Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 03, 2017 | Jun. 30, 2016 | |
Document and Entity Information [Line Items] | |||
Entity Registrant Name | Genesis Healthcare, Inc. | ||
Entity Central Index Key | 1,351,051 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 67 | ||
Class A Common Stock | |||
Document and Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 76,836,541 | ||
Class B Common Stock | |||
Document and Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 15,495,019 | ||
Class C Common Stock | |||
Document and Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 62,200,511 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 51,408 | $ 61,543 |
Restricted cash and investments in marketable securities | 43,555 | 52,917 |
Accounts receivable, net of allowances for doubtful accounts of $218,383 and $189,739 at December 31, 2016 and December 31, 2015, respectively | 832,109 | 789,387 |
Prepaid expenses | 64,218 | 58,622 |
Other current assets | 63,641 | 49,024 |
Assets held for sale, current | 4,056 | |
Total current assets | 1,058,987 | 1,011,493 |
Property and equipment, net of accumulated depreciation of $807,776 and $638,768 at December 31, 2016 and December 31, 2015, respectively | 3,765,393 | 4,085,247 |
Restricted cash and investments in marketable securities | 112,471 | 145,210 |
Other long-term assets | 137,602 | 130,869 |
Deferred income taxes | 6,107 | 7,144 |
Identifiable intangible assets, net of accumulated amortization of $91,155 and $66,570 at December 31, 2016 and December 31, 2015, respectively | 175,566 | 209,967 |
Goodwill | 440,712 | 470,019 |
Assets held for sale, noncurrent | 82,363 | |
Total assets | 5,779,201 | 6,059,949 |
Current liabilities: | ||
Current installments of long-term debt | 24,594 | 12,477 |
Capital lease obligation | 1,886 | 1,842 |
Financing obligations | 1,613 | 989 |
Accounts payable | 258,616 | 233,801 |
Accrued expenses | 215,457 | 197,741 |
Accrued compensation | 181,841 | 185,054 |
Self-insurance reserves | 172,565 | 166,761 |
Current portion of liabilities held for sale | 988 | |
Total current liabilities | 857,560 | 798,665 |
Long-term liabilities: | ||
Long-term debt | 1,146,550 | 1,186,159 |
Capital lease obligations | 997,340 | 1,053,816 |
Financing obligations | 2,867,534 | 3,064,077 |
Deferred income taxes | 22,354 | 14,939 |
Self-insurance reserves | 445,559 | 428,569 |
Liabilities held for sale | 69,057 | |
Other long-term liabilities | 103,435 | 133,111 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Additional paid-in-capital | 305,358 | 295,359 |
Accumulated deficit | (795,615) | (731,602) |
Accumulated other comprehensive income (loss) | (221) | (218) |
Total stockholders’ deficit before noncontrolling interests | (490,323) | (436,307) |
Noncontrolling interests | (239,865) | (183,080) |
Total stockholders' deficit | (730,188) | (619,387) |
Total liabilities and stockholders’ deficit | 5,779,201 | 6,059,949 |
Class A Common Stock | ||
Stockholders’ equity: | ||
Common stock | 75 | 74 |
Class B Common Stock | ||
Stockholders’ equity: | ||
Common stock | 16 | 16 |
Class C Common Stock | ||
Stockholders’ equity: | ||
Common stock | $ 64 | $ 64 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Allowance for doubtful accounts | $ 218,383 | $ 189,739 |
Other assets: | ||
Accumulated depreciation on property and equipment | 807,776 | 638,768 |
Accumulated amortization on intangible assets | $ 91,155 | $ 66,570 |
Class A Common Stock | ||
Stockholders’ equity: | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, issued (in shares) | 75,187,388 | 73,593,732 |
Common stock, shares, outstanding (in shares) | 75,187,388 | 73,593,732 |
Class B Common Stock | ||
Stockholders’ equity: | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 20,000,000 | 20,000,000 |
Common stock, issued (in shares) | 15,495,019 | 15,511,603 |
Common stock, shares, outstanding (in shares) | 15,495,019 | 15,511,603 |
Class C Common Stock | ||
Stockholders’ equity: | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, issued (in shares) | 63,849,380 | 64,449,380 |
Common stock, shares, outstanding (in shares) | 63,849,380 | 64,449,380 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) | |||||||||||
Net revenues | $ 1,402,860 | $ 1,418,994 | $ 1,438,358 | $ 1,472,218 | $ 1,440,721 | $ 1,416,027 | $ 1,419,475 | $ 1,343,001 | $ 5,732,430 | $ 5,619,224 | $ 4,768,080 |
Salaries, wages and benefits | 3,369,713 | 3,289,820 | 2,904,094 | ||||||||
Other operating expenses | 1,413,639 | 1,358,983 | 1,109,699 | ||||||||
General and administrative costs | 186,062 | 175,889 | 147,063 | ||||||||
Provision for losses on accounts receivable | 107,815 | 100,521 | 77,670 | ||||||||
Lease expense | 146,244 | 150,276 | 131,898 | ||||||||
Depreciation and amortization expense | 254,459 | 237,617 | 193,675 | ||||||||
Interest expense | 528,544 | 507,809 | 442,724 | ||||||||
Loss on early extinguishment of debt | 16,290 | 130 | 1,133 | ||||||||
Investment income | (3,018) | (1,677) | (3,399) | ||||||||
Other income | (207,070) | (1,400) | (138) | ||||||||
Transaction costs | 7,928 | 96,374 | 13,353 | ||||||||
Long-lived asset impairments | 35,431 | 28,546 | 31,399 | ||||||||
Skilled Healthcare and other loss contingency expense | 15,192 | 31,500 | |||||||||
Equity in net (income) loss of unconsolidated affiliates | (3,286) | (2,139) | 416 | ||||||||
Loss before income tax (benefit) expense | (135,513) | (353,025) | (281,507) | ||||||||
Income tax (benefit) expense | (17,435) | 172,524 | (44,022) | ||||||||
Loss from continuing operations | 22,429 | (20,434) | (23,034) | (43,001) | (265,843) | (28,991) | (17,464) | (112,678) | (118,078) | (525,549) | (237,485) |
Income (loss) from discontinued operations, net of taxes | 28 | (24) | 61 | (38) | 352 | 39 | (1,722) | 112 | 27 | (1,219) | (14,044) |
Net loss | (118,051) | (526,768) | (251,529) | ||||||||
Less net loss (income) attributable to noncontrolling interests | 54,038 | 100,573 | (2,456) | ||||||||
Net loss attributable to Genesis Healthcare, Inc | $ 22,457 | $ (20,458) | $ (22,973) | $ (43,039) | $ (265,491) | $ (28,952) | $ (19,186) | $ (112,566) | $ (64,013) | $ (426,195) | $ (253,985) |
Basic: | |||||||||||
Weighted-average shares outstanding for loss from continuing operations per share | 90,636 | 90,226 | 89,421 | 89,198 | 89,873 | 85,755 | 49,865 | ||||
Net loss per common share: | |||||||||||
Loss from continuing operations attributable to Genesis Healthcare, Inc | $ (0.71) | $ (4.96) | $ (4.81) | ||||||||
Income (loss) from discontinued operations, net of taxes | 0 | (0.01) | (0.28) | ||||||||
Net loss attributable to Genesis Healthcare, Inc. | $ 0.25 | $ (0.23) | $ (0.26) | $ (0.48) | $ (0.71) | $ (4.97) | $ (5.09) | ||||
Effect of dilutive shares: | |||||||||||
Weighted-average shares outstanding for loss from continuing operations per share | 92,337 | 90,226 | 89,421 | 89,198 | 152,532 | 85,755 | 49,865 | ||||
Net loss per common share. | |||||||||||
Loss from continuing operations attributable to Genesis Healthcare, Inc. | $ (0.82) | $ (4.96) | $ (4.81) | ||||||||
Income (loss) from discontinued operations, net of taxes | 0 | (0.01) | (0.28) | ||||||||
Net loss attributable to Genesis Healthcare, Inc. | $ 0.24 | $ (0.23) | $ (0.26) | $ (0.48) | $ (0.82) | $ (4.97) | $ (5.09) |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | |||
Net loss | $ (118,051) | $ (526,768) | $ (251,529) |
Net unrealized loss on marketable securities, net of tax | (5) | (891) | (553) |
Comprehensive loss | (118,056) | (527,659) | (252,082) |
Less: comprehensive loss (income) attributable to noncontrolling interests | 54,040 | 100,885 | (2,456) |
Comprehensive loss attributable to Genesis Healthcare, Inc. | $ (64,016) | $ (426,774) | $ (254,538) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) shares in Thousands, $ in Thousands | Common StockClass A Common Stock | Common StockClass B Common Stock | Common StockClass C Common Stock | Additional Paid-In Capital | (Accumulated Deficit) | Accumulated Other Comprehensive (Loss) income | Stockholders' deficit | Noncontrolling interests | Total |
Balance, beginning of period at Dec. 31, 2013 | $ 50 | $ 161,452 | $ (349,269) | $ 1,068 | $ (186,699) | $ 2,818 | $ (183,881) | ||
Balance, beginning of period (in shares) at Dec. 31, 2013 | 49,865 | ||||||||
Comprehensive (loss) income: | |||||||||
Net loss | (253,985) | (253,985) | 2,456 | (251,529) | |||||
Net unrealized loss on marketable securities, net of tax | (553) | (553) | (553) | ||||||
Distributions to stockholders | (17,960) | (17,960) | (17,960) | ||||||
Distributions to noncontrolling interests | (3,567) | (3,567) | |||||||
Balance, end of period at Dec. 31, 2014 | $ 50 | 143,492 | (603,254) | 515 | (459,197) | 1,707 | (457,490) | ||
Balance, end of period (in shares) at Dec. 31, 2014 | 49,865 | ||||||||
Increase (decrease) in stockholders' deficit | |||||||||
Combination share conversion | $ 24 | $ 16 | $ 64 | 130,530 | 297,847 | (154) | 428,327 | (80,186) | 348,141 |
Combination share conversion (in shares) | 23,723 | 15,512 | 64,449 | ||||||
Comprehensive (loss) income: | |||||||||
Net loss | (426,195) | (426,195) | (100,573) | (526,768) | |||||
Net unrealized loss on marketable securities, net of tax | (579) | (579) | (312) | (891) | |||||
Share-based compensation | 28,472 | 28,472 | 28,472 | ||||||
Issuance of common stock | 24 | 24 | 24 | ||||||
Issuance of common stock, shares | 6 | ||||||||
Acquisition of noncontrolling interest | (7,159) | (7,159) | 7,159 | ||||||
Distributions to noncontrolling interests | (10,875) | (10,875) | |||||||
Balance, end of period at Dec. 31, 2015 | $ 74 | $ 16 | $ 64 | 295,359 | (731,602) | (218) | (436,307) | (183,080) | (619,387) |
Balance, end of period (in shares) at Dec. 31, 2015 | 73,594 | 15,512 | 64,449 | ||||||
Comprehensive (loss) income: | |||||||||
Net loss | (64,013) | (64,013) | (54,038) | (118,051) | |||||
Net unrealized loss on marketable securities, net of tax | (3) | (3) | (2) | (5) | |||||
Share-based compensation | 7,015 | 7,015 | 7,015 | ||||||
Issuance of common stock | $ 1 | 1,994 | 1,995 | 1,995 | |||||
Issuance of common stock, shares | 976 | ||||||||
Conversion of common stock among classes (in shares) | 617 | (17) | (600) | ||||||
Distributions to noncontrolling interests | (2,745) | (2,745) | |||||||
Issuance of convertible debt | 990 | 990 | 990 | ||||||
Balance, end of period at Dec. 31, 2016 | $ 75 | $ 16 | $ 64 | $ 305,358 | $ (795,615) | $ (221) | $ (490,323) | $ (239,865) | $ (730,188) |
Balance, end of period (in shares) at Dec. 31, 2016 | 75,187 | 15,495 | 63,849 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash Flows from Operating Activities | |||
Net loss | $ (118,051) | $ (526,768) | $ (251,529) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Non-cash interest and leasing arrangements, net | 90,227 | 93,800 | 86,073 |
Other non-cash gains and charges, net | (202,070) | (1,063) | 3,947 |
Share based compensation | 8,414 | 28,472 | |
Depreciation and amortization | 254,459 | 237,763 | 196,192 |
Provision for losses on accounts receivable | 107,815 | 100,521 | 78,552 |
Equity in net (income) loss of unconsolidated affiliates | (3,286) | (2,139) | 416 |
Provision (benefit) for deferred taxes | 7,142 | 164,750 | (58,293) |
Long-lived asset impairment | 35,431 | 28,546 | 31,399 |
Loss on early extinguishment of debt | 13,174 | 130 | 1,133 |
Changes in assets and liabilities: | |||
Accounts receivable | (170,126) | (144,624) | (33,568) |
Accounts payable and other accrued expenses and other | 45,232 | 29,230 | 53,330 |
Net cash provided by operating activities | 68,361 | 8,618 | 107,652 |
Cash Flows from Investing Activities | |||
Capital expenditures | (93,118) | (85,723) | (70,987) |
Purchases of marketable securities | (52,554) | (83,916) | (30,449) |
Proceeds on maturity or sale of marketable securities | 72,767 | 41,314 | 30,188 |
Net change in restricted cash and equivalents | 22,183 | 10,269 | (24,405) |
Sale of investment in joint venture | 6,460 | 26,358 | |
Purchases of inpatient assets, net of cash acquired | (108,299) | (167,272) | (1,878) |
Sales of assets | 150,675 | 3,738 | 5,227 |
Restricted deposits | (13,473) | ||
Investments in joint venture | (536) | (392) | (2,309) |
Other, net | 3,107 | 2,140 | (1,062) |
Net cash used in investing activities | (12,788) | (253,484) | (95,675) |
Cash Flows from Financing Activities | |||
Borrowings under revolving credit facility | 817,000 | 864,500 | 603,500 |
Repayments under revolving credit facility | (787,150) | (756,000) | (549,000) |
Proceeds from issuance of long-term debt | 416,161 | 495,201 | 960 |
Proceeds from tenant improvement draws under lease arrangements | 5,651 | 2,920 | 6,087 |
Repayment of long-term debt | (500,101) | (357,716) | (17,946) |
Debt issuance costs | (14,524) | (19,193) | (7,916) |
Distributions to noncontrolling interests and stockholders | (2,745) | (10,875) | (21,527) |
Issuance of stock | 24 | ||
Net cash (used in) provided by financing activities | (65,708) | 218,861 | 14,158 |
Net decrease in cash and cash equivalents | (10,135) | (26,005) | 26,135 |
Beginning of period | 61,543 | 87,548 | 61,413 |
End of period | 51,408 | 61,543 | 87,548 |
Supplemental disclosure of cash flow information | |||
Interest paid | 445,959 | 416,163 | 369,124 |
Net taxes (refunded) paid | (10,270) | 20,893 | 2,408 |
Non-cash investing and financing activities: | |||
Capital leases incurred | 56,766 | 13,096 | |
Capital leases reduced | (70,997) | ||
Financing obligations reduced | (257,101) | ||
Financing obligations incurred | 83,989 | $ 80,284 | |
Assumption of long-term debt, net of reclass | 4,772 | $ 436,887 | |
Financing obligation assets | $ (40,876) |
General Information
General Information | 12 Months Ended |
Dec. 31, 2016 | |
General Information | |
Description of Business | (1) Description of Business Genesis Healthcare, Inc. is a healthcare services company that through its subsidiaries (collectively, the Company) owns and operates skilled nursing facilities, assisted/senior living facilities and a rehabilitation therapy business. The Company has an administrative service company that provides a full complement of administrative and consultative services that allows its affiliated operators and third-party operators with whom the Company contracts to better focus on delivery of healthcare services. The Company provides inpatient services through 499 skilled nursing, assisted/senior living and behavioral health centers located in 34 states. Revenues of the Company’s owned, leased and otherwise consolidated centers constitute approximately 86% of its revenues. The Company provides a range of rehabilitation therapy services, including speech pathology, physical therapy, occupational therapy and respiratory therapy. These services are provided by rehabilitation therapists and assistants employed or contracted at substantially all of the centers operated by the Company, as well as by contract to healthcare facilities operated by others. After the elimination of intercompany revenues, the rehabilitation therapy services business constitutes approximately 12% of the Company’s revenues. The Company provides an array of other specialty medical services, including management services, physician services, staffing services, and other healthcare related services, which comprise the balance of the Company’s revenues. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP). In the opinion of management, the consolidated financial statements include all necessary adjustments for a fair presentation of the financial position and results of operations for the periods presented. The consolidated financial statements of the Company include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions have been eliminated in consolidation. The Company presents noncontrolling interests within the stockholders’ deficit section of its consolidated balance sheets. The Company presents the amount of net loss attributable to Genesis Healthcare, Inc. and net loss (income) attributable to noncontrolling interests in its consolidated statements of operations. The consolidated financial statements include the accounts of all entities controlled by the Company through its ownership of a majority voting interest and the accounts of any variable interest entities (VIEs) where the Company is subject to a majority of the risk of loss from the VIE's activities, or entitled to receive a majority of the entity's residual returns, or both. The Company assesses the requirements related to the consolidation of VIEs, including a qualitative assessment of power and economics that considers which entity has the power to direct the activities that "most significantly impact" the VIE's economic performance and has the obligation to absorb losses of, or the right to receive benefits that could be potentially significant to, the VIE. The Company's composition of variable interest entities was not material at December 31, 2016. Certain prior year amounts have been reclassified to conform to current period presentation, the effect of which was not material. Upon adoption of new accounting guidance, debt issuance costs have been presented as a direct deduction from long-term debt rather than as an other long-term asset in all periods presented. The Company’s financial position at December 31, 2016 includes the impact of certain significant transactions and events, as disclosed within Note 4 – “ Significant Transactions and Events .” |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | (2) Estimates and Assumptions The consolidated financial statements have been prepared in conformity with U.S. GAAP, which requires management to consolidate company financial information and make informed estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The most significant estimates in the Company’s consolidated financial statements relate to allowance for doubtful accounts, self-insured liability risks, income taxes, impairment of long-lived assets and goodwill, and other contingencies. Actual results could differ from those estimates. Net Revenues and Accounts Receivable Revenues and accounts receivable are recorded on an accrual basis as services are performed at their estimated net realizable value. The Company derives a majority of its revenue from funds under federal Medicare and state Medicaid assistance programs, the continuation of which is dependent upon governmental policies and is subject to audit risk and potential recoupment. The Company also receives payments through reimbursement from Medicaid and Medicare programs and directly from individual residents (private pay), third-party insurers and long-term care facilities. The Company assesses collectibility on all accounts prior to providing services. The Company records revenue for inpatient services and the related receivables in the accounting records at the Company’s established billing rates in the period the related services are rendered. The provision for contractual adjustments, which represents the difference between the established billing rates and predetermined reimbursement rates, is deducted from gross revenue to determine net revenue. Retroactive adjustments that are likely to result from future examinations by third party payors are accrued on an estimated basis in the period the related services are rendered and adjusted as necessary in future periods based upon new information or final settlements. The Company records revenue for rehabilitation therapy services and other ancillary services and the related receivables at the time services or products are provided or delivered to the customer. Upon delivery of products or services, the Company has no additional performance obligation to the customer. Cash and Cash Equivalents Cash and cash equivalents consist of cash and short-term investments with original maturities of three months or less when purchased and therefore, approximate fair value. The Company’s available cash is held in accounts at commercial banking institutions. The Company currently has bank deposits with commercial banking institutions that exceed Federal Deposit Insurance Corporation insurance limits. Restricted Cash and Investments in Marketable Securities Restricted cash includes cash and money market funds principally held by the Company’s wholly owned captive insurance subsidiaries, which are substantially restricted to securing outstanding claims losses. The restricted cash and investments in marketable securities balances at December 31, 2016 and 2015 were $156.0 million and $198.1 million, respectively. Restricted investments in marketable securities, comprised principally of fixed interest rate securities, are considered to be available-for-sale and accordingly are reported at fair value with unrealized gains and losses, net of related tax effects, included within accumulated other comprehensive loss, a separate component of stockholders’ deficit. Fair values for fixed interest rate securities are based on quoted market prices. A decline in the market value of any security below cost that is deemed other-than-temporary is charged to income, resulting in the establishment of a new cost basis for the security. Realized gains and losses for securities classified as available-for-sale are derived using the specific identification method for determining the cost of securities sold. Allowance for Doubtful Accounts The Company evaluates the adequacy of its allowance for doubtful accounts by estimating allowance requirement percentages for each accounts receivable aging category for each type of payor. The Company has developed estimated allowance requirement percentages by utilizing historical collection trends and its understanding of the nature and collectibility of receivables in the various aging categories and the various lines of the Company’s business. The allowance percentages are developed by payor type as the accounts receivable from each payor type have unique characteristics. The allowance for doubtful accounts also considers accounts specifically identified as uncollectible. Accounts receivable that Company management specifically estimates to be uncollectible, based upon the age of the receivables, the results of collection efforts, or other circumstances, are reserved in the allowance for doubtful accounts until written-off. Property and Equipment Property and equipment are carried at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the depreciable assets, which generally range from 20-35 years for buildings, building improvements and land improvements, and 3-15 years for equipment, furniture and fixtures and information systems. Depreciation expense on leasehold improvements and assets held under capital leases is calculated using the straight-line method over the lesser of the lease term or the estimated useful life of the asset. Expenditures for maintenance and repairs necessary to maintain property and equipment in efficient operating condition are expensed as incurred. Costs of additions and betterments are capitalized. Total depreciation expense from continuing operations for the years ended December 31, 2016, 2015 and 2014 was $234.7 million, $218.8 million, and $184.3 million, respectively. Identifiable Intangible Assets and Goodwill Definite-lived intangible assets consist of management contracts, customer relationships and favorable leases. These assets are amortized in accordance with the authoritative guidance for intangible assets using the straight-line method over their estimated useful lives. Indefinite-lived intangible assets primarily consist of trade names. Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations . See Note 9 – “ Goodwill and Identifiable Intangible Assets .” Impairment of Long-Lived Assets The Company’s long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by comparison of the carrying amount of an asset to the future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future undiscounted cash flows, an impairment charge is recognized to the extent the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell. The Company performs an assessment of qualitative factors prior to the use of the two step quantitative method to determine if goodwill has been impaired. If such qualitative assessment does not indicate that it is more likely than not the fair value of the reporting is less than its carrying value, no further analysis is required. If required, the Company performs a quantitative goodwill impairment test which involves a two-step process. The first step is a comparison of each reporting unit’s fair value to its carrying value. If the carrying value of the reporting unit is greater than its fair value, there is an indication that impairment may exist and the second step must be performed to measure the amount of impairment loss, if any. The Company performs its annual impairment assessment for its reporting units as of September 30 of each year or more frequently if adverse events or changes in circumstances indicate that the asset may be impaired. See Note 19 – “ Asset Impairment Charges .” Self-Insurance Risks The Company provides for self-insurance risks for both general and professional liability and workers’ compensation claims based on estimates of the ultimate costs for both reported claims and claims incurred but not reported. Estimated losses from asserted and incurred but not reported claims are accrued based on the Company’s estimates of the ultimate costs of the claims, which includes costs associated with litigating or settling claims, and the relationship of past reported incidents to eventual claims payments. All relevant information, including the Company’s own historical experience, the nature and extent of existing asserted claims and reported incidents, and independent actuarial analyses of this information is used in estimating the expected amount of claims. The reserves for loss for workers’ compensation risks are discounted based on actuarial estimates of claim payment patterns whereas the reserves for general and professional liability are recorded on an undiscounted basis. The Company also considers amounts that may be recovered from excess insurance carriers in estimating the ultimate net liability for such risks. See Note 21 – “ Commitments and Contingencies – Loss Reserves For Certain Self-Insured Programs – General and Professional Liability and Workers’ Compensation .” Income Taxes The Company’s effective tax rate is based on pretax income, statutory tax rates and tax planning opportunities available in the various jurisdictions in which it operates. The Company accounts for income taxes in accordance with applicable guidance on accounting for income taxes, which requires that deferred tax assets and liabilities be recognized using enacted tax rates for the effect of temporary differences between book and tax bases on recorded assets and liabilities. Accounting guidance also requires that deferred tax assets be reduced by a valuation allowance, when it is more likely than not that a tax benefit will not be realized. The recognition and measurement of a tax position is based on management’s best judgment given the facts, circumstances and information available at the reporting date. The Company evaluates tax positions to determine whether the benefits of tax positions are more likely than not of being sustained upon audit based on the technical merits of the tax position. For tax positions that are more likely than not of being sustained upon audit, the Company recognizes the largest amount of the benefit that is greater than 50% likely of being realized upon ultimate settlement in the financial statements. For tax positions that are not more likely than not of being sustained upon audit, the Company does not recognize any portion of the benefit in the financial statements. If the more likely than not threshold is not met in the period for which a tax position is taken, the Company may subsequently recognize the benefit of that tax position if the tax matter is effectively settled, the statute of limitations expires, or if the more likely than not threshold is met in a subsequent period. The Company evaluates, on a quarterly basis, its ability to realize deferred tax assets by assessing its valuation allowance and by adjusting the amount of such allowance, if necessary. The factors used to assess the likelihood of realization are its forecast of pre-tax earnings, its forecast of future taxable income and available tax planning strategies that could be implemented to realize the net deferred tax assets. To the extent the Company prevails in matters for which reserves have been established, or are required to pay amounts in excess of its reserves, its effective tax rate in a given financial statement period could be materially affected. An unfavorable tax settlement would require use of cash and result in an increase in the effective tax rate in the year of resolution. A favorable tax settlement would be recognized as a reduction in the Company’s effective tax rate in the year of resolution. The Company records accrued interest and penalties associated with uncertain tax positions as income tax expense in the consolidated statement of operations. Leases Leasing transactions are a material part of the Company’s business. The following discussion summarizes various aspects of the Company’s accounting for leasing transactions and the related balances. Capital Leases Lease arrangements are capitalized when such leases convey substantially all the risks and benefits incidental to ownership. Capital leases are amortized over either the lease term or the life of the related assets, depending upon available purchase options and lease renewal features. Amortization related to capital lease assets is included in the consolidated statements of operations within depreciation and amortization expense. See Note 11 – “ Lease and Lease Commitments .” Operating Leases For operating leases, minimum lease payments, including minimum scheduled rent increases, are recognized as lease expense on a straight-line basis over the applicable lease terms and any periods during which the Company has use of the property but is not charged rent by a landlord. Lease terms, in most cases, provide for rent escalations and renewal options. When the Company purchases businesses that have operating lease agreements, it recognizes the fair value of the lease arrangements as either favorable or unfavorable and records these amounts as other identifiable intangible assets or other long-term liabilities, respectively. Favorable and unfavorable leases are amortized to lease expense on a straight-line basis over the remaining term of the leases. See Note 11 – “ Lease and Lease Commitments .” Sale/Leaseback Financing Obligation Prior to recognition as a sale, or profit/loss thereon, sale/leaseback transactions are evaluated to determine if their terms transfer all of the risks and rewards of ownership as demonstrated by the absence of any other continuing involvement by the seller-lessee. A sale/leaseback transaction that does not qualify for sale/leaseback accounting because of any form of continuing involvement by the seller-lessee is accounted for as a financing transaction. Under the financing method: (1) the assets and accumulated depreciation remain on the consolidated balance sheet and continue to be depreciated over the remaining useful lives; (2) no gain is recognized; and (3) proceeds received by the Company from these transactions are recorded as a financing obligation. See Note 12 – “ Financing Obligations .” Earnings (Loss) Per Common Share Earnings (loss) per common share are based upon the weighted average number of common shares outstanding during the respective periods. The Company follows the provisions of the authoritative guidance for determining whether instruments granted in share-based payment transactions are participating securities for purposes of calculating earnings per common share. See Note 5 – “ Loss Per Share .” Stock-Based Compensation The Company recognizes compensation expense related to stock-based compensation awards in accordance with the related authoritative guidance. See Note 14 – “ Stock-Based Compensation .” Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (the FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which changes the requirements for recognizing revenue when entities enter into contracts with customers. Under ASU 2014-09, an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. It also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In December 2016, the FASB issued ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers (ASU 2016-20), which serves to narrow aspects of the guidance issued in ASU 2014-09. The adoption of ASU 2014-09 is effective for annual and interim periods beginning after December 15, 2017. There are two allowed adoption methods, (1) the full retrospective method, or (2) the modified retrospective method. The full retrospective method requires recognition of the cumulative effect of applying the new standard at the earliest period presented. The modified retrospective method requires recognition of the cumulative effect of applying the new standard at the date of initial application. The Company will adopt ASU 2014-09 effective January 1, 2018 using the modified retrospective method. The Company’s evaluation of the impact of ASU 2014-09 has been ongoing since its original issuance and will continue into 2017 before it is in a position to conclude on the total effect it and ASU 2016-20 will have on its consolidated financial condition and results of operations. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016-01), which is intended to improve the recognition and measurement of financial instruments. The new guidance is effective for annual and interim periods beginning after December 15, 2017, with early adoption permitted under certain circumstances. The Company is still evaluating the effect, if any, ASU 2016-01 will have on its consolidated financial condition and results of operations. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (ASU 2016-02), which amended authoritative guidance on accounting for leases. The new provisions require that a lessee of operating leases recognize 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. The guidance is effective for annual and interim periods beginning after December 15, 2018, and will require application of the new guidance at the beginning of the earliest comparable period presented. The Company will adopt ASU 2016-02 effective January 1, 2019. ASU 2016-02 must be adopted using a modified retrospective transition. The adoption of ASU 2016-02 is expected to have a material impact on the Company’s financial position. The Company is still evaluating the impact on its results of operations. In March 2016, the FASB issued ASU No. 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (ASU 2016-09), which is intended to improve the accounting for employee share-based payments and affects all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment award transactions are simplified, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. The new guidance is effective for annual and interim periods beginning after December 15, 2016, with early adoption permitted. The Company is still evaluating the effect, if any, ASU 2016-09 will have on its consolidated financial condition and results of operations. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15), which addresses how certain cash receipts and cash payments should be presented and classified in the statement of cash flows. The new guidance is effective for annual and interim periods beginning after December 15, 2017, with early adoption permitted. The Company is still evaluating the effect, if any, that ASU 2016-15 will have on its consolidated statements of cash flows. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (230): Restricted Cash (ASU 2016-18), which requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The adoption of ASU 2016-18 is effective for annual and interim periods beginning after December 15, 2017, with early adoption permitted, including adoption in an interim period. The Company is still evaluating the effect, if any, ASU 2016-18 will have on the Company’s consolidated statement of cash flows. In January 2017, the FASB issued ASU No. 2017-01, Business Combination (805): Clarifying the Definition of a Business (ASU 2017-01), which provides guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The adoption of ASU 2017-01 is effective for annual and interim periods beginning after December 15, 2017, with early adoption permitted in certain circumstances. The Company is still evaluating the effect, if any, ASU 2017-01 will have on the Company’s consolidated financial condition and results of operations. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (350): Simplifying the Test for Goodwill Impairment (ASU 2017-04), which serves to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. ASU 2017-04 also eliminates the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The adoption of ASU 2017-04 is effective for annual and interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is still evaluating the effect, if any, ASU 2017-04 will have on the Company’s consolidated financial condition and results of operations. |
