Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 04, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes | |
Entity Registrant Name | Oak Street Health, Inc. | |
Entity Central Index Key | 0001564406 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 30 W. Monroe Street Suite 1200 | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60603 | |
City Area Code | 312 | |
Local Phone Number | 733-9730 | |
Title of 12(b) Security | Common Stock, $0.001 par value | |
Trading Symbol | OSH | |
Security Exchange Name | NYSE | |
Entity Common Stock, Shares Outstanding | 240,790,848 | |
Entity File Number | 001-39427 | |
Entity Tax Identification Number | 84-3446686 |
Consolidated Balance sheets
Consolidated Balance sheets - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Long-term liabilities: | ||
Long-term operating lease liabilities (Humana comprised $37.8 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | $ 118.3 | |
Deferred rent expense (Humana comprised $0.0 and $0.8 as of March 31, 2021 and December 31, 2020, respectively) | $ 13.5 | |
OAK Street Health Inc and Affiliates [Member] | ||
Current assets: | ||
Cash | 1,146.4 | 409.3 |
Restricted cash | 10.4 | 10.4 |
Other patient service receivables, net (Humana comprised $0.1 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | 1.1 | 7.6 |
Capitated accounts receivable (Humana comprised $87.2 and $65.7 as of March 31, 2021 and December 31, 2020, respectively) | 293.6 | 248.9 |
Prepaid expenses | 6 | 6.8 |
Other current assets | 5.1 | 4.2 |
Total current assets | 1,462.6 | 687.2 |
Long-term assets: | ||
Property and equipment, net | 84.1 | 78.8 |
Security deposits | 1.4 | 1.3 |
Operating lease right-of-use assets (Humana comprised $40.6 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | 112.6 | |
Goodwill | 11.4 | 9.6 |
Intangible assets, net | 2.9 | 3 |
Other long-term assets | 1 | 1.1 |
Total assets | 1,676 | 781 |
Current liabilities: | ||
Accounts payable | 11.5 | 8.8 |
Accrued compensation and benefits | 39.2 | 32 |
Liability for unpaid claims (Humana comprised $78.8 and $78.5 as of March 31, 2021 and December 31, 2020, respectively) | 274.6 | 262.1 |
Other liabilities (Humana comprised $10.8 and $4.6 as of March 31, 2021 and December 31, 2020, respectively) | 30.3 | 12.6 |
Total current liabilities | 355.6 | 315.5 |
Long-term liabilities: | ||
Long-term operating lease liabilities (Humana comprised $37.8 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | 118.3 | |
Deferred rent expense (Humana comprised $0.0 and $0.8 as of March 31, 2021 and December 31, 2020, respectively) | 13.5 | |
Other long-term liabilities (Humana comprised $22.5 and $20.1 as of March 31, 2021 and December 31, 2020, respectively) | 26 | 28.8 |
Long-term debt | 898.1 | |
Total liabilities | 1,398 | 357.8 |
Commitments and contingencies (See Notes 7 & 14) | ||
Stockholders' equity: | ||
Preferred Stock, par value $0.001; 50,000,000 shares authorized as of March 31, 2021 and December 31, 2020; no shares issued and outstanding as of March 31, 2021 and December 31, 2020 | ||
Common stock, par value $0.001; 500,000,000 shares authorized as of March 31, 2021 and December 31, 2020; 240,784,438 and 240,756,714 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively | 0.2 | 0.2 |
Additional paid-in capital (Humana comprised $50.0 and $50.0 as of March 31, 2021 and December 31, 2020, respectively) | 891.7 | 971.8 |
Accumulated deficit | (619.2) | (555.8) |
Total stockholders' equity allocated to Oak Street Health, Inc. | 272.7 | 416.2 |
Non-controlling interests | 5.3 | 7 |
Total stockholders' equity | 278 | 423.2 |
Total liabilities and stockholders' equity | $ 1,676 | $ 781 |
Consolidated Balance sheets (Pa
Consolidated Balance sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Long-term operating lease liabilities (Humana comprised $37.8 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | $ 118.3 | |
Deferred rent expense (Humana comprised $0.0 and $0.8 as of March 31, 2021 and December 31, 2020, respectively) | $ 13.5 | |
OAK Street Health Inc and Affiliates [Member] | ||
Other patient service receivables, net (Humana comprised $0.1 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | 1.1 | 7.6 |
Capitated accounts receivable (Humana comprised $87.2 and $65.7 as of March 31, 2021 and December 31, 2020, respectively) | 293.6 | 248.9 |
Operating lease right-of-use assets (Humana comprised $40.6 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | 112.6 | |
Liability for unpaid claims (Humana comprised $78.8 and $78.5 as of March 31, 2021 and December 31, 2020, respectively) | 274.6 | 262.1 |
Other liabilities (Humana comprised $10.8 and $4.6 as of March 31, 2021 and December 31, 2020, respectively) | 30.3 | 12.6 |
Long-term operating lease liabilities (Humana comprised $37.8 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | 118.3 | |
Deferred rent expense (Humana comprised $0.0 and $0.8 as of March 31, 2021 and December 31, 2020, respectively) | 13.5 | |
Other long-term liabilities (Humana comprised $22.5 and $20.1 as of March 31, 2021 and December 31, 2020, respectively) | $ 26 | $ 28.8 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 240,784,438 | 240,756,714 |
Common stock, shares outstanding | 240,784,438 | 240,756,714 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Additional paid-in capital (Humana comprised $50.0 and $50.0 as of March 31, 2021 and December 31, 2020, respectively) | $ 891.7 | $ 971.8 |
OAK Street Health Inc and Affiliates [Member] | Humana [Member] | ||
Other patient service receivables, net (Humana comprised $0.1 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | 0.1 | 0 |
Capitated accounts receivable (Humana comprised $87.2 and $65.7 as of March 31, 2021 and December 31, 2020, respectively) | 87.2 | 65.7 |
Operating lease right-of-use assets (Humana comprised $40.6 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | 40.6 | 0 |
Liability for unpaid claims (Humana comprised $78.8 and $78.5 as of March 31, 2021 and December 31, 2020, respectively) | 78.8 | 78.5 |
Other liabilities (Humana comprised $10.8 and $4.6 as of March 31, 2021 and December 31, 2020, respectively) | 10.8 | 4.6 |
Long-term operating lease liabilities (Humana comprised $37.8 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | 37.8 | 0 |
Deferred rent expense (Humana comprised $0.0 and $0.8 as of March 31, 2021 and December 31, 2020, respectively) | 0 | 0.8 |
Other long-term liabilities (Humana comprised $22.5 and $20.1 as of March 31, 2021 and December 31, 2020, respectively) | 22.5 | 20.1 |
Additional paid-in capital (Humana comprised $50.0 and $50.0 as of March 31, 2021 and December 31, 2020, respectively) | $ 50 | $ 50 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Other (expense)/ income: | ||
Net loss | $ (64) | $ (15.4) |
OAK Street Health Inc and Affiliates [Member] | ||
Total revenues | 296.7 | 201.8 |
Operating expenses: | ||
Cost of providing patient care in relation to revenue waived | 186.1 | 90.2 |
Sales and marketing | 24.1 | 11.9 |
Corporate, general and administrative expenses | 73.1 | 24.3 |
Depreciation and amortization | 3.3 | 2.5 |
Total operating expenses | 360.5 | 214.8 |
Loss from operations | (63.8) | (13) |
Other (expense)/ income: | ||
Interest expense, net | (0.2) | (2.5) |
Other | 0.1 | |
Total other (expense)/ income, net | (0.2) | (2.4) |
Net loss | (64) | (15.4) |
Net loss attributable to non-controlling interests | 0.6 | 0.4 |
Net loss attributable to the Oak Street Health, Inc. | (63.4) | (15) |
Undeclared and deemed dividends | (9.6) | |
Net loss attributable to common stock/unitholders | $ (63.4) | (24.6) |
Weighted average common stock outstanding - basic and diluted | 220,736,845 | |
Net loss per share – basic and diluted | $ (0.29) | |
OAK Street Health Inc and Affiliates [Member] | Medical Claims Expenses [Member] | ||
Operating expenses: | ||
Cost of providing patient care in relation to revenue waived | $ 199.7 | 132.3 |
OAK Street Health Inc and Affiliates [Member] | Cost of Care [Member] | ||
Operating expenses: | ||
Cost of providing patient care in relation to revenue waived | 60.3 | 43.8 |
OAK Street Health Inc and Affiliates [Member] | Capitated Revenue [Member] | ||
Total revenues | 291.2 | 196.6 |
OAK Street Health Inc and Affiliates [Member] | Other Patient Service Revenue [Member] | ||
Total revenues | $ 5.5 | $ 5.2 |
Consolidated Statements of Op_2
Consolidated Statements of Operations - (Parenthetical) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Total revenues | $ 296.7 | $ 201.8 |
Cost of providing patient care in relation to revenue waived | 186.1 | 90.2 |
Medical Claims Expenses [Member] | ||
Cost of providing patient care in relation to revenue waived | 199.7 | 132.3 |
Medical Claims Expenses [Member] | Humana [Member] | ||
Cost of providing patient care in relation to revenue waived | 73 | 59.8 |
Cost of Care [Member] | ||
Cost of providing patient care in relation to revenue waived | 60.3 | 43.8 |
Cost of Care [Member] | Humana [Member] | ||
Cost of providing patient care in relation to revenue waived | 2 | 1.2 |
Capitated Revenue [Member] | ||
Total revenues | 291.2 | 196.6 |
Capitated Revenue [Member] | Humana [Member] | ||
Total revenues | 121.4 | 96.5 |
Other Patient Service Revenue [Member] | ||
Total revenues | 5.5 | 5.2 |
Other Patient Service Revenue [Member] | Humana [Member] | ||
Total revenues | $ 1.2 | $ 0.8 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Redeemable Investor Units and Stockholders' Equity/Members' (Deficit) - USD ($) $ in Millions | Total | OAK Street Health Inc and Affiliates [Member] | OAK Street Health Inc and Affiliates [Member]Redeemable Investor Units [Member] | OAK Street Health Inc and Affiliates [Member]Members' Capital [Member] | OAK Street Health Inc and Affiliates [Member]Common Stock [Member] | OAK Street Health Inc and Affiliates [Member]Additional Paid-In Capital [Member] | OAK Street Health Inc and Affiliates [Member]Accumulated Deficit [Member] | OAK Street Health Inc and Affiliates [Member]Non-controlling Interest [Member] |
Redeemable Investor, Beginning balance at Dec. 31, 2019 | $ 320,639 | |||||||
Beginning balance at Dec. 31, 2019 | $ (344.9) | $ 4.2 | $ (354.4) | $ 5.3 | ||||
Beginning balance (In Shares) at Dec. 31, 2019 | 11,000,619 | 2,530,864 | ||||||
Issuance of series I, II and III investor units | $ 224.4 | |||||||
Issuance of Series I, II and III Investor Units (In Shares) | 1,471,623 | |||||||
Issuance of common units | 265,500 | |||||||
Repurchases – profits interests | (5,531) | |||||||
Forfeitures - Profits Interests (In Shares) | (438) | |||||||
Stock and Unit-based compensation expense | 1.8 | $ 1.8 | ||||||
Net loss | $ (15.4) | (15.4) | (15) | (0.4) | ||||
Redeemable Investor, Ending balance at Mar. 31, 2020 | $ 545 | |||||||
Ending balance at Mar. 31, 2020 | (358.5) | $ 6 | (369.4) | 4.9 | ||||
Ending balance (In Shares) at Mar. 31, 2020 | 12,472,242 | 2,790,395 | ||||||
Beginning balance at Dec. 31, 2020 | 423.2 | $ 0.2 | $ 971.8 | (555.8) | 7 | |||
Beginning balance (In Shares) at Dec. 31, 2020 | 240,756,714 | |||||||
Purchase of capped calls | (123.6) | (123.6) | ||||||
Issuance of common stock upon vesting of restricted stock units, (in shares) | 17,864 | |||||||
Issuance of common stock upon exercise of options | $ 1.2 | 1.2 | ||||||
Issuance of common stock upon exercise of options, ( in shares) | 53,307 | 53,307 | ||||||
Forfeitures – profits interests | $ (0.1) | (0.1) | ||||||
Forfeitures - Profits Interests (In Shares) | (25,582) | (43,447) | ||||||
Stock and Unit-based compensation expense | $ 42.4 | 42.4 | ||||||
Payments to non-controlling interest | (1.1) | (1.1) | ||||||
Net loss | (64) | (64) | (63.4) | (0.6) | ||||
Redeemable Investor, Ending balance at Mar. 31, 2021 | $ 545 | $ 320,639 | ||||||
Ending balance at Mar. 31, 2021 | $ 278 | $ 0.2 | $ 891.7 | $ (619.2) | $ 5.3 | |||
Ending balance (In Shares) at Mar. 31, 2021 | 240,784,438 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Net loss | $ (64) | $ (15.4) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization of discount on debt and related issuance costs | 0.2 | 0.4 |
Depreciation and amortization | 3.3 | 2.5 |
Non-cash operating lease costs | 3.5 | |
Stock and unit-based compensation, net of forfeitures | 42.3 | 1.8 |
Change in fair value of bifurcated derivative | (0.1) | |
Change in operating assets and liabilities, net of impact of acquisitions: | ||
Accounts receivable | (38.2) | (58.3) |
Prepaid expenses and other current assets | (1) | 3.7 |
Security deposits and other long-term assets | 0.1 | 0.1 |
Accounts payable | 1.7 | (0.3) |
Accrued compensation and benefits | 7.2 | (13) |
Liability for unpaid claims | 12.5 | 41 |
Operating lease liabilities | (3) | |
Other current liabilities | 4.3 | 0.2 |
Other long-term liabilities | 2.3 | 0.4 |
Other | 0.1 | |
Net cash used in operating activities | (28.8) | (36.9) |
Cash flows from investing activities: | ||
Purchase of business | (1) | |
Purchases of property and equipment | (7.8) | (3.4) |
Net cash used in investing activities | (8.8) | (3.4) |
Cash flows from financing activities: | ||
Proceeds from borrowings on convertible senior notes, net | 898.2 | |
Purchase of capped calls | (123.6) | |
Proceeds from issuance of redeemable investor units | 224.4 | |
Capital distributions to non-controlling interests | (1.1) | |
Proceeds from exercise of options | 1.2 | |
Net cash provided by financing activities | 774.7 | 224.4 |
Net change in cash, cash equivalents and restricted cash | 737.1 | 184.1 |
Cash, cash equivalents and restricted cash, beginning of period | 419.7 | 42.3 |
Cash, cash equivalents and restricted cash, end of period | 1,156.8 | 226.4 |
Supplemental disclosures | ||
Cash paid for interest | 2 | |
Unpaid debt offering costs in accounts payable and accrued liabilities | 0.3 | |
Additions to construction in process funded through accounts payable | $ 0.6 | $ 0.1 |
Organization and Nature of Busi
Organization and Nature of Business | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Organization And Nature Of Business [Line Items] | |
Organization and Nature of Business | NOTE 1. ORGANIZATION AND NATURE OF BUSINESS Description of Business Oak Street Health, Inc. (collectively with its consolidated subsidiaries is referred to as “Oak Street Health,” “OSH,” “we,” “us,” “our,” or the “Company”) was formed as a Delaware corporation on October 22, 2019 for the purpose of completing a public offering and related reorganization transactions (collectively referred to as the “IPO”) in order to carry on the business of Oak Street Health, LLC (“OSH LLC”) and its affiliates. As the managing member of OSH LLC, Oak Street Health, Inc. operates and controls all of the business affairs of OSH LLC and its affiliates. The Company operates primary care centers serving Medicare beneficiaries. The Company, through its centers and management services organization, combines an innovative care model with superior patient experience. The Company invests resources into primary care to prevent unnecessary acute events and manage chronic illnesses. The Company engages Medicare eligible patients through the use of an innovative community outreach approach. Once patients are engaged, the Company integrates population health analytics, social support services and primary care into the care model to drive improved outcomes. The Company contracts with health plans to generate medical costs savings and realize a return on its investment in primary care. As of March 31, 2021, the Company operated 86 centers. Initial Public Offering and Reorganization Transactions On August 10, 2020, we completed our IPO in which we issued and sold 17,968,750 shares of common stock, par value $0.001 per share, at an offering price of $21.00 per share. The share amount included the exercise in full of the underwriters’ options to purchase 2,343,750 additional shares of common stock. We received net proceeds of $351.2 million, after deducting underwriting discounts and commissions of $22.6 million and deferred offering costs of $3.5 million. Deferred, direct offering costs were capitalized and recorded against proceeds from the offering and consisted of fees and expenses incurred in connection with the sale of our common stock in the IPO, including the legal, accounting, printing and other offering related costs. In conjunction with the IPO, OSH LLC completed a series of transactions that resulted in Oak Street Health, Inc. becoming the ultimate parent company of OSH LLC and subsidiaries. Additionally, immediately prior to the closing of the IPO, unitholders of OSH LLC exchanged their membership interests for common stock in Oak Street Health, Inc. as part of the related IPO reorganization transactions. All 15,928,876 units of our then outstanding redeemable investor units (preferred stock including their respective undeclared and deemed dividends) and members’ capital (former founders’ units and incentive units/profits interests) plus 1,924 of options to purchase incentive units were converted into 200,286,312 shares of common stock of the Company and 22,612,472 shares of restricted common stock subject to service-based vesting (“RSA”) of the Company. Basis of Presentation and Consolidation The accompanying unaudited interim consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been omitted pursuant to such regulations. These financial statements have been prepared on a basis consistent with the accounting principles applied for the fiscal year ended December 31, 2020 in the Company’s Form 10-K filed with the SEC. In the opinion of management, all adjustments (consisting of all normal and recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three-months ended March 31, 2021, including the impact of COVID-19, are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. The consolidated financial statements of the Company include the financial statements of all wholly owned subsidiaries and majority-owned or controlled companies. For those consolidated subsidiaries where our ownership is less than 100%, the portion of the net income or loss allocable to the non-controlling interests is reported as “Net loss (gain) attributable to non-controlling interests” in the consolidated statements of operations. Intercompany balances and transactions have been eliminated in consolidation. The Company evaluates its ownership, contractual and other interests in entities to determine if it