Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 20, 2018 | Jun. 30, 2017 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | ENCOMPASS HEALTH CORP | ||
Entity Central Index Key | 785,161 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 98,139,126 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 4.7 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | |||
Net operating revenues | $ 3,971.4 | $ 3,707.2 | $ 3,162.9 |
Less: Provision for doubtful accounts | (52.4) | (61.2) | (47.2) |
Net operating revenues less provision for doubtful accounts | 3,919 | 3,646 | 3,115.7 |
Operating expenses: | |||
Salaries and benefits | 2,154.6 | 1,985.9 | 1,670.8 |
Other operating expenses | 536.7 | 492.1 | 432.1 |
Occupancy costs | 73.5 | 71.3 | 53.9 |
Supplies | 149.3 | 140 | 128.7 |
General and administrative expenses | 171.7 | 133.4 | 133.3 |
Depreciation and amortization | 183.8 | 172.6 | 139.7 |
Government, class action, and related settlements | 0 | 0 | 7.5 |
Professional fees—accounting, tax, and legal | 0 | 1.9 | 3 |
Total operating expenses | 3,269.6 | 2,997.2 | 2,569 |
Loss on early extinguishment of debt | 10.7 | 7.4 | 22.4 |
Interest expense and amortization of debt discounts and fees | 154.4 | 172.1 | 142.9 |
Other income | (4.1) | (2.9) | (5.5) |
Equity in net income of nonconsolidated affiliates | (8) | (9.8) | (8.7) |
Income from continuing operations before income tax expense | 496.4 | 482 | 395.6 |
Provision for income tax expense | 160.6 | 163.9 | 141.9 |
Income from continuing operations | 335.8 | 318.1 | 253.7 |
Loss from discontinued operations, net of tax | (0.4) | 0 | (0.9) |
Net income | 335.4 | 318.1 | 252.8 |
Less: Net income attributable to noncontrolling interests | (79.1) | (70.5) | (69.7) |
Net income attributable to Encompass Health | 256.3 | 247.6 | 183.1 |
Less: Convertible perpetual preferred stock dividends | 0 | 0 | (1.6) |
Net income attributable to Encompass Health common shareholders | $ 256.3 | $ 247.6 | $ 181.5 |
Weighted average common shares outstanding: | |||
Basic (shares) | 93.7 | 89.1 | 89.4 |
Diluted (shares) | 99.3 | 99.5 | 101 |
Basic earnings per share attributable to Encompass Health common shareholders: | |||
Continuing operations (in dollars per share) | $ 2.73 | $ 2.77 | $ 2.03 |
Discontinued Operations (in dollars per share) | 0 | 0 | (0.01) |
Net income (in dollars per share) | 2.73 | 2.77 | 2.02 |
Diluted earnings per share attributable to Encompass Health common shareholders: | |||
Continuing operations (in dollars per share) | 2.69 | 2.59 | 1.92 |
Discontinued operations (in dollars per share) | 0 | 0 | (0.01) |
Net income (in dollars per share) | 2.69 | 2.59 | 1.91 |
Cash dividends per common share (in dollars per share) | $ 0.98 | $ 0.94 | $ 0.88 |
Amounts attributable to Encompass Health common shareholders: | |||
Income from continuing operations | $ 256.7 | $ 247.6 | $ 184 |
Loss from discontinued operations, net of tax | (0.4) | 0 | (0.9) |
Net income attributable to Encompass Health | $ 256.3 | $ 247.6 | $ 183.1 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |||
Net income | $ 335.4 | $ 318.1 | $ 252.8 |
Net change in unrealized (loss) gain on available-for-sale securities: | |||
Unrealized net holding (loss) gain arising during the period | (0.1) | 0.1 | (0.1) |
Reclassifications to net income | 0 | 0 | (1.2) |
Other comprehensive (loss) income before income taxes | (0.1) | 0.1 | (1.3) |
Provision for income tax (expense) benefit related to other comprehensive loss items | 0 | (0.1) | 0.6 |
Other comprehensive loss, net of tax: | (0.1) | 0 | (0.7) |
Comprehensive income | 335.3 | 318.1 | 252.1 |
Comprehensive income attributable to noncontrolling interests | (79.1) | (70.5) | (69.7) |
Comprehensive income attributable to Encompass Health | $ 256.2 | $ 247.6 | $ 182.4 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | |
Current assets: | |||
Cash and cash equivalents | $ 54.4 | $ 40.5 | |
Restricted cash | 62.4 | 60.9 | |
Accounts receivable, net of allowance for doubtful accounts of $60.9 in 2017; $53.9 in 2016 | 472.1 | 443.8 | |
Prepaid expenses and other current assets | 113.3 | 109.3 | |
Total current assets | 702.2 | 654.5 | |
Property and equipment, net | 1,517.1 | 1,391.8 | |
Goodwill | 1,972.6 | 1,927.2 | |
Intangible assets, net | 403.1 | 411.3 | |
Deferred income tax assets | 63.6 | 75.8 | |
Other long-term assets | 235.1 | 221.3 | |
Total assets | [1] | 4,893.7 | 4,681.9 |
Current liabilities: | |||
Current portion of long-term debt | 32.3 | 37.1 | |
Accounts payable | 78.4 | 68.3 | |
Accrued payroll | 172.1 | 147.3 | |
Accrued interest payable | 24.7 | 25.8 | |
Other current liabilities | 210 | 197.1 | |
Total current liabilities | 517.5 | 475.6 | |
Long-term debt, net of current portion | 2,545.4 | 2,979.3 | |
Self-insured risks | 110.1 | 110.4 | |
Other long-term liabilities | 75.2 | 49.6 | |
Total liabilities | 3,248.2 | 3,614.9 | |
Commitments and contingencies | |||
Redeemable noncontrolling interests | 220.9 | 138.3 | |
Encompass Health shareholders’ equity: | |||
Common stock, $.01 par value; 200,000,000 shares authorized; issued: 111,690,547 in 2017; 109,381,283 in 2016 | 1.1 | 1.1 | |
Capital in excess of par value | 2,791.4 | 2,799.1 | |
Accumulated deficit | (1,191) | (1,448.4) | |
Accumulated other comprehensive loss | (1.3) | (1.2) | |
Treasury stock, at cost (13,385,019 shares in 2017 and 20,451,458 shares in 2016) | (418.5) | (614.7) | |
Total Encompass Health shareholders’ equity | 1,181.7 | 735.9 | |
Noncontrolling interests | 242.9 | 192.8 | |
Total shareholders’ equity | 1,424.6 | 928.7 | |
Total liabilities and shareholders’ equity | $ 4,893.7 | $ 4,681.9 | |
[1] | Our consolidated assets as of December 31, 2017 and December 31, 2016 include total assets of variable interest entities of $264.1 million and $262.3 million, respectively, which cannot be used by us to settle the obligations of other entities. Our consolidated liabilities as of December 31, 2017 and December 31, 2016 include total liabilities of the variable interest entities of $52.5 million and $50.3 million, respectively. See Note 3, Variable Interest Entities. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | |
Total assets | [1] | $ 4,893.7 | $ 4,681.9 |
Total liabilities | 3,248.2 | 3,614.9 | |
Assets | |||
Allowance for doubtful accounts | $ 60.9 | $ 53.9 | |
Encompass Health shareholders' equity: | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 | |
Common stock, shares issued (in shares) | 111,690,547 | 109,381,283 | |
Treasury stock, shares (in shares) | 13,385,019 | 20,451,458 | |
Variable Interest Entity, Primary Beneficiary, Aggregated Disclosure [Member] | |||
Total assets | $ 264.1 | $ 262.3 | |
Total liabilities | $ 52.5 | $ 50.3 | |
[1] | Our consolidated assets as of December 31, 2017 and December 31, 2016 include total assets of variable interest entities of $264.1 million and $262.3 million, respectively, which cannot be used by us to settle the obligations of other entities. Our consolidated liabilities as of December 31, 2017 and December 31, 2016 include total liabilities of the variable interest entities of $52.5 million and $50.3 million, respectively. See Note 3, Variable Interest Entities. |
Consolidated Statement of Share
Consolidated Statement of Shareholders' Equity - USD ($) shares in Thousands, $ in Millions | Total | Common Stock [Member] | Capital in Excess of Par Value [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] | Treasury Stock [Member] | Noncontrolling Interests [Member] |