Certain Significant Risks and U
Certain Significant Risks and Uncertainties | 12 Months Ended |
Dec. 31, 2016 | |
Certain Significant Risks and Uncertainties | |
Certain Significant Risks and Uncertainties | (3) Revenue Sources The Company receives revenues from Medicare, Medicaid, private insurance, self-pay residents, other third-party payors and long-term care facilities that utilize its rehabilitation therapy and other services. The Company’s inpatient services segment derives approximately 79% of its revenue from Medicare and various state Medicaid programs. The following table depicts the Company’s inpatient services segment revenue by source for the years ended December 31, 2016, 2015 and 2014. Year ended December 31, 2016 2015 2014 Medicare % % % Medicaid % % % Insurance % % % Private and other % % % Total % % % The sources and amounts of the Company’s revenues are determined by a number of factors, including licensed bed capacity and occupancy rates of inpatient facilities, the mix of patients and the rates of reimbursement among payors. Likewise, payment for ancillary medical services, including services provided by the Company’s rehabilitation therapy services business, varies based upon the type of payor and payment methodologies. Changes in the case mix of the patients as well as payor mix among Medicare, Medicaid and private pay can significantly affect the Company’s profitability. It is not possible to quantify fully the effect of legislative changes, the interpretation or administration of such legislation or other governmental initiatives on the Company’s business and the business of the customers served by the Company’s rehabilitation therapy business. The potential impact of reforms to the United States healthcare system, including potential material changes to the delivery of healthcare services and the reimbursement paid for such services by the government or other third party payors, is uncertain at this time. Also, initiatives among managed care payors, conveners and referring acute care hospital systems to reduce lengths of stay and avoidable hospital admissions and to divert referrals to home health or other community-based care settings could have an adverse impact on the Company’s business. Accordingly, there can be no assurance that the impact of any future healthcare legislation, regulation or actions by participants in the health care continuum will not adversely affect the Company’s business. There can be no assurance that payments under governmental and private third-party payor programs will be timely, will remain at levels similar to present levels or will, in the future, be sufficient to cover the costs allocable to patients eligible for reimbursement pursuant to such programs. The Company’s financial condition and results of operations are and will continue to be affected by the reimbursement process, which in the healthcare industry is complex and can involve lengthy delays between the time that revenue is recognized and the time that reimbursement amounts are settled. Laws and regulations governing the Medicare and Medicaid programs, and the Company’s business generally, are complex and are often subject to a number of ambiguities in their application and interpretation. The Company believes that it is in substantial compliance with all applicable laws and regulations. However, from time to time the Company and its affiliates are subject to pending or threatened lawsuits and investigations involving allegations of potential wrongdoing, some of which may be material or involve significant costs to resolve and/or defend, or may lead to other adverse effects on the Company and its affiliates including, but not limited to, fines, penalties and exclusion from participation in the Medicare and/or Medicaid programs. The Company’s business is subject to a number of other known and unknown risks and uncertainties, which are discussed in Item 1A. “ Risk Factors .” |
Significant Transactions and Ev
Significant Transactions and Events | 12 Months Ended |
Dec. 31, 2016 | |
Significant Transactions and Events | |
Significant Transactions and Events | (4) The Combination with Skilled On August 18, 2014, Skilled Healthcare Group, Inc., a Delaware corporation (Skilled) entered into a Purchase and Contribution Agreement with FC-GEN Operations Investment, LLC (FC-GEN) pursuant to which the businesses and operations of FC-GEN and Skilled were combined (the Combination). On February 2, 2015, the Combination was completed. Upon completion of the Combination, the Company began operating under the name Genesis Healthcare, Inc. and the Class A common stock of the combined company continues to trade on the NYSE under the symbol “GEN.” Upon the closing of the Combination, the former owners of FC-GEN held 74.25% of the economic interests in the combined entity and the former stockholders of Skilled held the remaining 25.75% of the economic interests in the combined entity post-transaction, in each case on a fully-diluted, as-exchanged and as-converted basis. Under applicable accounting standards, FC-GEN was the accounting acquirer in the Combination, which was treated as a reverse acquisition. The acquisition method has been applied to the accounts of Skilled based on Skilled’s stock price (level 1 valuation technique – quoted prices in active markets for identical assets or liabilities) as of the acquisition date. The consideration has been allocated to the legacy Skilled business that was acquired on the acquisition date with the excess consideration over the fair value of the net assets acquired recognized as goodwill. As of the effective date of the Combination, FC-GEN’s assets and liabilities remained at their historical costs. Because FC-GEN’s pre-transaction owners held an approximately 58% direct controlling interest in Skilled and a 74.25% economic and voting interest in the combined company, FC-GEN is considered to be the acquirer of Skilled for accounting purposes. Following the closing of the Combination, the combined results of Skilled and FC-GEN are consolidated with approximately 42% direct noncontrolling economic interest shown as noncontrolling interest in the financial statements of the combined entity. The 42% direct noncontrolling economic interest is in the form of Class A common units of FC-GEN that are exchangeable on a 1 to 1 basis to public shares of the Company. The 42% direct noncontrolling economic interest will continue to decrease as Class A common units of FC-GEN are exchanged for public shares of the Company. Since the Combination, there have been conversions of 600,000 Class A common units, resulting in a dilution of the direct non-controlling interest to 41%. Consideration Price Allocation The total Skilled consideration price of $348.1 million was allocated to Skilled’s net tangible and identifiable intangible assets based upon the estimated fair values at February 2, 2015. The excess of the consideration price over the estimated fair value of the net tangible and identifiable intangible assets was recorded as goodwill. The allocation of the consideration price to property, plant and equipment, identifiable intangible assets and deferred income taxes was based upon valuation data and estimates. The aggregate goodwill arising from the Combination is based upon the expected future cash flows of the Skilled operations. Goodwill recognized from the Combination is the result of (i) the expected savings to be realized from achieving certain economies of scale and (ii) anticipated long-term improvements in Skilled’s core businesses. The Company has estimated $79.8 million of pre-existing Skilled goodwill that is deductible for income tax purposes related to the Combination. For the year ended December 31, 2015, the Company incurred transaction costs of $89.2 million, consisting of approximately $31.6 million of accounting, investment banking, legal and other costs associated with the transaction, management incentive compensation charges of $54.6 million, and a $3.0 million transaction advisory fee paid to an affiliate of the Company’s sponsors . The Company also incurred $17.8 million of deferred financing fees associated with the debt financing of the Combination. The consideration price and related allocation are summarized as follows (in thousands): Accounts receivable $ Deferred income taxes and other current assets Property, plant and equipment Weighted Average Life Identifiable intangible assets: (Years) Management contracts Customer relationships Favorable lease contracts Trade names Indefinite Total identifiable intangible assets Deferred income taxes and other assets Accounts payable and other current liabilities Long-term debt, including amounts due within one year Unfavorable lease contracts Deferred income taxes and other long-term liabilities Total identifiable net assets Goodwill Net assets $ Pro forma information The acquired business contributed net revenues of $832.0 million and net loss of $10.5 million to the Company for the period from February 1, 2015 to December 31, 2015. The unaudited pro forma net effect of the Combination assuming the acquisition occurred as of January 1, 2014 is as follows (in thousands, except per share amounts): Year ended December 31, 2015 2014 Revenues $ $ Loss attributable to Genesis Healthcare, Inc. Loss per common share: Basic $ $ Diluted $ $ The unaudited pro forma financial data have been derived by combining the historical financial results of the Company and the operations acquired in the Combination for the periods presented. The results of operations include transaction and financing costs totaling $89.2 million incurred by both the Company and Skilled in connection with the Combination. These costs have been eliminated from the results of operations for the year ended December 31, 2015 for purposes of the pro forma financial presentation. Acquisition from Revera On June 15, 2015, the Company announced that it had signed an asset purchase agreement with Revera Assisted Living, Inc., a leading owner, operator and investor in the senior living sector, to acquire 24 of its skilled nursing facilities along with its contract rehabilitation business for $240 million. The agreement provided for the acquisition of the real estate and operations of 20 of the skilled nursing facilities and the addition of the facilities to an existing master lease agreement with Welltower Inc. (Welltower), a publicly traded real estate investment trust, to operate the other four additional skilled nursing facilities. On December 1, 2015, the Company acquired 19 of the 24 skilled nursing facilities and entered into management agreements to manage the remaining five facilities. The purchase price on December 1, 2015 for the 15 owned and four leased facilities was $206.0 million. The purchase price for the 15 owned facilities was primarily financed through a bridge loan with Welltower of $134.1 million and the Company paid $20.5 million in cash. See Note 10 – “ Long-Term Debt – Real Estate Bridge Loans .” The master lease agreement with Welltower was amended to include the four leased facilities resulting in a financing obligation of $54.3 million. On September 1, 2016, the Company acquired the five remaining skilled nursing facilities from Revera for a purchase price of $39.4 million. During the period from December 1, 2015 through August 31, 2016, the Company managed the operations of these facilities. The acquisition was financed through a real estate bridge loan for $37.0 million. See Note 10 – “ Long-Term Debt – Real Estate Bridge Loans.” Sale of Kansas ALFs On January 1, 2016, the Company sold 18 Kansas assisted/senior living facilities acquired in the Combination for $67.0 million. Of the proceeds received, $54.2 million were used to pay down partially the Real Estate Bridge Loans. See Note 10 – “ Long-Term Debt – Real Estate Bridge Loans.” Sale of Hospice and Home Health In March 2016, the Company signed an agreement with FC Compassus LLC, a nationwide network of community-based hospice and palliative care programs, to sell its hospice and home health operations for $84 million. Effective May 1, 2016, the Company completed the sale and received $72 million in cash and a $12 million short-term note. The sale resulted in a gain of $43.4 million and a derecognition of goodwill and identifiable intangible assets of $30.8 million. The cash proceeds were used to pay down partially the Company’s Term Loan Facility. See Note 10 – “ Long-Term Debt – Term Loan Facility and New Term Loan Agreement.” Through the asset purchase agreement, the Company retained certain liabilities. See Note 21 – “ Commitments and Contingencies – Legal Proceedings - Creekside Hospice Litigation .” Certain members of the Company’s board of directors indirectly beneficially hold ownership interests in FC Compassus LLC totaling less than 10% in the aggregate. HUD Insured Loans During the year ended December 31, 2016, the Company closed on the HUD insured financings of 28 skilled nursing facilities for $205.3 million. The total proceeds from the financings were used to pay down partially the Real Estate Bridge Loans. See Note 10 – “ Long-Term Debt – Real Estate Bridge Loans.” Divestiture of Non-Strategic Facilities and Investments On October 18, 2016, the Company completed the divesture of nine underperforming leased assisted living facilities in the states of Pennsylvania, Delaware and West Virginia. The nine facilities had annual revenue of $22.5 million and $3.3 million of pre-tax net loss. The divestiture resulted in a recognized gain of $19.8 million resulting from the write-off of the facilities’ financing obligation balance partially offset by the retirement of the asset subject to financing obligation. On October 23, 2016, the Company entered into a purchase and sale agreement to sell 18 facilities (16 owned and 2 leased) in the states of Kansas, Missouri, Nebraska and Iowa. The transaction will mark an exit from the inpatient business in these states. Closing is subject to licensure and other regulatory approvals. The 18 facilities have annual revenue of $110.1 million, pre-tax net loss of $10.7 million and total assets of $80 million. Sale proceeds of approximately $80 million, net of transaction costs, will principally be used to repay the Company’s indebtedness. The assets and liabilities of the 16 owned facilities subject to sale have been presented as assets held for sale at December 31, 2016. See Note 20 – “ Assets Held for Sale and Discontinued Operations .” On December 15, 2016, the Company completed the divestiture of a previously closed leased skilled nursing facility in the state of Maryland. The divestiture resulted in a recognized gain of $1.9 million resulting from the write-off of the facility’s financing obligation balance. See Note 18 – “ Other Income .” On December 22, 2016, the Company received an escrow release of $5.0 million associated with a pending sale of five skilled nursing facilities located in California the Company owns and leases to a third party operator. The sale failed to be completed by the closing date dictated in the sale agreement and the funds held in escrow were released to the Company. The Company recorded the $5.0 million as a gain. See Note 18 – “ Other Income .” On December 31, 2016, the Company sold its 50% joint venture interest in a pharmacy company for $5.4 million. The Company wrote off its joint venture investment of $1.5 million and recorded a gain on sale of $3.9 million. See Note 18 – “ Other Income .” New Master Leases On November 1, 2016, Welltower sold the real estate of 64 facilities to Second Spring Healthcare Investments (Second Spring), a joint venture formed by affiliates of Lindsay Goldberg LLC, a private investment firm, and affiliates of Omega. The Company will continue to operate the facilities pursuant to its new lease with affiliates of Second Spring effective November 1, 2016 and there will be no change in the operations of these facilities. The 64 facilities had been included in the Company’s master lease with Welltower and were historically subject to 3.4% annual escalators, which were scheduled to decrease to 2.9% annual escalators effective April 1, 2017. Under the new lease with Second Spring, initial annual rent for the 64 properties is reduced approximately 5% to $103.9 million and annual escalators will decrease to 1.0% after year 1, 1.5% after year 2, and 2.0% thereafter. The more favorable lease terms are expected to reduce the Company’s cumulative rent obligations through January 2032 by $297 million. As part of the transaction, the Company issued a note totaling $51.2 million to Welltower, with a maturity date of October 30, 2020. See Note 10 – “Long-Term Debt – Notes Payable .” On December 23, 2016, Welltower sold the real estate of 28 additional facilities to Cindat Best Years Welltower JV LLC (CBYW), a joint venture among Welltower, Cindat Capital Management Ltd., and Union Life Insurance Co., Ltd. The Company will continue to operate the facilities pursuant to its new lease with affiliates of CBYW effective December 23, 2016 and there will be no change in the operations of these facilities. The 28 facilities were included in the Company’s master lease with Welltower and had been subject to 3.4% annual escalators, which were scheduled to decrease to 2.9% annual escalators effective April 1, 2017. Under the new lease, the 28 properties’ initial annual rent is reduced by approximately 5% to $54.5 million and the annual escalators are decreased to 2.0%. The more favorable lease terms are expected to reduce the Company’s cumulative rent obligations by $143.0 million through January 2032. As part of the transaction, the Company issued (2) five-year notes totaling $23.7 million to Welltower. The first note is a convertible note for $12.0 million and has a maturity date of December 15, 2021. The note is exchangeable for 3.0 million shares of common stock. The second note is a non-convertible note for $11.7 million and has a maturity date of December 15, 2021. See Note 10 – “Long-Term Debt – Notes Payable .” The new master leases resulted in a reduction in financing obligation of $208.9 million, a step-down in capital lease asset and obligation of $21.4 million, establishment of notes payable of $74.8 million and a gain on leased facilities sold to new landlord and operating under new lease agreements of $134.1 million, which is included in other income on the consolidated statements of operations. See Note 18 – “ Other Income .” |
Loss Per Share
Loss Per Share | 12 Months Ended |
Dec. 31, 2016 | |
Loss Per Share | |
Loss Per Share | (5) The Company has three classes of common stock. Classes A and B are identical in economic and voting interests. Class C has a 1:1 voting ratio with each of the other two classes, representing the voting interests of the noncontrolling interest of the legacy FC-GEN owners. See Note 4 – “ Significant Transactions and Events – the Combination with Skilled .” Class C common stock is a participating security; however, it shares in a de minimis economic interest and is therefore excluded from the denominator of the basic earnings (loss) per share (EPS) calculation. Basic EPS was computed by dividing net loss by the weighted-average number of outstanding common shares for the period. Diluted EPS is computed by dividing loss plus the effect of assumed conversions (if applicable) by the weighted-average number of outstanding shares after giving effect to all potential dilutive common stock. A reconciliation of the numerator and denominator used in the calculation of basic net loss per common share follows (in thousands, except per share data): Year ended December 31, 2016 2015 2014 Numerator: Loss from continuing operations $ $ $ Less: Net (loss) income attributable to noncontrolling interests Loss from continuing operations attributable to Genesis Healthcare, Inc. $ $ $ Income (loss) from discontinued operations, net of taxes Net loss attributable to Genesis Healthcare, Inc. $ $ $ Denominator: Weighted-average shares outstanding for basic net loss per share Basic net loss per common share: Loss from continuing operations attributable to Genesis Healthcare, Inc. $ $ $ (Loss) income from discontinued operations, net of taxes Net loss attributable to Genesis Healthcare, Inc. $ $ $ A reconciliation of the numerator and denominator used in the calculation of diluted net loss per common share follows (in thousands, except per share data): Year ended December 31, 2016 2015 2014 Numerator: Loss from continuing operations $ $ $ Less: Net (loss) income attributable to noncontrolling interests Loss from continuing operations attributable to Genesis Healthcare, Inc. $ $ $ Income (loss) from discontinued operations, net of taxes Net loss attributable to Genesis Healthcare, Inc. $ $ $ Plus: Exchange of restricted stock units of noncontrolling interests — — Net loss available to common stockholders after assumed conversions $ $ $ Denominator: Weighted-average shares outstanding for diluted net loss per share Effect of dilutive shares: Exchange of restricted stock units of noncontrolling interests — — Employee and director unvested restricted stock units — — Dilutive potential common shares — — Adjusted weighted-average common shares outstanding, diluted Diluted net loss per common share: Loss from continuing operations attributable to Genesis Healthcare, Inc. $ $ $ Loss income from discontinued operations, net of taxes Net loss attributable to Genesis Healthcare, Inc. $ $ $ The following were excluded from net income attributable to Genesis Healthcare, Inc. and the weighted-average diluted shares computation for the years ended December 31, 2016, 2015 and 2014, as their inclusion would have been anti-dilutive (in thousands): Year ended December 31, 2016 2015 2014 Net loss Net loss Net loss attributable to attributable to attributable to Genesis Antidilutive Genesis Antidilutive Genesis Antidilutive Healthcare, Inc. shares Healthcare, Inc. shares Healthcare, Inc. shares Exchange of restricted stock units of noncontrolling interests $ — — $ $ — — Employee and director unvested restricted stock units — — — — Convertible notes — — — — As of December 31, 2016, there were 63,849,380 units attributed to the noncontrolling interests outstanding. See Note 4 – “ Significant Transactions and Events – the Combination with Skilled .” In addition to the outstanding units attributed to the noncontrolling interests, the conversion of all of those units will result in the issuance of an incremental 11,117 shares of Class A common stock. In the year ended December 31, 2016, 984,849 and 90,914 shares vested and 886,056 and 90,914 were issued with respect to the June 3, 2015 and October 26, 2015 grants. On June 8, 2016, 4,339,932 restricted stock awards were granted to employees and 360,000 restricted stock awards to non-employee directors. On August 5, 2016, an additional 503,834 restricted stock awards were granted to employees. In the year ended December 31, 2016, the Company issued a debt instrument which is convertible into 3,000,000 shares of Class A Common stock. Because the Company is in a net loss position for the year ended December 31, 2016, the impact of the assumed conversion of the convertible debt to common stock and the related tax implications are anti-dilutive to EPS. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2016 | |
Segment Information | |
Segment Information | (6) The Company has three reportable operating segments: (i) inpatient services; (ii) rehabilitation therapy services; and (iii) other services. For additional information on these reportable segments see Note 1 – “ General Information – Description of Business .” A summary of the Company’s segmented revenues follows: Year ended December 31, 2016 2015 Increase / (Decrease) Revenue Revenue Revenue Revenue Dollars Percentage Dollars Percentage Dollars Percentage (in thousands, except percentages) Revenues: Inpatient services: Skilled nursing facilities $ % $ % $ % Assisted/Senior living facilities % % % Administration of third party facilities % % % Elimination of administrative services — % — % % Inpatient services, net % % % Rehabilitation therapy services: Total therapy services % % % Elimination intersegment rehabilitation therapy services % % % Third party rehabilitation therapy services % % % Other services: Total other services % % % Elimination intersegment other services % % % Third party other services % % % Net revenues $ % $ % $ % Year ended December 31, 2015 2014 Increase / (Decrease) Revenue Revenue Revenue Revenue Dollars Percentage Dollars Percentage Dollars Percentage (in thousands, except percentages) Revenues: Inpatient services: Skilled nursing facilities $ % $ % $ % Assisted/Senior living facilities % % % Administration of third party facilities % % % Elimination of administrative services — % — % % Inpatient services, net % % % Rehabilitation therapy services: Total therapy services % % % Elimination intersegment rehabilitation therapy services % % % Third party rehabilitation therapy services % % % Other services: Total other services % % % Elimination intersegment other services % % % Third party other services % % % Net revenues $ % $ % $ % A summary of the Company’s condensed consolidated statement of operations follows: Year ended December 31, 2016 Rehabilitation Inpatient Therapy Other Services Services Services Corporate Eliminations Consolidated (In thousands) Net revenues $ $ $ $ $ $ Salaries, wages and benefits — — Other operating expenses — General and administrative costs — — — — Provision for losses on accounts receivable — Lease expense — Depreciation and amortization expense — Interest expense — Loss on extinguishment of debt — — — — Investment income — — — — Other income — — — — Transaction costs — — — — Long-lived asset impairments — — — — Skilled Healthcare and other loss contingency expense — — — — Equity in net (income) loss of unconsolidated affiliates — — — (Loss) income before income tax benefit Income tax benefit — — — — (Loss) income from continuing operations $ $ $ $ $ $ Year ended December 31, 2015 Rehabilitation Inpatient Therapy Other Services Services Services Corporate Eliminations Consolidated (In thousands) Net revenues $ $ $ $ $ $ Salaries, wages and benefits — — Other operating expenses — General and administrative costs — — — — Provision for losses on accounts receivable — Lease expense Depreciation and amortization expense — Interest expense Loss on extinguishment of debt — — — — Investment (income) loss — — — Other income — — — — Transaction costs — — — — Long-lived asset impairments — — — — Skilled Healthcare and other loss contingency expense — — — — Equity in net (income) loss of unconsolidated affiliates — — — (Loss) income before income tax expense Income tax expense — — — — (Loss) income from continuing operations $ $ $ $ $ $ Year ended December 31, 2014 Rehabilitation Inpatient Therapy Other Services Services Services Corporate Eliminations Consolidated (In thousands) Net revenues $ $ $ $ $ $ Salaries, wages and benefits — — Other operating expenses — General and administrative costs — — — — Provision for losses on accounts receivable — Lease expense — Depreciation and amortization expense — Interest expense Loss on extinguishment of debt — — — — Investment income — — — Other income — — — — Transaction costs — — — — Long-lived asset impairments — — — — Equity in net (income) loss of unconsolidated affiliates — — — (Loss) income before income tax benefit Income tax benefit — — — — (Loss) income from continuing operations $ $ $ $ $ $ The following table presents the segment assets as of December 31, 2016 compared to December 31, 2015 (in thousands): December 31, 2016 December 31, 2015 Inpatient services $ $ Rehabilitation services Other services Corporate and eliminations Total assets $ $ The following table presents segment goodwill as of December 31, 2016 compared to December 31, 2015 (in thousands): December 31, 2016 December 31, 2015 Inpatient services $ $ Rehabilitation services Other services Total goodwill $ $ With the sale of the Company’s hospice and home health operations effective May 1, 2016, the Company derecognized goodwill of $27.4 million. See Note 4 – “ Significant Transactions and Events – Sale of Hospice and Home Health .” |
Restricted Cash and Investments
Restricted Cash and Investments in Marketable Securities | 12 Months Ended |
Dec. 31, 2016 | |
Restricted Cash and Investments in Marketable Securities [Abstract] | |
Restricted Cash and Investments in Marketable Securities | (7) The current portion of restricted cash and investments in marketable securities principally represents an estimate of the level of outstanding self-insured losses the Company expects to pay in the succeeding year through its wholly owned captive insurance company. See Note 21 – “ Commitments and Contingencies – Loss Reserves For Certain Self-Insured Programs .” Restricted cash and investments in marketable securities at December 31, 2016 consist of the following (in thousands): Unrealized losses Amortized Unrealized Less than Greater than cost gains 12 months 12 months Fair value Restricted cash and equivalents: Cash $ $ — $ — $ — $ Money market funds — — — Restricted investments in marketable securities: Mortgage/government backed securities Corporate bonds Government bonds $ $ $ $ Less: Current portion of restricted investments Long-term restricted investments $ Restricted cash and investments in marketable securities at December 31, 2015 consist of the following (in thousands): Unrealized losses Amortized Unrealized Less than Greater than cost gains 12 months 12 months Fair value Restricted cash and equivalents: Cash $ $ — $ — $ — $ Money market funds — — — Restricted investments in marketable securities: Mortgage/government backed securities — — Corporate bonds Government bonds $ $ $ $ Less: Current portion of restricted investments Long-term restricted investments $ Maturities of restricted investments yielded proceeds of $38.6 million, $26.2 million and $22.9 million for the years ended December 31, 2016, 2015 and 2014, respectively. Sales of investments yielded proceeds of $34.1 million, $15.1 million and $7.3 million for the years ended December 31, 2016, 2015 and 2014, respectively. Associated gross realized gain and (loss) for the year ended December 31, 2016 were $0.5 million and $(0.9) million, respectively. Associated gross realized gain and (loss) for the year ended December 31, 2015 were $0.1 million and $(0.8) million, respectively. Associated gross realized gain and (loss) for the year ended December 31, 2014 were $0.8 million and $(0.3) million, respectively. The majority of the Company’s investments are investment grade government and corporate debt securities that have maturities of five years or less, and the Company has both the ability and intent to hold the investments until maturity. Restricted investments in marketable securities held at December 31, 2016 mature as follows (in thousands): Amortized Fair cost value Due in one year or less $ $ Due after 1 year through 5 years Due after 5 years through 10 years $ $ Actual maturities may differ from stated maturities because borrowers may have the right to call or prepay certain obligations and may exercise that right with or without prepayment penalties. The Company has issued letters of credit totaling $123.2 million at December 31, 2016 to its third party administrators and the Company’s excess insurance carriers. Restricted cash of $9.4 million and restricted investments with an amortized cost of $143.8 million and a market value of $142.9 million are pledged as security for these letters of credit as of December 31, 2016. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | (8) Property and equipment consisted of the following as of December 31, 2016 and December 31, 2015 (in thousands): December 31, 2016 December 31, 2015 Land, buildings and improvements $ $ Capital lease land, buildings and improvements Financing obligation land, buildings and improvements Equipment, furniture and fixtures Construction in progress Gross property and equipment Less: accumulated depreciation Net property and equipment $ $ For the years ended December 31, 2016 and 2015, the Company recognized long-lived impairment charges of $32.1 million and $26.8 million, respectively. In the fourth quarter of 2016, the Company entered into a purchase and sale agreement to sell 18 facilities ( 16 owned and 2 leased) in the states of Kansas, Missouri, Nebraska and Iowa. The assets and liabilities of the 16 owned facilities subject to sale have been presented as assets held for sale at December 31, 2016. See Note 20 – “ Assets Held for Sale and Discontinued Operations .” $70.8 million and $16.5 million has been reclassified from “land, buildings and improvements” and “equipment, furniture and fixtures”, respectively, at December 31, 2016. |
Goodwill and Identifiable Intan
