substantially similar to the previous lease guidance, but with no explicit bright lines. As such, operating leases will result in straight-line rent expense similar to current practice. For short term leases (term of 12 months or less), a lessee is permitted to make an accounting election not to recognize lease assets and lease liabilities, which would generally result in lease expense being recognized on a straight-line basis over the lease term. This guidance applies to all entities and is effective for annual periods beginning after December 15, 2018, which will be the Company's fiscal year 2019, with early adoption permitted. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements but expects this adoption will result in a significant increase in the assets and liabilities on its consolidated balance sheets. |
Revenue and Accounts Receivable
Revenue and Accounts Receivable | 3 Months Ended |
Mar. 31, 2018 | |
REVENUE AND ACCOUNTS RECEIVABLE [Abstract] | |
Revenue and Accounts receivable [Text Block] | REVENUE AND ACCOUNTS RECEIVABLE The Company's revenue is derived primarily from providing healthcare services to its patients. Revenues are recognized when services are provided to the patients at the amount that reflects the consideration to which the Company expects to be entitled from patients and third-party payors, including Medicaid, Medicare and insurers (private and Medicare replacement plans), in exchange for providing patient care. The healthcare services in transitional and skilled, home health and hospice patient contracts include routine services in exchange for a contractual agreed-upon amount or rate. Routine services are treated as a single performance obligation satisfied over time as services are rendered. As such, patient care services represent a bundle of services that are not capable of being distinct. Additionally, there may be ancillary services which are not included in the daily rates for routine services, but instead are treated as separate performance obligations satisfied at a point in time, if and when, those services are rendered. Revenue recognized from healthcare services are adjusted for estimates of variable consideration to arrive at the transaction price. The Company determines the transaction price based on contractually agreed-upon amounts or rate, adjusted for estimates of variable consideration. The Company uses the expected value method in determining the variable component that should be used to arrive at the transaction price, using contractual agreements and historical reimbursement experience within each payor type. The amount of variable consideration which is included in the transaction price may be constrained, and is included in the net revenue only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. If actual amounts of consideration ultimately received differ from the Company’s estimates, the Company adjusts these estimates, which would affect net service revenue in the period such variances become known. Revenue from the Medicare and Medicaid programs accounted for 67.9% and 68.2% of the Company's revenue for the three months ended March 31, 2018 and 2017 , respectively. Settlement with Medicare and Medicaid payors for retroactive adjustments due to audits and reviews are considered variable consideration and are included in the determination of the estimated transaction price. These settlements are estimated based on the terms of the payment agreement with the payor, correspondence from the payor and the Company’s historical settlement activity. Consistent with healthcare industry practices, any changes to these revenue estimates are recorded in the period the change or adjustment becomes known based on final settlement. The Company recorded adjustments to revenue which were not material to the Company's consolidated revenue or Interim Financial Statements for the three months ended March 31, 2018 and 2017. Disaggregation of Revenue The Company disaggregates revenue from contracts with its patients by reportable operating segments and payors. The Company determines that disaggregating revenue into these categories achieves the disclosure objectives to depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. A reconciliation of disaggregated revenue to segment revenue as well as revenue by payor is provided in Note 6, Business Segments . The Company’s service specific revenue recognition policies are as follows: Transitional and Skilled Nursing Revenue The Company’s revenue is derived primarily from providing long-term healthcare services to patients and is recognized on the date services are provided at amounts billable to individual patients, adjusted for estimates for variable consideration. For patients under reimbursement arrangements with third-party payors, including Medicaid, Medicare and private insurers, revenue is recorded based on contractually agreed-upon amounts or rate, adjusted for estimates for variable consideration, on a per patient, daily basis or as services are performed. Assisted and Independent Living Revenue The Company's assisted and independent living revenue consists of fees for basic housing and assisted living care. Accordingly, we record revenue when services are rendered on the date services are provided at amounts billable to individual residents. Residency agreements are generally for a term of 30 days, with resident fees billed monthly in advance. For patients under reimbursement arrangements with Medicaid, revenue is recorded based on contractually agreed-upon amounts or rates on a per resident, daily basis or as services are rendered. Home Health Revenue Medicare Revenue Net service revenue is recorded under the Medicare prospective payment system based on a 60-day episode payment rate that is subject to adjustment based on certain variables including, but not limited to: (a) an outlier payment if patient care was unusually costly; (b) a low utilization payment adjustment if the number of visits was fewer than five; (c) a partial payment if the patient transferred to another provider or the Company received a patient from another provider before completing the episode; (d) a payment adjustment based upon the level of therapy services required; (e) the number of episodes of care provided to a patient, regardless of whether the same home health provider provided care for the entire series of episodes; (f) changes in the base episode payments established by the Medicare program; (g) adjustments to the base episode payments for case mix and geographic wages; and (h) recoveries of overpayments. The Company makes adjustments to Medicare revenue on completed episodes to reflect differences between estimated and actual payment amounts, an inability to obtain appropriate billing documentation or authorizations acceptable to the payor and other reasons unrelated to credit risk. Revenue is also adjusted for estimates for variable consideration. Therefore, the Company believes that its reported net service revenue and patient accounts receivable will be the net amounts to be realized from Medicare for services rendered. In addition to revenue recognized on completed episodes, the Company also recognizes a portion of revenue associated with episodes in progress. Episodes in progress are 60-day episodes of care that begin during the reporting period, but were not completed as of the end of the period. As such, the Company estimates revenue and recognizes it on a daily basis. The primary factors underlying this estimate are the number of episodes in progress at the end of the reporting period, expected Medicare revenue per episode and its estimate of the average percentage complete based on visits performed. Non-Medicare Revenue Episodic Based Revenue - The Company recognizes revenue in a similar manner as it recognizes Medicare revenue for episodic-based rates that are paid by other insurance carriers, including Medicare Advantage programs; however, these rates can vary based upon the negotiated terms. Non-episodic Based Revenue - Revenue is recorded on an accrual basis based upon the date of service at amounts equal to its established or estimated per-visit rates, and adjusted for estimates for variable consideration, as applicable. Hospice Revenue Revenue is recorded on an accrual basis based upon the date of service at amounts equal to the estimated payment rates, net of estimates for variable consideration. The estimated payment rates are daily rates for each of the levels of care the Company delivers. The Company makes adjustments to revenue for an inability to obtain appropriate billing documentation or authorizations acceptable to the payor and other reasons, including credit risk. Additionally, as Medicare hospice revenue is subject to an inpatient cap limit and an overall payment cap, the Company monitors its provider numbers and estimates amounts due back to Medicare if a cap has been exceeded. The Company records these adjustments as a reduction to revenue and increases to other accrued liabilities. Impact of New Revenue Guidance on Financial Statement Line Items The following tables summarize the impacts of adopting ASC 606 on the Company’s condensed consolidated statements of income for the three months ended March 31, 2018. There was no impact to the condensed consolidated balance sheet as of March 31, 2018 or condensed consolidated statements of cash flows for the three months ended March 31, 2018, as such, no pro forma information is provided. Three Months Ended March 31, 2018 2017 Total revenue As Reported $ 492,134 $ 441,739 Adjustments 8,804 — Pro forma as if the previous accounting guidance was in effect $ 500,938 $ 441,739 Cost of Services: As Reported $ 390,243 $ 355,486 Adjustments 8,804 — Pro forma as if the previous accounting guidance was in effect $ 399,047 $ 355,486 Total Expense: As Reported $ 459,155 $ 434,187 Adjustments 8,804 — Pro forma as if the previous accounting guidance was in effect $ 467,959 $ 434,187 The majority of what was previously presented as bad debt expense under operating expenses has been incorporated as an implicit price concession factored into the calculation of net revenues, as shown in the "Adjustments" line in the table above. Subsequent material events that alter the payor's ability to pay are recorded as bad debt expense. The Company's bad debt expense and bad debt as a percent of total revenue for the three months ended March 31, 2018 and 2017 was $570 and 0.1% , and $7,350 and 1.7% , respectively. Prior period results reflect reclassifications, for comparative purposes, related to the adoption of ASC 606, for the presentation of the Company’s assisted and independent living revenues. Historically, the Company only presented total revenue for all revenue services. This reclassification had no effect on the reported results of operations. Revenue for the three months ended March 31, 2018 and 2017 is summarized in the following tables: Three Months Ended March 31, 2018 2018 Pro Forma (2) 2017 Revenue % of Revenue Revenue % of Revenue Revenue % of Revenue Medicaid $ 167,625 34.1 % $ 170,309 34.0 % $ 148,271 33.6 % Medicare 139,314 28.3 140,381 28.0 129,920 29.4 Medicaid — skilled 27,042 5.5 27,538 5.5 23,017 5.2 Total Medicaid and Medicare 333,981 67.9 338,228 67.5 301,208 68.2 Managed care 83,716 17.0 85,845 17.1 75,562 17.1 Private and other payors (1) 74,437 15.1 76,865 15.4 64,969 14.7 Revenue $ 492,134 100.0 % $ 500,938 100.0 % $ 441,739 100.0 % (1) Private and other payors also includes revenue from all payors generated in other ancillary services for the three months ended March 31, 2018 and 2017. (2) The 2018 pro forma results reflect balances assuming previous accounting guidance was still in effect. Balance Sheet Impact Included in the Company’s condensed consolidated balance sheet are contract assets, comprised of billed accounts receivable and unbilled receivables which are the result of the timing of revenue recognition, billings and cash collections, as well as, contract liabilities, which primarily represent payments the Company receives in advance of services provided. The Company had no material contract liabilities or activity as of and for the three months ended March 31, 2018 related to its transitional and skilled services, and home health and hospice services segments. Accounts receivable as of March 31, 2018 and December 31, 2017 is summarized in the following table: March 31, December 31, 2018 2018 Pro Forma (1) 2017 Medicaid $ 99,799 $ 112,419 $ 119,441 Managed care 59,358 71,955 68,930 Medicare 49,765 55,361 55,667 Private and other payors 51,349 64,983 64,991 260,271 304,718 309,029 Less: allowance for doubtful accounts (1,762 ) (46,209 ) (43,961 ) Accounts receivable, net $ 258,509 $ 258,509 $ 265,068 (1) The 2018 pro forma results reflect balances assuming previous accounting guidance was still in effect. Practical Expedients and Exemptions As the Company’s contracts with its patients have an original duration of one year or less, the Company uses the practical expedient applicable to its contracts and does not consider the time value of money. Further, because of the short duration of these contracts, the Company has not disclosed the transaction price for the remaining performance obligations as of the end of each reporting period or when the Company expects to recognize this revenue. In addition, the Company has applied the practical expedient provided by ASC 340, Other Assets and Deferred Costs , and all incremental customer contract acquisition costs are expensed as they are incurred because the amortization period would have been one year or less. |
Computation of Net Income Per C
Computation of Net Income Per Common Share | 3 Months Ended |
Mar. 31, 2018 | |
COMPUTATION OF NET INCOME PER COMMON SHARE [Abstract] | |
Earnings Per Share [Text Block] | COMPUTATION OF NET INCOME PER COMMON SHARE Basic net income per share is computed by dividing income from continuing operations attributable to The Ensign Group, Inc. stockholders by the weighted average number of outstanding common shares for the period. The computation of diluted net income per share is similar to the computation of basic net income per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued. A reconciliation of the numerator and denominator used in the calculation of basic net income per common share follows: Three Months Ended March 31, 2018 2017 Numerator: Net income $ 23,293 $ 2,956 Less: net income attributable to noncontrolling interests 161 116 Net income attributable to The Ensign Group, Inc. $ 23,132 $ 2,840 Denominator: Weighted average shares outstanding for basic net income per share 51,585 50,767 Basic net income per common share attributable to The Ensign Group, Inc. $ 0.45 $ 0.06 A reconciliation of the numerator and denominator used in the calculation of diluted net income per common share follows: Three Months Ended March 31, 2018 2017 Numerator: Net income $ 23,293 $ 2,956 Less: net income attributable to noncontrolling interests 161 116 Net income attributable to The Ensign Group, Inc. $ 23,132 $ 2,840 Denominator: Weighted average common shares outstanding 51,585 50,767 Plus: incremental shares from assumed conversion (1) 1,933 1,866 Adjusted weighted average common shares outstanding 53,518 52,633 Diluted net income per common share attributable to The Ensign Group, Inc. $ 0.43 $ 0.05 (1) Options outstanding which are anti-dilutive and therefore not factored into the weighted average common shares amount above were 937 and 1,272 for the three months ended March 31, 2018 and 2017 , respectively. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | FAIR VALUE MEASUREMENTS Fair value measurements are based on a three-tier hierarchy that prioritizes the inputs used to measure fair value. These tiers include: Level 1, defined as observable inputs such as quoted market prices in active markets; Level 2, defined as inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. The following table summarizes the financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017 : March 31, 2018 December 31, 2017 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Cash and cash equivalents $ 35,057 $ — $ — $ 42,337 $ — $ — The Company's non-financial assets, which include long-lived assets, including goodwill, intangible assets and property and equipment, are not required to be measured at fair value on a recurring basis. However, on a periodic basis, or whenever events or changes in circumstances indicate that their carrying value may not be recoverable, the Company assesses its long-lived assets for impairment. When impairment has occurred, such long-lived assets are written down to fair value. See Note 2, Summary of Significant Accounting Policies for further discussion of the Company's significant accounting policies. Debt Security Investments - Held to Maturity At March 31, 2018 and December 31, 2017 , the Company had approximately $41,696 and $41,777 , respectively, in debt security investments which were classified as held to maturity and carried at amortized cost. The carrying value of the debt securities approximates fair value based on Level 1. The Company has the intent and ability to hold these debt securities to maturity. Further, as of March 31, 2018 , the debt security investments were held in AA, A and BBB+ rated debt securities. |
Business Segments
Business Segments | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | BUSINESS SEGMENTS The Company has three reportable operating segments: (1) transitional and skilled services, which includes the operation of skilled nursing facilities; (2) assisted and independent living services, which includes the operation of assisted and independent living facilities; and (3) home health and hospice services, which includes the Company's home health, home care and hospice businesses. The Company's Chief Executive Officer, who is its chief operating decision maker, or CODM, reviews financial information at the operating segment level. The Company also reports an “all other” category that includes results from its mobile diagnostics and other ancillary operations for the three months ended March 31, 2018 and 2017 . These operations are neither significant individually nor in aggregate and therefore do not constitute a reportable segment. The reporting segments are business units that offer different services and are managed separately to provide greater visibility into those operations. As of March 31, 2018 , transitional and skilled services included 160 wholly-owned affiliated skilled nursing facilities and 21 campuses that provide skilled nursing and rehabilitative care services and assisted and independent living services. The Company provided room and board and social services through 51 wholly-owned affiliated assisted and independent living facilities and 21 campuses as mentioned above. Home health, home care and hospice services were provided to patients through 46 affiliated agencies. As of March 31, 2018 , the Company held majority membership interests in other ancillary operations, which operating results are included in the "all other" category. The Company evaluates performance and allocates capital resources to each segment based on an operating model that is designed to maximize the quality of care provided and profitability. General and administrative expenses are not allocated to any segment for purposes of determining segment profit or loss, and are included in the "all other" category in the selected segment financial data that follows. The accounting policies of the reporting segments are the same as those described in Note 2 , Summary of Significant Accounting Policies. The Company's CODM does not review assets by segment in his resource allocation and therefore assets by segment are not disclosed below. Segment revenues by major payor source were as follows: Three Months Ended March 31, 2018 Transitional and Skilled Services Assisted and Independent Living Services Home Health and Hospice Services All Other Total Revenue Revenue % Medicaid $ 156,511 $ 8,264 $ 2,850 $ — $ 167,625 34.1 % Medicare 111,953 — 27,361 — 139,314 28.3 Medicaid-skilled 27,042 — — — 27,042 5.5 Subtotal 295,506 8,264 30,211 — 333,981 67.9 Managed care 77,800 — 5,916 — 83,716 17.0 Private and other 33,710 27,849 3,631 9,247 (1) 74,437 15.1 Total revenue $ 407,016 $ 36,113 $ 39,758 $ 9,247 $ 492,134 100.0 % (1) Private and other payors also includes revenue from all payors generated in other ancillary services for the three months ended March 31, 2018. Three Months Ended March 31, 2017 Transitional and Skilled Services Assisted and Independent Living Services Home Health and Hospice Services All Other Total Revenue Revenue % Medicaid $ 138,825 $ 7,036 $ 2,410 $ — $ 148,271 33.6 % Medicare 107,928 — 21,992 — 129,920 29.4 Medicaid-skilled 23,017 — — — 23,017 5.2 Subtotal 269,770 7,036 24,402 — 301,208 68.2 Managed care 70,357 — 5,205 — 75,562 17.1 Private and other 32,212 25,310 2,526 4,921 (1) 64,969 14.7 Total revenue $ 372,339 $ 32,346 $ 32,133 $ 4,921 $ 441,739 100.0 % (1) Private and other payors also includes revenue from all payors generated in other ancillary services for the three months ended March 31, 2017. The following pro forma table demonstrates the impact of adopting ASC 606 on the Company's segment revenues by major payor source for the three months ended March 31, 2018 , by showing revenue amounts as if the previous accounting guidance was still in effect. Three Months Ended March 31, 2018 (Pro forma) Transitional and Skilled Services Assisted and Independent Living Services (2) Home Health and Hospice Services All Other Total Revenue Revenue % Medicaid $ 159,104 $ 8,264 $ 2,941 $ — $ 170,309 34.0 % Medicare 112,777 — 27,604 — 140,381 28.0 Medicaid-skilled 27,538 — — — 27,538 5.5 Subtotal 299,419 8,264 30,545 — 338,228 67.5 Managed care 79,698 — 6,147 — 85,845 17.1 Private and other 36,104 27,849 3,665 9,247 (1) 76,865 15.4 Total revenue $ 415,221 $ 36,113 $ 40,357 $ 9,247 $ 500,938 100.0 % (1) Private and other payors also includes revenue from all payors generated in other ancillary services for the three months ended March 31, 2018. The following table sets forth selected financial data consolidated by business segment: Three Months Ended March 31, 2018 Transitional and Skilled Services (3) Assisted and Independent Living Services (3) Home Health and Hospice Services All Other Elimination Total Service revenue $ 407,016 $ — $ 39,758 $ 9,247 $ — $ 456,021 Assisted and independent living revenue — 36,113 — — — 36,113 Revenue from external customers $ 407,016 $ 36,113 $ 39,758 $ 9,247 $ — $ 492,134 Intersegment revenue (1) 689 — — 1,082 (1,771 ) — Total revenue $ 407,705 $ 36,113 $ 39,758 $ 10,329 $ (1,771 ) $ 492,134 Segment income (loss) (2) $ 46,195 $ 