Balance at beginning of period (shares) at Dec. 31, 2014 | 87,800 | ||||||
Balance at beginning of period at Dec. 31, 2014 | $ 619.5 | $ 1 | $ 2,810.5 | $ (1,879.1) | $ (0.5) | $ (458.7) | $ 146.3 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 239 | 183.1 | 55.9 | ||||
Conversion of convertible debt, net of tax (shares) | 3,300 | ||||||
Conversion of preferred stock | 93.2 | 93.2 | |||||
Receipt of treasury stock (shares) | (500) | ||||||
Receipt of treasury stock | (17.2) | (17.2) | |||||
Dividends declared on common stock | (79.9) | (79.9) | |||||
Dividends declared on convertible perpetual preferred stock | (1.6) | (1.6) | |||||
Stock-based compensation | 22.4 | 22.4 | |||||
Stock options exercised (shares) | 200 | ||||||
Stock options exercised | 2.3 | 6.7 | (4.4) | ||||
Distributions declared | (49) | (49) | |||||
Repurchases of common stock in open market (shares) | (1,300) | ||||||
Repurchases of common stock in open market | (45.3) | (45.3) | |||||
Capital contributions from consolidated affiliates | 14.8 | 14.8 | |||||
Fair value adjustments to redeemable noncontrolling interests, net of tax | (18.2) | (18.2) | |||||
Other (shares) | 600 | ||||||
Other | (0.7) | $ 0.1 | 1.8 | (0.7) | (1.8) | (0.1) | |
Balance at end of period (shares) at Dec. 31, 2015 | 90,100 | ||||||
Balance at end of period at Dec. 31, 2015 | 779.3 | $ 1.1 | 2,834.9 | (1,696) | (1.2) | (527.4) | 167.9 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 304 | 247.6 | 56.4 | ||||
Receipt of treasury stock (shares) | (500) | ||||||
Receipt of treasury stock | (11.6) | (11.6) | |||||
Dividends declared on common stock | (84.9) | (84.9) | |||||
Stock-based compensation | 21.4 | 21.4 | |||||
Stock options exercised (shares) | 600 | ||||||
Stock options exercised | 5.3 | 13.1 | (7.8) | ||||
Distributions declared | (54.2) | (54.2) | |||||
Repurchases of common stock in open market (shares) | (1,700) | ||||||
Repurchases of common stock in open market | (65.6) | (65.6) | |||||
Capital contributions from consolidated affiliates | 19.6 | 19.6 | |||||
Fair value adjustments to redeemable noncontrolling interests, net of tax | (6.7) | (6.7) | |||||
Windfall tax benefits from share-based compensation | 17.3 | 17.3 | |||||
Other (shares) | 400 | ||||||
Other | 4.8 | $ 0 | 4 | 0 | (2.3) | 3.1 | |
Balance at end of period (shares) at Dec. 31, 2016 | 88,900 | ||||||
Balance at end of period at Dec. 31, 2016 | 928.7 | $ 1.1 | 2,799.1 | (1,448.4) | (1.2) | (614.7) | 192.8 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 317.5 | 256.3 | 61.2 | ||||
Conversion of convertible debt, net of tax (shares) | 8,900 | ||||||
Stock Issued During Period, Value, Conversion of Convertible Securities, Net of Adjustments | 53.7 | ||||||
Conversion of preferred stock | 328.2 | 274.5 | |||||
Receipt of treasury stock (shares) | (900) | ||||||
Receipt of treasury stock | (19.8) | (19.8) | |||||
Dividends declared on common stock | (95.2) | (95.2) | |||||
Stock-based compensation | $ 21.3 | 21.3 | |||||
Stock options exercised (shares) | 1,107 | 1,100 | |||||
Stock options exercised | $ 1.1 | 20.4 | (19.3) | ||||
Stock warrants exercised (shares) | 700 | ||||||
Stock warrants exercised | 26.6 | 26.6 | |||||
Distributions declared | (50.5) | (50.5) | |||||
Repurchases of common stock in open market (shares) | (900) | ||||||
Repurchases of common stock in open market | (38.1) | (38.1) | |||||
Capital contributions from consolidated affiliates | 46.2 | 46.2 | |||||
Fair value adjustments to redeemable noncontrolling interests, net of tax | (41) | (41) | |||||
Other (shares) | 500 | ||||||
Other | (0.4) | 6.5 | 1.1 | (0.1) | (1.1) | (6.8) | |
Balance at end of period (shares) at Dec. 31, 2017 | 98,300 | ||||||
Balance at end of period at Dec. 31, 2017 | $ 1,424.6 | $ 1.1 | $ 2,791.4 | $ (1,191) | $ (1.3) | $ (418.5) | $ 242.9 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | |||
Net income | $ 335.4 | $ 318.1 | $ 252.8 |
Loss from discontinued operations, net of tax | 0.4 | 0 | 0.9 |
Adjustments to reconcile net income to net cash provided by operating activities— | |||
Provision for doubtful accounts | 52.4 | 61.2 | 47.2 |
Provision for government, class action, and related settlements | 0 | 0 | 7.5 |
Depreciation and amortization | 183.8 | 172.6 | 139.7 |
Amortization of debt-related items | 8.7 | 13.8 | 14.3 |
Loss on early extinguishment of debt | 10.7 | 7.4 | 22.4 |
Equity in net income of nonconsolidated affiliates | (8) | (9.8) | (8.7) |
Distributions from nonconsolidated affiliates | 8.6 | 8.5 | 7.7 |
Stock-based compensation | 47.7 | 27.4 | 26.2 |
Deferred tax expense | 75.6 | 132.9 | 127.1 |
Other, net | 3.4 | 0.1 | (0.6) |
Changes in assets and liabilities, net of acquisitions— | |||
Accounts receivable | (83.9) | (127.5) | (134.1) |
Prepaid expenses and other assets | (12.6) | (3.3) | (9.6) |
Accounts payable | 7.5 | 6.3 | 0.9 |
Accrued payroll | 24.4 | 21.4 | (0.9) |
Other liabilities | 3.7 | 11.8 | 13.8 |
Premium received on bond issuance | 0 | 0 | 9.8 |
Premium paid on redemption of bonds | 0 | (5.8) | (13.7) |
Net cash used in operating activities of discontinued operations | (0.6) | (0.7) | (0.7) |
Total adjustments | 321.4 | 316.3 | 248.3 |
Net cash provided by operating activities | 657.2 | 634.4 | 502 |
Cash flows from investing activities: | |||
Acquisition of businesses, net of cash acquired | (38.8) | (48.1) | (985.1) |
Purchases of property and equipment | (225.8) | (177.7) | (128.4) |
Additions to capitalized software costs | (19.2) | (25.2) | (28.1) |
Proceeds from disposal of assets | 12.3 | 23.9 | 4 |
Proceeds from sale of nonrestricted marketable securities | 0 | 0 | 12.8 |
Purchases of restricted investments | (8.5) | (1.3) | (7.1) |
Net change in restricted cash | (1.5) | (15.1) | 2.7 |
Other, net | (3) | (1.6) | (1.1) |
Net cash provided by investing activities of discontinued operations | 0 | 0.1 | 0.5 |
Net cash used in investing activities | (284.5) | (245) | (1,129.8) |
Cash flows from financing activities: | |||
Principal borrowings on term loan facilities | 0 | 0 | 250 |
Proceeds from bond issuance | 0 | 0 | 1,400 |
Principal payments on debt, including pre-payments | (129.9) | (202.1) | (597.4) |
Borrowings on revolving credit facility | 273.3 | 335 | 540 |
Payments on revolving credit facility | (330.3) | (313) | (735) |
Principal payments under capital lease obligations | (15.3) | (13.3) | (11) |
Debt amendment and issuance costs | (3.1) | 0 | (31.9) |
Repurchases of common stock, including fees and expenses | (38.1) | (65.6) | (45.3) |
Dividends paid on common stock | (91.5) | (83.8) | (77.2) |
Proceeds from exercising stock warrants | 26.6 | 0 | 0 |
Distributions paid to noncontrolling interests of consolidated affiliates | (51.9) | (64.9) | (54.4) |
Taxes paid on behalf of employees for shares withheld | (19.8) | (11.6) | (17.2) |
Contributions from consolidated affiliates | 20.8 | 3.5 | 3 |
Other, net | 0.4 | 5.3 | (0.9) |
Net cash (used in) provided by financing activities | (358.8) | (410.5) | 622.7 |
Increase (decrease) in cash and cash equivalents | 13.9 | (21.1) | (5.1) |
Cash and cash equivalents at beginning of year | 40.5 | 61.6 | 66.7 |
Cash and cash equivalents at end of year | 54.4 | 40.5 | 61.6 |
Supplemental cash flow information: | |||
Interest | (150.5) | (164.3) | (121.4) |
Income tax refunds | 1.9 | 1.4 | 7.4 |
Income tax payments | (96.4) | (33.3) | (16.8) |
Supplemental schedule of noncash financing activities: | |||