Goodwill and Identifiable Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Identifiable Intangible Assets | (9) The changes in the carrying value of goodwill are as follows (in thousands): Total Balance at December 31, 2014 $ Skilled Combination Acquisition from Revera Other goodwill additions Balance at December 31, 2015 $ Acquisition from Revera Sale of hospice and home health Goodwill associated with assets held for sale Other goodwill additions Balance at December 31, 2016 $ The Company has no accumulated amortization of goodwill. Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Identifiable intangible assets consist of the following at December 31, 2016 and 2015 (in thousands): 2016 Weighted Average Remaining Life (Years) Customer relationship assets, net of accumulated amortization of $43,862 $ 9 Management contracts, net of accumulated amortization of $17,872 2 Favorable leases, net of accumulated amortization of $29,421 10 Trade names Indefinite Identifiable intangible assets $ 2015 Weighted Average Remaining Life (Years) Customer relationship assets, net of accumulated amortization of $34,336 $ 10 Management contracts, net of accumulated amortization of $8,093 3 Favorable leases, net of accumulated amortization of $24,141 10 Trade names Indefinite Identifiable intangible assets $ Acquisition-related identified intangible assets consist of customer relationship assets, management contracts, favorable lease contracts and trade names. Customer relationship assets exist in the Company’s rehabilitation services, respiratory services, management services and medical staffing businesses. These assets are amortized on a straight-line basis over the expected period of benefit. Management contracts are derived through the organization of facilities under an upper payment limit supplemental payment program in Texas that provides supplemental Medicaid payments with federal matching funds for skilled nursing facilities that are affiliated with county-owned hospital districts. Under this program, the Company acts as the manager of the facilities and shares in these supplemental payments with the county hospitals. These assets are amortized on a straight-line basis over the management contract life. Favorable lease contracts represent the estimated value of future cash outflows of operating lease contracts compared to lease rates that could be negotiated in an arms-length transaction at the time of measurement. Favorable lease contracts are amortized on a straight-line basis over the lease terms. The Company’s trade names have value, in particular in the rehabilitation business which markets its services to other providers of skilled nursing and assisted/senior living services. The trade name asset has an indefinite life and is measured no less than annually or if indicators of potential impairment become apparent. Amortization expense from continuing operations related to customer relationship assets, which is included in depreciation and amortization expense, for the years ended December 31, 2016, 2015 and 2014 was $10.3 million, $10.3 million and $9.1 million, respectively. Amortization expense from continuing operations related to management contracts, which is included in depreciation and amortization expense, for the years ended December 31, 2016, 2015 and 2014 was $9.0 million, $8.1 million and $0.0 million, respectively. Amortization expense from continuing operations related to favorable leases, which is included in lease expense, for the years ended December 31, 2016, 2015 and 2014 was $8.1 million, $8.4 million and $9.3 million, respectively. Based upon amounts recorded at December 31, 2016, total estimated amortization expense of identifiable intangible assets will be $26.4 million in 2017, $22.3 million in 2018, $16.8 million in 2019, $11.4 million in 2020, and $10.5 million in 2021 and $37.5 million, thereafter. Asset impairment charges of $3.3 million, $1.8 million and $3.0 million were recognized on favorable lease assets in the years ended December 31, 2016, 2015 and 2014 associated with the write-down of underperforming properties. See Note 19 – “ Asset Impairment Charges – Long-Lived Assets with a Definite Useful Life .” |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2016 | |
Long-Term Debt Abstract | |
Long-Term Debt | (10) Long-term debt at December 31, 2016 and December 31, 2015 consisted of the following (in thousands): December 31, December 31, 2016 2015 Revolving credit facilities, net of debt issuance costs of $9,220 at December 31, 2016 and $10,254 at December 31, 2015 $ $ Term loan facility, net of original issue discount of $7,475 and net of debt issuance costs of $10,129 at December 31, 2015 — New term loan agreement, net of debt issuance costs of $3,859 at December 31, 2016 — Real estate bridge loans, net of debt issuance costs of $4,400 at December 31, 2016 and $9,567 at December 31, 2015 HUD insured loans, net of debt issuance costs of $4,773 at December 31, 2016 and $1,395 at December 31, 2015 Notes payable, net of convertible debt discount of $990 at December 31, 2016 — Mortgages and other secured debt (recourse) Mortgages and other secured debt (non-recourse), net of debt issuance costs of $131 at December 31, 2016 and $176 at December 31, 2015 Less: Current installments of long-term debt Long-term debt $ $ Revolving Credit Facilities In connection with the Combination, on February 2, 2015 the Company entered into new revolving credit facilities and terminated its former revolving credit facilities. The new revolving credit facilities (the Revolving Credit Facilities) consist of a senior secured, asset-based revolving credit facility of up to $550 million under four separate tranches: Tranche A-1, Tranche A-2, FILO Tranche and HUD Tranche. Interest accrues at a per annum rate equal to either (x) a base rate (calculated as the highest of the (i) prime rate, (ii) the federal funds rate plus 3.00%, or (iii) LIBOR plus the excess of the applicable margin between LIBOR loans and base rate loans) plus an applicable margin or (y) LIBOR plus an applicable margin. The applicable margin is based on the level of commitments for all four tranches, and in regards to LIBOR loans (i) for Tranche A-1 ranges from 3.25% to 2.75%; (ii) for Tranche A-2 ranges from 3.00% to 2.50%; (iii) for FILO Tranche is 5.00%; and (iv) for HUD Tranche is from 3.00% to 2.5%. The Revolving Credit Facilities mature on February 2, 2020. Borrowing levels under the Revolving Credit Facilities are limited to a borrowing base that is computed based upon the level of the Company’s eligible accounts receivable, as defined therein. In addition to paying interest on the outstanding principal borrowed under the Revolving Credit Facilities, the Company is required to pay a commitment fee to the lenders for any unutilized commitments. The commitment fee rate ranges from 0.375% per annum to 0.50% depending upon the level of unused commitment. On July 29, 2016, the Company entered into an amendment (the ABL Amendment) to its Revolving Credit Facilities. Among other things, the ABL Amendment (i) modifies financial covenants to provide additional flexibility to the Company; (ii) permits the Company to enter into certain other transactions; (iii) permits quarterly amortization of the FILO Tranche at the option of lenders through 2017; and (iv) increases the interest rate margin applicable to the revolving loans under the ABL Credit Agreement (the New Applicable Margin). The New Applicable Margin for LIBOR loans increased (i) for Tranche A-1 loans, from a range of 2.75% to 3.25% to a range of 3.00% to 3.50%; (ii) for Tranche A-2 loans, from a range of 2.50% to 3.00% to a range of 3.00% to 3.50%; (iii) for FILO Tranche, from 5.00% to 6.00%; and (iv) the HUD Tranche was not amended. The New Applicable Margin for Base Rate (calculated as the highest of the (i) prime rate, (ii) the federal funds rate plus 3.00%, or (iii) LIBOR plus the excess of the applicable margin between LIBOR loans and base rate loans) loans increased (i) for Tranche A-1 loans, from a range of 1.75% to 2.25% to a range of 2.00% to 2.50%, (ii) for Tranche A-2 loans, from a range of 1.50% to 2.00% to a range of 2.00% to 2.50%; (iii) for FILO Tranche, from 4.00% to 5.00%; and (iv) the HUD Tranche was not amended remaining at a range of 1.50% to 2.00%. The amended Revolving Credit Facilities contain financial, affirmative and negative covenants, and events of default that are substantially identical to those of the New Term Loan Agreement (as defined below), but also contain a minimum liquidity covenant and a springing minimum fixed charge coverage covenant tied to the minimum liquidity requirement. The most restrictive financial covenant is the maximum leverage ratio which requires the Company to maintain a leverage ratio, as defined, of no more than 6.0 to 1.0 through March of 2017 and stepping down over the course of the loan to 4.0 to 1.0 beginning in 2020. Borrowings and interest rates under the four tranches were as follows at December 31, 2016: Weighted Average Revolving Credit Facilities Commitment Borrowings Interest FILO tranche $ $ % Tranche A-1 % Tranche A-2 % HUD tranche % $ $ % As of December 31, 2016, the Company had a total borrowing base capacity of $521.6 million with outstanding borrowings under the Revolving Credit Facilities of $392.9 million and had $59.2 million of drawn letters of credit securing insurance and lease obligations, leaving the Company with approximately $69.5 million of available borrowing capacity under the Revolving Credit Facilities. Term Loan Facility and New Term Loan Agreement Prior to the Combination, FC-GEN and certain of its subsidiaries became party to a five-year term loan facility (the Term Loan Facility). The Term Loan Facility was secured by a first priority lien on the membership interests in FC-GEN and on substantially all of the Company’s and its subsidiaries’ assets other than collateral held on a first priority basis by the Revolving Credit Facilities lender. Borrowings under the Term Loan Facility bore interest at a rate per annum equal to the applicable margin plus, at the Company’s option, either (x) LIBOR or (y) a base rate determined by reference to the highest of (i) the lender defined prime rate, (ii) the federal funds rate effective plus one half of one percent and (iii) LIBOR described in subclause (x) plus 1.0%. LIBOR based loans were subject to an interest rate floor of 1.5% and base rate loans were subject to a floor of 2.5%. The Term Loan Facility was set to mature on the earliest of (i) December 4, 2017 and (ii) 90 days prior to the maturity of the Skilled Real Estate Bridge Loan, including extensions. On July 29, 2016, the Company paid the outstanding balance of $153.4 million under the Term Loan Facility. In addition, the Company paid an early termination fee of approximately $3.1 million. The Term Loan Facility and all guarantees and liens related thereto were terminated upon such payments. On July 29, 2016, the Company and certain of its affiliates, including FC-GEN Operations Investment, LLC (the Borrower) entered into a four-year term loan agreement (the New Term Loan Agreement) with an affiliate of Welltower Inc. (Welltower) and an affiliate of Omega Healthcare Investors, Inc. (Omega). The New Term Loan Agreement provides for term loans (the New Term Loans) in the aggregate principal amount of $120.0 million, with scheduled annual amortization of 2.5% of the initial principal balance in years one, two and three, and 5.0% in year four. Borrowings under the New Term Loan Agreement bear interest at a rate equal to a LIBOR rate (subject to a floor of 1.00%) or an ABR rate (subject to a floor of 2.0%), plus in each case a specified applicable margin. The initial applicable margin for LIBOR loans is 13.0% per annum and the initial applicable margin for ABR rate loans is 12.0% per annum. At the Company’s election, with respect to either LIBOR or ABR rate loans, up to 2.0% of the interest may be paid either in cash or paid-in-kind. The applicable interest rate on this loan was 14.0% as of December 31, 2016, with 2.0% of the interest to be paid-in-kind. The proceeds of the New Term Loan, along with cash on hand, were used to repay all outstanding term loans and other obligations under the Term Loan Facility. As of December 31, 2016, the New Term Loans had an outstanding principal balance of $120.0 million. The New Term Loan Agreement is secured by a first priority lien on the equity interests of the subsidiaries of the Company and the Borrower as well as certain other assets of the Company, the Borrower and their subsidiaries, subject to certain exceptions. The New Term Loan Agreement is also secured by a junior lien on the assets that secure the Revolving Credit Facilities, as amended, on a first priority basis. Welltower and Omega, or their respective affiliates, are each currently landlords under certain master lease agreements to which the Company and/or its affiliates are tenants. The New Term Loan Agreement contains financial, affirmative and negative covenants, and events of default that are customary for debt securities of this type. Financial covenants include four maintenance covenants which require the Company to maintain a maximum leverage ratio, a minimum interest coverage ratio, a minimum fixed charge coverage ratio and maximum capital expenditures. The most restrictive financial covenant is the maximum leverage ratio which requires the Company to maintain a leverage ratio, as defined therein, of no more than 6.0 to 1.0 through March of 2017 and stepping down over the course of the loan to 4.0 to 1.0 beginning in 2020. Real Estate Bridge Loans In connection with the Combination on February 2, 2015, the Company entered into a $360.0 million real estate bridge loan (the Skilled Real Estate Bridge Loan), which was secured by a mortgage lien on the real property of the facilities and a second lien on certain receivables of the operators of such facilities. The Skilled Real Estate Bridge Loan was subject to a 24-month term with two extension options of 90-days each and accrued interest at a rate equal to LIBOR, plus 6.75%, plus an additional margin that ranged up to 7.50% based on the aggregate number of days the Skilled Real Estate Bridge Loan was outstanding. The interest rate was also subject to a LIBOR interest rate floor of 0.5%. The Skilled Real Estate Bridge Loan was subject to payments of interest only during the term with a balloon payment due at maturity, provided, that to the extent the subsidiaries receive any net proceeds from the sale and / or refinance of the underlying facilities such net proceeds were required to be used to repay the outstanding principal balance of the Skilled Real Estate Bridge Loan. The proceeds of the Skilled Real Estate Bridge Loan were used to repay Skilled’s first lien senior secured term loan, repay Skilled’s mortgage loans and asset based revolving credit facility with MidCap Financial with excess proceeds used to fund direct costs of the Combination with the Company. In connection with the acquisition of Revera on December 1, 2015, the Company entered into a $134.1 million real estate bridge loan (the Revera Real Estate Bridge Loan). On September 1, 2016, the Company acquired another five skilled nursing facilities from Revera drawing on the remaining available commitment of the Revera Real Estate Bridge Loan of $37.0 million. The Revera Real Estate Bridge Loan was secured by a mortgage lien on the real property of the 20 facilities and subject to a 24-month term with two extension options of 90-days each and accrued interest at a rate equal to LIBOR, plus 6.75%, plus an additional margin that ranges up to 7.00% based on the aggregate number of days the Revera Real Estate Bridge Loan is outstanding, plus 0.25% multiplied by the result of dividing the number of percentage points by which the loan-to-value ratio, defined as the ratio, expressed as a percentage, of (i) the outstanding principal balance to (ii) the total appraised value of the facilities as of the closing date, exceeds 75% by five. The interest rate is also subject to a LIBOR interest rate floor of 0.5%. The Revera Real Estate Bridge Loan was subject to payments of interest only during the term with a balloon payment due at maturity, provided, that to the extent the subsidiaries receive any net proceeds from the sale and / or refinance of the underlying facilities such net proceeds were required to be used to repay the outstanding principal balance of the Revera Real Estate Bridge Loan. The proceeds of the Revera Real Estate Bridge Loan were used to finance the acquisition of the 20 Revera facilities. On December 22, 2016, the Skilled Real Estate Bridge Loan and the Revera Real Estate Bridge Loan were refinanced splitting the combined outstanding balances of $317.0 million associated with the two bridge loans into four separate bridge loan agreements (Welltower Bridge Loans). The Welltower Bridge Loans have an effective date of October 1, 2016. The Welltower Bridge Loans are subject to payments of interest only during the term with a balloon payment due at maturity, provided, that to the extent the subsidiaries receive any net proceeds from the sale and / or refinance of the underlying facilities such net proceeds were required to be used to repay the outstanding principal balance of the Welltower Bridge Loans. Each Welltower Bridge Loan has a maturity date of January 1, 2022 and a 10.0% interest rate that increases annually by 0.25% beginning January 1, 2018. The Welltower Bridge Loans are secured by a mortgage lien on the real property of the 45 facilities and a second lien on certain receivables of the operators of 27 of the facilities. The Welltower Bridge Loans have an outstanding principal balance of $317.0 million at December 31, 2016. One of the Welltower Bridge Loans includes the debt associated with three skilled nursing facilities that have been reclassified as assets held for sale in the consolidated balance sheets at December 31, 2016. This Welltower Bridge Loan has a principal balance of $9.0 million. See Note 20 – “Assets Held for Sale and Discontinued Operations.” On April 1, 2016, the Company acquired one skilled nursing facility and entered into a $9.9 million real estate bridge loan. On May 23, 2016, the Company acquired the real property of five skilled nursing facilities it operated under a leasing arrangement and entered into a $44.0 million real estate bridge loan (collectively, the Other Real Estate Bridge Loans). The Other Real Estate Bridge Loan associated with the May 23, 2016 acquisition of five skilled nursing facilities was retired fully and refinanced through a HUD insured loan on November 30, 2016. The remaining Other Real Estate Bridge Loan has a term of three years and accrues interest at a rate equal to LIBOR plus a margin of 4.00%. The remaining Other Real Estate Bridge Loan bore interest of approximately 4.77% at December 31, 2016. The remaining Other Real Estate Bridge Loan is subject to payments primarily of interest only, with some principal payments in the second and third years, during the term with a balloon payment due at its April 1, 2019 maturity, provided, that to the extent the subsidiaries receive any net proceeds from the sale and/or refinance of the underlying facilities such net proceeds are required to be used to pay down the outstanding principal balance of the Other Real Estate Bridge Loan. The Other Real Estate Bridge Loans have an outstanding principal balance of $9.9 million at December 31, 2016. HUD Insured Loans In connection with the Combination on February 2, 2015, the Company assumed certain obligations under 10 loans insured by the U.S. Department of Housing and Urban Development (HUD). The loans are secured by 10 of the Company’s skilled nursing facilities that were acquired in the Combination. The HUD insured loans have an original amortization term of 30 to 35 years. On May 1, 2015, the Company acquired a facility in Texas and assumed its HUD insured loan totaling $8.4 million with a maturity date of January 1, 2049. Beginning in 2016, the Company began refinancing efforts converting debt subject to real estate bridge loans to HUD insured loans. As of December 31, 2016, the Company has 39 skilled nursing facility loans insured by HUD. The HUD insured loans have a combined aggregate principal balance of $309.7 million, which includes a $14.1 million debt premium established in purchase accounting in connection with the Combination. Of the 39 HUD insured skilled nursing facilities, 13 have been reclassified as assets held for sale in the consolidated balance sheets at December 31, 2016. These 13 skilled nursing facilities have an aggregate principal balance of $63.4 million. See Note 20 – “Assets Held for Sale and Discontinued Operations.” These loans have an average remaining term of 31 years with fixed interest rates ranging from 3.0% to 4.6% and a weighted average interest rate of 3.5%. Depending on the mortgage agreement, prepayments are generally allowed only after 12 months from the inception of the mortgage. Prepayments are subject to a penalty of 10% of the remaining principal balances in the first year and the prepayment penalty decreases each subsequent year by 1% until no penalty is required. Any further HUD insured loans will require additional HUD approval. All HUD insured loans are non-recourse loans to the Company. All loans are subject to HUD regulatory agreements that require escrow reserve funds to be deposited with the loan servicer for mortgage insurance premiums, property taxes, insurance and for capital replacement expenditures. As of December 31, 2016, the Company has total escrow reserve funds of $21.7 million with the loan servicer that are reported within prepaid expenses. Notes Payable In connection with Welltower’s sale of 64 skilled nursing facilities to Second Spring on November 1, 2016, the Company issued a note totaling $51.2 million to Welltower. The note accrues cash interest at 3% and paid-in-kind interest at 7%. Cash interest is paid and paid-in-kind interest accretes the principal amount semi-annually every May 1 and November 1. The note matures on October 30, 2020. The note has an outstanding balance of $51.2 million at December 31, 2016. In connection with Welltower’s sale of 28 skilled nursing facilities to CBYW on December 23, 2016, the Company issued two notes totaling $23.7 million to Welltower. The first note has an initial principal balance of $11.7 million and accrues cash interest at 3% and paid-in-kind interest at 7%. Cash interest is paid and paid-in-kind interest accretes the principal amount semi-annually every June 15 and December 15. The note matures on December 15, 2021. The note has an outstanding accreted principal balance of $11.7 million at December 31, 2016. The second note has an initial principal balance of $12.0 million and accrues cash interest at 3% and paid-in-kind interest at 3%. Cash interest is paid and paid-in-kind interest accretes the principal amount semi-annually every June 15 and December 15. From the second anniversary up to the day before the note matures, CBYW can convert all or any portion of the note into fully paid shares of common stock at the conversion rate of 3,000,000 shares of common stock per the full accreted principal amount of the note. The note matures on December 15, 2021. The note has an outstanding accreted principal balance of $12.0 million at December 31, 2016. See Note 4 – “ Significant Transactions and Events – New Master Leases.” Other Debt Mortgages and other secured debt (recourse). The Company carries mortgage loans and notes payable on certain of its corporate office buildings and other acquired assets. The loans are secured by the underlying real property and have fixed or variable rates of interest ranging from 2.5% to 6.0% at December 31, 2016, with maturity dates ranging from 2018 to 2020. Mortgages and other secured debt (non-recourse). Loans are carried by certain of the Company’s consolidated joint ventures. The loans consist principally of revenue bonds and secured bank loans. Loans are secured by the underlying real and personal property of individual facilities and have fixed or variable rates of interest ranging from 2.5% to 22.2% at December 31, 2016, with maturity dates ranging from 2018 to 2034. Loans are labeled “ non-recourse” because neither the Company nor any of its wholly owned subsidiaries is obligated to perform under the respective loan agreements. Debt Covenants The Revolving Credit Facilities, the New Term Loan Agreement, the Real Estate Bridge Loans and the Notes Payable (collectively, the Credit Facilities) each contain a number of restrictive covenants that, among other things, impose operating and financial restrictions on the Company and its subsidiaries. The Credit Facilities also require the Company to meet defined financial covenants, including interest coverage ratio, a maximum consolidated net leverage ratio and a minimum consolidated fixed charge coverage ratio, all as defined in the applicable agreements. The Credit Facilities also contain other customary covenants and events of default and cross default. As of December 31, 2016, the Company is in compliance with all covenants contained in the Credit Facilities. The Company’s ability to maintain compliance with its debt covenants depends in part on management’s ability to increase revenue and control costs. Should the Company fail to comply with its debt covenants at a future measurement date, it could, absent necessary and timely waivers and/or amendments, be in default under certain of its existing credit agreements. To the extent any cross-default provisions may apply, the default could have an even more significant impact on the Company’s financial position. Although the Company is in compliance and projects to be in compliance with its material debt covenants through March 31, 2018, the ongoing uncertainty related to the impact of healthcare reform initiatives may have an adverse impact on the Company’s ability to remain in compliance with its covenants. Such uncertainty includes, changes in reimbursement patterns, patient admission patterns, bundled payment arrangements, as well as potential changes to the Affordable Care Act currently being considered in Congress, among others. There can be no assurance that the confluence of these and other factors will not impede the Company’s ability to meet its debt covenants in the future. Management has considered these factors and has devised certain strategies that would be implemented to address the ramifications of these uncertainties. Such strategies include, but are not limited to, cost containment measures and possible divestitures of less profitable facilities. The maturity of total debt of $1,251.1 million, excluding debt issuance costs and other non-cash debt discounts and premiums, at December 31, 2016 is as follows (in thousands): Twelve months ended December 31, 2017 $ 2018 2019 2020 2021 Thereafter Total debt maturity $ |
Leases and Lease Commitments
Leases and Lease Commitments | 12 Months Ended |
Dec. 31, 2016 | |
Leases and Lease Commitments | |
Leases and Lease Commitments | (11) The Company leases certain facilities under capital and operating leases. Future minimum payments for the next five years and thereafter under such leases at December 31, 2016 are as follows (in thousands): Twelve months ended December 31, Capital Leases Operating Leases 2017 $ $ 2018 2019 2020 2021 Thereafter Total future minimum lease payments $ Less amount representing interest Capital lease obligation Less current portion Long-term capital lease obligation $ Capital Lease Obligations The capital lease obligations represent the present value of minimum lease payments under such capital lease and cease use arrangements and bear imputed interest at rates ranging from 3.5% to 12.8% at December 31, 2016, and mature at dates ranging from 2017 to 2047. Deferred Lease Balances At December 31, 2016 and 2015, the Company had $43.0 million and $54.7 million, respectively, of favorable leases net of accumulated amortization, included in identifiable intangible assets, and $28.8 million and $35.5 million, respectively, of unfavorable leases net of accumulated amortization included in other long-term liabilities on the consolidated balance sheets. Favorable and unfavorable lease assets and liabilities, respectively, arise through the acquisition of leases in place which requires those contracts be recorded at their then fair value. The fair value of a lease is determined through a comparison of the actual rental rate with rental rates prevalent for similar assets in similar markets. A favorable lease asset to the Company represents a rental stream that is below market, and conversely an unfavorable lease is one with cost above market rates. These assets and liabilities amortize as lease expense over the remaining term of the respective leases on a straight-line basis. At December 31, 2016 and 2015, the Company had $31.6 million and $27.3 million, respectively, of deferred straight-line rent balances included in other long-term liabilities on the consolidated balance sheets. Lease Covenants Certain lease agreements contain a number of restrictive covenants that, among other things and subject to certain exceptions, impose operating and financial restrictions on the Company and its subsidiaries. These leases also require the Company to meet defined financial covenants, including a minimum level of consolidated liquidity, a maximum consolidated net leverage ratio and a minimum consolidated fixed charge coverage. On July 29, 2016, the Company entered into amendments to its master lease agreements with Welltower, Sabra Health Care REIT, Inc. (Sabra) and Omega (collectively, the Master Lease Amendments). Among other things, the Master Lease Amendments modified financial covenants to provide the Company with additional flexibility. The Master Lease Amendments each contain a number of financial, affirmative and negative covenants. As of December 31, 2016, the Company is in compliance with all covenants contained in the Master Lease Amendments. At December 31, 2016, the Company did not meet certain financial covenants contained in three leases related to 26 of its facilities. The Company is and expects to continue to be current in the timely payment of its obligations under such leases. These leases do not have cross default provisions, nor do they trigger cross default provisions in any of the Company’s other loan or lease agreements. The Company will continue to work with the related credit parties to amend such leases and the related financial covenants. The Company does not believe the breach of such financial covenants at December 31, 2016 will have a material adverse impact on it. The Company has been afforded certain cure rights to such defaults by posting collateral in the form of additional letters of credit or security deposit. The Company’s ability to maintain compliance with its lease covenants depends in part on management’s ability to increase revenue and control costs. Due to continuing changes in the healthcare industry, as well as the uncertainty with respect to changing referral patterns, patient mix, and reimbursement rates, it is possible that future operating performance may not generate sufficient operating results to maintain compliance with its quarterly lease covenant compliance requirements. Should the Company fail to comply with its lease covenants at a future measurement date, it could, absent necessary and timely waivers and/or amendments, be in default under certain of its existing lease agreements. To the extent any cross-default provisions may apply, the default could have an even more significant impact on the Company’s financial position. Although the Company is in compliance and projects to be in compliance with its material lease covenants through March 31, 2018, the ongoing uncertainty related to the impact of healthcare reform initiatives may have an adverse impact on the Company’s ability to remain in compliance with its covenants. Such uncertainty includes, changes in reimbursement patterns, patient admission patterns, bundled payment arrangements, as well as potential changes to the Affordable Care Act currently being considered in Congress, among others. There can be no assurance that the confluence of these and other factors will not impede the Company’s ability to meet its lease covenants in the future. Management has considered these factors and has devised certain strategies that would be implemented to address the ramifications of these uncertainties. Such strategies include, but are not limited to, cost containment measures and possible divestitures of less profitable facilities. |
Financing Obligation
Financing Obligation | 12 Months Ended |
Dec. 31, 2016 | |
Financing Obligation | |
