The Pennant Group, Inc. (PNTG) 10-Q 8 Aug 23 2023 Q2 Quarterly report Financial data

COVER

COVER - shares	6 Months Ended
	Jun. 30, 2023	Aug. 07, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Document Transition Report	false
Entity File Number	001-38900
Entity Registrant Name	THE PENNANT GROUP, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	83-3349931
Entity Address, Address Line One	1675 East Riverside Drive
Entity Address, Address Line Two	Suite 150
Entity Address, City or Town	Eagle
Entity Address, State or Province	ID
Entity Address, Postal Zip Code	83616
City Area Code	(208)
Local Phone Number	506-6100
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	PNTG
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		29,850,343
Entity Central Index Key	0001766400
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Amendment Flag	false

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets:
Cash	$ 2,838	$ 2,079
Accounts receivable—less allowance for doubtful accounts of $957 and $592, respectively	57,252	53,420
Prepaid expenses and other current assets	11,549	18,323
Total current assets	71,639	73,822
Property and equipment, net	27,252	26,621
Right-of-use assets	260,730	260,868
Deferred tax assets, net	214	2,149
Restricted and other assets	10,940	10,545
Goodwill	83,614	79,497
Other indefinite-lived intangibles	61,025	58,617
Total assets	515,414	512,119
Current liabilities:
Accounts payable	12,037	13,647
Accrued wages and related liabilities	22,848	23,283
Operating lease liabilities—current	17,412	16,633
Other accrued liabilities	16,180	16,684
Total current liabilities	68,477	70,247
Long-term operating lease liabilities—less current portion	246,307	247,042
Other long-term liabilities	7,779	6,281
Long-term debt, net	59,153	62,892
Total liabilities	381,716	386,462
Commitments and contingencies
Equity:
Common stock, $0.001 par value; 100,000 shares authorized; 30,251 and 29,799 shares issued and outstanding, respectively, at June 30, 2023; and 30,149 and 29,692 shares issued and outstanding, respectively, at December 31, 2022	29	29
Additional paid-in capital	102,886	99,764
Retained earnings	25,931	21,284
Treasury stock, at cost, 3 shares at June 30, 2023 and December 31, 2022	(65)	(65)
Total Pennant Group, Inc. stockholders’ equity	128,781	121,012
Noncontrolling interest	4,917	4,645
Total equity	133,698	125,657
Total liabilities and equity	$ 515,414	$ 512,119

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 957	$ 592
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	30,251,000	30,149,000
Common stock, shares outstanding (in shares)	29,799,000	29,692,000
Treasury stock, at cost (in shares)	3,000	3,000

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Income Statement [Abstract]
Revenue	$ 132,281	$ 116,316	$ 258,745	$ 230,226
Expense
Cost of services	106,176	92,716	208,778	182,978
Rent—cost of services	9,836	9,078	19,433	19,129
General and administrative expense	8,791	9,741	17,496	19,774
Depreciation and amortization	1,214	1,279	2,494	2,426
Loss on asset dispositions and impairment, net	3	6,617	3	6,708
Total expenses	126,020	119,431	248,204	231,015
Income (loss) from operations	6,261	(3,115)	10,541	(789)
Other income (expense):
Other income (expense)	35	(35)	65	(32)
Interest expense, net	(1,453)	(821)	(2,859)	(1,450)
Other (expense), net	(1,418)	(856)	(2,794)	(1,482)
Income (loss) before provision for income taxes	4,843	(3,971)	7,747	(2,271)
Provision (benefit) for income taxes	1,921	(1,375)	2,828	(833)
Net income (loss)	2,922	(2,596)	4,919	(1,438)
Less: net income attributable to noncontrolling interest	125	80	272	224
Net income (loss) and other comprehensive income attributable to The Pennant Group, Inc.	$ 2,797	$ (2,676)	$ 4,647	$ (1,662)
Earnings (loss) per share:
Basic (in dollars per share)	$ 0.09	$ (0.09)	$ 0.16	$ (0.06)
Diluted (in dollars per share)	$ 0.09	$ (0.09)	$ 0.15	$ (0.06)
Weighted average common shares outstanding:
Basic (in shares)	29,809	28,605	29,780	28,589
Diluted (in shares)	30,193	28,605	30,171	28,589

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Retained Earnings	Treasury Stock	Non-controlling Interest
Equity, beginning balance, common stock (in shares) at Dec. 31, 2021		28,826
Equity, beginning balance at Dec. 31, 2021	$ 114,244	$ 28	$ 95,595	$ 14,641	$ (65)	$ 4,045
Equity, beginning balance, treasury stock (in shares) at Dec. 31, 2021					3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss) attributable to The Pennant Group, Inc.	1,014			1,014
Net income attributable to noncontrolling interests	144					144
Share-based compensation	2,440		2,440
Issuance of common stock from the exercise of stock options (in shares)		21
Issuance of common stock from the exercise of stock options	90	$ 1	89
Net issuance of restricted stock (in shares)		2
Equity, ending balance, common stock (in shares) at Mar. 31, 2022		28,849
Equity, ending balance at Mar. 31, 2022	117,932	$ 29	98,124	15,655	$ (65)	4,189
Equity, ending balance, treasury stock (in shares) at Mar. 31, 2022					3
Equity, beginning balance, common stock (in shares) at Dec. 31, 2021		28,826
Equity, beginning balance at Dec. 31, 2021	114,244	$ 28	95,595	14,641	$ (65)	4,045
Equity, beginning balance, treasury stock (in shares) at Dec. 31, 2021					3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss) attributable to The Pennant Group, Inc.	(1,662)
Net income attributable to noncontrolling interests	224
Equity, ending balance, common stock (in shares) at Jun. 30, 2022		28,886
Equity, ending balance at Jun. 30, 2022	117,987	$ 29	100,775	12,979	$ (65)	4,269
Equity, ending balance, treasury stock (in shares) at Jun. 30, 2022					3
Equity, beginning balance, common stock (in shares) at Mar. 31, 2022		28,849
Equity, beginning balance at Mar. 31, 2022	117,932	$ 29	98,124	15,655	$ (65)	4,189
Equity, beginning balance, treasury stock (in shares) at Mar. 31, 2022					3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss) attributable to The Pennant Group, Inc.	(2,676)			(2,676)
Net income attributable to noncontrolling interests	80					80
Share-based compensation	2,380		2,380
Issuance of common stock from the exercise of stock options (in shares)		33
Issuance of common stock from the exercise of stock options	271		271
Net issuance of restricted stock (in shares)		4
Equity, ending balance, common stock (in shares) at Jun. 30, 2022		28,886
Equity, ending balance at Jun. 30, 2022	$ 117,987	$ 29	100,775	12,979	$ (65)	4,269
Equity, ending balance, treasury stock (in shares) at Jun. 30, 2022					3
Equity, beginning balance, common stock (in shares) at Dec. 31, 2022	29,692	30,149
Equity, beginning balance at Dec. 31, 2022	$ 125,657	$ 29	99,764	21,284	$ (65)	4,645
Equity, beginning balance, treasury stock (in shares) at Dec. 31, 2022	3				3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss) attributable to The Pennant Group, Inc.	$ 1,850			1,850
Net income attributable to noncontrolling interests	147					147
Share-based compensation	1,367		1,367
Issuance of common stock from the exercise of stock options (in shares)		26
Issuance of common stock from the exercise of stock options	203		203
Net issuance of restricted stock (in shares)		28
Equity, ending balance, common stock (in shares) at Mar. 31, 2023		30,203
Equity, ending balance at Mar. 31, 2023	$ 129,224	$ 29	101,334	23,134	$ (65)	4,792
Equity, ending balance, treasury stock (in shares) at Mar. 31, 2023					3
Equity, beginning balance, common stock (in shares) at Dec. 31, 2022	29,692	30,149
Equity, beginning balance at Dec. 31, 2022	$ 125,657	$ 29	99,764	21,284	$ (65)	4,645
Equity, beginning balance, treasury stock (in shares) at Dec. 31, 2022	3				3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss) attributable to The Pennant Group, Inc.	$ 4,647
Net income attributable to noncontrolling interests	$ 272
Equity, ending balance, common stock (in shares) at Jun. 30, 2023	29,799	30,251
Equity, ending balance at Jun. 30, 2023	$ 133,698	$ 29	102,886	25,931	$ (65)	4,917
Equity, ending balance, treasury stock (in shares) at Jun. 30, 2023	3				3
Equity, beginning balance, common stock (in shares) at Mar. 31, 2023		30,203
Equity, beginning balance at Mar. 31, 2023	$ 129,224	$ 29	101,334	23,134	$ (65)	4,792
Equity, beginning balance, treasury stock (in shares) at Mar. 31, 2023					3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss) attributable to The Pennant Group, Inc.	2,797			2,797
Net income attributable to noncontrolling interests	125					125
Share-based compensation	1,303		1,303
Issuance of common stock from the exercise of stock options (in shares)		38
Issuance of common stock from the exercise of stock options	$ 249		249
Net issuance of restricted stock (in shares)		10
Equity, ending balance, common stock (in shares) at Jun. 30, 2023	29,799	30,251
Equity, ending balance at Jun. 30, 2023	$ 133,698	$ 29	$ 102,886	$ 25,931	$ (65)	$ 4,917
Equity, ending balance, treasury stock (in shares) at Jun. 30, 2023	3				3

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash flows from operating activities:
Net income (loss)	$ 4,919	$ (1,438)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	2,494	2,426
Amortization of deferred financing fees	261	260
Impairment of long-lived assets	0	214
Provision for doubtful accounts	349	380
Share-based compensation	2,670	4,820
Deferred income taxes	2,365	1,017
Change in operating assets and liabilities, net of acquisitions:
Accounts receivable	(2,631)	406
Prepaid expenses and other assets	5,610	(7,049)
Operating lease obligations	182	13
Accounts payable	(732)	1,794
Accrued wages and related liabilities	(435)	(34)
Other accrued liabilities	(99)	7,832
Contract liabilities (CARES Act advance payments)	0	(6,211)
Other long-term liabilities	580	469
Net cash provided by operating activities	15,533	4,899
Cash flows from investing activities:
Purchase of property and equipment	(3,973)	(7,863)
Cash payments for business acquisitions	(7,261)	(775)
Other	8	(112)
Net cash used in investing activities	(11,226)	(8,750)
Cash flows from financing activities:
Proceeds from Revolving Credit Facility	94,000	41,000
Payments on Revolving Credit Facility	(98,000)	(39,500)
Issuance of common stock upon the exercise of options	452	361
Net cash (used in) provided by financing activities	(3,548)	1,861
Net increase (decrease) in cash	759	(1,990)
Cash beginning of period	2,079	5,190
Cash end of period	2,838	3,200
Cash paid during the period for:
Interest	2,857	1,187
Income taxes	160	55
Lease liabilities	17,898	18,256
Right-of-use assets obtained in exchange for new operating lease obligations	8,329	1,385
Non-cash adjustment to right-of-use assets and lease liabilities from lease modifications	0	6,522
Non-cash adjustment to right-of-use assets and lease liabilities from lease terminations and assignments	0	(42,515)
Non-cash investing activity:
Capital expenditures in accounts payable	$ 402	$ 1,100

DESCRIPTION OF BUSINESS

DESCRIPTION OF BUSINESS	6 Months Ended
	Jun. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
DESCRIPTION OF BUSINESS	DESCRIPTION OF BUSINESS The Pennant Group, Inc. (herein referred to as “Pennant,” the “Company,” “it,” or “its”), is a holding company with no direct operating assets, employees or revenue. The Company, through its independent operating subsidiaries, provides healthcare services across the post-acute care continuum. As of June 30, 2023, the Company’s subsidiaries operated 101 home health, hospice and home care agencies and 51 senior living communities located in Arizona, California, Colorado, Idaho, Iowa, Montana, Nevada, Oklahoma, Oregon, Texas, Utah, Washington, Wisconsin and Wyoming. Certain of the Company’s subsidiaries, collectively referred to as the Service Center, provide accounting, payroll, human resources, information technology, legal, risk management, and other services to the operations through contractual relationships. Each of the Company’s affiliated operations are operated by separate, independent subsidiaries that have their own management, employees and assets. References herein to the consolidated “Company” and “its” assets and activities are not meant to imply, nor should they be construed as meaning, that Pennant has direct operating assets, employees or revenue, or that any of the subsidiaries are operated by Pennant.