has any variable interest in a variable interest entity (“variable interest entities” or “VIEs”). These evaluations are complex, involve judgment and the use of estimates and assumptions based on available historical information, among other factors. The Company considers itself to control an entity if it is the majority owner of or has voting control over such entity. The Company also assesses control through means other than voting rights and determines which business entity is the primary beneficiary of the VIE. The Company consolidates VIEs when it is determined that the Company is the primary beneficiary of the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. Changes in consolidation status are applied prospectively. Upon completion of our IPO, OSH’s sole material asset is its interest in OSH LLC and its affiliates. In accordance with the master structuring agreement dated August 10, 2020, by and among OSH and the other signatories party thereto (the “Master Structuring Agreement”), we have all management powers over the business and affairs of OSH LLC and to conduct, direct and exercise full control over the activities of OSH LLC. Due to our power to control the activities most directly affecting the results of OSH LLC, we are considered the primary beneficiary of the VIE. Accordingly, following the effective date of the IPO, we consolidate the financial results of OSH LLC and its affiliates and the financial statements for the periods prior to the IPO have been adjusted to combine the previously separate entities for presentation purposes. Oak Street Health MSO LLC (“MSO”), a wholly owned subsidiary of OSH LLC, was formed in 2013 to provide a wide range of management services to the Physician Groups (as defined below). Activities include but are not limited to operational support of the centers, marketing, information technology infrastructure and the sourcing and managing of health plan contracts. Oak Street Health Physicians Group PC, OSH-IN Physicians Group PC, OSH-MI Physicians Group PC, OSH-OH Physicians Group LLC, OSH-PA Physicians Group PC, OSH-RI Physicians Group PC, Oak Street Health of Texas, PLLC, Griffin Myers Medical PC, Oak Street Health Physicians Group of South Carolina LLC, Oak Street Health Physicians Group of Louisiana LLC and Oak Street Health Physicians Group of Mississippi LLC (collectively, the “Physician Groups”) employ healthcare providers to deliver primary care services to the Medicare covered population of Illinois, Indiana, Louisiana, Michigan, Mississippi, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas and New York. These entities are consolidated as each are considered variable interest entities where the Company has a controlling financial interest (see Note 15). In addition, Oak Street Health is the majority interest owner in three joint ventures: OSH-PCJ Joliet, LLC, OSH-RI, LLC and OSH-ESC Joint Venture, LLC, which are consolidated in the Company’s financial statements. In March 2021, distributions were made from OSH-PCJ Joliet, LLC to Oak Street Health MSO, LLC (50.1% ownership) and Primary Care Physicians of Joliet (49.9% ownership) totaling $1.1 million to each owner. Emerging Growth Company Status We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The JOBS Act provides that an emerging growth company can take advantage of the extended transition period for complying with new or revised accounting standards. We have elected to avail ourselves of this extended transition period and, as a result, we will not adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies until required by private company accounting COVID-19 The COVID-19 pandemic did not have a material impact on our results of operations, cash flows and financial position for the three-months ended March 31, 2021. Over 98% of our total revenues are recurring, consisting of fixed monthly per-patient-per-month capitation payments we receive from Medicare Advantage plans. On March 27, 2020, the United States President signed into law the Coronavirus Aid, Relief and Economic Securities Act (“CARES Act”) which provides economic assistance to a wide array of industries, including healthcare. Thus far, the Company has taken the following actions related to this legislation: • Provider Relief Funds. The U.S. Department of Health and Human Services (“HHS”) distributed grants to healthcare providers to offset the impacts of COVID-19 pandemic related expenses and lost revenues through the Public Health and Social Services Emergency Fund. Grants received are subject to the terms and conditions of the program, including that such funds may only be used to prevent, prepare for and respond to COVID-19 and will reimburse only for health care related expenses, general and administrative expenses or lost revenues that are attributable to the COVID-19 pandemic as defined by the HHS. Payments from this fund are not loans and, therefore, they are not subject to repayment. We recognize grant payments as income when there is reasonable assurance that we have complied with conditions associated with the grant. Our estimates could change materially in the future based on the government’s evolving compliance guidance. During the three-months ended March 31, 2021 and 2020, the Company received $2.6 million and $0.0 million, respectively, related to these grants and recognized $1.9 million and $0.0 million, respectively, as income to offset COVID-19 pandemic related expenses incurred in the cost of care, excluding depreciation and amortization. The remaining HHS grants of $1.6 million have been recorded in other current liabilities as they must be utilized or given back to HHS by June 30, 2021. • Medicare Accelerated and Advanced Payment Program. The Centers for Medicare & Medicaid Services (“CMS”) expanded its Accelerated and Advance Payment Program which allows participants to receive expedited payments during periods of national emergencies. Under the program, we received an interest-free advancement of 100% of our Medicare payment amount for a three-month period. Repayment will begin one year from the date the payments were received and will be paid back against future fee-for-service claims. Beginning at one year from the date the payment was issued and continuing for eleven months, payments will be recouped at a rate of 25%. After the eleven months end, payments will be recouped at a rate of 50% for another six months, after which any remaining balance will become due. During 2020, the Company received approximately $1.5 million in CMS advance payments, which were recorded in other current liabilities and will be paid back against future fee-for-service claims. • Payroll Tax Deferral. Under the CARES Act, the Company elected to defer payment on its portion of Social Security taxes, on an interest free basis, incurred from March 27, 2020 to December 31, 2020. One-half of such deferral amount will become due on each of December 31, 2021 and December 31, 2022. The total deferred payroll taxes were $7.0 million, $3.5 million was classified as a short-term liability and $3.5 million was classified as a long-term liability at March 31, 2021. • Temporary Suspension of Medicare Sequestration . The Budget Control Act of 2011 requires a mandatory, across the board reduction in federal spending, called a sequestration. Medicare fee-for-service claims with dates of service or dates of discharge on or after April 1, 2013 incur a 2.0% reduction in Medicare payments. All Medicare rate payments and settlements have incurred this mandatory reduction and it will continue to remain in place through at least 2023, unless Congress takes further action. In response to COVID-19, the CARES Act temporarily suspended the automatic 2.0% reduction of Medicare claim reimbursements for the period of May 1, 2020 through December 31, 2021, which immaterially increased both revenues and medical expenses for the three-months ended March 31, 2021. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Significant Accounting Policies [Line Items] | |
Summary of Significant Accounting Policies | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company described its significant accounting policies in Note 2 of the Notes to Consolidated Financial Statements for the year ended December 31, 2020 included in its Form 10-K. During the three-months ended March 31, 2021, there were no significant changes to those accounting policies, other than the adoption of ASC 842 (as defined below), Accounting Standards Update (“ASU”) 2020-06 and those policies impacted by the new accounting pronouncements adopted during the period and further described below as well as in the “Recently Adopted Accounting Pronouncements” section. Leases The Company leases offices, operating facilities, vehicles and IT equipment, which are accounted for as operating leases. These leases have remaining lease terms of up to 30 years, inclusive of renewal or termination options that the Company is reasonably certain to exercise. The Company determines if an arrangement is a lease at inception and evaluates the lease classification (i.e., operating lease or financing lease) at that time. Lease arrangements with an initial term of 12 months or less are considered short-term leases and are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the term of the lease Operating leases are included in operating lease right-of-use assets , operating lease liabilities, current portion (recorded within other current liabilities) and long-term operating lease liabilities The Company uses its incremental borrowing rate on the commencement date for determining the present value of lease payments. The Company considers the likelihood of exercising options to extend or terminate the lease when determining the lease term. The Company has lease agreements with lease and non-lease components. The Company has elected the practical expedient to account for the lease and non-lease components as a single lease component for all leases. Convertible Debt The Company evaluates all conversion, repurchase and redemption features contained in a debt instrument to determine if there are any embedded features that require bifurcation as a derivative. In accounting for the issuance of the 0% Convertible Senior Notes due 2026 issued in March 2021 (the “Convertible Senior Notes”), the Company Capped Call Transactions In connection with the issuance of the Convertible Senior Notes, the Company entered into capped call transactions. The capped call transactions are expected generally to reduce the potential dilution to the holders of the Company’s common stock upon any conversion of the Convertible Senior Notes. T Net Income (Loss) Per Share The diluted net income (loss) per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period determined using the treasury stock method or the if-converted method, as appropriate. For purposes of this calculation, stock options, restricted stock units, restricted stock awards and contingently issuable shares under our Convertible Senior Notes are considered common stock equivalents but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as their effect is anti-dilutive. Recently Adopted Accounting Pronouncements In 2016, the FASB issued guidance on leases, Accounting Standards Updates 2016-02, Leases (“ASU 2016-02), with amendments issued in 2018 and 2019 (collectively, “ASC 842”). ASC 842 requires lessees to recognize assets and liabilities related to lease arrangements on the balance sheet; leases are to be recorded as a lease liability (on a discounted basis) with a corresponding right-of-use (“ROU”) asset. Leases will be classified as finance or operating, with the classification affecting the pattern and classification of expense recognition over the lease term. The recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous GAAP. This guidance also expands the required quantitative and qualitative disclosures for leasing arrangements and gives rise to other changes impacting certain aspects of lessee and lessor accounting. The two permitted transition methods under the guidance are the modified retrospective transition approach, which requires application of the guidance for all comparative periods, and the cumulative effect adjustment approach, which requires prospective application the adoption date. We adopted ASC 842 as of January 1, 2021 on a prospective basis, did not adjust the comparative reporting periods and applied the lessee package of practical expedients. The package of practical expedients included that the Company was not required to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. Also, as part of the adoption, the Company elected to not recognize short-term leases (those with lease terms less than a year) on the consolidated balance sheets, not separate lease and non-lease components and did not use hindsight to determine lease term. The most significant impact was the recognition of ROU assets and lease liabilities for our operating leases. The ROU assets represent the right to use an underlying asset for the lease term, and lease liabilities represent an obligation to make lease payments arising from the lease at lease commencement date. The Company’s operating leases resulted in the recognition of additional assets and the corresponding liabilities on its consolidated balance sheets, however it did not have a material impact on the consolidated statements of operations or cash flows for the three- months ended March 31, 2021. The Company recognized ROU assets and lease liabilities for operating leases of $108.1 million and $126.8 million, respectively, upon adoption as of January 1, 2021. The difference between the lease liability and right-of-use asset mainly related to the reversal of existing deferred rent balances. The Company utilized a comprehensive approach to assess the impact of this guidance on the consolidated financial statements and related disclosures, including the increase in assets and liabilities on the consolidated balance sheets and the impact on the current lease portfolio. See Note 7 in this Quarterly Report for our lease accounting policy and the quarterly impact of our adoption of ASC 842. In August 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-06 Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity Among other changes, ASU 2020-06 removes the liability and equity separation model for convertible instruments with a cash conversion feature, and as a result, after adoption, entities will no longer separately present in equity an embedded conversion feature for such debt. Similarly, the embedded conversion feature will no longer be amortized into income as interest expense over the life of the instrument. Instead, entities will account for a convertible debt instrument wholly as debt unless (1) a convertible instrument contains features that require bifurcation as a derivative under ASC Topic 815, Derivatives and Hedging , or (2) a convertible debt instrument was issued at a substantial premium. Additionally, ASU 2020-06 requires the application of the if-converted method to calculate the impact of convertible instruments on diluted earnings per share and updates the disclosure requirements in ASC 470-20, making them easier to understand for financial statement preparers and improving the decision-usefulness and relevance of the information for financial statement users. Convertible Senior Notes, In December 2019, the FASB issued ASU 2019-12, “Income Taxes Topic 740-Simplifying the Accounting for Income Taxes” (“ASU 2019-12”), which intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application of ASC 740. This guidance is effective for fiscal years beginning after December 15, 2020, including interim periods therein. The Company adopted the new guidance on January 1, 2021, noting no impact on its consolidated financial statements and related disclosures In January 2020, the FASB issued ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (“ASU 2020-01”). Recent Accounting Pronouncements Not Yet Adopted In October 2018, the FASB issued ASU 2018-17, Consolidation – Targeted Improvements to Related Party Guidance for Variable Interest Entities (Topic 810) In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments We do not expect that any other recently issued accounting guidance will have a significant effect on our consolidated financial statements. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Revenue Recognition [Line Items] | |