Financing Obligation | (12) Financing obligations represent the present value of minimum lease payments under such lease arrangements and bear imputed interest at rates ranging from 1.2% to 27.8% at December 31, 2016, and mature at dates ranging from 2021 to 2043. Future minimum payments for the next five years and thereafter under leases classified as financing obligations at December 31, 2016 are as follows (in thousands): Twelve months ended December 31, 2017 $ 2018 2019 2020 2021 Thereafter Total future minimum lease payments Less amount representing interest Financing obligations $ Less current portion Long-term financing obligations $ The Company entered into two new master lease agreements in the fourth quarter of 2016, which resulted in a reduction in financing obligation of $208.9 million. See Note 4 – “ Significant Transactions and Events – New Master Leases.” |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Equity (Deficit) | (13) The total number of shares of all classes of stock that the Company shall have authority to issue is 1,200,000,000 consisting of: · 1,000,000,000 shares of Class A common stock, par value $0.001 per share, of which 75,187,388 shares and 73,593,732 shares were issued at December 31, 2016 and 2015, respectively; · 20,000,000 shares of Class B common stock, par value $0.001 per share, of which 15,495,019 shares and 15,511,603 shares were issued at December 31, 2016 and 2015, respectively; · 150,000,000 shares of Class C common stock, par value $0.001 per share, of which 63,849,380 shares and 64,449,380 shares were issued at December 31, 2016 and 2015, respectively; and · 30,000,000 shares of Preferred Stock, par value $0.001 per share, of which 0 shares were issued at December 31, 2016 and 2015, respectively. Capital Transactions with Stockholders and Noncontrolling Interests During the years ended December 31, 2016, 2015 and 2014, the Company distributed $0.2 million, $7.0 million and $18.0 million, respectively, to the stockholders and noncontrolling interests. These distributions represent tax payments made by the Company on the behalf of FC-GEN members. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | (14) The Company provides stock-based compensation to attract and retain employees while also aligning employees’ interests with the interests of its shareholders. The Genesis Healthcare, Inc. 2015 Omnibus Equity Incentive Plan (the 2015 Plan), which was approved by the Company’s shareholders in June 2015, provides that the Company may grant various cash-based and equity-based awards to key employees and directors. Restricted Stock Units (RSUs) and Performance Stock Units (PSUs) During 2016 and 2015, the Company granted RSUs and PSUs under the 2015 Plan, which are subject to vesting and other requirements as determined at the time of grant. These awards represent an obligation to deliver to the holder one share of the Company’s Class A Common Stock upon vesting. The fair value of stock-based award grants is amortized to expense over the vesting period, which is generally 3 years. RSUs are subject to service-based vesting criteria and generally vest in equal installments on each of the first three anniversaries from the date of grant. The fair value of RSUs is measured at the market price of the Company’s stock on the date of grant. PSUs are subject to service-based and market-based vesting criteria. Generally, these units vest on the third anniversary of the date of grant only if and to the extent certain market performance conditions are met. The fair value of PSUs subject to market-based vesting criteria is measured at the market price of the Company’s stock on the date prior to the grant date using the Monte-Carlo simulation option-pricing model. This model incorporates into the fair value determination the possibility that the market condition may not be satisfied. Compensation costs related to these awards are recognized regardless of whether the market condition is satisfied, provided that the requisite service has been provided. The Company’s Monte-Carlo fair value assumptions are as follows: December 31, 2016 December 31, 2015 Expected term, in years Risk-free interest rate Volatility 45% - 55% Dividends N/A N/A During the years ended December 31, 2016 and 2015, the following activity occurred with respect to RSUs and PSUs under the 2015 plan (number of shares in thousands): Number of Shares Weighted-Average Grant Date Fair Value RSU PSU RSU PSU Non-vested balance at January 1, 2015 — — $ — $ — Granted Vested — — Forfeited Non-vested balance at December 31, 2015 $ $ Granted Vested — — Forfeited Non-vested balance at December 31, 2016 $ $ As of December 31, 2016 and 2015, there were approximately $17.5 million and $19.4 million, respectively, of total unrecognized compensation costs related to unvested stock based compensation, which are expected to be recognized over a weighted average term of 1.72 years and 2.41 years, respectively. During 2016 and 2015, the fair value of stock-based compensation that vested was $2.2 million and less than $0.1 million, respectively. At December 31, 2016 and 2015, a total of 11.8 million shares and 16.5 million shares of the Company’s Class A Common Stock, respectively, are available for delivery under the 2015 Plan. The amount of compensation costs related to RSUs and PSUs included in general and administrative costs was $8.4 million and $4.7 million for the years ended December 31, 2016 and 2015, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | (15) The Company’s provision (benefit) for income taxes was based upon management’s estimate of taxable income or loss for each respective accounting period. The Company recognizes an asset or liability for the deferred tax consequences of temporary differences between the tax bases of assets including net operating loss and credit carryforwards and liabilities and the amounts reported in the financial statements. These temporary differences would result in taxable or deductible amounts in future years when the reported amounts of the assets are recovered or liabilities are settled. For the year ended December 31, 2014 and through February 2, 2015, the Company owned two separate corporate consolidated taxable groups: GHC Ancillary group and Sun group. Management calculates a separate provision for each group. The Company combines the provisions in its consolidated financial statements. On February 2, 2015, Skilled, along with its subsidiary healthcare companies (the Skilled Companies) and FC-GEN, along with its subsidiary companies (the Genesis HealthCare Companies) completed the Combination pursuant to which the businesses of the Skilled Companies and the Genesis HealthCare Companies were combined and now operate under the name Genesis Healthcare, Inc. The Internal Revenue Code imposes limitations on a corporation’s ability to utilize federal tax attributes (such as net unrealized built-in-deductions), including federal income tax credits, in the event of an “ownership change.” States may impose similar limitations. In general terms, an ownership change may result from transactions increasing the ownership of certain shareholders in the stock of a corporation by more than 50 percentage points over a three year period. The Combination generated such an ownership change. The Skilled Companies were treated as being purchased for accounting and tax purposes. As a result of the Combination, the tax bases of its assets and attributes such as net operating losses and tax credit carryforwards were carried over and subject to the provisions of IRC Sec. 382. As a result of the Combination, the Company effectively owns 58.7% of FC-GEN, an entity taxed as a partnership for U.S. income tax purposes. This is the Company’s only source of taxable income. The taxable income of the partnership is subject to the income allocation rules of IRC Sec. 704. Management believes the mechanics of IRC Sec. 704 will cause a greater portion of the temporary tax deductions to be allocated to the Company. This allocation will reduce the Company’s taxable income. Income Tax (Benefit) Provision Total income tax (benefit) expense was as follows (in thousands): Year ended December 31, 2016 2015 2014 Continuing operations $ $ $ Discontinued operations Noncontrolling interests — — Stockholder's deficit Total $ $ $ The components of the provision for income taxes on income (loss) from continuing operations for the periods presented were as follows (in thousands): Year ended December 31, 2016 2015 2014 Current: Federal $ $ $ State Deferred: Federal State Total $ $ $ At December 31, 2016, the current income taxes benefit was primarily generated from the release of a FIN 48 reserve the Company acquired in the acquisition of Sun Healthcare Group, Inc. The FIN 48 reserve was released due to the lapse of statute of limitations. At December 31, 2015 and 2014, the current income taxes were primarily generated on the taxable income of the Company’s rehabilitation services corporate subsidiary and the Company’s Bermuda captive insurance company. Beginning with the fourth quarter of 2014, the Company initiated rehabilitation therapy services within the People’s Republic of China. In the quarter ended March 31, 2016, the Company expanded rehabilitation therapy services within Hong Kong. At December 31, 2016, these business operations remain in their respective startup stage. Management does not anticipate these operations will generate taxable income in the near term. The operations currently do not have a material effect on the Company’s effective tax rate. In assessing the requirement for, and amount of, a valuation allowance in accordance with the more likely than not standard for all periods, the Company gives appropriate consideration to all positive and negative evidence related to the realization of the deferred tax assets. The assessment considers the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carryforward periods and the Company’s experience with operating loss and tax credit expirations. A history of cumulative losses is a significant piece of negative evidence used in the assessment. At December 31, 2016 and 2015, the Company has established a valuation allowance in the amount of $280.6 million and $245.1 million, respectively. The valuation allowance in 2016 and 2015 has been established due to management’s assessment that the Company will not realize its deferred tax assets. Therefore, management recorded a full valuation allowance against the majority of its net deferred tax assets in the amount of $280.6 million and $245.1 million, respectively, except for the discounted unpaid loss reserve deferred tax asset of the Company’s captive insurance company. Total income tax (benefit) expense for the periods presented differed from the amounts computed by applying the federal income tax rate of 35% to income (loss) before income taxes as illustrated below (in thousands): Year ended December 31, 2016 2015 2014 Computed “expected” benefit $ $ $ (Reduction) increase in income taxes resulting from: State and local income taxes, net of federal tax benefit Adjustment to income taxes for income not subject to corporate income tax — Income tax credits Non-controlling interest — Adjustment to deferred taxes, including credits and valuation allowance FIN 48 Other, net Total income tax (benefit) expense $ $ $ A significant portion of the Company’s 2016, 2015 and 2014 loss before taxes is not subject to corporate income tax. However, in many jurisdictions in which the Company operates, it is obligated to remit income taxes on behalf of its members. The Company recorded these payments as distributions to its stockholders. The Company’s effective income tax rate was 12.9% in 2016, (48.9)% in 2015 and 15.6% in 2014. The change in the effective income tax rate from 2015 to 2016 was largely due to the release of a FIN 48 reserve in 2016 and the establishment of a full valuation allowance in 2015. The change in the effective income tax rate from 2014 to 2015 was largely due to the establishment of a $221.9 million valuation allowance against its deferred tax assets. The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2016 and 2015 are presented below (in thousands): 2016 2015 Deferred tax assets: Investment in partnership Net operating loss carryforwards Discounted unpaid loss reserve Other intangible — General business credits Total deferred tax assets Valuation allowance Deferred tax assets, net of valuation allowance Deferred tax liabilities: Long-lived assets: intangible property Total deferred tax liabilities Net deferred tax liabilities Uncertain Tax Positions The Company follows the provisions of the authoritative guidance for accounting for uncertainty in income taxes which clarifies the accounting for uncertain income tax issues recognized in an entity’s financial statements. The guidance prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in an income tax return. The Company, excluding its corporate groups, is only subject to state and local income tax in certain jurisdictions. The Company’s corporate groups are subject to federal, state and local income taxes. Significant judgment is required in evaluating its uncertain tax positions and determining its provision for income taxes. Under GAAP, the Company utilizes a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. The Company is subject to various federal and state income tax audits in the ordinary course of business. Such audits could result in increased tax payments, interest and penalties. While the Company believes its tax positions are appropriate, it cannot assure that the various authorities engaged in the examination of its income tax returns will not challenge the Company’s positions. The Company believes it has adequately reserved for its uncertain tax positions, though no assurance can be given that the final tax outcome of these matters will not be different. The Company adjusts these reserves in light of changing facts and circumstances, such as the closing of a tax audit or the expiration of the statute of limitations. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will impact the provision for income taxes in the period in which such determination is made. The provision for income taxes includes the impact of reserve provisions and changes to reserves that are considered appropriate, as well as the related net interest. A reconciliation of unrecognized tax benefits follows (in thousands): Balance, December 31, 2013 $ Additions based upon tax positions related to the current year Balance, December 31, 2014 $ Additions recorded in purchase accounting Balance, December 31, 2015 $ Reductions due to lapses of applicable statute of limitations Balance, December 31, 2016 $ The Company’s unrecognized tax benefits reserve for uncertain tax positions primarily relates to certain tax exposure items acquired as a result of the Sun Merger, the most significant item is an IRC 382 realized built-in-gain resulting in utilization of the net operating loss carryforward. The liability related to the Sun Merger reserve was accounted for as part of the purchase price and was not charged to income tax expense. In the third quarter of 2016, the Company was able to release this FIN 48 reserve as the statute of limitations upon the return the position was initially recognized expired. All of the gross unrecognized tax benefits would affect the effective tax rate if recognized. Unrecognized tax benefits are adjusted in the period in which new information about a tax position becomes available or the final outcome differs from the amount recorded. Unrecognized tax benefits are not expected to change significantly over the next twelve months. The Company recognizes potential accrued interest related to unrecognized tax benefits in income tax expense. Penalties, if incurred, would also be recognized as a component of income tax expense. The amount of accrued interest related to unrecognized tax benefits as of December 31, 2016, 2015, and 2014 was less than $0.1 million, $0.4 million, and $0.4 million, respectively. Generally, the Company has open tax years for state purposes subject to tax audit on average of between three years to six years. The Company’s U.S. income tax returns from 2011 are open and could be subject to examination. Exchange Rights and Tax Receivable Agreement Following the Combination, the owners of FC-GEN will have the right to exchange their membership interests in FC-GEN for shares of Class A Common Stock of the Company or cash, at the Company’s option. As a result of such exchanges, the Company’s membership interest in FC-GEN will increase and its purchase price will be reflected in its share of the tax basis of FC-GEN’s tangible and intangible assets. Any resulting increases in tax basis are likely to increase tax depreciation and amortization deductions and, therefore, reduce the amount of income tax the Company would otherwise be required to pay in the future. Any such increase would also decrease gain (or increase loss) on future dispositions of the affected assets. There were exchanges of 600,000 Class A units during 2016 and no exchanges during 2015. The exchanges in 2016 resulted in a $2.9 million IRC Sec. 754 tax basis step-up in the tax deductible goodwill of FC-GEN. Concurrent with the Combination, the Company entered into a tax receivable agreement (TRA) with the owners of FC-GEN. The agreement provides for the payment by the Company to the owners of FC-GEN of 90% of the cash savings, if any, in U.S. federal, state and local income tax that the Company actually realizes as a result of (i) the increases in tax basis attributable to the owners of FC-GEN and (ii) tax benefits related to imputed interest deemed to be paid by the Company as a result of the TRA. Under the TRA, the benefits deemed realized by the Company as a result of the increase in tax basis attributable to the owners of FC-GEN generally will be computed by comparing the actual income tax liability of the Company to the amount of such taxes that the Company would have been required to pay had there been no such increase in tax basis. Estimating the amount of payments that may be made under the TRA is by its nature imprecise, insofar as the calculation of amounts payable depends on a variety of factors. The actual increase in tax basis and deductions, as well as the amount and timing of any payments under the TRA, will vary depending upon a number of factors, including: the timing of exchanges—for instance, the increase in any tax deductions will vary depending on the fair value of the depreciable or amortizable assets of FC-GEN and its subsidiaries at the time of each exchange, which fair value may fluctuate over time; the price of shares of Company Class A Common Stock at the time of the exchange—the increase in any tax deductions, and the tax basis increase in other assets of FC-GEN and its subsidiaries is directly proportional to the price of shares of Company Class A Common Stock at the time of the exchange; the amount and timing of the Company’s income—the Company is required to pay 90% of the deemed benefits as and when deemed realized. If FC-GEN does not have taxable income, the Company is generally not required (absent a change of control or circumstances requiring an early termination payment) to make payments under the TRA for that taxable year because no benefit will have been actually realized. However, any tax benefits that do not result in realized benefits in a given tax year likely will generate tax attributes that may be utilized to generate benefits in previous or future tax years. The utilization of such tax attributes will result in payments under the TRA; and future tax rates of jurisdictions in which the Company has tax liability. The TRA also provides that upon certain mergers, asset sales, other forms of business combinations or other changes of control, FC-GEN (or its successor’s) obligations under the TRA would be based on certain assumptions defined in the TRA. As a result of these assumptions, FC-GEN could be required to make payments under the TRA that are greater or less than the specified percentage of the actual benefits realized by the Company that are subject to the TRA. In addition, if FC-GEN elects to terminate the TRA early, it would be required to make an early termination payment, which upfront payment may be made significantly in advance of the anticipated future tax benefits. Payments generally are due under the TRA within a specified period of time following the filing of FC-GEN’s U.S. federal and state income tax return for the taxable year with respect to which the payment obligation arises. Payments under the TRA generally will be based on the tax reporting positions that FC-GEN will determine. Although FC-GEN does not expect the Internal Revenue Service (IRS) to challenge the Company’s tax reporting positions, FC-GEN will not be reimbursed for any overpayments previously made under the TRA, but any overpayments will reduce future payments. As a result, in certain circumstances, payments could be made under the TRA in excess of the benefits that FC-GEN actually realizes in respect of the tax attributes subject to the TRA. The term of the TRA generally will continue until all applicable tax benefits have been utilized or expired, unless the Company exercises its right to terminate the TRA and make an early termination payment. In certain circumstances (such as certain changes in control, the election of the Company to exercise its right to terminate the agreement and make an early termination payment or an IRS challenge to a tax basis increase) it is possible that cash payments under the TRA may exceed actual cash savings. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Disclosures | (16) Prior to the Combination on February 2, 2015, the Company was wholly owned by private investors sponsored by affiliates of Formation Capital, LLC (Formation). The Company has an investment of $1.0 million and received an approximate 6.8% interest in National Home Care Holdings, LLC, an unconsolidated joint venture affiliated with one of the Company’s sponsors. The Company maintained an approximately 5.4% interest in FC PAC Holdings, LLC (FC PAC), an unconsolidated joint venture, affiliated with one of the Company’s sponsors. The Company contracts with FC PAC to provide hospice and diagnostic services in the normal course of business. On March 31, 2015, the Company sold its investment in FC PAC for $26.4 million. The Company recognized a gain on sale of $8.4 million recorded as other income on the statement of operations. FC PAC ownership includes affiliates of Formation, some of whom are members of the Company’s board of directors. On May 1, 2016, the Company entered into preferred provider and affiliation agreements with FC PAC. Fees for these services amounted to $12.2 million, $12.0 million and $7.9 million in the years ended December 31, 2016, 2015 and 2014, respectively. On July 1, 2015, the Company acquired 22 rehabilitation outpatient clinics from entities associated with Formation for a purchase price of $1.1 million. The acquisition was financed entirely with a promissory note. The note bears interest equal to 5% per annum with principal due in full on July 1, 2020. The Company provides rehabilitation services to certain facilities owned and operated by affiliates of the Company’s sponsors. These services resulted in net revenue of $155.4 million, $161.4 million and $161.2 million in the years ended December 31, 2016, 2015, and 2014, respectively. The services resulted in net accounts receivable balances of $83.9 million and $57.1 million at December 31, 2016 and 2015, respectively. The Company is billed by an affiliate of the Company’s sponsors a monthly fee for the provision of administrative services. The fees billed were $0.0 million, $0.1 million and $2.5 million for the years ended December 31, 2016, 2015 and 2014, respectively. On February 2, 2015 in connection with the Combination, an affiliate of the Company’s sponsors received a transaction advisory fee of $3.0 million and the administrative services monthly fee was discontinued. Effective May 1, 2016, the Company completed the sale of its hospice and home health operations to FC Compassus LLC for $72 million in cash and a $12 million short-term note. Certain members of the Company’s board of directors indirectly beneficially hold ownership interests in FC Compassus LLC totaling less than 10% in the aggregate. See Note 4 – “ Significant Transactions and Events – Sale of Hospice and Home Health.” The combined note and accrued interest balance of $13.0 million remains outstanding at December 31, 2016. |
Defined Contribution Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Defined Contribution Plan | (17) The Company sponsors a defined contribution plan covering substantially all employees who meet certain eligibility requirements. The Company did not match employee contributions for the defined contribution plan in 2016 and 2015. |
Other Income
Other Income | 12 Months Ended |
Dec. 31, 2016 | |
Other Income and Expenses [Abstract] | |
Other Income | (18) In the year ended December 31, 2016, the Company completed multiple transactions, including the divestitures of numerous owned assets and the termination and refinancing of certain facilities subject to lease agreements. See Note 4 - “ Significant Transactions and Events .” These transactions resulted in net gains recorded as other income in the consolidated statements of operations. The following table summarizes those net gains (in thousands): Year ended December 31, 2016 Gain on sale of hospice and home health $ Gain on sale of investment in joint venture Gain on escrow receipt associated with terminated sale agreement Gain on sale of other owned assets, net Gain on leased facilities sold to new landlord and operating under new lease agreements Gain on divested facilities terminated from lease agreements $ |
Asset Impairment Charges
Asset Impairment Charges | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Asset Impairment Charges | ( 19) Long-Lived Assets with a Definite Useful Life In each quarter, the Company’s long-lived assets with a definite useful life were tested for impairment at the lowest levels for which there are identifiable cash flows. The Company estimated the future net undiscounted cash flows expected to be generated from the use of the long-lived assets and then compared the estimated undiscounted cash flows to the carrying amount of the long-lived assets. The cash flow period was based on the remaining useful lives of the primary asset in each long-lived asset group, principally a building in the inpatient segment and customer relationship assets in the rehabilitation therapy services segment. For 2016, 2015 and 2014, the Company recognized impairment charges in the inpatient segment totaling $35.4 m illion , $28.5 million and $31.4 million, respectively. Goodwill Adverse changes in the operating environment and related key assumptions used to determine the fair value of the Company’s reporting units and indefinite-lived intangible assets may result in future impairment charges for a portion or all of these assets. Specifically, if the rate of growth of government and commercial revenues earned by the Company’s reporting units were to be less than projected or if healthcare reforms were to negatively impact the Company’s business, an impairment charge of a portion or all of these assets may be required. An impairment charge could have a material adverse effect on the Company’s business, financial position and results of operations, but would not be expected to have an impact on the Company’s cash flows or liquidity. The Company performed its annual goodwill impairment test as of September 30, 2016, 2015 and 2014 and determined that no impairment was necessary. The Company determined that the fair value of the reporting unit exceeded the carrying value based upon the market capitalization including a control premium and a discounted cash flow analysis. Determining fair value requires the exercise of significant judgment, including judgment about appropriate discount rates, perpetual growth rates, the amount and timing of expected future cash flows, as well as relevant comparable company earnings multiples for the market-based approach. The cash flows employed in the discounted cash flow analyses are based on the Company’s internal business model for 2017 and, for years beyond 2017 the growth rates used are an estimate of the future growth in the industry in which the Company participates. The discount rates used in the discounted cash flow analyses are intended to reflect the risks inherent in the future cash flows of the reporting unit and are based on an estimated cost of capital, which was determined based on the Company’s estimated cost of capital relative to its capital structure. In addition, the market-based approach utilizes comparable company public trading values, research analyst estimates and, where available, values observed in private market transactions. The Company performed a quantitative test for impairment of goodwill to assess the impact of changes in the regulatory and reimbursement environment. The quantitative analysis is a two-step process as follows: · Step one, the Company compares the carrying amount of each of the reporting units to the fair value of each of the reporting units. If the carrying amount of each of its reporting units exceeds its fair value, the Company must perform the second step of the process. If not, no further testing is needed. · Step two, the Company allocates the fair value of each of the reporting units to all assets and liabilities as if each of the reporting units had been acquired in a business combination at the date of the impairment test. The Company would then compare the implied fair value of each of the reporting units’ goodwill to its carrying amount. If the carrying amount of the goodwill exceeds its implied fair value, it recognizes an impairment loss in an amount equal to that excess. Step one of the analysis indicated that the reporting unit fair value exceeded the book value and accordingly the Company did not perform the second step in the analysis. As a result, the Company concluded no impairment of goodwill was necessary. |
Assets Held for Sale and Discon
Assets Held for Sale and Discontinued Operations | 12 Months Ended |
Dec. 31, 2016 | |
Assets Held for Sale and Discontinued Operations | |
Assets Held for Sale and Discontinued Operations | (20) In the normal course of business, the Company continually evaluates the performance of its operating units, with an emphasis on selling or closing underperforming or non-strategic assets. These assets are evaluated to determine whether they qualify as assets held for sale or discontinued operations. The assets and liabilities of a disposal group classified as held for sale shall be presented separately in the asset and liability sections, respectively, of the statement of financial position in the period in which they are identified only. Assets held for sale that qualify as discontinued operations are removed from the results of continuing operations. The results of operations in the current and prior year periods, along with any cost to exit such businesses in the year of discontinuation, are classified as discontinued operations in the consolidated statements of operations. In the fourth quarter of 2016, the Company identified a disposal group of 16 owned skilled nursing facilities that qualified as assets held for sale. The Company entered into a purchase and sale agreement to sell 18 facilities (16 owned and 2 leased) in the states of Kansas, Missouri, Nebraska and Iowa. The transaction will mark an exit from the inpatient business in these states. Closing is subject to licensure and other regulatory approvals. Closing is expected to occur in the first or second quarter of 2017. The disposal group does not meet the criteria as a discontinued operation. No gain or loss was recognized in the statements of operations for the disposal group. The following table sets forth the major classes of assets and liabilities included as part of the disposal group (in thousands): December 31, 2016 Current assets: Prepaid expenses $ Long-term assets: Property and equipment, net of accumulated depreciation of $10,792 Goodwill Total assets $ Current liabilities: Current installments of long-term debt $ Long-term liabilities: Long-term debt Total liabilities $ The following table sets forth net revenues and the components of loss from discontinued operations (in thousands): Year ended December 31, 2016 2015 2014 Net revenues $ $ $ Net operating income (loss) of discontinued businesses $ $ $ Loss on discontinuation of business — — Income tax (expense) benefit Income (loss) from discontinued operations, net of taxes $ $ $ Subsequent to October 1, 2014, there have been no operational closures which have been categorized as a discontinued operation. In 2014 prior to October 1, 2014, the Company closed or transferred operations of four facilities with licensed beds of 440 located in the states of California and Massachusetts. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (21) Loss Reserves For Certain Self-Insured Programs General and Professional Liability and Workers’ Compensation The Company self-insures for certain insurable risks, including general and professional liabilities and workers’ compensation liabilities through the use of self-insurance or retrospective and self-funded insurance policies and other hybrid policies, which vary among states in which the Company operates, including wholly owned captive insurance subsidiaries, to provide for potential liabilities for general and professional liability claims and workers’ compensation claims. Policies are typically written for a duration of twelve months and are measured on a “claims made” basis. Regarding workers’ compensation, the Company self-insures to its deductible and purchases statutorily required insurance coverage in excess of its deductible. There is a risk that amounts funded by the Company’s self-insurance programs may not be sufficient to respond to all claims asserted under those programs. Insurance reserves represent estimates of future claims payments and legal costs. This liability includes an estimate of the development of reported losses and losses incurred but not reported. Provisions for changes in insurance reserves are made in the period of the related coverage. The Company also considers amounts that may be recovered from excess insurance carriers in estimating the ultimate net liability for such risks. The Company’s management employs its judgment and periodic independent actuarial analysis in determining the adequacy of certain self-insured workers’ compensation and general and professional liability obligations recorded as liabilities in the Company’s financial statements. The Company evaluates the adequacy of its self-insurance reserves on a semi-annual basis or more often when it is aware of changes to its incurred loss patterns that could impact the accuracy of those reserves. The methods of making such estimates and establishing the resulting reserves are reviewed periodically and are based on historical paid claims information and nationwide nursing home trends. The foundation for most of these methods is the Company’s actual historical reported and/or paid loss data. Any adjustments resulting therefrom are reflected in current earnings. Claims are paid over varying periods, and future payments may be different than the estimated reserves. The Company utilizes third-party administrators (TPAs) to process claims and to provide it with the data utilized in its assessments of reserve adequacy. The TPAs are under the oversight of the Company’s in-house risk management and legal functions. These functions ensure that the claims are properly administered so that the historical data is reliable for estimation purposes. Case reserves, which are approved by the Company’s legal and risk management departments, are determined based on an estimate of the ultimate settlement and/or ultimate loss exposure of individual claims. The reserves for loss for workers’ compensation risks are discounted based on actuarial estimates of claim payment patterns using a discount rate of approximately 1% for each policy period presented. The discount rate for the current policy year is 0.96%. The discount rates are based upon the risk-free rate for the appropriate duration for the respective policy year. The removal of discounting would have resulted in an increased reserve for workers’ compensation risks of $8.9 million and $8.6 million as of December 31, 2016 and 2015, respectively. The reserves for general and professional liability are recorded on an undiscounted basis. The provision for general and professional liability risks totaled $137.5 million, $151.1 million and $130.8 million for the year ended December 31, 2016, 2015 and 2014, respectively. The reserves for general and professional liability were $392.1 million and $371.6 million as of December 31, 2016 and 2015, respectively. The provision for loss for workers’ compensation risks totaled $60.7 million, $60.7 million and $62.4 million for the year ended December 31, 2016, 2015 and 2014, respectively. The reserves for workers’ compensation risks were $226.0 million and $223.7 million as of December 31, 2016 and 2015, respectively. Health Insurance The Company offers employees an option to participate in self-insured health plans. Health insurance claims are paid as they are submitted to the plans’ administrators. The Company maintains an accrual for claims that have been incurred but not yet reported to the plans’ administrators and therefore have not yet been paid. This accrual for incurred but not yet reported claims was $19.6 million and $21.8 million as of as of December 31, 2016 and 2015, respectively. The liability for the self-insured health plan is recorded in accrued compensation in the consolidated balance sheets. Although management believes that the amounts provided in the Company’s consolidated financial statements are adequate and reasonable, there can be no assurances that the ultimate liability for such self-insured risks will not exceed management’s estimates. Legal Proceedings The Company and certain of its subsidiaries are involved in various litigation and regulatory investigations arising in the ordinary course of business. While there can be no assurance, based on the Company’s evaluation of information currently available, with the exception of the specific matters noted below, management does not believe the results of such litigation and regulatory investigations would have a material adverse effect on the results of operations, financial position or cash flows of the Company. However, the Company’s assessment of materiality may be affected by limited information (particularly in the early stages of government investigations). Accordingly, the Company’s assessment of materiality may change in the future based upon availability of discovery and further developments in the proceedings at issue. The results of legal proceedings are inherently uncertain, and material adverse outcomes are possible. From time to time the Company may enter into confidential discussions regarding the potential settlement of pending investigations or litigation. There are a variety of factors that influence the Company’s decisions to settle and the amount it may choose to pay, including the strength of the Company’s case, developments in the investigation or litigation, the behavior of other interested parties, the demand on management time and the possible distraction of the Company’s employees associated with the case and/or the possibility that the Company may be subject to an injunction or other equitable remedy. The settlement of any pending investigation, litigation or other proceedings could require the Company to make substantial settlement payments and result in its incurring substantial costs. Agreement in Principle on Financial Terms of a Settlement In July 2016, the Company and the U.S. Department of Justice (the DOJ) reached an agreement in principle on the financial terms of a settlement regarding four matters arising out of the activities of Skilled or Sun Healthcare prior to their operations becoming part of the Company’s operations (collectively, the Successor Matters). The four matters are: the Creekside Hospice Litigation, the Therapy Matters Investigation, the Staffing Matters Investigation and the SunDance Part B Therapy Matter (each as defined below). The Company has agreed to the settlement in principle in order to resolve the allegations underlying the Successor Matters and to avoid the uncertainty and expense of litigation. Based on the agreement in principle and in anticipation of the execution of final agreements and payment of a settlement amount of $52.7 million (the Settlement Amount), the Company recorded an additional loss contingency expense in the amount of $13.6 million in the second quarter of 2016, to increase its previously estimated and recorded liability. The settlement amount is recorded in accrued expenses in the consolidated balance sheets. The Company expects to remit the Settlement Amount to the government over a period of five (5) years, once the agreement has been fully documented. The agreement in principle is subject to negotiation, completion and execution of appropriate implementing agreements, including a settlement agreement or agreements, which are expected to be finalized in the first or second quarter of 2017, and the final approval of the respective parties. There can be no assurance that the Company will enter into a final settlement agreement with the DOJ. At this time, management believes that the ultimate outcome of the Successor Matters will not have a material adverse effect on the Company’s consolidated financial condition, results of operations and cash flows. Creekside Hospice Litigation On August 2, 2013, the United States Attorney for the District of Nevada and the Civil Division of the DOJ informed Skilled that its Civil Division was investigating Skilled, as well as its then subsidiary, Creekside Hospice II, LLC, for possible violations of federal and state healthcare fraud and abuse laws and regulations (the Creekside Hospice Litigation). Those laws could have included the federal False Claims Act (FCA) and the Nevada False Claims Act (NFCA). The FCA provides for civil and administrative fines and penalties, plus treble damages. The NFCA provides for similar fines and penalties, including treble damages. Violations of those federal or state laws could also subject the Company and/or its subsidiaries to exclusion from participation in the Medicare and Medicaid programs. On or about August 6, 2014, in relation to the investigation the DOJ filed a notice of intervention in two pending qui tam proceedings filed by private party relators under the FCA and the NFCA and advised that it intended to take over the actions. The DOJ filed its complaint in intervention on November 25, 2014, against Creekside, Skilled Healthcare Group, Inc., and Skilled Healthcare, LLC, asserting, among other things, that certain claims for hospice services provided by Creekside in the time period 2010 to 2013 (prior to the Combination) did not meet Medicare requirements for reimbursement and were in violation of the civil FCA. Therapy Matters Investigation In February 2015, representatives of the DOJ informed the Company that they were investigating the provision of therapy services at certain Skilled facilities from 2005 through 2013 (prior to the Combination) and may pursue legal action against the Company and certain of its subsidiaries including Hallmark Rehabilitation GP, LLC for alleged violations of the federal and state healthcare fraud and abuse laws and regulations related to such services (the Therapy Matters Investigation). Those laws could have included the FCA and similar state laws. Staffing Matters Investigation In February 2015, representatives of the DOJ informed the Company that it intended to pursue legal action against the Company and certain of its subsidiaries related to staffing and certain quality of care allegations at certain Skilled facilities that occurred prior to the Combination, related to the issues adjudicated against the Company and those subsidiaries in a previously disclosed class action lawsuit that Skilled settled in 2010 (the Staffing Matters Investigation). Those laws could have included the FCA and similar state laws. SunDance Part B Therapy Matter A subsidiary of Sun Healthcare, SunDance Rehabilitation Corp. (SunDance), operates an outpatient agency licensed to provide Medicare Part B therapy services at assisted/senior living facilities in Georgia and is a party to a qui tam proceeding that was filed by a private party relator under the FCA. No SunDance agencies outside of Georgia are part of the qui tam proceeding. The Civil Division of the United States Attorney's Office for the District of Georgia has filed a notice of intervention in this matter in March 2016 and asserts that certain SunDance claims for therapy services did not meet Medicare requirements for reimbursement. Conditional Asset Retirement Obligations Certain of the Company’s leased and owned real estate assets contain asbestos. The asbestos is believed to be appropriately contained in accordance with environmental regulations. If these properties were demolished or subject to renovation activities that disturb the asbestos, certain environmental regulations are in place, which specify the manner in which the asbestos must be handled and disposed. At December 31, 2016 and 2015, the Company has a liability for the asset retirement obligation associated primarily with the cost of asbestos removal aggregating approximately $9.9 million and $9.5 million, respectively, which is included in other long-term liabilities. The liability for each facility will be accreted to its settlement value, which is estimated to approximate $22.0 million through the estimated settlement dates extending from 2017 through 2042. Due to the time over which these obligations could be settled and the judgment used to determine the liability, the ultimate obligation may differ from the estimate. Upon settlement, any difference between actual cost and the estimate is recognized as a gain or loss in that period. Annual accretion of the liability and depreciation expense is recorded each year for the impacted assets until the obligation year is reached, either by sale of the property, demolition or some other future event such as a government action. Employment Agreements The Company has employment agreements and arrangements with its executive officers and certain members of management. The agreements generally continue until terminated by the executive or management, and provide for severance payments under certain circumstances. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value of Financial Instruments | |
Fair Value Measurements | (22) The Company’s financial instruments consist primarily of cash and cash equivalents, restricted cash and investments in marketable securities, accounts receivable, accounts payable and current and long-term debt. The Company’s financial instruments, other than its accounts receivable and accounts payable, are spread across a number of large financial institutions whose credit ratings the Company monitors and believes do not currently carry a material risk of non-performance. Certain of the Company’s financial instruments contain an off-balance-sheet risk. Recurring Fair Value Measures Fair value is defined as an exit price (i.e., the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date). The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels as shown below. An instrument’s classification within the fair value hierarchy is determined based on the lowest level input that is significant to the fair value measurement. Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 — Inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the asset or liability. Level 3 — Inputs that are unobservable for the asset or liability based on the Company’s own assumptions (about the assumptions market participants would use in pricing the asset or liability). The tables below present the Company’s assets measured at fair value on a recurring basis as of December 31, 2016 and 2015, aggregated by the level in the fair value hierarchy within which those measurements fall (in thousands): Fair Value Measurements at Reporting Date Using Quoted Prices in Significant Active Markets for Significant Other Unobservable December 31, Identical Assets Observable Inputs Inputs Assets: 2016 (Level 1) (Level 2) (Level 3) Cash and cash equivalents $ $ $ — $ — Restricted cash and equivalents — — Restricted investments in marketable securities: Mortgage/government backed securities — — Corporate bonds — — Government bonds — — Total $ $ $ — $ — Fair Value Measurements at Reporting Date Using Quoted Prices in Significant Active Markets for Significant Other Unobservable December 31, Identical Assets Observable Inputs Inputs Assets: 2015 (Level 1) (Level 2) (Level 3) Cash and cash equivalents $ $ $ — $ — Restricted cash and equivalents — — Restricted investments in marketable securities: Mortgage/government backed securities — — Corporate bonds — — Government bonds — — Total $ $ $ — $ — The Company places its cash and cash equivalents and restricted investments in marketable securities in quality financial instruments and limits the amount invested in any one institution or in any one type of instrument. The Company has not experienced any significant losses on such investments. Debt Instruments The table below shows the carrying amounts and estimated fair values, net of debt issuance costs and other non-cash debt discounts and premiums, of the Company’s primary long-term debt instruments: December 31, 2016 December 31, 2015 Carrying Value Fair Value Carrying Value Fair Value Revolving credit facilities $ $ $ $ Term loan facility — — New term loan agreement — — Real estate bridge loans HUD insured loans Notes payable — — Mortgages and other secured debt (recourse) Mortgages and other secured debt (non-recourse) $ $ $ $ The fair value of debt is based upon market prices or is computed using discounted cash flow analysis, based on the Company’s estimated borrowing rate at the end of each fiscal period presented. The Company believes that the inputs to the pricing models qualify as Level 2 measurements. Non-Recurring Fair Value Measures The Company recently applied the fair value measurement principles to certain of its non-recurring nonfinancial assets in connection with an impairment test . The following table presents the Company’s hierarchy for nonfinancial assets measured at fair value on a non-recurring basis (in thousands): Impairment Charges - Carrying Value Year ended December 31, 2016 December 31, 2016 Assets: Property and equipment, net $ $ Goodwill — Intangible assets Impairment Charges - Carrying Value Year ended December 31, 2015 December 31, 2015 Assets: Property and equipment, net $ $ Goodwill — Intangible assets The fair value allocation related to the Company’s acquisitions and the fair value of tangible and intangible assets related to the Company’s impairment analysis are determined using a discounted cash flow approach, which is a significant unobservable input (Level 3). The Company estimates the fair value using the income approach (which is a discounted cash flow technique). These valuation methods required management to make various assumptions, including, but not limited to, future profitability, cash flows and discount rates. The Company’s estimates are based upon historical trends, management’s knowledge and experience and overall economic factors, including projections of future earnings potential. Developing discounted future cash flows in applying the income approach requires the Company to evaluate its intermediate to longer-term strategies, including, but not limited to, estimates of revenue growth, operating margins, capital requirements, inflation and working capital management. The development of appropriate rates to discount the estimated future cash flows requires the selection of risk premiums, which can materially impact the present value of future cash flows. The Company estimated the fair value of acquired tangible and intangible assets using discounted cash flow techniques that included an estimate of future cash flows, consistent with overall cash flow projections used to determine the purchase price paid to acquire the business, discounted at a rate of return that reflects the relative risk of the cash flows. The Company believes the estimates and assumptions used in the valuation methods are reasonable. |
Quarterly Financial Information
Quarterly Financial Information | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | (23) The following table summarizes unaudited quarterly financial data for the years ended December 31, 2016 and 2015 (dollars in thousands, except per share data): Quarter ended March 31, 2016 June 30, 2016 September 30, 2016 December 31, 2016 Net revenues $ $ $ $ Net loss attributable to Genesis Healthcare, Inc.: (Loss) income from continuing operations attributable to Genesis Healthcare, Inc. $ $ $ $ (1) (Loss) income from discontinued operations, net of taxes Net (loss) income attributable to Genesis Healthcare, Inc. $ $ $ $ Net (loss) income per common share attributable to Genesis Healthcare, Inc.: Basic Diluted Weighted average shares used in computing (loss) income per common share: Basic Diluted Quarter ended March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 Net revenues $ (2) $ $ $ Net loss attributable to Genesis Healthcare, Inc.: Loss from continuing operations attributable to Genesis Healthcare, Inc. $ (3) $ $ $ (4) Income (loss) from discontinued operations, net of taxes Net loss attributable to Genesis Healthcare, Inc. $ $ $ $ Loss per common share: Basic and diluted: Net loss attributable to Genesis Healthcare, Inc. Shares used in computing loss per common share 1) The quarter ended December 31, 2016 includes gains of approximately $160 million associated with the sales of owned assets, divestitures of leased facilities and other lease transactions offset by approximately $35 million associated with long-lived asset impairments. 2) The quarter ended March 31, 2015 includes two months of revenue associated with the Combination. 3) The quarter ended March 31, 2015 includes transaction costs associated with the Combination. The quarter ended December 31, 2015 includes a deferred tax valuation allowance of $221.9 million recorded as income tax expense and $28.5 million of long-lived asset impairments. |
Schedule II - Valuation Account
Schedule II - Valuation Accounts | 12 Months Ended |
Dec. 31, 2016 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation Accounts | GENESIS HEALTHCARE, INC. AND SUBSIDIARIES SCHEDULE II—VALUATION AND QUALIFYING ACCOUNT FOR THE YEARS ENDED DECEMBER 31, 2016, 2015 AND 2014 Balance at beginning of the Charged to cost Deductions or Balance at end of period and expenses (1) Other payments the period Allowance for loss on accounts receivable Year ended December 31, 2014 $ $ $ — $ $ Year ended December 31, 2015 — Year ended December 31, 2016 $ $ $ $ $ (1) Amounts per year differ from the provision for losses on accounts receivable due to discontinued operations as well as managed care coinsurance reserves and other adjustments, which are included in the provision for loss on accounts receivable but not in the allowance for loss on accounts receivable. |
Summary of Significant Accoun32
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Estimates and Assumptions | Estimates and Assumptions The consolidated financial statements have been prepared in conformity with U.S. GAAP, which requires management to consolidate company financial information and make informed estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The most significant estimates in the Company’s consolidated financial statements relate to allowance for doubtful accounts, self-insured liability risks, income taxes, impairment of long-lived assets and goodwill, and other contingencies. Actual results could differ from those estimates. |
Net Revenues and Accounts Receivable | Net Revenues and Accounts Receivable Revenues and accounts receivable are recorded on an accrual basis as services are performed at their estimated net realizable value. The Company derives a majority of its revenue from funds under federal Medicare and state Medicaid assistance programs, the continuation of which is dependent upon governmental policies and is subject to audit risk and potential recoupment. The Company also receives payments through reimbursement from Medicaid and Medicare programs and directly from individual residents (private pay), third-party insurers and long-term care facilities. The Company assesses collectibility on all accounts prior to providing services. The Company records revenue for inpatient services and the related receivables in the accounting records at the Company’s established billing rates in the period the related services are rendered. The provision for contractual adjustments, which represents the difference between the established billing rates and predetermined reimbursement rates, is deducted from gross revenue to determine net revenue. Retroactive adjustments that are likely to result from future examinations by third party payors are accrued on an estimated basis in the period the related services are rendered and adjusted as necessary in future periods based upon new information or final settlements. The Company records revenue for rehabilitation therapy services and other ancillary services and the related receivables at the time services or products are provided or delivered to the customer. Upon delivery of products or services, the Company has no additional performance obligation to the customer. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of cash and short-term investments with original maturities of three months or less when purchased and therefore, approximate fair value. The Company’s available cash is held in accounts at commercial banking institutions. The Company currently has bank deposits with commercial banking institutions that exceed Federal Deposit Insurance Corporation insurance limits. |
Restricted Cash and Investments in Marketable Securities | Restricted Cash and Investments in Marketable Securities Restricted cash includes cash and money market funds principally held by the Company’s wholly owned captive insurance subsidiaries, which are substantially restricted to securing outstanding claims losses. The restricted cash and investments in marketable securities balances at December 31, 2016 and 2015 were $156.0 million and $198.1 million, respectively. Restricted investments in marketable securities, comprised principally of fixed interest rate securities, are considered to be available-for-sale and accordingly are reported at fair value with unrealized gains and losses, net of related tax effects, included within accumulated other comprehensive loss, a separate component of stockholders’ deficit. Fair values for fixed interest rate securities are based on quoted market prices. A decline in the market value of any security below cost that is deemed other-than-temporary is charged to income, resulting in the establishment of a new cost basis for the security. Realized gains and losses for securities classified as available-for-sale are derived using the specific identification method for determining the cost of securities sold. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts The Company evaluates the adequacy of its allowance for doubtful accounts by estimating allowance requirement percentages for each accounts receivable aging category for each type of payor. The Company has developed estimated allowance requirement percentages by utilizing historical collection trends and its understanding of the nature and collectibility of receivables in the various aging categories and the various lines of the Company’s business. The allowance percentages are developed by payor type as the accounts receivable from each payor type have unique characteristics. The allowance for doubtful accounts also considers accounts specifically identified as uncollectible. Accounts receivable that Company management specifically estimates to be uncollectible, based upon the age of the receivables, the results of collection efforts, or other circumstances, are reserved in the allowance for doubtful accounts until written-off. |
Property and Equipment | Property and Equipment Property and equipment are carried at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the depreciable assets, which generally range from 20-35 years for buildings, building improvements and land improvements, and 3-15 years for equipment, furniture and fixtures and information systems. Depreciation expense on leasehold improvements and assets held under capital leases is calculated using the straight-line method over the lesser of the lease term or the estimated useful life of the asset. Expenditures for maintenance and repairs necessary to maintain property and equipment in efficient operating condition are expensed as incurred. Costs of additions and betterments are capitalized. Total depreciation expense from continuing operations for the years ended December 31, 2016, 2015 and 2014 was $234.7 million, $218.8 million, and $184.3 million, respectively. |
Identifiable Intangible Assets and Goodwill | Identifiable Intangible Assets and Goodwill Definite-lived intangible assets consist of management contracts, customer relationships and favorable leases. These assets are amortized in accordance with the authoritative guidance for intangible assets using the straight-line method over their estimated useful lives. Indefinite-lived intangible assets primarily consist of trade names. Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations . See Note 9 – “ Goodwill and Identifiable Intangible Assets .” |
Impairment of Long-lived Assets | Impairment of Long-Lived Assets The Company’s long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by comparison of the carrying amount of an asset to the future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future undiscounted cash flows, an impairment charge is recognized to the extent the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell. The Company performs an assessment of qualitative factors prior to the use of the two step quantitative method to determine if goodwill has been impaired. If such qualitative assessment does not indicate that it is more likely than not the fair value of the reporting is less than its carrying value, no further analysis is required. If required, the Company performs a quantitative goodwill impairment test which involves a two-step process. The first step is a comparison of each reporting unit’s fair value to its carrying value. If the carrying value of the reporting unit is greater than its fair value, there is an indication that impairment may exist and the second step must be performed to measure the amount of impairment loss, if any. The Company performs its annual impairment assessment for its reporting units as of September 30 of each year or more frequently if adverse events or changes in circumstances indicate that the asset may be impaired. See Note 19 – “ Asset Impairment Charges .” |
Self-Insurance Risks | Self-Insurance Risks The Company provides for self-insurance risks for both general and professional liability and workers’ compensation claims based on estimates of the ultimate costs for both reported claims and claims incurred but not reported. Estimated losses from asserted and incurred but not reported claims are accrued based on the Company’s estimates of the ultimate costs of the claims, which includes costs associated with litigating or settling claims, and the relationship of past reported incidents to eventual claims payments. All relevant information, including the Company’s own historical experience, the nature and extent of existing asserted claims and reported incidents, and independent actuarial analyses of this information is used in estimating the expected amount of claims. The reserves for loss for workers’ compensation risks are discounted based on actuarial estimates of claim payment patterns whereas the reserves for general and professional liability are recorded on an undiscounted basis. The Company also considers amounts that may be recovered from excess insurance carriers in estimating the ultimate net liability for such risks. See Note 21 – “ Commitments and Contingencies – Loss Reserves For Certain Self-Insured Programs – General and Professional Liability and Workers’ Compensation .” |
Income Taxes | Income Taxes The Company’s effective tax rate is based on pretax income, statutory tax rates and tax planning opportunities available in the various jurisdictions in which it operates. The Company accounts for income taxes in accordance with applicable guidance on accounting for income taxes, which requires that deferred tax assets and liabilities be recognized using enacted tax rates for the effect of temporary differences between book and tax bases on recorded assets and liabilities. Accounting guidance also requires that deferred tax assets be reduced by a valuation allowance, when it is more likely than not that a tax benefit will not be realized. The recognition and measurement of a tax position is based on management’s best judgment given the facts, circumstances and information available at the reporting date. The Company evaluates tax positions to determine whether the benefits of tax positions are more likely than not of being sustained upon audit based on the technical merits of the tax position. For tax positions that are more likely than not of being sustained upon audit, the Company recognizes the largest amount of the benefit that is greater than 50% likely of being realized upon ultimate settlement in the financial statements. For tax positions that are not more likely than not of being sustained upon audit, the Company does not recognize any portion of the benefit in the financial statements. If the more likely than not threshold is not met in the period for which a tax position is taken, the Company may subsequently recognize the benefit of that tax position if the tax matter is effectively settled, the statute of limitations expires, or if the more likely than not threshold is met in a subsequent period. The Company evaluates, on a quarterly basis, its ability to realize deferred tax assets by assessing its valuation allowance and by adjusting the amount of such allowance, if necessary. The factors used to assess the likelihood of realization are its forecast of pre-tax earnings, its forecast of future taxable income and available tax planning strategies that could be implemented to realize the net deferred tax assets. To the extent the Company prevails in matters for which reserves have been established, or are required to pay amounts in excess of its reserves, its effective tax rate in a given financial statement period could be materially affected. An unfavorable tax settlement would require use of cash and result in an increase in the effective tax rate in the year of resolution. A favorable tax settlement would be recognized as a reduction in the Company’s effective tax rate in the year of resolution. The Company records accrued interest and penalties associated with uncertain tax positions as income tax expense in the consolidated statement of operations. |
Leases | Leases Leasing transactions are a material part of the Company’s business. The following discussion summarizes various aspects of the Company’s accounting for leasing transactions and the related balances. Capital Leases Lease arrangements are capitalized when such leases convey substantially all the risks and benefits incidental to ownership. Capital leases are amortized over either the lease term or the life of the related assets, depending upon available purchase options and lease renewal features. Amortization related to capital lease assets is included in the consolidated statements of operations within depreciation and amortization expense. See Note 11 – “ Lease and Lease Commitments .” Operating Leases For operating leases, minimum lease payments, including minimum scheduled rent increases, are recognized as lease expense on a straight-line basis over the applicable lease terms and any periods during which the Company has use of the property but is not charged rent by a landlord. Lease terms, in most cases, provide for rent escalations and renewal options. When the Company purchases businesses that have operating lease agreements, it recognizes the fair value of the lease arrangements as either favorable or unfavorable and records these amounts as other identifiable intangible assets or other long-term liabilities, respectively. Favorable and unfavorable leases are amortized to lease expense on a straight-line basis over the remaining term of the leases. See Note 11 – “ Lease and Lease Commitments .” Sale/Leaseback Financing Obligation Prior to recognition as a sale, or profit/loss thereon, sale/leaseback transactions are evaluated to determine if their terms transfer all of the risks and rewards of ownership as demonstrated by the absence of any other continuing involvement by the seller-lessee. A sale/leaseback transaction that does not qualify for sale/leaseback accounting because of any form of continuing involvement by the seller-lessee is accounted for as a financing transaction. Under the financing method: (1) the assets and accumulated depreciation remain on the consolidated balance sheet and continue to be depreciated over the remaining useful lives; (2) no gain is recognized; and (3) proceeds received by the Company from these transactions are recorded as a financing obligation. See Note 12 – “ Financing Obligations .” |
Earnings (Loss) Per Common Share | Earnings (Loss) Per Common Share Earnings (loss) per common share are based upon the weighted average number of common shares outstanding during the respective periods. The Company follows the provisions of the authoritative guidance for determining whether instruments granted in share-based payment transactions are participating securities for purposes of calculating earnings per common share. See Note 5 – “ Loss Per Share .” |