Conversion of convertible debt | 319.4 | 0 | 0 |
Preferred stock conversion | $ 0 | $ 0 | $ 93.2 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies : Organization and Description of Business— Encompass Health Corporation, incorporated in Delaware in 1984, including its subsidiaries, is one of the nation’s largest providers of post-acute healthcare services, offering both facility-based and home-based post-acute services in 36 states and Puerto Rico through our network of inpatient rehabilitation hospitals, home health agencies, and hospice agencies. We manage our operations and disclose financial information using two reportable segments: (1) inpatient rehabilitation and (2) home health and hospice. See Note 18 , Segment Reporting . On July 10, 2017, we announced the plan to rebrand and change our name from HealthSouth Corporation to Encompass Health Corporation. On October 20, 2017, our board of directors approved an amended and restated certificate of incorporation in order to change the name effective as of January 1, 2018. Along with the corporate name change, the NYSE ticker symbol for our common stock changed from “HLS” to “EHC.” Our operations in both business segments will transition to the Encompass Health branding on a rolling basis. Basis of Presentation and Consolidation— The accompanying consolidated financial statements of Encompass Health and its subsidiaries were prepared in accordance with generally accepted accounting principles in the United States of America and include the assets, liabilities, revenues, and expenses of all wholly-owned subsidiaries, majority-owned subsidiaries over which we exercise control, and, when applicable, entities in which we have a controlling financial interest. We use the equity method to account for our investments in entities we do not control, but where we have the ability to exercise significant influence over operating and financial policies. Consolidated Net income attributable to Encompass Health includes our share of the net earnings of these entities. The difference between consolidation and the equity method impacts certain of our financial ratios because of the presentation of the detailed line items reported in the consolidated financial statements for consolidated entities compared to a one line presentation of equity method investments. We use the cost method to account for our investments in entities we do not control and for which we do not have the ability to exercise significant influence over operating and financial policies. In accordance with the cost method, these investments are recorded at the lower of cost or fair value, as appropriate. We eliminate all significant intercompany accounts and transactions from our financial results. Variable Interest Entities — Any entity considered a variable interest entity (“VIE”) is evaluated to determine which party is the primary beneficiary and thus should consolidate the VIE. This analysis is complex, involves uncertainties, and requires significant judgment on various matters. In order to determine if we are the primary beneficiary of a VIE, we must determine what activities most significantly impact the economic performance of the entity, whether we have the power to direct those activities, and if our obligation to absorb losses or receive benefits from the VIE could potentially be significant to the VIE. Use of Estimates and Assumptions— The preparation of our consolidated financial statements in conformity with GAAP requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions are used for, but not limited to: (1) allowance for contractual revenue adjustments; (2) allowance for doubtful accounts; (3) fair value of acquired assets and assumed liabilities in business combinations; (4) asset impairments, including goodwill; (5) depreciable lives of assets; (6) useful lives of intangible assets; (7) economic lives and fair value of leased assets; (8) income tax valuation allowances; (9) uncertain tax positions; (10) fair value of stock options and restricted stock containing a market condition; (11) fair value of redeemable noncontrolling interests; (12) reserves for self-insured healthcare plans; (13) reserves for professional, workers’ compensation, and comprehensive general insurance liability risks; and (14) contingency and litigation reserves. Future events and their effects cannot be predicted with certainty; accordingly, our accounting estimates require the exercise of judgment. The accounting estimates used in the preparation of our consolidated financial statements will change as new events occur, as more experience is acquired, as additional information is obtained, and as our operating environment changes. We evaluate and update our assumptions and estimates on an ongoing basis and may employ outside experts to assist in our evaluation, as considered necessary. Actual results could differ from those estimates. Risks and Uncertainties— As a healthcare provider, we are required to comply with extensive and complex laws and regulations at the federal, state, and local government levels. These laws and regulations relate to, among other things: • licensure, certification, and accreditation; • policies, either at the national or local level, delineating what conditions must be met to qualify for reimbursement under Medicare (also referred to as coverage requirements); • coding and billing for services; • requirements of the 60% compliance threshold under The Medicare, Medicaid and State Children’s Health Insurance Program (SCHIP) Extension Act of 2007; • relationships with physicians and other referral sources, including physician self-referral and anti-kickback laws; • quality of medical care; • use and maintenance of medical supplies and equipment; • maintenance and security of patient information and medical records; • acquisition and dispensing of pharmaceuticals and controlled substances; and • disposal of medical and hazardous waste. In the future, changes in these laws or regulations or the manner in which they are enforced could subject our current or past practices to allegations of impropriety or illegality or could require us to make changes in our hospitals, equipment, personnel, services, capital expenditure programs, operating procedures, contractual arrangements, and patient admittance practices, as well as the way in which we deliver home health and hospice services. If we fail to comply with applicable laws and regulations, we could be required to return portions of reimbursements deemed after the fact to have not been appropriate. We could also be subjected to liabilities, including (1) criminal penalties, (2) civil penalties, including monetary penalties and the loss of our licenses to operate one or more of our hospitals or agencies, and (3) exclusion or suspension of one or more of our hospitals from participation in the Medicare, Medicaid, and other federal and state healthcare programs which, if lengthy in duration and material to us, could potentially trigger a default under our credit agreement. Because Medicare comprises a significant portion of our Net operating revenues , it is important for us to remain compliant with the laws and regulations governing the Medicare program and related matters including anti-kickback and anti-fraud requirements. Reductions in reimbursements, substantial damages, and other remedies assessed against us could have a material adverse effect on our business, financial position, results