BASIS OF PRESENTATION AND SUMMA

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Jun. 30, 2023
Accounting Policies [Abstract]
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation - The accompanying unaudited condensed consolidated financial statements of the Company (the “Interim Financial Statements”) reflect the Company’s financial position, results of operations and cash flows of the business. The Interim Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and pursuant to the regulations of the Securities and Exchange Commission (“SEC”). Management believes that the Interim Financial Statements reflect, in all material respects, all adjustments which are of a normal and recurring nature necessary to present fairly the Company’s financial position, results of operations, and cash flows for the periods presented in conformity with GAAP. The results reported in these Interim Financial Statements are not necessarily indicative of results that may be expected for the entire year. The Condensed Consolidated Balance Sheet as of December 31, 2022 is derived from the Company’s annual audited Consolidated Financial Statements for the fiscal year ended December 31, 2022, which should be read in conjunction with these Interim Financial Statements. Certain information in the accompanying footnote disclosures normally included in annual financial statements was condensed or omitted for the interim periods presented in accordance with GAAP. All significant intercompany transactions and balances between the various legal entities comprising the Company have been eliminated in consolidation. The Company presents noncontrolling interests within the equity section of its Condensed Consolidated Balance Sheets and the amount of consolidated net income that is attributable to the Company and the noncontrolling interest in its Condensed Consolidated Statements of Income. The Company consists of various limited liability companies and corporations established to operate home health, hospice, home care, and senior living operations. The Interim Financial Statements include the accounts of all entities controlled by the Company through its ownership of a majority voting interest. Estimates and Assumptions - The preparation of the Interim Financial Statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Interim Financial Statements and the reported amounts of revenue and expenses during the reporting periods. The most significant estimates in the Interim Financial Statements relate to revenue, intangible assets and goodwill, right-of-use assets and lease liabilities for leases greater than 12 months, self-insurance reserves, and income taxes. Actual results could differ from those estimates. CARES Act : The Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was enacted on March 27, 2020 in the United States. The CARES Act allowed for deferred payment of the employer-paid portion of social security taxes through the end of 2020, with 50% due on December 31, 2021 and the remainder due on December 31, 2022. The Company deferred approximately $7,836 of the employer-paid portion of social security taxes, all of which was repaid by December 31, 2022. The CARES Act also expanded the Centers for Medicare & Medicaid Services’ (“CMS”) ability to provide accelerated/advance payments intended to increase the cash flow of healthcare providers and suppliers impacted by COVID-19. During 2020, the Company applied for and received $27,997 in funds under the Accelerated and Advance Payment (“AAP”) Program, all of which was recouped as of June 23, 2022. State relief funding. The Company receives state relief funding through programs from various states, including healthcare relief funding under the American Rescue Plan Act (ARPA), and other state specific relief programs. The funding generally incorporates specific use requirements primarily for direct patient care including labor related expenses that are attributable to the COVID-19 pandemic or are associated with providing patient care.

TRANSACTIONS WITH ENSIGN

TRANSACTIONS WITH ENSIGN	6 Months Ended
	Jun. 30, 2023
Related Party Transactions [Abstract]
TRANSACTIONS WITH ENSIGN	TRANSACTIONS WITH ENSIGN On October 1, 2019, The Ensign Group, Inc. (“Ensign”) completed the separation of Pennant (the “Spin-Off”). Pennant and Ensign continue to partner in the provision of services along the healthcare continuum. The Company incurred costs of $192 and $465 for the three and six months ended June 30, 2023, and $458 and $1,101 for the three and six months ended June 30, 2022, respectively, that related primarily to shared services at proximate operations. Expenses related to room and board charges at Ensign skilled nursing facilities for hospice patients were $1,014 and $1,954 for the three and six months ended June 30, 2023, respectively, and $648 and $1,223 for the three and six months ended June 30, 2022, respectively, and are included in cost of services. The Company’s independent operating subsidiaries leased 29 communities from subsidiaries of Ensign under a master lease arrangement as of June 30, 2023 and June 30, 2022. See further discussion below at Note 8, Leases. On January 27, 2022, affiliates of the Company entered into certain operations transfer agreements (collectively, the “Transfer Agreements”) with affiliates of Ensign, providing for the transfer of the operations of five senior living communities (the “Transaction”). The Transfer Agreements required one of the transferors to place $6,500 in escrow to cover post-closing capital expenditures and operating losses related to one of the communities, and such escrow was funded by an initial payment by the transferor at closing followed by eight equal monthly installments. The Company recorded the amount in loss on asset dispositions and impairment, net during the three months ended June 2022. The Transaction closed in April 2022.

NET INCOME (LOSS) PER COMMON SH

NET INCOME (LOSS) PER COMMON SHARE	6 Months Ended
	Jun. 30, 2023
Earnings Per Share [Abstract]
NET INCOME (LOSS) PER COMMON SHARE	NET INCOME (LOSS) PER COMMON SHAREBasic net income (loss) per share is computed by dividing net income (loss) attributable to stockholders of the Company by the weighted average number of outstanding common shares for the period. The computation of diluted net income (loss) per share is similar to the computation of basic net income (loss) per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued. The following table sets forth the computation of basic and diluted net income (loss) per share for the periods presented: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Numerator: Net income (loss) attributable to The Pennant Group, Inc. $ 2,797 $ (2,676) $ 4,647 $ (1,662) Denominator: Weighted average shares outstanding for basic net income per share 29,809 28,605 29,780 28,589 Plus: assumed incremental shares from exercise of options and assumed conversion or vesting of restricted stock (a) 384 — 391 — Adjusted weighted average common shares outstanding for diluted income per share 30,193 28,605 30,171 28,589 Earnings Per Share: Basic net income (loss) per common share $ 0.09 $ (0.09) $ 0.16 $ (0.06) Diluted net income (loss) per common share $ 0.09 $ (0.09) $ 0.15 $ (0.06) (a) The diluted per share amounts do not reflect common equivalent shares outstanding of 2,312 and 2,158 for the three and six months ended June 30, 2023, respectively, and 3,832 and 3,806 for the three and six months ended June 30, 2022, respectively, because of their anti-dilutive effect.

REVENUE AND ACCOUNTS RECEIVABLE

REVENUE AND ACCOUNTS RECEIVABLE	6 Months Ended
	Jun. 30, 2023
Revenue from Contract with Customer [Abstract]
REVENUE AND ACCOUNTS RECEIVABLE	REVENUE AND ACCOUNTS RECEIVABLE Revenue is recognized when services are provided to the patients at the amount that reflects the consideration to which the Company expects to be entitled from patients and third-party payors, including Medicare, Medicaid, Commercial and managed care programs (Medicare Advantage and Managed Medicaid plans), in exchange for providing patient care. The healthcare services in home health and hospice patient contracts include routine services in exchange for a contractual agreed-upon amount or rate. Routine services are treated as a single performance obligation satisfied over time as services are rendered. As such, patient care services represent a bundle of services that are not capable of being distinct within the context of the contract. Additionally, there may be ancillary services which are not included in the rates for routine services, but instead are treated as separate performance obligations satisfied at a point in time, if and when those services are rendered. Revenue recognized from healthcare services are adjusted for estimates of variable consideration to arrive at the transaction price. The Company determines the transaction price based on contractually agreed-upon amounts or rates, adjusted for estimates of variable consideration. The Company uses the expected value method in determining the variable component that should be used to arrive at the transaction price, using contractual agreements and historical reimbursement experience within each payor type. The amount of variable consideration which is included in the transaction price may be constrained, and is included in the net revenue only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. If actual amounts of consideration ultimately received differ from the Company’s estimates, the Company adjusts these estimates, which would affect net service revenue in the period such variances become known. Combined revenue from the Medicare and Medicaid programs accounted for 62.8% and 62.4% of the Company’s revenue for the three and six months ended June 30, 2023, respectively, and 62.8% and 62.4% for the three and six months ended June 30, 2022, respectively. The Company records revenue from these governmental and managed care programs as services are performed at their expected net realizable amounts under these programs. The Company’s revenue from governmental and managed care programs is subject to audit and retroactive adjustment by governmental and third-party agencies. Consistent with healthcare industry accounting practices, any changes to these governmental revenue estimates are recorded in the period the change or adjustment becomes known based on final settlement. Disaggregation of Revenue The Company disaggregates revenue from contracts with its patients by reportable operating segments and payors. The Company has determined that disaggregating revenue into these categories achieves the disclosure objectives to depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. The Company’s service specific revenue recognition policies are as follows: Home Health Revenue Medicare Revenue Net service revenue is recognized in accordance with the Patient Driven Groupings Model (“PDGM”). Under PDGM, Medicare provides agencies with payments for each 30-day payment period provided to beneficiaries. If a beneficiary is still eligible for care after the end of the first 30-day payment period, a second 30-day payment period can begin. There are no limits to the number of periods of care a beneficiary who remains eligible for the home health benefit can receive. While payment for each 30-day payment period is adjusted to reflect the beneficiary’s health condition and needs, a special outlier provision exists to ensure appropriate payment for those beneficiaries that have the most expensive care needs. The payment under the Medicare program is also adjusted for certain variables including, but not limited to: (a) a low utilization payment adjustment if the number of visits is below an established threshold that varies based on the diagnosis of a beneficiary; (b) a partial payment if the patient transferred to another provider or the Company received a patient from another provider before completing the period of care; (c) adjustment to the admission source of claim if it is determined that the patient had a qualifying stay in a post-acute care setting within 14 days prior to the start of a 30-day payment period; (d) the timing of the 30-day payment period provided to a patient in relation to the admission date, regardless of whether the same home health provider provided care for the entire series of episodes; (e) changes to the acuity of the patient during the previous 30-day payment period; (f) changes in the base payments established by the Medicare program; (g) adjustments to the base payments for case mix and geographic wages; and (h) recoveries of overpayments. The Company adjusts Medicare revenue on completed episodes to reflect differences between estimated and actual payment amounts, an inability to obtain appropriate billing documentation and other reasons unrelated to credit risk. Therefore, the Company believes that its reported net service revenue and patient accounts receivable will be the net amounts to be realized from Medicare for services rendered. In addition to revenue recognized on completed episodes and periods, the Company also recognizes a portion of revenue associated with episodes and periods in progress. Episodes in progress are 30-day payment periods that begin during the reporting period but were not completed as of the end of the period. As such, the Company estimates revenue and recognizes it on a daily basis. The primary factors underlying this estimate are the number of episodes in progress at the end of the reporting period, expected Medicare revenue per period of care or episode of care and the Company’s estimate of the average percentage complete based on the scheduled end of period and end of episode dates. Non-Medicare Revenue Episodic Based Revenue - The Company recognizes revenue in a similar manner as it recognizes Medicare revenue for episodic-based rates that are paid by other insurance carriers, including Medicare Advantage programs. These rates can vary based upon the negotiated terms. Non-episodic Based Revenue - Revenue is recognized on an accrual basis based upon the date of service at amounts equal to its established or estimated per visit rates, as applicable. Hospice Revenue Revenue is recognized on an accrual basis based upon the date of service at amounts equal to the estimated payment rates. The estimated payment rates are calculated as daily rates for each of the levels of care the Company delivers. Revenue is adjusted for an inability to obtain appropriate billing documentation or authorizations acceptable to the payor and other reasons unrelated to credit risk. Additionally, as Medicare hospice revenue is subject to an inpatient cap and an overall payment cap, the Company monitors its provider numbers and estimates amounts due back to Medicare if a cap has been exceeded. The Company regularly evaluates and records these adjustments as a reduction to revenue and an increase to other accrued liabilities. Senior Living Revenue The Company has elected the lessor practical expedient within ASC Topic 842, Leases and therefore recognizes, measures, presents, and discloses the revenue for services rendered under the Company’s senior living residency agreements based upon the predominant component, either the lease or non-lease component, of the contracts. The Company has determined that the services included under the Company’s senior living residency agreements each have the same timing and pattern of transfer. The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customers for its senior residency agreements, for which it has determined that the non-lease components of such residency agreements are the predominant component of each such contract. The Company’s senior living revenue consists of fees for basic housing and assisted living care. Accordingly, the Company records revenue when services are rendered on the date services are provided at amounts billable to individual residents. Residency agreements are generally for a term of 30 days, with resident fees billed monthly in advance. For residents under reimbursement arrangements with Medicaid, revenue is recorded based on contractually agreed-upon amounts or rates on a per resident, daily basis or as services are rendered. Revenue By Payor Revenue by payor for the three months ended June 30, 2023 and 2022, is summarized in the following tables: Three Months Ended June 30, 2023 Home Health and Hospice Services Home Health Services Hospice Services Senior Living Services Total Revenue Revenue % Medicare $ 23,920 $ 40,294 $ — $ 64,214 48.5 % Medicaid 2,466 4,682 11,783 18,931 14.3 Subtotal 26,386 44,976 11,783 83,145 62.8 Managed care 15,837 1,417 — 17,254 13.1 Private and other (a) 6,235 169 25,478 31,882 24.1 Total revenue $ 48,458 $ 46,562 $ 37,261 $ 132,281 100.0 % (a) Private and other payors in the Company’s home health and hospice services segment includes revenue from all payors generated in the Company’s home care operations. Three Months Ended June 30, 2022 Home Health and Hospice Services Home Health Services Hospice Services Senior Living Services Total Revenue Revenue % Medicare $ 23,464 $ 34,234 $ — $ 57,698 49.6 % Medicaid 2,732 3,859 8,752 15,343 13.2 Subtotal 26,196 38,093 8,752 73,041 62.8 Managed care 14,260 1,153 — 15,413 13.3 Private and other (a) 5,529 113 22,220 27,862 23.9 Total revenue $ 45,985 $ 39,359 $ 30,972 $ 116,316 100.0 % (a) Private and other payors in the Company’s home health and hospice services segment includes revenue from all payors generated in the Company’s home care operations. Revenue by payor for the six months ended June 30, 2023 and 2022, is summarized in the following tables: Six Months Ended June 30, 2023 Home Health and Hospice Services Home Health Services Hospice Services Senior Living Services Total Revenue Revenue % Medicare $ 47,296 $ 77,674 $ — $ 124,970 48.3 % Medicaid 4,657 9,280 22,625 36,562 14.1 Subtotal 51,953 86,954 22,625 161,532 62.4 Managed care 31,769 2,611 — 34,380 13.3 Private and other (a) 12,526 286 50,021 62,833 24.3 Total revenue $ 96,248 $ 89,851 $ 72,646 $ 258,745 100.0 % (a) Private and other payors in the Company’s home health and hospice services segment includes revenue from all payors generated in the Company’s home care operations. Six Months Ended June 30, 2022 Home Health and Hospice Services Home Health Services Hospice Services Senior Living Services Total Revenue Revenue % Medicare $ 44,821 $ 67,955 $ — $ 112,776 49.0 % Medicaid 5,238 7,124 18,375 30,737 13.4 Subtotal 50,059 75,079 18,375 143,513 62.4 Managed care 27,512 1,937 — 29,449 12.7 Private and other (a) 11,066 166 46,032 57,264 24.9 Total revenue $ 88,637 $ 77,182 $ 64,407 $ 230,226 100.0 % (a) Private and other payors in the Company’s home health and hospice services segment includes revenue from all payors generated in the Company’s home care operations. Balance Sheet Impact Included in the Company’s Condensed Consolidated Balance Sheets are contract assets, comprised of billed accounts receivable and unbilled receivables, which are the result of the timing of revenue recognition, billings and cash collections, as well as, contract liabilities, which primarily represent payments the Company receives in advance of services provided. Accounts receivable, net as of June 30, 2023 and December 31, 2022 is summarized in the following table: June 30, 2023 December 31, 2022 Medicare $ 32,516 $ 31,321 Medicaid 13,216 10,700 Managed care 9,705 9,370 Private and other 2,772 2,621 Accounts receivable, gross 58,209 54,012 Less: allowance for doubtful accounts (957) (592) Accounts receivable, net $ 57,252 $ 53,420 Concentrations - Credit Risk The Company has significant accounts receivable balances, the collectability of which is dependent on the availability of funds from certain governmental programs, primarily Medicare and Medicaid. These receivables represent the only significant concentration of credit risk for the Company. The Company does not believe there are significant credit risks associated with these governmental programs. The Company believes that an appropriate allowance has been recorded for the possibility of these receivables proving uncollectible, and continually monitors and adjusts these allowances as necessary. The Company’s gross receivables from the Medicare and Medicaid programs accounted for approximately 78.6% and 77.8% of its total gross accounts receivable as of June 30, 2023 and December 31, 2022, respectively. Combined revenue from reimbursement under the Medicare and Medicaid programs accounted for 62.8% and 62.4% for the three and six months ended June 30, 2023, respectively, and 62.8% and 62.4% of the Company’s revenue for the three and six months ended June 30, 2022, respectively. Practical Expedients and Exemptions As the Company’s contracts have an original duration of one year or less, the Company uses the practical expedient applicable to its contracts and does not consider the time value of money. Further, because of the short duration of these contracts, the Company has not disclosed the transaction price for the remaining performance obligations as of the end of each reporting period or when the Company expects to recognize this revenue. In addition, the Company has applied the practical expedient provided by ASC 340, Other Assets and Deferred Costs , and all incremental customer contract acquisition costs are expensed as they are incurred because the amortization period would have been one year or less.