Revenue Recognition | NOTE 3. REVENUE RECOGNITION Both our capitated and fee-for-service revenue generally relate to contracts with patients in which our performance obligation is to provide healthcare services to the patients. Revenues are recorded during the period our obligations to provide healthcare services are satisfied as noted below within each service type. Capitated Revenue and Accounts Receivable Capitated revenue consists primarily of capitated fees for medical services provided by us under capitated arrangements directly made with various Medicare Advantage managed care payors. The Company receives a fixed fee per patient under what is typically known as a “risk contract.” Risk contracting, or full risk capitation, refers to a model in which the Company receives from the third-party payor a fixed payment per patient per month (“PPPM” payment) for a defined patient population, and the Company is then responsible for providing healthcare services required by that patient population. The Company is responsible for incurring or paying for the cost of healthcare services required by that patient population in addition to those provided by the Company. Fees are recorded gross in revenues because the Company is acting as a principal in arranging for, providing and controlling the managed healthcare services provided to the managed care payors’ eligible enrolled members. Neither the Company nor any of its affiliates is a registered insurance company because state law in the states in which it operates does not require such registration for risk-bearing providers. The Company’s payor contracts generally have a term of one year or longer, but the contracts between the enrolled members (our customers) and the payor are one calendar year or less. In general, the Company considers all contracts with customers (enrolled members) as a single performance obligation to stand ready to provide managed healthcare services. The Company identified that contracts with customers for capitation arrangements have similar performance obligations and therefore groups them into one portfolio. This performance obligation is satisfied as the Company stands ready to fulfill its obligation to enrolled members. Our revenues are based upon the estimated PPPM amounts we expect to be entitled to receive from Medicare Advantage managed care payors. The PPPM rates are determined as a percent of the premium the Medicare Advantage plan receives from CMS for our at-risk members. Those premiums are determined via a competitive bidding process with CMS and are based upon the cost of care in a local market and the average utilization of services by the patients enrolled. Medicare pays capitation using a “risk adjustment model,” which compensates providers based on the health status (acuity) of each individual patient. Payors with higher acuity patients receive more, and those with lower acuity patients receive less. Under the risk adjustment model, capitation is paid on an interim basis based on enrollee data submitted for the preceding year and is adjusted in subsequent periods after the final data is compiled. As premiums are adjusted via this risk adjustment model, our PPPM payments will change in unison with how our payor partners’ premiums change with CMS. The Company determined the transaction price for these contracts is variable as it primarily includes PPPM fees which can fluctuate throughout the contract based on the acuity of each individual enrollee. Our capitated accounts receivable includes $32.2 million and $23.5 million as of March 31, 2021 and 2020, respectively, for acuity-related adjustments that are estimated to be received in subsequent periods. In certain contracts, PPPM fees also include adjustments for items such as performance incentives or penalties based on the achievement of certain clinical quality metrics as contracted with payors. There were no PPPM adjustments related to performance incentives/penalties for quality-related metrics for the three-months ended March 31, 2021 and 2020. The capitated revenues are recognized based on the estimated PPPM transaction price to transfer the service for a distinct increment of the series (i.e. month) and is recognized net of projected acuity adjustments and performance incentives/penalties because the Company is able to reasonably estimate the ultimate PPPM payment of these contracts. We recognize revenue in the month in which eligible members are entitled to receive healthcare benefits during the contract term. Subsequent changes in PPPM fees and the amount of revenue to be recognized by the Company are reflected through subsequent period adjustments to properly recognize the ultimate capitation amount and do not result in a significant reversal of revenue when the uncertainty is resolved in subsequent periods. As the period between the time of service and time of payment is typically one year or less, the Company elected the practical expedient under ASC 606-10-32-18 and did not adjust for the effects of a significant financing component. Certain third-party payor contracts include a Medicare Part D payment related to pharmacy claims, which is subject to risk sharing through accepted risk corridor provisions. Under certain agreements the fund risk allocation is established where the Company, as the contracted provider, receives only a portion of the risk and the associated surplus or deficit. The Company estimates and recognizes an adjustment to Part D capitated revenues related to these risk corridor provisions, based upon pharmacy claims experience to date, as if the annual risk contract were to terminate at the end of the reporting period. Medicare Part D comprised 2% of capitated revenues for the three-months ended March 31, 2021 and 2020, and 3% and 4% of medical claims expense for the three-months ended March 31, 2021 and 2020, respectively. The Company had agreements in place with the payors listed below and payor sources of capitated revenue for each period presented were as follows: For the Three-Months Ended March 31, 2021 March 31, 2020 Humana 42 % 49 % Wellcare/Meridian 18 % 14 % Cigna-HealthSpring 10 % 11 % Other 30 % 26 % Other Patient Service Revenue Other patient service revenue is comprised of ancillary fees earned under contracts with certain managed care organizations for the provision of certain care coordination services and care management services and is also comprised of fee-for-service revenue. The composition of other patient service revenue for each period was as follows ($ in millions): For the Three-Months Ended March 31, 2021 March 31, 2020 Care coordination and care management $ 3.9 $ 4.1 Fee for service 1.6 1.1 Total other patient service revenue $ 5.5 $ 5.2 The Company has entered into multi-year agreements with Humana and its affiliates to provide services at certain centers to members covered by Humana. The agreements contain an administrative payment from Humana in exchange for the Company providing certain care coordination services during the term of the contract (“Care Coordination Payment”). The Care Coordination Payments are recognized in other patient service revenue ratably over the length of the terms stated in the contracts and are refundable to Humana on a pro-rata basis if the Company ceases to provide services at the centers within the length of the term specified in the contracts. We have identified a single performance obligation to stand ready to provide care coordination services to patients, which constitutes a series of distinct service increments. As of March 31, 2021 and December 31, 2020, the Company’s contract liabilities related to these payments totaled $18.2 million and $16.6 million, respectively. The short-term portion is recorded in other liabilities and the long-term portion is included in other long-term liabilities in the accompanying consolidated balance sheets. Care management services are provided to enrolled members of certain contracted managed care organizations regardless of whether those members are Oak Street Health patients. Similar to the other care management services provided to the Company’s centers, the Company provides delegated services and other administrative services to plans in order to assist with the management of its Medicare population, therefore, we have identified a single performance obligation to stand ready to provide care management services, which constitutes a series of distinct service increments. Fee-for-service revenue is primarily derived from healthcare services rendered to patients. The services provided by the Company have no fixed duration and can be terminated by the patient or the Company at any time, therefore each treatment is its own standalone contract. Services ordered by a healthcare provider during an office visit are not separately identifiable, and therefore have been combined into a single performance obligation for each contract. The Company recognizes revenue as its performance obligation is completed on the date of service. Fee-for-service revenue is recognized in the period in which services are provided at estimated net realizable amounts from patients, third-party payors and others. The fee-for-service revenue by payor source for each period presented were as follows: For the Three-Months Ended March 31, 2021 March 31, 2020 Medicare 38 % 46 % Humana 11 % 8 % Other 51 % 46 % Other patient service accounts receivable consists primarily of amounts due from Medicare and Medicare Advantage plans for fee-for-service patients. Receivables from commercial or government payors are recorded at a net amount determined by the original charge for the service provided, less contractual discounts provided to the payor. Receivables due directly from patients are recorded at the original charge for the service provided less amounts covered by third-party payors and an allowance for financial assistance. The Company has a financial assistance policy in which patients will be assessed for financial hardship and other criteria that are used to make a good-faith determination of financial need, in which case the Company will waive or reduce a Medicare beneficiary’s obligation to pay copay, coinsurance or deductible amounts owed for the provision of medical services. The majority of our fee-for-service patients qualify for financial assistance. The total amount of patient revenues that were waived per the Company’s financial assistance policy were $1.2 million and $1.5 million for the three-months ended March 31, 2021 and 2020, respectively. The Company’s cost to provide care in regard to the services for which the patient’s financial obligation was waived was estimated to be $3.5 million and $2.5 million for the three-months ended March 31, 2021 and 2020, respectively using a cost-to-charge ratio estimate. The Company invests heavily in primary care to prevent unnecessary acute events and manage chronic illnesses, and the cost incurred exceeds the amount that the Company would have realized under fee-for-service payment arrangements. The Company is willing to accept this deficit as many fee-for-service patients become Medicare Advantage patients under capitated arrangements. Remaining Performance Obligations As our performance obligations relate to contracts with a duration of one year or less, the Company elected the optional exemption in ASC 606-10-50-14(a). Therefore, the Company is not required to disclose the transaction price for the remaining performance obligations at the end of the reporting period or when the Company expects to recognize revenue. The Company has minimal unsatisfied performance obligations at the end of the reporting period as our patients typically are under no obligation to continue receiving services at our facilities. |
Fair value of Financial Instrum
Fair value of Financial Instruments | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Fair Value Of Financial Instruments [Line Items] | |
Fair value of Financial Instruments | Note 4. Fair Value of Financial Instruments The carrying amounts of financial instruments including cash, accounts receivable, accounts payable, accrued liabilities and short-term borrowings approximate fair value due to the short maturity of these instruments. The Company's Convertible Senior Notes are classified within Level 2 of the fair value hierarchy as the valuation inputs are based on quoted prices in an inactive market on the last day in the reporting period. As of March 31, 2021, the fair value of the Convertible Senior Notes was $918.3 million compared to their carrying value of $898.1 million, which is net of unamortized debt issuance and offering costs. |
Property And Equipment
Property And Equipment | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Property, Plant and Equipment [Line Items] | |
Property And Equipment | NOTE 5. PROPERTY AND EQUIPMENT Property and equipment consisted of the following as of March 31, 2021 and December 31, 2020 ($ in millions): March 31, 2021 December 31, 2020 Leasehold improvements $ 67.5 $ 63.6 Furniture and fixtures 5.1 4.9 Computer equipment 20.6 17.8 Internal use software 7.7 6.1 Office equipment 9.9 9.7 Construction in process 4.0 4.2 Total, at cost 114.8 106.3 Less accumulated depreciation (30.7 ) (27.5 ) Property and equipment, net $ 84.1 $ 78.8 The Company recorded depreciation expense of $3.2 million and $2.4 million for the three-months ended March 31, 2021 and 2020, respectively. The Company expensed $0.3 million and $0.1 million of capitalized development costs for the three-months ended March 31, 2021 and 2020, respectively. Capitalized external software costs include the actual costs to purchase software licenses from vendors. Costs incurred to maintain existing software are expensed as incurred. |
Goodwill And Intangible Assets
Goodwill And Intangible Assets | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Goodwill and Intangible Assets [Line Items] | |
Goodwill And Intangible Assets | NOTE 6. GOODWILL AND INTANGIBLE ASSETS On January 22, 2021, Oak Street Health entered into an agreement to purchase the assets of a medical practice for $1.8 million base purchase price which was accounted for under the acquisition method of accounting pursuant to ASC 805. Goodwill, which represents the excess of cost over the fair value of net assets acquired, amounted to $11.4 million and $9.6 million at March 31, 2021 and December 31, 2020, respectively. Intangible assets with a finite useful life continue to be amortized over its useful lives. Net intangible assets amounted to $2.9 million and $3.0 million at March 31, 2021 and December 31, 2020, respectively. The Company recorded amortization expense of $0.1 million for the three-months ended March 31, 2021 and 2020. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Leases | NOTE 7. LEASES ASC 842 Disclosures The Company leases offices, operating facilities, vehicles and IT equipment, which are accounted for as operating leases. These leases have remaining lease terms of up to 30 years, inclusive of renewal or termination options that the Company is reasonably certain to exercise. Operating lease and variable lease costs are included in cost of care, excluding depreciation and amortization and corporate, general and administrative expenses in the consolidated statements of operations. Variable lease costs are the portion of lease payments that are not fixed over the lease term. Variable lease costs include real estate payments that are adjusted periodically for inflation or other variables as well as payments for taxes, insurance, maintenance and other expenses. Also included in variable lease costs are license fees paid to Humana (see Note 16). We expense variable lease costs as incurred. The Company elected to combine lease and non-lease components as a single lease component and not include short-term leases, defined as leases with an initial term of twelve months or less, in its consolidated balance sheets. The Company’s short-term leases were immaterial. The components of lease expense for the Company’s operating leases were as follows for the three-months ended March 31, 2021 ($ in millions): March 31, 2021 Operating lease cost $ 4.5 Variable lease cost 4.9 Total lease cost $ 9.4 The Company entered into operating leases that resulted in $7.6 million of right-of-use assets in exchange for operating lease obligations for the three-months ended March 31, 2021. The weighted-average remaining lease term and discount rate for operating lease liabilities included in the consolidated balance sheets are as follows: March 31, 2021 Weighted-average remaining lease term (in years) 10.6 Weighted-average discount rate 4.07 % The table below presents the future minimum lease payments under the noncancelable operating leases as of March 31, 2021 ($ in millions): 2021 $ 13.7 2022 17.7 2023 16.3 2024 14.7 2025 13.9 2026 13.7 Thereafter 75.4 Total lease payments $ 165.4 Less: imputed interest (34.0 ) Total operating lease liabilities $ 131.4 Reported as: Operating lease liabilities, current (1) 13.1 Operating lease liabilities, noncurrent 118.3 Total operating lease liabilities $ 131.4 (1) Included in other liabilities on the consolidated balance sheet ASC 840 Disclosures Prior to adoption of ASC 842, the Company accounted for its lease arrangements under ASC 840, Leases, with no ROU assets or lease liabilities being reflected on the consolidated balance sheets. Therefore, the Company recognized $4.6 million (including $0.9 million of Humana license fee expense) of rent expense for the three-months ended March 31, 2020 included in costs of care and corporate, general and administrative expenses in the consolidated statements of operations. Additionally, the Company recorded $13.5 million at December 31, 2020 of deferred rent that was classified as a long-term liability in the consolidated balance sheets. |
Other Current And Long-Term Lia
Other Current And Long-Term Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Other Liabilities [Line Items] | |
Other Current And Long Term Liabilities Disclosure | NOTE 8. OTHER CURRENT AND LONG-TERM LIABILITIES Accrued compensation and benefits consisted of the following as of ($ in millions): March 31, 2021 December 31, 2020 Accrued paid time off $ 6.1 $ 5.0 Accrued bonus and commission 20.9 19.1 Employee stock purchase plan contributions 1.4 - Accrued payroll and taxes 5.7 1.8 CARES Act deferred payroll taxes 3.5 3.5 Other 1.6 2.6 $ 39.2 $ 32.0 Other current liabilities consisted of the following as of ($ in millions): March 31, 2021 December 31, 2020 Humana license fee $ 2.7 $ 0.6 Operating lease liabilities 13.1 - Contract liabilities, current 4.4 4.3 Accrual for goods or services received, not invoiced 4.5 3.6 CARES Act Medicare advances & Provider Relief Funds 3.1 2.3 Other current liabilities 2.5 1.8 $ 30.3 $ 12.6 Other long-term liabilities consisted of the following as of ($ in millions): March 31, 2021 December 31, 2020 Humana license fee, net of current $ 8.4 $ 7.3 Contract liabilities, net of current 14.1 12.8 Lease incentive obligation, net of current - 5.1 CARES Act deferred payroll taxes 3.5 3.5 Other long-term liabilities 0.0 0.1 $ 26.0 $ 28.8 |
Liability For Unpaid Claims