4,662 $ 6,058 $ (23,936 ) $ — $ 32,979 Interest expense, net of interest income $ (3,165 ) Income before provision for income taxes $ 29,814 Depreciation and amortization $ 7,802 $ 1,597 $ 245 $ 1,978 $ — $ 11,622 (1) Intersegment revenue represents services provided at the Company's operating subsidiaries to the Company's other business lines. (2) Segment income (loss) includes depreciation and amortization expense and excludes general and administrative expense and interest expense for transitional and skilled services, assisted and independent living services and home health and hospice services segments. General and administrative expense, including the return of unclaimed class action settlement for the three months ended March 31, 2018, is included in the "All Other" category. (3) The Company's campuses represent facilities that offer skilled nursing, assisted and/or independent living services. Revenue and expenses related to skilled nursing, assisted and independent living services have been allocated and recorded in the respective reportable segment. Due to the adoption of ASC 606, the presentation of revenue changed from presenting total revenue to service revenue and assisted and independent living revenue. Three Months Ended March 31, 2017 Transitional and Skilled Services (3) Assisted and Independent Living Services (3) Home Health and Hospice Services All Other Elimination Total Service revenue $ 372,339 $ — $ 32,133 $ 4,921 $ — $ 409,393 Assisted and independent living revenue — $ 32,346 $ — $ — — 32,346 Revenue from external customers $ 372,339 $ 32,346 $ 32,133 $ 4,921 $ — $ 441,739 Intersegment revenue (1) 744 — — 884 (1,628 ) — Total revenue $ 373,083 $ 32,346 $ 32,133 $ 5,805 $ (1,628 ) $ 441,739 Segment income (loss) (2) $ 31,790 $ 4,439 $ 4,294 $ (32,971 ) $ — $ 7,552 Interest expense, net of interest income $ (3,155 ) Income before provision for income taxes $ 4,397 Depreciation and amortization $ 6,953 $ 1,623 $ 235 $ 1,703 $ — $ 10,514 (1) Intersegment revenue represents services provided at the Company's operating subsidiaries to the Company's other business lines. (2) Segment income (loss) includes depreciation and amortization expense and excludes general and administrative expense and interest expense for transitional and skilled services, assisted and independent living services and home health and hospice services segments. General and administrative expense, including charges related to class action lawsuit during the three months ended March 31, 2017, is included in the "All Other" category. (3) The Company's campuses represent facilities that offer skilled nursing, assisted and/or independent living services. Revenue and expenses related to skilled nursing, assisted and independent living services have been allocated and recorded in the respective reportable segment. Due to the adoption of ASC 606, the presentation of revenue changed from presenting total revenue to service revenue and assisted and independent living revenue. The following pro forma table demonstrates the impact of adopting ASC 606 on the Company's selected financial data consolidated by business segment for the three months ended March 31, 2018 , by showing revenue amounts as if the previous accounting guidance was still in effect. Three Months Ended March 31, 2018 (Pro forma) Transitional and Skilled Services (3) Assisted and Independent Living Services (3) Home Health and Hospice Services All Other Elimination Total Service revenue $ 415,221 $ — $ 40,357 $ 9,247 $ — $ 464,825 Assisted and independent living revenue — 36,113 — — — 36,113 Revenue from external customers $ 415,221 $ 36,113 $ 40,357 $ 9,247 $ — $ 500,938 Intersegment revenue (1) 689 — — 1,082 (1,771 ) — Total revenue $ 415,910 $ 36,113 $ 40,357 $ 10,329 $ (1,771 ) $ 500,938 Segment income (loss) (2) $ 46,195 $ 4,662 $ 6,058 $ (23,936 ) $ — $ 32,979 Interest expense, net of interest income $ (3,165 ) Income before provision for income taxes $ 29,814 Depreciation and amortization $ 7,802 $ 1,597 $ 245 $ 1,978 $ — $ 11,622 (1) Intersegment revenue represents services provided at the Company's operating subsidiaries to the Company's other business lines. (2) Segment income (loss) includes depreciation and amortization expense and excludes general and administrative expense and interest expense for transitional and skilled services, assisted and independent living services and home health and hospice services segments. General and administrative expense, including the return of unclaimed class action settlement for the three months ended March 31, 2018, is included in the "All Other" category. (3) The Company's campuses represent facilities that offer skilled nursing, assisted and/or independent living services. Revenue and expenses related to skilled nursing, assisted and independent living services have been allocated and recorded in the respective reportable segment. Due to the adoption of ASC 606, the presentation of revenue changed from presenting total revenue to service revenue and assisted and independent living revenue. The Company's transitional and skilled services segment income for the three months ended March 31, 2017 included continued obligations under the lease related to closed operations, lease termination costs and related closing expenses of $4,017 . This amount includes the present value of future rental payments of approximately $2,715 and long-lived assets impairment of $111 . See Note 16, Leases for further detail. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | ACQUISITIONS The acquisition focus of the subsidiaries is to purchase or lease operations that are complementary to the current affiliated operations, accretive to the business or otherwise advance the Company's strategy. The results of all operating subsidiaries are included in the accompanying Interim Financial Statements subsequent to the date of acquisition. Acquisitions are accounted for using the acquisition method of accounting. The affiliate operations also enters into long-term leases that may include options to purchase the facilities. As a result, from time to time, the affiliated operations will acquire facilities that has been operating under third-party leases. On January 1, 2018, the Company adopted Accounting Standards Codification Topic 805, Clarifying the Definition of a Business (ASC 805) prospectively, which changes the definition of a business to assist entities with evaluating when a set of transferred assets and activities is deemed to be a business. Determining whether a transferred set constitutes a business is important because the accounting for a business combination differs from that of an asset acquisition. The definition of a business also affects the accounting for dispositions. Under the new standard, when substantially all of the fair value of assets acquired is concentrated in a single asset, or a group of similar assets, the assets acquired would not represent a business and business combination accounting would not be required. The new standard may result in more transactions being accounted for as asset acquisitions rather than business combinations. The Company anticipates that future acquisitions will be classified as a mixture of business and asset acquisitions under the new guidance. During the three months ended March 31, 2018 , the Company acquired two stand-alone assisted living operations for an aggregate purchase price of $4,447 . The addition of these operations added 74 assisted living units to be operated by the Company's operating subsidiaries. The Company entered into a separate operations transfer agreement with the prior operator as part of each transaction. Substantially all of the fair value of the assets acquired is concentrated in property and equipment and as such, the transactions, which occurred during the first quarter, were classified as asset acquisitions in accordance with ASC 805. During the three months ended March 31, 2017 , the Company acquired operations for an aggregate purchase price of $8,693 , consisting of building and improvements of $5,290 , equipment of $449 , goodwill of $1,826 , other indefinite-lived intangible assets of $1,094 , assembled occupancy of $59 and other liabilities assumed of $25 . Subsequent to March 31, 2018 , the Company acquired one stand-alone skilled nursing operation and one campus operation for an aggregate purchase price of $19,500 . The addition of these operations added 253 operational skilled nursing beds and 143 assisted living units operated by the Company's operating subsidiaries. In addition, with the stand-alone skilled nursing operation acquisition, the Company acquired real estate that included an adjacent 50 bed long-term acute care hospital that is currently operated by a third party under a lease arrangement. As of the date of this filing, the preliminary allocation of the purchase price for the acquisitions acquired subsequent to March 31, 2018 was not completed as necessary valuation information was not yet available. As such, the Company has not made the determination whether these acquisitions should be classified as business combinations or asset acquisitions under ASC 805. |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] | PROPERTY AND EQUIPMENT— Net Property and equipment, net consist of the following: March 31, 2018 December 31, 2017 Land $ 49,382 $ 49,081 Buildings and improvements 348,977 342,641 Equipment 185,342 181,530 Furniture and fixtures 5,268 5,244 Leasehold improvements 99,511 97,221 Construction in progress 7,595 5,460 696,075 681,177 Less: accumulated depreciation (155,056 ) (144,093 ) Property and equipment, net $ 541,019 $ 537,084 See also Note 7, Acquisitions for information on acquisitions during the three months ended March 31, 2018 . |
Intangible Assets - Net
Intangible Assets - Net | 3 Months Ended |
Mar. 31, 2018 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Intangible Assets Disclosure [Text Block] | INTANGIBLE ASSETS — Net Weighted Average Life (Years) March 31, 2018 December 31, 2017 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Intangible Assets Net Net Lease acquisition costs 24.0 $ 483 $ (104 ) $ 379 $ 483 $ (99 ) $ 384 Favorable leases 30.2 35,116 (7,063 ) 28,053 35,116 (6,568 ) 28,548 Assembled occupancy 0.4 2,707 (2,671 ) 36 2,659 (2,631 ) 28 Facility trade name 30.0 733 (299 ) 434 733 (293 ) 440 Customer relationships 17.3 4,933 (1,599 ) 3,334 4,933 (1,530 ) 3,403 Total $ 43,972 $ (11,736 ) $ 32,236 $ 43,924 $ (11,121 ) $ 32,803 Amortization expense was $615 and $611 for the three months ended March 31, 2018 and 2017 , respectively. Estimated amortization expense for each of the years ending December 31 is as follows: Year Amount 2018 (remainder) $ 1,762 2019 2,301 2020 1,593 2021 1,497 2022 1,471 2023 1,409 Thereafter 22,203 $ 32,236 |
Goodwill and Other Indefinite-L
Goodwill and Other Indefinite-Lived Intangible Assets | 3 Months Ended |
Mar. 31, 2018 | |
Indefinite-Lived Intangible Assets (Including Goodwill) [Abstract] | |
Goodwill and Other Indefinite-Lived Intangibles [Text Block] | GOODWILL AND OTHER INDEFINITE-LIVED INTANGIBLE ASSETS The Company tests goodwill during the fourth quarter of each year or more often if events or circumstances indicate there may be impairment. The Company performs its analysis for each reporting unit that constitutes a business for which discrete financial information is produced and reviewed by operating segment management and provides services that are distinct from the other components of the operating segment, in accordance with the provisions of Accounting Standards Codification topic 350, Intangibles—Goodwill and Other (ASC 350). This guidance provides the option to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value, a "Step 0" analysis. If, based on a review of qualitative factors, it is more likely than not that the fair value of a reporting unit is less than its carrying value, the Company performs "Step 1" of the traditional two-step goodwill impairment test by comparing the net assets of each reporting unit to their respective fair values. The Company determines the estimated fair value of each reporting unit using a discounted cash flow analysis. In the event a unit's net assets exceed its fair value, an implied fair value of goodwill must be determined by assigning the unit's fair value to each asset and liability of the unit. The excess of the fair value of the reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill. An impairment loss is measured by the difference between the goodwill carrying value and the implied fair value. The following table represents activity in goodwill by segment as of and for the three months ended March 31, 2018 : Goodwill Transitional and Skilled Services Assisted and Independent Living Services Home Health and Hospice Services All Other Total January 1, 2018 $ 45,486 $ 3,958 $ 24,322 $ 7,296 $ 81,062 Purchase price adjustment — — — (99 ) (99 ) March 31, 2018 $ 45,486 $ 3,958 $ 24,322 $ 7,197 $ 80,963 The Company anticipates that the majority of total goodwill recognized will be fully deductible for tax purposes as of March 31, 2018 . See further discussion of goodwill acquired at Note 7, Acquisitions . Other indefinite-lived intangible assets consists of the following: March 31, 2018 December 31, 2017 Trade name $ 1,181 $ 1,181 Medicare and Medicaid licenses 24,068 24,068 $ 25,249 $ 25,249 |
Restricted and Other Assets
Restricted and Other Assets | 3 Months Ended |
Mar. 31, 2018 | |
Other Assets [Abstract] | |
Other Assets Disclosure [Text Block] | RESTRICTED AND OTHER ASSETS Restricted and other assets consist of the following: March 31, 2018 December 31, 2017 Debt issuance costs, net $ 2,568 $ 2,799 Long-term insurance losses recoverable asset 5,278 5,394 Deposits with landlords 7,205 5,981 Capital improvement reserves with landlords and lenders 2,535 2,327 Note receivable from sale of ancillary business 109 — Restricted and other assets $ 17,695 $ 16,501 Included in restricted and other assets as of March 31, 2018 , are anticipated insurance recoveries related to the Company's workers' compensation, general and professional liability claims that are recorded on a gross rather than net basis in accordance with an Accounting Standards Update issued by the FASB. |
Other Accrued Liabilities
Other Accrued Liabilities | 3 Months Ended |
Mar. 31, 2018 | |
Accrued Liabilities [Abstract] | |
Other Liabilities Disclosure [Text Block] | OTHER ACCRUED LIABILITIES Other accrued liabilities consist of the following: March 31, 2018 December 31, 2017 Quality assurance fee $ 4,908 $ 4,864 Refunds payable 22,971 21,661 Deferred revenue 6,251 7,066 Cash held in trust for patients 2,660 2,609 Resident deposits 6,841 6,574 Dividends payable 2,346 2,328 Property taxes 8,409 10,088 Operational closure liability 900 910 Other 7,802 7,715 Other accrued liabilities $ 63,088 $ 63,815 Quality assurance fee represents amounts payable to Arizona, California, Colorado, Idaho, Iowa, Kansas, Nebraska, Nevada, Utah, Washington and Wisconsin as a result of a mandated fee based on patient days or licensed beds. Refunds payable includes payables related to overpayments, duplicate payments and credit balances from various payor sources. Deferred revenue occurs when the Company receives payments in advance of services provided. Resident deposits include refundable deposits to patients. Cash held in trust for patients reflects monies received from, or on behalf of, patients. Maintaining a trust account for patients is a regulatory requirement and, while the trust assets offset the liabilities, the Company assumes a fiduciary responsibility for these funds. The cash balance related to this liability is included in other current assets in the accompanying consolidated balance sheets. Operational closure liability includes the short-term portion of the closing costs that are payable within the next 12 months. The remaining long-term portion is included in other long-term liabilities in the accompanying condensed consolidated balance sheets. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | INCOME TAXES The Tax Act was enacted on December 22, 2017. Effective January 1, 2018 the Tax Act reduces the corporate rate from 35.0% to 21.0%.The final impact of U.S. tax reform may differ, possibly materially, due to factors such as changes in interpretations of the Tax Act, any legislative action to address uncertainties that arise because of the Tax Act, and additional guidance that may be issued by the U.S. government. The Company has adopted ASU 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraph Pursuant to SEC Staff Accounting Bulletin No. 118 , which allows the company to record provisional amounts during the period of enactment. Any change to the provisional amounts will be recorded as an adjustment to the provision for income taxes in the period the amounts are determined. The measurement period ends when the company has obtained, prepared and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year of the enactment date. As of March 31, 2018 the Company has not completed its accounting for the tax effects of the enactment of the Tax Act. The Company continues to analyze certain aspects of the Tax Act and refining the estimates of its calculations, which could potentially impact the measurement of the Company's tax balances. In the three months ended March 31, 2018, there were no adjustments to the provisional amounts recorded in the period ended December 31, 2017. The Company recorded income tax expense of $6,521 in the three months ended March 31, 2018, or 21.9% of earnings before income taxes, compared to 32.8% for the three month period ended March 31, 2017. The Company’s effective tax rate for 2018 includes the benefit of the lower federal income tax rate of 21.0%, offset by various non-deductible expenses from the enactment of the Tax Act. The effective tax rate for the three months ended March 31, 2018 also includes excess tax benefits from stock-based compensation which were offset by tax expense due to the receipt of unclaimed class action settlement. The Company is not currently under examination by any major income tax jurisdiction. During 2018, the statutes of limitations will lapse on the Company's 2014 Federal tax year and certain 2013 and 2014 state tax years. The Company does not believe the Federal or state statute lapses or any other event will significantly impact the balance of unrecognized tax benefits in the next twelve months. The net balance of unrecognized tax benefits was not material to the Interim Financial Statements for the three months ended March 31, 2018 or 2017. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | DEBT Long-term debt consists of the following: March 31, 2018 December 31, 2017 Term loan with SunTrust, interest payable quarterly $ 138,750 $ 140,625 Credit facility with SunTrust 30,000 50,000 Mortgage loans and promissory note, principal and interest payable monthly, interest at fixed rate 124,847 125,394 293,597 316,019 Less: current maturities (10,035 ) (9,939 ) Less: debt issuance costs (3,113 ) (3,090 ) $ 280,449 $ 302,990 Credit Facility with a Lending Consortium Arranged by SunTrust The Company maintains a credit facility with a lending consortium arranged by SunTrust (as amended to date, the Credit Facility). The Company originally entered into the Credit Facility in an aggregate principal amount of $150,000 in May 2014. Under the Credit Facility, the Company could seek to obtain incremental revolving or term loans in an aggregate amount not to exceed $75,000 . The interest rates applicable to loans under the Credit Facility are, at the Company’s option, equal to either a base rate plus a margin ranging from 1.25% to 2.25% per annum or LIBOR plus a margin ranging from 2.25% to 3.25% per annum, based on the debt to Consolidated EBITDA ratio of the Company and its operating subsidiaries as defined in the agreement. In addition, the Company will pay a commitment fee on the unused portion of the commitments under the Credit Facility that will range from 0.30% to 0.50% per annum, depending on the debt to Consolidated EBITDA ratio of the Company and its operating subsidiaries. Loans made under the Credit Facility are not subject to interim amortization. The Company is not required to repay any loans under the Credit Facility prior to maturity, other than to the extent the outstanding borrowings exceed the aggregate commitments under the Credit Facility. On February 5, 2016, the Company amended its existing revolving credit facility to increase its aggregate principal amount available to $250,000 (the Amended Credit Facility). Under the credit facility, the Company may seek to obtain incremental revolving or term loans in an aggregate amount not to exceed $150,000 . The interest rates applicable to loans under the credit facility are, at the Company's option, equal to either a base rate plus a margin ranging from 0.75% to 1.75% per annum or LIBOR plus a margin ranging from 1.75% to 2.75% per annum, based on the Consolidated Total Net Debt to Consolidated EBITDA ratio (as defined in the agreement). In addition, the Company will pay a commitment fee on the unused portion of the commitments under the credit facility that will range from 0.30% to 0.50% per annum, depending on the Consolidated Total Net Debt to Consolidated EBITDA ratio of the Company and its subsidiaries. The Company is permitted to prepay all or any portion of the loans under the credit facility prior to maturity without premium or penalty, subject to reimbursement of any LIBOR breakage costs of the lenders. On July 19, 2016, the Company entered into the second amendment to the credit facility (Second Amended Credit Facility), which amended the existing credit agreement to increase the aggregate principal amount up to $450,000 . The Second Amended Credit Facility is comprised of a $300,000 revolving credit facility and a $150,000 term loan. Borrowings under the term loan portion of the Second Amended Credit Facility mature on February 5, 2021 and amortize in equal quarterly installments, in an aggregate annual amount equal to 5.0% per annum of the original principal amount. The interest rates and commitment fee applicable to the Second Amended Credit Facility are similar to the Amended Credit Facility discussed below. Except as set forth in the Second Amended Credit Facility, all other terms and conditions of the Amended Credit Facility remained in full force and effect as described below. The Credit Facility is guaranteed, jointly and severally, by certain of the Company’s wholly owned subsidiaries, and is secured by a pledge of stock of the Company's material operating subsidiaries as well as a first lien on substantially all of its personal property. The credit