BUSINESS SEGMENTS

BUSINESS SEGMENTS	6 Months Ended
	Jun. 30, 2023
Segment Reporting [Abstract]
BUSINESS SEGMENTS	BUSINESS SEGMENTS The Company classifies its operations into the following reportable operating segments: (1) home health and hospice services, which includes the Company’s home health, hospice and home care businesses; and (2) senior living services, which includes the operation of assisted living, independent living and memory care communities. The reporting segments are business units that offer different services and are managed separately to provide greater visibility into those operations. The Company’s Chief Executive Officer, who is the Company’s Chief Operating Decision Maker (“CODM”), reviews financial information at the operating segment level. The Company also reports an “all other” category that includes general and administrative expense from the Company’s Service Center. As of June 30, 2023, the Company provided services through 101 affiliated home health, hospice and home care agencies, and 51 affiliated senior living operations. The Company evaluates performance and allocates capital resources to each segment based on an operating model that is designed to maximize the quality of care provided and profitability. The Company’s Service Center provides various services to all lines of business. The Company does not review assets by segment and therefore assets by segment are not disclosed below. The CODM uses Segment Adjusted EBITDAR from Operations as the primary measure of profit and loss for the Company's reportable segments and to compare the performance of its operations with those of its competitors. Segment Adjusted EBITDAR from Operations is net income (loss) attributable to the Company's reportable segments excluding interest expense, provision for income taxes, depreciation and amortization expense, rent, and, in order to view the operations performance on a comparable basis from period to period, certain adjustments including: (1) costs at start-up operations, (2) share-based compensation, (3) acquisition related costs and credit allowances, (4) the costs associated with transitioning operations, (5) unusual, non-recurring or redundant charges, and (6) net income attributable to noncontrolling interest. General and administrative expenses are not allocated to the reportable segments, and are included as “All Other”, accordingly the segment earnings measure reported is before allocation of corporate general and administrative expenses. The Company's segment measures may be different from the calculation methods used by other companies and, therefore, comparability may be limited. The following tables present certain financial information regarding the Company’s reportable segments, general and administrative expenses are not allocated to the reportable segments and are included in “All Other” for the three and six months ended June 30, 2023 and 2022: Home Health and Hospice Services Senior Living Services All Other Total Three Months Ended June 30, 2023 Revenue $ 95,020 $ 37,261 $ — $ 132,281 Segment Adjusted EBITDAR from Operations $ 15,681 $ 11,680 $ (7,885) $ 19,476 Three Months Ended June 30, 2022 Revenue $ 85,344 $ 30,972 $ — $ 116,316 Segment Adjusted EBITDAR from Operations $ 15,728 $ 8,771 $ (7,870) $ 16,629 Home Health and Hospice Services Senior Living Services All Other Total Six Months Ended June 30, 2023 Revenue $ 186,099 $ 72,646 $ — $ 258,745 Segment Adjusted EBITDAR from Operations $ 30,093 $ 21,921 $ (15,399) $ 36,615 Six Months Ended June 30, 2022 Revenue $ 165,819 $ 64,407 $ — $ 230,226 Segment Adjusted EBITDAR from Operations $ 29,676 $ 18,203 $ (16,016) $ 31,863 The following table provides a reconciliation of Segment Adjusted EBITDAR from Operations to income from operations: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Segment Adjusted EBITDAR from Operations $ 19,476 $ 16,629 $ 36,615 $ 31,863 Less: Depreciation and amortization 1,214 1,279 2,494 2,426 Rent—cost of services 9,836 9,078 19,433 19,129 Other expense 35 (35) 65 (32) Adjustments to Segment EBITDAR from Operations: Less: Costs at start-up operations (a) 65 377 268 508 Share-based compensation expense and related taxes (b) 1,354 2,380 2,773 4,820 Acquisition related costs and credit allowances (c) 72 14 104 14 Costs associated with transitioning operations (d) 538 6,691 585 5,934 Unusual, non-recurring or redundant charges (e) 226 40 624 77 Add: Net income attributable to noncontrolling interest 125 80 272 224 Condensed Consolidated Income (Loss) from Operations $ 6,261 $ (3,115) $ 10,541 $ (789) (a) Represents results related to start-up operations. This amount excludes rent and depreciation and amortization expense related to such operations. (b) Share-based compensation expense and related payroll taxes incurred. Share-based compensation expense and related payroll taxes are included in cost of services and general and administrative expense. (c) Non-capitalizable costs associated with acquisitions and credit allowances for amounts in dispute with the prior owners of certain acquired operations. (d) During the six months ended June 30, 2023, an affiliate of the Company placed its memory care units into transition and is actively seeking to sublease the units to an unrelated third party. The amount above represents the net operating impact attributable to the units in transition. The amounts reported exclude rent and depreciation and amortization expense related to such operations and include legal settlement costs associated with one of the entities transitioned to Ensign. During January 2022, affiliates of the Company entered into Transfer Agreements with affiliates of Ensign, providing for the transfer of the operations of certain senior living communities (the “Transaction”) from affiliates of the Company to affiliates of Ensign. The closing of the Transaction was completed in two phases with the transfer of two operations on March 1, 2022 and the remainder transferred on April 1, 2022. The amount above represents the net impact on revenue and cost of service attributable to all of the transferred entities. The amounts reported exclude rent and depreciation and amortization expense related to such operations. (e) Represents unusual or non-recurring charges for legal services, implementation costs, integration costs, and consulting fees in general and administrative expenses. Costs identified as redundant or non-recurring incurred by the Company for additional services provided by Ensign. All amounts are included in general and administrative expense. Fees incurred were $192 and $465 for the three and six months ended June 30, 2023, respectively, and $458 and $1,101 for the three and six months ended June 30, 2022, respectively.

ACQUISITIONS

ACQUISITIONS	6 Months Ended
	Jun. 30, 2023
Business Combination and Asset Acquisition [Abstract]
ACQUISITIONS	ACQUISITIONS The Company is focused on acquiring operations that are complementary to the Company’s current businesses, accretive to the Company’s business or otherwise advance the Company’s strategy. The results of all the Company’s independent operating subsidiaries are included in the Interim Financial Statements subsequent to the date of acquisition. Acquisitions are accounted for using the acquisition method of accounting. 2023 Acquisitions During the six months ended June 30, 2023, the Company expanded its operations with the addition of three home health agencies, one hospice agency, two home care agencies, and two senior living communities. In connection with the addition of the two senior living communities, the Company entered into a new long-term “triple-net” lease. A subsidiary of the Company entered into a separate operations transfer agreement with the prior operator of each acquired operation as part of each transaction. The fair value of assets for two home health agencies , two home care agencies, and one hospice agency acquired were mostly concentrated in goodwill and intangible assets and as such, these transactions were classified as business combinations in accordance with ASC Topic 805, Business Combinations (“ASC 805”). The purchase price for the business combinations was $7,261, which consisted of equipment and other assets of $1,027, goodwill of $4,117, and indefinite-lived intangible assets of $2,012 related to Medicare and Medicaid licenses, and other intangible assets of $186 less assumed liabilities of $81. The Company anticipates that the total goodwill recognized will be fully deductible for tax purposes. One home health agency acquired was a Medicare license and is considered an asset acquisition. The fair value of the home health license acquired was $210 and was allocated to indefinite-lived intangible assets. There were no material acquisition costs that were expensed related to the business combinations during the six months ended June 30, 2023. 2022 Acquisitions During the six months ended June 30, 2022, the Company expanded its operations with the addition of one home health agency. The purchase price for this home health acquisition was $775. The fair value of assets for home health acquisitions was mostly concentrated in goodwill and intangible assets and as such, these transactions were classified as business combinations in accordance with ASC Topic 805. The purchase price for the business combinations was $775, which consisted of equipment and other assets of $11, goodwill of $520, and indefinite-lived intangible assets of $244 related to Medicare and Medicaid licenses. The Company anticipates that the total goodwill recognized will be fully deductible for tax purposes. There were no material acquisition costs that were expensed related to the business combinations during the six months ended June 30, 2022.

PROPERTY AND EQUIPMENT_NET

PROPERTY AND EQUIPMENT—NET	6 Months Ended
	Jun. 30, 2023
Property, Plant and Equipment [Abstract]
PROPERTY AND EQUIPMENT—NET	PROPERTY AND EQUIPMENT—NET Property and equipment, net consist of the following: June 30, 2023 December 31, 2022 Land $ 96 $ 96 Building 1,890 1,890 Leasehold improvements 19,670 18,759 Equipment 27,559 25,532 Furniture and fixtures 1,217 1,151 50,432 47,428 Less: accumulated depreciation (23,180) (20,807) Property and equipment, net $ 27,252 $ 26,621 Depreciation expense was $1,211 and $2,486 for the three and six months ended June 30, 2023, respectively, and $1,264 and $2,396 for the three and six months ended June 30, 2022, respectively. The Company measures certain assets at fair value on a non-recurring basis, including long-lived assets, which are evaluated for impairment. Long-lived assets include assets such as property and equipment, operating lease assets and certain intangible assets. The inputs used to determine the fair value of long-lived assets in the impairment analysis are considered Level 3 measurements due to their subjective nature. Management has evaluated its long-lived assets and determined there was no impairment recorded during the three and six months ended June 30, 2023 and 2022.

GOODWILL AND OTHER INDEFINITE-L

GOODWILL AND OTHER INDEFINITE-LIVED INTANGIBLE ASSETS	6 Months Ended
	Jun. 30, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
GOODWILL AND OTHER INDEFINITE-LIVED INTANGIBLE ASSETS	GOODWILL AND OTHER INDEFINITE-LIVED INTANGIBLE ASSETS The following table represents activity in goodwill by segment for the six months ended June 30, 2023: Home Health and Hospice Services Senior Living Services Total December 31, 2022 $ 75,855 $ 3,642 $ 79,497 Additions 4,117 — 4,117 June 30, 2023 $ 79,972 $ 3,642 $ 83,614 Other indefinite-lived intangible assets consist of the following: June 30, 2023 December 31, 2022 Trade name $ 1,571 $ 1,385 Medicare and Medicaid licenses 59,454 57,232 Total $ 61,025 $ 58,617

OTHER ACCRUED LIABILITIES

OTHER ACCRUED LIABILITIES	6 Months Ended
	Jun. 30, 2023
Payables and Accruals [Abstract]
OTHER ACCRUED LIABILITIES	OTHER ACCRUED LIABILITIES Other accrued liabilities consist of the following: June 30, 2023 December 31, 2022 Refunds payable $ 2,122 $ 2,244 Deferred revenue 1,819 1,592 Resident deposits 3,040 4,315 Property taxes 975 1,027 Deferred state relief funds 1,469 1,479 Accrued self-insurance liabilities 4,231 3,546 Other 2,524 2,481 Other accrued liabilities $ 16,180 $ 16,684