Liability For Unpaid Claims | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Disclosure Of Liability For Unpaid Claims | NOTE 9. LIABILITY FOR UNPAID CLAIMS Medical claims expense and the liability for unpaid claims include estimates of the Company’s obligations for medical care services that have been rendered by third parties on behalf of insured consumers for which the Company is contractually obligated to pay (through the Company’s full risk capitation arrangements), but for which claims have either not yet been received, processed, or paid. The Company develops estimates for medical care services incurred but not reported, which includes estimates for claims that have not been received or fully processed, using a process that is consistently applied, centrally controlled and automated. This process includes utilizing actuarial models when a sufficient amount of medical claims history is available from the third-party healthcare service providers. The actuarial models consider factors such as time from date of service to claim processing, seasonal variances in medical care consumption, health care professional contract rate changes, medical care utilization and other medical cost trends, membership volume and demographics, the introduction of new technologies, and benefit plan changes. In developing its unpaid claims liability estimates, the Company applies different estimation methods depending on which incurred claims are being estimated. For the most recent three-months, the Company estimates claim costs incurred by applying observed medical cost trend factors to the average PPPM medical costs incurred in prior months for which more complete claims data are available, supplemented by a review of near-term completion factors (actuarial estimates, based upon historical experience and analysis of current trends, of the percentage of incurred claims during a given period that have been adjudicated by the Company at the date of estimation). For the months prior to the most recent three-months, the Company applies completion factors to actual claims adjudicated-to-date to estimate the expected amount of ultimate incurred claims for those months. The Company purchases provider excess insurance to protect against significant, catastrophic claims expenses incurred on behalf of its patients. The total amount of provider excess insurance premium was $0.9 million and $0.8 million, and total reimbursements were $0.4 million and $0.3 million for the three-months ended March 31, 2021 and 2020, respectively. The provider excess insurance premiums less reimbursements are reported in medical claims expense in the consolidated statements of operations. Provider excess recoverables due are reported in other current assets in the consolidated balance sheets. As of March 31, 2021, the Company’s provider excess insurance deductible was $0.3 million per member and covered up to a maximum of $5.0 million per member per calendar year. Activity within liabilities for unpaid claims was as follows for the three-months ended March 31, 2021 and 2020 ($ in millions): March 31, 2021 March 31, 2020 Balance, beginning of period $ 262.1 $ 170.6 Incurred health care costs: Current year 192.3 131.4 Prior years 6.6 - Total claims incurred $ 198.9 $ 131.4 Claims paid: Current year (20.6 ) (59.7 ) Prior years (165.5 ) (30.5 ) Total claims paid $ (186.1 ) $ (90.2 ) Adjustments to other claims-related liabilities (0.3 ) (0.2 ) Balance, end of period $ 274.6 $ 211.6 We assess the profitability of our managed care capitation arrangement to identify contracts where current operating results or forecasts indicate probable future losses. If anticipated future variable costs exceed anticipated future revenues, a premium deficiency reserve is recognized. No premium deficiency reserves were recorded as of March 31, 2021 and December 31, 2020. |
Long- Term Debt
Long- Term Debt | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Long- Term Debt | NOTE 10. LONG-TERM DEBT Convertible Senior Notes On March 16, 2021, the Company issued, at par value, $920.0 million aggregate principal amount of 0% Convertible Senior Notes in a private offering exempt from registration under the Securities Act of 1933, including (collectively, the “Convertible Senior Notes”). Total proceeds received by the Company from the sale of the Convertible Senior Notes, net of debt issuance and offering costs of $22.1 million, were $897.9 million. The Company used $123.6 million of the net proceeds to pay for the cost of the capped call transactions (see discussion on capped call transactions further below). The Convertible Senior Notes are governed by an indenture (“Indenture”), dated as of March 16, 2021, between the Company and U.S. Bank National Association, as trustee. Under the Indenture, the Convertible Senior Notes are general senior, unsecured obligations of the Company and will mature on March 15, 2026, unless earlier redeemed, repurchased or converted. The Convertible Senior Notes are equal in right of payment with the Company’s future senior, unsecured indebtedness and structurally subordinated to all indebtedness and liabilities of the Company’s subsidiaries. T he Convertible Senior Notes will not bear regular interest, and the principal amount of the Convertible Senior Notes will not accrete. W e will pay special interest, if any, at a rate per annum not exceeding 0.50% of the principal amount of the notes outstanding as the sole remedy at our election relating to the failure to comply with our reporting requirements with the Securities and Exchange Commission and certain other obligations under the Indenture for the first 365 days after the occurrence of such an event of default. The Convertible Senior Notes are convertible, subject to certain conditions described below, into shares of our common stock at an initial conversion rate of 12.6328 shares per $1,000 principal amount of the Convertible Senior Notes, which represents an initial conversion price of approximately $79.16 per share, subject to adjustments upon occurrence of certain events set forth in the Indenture. Certain events described in the Indenture that occur prior to the maturity date or if the Company delivers a notice of redemption may increase the conversion rate for holders who elect to convert their Convertible Senior Notes in connection with such events should they occur. The Convertible Senior Notes are convertible at the option of the holders at any time prior to the close of business on the business day immediately preceding December 15, 2025, only under the following circumstances: • during any calendar quarter ending after June 30, 2021, if our closing stock price is greater than or equal to 130% of the conversion price on each of at least 20 trading days (whether or not consecutive) of the last 30 consecutive trading days of the immediately preceding calendar quarter; • during the five business day period after any 10 consecutive trading day period in which the trading price (as defined in the Indenture) is less than 98% of the product of the closing price of our common stock and the conversion rate for the Notes on each such trading day; • if the Company calls such Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date, but only with respect to the Notes called (or deemed called) for redemption; and • upon the occurrence of specified corporate events as set forth in the Indenture. On or after December 15, 2025 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders of the Convertible Senior Notes may convert all or any portion of their Convertible Senior Notes at any time, regardless of the circumstances applicable to conversions prior to December 15, 2025. We may not redeem the Convertible Senior Notes prior to March 20, 2024. On or after March 20, 2024, the Convertible Senior Notes are redeemable for cash, in whole or in part (subject to minimum redemption amounts), at our option at any time, and from time to time, if the last reported sale price of the common stock has been at least 130% of the conversion price for the Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the Convertible Senior Notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the redemption date. If the Company redeems less than all the outstanding Convertible Senior Notes, at least $150 million aggregate principal amount of Convertible Senior Notes must be outstanding and not subject to redemption as of the date of the relevant notice of redemption. No sinking fund is provided for the Convertible Senior Notes. If the Company undergoes a fundamental change (as defined in the Indenture), holders may require, subject to certain exceptions, the Company to repurchase for cash all or any portion of their Convertible Senior Notes at a fundamental change repurchase price equal to 100% of the principal amount of the Convertible Senior Notes to be repurchased, plus accrued and unpaid special interest, if any, to, but excluding, the fundamental change repurchase date. The Indenture includes customary covenants and events of default after which the Convertible Senior Notes may be declared immediately due and payable. In accounting for the issuance of the Convertible Senior Notes, we performed an assessment of all of the embedded features of the debt instrument to determine if any will impact the initial measurement of the liability. The Company concluded that the embedded features are not required to be accounted for separately as embedded derivatives, and therefore the Convertible Senior Notes were accounted for in their entirety as a liability equal to the proceeds received from issuance net of debt issuance and offering costs. The Company will amortize debt issuance and offering costs over the term of the Convertible Senior Notes as additional non-cash interest expense utilizing the effective interest method. Capped Call Transactions In connection with the pricing of the Convertible Senior Notes, the Company entered into convertible note hedge transactions (the “capped call transactions”) with six initial purchasers or their respective affiliates and other financial institutions (the “option counterparties”) of $123.6 million concurrent to mitigate the impact of potential economic dilution to our common stock upon conversion of the Convertible Senior Notes and have an initial strike price of approximately $79.16 per share, which corresponds to the initial conversion price of the Convertible Senior Notes. The capped call transactions cover, subject to customary adjustments, the number of shares of common stock initially underlying the Convertible Senior Notes. The capped call transactions are expected to offset the potential dilution to the Company’s common stock upon any conversion of Convertible Senior Notes, with such reduction and/or offset subject to a cap initially equal to $138.8750 per share. The capped call transactions will expire on March 12, 2026. The capped call transactions are separate transactions and are not part of the terms of the Convertible Senior Notes. The shares related to the capped call transactions are excluded from the calculation of diluted earnings per share as they are anti-dilutive. The capped call transactions cover, subject to anti-dilution adjustments, approximately 11,622,176 million shares of the Company’s common stock, par value $0.001. The capped call transactions are subject to either adjustment or termination upon the occurrence of specified extraordinary and disruption events affecting the Company The capped call transactions are purchased call options on our own stock that settle by reference to our own stock with no forced cash payment; therefore, the transactions are classified as an equity instrument and recorded within stockholders’ equity. These transactions are not accounted for as derivatives. The Company recorded the capped call transactions as a reduction to additional paid-in capital and will not be remeasured as long as the conditions for equity classification continue to met. The Convertible Senior Notes and capped call transactions consisted of the following balances reported in the Consolidated Balance Sheet as of March 31, 2021 ($ in millions): March 31, 2021 Liability component: Principal 920.0 Less: debt issuance costs, net of amortization 21.9 Net carrying amount 898.1 Equity component recorded at issuance: Capped call transactions 123.6 The following table sets forth the debt issuance and offering costs recognized in interest expense, net on the consolidated statements of operations related to the Convertible Senior Notes for the three-months ended March 31, 2021 ($ in millions): March 31, 2021 Debt issuance costs 22.1 Amortization of debt issuance costs 0.2 Debt issuance costs, net of amortization 21.9 Effective interest rate of the liability component 0.49 % |
Income Tax
Income Tax | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Income Tax | NOTE 11. INCOME TAX The most significant impact to the Company’s effective tax rate is related to the tax treatment of certain equity compensation. However, the Company continues to be in a net operating loss and deferred tax asset position. As a result, and in accordance with accounting standards, the Company recorded a valuation allowance to reduce the value of the net deferred tax assets to zero. The Company’s effective tax rate for the three-months ended March 31, 2021 and 2020 was 0.0%. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Stockholders Equity [Line Items] | |
Stockholders' Equity | NOTE 12. STOCKHOLDERS’ EQUITY Common Stock In connection with the IPO, we increased our authorized shares from 1,000 to 500,000,000 shares of our common stock, par value of $0.001. Additionally, upon completion of our IPO in August 2020, we sold 17,968,750 shares of common stock at an offering price of $21.00 per share, including 2,343,750 shares of common stock issued pursuant to the exercise in full of the underwriters’ option to purchase additional shares. Redeemable Investor Units, Profits Interests and Incentive Units All shares of redeemable investor units outstanding at the time of the IPO, totaling 12,472,242 units and undeclared and deemed dividends of $103.6 million, were converted into 184,787,783 shares of common stock and their carrying value, totaling $545.0 million was reclassified into stockholders’ equity on our condensed consolidated balance sheets in conjunction with the completed IPO. No shares of redeemable convertible preferred stock were issued or outstanding as of March 31, 2021 or December 31, 2020. Additionally, all shares of profits interests then outstanding, totaling 3,456,634 units were converted into 38,111,001 shares of common stock, 22,612,472 of which were considered RSAs at the time of conversion. The carrying value of $7.0 million was reclassified into common stock and additional paid in capital on our consolidated balance sheet. No profits interests or incentive units were issued or outstanding as of March 31, 2021 or December 31, 2020. Preferred Stock Also, in connection with our IPO, we authorized the issuance of 50,000,000 shares of our preferred stock, par value $0.001. There was no preferred stock outstanding as of March 31, 2021. |
Stock And Unit-Based Compensati
Stock And Unit-Based Compensation | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Stock and Unit-Based Compensation | NOTE 13. STOCK AND UNIT-BASED COMPENSATION 2020 Omnibus Incentive Plan On August 5, 2020, the Company’s Board of Directors adopted the 2020 Omnibus Incentive Plan (the “2020 Plan,”). Under the 2020 Plan, employees, consultants and directors of our company and our affiliates that perform services for us are eligible to receive awards. The 2020 Plan provides for the grant of incentive stock options (“ISOs”), non-statutory stock options (“NSOs”), stock appreciation rights, RSAs, performance awards, other share-based awards (including restricted stock units (“RSUs”)) and other cash-based awards. The maximum number of shares available for issuance under the 2020 Plan may not exceed 48,138,967 shares (subject to annual increases as approved by the Board of Directors). Stock Options Activity Stock options granted by the Company generally vest over four years with 25% of the option shares vesting each year. Options generally expire ten years from the date of the grant. The following is a summary of stock option activity transactions as of and for the three-months ended March 31, 2021 ($ in millions): Number of Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding, December 31, 2020 14,958,969 $ 21.01 9.60 $ 600.6 Granted 305,505 59.63 Exercised (53,307 ) 21.00 Cancelled (25,582 ) 21.07 Outstanding, March 31, 2021 15,185,585 $ 21.79 9.36 $ 494.9 Options exercisable as of March 31, 2021 2,375,304 $ 21.00 9.35 $ 79.0 The aggregate intrinsic value of options exercised in the three-months ended March 31, 2021 and 2020 was $1.8 million and $0.0 million, respectively. Aggregate intrinsic value represents the difference between the exercise price of the option and the closing price of the Company’s common stock on the date of exercise. The fair value of options granted for the three-months ended March 31, 2021 and 2020 was $8.8 million and $0.0 million, respectively. RSA Activity The RSAs were granted as part of the pre-IPO conversion (see Note 12). The following is a summary of RSA transactions as of and for the three-months ended March 31, 2021: Unvested Shares Grant Date Fair Value Unvested, December 31, 2020 21,599,118 $ 11.77 Granted - - Vested (1,701,267 ) 1.50 Canceled and forfeited (43,447 ) 14.05 Unvested, March 31, 2021 19,854,404 $ 12.65 RSU Activity RSUs granted generally vest over four years. RSUs are accounted for as equity using the fair value method, which requires measurement and recognition of compensation expense for all awards granted to our employees, directors and consultants based upon the grant-date fair value. The following is a summary of RSU transactions as of and for the three-months ended March 31, 2021: Unvested Shares Grant Date Fair Value Unvested, December 31, 2020 216,804 $ 32.21 Granted 182,272 $ 59.63 Vested (17,864 ) 50.46 Canceled and forfeited (6,130 ) 21.52 Unvested, March 31, 2021 375,082 $ 44.84 Employee Stock Purchase Plan On August 5, 2020, the Board of Directors adopted, and the OSH LLC’s and OSH MH LLC’s majority unitholders approved, the 2020 Employee Stock Purchase Plan (the “ESPP”) for the issuance of up to a total of 2,386,875 shares of common stock. In addition, the number of shares available for issuance under the ESPP will be increased annually on January 1 of each calendar year beginning in 2021 and ending in and including 2030, by an amount equal to the lesser of (A) 1% of the shares outstanding on the final day of the immediately preceding calendar year and (B) such smaller number of shares as is determined by our Board of Directors, subject to an increase each January. In no event will more than 30,000,000 shares of our common stock will be available for issuance under the ESPP. Each offering period will be approximately six months in duration commencing on January and July 1 of each year and terminating on June 30 or December 31. The ESPP allows participants to purchase common stock through payroll deductions of up to 15% of their eligible compensation. The purchase price of the shares will be 85% of the lower of the fair market value of our common stock on the grant date or purchase date. As of March 31, 2021, no shares of common stock have been purchased under our ESPP. Stock and Unit-Based Compensation Expense The Company recognized $0.0 million and $1.8 million in unit-based compensation expense related to the profits interests for the three-months