facility contains customary covenants that, among other things, restrict, subject to certain exceptions, the ability of the Company and its operating subsidiaries to grant liens on their assets, incur indebtedness, sell assets, make investments, engage in acquisitions, mergers or consolidations, amend certain material agreements and pay certain dividends and other restricted payments. Under the Credit Facility, the Company must comply with financial maintenance covenants to be tested quarterly, consisting of a maximum Consolidated Total Net Debt to consolidated EBITDA ratio (which shall be increased to 3.50 : 1.00 for the first fiscal quarter and the immediate following three fiscal quarters), and a minimum interest/rent coverage ratio (which cannot be below 1.50 : 1.00 ). The majority of lenders can require that the Company and its operating subsidiaries mortgage certain of its real property assets to secure the Amended Credit Facility if an event of default occurs, the Consolidated Total Net Debt to consolidated EBITDA ratio is above 2.75 : 1.00 for two consecutive fiscal quarters, or its liquidity is equal or less than 10% of the Aggregate Revolving Commitment Amount (as defined in the agreement) for ten consecutive business days, provided that such mortgages will no longer be required if the event of default is cured, the Consolidated Total Net Debt to consolidated EBITDA ratio is below 2.75 : 1.00 for two consecutive fiscal quarters, or its liquidity is above 10% of the Aggregate Revolving Commitment Amount (as defined in the agreement) or ninety consecutive days, as applicable. As of March 31, 2018 , the Company's operating subsidiaries had $168,750 outstanding under the Credit Facility. The outstanding balance on the term loan was $138,750 , of which $7,500 is classified as short-term and the remaining $131,250 is classified as long-term. The outstanding balance on the revolving Credit Facility was $30,000 , which is classified as long-term. The Company was in compliance with all loan covenants as of March 31, 2018 . As of April 27, 2018 , there was approximately $158,750 outstanding under the Credit Facility. Mortgage Loans and Promissory Note In December 2017, seventeen of the Company's subsidiaries entered into mortgage loans in the aggregate amount of $112,000 . The mortgage loans are insured with Department of Housing and Urban Development (HUD), which subjects these subsidiaries to HUD oversight and periodic inspections. The mortgage loans and note bear fixed interest rates of 3.3% per annum. Amounts borrowed under the mortgage loans may be prepaid, subject to prepayment fees of the principal balance on the date of prepayment. During the first three years, the prepayment fee is 10% and is reduced by 3% in the fourth year of the loan, and reduced by 1.0% per year for years five through ten of the loan. There is no prepayment penalty after year ten . The terms of the mortgage loans are 30 to 35 -years. The borrowings were arranged by Lancaster Pollard Mortgage Company, LLC, and insured by HUD. Loan proceeds were used to pay down previously drawn amounts on Ensign's revolving line of credit. In addition to refinancing existing borrowings, the proceeds of the HUD-insured debt helped fund acquisitions, to renovate and upgrade existing and future facilities, to cover working capital needs and for other business purposes. In addition to the HUD mortgage loans above, the Company had outstanding indebtedness under mortgage loans insured with HUD and a promissory note issued in connection with various acquisitions. These mortgage loans and note bear fixed interest rates between 2.6% and 5.3% per annum. Amounts borrowed under the mortgage loans may be prepaid starting after the second anniversary of the notes subject to prepayment fees of the principal balance on the date of prepayment. These prepayment fees are reduced by 1.0% per year for years three through eleven of the loan. There is no prepayment penalty after year eleven . The term of the mortgage loans and the note is between 12 and 33 years. The mortgage loans and note are secured by the real property comprising the facilities and the rents, issues and profits thereof, as well as all personal property used in the operation of the facilities. As of March 31, 2018 , the Company's operating subsidiaries had $124,847 outstanding under the mortgage loans and note, of which $2,535 is classified as short-term and the remaining $122,312 is classified as long-term. The Company was in compliance with all loan covenants as of March 31, 2018 . Based on Level 2, the carrying value of the Company's long-term debt is considered to approximate the fair value of such debt for all periods presented based upon the interest rates that the Company believes it can currently obtain for similar debt. Off-Balance Sheet Arrangements As of March 31, 2018 , the Company had approximately $6,304 on the credit facility of borrowing capacity pledged as collateral to secure outstanding letters of credit. |
Options and Awards
Options and Awards | 3 Months Ended |
Mar. 31, 2018 | |
Options and Awards [Abstract] | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | OPTIONS AND AWARDS Stock-based compensation expense consists of share-based payment awards made to employees and directors, including employee stock options and restricted stock awards, based on estimated fair values. As stock-based compensation expense recognized in the Company’s consolidated statements of income for the three months ended March 31, 2018 and 2017 was based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. The Company estimates forfeitures at the time of grant and, if necessary, revises the estimate in subsequent periods if actual forfeitures differ. Stock Options 2017 Omnibus Incentive Plan - The Company has one active stock incentive plan, the 2017 Omnibus Incentive Plan (the 2017 Plan). The 2017 Plan provides for the issuance of 6,881 shares of common stock. The number of shares available to be issued under the 2017 Plan will be reduced by (i) one share for each share that relates to an option or stock appreciation right award and (ii) 2.5 shares for each share which relates to an award other than a stock option or stock appreciation right award (a full-value award). Granted non-employee director options vest and become exercisable in three equal annual installments, or the length of the term if less than 3 years , on the completion of each year of service measured from the grant date. All other options generally vest over 5 years at 20% per year on the anniversary of the grant date. Options expire 10 years from the date of grant. At March 31, 2018 , there were 5,994 unissued shares of common stock available for issuance under this plan. The Company uses the Black-Scholes option-pricing model to recognize the value of stock-based compensation expense for all share-based payment awards. Determining the appropriate fair-value model and calculating the fair value of stock-based awards at the grant date requires considerable judgment, including estimating stock price volatility, expected option life and forfeiture rates. The Company develops estimates based on historical data and market information, which can change significantly over time. The Company granted 168 options and 57 restricted stock awards from the 2017 Plans during the three months ended March 31, 2018 . The Company used the following assumptions for stock options granted during the three months ended March 31, 2018 and 2017 : Grant Year Options Granted Weighted Average Risk-Free Rate Expected Life Weighted Average Volatility Weighted Average Dividend Yield 2018 168 2.7% 6.2 years 32.0% 0.7% 2017 156 2.0% 6.3 years 36.0% 0.8% For the three months ended March 31, 2018 and 2017 , the following represents the exercise price and fair value displayed at grant date for stock option grants: Grant Year Granted Weighted Average Exercise Price Weighted Average Fair Value of Options 2018 168 $ 26.53 $ 9.01 2017 156 $ 20.28 $ 7.15 The weighted average exercise price equaled the weighted average fair value of common stock on the grant date for all options granted during the periods ended March 31, 2018 and 2017 and therefore, the intrinsic value was $0 at date of grant. The following table represents the employee stock option activity during the three months ended March 31, 2018 and 2017 : Number of Options Outstanding Weighted Average Exercise Price Number of Options Vested Weighted Average Exercise Price of Options Vested January 1, 2018 4,739 $ 13.08 2,776 $ 10.07 Granted 168 26.53 Forfeited (26 ) 16.13 Exercised (355 ) 7.70 March 31, 2018 4,526 $ 13.98 2,638 $ 10.69 The following summary information reflects stock options outstanding, vested and related details as of March 31, 2018 : Stock Options Vested Stock Options Outstanding Number Outstanding Black-Scholes Fair Value Remaining Contractual Life (Years) Vested and Exercisable Year of Grant Exercise Price 2008 2.56 - 4.06 65 107 0 65 2009 4.06 - 4.56 398 858 1 398 2010 4.77 - 4.96 88 215 2 88 2011 5.90 - 7.99 107 366 3 107 2012 6.56 - 7.96 378 1,391 4 378 2013 7.98 - 11.49 504 2,448 5 429 2014 10.55 - 18.94 1,383 7,848 6 807 2015 21.47 - 25.24 530 4,829 7 231 2016 18.79 - 19.89 438 3,053 8 109 2017 18.64 - 22.90 467 3,263 9 26 2018 26.53 168 1,509 10 — Total 4,526 25,887 2,638 Restricted Stock Awards The Company granted 57 and 53 restricted stock awards during the three months ended March 31, 2018 and 2017 , respectively. All awards were granted at an exercise price of $0 and generally vest over five years . The fair value per share of restricted awards granted during the three months ended March 31, 2018 and 2017 ranged from $23.61 to $27.70 and $18.56 to $20.68 , respectively. The fair value per share includes quarterly stock awards to non-employee directors. A summary of the status of the Company's non-vested restricted stock awards as of March 31, 2018 and changes during the three months ended March 31, 2018 is presented below: Non-Vested Restricted Awards Weighted Average Grant Date Fair Value Nonvested at January 1, 2018 383 $ 20.65 Granted 57 26.28 Vested (48 ) 20.59 Forfeited (5 ) 22.04 Nonvested at March 31, 2018 387 $ 21.47 During the three months ended March 31, 2018 , the Company granted 8 automatic quarterly stock awards to non-employee directors for their service on the Company's board of directors. The fair value per share of these stock awards was $23.61 based on the market price on the grant date. Share-based compensation expense recognized for the Company's equity incentive plans for the three months ended March 31, 2018 and 2017 was as follows: Three Months Ended March 31, 2018 2017 Share-based compensation expense related to stock options $ 1,216 $ 1,207 Share-based compensation expense related to restricted stock awards 578 552 Share-based compensation expense related to stock options and restricted stock awards to non-employee directors 177 132 Total $ 1,971 $ 1,891 In future periods, the Company expects to recognize approximately $11,210 and $7,363 in share-based compensation expense for unvested options and unvested restricted stock awards, respectively, that were outstanding as of March 31, 2018 . Future share-based compensation expense will be recognized over 3.0 and 3.5 weighted average years for unvested options and restricted stock awards, respectively. There were 1,888 unvested and outstanding options at March 31, 2018 , of which 1,785 are expected to vest. The weighted average contractual life for options outstanding, vested and expected to vest at March 31, 2018 was 5.9 years. The aggregate intrinsic value of options outstanding, vested, expected to vest and exercised as of March 31, 2018 and December 31, 2017 is as follows: Options March 31, 2018 December 31, 2017 Outstanding $ 55,792 $ 44,060 Vested 41,182 33,976 Expected to vest 13,237 9,311 Exercisable 6,356 10,481 The intrinsic value is calculated as the difference between the market value of the underlying common stock and the exercise price of the options. Equity Instrument Denominated in the Shares of a Subsidiary On May 26, 2016, the Company implemented a management equity plan and granted stock options and restricted stock awards of a subsidiary of the Company to employees and management of that subsidiary (Subsidiary Equity Plan). These awards generally vest over a period of five years or upon the occurrence of certain prescribed events. The value of the stock options and restricted stock awards is tied to the value of the common stock of the subsidiary. The awards can be put to the Company at various prescribed dates, which in no event is earlier than six months after vesting of the restricted awards or exercise of the stock options. The Company can also call the awards, generally upon employee termination. The grant-date fair value of the awards is recognized as compensation expense over the relevant vesting periods, with a corresponding adjustment to noncontrolling interests. The grant value was determined based on an independent valuation of the subsidiary shares. For the three months ended March 31, 2018 and 2017 , the Company expensed $338 and $333 , respectively, in share-based compensation related to the Subsidiary Equity Plan. The aggregate number of the Company's common shares that would be required to settle these awards at current estimated fair values, including vested and unvested awards, at March 31, 2018 and 2017 is 223 and 251 , respectively. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2018 | |
Leases [Abstract] | |
Leases of Lessee Disclosure [Text Block] | LEASES The Company leases from CareTrust REIT, Inc. (CareTrust) real property associated with 92 affiliated skilled nursing, assisted living and independent living facilities used in the Company’s operations under eight “triple-net” master lease agreements (collectively, the Master Leases), which range in terms from 12 to 19 years. At the Company’s option, the Master Leases may be extended for two or three five -year renewal terms beyond the initial term, on the same terms and conditions. The extension of the term of any of the Master Leases is subject to the following conditions: (1) no event of default under any of the Master Leases having occurred and being continuing; and (2) the tenants providing timely notice of their intent to renew. The term of the Master Leases is subject to termination prior to the expiration of the then current term upon default by the tenants in their obligations, if not cured within any applicable cure periods set forth in the Master Leases. If the Company elects to renew the term of a Master Lease, the renewal will be effective to all, but not less than all, of the leased property then subject to the Master Lease. The Company does not have the ability to terminate the obligations under a Master Lease prior to its expiration without CareTrust’s consent. If a Master Lease is terminated prior to its expiration other than with CareTrust’s consent, the Company may be liable for damages and incur charges such as continued payment of rent through the end of the lease term as well as maintenance and repair costs for the leased property. Commencing the third year, the rent structure under the Master Leases includes a fixed component, subject to annual escalation equal to the lesser of (1) the percentage change in the Consumer Price Index (but not less than zero) or (2) 2.5% . In addition to rent, the Company is required to pay the following: (1) all impositions and taxes levied on or with respect to the leased properties (other than taxes on the income of the lessor); (2) all utilities and other services necessary or appropriate for the leased properties and the business conducted on the leased properties; (3) all insurance required in connection with the leased properties and the business conducted on the leased properties; (4) all facility maintenance and repair costs; and (5) all fees in connection with any licenses or authorizations necessary or appropriate for the leased properties and the business conducted on the leased properties. Total rent expense under the Master Leases was approximately $14,418 and $14,116 for the three months ended March 31, 2018 and 2017 , respectively. Among other things, under the Master Leases, the Company must maintain compliance with specified financial covenants measured on a quarterly basis, including a portfolio coverage ratio and a minimum rent coverage ratio. The Master Leases also include certain reporting, legal and authorization requirements. The Company is not aware of any defaults as of March 31, 2018 . The Company also leases certain affiliated operations and its administrative offices under non-cancelable operating leases, most of which have initial lease terms ranging from five to 20 years . The Company has entered into multiple lease agreements with various landlords to operate newly constructed state-of-the-art, full-service healthcare resorts upon completion of construction. The term of each lease is 15 years with two five -year renewal options and is subject to annual escalation equal to the percentage change in the Consumer Price Index with a stated cap percentage. In addition, the Company leases certain of its equipment under non-cancelable operating leases with initial terms ranging from three to five years . Most of these leases contain renewal options, certain of which involve rent increases. Total rent expense, inclusive of straight-line rent adjustments and rent associated with the Master Leases noted above, was $34,164 and $31,992 for the three months ended March 31, 2018 and 2017 , respectively. Twenty-nine of the Company’s affiliated facilities, excluding the facilities that are operated under the Master Leases with CareTrust, are operated under five separate master lease arrangements. Under these master leases, a breach at a single facility could subject one or more of the other facilities covered by the same master lease to the same default risk. Failure to comply with Medicare and Medicaid provider requirements is a default under several of the Company’s leases, master lease agreements and debt financing instruments. In addition, other potential defaults related to an individual facility may cause a default of an entire master lease portfolio and could trigger cross-default provisions in the Company’s outstanding debt arrangements and other leases. With an indivisible lease, it is difficult to restructure the composition of the portfolio or economic terms of the lease without the consent of the landlord. In first quarter of 2017, the Company voluntarily discontinued operations at one of its skilled nursing facilities after determining that the facility could not competitively operate in the marketplace without substantial investment renovating the building. After careful consideration, the Company determined that the costs to renovate the facility could outweigh the future returns from the operation. As part of this closure, the Company entered into an agreement with its landlord allowing for the closure of the property, as well as other provisions, to allow its landlord to transfer the property and the licenses free and clear of the applicable master lease. This arrangement does not impact the rent expense paid in 2017, or expected to be paid in future periods, and has no material impact on the Company's lease coverage ratios under the Master Leases. The Company recorded a continued obligation liability under the lease and related closing expenses of $2,830 , including the present value of rental payments of approximately $2,715 during the first quarter of 2017. Residents of the affected facility were transferred to local skilled nursing facilities. In March 2017, the Company entered into definitive agreements to sell the properties of two skilled nursing facilities and one assisted living community. The transaction closed in the second quarter of 2017. Upon closing the transaction, the Company leased the properties under a triple-net master lease with an initial 20 -year term, with three 5 -year optional extensions, at CPI-based annual escalators. The Company received $38,000 in proceeds. The carrying value for the sale was $24,847 . Under applicable accounting guidance, the master lease was classified as an operating lease. The Company recognized a deferred gain on the transaction of $13,153 during the second quarter of 2017 that is amortized over the life of the lease. During the first quarter of 2017, the Company terminated its lease obligations on four transitional care facilities that were under development at that time and one newly constructed stand-alone skilled nursing operation. The Company recorded $1,187 in lease termination costs and long-lived asset impairment. Future minimum lease payments for all leases as of March 31, 2018 are as follows: Year Amount 2018 (remainder) $ 101,614 2019 136,138 2020 135,827 2021 135,612 2022 134,082 2023 133,022 Thereafter 953,593 $ 1,729,888 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | COMMITMENTS AND CONTINGENCIES Regulatory Matters — Laws and regulations governing Medicare and Medicaid programs are complex and subject to interpretation. Compliance with such laws and regulations can be subject to future governmental review and interpretation, as well as significant regulatory action including fines, penalties, and exclusion from certain governmental programs. Included in these laws and regulations is the Health Insurance Portability and Accountability Act of 1996 (HIPAA), which requires healthcare providers (among other things) to safeguard the privacy and security of certain health information. In late December 2016, the Company learned of a potential issue at one of its independent operating entities in Arizona which involved the limited and inadvertent disclosure of certain confidential information. The issue has been internally investigated, addressed and disclosed as is required by law. The Company believes that it is presently in compliance in all material respects with applicable HIPAA laws and regulations. Cost-Containment Measures — Both government and private pay sources have instituted cost-containment measures designed to limit payments made to providers of healthcare services, and there can be no assurance that future measures designed to limit payments made to providers will not adversely affect the Company. Indemnities — From time to time, the Company enters into certain types of contracts that contingently require the Company to indemnify parties against third-party claims. These contracts primarily include (i) certain real estate leases, under which the Company may be required to indemnify property owners or prior facility operators for post-transfer environmental or other liabilities and other claims arising