DEBT

DEBT	6 Months Ended
	Jun. 30, 2023
Debt Disclosure [Abstract]
DEBT	DEBT Long-term debt, net consists of the following: June 30, 2023 December 31, 2022 Revolving Credit Facility $ 60,500 $ 64,500 Less: unamortized debt issuance costs (a) (1,347) (1,608) Long-term debt, net $ 59,153 $ 62,892 (a) Amortization expense for debt issuance costs was $130 and $261 for the three and six months ended June 30, 2023, respectively, and $130 and $260 for the three and six months ended June 30, 2022, respectively, and is recorded in interest expense, net on the Condensed Consolidated Statements of Income. On February 23, 2021, Pennant entered into an amendment to its existing credit agreement (as amended, the “Credit Agreement”), which provides for an increased revolving credit facility with a syndicate of banks with a borrowing capacity of $150,000 (the “Revolving Credit Facility”). On June 12, 2023, Pennant entered into a second amendment to the Credit Agreement that modified the reference rate from LIBOR to Standard Overnight Financing Rate (“SOFR”). The interest rates applicable to loans under the Revolving Credit Facility are, at the Company’s election, either (i) Adjusted Term SOFR (as defined in the Credit Agreement) plus a margin ranging from 2.25% to 3.25% per annum or (ii) Base Rate plus a margin ranging from 1.25% to 2.25% per annum, in each case, based on the ratio of Consolidated Total Net Debt to Consolidated EBITDA (each, as defined in the Credit Agreement). In addition, Pennant pays a commitment fee on the undrawn portion of the commitments under the Revolving Credit Facility which ranges from 0.35% to 0.50% per annum, depending on the Consolidated Total Net Debt to Consolidated EBITDA ratio of the Company and its subsidiaries. The Company is not required to repay any loans under the Credit Agreement prior to maturity in 2026, other than to the extent the outstanding borrowings exceed the aggregate commitments under the Credit Agreement. As of June 30, 2023, the Company’s weighted average interest rate on its outstanding debt was 7.97%. As of June 30, 2023, the Company had available borrowing on the Revolving Credit Facility of $85,314, which is net of outstanding letters of credit of $4,186. The fair value of the Revolving Credit Facility approximates carrying value, due to the short-term natur e and variable interest rates. The fair value of this debt is categorized within Level 2 of the fair value hierarchy based on the observable market borrowing rates. The Credit Agreement is guaranteed, jointly and severally, by certain of the Company’s independent operating subsidiaries, and is secured by a pledge of stock of the Company's material independent operating subsidiaries as well as a first lien on substantially all of each material operating subsidiary's personal property. The Credit Agreement contains customary covenants that, among other things, restrict, subject to certain exceptions, the ability of the Company and its independent operating subsidiaries to grant liens on their assets, incur indebtedness, sell assets, make investments, engage in acquisitions,

OPTIONS AND AWARDS

OPTIONS AND AWARDS	6 Months Ended
	Jun. 30, 2023
Share-Based Payment Arrangement [Abstract]
OPTIONS AND AWARDS	OPTIONS AND AWARDS Outstanding options and restricted stock awards of the Company were granted under the 2019 Omnibus Incentive Plan (the “ OIP ” ) and Long-Term Incentive Plan (the “ LTIP ”, and together with the OIP, the “Pennant Plans” ). Under the Pennant Plans, stock-based payment awards, including employee stock options, restricted stock awards (“RSA”), and restricted stock units (“RSU” and together with RSA, “Restricted Stock”) are issued based on estimated fair value. The following disclosures represent share-based compensation expense relating to employees of the Company’s subsidiaries and non-employee directors who have awards under the Pennant Plans. Total share-based compensation expense for all Plans for the three and six months ended June 30, 2023 and 2022 was: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Share-based compensation expense related to stock options $ 984 779 $ 1,834 $ 1,621 Share-based compensation expense related to Restricted Stock 180 1,502 357 3,021 Share-based compensation expense related to Restricted Stock to non-employee directors 139 99 479 178 Total share-based compensation $ 1,303 $ 2,380 $ 2,670 $ 4,820 In future periods, the Company estimates it will recognize the following share-based compensation expense for unvested stock options and unvested Restricted Stock as of June 30, 2023: Unrecognized Compensation Expense Weighted Average Recognition Period Unvested Stock Options $ 12,296 3.5 Unvested Restricted Stock 2,751 4.0 Total unrecognized share-based compensation expense $ 15,047 On July 25, 2022 the Company modified certain outstanding RSUs granted to the former chief executive officer of the Company in connection with the Spin-off. All the RSUs had an original vesting date of October 1, 2022. The modification resulted in the forfeiture of 250 outstanding RSUs and accelerated the vesting on the remaining 943 RSUs from October 1, 2022 to July 31, 2022. The modification of the award resulted in a net reduction of share-based compensation expense related to the awards of $3,812 recorded in general and administrative expense in the third quarter of 2022. Stock Options Under the Pennant Plans, options granted to employees of the subsidiaries of Pennant generally vest over five years at 20% per year on the anniversary of the grant date. Options expire ten years after the date of grant. The Company uses the Black-Scholes option-pricing model to recognize the value of stock-based compensation expense for share-based payment awards under the Plans. Determining the appropriate fair-value model and calculating the fair value of stock-based awards at the grant date requires considerable judgment, including estimating stock price volatility and expected option life. The Company develops estimates based on historical data and market information, which can change significantly over time. The fair value of each option is estimated on the grant date using a Black-Scholes option-pricing model with the following weighted average assumptions for stock options granted as of June 30: Grant Year Options Granted Risk-Free Interest Rate Expected Life (a) Expected Volatility (b) Dividend Yield Weighted Average Fair Value of Options 2023 656 4.0 % 6.5 41.6 % — % $ 6.78 2022 298 2.2 % 6.5 39.9 % — % $ 6.60 (a) Under the midpoint method, the expected option life is the midpoint between the contractual option life and the average vesting period for the options being granted. This resulted in an expected option life of 6.5 years for the options granted. (b) Because the Company’s equity shares have been traded for a relatively short period of time, expected volatility assumption was based on the volatility of related industry stocks. The following table represents the employee stock option activity during the six months ended June 30, 2023: Number of Options Outstanding Weighted Number of Options Vested Weighted Average Exercise Price of Options Vested December 31, 2022 2,219 20.76 973 $ 16.90 Granted 656 14.03 Exercised (63) 7.18 Forfeited (37) 22.22 Expired (34) 20.13 June 30, 2023 2,741 $ 19.29 1,054 $ 18.17 Restricted Stock A summary of the status of Pennant’s non-vested Restricted Stock, and changes during the six months ended June 30, 2023, is presented below: Non-Vested Restricted Stock Weighted Average Grant Date Fair Value December 31, 2022 418 $ 14.26 Granted 42 11.42 Vested (78) 12.53 Forfeited (3) 15.30 June 30, 2023 379 $ 14.29

LEASES

LEASES	6 Months Ended
	Jun. 30, 2023
Leases [Abstract]
LEASES	LEASESThe Company’s independent operating subsidiaries lease 51 senior living communities and its administrative offices under non-cancelable operating leases, most of which have initial lease terms ranging from 15 to 25 years. Most of these leases contain renewal options, most involve rent increases and none contain purchase options. The lease term excludes lease renewals because the renewal rents are not at a bargain, there are no economic penalties for the Company to renew the lease, and it is not reasonably certain that the Company will exercise the extension options. The Company’s independent operating subsidiaries leased 29 communities from subsidiaries of Ensign (the “Ensign Leases”) under a master lease arrangement as of June 30, 2023 and June 30, 2022. Each of the leases have an initial term of between 14 and 20 years from the lease commencement date. The total amount of rent expense included in rent - cost of services paid to subsidiaries of Ensign was $3,333 and $6,749 for the three and six months ended June 30, 2023, respectively, and $3,006 and $6,490 for the three and six months ended June 30, 2022, respectively. In addition to rent, each of the operating companies are required to pay the following: (1) all impositions and taxes levied on or with respect to the leased properties (other than taxes on the income of the lessor); (2) all utilities and other services necessary or appropriate for the leased properties and the business conducted on the leased properties; (3) all insurance required in connection with the leased properties and the business conducted on the leased properties; (4) all community maintenance and repair costs; and (5) all fees in connection with any licenses or authorizations necessary or appropriate for the leased properties and the business conducted on the leased properties. Fourteen of the Company’s affiliated senior living communities, excluding the communities that are operated under the Ensign Leases (as defined herein), are operated under three separate master lease arrangements. Under these master leases, a breach at a single community could subject one or more of the other communities covered by the same master lease to the same default risk. Failure to comply with Medicare and Medicaid provider requirements is a default under several of the Company’s leases and master leases. With an indivisible lease, it is difficult to restructure the composition of the portfolio or economic terms of the master lease without the consent of the landlord. As further described in Note 3, on January 27, 2022, affiliates of the Company entered into Transfer Agreements with affiliates of Ensign, providing for the transfer of the operations of five senior living communities. The closing of the Transaction was completed in two phases with the transfer of two operations on March 1, 2022 and the remainder transferred on April 1, 2022. As a result of the lease terminations, the Company reduced both the right of use assets and the lease liabilities by $42,515. Four of the terminated leases were part of a master lease agreement. As a result of the transferred leases being removed from the master lease arrangement, the remaining lease components under the master lease arrangement were modified which resulted in a net increase to the lease liability and ROU asset balance of $6,522 for the six months ended June 30, 2022. On July 7, 2023 the Company modified one of its master leases, which included nine locations, with an unrelated party to extend the term of the master lease from September 30, 2035 to March 31, 2038. The components of operating lease cost, are as follows: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Operating Lease Costs: Community Rent—cost of services $ 8,462 $ 7,837 $ 16,736 $ 16,626 Office Rent—cost of services 1,374 1,241 2,697 2,503 Rent—cost of services $ 9,836 $ 9,078 $ 19,433 $ 19,129 General and administrative expense $ 104 $ 74 $ 197 $ 155 Variable lease cost (a) $ 1,761 $ 1,298 $ 3,491 $ 2,873 (a) Represents variable lease cost for operating leases, which costs include property taxes and insurance, common area maintenance, and consumer price index increases, incurred as part of the Company’s triple net lease, and which is included in cost of services for the three and six months ended June 30, 2023 and 2022. The following table shows the lease maturity analysis for all leases as of June 30, 2023, for the years ended December 31: Year Amount 2023 (Remainder) $ 18,300 2024 35,913 2025 34,543 2026 33,441 2027 32,778 Thereafter 253,655 Total lease payments 408,630 Less: present value adjustments (144,911) Present value of total lease liabilities 263,719 Less: current lease liabilities (17,412) Long-term operating lease liabilities $ 246,307 Operating lease liabilities are based on the net present value of the remaining lease payments over the remaining lease term. In determining the present value of lease payments, the Company used its incremental borrowing rate based on the information available at each lease’s commencement date to determine each lease's operating lease liability. As of June 30, 2023, the weighted average remaining lease term is 12.3 years and the weighted average discount rate is 7.6%.