ended March 31, 2021 and 2020, respectively. The Company recorded $1.8 million in corporate, general and administrative expenses. The Company recognized $42.3 million and $0.0 million related to RSAs, options and RSUs for the three-months ended March 31, 2021 and 2020, respectively. The Company recorded $41.2 million in corporate, general and administrative expenses, $0.8 million in sales and marketing, and $0.3 million in cost of care. As part of the pre-IPO equity conversion discussed in Note 12, the profits interests that were subject to vesting over a period of continuous employment or service and were unvested upon the conversion were converted into RSAs and options that vest over the remaining requisite service period from the original grant dates. The unvested profits interests that were subject to vesting upon the “Sponsor’s Exit” performance condition were converted into RSAs and options that cliff vest between two years post IPO and four years from the original grant dates. A Sponsor's Exit is defined to occur if either (1) a Sponsor sells down to one or more third parties their direct or indirect equity investment in OSH LLC to less than 20% of the units owned by such sponsor, or (2) a sale, transfer or other disposition of all or substantially all of the assets of OSH LLC to one or more third parties. As a result of this conversion and modification of vesting terms from Sponsor’s Exit to service-based vesting at the IPO, the Company determined that RSAs and options should be accounted for as a Type III modification (the award was not probable to vest prior to the modification but it was probable of vesting under the modified condition). The stock compensation expense, net of forfeitures, recorded for these modifications was $29.3 million for the three-months ended March 31, 2021. As of March 31, 2021, the Company had approximately $251.1 million in unrecognized compensation expense related to all non-vested awards (RSAs, options and RSUs) that will be recognized over the weighted-average period of 1.49 years. Valuation of Stock Options The grant date fair value of stock options that were granted post-IPO was estimated using a Black-Scholes option-pricing model with the following assumptions: March 31, 2021 Risk-free interest rate 0.79 % Volatility 50.00 % Expected term to expiration (years) 6.25 Expected dividend yield 0.00 % Estimated fair value $ 28.69 The determination of fair value of stock options on the date of grant using a Black-Scholes option-pricing model is affected by the estimated fair value of the Company’s common stock as well as assumptions regarding a number of variables that are complex, subjective and generally require significant judgement to determine. The valuation assumptions were determined as follows: Fair Value of Common Stock The fair value of the Company’s common stock is determined by the closing price, on the date before the grant, of its common stock, which is traded on the NYSE. Expected Term We determine the expected term of awards using the simplified method which is used when there is insufficient historical data about exercise patterns and post-vesting employment termination behavior. The simplified method is based on the vesting period and the contractual term for each grant, or for each vesting-tranche for awards with graded vesting. The mid-point between the vesting date and the maximum contractual expiration date is used as the expected term under this method. Expected Volatility We use an average historical stock price volatility of a peer group of comparable publicly traded healthcare companies representative of our expected future stock price volatility, as we do not have sufficient trading history for our common stock. For purposes of identifying these peer companies, we consider the industry, stage of development, size and financial leverage of potential comparable companies. For each grant, we measure historical volatility over a period equivalent to the expected term. Risk-Free Interest Rate The risk-free interest rate is based on the implied yield currently available on U.S. Treasury zero-coupon issues with maturities similar to the expected term of the award. Expected Dividend Yield We have not paid and do not anticipate paying any dividends in the foreseeable future. Accordingly, we estimate the dividend yield to be zero. |
Commitments - Litigation And Co
Commitments - Litigation And Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Commitments Litigation And Contingencies | NOTE 14. COMMITMENTS – LITIGATION AND CONTINGENCIES Contingencies The Company is presently, and from time to time, subject to various claims and lawsuits arising in the normal course of business. In the opinion of management, the ultimate resolution of these matters will not have a material adverse effect on the Company’s financial position or results of operations. Uncertainties The healthcare industry is subject to numerous laws and regulations of federal, state and local governments. These laws and regulations include, but are not limited to, matters such as licensure, accreditation, government healthcare program participation requirements, reimbursement for patient services, and Medicare and Medicaid fraud and abuse. Recently, government activity has increased with respect to investigations and allegations concerning possible violations of fraud and abuse statues and regulations by healthcare providers. Violations of these laws and regulations could result in expulsion from government healthcare programs together with imposition of significant fines and penalties, as well as significant repayments for patient services billed. Management believes that the Company is in compliance with fraud and abuse as well as other applicable government laws and regulations. While no regulatory inquiries have been made, compliance with such laws and regulations is subject to government review and interpretation, as well as regulatory actions unknown at this time. |
Variable Interest Entities
Variable Interest Entities | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Variable Interest Entities | NOTE 15. VARIABLE INTEREST ENTITIES The Physician Groups (as defined in Note 1) were established to employ healthcare providers, contract with managed care payors, and to deliver healthcare services to patients in the markets that the Company serves. The Company evaluated whether it has a variable interest in the Physician Groups, whether the Physician Groups are VIEs, and whether the Company has a controlling financial interest in the Physician Groups. The Company concluded that it has variable interests in the Physician Groups on the basis of its Administrative Service Agreement (“ASA”) which provides for reimbursement of costs and a management fee payable to the Company from the Physician Groups in exchange for providing management and administrative services which creates risks and a potential return to the Company. The Physician Group’s equity at risk, as defined by U.S. GAAP, is insufficient to finance its activities without additional support, and, therefore, the Physician Groups are considered VIEs. In order to determine whether the Company has The table below illustrates the VIE assets and liabilities and performance for the Physician Groups as of and for the periods ended ($ in millions): March 31, 2021 December 31, 2020 Total assets $ 394.2 $ 286.1 Total liabilities 337.7 332.1 For the Three-Months Ended March 31, 2021 March 31, 2020 Total revenues $ 294.3 $ 198.5 Medical claims expense 198.9 131.4 Cost of care 32.9 15.3 Total operating expenses $ 231.7 $ 146.7 Physician Group revenues consist of amounts recognized for services provided to patients and includes capitated revenue and a portion of the Company’s other patient service revenue and exclude certain care management services. All capitation arrangements are executed at the Physician Group level. Operating expenses consist primarily of medical claims expense, a majority of which are third-party medical claims expenses and administrative health plan fees and exclude fees to perform payor delegated activities and provider excess insurance costs. Cost of care, excluding depreciation and amortization primarily include provider salaries and benefits and other clinical operating costs which are reported in cost of care, excluding depreciation and amortization in the consolidated statements of operations. These amounts do not include intercompany revenues and costs, principally management fees between MSO and the Physician Groups, which are eliminated in consolidation. There are no restrictions on the Physician Groups’ assets or on the settlement of its liabilities. The assets of the Physician Groups can be used to settle obligations of the Company. The Physician Groups are included in the Company’s obligated group; thus, creditors of the Company have recourse to the assets owned by the Physician Groups. There are no liabilities for which creditors of the Physician Groups do not have recourse to the general credit of the Company. There are no restrictions placed on the retained earnings or net income of the Physician Groups with respect to potential dividend payments. |
Related Parties
Related Parties | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Related Parties | NOTE 16. RELATED PARTIES Humana Revenues Humana holds over 5% of our common stock and has entered into a Director Nomination Agreement with the Company. The Company has capitated managed care contracts with Humana. Total capitated revenues related to the Humana payor contracts were $121.4 million and $96.5 million for the three-months ended March 31, 2021 and 2020, respectively. Receivables from Humana represented $87.2 million and $65.7 million of the capitated accounts receivable balance at March 31, 2021 and December 31, 2020, respectively. Within the Company’s other patient services revenue, revenues from Humana are included in both fee-for-service revenue and care coordination revenue. The Company had recognized $0.1 million in other patient service revenue in the three-months ended March 31, 2021 and 2020, related to the fee-for-service revenues. The Company had recognized $1.1 million and $0.7 million in other patient service revenue in the three-months ended March 31, 2021 and 2020, respectively, related to the Care Coordination arrangements. Receivables from Humana represented $0.1 million and $0.0 million of the other accounts receivable balance at March 31, 2021 and December 31, 2020, respectively, which is all related to fee-for-service arrangements. The unearned portion of the Care Coordination Payments was recorded as contract liabilities in both the short term and long-term other liabilities accounts. The liability related to Humana Care Coordination Payments represented $4.1 million and $2.6 million of the other current liabilities and $14.1 million and $5.0 million of the other long-term liabilities’ balances at March 31, 2021 and December 31, 2020, respectively. Expenses Total medical claims expenses related to the Humana payor contracts were $73.0 million and $59.8 million in the three-months ended March 31, 2021 and 2020, respectively. Unpaid claims related to Humana capitated contracts represented $78.8 million and $78.5 million of the liability for unpaid claims balance at March 31, 2021 and December 31, 2020, respectively. The Humana Alliance Provision contains an arrangement for a license fee that is payable by the Company to Humana for the Company’s provision of health care services in certain centers owned or leased by Humana. The license fee is a reimbursement to Humana for its costs of owning or leasing and maintaining the centers, including rental payments, center maintenance or repair expenses, equipment expenses, special assessments, cost of upgrades, taxes, leasehold improvements, and other expenses identified by Humana. The total license fees paid to Humana during the three-months ended March 31, 2021 and 2020 were $0.7 million and are included in cost of care expenses in the consolidated statement of operations. The liability was recorded in both the short term and long-term other liabilities accounts. The liability for the Humana license fee represented $2.7 million and $0.6 million of the other current liabilities and $8.4 million and $7.3 million of other long-term liabilities balance at March 31, 2021 and December 31, 2020, respectively. The Company has entered into certain lease arrangements with Humana, which accounted for approximately $1.3 million and $0.5 million of the total operating lease rental payments within the cost of care line item for the three-months ended March 31, 2021 and 2020, respectively. The deferred rent liability related to Humana leases represented $0.0 million and $0.8 Blue Cross Blue Shield of Rhode Island Blue Cross Blue Shield of Rhode Island (“BCBSRI”) owns 49.9% of our joint venture, OSH-RI, LLC, and one of our Board members served as president and CEO of BCBSRI through the year ended December 31, 2020. Total capitated revenue associated with the BCBSRI payor contract was $2.3 million for the three-months ended March 31, 2020. Capitated receivables from BCBSRI represented $10.0 million of the capitated accounts receivable balance at December 31, 2020. Total medical claims expenses related to the BCBSRI payor contract were $1.6 million for the three-months ended March 31, 2020. Unpaid claims related to these capitated contracts represented $11.1 million of the liability for unpaid claims balance at December 31, 2020. Zing Health One of our Board members is an employee of Newlight Partners LP, which is one of our Lead Sponsors, and has a direct interest in Zing Health. The Company entered into a capitated contract with Zing Health during the year ended December 31, 2020. Total capitated revenue associated with the Zing Health payor contract was $1.2 million and $0.6 million for the three-months ended March 31, 2021 and 2020, respectively. Capitated receivables from Zing Health represented $0.8 million and $0.2 million of the capitated accounts receivable balance at March 31, 2021 and December 31, 2020, respectively. Total medical claims expenses related to the Zing Health payor contract was $1.0 million and $0.4 million for the three-months ended March 31, 2021 and 2020, respectively. Unpaid claims related to these capitated contracts represented $1.2 million and $0.7 million of the liability for unpaid claims balances at March 31, 2021 and December 31, 2020, respectively. |
Segment Financial Information
Segment Financial Information | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Segment Financial Information | NOTE 17. SEGMENT FINANCIAL INFORMATION The Company’s chief operating decision maker (“CODM”) regularly reviews financial operating results on a consolidated basis for purposes of allocating resources and evaluating financial performance. The Company also identified its operating segments based on the responsibility of its CODM and where we operate. We report a single operating segment, which is to care for our patients’ needs. Although the Company derives its revenues from several different geographic regions, the Company neither allocates resources based on the operating results from the individual regions, nor manages each individual region as a separate business unit. The Company’s CODM manages the operations on a consolidated basis to make decisions about overall corporate resource allocation and to assess overall corporate profitability. |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | NOTE 18. NET LOSS PER SHARE The following table sets forth the computation of basic and diluted net loss per common share for the three-months ended March 31, 2021: Three-months ended March 31, 2021 Numerator: Net loss $ (64.0 ) Less: Net loss attributable to non-controlling interests (0.6 ) Net loss attributable to OSH Inc. stockholders (63.4 ) Denominator: Weighted average common stock outstanding - basic and diluted 220,736,845 Net loss per share – basic and diluted $ (0.29 ) The Company’s potentially dilutive securities, which included stock options, unvested RSUs, unvested RSAs and securities associated with our Convertible Senior Notes have been excluded from the computation of diluted net loss per share as the effect would reduce the net loss per share. Therefore, the weighted average number of common shares/units outstanding used to calculate both basic and diluted net loss per share was the same. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share for the periods indicated: Three-months ended March 31, 2021 Stock options 15,185,585 RSUs 375,082 RSAs 19,854,404 Convertible Senior Notes * 11,622,176 47,037,247 *The Company entered into capped call transactions to mitigate the impact of potential economic dilution to our common stock upon any conversion of our Convertible Senior Notes. The capped call transactions are expected to offset the potential dilution to the Company’s common stock upon any conversion of the Convertible Senior Notes up to a cap price of $138.8750 per share. See Note 10 for further details on the capped call transactions. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies - (Policies) - OAK Street Health Inc and Affiliates [Member] | 3 Months Ended |
Mar. 31, 2021 | |
Significant Accounting Policies [Line Items] | |