from the Company’s use of the applicable premises, (ii) operations transfer agreements, in which the Company agrees to indemnify past operators of facilities the Company acquires against certain liabilities arising from the transfer of the operation and/or the operation thereof after the transfer by the Company's operating subsidiary, (iii) certain lending agreements, under which the Company may be required to indemnify the lender against various claims and liabilities, and (iv) certain agreements with the Company’s officers, directors and employees, under which the Company may be required to indemnify such persons for liabilities arising out of their employment relationships. The terms of such obligations vary by contract and, in most instances, do not expressly state or include a specific or maximum dollar amount. Generally, amounts under these contracts cannot be reasonably estimated until a specific claim is asserted. Consequently, because no claims have been asserted, no liabilities have been recorded for these obligations on the Company’s balance sheets for any of the periods presented. Litigation — The skilled nursing business involves a significant risk of liability given the age and health of the patients and residents served by the Company's operating subsidiaries. The Company, its operating subsidiaries, and others in the industry are subject to an increasing number of claims and lawsuits, including professional liability claims, alleging that services provided have resulted in personal injury, elder abuse, wrongful death or other related claims. The defense of these lawsuits may result in significant legal costs, regardless of the outcome, and can result in large settlement amounts or damage awards. In addition to the potential lawsuits and claims described above, the Company is also subject to potential lawsuits under the Federal False Claims Act and comparable state laws alleging submission of fraudulent claims for services to any healthcare program (such as Medicare) or payor. A violation may provide the basis for exclusion from federally-funded healthcare programs. Such exclusions could have a correlative negative impact on the Company’s financial performance. Some states, including California, Arizona and Texas, have enacted similar whistleblower and false claims laws and regulations. In addition, the Deficit Reduction Act of 2005 created incentives for states to enact anti-fraud legislation modeled on the Federal False Claims Act. As such, the Company could face increased scrutiny, potential liability and legal expenses and costs based on claims under state false claims acts in markets in which its operating subsidiaries do business. In May 2009, Congress passed the Fraud Enforcement and Recovery Act (FERA) of 2009 which made significant changes to the Federal False Claims Act (FCA), expanding the types of activities subject to prosecution and whistleblower liability. Following changes by FERA, health care providers face significant penalties for the knowing retention of government overpayments, even if no false claim was involved. Health care providers can now be liable for knowingly and improperly avoiding or decreasing an obligation to pay money or property to the government. This includes the retention of any government overpayment. The government can argue, therefore, that a FCA violation can occur without any affirmative fraudulent action or statement, as long as it is knowingly improper. In addition, FERA extended protections against retaliation for whistleblowers, including protections not only for employees, but also contractors and agents. Thus, an employment relationship is generally not required in order to qualify for protection against retaliation for whistleblowing. Healthcare litigation (including class action litigation) is common and is filed based upon a wide variety of claims and theories, and the Company is routinely subjected to varying types of claims. One particular type of suit arises from alleged violations of minimum staffing requirements for skilled nursing facilities in those states which have enacted such requirements. Failure to meet these requirements can, among other things, jeopardize a facility's compliance with conditions of participation under certain state and federal healthcare programs; it may also subject the facility to a deficiency, a citation, a civil money penalty, or litigation. These class-action “staffing” suits have the potential to result in large jury verdicts and settlements. The Company expects the plaintiff's bar to continue to be aggressive in their pursuit of these staffing and similar claims. The Company and its operating subsidiaries have in the past been subject to class action litigation involving claims of alleged violations of regulatory requirements related to staffing. While the Company has been able to settle these claims without a material ongoing adverse effect on its business, future claims could be brought that may materially affect its business, financial condition and results of operations. Other claims and suits, including class actions, continue to be filed against the Company and other companies in its industry. If there were a significant increase in the number of these claims or an increase in amounts due as a result of these claims, this could materially adversely affect the Company’s business, financial condition, results of operations, and cash flows. The Company and its operating subsidiaries have been, and continue to be, subject to claims and legal actions that arise in the ordinary course of business, including potential claims related to patient care and treatment, as well as employment related claims. A significant increase in the number of these claims, or an increase in the amounts due as a result of these claims, could materially adversely affect the Company’s business, financial condition, results of operations and cash flows. In August of 2011, the Company was named as a Defendant in a class action litigation alleging violations of state and federal wage and hour law. In January of 2017, the Company participated in an initial mediation session with plaintiffs' counsel. As a result of this discussion and due to (i) the fact no class had been certified (ii) the lack of specificity as to legal theories put forth by the plaintiffs (iii) the nature of the remedies sought and (iv) the lack of any basis on which to compute estimated compensatory and/or exemplary damages, the Company could not predict what the outcome of the pending class action lawsuit would be, what the timing of the ultimate resolution of this lawsuit would be, or an estimate and/or range of possible loss related to it. In March of 2017, the Company was invited to engage in further settlement discussions to determine whether a resolution of the case in advance of a decision on class certification was possible. In April of 2017, the Company reached an agreement in principle to settle the subject class action litigation, without any admission of liability and subject to approval by the California Superior Court. Based upon the change in case status, the Company recorded an accrual for estimated probable losses of $11,000 , exclusive of legal fees, in the first quarter of 2017. The Company funded the settlement amount of $11,000 in December of 2017, and the funds were distributed to the class members in the first quarter of 2018. The Company received $1,664 related to settlement funds that class members declined to claim during the settlement process and recorded the recoveries in the first quarter of 2018 in accordance Joint Stipulation and Settlement Agreement dated June 2017. Other claims and suits continue to be filed against the Company and other companies in its industry. By way of example, a general/premises liability lawsuit was filed against one of the Company’s operating entities, in connection with an alleged injury to a non-employee/contractor. Further, another one of the Company’s independent operating entities was sued on allegations of professional negligence. The Company cannot predict or provide any assurance as to the possible outcome of any litigation. If any litigation were to proceed through trial, and the Company and its operating subsidiaries are subjected to, alleged to be liable for, or agree to a settlement of, claims or obligations under Federal Medicare statutes, the Federal False Claims Act, or similar State and Federal statutes and related regulations, the Company's business, financial condition and results of operations and cash flows could be materially and adversely affected and its stock price could be adversely impacted. Among other things, any settlement or litigation could involve the payment of substantial sums to settle any alleged civil violations, and may also include the assumption of specific procedural and financial obligations by the Company or its subsidiaries going forward under a corporate integrity agreement and/or other arrangements. Medicare Revenue Recoupments — The Company is subject to reviews relating to Medicare services, billings and potential overpayments as a result of Recovery Audit Contractors (RAC), Zone Program Integrity Contractors (ZPIC), Program Safeguard Contractors (PSC) and Medicaid Integrity Contributors (MIC) programs. As of March 31, 2018 , four of the Company's operating subsidiaries had probe reviews scheduled and in process, both pre- and post-payment. The Company anticipates that these probe reviews will increase in frequency in the future. If a facility fails a probe review and subsequent re-probes, the facility could then be subject to extended pre-pay review or extrapolation of the identified error rate to all billing in the same time period. None of the Company's operating subsidiaries are currently on extended prepayment review, although that may occur in the future. In addition, as of March 31, 2018 , a ZPIC review was recently concluded at one of the Company's hospice subsidiaries, and the results from the audit is currently under appeal. U.S. Government Inquiry — In October 2013, the Company completed and executed a settlement agreement (the Settlement Agreement) with the DOJ, which received the final approval of the Office of Inspector General-HHS and the United States District Court for the Central District of California. Pursuant to the Settlement Agreement, the Company made a single lump-sum remittance to the government in the amount of $48,000 in October 2013. The Company has denied engaging in any illegal conduct and has agreed to the settlement amount without any admission of wrongdoing in order to resolve the allegations and to avoid the uncertainty and expense of protracted litigation. In connection with the settlement and effective as of October 1, 2013, the Company entered into a five-year corporate integrity agreement (the CIA) with the Office of Inspector General-HHS. The CIA acknowledges the existence of the Company’s current compliance program, which is in accord with the Office of the Inspector General (OIG)’s guidance related to an effective compliance program, and requires that the Company continue during the term of the CIA to maintain a program designed to promote compliance with the statutes, regulations, and written directives of Medicare, Medicaid, and all other Federal health care programs. The Company is also required to notify the Office of Inspector General-HHS in writing, of, among other things: (i) any ongoing government investigation or legal proceeding involving an allegation that the Company has committed a crime or has engaged in fraudulent activities; (ii) any other matter that a reasonable person would consider a probable violation of applicable criminal, civil, or administrative laws related to compliance with federal healthcare programs; and (iii) any change in location, sale, closing, purchase, or establishment of a new business unit or location related to items or services that may be reimbursed by federal health care programs. The Company is also required to retain an Independent Review Organization (IRO) to review certain clinical documentation annually for the term of the CIA. The Company and its operating subsidiaries have continued to meet the requirements under the Settlement Agreement and pass its IRO audits. Participation in federal healthcare programs by the Company's operating subsidiaries is not affected by the Settlement Agreement or the CIA. In the event of an uncured material breach of the CIA, the Company could be excluded from participation in federal healthcare programs and/or subject to prosecution. Concentrations Credit Risk — The Company has significant accounts receivable balances, the collectability of which is dependent on the availability of funds from certain governmental programs, primarily Medicare and Medicaid. These receivables represent the only significant concentration of credit risk for the Company. The Company does not believe there are significant credit risks associated with these governmental programs. The Company believes that an appropriate allowance has been recorded for the possibility of these receivables proving uncollectible, and continually monitors and adjusts these allowances as necessary. The Company’s receivables from Medicare and Medicaid payor programs accounted for approximately 57.5% and 56.7% of its total accounts receivable as of March 31, 2018 and December 31, 2017 , respectively. Revenue from reimbursement under the Medicare and Medicaid programs accounted for 67.9% and 68.2% of the Company's revenue for the three months ended March 31, 2018 and 2017 , respectively. Cash in Excess of FDIC Limits — The Company currently has bank deposits with financial institutions in the U.S. that exceed FDIC insurance limits. FDIC insurance provides protection for bank deposits up to $250 . In addition, the Company has uninsured bank deposits with a financial institution outside the U.S. As of April 27, 2018 , the Company had approximately $920 in uninsured cash deposits. All uninsured bank deposits are held at high quality credit institutions. |
Common Stock
Common Stock | 3 Months Ended |
Mar. 31, 2018 | |
Common Stock [Abstract] | |
Common stock offering [Text Block] | COMMON STOCK As approved by the Board of Directors on April 3, 2018, the Company entered into a stock repurchase program pursuant to which the Company may repurchase up to $30,000 of its common stock under the program for a period of approximately 11 months . Under this program, the Company is authorized to repurchase its issued and outstanding common shares from time to time in open-market and privately negotiated transactions and block trades in accordance with federal securities laws. The stock repurchase program is scheduled to expire on February 20, 2019 . To date, the Company has not purchased any shares pursuant to this stock repurchase program. On February 8, 2017, the Company announced that its Board of Directors authorized a stock repurchase program, under which the Company may repurchase up to $30,000 of its common stock under the program for a period of 12 months . The stock repurchase program expired on February 8, 2018 . During the first quarter of 2017, the Company repurchased 343 shares of its common stock for a total of $6,068 . |
Significant Accounting Polici24
Significant Accounting Policies Level 2 (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation — The accompanying Interim Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP). The Company is the sole member or shareholder of various consolidated limited liability companies and corporations established to operate various acquired skilled nursing and assisted living operations, home health, hospice and home care operations, and related ancillary services. All intercompany transactions and balances have been eliminated in consolidation. The condensed consolidated financial statements include the accounts of all entities controlled by the Company through its ownership of a majority voting interest. The Company presents noncontrolling interest within the equity section of its condensed consolidated balance sheets. The Company presents the amount of consolidated net income that is attributable to The Ensign Group, Inc. and the noncontrolling interest in its condensed consolidated statements of income. |
Estimates and Assumptions | Estimates and Assumptions — The preparation of Interim Financial Statements in conformity with 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 Interim Financial Statements and the reported amounts of revenue and expenses during the reporting periods. The most significant estimates in the Company’s Interim Financial Statements relate to revenue, intangible assets and goodwill, impairment of long-lived assets, general and professional liability, workers' compensation and healthcare claims included in accrued self-insurance liabilities, and income taxes. Actual results could differ from those estimates. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments — The Company’s financial instruments consist principally of cash and cash equivalents, debt security investments, accounts receivable, insurance subsidiary deposits, accounts payable and borrowings. The Company believes all of the financial instruments’ recorded values approximate fair values because of their nature or respective short durations. |
Revenue Recognition | Revenue Recognition — On January 1, 2018, the Company adopted Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (ASC 606) applying the modified retrospective method. Results for reporting periods beginning January 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported under the accounting standards in effect for the prior period. The adoption of ASC 606 did not have a material impact on the measurement nor on the recognition of revenue of contracts, for which all revenue had not been recognized, as of January 1, 2018, therefore no cumulative adjustment has been made to the opening balance of retained earnings at the beginning of 2018. See Note 3, Revenue and Accounts Receivable . |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts — Accounts receivable consist primarily of amounts due from Medicare and Medicaid programs, other government programs, managed care health plans and private payor sources, net of estimates for variable consideration. The allowance for doubtful accounts reflects the Company’s best estimate of probable losses inherent in the accounts receivable balance. The Company determines the allowance based on known troubled accounts and other currently available evidence. See Note 3, Revenue and Accounts Receivable . |
Property and Equipment | Property and Equipment — Property and equipment are initially recorded at their historical cost. Repairs and maintenance are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the depreciable assets (ranging from three to 59 years ). Leasehold improvements are amortized on a straight-line basis over the shorter of their estimated useful lives or the remaining lease term. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets — The Company reviews the carrying value of long-lived assets that are held and used in the Company’s operating subsidiaries for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of these assets is determined based upon expected undiscounted future net cash flows from the operating subsidiaries to which the assets relate, utilizing management’s best estimate, appropriate assumptions, and projections at the time. If the carrying value is determined to be unrecoverable from future operating cash flows, the asset is deemed impaired and an impairment loss would be recognized to the extent the carrying value exceeded the estimated fair value of the asset. The Company estimates the fair value of assets based on the estimated future discounted cash flows of the asset. Management has evaluated its long-lived assets and recorded an impairment charge of $155 and $111 during the three months ended March 31, 2018 and 2017 , respectively. |
Leases and Leasehold Improvements | Leases and Leasehold Improvements - At the inception of each lease, the Company performs an evaluation to determine whether the lease should be classified as an operating or capital lease. The Company records rent expense for operating leases that contain scheduled rent increases on a straight-line basis over the term of the lease. The lease term used for straight-line rent expense is calculated from the date the Company is given control of the leased premises through the end of the lease term. The lease term used for this evaluation also provides the basis for establishing depreciable lives for buildings subject to lease and leasehold improvements, as well as the period over which the Company records straight-line rent expense. |
Intangible Assets and Goodwill | Intangible Assets and Goodwill — Definite-lived intangible assets consist primarily of favorable leases, lease acquisition costs, patient base, facility trade names and customer relationships. Favorable leases and lease acquisition costs are amortized over the life of the lease of the facility. Patient base is amortized over a period of four to eight months, depending on the classification of the patients and the level of occupancy in a new acquisition on the acquisition date. Trade names at affiliated facilities are amortized over 30 years and customer relationships are amortized over a period of up to 20 years . The Company's indefinite-lived intangible assets consist of trade names and Medicare and Medicaid licenses. The Company tests indefinite-lived intangible assets for impairment on an annual basis or more frequently if events or changes in circumstances indicate that the carrying amount of the intangible asset may not be recoverable. The Company did not identify any intangible asset or goodwill impairment during the three months ended March 31, 2018 and 2017 . Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations. Goodwill is subject to annual testing for impairment. In addition, goodwill is tested for impairment if events occur or circumstances change that would reduce the fair value of a reporting unit below its carrying amount. The Company performs its annual test for impairment during the fourth quarter of each year. See further discussion at Note 10, Goodwill and Other Indefinite-Lived Intangible Assets . |