of operation, and cash flows. Even the assertion of a violation, depending on its nature, could have a material adverse effect upon our stock price or reputation. Historically, the United States Congress and some state legislatures have periodically proposed significant changes in regulations governing the healthcare system. Many of these changes have resulted in limitations on the increases in and, in some cases, significant roll-backs or reductions in the levels of payments to healthcare providers for services under many government reimbursement programs. There can be no assurance that future governmental initiatives will not result in pricing roll-backs or freezes or reimbursement reductions. Because we receive a significant percentage of our revenues from Medicare, such changes in legislation might have a material adverse effect on our financial position, results of operations, and cash flows. In addition, there are increasing pressures from many third-party payors to control healthcare costs and to reduce or limit increases in reimbursement rates for medical services. Our relationships with managed care and nongovernmental third-party payors are generally governed by negotiated agreements. These agreements set forth the amounts we are entitled to receive for our services. We could be adversely affected in some of the markets where we operate if we are unable to negotiate and maintain favorable agreements with third-party payors. Our third-party payors may also, from time to time, request audits of the amounts paid, or to be paid, to us. We could be adversely affected in some of the markets where we operate if the auditing payor alleges substantial overpayments were made to us due to coding errors or lack of documentation to support medical necessity determinations. As discussed in Note 17, Contingencies and Other Commitments , we are a party to a number of lawsuits. We cannot predict the outcome of litigation filed against us. Substantial damages or other monetary remedies assessed against us could have a material adverse effect on our business, financial position, results of operations, and cash flows. Net Operating Revenues— We derived consolidated Net operating revenues from the following payor sources: For the Year Ended December 31, 2017 2016 2015 Medicare 75.5 % 75.2 % 74.9 % Medicare Advantage 8.7 % 7.9 % 7.9 % Managed care 9.5 % 9.8 % 9.8 % Medicaid 2.7 % 3.2 % 3.0 % Other third-party payors 1.3 % 1.4 % 1.7 % Workers' compensation 0.7 % 0.8 % 0.9 % Patients 0.5 % 0.5 % 0.6 % Other income 1.1 % 1.2 % 1.2 % Total 100.0 % 100.0 % 100.0 % We record gross service charges in our accounting records on an accrual basis using our established rates for the type of service provided to the patient. We recognize an estimated contractual allowance and an estimate of potential subsequent adjustments that may arise from post-payment and other reviews to reduce gross patient charges to the amount we estimate we will actually realize for the service rendered based upon previously agreed to rates with a payor. Our accounting systems calculate contractual allowances on a patient-by-patient basis based on the rates in effect for each primary third-party payor. Management continually reviews the contractual estimation process to consider and incorporate updates to laws and regulations and the frequent changes in managed care contractual terms that result from contract renegotiations and renewals. Due to complexities involved in determining amounts ultimately due under reimbursement arrangements with third-party payors, which are often subject to interpretation, we may receive reimbursement for healthcare services authorized and provided that is different from our estimates, and such differences could be material. In addition, laws and regulations governing the Medicare and Medicaid programs are complex, subject to interpretation, and are routinely modified for provider reimbursement. All healthcare providers participating in the Medicare and Medicaid programs are required to meet certain financial reporting requirements. Federal regulations require submission of annual cost reports covering medical costs and expenses associated with the services provided under each hospital, home health, and hospice provider number to program beneficiaries. Annual cost reports required under the Medicare and Medicaid programs are subject to routine audits, which may result in adjustments to the amounts ultimately determined to be due to Encompass Health under these reimbursement programs. These audits often require several years to reach the final determination of amounts earned under the programs. If actual results are not consistent with our assumptions and judgments, we may be exposed to gains or losses that could be material. CMS has been granted authority to suspend payments, in whole or in part, to Medicare providers if CMS possesses reliable information an overpayment, fraud, or willful misrepresentation exists. If CMS suspects payments are being made as the result of fraud or misrepresentation, CMS may suspend payment at any time without providing prior notice to us. The initial suspension period is limited to 180 days. However, the payment suspension period can be extended almost indefinitely if the matter is under investigation by the United States Department of Health and Human Services Office of Inspector General (the “HHS-OIG”) or the United States Department of Justice. Therefore, we are unable to predict if or when we may be subject to a suspension of payments by the Medicare and/or Medicaid programs, the possible length of the suspension period, or the potential cash flow impact of a payment suspension. Any such suspension would adversely impact our financial position, results of operations, and cash flows. Pursuant to legislative directives and authorizations from Congress, CMS has developed and instituted various Medicare audit programs under which CMS contracts with private companies to conduct claims and medical record audits. As a matter of course, we undertake significant efforts through training and education to ensure compliance with Medicare requirements. However, audits may lead to assertions we have been underpaid or overpaid by Medicare or submitted improper claims in some instances, require us to incur additional costs to respond to requests for records and defend the validity of payments and claims, and ultimately require us to refund any amounts determined to have been overpaid. We cannot predict when or how these audit programs will affect us. Inpatient Rehabilitation Revenues Our inpatient rehabilitation segment derived its Net operating revenues from the following payor sources: For the Year Ended December 31, 2017 2016 2015 Medicare 73.2 % 73.3 % 73.2 % Medicare Advantage 8.4 % 7.7 % 7.9 % Managed care 10.9 % 11.2 % 11.1 % Medicaid 3.1 % 3.0 % 2.5 % Other third-party payors 1.6 % 1.8 % 2.0 % Workers’ compensation 0.9 % 1.0 % 1.1 % Patients 0.6 % 0.6 % 0.7 % Other income 1.3 % 1.4 % 1.5 % Total 100.0 % 100.0 % 100.0 % Revenues recognized by our inpatient rehabilitation segment are subject to a number of elements which impact both the overall amount of revenue realized as well as the timing of the collection of the related accounts receivable. Factors that are considered and could influence the level of our reserves include the patient’s total length of stay for in-house patients, each patient’s discharge destination, the proportion of patients with