Initial Public Offering and Reorganization Transactions | Initial Public Offering and Reorganization Transactions On August 10, 2020, we completed our IPO in which we issued and sold 17,968,750 shares of common stock, par value $0.001 per share, at an offering price of $21.00 per share. The share amount included the exercise in full of the underwriters’ options to purchase 2,343,750 additional shares of common stock. We received net proceeds of $351.2 million, after deducting underwriting discounts and commissions of $22.6 million and deferred offering costs of $3.5 million. Deferred, direct offering costs were capitalized and recorded against proceeds from the offering and consisted of fees and expenses incurred in connection with the sale of our common stock in the IPO, including the legal, accounting, printing and other offering related costs. In conjunction with the IPO, OSH LLC completed a series of transactions that resulted in Oak Street Health, Inc. becoming the ultimate parent company of OSH LLC and subsidiaries. Additionally, immediately prior to the closing of the IPO, unitholders of OSH LLC exchanged their membership interests for common stock in Oak Street Health, Inc. as part of the related IPO reorganization transactions. All 15,928,876 units of our then outstanding redeemable investor units (preferred stock including their respective undeclared and deemed dividends) and members’ capital (former founders’ units and incentive units/profits interests) plus 1,924 of options to purchase incentive units were converted into 200,286,312 shares of common stock of the Company and 22,612,472 shares of restricted common stock subject to service-based vesting (“RSA”) of the Company. |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The accompanying unaudited interim consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been omitted pursuant to such regulations. These financial statements have been prepared on a basis consistent with the accounting principles applied for the fiscal year ended December 31, 2020 in the Company’s Form 10-K filed with the SEC. In the opinion of management, all adjustments (consisting of all normal and recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three-months ended March 31, 2021, including the impact of COVID-19, are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. The consolidated financial statements of the Company include the financial statements of all wholly owned subsidiaries and majority-owned or controlled companies. For those consolidated subsidiaries where our ownership is less than 100%, the portion of the net income or loss allocable to the non-controlling interests is reported as “Net loss (gain) attributable to non-controlling interests” in the consolidated statements of operations. Intercompany balances and transactions have been eliminated in consolidation. The Company evaluates its ownership, contractual and other interests in entities to determine if it has any variable interest in a variable interest entity (“variable interest entities” or “VIEs”). These evaluations are complex, involve judgment and the use of estimates and assumptions based on available historical information, among other factors. The Company considers itself to control an entity if it is the majority owner of or has voting control over such entity. The Company also assesses control through means other than voting rights and determines which business entity is the primary beneficiary of the VIE. The Company consolidates VIEs when it is determined that the Company is the primary beneficiary of the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. Changes in consolidation status are applied prospectively. Upon completion of our IPO, OSH’s sole material asset is its interest in OSH LLC and its affiliates. In accordance with the master structuring agreement dated August 10, 2020, by and among OSH and the other signatories party thereto (the “Master Structuring Agreement”), we have all management powers over the business and affairs of OSH LLC and to conduct, direct and exercise full control over the activities of OSH LLC. Due to our power to control the activities most directly affecting the results of OSH LLC, we are considered the primary beneficiary of the VIE. Accordingly, following the effective date of the IPO, we consolidate the financial results of OSH LLC and its affiliates and the financial statements for the periods prior to the IPO have been adjusted to combine the previously separate entities for presentation purposes. Oak Street Health MSO LLC (“MSO”), a wholly owned subsidiary of OSH LLC, was formed in 2013 to provide a wide range of management services to the Physician Groups (as defined below). Activities include but are not limited to operational support of the centers, marketing, information technology infrastructure and the sourcing and managing of health plan contracts. Oak Street Health Physicians Group PC, OSH-IN Physicians Group PC, OSH-MI Physicians Group PC, OSH-OH Physicians Group LLC, OSH-PA Physicians Group PC, OSH-RI Physicians Group PC, Oak Street Health of Texas, PLLC, Griffin Myers Medical PC, Oak Street Health Physicians Group of South Carolina LLC, Oak Street Health Physicians Group of Louisiana LLC and Oak Street Health Physicians Group of Mississippi LLC (collectively, the “Physician Groups”) employ healthcare providers to deliver primary care services to the Medicare covered population of Illinois, Indiana, Louisiana, Michigan, Mississippi, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas and New York. These entities are consolidated as each are considered variable interest entities where the Company has a controlling financial interest (see Note 15). In addition, Oak Street Health is the majority interest owner in three joint ventures: OSH-PCJ Joliet, LLC, OSH-RI, LLC and OSH-ESC Joint Venture, LLC, which are consolidated in the Company’s financial statements. In March 2021, distributions were made from OSH-PCJ Joliet, LLC to Oak Street Health MSO, LLC (50.1% ownership) and Primary Care Physicians of Joliet (49.9% ownership) totaling $1.1 million to each owner. |
Emerging Growth Company Status | Emerging Growth Company Status We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The JOBS Act provides that an emerging growth company can take advantage of the extended transition period for complying with new or revised accounting standards. We have elected to avail ourselves of this extended transition period and, as a result, we will not adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies until required by private company accounting |
Leases | Leases The Company leases offices, operating facilities, vehicles and IT equipment, which are accounted for as operating leases. These leases have remaining lease terms of up to 30 years, inclusive of renewal or termination options that the Company is reasonably certain to exercise. The Company determines if an arrangement is a lease at inception and evaluates the lease classification (i.e., operating lease or financing lease) at that time. Lease arrangements with an initial term of 12 months or less are considered short-term leases and are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the term of the lease Operating leases are included in operating lease right-of-use assets , operating lease liabilities, current portion (recorded within other current liabilities) and long-term operating lease liabilities The Company uses its incremental borrowing rate on the commencement date for determining the present value of lease payments. The Company considers the likelihood of exercising options to extend or terminate the lease when determining the lease term. The Company has lease agreements with lease and non-lease components. The Company has elected the practical expedient to account for the lease and non-lease components as a single lease component for all leases. |
Convertible Debt | Convertible Debt The Company evaluates all conversion, repurchase and redemption features contained in a debt instrument to determine if there are any embedded features that require bifurcation as a derivative. In accounting for the issuance of the 0% Convertible Senior Notes due 2026 issued in March 2021 (the “Convertible Senior Notes”), the Company |
Capped Call Transactions | Capped Call Transactions In connection with the issuance of the Convertible Senior Notes, the Company entered into capped call transactions. The capped call transactions are expected generally to reduce the potential dilution to the holders of the Company’s common stock upon any conversion of the Convertible Senior Notes. T |
Net Income (Loss) Per Share | Net Income (Loss) Per Share The diluted net income (loss) per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period determined using the treasury stock method or the if-converted method, as appropriate. For purposes of this calculation, stock options, restricted stock units, restricted stock awards and contingently issuable shares under our Convertible Senior Notes are considered common stock equivalents but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as their effect is anti-dilutive. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In 2016, the FASB issued guidance on leases, Accounting Standards Updates 2016-02, Leases (“ASU 2016-02), with amendments issued in 2018 and 2019 (collectively, “ASC 842”). ASC 842 requires lessees to recognize assets and liabilities related to lease arrangements on the balance sheet; leases are to be recorded as a lease liability (on a discounted basis) with a corresponding right-of-use (“ROU”) asset. Leases will be classified as finance or operating, with the classification affecting the pattern and classification of expense recognition over the lease term. The recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous GAAP. This guidance also expands the required quantitative and qualitative disclosures for leasing arrangements and gives rise to other changes impacting certain aspects of lessee and lessor accounting. The two permitted transition methods under the guidance are the modified retrospective transition approach, which requires application of the guidance for all comparative periods, and the cumulative effect adjustment approach, which requires prospective application the adoption date. We adopted ASC 842 as of January 1, 2021 on a prospective basis, did not adjust the comparative reporting periods and applied the lessee package of practical expedients. The package of practical expedients included that the Company was not required to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. Also, as part of the adoption, the Company elected to not recognize short-term leases (those with lease terms less than a year) on the consolidated balance sheets, not separate lease and non-lease components and did not use hindsight to determine lease term. The most significant impact was the recognition of ROU assets and lease liabilities for our operating leases. The ROU assets represent the right to use an underlying asset for the lease term, and lease liabilities represent an obligation to make lease payments arising from the lease at lease commencement date. The Company’s operating leases resulted in the recognition of additional assets and the corresponding liabilities on its consolidated balance sheets, however it did not have a material impact on the consolidated statements of operations or cash flows for the three- months ended March 31, 2021. The Company recognized ROU assets and lease liabilities for operating leases of $108.1 million and $126.8 million, respectively, upon adoption as of January 1, 2021. The difference between the lease liability and right-of-use asset mainly related to the reversal of existing deferred rent balances. The Company utilized a comprehensive approach to assess the impact of this guidance on the consolidated financial statements and related disclosures, including the increase in assets and liabilities on the consolidated balance sheets and the impact on the current lease portfolio. See Note 7 in this Quarterly Report for our lease accounting policy and the quarterly impact of our adoption of ASC 842. In August 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-06 Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity Among other changes, ASU 2020-06 removes the liability and equity separation model for convertible instruments with a cash conversion feature, and as a result, after adoption, entities will no longer separately present in equity an embedded conversion feature for such debt. Similarly, the embedded conversion feature will no longer be amortized into income as interest expense over the life of the instrument. Instead, entities will account for a convertible debt instrument wholly as debt unless (1) a convertible instrument contains features that require bifurcation as a derivative under ASC Topic 815, Derivatives and Hedging , or (2) a convertible debt instrument was issued at a substantial premium. Additionally, ASU 2020-06 requires the application of the if-converted method to calculate the impact of convertible instruments on diluted earnings per share and updates the disclosure requirements in ASC 470-20, making them easier to understand for financial statement preparers and improving the decision-usefulness and relevance of the information for financial statement users. Convertible Senior Notes, In December 2019, the FASB issued ASU 2019-12, “Income Taxes Topic 740-Simplifying the Accounting for Income Taxes” (“ASU 2019-12”), which intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application of ASC 740. This guidance is effective for fiscal years beginning after December 15, 2020, including interim periods therein. The Company adopted the new guidance on January 1, 2021, noting no impact on its consolidated financial statements and related disclosures In January 2020, the FASB issued ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (“ASU 2020-01”). |
Recent Accounting Pronouncements Not Yet Adopted | Recent Accounting Pronouncements Not Yet Adopted In October 2018, the FASB issued ASU 2018-17, Consolidation – Targeted Improvements to Related Party Guidance for Variable Interest Entities (Topic 810) In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments We do not expect that any other recently issued accounting guidance will have a significant effect on our consolidated financial statements. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) - OAK Street Health Inc and Affiliates [Member] | 3 Months Ended |
Mar. 31, 2021 | |
Capitated Revenue [Member] | |
Revenue Recognition [Line Items] | |
Summary of Sources of Revenue in Percentage Terms | The Company had agreements in place with the payors listed below and payor sources of capitated revenue for each period presented were as follows: For the Three-Months Ended March 31, 2021 March 31, 2020 Humana 42 % 49 % Wellcare/Meridian 18 % 14 % Cigna-HealthSpring 10 % 11 % Other 30 % 26 % |
Other Patient Service Revenue [Member] | |
Revenue Recognition [Line Items] | |
Summary of Sources of Revenue in Percentage Terms | Other patient service revenue is comprised of ancillary fees earned under contracts with certain managed care organizations for the provision of certain care coordination services and care management services and is also comprised of fee-for-service revenue. The composition of other patient service revenue for each period was as follows ($ in millions): For the Three-Months Ended March 31, 2021 March 31, 2020 Care coordination and care management $ 3.9 $ 4.1 Fee for service 1.6 1.1 Total other patient service revenue $ 5.5 $ 5.2 |
Fee-For-Service [Member] | |
Revenue Recognition [Line Items] | |
Summary of Sources of Revenue in Percentage Terms | The fee-for-service revenue by payor source for each period presented were as follows: For the Three-Months Ended March 31, 2021 March 31, 2020 Medicare 38 % 46 % Humana 11 % 8 % Other 51 % 46 % |
Property And Equipment (Tables)
Property And Equipment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
OAK Street Health Inc and Affiliates [Member] | |
Property, Plant and Equipment [Line Items] | |
Summary of Property Plant and Equipment | Property and equipment consisted of the following as of March 31, 2021 and December 31, 2020 ($ in millions): March 31, 2021 December 31, 2020 Leasehold improvements $ 67.5 $ 63.6 Furniture and fixtures 5.1 4.9 Computer equipment 20.6 17.8 Internal use software 7.7 6.1 Office equipment 9.9 9.7 Construction in process 4.0 4.2 Total, at cost 114.8 106.3 Less accumulated depreciation (30.7 ) (27.5 ) Property and equipment, net $ 84.1 $ 78.8 |
Leases (Tables)
Leases (Tables) - OAK Street Health Inc and Affiliates [Member] | 3 Months Ended |
Mar. 31, 2021 | |
Schedule of Components of Lease Expense | The components of lease expense for the Company’s operating leases were as follows for the three-months ended March 31, 2021 ($ in millions): March 31, 2021 Operating lease cost $ 4.5 Variable lease cost 4.9 Total lease cost $ 9.4 |
Schedule of Minimum Lease Payments for Operating Leases | The table below presents the future minimum lease payments under the noncancelable operating leases as of March 31, 2021 ($ in millions): 2021 $ 13.7 2022 17.7 2023 16.3 2024 14.7 2025 13.9 2026 13.7 Thereafter 75.4 Total lease payments $ 165.4 Less: imputed interest (34.0 ) Total operating lease liabilities $ 131.4 Reported as: Operating lease liabilities, current (1) 13.1 Operating lease liabilities, noncurrent 118.3 Total operating lease liabilities $ 131.4 (1) Included in other liabilities on the consolidated balance sheet |
Schedule Of Lessee Operating Lease Weighted Average Remaining Lease Term And Weighted Average Discount Rate | The weighted-average remaining lease term and discount rate for operating lease liabilities included in the consolidated balance sheets are as follows: March 31, 2021 Weighted-average remaining lease term (in years) 10.6 Weighted-average discount rate 4.07 % |
Other Current And Long-Term L_2
Other Current And Long-Term Liabilities (Tables) - OAK Street Health Inc and Affiliates [Member] | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities [Line Items] | |
Summary of Accrued Liabilities | Accrued compensation and benefits consisted of the following as of ($ in millions): March 31, 2021 December 31, 2020 Accrued paid time off $ 6.1 $ 5.0 Accrued bonus and commission 20.9 19.1 Employee stock purchase plan contributions 1.4 - Accrued payroll and taxes 5.7 1.8 CARES Act deferred payroll taxes 3.5 3.5 Other 1.6 2.6 $ 39.2 $ 32.0 |
Summary of Other Current Liabilities | Other current liabilities consisted of the following as of ($ in millions): March 31, 2021 December 31, 2020 Humana license fee $ 2.7 $ 0.6 Operating lease liabilities 13.1 - Contract liabilities, current 4.4 4.3 Accrual for goods or services received, not invoiced 4.5 3.6 CARES Act Medicare advances & Provider Relief Funds 3.1 2.3 Other current liabilities 2.5 1.8 $ 30.3 $ 12.6 |
Summary of Other Noncurrent Liabilities | Other long-term liabilities consisted of the following as of ($ in millions): March 31, 2021 December 31, 2020 Humana license fee, net of current $ 8.4 $ 7.3 Contract liabilities, net of current 14.1 12.8 Lease incentive obligation, net of current - 5.1 CARES Act deferred payroll taxes 3.5 3.5 Other long-term liabilities 0.0 0.1 $ 26.0 $ 28.8 |
Liability For Unpaid Claims (Ta
Liability For Unpaid Claims (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Roll Forward In Liability For Unpaid Claims And Claims Adjustment Expense [Abstract] | |