Self-Insurance | Self-Insurance — The Company is partially self-insured for general and professional liability up to a base amount per claim (the self-insured retention) with an aggregate, one-time deductible above this limit. Losses beyond these amounts are insured through third-party policies with coverage limits per claim, per location and on an aggregate basis for the Company. The combined self-insured retention is $500 per claim, subject to an additional one-time deductible of $750 for California affiliated operations and a separate, one-time, deductible of $1,000 for non-California operations. For all affiliated operations, except those located in Colorado, the third-party coverage above these limits is $1,000 per claim, $3,000 per operation, with a $5,000 blanket aggregate limit and an additional state-specific aggregate where required by state law. In Colorado, the third-party coverage above these limits is $1,000 per claim and $3,000 per operation, which is independent of the aforementioned blanket aggregate limits that apply outside of Colorado. The self-insured retention and deductible limits for general and professional liability and workers' compensation for all states (except Texas and Washington for workers' compensation) are self-insured through the Captive, the related assets and liabilities of which are included in the accompanying condensed consolidated balance sheets. The Captive is subject to certain statutory requirements as an insurance provider. These requirements include, but are not limited to, maintaining statutory capital. The Company’s policy is to accrue amounts equal to the actuarially estimated costs to settle open claims of insureds, as well as an estimate of the cost of insured claims that have been incurred but not reported. The Company develops information about the size of the ultimate claims based on historical experience, current industry information and actuarial analysis, and evaluates the estimates for claim loss exposure on a quarterly basis. Accrued general liability and professional malpractice liabilities on an undiscounted basis, net of anticipated insurance recoveries, were $39,982 and $38,998 as of March 31, 2018 and December 31, 2017 , respectively. The Company’s operating subsidiaries are self-insured for workers’ compensation in California. To protect itself against loss exposure in California with this policy, the Company has purchased individual specific excess insurance coverage that insures individual claims that exceed $500 per occurrence. In Texas, the operating subsidiaries have elected non-subscriber status for workers’ compensation claims and the Company has purchased individual stop-loss coverage that insures individual claims that exceed $750 per occurrence. The Company’s operating subsidiaries in all other states, with the exception of Washington, are under a loss sensitive plan that insures individual claims that exceed $350 per occurrence. In Washington, the operating subsidiaries' coverage is financed through premiums paid by the employers and employees. The claims and pay benefits are managed through a state insurance pool. Outside of California, Texas and Washington, the Company has purchased insurance coverage that insures individual claims that exceed $350 per accident. In all states except Washington, the Company accrues amounts equal to the estimated costs to settle open claims, as well as an estimate of the cost of claims that have been incurred but not reported. The Company uses actuarial valuations to estimate the liability based on historical experience and industry information. Accrued workers’ compensation liabilities are recorded on an undiscounted basis in the accompanying condensed consolidated balance sheets and were $24,094 and $23,621 as of March 31, 2018 and December 31, 2017 , respectively. In addition, the Company has recorded an asset and equal liability of $5,278 and $5,394 at March 31, 2018 and December 31, 2017 , respectively, in order to present the ultimate costs of malpractice and workers' compensation claims and the anticipated insurance recoveries on a gross basis. See Note 11 Restricted and Other Assets. The Company self-funds medical (including prescription drugs) and dental healthcare benefits to the majority of its employees. The Company is fully liable for all financial and legal aspects of these benefit plans. To protect itself against loss exposure with this policy, the Company has purchased individual stop-loss insurance coverage that insures individual claims that exceed $300 for each covered person with an additional one-time aggregate individual stop loss deductible of $75 . Beginning 2016, the Company's policy does not include the additional one-time aggregate individual stop loss deductible of $75 . The Company’s accrued liability under these plans recorded on an undiscounted basis in the accompanying condensed consolidated balance sheets was $4,327 and $4,723 as of March 31, 2018 and December 31, 2017 , respectively. The Company believes that adequate provision has been made in the Interim Financial Statements for liabilities that may arise out of patient care, workers’ compensation, healthcare benefits and related services provided to date. The amount of the Company’s reserves was determined based on an estimation process that uses information obtained from both company-specific and industry data. This estimation process requires the Company to continuously monitor and evaluate the life cycle of the claims. Using data obtained from this monitoring and the Company’s assumptions about emerging trends, the Company, with the assistance of an independent actuary, develops information about the size of ultimate claims based on the Company’s historical experience and other available industry information. The most significant assumptions used in the estimation process include determining the trend in costs, the expected cost of claims incurred but not reported and the expected costs to settle or pay damage awards with respect to unpaid claims. The self-insured liabilities are based upon estimates, and while management believes that the estimates of loss are reasonable, the ultimate liability may be in excess of or less than the recorded amounts. Due to the inherent volatility of actuarially determined loss estimates, it is reasonably possible that the Company could experience changes in estimated losses that could be material to net income. If the Company’s actual liability exceeds its estimates of loss, its future earnings, cash flows and financial condition would be adversely affected. |
Income Taxes | Income Taxes — Deferred tax assets and liabilities are established for temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities at tax rates in effect when such temporary differences are expected to reverse. The Company generally expects to fully utilize its deferred tax assets; however, when necessary, the Company records a valuation allowance to reduce its net deferred tax assets to the amount that is more likely than not to be realized. In determining the need for a valuation allowance or the need for and magnitude of liabilities for uncertain tax positions, the Company makes certain estimates and assumptions. These estimates and assumptions are based on, among other things, knowledge of operations, markets, historical trends and likely future changes and, when appropriate, the opinions of advisors with knowledge and expertise in certain fields. Due to certain risks associated with the Company’s estimates and assumptions, actual results could differ. The Tax Cuts and Jobs Act (the Tax Act), which was enacted in December 2017, decreased the corporate income tax rate from 35.0% to 21.0% beginning on January 1, 2018. The Company’s actual effective tax rate for fiscal 2018 may differ from management’s estimate due to changes in interpretations and assumptions, and the excess tax benefits impact of share-based payment awards. See Note 13, Income Taxes for further detail. |
Noncontrolling Interest | Noncontrolling Interest — The noncontrolling interest in a subsidiary is initially recognized at estimated fair value on the acquisition date and is presented within total equity in the Company's consolidated balance sheets. The Company presents the noncontrolling interest and the amount of consolidated net income attributable to The Ensign Group, Inc. in its condensed consolidated statements of income and net income per share is calculated based on net income attributable to The Ensign Group, Inc.'s stockholders. The carrying amount of the noncontrolling interest is adjusted based on an allocation of subsidiary earnings based on ownership interest. |
Share-Based Compensation | Share-Based Compensation — The Company measures and recognizes compensation expense for all share-based payment awards made to employees and directors including employee stock options based on estimated fair values, ratably over the requisite service period of the award. Net income has been reduced as a result of the recognition of the fair value of all stock options and restricted stock awards issued, the amount of which is contingent upon the number of future grants and other variables. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements — Except for rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws and a limited number of grandfathered standards, the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) is the sole source of authoritative GAAP literature recognized by the FASB and applicable to the Company. For any new pronouncements announced, the Company considers whether the new pronouncements could alter previous generally accepted accounting principles and determines whether any new or modified principles will have a material impact on the Company's reported financial position or operations in the near term. The applicability of any standard is subject to the formal review of the Company's financial management and certain standards are under consideration. Recent Accounting Standards Adopted by the Company In 2014, the FASB and International Accounting Standards Board issued their final standard on revenue from contracts with customers that outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. Under this new standard and subsequently issued amendments, revenue is recognized at the time a good or service is transferred to a customer for the amount of consideration received. Entities may apply the new standard either retrospectively to each period presented (full retrospective method) or retrospectively with the cumulative effect recognized in beginning retained earnings as of the date of adoption (modified retrospective method). The Company adopted the new revenue standard as of January 1, 2018 using the modified retrospective transition method. The adoption of ASC 606 did not have a material impact on the measurement nor on the recognition of revenue of contracts for which all revenue had not been recognized as of January 1, 2018, therefore no cumulative adjustment has been made to the opening balance of retained earnings at the beginning of 2018. The comparative information has not been restated and continues to be reported under the accounting standards in effect for the period presented. In May 2017, the FASB issued amended authoritative guidance to provide guidance on types of changes to the terms or conditions of share-based payments awards to which an entity would be required to apply modification accounting under ASC 718. The new guidance was effective for the Company in the first quarter of fiscal year 2018. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. In January 2017, the FASB issued amended authoritative guidance to clarify the definition of a business and reduce diversity in practice related to the evaluation of whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The new provisions provide the requirements needed for an integrated set of assets and activities (the set) to be a business and also establish a practical way to determine when a set is not a business. The accounting standards update (ASU) provides a screen to determine when an integrated set of assets and activities is not a business. The more robust framework helps entities to narrow the definition of outputs created by the set and align it with how outputs are described in the new revenue standard. The new guidance was effective for the Company in the first quarter of fiscal year 2018. The Company's acquisitions during the three months ended March 31, 2018 were classified as asset acquisitions as the fair value of assets acquired is concentrated in a single asset. These acquisitions would have been classified as business combination prior to the adoption of the ASU. The Company anticipates that future acquisitions will be classified as a mixture of business and asset acquisitions under the new guidance. In March 2018, we adopted FASB ASU 2018-05, Income Taxes (topic 740): Amendments to the SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118, which updates the income tax accounting in U.S. GAAP to reflect the securities and Exchange Commission (‘SEC’) interpretive guidance released in December 2017, when the Tax Cuts and Jobs Act (the ‘Tax Act’) was signed into law. Additional information regarding the adoption of this standard is contained in Note 13, Income Taxes. In October 2016, the FASB issued amended authoritative guidance to require companies to recognize the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. The new guidance is required to be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The new guidance was effective for the Company in the first quarter of fiscal year 2018. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. In August 2016, the FASB issued amended authoritative guidance to reduce the diversity in practice related to the presentation and classification of certain cash receipts and cash payments in the statement of cash flows. The new provisions target cash flow issues related to (i) debt prepayment or debt extinguishment costs, (ii) settlement of debt instruments with coupon rates that are insignificant relative to effective interest rates, (iii) contingent consideration payments made after a business combination, (iv) proceeds from settlement of insurance claims, (v) proceeds from the settlement of corporate-owned life insurance and bank-owned life insurance policies, (vi) distributions received from equity method investees, (vii) beneficial interests in securitization transactions and (viii) separately identifiable cash flows and application of the predominance principle. The new guidance was effective for the Company in the first quarter of fiscal year 2018. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. Accounting Standards Recently Issued But Not Yet Adopted by the Company In January 2017, the FASB issued amended authoritative guidance to simplify and reduce the cost and complexity of the goodwill impairment test. The new provisions eliminate step 2 from the goodwill impairment test and shifts the concept of impairment from a measure of loss when comparing the implied fair value of goodwill to its carrying amount to comparing the fair value of a reporting unit with its carrying amount. The FASB also eliminated the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment or step 2 of the goodwill impairment test. The new guidance does not amend the optional qualitative assessment of goodwill impairment. This guidance is effective for annual periods beginning after December 15, 2019, which will be the Company's fiscal year 2020, with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company's consolidated financial statements. In February 2016, the FASB issued amended authoritative guidance on accounting for leases. The new provisions require that a lessee of operating leases recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. The lease liability will be equal to the present value of lease payments, with the right-of-use asset based upon the lease liability. The classification criteria for distinguishing between finance (or capital) leases and operating leases are substantially similar to the previous lease guidance, but with no explicit bright lines. As such, operating leases will result in straight-line rent expense similar to current practice. For short term leases (term of 12 months or less), a lessee is permitted to make an accounting election not to recognize lease assets and lease liabilities, which would generally result in lease expense being recognized on a straight-line basis over the lease term. This guidance applies to all entities and is effective for annual periods beginning after December 15, 2018, which will be the Company's fiscal year 2019, with early adoption permitted. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements but expects this adoption will result in a significant increase in the assets and liabilities on its consolidated balance sheets. |
Revenue and Accounts Receivab25
Revenue and Accounts Receivable (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
REVENUE AND ACCOUNTS RECEIVABLE [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | Three Months Ended March 31, 2018 2017 Total revenue As Reported $ 492,134 $ 441,739 Adjustments 8,804 — Pro forma as if the previous accounting guidance was in effect $ 500,938 $ 441,739 Cost of Services: As Reported $ 390,243 $ 355,486 Adjustments 8,804 — Pro forma as if the previous accounting guidance was in effect $ 399,047 $ 355,486 Total Expense: As Reported $ 459,155 $ 434,187 Adjustments 8,804 — Pro forma as if the previous accounting guidance was in effect $ 467,959 $ 434,187 |
Disaggregation of Revenue [Table Text Block] | Revenue for the three months ended March 31, 2018 and 2017 is summarized in the following tables: Three Months Ended March 31, 2018 2018 Pro Forma (2) 2017 Revenue % of Revenue Revenue % of Revenue Revenue % of Revenue Medicaid $ 167,625 34.1 % $ 170,309 34.0 % $ 148,271 33.6 % Medicare 139,314 28.3 140,381 28.0 129,920 29.4 Medicaid — skilled 27,042 5.5 27,538 5.5 23,017 5.2 Total Medicaid and Medicare 333,981 67.9 338,228 67.5 301,208 68.2 Managed care 83,716 17.0 85,845 17.1 75,562 17.1 Private and other payors (1) 74,437 15.1 76,865 15.4 64,969 14.7 Revenue $ 492,134 100.0 % $ 500,938 100.0 % $ 441,739 100.0 % (1) Private and other payors also includes revenue from all payors generated in other ancillary services for the three months ended March 31, 2018 and 2017. (2) The 2018 pro forma results reflect balances assuming previous accounting guidance was still in effect. |
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] | ccounts receivable as of March 31, 2018 and December 31, 2017 is summarized in the following table: March 31, December 31, 2018 2018 Pro Forma (1) 2017 Medicaid $ 99,799 $ 112,419 $ 119,441 Managed care 59,358 71,955 68,930 Medicare 49,765 55,361 55,667 Private and other payors 51,349 64,983 64,991 260,271 304,718 309,029 Less: allowance for doubtful accounts (1,762 ) (46,209 ) (43,961 ) Accounts receivable, net $ 258,509 $ 258,509 $ 265,068 (1) The 2018 pro forma results reflect balances assuming previous accounting guidance was still in effect. |
Computation of Net Income Per26
Computation of Net Income Per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
COMPUTATION OF NET INCOME PER COMMON SHARE [Abstract] | |
Schedule of Earnings Per Share, Basic, by Common Class, Including Two Class Method [Table Text Block] | A reconciliation of the numerator and denominator used in the calculation of basic net income per common share follows: Three Months Ended March 31, 2018 2017 Numerator: Net income $ 23,293 $ 2,956 Less: net income attributable to noncontrolling interests 161 116 Net income attributable to The Ensign Group, Inc. $ 23,132 $ 2,840 Denominator: Weighted average shares outstanding for basic net income per share 51,585 50,767 Basic net income per common share attributable to The Ensign Group, Inc. $ 0.45 $ 0.06 |
Schedule of Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Table Text Block] | A reconciliation of the numerator and denominator used in the calculation of diluted net income per common share follows: Three Months Ended March 31, 2018 2017 Numerator: Net income $ 23,293 $ 2,956 Less: net income attributable to noncontrolling interests 161 116 Net income attributable to The Ensign Group, Inc. $ 23,132 $ 2,840 Denominator: Weighted average common shares outstanding 51,585 50,767 Plus: incremental shares from assumed conversion (1) 1,933 1,866 Adjusted weighted average common shares outstanding 53,518 52,633 Diluted net income per common share attributable to The Ensign Group, Inc. $ 0.43 $ 0.05 (1) Options outstanding which are anti-dilutive and therefore not factored into the weighted average common shares amount above were 937 and 1,272 for the three months ended March 31, 2018 and 2017 , respectively. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets Measured on Recurring Basis [Table Text Block] | The following table summarizes the financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017 : March 31, 2018 December 31, 2017 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Cash and cash equivalents $ 35,057 $ — $ — $ 42,337 $ — $ — |
Business Segments (Tables)
