| BASIS OF PRESENTATION (Policies) | 3 Months Ended |
| Mar. 31, 2018 |
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
| Basis of Presentation | General – The accompanying unaudited condensed consolidated financial statements have been prepared by athenahealth, Inc. (which we refer to as the Company, we, us, or our) in accordance with accounting principles generally accepted in the United States, or GAAP, for interim financial reporting and as required by Regulation S-X, Rule 10-01, and include the results of operations of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The year-end condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP for complete financial statements. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of items of a normal and recurring nature) necessary to fairly present the financial position as of March 31, 2018 and December 31, 2017, as indicated above, the results of operations for the three months ended March 31, 2018 and 2017 , and cash flows for the three months ended March 31, 2018 and 2017 . The results of operations for the three months ended March 31, 2018 are not necessarily indicative of the results to be expected for the full year. When preparing financial statements in conformity with GAAP, we must make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses during the reporting period. Actual results could differ from those estimates, and such differences could be material. |
| Recently Adopted and New Accounting Pronouncements | Recently Adopted Pronouncements Revenue from Contracts with Customers We adopted the new revenue recognition standard on January 1, 2018 using a modified retrospective adoption methodology, whereby the cumulative impact of all prior periods is recorded in retained earnings or other impacted balance sheet line items upon adoption. Under the modified retrospective adoption method, we elected to retroactively adjust, inclusive of all previous modifications, only those contracts that were considered open at the date of initial application. Refer to Note 2 – Revenue and Contract Costs for further information along with our new accounting policies. The aggregation of the adjustments resulted in an adjustment to opening retained earnings as follows: Cumulative Effect of Adoption Impact of New Revenue Standard January 1, 2018 Contract assets $ 77.4 Deferred tax assets, net (40.9 ) Other assets (1) 61.5 Total assets $ 98.0 Deferred revenue, current (8.1 ) Deferred revenue, net of current portion (44.8 ) Deferred tax liability, net 7.4 Retained earnings 143.5 Total liabilities and stockholders’ equity $ 98.0 (1) Adjustment to this line item represents the effect of the new revenue standard adoption on deferred commissions and contract fulfillment costs, of $37.7 million and $23.8 million , respectively. The following table reconciles the balances as presented for the three months ended March 31, 2018 to the balances prior to the adjustments made to implement the new revenue recognition standard for the same period: As Presented Impact of New Revenue Standard Previous Revenue Standard Revenue $ 329.4 $ 9.1 $ 320.3 Cost of revenue 154.0 4.1 158.1 Gross profit 175.4 13.2 162.2 Other operating expenses: Selling and marketing 49.7 2.8 52.5 Research and development 48.2 — 48.2 General and administrative 35.4 — 35.4 Total other operating expenses 133.3 2.8 136.1 Operating income 42.1 16.0 26.1 Other expense (2.6 ) — (2.6 ) Income before income tax provision 39.5 16.0 23.5 Income tax provision 8.4 4.0 4.4 Net income $ 31.1 $ 12.0 $ 19.1 Foreign currency translation adjustment (0.3 ) — (0.3 ) Comprehensive income $ 30.8 $ 12.0 $ 18.8 Net income per share – Basic $ 0.77 $ 0.30 $ 0.47 Net income per share – Diluted $ 0.76 $ 0.29 $ 0.47 As we ceased amortizing implementation fees under the new revenue recognition standard, we condensed our implementation and other line item into a single revenue line item. The following table disaggregates total revenue into the format previously presented: Previous Revenue Standard Three Months Ended March 31, 2018 2017 Business services $ 313.3 $ 278.3 Implementation and other 7.0 7.1 Total revenue $ 320.3 $ 285.4 Financial Instruments In January 2016, a new accounting standard was issued to address certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The most significant impact to our consolidated financial statements relates to the recognition and measurement of equity instruments without readily determinable fair values which were previously carried at cost less any impairment determined to be other than temporary. Under the new standard, we will measure all equity investments without readily determinable fair values at cost, less impairment, adjusted by observable price changes, such as equity financings, for the same or similar investment from the same issuer. Gains and losses will be recorded in our condensed consolidated statements of income and comprehensive income on a prospective basis. We adopted this accounting standard on January 1, 2018 and the impact on our condensed consolidated statements of income and comprehensive income for the three months ended March 31, 2018 was not material; however, the impact could be material in future periods. Related Party Transactions – We have a long-term investment in Access Healthcare Services Private Limited, or Access, a vendor that provides primarily business process outsourcing services for us. Our contractual obligations with Access include a purchase obligation that limits our ability to decrease our purchased services more than 33% from the previous calendar year's volume. The tables below present the amounts included within