Summary of Liability for Unpaid Claims and Claims Adjustment Expense | Activity within liabilities for unpaid claims was as follows for the three-months ended March 31, 2021 and 2020 ($ in millions): March 31, 2021 March 31, 2020 Balance, beginning of period $ 262.1 $ 170.6 Incurred health care costs: Current year 192.3 131.4 Prior years 6.6 - Total claims incurred $ 198.9 $ 131.4 Claims paid: Current year (20.6 ) (59.7 ) Prior years (165.5 ) (30.5 ) Total claims paid $ (186.1 ) $ (90.2 ) Adjustments to other claims-related liabilities (0.3 ) (0.2 ) Balance, end of period $ 274.6 $ 211.6 |
Long- Term Debt (Tables)
Long- Term Debt (Tables) - OAK Street Health Inc and Affiliates [Member] | 3 Months Ended |
Mar. 31, 2021 | |
Summary of Long-term Debt Instruments | The Convertible Senior Notes and capped call transactions consisted of the following balances reported in the Consolidated Balance Sheet as of March 31, 2021 ($ in millions): March 31, 2021 Liability component: Principal 920.0 Less: debt issuance costs, net of amortization 21.9 Net carrying amount 898.1 Equity component recorded at issuance: Capped call transactions 123.6 |
Summary of Debt Issuance Costs | The following table sets forth the debt issuance and offering costs recognized in interest expense, net on the consolidated statements of operations related to the Convertible Senior Notes for the three-months ended March 31, 2021 ($ in millions): March 31, 2021 Debt issuance costs 22.1 Amortization of debt issuance costs 0.2 Debt issuance costs, net of amortization 21.9 Effective interest rate of the liability component 0.49 % |
Stock And Unit-Based Compensa_2
Stock And Unit-Based Compensation (Tables) - OAK Street Health Inc and Affiliates [Member] | 3 Months Ended |
Mar. 31, 2021 | |
Summary of Stock Option Activity | The following is a summary of stock option activity transactions as of and for the three-months ended March 31, 2021 ($ in millions): Number of Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding, December 31, 2020 14,958,969 $ 21.01 9.60 $ 600.6 Granted 305,505 59.63 Exercised (53,307 ) 21.00 Cancelled (25,582 ) 21.07 Outstanding, March 31, 2021 15,185,585 $ 21.79 9.36 $ 494.9 Options exercisable as of March 31, 2021 2,375,304 $ 21.00 9.35 $ 79.0 |
Schedule of Valuation Of Stock Options | The grant date fair value of stock options that were granted post-IPO was estimated using a Black-Scholes option-pricing model with the following assumptions: March 31, 2021 Risk-free interest rate 0.79 % Volatility 50.00 % Expected term to expiration (years) 6.25 Expected dividend yield 0.00 % Estimated fair value $ 28.69 |
Restricted Stock Awards R S A | |
Summary of Restricted Stock Awards (RSA) Activity | The RSAs were granted as part of the pre-IPO conversion (see Note 12). The following is a summary of RSA transactions as of and for the three-months ended March 31, 2021: Unvested Shares Grant Date Fair Value Unvested, December 31, 2020 21,599,118 $ 11.77 Granted - - Vested (1,701,267 ) 1.50 Canceled and forfeited (43,447 ) 14.05 Unvested, March 31, 2021 19,854,404 $ 12.65 |
Restricted Stock Units (RSUs) | |
Summary of Restricted Stock Awards (RSA) Activity | RSUs granted generally vest over four years. RSUs are accounted for as equity using the fair value method, which requires measurement and recognition of compensation expense for all awards granted to our employees, directors and consultants based upon the grant-date fair value. The following is a summary of RSU transactions as of and for the three-months ended March 31, 2021: Unvested Shares Grant Date Fair Value Unvested, December 31, 2020 216,804 $ 32.21 Granted 182,272 $ 59.63 Vested (17,864 ) 50.46 Canceled and forfeited (6,130 ) 21.52 Unvested, March 31, 2021 375,082 $ 44.84 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Summary of VIE Assets and Liabilities and Performance for the Physician Groups | March 31, 2021 December 31, 2020 Total assets $ 394.2 $ 286.1 Total liabilities 337.7 332.1 For the Three-Months Ended March 31, 2021 March 31, 2020 Total revenues $ 294.3 $ 198.5 Medical claims expense 198.9 131.4 Cost of care 32.9 15.3 Total operating expenses $ 231.7 $ 146.7 |
OAK Street Health Inc and Affiliates [Member] | |
Summary of VIE Assets and Liabilities and Performance for the Physician Groups | The table below illustrates the VIE assets and liabilities and performance for the Physician Groups as of and for the periods ended ($ in millions): |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Summary of Basic and Diluted Net Loss Per Common Unit | The following table sets forth the computation of basic and diluted net loss per common share for the three-months ended March 31, 2021: Three-months ended March 31, 2021 Numerator: Net loss $ (64.0 ) Less: Net loss attributable to non-controlling interests (0.6 ) Net loss attributable to OSH Inc. stockholders (63.4 ) Denominator: Weighted average common stock outstanding - basic and diluted 220,736,845 Net loss per share – basic and diluted $ (0.29 ) |
OAK Street Health Inc and Affiliates [Member] | |
Summary of Potential Common Shares Outstanding from the Computation of Diluted Net Loss Per Share/Unit | The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share for the periods indicated: Three-months ended March 31, 2021 Stock options 15,185,585 RSUs 375,082 RSAs 19,854,404 Convertible Senior Notes * 11,622,176 47,037,247 |
Organization and Nature of Bu_2
Organization and Nature of Business - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | Aug. 10, 2020 | Jun. 30, 2021 | Aug. 31, 2020 | Mar. 31, 2018 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 |
Organization And Nature Of Business [Line Items] | |||||||
Organisation incorporated date | Oct. 22, 2019 | ||||||
Common stock, par value | $ 0.001 | ||||||
Number of shares issued upon conversion | 38,111,001 | 12,472,242 | |||||
Other Current Liabilities [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Deferred payroll taxes | $ 7 | ||||||
Other Noncurrent Liabilities [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Deferred payroll taxes | $ 3.5 | ||||||
Oak Street Health MSO, LLC [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Equity method investment ownership percentage | 50.10% | ||||||
Primary Care Physicians of Joliet [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Equity method investment ownership percentage | 49.90% | ||||||
Common Stock Subject To Service-Based Vesting [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Number of shares issued upon conversion | 22,612,472 | ||||||
OAK Street Health Inc and Affiliates [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Common stock, par value | $ 0.001 | $ 0.001 | |||||
Proceeds from issuance of initial public offering | $ 351.2 | ||||||
Payments for underwriting expense | 22.6 | ||||||
Deferred offering costs | $ 3.5 | ||||||
Number of units converted | 15,928,876 | ||||||
Number of shares issued upon conversion | 200,286,312 | ||||||
Total distribution from joint venture | $ 1.1 | ||||||
OAK Street Health Inc and Affiliates [Member] | CARES Act [Member] | Medicare Accelerated Advanced Payment Scheme [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Percentage of interest free loans received | 100.00% | ||||||
Period after mediclaim issue when advance payments will begin | 1 year | ||||||
Period after mediclaim issue when advance payments are due | 11 months | ||||||
Proceeds from short term debt | $ 1.5 | ||||||
OAK Street Health Inc and Affiliates [Member] | CARES Act [Member] | Medicare Accelerated Advanced Payment Scheme [Member] | Repayment Period One [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Recoupment percentage of medicare payments | 25.00% | ||||||
OAK Street Health Inc and Affiliates [Member] | CARES Act [Member] | Medicare Accelerated Advanced Payment Scheme [Member] | Repayment Period Two [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Recoupment percentage of medicare payments | 50.00% | ||||||
OAK Street Health Inc and Affiliates [Member] | Grant [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Grants received | $ 2.6 | $ 0 | |||||
OAK Street Health Inc and Affiliates [Member] | Cost of Care [Member] | Grant [Member] | CARES Act [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Grants received | $ 1.9 | $ 0 | |||||
OAK Street Health Inc and Affiliates [Member] | Other Current Liabilities [Member] | Grant [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Grants received | $ 1.6 | ||||||
OAK Street Health Inc and Affiliates [Member] | Revenue Benchmark [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Concentration risk percentage | 98.00% | ||||||
OAK Street Health Inc and Affiliates [Member] | Common Stock Option To Purchase [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Number of units converted | 1,924 | ||||||
OAK Street Health Inc and Affiliates [Member] | Common Stock Subject To Service-Based Vesting [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Number of shares issued upon conversion | 22,612,472 | ||||||
IPO [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Stock issued during period shares | 17,968,750 | ||||||
Shares offering, price per share | $ 21 | ||||||
IPO [Member] | OAK Street Health Inc and Affiliates [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Stock issued during period shares | 17,968,750 | ||||||
Common stock, par value | $ 0.001 | ||||||
Shares offering, price per share | $ 21 | ||||||
Over-Allotment Option [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Stock issued during period shares | 2,343,750 | ||||||
Over-Allotment Option [Member] | OAK Street Health Inc and Affiliates [Member] | |||||||
Organization And Nature Of Business [Line Items] | |||||||
Stock issued during period shares | 2,343,750 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Detail) | Mar. 31, 2021 |
Significant Accounting Policies [Line Items] | |
Operating lease, Remaining lease term | 30 years |
ASU 2018-09 [Member] | |
Significant Accounting Policies [Line Items] | |
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true |
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 1, 2021 |
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true |
ASU 2018-13 [Member] | |
Significant Accounting Policies [Line Items] | |
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true |
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 1, 2021 |
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Revenue From Contract With Customerline Items [Line Items] | |||
Capitated accounts receivable (Humana comprised $87.2 and $65.7 as of March 31, 2021 and December 31, 2020, respectively) | $ 293.6 | $ 248.9 | |
Cost of care | 3.5 | $ 2.5 | |
Financial Support, Waived Fees [Member] | Cost of Care [Member] | |||
Revenue From Contract With Customerline Items [Line Items] | |||
Revenue offset against cost of care regarding goods and services waived | 1.2 | $ 1.5 | |
Humana [Member] | |||
Revenue From Contract With Customerline Items [Line Items] | |||
Capitated accounts receivable (Humana comprised $87.2 and $65.7 as of March 31, 2021 and December 31, 2020, respectively) | 87.2 | 65.7 | |
Contract With Customer Liability | $ 18.2 | $ 16.6 | |
Medicare Part D [Member] | Medical Claims Expenditure [Member] | |||
Revenue From Contract With Customerline Items [Line Items] | |||
Concentration risk percentage | 3.00% | 4.00% | |
Medicare Part D [Member] | Capitated Revenue [Member] | |||
Revenue From Contract With Customerline Items [Line Items] | |||
Concentration risk percentage | 2.00% | 2.00% | |
Accounting Standards Update 2014-09 [Member] | Acuity Adjustment [Member] | |||
Revenue From Contract With Customerline Items [Line Items] | |||
Capitated accounts receivable (Humana comprised $87.2 and $65.7 as of March 31, 2021 and December 31, 2020, respectively) | $ 32.2 | $ 23.5 |
Revenue Recognition - Summary o
Revenue Recognition - Summary of Sources of Capitated Revenue (Detail) - Capitated Revenue [Member] - OAK Street Health Inc and Affiliates [Member] | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Humana [Member] | ||
Disclosure Of Sources Of Revenue In Percentage Terms [Line Items] | ||
Concentration risk percentage | 42.00% | 49.00% |
Wellcare Meridian [Member] | ||
Disclosure Of Sources Of Revenue In Percentage Terms [Line Items] | ||
Concentration risk percentage | 18.00% | 14.00% |
Cigna-HealthSpring [Member] | ||
Disclosure Of Sources Of Revenue In Percentage Terms [Line Items] | ||
Concentration risk percentage | 10.00% | 11.00% |
Other [Member] | ||
Disclosure Of Sources Of Revenue In Percentage Terms [Line Items] | ||
Concentration risk percentage | 30.00% | 26.00% |
Revenue Recognition - Summary_2
Revenue Recognition - Summary of Composition Of Revenues (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation Of Revenue [Line Items] | ||
Performance obligations revenue recognised | $ 296.7 | $ 201.8 |
Other Patient Service Revenue [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Performance obligations revenue recognised | 5.5 | 5.2 |
Other Patient Service Revenue [Member] | Care Coordination And Care Management [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Performance obligations revenue recognised | 3.9 | 4.1 |
Other Patient Service Revenue [Member] | Fee-For-Service [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Performance obligations revenue recognised | $ 1.6 | $ 1.1 |
Revenue Recognition - Summary_3
Revenue Recognition - Summary of Sources of Fee for Service Revenue (Detail) - OAK Street Health Inc and Affiliates [Member] - Fee-For-Service [Member] - Other Patient Service Revenue [Member] | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Medicare [Member] | ||
Disclosure Of Sources Of Revenue In Percentage Terms [Line Items] | ||
Concentration risk percentage | 38.00% | 46.00% |
Humana [Member] | ||
Disclosure Of Sources Of Revenue In Percentage Terms [Line Items] | ||
Concentration risk percentage | 11.00% | 8.00% |
Other [Member] | ||
Disclosure Of Sources Of Revenue In Percentage Terms [Line Items] | ||
Concentration risk percentage | 51.00% | 46.00% |
Fair Value of Financial Measure
Fair Value of Financial Measurement - Additional Information (Detail) - OAK Street Health Inc and Affiliates [Member] - Fair Value, Inputs, Level 2 [Member] $ in Millions | Mar. 31, 2021USD ($) |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Fair value of convertible notes | $ 918.3 |
Carrying value of convertible notes | $ 898.1 |
Property And Equipment - Summar
Property And Equipment - Summary of Property Plant and Equipment (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 114.8 | $ 106.3 |
Less accumulated depreciation | (30.7) | (27.5) |
Property, plant and equipment, net | 84.1 | 78.8 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 67.5 | 63.6 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 5.1 | 4.9 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 20.6 | 17.8 |
Internal Use Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 7.7 | 6.1 |
Office Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 9.9 | 9.7 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 4 | $ 4.2 |
Property And Equipment - Additi
Property And Equipment - Additional Information (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | $ 3.2 | $ 2.4 |
Capitalized development costs expensed | $ 0.3 | $ 0.1 |
Goodwill And Intangible Assets
Goodwill And Intangible Assets - Additional Information (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Jan. 22, 2021 | Dec. 31, 2020 | |
Goodwill and Intangible Assets [Line Items] | ||||
Goodwill | $ 11.4 | $ 9.6 | ||
Net intangible assets | 2.9 | $ 3 | ||
Amortization of intangible assets | $ 0.1 | $ 0.1 | ||
Medical Practice Related Assets [Member] | ||||
Goodwill and Intangible Assets [Line Items] | ||||
Goodwill | $ 1.8 |
Leases - Additional Information
Leases - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Operating lease, Remaining lease term | 30 years | ||
Operating Lease, Right-of-Use Asset | $ 7.6 | ||
Operating lease right-of-use assets (Humana comprised $40.6 and $0.0 as of March 31, 2021 and December 31, 2020, respectively) | $ 0 | ||
Lease and rent expense | 4.6 | ||
Deferred rent expense (Humana comprised $0.0 and $0.8 as of March 31, 2021 and December 31, 2020, respectively) | $ 13.5 | ||
Humana License Fee [Member] | |||
Lease and rent expense | $ 0.9 |
Leases - Summary of Components
Leases - Summary of Components of Lease Expense (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 4.5 |
Variable lease cost | 4.9 |
Total lease cost | $ 9.4 |
Leases - Summary of Weighted Av
Leases - Summary of Weighted Average Remaining Lease Term and Discount Rate (Details) | Mar. 31, 2021 |
Leases [Abstract] | |
Weighted-average remaining lease term (in years) | 10 years 7 months 6 days |
Weighted-average discount rate | 4.07% |
Leases - Summary of Future Mini
Leases - Summary of Future Minimum Lease Payments Under Non Cancelable Operating Leases (Details) $ in Millions | Mar. 31, 2021USD ($) | |
Leases [Abstract] | ||
2021 | $ 13.7 | |
2022 | 17.7 | |
2023 | 16.3 | |
2024 | 14.7 | |
2025 | 13.9 | |
2026 | 13.7 | |
Thereafter | 75.4 | |
Total lease payments | 165.4 | |
Less: imputed interest | (34) | |
Total operating lease liabilities | 131.4 | |
Operating lease liabilities, current | 13.1 | [1] |
Operating lease liabilities, noncurrent | 118.3 | |
Total operating lease liabilities | $ 131.4 | |
[1] | Included in other liabilities on the consolidated balance sheet |
Other Current And Long -Term Li
Other Current And Long -Term Liabilities - Summary of Accrued Liabilities (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Other Liabilities [Line Items] | ||
Accrued paid time off | $ 6.1 | $ 5 |
Accrued bonus and commission | 20.9 | 19.1 |
Employee stock purchase plan contributions | 1.4 | |
Accrued payroll and taxes | 5.7 | 1.8 |
CARES Act deferred payroll taxes | 3.5 | 3.5 |
Other | 1.6 | 2.6 |
Total | $ 39.2 | $ 32 |
Other Current And Long -Term _2
Other Current And Long -Term Liabilities - Summary of Other Current Liabilities (Detail) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Other Liabilities [Line Items] | ||
Total operating lease liabilities | $ 131.4 | |
OAK Street Health Inc and Affiliates [Member] | ||
Other Liabilities [Line Items] | ||
Humana license fee | 2.7 | $ 0.6 |
Total operating lease liabilities | 13.1 | |
Contract liabilities, current | 4.4 | 4.3 |