Business Segments (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Segments to Consolidated [Table Text Block] | Segment revenues by major payor source were as follows: Three Months Ended March 31, 2018 Transitional and Skilled Services Assisted and Independent Living Services Home Health and Hospice Services All Other Total Revenue Revenue % Medicaid $ 156,511 $ 8,264 $ 2,850 $ — $ 167,625 34.1 % Medicare 111,953 — 27,361 — 139,314 28.3 Medicaid-skilled 27,042 — — — 27,042 5.5 Subtotal 295,506 8,264 30,211 — 333,981 67.9 Managed care 77,800 — 5,916 — 83,716 17.0 Private and other 33,710 27,849 3,631 9,247 (1) 74,437 15.1 Total revenue $ 407,016 $ 36,113 $ 39,758 $ 9,247 $ 492,134 100.0 % (1) Private and other payors also includes revenue from all payors generated in other ancillary services for the three months ended March 31, 2018. Three Months Ended March 31, 2017 Transitional and Skilled Services Assisted and Independent Living Services Home Health and Hospice Services All Other Total Revenue Revenue % Medicaid $ 138,825 $ 7,036 $ 2,410 $ — $ 148,271 33.6 % Medicare 107,928 — 21,992 — 129,920 29.4 Medicaid-skilled 23,017 — — — 23,017 5.2 Subtotal 269,770 7,036 24,402 — 301,208 68.2 Managed care 70,357 — 5,205 — 75,562 17.1 Private and other 32,212 25,310 2,526 4,921 (1) 64,969 14.7 Total revenue $ 372,339 $ 32,346 $ 32,133 $ 4,921 $ 441,739 100.0 % (1) Private and other payors also includes revenue from all payors generated in other ancillary services for the three months ended March 31, 2017. The following pro forma table demonstrates the impact of adopting ASC 606 on the Company's segment revenues by major payor source for the three months ended March 31, 2018 , by showing revenue amounts as if the previous accounting guidance was still in effect. Three Months Ended March 31, 2018 (Pro forma) Transitional and Skilled Services Assisted and Independent Living Services (2) Home Health and Hospice Services All Other Total Revenue Revenue % Medicaid $ 159,104 $ 8,264 $ 2,941 $ — $ 170,309 34.0 % Medicare 112,777 — 27,604 — 140,381 28.0 Medicaid-skilled 27,538 — — — 27,538 5.5 Subtotal 299,419 8,264 30,545 — 338,228 67.5 Managed care 79,698 — 6,147 — 85,845 17.1 Private and other 36,104 27,849 3,665 9,247 (1) 76,865 15.4 Total revenue $ 415,221 $ 36,113 $ 40,357 $ 9,247 $ 500,938 100.0 % (1) Private and other payors also includes revenue from all payors generated in other ancillary services for the three months ended March 31, 2018. |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | The following table sets forth selected financial data consolidated by business segment: Three Months Ended March 31, 2018 Transitional and Skilled Services (3) Assisted and Independent Living Services (3) Home Health and Hospice Services All Other Elimination Total Service revenue $ 407,016 $ — $ 39,758 $ 9,247 $ — $ 456,021 Assisted and independent living revenue — 36,113 — — — 36,113 Revenue from external customers $ 407,016 $ 36,113 $ 39,758 $ 9,247 $ — $ 492,134 Intersegment revenue (1) 689 — — 1,082 (1,771 ) — Total revenue $ 407,705 $ 36,113 $ 39,758 $ 10,329 $ (1,771 ) $ 492,134 Segment income (loss) (2) $ 46,195 $ 4,662 $ 6,058 $ (23,936 ) $ — $ 32,979 Interest expense, net of interest income $ (3,165 ) Income before provision for income taxes $ 29,814 Depreciation and amortization $ 7,802 $ 1,597 $ 245 $ 1,978 $ — $ 11,622 (1) Intersegment revenue represents services provided at the Company's operating subsidiaries to the Company's other business lines. (2) Segment income (loss) includes depreciation and amortization expense and excludes general and administrative expense and interest expense for transitional and skilled services, assisted and independent living services and home health and hospice services segments. General and administrative expense, including the return of unclaimed class action settlement for the three months ended March 31, 2018, is included in the "All Other" category. (3) The Company's campuses represent facilities that offer skilled nursing, assisted and/or independent living services. Revenue and expenses related to skilled nursing, assisted and independent living services have been allocated and recorded in the respective reportable segment. Due to the adoption of ASC 606, the presentation of revenue changed from presenting total revenue to service revenue and assisted and independent living revenue. Three Months Ended March 31, 2017 Transitional and Skilled Services (3) Assisted and Independent Living Services (3) Home Health and Hospice Services All Other Elimination Total Service revenue $ 372,339 $ — $ 32,133 $ 4,921 $ — $ 409,393 Assisted and independent living revenue — $ 32,346 $ — $ — — 32,346 Revenue from external customers $ 372,339 $ 32,346 $ 32,133 $ 4,921 $ — $ 441,739 Intersegment revenue (1) 744 — — 884 (1,628 ) — Total revenue $ 373,083 $ 32,346 $ 32,133 $ 5,805 $ (1,628 ) $ 441,739 Segment income (loss) (2) $ 31,790 $ 4,439 $ 4,294 $ (32,971 ) $ — $ 7,552 Interest expense, net of interest income $ (3,155 ) Income before provision for income taxes $ 4,397 Depreciation and amortization $ 6,953 $ 1,623 $ 235 $ 1,703 $ — $ 10,514 (1) Intersegment revenue represents services provided at the Company's operating subsidiaries to the Company's other business lines. (2) Segment income (loss) includes depreciation and amortization expense and excludes general and administrative expense and interest expense for transitional and skilled services, assisted and independent living services and home health and hospice services segments. General and administrative expense, including charges related to class action lawsuit during the three months ended March 31, 2017, is included in the "All Other" category. (3) The Company's campuses represent facilities that offer skilled nursing, assisted and/or independent living services. Revenue and expenses related to skilled nursing, assisted and independent living services have been allocated and recorded in the respective reportable segment. Due to the adoption of ASC 606, the presentation of revenue changed from presenting total revenue to service revenue and assisted and independent living revenue. The following pro forma table demonstrates the impact of adopting ASC 606 on the Company's selected financial data consolidated by business segment for the three months ended March 31, 2018 , by showing revenue amounts as if the previous accounting guidance was still in effect. Three Months Ended March 31, 2018 (Pro forma) Transitional and Skilled Services (3) Assisted and Independent Living Services (3) Home Health and Hospice Services All Other Elimination Total Service revenue $ 415,221 $ — $ 40,357 $ 9,247 $ — $ 464,825 Assisted and independent living revenue — 36,113 — — — 36,113 Revenue from external customers $ 415,221 $ 36,113 $ 40,357 $ 9,247 $ — $ 500,938 Intersegment revenue (1) 689 — — 1,082 (1,771 ) — Total revenue $ 415,910 $ 36,113 $ 40,357 $ 10,329 $ (1,771 ) $ 500,938 Segment income (loss) (2) $ 46,195 $ 4,662 $ 6,058 $ (23,936 ) $ — $ 32,979 Interest expense, net of interest income $ (3,165 ) Income before provision for income taxes $ 29,814 Depreciation and amortization $ 7,802 $ 1,597 $ 245 $ 1,978 $ — $ 11,622 (1) Intersegment revenue represents services provided at the Company's operating subsidiaries to the Company's other business lines. (2) Segment income (loss) includes depreciation and amortization expense and excludes general and administrative expense and interest expense for transitional and skilled services, assisted and independent living services and home health and hospice services segments. General and administrative expense, including the return of unclaimed class action settlement for the three months ended March 31, 2018, is included in the "All Other" category. (3) The Company's campuses represent facilities that offer skilled nursing, assisted and/or independent living services. Revenue and expenses related to skilled nursing, assisted and independent living services have been allocated and recorded in the respective reportable segment. Due to the adoption of ASC 606, the presentation of revenue changed from presenting total revenue to service revenue and assisted and independent living revenue. |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Property and equipment, net consist of the following: March 31, 2018 December 31, 2017 Land $ 49,382 $ 49,081 Buildings and improvements 348,977 342,641 Equipment 185,342 181,530 Furniture and fixtures 5,268 5,244 Leasehold improvements 99,511 97,221 Construction in progress 7,595 5,460 696,075 681,177 Less: accumulated depreciation (155,056 ) (144,093 ) Property and equipment, net $ 541,019 $ 537,084 |
Intangible Assets - Net (Tables
Intangible Assets - Net (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | Weighted Average Life (Years) March 31, 2018 December 31, 2017 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Intangible Assets Net Net Lease acquisition costs 24.0 $ 483 $ (104 ) $ 379 $ 483 $ (99 ) $ 384 Favorable leases 30.2 35,116 (7,063 ) 28,053 35,116 (6,568 ) 28,548 Assembled occupancy 0.4 2,707 (2,671 ) 36 2,659 (2,631 ) 28 Facility trade name 30.0 733 (299 ) 434 733 (293 ) 440 Customer relationships 17.3 4,933 (1,599 ) 3,334 4,933 (1,530 ) 3,403 Total $ 43,972 $ (11,736 ) $ 32,236 $ 43,924 $ (11,121 ) $ 32,803 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | Estimated amortization expense for each of the years ending December 31 is as follows: Year Amount 2018 (remainder) $ 1,762 2019 2,301 2020 1,593 2021 1,497 2022 1,471 2023 1,409 Thereafter 22,203 $ 32,236 |
Goodwill and Other Indefinite31
Goodwill and Other Indefinite-Lived Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Indefinite-Lived Intangible Assets (Including Goodwill) [Abstract] | |
Schedule of Goodwill [Table Text Block] | The following table represents activity in goodwill by segment as of and for the three months ended March 31, 2018 : Goodwill Transitional and Skilled Services Assisted and Independent Living Services Home Health and Hospice Services All Other Total January 1, 2018 $ 45,486 $ 3,958 $ 24,322 $ 7,296 $ 81,062 Purchase price adjustment — — — (99 ) (99 ) March 31, 2018 $ 45,486 $ 3,958 $ 24,322 $ 7,197 $ 80,963 |
Schedule of Acquired Indefinite-lived Intangible Assets by Major Class [Table Text Block] | Other indefinite-lived intangible assets consists of the following: March 31, 2018 December 31, 2017 Trade name $ 1,181 $ 1,181 Medicare and Medicaid licenses 24,068 24,068 $ 25,249 $ 25,249 |
Restricted and Other Assets (Ta
Restricted and Other Assets (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Other Assets [Abstract] | |
Schedule of Other Assets [Table Text Block] | Restricted and other assets consist of the following: March 31, 2018 December 31, 2017 Debt issuance costs, net $ 2,568 $ 2,799 Long-term insurance losses recoverable asset 5,278 5,394 Deposits with landlords 7,205 5,981 Capital improvement reserves with landlords and lenders 2,535 2,327 Note receivable from sale of ancillary business 109 — Restricted and other assets $ 17,695 $ 16,501 |
Other Accrued Liabilities (Tabl
Other Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Accrued Liabilities [Abstract] | |
Schedule of Accrued Liabilities [Table Text Block] | Other accrued liabilities consist of the following: March 31, 2018 December 31, 2017 Quality assurance fee $ 4,908 $ 4,864 Refunds payable 22,971 21,661 Deferred revenue 6,251 7,066 Cash held in trust for patients 2,660 2,609 Resident deposits 6,841 6,574 Dividends payable 2,346 2,328 Property taxes 8,409 10,088 Operational closure liability 900 910 Other 7,802 7,715 Other accrued liabilities $ 63,088 $ 63,815 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | Long-term debt consists of the following: March 31, 2018 December 31, 2017 Term loan with SunTrust, interest payable quarterly $ 138,750 $ 140,625 Credit facility with SunTrust 30,000 50,000 Mortgage loans and promissory note, principal and interest payable monthly, interest at fixed rate 124,847 125,394 293,597 316,019 Less: current maturities (10,035 ) (9,939 ) Less: debt issuance costs (3,113 ) (3,090 ) $ 280,449 $ 302,990 |
Options and Awards (Tables)
Options and Awards (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Options and Awards [Abstract] | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | The Company used the following assumptions for stock options granted during the three months ended March 31, 2018 and 2017 : Grant Year Options Granted Weighted Average Risk-Free Rate Expected Life Weighted Average Volatility Weighted Average Dividend Yield 2018 168 2.7% 6.2 years 32.0% 0.7% 2017 156 2.0% 6.3 years 36.0% 0.8% |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value [Table Text Block] | For the three months ended March 31, 2018 and 2017 , the following represents the exercise price and fair value displayed at grant date for stock option grants: Grant Year Granted Weighted Average Exercise Price Weighted Average Fair Value of Options 2018 168 $ 26.53 $ 9.01 2017 156 $ 20.28 $ 7.15 |
Schedule of Common Stock Outstanding Roll Forward [Table Text Block] | The following table represents the employee stock option activity during the three months ended March 31, 2018 and 2017 : Number of Options Outstanding Weighted Average Exercise Price Number of Options Vested Weighted Average Exercise Price of Options Vested January 1, 2018 4,739 $ 13.08 2,776 $ 10.07 Granted 168 26.53 Forfeited (26 ) 16.13 Exercised (355 ) 7.70 March 31, 2018 4,526 $ 13.98 2,638 $ 10.69 |
Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range [Table Text Block] | The following summary information reflects stock options outstanding, vested and related details as of March 31, 2018 : Stock Options Vested Stock Options Outstanding Number Outstanding Black-Scholes Fair Value Remaining Contractual Life (Years) Vested and Exercisable Year of Grant Exercise Price 2008 2.56 - 4.06 65 107 0 65 2009 4.06 - 4.56 398 858 1 398 2010 4.77 - 4.96 88 215 2 88 2011 5.90 - 7.99 107 366 3 107 2012 6.56 - 7.96 378 1,391 4 378 2013 7.98 - 11.49 504 2,448 5 429 2014 10.55 - 18.94 1,383 7,848 6 807 2015 21.47 - 25.24 530 4,829 7 231 2016 18.79 - 19.89 438 3,053 8 109 2017 18.64 - 22.90 467 3,263 9 26 2018 26.53 168 1,509 10 — Total 4,526 25,887 2,638 |
Schedule of Nonvested Restricted Stock Units Activity [Table Text Block] | A summary of the status of the Company's non-vested restricted stock awards as of March 31, 2018 and changes during the three months ended March 31, 2018 is presented below: Non-Vested Restricted Awards Weighted Average Grant Date Fair Value Nonvested at January 1, 2018 383 $ 20.65 Granted 57 26.28 Vested (48 ) 20.59 Forfeited (5 ) 22.04 Nonvested at March 31, 2018 387 $ 21.47 |
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block] | Share-based compensation expense recognized for the Company's equity incentive plans for the three months ended March 31, 2018 and 2017 was as follows: Three Months Ended March 31, 2018 2017 Share-based compensation expense related to stock options $ 1,216 $ 1,207 Share-based compensation expense related to restricted stock awards 578 552 Share-based compensation expense related to stock options and restricted stock awards to non-employee directors 177 132 Total $ 1,971 $ 1,891 |
Share-based Compensation, Schedule of Intrisice Values by Option Category [Table Text Block] | The aggregate intrinsic value of options outstanding, vested, expected to vest and exercised as of March 31, 2018 and December 31, 2017 is as follows: Options March 31, 2018 December 31, 2017 Outstanding $ 55,792 $ 44,060 Vested 41,182 33,976 Expected to vest 13,237 9,311 Exercisable 6,356 10,481 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Leases [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | Future minimum lease payments for all leases as of March 31, 2018 are as follows: Year Amount 2018 (remainder) $ 101,614 2019 136,138 2020 135,827 2021 135,612 2022 134,082 2023 133,022 Thereafter 953,593 $ 1,729,888 |
Description of Business (Detail
Description of Business (Details) | Mar. 31, 2018businessBedsfacilities | Dec. 31, 2017facilities |
Skilled nursing, assisted living and independent living facilities [Abstract] | ||
Number of Real Estate Properties | 65 | 63 |
Number of Real Estate Properties Leased | 167 | 167 |
Number of Real Estate Properties Leased with an Option to Purchase | 11 | 11 |
Number of Real Estate Properties Operated | 232 | 230 |
Home Health, Hospice and Home Care Operations | business | 46 | |
Operational Skilled Nursing Beds | Beds | 18,900 | |
Operational Skilled Nursing, Assisted Living and Independent Living Beds [Abstract] | ||
Operational Skilled Nursing, Assisted Living and Independent Living Beds | Beds | 5,100 |
Significant Accounting Polici38
Significant Accounting Policies Revenue Recognition (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Retained Earnings | $ 285,398 | $ 264,691 | |
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Retained Earnings | $ 0 |
Significant Accounting Polici39
Significant Accounting Policies Property and Equipment (Details) | 3 Months Ended |
Mar. 31, 2018 | |
Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 59 years |
Significant Accounting Polici40
Significant Accounting Policies Impairment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Accounting Policies [Abstract] | ||
Impairment of Indefinite-lived Intangible Assets | $ 0 | $ 0 |
Impairment of Long-lived Assets | $ 0 | $ 0 |
Significant Accounting Polici41
Significant Accounting Policies Intangible Assets and Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill, Impairment Loss | $ 0 | $ 0 |
Assembled occupancy | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 4 months | |
Assembled occupancy | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 8 months | |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 30 years | |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 20 years |
Significant Accounting Polici42
Significant Accounting Policies Self-Insurance General and Professional (Details) - General and Professional Liability Insurance [Member] - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | $ 39,982 | $ 38,998 |
Self-insurance retention per claim [Member] | Parent Company [Member] | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | 500 | |
Aggregate Deductible [Member] | Parent Company [Member] | CALIFORNIA | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | 750 | |
Aggregate Deductible [Member] | Parent Company [Member] | Non-California [Domain] | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | 1,000 | |
Blanket Aggregate [Member] | Third-Party Payor [Member] | All States Except Colorado [Domain] | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | 5,000 | |
Per Facility [Member] | Third-Party Payor [Member] | All States Except Colorado [Domain] | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | 3,000 | |
Per Facility [Member] | Third-Party Payor [Member] | COLORADO | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | 3,000 | |
Per Occurence [Member] | Third-Party Payor [Member] | All States Except Colorado [Domain] | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | 1,000 | |
Per Occurence [Member] | Third-Party Payor [Member] | COLORADO | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | $ 1,000 |
Significant Accounting Polici43
Significant Accounting Policies Self-Insurance Workers' Compensation (Details) - Workers' Compensation [Member] - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | $ 24,094 | $ 23,621 |
Stop-Loss Insurance limit per claim [Member] | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | 500 | |
Stop-Loss Insurance limit per claim [Member] | TEXAS | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | 750 | |
Loss-Sensitive limit per claim [Member] [Member] | Other states, except California, Texas and Washington [Domain] | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | $ 350 |
Significant Accounting Polici44
Significant Accounting Policies Self Insurance Recoveries (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Accounting Policies [Abstract] | ||
Long-term insurance losses recoverable asset | $ 5,278 | $ 5,394 |
Significant Accounting Polici45
Significant Accounting Policies Self-Insurance Health Insurance (Details) - Health Liability Insurance [Member] - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | $ 4,327 | $ 4,723 |
Stop-Loss Insurance limit per claim [Member] | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | 300 | |
Stop Loss Deductible [Member] | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Self Insurance Reserve | $ 75 |
Revenue and Accounts Receivab46
Revenue and Accounts Receivable Revenue from Medicare and Medicaid Programs (Details) | 3 Months Ended | |
Mar. 31, 2018Rate | Mar. 31, 2017Rate | |
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||
Revenue by payor as a percent of total revenue | 100.00% | 100.00% |
Total Medicare and Medicaid | ||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||
Revenue by payor as a percent of total revenue | 67.90% | 68.20% |
Revenue and Accounts Receivab47
Revenue and Accounts Receivable Impact of New Revenue Guidance (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue | $ 492,134 | $ 441,739 |
Cost of Services | 390,243 | 355,486 |
Total Expense | 459,155 | 434,187 |
Provision for Doubtful Accounts | $ 570 | $ 7,350 |
Bad Debt Expense as a Percent of Total Revenue | 0.10% | 1.70% |
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue | $ 8,804 | $ 0 |
Cost of Services | 8,804 | 0 |
Total Expense | 8,804 | 0 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue | 500,938 | 441,739 |
Cost of Services | 399,047 | 355,486 |
Total Expense | $ 467,959 | $ 434,187 |
Revenue and Accounts Receivab48
Revenue and Accounts Receivable Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | |||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||||
Revenue from Contract with Customer | $ 492,134 | |||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 100.00% | |||
Health Care Organization, Revenue | $ 500,938 | [1] | $ 441,739 | |
Revenue by payor as a percent of total revenue | 100.00% | 100.00% | ||
Medicaid | ||||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||||
Revenue from Contract with Customer | $ 167,625 | |||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 34.10% | |||
Health Care Organization, Revenue | $ 170,309 | [1] | $ 148,271 | |
Revenue by payor as a percent of total revenue | 34.00% | 33.60% | ||
Medicare | ||||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||||
Revenue from Contract with Customer | $ 139,314 | |||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 28.30% | |||
Health Care Organization, Revenue | $ 140,381 | [1] | $ 129,920 | |
Revenue by payor as a percent of total revenue | 28.00% | 29.40% | ||
Medicaid — skilled | ||||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||||
Revenue from Contract with Customer | $ 27,042 | |||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 5.50% | |||
Health Care Organization, Revenue | $ 27,538 | [1] | $ 23,017 | |
Revenue by payor as a percent of total revenue | 5.50% | 5.20% | ||
Total Medicaid and Medicare | ||||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||||
Revenue from Contract with Customer | $ 333,981 | |||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 67.90% | |||
Health Care Organization, Revenue | $ 338,228 | [1] | $ 301,208 | |
Revenue by payor as a percent of total revenue | 67.50% | 68.20% | ||
Managed care | ||||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||||
Revenue from Contract with Customer | $ 83,716 | |||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 17.00% | |||
Health Care Organization, Revenue | $ 85,845 | [1] | $ 75,562 | |
Revenue by payor as a percent of total revenue | 17.10% | 17.10% | ||
Private and other payors(1) | ||||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||||
Revenue from Contract with Customer | [2] | $ 74,437 | ||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 15.10% | |||
Health Care Organization, Revenue | [2] | $ 76,865 | [1] | $ 64,969 |
Revenue by payor as a percent of total revenue | 15.40% | 14.70% | ||
[1] | The 2018 pro forma results reflect balances assuming previous accounting guidance was still in effect. | |||
[2] | Private and other payors also includes revenue from all payors generated in other ancillary services for the three months ended March 31, 2018 and 2017. |
Revenue and Accounts Receivab49
Revenue and Accounts Receivable Contract Balances (Details) | Mar. 31, 2018USD ($) |
REVENUE AND ACCOUNTS RECEIVABLE [Abstract] | |
Contract with Customer, Liability, Current | $ 0 |