INCOME TAXES

INCOME TAXES	6 Months Ended
	Jun. 30, 2023
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXESThe Company recorded income tax expense (benefit) of $1,921 and $(1,375) or 39.7% and 34.6% of earnings before income taxes for the three months ended June 30, 2023 and 2022, respectively. The increase in effective tax is primarily due to a change in the deductibility of equity compensation of certain executives.The Company recorded income tax expense (benefit) of $2,828 and $(833), or 36.5% and 36.7% of earnings before income taxes for the six months ended June 30, 2023 and 2022, respectively. The decrease in effective tax is primarily due to a changes in the deductibility of equity compensation of certain executives.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jun. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES Regulatory Matters - The Company provides services in complex and highly regulated industries. The Company’s compliance with applicable U.S. federal, state and local laws and regulations governing these industries may be subject to governmental review and adverse findings may result in significant regulatory action, which could include sanctions, damages, fines, penalties (many of which may not be covered by insurance), and even exclusion from government programs. The Company is a party to various regulatory and other governmental audits and investigations in the ordinary course of business and cannot predict the ultimate outcome of any federal or state regulatory survey, audit or investigation. While governmental audits and investigations are the subject of administrative appeals, the appeals process, even if successful, may take several years to resolve and penalties subject to appeal may remain in place during such appeals, which may include suspension, termination, or revocation of participation in governmental programs for the payment of the services the Company provides. The Department of Justice, CMS, or other federal and state enforcement and regulatory agencies may conduct additional investigations related to the Company's businesses. The Company believes it is presently in compliance in all material respects with all applicable laws and regulations. Cost-Containment Measures - Government and third-party payors have instituted cost-containment measures designed to limit payments made to providers of healthcare services, may propose future cost-containment measures, and there can be no assurance that future measures designed to limit payments made to providers will not adversely affect the Company. Indemnities - From time to time, the Company enters into certain types of contracts that contingently require the Company to indemnify parties against third-party claims. These contracts primarily include (i) certain real estate leases, under which the Company may be required to indemnify property owners or prior operators for post-transfer environmental or other liabilities and other claims arising from the Company’s use of the applicable premises, (ii) operations transfer agreements, in which the Company agrees to indemnify past operators of agencies and communities the Company acquires against certain liabilities arising from the transfer of the operation and/or the operation thereof after the transfer, (iii) certain Ensign lending agreements, and (iv) certain agreements with management, directors and employees, under which the subsidiaries of the Company may be required to indemnify such persons for liabilities arising out of their employment relationships. The terms of such obligations vary by contract and, in most instances, a specific or maximum dollar amount is not explicitly stated therein. Generally, amounts under these contracts cannot be reasonably estimated until a specific claim is asserted. Consequently, because no claims have been asserted, no liabilities have been recorded for these obligations on the Company’s Condensed Consolidated Balance Sheets for any of the periods presented. Litigation - The Company’s businesses involve a significant risk of liability given the age and health of the patients and residents served by its independent operating subsidiaries. The Company, its operating companies, and others in the industry may be subject to a number of claims and lawsuits, including professional liability claims, alleging that services provided have resulted in personal injury, elder abuse, wrongful death or other related claims. Healthcare litigation (including class action litigation) is common and is filed based upon a wide variety of claims and theories, and the Company is routinely subjected to these claims in the ordinary course of business, including potential claims related to patient care and treatment, and professional negligence, as well as employment-related claims. If there were a significant increase in the number of these claims or an increase in amounts owing should plaintiffs be successful in their prosecution of these claims, this could materially adversely affect the Company’s business, financial condition, results of operations and cash flows. In addition, the defense of these lawsuits may result in significant legal costs, regardless of the outcome, and may result in large settlement amounts or damage awards. In addition to the potential lawsuits and claims described above, the Company also is subject to potential lawsuits under the False Claims Act (the “FCA”) and comparable state laws alleging submission of fraudulent claims for services to any governmental healthcare program (such as Medicare) or commercial payor. A violation may provide the basis for exclusion from federally funded healthcare programs. Such exclusions could have a correlative negative impact on the Company’s financial performance. Some states, including California, Arizona and Texas, have enacted similar whistleblower and false claims laws and regulations. In addition, the Deficit Reduction Act of 2005 created incentives for states to enact anti-fraud legislation modeled on the FCA, for which 18 states have qualified, including California and Texas, where we conduct business. As such, the Company could face scrutiny, potential liability and legal expenses and costs based on claims under state false claims acts in markets in which it conducts business. Under the Fraud Enforcement and Recovery Act (“FERA”) and its associated rules, healthcare providers face significant penalties for the knowing retention of government overpayments, even if no false claim was involved. Providers have an obligation to proactively exercise “reasonable diligence” to identify overpayments and return those overpayments to CMS within 60 days of “identification” or the date any corresponding cost report is due, whichever is later. Retention of overpayments beyond this period may create liability under the FCA. In addition, FERA protects whistleblowers (including employees, contractors, and agents) from retaliation. The Company cannot predict or provide any assurance as to the possible outcome of any litigation. If any litigation were to proceed, and the Company and its operating companies are subjected to, alleged to be liable for, or agree to a settlement of, claims or obligations under federal Medicare statutes, the FCA, or similar state and federal statutes and related regulations, the Company’s business, financial condition and results of operations and cash flows could be materially and adversely affected. Among other things, any settlement or litigation could involve the payment of substantial sums to settle any alleged civil violations, and may also include the assumption of specific procedural and financial obligations by the Company or its independent operating subsidiaries going forward under a corporate integrity agreement and/or other arrangement with the government. Medicare Revenue Recoupments - The Company is subject to probe reviews relating to Medicare services, billings and potential overpayments by Unified Program Integrity Contractors (“UPIC”), Recovery Audit Contractors (“RAC”), Zone Program Integrity Contractors (“ZPIC”), Program Safeguard Contractors (“PSC”), Supplemental Medical Review Contractors (“SMRC”) and Medicaid Integrity Contributors (“MIC”) programs, each of the foregoing collectively referred to as “Reviews.” As of June 30, 2023, ten of the Company’s independent operating subsidiaries had Reviews scheduled, on appeal or in dispute resolution process, both pre- and post-payment. If an operation fails an initial or subsequent Review, the operation could then be subject to extended Review, suspension of payment, or extrapolation of the identified error rate to all billing in the same time period. The Company, from time to time, receives record requests in Reviews which have resulted in claim denials on previously paid claims. The Company has appealed substantially all denials arising from these Reviews using the applicable appeals process. As of June 30, 2023, and through the filing of this Quarterly Report on Form 10-Q, the Company’s independent operating subsidiaries have responded to the Reviews that are currently ongoing, on appeal or in dispute resolution process. The Company cannot predict the ultimate outcome of any regulatory and other governmental Reviews. While such Reviews are the subject of administrative appeals, the appeals process, even if successful, may take several years to resolve. The costs to respond to and defend such Reviews may be significant and an adverse determination in such Reviews may subject the Company to sanctions, damages, extrapolation of damage findings, additional recoupments, fines, other penalties (some of which may not be covered by insurance), and termination from Medicare programs which may, either individually or in the aggregate, have a material adverse effect on the Company's business and financial condition. From June 2021 to May 2022, one hospice provider number was subject to a Medicare payment suspension imposed by a UPIC. As of June 30, 2023, the total amount due from the government payor impacted by the suspension was $5,105 and was recorded in long-term other assets. The amounts suspended represent all Medicare payments due to the provider number during the suspension. In May 2022, the Company received communication that the Medicare payment suspension, for the above-referenced hospice provider number, was terminated and the UPIC’s review was complete. The UPIC reviewed 107 patient records covering a 10-month period to determine whether, in its view, a Medicare overpayment was made. Based on the results of the review, the UPIC has alleged sampled and extrapolated overpayments of $5,105, and has withheld that amount through continued recoupment of Medicare payments. The Company is pursuing its appeal rights through the administrative appeals process, including contesting the methodology used by the UPIC to perform statistical extrapolation. To date the Company has been successful in appealing some of the previously denied claims and expects to receive refunds related to the successful appeals. The Company continues to work through the appeals process for the remaining denied claims. Based on the information currently available to the Company, the Company cannot predict the timing or the ultimate outcome of this review including refunds to be received. As of June 30, 2023, the Company has an accrued liability that is immaterial for this review which was recorded as an offset to revenue. Insurance - The Company retains risk for a substantial portion of potential claims for general and professional liability, workers’ compensation and automobile liability. The Company recognizes obligations associated with these costs, up to specified deductible limits in the period in which a claim is incurred, including with respect to both reported claims and claims incurred but not reported. The general and professional liability insurance has a retention limit of $150 per claim with a $500 corridor as an additional out-of-pocket retention we must satisfy for claims within the policy year before the carrier will reimburse losses. The workers’ compensation insurance has a retention limit of $250 per claim, except for policies held in Texas, Washington and Wyoming which are subject to state insurance and possess their own limits.

COMMON STOCK REPURCHASE PROGRAM

COMMON STOCK REPURCHASE PROGRAM	6 Months Ended
	Jun. 30, 2023
Equity [Abstract]
COMMON STOCK REPURCHASE PROGRAM	COMMON STOCK REPURCHASE PROGRAMOn December 12, 2022, the Board of Directors of the Company approved a share repurchase program under which the Company may repurchase up to $1,000 of its common stock. Under the share repurchase program, the Company may repurchase shares from time to time through open market purchases, including through the use of trading plans intended to comply with Rule 10b5-1 under the Securities Exchange Act of 1934. The timing and total amount of stock repurchases will depend upon business, economic and market conditions, corporate and regulatory requirements, prevailing stock prices, and other considerations. The authorization expires on December 12, 2023, and may be suspended or discontinued at any time and does not obligate the Company to acquire any amount of common stock. No shares were repurchased during the three and six months ended June 30, 2023.

BASIS OF PRESENTATION AND SUM_2

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2023
Accounting Policies [Abstract]
Basis of Presentation	The accompanying unaudited condensed consolidated financial statements of the Company (the “Interim Financial Statements”) reflect the Company’s financial position, results of operations and cash flows of the business. The Interim Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and pursuant to the regulations of the Securities and Exchange Commission (“SEC”). Management believes that the Interim Financial Statements reflect, in all material respects, all adjustments which are of a normal and recurring nature necessary to present fairly the Company’s financial position, results of operations, and cash flows for the periods presented in conformity with GAAP. The results reported in these Interim Financial Statements are not necessarily indicative of results that may be expected for the entire year.
Consolidation	The Company consists of various limited liability companies and corporations established to operate home health, hospice, home care, and senior living operations. The Interim Financial Statements include the accounts of all entities controlled by the Company through its ownership of a majority voting interest.
Estimates and Assumptions	The preparation of the Interim Financial Statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Interim Financial Statements and the reported amounts of revenue and expenses during the reporting periods. The most significant estimates in the Interim Financial Statements relate to revenue, intangible assets and goodwill, right-of-use assets and lease liabilities for leases greater than 12 months, self-insurance reserves, and income taxes. Actual results could differ from those estimates.
Revenue Recognition	Revenue is recognized when services are provided to the patients at the amount that reflects the consideration to which the Company expects to be entitled from patients and third-party payors, including Medicare, Medicaid, Commercial and managed care programs (Medicare Advantage and Managed Medicaid plans), in exchange for providing patient care. The healthcare services in home health and hospice patient contracts include routine services in exchange for a contractual agreed-upon amount or rate. Routine services are treated as a single performance obligation satisfied over time as services are rendered. As such, patient care services represent a bundle of services that are not capable of being distinct within the context of the contract. Additionally, there may be ancillary services which are not included in the rates for routine services, but instead are treated as separate performance obligations satisfied at a point in time, if and when those services are rendered.Revenue recognized from healthcare services are adjusted for estimates of variable consideration to arrive at the transaction price. The Company determines the transaction price based on contractually agreed-upon amounts or rates, adjusted for estimates of variable consideration. The Company uses the expected value method in determining the variable component that should be used to arrive at the transaction price, using contractual agreements and historical reimbursement experience within each payor type. The amount of variable consideration which is included in the transaction price may be constrained, and is included in the net revenue only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. If actual amounts of consideration ultimately received differ from the Company’s estimates, the Company adjusts these estimates, which would affect net service revenue in the period such variances become known. Medicare Revenue Net service revenue is recognized in accordance with the Patient Driven Groupings Model (“PDGM”). Under PDGM, Medicare provides agencies with payments for each 30-day payment period provided to beneficiaries. If a beneficiary is still eligible for care after the end of the first 30-day payment period, a second 30-day payment period can begin. There are no limits to the number of periods of care a beneficiary who remains eligible for the home health benefit can receive. While payment for each 30-day payment period is adjusted to reflect the beneficiary’s health condition and needs, a special outlier provision exists to ensure appropriate payment for those beneficiaries that have the most expensive care needs. The payment under the Medicare program is also adjusted for certain variables including, but not limited to: (a) a low utilization payment adjustment if the number of visits is below an established threshold that varies based on the diagnosis of a beneficiary; (b) a partial payment if the patient transferred to another provider or the Company received a patient from another provider before completing the period of care; (c) adjustment to the admission source of claim if it is determined that the patient had a qualifying stay in a post-acute care setting within 14 days prior to the start of a 30-day payment period; (d) the timing of the 30-day payment period provided to a patient in relation to the admission date, regardless of whether the same home health provider provided care for the entire series of episodes; (e) changes to the acuity of the patient during the previous 30-day payment period; (f) changes in the base payments established by the Medicare program; (g) adjustments to the base payments for case mix and geographic wages; and (h) recoveries of overpayments. The Company adjusts Medicare revenue on completed episodes to reflect differences between estimated and actual payment amounts, an inability to obtain appropriate billing documentation and other reasons unrelated to credit risk. Therefore, the Company believes that its reported net service revenue and patient accounts receivable will be the net amounts to be realized from Medicare for services rendered. In addition to revenue recognized on completed episodes and periods, the Company also recognizes a portion of revenue associated with episodes and periods in progress. Episodes in progress are 30-day payment periods that begin during the reporting period but were not completed as of the end of the period. As such, the Company estimates revenue and recognizes it on a daily basis. The primary factors underlying this estimate are the number of episodes in progress at the end of the reporting period, expected Medicare revenue per period of care or episode of care and the Company’s estimate of the average percentage complete based on the scheduled end of period and end of episode dates. Non-Medicare Revenue Episodic Based Revenue - The Company recognizes revenue in a similar manner as it recognizes Medicare revenue for episodic-based rates that are paid by other insurance carriers, including Medicare Advantage programs. These rates can vary based upon the negotiated terms. Non-episodic Based Revenue - Revenue is recognized on an accrual basis based upon the date of service at amounts equal to its established or estimated per visit rates, as applicable. Hospice Revenue Revenue is recognized on an accrual basis based upon the date of service at amounts equal to the estimated payment rates. The estimated payment rates are calculated as daily rates for each of the levels of care the Company delivers. Revenue is adjusted for an inability to obtain appropriate billing documentation or authorizations acceptable to the payor and other reasons unrelated to credit risk. Additionally, as Medicare hospice revenue is subject to an inpatient cap and an overall payment cap, the Company monitors its provider numbers and estimates amounts due back to Medicare if a cap has been exceeded. The Company regularly evaluates and records these adjustments as a reduction to revenue and an increase to other accrued liabilities. Senior Living Revenue The Company has elected the lessor practical expedient within ASC Topic 842, Leases and therefore recognizes, measures, presents, and discloses the revenue for services rendered under the Company’s senior living residency agreements based upon the predominant component, either the lease or non-lease component, of the contracts. The Company has determined that the services included under the Company’s senior living residency agreements each have the same timing and pattern of transfer. The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customers for its senior residency agreements, for which it has determined that the non-lease components of such residency agreements are the predominant component of each such contract.

NET INCOME (LOSS) PER COMMON _2

NET INCOME (LOSS) PER COMMON SHARE (Tables)	6 Months Ended
	Jun. 30, 2023
Earnings Per Share [Abstract]
Schedule of basic and diluted net income (loss) per share	The following table sets forth the computation of basic and diluted net income (loss) per share for the periods presented: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Numerator: Net income (loss) attributable to The Pennant Group, Inc. $ 2,797 $ (2,676) $ 4,647 $ (1,662) Denominator: Weighted average shares outstanding for basic net income per share 29,809 28,605 29,780 28,589 Plus: assumed incremental shares from exercise of options and assumed conversion or vesting of restricted stock (a) 384 — 391 — Adjusted weighted average common shares outstanding for diluted income per share 30,193 28,605 30,171 28,589 Earnings Per Share: Basic net income (loss) per common share $ 0.09 $ (0.09) $ 0.16 $ (0.06) Diluted net income (loss) per common share $ 0.09 $ (0.09) $ 0.15 $ (0.06) (a) The diluted per share amounts do not reflect common equivalent shares outstanding of 2,312 and 2,158 for the three and six months ended June 30, 2023, respectively, and 3,832 and 3,806 for the three and six months ended June 30, 2022, respectively, because of their anti-dilutive effect.