Accrual for goods or services received, not invoiced | 4.5 | 3.6 |
CARES Act Medicare advances & Provider Relief Funds | 3.1 | 2.3 |
Other current liabilities | 2.5 | 1.8 |
Total | $ 30.3 | $ 12.6 |
Other Current And Long -Term _3
Other Current And Long -Term Liabilities - Summary of Other Noncurrent Liabilities (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Humana license fee, net of current | $ 8.4 | $ 7.3 |
Contract liabilities, net of current | 14.1 | 12.8 |
Lease incentive obligation, net of current | 5.1 | |
CARES Act deferred payroll taxes | 3.5 | 3.5 |
Other long-term liabilities | 0 | 0.1 |
Total | $ 26 | $ 28.8 |
Liability For Unpaid Claims- Ad
Liability For Unpaid Claims- Additional Information (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Liability For Claims And Claims Adjustment Expense [Line Items] | ||
Mediclaim expenses | $ 186.1 | $ 90.2 |
Earning per share basic and diluted | $ (0.29) | |
Provider Excess Insurance Scheme [Member] | ||
Liability For Claims And Claims Adjustment Expense [Line Items] | ||
Insurance premium expenditure incurred | $ 0.9 | 0.8 |
Insurance premium expenditure reimbursed | 0.4 | $ 0.3 |
Providers excess insurance deductible per member | 0.3 | |
Provider Excess Insurance Scheme [Member] | Maximum [Member] | ||
Liability For Claims And Claims Adjustment Expense [Line Items] | ||
Providers excess insurance deductible per member | $ 5 |
Liability For Unpaid Claims - S
Liability For Unpaid Claims - Summary of Liability for Unpaid Claims and Claims Adjustment Expense (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Balance, beginning of period | $ 262.1 | $ 170.6 |
Incurred health care costs: | ||
Cost of providing patient care in relation to revenue waived | 186.1 | 90.2 |
Total claims incurred | 198.9 | 131.4 |
Claims paid: | ||
Current year | 20.6 | 59.7 |
Prior years | 165.5 | 30.5 |
Adjustments to other claims-related liabilities | (0.3) | (0.2) |
Balance, end of period | 274.6 | 211.6 |
Current year [Member] | ||
Incurred health care costs: | ||
Cost of providing patient care in relation to revenue waived | 192.3 | $ 131.4 |
Prior years [Member] | ||
Incurred health care costs: | ||
Cost of providing patient care in relation to revenue waived | $ 6.6 |
Long- Term Debt - Additional In
Long- Term Debt - Additional Information (Detail) $ / shares in Units, $ in Millions | Mar. 16, 2021USD ($) | Jun. 30, 2021 | Mar. 31, 2021USD ($)Day$ / sharesshares |
Debt Instrument [Line Items] | |||
Capped call transactions expiry date | Mar. 12, 2026 | ||
Number of share subject to anti-dilution adjustments | shares | 11,622,176 | ||
Common stock, par value | $ / shares | $ 0.001 | ||
Notes Payable, Other Payables [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price per share | $ / shares | $ 79.16 | ||
Closing stock price | 130.00% | ||
Consecutive trading days | Day | 10 | ||
Redemption price equal to principal amount | 100.00% | ||
Aggregate principal amount | $ 150 | ||
Capped call transactions | $ 123.6 | ||
Conversion price cap initially equal | $ / shares | $ 138.8750 | ||
Notes Payable, Other Payables [Member] | Maximum [Member] | |||
Debt Instrument [Line Items] | |||
Closing stock price | 130.00% | ||
Notes Payable, Other Payables [Member] | Minimum [Member] | |||
Debt Instrument [Line Items] | |||
Closing stock price | 98.00% | ||
Conversion price trading days | Day | 20 | ||
Consecutive trading days | Day | 30 | ||
OAK Street Health Inc and Affiliates [Member] | |||
Debt Instrument [Line Items] | |||
Debt issuance cost | $ 22.1 | ||
Net proceeds to pay capped call transaction | $ 898.1 | ||
Convertible notes special interest | 0.49% | ||
OAK Street Health Inc and Affiliates [Member] | Notes Payable, Other Payables [Member] | |||
Debt Instrument [Line Items] | |||
Debt instrument face value | $ 920 | ||
Long term debt variable interest rate percentage | 0.00% | ||
Option to purchase additional convertible senior notes | $ 120 | ||
Debt issuance cost | 22.1 | ||
Total proceeds received | 897.9 | ||
Net proceeds to pay capped call transaction | $ 123.6 | ||
Convertible notes unsecured obligation mature date | Mar. 15, 2026 | ||
Convertible notes special interest | 0.50% | ||
Debt instrument frequency of periodic payment | 365 days | ||
OAK Street Health Inc and Affiliates [Member] | Notes Payable, Other Payables [Member] | Notes Payable, Other Payables [Member] | |||
Debt Instrument [Line Items] | |||
Debt instrument frequency of periodic payment | 40 trading-day | ||
Conversion rate | 12.6328 | ||
Debt conversion principal amount | $ 1,000 | ||
Conversion price per share | $ / shares | $ 79.16 | ||
OAK Street Health Inc and Affiliates [Member] | Notes Payable, Other Payables [Member] | Maximum [Member] | Notes Payable, Other Payables [Member] | |||
Debt Instrument [Line Items] | |||
Number of shares issuable subject to increase in conversion rate | shares | 16,561,656 |
Long- Term Debt - Summary of Lo
Long- Term Debt - Summary of Long-term Debt Instruments (Detail) - OAK Street Health Inc and Affiliates [Member] $ in Millions | Mar. 31, 2021USD ($) |
Principal | $ 920 |
Less: debt issuance costs, net of amortization | 21.9 |
Net carrying amount | 898.1 |
Capped Call Transactions [Member] | |
Capped call transactions | $ 123.6 |
Long- Term Debt - Summary of De
Long- Term Debt - Summary of Debt Issuance Costs (Detail) - OAK Street Health Inc and Affiliates [Member] $ in Millions | Mar. 31, 2021USD ($) |
Schedule Of Debt Issuance Costs [Line Items] | |
Debt issuance cost | $ 22.1 |
Amortization of debt issuance costs | 0.2 |
Debt issuance costs, net of amortization | $ 21.9 |
Effective interest rate of the liability component | 0.49% |
Income Tax - Additional Informa
Income Tax - Additional Information (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Net deferred tax assets | $ 0 | |
Effective income tax rate | 0.00% | 0.00% |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | |||
Aug. 31, 2020 | Mar. 31, 2018 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stockholders Equity [Line Items] | |||||
OSH Inc stockholders' equity par value or stated value per unit | $ 0.001 | ||||
OSH Inc stockholders' equity, shares authorized | 500,000,000 | 1,000 | |||
Number of shares issued upon conversion | 38,111,001 | 12,472,242 | |||
Undeclared and deemed dividends | $ 103.6 | ||||
Conversion of redeemable preferred stock into common stock upon closing of initial public offering | 184,787,783 | ||||
Total carrying value | $ 545 | ||||
Redeemable preferred stock issued | 0 | 0 | |||
Redeemable preferred stock outstanding | 0 | 0 | |||
Number of units converted | 3,456,634 | ||||
Reclassification of members capital | $ 7 | ||||
Number of units issued | 0 | 0 | |||
Number of units outstanding | 0 | 0 | |||
Common Stock Subject To Service-Based Vesting [Member] | |||||
Stockholders Equity [Line Items] | |||||
Number of shares issued upon conversion | 22,612,472 | ||||
IPO [Member] | |||||
Stockholders Equity [Line Items] | |||||
Issuance of common units | 17,968,750 | ||||
Shares offering, price per share | $ 21 | ||||
Preferred stock authorized | 50,000,000 | ||||
Preferred stock, par value | $ 0.001 | ||||
Preferred stock, shares outstanding | 0 | ||||
Over-Allotment Option [Member] | |||||
Stockholders Equity [Line Items] | |||||
Issuance of common units | 2,343,750 |
Stock And Unit-Based Compensa_3
Stock And Unit-Based Compensation- Additional Information (Detail) - USD ($) $ in Millions | Aug. 05, 2020 | Mar. 31, 2021 | Mar. 31, 2020 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Share-based payment award, expiration period | 10 years | ||
Percentage of option vest per year | 25.00% | ||
Aggregate intrinsic value of options exercised | $ 1.8 | $ 0 | |
Fair value of options | 8.8 | 0 | |
Non-vested Awards (RSAs, Options and RSUs) [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized compensation expense | $ 251.1 | ||
Unrecognized compensation expense, period of recognition | 1 year 5 months 26 days | ||
OAK Street Health Inc and Affiliates [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock and Unit-based compensation expense | $ 42.4 | 1.8 | |
OAK Street Health Inc and Affiliates [Member] | General and Administrative Expense | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock and Unit-based compensation expense | 41.2 | ||
OAK Street Health Inc and Affiliates [Member] | Selling and Marketing Expense | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock and Unit-based compensation expense | 0.8 | ||
OAK Street Health Inc and Affiliates [Member] | Cost of Care [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock and Unit-based compensation expense | 0.3 | ||
OAK Street Health Inc and Affiliates [Member] | Profits Interest Award [Member] | General and Administrative Expense | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock and Unit-based compensation expense | 0 | 1.8 | |
OAK Street Health Inc and Affiliates [Member] | Restricted Stock Units (RSUs) | RSAs and Options | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock and Unit-based compensation expense | 42.3 | $ 0 | |
OAK Street Health Inc and Affiliates [Member] | Sponsors Exit Service-based Vesting [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock and Unit-based compensation expense | $ 29.3 | ||
Twenty Twenty Omnibus Incentive Plan [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Share-based payment award, number of shares available for issuance | 48,138,967 | ||
Share-based compensation arrangement by share-based payment award, effective date | Aug. 5, 2020 | ||
Twenty Twenty Employee Stock Purchase Plan [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Share-based payment award, number of shares available for issuance | 2,386,875 | ||
Percentage increase in stock that can potentially occur related to ESPP | 1.00% | ||
Sharebased compensation arrangement by sharebased payment award payroll deduction percentage on employee subscription | 15.00% | ||
Sharebased compensation arrangement by sharebased payment award purchase price percentage applied on lower market price | 85.00% | ||
Twenty Twenty Employee Stock Purchase Plan [Member] | Common Stock [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Purchase of common stock shares | 0 | ||
Twenty Twenty Employee Stock Purchase Plan [Member] | Maximum [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Share-based payment award, number of shares available for issuance | 30,000,000 |
Stock And Unit-Based Compensa_4
Stock And Unit-Based Compensation - Summary of Stock Option Activity (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Weighted Average Exercise Price, Outstanding Beginning Balance | $ 21.01 | |
Weighted Average Exercise Price, Granted | 59.63 | |
Weighted Average Exercise Price, Exercised | 21 | |
Weighted Average Exercise Price, Cancelled | 21.07 | |
Weighted Average Exercise Price, Outstanding Ending Balance | 21.79 | $ 21.01 |
Weighted Average Exercise Price, March 31, 2021 | $ 21 | |
OAK Street Health Inc and Affiliates [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Options, Outstanding Beginning Balance | 14,958,969 | |
Granted | 305,505 | |
Exercised | (53,307) | |
Cancelled | (25,582) | |
Options, Outstanding Ending Balance | 15,185,585 | 14,958,969 |
Options, Exercisable as of March 31,2021 | 2,375,304 | |
Weighted Average Contractual Term Remaining (in years) | 9 years 4 months 9 days | 9 years 7 months 6 days |
Weighted Average Contractual Term Remaining (in years) Exercisable as of March 31, 2021 | 9 years 4 months 6 days | |
Aggregate Intrinsic Value | $ 600.6 | |
Aggregate Intrinsic Value | 494.9 | $ 600.6 |
Aggregate Intrinsic Value, Option Exercisable as of March 31, 2021 | $ 79 |
Stock And Unit-Based Compensa_5
Stock And Unit-Based Compensation - Summary of Restricted Stock Awards (RSA) (Detail) - Restricted Stock Awards R S A | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Beginning balance | shares | 21,599,118 |
Vested | shares | (1,701,267) |
Canceled and forfeited | shares | (43,447) |
Ending balance | shares | 19,854,404 |
Beginning balance | $ / shares | $ 11.77 |
Vested | $ / shares | 1.50 |
Canceled and forfeited | $ / shares | 14.05 |
Ending balance | $ / shares | $ 12.65 |
Stock And Unit-Based Compensa_6
Stock And Unit-Based Compensation - Summary of Restricted Stock Unit (RSU) (Detail) - Restricted Stock Units (RSUs) | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Beginning balance | shares | 216,804 |
Granted | shares | 182,272 |
Vested | shares | (17,864) |
Canceled and forfeited | shares | (6,130) |
Ending balance | shares | 375,082 |
Beginning balance | $ / shares | $ 32.21 |
Granted | $ / shares | 59.63 |
Vested | $ / shares | 50.46 |
Canceled and forfeited | $ / shares | 21.52 |
Ending balance | $ / shares | $ 44.84 |
Stock And Unit-Based Compensa_7
Stock And Unit-Based Compensation - Summary of Valuation Of Stock Options (Detail) - OAK Street Health Inc and Affiliates [Member] - Black Sholes [Member] | 3 Months Ended |
Mar. 31, 2021$ / shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Risk-free interest rate | 0.79% |
Volatility | 50.00% |
Expected term to expiration (years) | 6 years 3 months |
Expected dividend yield | 0.00% |
Estimated fair value | $ 28.69 |
Variable Interest Entities - Su
Variable Interest Entities - Summary of VIE Assets and Liabilities and Performance for the Physician Groups (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Variable Interest Entity [Line Items] | |||
Total assets | $ 1,676 | $ 781 | |
Total liabilities | 1,398 | 357.8 | |
Total revenues | 296.7 | $ 201.8 | |
Cost of providing patient care in relation to revenue waived | 186.1 | 90.2 | |
Total operating expenses | 360.5 | 214.8 | |
Variable Interest Entity, Primary Beneficiary [Member] | |||
Variable Interest Entity [Line Items] | |||
Total assets | 394.2 | 286.1 | |
Total liabilities | 337.7 | $ 332.1 | |
Total revenues | 294.3 | 198.5 | |
Total operating expenses | 231.7 | 146.7 | |
Variable Interest Entity, Primary Beneficiary [Member] | Medical Claims Expense [Member] | |||
Variable Interest Entity [Line Items] | |||
Cost of providing patient care in relation to revenue waived | 198.9 | 131.4 | |
Variable Interest Entity, Primary Beneficiary [Member] | Cost of Care, Excluding Depreciation and Amortization [Member] | |||
Variable Interest Entity [Line Items] | |||
Cost of providing patient care in relation to revenue waived | $ 32.9 | $ 15.3 |
Related Parties - Additional In
Related Parties - Additional Information (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | ||||
Liability for unpaid claims | $ 274.6 | $ 211.6 | $ 262.1 | $ 170.6 |
Humana [Member] | ||||
Related Party Transaction [Line Items] | ||||
Percentage of common stock hold by related parties | 5.00% | |||
Revenue from related parties | $ 121.4 | 96.5 | ||
Due from related parties | 87.2 | 65.7 | ||
Due to related parties current | 4.1 | 2.6 | ||
Due to related parties noncurrent | 14.1 | 5 | ||
Related party transactions, medical claims expenses | 73 | 59.8 | ||
Liability for unpaid claims | 78.8 | 78.5 | ||
Payments for license fees | 0.7 | 0.7 | ||
Operating lease payments | 1.3 | 0.5 | ||
Deferred rent liability | 0 | 0.8 | ||
Assets related to human leases | 40.6 | |||
Liabilities related to human leases | 41.8 | |||
Corporate Joint Venture [Member] | Blue Cross Blue Shield of Rhode Island [Member] | ||||
Related Party Transaction [Line Items] | ||||
Revenue from related parties | 2.3 | |||
Due from related parties | 10 | |||
Related party transactions, medical claims expenses | 1.6 | |||
Liability for unpaid claims | $ 11.1 | |||
Equity method investment ownership percentage | 49.90% | |||
Corporate Joint Venture [Member] | Zing Health [Member] | ||||
Related Party Transaction [Line Items] | ||||
Revenue from related parties | 1.2 | 0.6 | ||
Due from related parties | 0.8 | $ 0.2 | ||
Related party transactions, medical claims expenses | 1 | 0.4 | ||
Liability for unpaid claims | 1.2 | 0.7 | ||
Fee For Service Revenue [Member] | Humana [Member] | ||||
Related Party Transaction [Line Items] | ||||
Due from related parties | 0.1 | 0 | ||
Related party transaction other patient service revenue | 0.1 | 0.1 | ||
Care Coordination Revenue [Member] | Humana [Member] | ||||
Related Party Transaction [Line Items] | ||||
Related party transaction other patient service revenue | 1.1 | $ 0.7 | ||
License Fee [Member] | Humana [Member] | ||||
Related Party Transaction [Line Items] | ||||
Due to related parties current | 2.7 | 0.6 | ||
Due to related parties noncurrent | $ 8.4 | $ 7.3 |
Net Loss Per Share - Summary of
Net Loss Per Share - Summary of Basic and Diluted Net Loss Per Common Unit (Detail) - OAK Street Health Inc and Affiliates [Member] - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Numerator: | ||
Net loss | $ (64) | |
Less: Net loss attributable to non-controlling interests | (0.6) | $ (0.4) |
Net loss attributable to the Oak Street Health, Inc. | $ (63.4) | $ (15) |
Denominator: | ||
Weighted average common stock outstanding - basic and diluted | 220,736,845 | |
Net loss per share – basic and diluted | $ (0.29) |
Net Loss Per Share - Summary _2
Net Loss Per Share - Summary of Potential Common Shares Outstanding from the Computation of Diluted Net Loss Per Share/Unit (Detail) - OAK Street Health Inc and Affiliates [Member] | 3 Months Ended | |
Mar. 31, 2021shares | ||
Total | 47,037,247 | |
Stock Options [Member] | ||
Stock options | 15,185,585 | |
Convertible Senior Notes [Member] | ||
Senior Convertible Notes | 11,622,176 | [1] |
Restricted Stock Units (RSUs) | ||
RSUs | 375,082 | |
Restricted Stock Awards R S A | ||
RSAs | 19,854,404 | |
[1] | The Company entered into capped call transactions to mitigate the impact of potential economic dilution to our common stock upon any conversion of our Convertible Senior Notes. The capped call transactions are expected to offset the potential dilution to the Company’s common stock upon any conversion of the Convertible Senior Notes up to a cap price of $138.8750 per share. See Note 10 for further details on the capped call transactions. |
Net Loss Per Share - Summary _3
Net Loss Per Share - Summary of Potential Common Shares Outstanding from the Computation of Diluted Net Loss Per Share/Unit (Parenthetical) (Detail) | 3 Months Ended |
Mar. 31, 2021$ / shares | |
Earnings Per Share [Abstract] | |
Conversion price cap initially equa | $ 138.8750 |