Stock-Based Compensation | Stock-Based Compensation The Company recognizes compensation expense related to stock-based compensation awards in accordance with the related authoritative guidance. See Note 14 – “ Stock-Based Compensation .” |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (the FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which changes the requirements for recognizing revenue when entities enter into contracts with customers. Under ASU 2014-09, an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. It also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In December 2016, the FASB issued ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers (ASU 2016-20), which serves to narrow aspects of the guidance issued in ASU 2014-09. The adoption of ASU 2014-09 is effective for annual and interim periods beginning after December 15, 2017. There are two allowed adoption methods, (1) the full retrospective method, or (2) the modified retrospective method. The full retrospective method requires recognition of the cumulative effect of applying the new standard at the earliest period presented. The modified retrospective method requires recognition of the cumulative effect of applying the new standard at the date of initial application. The Company will adopt ASU 2014-09 effective January 1, 2018 using the modified retrospective method. The Company’s evaluation of the impact of ASU 2014-09 has been ongoing since its original issuance and will continue into 2017 before it is in a position to conclude on the total effect it and ASU 2016-20 will have on its consolidated financial condition and results of operations. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016-01), which is intended to improve the recognition and measurement of financial instruments. The new guidance is effective for annual and interim periods beginning after December 15, 2017, with early adoption permitted under certain circumstances. The Company is still evaluating the effect, if any, ASU 2016-01 will have on its consolidated financial condition and results of operations. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (ASU 2016-02), which amended authoritative guidance on accounting for leases. The new provisions require that a lessee of operating leases recognize 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. The guidance is effective for annual and interim periods beginning after December 15, 2018, and will require application of the new guidance at the beginning of the earliest comparable period presented. The Company will adopt ASU 2016-02 effective January 1, 2019. ASU 2016-02 must be adopted using a modified retrospective transition. The adoption of ASU 2016-02 is expected to have a material impact on the Company’s financial position. The Company is still evaluating the impact on its results of operations. In March 2016, the FASB issued ASU No. 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (ASU 2016-09), which is intended to improve the accounting for employee share-based payments and affects all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment award transactions are simplified, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. The new guidance is effective for annual and interim periods beginning after December 15, 2016, with early adoption permitted. The Company is still evaluating the effect, if any, ASU 2016-09 will have on its consolidated financial condition and results of operations. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15), which addresses how certain cash receipts and cash payments should be presented and classified in the statement of cash flows. The new guidance is effective for annual and interim periods beginning after December 15, 2017, with early adoption permitted. The Company is still evaluating the effect, if any, that ASU 2016-15 will have on its consolidated statements of cash flows. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (230): Restricted Cash (ASU 2016-18), which requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The adoption of ASU 2016-18 is effective for annual and interim periods beginning after December 15, 2017, with early adoption permitted, including adoption in an interim period. The Company is still evaluating the effect, if any, ASU 2016-18 will have on the Company’s consolidated statement of cash flows. In January 2017, the FASB issued ASU No. 2017-01, Business Combination (805): Clarifying the Definition of a Business (ASU 2017-01), which provides guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The adoption of ASU 2017-01 is effective for annual and interim periods beginning after December 15, 2017, with early adoption permitted in certain circumstances. The Company is still evaluating the effect, if any, ASU 2017-01 will have on the Company’s consolidated financial condition and results of operations. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (350): Simplifying the Test for Goodwill Impairment (ASU 2017-04), which serves to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. ASU 2017-04 also eliminates the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The adoption of ASU 2017-04 is effective for annual and interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is still evaluating the effect, if any, ASU 2017-04 will have on the Company’s consolidated financial condition and results of operations. |
Certain Significant Risks and33
Certain Significant Risks and Uncertainties (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Certain Significant Risks and Uncertainties | |
Schedule of Revenue by Source | Year ended December 31, 2016 2015 2014 Medicare % % % Medicaid % % % Insurance % % % Private and other % % % Total % % % |
Significant Transactions and 34
Significant Transactions and Events (Tables) - FC-GEN Operations Investment, LLC | 12 Months Ended |
Dec. 31, 2016 | |
Summary of Consideration Price and Related Allocation (in thousands) | Accounts receivable $ Deferred income taxes and other current assets Property, plant and equipment Weighted Average Life Identifiable intangible assets: (Years) Management contracts Customer relationships Favorable lease contracts Trade names Indefinite Total identifiable intangible assets Deferred income taxes and other assets Accounts payable and other current liabilities Long-term debt, including amounts due within one year Unfavorable lease contracts Deferred income taxes and other long-term liabilities Total identifiable net assets Goodwill Net assets $ |
Unaudited Pro Forma Net Effect of the Combination (in thousands, except per share amounts) | Year ended December 31, 2015 2014 Revenues $ $ Loss attributable to Genesis Healthcare, Inc. Loss per common share: Basic $ $ Diluted $ $ |
Loss Per Share (Tables)
Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Loss Per Share | |
Schedule of reconciliation of the numerator and denominator used in the calculation of basic net loss per common share | Year ended December 31, 2016 2015 2014 Numerator: Loss from continuing operations $ $ $ Less: Net (loss) income attributable to noncontrolling interests Loss from continuing operations attributable to Genesis Healthcare, Inc. $ $ $ Income (loss) from discontinued operations, net of taxes Net loss attributable to Genesis Healthcare, Inc. $ $ $ Denominator: Weighted-average shares outstanding for basic net loss per share Basic net loss per common share: Loss from continuing operations attributable to Genesis Healthcare, Inc. $ $ $ (Loss) income from discontinued operations, net of taxes Net loss attributable to Genesis Healthcare, Inc. $ $ $ |
Schedule of reconciliation of the numerator and denominator used in the calculation of diluted net loss per common share | Year ended December 31, 2016 2015 2014 Numerator: Loss from continuing operations $ $ $ Less: Net (loss) income attributable to noncontrolling interests Loss from continuing operations attributable to Genesis Healthcare, Inc. $ $ $ Income (loss) from discontinued operations, net of taxes Net loss attributable to Genesis Healthcare, Inc. $ $ $ Plus: Exchange of restricted stock units of noncontrolling interests — — Net loss available to common stockholders after assumed conversions $ $ $ Denominator: Weighted-average shares outstanding for diluted net loss per share Effect of dilutive shares: Exchange of restricted stock units of noncontrolling interests — — Employee and director unvested restricted stock units — — Dilutive potential common shares — — Adjusted weighted-average common shares outstanding, diluted Diluted net loss per common share: Loss from continuing operations attributable to Genesis Healthcare, Inc. $ $ $ Loss income from discontinued operations, net of taxes Net loss attributable to Genesis Healthcare, Inc. $ $ $ |
Schedule of Anti-dilutive Securities (in thousands) | Year ended December 31, 2016 2015 2014 Net loss Net loss Net loss attributable to attributable to attributable to Genesis Antidilutive Genesis Antidilutive Genesis Antidilutive Healthcare, Inc. shares Healthcare, Inc. shares Healthcare, Inc. shares Exchange of restricted stock units of noncontrolling interests $ — — $ $ — — Employee and director unvested restricted stock units — — — — Convertible notes — — — — |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Information | |
Summary of Segmented Revenues | Year ended December 31, 2016 2015 Increase / (Decrease) Revenue Revenue Revenue Revenue Dollars Percentage Dollars Percentage Dollars Percentage (in thousands, except percentages) Revenues: Inpatient services: Skilled nursing facilities $ % $ % $ % Assisted/Senior living facilities % % % Administration of third party facilities % % % Elimination of administrative services — % — % % Inpatient services, net % % % Rehabilitation therapy services: Total therapy services % % % Elimination intersegment rehabilitation therapy services % % % Third party rehabilitation therapy services % % % Other services: Total other services % % % Elimination intersegment other services % % % Third party other services % % % Net revenues $ % $ % $ % Year ended December 31, 2015 2014 Increase / (Decrease) Revenue Revenue Revenue Revenue Dollars Percentage Dollars Percentage Dollars Percentage (in thousands, except percentages) Revenues: Inpatient services: Skilled nursing facilities $ % $ % $ % Assisted/Senior living facilities % % % Administration of third party facilities % % % Elimination of administrative services — % — % % Inpatient services, net % % % Rehabilitation therapy services: Total therapy services % % % Elimination intersegment rehabilitation therapy services % % % Third party rehabilitation therapy services % % % Other services: Total other services % % % Elimination intersegment other services % % % Third party other services % % % Net revenues $ % $ % $ % |
Summaries of Condensed Consolidated Statements of Operations, Total Assets and Goodwill | Year ended December 31, 2016 Rehabilitation Inpatient Therapy Other Services Services Services Corporate Eliminations Consolidated (In thousands) Net revenues $ $ $ $ $ $ Salaries, wages and benefits — — Other operating expenses — General and administrative costs — — — — Provision for losses on accounts receivable — Lease expense — Depreciation and amortization expense — Interest expense — Loss on extinguishment of debt — — — — Investment income — — — — Other income — — — — Transaction costs — — — — Long-lived asset impairments — — — — Skilled Healthcare and other loss contingency expense — — — — Equity in net (income) loss of unconsolidated affiliates — — — (Loss) income before income tax benefit Income tax benefit — — — — (Loss) income from continuing operations $ $ $ $ $ $ Year ended December 31, 2015 Rehabilitation Inpatient Therapy Other Services Services Services Corporate Eliminations Consolidated (In thousands) Net revenues $ $ $ $ $ $ Salaries, wages and benefits — — Other operating expenses — General and administrative costs — — — — Provision for losses on accounts receivable — Lease expense Depreciation and amortization expense — Interest expense Loss on extinguishment of debt — — — — Investment (income) loss — — — Other income — — — — Transaction costs — — — — Long-lived asset impairments — — — — Skilled Healthcare and other loss contingency expense — — — — Equity in net (income) loss of unconsolidated affiliates — — — (Loss) income before income tax expense Income tax expense — — — — (Loss) income from continuing operations $ $ $ $ $ $ Year ended December 31, 2014 Rehabilitation Inpatient Therapy Other Services Services Services Corporate Eliminations Consolidated (In thousands) Net revenues $ $ $ $ $ $ Salaries, wages and benefits — — Other operating expenses — General and administrative costs — — — — Provision for losses on accounts receivable — Lease expense — Depreciation and amortization expense — Interest expense Loss on extinguishment of debt — — — — Investment income — — — Other income — — — — Transaction costs — — — — Long-lived asset impairments — — — — Equity in net (income) loss of unconsolidated affiliates — — — (Loss) income before income tax benefit Income tax benefit — — — — (Loss) income from continuing operations $ $ $ $ $ $ The following table presents the segment assets as of December 31, 2016 compared to December 31, 2015 (in thousands): December 31, 2016 December 31, 2015 Inpatient services $ $ Rehabilitation services Other services Corporate and eliminations Total assets $ $ The following table presents segment goodwill as of December 31, 2016 compared to December 31, 2015 (in thousands): December 31, 2016 December 31, 2015 Inpatient services $ $ Rehabilitation services Other services Total goodwill $ $ |
Restricted Cash and Investmen37
Restricted Cash and Investments in Marketable Securities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Restricted Cash and Investments in Marketable Securities [Abstract] | |
Schedule of Restricted Cash and Investments in Marketable Securities | Restricted cash and investments in marketable securities at December 31, 2016 consist of the following (in thousands): Unrealized losses Amortized Unrealized Less than Greater than cost gains 12 months 12 months Fair value Restricted cash and equivalents: Cash $ $ — $ — $ — $ Money market funds — — — Restricted investments in marketable securities: Mortgage/government backed securities Corporate bonds Government bonds $ $ $ $ Less: Current portion of restricted investments Long-term restricted investments $ Restricted cash and investments in marketable securities at December 31, 2015 consist of the following (in thousands): Unrealized losses Amortized Unrealized Less than Greater than cost gains 12 months 12 months Fair value Restricted cash and equivalents: Cash $ $ — $ — $ — $ Money market funds — — — Restricted investments in marketable securities: Mortgage/government backed securities — — Corporate bonds Government bonds $ $ $ $ Less: Current portion of restricted investments Long-term restricted investments $ |
Schedule of Maturities of Restricted Investments in Marketable Securities | Amortized Fair cost value Due in one year or less $ $ Due after 1 year through 5 years Due after 5 years through 10 years $ $ |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment (in thousands) | December 31, 2016 December 31, 2015 Land, buildings and improvements $ $ Capital lease land, buildings and improvements Financing obligation land, buildings and improvements Equipment, furniture and fixtures Construction in progress Gross property and equipment Less: accumulated depreciation Net property and equipment $ $ |
Goodwill and Identifiable Int39
Goodwill and Identifiable Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Value of Goodwill (in thousands) | Total Balance at December 31, 2014 $ Skilled Combination Acquisition from Revera Other goodwill additions Balance at December 31, 2015 $ Acquisition from Revera Sale of hospice and home health Goodwill associated with assets held for sale Other goodwill additions Balance at December 31, 2016 $ |
Schedule of Identifiable Intangible Assets (in thousands) | Identifiable intangible assets consist of the following at December 31, 2016 and 2015 (in thousands): 2016 Weighted Average Remaining Life (Years) Customer relationship assets, net of accumulated amortization of $43,862 $ 9 Management contracts, net of accumulated amortization of $17,872 2 Favorable leases, net of accumulated amortization of $29,421 10 Trade names Indefinite Identifiable intangible assets $ 2015 Weighted Average Remaining Life (Years) Customer relationship assets, net of accumulated amortization of $34,336 $ 10 Management contracts, net of accumulated amortization of $8,093 3 Favorable leases, net of accumulated amortization of $24,141 10 Trade names Indefinite Identifiable intangible assets $ |
Long-term Debt (Tables)
Long-term Debt (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Long-Term Debt Abstract | |
Schedule of Long-term Debt (in thousands) | December 31, December 31, 2016 2015 Revolving credit facilities, net of debt issuance costs of $9,220 at December 31, 2016 and $10,254 at December 31, 2015 $ $ Term loan facility, net of original issue discount of $7,475 and net of debt issuance costs of $10,129 at December 31, 2015 — New term loan agreement, net of debt issuance costs of $3,859 at December 31, 2016 — Real estate bridge loans, net of debt issuance costs of $4,400 at December 31, 2016 and $9,567 at December 31, 2015 HUD insured loans, net of debt issuance costs of $4,773 at December 31, 2016 and $1,395 at December 31, 2015 Notes payable, net of convertible debt discount of $990 at December 31, 2016 — Mortgages and other secured debt (recourse) Mortgages and other secured debt (non-recourse), net of debt issuance costs of $131 at December 31, 2016 and $176 at December 31, 2015 Less: Current installments of long-term debt Long-term debt $ $ |
Schedule of Borrowings and Interest Rates (dollars in thousands) | Weighted Average Revolving Credit Facilities Commitment Borrowings Interest FILO tranche $ $ % Tranche A-1 % Tranche A-2 % HUD tranche % $ $ % |
Schedule of Maturity of Total Debt (in thousands) | Twelve months ended December 31, 2017 $ 2018 2019 2020 2021 Thereafter Total debt maturity $ |
Leases and Lease Commitments (T
Leases and Lease Commitments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Leases and Lease Commitments | |
Schedule of Future Minimum Capital and Operating Lease Payments (in thousands) | Twelve months ended December 31, Capital Leases Operating Leases 2017 $ $ 2018 2019 2020 2021 Thereafter Total future minimum lease payments $ Less amount representing interest Capital lease obligation Less current portion Long-term capital lease obligation $ |
Financing Obligation (Tables)
Financing Obligation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Financing Obligation | |
Schedule of Future Minimum Financing Lease Payments (in thousands) | Twelve months ended December 31, 2017 $ 2018 2019 2020 2021 Thereafter Total future minimum lease payments Less amount representing interest Financing obligations $ Less current portion Long-term financing obligations $ |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Share-based Payment Award, Employee Stock Purchase Plan, Valuation Assumptions | December 31, 2016 December 31, 2015 Expected term, in years Risk-free interest rate Volatility 45% - 55% Dividends N/A N/A |
Schedule of Nonvested Share Activity | Number of Shares Weighted-Average Grant Date Fair Value RSU PSU RSU PSU Non-vested balance at January 1, 2015 — — $ — $ — Granted Vested — — Forfeited Non-vested balance at December 31, 2015 $ $ Granted Vested — — Forfeited Non-vested balance at December 31, 2016 $ $ |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of total income tax (benefit) expense by income category | Year ended December 31, 2016 2015 2014 Continuing operations $ $ $ Discontinued operations Noncontrolling interests — — Stockholder's deficit Total $ $ $ |
Schedule of Components of Income Tax Expense (Benefit) | Year ended December 31, 2016 2015 2014 Current: Federal $ $ $ State Deferred: Federal State Total $ $ $ |
Schedule of Effective Income Tax Rate Reconciliation | Year ended December 31, 2016 2015 2014 Computed “expected” benefit $ $ $ (Reduction) increase in income taxes resulting from: State and local income taxes, net of federal tax benefit Adjustment to income taxes for income not subject to corporate income tax — Income tax credits Non-controlling interest — Adjustment to deferred taxes, including credits and valuation allowance FIN 48 Other, net Total income tax (benefit) expense $ $ $ |
Schedule of Deferred Tax Assets and Liabilities | 2016 2015 Deferred tax assets: Investment in partnership Net operating loss carryforwards Discounted unpaid loss reserve Other intangible — General business credits Total deferred tax assets Valuation allowance Deferred tax assets, net of valuation allowance Deferred tax liabilities: Long-lived assets: intangible property Total deferred tax liabilities Net deferred tax liabilities |
Schedule of Unrecognized Tax Benefits Roll Forward | Balance, December 31, 2013 $ Additions based upon tax positions related to the current year Balance, December 31, 2014 $ Additions recorded in purchase accounting Balance, December 31, 2015 $ Reductions due to lapses of applicable statute of limitations Balance, December 31, 2016 $ |
Other Income (Tables)
Other Income (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Income and Expenses [Abstract] | |
Summary of Net Gains Recorded In Other Income | Year ended December 31, 2016 Gain on sale of hospice and home health $ Gain on sale of investment in joint venture Gain on escrow receipt associated with terminated sale agreement Gain on sale of other owned assets, net Gain on leased facilities sold to new landlord and operating under new lease agreements Gain on divested facilities terminated from lease agreements $ |
Assets Held for Sale and Disc46
Assets Held for Sale and Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disposal Group, Held-for-sale, Not Discontinued Operations | |
Summary of Balance Sheet and Income Statement Information for Disposal Group and Discontinued Operations | December 31, 2016 Current assets: Prepaid expenses $ Long-term assets: Property and equipment, net of accumulated depreciation of $10,792 Goodwill Total assets $ Current liabilities: Current installments of long-term debt $ Long-term liabilities: Long-term debt Total liabilities $ |
Discontinued Operations | |
Summary of Balance Sheet and Income Statement Information for Disposal Group and Discontinued Operations | Year ended December 31, 2016 2015 2014 Net revenues $ $ $ Net operating income (loss) of discontinued businesses $ $ $ Loss on discontinuation of business — — Income tax (expense) benefit Income (loss) from discontinued operations, net of taxes $ $ $ |
Fair Value of Financial Instr47
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value of Financial Instruments | |
Schedule of Fair Value of Assets Measured on a Recurring Basis (in thousands) | Fair Value Measurements at Reporting Date Using Quoted Prices in Significant Active Markets for Significant Other Unobservable December 31, Identical Assets Observable Inputs Inputs Assets: 2016 (Level 1) (Level 2) (Level 3) Cash and cash equivalents $ $ $ — $ — Restricted cash and equivalents — — Restricted investments in marketable securities: Mortgage/government backed securities — — Corporate bonds — — Government bonds — — Total $ $ $ — $ — Fair Value Measurements at Reporting Date Using Quoted Prices in Significant Active Markets for Significant Other Unobservable December 31, Identical Assets Observable Inputs Inputs Assets: 2015 (Level 1) (Level 2) (Level 3) Cash and cash equivalents $ $ $ — $ — Restricted cash and equivalents — — Restricted investments in marketable securities: Mortgage/government backed securities — — Corporate bonds — — Government bonds — — Total $ $ $ — $ — |
Schedule of Carrying Amounts and Estimated Fair Values of Long-term Debt Instruments | December 31, 2016 December 31, 2015 Carrying Value Fair Value Carrying Value Fair Value Revolving credit facilities $ $ $ $ Term loan facility — — New term loan agreement — — Real estate bridge loans HUD insured loans Notes payable — — Mortgages and other secured debt (recourse) Mortgages and other secured debt (non-recourse) $ $ $ $ |
Schedule of Hierarchy of Nonfinancial Assets Measured at Fair Value on a Nonrecurring Basis (in thousands) | Impairment Charges - Carrying Value Year ended December 31, 2016 December 31, 2016 Assets: Property and equipment, net $ $ Goodwill — Intangible assets Impairment Charges - Carrying Value Year ended December 31, 2015 December 31, 2015 Assets: Property and equipment, net $ $ Goodwill — Intangible assets |
Quarterly Financial Informati48
Quarterly Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | Quarter ended March 31, 2016 June 30, 2016 September 30, 2016 December 31, 2016 Net revenues $ $ $ $ Net loss attributable to Genesis Healthcare, Inc.: (Loss) income from continuing operations attributable to Genesis Healthcare, Inc. $ $ $ $ (1) (Loss) income from discontinued operations, net of taxes Net (loss) income attributable to Genesis Healthcare, Inc. $ $ $ $ Net (loss) income per common share attributable to Genesis Healthcare, Inc.: Basic Diluted Weighted average shares used in computing (loss) income per common share: Basic Diluted Quarter ended March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 Net revenues $ (2) $ $ $ Net loss attributable to Genesis Healthcare, Inc.: Loss from continuing operations attributable to Genesis Healthcare, Inc. $ (3) $ $ $ (4) Income (loss) from discontinued operations, net of taxes Net loss attributable to Genesis Healthcare, Inc. $ $ $ $ Loss per common share: Basic and diluted: Net loss attributable to Genesis Healthcare, Inc. Shares used in computing loss per common share 1) The quarter ended December 31, 2016 includes gains of approximately $160 million associated with the sales of owned assets, divestitures of leased facilities and other lease transactions offset by approximately $35 million associated with long-lived asset impairments. 2) The quarter ended March 31, 2015 includes two months of revenue associated with the Combination. 3) The quarter ended March 31, 2015 includes transaction costs associated with the Combination. The quarter ended December 31, 2015 includes a deferred tax valuation allowance of $221.9 million recorded as income tax expense and $28.5 million of long-lived asset impairments. |
General Information (Details)
General Information (Details) | 12 Months Ended | ||
Dec. 31, 2016statefacility | Dec. 31, 2015 | Dec. 31, 2014 | |
Facility Count | |||
Concentration risk (as a percent) | 100.00% | 100.00% | 100.00% |
Inpatient Services | |||
Facility Count | |||
Number of skilled nursing, assisted/senior living and behavioral health centers through which inpatient services are provided | facility | 499 | ||
Number of states with facilities | state | 34 | ||
Concentration risk (as a percent) | 85.60% | 84.50% | 84.70% |
Inpatient Services | Revenue | Product Concentration Risk | |||
Facility Count | |||
Concentration risk (as a percent) | 86.00% | ||
Rehabilitation therapy service | |||
Facility Count | |||
Concentration risk (as a percent) | 11.60% | 11.90% | 12.70% |
Rehabilitation therapy service | Revenue | Product Concentration Risk | |||
Facility Count | |||
Concentration risk (as a percent) | 12.00% |
Summary of Significant Accoun50
Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment | |||
Restricted cash and investments in marketable securities | $ 156 | $ 198.1 | |
Depreciation expense | $ 234.7 | $ 218.8 | $ 184.3 |
Buildings and improvements | Minimum | |||
Property, Plant and Equipment | |||
Property and equipment, useful life | 20 years | ||
Buildings and improvements | Maximum | |||
Property, Plant and Equipment | |||
Property and equipment, useful life | 35 years | ||
Land Improvements [Member] | Minimum | |||
Property, Plant and Equipment | |||
Property and equipment, useful life | 20 years | ||
Land Improvements [Member] | Maximum | |||
Property, Plant and Equipment | |||
Property and equipment, useful life | 35 years | ||
Equipment [Member] | Minimum | |||
Property, Plant and Equipment | |||
Property and equipment, useful life | 3 years | ||
Equipment [Member] | Maximum | |||
Property, Plant and Equipment | |||
Property and equipment, useful life | 15 years | ||
Furniture and Fixtures [Member] | Minimum | |||
Property, Plant and Equipment | |||
Property and equipment, useful life | 3 years | ||
Furniture and Fixtures [Member] | Maximum | |||
Property, Plant and Equipment | |||
Property and equipment, useful life | 15 years | ||
Computer Equipment [Member] | Minimum | |||
Property, Plant and Equipment | |||
Property and equipment, useful life | 3 years | ||
Computer Equipment [Member] | Maximum | |||
Property, Plant and Equipment | |||
Property and equipment, useful life | 15 years |
Certain Significant Risks and51
Certain Significant Risks and Uncertainties (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Concentration Risk | |||
Concentration risk (as a percent) | 100.00% | 100.00% | 100.00% |
Inpatient Services | |||
Concentration Risk | |||
Concentration risk (as a percent) | 85.60% | 84.50% | 84.70% |
Government contracts | Revenue | Inpatient Services | |||
Concentration Risk | |||
Concentration risk (as a percent) | 100.00% | 100.00% | 100.00% |
Government contracts | Revenue | Medicare and Medicaid | Inpatient Services | |||
Concentration Risk | |||
Concentration risk (as a percent) | 79.00% | ||
Government contracts | Revenue | Medicare | Inpatient Services | |||
Concentration Risk | |||
Concentration risk (as a percent) | 24.00% | 26.00% | 27.00% |
Government contracts | Revenue | Medicaid | Inpatient Services | |||
Concentration Risk | |||
Concentration risk (as a percent) | 55.00% | 53.00% | 53.00% |
Government contracts | Revenue | Insurance | Inpatient Services | |||
Concentration Risk | |||
Concentration risk (as a percent) | 11.00% | 11.00% | 10.00% |
Government contracts | Revenue | Private and Other | Inpatient Services | |||
Concentration Risk | |||
Concentration risk (as a percent) | 10.00% | 10.00% | 10.00% |
Significant Transactions and 52
Significant Transactions and Events - Acquisitions (Details) $ / shares in Units, $ in Thousands | Dec. 22, 2016facility | Nov. 01, 2016facility | Sep. 01, 2016USD ($)facility | Dec. 01, 2015USD ($)facility | Feb. 02, 2015USD ($) | Aug. 17, 2014 | Dec. 31, 2015USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($)$ / shares | Dec. 31, 2014USD ($)$ / shares | Dec. 31, 2016USD ($)shares | Jun. 15, 2015USD ($)facility |
Business Acquisition [Line Items] | ||||||||||||
Ownership interest in combined entity (as a percent) | 50.00% | 50.00% | ||||||||||
Debt issuance costs | $ 14,524 | $ 19,193 | $ 7,916 | |||||||||
Consideration Price Allocation | ||||||||||||
Goodwill | $ 470,019 | 440,712 | 470,019 | 169,681 | $ 440,712 | |||||||
Acquisition from Revere | ||||||||||||
Number of facilities under lease | facility | 28 | 64 | ||||||||||
Amount paid in cash | 93,118 | 85,723 | 70,987 | |||||||||
Financing obligation incurred | 56,766 | 13,096 | ||||||||||
FC-GEN Operations Investment, LLC | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Goodwill, tax deductible portion | $ 79,800 | |||||||||||
Transaction costs in acquisition | 89,200 | 89,200 | ||||||||||
Debt issuance costs | 17,800 | |||||||||||
Consideration Price Allocation | ||||||||||||
Accounts receivable | 114,032 | |||||||||||
Deferred income taxes and other current assets | 39,586 | |||||||||||
Property, plant and equipment | 488,528 | |||||||||||
Total identifiable intangible assets | 65,810 | |||||||||||
Deferred income taxes and other assets | 76,461 | |||||||||||
Accounts payable and other current liabilities | (121,479) | |||||||||||
Long-term debt, including amounts due within one year | (428,453) | |||||||||||
Unfavorable lease contracts | (11,480) | |||||||||||
Deferred income taxes and other long-term liabilities | (141,914) | |||||||||||
Total identifiable net assets | 81,091 | |||||||||||
Goodwill | 267,050 | |||||||||||
Net assets | 348,141 | |||||||||||
Pro Forma Information | ||||||||||||
Revenue of acquiree | 832,000 | |||||||||||
Net loss of acquiree | $ 10,500 | |||||||||||
Revenues | 5,690,512 | 5,601,336 | ||||||||||
Loss attributable to Genesis Healthcare, Inc. | $ (315,329) | $ (118,071) | ||||||||||
Net loss per share, Basic | $ / shares | $ (3.54) | $ (1.32) | ||||||||||
Net loss per share, Diluted | $ / shares | $ (3.54) | $ (1.51) | ||||||||||
FC-GEN Operations Investment, LLC | Accounting, investment banking, legal and other costs | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Transaction costs in acquisition | 31,600 | 31,600 | ||||||||||
FC-GEN Operations Investment, LLC | Management Incentive Compensation Charges | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Transaction costs in acquisition | 54,600 | 54,600 | ||||||||||
FC-GEN Operations Investment, LLC | Transaction Advisory Fee | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Transaction costs in acquisition | $ 3,000 | $ 3,000 | ||||||||||
FC-GEN Operations Investment, LLC | Trade names | ||||||||||||
Consideration Price Allocation | ||||||||||||
Indefinite lived intangible assets | 3,400 | |||||||||||
FC-GEN Operations Investment, LLC | Management contracts | ||||||||||||
Consideration Price Allocation | ||||||||||||
Finite lived intangible assets | $ 30,900 | |||||||||||
Weighted average life (in years) | 3 years 6 months | |||||||||||
FC-GEN Operations Investment, LLC | Customer relationships | ||||||||||||
Consideration Price Allocation | ||||||||||||
Finite lived intangible assets | $ 13,400 | |||||||||||
Weighted average life (in years) | 10 years | |||||||||||
FC-GEN Operations Investment, LLC | Favorable lease contracts | ||||||||||||
Consideration Price Allocation | ||||||||||||
Finite lived intangible assets | $ 18,110 | |||||||||||
Weighted average life (in years) | 12 years 9 months 18 days | |||||||||||
FC-GEN Operations Investment, LLC | Former Owners of FC-GEN and Skilled Healthcare | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Noncontrolling interest held after transaction (as a percent) | 42.00% | 41.00% | 41.00% | |||||||||
Convertible noncontrolling interest (as a percent) | 42.00% | |||||||||||
Conversion ratio | 1 | |||||||||||
Number of Class A common units converted to public shares | shares | 600,000 | |||||||||||
FC-GEN Operations Investment, LLC | Former owners of FC-GEN | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Ownership interest in combined entity (as a percent) | 74.25% | |||||||||||
Direct controlling interest held pre-transaction (as a percent) | 58.00% | |||||||||||
Economic voting interest held pre-transaction (as a percent) | 74.25% | |||||||||||
FC-GEN Operations Investment, LLC | Former shareholders of Skilled Healthcare Group, Inc. | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Noncontrolling interest held after transaction (as a percent) | 25.75% | |||||||||||
Revera Acquisition | ||||||||||||
Acquisition from Revere | ||||||||||||
Number of facilities under asset purchase agreement | facility | 24 | |||||||||||
Asset purchase agreement amount | $ 240,000 | |||||||||||
Number of Acquired Facilities to be Operated By the Entity | facility | 5 | 20 | ||||||||||
Number of Acquired Facilities to Be Operated By Another Entity | facility | 4 | |||||||||||
Number of facilities acquired | facility | 5 | 19 | ||||||||||
Number of owned facilities | facility | 15 | |||||||||||
Number of facilities under lease | facility | 4 | |||||||||||
Facilities purchase price | $ 39,400 | $ 206,000 | ||||||||||
Amount financed with bridge loan | $ 37,000 | 134,100 | ||||||||||
Amount paid in cash | 20,500 | |||||||||||
Financing obligation incurred | $ 54,300 |
Significant Transactions and 53
Significant Transactions and Events - Divestitures (Details) $ in Thousands | Dec. 31, 2016USD ($)facility | Dec. 22, 2016USD ($)facility | Dec. 15, 2016USD ($) | Nov. 01, 2016facility | Oct. 23, 2016USD ($)facility | Oct. 18, 2016USD ($)facility | May 01, 2016USD ($) | Jan. 01, 2016USD ($)facility | Mar. 31, 2016USD ($) | Dec. 31, 2016facility | Dec. 31, 2016USD ($)facility | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Sale of facilities | |||||||||||||
Sales of assets | $ 150,675 | $ 3,738 | $ 5,227 | ||||||||||
Partial pay down on loans | 500,101 | 357,716 | 17,946 | ||||||||||
Gain on sale | 134,100 | ||||||||||||
Proceeds from Issuance of Long-term Debt | $ 416,161 | $ 495,201 | $ 960 | ||||||||||
Income Statement Disclosures | |||||||||||||
Number of facilities under lease | facility | 28 | 64 | |||||||||||
Number of facilities classified as held for sale | facility | 16 | 16 | 16 | 16 | |||||||||
Ownership interest | 50.00% | 50.00% | 50.00% | ||||||||||
Nonstrategic Facilities And Investments [Member] | |||||||||||||
Income Statement Disclosures | |||||||||||||
Gain on escrow receipt associated with terminated sale agreement | $ 5,000 | $ 5,000 | |||||||||||
Disposed by sale | Kansas Assisted Senior Living Facilities [Member] | |||||||||||||
Sale of facilities | |||||||||||||