secondary insurance coverage and the level of reimbursement under that secondary coverage, and the amount of charges that will be disallowed by payors. Such additional factors are assumed to remain consistent with the experience for patients discharged in similar time periods for the same payor classes, and additional reserves are provided to account for these factors. In connection with CMS approved and announced Recovery Audit Contractors (“RACs”) audits related to inpatient rehabilitation facilities (“IRFs”), we received requests from 2013 to 2017 to review certain patient files for discharges occurring from 2010 to 2017 . These RAC audits are focused on identifying Medicare claims that may contain improper payments. RAC contractors must have CMS approval before conducting these focused reviews ranging from billing documentation to medical necessity. Medical necessity is an assessment by an independent physician of a patient’s ability to tolerate and benefit from intensive multi-disciplinary therapy provided in an IRF setting. To date, the Medicare payments that are subject to these audit requests represent less than 1% of our Medicare patient discharges from 2010 to 2017 , and not all of these patient file requests have resulted in payment denial determinations by the RACs. Because we have confidence in the medical judgment of both the referring and the admitting physicians who assess the treatment needs of their patients, we have appealed substantially all RAC denials arising from these audits using the same process we follow for appealing denials of certain diagnosis codes by Medicare Administrative Contractors (“MACs”) (see “Accounts Receivable and Allowance for Doubtful Accounts” below). Due to the delays announced by CMS in the related adjudication process, we believe the resolution of any claims that are subsequently denied as a result of these RAC audits could take in excess of three years. In addition, because we have limited experience with RACs in the context of claims reviews of this nature, we cannot provide assurance as to the future success of these disputes. As such, we make provisions for these claims based on our historical experience and success rates in the claims adjudication process, which is the same process we follow for appealing denials of certain diagnosis codes by MACs. As the ultimate results of these audits impact our estimates of amounts determined to be due to Encompass Health under these reimbursement programs, our provision for claims that are part of this claims review process are recorded to Net operating revenues . During 2017 , 2016 , and 2015 , our adjustment to Net operating revenues for claims that are part of this review process was not material. Home Health and Hospice Revenues Our home health and hospice segment derived its Net operating revenues from the following payor sources: For the Year Ended December 31, 2017 2016 2015 Medicare 85.1 % 82.9 % 83.7 % Medicare Advantage 9.7 % 8.7 % 7.7 % Managed care 3.8 % 3.9 % 3.0 % Medicaid 1.2 % 4.3 % 5.5 % Other third-party payors — % — % — % Workers’ compensation — % — % — % Patients 0.1 % 0.1 % 0.1 % Other income 0.1 % 0.1 % — % Total 100.0 % 100.0 % 100.0 % Home health and hospice revenues are earned as services are performed either on an episode of care basis, on a per visit basis, or on a daily basis, depending upon the payment terms and conditions established with each payor for services provided. Home Health Under the Medicare home health prospective payment system, we are paid by Medicare based on episodes of care. An episode of care is defined as a length of stay up to 60 days, with multiple continuous episodes allowed. A base episode payment is established by the Medicare program through federal legislation. The base episode payment can be adjusted based on each patient’s health including clinical condition, functional abilities, and service needs, as well as for the applicable geographic wage index, low utilization, patient transfers, and other factors. The services covered by the episode payment include all disciplines of care in addition to medical supplies. A portion of reimbursement from each Medicare episode is billed near the start of each episode, and cash is typically received before all services are rendered. Revenue for the episode of care is recorded over an average length of treatment period using a calendar day prorating method. The amount of revenue recognized for episodes of care which are incomplete at period end is based on the pro rata number of days in the episode which have been completed as of the period end date. As of December 31, 2017 , the difference between the cash received from Medicare for a request for anticipated payment on episodes in progress and the associated estimated revenue was not material and was recorded in Other current liabilities in our condensed consolidated balance sheets. We are subject to certain Medicare regulations affecting outlier revenue if our patient’s care was unusually costly. Regulations require a cap on all outlier revenue at 10% of total Medicare revenue received by each provider during a cost reporting year. Management has reviewed the potential cap. Reserves recorded for the outlier cap were not material as of December 31, 2017 . For episodic-based rates that are paid by other insurance carriers, including Medicare Advantage, we recognize revenue in a similar manner as discussed above for Medicare revenues. However, these rates can vary based upon the negotiated terms. For non-episodic-based revenue, gross revenue is recorded on an accrual basis based upon the date of service at amounts equal to our established or estimated per-visit rates. Contractual allowances are recorded for the differences between our standard rates and the applicable contracted rates. Hospice Medicare revenues for hospice are recorded on an accrual basis based on the number of days a patient has been on service at amounts equal to an estimated daily or hourly payment rate. The payment rate is dependent on whether a patient is receiving routine home care, general inpatient care, continuous home care or respite care. Adjustments to Medicare revenues are recorded based on an inability to obtain appropriate billing documentation or authorizations acceptable to the payor or other reasons unrelated to credit risk. Hospice companies are subject to two specific payment limit caps under the Medicare program. One limit relates to inpatient care days that exceed 20% of the total days of hospice care provided for the year. The second limit relates to an aggregate Medicare reimbursement cap calculated by the Medicare fiscal intermediary. Reserves recorded for these caps were not material as of December 31, 2017 . For non-Medicare hospice revenues, we record gross revenue on an accrual basis based upon the date of service at amounts equal to our established rates or estimated per day rates, as applicable. Contractual adjustments are recorded for the difference between our established rates and the amounts estimated to be realizable from patients and third parties for services provided and are deducted from gross revenue to determine our net service revenue. We are subject to changes in government legislation that could impact Medicare payment levels and changes in payor patterns that may impact the level and timing of payments for services rendered. Cash and Cash Equivalents— Cash and cash equivalents include highly liquid investments with maturities