REVENUE AND ACCOUNTS RECEIVAB_2

REVENUE AND ACCOUNTS RECEIVABLE (Tables)	6 Months Ended
	Jun. 30, 2023
Revenue from Contract with Customer [Abstract]
Schedule of revenue by major payor source	Revenue by payor for the three months ended June 30, 2023 and 2022, is summarized in the following tables: Three Months Ended June 30, 2023 Home Health and Hospice Services Home Health Services Hospice Services Senior Living Services Total Revenue Revenue % Medicare $ 23,920 $ 40,294 $ — $ 64,214 48.5 % Medicaid 2,466 4,682 11,783 18,931 14.3 Subtotal 26,386 44,976 11,783 83,145 62.8 Managed care 15,837 1,417 — 17,254 13.1 Private and other (a) 6,235 169 25,478 31,882 24.1 Total revenue $ 48,458 $ 46,562 $ 37,261 $ 132,281 100.0 % (a) Private and other payors in the Company’s home health and hospice services segment includes revenue from all payors generated in the Company’s home care operations. Three Months Ended June 30, 2022 Home Health and Hospice Services Home Health Services Hospice Services Senior Living Services Total Revenue Revenue % Medicare $ 23,464 $ 34,234 $ — $ 57,698 49.6 % Medicaid 2,732 3,859 8,752 15,343 13.2 Subtotal 26,196 38,093 8,752 73,041 62.8 Managed care 14,260 1,153 — 15,413 13.3 Private and other (a) 5,529 113 22,220 27,862 23.9 Total revenue $ 45,985 $ 39,359 $ 30,972 $ 116,316 100.0 % (a) Private and other payors in the Company’s home health and hospice services segment includes revenue from all payors generated in the Company’s home care operations. Revenue by payor for the six months ended June 30, 2023 and 2022, is summarized in the following tables: Six Months Ended June 30, 2023 Home Health and Hospice Services Home Health Services Hospice Services Senior Living Services Total Revenue Revenue % Medicare $ 47,296 $ 77,674 $ — $ 124,970 48.3 % Medicaid 4,657 9,280 22,625 36,562 14.1 Subtotal 51,953 86,954 22,625 161,532 62.4 Managed care 31,769 2,611 — 34,380 13.3 Private and other (a) 12,526 286 50,021 62,833 24.3 Total revenue $ 96,248 $ 89,851 $ 72,646 $ 258,745 100.0 % (a) Private and other payors in the Company’s home health and hospice services segment includes revenue from all payors generated in the Company’s home care operations. Six Months Ended June 30, 2022 Home Health and Hospice Services Home Health Services Hospice Services Senior Living Services Total Revenue Revenue % Medicare $ 44,821 $ 67,955 $ — $ 112,776 49.0 % Medicaid 5,238 7,124 18,375 30,737 13.4 Subtotal 50,059 75,079 18,375 143,513 62.4 Managed care 27,512 1,937 — 29,449 12.7 Private and other (a) 11,066 166 46,032 57,264 24.9 Total revenue $ 88,637 $ 77,182 $ 64,407 $ 230,226 100.0 % (a) Private and other payors in the Company’s home health and hospice services segment includes revenue from all payors generated in the Company’s home care operations.
Schedule of accounts receivable	Accounts receivable, net as of June 30, 2023 and December 31, 2022 is summarized in the following table: June 30, 2023 December 31, 2022 Medicare $ 32,516 $ 31,321 Medicaid 13,216 10,700 Managed care 9,705 9,370 Private and other 2,772 2,621 Accounts receivable, gross 58,209 54,012 Less: allowance for doubtful accounts (957) (592) Accounts receivable, net $ 57,252 $ 53,420

BUSINESS SEGMENTS (Tables)

BUSINESS SEGMENTS (Tables)	6 Months Ended
	Jun. 30, 2023
Segment Reporting [Abstract]
Schedule of financial data combined by business segment	The following tables present certain financial information regarding the Company’s reportable segments, general and administrative expenses are not allocated to the reportable segments and are included in “All Other” for the three and six months ended June 30, 2023 and 2022: Home Health and Hospice Services Senior Living Services All Other Total Three Months Ended June 30, 2023 Revenue $ 95,020 $ 37,261 $ — $ 132,281 Segment Adjusted EBITDAR from Operations $ 15,681 $ 11,680 $ (7,885) $ 19,476 Three Months Ended June 30, 2022 Revenue $ 85,344 $ 30,972 $ — $ 116,316 Segment Adjusted EBITDAR from Operations $ 15,728 $ 8,771 $ (7,870) $ 16,629 Home Health and Hospice Services Senior Living Services All Other Total Six Months Ended June 30, 2023 Revenue $ 186,099 $ 72,646 $ — $ 258,745 Segment Adjusted EBITDAR from Operations $ 30,093 $ 21,921 $ (15,399) $ 36,615 Six Months Ended June 30, 2022 Revenue $ 165,819 $ 64,407 $ — $ 230,226 Segment Adjusted EBITDAR from Operations $ 29,676 $ 18,203 $ (16,016) $ 31,863
Schedule of reconciliation of total combined adjusted EBITDAR from operations for our reportable segments to combined income from operations	The following table provides a reconciliation of Segment Adjusted EBITDAR from Operations to income from operations: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Segment Adjusted EBITDAR from Operations $ 19,476 $ 16,629 $ 36,615 $ 31,863 Less: Depreciation and amortization 1,214 1,279 2,494 2,426 Rent—cost of services 9,836 9,078 19,433 19,129 Other expense 35 (35) 65 (32) Adjustments to Segment EBITDAR from Operations: Less: Costs at start-up operations (a) 65 377 268 508 Share-based compensation expense and related taxes (b) 1,354 2,380 2,773 4,820 Acquisition related costs and credit allowances (c) 72 14 104 14 Costs associated with transitioning operations (d) 538 6,691 585 5,934 Unusual, non-recurring or redundant charges (e) 226 40 624 77 Add: Net income attributable to noncontrolling interest 125 80 272 224 Condensed Consolidated Income (Loss) from Operations $ 6,261 $ (3,115) $ 10,541 $ (789) (a) Represents results related to start-up operations. This amount excludes rent and depreciation and amortization expense related to such operations. (b) Share-based compensation expense and related payroll taxes incurred. Share-based compensation expense and related payroll taxes are included in cost of services and general and administrative expense. (c) Non-capitalizable costs associated with acquisitions and credit allowances for amounts in dispute with the prior owners of certain acquired operations. (d) During the six months ended June 30, 2023, an affiliate of the Company placed its memory care units into transition and is actively seeking to sublease the units to an unrelated third party. The amount above represents the net operating impact attributable to the units in transition. The amounts reported exclude rent and depreciation and amortization expense related to such operations and include legal settlement costs associated with one of the entities transitioned to Ensign. During January 2022, affiliates of the Company entered into Transfer Agreements with affiliates of Ensign, providing for the transfer of the operations of certain senior living communities (the “Transaction”) from affiliates of the Company to affiliates of Ensign. The closing of the Transaction was completed in two phases with the transfer of two operations on March 1, 2022 and the remainder transferred on April 1, 2022. The amount above represents the net impact on revenue and cost of service attributable to all of the transferred entities. The amounts reported exclude rent and depreciation and amortization expense related to such operations. (e) Represents unusual or non-recurring charges for legal services, implementation costs, integration costs, and consulting fees in general and administrative expenses. Costs identified as redundant or non-recurring incurred by the Company for additional services provided by Ensign. All amounts are included in general and administrative expense. Fees incurred were $192 and $465 for the three and six months ended June 30, 2023, respectively, and $458 and $1,101 for the three and six months ended June 30, 2022, respectively.

PROPERTY AND EQUIPMENT_NET (Tab

PROPERTY AND EQUIPMENT—NET (Tables)	6 Months Ended
	Jun. 30, 2023
Property, Plant and Equipment [Abstract]
Schedule of property and equipment, net	Property and equipment, net consist of the following: June 30, 2023 December 31, 2022 Land $ 96 $ 96 Building 1,890 1,890 Leasehold improvements 19,670 18,759 Equipment 27,559 25,532 Furniture and fixtures 1,217 1,151 50,432 47,428 Less: accumulated depreciation (23,180) (20,807) Property and equipment, net $ 27,252 $ 26,621

GOODWILL AND OTHER INDEFINITE_2

GOODWILL AND OTHER INDEFINITE-LIVED INTANGIBLE ASSETS (Tables)	6 Months Ended
	Jun. 30, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of activity in goodwill by segment	The following table represents activity in goodwill by segment for the six months ended June 30, 2023: Home Health and Hospice Services Senior Living Services Total December 31, 2022 $ 75,855 $ 3,642 $ 79,497 Additions 4,117 — 4,117 June 30, 2023 $ 79,972 $ 3,642 $ 83,614
Schedule of other indefinite-lived intangible assets	Other indefinite-lived intangible assets consist of the following: June 30, 2023 December 31, 2022 Trade name $ 1,571 $ 1,385 Medicare and Medicaid licenses 59,454 57,232 Total $ 61,025 $ 58,617

OTHER ACCRUED LIABILITIES (Tabl

OTHER ACCRUED LIABILITIES (Tables)	6 Months Ended
	Jun. 30, 2023
Payables and Accruals [Abstract]
Schedule of other accrued liabilities	Other accrued liabilities consist of the following: June 30, 2023 December 31, 2022 Refunds payable $ 2,122 $ 2,244 Deferred revenue 1,819 1,592 Resident deposits 3,040 4,315 Property taxes 975 1,027 Deferred state relief funds 1,469 1,479 Accrued self-insurance liabilities 4,231 3,546 Other 2,524 2,481 Other accrued liabilities $ 16,180 $ 16,684

DEBT (Tables)

DEBT (Tables)	6 Months Ended
	Jun. 30, 2023
Debt Disclosure [Abstract]
Schedule of long-term debt	Long-term debt, net consists of the following: June 30, 2023 December 31, 2022 Revolving Credit Facility $ 60,500 $ 64,500 Less: unamortized debt issuance costs (a) (1,347) (1,608) Long-term debt, net $ 59,153 $ 62,892 (a) Amortization expense for debt issuance costs was $130 and $261 for the three and six months ended June 30, 2023, respectively, and $130 and $260 for the three and six months ended June 30, 2022, respectively, and is recorded in interest expense, net on the Condensed Consolidated Statements of Income.

OPTIONS AND AWARDS (Tables)

OPTIONS AND AWARDS (Tables)	6 Months Ended
	Jun. 30, 2023
Share-Based Payment Arrangement [Abstract]
Schedule of total share-based compensation expense	Total share-based compensation expense for all Plans for the three and six months ended June 30, 2023 and 2022 was: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Share-based compensation expense related to stock options $ 984 779 $ 1,834 $ 1,621 Share-based compensation expense related to Restricted Stock 180 1,502 357 3,021 Share-based compensation expense related to Restricted Stock to non-employee directors 139 99 479 178 Total share-based compensation $ 1,303 $ 2,380 $ 2,670 $ 4,820 In future periods, the Company estimates it will recognize the following share-based compensation expense for unvested stock options and unvested Restricted Stock as of June 30, 2023: Unrecognized Compensation Expense Weighted Average Recognition Period Unvested Stock Options $ 12,296 3.5 Unvested Restricted Stock 2,751 4.0 Total unrecognized share-based compensation expense $ 15,047
Schedule of stock options granted fair value assumptions	The fair value of each option is estimated on the grant date using a Black-Scholes option-pricing model with the following weighted average assumptions for stock options granted as of June 30: Grant Year Options Granted Risk-Free Interest Rate Expected Life (a) Expected Volatility (b) Dividend Yield Weighted Average Fair Value of Options 2023 656 4.0 % 6.5 41.6 % — % $ 6.78 2022 298 2.2 % 6.5 39.9 % — % $ 6.60 (a) Under the midpoint method, the expected option life is the midpoint between the contractual option life and the average vesting period for the options being granted. This resulted in an expected option life of 6.5 years for the options granted. (b) Because the Company’s equity shares have been traded for a relatively short period of time, expected volatility assumption was based on the volatility of related industry stocks.
Schedule of employee stock option activity	The following table represents the employee stock option activity during the six months ended June 30, 2023: Number of Options Outstanding Weighted Number of Options Vested Weighted Average Exercise Price of Options Vested December 31, 2022 2,219 20.76 973 $ 16.90 Granted 656 14.03 Exercised (63) 7.18 Forfeited (37) 22.22 Expired (34) 20.13 June 30, 2023 2,741 $ 19.29 1,054 $ 18.17
Schedule of non-vested restricted stock awards	A summary of the status of Pennant’s non-vested Restricted Stock, and changes during the six months ended June 30, 2023, is presented below: Non-Vested Restricted Stock Weighted Average Grant Date Fair Value December 31, 2022 418 $ 14.26 Granted 42 11.42 Vested (78) 12.53 Forfeited (3) 15.30 June 30, 2023 379 $ 14.29

LEASES (Tables)