Number of facilities sold | facility | 18 | ||||||||||||
Sales of assets | $ 67,000 | ||||||||||||
Partial pay down on loans | $ 54,200 | ||||||||||||
Disposed by sale | Hospice And Home Health Operations | |||||||||||||
Sale of facilities | |||||||||||||
Sales price per agreement | $ 84,000 | ||||||||||||
Cash proceeds | $ 72,000 | ||||||||||||
Noncash consideration received in disposal | 12,000 | ||||||||||||
Gain on sale | 43,400 | 43,420 | |||||||||||
Derecognition of goodwill and identifiable intangible assets | $ 30,800 | ||||||||||||
Disposed by sale | Hospice And Home Health Operations | Director | |||||||||||||
Sale of facilities | |||||||||||||
Aggregate ownership interest in counterparty indirectly held by certain board members, as a percent | 10.00% | ||||||||||||
Disposed by sale | Nonstrategic Facilities And Investments [Member] | |||||||||||||
Sale of facilities | |||||||||||||
Number of facilities sold | facility | 18 | 9 | 18 | ||||||||||
Cash proceeds | $ 80,000 | ||||||||||||
Gain on sale | $ 1,900 | $ 19,800 | |||||||||||
Income Statement Disclosures | |||||||||||||
Annual revenue | 110,100 | 22,500 | |||||||||||
Pretax net loss | $ 10,700 | $ 3,300 | |||||||||||
Number of facilities under lease | facility | 2 | 2 | |||||||||||
Number of owned facilities | facility | 16 | 16 | |||||||||||
Total assets | $ 80,000 | ||||||||||||
Proceeds from sale of joint venture | $ 5,400 | ||||||||||||
Joint venture investment written off | 1,500 | ||||||||||||
Gain on sale of joint venture interest | $ 3,900 | $ 3,910 | |||||||||||
HUD insured loans | |||||||||||||
Sale of facilities | |||||||||||||
Number of facilities financed by HUD | facility | 28 | ||||||||||||
Proceeds from Issuance of Long-term Debt | $ 205,300 |
Significant Transactions and 54
Significant Transactions and Events - Master Lease (Details) item in Millions, $ in Millions | Dec. 23, 2016USD ($)facilityitemloan | Dec. 22, 2016facility | Nov. 01, 2016USD ($)facility | Oct. 31, 2016 | Dec. 31, 2016USD ($) |
Number of facilities under lease | facility | 28 | 64 | |||
Percentage of Annual Escalators | 2.00% | 3.40% | 3.40% | ||
Percent Of Annual Escalators After Decrease | 2.9 | 2.9 | |||
Percentage of Decrease in Initial Annual Rent | 5.00% | 5.00% | |||
Capital Leases, Rent Expense | $ 54.5 | $ 103.9 | |||
Percentage Of Annual Escalators In Year Three | 1.5 | ||||
Percentage Of Annual Escalators In Year Two | 1 | ||||
Percentage Of Annual Escalators Thereafter | 2 | ||||
Reduction Of Cumulative Rent Obligations Through January 2032 | $ 143 | $ 297 | |||
Number Of Facilities Under New Master Lease Agreement | facility | 28 | ||||
Reduction in financing obligations | $ 208.9 | ||||
Step-down in capital lease asset and obligation | 21.4 | ||||
Establishment of notes payable | 74.8 | ||||
Gain on leased facilities sold to new landlord and operating under new lease agreements | $ 134.1 | ||||
Welltower Notes Due December 2021 [Member] | |||||
Number of notes issued | loan | 2 | ||||
Debt Instrument, Term | 5 years | ||||
Debt Instrument, Face Amount | $ 23.7 | ||||
Note Payable Due October 30, 2020 | |||||
Notes issued | $ 51.2 | ||||
Convertible Note Payable Due December 15 2021 | |||||
Debt Instrument, Face Amount | $ 12 | ||||
Number of shares into which the debt instrument may be converted | item | 3 | ||||
Welltower Inc | |||||
Number of facilities sold | facility | 28 | 64 |
Loss Per Share - Calculation of
Loss Per Share - Calculation of Basic (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016USD ($)$ / sharesshares | Sep. 30, 2016USD ($)$ / sharesshares | Jun. 30, 2016USD ($)$ / sharesshares | Mar. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2016USD ($)class$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | |
Income Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||||||||
Number of classes of common stock | class | 3 | ||||||||||
Numerator: | |||||||||||
Loss from continuing operations | $ 22,429 | $ (20,434) | $ (23,034) | $ (43,001) | $ (265,843) | $ (28,991) | $ (17,464) | $ (112,678) | $ (118,078) | $ (525,549) | $ (237,485) |
Net loss (income) attributable to noncontrolling interests | (54,038) | (100,573) | 2,456 | ||||||||
Loss from continuing operations attributable to Genesis Healthcare, Inc. | (64,040) | (424,976) | (239,941) | ||||||||
Income (loss) from discontinued operations, net of taxes | 27 | (1,219) | (14,044) | ||||||||
Net loss attributable to Genesis Healthcare, Inc | $ 22,457 | $ (20,458) | $ (22,973) | $ (43,039) | $ (265,491) | $ (28,952) | $ (19,186) | $ (112,566) | $ (64,013) | $ (426,195) | $ (253,985) |
Denominator: | |||||||||||
Weighted-average shares outstanding for net loss per share | shares | 90,636 | 90,226 | 89,421 | 89,198 | 89,873 | 85,755 | 49,865 | ||||
Loss from continuing operations attributable to Genesis Healthcare, Inc | $ / shares | $ (0.71) | $ (4.96) | $ (4.81) | ||||||||
(Loss) income from discontinued operations, net of taxes | $ / shares | 0 | (0.01) | (0.28) | ||||||||
Net loss attributable to Genesis Healthcare, Inc. | $ / shares | $ 0.25 | $ (0.23) | $ (0.26) | $ (0.48) | $ (0.71) | $ (4.97) | $ (5.09) | ||||
Class C Common Stock | |||||||||||
Income Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||||||||
Voting ratio | 1 | ||||||||||
Number of classes of stock that share voting ratio | class | 2 |
Loss Per Share - Calculation 56
Loss Per Share - Calculation of diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Numerator: | |||||||||||
Loss from continuing operations | $ 22,429 | $ (20,434) | $ (23,034) | $ (43,001) | $ (265,843) | $ (28,991) | $ (17,464) | $ (112,678) | $ (118,078) | $ (525,549) | $ (237,485) |
Less: Net (loss) income attributable to noncontrolling interests | (54,038) | (100,573) | 2,456 | ||||||||
Loss from continuing operations attributable to Genesis Healthcare, Inc. | (64,040) | (424,976) | (239,941) | ||||||||
Income (loss) from discontinued operations, net of taxes | 27 | (1,219) | (14,044) | ||||||||
Net loss attributable to Genesis Healthcare, Inc | $ 22,457 | $ (20,458) | $ (22,973) | $ (43,039) | $ (265,491) | $ (28,952) | $ (19,186) | $ (112,566) | (64,013) | (426,195) | (253,985) |
Plus: Exchange of restricted stock units of noncontrolling interests | (61,258) | ||||||||||
Net loss available to common stockholders after assumed conversions | $ (125,271) | $ (426,195) | $ (253,985) | ||||||||
Denominator: | |||||||||||
Weighted-average shares outstanding for net loss per share | 90,636 | 90,226 | 89,421 | 89,198 | 89,873 | 85,755 | 49,865 | ||||
Effect of dilutive shares: | |||||||||||
Exchange of restricted stock units of noncontrolling interests | 64,340 | ||||||||||
Employee and director unvested restricted stock units | (1,681) | ||||||||||
Dilutive potential common shares | 62,659 | ||||||||||
Adjusted weighted-average common shares outstanding, diluted | 92,337 | 90,226 | 89,421 | 89,198 | 152,532 | 85,755 | 49,865 | ||||
Diluted net loss per common share: | |||||||||||
Loss from continuing operations attributable to Genesis Healthcare, Inc. | $ (0.82) | $ (4.96) | $ (4.81) | ||||||||
(Loss) income from discontinued operations, net of taxes | 0 | (0.01) | (0.28) | ||||||||
Net loss attributable to Genesis Healthcare, Inc. | $ 0.24 | $ (0.23) | $ (0.26) | $ (0.48) | $ (0.82) | $ (4.97) | $ (5.09) |
Loss Per Share - Antidilutive S
Loss Per Share - Antidilutive Securities (Details) $ in Thousands, item in Millions | Aug. 05, 2016shares | Jun. 08, 2016shares | Dec. 31, 2016USD ($)itemshares | Dec. 31, 2015USD ($)shares |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net loss attributable to Genesis Healthcare, Inc. | $ | $ (61,258) | |||
Convertible notes | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net loss attributable to Genesis Healthcare, Inc. | $ | $ (11) | |||
Antidilutive shares | 74,000 | |||
Restricted Stock Units (RSUs) | Noncontrolling interests | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net loss attributable to Genesis Healthcare, Inc. | $ | $ (54,761) | |||
Antidilutive shares | 58,810,000 | |||
Class A Common Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Incremental Class A stock attributable to conversion of noncontrolling interest | 11,117 | |||
Number of shares into which the debt instrument may be converted | item | 3 | |||
Class C Common Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of units attributed to the noncontrolling interests outstanding | 63,849,380 | |||
Employee And Non-employee Director | Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive shares | 1,715,000 | 124,000 | ||
2015 Omnibus Equity Incentive Plan | Tranche One | Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Shares vested | 984,849 | |||
Shares issued | 886,056 | |||
2015 Omnibus Equity Incentive Plan | Tranche One | Director | Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Granted (in units) | 360,000 | |||
2015 Omnibus Equity Incentive Plan | Tranche One | Employee | Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Granted (in units) | 4,339,932 | |||
2015 Omnibus Equity Incentive Plan | Tranche Two | Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Shares vested | 90,914 | |||
Shares issued | 90,914 | |||
2015 Omnibus Equity Incentive Plan | Tranche Two | Employee | Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Granted (in units) | 503,834 |
Segment Information - Segment R
Segment Information - Segment Reporting (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2016USD ($)segment | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Segment Reporting Information | |||||||||||
Number of Reportable Segments | segment | 3 | ||||||||||
Net revenues | $ 1,402,860 | $ 1,418,994 | $ 1,438,358 | $ 1,472,218 | $ 1,440,721 | $ 1,416,027 | $ 1,419,475 | $ 1,343,001 | $ 5,732,430 | $ 5,619,224 | $ 4,768,080 |
Concentration Risk, Percentage | 100.00% | 100.00% | 100.00% | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ 113,206 | $ 851,144 | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | 2.00% | 17.90% | |||||||||
Salaries, wages and benefits | $ 3,369,713 | $ 3,289,820 | $ 2,904,094 | ||||||||
Other operating expenses | 1,413,639 | 1,358,983 | 1,109,699 | ||||||||
General and administrative costs | 186,062 | 175,889 | 147,063 | ||||||||
Provision for losses on accounts receivable | 107,815 | 100,521 | 77,670 | ||||||||
Lease expense | 146,244 | 150,276 | 131,898 | ||||||||
Depreciation and amortization expense | 254,459 | 237,617 | 193,675 | ||||||||
Interest expense | 528,544 | 507,809 | 442,724 | ||||||||
Loss on early extinguishment of debt | 16,290 | 130 | 1,133 | ||||||||
Investment income | (3,018) | (1,677) | (3,399) | ||||||||
Other income | (207,070) | (1,400) | (138) | ||||||||
Transaction costs | 7,928 | 96,374 | 13,353 | ||||||||
Long-lived asset impairments | 35,431 | 28,546 | 31,399 | ||||||||
Skilled Healthcare and other loss contingency expense | 15,192 | 31,500 | |||||||||
Equity in net (income) loss of unconsolidated affiliates | (3,286) | (2,139) | 416 | ||||||||
(Loss) income before income tax benefit | (135,513) | (353,025) | (281,507) | ||||||||
Income tax (benefit) expense | (17,435) | 172,524 | (44,022) | ||||||||
(Loss) income from continuing operations | $ 22,429 | $ (20,434) | $ (23,034) | $ (43,001) | $ (265,843) | $ (28,991) | $ (17,464) | $ (112,678) | (118,078) | (525,549) | (237,485) |
Inpatient Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ 4,908,636 | $ 4,748,680 | $ 4,039,813 | ||||||||
Concentration Risk, Percentage | 85.60% | 84.50% | 84.70% | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ 159,956 | $ 708,867 | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | 3.40% | 17.50% | |||||||||
Long-lived asset impairments | $ 35,400 | $ 28,500 | $ 31,400 | ||||||||
Inpatient Services | Skilled Nursing Facilities | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ 4,783,117 | $ 4,597,671 | $ 3,924,571 | ||||||||
Concentration Risk, Percentage | 83.40% | 81.70% | 82.30% | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ 185,446 | $ 673,100 | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | 4.00% | 17.20% | |||||||||
Inpatient Services | Assisted Senior Living Facilities | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ 115,956 | $ 143,321 | $ 107,034 | ||||||||
Concentration Risk, Percentage | 2.00% | 2.60% | 2.20% | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ (27,365) | $ 36,287 | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | (19.10%) | 33.90% | |||||||||
Inpatient Services | Administration of third party facilities | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ 10,969 | $ 9,488 | $ 10,297 | ||||||||
Concentration Risk, Percentage | 0.20% | 0.20% | 0.20% | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ 1,481 | $ (809) | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | 15.60% | (7.90%) | |||||||||
Rehabilitation therapy service | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ 661,627 | $ 669,302 | $ 604,360 | ||||||||
Concentration Risk, Percentage | 11.60% | 11.90% | 12.70% | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ (7,675) | $ 64,942 | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | (1.10%) | 10.70% | |||||||||
Rehabilitation therapy service | Therapy Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ 1,070,314 | $ 1,099,130 | $ 990,081 | ||||||||
Concentration Risk, Percentage | 18.70% | 19.60% | 20.80% | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ (28,816) | $ 109,049 | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | (2.60%) | 11.00% | |||||||||
Other Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ 162,167 | $ 201,242 | $ 123,907 | ||||||||
Concentration Risk, Percentage | 2.80% | 3.60% | 2.60% | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ (39,075) | $ 77,335 | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | (19.40%) | 62.40% | |||||||||
Other Services | Other Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ 185,521 | $ 240,350 | $ 154,011 | ||||||||
Concentration Risk, Percentage | 3.20% | 4.30% | 3.20% | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ (54,829) | $ 86,339 | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | (22.80%) | 56.10% | |||||||||
Operating Segments | Inpatient Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ 4,910,042 | $ 4,750,480 | $ 4,041,902 | ||||||||
Salaries, wages and benefits | 2,342,362 | 2,248,197 | 1,987,550 | ||||||||
Other operating expenses | 1,720,199 | 1,684,487 | 1,417,738 | ||||||||
Provision for losses on accounts receivable | 89,838 | 80,998 | 54,582 | ||||||||
Lease expense | 142,717 | 146,329 | 130,005 | ||||||||
Depreciation and amortization expense | 223,007 | 206,026 | 165,105 | ||||||||
Interest expense | 434,938 | 423,393 | 393,521 | ||||||||
(Loss) income before income tax benefit | (43,019) | (38,950) | (106,599) | ||||||||
(Loss) income from continuing operations | (43,019) | (38,950) | (106,599) | ||||||||
Operating Segments | Rehabilitation therapy service | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | 1,070,314 | 1,099,130 | 990,081 | ||||||||
Salaries, wages and benefits | 901,578 | 898,226 | 817,144 | ||||||||
Other operating expenses | 79,056 | 74,210 | 62,032 | ||||||||
Provision for losses on accounts receivable | 16,905 | 17,604 | 16,500 | ||||||||
Lease expense | 89 | 106 | 176 | ||||||||
Depreciation and amortization expense | 12,288 | 12,931 | 11,055 | ||||||||
Interest expense | 57 | 31 | 4 | ||||||||
(Loss) income before income tax benefit | 60,341 | 96,022 | 83,170 | ||||||||
(Loss) income from continuing operations | 60,341 | 96,022 | 83,170 | ||||||||
Operating Segments | Other Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | 184,775 | 238,585 | 153,397 | ||||||||
Salaries, wages and benefits | 125,773 | 143,397 | 99,400 | ||||||||
Other operating expenses | 47,831 | 70,770 | 47,844 | ||||||||
Provision for losses on accounts receivable | 1,260 | 2,704 | 6,618 | ||||||||
Lease expense | 1,490 | 2,316 | 821 | ||||||||
Depreciation and amortization expense | 970 | 1,227 | 917 | ||||||||
Interest expense | 39 | 40 | 19 | ||||||||
(Loss) income before income tax benefit | 7,412 | 18,131 | (2,222) | ||||||||
(Loss) income from continuing operations | 7,412 | 18,131 | (2,222) | ||||||||
Corporate, Non-Segment | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | 746 | 1,765 | 614 | ||||||||
General and administrative costs | 186,062 | 175,889 | 147,063 | ||||||||
Provision for losses on accounts receivable | (188) | (785) | (30) | ||||||||
Lease expense | 1,948 | 1,779 | 896 | ||||||||
Depreciation and amortization expense | 18,194 | 17,433 | 16,598 | ||||||||
Interest expense | 93,510 | 84,635 | 49,678 | ||||||||
Loss on early extinguishment of debt | 16,290 | 130 | 1,133 | ||||||||
Investment income | (3,018) | (1,967) | (3,897) | ||||||||
Other income | (207,070) | (1,400) | (138) | ||||||||
Transaction costs | 7,928 | 96,374 | 13,353 | ||||||||
Long-lived asset impairments | 35,431 | 28,546 | 31,399 | ||||||||
Skilled Healthcare and other loss contingency expense | 15,192 | 31,500 | |||||||||
Equity in net (income) loss of unconsolidated affiliates | (5,452) | (3,931) | (1,284) | ||||||||
(Loss) income before income tax benefit | (158,081) | (426,438) | (254,157) | ||||||||
Income tax (benefit) expense | (17,435) | 172,524 | (44,022) | ||||||||
(Loss) income from continuing operations | (140,646) | (598,962) | (210,135) | ||||||||
Elimination | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | (433,447) | (470,736) | (417,914) | ||||||||
Other operating expenses | (433,447) | (470,484) | (417,915) | ||||||||
Lease expense | (254) | ||||||||||
Interest expense | (290) | (498) | |||||||||
Investment income | 290 | 498 | |||||||||
Equity in net (income) loss of unconsolidated affiliates | 2,166 | 1,792 | 1,700 | ||||||||
(Loss) income before income tax benefit | (2,166) | (1,790) | (1,699) | ||||||||
(Loss) income from continuing operations | (2,166) | (1,790) | (1,699) | ||||||||
Elimination | Inpatient Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | (1,406) | (1,800) | (2,089) | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ 394 | $ 289 | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | (21.90%) | (13.80%) | |||||||||
Elimination | Rehabilitation therapy service | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ (408,687) | $ (429,828) | $ (385,721) | ||||||||
Concentration Risk, Percentage | (7.10%) | (7.60%) | (8.10%) | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ 21,141 | $ (44,107) | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | (4.90%) | 11.40% | |||||||||
Elimination | Other Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenues | $ (23,354) | $ (39,108) | $ (30,104) | ||||||||
Concentration Risk, Percentage | (0.40%) | (0.70%) | (0.60%) | ||||||||
Increase (Decrease) in Net Revenue From Prior Period | $ 15,754 | $ (9,004) | |||||||||
Increase (Decrease) in Net Revenue as Percent of Prior Period Revenue | (40.30%) | 29.90% |
Segment Information - Assets by
Segment Information - Assets by Segment (Details) - USD ($) $ in Thousands | May 01, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Segment Reporting, Asset Reconciling Item | ||||
Segment total assets | $ 5,779,201 | $ 6,059,949 | ||
Goodwill included in total assets | 440,712 | 470,019 | $ 169,681 | |
Corporate and Eliminations | ||||
Segment Reporting, Asset Reconciling Item | ||||
Segment total assets | 62,319 | 87,687 | ||
Inpatient Services | ||||
Segment Reporting, Asset Reconciling Item | ||||
Segment total assets | 5,194,811 | 5,437,518 | ||
Goodwill included in total assets | 355,070 | 357,649 | ||
Rehabilitation therapy service | ||||
Segment Reporting, Asset Reconciling Item | ||||
Segment total assets | 454,723 | 442,969 | ||
Goodwill included in total assets | 73,814 | 73,098 | ||
Other Services | ||||
Segment Reporting, Asset Reconciling Item | ||||
Segment total assets | 67,348 | 91,775 | ||
Goodwill included in total assets | $ 11,828 | $ 39,272 | ||
Hospice And Home Health Operations | Disposed by sale | ||||
Segment Reporting, Asset Reconciling Item | ||||
Derecognized goodwill | $ 27,400 |
Restricted Cash and Investmen60
Restricted Cash and Investments in Marketable Securities - Components (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | $ 155,961 | $ 198,082 |
Unrealized gains | 776 | 846 |
Unrealized losses, less than 12 months | (119) | (314) |
Unrealized losses, greater than 12 months | (592) | (487) |
Fair value | 156,026 | 198,127 |
Less: Current portion of restricted investments | 43,555 | 52,917 |
Long-term restricted investments | 112,471 | 145,210 |
Mortgage/Government Backed Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 16,947 | 13,251 |
Unrealized gains | 9 | |
Unrealized losses, less than 12 months | (16) | |
Unrealized losses, greater than 12 months | (96) | (49) |
Fair value | 16,844 | 13,202 |
Corporate Bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 65,563 | 82,912 |
Unrealized gains | 68 | 138 |
Unrealized losses, less than 12 months | (43) | (117) |
Unrealized losses, greater than 12 months | (283) | (350) |
Fair value | 65,305 | 82,583 |
Government Bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 61,399 | 67,549 |
Unrealized gains | 699 | 708 |
Unrealized losses, less than 12 months | (60) | (197) |
Unrealized losses, greater than 12 months | (213) | (88) |
Fair value | 61,825 | 67,972 |
Cash [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 11,515 | 33,698 |
Fair value | 11,515 | 33,698 |
Money Market Funds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 537 | 672 |
Fair value | $ 537 | $ 672 |
Restricted Cash and Investmen61
Restricted Cash and Investments in Marketable Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Proceeds from maturities of restricted investments | $ 38,600 | $ 26,200 | $ 22,900 |
Proceeds from sales of investments | 34,100 | 15,100 | 7,300 |
Gross realized gain | 500 | 100 | 800 |
Gross realized loss | (900) | $ (800) | $ (300) |
Letters of credit issued | 392,850 | ||
Restricted cash pledged as security | 9,400 | ||
Restricted investments pledged as security, amortized cost | 143,800 | ||
Market value of restricted investments pledged as security | 142,900 | ||
Letter of Credit [Member] | |||
Letters of credit issued | $ 123,200 |
Restricted Cash and Investmen62
Restricted Cash and Investments in Marketable Securities - Maturities (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Restricted Cash and Investments in Marketable Securities [Abstract] | |
Amortized cost, Due in one year or less | $ 49,230 |
Amortized cost, Due after 1 year through 5 years | 88,531 |
Amortized cost, Due after 5 years through 10 years | 6,148 |
Total amortized cost | 143,909 |
Fair value, Due in one year or less | 49,208 |
Fair value, Due after 1 year through 5 years | 88,645 |
Fair value, Due after 5 year through 10 years | 6,121 |
Total fair value | $ 143,974 |
Property and Equipment (Details
Property and Equipment (Details) $ in Thousands | Dec. 22, 2016facility | Nov. 01, 2016facility | Oct. 23, 2016facility | Oct. 18, 2016facility | Dec. 31, 2016USD ($)facility | Dec. 31, 2016USD ($)facility | Dec. 31, 2015USD ($) |
Property, Plant and Equipment [Line Items] | |||||||
Gross property and equipment | $ 4,573,169 | $ 4,573,169 | $ 4,724,015 | ||||
Less accumulated depreciation | (807,776) | (807,776) | (638,768) | ||||
Net property and equipment | $ 3,765,393 | 3,765,393 | 4,085,247 | ||||
Tangible Asset Impairment Charges | $ 32,100 | 26,800 | |||||
Number of facilities classified as held for sale | facility | 16 | 16 | 16 | ||||
Number of facilities under lease | facility | 28 | 64 | |||||
Land, Buildings and Improvements | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Gross property and equipment | $ 673,092 | $ 673,092 | 714,766 | ||||
Amount reclassified from property and equipment to assets held for sale | 70,800 | ||||||
Capital lease land, buildings and improvements | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Gross property and equipment | 818,273 | 818,273 | 903,977 | ||||
Financing obligation land, buildings and improvements | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Gross property and equipment | 2,584,178 | 2,584,178 | 2,644,307 | ||||
Equipment, furniture and fixtures | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Gross property and equipment | 447,767 | 447,767 | 436,300 | ||||
Amount reclassified from property and equipment to assets held for sale | 16,500 | ||||||
Construction in progress | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Gross property and equipment | $ 49,859 | $ 49,859 | $ 24,665 | ||||
Nonstrategic Facilities And Investments [Member] | Disposed by sale | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Number of facilities sold | facility | 18 | 9 | 18 | ||||
Number of owned facilities | facility | 16 | 16 | |||||
Number of facilities under lease | facility | 2 | 2 |
Goodwill and Identifiable Int64
Goodwill and Identifiable Intangible Assets - Changes in Carrying Value of Goodwill (Details) - USD ($) $ in Thousands | May 01, 2016 | Dec. 31, 2016 | Dec. 31, 2015 |
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | $ 470,019 | $ 169,681 | |
Goodwill associated with assets held for sale | (5,933) | ||
Other goodwill additions | 716 | 836 | |
Goodwill, Ending Balance | 440,712 | 470,019 | |
Accumulated amortization of goodwill | 0 | ||
Skilled Combination | |||
Goodwill [Line Items] | |||
Goodwill acquired | 267,050 | ||
Revera Acquisition | |||
Goodwill [Line Items] | |||
Goodwill acquired | 3,354 | $ 32,452 | |
Disposed by sale | Hospice And Home Health Operations | |||
Goodwill [Line Items] | |||
Sale of hospice and home health | $ (27,400) | ||
Disposed by sale | Hospice And Home Health Operations | Revera Acquisition | |||
Goodwill [Line Items] | |||
Sale of hospice and home health | $ (27,444) |
Goodwill and Identifiable Int65
Goodwill and Identifiable Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Finite and Indefinite-Lived Intangible Assets [Line Items] | ||
Identifiable intangible assets | $ 175,566 | $ 209,967 |
Accumulated amortization on intangible assets | 91,155 | 66,570 |
Trade names | ||
Schedule of Finite and Indefinite-Lived Intangible Assets [Line Items] | ||
Trade names | 50,556 | 53,956 |
Customer relationships | ||
Schedule of Finite and Indefinite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets | 67,348 | 78,493 |
Accumulated amortization on intangible assets | $ 43,862 | $ 34,336 |
Weighted Average Remaining Life | 9 years | 10 years |
Management contracts | ||
Schedule of Finite and Indefinite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets | $ 14,651 | $ 22,807 |
Accumulated amortization on intangible assets | $ 17,872 | $ 8,093 |
Weighted Average Remaining Life | 2 years | 3 years |
Favorable lease contracts | ||
Schedule of Finite and Indefinite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets | $ 43,011 | $ 54,711 |
Accumulated amortization on intangible assets | $ 29,421 | $ 24,141 |
Weighted Average Remaining Life | 10 years | 10 years |
Goodwill and Identifiable Int66
Goodwill and Identifiable Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity | |||
2,016 | $ 26.4 | ||
2,017 | 22.3 | ||
2,018 | 16.8 | ||
2,019 | 11.4 | ||
2,020 | 10.5 | ||
Thereafter | 37.5 | ||
Customer relationships | |||
Finite-Lived Intangible Assets | |||
Amortization expense | 10.3 | $ 10.3 | $ 9.1 |
Management contracts | |||
Finite-Lived Intangible Assets | |||
Amortization expense | 9 | 8.1 | 0 |
Favorable lease contracts | |||
Finite-Lived Intangible Assets | |||
Amortization expense | 8.1 | 8.4 | 9.3 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity | |||
Impairment of intangible assets, finite-lived | $ 3.3 | $ 1.8 | $ 3 |
Long-Term Debt - (Details)
Long-Term Debt - (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Long-term debt | ||
Total long-term debt | $ 1,171,144 | $ 1,198,636 |
Current installments of long-term debt | (24,594) | (12,477) |
Long-term debt | 1,146,550 | 1,186,159 |
Term Loan Facility | ||
Long-term debt | ||
Total long-term debt | 210,842 | |
Original issue discount | 7,475 | |
Debt issuance costs | 10,129 | |
New term loan agreement | ||
Long-term debt | ||
Total long-term debt | 116,174 | |
Debt issuance costs | 3,859 | |
Real estate bridge loan | ||
Long-term debt | ||
Total long-term debt | 313,549 | 484,533 |
Debt issuance costs | 4,400 | 9,567 |
HUD insured loans | ||
Long-term debt | ||
Total long-term debt | 241,570 | 106,250 |
Debt issuance costs | 4,773 | 1,395 |
Welltower Notes | ||
Long-term debt | ||
Total long-term debt | 73,829 | |
Original issue discount | 990 | |
Mortgages and other secured debt (recourse) | ||
Long-term debt | ||
Total long-term debt | 13,235 | 13,934 |
Mortgages and other secured debt (non-recourse) | ||
Long-term debt | ||
Total long-term debt | 29,157 | 30,331 |
Debt issuance costs | 131 | 176 |
Revolving Credit Facility | ||
Long-term debt | ||
Total long-term debt | 383,630 | 352,746 |
Original issue discount | $ 9,220 | $ 10,254 |
Long-Term Debt - Revolving Cred
Long-Term Debt - Revolving Credit Facilities (Details) $ in Thousands | Jan. 01, 2020 | Jun. 30, 2016 | Feb. 02, 2015USD ($)item | Mar. 31, 2017 | Dec. 31, 2016USD ($) |
Long-term debt | |||||
Revolving credit facility | $ 392,850 | ||||
Total borrowing base capacity | $ 543,750 | ||||
Weighted Average Interest Rate | 4.72% | ||||
Tranche A-1 | |||||
Long-term debt | |||||
Revolving credit facility | $ 305,000 | ||||
Total borrowing base capacity | $ 440,000 | ||||
Weighted Average Interest Rate | 4.76% | ||||
Tranche A-1 | LIBOR | Minimum | |||||
Long-term debt | |||||
Basis spread on variable rate | 2.75% | ||||
Tranche A-1 | LIBOR | Maximum | |||||
Long-term debt | |||||
Basis spread on variable rate | 3.25% | ||||
Tranche A-2 | |||||
Long-term debt | |||||
Revolving credit facility | $ 43,300 | ||||
Total borrowing base capacity | $ 50,000 | ||||
Weighted Average Interest Rate | 4.19% | ||||
Tranche A-2 | LIBOR | Minimum | |||||
Long-term debt | |||||
Basis spread on variable rate | 2.50% | ||||
Tranche A-2 | LIBOR | Maximum | |||||
Long-term debt | |||||
Basis spread on variable rate | 3.00% | ||||
FILO Tranche | |||||
Long-term debt | |||||
Revolving credit facility | $ 18,750 | ||||
Total borrowing base capacity | $ 18,750 | ||||
Weighted Average Interest Rate | 6.77% | ||||
FILO Tranche | LIBOR | |||||
Long-term debt | |||||
Basis spread on variable rate | 5.00% | ||||
HUD Tranche | |||||
Long-term debt | |||||
Revolving credit facility | $ 25,800 | ||||
Total borrowing base capacity | $ 35,000 | ||||
Weighted Average Interest Rate | 3.57% | ||||
HUD Tranche | LIBOR | Minimum | |||||
Long-term debt | |||||
Basis spread on variable rate | 2.50% | ||||
HUD Tranche | LIBOR | Maximum | |||||
Long-term debt | |||||
Basis spread on variable rate | 3.00% | ||||
Revolving Credit Facility | |||||
Long-term debt | |||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 550,000 | ||||
Debt Instrument Number of Tranches | item | 4 | ||||
Revolving credit facility | $ 392,900 | ||||
Outstanding Letters of Credit | 59,200 | ||||
Available borrowing capacity under the revolving credit facilities | $ 69,500 | ||||
Revolving Credit Facility | Minimum | |||||
Long-term debt | |||||
Commitment fee rate (as percentage) | 0.375% | ||||
Revolving Credit Facility | Maximum | |||||
Long-term debt | |||||
Commitment fee rate (as percentage) | 0.50% | ||||
Revolving Credit Facility | Federal Funds | |||||
Long-term debt | |||||
Basis spread on variable rate | 3.00% | ||||
Revolving Credit Facility | Tranche A-1 | Base Rate | Minimum | |||||
Long-term debt | |||||
Basis spread on variable rate | 1.75% | ||||
Revolving Credit Facility | Tranche A-1 | Base Rate | Maximum | |||||
Long-term debt | |||||
Basis spread on variable rate | 2.25% | ||||
Revolving Credit Facility | Tranche A-2 | Base Rate | Minimum | |||||
Long-term debt | |||||
Basis spread on variable rate | 1.50% | ||||
Revolving Credit Facility | Tranche A-2 | Base Rate | Maximum | |||||
Long-term debt | |||||
Basis spread on variable rate | 2.00% | ||||
Revolving Credit Facility | FILO Tranche | Base Rate | |||||
Long-term debt | |||||
Basis spread on variable rate | 4.00% | ||||
Revolving Credit Facility | HUD Tranche | Base Rate | Minimum | |||||
Long-term debt | |||||
Basis spread on variable rate | 1.50% | ||||
Revolving Credit Facility | HUD Tranche | Base Rate | Maximum | |||||
Long-term debt | |||||
Basis spread on variable rate | 2.00% | ||||
Revolving Credit Facility Amendment | |||||
Long-term debt | |||||
Total borrowing base capacity | $ 521,600 | ||||
Revolving Credit Facility Amendment | Forecast | Minimum | |||||
Long-term debt | |||||
Leverage ratio | 4.00% | ||||
Revolving Credit Facility Amendment | Forecast | Maximum | |||||
Long-term debt | |||||
Leverage ratio | 6.00% | ||||
Revolving Credit Facility Amendment | Tranche A-1 | Base Rate | Minimum | |||||
Long-term debt | |||||
Basis spread on variable rate | 2.00% | ||||
Revolving Credit Facility Amendment | Tranche A-1 | Base Rate | Maximum | |||||
Long-term debt | |||||
Basis spread on variable rate | 2.50% | ||||
Revolving Credit Facility Amendment | Tranche A-1 | LIBOR | Minimum | |||||
Long-term debt | |||||
Basis spread on variable rate | 3.00% | ||||
Revolving Credit Facility Amendment | Tranche A-1 | LIBOR | Maximum | |||||
Long-term debt | |||||
Basis spread on variable rate | 3.50% | ||||
Revolving Credit Facility Amendment | Tranche A-2 | Base Rate | Minimum | |||||
Long-term debt | |||||
Basis spread on variable rate | 2.00% | ||||
Revolving Credit Facility Amendment | Tranche A-2 | Base Rate | Maximum | |||||
Long-term debt | |||||
Basis spread on variable rate | 2.50% | ||||
Revolving Credit Facility Amendment | Tranche A-2 | LIBOR | Minimum | |||||
Long-term debt | |||||
Basis spread on variable rate | 3.00% | ||||
Revolving Credit Facility Amendment | Tranche A-2 | LIBOR | Maximum | |||||
Long-term debt | |||||
Basis spread on variable rate | 3.50% | ||||
Revolving Credit Facility Amendment | FILO Tranche | Base Rate | |||||
Long-term debt | |||||
Basis spread on variable rate | 5.00% | ||||
Revolving Credit Facility Amendment | FILO Tranche | LIBOR | |||||
Long-term debt | |||||
Basis spread on variable rate | 6.00% |
Long-Term Debt - Term Loan Faci
Long-Term Debt - Term Loan Facility and New Term Loan Agreement (Details) - USD ($) $ in Millions | Jan. 01, 2020 | Jul. 29, 2016 | Mar. 31, 2017 | Dec. 31, 2016 |
Term Loan Facility | ||||
Term Loan Facility and New Term Loan Agreement | ||||
Term of debt | 5 years | |||
Amount of outstanding balance under Term Loan Facility paid | $ 153.4 | |||
Early termination fee | $ 3.1 | |||
Term Loan Facility | Base Rate | ||||
Term Loan Facility and New Term Loan Agreement | ||||
Debt Instrument Variable Interest Rate Floor | 2.50% | |||
Floor rate (as a percent) | 2.50% | |||
Term Loan Facility | LIBOR | ||||
Term Loan Facility and New Term Loan Agreement | ||||
Basis spread on variable rate | 1.00% | |||
Debt Instrument Variable Interest Rate Floor | 1.50% | |||
Floor rate (as a percent) | 1.50% | |||
Term Loan Facility | Federal Funds | ||||
Term Loan Facility and New Term Loan Agreement | ||||
Basis spread on variable rate | 0.50% | |||