each of the applicable financial statement line items resulting from transactions with our related party: Three months ended March 31, 2018 2017 Cost of revenue $ 17.6 $ 14.3 Research and development 0.2 — March 31, December 31, Accounts payable $ — $ 5.6 Accrued expenses 6.4 5.7 Exit Costs, Including Restructuring Costs – During the three months ended March 31, 2018 , we recorded a charge of $5.2 million associated with the cost reduction plan we announced in 2017, of which $1.3 million was recorded in cost of revenue and $3.7 million was recorded in general and administrative expense. The activity related to the exit cost accrual during the three months ended March 31, 2018 consists of the following: Workforce Reductions Accrual at December 31, 2017 $ 3.4 Additions 1.6 Cash Payments (3.4 ) Accrual at March 31, 2018 $ 1.6 Commitments and Contingencies – We are engaged from time to time in certain legal disputes arising in the ordinary course of business, including employment discrimination claims and challenges to our intellectual property. We believe that we have adequate legal defenses and that the likelihood of a loss contingency relating to the ultimate disposition of any of these disputes is remote. When the likelihood of a loss contingency becomes at least reasonably possible with respect to any of these disputes, or, as applicable in the future, if there is at least a reasonable possibility that a loss exceeding amounts already recognized may have been incurred, we will revise our disclosures in accordance with the relevant authoritative guidance. Additionally, we will accrue a liability for loss contingencies when we believe that it is both probable that a liability has been incurred and that we can reasonably estimate the amount of the loss. We will review these accruals and adjust them to reflect ongoing negotiations, settlements, rulings, advice of legal counsel, and other relevant information. To the extent new information is obtained, and our views on the probable outcomes of claims, suits, assessments, investigations, or legal proceedings change, changes in our accrued liabilities would be recorded in the period in which such determination is made. We expense legal costs, including those incurred in connection with loss contingencies, as incurred. New Accounting Pronouncement Not Yet Adopted Leases In February 2016, a new accounting standard was issued for leases. The new standard most significantly impacts lessee accounting and disclosures, but also requires enhanced disclosures for lessors. First, this standard requires lessees to identify arrangements that should be accounted for as leases. Under this standard, for lease arrangements exceeding a 12-month term, a right-of-use asset and lease obligation is recorded by the lessee for all leases, whether operating or financing, while the statements of income and comprehensive income reflects lease expense for operating leases and amortization and interest expense for financing leases. Leases with a term of 12 months or less will be accounted for similar to the existing standard for operating leases. In addition, the new lease standard requires the use of the modified retrospective method. This standard is effective for public companies for fiscal years and interim periods within those fiscal years beginning after December 15, 2018. Early adoption is permitted; however, we expect to adopt this standard on January 1, 2019. We anticipate that this standard will have a material impact on our consolidated financial statements, as all long-term leases will be capitalized on the condensed consolidated balance sheet. |
| New Contract Assets Accounting Policy | New Contract Assets and Deferred Revenue Accounting Policy Due to our go-to-market strategy wherein we do not have a contractual right to bill clients until their collections from various payers are posted to athenaNet, we recognize revenue in advance of our right to payment from our clients. Our clients are billed monthly, in arrears, typically based upon a percentage of collections posted to athenaNet. Amounts recognized as revenue prior to our right to collections are recorded in our contract asset balance. Amounts that we are entitled to collect under the contract are recorded as accounts receivable. Our contract asset balance at March 31, 2018 was $86.4 million . Changes in the contract asset balance primarily consist of increases as a result of providing services that result in additional consideration and are offset by our right to payment for services becoming unconditional. Our deferred revenue balances mainly consist of fees paid by our clients for which the associated services have not been performed. New Revenue Recognition Accounting Policy All revenue is recognized as our performance obligations are satisfied. We derive the majority of our revenue from business services associated with our integrated, network-enabled services. Our integrated athenaOne services for healthcare practices and medical groups and for hospitals and health systems, as well as related standalone services, consist of medical billing and practice management; electronic health records, or EHR; patient engagement; and order transmission and care coordination, which are supported by our network, athenaNet; we refer to such offerings collectively as athenaOne. We consider the series of services provided under athenaOne to be one performance obligation. Examples of other performance obligations that we have include other athenahealth-branded services such as our population health offering and those related to supporting athenaOne, including professional services and consulting work, and