LEASES (Tables)	6 Months Ended
	Jun. 30, 2023
Leases [Abstract]
Schedule of operating lease cost	The components of operating lease cost, are as follows: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Operating Lease Costs: Community Rent—cost of services $ 8,462 $ 7,837 $ 16,736 $ 16,626 Office Rent—cost of services 1,374 1,241 2,697 2,503 Rent—cost of services $ 9,836 $ 9,078 $ 19,433 $ 19,129 General and administrative expense $ 104 $ 74 $ 197 $ 155 Variable lease cost (a) $ 1,761 $ 1,298 $ 3,491 $ 2,873 (a) Represents variable lease cost for operating leases, which costs include property taxes and insurance, common area maintenance, and consumer price index increases, incurred as part of the Company’s triple net lease, and which is included in cost of services for the three and six months ended June 30, 2023 and 2022.
Schedule of future minimum lease payments	The following table shows the lease maturity analysis for all leases as of June 30, 2023, for the years ended December 31: Year Amount 2023 (Remainder) $ 18,300 2024 35,913 2025 34,543 2026 33,441 2027 32,778 Thereafter 253,655 Total lease payments 408,630 Less: present value adjustments (144,911) Present value of total lease liabilities 263,719 Less: current lease liabilities (17,412) Long-term operating lease liabilities $ 246,307

DESCRIPTION OF BUSINESS (Detail

DESCRIPTION OF BUSINESS (Details) - Jun. 30, 2023	facility	agency
Home Health and Hospice Services
Segment Reporting Information [Line Items]
Number of service providers		101
Senior Living Services
Segment Reporting Information [Line Items]
Number of properties under lease	51	51

BASIS OF PRESENTATION AND SUM_3

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022	Dec. 31, 2020
Unusual or Infrequent Item, or Both [Line Items]
Deferred state relief funds	$ 1,469		$ 1,469		$ 1,479
State relief funds, reduction	$ 1,397	$ 584	$ 2,082	$ 1,246
CARES Act
Unusual or Infrequent Item, or Both [Line Items]
Accrued payroll taxes employer portion					$ 7,836
The coronavirus aid, relief, and economic security act, advance payments received						$ 27,997

TRANSACTIONS WITH ENSIGN (Detai

TRANSACTIONS WITH ENSIGN (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023 USD ($) facility	Jun. 30, 2022 USD ($) property	Jun. 30, 2023 USD ($) facility	Jun. 30, 2022 USD ($) property	Jun. 30, 2023 agency	Jun. 30, 2023 property	Jan. 27, 2022 USD ($) facility
Affiliates of Ensign
Related Party Transaction [Line Items]
Escrow deposits							$ 6,500
Senior Living Services
Related Party Transaction [Line Items]
Number of properties under lease	51		51		51
Related party
Related Party Transaction [Line Items]
Cost of services	$ 1,014	$ 648	$ 1,954	$ 1,223
Related party | Senior Living Services
Related Party Transaction [Line Items]
Number of operating facilities | property		29		29		29
Number of properties under lease | facility							5
Number of communities | facility							1
Related party | Transition Services Agreement
Related Party Transaction [Line Items]
Expenses from transactions with related party	$ 192	$ 458	$ 465	$ 1,101

NET INCOME (LOSS) PER COMMON _3

NET INCOME (LOSS) PER COMMON SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022
Numerator:
Net income (loss) attributable to The Pennant Group, Inc.	$ 2,797	$ 1,850	$ (2,676)	$ 1,014	$ 4,647	$ (1,662)
Denominator:
Weighted average shares outstanding for basic net income per share (in shares)	29,809		28,605		29,780	28,589
Plus: assumed incremental shares from exercise of options and assumed conversion or vesting of restricted stock (in shares)	384		0		391	0
Adjusted weighted average common shares outstanding for diluted income per share (in shares)	30,193		28,605		30,171	28,589
Earnings Per Share:
Basic net income (loss) per common share (in dollars per share)	$ 0.09		$ (0.09)		$ 0.16	$ (0.06)
Diluted net income (loss) per common share (in dollars per share)	$ 0.09		$ (0.09)		$ 0.15	$ (0.06)
Anti-dilutive effect of common equivalent shares outstanding (in shares)	2,312		3,832		2,158	3,806

REVENUE AND ACCOUNTS RECEIVAB_3

REVENUE AND ACCOUNTS RECEIVABLE - NARRATIVE (Details)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Disaggregation of Revenue [Line Items]
Payment terms			Residency agreements are generally for a term of 30 days, with resident fees billed monthly in advance. For residents under reimbursement arrangements with Medicaid, revenue is recorded based on contractually agreed-upon amounts or rates on a per resident, daily basis or as services are rendered.
Customer concentration risk | Revenue
Disaggregation of Revenue [Line Items]
Revenue, percent	100%	100%	100%	100%
Customer concentration risk | Revenue | Subtotal
Disaggregation of Revenue [Line Items]
Revenue, percent	62.80%	62.80%	62.40%	62.40%
Customer concentration risk | Receivables | Subtotal
Disaggregation of Revenue [Line Items]
Revenue, percent			78.60%		77.80%

REVENUE AND ACCOUNTS RECEIVAB_4

REVENUE AND ACCOUNTS RECEIVABLE - REVENUE BY MAJOR PAYOR (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Disaggregation of Revenue [Line Items]
Revenue	$ 132,281	$ 116,316	$ 258,745	$ 230,226
Revenue | Customer concentration risk
Disaggregation of Revenue [Line Items]
Revenue %	100%	100%	100%	100%
Medicare
Disaggregation of Revenue [Line Items]
Revenue	$ 64,214	$ 57,698	$ 124,970	$ 112,776
Medicare | Revenue | Customer concentration risk
Disaggregation of Revenue [Line Items]
Revenue %	48.50%	49.60%	48.30%	49%
Medicaid
Disaggregation of Revenue [Line Items]
Revenue	$ 18,931	$ 15,343	$ 36,562	$ 30,737
Medicaid | Revenue | Customer concentration risk
Disaggregation of Revenue [Line Items]
Revenue %	14.30%	13.20%	14.10%	13.40%
Subtotal
Disaggregation of Revenue [Line Items]
Revenue	$ 83,145	$ 73,041	$ 161,532	$ 143,513
Subtotal | Revenue | Customer concentration risk
Disaggregation of Revenue [Line Items]
Revenue %	62.80%	62.80%	62.40%	62.40%
Managed care
Disaggregation of Revenue [Line Items]
Revenue	$ 17,254	$ 15,413	$ 34,380	$ 29,449
Managed care | Revenue | Customer concentration risk
Disaggregation of Revenue [Line Items]
Revenue %	13.10%	13.30%	13.30%	12.70%
Private and other
Disaggregation of Revenue [Line Items]
Revenue	$ 31,882	$ 27,862	$ 62,833	$ 57,264
Private and other | Revenue | Customer concentration risk
Disaggregation of Revenue [Line Items]
Revenue %	24.10%	23.90%	24.30%	24.90%
Home Health and Hospice Services | Home Health Services
Disaggregation of Revenue [Line Items]
Revenue	$ 48,458	$ 45,985	$ 96,248	$ 88,637
Home Health and Hospice Services | Home Health Services | Medicare
Disaggregation of Revenue [Line Items]
Revenue	23,920	23,464	47,296	44,821
Home Health and Hospice Services | Home Health Services | Medicaid
Disaggregation of Revenue [Line Items]
Revenue	2,466	2,732	4,657	5,238
Home Health and Hospice Services | Home Health Services | Subtotal
Disaggregation of Revenue [Line Items]
Revenue	26,386	26,196	51,953	50,059
Home Health and Hospice Services | Home Health Services | Managed care
Disaggregation of Revenue [Line Items]
Revenue	15,837	14,260	31,769	27,512
Home Health and Hospice Services | Home Health Services | Private and other
Disaggregation of Revenue [Line Items]
Revenue	6,235	5,529	12,526	11,066
Home Health and Hospice Services | Hospice Services
Disaggregation of Revenue [Line Items]
Revenue	46,562	39,359	89,851	77,182
Home Health and Hospice Services | Hospice Services | Medicare
Disaggregation of Revenue [Line Items]
Revenue	40,294	34,234	77,674	67,955
Home Health and Hospice Services | Hospice Services | Medicaid
Disaggregation of Revenue [Line Items]
Revenue	4,682	3,859	9,280	7,124
Home Health and Hospice Services | Hospice Services | Subtotal
Disaggregation of Revenue [Line Items]
Revenue	44,976	38,093	86,954	75,079
Home Health and Hospice Services | Hospice Services | Managed care
Disaggregation of Revenue [Line Items]
Revenue	1,417	1,153	2,611	1,937
Home Health and Hospice Services | Hospice Services | Private and other
Disaggregation of Revenue [Line Items]
Revenue	169	113	286	166
Senior Living Services
Disaggregation of Revenue [Line Items]
Revenue	37,261	30,972	72,646	64,407
Senior Living Services | Medicare
Disaggregation of Revenue [Line Items]
Revenue	0	0	0	0
Senior Living Services | Medicaid
Disaggregation of Revenue [Line Items]
Revenue	11,783	8,752	22,625	18,375
Senior Living Services | Subtotal
Disaggregation of Revenue [Line Items]
Revenue	11,783	8,752	22,625	18,375
Senior Living Services | Managed care
Disaggregation of Revenue [Line Items]
Revenue	0	0	0	0
Senior Living Services | Private and other
Disaggregation of Revenue [Line Items]
Revenue	$ 25,478	$ 22,220	$ 50,021	$ 46,032

REVENUE AND ACCOUNTS RECEIVAB_5

REVENUE AND ACCOUNTS RECEIVABLE - ACCOUNTS RECEIVABLE (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Accounts Receivable [Abstract]
Accounts receivable, gross	$ 58,209	$ 54,012
Less: allowance for doubtful accounts	(957)	(592)
Accounts receivable, net	57,252	53,420
Medicare
Accounts Receivable [Abstract]
Accounts receivable, gross	32,516	31,321
Medicaid
Accounts Receivable [Abstract]
Accounts receivable, gross	13,216	10,700
Managed care
Accounts Receivable [Abstract]
Accounts receivable, gross	9,705	9,370
Private and other
Accounts Receivable [Abstract]
Accounts receivable, gross	$ 2,772	$ 2,621

BUSINESS SEGMENTS - NARRATIVE (

BUSINESS SEGMENTS - NARRATIVE (Details) - Jun. 30, 2023	facility	agency
Home Health and Hospice Services
Segment Reporting Information [Line Items]
Number of service providers		101
Senior Living Services
Segment Reporting Information [Line Items]
Number of properties under lease	51	51

BUSINESS SEGMENTS - FINANCIAL D

BUSINESS SEGMENTS - FINANCIAL DATA (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Segment Reporting Information [Line Items]
Revenue	$ 132,281	$ 116,316	$ 258,745	$ 230,226
Segment Adjusted EBITDAR from Operations	19,476	16,629	36,615	31,863
Senior Living Services
Segment Reporting Information [Line Items]
Revenue	37,261	30,972	72,646	64,407
Operating segments | Home Health and Hospice Services
Segment Reporting Information [Line Items]
Revenue	95,020	85,344	186,099	165,819
Segment Adjusted EBITDAR from Operations	15,681	15,728	30,093	29,676
Operating segments | Senior Living Services
Segment Reporting Information [Line Items]
Revenue	37,261	30,972	72,646	64,407
Segment Adjusted EBITDAR from Operations	11,680	8,771	21,921	18,203
All Other
Segment Reporting Information [Line Items]
Revenue	0	0	0	0
Segment Adjusted EBITDAR from Operations	$ (7,885)	$ (7,870)	$ (15,399)	$ (16,016)

BUSINESS SEGMENTS - INCOME FROM

BUSINESS SEGMENTS - INCOME FROM OPERATIONS (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022
Revenue, Major Customer [Line Items]
Segment Adjusted EBITDAR from Operations	$ 19,476		$ 16,629		$ 36,615	$ 31,863
Less: Depreciation and amortization	1,214		1,279		2,494	2,426
Rent—cost of services	9,836		9,078		19,433	19,129
Other expense	35		(35)		65	(32)
Less: Costs at start-up operations	65		377		268	508
Share-based compensation expense and related taxes	1,354		2,380		2,773	4,820
Acquisition related costs and credit allowances	72		14		104	14
Costs associated with transitioning operations	538		6,691		585	5,934
Unusual, non-recurring or redundant charges	226		40		624	77
Add: Net income attributable to noncontrolling interest	125	$ 147	80	$ 144	272	224
Condensed Consolidated Income (Loss) from Operations	6,261		(3,115)		10,541	(789)
Transition Services Agreement | Related party
Revenue, Major Customer [Line Items]
Fees incurred	$ 192		$ 458		$ 465	$ 1,101

ACQUISITIONS (Details)

ACQUISITIONS (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($) agency	Jun. 30, 2022 USD ($) agency	Dec. 31, 2022 USD ($)
Business Acquisition [Line Items]
Goodwill	$ 83,614		$ 79,497
Series of Individually Immaterial Business Acquisitions
Business Acquisition [Line Items]
Total acquisition	7,261	$ 775
Equipment and other assets	1,027	11
Goodwill	4,117	520
Other indefinite-lived intangible assets		244
Other intangible assets	186
Liabilities assumed	81
Acquisition costs	0	0
Business combination, purchase price		$ 775
Home Health Services | Series of Individually Immaterial Business Acquisitions
Business Acquisition [Line Items]
Other indefinite-lived intangible assets	2,012
Hospice Services | Series of Individually Immaterial Business Acquisitions
Business Acquisition [Line Items]
Other indefinite-lived intangible assets	210
Home Health and Hospice Services
Business Acquisition [Line Items]
Goodwill	$ 79,972		75,855
Home Health and Hospice Services | Series of Individually Immaterial Business Acquisitions
Business Acquisition [Line Items]
Number of businesses acquired and assets acquisitions | agency	2
Home Health and Hospice Services | Home Health Services
Business Acquisition [Line Items]
Number of businesses acquired and assets acquisitions | agency	3	1
Home Health and Hospice Services | Hospice Services
Business Acquisition [Line Items]
Number of businesses acquired and assets acquisitions | agency	1
Home Health and Hospice Services | Hospice Services | Series of Individually Immaterial Business Acquisitions
Business Acquisition [Line Items]
Number of businesses acquired and assets acquisitions | agency	1,000
Home Care Services Segment | Home Care Agencies
Business Acquisition [Line Items]
Number of businesses acquired and assets acquisitions | agency	2
Senior Living Services
Business Acquisition [Line Items]
Number of businesses acquired and assets acquisitions | agency	2
Goodwill	$ 3,642		$ 3,642