New Term Loan Facility | Minimum | Forecast | ||||
Term Loan Facility and New Term Loan Agreement | ||||
Leverage ratio | 4.00% | |||
New Term Loan Facility | Maximum | Forecast | ||||
Term Loan Facility and New Term Loan Agreement | ||||
Leverage ratio | 6.00% | |||
Affiliate Of Welltower Inc And Affiliate Of Omega Healthcare Investors Inc | New Term Loan Facility | ||||
Term Loan Facility and New Term Loan Agreement | ||||
Term of debt | 4 years | |||
Effective interest rate | 14.00% | |||
Paid-in-kind interest rate | 2.00% | |||
Aggregate principal amount | $ 120 | $ 120 | ||
Debt Instrument Annual Amortization Rate In Years One, Two and Three As Percent | 2.50% | |||
Annual amortization in years four, percent | 5.00% | |||
Affiliate Of Welltower Inc And Affiliate Of Omega Healthcare Investors Inc | New Term Loan Facility | Maximum | ||||
Term Loan Facility and New Term Loan Agreement | ||||
Interest paid in cash or paid-in-kind (as a percent) | 2.00% | |||
Affiliate Of Welltower Inc And Affiliate Of Omega Healthcare Investors Inc | New Term Loan Facility | LIBOR | ||||
Term Loan Facility and New Term Loan Agreement | ||||
Basis spread on variable rate | 13.00% | |||
Debt Instrument Variable Interest Rate Floor | 1.00% | |||
Floor rate (as a percent) | 1.00% | |||
Affiliate Of Welltower Inc And Affiliate Of Omega Healthcare Investors Inc | New Term Loan Facility | Available Bit Rate | ||||
Term Loan Facility and New Term Loan Agreement | ||||
Basis spread on variable rate | 12.00% | |||
Debt Instrument Variable Interest Rate Floor | 2.00% | |||
Floor rate (as a percent) | 2.00% |
Long-Term Debt - Real Estate Br
Long-Term Debt - Real Estate Bridge Loans (Details) | Dec. 22, 2016USD ($)loan | Oct. 01, 2016facility | Sep. 01, 2016USD ($)facility | May 23, 2016USD ($)facility | Apr. 01, 2016USD ($)facility | Dec. 01, 2015USD ($)facilityitem | Feb. 02, 2015USD ($)item | Dec. 31, 2016USD ($)facilityitem | Oct. 23, 2016facility |
Long-term debt | |||||||||
Number of facilities classified as held for sale | 16 | 16 | |||||||
Disposal Group, Held-for-sale, Not Discontinued Operations | |||||||||
Long-term debt | |||||||||
Number of facilities classified as held for sale | 16 | ||||||||
Skilled Real Estate Bridge Loan And Revera Real Estate Bridge Loan (Member) | |||||||||
Long-term debt | |||||||||
Total amount of combined outstanding bridge loan debt | $ | $ 317,000,000 | ||||||||
Number of bridge loans combined and refinanced | loan | 2 | ||||||||
Skilled Real Estate Bridge Loan | |||||||||
Long-term debt | |||||||||
Aggregate principal amount | $ | $ 360,000,000 | ||||||||
Term of debt | 24 months | ||||||||
Debt instrument number of term extensions | item | 2 | ||||||||
Debt instrument term extension period (in days) | 90 days | ||||||||
Skilled Real Estate Bridge Loan | LIBOR | |||||||||
Long-term debt | |||||||||
Basis spread on variable rate | 6.75% | ||||||||
Debt Instrument Variable Interest Rate Floor | 0.50% | ||||||||
Skilled Real Estate Bridge Loan | LIBOR | Maximum | |||||||||
Long-term debt | |||||||||
Debt instrument additional margin based on days outstanding | 7.50% | ||||||||
Revera Real Estate Bridge Loan | |||||||||
Long-term debt | |||||||||
Aggregate principal amount | $ | $ 134,100,000 | ||||||||
Number of facilities pledged | 20 | ||||||||
Term of debt | 24 months | ||||||||
Debt instrument number of term extensions | item | 2 | ||||||||
Debt instrument term extension period (in days) | 90 days | ||||||||
Debt Instrument Threshold for Ratio | 75.00% | ||||||||
Debt Instrument Additive to Threshold for Ratio | 5.00% | ||||||||
Revera Real Estate Bridge Loan | LIBOR | |||||||||
Long-term debt | |||||||||
Debt instrument additional margin based on ratio | 0.25% | ||||||||
Basis spread on variable rate | 6.75% | ||||||||
Debt Instrument Variable Interest Rate Floor | 0.50% | ||||||||
Revera Real Estate Bridge Loan | LIBOR | Maximum | |||||||||
Long-term debt | |||||||||
Debt instrument additional margin based on days outstanding | 7.00% | ||||||||
Welltower Bridge Loans | |||||||||
Long-term debt | |||||||||
Number of facilities pledged | 45 | ||||||||
Principal balance outstanding | $ | $ 317,000,000 | ||||||||
Number of separate bridge loan agreements | loan | 4 | ||||||||
Fixed interest rate | 10.00% | ||||||||
Annual rate of increase to fixed interest rate | 0.25% | ||||||||
Number of facilities whose operators have receivables secured under second lien | 27 | ||||||||
Welltower Bridge Loans | Disposal Group, Held-for-sale, Not Discontinued Operations | |||||||||
Long-term debt | |||||||||
Aggregate principal amount | $ | $ 9,000,000 | ||||||||
Number of bridge loans classified as held for sale | item | 1 | ||||||||
Number of facilities classified as held for sale | 3 | ||||||||
Other Real Estate Bridge Loans | |||||||||
Long-term debt | |||||||||
Aggregate principal amount | $ | $ 44,000,000 | $ 9,900,000 | |||||||
Term of debt | 3 years | ||||||||
Effective interest rate | 4.77% | ||||||||
Principal balance outstanding | $ | $ 9,900,000 | ||||||||
Skilled nursing facilities acquired | 5 | 1 | |||||||
Other Real Estate Bridge Loans | LIBOR | |||||||||
Long-term debt | |||||||||
Basis spread on variable rate | 4.00% | ||||||||
Revera Acquisition | |||||||||
Long-term debt | |||||||||
Number of facilities acquired | 5 | 19 | |||||||
Revera Acquisition | Revera Real Estate Bridge Loan | |||||||||
Long-term debt | |||||||||
Skilled nursing facilities acquired | 5 | ||||||||
Loan | $ | $ 37,000,000 |
Long-Term Debt - HUD Insured Lo
Long-Term Debt - HUD Insured Loans (Details) $ in Millions | Feb. 02, 2015facilityitem | Dec. 31, 2016USD ($)facilityloan | Oct. 23, 2016facility | May 01, 2015USD ($) |
Long-term debt | ||||
Number of facilities classified as held for sale | facility | 16 | 16 | ||
Weighted Average Interest Rate | 4.72% | |||
HUD insured loans | ||||
Long-term debt | ||||
Number of debt instruments insured by HUD | 10 | 39 | ||
Number of facilities pledged | facility | 10 | |||
Loan assumed from acquisition | $ 8.4 | |||
Principal balance outstanding | $ 309.7 | |||
Debt premium | $ 14.1 | |||
Debt instrument average remaining term (in years) | 31 years | |||
Weighted Average Interest Rate | 3.50% | |||
Debt instrument period in which prepayment is not allowed (in months) | 12 months | |||
Prepayment penalty (as a percentage) | 10.00% | |||
Decrease in prepayment penalty (as a percentage) | 1.00% | |||
HUD insured loans | Minimum | ||||
Long-term debt | ||||
Term of debt | 30 years | |||
Fixed interest rate | 3.00% | |||
HUD insured loans | Maximum | ||||
Long-term debt | ||||
Term of debt | 35 years | |||
Fixed interest rate | 4.60% | |||
Prepaid Expenses and Other Current Assets [Member] | HUD insured loans | ||||
Long-term debt | ||||
Escrow reserve funds | $ 21.7 | |||
Disposal Group, Held-for-sale, Not Discontinued Operations | ||||
Long-term debt | ||||
Number of facilities classified as held for sale | facility | 16 | |||
Disposal Group, Held-for-sale, Not Discontinued Operations | HUD insured loans | ||||
Long-term debt | ||||
Number of facilities classified as held for sale | facility | 13 | |||
Principal balance outstanding | $ 63.4 |
Long-Term Debt - Notes Payable
Long-Term Debt - Notes Payable (Details) item in Millions, $ in Millions | Dec. 23, 2016USD ($)facilityitemloan | Nov. 01, 2016USD ($)facility | Dec. 31, 2016USD ($) |
Welltower Inc | |||
Long-term debt | |||
Number Of Facilities Sold | facility | 28 | 64 | |
Welltower Notes | |||
Long-term debt | |||
Cash interest rate | 3.00% | ||
Paid-in-kind interest rate | 7.00% | ||
Principal balance outstanding | $ 51.2 | ||
Note Payable Due October 30, 2020 | |||
Long-term debt | |||
Notes Issued | $ 51.2 | ||
Welltower Notes Due December 2021 [Member] | |||
Long-term debt | |||
Number of notes issued | loan | 2 | ||
Debt Instrument, Face Amount | $ 23.7 | ||
Note Payable Due December 15 2021 | |||
Long-term debt | |||
Cash interest rate | 3.00% | ||
Paid-in-kind interest rate | 7.00% | ||
Debt Instrument, Face Amount | $ 11.7 | ||
Principal balance outstanding | 11.7 | ||
Convertible Note Payable Due December 15 2021 | |||
Long-term debt | |||
Cash interest rate | 3.00% | ||
Paid-in-kind interest rate | 3.00% | ||
Debt Instrument, Face Amount | $ 12 | ||
Principal balance outstanding | $ 12 | ||
Number of shares into which the debt instrument may be converted | item | 3 |
Long-Term Debt - Other (Details
Long-Term Debt - Other (Details) | Dec. 31, 2016 |
Long-term debt | |
Weighted Average Interest Rate | 4.72% |
Minimum | Mortgages and other secured debt (recourse) | |
Long-term debt | |
Effective interest rate | 2.50% |
Minimum | Mortgages and other secured debt (non-recourse) | |
Long-term debt | |
Effective interest rate | 2.50% |
Maximum | Mortgages and other secured debt (recourse) | |
Long-term debt | |
Effective interest rate | 6.00% |
Maximum | Mortgages and other secured debt (non-recourse) | |
Long-term debt | |
Effective interest rate | 22.20% |
Long-Term Debt - Debt Covenants
Long-Term Debt - Debt Covenants (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Long-term Debt, Fiscal Year Maturity [Abstract] | |
2,017 | $ 26,353 |
2,018 | 28,843 |
2,019 | 18,990 |
2,020 | 550,023 |
2,021 | 30,541 |
Thereafter | 596,358 |
Total debt maturity | $ 1,251,108 |
Lease and Lease Commitments - F
Lease and Lease Commitments - Future minimum payment tables (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2,017 | $ 93,174 | |
2,018 | 90,500 | |
2,019 | 92,346 | |
2,020 | 94,546 | |
2,021 | 96,527 | |
Thereafter | 3,086,964 | |
Total future minimum lease payments | 3,554,057 | |
Less amount representing interest | (2,554,831) | |
Capital lease obligation | 999,226 | |
Less current portion | (1,886) | $ (1,842) |
Capital lease obligations | 997,340 | $ 1,053,816 |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2,017 | 138,324 | |
2,018 | 137,096 | |
2,019 | 134,421 | |
2,020 | 135,223 | |
2,021 | 130,055 | |
Thereafter | 340,979 | |
Total future minimum lease payments | $ 1,016,098 |
Lease and Lease Commitments - C
Lease and Lease Commitments - Capital Lease Rates and Deferred Balances (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2016USD ($)leasefacility | Dec. 31, 2015USD ($) | |
Number of leases with unmet financial covenants | lease | 3 | |
Number of facilities under leases with unmet financial covenants | facility | 26 | |
Identifiable Intangible Assets [Member] | ||
Net favorable leases | $ 43 | $ 54.7 |
Other Noncurrent Liabilities [Member] | ||
Net unfavorable leases | 28.8 | 35.5 |
Deferred straight-line rent balances included in other long-term liabilities | $ 31.6 | $ 27.3 |
Maximum | ||
Capital lease imputed interest rate (as a percent) | 12.80% | |
Minimum | ||
Capital lease imputed interest rate (as a percent) | 3.50% |
Financing Obligation (Details)
Financing Obligation (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)lease | Dec. 31, 2015USD ($) | |
Present Value of Future Minimum Lease Payments, Sale Leaseback Transactions, Rolling Maturity | ||
Total future minimum lease payments | $ 9,495,225 | |
Less amount representing interest | (6,626,078) | |
Financing obligation | 2,869,147 | |
Less current portion | (1,613) | $ (989) |
Long-term financing obligation | $ 2,867,534 | $ 3,064,077 |
Number of new master lease agreement | lease | 2 | |
Reduction in financing obligations | $ 208,900 | |
Present Value of Future Minimum Lease Payments, Sale Leaseback Transactions, Fiscal Year Maturity | ||
2,017 | 270,566 | |
2,018 | 274,797 | |
2,019 | 280,942 | |
2,020 | 287,610 | |
2,021 | 292,886 | |
Thereafter | $ 8,088,424 | |
Minimum | ||
Sale Leaseback Transaction [Line Items] | ||
Financing obligation, imputed interest rate (as a percent) | 1.20% | |
Maximum | ||
Sale Leaseback Transaction [Line Items] | ||
Financing obligation, imputed interest rate (as a percent) | 27.80% |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Class of Stock | |||
Maximum number of shares from all classes combined, authorized | 1,200,000,000 | ||
Preferred stock, authorized (in shares) | 30,000,000 | 30,000,000 | |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Preferred stock, issued (in shares) | 0 | 0 | |
Distributions to stockholders and NCI | $ 0.2 | $ 7 | $ 18 |
Class A Common Stock | |||
Class of Stock | |||
Common stock, authorized (in shares) | 1,000,000,000 | 1,000,000,000 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Common stock, issued (in shares) | 75,187,388 | 73,593,732 | |
Class B Common Stock | |||
Class of Stock | |||
Common stock, authorized (in shares) | 20,000,000 | 20,000,000 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Common stock, issued (in shares) | 15,495,019 | 15,511,603 | |
Class C Common Stock | |||
Class of Stock | |||
Common stock, authorized (in shares) | 150,000,000 | 150,000,000 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Common stock, issued (in shares) | 63,849,380 | 64,449,380 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Monte-Carlo fair value assumptions | ||
Expected term (in years) | 1 year 2 months 12 days | |
Risk-free interest rate (as a percent) | 1.00% | |
Volatility, minimum (as a percent) | 45.00% | |
Volatility, maximum (as a percent) | 55.00% | |
2015 Omnibus Equity Incentive Plan | ||
Monte-Carlo fair value assumptions | ||
Expected term (in years) | 1 year 7 months 6 days | |
Risk-free interest rate (as a percent) | 1.00% | |
Volatility, minimum (as a percent) | 60.00% | |
Restricted Stock Units (RSUs) | 2015 Omnibus Equity Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Award vesting period | 3 years | |
Restricted Stock Units (RSUs) | 2015 Omnibus Equity Incentive Plan | Class A Common Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Number of shares per RSU | 1 |
Stock-Based Compensation - Nonv
Stock-Based Compensation - Nonvested Units Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
RSUs and PSUs | General and Administrative Expense | ||
Weighted-Average Grant Date Fair Value | ||
Compensation expense | $ 8.4 | $ 4.7 |
2015 Omnibus Equity Incentive Plan | ||
Weighted-Average Grant Date Fair Value | ||
Unrecognized compensation costs | $ 17.5 | $ 19.4 |
Remaining award vesting period | 1 year 8 months 19 days | 2 years 4 months 28 days |
Fair value of shares vested | $ 2.2 | |
2015 Omnibus Equity Incentive Plan | Maximum | ||
Weighted-Average Grant Date Fair Value | ||
Fair value of shares vested | $ 0.1 | |
2015 Omnibus Equity Incentive Plan | Restricted Stock Units (RSUs) | ||
Number of Shares | ||
Non-vested beginning balance | 3,043 | |
Granted | 2,975 | 3,196 |
Vested | (1,074) | (2) |
Forfeited | (325) | (151) |
Non-vested ending balance | 4,619 | 3,043 |
Weighted-Average Grant Date Fair Value | ||
Non-vested beginning balance | $ 6.01 | |
Granted | 1.67 | $ 6.01 |
Vested | 6.03 | 6.12 |
Forfeited | 5.47 | 6.04 |
Non-vested ending balance | $ 3.25 | $ 6.01 |
2015 Omnibus Equity Incentive Plan | Performance Shares | ||
Number of Shares | ||
Non-vested beginning balance | 1,702 | |
Granted | 2,249 | 1,752 |
Forfeited | (245) | (50) |
Non-vested ending balance | 3,706 | 1,702 |
Weighted-Average Grant Date Fair Value | ||
Non-vested beginning balance | $ 3.34 | |
Granted | 0.81 | $ 3.34 |
Forfeited | 2.82 | 3.31 |
Non-vested ending balance | $ 1.84 | $ 3.34 |
Class A Common Stock | 2015 Omnibus Equity Incentive Plan | ||
Weighted-Average Grant Date Fair Value | ||
Shares available for grant (in shares) | 11,800 | 16,500 |
Income Taxes - Total Tax Provis
Income Taxes - Total Tax Provision (Details) $ in Thousands | Feb. 02, 2015item | Jan. 31, 2015item | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($)item |
Number of Taxable Groups | item | 2 | 2 | 2 | ||
Continuing operations | $ (17,435) | $ 172,524 | $ (44,022) | ||
Discontinued operations | 8 | (885) | (4,440) | ||
Noncontrolling interests | (331) | ||||
Members' equity | (82) | (212) | (368) | ||
Total | $ (17,509) | $ 171,427 | $ (49,161) | ||
FC-GEN Operations Investment, LLC | |||||
Percentage of voting interests acquired | 58.70% |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Current: Federal | $ (22,473) | $ 5,151 | $ 7,569 |
Current: State | (2,096) | 1,738 | 1,931 |
Total current | (24,569) | 6,889 | 9,500 |
Deferred: Federal | 5,785 | 134,151 | (47,050) |
Deferred: State | 1,349 | 31,484 | (6,472) |
Total deferred | 7,134 | 165,635 | (53,522) |
Income tax (benefit) expense | $ (17,435) | $ 172,524 | $ (44,022) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory income tax rate | 35.00% | 35.00% | 35.00% |
Income Tax Expense (Benefit), Continuing Operations, Income Tax Reconciliation | |||
Computed "expected" benefit | $ (47,430) | $ (123,560) | $ (98,527) |
State and local income taxes, net of federal tax benefit | (2,096) | 1,738 | 1,931 |
Adjustment to income taxes for income not subject to corporate tax | 34,196 | 64,575 | |
Income tax credits | (3,695) | (2,469) | (1,347) |
Non-controlling interest | 20,012 | 39,843 | |
Adjustment to deferred taxes, including credits and valuation allowance | 41,172 | 225,259 | (12,502) |
FIN 48 | (26,355) | 760 | 1,602 |
Other, net | 957 | (3,243) | 246 |
Income tax (benefit) expense | $ (17,435) | $ 172,524 | $ (44,022) |
Effective tax rate | 12.90% | (48.90%) | 15.60% |
Income Taxes - Deferred Income
Income Taxes - Deferred Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2016 | |
Components of Deferred Tax Assets and Liabilities | ||
Change in valuation allowance | $ 221,900 | |
Deferred income tax assets: | ||
Investment in partnerships | 131,767 | $ 160,610 |
Net operating loss carryforwards | 93,281 | 93,696 |
Discounted unpaid loss reserve | 7,143 | 6,107 |
Other intangible | 1,191 | |
General business credits | 20,017 | 25,066 |
Total deferred tax assets | 252,208 | 286,670 |
Valuation allowance | (245,064) | (280,563) |
Deferred tax assets, net of valuation allowance | 7,144 | 6,107 |
Deferred income tax liabilities: | ||
Long-lived assets: intangible property | (14,939) | (22,354) |
Total deferred tax liabilities | (14,939) | (22,354) |
Net deferred tax liabilities | $ (7,795) | $ (16,247) |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns | |||
Balance at December 31, | $ 24,292 | $ 24,233 | $ 24,209 |
Additions based upon tax positions related to the current year | 24 | ||
Additions recorded in purchase accounting | 59 | ||
Reductions due to lapses of applicable statute of limitations | (24,213) | ||
Balance at December 31, | $ 79 | 24,292 | 24,233 |
Accrued interest related to unrecognized tax benefits | $ 400 | $ 400 | |
Tax savings payable, as a percent | 90.00% | ||
Tax basis step-up in deductible goodwill of FC-GEN | $ 2,900 | ||
Maximum | |||
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns | |||
Accrued interest related to unrecognized tax benefits | $ 100 | ||
State | Minimum | |||
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns | |||
Number of Open Tax Years | 3 years | ||
State | Maximum | |||
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns | |||
Number of Open Tax Years | 6 years | ||
Class A Common Stock | |||
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns | |||
Number of Class A units exchanged | 0 | 0 |
Related Party Transactions (Det
Related Party Transactions (Details) $ in Thousands | May 01, 2016USD ($) | Jul. 01, 2015USD ($)building | Mar. 31, 2015USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Mar. 31, 2016 | Feb. 02, 2015USD ($) |
Related Party Transaction | ||||||||
Investment in joint venture | $ 536 | $ 392 | $ 2,309 | |||||
Ownership interest | 50.00% | |||||||
Proceeds from sale of joint venture interest | $ 6,460 | 26,358 | ||||||
Related party administrative services fees | 0 | 100 | 2,500 | |||||
Related party transaction advisory fee | $ 3,000 | |||||||
Disposed by sale | Hospice And Home Health Operations | ||||||||
Related Party Transaction | ||||||||
Cash proceeds | $ 72,000 | |||||||
Noncash consideration received in disposal | $ 12,000 | |||||||
Short-term Debt | 13,000 | |||||||
Rehabilitation Services | ||||||||
Related Party Transaction | ||||||||
Net revenue from related party | 155,400 | 161,400 | 161,200 | |||||
Net accounts receivable from related party | 83,900 | 57,100 | ||||||
National Home Care Holdings, LLC | ||||||||
Related Party Transaction | ||||||||
Investment in joint venture | $ 1,000 | |||||||
Ownership interest | 6.80% | |||||||
FC PAC | ||||||||
Related Party Transaction | ||||||||
Ownership interest | 5.40% | |||||||
Proceeds from sale of joint venture interest | $ 26,400 | |||||||
Gain on sale of joint venture | $ 8,400 | |||||||
FC PAC | Hospice And Diagnostic Services | ||||||||
Related Party Transaction | ||||||||
Amount of services in period | $ 12,200 | $ 12,000 | $ 7,900 | |||||
Formation Capital | ||||||||
Related Party Transaction | ||||||||
Number of facilities acquired | building | 22 | |||||||
Facilities purchase price | $ 1,100 | |||||||
Purchase price, financed with promissory note | $ 1,100 | |||||||
Interest rate | 5.00% | |||||||
Director | Disposed by sale | Hospice And Home Health Operations | ||||||||
Related Party Transaction | ||||||||
Aggregate ownership interest in counterparty indirectly held by certain board members, as a percent | 10.00% |
Defined Contribution Plan (Deta
Defined Contribution Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Compensation and Retirement Disclosure [Abstract] | ||
Defined contribution plan, employer discretionary contribution amount | $ 0 | $ 0 |
Other Income (Details)
Other Income (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 22, 2016 | Dec. 15, 2016 | Oct. 18, 2016 | May 01, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Gain on sale, disposal or divestiture of facilities | $ (134,100) | |||||||
Gain on sale of other owned assets, net | (220) | |||||||
Total other income | (207,070) | $ (1,400) | $ (138) | |||||
Nonstrategic Facilities And Investments [Member] | ||||||||
Gain on escrow receipt associated with terminated sale agreement | $ (5,000) | (5,000) | ||||||
Disposed by sale | Hospice And Home Health Operations | ||||||||
Gain on sale, disposal or divestiture of facilities | $ (43,400) | (43,420) | ||||||
Disposed by sale | Nonstrategic Facilities And Investments [Member] | ||||||||
Gain on sale, disposal or divestiture of facilities | $ (1,900) | $ (19,800) | ||||||
Gain on sale of investment in joint venture | $ (3,900) | (3,910) | ||||||
Disposed by sale | Leased Facilities Under New Lease Agreements [Member] | ||||||||
Gain on sale, disposal or divestiture of facilities | (134,090) | |||||||
Disposed by sale | Facilities Divested And Terminated From Lease Agreements [Member] | ||||||||
Gain on sale, disposal or divestiture of facilities | $ (20,430) |
Asset Impairment Charges (Detai
Asset Impairment Charges (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Asset Impairment Charges | ||||
Other Asset Impairment Charges | $ 35,431 | $ 28,546 | $ 31,399 | |
Goodwill, Impairment Loss | $ 0 | 0 | 0 | 0 |
Inpatient Services | ||||
Asset Impairment Charges | ||||
Other Asset Impairment Charges | $ 35,400 | $ 28,500 | $ 31,400 |
Assets Held for Sale and Disc90
Assets Held for Sale and Discontinued Operations (Details) $ in Thousands | Dec. 22, 2016facility | Nov. 01, 2016facility | Oct. 23, 2016USD ($)facility | Oct. 18, 2016USD ($)facility | Dec. 31, 2016USD ($)facility | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Sep. 30, 2014facilityitem | Dec. 31, 2016USD ($)facility | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2016USD ($)facilityitem |
Number of facilities classified as held for sale | facility | 16 | 16 | 16 | 16 | |||||||||||||
Number of facilities under lease | facility | 28 | 64 | |||||||||||||||
Net Revenues and Loss from Discontinued Operations | |||||||||||||||||
Income tax (expense) benefit | $ (8) | $ 885 | $ 4,440 | ||||||||||||||
Income (loss) from discontinued operations, net of taxes | $ 28 | $ (24) | $ 61 | $ (38) | $ 352 | $ 39 | $ (1,722) | $ 112 | $ 27 | (1,219) | (14,044) | ||||||
Number of operational closures categorized as discontinued operations | item | 0 | ||||||||||||||||
Disposal Group, Held-for-sale, Not Discontinued Operations | |||||||||||||||||
Number of facilities classified as held for sale | facility | 16 | 16 | 16 | ||||||||||||||
Assets and Liabilities of Disposal Group | |||||||||||||||||
Prepaid expenses | $ 4,056 | $ 4,056 | $ 4,056 | ||||||||||||||
Property and equipment, net of accumulated depreciation of $10,792 | 76,430 | 76,430 | 76,430 | ||||||||||||||
Accumulated depreciation | 10,792 | 10,792 | 10,792 | ||||||||||||||
Goodwill | 5,933 | 5,933 | 5,933 | ||||||||||||||
Total Assets | 86,419 | 86,419 | 86,419 | ||||||||||||||
Current installments of long-term debt | 988 | 988 | 988 | ||||||||||||||
Long-term debt | 69,057 | 69,057 | 69,057 | ||||||||||||||
Total Liabilities | $ 70,045 | 70,045 | $ 70,045 | ||||||||||||||
Discontinued Operations | |||||||||||||||||
Net Revenues and Loss from Discontinued Operations | |||||||||||||||||
Net revenues | 27 | 70 | 8,788 | ||||||||||||||
Net operating income (loss) of discontinued businesses | 35 | (2,104) | (16,559) | ||||||||||||||
Loss on discontinuation of business | (1,925) | ||||||||||||||||
Income tax (expense) benefit | (8) | 885 | 4,440 | ||||||||||||||
Income (loss) from discontinued operations, net of taxes | $ 27 | $ (1,219) | $ (14,044) | ||||||||||||||
Facilities Closed in 2014 [Member] | California And Massachusetts (Member) | Discontinued Operations | |||||||||||||||||
Net Revenues and Loss from Discontinued Operations | |||||||||||||||||
Number of facilities closed or had operations transferred | facility | 4 | ||||||||||||||||
Number of licensed beds | item | 440 | ||||||||||||||||
Nonstrategic Facilities And Investments [Member] | Disposed by sale | |||||||||||||||||
Number of facilities sold | facility | 18 | 9 | 18 | ||||||||||||||
Number of owned facilities | facility | 16 | 16 | |||||||||||||||
Number of facilities under lease | facility | 2 | 2 | |||||||||||||||
Assets and Liabilities of Disposal Group | |||||||||||||||||
Total Assets | $ 80,000 | ||||||||||||||||
Net Revenues and Loss from Discontinued Operations | |||||||||||||||||
Net revenues | $ 110,100 | $ 22,500 |
Commitments and Contingencies -
Commitments and Contingencies - Self Insurance Risks (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Workers' compensation approximate discount rate (as a percentage) | 1.00% | ||
Workers' Compensation discount rate (as a percentage) | 0.96% | ||
Potential effect of discounting on Workers Compensation reserve | $ 8.9 | $ 8.6 | |
Provision for general and professional liability | 137.5 | 151.1 | $ 130.8 |
Reserve for general and professional liability | 392.1 | 371.6 | |
Provision for workers' compensation | 60.7 | 60.7 | $ 62.4 |
Reserve for workers' compensation risks | 226 | 223.7 | |
Health insurance reserve | $ 19.6 | $ 21.8 |
Commitments and Contingencies92
Commitments and Contingencies - Litigation (Details) $ in Millions | Aug. 06, 2014claim | Jul. 31, 2016USD ($)item | Jun. 30, 2016USD ($) | Dec. 31, 2016USD ($)item | Dec. 31, 2015USD ($) |
Loss Contingencies | |||||
Number of matters under agreement in principle | item | 4 | ||||
Litigation settlement amount | $ 52.7 | ||||
Loss contingency | $ 13.6 | ||||
Loss contingency settlement term | 5 years | ||||
Environmental Remediation at Leased Sites [Member] | |||||
Loss Contingencies | |||||
Estimated settlement value | $ 22 | ||||
Environmental Remediation at Leased Sites [Member] | Other Noncurrent Liabilities [Member] | |||||
Loss Contingencies | |||||
Asset Retirement Obligation | $ 9.9 | $ 9.5 | |||
Creekside Hospice Investigation | |||||
Loss Contingencies | |||||
Number of Qui Tam proceedings | claim | 2 | ||||
SunDance Part B Therapy Matter | |||||
Loss Contingencies | |||||
Number of subsidiary agencies outside of Georgia that are part of the Qui Tam proceeding | item | 0 |
Fair Value of Financial Instr93
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Assets, Fair Value Disclosure [Abstract] | ||||
Goodwill, Impairment Loss | $ 0 | $ 0 | $ 0 | $ 0 |
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Revolving credit facility | 392,850 | 392,850 | ||
Carrying value | 1,171,144 | 1,171,144 | 1,198,636 | |
Term Loan Facility | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Carrying value | 210,842 | |||
Original issue discount | 7,475 | |||
New term loan agreement | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Carrying value | 116,174 | 116,174 | ||
Skilled Real Estate Bridge Loan | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Carrying value | 313,549 | 313,549 | 484,533 | |
HUD insured loans | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Carrying value | 241,570 | 241,570 | 106,250 | |
Welltower Notes | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Carrying value | 73,829 | 73,829 | ||
Original issue discount | 990 | 990 | ||
Mortgages and other secured debt (recourse) | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Carrying value | 13,235 | 13,235 | 13,934 | |
Mortgages and other secured debt (non-recourse) | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Carrying value | 29,157 | 29,157 | 30,331 | |
Revolving Credit Facility | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Revolving credit facility | 392,900 | 392,900 | ||
Carrying value | 383,630 | 383,630 | 352,746 | |
Original issue discount | 9,220 | 9,220 | 10,254 | |
Level 2 | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Fair Value | 1,156,557 | 1,156,557 | 1,198,065 | |
Level 2 | Term Loan Facility | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Fair Value | 210,271 | |||
Level 2 | New term loan agreement | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Fair Value | 116,174 | 116,174 | ||
Level 2 | Skilled Real Estate Bridge Loan | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Fair Value | 313,549 | 313,549 | 484,533 | |
Level 2 | HUD insured loans | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Fair Value | 226,983 | 226,983 | 106,250 | |
Level 2 | Welltower Notes | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Fair Value | 73,829 | 73,829 | ||
Level 2 | Mortgages and other secured debt (recourse) | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Fair Value | 13,235 | 13,235 | 13,934 | |
Level 2 | Mortgages and other secured debt (non-recourse) | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Fair Value | 29,157 | 29,157 | 30,331 | |
Level 2 | Revolving Credit Facility | ||||
Financial Liabilities Fair Value Disclosure [Abstract] | ||||
Fair Value | 383,630 | 383,630 | 352,746 | |
Fair Value, Measurements, Recurring | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Cash and equivalents | 51,408 | 51,408 | 61,543 | |
Restricted cash and equivalents | 12,052 | 12,052 | 34,370 | |
Assets, Fair Value Disclosure, Total | 207,434 | 207,434 | 259,670 | |
Fair Value, Measurements, Recurring | Mortgage/Government Backed Securities | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Restricted investments in marketable securities | 16,844 | 16,844 | 13,202 | |
Fair Value, Measurements, Recurring | Corporate Bond Securities [Member] | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Restricted investments in marketable securities | 65,305 | 65,305 | 82,583 | |
Fair Value, Measurements, Recurring | Government Bonds | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Restricted investments in marketable securities | 61,825 | 61,825 | 67,972 | |
Fair Value, Measurements, Recurring | Level 1 | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Cash and equivalents | 51,408 | 51,408 | 61,543 | |
Restricted cash and equivalents | 12,052 | 12,052 | 34,370 | |
Assets, Fair Value Disclosure, Total | 207,434 | 207,434 | 259,670 | |
Fair Value, Measurements, Recurring | Level 1 | Mortgage/Government Backed Securities | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Restricted investments in marketable securities | 16,844 | 16,844 | 13,202 | |
Fair Value, Measurements, Recurring | Level 1 | Corporate Bond Securities [Member] | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Restricted investments in marketable securities | 65,305 | 65,305 | 82,583 | |
Fair Value, Measurements, Recurring | Level 1 | Government Bonds | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Restricted investments in marketable securities | 61,825 | 61,825 | 67,972 | |
Fair Value, Measurements, Nonrecurring [Member] | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Property and equipment, Impairment charges | 32,110 | 26,768 | ||
Intangible assets, Impairment Loss | 3,321 | 1,778 | ||
Fair Value, Measurements, Nonrecurring [Member] | Level 3 | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Property and equipment, net | 3,765,393 | 3,765,393 | 4,085,247 | |
Goodwill | 440,712 | 440,712 | 470,019 | |
REMOVE - Intangible assets | $ 175,566 | $ 175,566 | $ 209,967 |
Quarterly Financial Informati94
Quarterly Financial Information (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net revenues | $ 1,402,860 | $ 1,418,994 | $ 1,438,358 | $ 1,472,218 | $ 1,440,721 | $ 1,416,027 | $ 1,419,475 | $ 1,343,001 | $ 5,732,430 | $ 5,619,224 | $ 4,768,080 |
Loss from continuing operations attributable to Genesis Healthcare, Inc. | 22,429 | (20,434) | (23,034) | (43,001) | (265,843) | (28,991) | (17,464) | (112,678) | (118,078) | (525,549) | (237,485) |
Income (loss) from discontinued operations, net of taxes | 28 | (24) | 61 | (38) | 352 | 39 | (1,722) | 112 | 27 | (1,219) | (14,044) |
Net loss attributable to Genesis Healthcare, Inc | $ 22,457 | $ (20,458) | $ (22,973) | $ (43,039) | $ (265,491) | $ (28,952) | $ (19,186) | $ (112,566) | $ (64,013) | $ (426,195) | $ (253,985) |
Net (loss) income per common share attributable to Genesis Healthcare, Inc. | |||||||||||
Basic | $ 0.25 | $ (0.23) | $ (0.26) | $ (0.48) | $ (0.71) | $ (4.97) | $ (5.09) | ||||
Diluted | $ 0.24 | $ (0.23) | $ (0.26) | $ (0.48) | $ (0.82) | $ (4.97) | $ (5.09) | ||||
Net (loss) income attributable to Genesis Healthcare, Inc. | $ (2.98) | $ (0.32) | $ (0.22) | $ (1.50) | |||||||
Earnings Per Share, Diluted, Other Disclosures [Abstract] | |||||||||||
Basic | 90,636 | 90,226 | 89,421 | 89,198 | 89,873 | 85,755 | 49,865 | ||||
Diluted | 92,337 | 90,226 | 89,421 | 89,198 | 152,532 | 85,755 | 49,865 | ||||
Shares used in computing loss per common share | 89,197 | 89,213 | 89,211 | 75,234 | |||||||
Period of revenue associated with the combination | 2 months | ||||||||||
Gain on sales of owned assets, divestitures of leased facilities and other lease transactions | $ 160,000 | ||||||||||
Change in valuation allowance | $ 221,900 | ||||||||||
Asset Impairment Charges | $ 35,000 | $ 28,500 | $ 35,431 | $ 28,546 | $ 31,399 |
Schedule II - Valuation Accou95
Schedule II - Valuation Accounts (Details) - Accounts receivable allowances - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Movement in Valuation Allowances and Reserves | |||
Balance at beginning of period | $ 189,739 | $ 133,529 | $ 106,093 |
Charged to cost and expenses | 93,311 | 86,224 | 70,950 |
Other | (1,655) | ||
Deductions or payments | (63,012) | (30,014) | (43,514) |
Balance at end of period | $ 218,383 | $ 189,739 | $ 133,529 |