of three months or less when purchased. Carrying values of Cash and cash equivalents approximate fair value due to the short-term nature of these instruments. We maintain amounts on deposit with various financial institutions, which may, at times, exceed federally insured limits. However, management periodically evaluates the credit-worthiness of those institutions, and we have not experienced any losses on such deposits. Marketable Securities— We record all equity securities with readily determinable fair values and for which we do not exercise significant influence as available-for-sale securities. We carry the available-for-sale securities at fair value and report unrealized holding gains or losses, net of income taxes, in Accumulated other comprehensive loss , which is a separate component of shareholders’ equity. We recognize realized gains and losses in our consolidated statements of operations using the specific identification method. Unrealized losses are charged against earnings when a decline in fair value is determined to be other than temporary. Management reviews several factors to determine whether a loss is other than temporary, such as the length of time a security is in an unrealized loss position, the extent to which fair value is less than cost, the financial condition and near term prospects of the issuer, industry, or geographic area and our ability and intent to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value. Accounts Receivable and Allowance for Doubtful Accounts— We report accounts receivable at estimated net realizable amounts from services rendered from federal and state agencies (under the Medicare and Medicaid programs), managed care health plans, commercial insurance companies, workers’ compensation programs, employers, and patients. Our accounts receivable are geographically dispersed, but a significant portion of our revenues are concentrated by type of payors. The concentration of net patient service accounts receivable by payor class, as a percentage of total net patient service accounts receivable, is as follows: As of December 31, 2017 2016 Medicare 75.1 % 73.0 % Managed care and other discount plans, including Medicare Advantage 17.4 % 18.5 % Medicaid 2.4 % 2.7 % Other third-party payors 2.9 % 3.3 % Workers' compensation 1.3 % 1.6 % Patients 0.9 % 0.9 % Total 100.0 % 100.0 % While revenues and accounts receivable from the Medicare program are significant to our operations, we do not believe there are significant credit risks associated with this government agency. We do not believe there are any other significant concentrations of revenues from any particular payor that would subject us to any significant credit risks in the collection of our accounts receivable. We provide for accounts receivable that could become uncollectible by establishing an allowance to reduce the carrying value of such receivables to their estimated net realizable value. Additions to the allowance for doubtful accounts are made by means of the Provision for doubtful accounts . We write off uncollectible accounts (after exhausting collection efforts) against the allowance for doubtful accounts. Subsequent recoveries are recorded via the Provision for doubtful accounts . We estimate our allowance for doubtful accounts based on the aging of our accounts receivable, our historical collection experience for each type of payor, and other relevant factors so that the remaining receivables, net of allowances, are reflected at their estimated net realizable values. Accounts requiring collection efforts are reviewed via system-generated work queues that automatically stage (based on age and size of outstanding balance) accounts requiring collection efforts for patient account representatives. Collection efforts include contacting the applicable party (both in writing and by telephone), providing information (both financial and clinical) to allow for payment or to overturn payor decisions to deny payment, and arranging payment plans with self-pay patients, among other techniques. When we determine all in-house efforts have been exhausted or it is a more prudent use of resources, accounts may be turned over to a collection agency. Accounts are written off after all collection efforts (internal and external) have been exhausted. The collection of outstanding receivables from Medicare, managed care payors, other third-party payors, and patients is our primary source of cash and is critical to our operating performance. While it is our policy to verify insurance prior to a patient being admitted, there are various exceptions that can occur. Such exceptions include instances where we are (1) unable to obtain verification because the patient’s insurance company was unable to be reached or contacted, (2) a determination is made that a patient may be eligible for benefits under various government programs, such as Medicaid, and it takes several days, weeks, or months before qualification for such benefits is confirmed or denied, and (3) the patient is transferred to our hospital from an acute care hospital without having access to a credit card, cash, or check to pay the applicable patient responsibility amounts (i.e., deductibles and co-payments). Our primary collection risks relate to patient responsibility amounts and claims reviews conducted by MACs. Patient responsibility amounts include accounts for which the patient was the primary payor or the primary insurance carrier has paid the amounts covered by the applicable agreement, but patient co-payment amounts remain outstanding. Changes in the economy, such as increased unemployment rates or periods of recession, can further exacerbate our ability to collect patient responsibility amounts. For several years, under programs designated as “widespread probes,” certain of our MACs have conducted claims reviews of our billings and have denied payment for certain diagnosis codes. The majority of the denials we have encountered in these probes derive from two of our MACs and relate to determinations regarding medical necessity and provision of therapy services. We dispute, or “appeal,” most of these denials, and for claims we choose to take to administrative law judge hearings, we have historically experienced a success rate of approximately 70% . The resolution of these disputes can take in excess of three years, and we cannot provide assurance as to our ongoing and future success of these disputes. As such, we make provisions against these receivables in accordance with our accounting policy that necessarily considers historical collection trends of the receivables in this review process as part of our Provision for doubtful accounts . Because we do not write-off receivables until all collection efforts have been exhausted, we do not write off receivables related to denied claims while they are in this review process. When the amount collected related to denied claims differs from the net amount previously recorded, these collection differences are recorded in the Provision for doubtful accounts . As a result, the timing of these denials by MACs and their subsequent collection can create volatility in our Provision for doubtful accounts . If actual results are not consistent with our assumptions and judgments, we may be exposed to gains or losses that could be material. Changes in general economic conditions, business office operations, payor mix, or trends in federal or state governmental and private employer