PROPERTY AND EQUIPMENT_NET (Det

PROPERTY AND EQUIPMENT—NET (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 50,432		$ 50,432		$ 47,428
Less: accumulated depreciation	(23,180)		(23,180)		(20,807)
Property and equipment, net	27,252		27,252		26,621
Depreciation	1,211	$ 1,264	2,486	$ 2,396
Land
Property, Plant and Equipment [Line Items]
Property and equipment, gross	96		96		96
Building
Property, Plant and Equipment [Line Items]
Property and equipment, gross	1,890		1,890		1,890
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	19,670		19,670		18,759
Equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	27,559		27,559		25,532
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 1,217		$ 1,217		$ 1,151

GOODWILL AND OTHER INDEFINITE_3

GOODWILL AND OTHER INDEFINITE-LIVED INTANGIBLE ASSETS - ACTIVITY IN GOODWILL (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($)
Goodwill [Roll Forward]
Goodwill, beginning balance	$ 79,497
Additions	4,117
Goodwill, ending balance	83,614
Home Health and Hospice Services
Goodwill [Roll Forward]
Goodwill, beginning balance	75,855
Additions	4,117
Goodwill, ending balance	79,972
Senior Living Services
Goodwill [Roll Forward]
Goodwill, beginning balance	3,642
Additions	0
Goodwill, ending balance	$ 3,642

GOODWILL AND OTHER INDEFINITE_4

GOODWILL AND OTHER INDEFINITE-LIVED INTANGIBLE ASSETS - INDEFINITE-LIVED INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Indefinite-lived Intangible Assets [Line Items]
Other indefinite-lived intangibles	$ 61,025	$ 58,617
Trade name
Indefinite-lived Intangible Assets [Line Items]
Other indefinite-lived intangibles	1,571	1,385
Medicare and Medicaid licenses
Indefinite-lived Intangible Assets [Line Items]
Other indefinite-lived intangibles	$ 59,454	$ 57,232

GOODWILL AND OTHER INDEFINITE_5

GOODWILL AND OTHER INDEFINITE-LIVED INTANGIBLE ASSETS - NARRATIVE (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible asset impairments	$ 0	$ 0	$ 0	$ 0

OTHER ACCRUED LIABILITIES (Deta

OTHER ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Other Accrued Liabilities, Current [Abstract]
Refunds payable	$ 2,122	$ 2,244
Deferred revenue	1,819	1,592
Resident deposits	3,040	4,315
Property taxes	975	1,027
Deferred state relief funds	1,469	1,479
Accrued self-insurance liabilities	4,231	3,546
Other	2,524	2,481
Other accrued liabilities	$ 16,180	$ 16,684

DEBT - SCHEDULE OF LONG-TERM DE

DEBT - SCHEDULE OF LONG-TERM DEBT (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Debt Instrument [Line Items]
Less: unamortized debt issuance costs	$ (1,347)		$ (1,347)		$ (1,608)
Long-term debt, net	59,153		59,153		62,892
Amortization of deferred financing fees	130	$ 130	261	$ 260
Revolving Credit Facility | Line of credit
Debt Instrument [Line Items]
Revolving Credit Facility	$ 60,500		$ 60,500		$ 64,500

DEBT - NARRATIVE (Details)

DEBT - NARRATIVE (Details) - USD ($)	Jun. 12, 2023	Jun. 30, 2023	Feb. 23, 2021
Revolving Credit Facility
Debt Instrument [Line Items]
Borrowing capacity			$ 150,000,000
Revolving Credit Facility | Line of credit
Debt Instrument [Line Items]
Weighted average interest rate		7.97%
Borrowing availability		$ 85,314,000
Revolving Credit Facility | Minimum
Debt Instrument [Line Items]
Margin	0.35%
Revolving Credit Facility | Minimum | SOFR
Debt Instrument [Line Items]
Margin	2.25%
Revolving Credit Facility | Minimum | Base Rate
Debt Instrument [Line Items]
Margin	1.25%
Revolving Credit Facility | Maximum
Debt Instrument [Line Items]
Margin	0.50%
Revolving Credit Facility | Maximum | SOFR
Debt Instrument [Line Items]
Margin	3.25%
Revolving Credit Facility | Maximum | Base Rate
Debt Instrument [Line Items]
Margin	2.25%
Letters of credit | Line of credit
Debt Instrument [Line Items]
Letters of credit outstanding		$ 4,186,000

OPTIONS AND AWARDS - SHARE-BASE

OPTIONS AND AWARDS - SHARE-BASED COMPENSATION (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation	$ 1,303	$ 2,380	$ 2,670	$ 4,820
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation	984	779	1,834	1,621
Restricted stock awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation	180	1,502	357	3,021
Restricted stock awards | Non-employee directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation	$ 139	$ 99	$ 479	$ 178

OPTIONS AND AWARDS - UNVESTED S

OPTIONS AND AWARDS - UNVESTED STOCK OPTIONS AND RESTRICTED STOCK (Details) - The Ensign Plans $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unrecognized share-based compensation expense	$ 15,047
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unvested Stock Options	$ 12,296
Weighted Average Recognition Period (in years)	3 years 6 months
Restricted stock awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unvested Restricted Stock	$ 2,751
Weighted Average Recognition Period (in years)	4 years

OPTIONS AND AWARDS - NARRATIVE

OPTIONS AND AWARDS - NARRATIVE (Details) - USD ($) shares in Thousands, $ in Thousands		3 Months Ended			6 Months Ended
	Jul. 25, 2022	Jun. 30, 2023	Sep. 30, 2022	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation		$ 1,303		$ 2,380	$ 2,670	$ 4,820
Restricted stock awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation		180		1,502	357	3,021
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation		$ 984		$ 779	$ 1,834	$ 1,621
The Ensign Plans
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Forfeited (in shares)					37
Share-based compensation			$ 3,812
The Ensign Plans | Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Forfeited (in shares)	250
Vested (in shares)	943
The Ensign Plans | Restricted stock awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period					5 years
The Ensign Plans | Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options, vesting percent per year					20%
Options, expiration period					10 years

OPTIONS AND AWARDS - OPTIONS GR

OPTIONS AND AWARDS - OPTIONS GRANTED (Details) - The Ensign Plans - $ / shares shares in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted (in shares)	656
2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted (in shares)	656
Weighted average fair value of options (in dollars per share)	$ 6.78
2023 | Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk-Free Interest Rate	4%
Expected life	6 years 6 months
Expected volatility	41.60%
Dividend Yield	0%
2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted (in shares)		298
Weighted average fair value of options (in dollars per share)		$ 6.60
2022 | Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk-Free Interest Rate		2.20%
Expected life		6 years 6 months
Expected volatility		39.90%
Dividend Yield		0%

OPTIONS AND AWARDS - EMPLOYEE S

OPTIONS AND AWARDS - EMPLOYEE STOCK OPTION ACTIVITY (Details) - The Ensign Plans shares in Thousands	6 Months Ended
	Jun. 30, 2023 $ / shares shares	Dec. 31, 2022 $ / shares shares
Number of Options Outstanding
Beginning balance, outstanding (in shares) | shares	2,219
Granted (in shares) | shares	656
Exercised (in shares) | shares	(63)
Forfeited (in shares) | shares	(37)
Expired (in shares) | shares	(34)
Ending balance, outstanding (in shares) | shares	2,741
Weighted Average Exercise Price
Beginning of period, weighted average exercise price (in dollars per share) | $ / shares	$ 20.76
Granted (in dollars per share) | $ / shares	14.03
Exercised (in dollars per share) | $ / shares	7.18
Forfeited (in dollars per share) | $ / shares	22.22
Expired (in dollars per share) | $ / shares	20.13
End of period, weighted average exercise price (in dollars per share) | $ / shares	$ 19.29
Number of options vested (in shares) | shares	1,054	973
Weighted average exercise price of options vested (in dollars per share) | $ / shares	$ 18.17	$ 16.90

OPTIONS AND AWARDS - RESTRICTED

OPTIONS AND AWARDS - RESTRICTED STOCK (Details) - The Ensign Plans - Restricted stock awards shares in Thousands	6 Months Ended
	Jun. 30, 2023 $ / shares shares
Non-Vested Restricted Stock
Beginning balance, outstanding (in shares) | shares	418
Granted (in shares) | shares	42
Vested (in shares) | shares	(78)
Forfeited (in shares) | shares	(3)
Ending balance, outstanding (in shares) | shares	379
Weighted Average Grant Date Fair Value
Beginning of period, weighted average exercise price (in dollars per share) | $ / shares	$ 14.26
Granted (in dollars per share) | $ / shares	11.42
Vested (in dollars per share) | $ / shares	12.53
Forfeited (in dollars per share) | $ / shares	15.30
End of period, weighted average exercise price (in dollars per share) | $ / shares	$ 14.29

LEASES - NARRATIVE (Details)

LEASES - NARRATIVE (Details) $ in Thousands

3 Months Ended

6 Months Ended

Jun. 30, 2023 USD ($)

Jun. 30, 2022 USD ($) property

Jun. 30, 2023 USD ($)

Jun. 30, 2022 USD ($) property

Jun. 30, 2023 USD ($)

Jun. 30, 2023 facility

Jun. 30, 2023 agency

Jun. 30, 2023 property

Jun. 30, 2023 arrangement

Jun. 30, 2023

Apr. 01, 2022 lease

Jan. 27, 2022 facility

Lessee, Lease, Description [Line Items]

Non-cash adjustment to right-of-use assets and lease liabilities from lease modifications

$ 6,522

$ 6,522

$ 0

Weighted average remaining lease term

12 years 3 months 18 days

12 years 3 months 18 days

Weighted average discount rate

7.60%

Related party

Lessee, Lease, Description [Line Items]

Non-cash adjustment to right-of-use assets and lease liabilities from lease terminations and assignments

$ 42,515

Non-cash adjustment to right-of-use assets and lease liabilities from lease modifications

6,522

6,522

Related party | Operating lease, rent expense

Lessee, Lease, Description [Line Items]

Fees incurred

$ 3,333

$ 3,006

$ 6,749

$ 6,490

Senior Living Services

Lessee, Lease, Description [Line Items]

Number of properties under lease

51

51

Senior Living Services | Related party

Lessee, Lease, Description [Line Items]

Number of properties under lease | facility

5

Number of operating facilities | property

29

29

29

Number of properties under lease, master lease agreement | facility

14

Number of separate master lease arrangements | arrangement

3

Number of terminated leases under master lease agreement | lease

4

Senior Living Services | Minimum

Lessee, Lease, Description [Line Items]

Lease term

15 years

15 years

Senior Living Services | Minimum | Related party

Lessee, Lease, Description [Line Items]

Lease term

14 years

14 years

Senior Living Services | Maximum

Lessee, Lease, Description [Line Items]

Lease term

25 years

25 years

Senior Living Services | Maximum | Related party

Lessee, Lease, Description [Line Items]

Lease term

20 years

20 years

LEASES - IMPACT OF NEW LEASES G

LEASES - IMPACT OF NEW LEASES GUIDANCE (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Lease, Cost
Variable lease cost	$ 1,761	$ 1,298	$ 3,491	$ 2,873
Cost of services
Lease, Cost
Operating lease costs	9,836	9,078	19,433	19,129
Cost of services | Community
Lease, Cost
Operating lease costs	8,462	7,837	16,736	16,626
Cost of services | Office
Lease, Cost
Operating lease costs	1,374	1,241	2,697	2,503
General and administrative expense
Lease, Cost
Operating lease costs	$ 104	$ 74	$ 197	$ 155

LEASES - FUTURE MINIMUM LEASE P

LEASES - FUTURE MINIMUM LEASE PAYMENTS (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Leases, Under Adoption of ASC 842 [Abstract]
2023 (Remainder)	$ 18,300
2024	35,913
2025	34,543
2026	33,441
2027	32,778
Thereafter	253,655
Total lease payments	408,630
Less: present value adjustments	(144,911)
Present value of total lease liabilities	263,719
Less: current lease liabilities	(17,412)	$ (16,633)
Long-term operating lease liabilities	$ 246,307	$ 247,042

INCOME TAXES (Details)

INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Income Tax Disclosure [Abstract]
Income tax expense (benefit)	$ 1,921	$ (1,375)	$ 2,828	$ (833)
Effective income tax rate reconciliation, percent	39.70%	34.60%	36.50%	36.70%

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands	1 Months Ended	6 Months Ended	12 Months Ended
	May 31, 2022 USD ($) agency	Jun. 30, 2023 USD ($) review	Dec. 31, 2022 USD ($)
Concentration Risk [Line Items]
Number of operating subsidiaries with reviews scheduled | review		10
Suspended payments		$ 5,105
Number of patient records under review | agency	107
Period of review	10 months
Sampled and extrapolated overpayments	$ 5,105
General and professional liability, retention limit		150
Out-of-pocket retention		500
Workers' compensation, retention limit		250
Maximum
Concentration Risk [Line Items]
Self insurance, individual coverage limit		$ 350	$ 350

COMMON STOCK REPURCHASE PROGR_2

COMMON STOCK REPURCHASE PROGRAM (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023	Dec. 12, 2022
Equity [Abstract]
Repurchase of common stock amount			$ 1,000
Stock repurchased (in shares)	0	0