Revenue and Accounts Receivab50
Revenue and Accounts Receivable Accounts Receivable (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts Receivable, Gross | $ 260,271 | ||
Less: allowance for doubtful accounts | (1,762) | $ (43,961) | |
Accounts receivable, net | 258,509 | ||
Medicaid | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts Receivable, Gross | 99,799 | ||
Managed care | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts Receivable, Gross | 59,358 | ||
Medicare | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts Receivable, Gross | 49,765 | ||
Private Pay and Other | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts Receivable, Gross | 51,349 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts Receivable, Gross | 304,718 | [1] | 309,029 |
Less: allowance for doubtful accounts | (46,209) | [1] | (43,961) |
Accounts receivable, net | 258,509 | [1] | 265,068 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Medicaid | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts Receivable, Gross | 112,419 | [1] | 119,441 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Managed care | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts Receivable, Gross | 71,955 | [1] | 68,930 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Medicare | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts Receivable, Gross | 55,361 | [1] | 55,667 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Private Pay and Other | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts Receivable, Gross | $ 64,983 | [1] | $ 64,991 |
[1] | The 2018 pro forma results reflect balances assuming previous accounting guidance was still in effect. |
Computation of Net Income Per51
Computation of Net Income Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Numerator: | |||
Net income | $ 23,293 | $ 2,956 | |
Less: net income attributable to noncontrolling interests | 161 | 116 | |
Net income attributable to The Ensign Group, Inc. | $ 23,132 | $ 2,840 | |
Denominator: | |||
Weighted average shares outstanding for basic net income per share | 51,585 | 50,767 | |
Adjusted weighted average common shares outstanding | 53,518 | 52,633 | |
Basic net income (loss) per common share: | |||
Basic net income per common share attributable to The Ensign Group, Inc. | $ 0.45 | $ 0.06 | |
Diluted net (loss) income per common share: | |||
Diluted net income per common share attributable to The Ensign Group, Inc. | $ 0.43 | $ 0.05 | |
Common Class A [Member] | |||
Denominator: | |||
Weighted average shares outstanding for basic net income per share | 51,585 | 50,767 | |
Plus: incremental shares from assumed conversion (1) | [1] | 1,933 | 1,866 |
[1] | Options outstanding which are anti-dilutive and therefore not factored into the weighted average common shares amount above were 937 and 1,272 for the three months ended March 31, 2018 and 2017, respectively. |
Computation of Net Income Per52
Computation of Net Income Per Common Share Antidilutive Shares (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Earnings Per Share, Diluted, Other Disclosures [Abstract] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 937 | 1,272 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Cash and cash equivalents - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Level 1 | ||
Cash and cash equivalents | $ 35,057 | $ 42,337 |
Level 2 | ||
Cash and cash equivalents | 0 | 0 |
Level 3 | ||
Cash and cash equivalents | $ 0 | $ 0 |
Fair Value Measurements Investm
Fair Value Measurements Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Domestic Corporate Debt Securities [Member] | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Held-to-maturity Securities | $ 41,696 | $ 41,777 |
Business Segments (Details)
Business Segments (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018USD ($)Segmentsbusinessfacilities | Mar. 31, 2017USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of Reportable Segments | Segments | 3 | |
Transitional and Skilled Service Facilities | facilities | 160 | |
Transitional and Skilled Services and Assistant and Independent Living Campuses | facilities | 21 | |
Assisted and Independent Living Facilities | facilities | 51 | |
Home Health, Hospice and Home Care Operations | business | 46 | |
Business Exit Costs | $ 0 | $ 4,017 |
Gain (Loss) on Contract Termination | 2,715 | |
Impairment of Long-Lived Assets to be Disposed of | $ 155 | 111 |
Contract Termination and Facility Closing [Member] | ||
Segment Reporting Information [Line Items] | ||
Business Exit Costs | $ 4,017 |
Business Segments Revenue by Se
Business Segments Revenue by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||
Mar. 31, 2018 | Mar. 31, 2017 | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 492,134 | ||||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 100.00% | ||||
Health Care Organization, Revenue | $ 500,938 | [1] | $ 441,739 | ||
Revenue by payor as a percent of total revenue | 100.00% | 100.00% | |||
Transitional and Skilled Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 407,016 | ||||
Health Care Organization, Revenue | 415,221 | $ 372,339 | [2] | ||
Assisted and Independent Living Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 36,113 | 32,346 | [2] | ||
Home Health and Hospice Services | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 39,758 | ||||
Health Care Organization, Revenue | 40,357 | 32,133 | |||
All Other | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 9,247 | 4,921 | |||
Medicaid | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 167,625 | ||||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 34.10% | ||||
Health Care Organization, Revenue | $ 170,309 | [1] | $ 148,271 | ||
Revenue by payor as a percent of total revenue | 34.00% | 33.60% | |||
Medicaid | Transitional and Skilled Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 156,511 | ||||
Health Care Organization, Revenue | 159,104 | $ 138,825 | |||
Medicaid | Assisted and Independent Living Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 8,264 | 7,036 | |||
Medicaid | Home Health and Hospice Services | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 2,850 | ||||
Health Care Organization, Revenue | 2,941 | 2,410 | |||
Medicaid | All Other | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 0 | 0 | |||
Medicare | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 139,314 | ||||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 28.30% | ||||
Health Care Organization, Revenue | $ 140,381 | [1] | $ 129,920 | ||
Revenue by payor as a percent of total revenue | 28.00% | 29.40% | |||
Medicare | Transitional and Skilled Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 111,953 | ||||
Health Care Organization, Revenue | 112,777 | $ 107,928 | |||
Medicare | Assisted and Independent Living Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 0 | 0 | |||
Medicare | Home Health and Hospice Services | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 27,361 | ||||
Health Care Organization, Revenue | 27,604 | 21,992 | |||
Medicare | All Other | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 0 | 0 | |||
Medicaid — skilled | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 27,042 | ||||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 5.50% | ||||
Health Care Organization, Revenue | $ 27,538 | [1] | $ 23,017 | ||
Revenue by payor as a percent of total revenue | 5.50% | 5.20% | |||
Medicaid — skilled | Transitional and Skilled Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 27,042 | ||||
Health Care Organization, Revenue | 27,538 | $ 23,017 | |||
Medicaid — skilled | Assisted and Independent Living Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 0 | 0 | |||
Medicaid — skilled | Home Health and Hospice Services | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 0 | ||||
Health Care Organization, Revenue | 0 | 0 | |||
Medicaid — skilled | All Other | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 0 | 0 | |||
Total Medicaid and Medicare | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 333,981 | ||||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 67.90% | ||||
Health Care Organization, Revenue | $ 338,228 | [1] | $ 301,208 | ||
Revenue by payor as a percent of total revenue | 67.50% | 68.20% | |||
Total Medicaid and Medicare | Transitional and Skilled Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 295,506 | ||||
Health Care Organization, Revenue | 299,419 | $ 269,770 | |||
Total Medicaid and Medicare | Assisted and Independent Living Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 8,264 | 7,036 | |||
Total Medicaid and Medicare | Home Health and Hospice Services | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 30,211 | ||||
Health Care Organization, Revenue | 30,545 | 24,402 | |||
Total Medicaid and Medicare | All Other | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 0 | 0 | |||
Managed care | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 83,716 | ||||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 17.00% | ||||
Health Care Organization, Revenue | $ 85,845 | [1] | $ 75,562 | ||
Revenue by payor as a percent of total revenue | 17.10% | 17.10% | |||
Managed care | Transitional and Skilled Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 77,800 | ||||
Health Care Organization, Revenue | 79,698 | $ 70,357 | |||
Managed care | Assisted and Independent Living Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 0 | 0 | |||
Managed care | Home Health and Hospice Services | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 5,916 | ||||
Health Care Organization, Revenue | 6,147 | 5,205 | |||
Managed care | All Other | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 0 | 0 | |||
Private and other payors(1) | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | [3] | $ 74,437 | |||
Revenue from Contract with Customer by Payor as a Percent of Total Revenue | 15.10% | ||||
Health Care Organization, Revenue | [3] | $ 76,865 | [1] | $ 64,969 | |
Revenue by payor as a percent of total revenue | 15.40% | 14.70% | |||
Private and other payors(1) | Transitional and Skilled Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 33,710 | ||||
Health Care Organization, Revenue | 36,104 | $ 32,212 | |||
Private and other payors(1) | Assisted and Independent Living Services Segment | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 27,849 | 25,310 | |||
Private and other payors(1) | Home Health and Hospice Services | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | 3,631 | ||||
Health Care Organization, Revenue | 3,665 | 2,526 | |||
Private and other payors(1) | All Other | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Revenue from Contract with Customer | $ 9,247 | $ 4,921 | |||
[1] | The 2018 pro forma results reflect balances assuming previous accounting guidance was still in effect. | ||||
[2] | The Company's campuses represent facilities that offer skilled nursing, assisted and/or independent living services. Revenue and expenses related to skilled nursing, assisted and independent living services have been allocated and recorded in the respective reportable segment. Due to the adoption of ASC 606, the presentation of revenue changed from presenting total revenue to service revenue and assisted and independent living revenue. | ||||
[3] | Private and other payors also includes revenue from all payors generated in other ancillary services for the three months ended March 31, 2018 and 2017. |
Business Segments Schedule of S
Business Segments Schedule of Segment Reporting Information, by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | |||
Segment Reporting Information [Line Items] | ||||
Service revenue | $ 456,021 | $ 409,393 | ||
Service revenue, pro forma | 464,825 | |||
Assisted and independent living revenue | 36,113 | 32,346 | ||
Revenue from external customers | 492,134 | |||
Revenue from external customers, pro forma | 500,938 | [1] | 441,739 | |
Intersegment revenue (1) | 0 | 0 | ||
Total revenue | 492,134 | |||
Total revenue, pro forma | 500,938 | 441,739 | ||
Segment income (loss) (2) | 32,979 | 7,552 | ||
Interest expense, net of interest income | (3,165) | (3,155) | ||
Income before provision for income taxes | 29,814 | 4,397 | ||
Depreciation and amortization | 11,622 | 10,514 | ||
Transitional and Skilled Services Segment | ||||
Segment Reporting Information [Line Items] | ||||
Service revenue | 407,016 | 372,339 | [2] | |
Service revenue, pro forma | 415,221 | |||
Assisted and independent living revenue | 0 | 0 | [2] | |
Revenue from external customers | 407,016 | |||
Revenue from external customers, pro forma | 415,221 | 372,339 | [2] | |
Intersegment revenue (1) | 689 | 744 | [3] | |
Total revenue | 407,705 | |||
Total revenue, pro forma | 415,910 | 373,083 | ||
Segment income (loss) (2) | 46,195 | 31,790 | [4] | |
Depreciation and amortization | 7,802 | 6,953 | ||
Assisted and Independent Living Services Segment | ||||
Segment Reporting Information [Line Items] | ||||
Service revenue | 0 | 0 | [2] | |
Assisted and independent living revenue | 36,113 | 32,346 | [2] | |
Revenue from external customers | 36,113 | 32,346 | [2] | |
Intersegment revenue (1) | 0 | 0 | [3] | |
Total revenue | 36,113 | 32,346 | ||
Segment income (loss) (2) | 4,662 | 4,439 | [4] | |
Depreciation and amortization | 1,597 | 1,623 | ||
Home Health and Hospice Services | ||||
Segment Reporting Information [Line Items] | ||||
Service revenue | 39,758 | 32,133 | ||
Service revenue, pro forma | 40,357 | |||
Assisted and independent living revenue | 0 | 0 | ||
Revenue from external customers | 39,758 | |||
Revenue from external customers, pro forma | 40,357 | 32,133 | ||
Intersegment revenue (1) | 0 | 0 | [3] | |
Total revenue | 39,758 | |||
Total revenue, pro forma | 40,357 | 32,133 | ||
Segment income (loss) (2) | 6,058 | 4,294 | [4] | |
Depreciation and amortization | 245 | 235 | ||
All Other | ||||
Segment Reporting Information [Line Items] | ||||
Service revenue | 9,247 | 4,921 | ||
Assisted and independent living revenue | 0 | 0 | ||
Revenue from external customers | 9,247 | 4,921 | ||
Intersegment revenue (1) | 1,082 | 884 | [3] | |
Total revenue | 10,329 | 5,805 | ||
Segment income (loss) (2) | (23,936) | (32,971) | [4] | |
Depreciation and amortization | 1,978 | 1,703 | ||
Elimination | ||||
Segment Reporting Information [Line Items] | ||||
Intersegment revenue (1) | (1,771) | (1,628) | [3] | |
Total revenue | $ (1,771) | $ (1,628) | ||
[1] | The 2018 pro forma results reflect balances assuming previous accounting guidance was still in effect. | |||
[2] | The Company's campuses represent facilities that offer skilled nursing, assisted and/or independent living services. Revenue and expenses related to skilled nursing, assisted and independent living services have been allocated and recorded in the respective reportable segment. Due to the adoption of ASC 606, the presentation of revenue changed from presenting total revenue to service revenue and assisted and independent living revenue. | |||
[3] | Intersegment revenue represents services provided at the Company's operating subsidiaries to the Company's other business lines. | |||
[4] | Segment income (loss) includes depreciation and amortization expense and excludes general and administrative expense and interest expense for transitional and skilled services, assisted and independent living services and home health and hospice services segments. General and administrative expense, including charges related to class action lawsuit during the three months ended March 31, 2017, is included in the "All Other" category. |
Acquisitions Acquisition Summar
Acquisitions Acquisition Summary (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | |
May 01, 2018USD ($)OperationsBeds | Mar. 31, 2018USD ($)OperationsBeds | Mar. 31, 2017USD ($) | |
Business Acquisition [Line Items] | |||
Cash payments for asset acquisitions | $ | $ (4,447) | $ (310) | |
Payments to Acquire Businesses, Gross | $ | $ 8,693 | ||
Operational Skilled Nursing Beds | 18,900 | ||
Operational Assisted Living Units | 5,100 | ||
Assisted Living Facility [Member] | |||
Business Acquisition [Line Items] | |||
Number of Businesses Acquired | Operations | 2 | ||
Operational Assisted Living Units | 74 | ||
Subsequent Event [Member] | 8060 Services, Hospitals [Member] | |||
Business Acquisition [Line Items] | |||
Long-term Acute Care Hospital Beds | 50 | ||
Subsequent Event [Member] | 8051 Services, Skilled Nursing Care Facilities [Member] | |||
Business Acquisition [Line Items] | |||
Number of Businesses Acquired | Operations | 1 | ||
Operational Skilled Nursing Beds | 253 | ||
Subsequent Event [Member] | Skilled Nursing, Assisted Living and Independent Living Facilities [Member] | |||
Business Acquisition [Line Items] | |||
Payments to Acquire Businesses, Gross | $ | $ 19,500 | ||
Subsequent Event [Member] | Assisted Living and Independent Living Facility [Member] [Member] | |||
Business Acquisition [Line Items] | |||
Operational Assisted Living and Independent Living Units | 143 | ||
Subsequent Event [Member] | Transitional and Skilled Services and Assisted and Independent Campuses [Member] | |||
Business Acquisition [Line Items] | |||
Number of Businesses Acquired | Operations | 1 |
Acquisitions (Details)
Acquisitions (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Business Acquisition [Line Items] | |
Payments to Acquire Businesses, Gross | $ 8,693 |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 25 |
Building and improvements | |
Business Acquisition [Line Items] | |
Payments to Acquire Businesses, Gross | 5,290 |
Equipment, furniture, and fixtures | |
Business Acquisition [Line Items] | |
Payments to Acquire Businesses, Gross | 449 |
Assembled occupancy | |
Business Acquisition [Line Items] | |
Payments to Acquire Businesses, Gross | 59 |
Goodwill | |
Business Acquisition [Line Items] | |
Payments to Acquire Businesses, Gross | 1,826 |
Other indefinite-lived intangible assets | |
Business Acquisition [Line Items] | |
Payments to Acquire Businesses, Gross | $ 1,094 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 696,075 | $ 681,177 |
Less: accumulated depreciation | (155,056) | (144,093) |
Property and equipment, net | 541,019 | 537,084 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 49,382 | 49,081 |
Building and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 348,977 | 342,641 |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 185,342 | 181,530 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 5,268 | 5,244 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 99,511 | 97,221 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 7,595 | $ 5,460 |
Intangible Assets - Net (Detail
Intangible Assets - Net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2017 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | $ 43,972 | $ 43,924 |
Accumulated Amortization | (11,736) | (11,121) |
Intangible assets, net | $ 32,236 | 32,803 |
Lease acquisition costs | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 24 years | |
Finite-Lived Intangible Assets, Gross | $ 483 | 483 |
Accumulated Amortization | (104) | (99) |
Intangible assets, net | $ 379 | 384 |
Favorable leases | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 30 years 2 months | |
Finite-Lived Intangible Assets, Gross | $ 35,116 | 35,116 |
Accumulated Amortization | (7,063) | (6,568) |
Intangible assets, net | $ 28,053 | 28,548 |
Assembled occupancy | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 4 months 30 days | |
Finite-Lived Intangible Assets, Gross | $ 2,707 | 2,659 |
Accumulated Amortization | (2,671) | (2,631) |
Intangible assets, net | $ 36 | 28 |
Trade name | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 30 years | |
Finite-Lived Intangible Assets, Gross | $ 733 | 733 |
Accumulated Amortization | (299) | (293) |
Intangible assets, net | $ 434 | 440 |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 17 years 3 months | |
Finite-Lived Intangible Assets, Gross | $ 4,933 | 4,933 |
Accumulated Amortization | (1,599) | (1,530) |
Intangible assets, net | $ 3,334 | $ 3,403 |
Intangible Assets - Net Additio
Intangible Assets - Net Additional Disclosures (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of Intangible Assets | $ 615 | $ 611 |
Intangible Assets - Net Future
Intangible Assets - Net Future Amortization (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2018 (remainder) | $ 1,762 | |
2,019 | 2,301 | |
2,020 | 1,593 | |
2,021 | 1,497 | |
2,022 | 1,471 | |
2,023 | 1,409 | |
Thereafter | 22,203 | |
Intangible assets, net | $ 32,236 | $ 32,803 |
Goodwill and Other Indefinite64
Goodwill and Other Indefinite-Lived Intangible Assets Goodwill Rollforward (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Goodwill [Line Items] | |
January 1 | $ 81,062 |
Purchase price adjustment | (99) |
March 31 | 80,963 |
Transitional and Skilled Services Segment | |
Goodwill [Line Items] | |
January 1 | 45,486 |
Purchase price adjustment | 0 |
March 31 | 45,486 |
Assisted and Independent Living Services Segment | |
Goodwill [Line Items] | |
January 1 | 3,958 |
Purchase price adjustment | 0 |
March 31 | 3,958 |
Home Health and Hospice Services | |
Goodwill [Line Items] | |
January 1 | 24,322 |
Purchase price adjustment | 0 |
March 31 | 24,322 |
All Other | |
Goodwill [Line Items] | |
January 1 | 7,296 |
Purchase price adjustment | (99) |
March 31 | $ 7,197 |
Goodwill and Other Indefinite65
Goodwill and Other Indefinite-Lived Intangible Assets Indefinite-lived intangble assets (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Indefinite-lived Intangible Assets [Line Items] | ||
Other indefinite-lived intangibles | $ 25,249 | $ 25,249 |
Home Health and Hospice Services | Trade name | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Other indefinite-lived intangibles | 1,181 | 1,181 |
Home Health and Hospice Services | Medicare and Medicaid licenses | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Other indefinite-lived intangibles | $ 24,068 | $ 24,068 |
Restricted and Other Assets (De
Restricted and Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Other Assets [Abstract] | ||
Debt issuance costs, net | $ 2,568 | $ 2,799 |
Long-term insurance losses recoverable asset | 5,278 | 5,394 |
Deposits with landlords | 7,205 | 5,981 |
Capital improvement reserves with landlords and lenders | 2,535 | 2,327 |
Note receivable from sale of ancillary business | 109 | 0 |
Restricted and other assets | $ 17,695 | $ 16,501 |
Other Accrued Liabilities (Deta
Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Accrued Liabilities [Abstract] | ||
Quality assurance fee | $ 4,908 | $ 4,864 |
Refunds payable | 22,971 | 21,661 |
Deferred revenue | 6,251 | 7,066 |
Cash held in trust for patients | 2,660 | 2,609 |
Resident deposits | 6,841 | 6,574 |