healthcare coverage could affect our collection of accounts receivable, financial position, results of operations, and cash flows. Property and Equipment— We report land, buildings, improvements, vehicles, and equipment at cost, net of accumulated depreciation and amortization and any asset impairments. We report assets under capital lease obligations at the lower of fair value or the present value of the aggregate future minimum lease payments at the beginning of the lease term. We depreciate our assets using the straight-line method over the shorter of the estimated useful life of the assets or life of the lease term, excluding any lease renewals, unless the lease renewals are reasonably assured. Useful lives are generally as follows: Years Buildings 10 to 30 Leasehold improvements 2 to 15 Vehicles 5 Furniture, fixtures, and equipment 3 to 10 Assets under capital lease obligations: Real estate 15 to 25 Vehicles 3 Equipment 3 to 5 Maintenance and repairs of property and equipment are expensed as incurred. We capitalize replacements and betterments that increase the estimated useful life of an asset. We capitalize pre-acquisition costs when they are directly identifiable with a specific property, the costs would be capitalizable if the property were already acquired, and acquisition of the property is probable. We capitalize interest expense on major construction and development projects while in progress. We retain fully depreciated assets in property and accumulated depreciation accounts until we remove them from service. In the case of sale, retirement, or disposal, the asset cost and related accumulated depreciation balances are removed from the respective accounts, and the resulting net amount, less any proceeds, is included as a component of income from continuing operations in the consolidated statements of operations. However, if the sale, retirement, or disposal involves a discontinued operation, the resulting net amount, less any proceeds, is included in the results of discontinued operations. We account for operating leases by recognizing rents, including any rent holidays, on a straight-line basis over the term of the lease. Goodwill and Other Intangible Assets— We are required to test our goodwill and indefinite-lived intangible asset for impairment at least annually, absent some triggering event that would accelerate an impairment assessment. Absent any impairment indicators, we perform this impairment testing as of October 1st of each year. We recognize an impairment charge for an |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations : 2017 Acquisitions Inpatient Rehabilitation During 2017 , we completed the following inpatient rehabilitation acquisitions, none of which were individually material to our financial position, results of operations, or cash flows. Each acquisition was made to enhance our position and ability to provide inpatient rehabilitation services to patients in the applicable geographic areas. • In April 2017, we acquired 80% of the 33 -bed inpatient rehabilitation unit of Memorial Hospital at Gulfport in Gulfport, Mississippi, through a joint venture with Memorial Hospital at Gulfport. This acquisition was funded on March 31, 2017 using cash on hand. • In April 2017, we also acquired approximately 80% of the inpatient rehabilitation unit of Mount Carmel West in Columbus, Ohio, through a joint venture with Mount Carmel Health System. This acquisition was funded through a contribution of a 60 ‑bed de novo inpatient rehabilitation hospital to the consolidated joint venture. • In July 2017, we acquired 50% of the inpatient rehabilitation unit at Jackson-Madison County General Hospital through a joint venture with West Tennessee Healthcare. The acquisition was funded through a contribution of our existing inpatient rehabilitation hospital in Martin, Tennessee to the consolidated joint venture. • In September 2017, we acquired 75% of Heritage Valley Beaver Hospital’s inpatient rehabilitation unit in Beaver, Pennsylvania, through a joint venture with Heritage Valley Health System, Inc. The acquisition was funded through the exchange of 25% of our existing inpatient rehabilitation hospital in Sewickley, Pennsylvania. We accounted for these transactions under the acquisition method of accounting and reported the results of operations of the acquired hospitals from their respective dates of acquisition. Assets acquired were recorded at their estimated fair values as of the respective acquisition dates. The fair values of the identifiable intangible assets were based on valuations using the income approach. The income approach is based on management’s estimates of future operating results and cash flows discounted using a weighted-average cost of capital that reflects market participant assumptions. The excess of the fair value of the consideration conveyed over the fair value of the net assets acquired was recorded as goodwill. The goodwill reflects our expectations of our ability to gain access to and penetrate the acquired hospital’s historical patient base and the benefits of being able to leverage operational efficiencies with favorable growth opportunities based on positive demographic trends in these markets. None of the goodwill recorded as a result of these transactions is deductible for federal income tax purposes. The fair value of the assets acquired at the acquisition date were as follows (in millions): Property and equipment $ 0.1 Identifiable intangible assets: Noncompete agreements (useful lives of 2 to 3 years) 0.6 Trade name (useful life of 20 years) 0.5 Certificate of need (useful life of 20 years) 9.8 Goodwill 24.0 Total assets acquired $ 35.0 Information regarding the net cash paid for the inpatient rehabilitation acquisitions during 2017 is as follows (in millions): Fair value of assets acquired $ 11.0 Goodwill 24.0 Fair value of noncontrolling interest owned by joint venture partner (24.1 ) Net cash paid for acquisition $ 10.9 Home Health and Hospice During 2017 , we completed the following home health acquisitions, none of which were individually material to our financial position, results of operations, or cash flows. Each acquisition was made to enhance our position and ability to provide post-acute healthcare services to patients in the applicable geographic areas. Each acquisition was funded using cash on hand. • In February 2017, we acquired the assets of Celtic Healthcare of Maryland, Inc., a home health provider with locations in Owings Mill, Maryland and Rockville, Maryland. • In February 2017, we also acquired the assets of two home health locations from Community Health Services, Inc., located in Owensboro, Kentucky and Elizabethtown, Kentucky. • In May 2017, we acquired the assets of two home health locations from Bio Care Home Health Services, Inc. and Kinsman Enterprises, Inc., located in Irving, Texas and Longview, Texas. • In July 2017, we acquired the assets of four home health locations from VNA Healthtrends, located in Bourbonnais, Illinois; Des Plaines, Illinois; Schererville, Indiana; and Tempe, Arizona. • In August 2017, we acquired the assets of two home health locations from VNA Healthtrends, located in Canton, Ohio and Forsyth, Illinois. • In October 2017, we acquired the assets of a home health location from Ware Visiting Nurses Services, Inc. located in Savannah, Georgia; and • In October 2017, we also acquired the assets of a home health location from Pickens County Health Care Authority