various services under the Epocrates® brand name. Each of these performance obligations is satisfied and recognized over time, which is typically one month or less. Our clients typically purchase service contracts for our integrated, network-enabled services that renew automatically. In many cases, our clients may terminate their agreements with 90 days’ notice without cause, thereby limiting the term in which we have enforceable rights and obligations, although this time period can vary from client to client. For athenaOne service arrangements, the majority of our fees are variable consideration contingent upon the collections of our clients. We provide value to our clients over the term of the contract, and we recognize revenue ratably over the term, which is consistent with the measure of progress. In the event that we are entitled to variable consideration for services provided during a specified time period, fees for these services are allocated to and recognized over the specified time period. We estimate the variable consideration which we expect to be entitled to over the contractual period associated with our athenaOne contracts, which begins no earlier than go-live, and recognize the fees over the term. The estimate of variable consideration included in the transaction price typically involves estimating the amounts our clients will ultimately collect associated with the services they provide with the assistance of athenaNet and the relative fee we charge associated with those collections. Inputs to these estimates include, but are not limited to, historical service fees, historical collection amounts, the timing of historical collections relative to the timing of when claims are submitted by our clients to their respective payers, macro trends, and trends amongst certain types of similar clients. When reviewing our estimates, in order to ensure that our estimates do not pose a risk of significantly overstating our revenue in any reporting period, we will apply constraints, when appropriate, to certain estimates around our variable consideration. Management will perform analyses periodically to verify the accuracy of our estimates of variable consideration. |
| New Deferred Commissions and Contract Fulfillment Costs Accounting Policies | New Deferred Commissions and Contract Fulfillment Costs Accounting Policies Our sales incentive plans include commissions payable to employees and third parties at the time of initial contract execution that are capitalized as incremental costs to obtain a contract. The capitalized commissions are amortized over the period the related services are transferred including consideration of expected client renewals. As we do not offer commissions on contract renewals, we have determined the amortization period to be the estimated client life, which we have estimated to be 12 years . Deferred commissions were $40.6 million at March 31, 2018 and are included in the other assets line on our condensed consolidated balance sheet. During implementation and prior to go-live, we incur certain contract fulfillment costs primarily related to the configuration of athenaNet for our clients. These costs are capitalized to the extent they are directly related to a contract, are recoverable, and create a resource used to deliver our athenaOne and other athenahealth-branded business services. These costs are amortized over the period the related services are transferred including consideration of expected client renewals, which is based upon our estimate of the client life. |
| Net Income (Loss) per Share | Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding and potentially dilutive securities outstanding during the period under the treasury stock method. Potentially dilutive securities include stock options, restricted stock units, and shares to be purchased under the employee stock purchase plan. Under the treasury stock method, dilutive securities are assumed to be exercised at the beginning of the periods and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Securities are excluded from the computation of diluted net income (loss) per share if their effect would be anti-dilutive to earnings per share; therefore, in periods of net loss, shares used to calculate basic and diluted net loss per share are equivalent. |
| Fair Value of Financial Instruments | As of March 31, 2018 and December 31, 2017 , the carrying amounts of cash and cash equivalents, receivables, accounts payable, and accrued expenses approximated their estimated fair values because of the short-term nature of these financial instruments. Money market funds are valued using a market approach based upon the quoted market prices of identical instruments when available or other observable inputs such as trading prices of identical instruments in inactive markets or similar securities. Our MDP Accelerator program is designed to cultivate health care information technology start-ups and expand services offered to our provider network. MDP Accelerator portfolio investments and our other direct investments are typically made in the form of convertible notes receivable or equity investments, which are included in other assets on our condensed consolidated balance sheets. At March 31, 2018 , as there is no indication of performance risk, we estimate that the fair value of the notes receivable approximates cost based on inputs including the original transaction prices, our own recent transactions in the same or similar instruments, completed or pending third-party transactions in the underlying investments, subsequent rounds of financing, and changes in financial ratios or cash flows. |