Dividends payable | 2,346 | 2,328 |
Property taxes | 8,409 | 10,088 |
Operational closure liability | 900 | 910 |
Other | 7,802 | 7,715 |
Other accrued liabilities | $ 63,088 | $ 63,815 |
Income Taxes Expense (Details)
Income Taxes Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Provision for income taxes | $ 6,521 | $ 1,441 |
Effective Income Tax Rate Reconciliation, Percent | 21.90% | 32.80% |
Income Taxes Other Disclosures
Income Taxes Other Disclosures (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Operating Loss Carryforwards [Line Items] | |
Income Tax Expense (Benefit), Continuing Operations, Adjustment of Deferred Tax (Asset) Liability | $ 0 |
Debt (Details)
Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Long-term Debt, Gross | $ 293,597 | $ 316,019 |
Current maturities of long-term debt | (10,035) | (9,939) |
Long Term Debt, net of Current Maturities and Debt Discount | 280,449 | 302,990 |
SunTrust Bank [Member] | Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Credit facility with SunTrust | 30,000 | 50,000 |
Second Amended Credit Facility [Member] | SunTrust Bank [Member] | Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Term loan with SunTrust, interest payable quarterly | 138,750 | 140,625 |
Less: debt issuance costs | (3,113) | (3,090) |
Collateralized Debt Obligations [Member] | Notes Payable, Other Payables [Member] | ||
Debt Instrument [Line Items] | ||
Mortgage loans and promissory note, principal and interest payable monthly, interest at fixed rate | $ 124,847 | $ 125,394 |
Debt Additional Disclosures (De
Debt Additional Disclosures (Details) $ in Thousands | Feb. 05, 2016USD ($)Rate | May 30, 2014USD ($)Rate | Apr. 27, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jul. 19, 2016USD ($)Rate |
Secured Debt [Member] | Senior Debt Obligations [Member] | ||||||
Long-Term Debt Additional Disclosures [Line Items] | ||||||
Pledged Financial Instruments, Not Separately Reported, Securities for Letter of Credit Facilities | $ 6,304 | |||||
SunTrust Bank [Member] | Revolving Credit Facility [Member] | ||||||
Long-Term Debt Additional Disclosures [Line Items] | ||||||
Credit facility with SunTrust | 30,000 | $ 50,000 | ||||
Line of Credit Facility, Current Borrowing Capacity | $ 250,000 | $ 150,000 | ||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 150,000 | $ 75,000 | ||||
Total Net Debt Ratio, Maximum | 3.50 | |||||
Total Net Debt Ratio, Minimum | 1.50 | |||||
EBITDA Ratio, Maximum | 1 | |||||
EBITDA Ratio, Minimum | 1 | |||||
Total Net Debt Ratio, Default | 2.75 | |||||
EBITDA Ratio, Default | 1 | |||||
Aggregate Revolving Commitment Percentage | Rate | 10.00% | |||||
Total Net Debt Ratio, Cured | 2.75 | |||||
EBITDA Ratio, Cured | 1 | |||||
SunTrust Bank [Member] | Revolving Credit Facility [Member] | Second Amended Credit Facility [Member] | ||||||
Long-Term Debt Additional Disclosures [Line Items] | ||||||
Term Loan, Amount Outstanding, Current | 7,500 | |||||
Term Loan, Amount Outstanding, Noncurrent | 131,250 | |||||
Line of Credit Facility, Current Borrowing Capacity | $ 450,000 | |||||
Long-term Line of Credit | 300,000 | |||||
Term Loan, Borrowing Capacity | $ 150,000 | |||||
Line of Credit Facility, Interest Rate at Period End | Rate | 5.00% | |||||
Term loan with SunTrust, interest payable quarterly | 138,750 | $ 140,625 | ||||
Term Loan and Line of Credit Facility, Amount Outstanding | $ 168,750 | |||||
SunTrust Bank [Member] | Revolving Credit Facility [Member] | Subsequent Event [Member] | Second Amended Credit Facility [Member] | ||||||
Long-Term Debt Additional Disclosures [Line Items] | ||||||
Term Loan and Line of Credit Facility, Amount Outstanding | $ 158,750 | |||||
SunTrust Bank [Member] | Revolving Credit Facility [Member] | Minimum [Member] | ||||||
Long-Term Debt Additional Disclosures [Line Items] | ||||||
Line of Credit Facility, Interest Rate, Additional Margin | Rate | 0.75% | 1.25% | ||||
Line of Credit Facility, Interest Rate, LIBOR | Rate | 1.75% | 2.25% | ||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | Rate | 0.30% | 0.30% | ||||
SunTrust Bank [Member] | Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Long-Term Debt Additional Disclosures [Line Items] | ||||||
Line of Credit Facility, Interest Rate, Additional Margin | Rate | 1.75% | 2.25% | ||||
Line of Credit Facility, Interest Rate, LIBOR | Rate | 2.75% | 3.25% | ||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | Rate | 0.50% | 0.50% |
Debt Other Additional Disclosur
Debt Other Additional Disclosures (Details) - Collateralized Debt Obligations [Member] $ in Thousands | Dec. 31, 2014 | Dec. 27, 2017USD ($)facilitiesRate | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016Rate |
Mortgages [Member] | |||||
Debt Instrument [Line Items] | |||||
Number of Operating Subsidiaries | facilities | 17 | ||||
Prepayment Penalty Reduced Rate During First Three Years | 10.00% | ||||
Prepayment Penalty Reduced Rate During the Fourth Year | 3.00% | ||||
Prepayment Penalty Reduced Rate for the Fifth through Tenth Years | 1.00% | ||||
Prepayment penalty reduced rate | 1.00% | ||||
Notes Payable | $ | $ 112,000 | ||||
Mortgages [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, pre-payment fee reduction, term | 3 years | 5 years | |||
Debt Instrument, Term | 12 years | 30 years | |||
Mortgages [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, pre-payment fee reduction, term | 11 years | 10 years | |||
Debt Instrument, Term | 33 years | 35 years | |||
Notes Payable, Other Payables [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes Payable | $ | $ 124,847 | $ 125,394 | |||
Notes Payable, Current | $ | 2,535 | ||||
Notes Payable, Noncurrent | $ | $ 122,312 | ||||
Notes Payable to Banks [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 3.30% | ||||
Notes Payable to Banks [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 2.60% | ||||
Notes Payable to Banks [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 5.30% |
Options and Awards Lead Paragra
Options and Awards Lead Paragraphs (Details) shares in Thousands | May 25, 2017shares | Mar. 31, 2018Agreementsshares | Mar. 31, 2017shares |
Stock Options granted [Line Items] | |||
Number of Option Plans | Agreements | 1 | ||
Stock Issued or Granted During Period, Share-based Compensation [Abstract] | |||
Award Vesting Period | 5 years | ||
Options Granted | 168 | 156 | |
Nonvested Restricted Awards, Granted | 57 | 53 | |
2017 Plan [Member] | |||
Stock Issued or Granted During Period, Share-based Compensation [Abstract] | |||
Number of Shares Available for Grant | 5,994 | ||
Number of Shares Authorized | 6,881 | ||
Conversion to Reduce Shares Availability | 1 | ||
Other than Options, Conversion to Reduce Shares Availability | 2.5 | ||
Award Vesting Period | 5 years | ||
Award Vesting Rights, Percentage | 20.00% | ||
Expiration Period | 10 years | ||
2017 Plan [Member] | Director [Member] | |||
Stock Issued or Granted During Period, Share-based Compensation [Abstract] | |||
Award Vesting Period | 3 years | ||
Award Requisite Service Period | 3 years |
Options and Awards Valuation As
Options and Awards Valuation Assumptions (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Fair Value Assumptions and Methodology | ||
Options Granted | 168 | 156 |
Weighted Average Risk-Free Rate | 2.70% | 2.00% |
Expected Life | 6 years 2 months | 6 years 4 months |
Weighted Average Volatility | 32.00% | 36.00% |
Weighted Average Dividend Yield | 0.70% | 0.80% |
Options and Awards Exercise Pri
Options and Awards Exercise Price and Fair Value (Details) - $ / shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures [Abstract] | ||
Options Granted | 168 | 156 |
Weighted Average Exercise Price | $ 26.53 | $ 20.28 |
Weighted Average Fair Value of Options | 9.01 | 7.15 |
Intrinsic Value of Options Granted on Grant Date [Abstract] | ||
Grant Date Intrinsic Value | $ 0 | $ 0 |
Options and Awards Options Outs
Options and Awards Options Outstanding Rollforward (Details) - $ / shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Options outstanding January 1, | 4,739 | |
Weighted average exercise price January 1, | $ 13.08 | |
Options vested January 1, | 2,776 | |
Weighted Average Exercise Price of Options Vested January 1, | $ 10.07 | |
Options Granted | 168 | 156 |
Weighted Average Exercise Price, Options Granted | $ 26.53 | $ 20.28 |
Options Forfeited in Period | (26) | |
Weighted Average Exercise Price, Options Forfeited in Period | $ 16.13 | |
Options Exercised in Period | (355) | |
Weighted Average Exercise Price, Options Exercised in Period | $ 7.70 | |
Options outstanding March 31, | 4,526 | |
Weighted average exercise price March 31, | $ 13.98 | |
Options vested March 31, | 2,638 | |
Weighted Average Exercise Price of Options Vested March 31, | $ 10.69 |
Options and Awards Options Ou77
Options and Awards Options Outstanding by Exercise Price (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended |
Mar. 31, 2018USD ($)$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number of Outstanding Options | 4,526 |
Black-Scholes Fair Value | $ | $ 25,887 |
Stock Options Vested and Exercisable | 2,638 |
2,008 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 2.56 |
Exercise Price, Upper Range Limit | $ / shares | $ 4.06 |
Number of Outstanding Options | 65 |
Black-Scholes Fair Value | $ | $ 107 |
Remaining Contractual Life (Years) | 0 years |
Stock Options Vested and Exercisable | 65 |
2,009 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 4.06 |
Exercise Price, Upper Range Limit | $ / shares | $ 4.56 |
Number of Outstanding Options | 398 |
Black-Scholes Fair Value | $ | $ 858 |
Remaining Contractual Life (Years) | 1 year |
Stock Options Vested and Exercisable | 398 |
2,010 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 4.77 |
Exercise Price, Upper Range Limit | $ / shares | $ 4.96 |
Number of Outstanding Options | 88 |
Black-Scholes Fair Value | $ | $ 215 |
Remaining Contractual Life (Years) | 2 years |
Stock Options Vested and Exercisable | 88 |
2,011 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 5.90 |
Exercise Price, Upper Range Limit | $ / shares | $ 7.99 |
Number of Outstanding Options | 107 |
Black-Scholes Fair Value | $ | $ 366 |
Remaining Contractual Life (Years) | 3 years |
Stock Options Vested and Exercisable | 107 |
2,012 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 6.56 |
Exercise Price, Upper Range Limit | $ / shares | $ 7.96 |
Number of Outstanding Options | 378 |
Black-Scholes Fair Value | $ | $ 1,391 |
Remaining Contractual Life (Years) | 4 years |
Stock Options Vested and Exercisable | 378 |
2,013 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 7.98 |
Exercise Price, Upper Range Limit | $ / shares | $ 11.49 |
Number of Outstanding Options | 504 |
Black-Scholes Fair Value | $ | $ 2,448 |
Remaining Contractual Life (Years) | 5 years |
Stock Options Vested and Exercisable | 429 |
2,014 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 10.55 |
Exercise Price, Upper Range Limit | $ / shares | $ 18.94 |
Number of Outstanding Options | 1,383 |
Black-Scholes Fair Value | $ | $ 7,848 |
Remaining Contractual Life (Years) | 6 years |
Stock Options Vested and Exercisable | 807 |
2,015 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 21.47 |
Exercise Price, Upper Range Limit | $ / shares | $ 25.24 |
Number of Outstanding Options | 530 |
Black-Scholes Fair Value | $ | $ 4,829 |
Remaining Contractual Life (Years) | 7 years |
Stock Options Vested and Exercisable | 231 |
2,016 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 18.79 |
Exercise Price, Upper Range Limit | $ / shares | $ 19.89 |
Number of Outstanding Options | 438 |
Black-Scholes Fair Value | $ | $ 3,053 |
Remaining Contractual Life (Years) | 8 years |
Stock Options Vested and Exercisable | 109 |
2,017 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 18.64 |
Exercise Price, Upper Range Limit | $ / shares | $ 22.90 |
Number of Outstanding Options | 467 |
Black-Scholes Fair Value | $ | $ 3,263 |
Remaining Contractual Life (Years) | 9 years |
Stock Options Vested and Exercisable | 26 |
2,018 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, Lower Range Limit | $ / shares | $ 26.53 |
Number of Outstanding Options | 168 |
Black-Scholes Fair Value | $ | $ 1,509 |
Remaining Contractual Life (Years) | 10 years |
Stock Options Vested and Exercisable | 0 |
Options and Awards Restricted A
Options and Awards Restricted Awards Granted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Restricted awards granted [Line Items] | ||
Restricted Awards Grant Date Fair Value Range, Minimum | $ 23.61 | $ 18.56 |
Restricted Awards Grant Date Fair Value Range, Maximum | $ 27.70 | $ 20.68 |
Share-based Compensation, Restricted Awards, Exercise Price | $ 0 | |
Issuance of restricted stock to employees (in shares) | 57 | 53 |
Award Vesting Period | 5 years | |
Director [Member] | ||
Restricted awards granted [Line Items] | ||
Restricted Awards Grant Date Fair Value Range, Minimum | $ 23.61 | |
Options Granted to Non-employee Directors | 8 |
Options and Awards Restricted79
Options and Awards Restricted Award Rollforward (Details) - $ / shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Restricted Stock Rollforward [Line Items] | ||
Nonvested Restricted Awards, Nonvested at January 1, | 383 | |
Weighted Average Grant Date Fair Value, Nonvested at January 1, | $ 20.65 | |
Nonvested Restricted Awards, Granted | 57 | 53 |
Weighted Average Grant Date Fair Value, Restricted Awards Granted in the Period | $ 26.28 | |
Nonvested Restricted Awards, Vested in the Period | (48) | |
Weighted Average Grant Date Fair Value, Restricted Awards Vested in the Period | $ 20.59 | |
Nonvested Restricted Awards, Forfeited in the Period | (5) | |
Weighted Average Grant Date Fair Value, Restricted Awards Forfeited in the Period | $ 22.04 | |
Nonvested Restricted Awards, Nonvested at March 31, | 387 | |
Weighted Average Grant Date Fair Value, Nonvested at March 31, | $ 21.47 |
Options and Awards Compensation
Options and Awards Compensation Expense (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 1,971 | $ 1,891 |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized [Abstract] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 5 years 10 months 15 days | |
Stock Options | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 1,216 | 1,207 |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized [Abstract] | ||
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized | $ 11,210 | |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition | 3 years | |
Employee Service Share-based Compensation, Nonvested Awards | 1,888 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Expected to Vest, Number | 1,785 | |
Restricted Stock Awards | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 578 | 552 |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized [Abstract] | ||
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized | $ 7,363 | |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition | 3 years 5 months 15 days | |
Stock awards | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 177 | $ 132 |
Options and Awards Intrinsic Va
Options and Awards Intrinsic Values (Details) - Stock Options - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Outstanding | $ 55,792 | $ 44,060 |
Vested | 41,182 | 33,976 |
Expected to Vest | 13,237 | 9,311 |
Exercised | $ 6,356 | $ 10,481 |
Options and Awards Subsidiary E
Options and Awards Subsidiary Equity Plan (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award Vesting Period | 5 years | |
Employee stock award compensation | $ 1,971 | $ 1,891 |
Subsidiaries [Member] | Subsidiaries Stock awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award Vesting Period | 5 years | |
Employee stock award compensation | $ 338 | $ 333 |
Common Stock Required to Settle Subsidiary Shares | 223 | 251 |
Leases (Details)
Leases (Details) $ in Thousands | Jun. 01, 2014facilitiesRenewals | Mar. 31, 2018USD ($)facilitiesRenewals | Mar. 31, 2017USD ($) |
Operating Leased Assets [Line Items] | |||
Operating Leases, Rent Expense | $ | $ 34,164 | $ 31,992 | |
Facilities under Master Lease Arrangement | 29 | ||
Master Lease Agreements | 5 | ||
Various Landlords [Member] [Member] | |||
Operating Leased Assets [Line Items] | |||
Lessee, Operating Lease, Term of Contract | 15 years | ||
Lessee Leasing Arrangements, Operating Leases, Number of Renewal Terms | Renewals | 2 | ||
Lessee, Operating Lease, Renewal Term | 5 years | ||
CareTrust REIT [Member] | |||
Operating Leased Assets [Line Items] | |||
Skilled Nursing, Assisted Living and Independent Living Facilities | 92 | ||
Operating Leases of Lessee, Contingent Rentals, Description of Variable Rate Basis | 0.025 | ||
Payments for Rent | $ | $ 14,418 | $ 14,116 | |
Lessee, Operating Lease, Renewal Term | 5 years | ||
Master Lease Agreements | 8 | ||
Minimum [Member] | Various Landlords [Member] [Member] | |||
Operating Leased Assets [Line Items] | |||
Lessee, Operating Lease, Term of Contract | 5 years | ||
Average Term of Non-Cancellable Equipment Leases | 3 years | ||
Minimum [Member] | CareTrust REIT [Member] | |||
Operating Leased Assets [Line Items] | |||
Lessee, Operating Lease, Term of Contract | 12 years | ||
Lessee Leasing Arrangements, Operating Leases, Number of Renewal Terms | Renewals | 2 | ||
Maximum [Member] | Various Landlords [Member] [Member] | |||
Operating Leased Assets [Line Items] | |||
Lessee, Operating Lease, Term of Contract | 20 years | ||
Average Term of Non-Cancellable Equipment Leases | 5 years | ||
Maximum [Member] | CareTrust REIT [Member] | |||
Operating Leased Assets [Line Items] | |||
Lessee, Operating Lease, Term of Contract | 19 years | ||
Lessee Leasing Arrangements, Operating Leases, Number of Renewal Terms | Renewals | 3 |
Leases Additional Disclosures (
Leases Additional Disclosures (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($)facilities | |
Operating Leased Assets [Line Items] | ||
Gain (Loss) on Contract Termination | $ 2,715 | |
Business Exit Costs | $ 0 | $ 4,017 |
Skilled Nursing, Assisted Living and Independent Living Facilities [Member] | ||
Operating Leased Assets [Line Items] | ||
Number of Businesses with Lease Terminations | facilities | 4 | |
8051 Services, Skilled Nursing Care Facilities [Member] | ||
Operating Leased Assets [Line Items] | ||
Number of Businesses with Lease Terminations | facilities | 1 | |
Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations [Member] | 8051 Services, Skilled Nursing Care Facilities [Member] | ||
Operating Leased Assets [Line Items] | ||
Number of Businesses Closed | facilities | 1 | |
Facility Closing [Member] | ||
Operating Leased Assets [Line Items] | ||
Business Exit Costs | $ 2,830 | |
Contract Termination [Member] | ||
Operating Leased Assets [Line Items] | ||
Business Exit Costs | $ 1,187 |
Leases Sale Leaseback Transacti
Leases Sale Leaseback Transactions (Details) $ in Thousands | Jun. 01, 2017USD ($) |
Sale Leaseback Transaction [Line Items] | |
Sale Leaseback Transaction, Lease Terms | 20 |
Sale Leaseback Transaction, Gross Proceeds, Investing Activities | $ 38,000 |
Sale Leaseback Transaction, Historical Cost | 24,847 |
Sale Leaseback Transaction, Current Period Gain Recognized | $ 13,153 |
Number of Optional Lease Extension [Member] [Member] | |
Sale Leaseback Transaction [Line Items] | |
Sale Leaseback Transaction, Lease Terms | 3 |
Optional Lease Extension [Member] | |
Sale Leaseback Transaction [Line Items] | |
Sale Leaseback Transaction, Lease Terms | 5 |
8051 Services, Skilled Nursing Care Facilities [Member] | |
Sale Leaseback Transaction [Line Items] | |
Sale Leaseback Transaction, Description of Asset(s) | 2 |
Assisted Living Facility [Member] | |
Sale Leaseback Transaction [Line Items] | |
Sale Leaseback Transaction, Description of Asset(s) | 1 |
Leases Future minimum lease pay
Leases Future minimum lease payments (Details) $ in Thousands | Mar. 31, 2018USD ($) |
Leases [Abstract] | |
2,018 | $ 101,614 |
2,019 | 136,138 |
2,020 | 135,827 |
2,021 | 135,612 |
2,022 | 134,082 |
2,023 | 133,022 |
Thereafter | 953,593 |
Operating Leases, Future Minimum Payments Due | $ 1,729,888 |
Commitments and Contingencies L
Commitments and Contingencies Litigation (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | |
Litigation [Line Items] | |||
Litigation Settlement, Amount Awarded to Other Party | $ 11,000 | ||
Payments for Legal Settlements | $ 11,000 | ||
Litigation Settlement, Return of Unclaimed Settlement | $ 1,664 |
Commitments and Contingencies R
Commitments and Contingencies Revenue Recoupments (Details) | Mar. 31, 2018Operationsfacilities |
Probe Reviews [Abstract] | |
Facilities under Medicare Probe Reviews | facilities | 4 |
Agencies under Zone Program Integrity Contractors | Operations | 1 |
Commitments and Contingencies O
Commitments and Contingencies Other Matters (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2013USD ($) | |
Other Commitments [Line Items] | |
Litigation Settlement Paid to U.S. Government | $ 48,000 |
Commitments and Contingencies C
Commitments and Contingencies Concentrations (Details) | 3 Months Ended | ||
Mar. 31, 2018Rate | Mar. 31, 2017Rate | Dec. 31, 2017Rate | |
Concentration Risk [Line Items] | |||
% of Revenue | 100.00% | 100.00% | |
Total Medicaid and Medicare | |||
Concentration Risk [Line Items] | |||
Accounts receivable by payor as a percent of total accounts receivable | 57.50% | 56.70% | |
% of Revenue | 67.90% | 68.20% |
Commitments and Contingencies91
Commitments and Contingencies Cash in Excess of FDIC Limits (Details) - USD ($) $ in Thousands | Apr. 27, 2018 | Mar. 31, 2018 |
Cash in Excess of FDIC limits [Line Items] | ||
Cash, FDIC Insured Amount | $ 250 | |
Subsequent Event [Member] | ||
Cash in Excess of FDIC limits [Line Items] | ||
Cash, Uninsured Amount | $ 920 |
Common Stock (Details)
Common Stock (Details) - USD ($) shares in Thousands, $ in Thousands | Apr. 03, 2018 | Feb. 08, 2017 | Mar. 31, 2018 | Mar. 31, 2017 |
Common Stock Transactions [Line Items] | ||||
Stock Repurchase Program, Period in Force | 12 months | |||
Stock Repurchase Program Expiration Date | Feb. 8, 2018 | |||
Repurchase of common stock (Note 18) | $ 0 | $ (6,068) | ||
Common Stock [Member] | ||||
Common Stock Transactions [Line Items] | ||||
Stock Repurchase Program, Authorized Amount | $ 30,000 | |||
Stock Repurchased During Period, Shares | 343 | |||
Repurchase of common stock (Note 18) | $ (6,068) | |||
Subsequent Event [Member] | ||||
Common Stock Transactions [Line Items] | ||||
Stock Repurchase Program, Period in Force | 11 months | |||
Stock Repurchase Program Expiration Date | Feb. 20, 2019 | |||
Subsequent Event [Member] | Common Stock [Member] | ||||
Common Stock Transactions [Line Items] | ||||
Stock Repurchase Program, Authorized Amount | $ 30,000 |