located in Carrollton, Alabama. We accounted for these transactions under the acquisition method of accounting and reported the results of operations of the acquired locations from their respective dates of acquisition. Assets acquired or liabilities assumed were recorded at their estimated fair values as of the respective acquisition dates. The fair values of identifiable intangible assets were based on valuations using the cost and income approaches. The cost approach is based on amounts that would be required to replace the asset (i.e., replacement cost). The income approach is based on management’s estimates of future operating results and cash flows discounted using a weighted-average cost of capital that reflects market participant assumptions. The excess of the fair value of the consideration conveyed over the fair value of the net assets acquired was recorded as goodwill. The goodwill reflects our expectations of our ability to utilize the acquired locations’ mobile workforce and established relationships within each community and the benefits of being able to leverage operational efficiencies with favorable growth opportunities based on positive demographic trends in these markets. All of the goodwill recorded as a result of these transactions is deductible for federal income tax purposes. The fair value of the assets acquired and liabilities assumed at the acquisition date were as follows (in millions): Total current assets $ 0.1 Identifiable intangible asset: Noncompete agreements (useful lives of 5 years) 0.8 Trade name (useful life of 1 year) 0.1 Certificates of need (useful lives of 10 years) 1.8 Licenses (useful lives of 10 years) 4.0 Goodwill 21.4 Total assets acquired 28.2 Total liabilities assumed (0.3 ) Net assets acquired $ 27.9 Information regarding the net cash paid for the home health acquisitions during 2017 is as follows (in millions): Fair value of assets acquired $ 6.8 Goodwill 21.4 Fair value of liabilities assumed (0.3 ) Net cash paid for acquisitions $ 27.9 Pro Forma Results of Operations The following table summarizes the results of operations of the above mentioned acquisitions from their respective dates of acquisition included in our consolidated results of operations and the unaudited pro forma results of operations of the combined entity had the date of the acquisitions been January 1, 2016 (in millions): Net Operating Revenues Net (Loss) Income Attributable to Encompass Health Acquired entities only: Actual from acquisition date to December 31, 2017 $ 32.9 $ (6.3 ) Combined entity: Supplemental pro forma from 01/01/2017-12/31/2017 (unaudited) 3,996.1 260.3 Combined entity: Supplemental pro forma from 01/01/2016-12/31/2016 (unaudited) 3,771.5 254.8 The information presented above is for illustrative purposes only and is not necessarily indicative of results that would have been achieved if the acquisitions had occurred as of the beginning of our 2016 reporting period. 2016 Acquisitions Inpatient Rehabilitation During 2016, we completed the following inpatient rehabilitation hospital acquisitions, none of which were individually material to our financial position, results of operations, or cash flows. Each acquisition was made to enhance our position and ability to provide inpatient rehabilitation services to patients in the applicable geographic areas. Each acquisition was funded through a contribution to the respective consolidated joint venture. • In February 2016, we acquired 50% of the inpatient rehabilitation hospital at CHI St. Vincent Hot Springs, a 20 -bed inpatient rehabilitation hospital in Hot Springs, Arkansas, through a joint venture with St. Vincent Community Health Services, Inc. • In August 2016, we acquired 50% of the inpatient rehabilitation hospital at St. Joseph Regional Health Center, a 19 -bed inpatient rehabilitation hospital in Bryan, Texas, through a joint venture with St. Joseph Health System. • In August 2016, we also acquired 51% of the inpatient rehabilitation hospital at The Bernsen Rehabilitation Center at St. John, a 24 -bed inpatient rehabilitation hospital in Broken Arrow, Oklahoma, through a joint venture with St. John Health System. We accounted for these transactions under the acquisition method of accounting and reported the results of operations of the acquired hospitals from their respective dates of acquisition. Assets acquired and liabilities assumed, if any, were recorded at their estimated fair values as of the respective acquisition dates. The fair values of the identifiable intangible assets were based on valuations using the income approach. The income approach is based on management’s estimates of future operating results and cash flows discounted using a weighted-average cost of capital that reflects market participant assumptions. The excess of the fair value of the consideration conveyed over the fair value of the net assets acquired was recorded as goodwill. The goodwill reflects our expectations of our ability to gain access to and penetrate the acquired hospital’s historical patient base and the benefits of being able to leverage operational efficiencies with favorable growth opportunities based on positive demographic trends in these markets. None of the goodwill recorded as a result of these transactions is deductible for federal income tax purposes. The fair value of the assets acquired at the acquisition date were as follows (in millions): Property and equipment $ 5.3 Identifiable intangible assets: Noncompete agreements (useful lives of 1 to 3 years) 0.4 Trade names (useful lives of 20 years) 1.0 Goodwill 9.4 Total assets acquired $ 16.1 Information regarding the net cash paid for all inpatient rehabilitation acquisitions during 2016 is as follows (in millions): Fair value of assets acquired $ 6.7 Goodwill 9.4 Fair value of noncontrolling interest owned by joint venture partner (16.1 ) Net cash paid for acquisition $ — See also Note 8, Investments in and Advances to Nonconsolidated Affiliates . Home Health and Hospice During 2016, we completed the following home health and hospice acquisitions, none of which were individually material to our financial position, results of operations, or cash flows. Each acquisition was made to enhance our position and ability to provide post-acute healthcare services to patients in the applicable geographic areas. Each acquisition was funded using cash on hand. • In May 2016, we acquired Home Health Agency of Georgia, LLC, a home health and hospice provider with two home health locations and two hospice locations in the Greater Atlanta area. • In July 2016, we acquired Advantage Health Inc., a home health provider with one location in Yuma, Arizona. • In September 2016, we acquired three hospice agencies from Sotto International, Inc. located in Texarkana, Arkansas; Magnolia, Arkansas; and Texarkana, Texas. • In October 2016, we acquired two home health agencies from Summit Home Health Care, Inc. located in Cheyenne, Wyoming and Laramie, Wyoming. • In October 2016, we also acquired LightHouse Health Care, Inc., a home health provider with one location in Springfield, Virginia. • In November 2016, we acquired Gulf City Home Care, Inc., a home health provider with one location in Sarasota, Florida. • In November 2016, we also acquired Honor Hospice, LLC, a hospice provider with one location in Wheat Ridge, Colorado. We accounted for all of these transactions under the acquisition method of accounting and reported the results of operations of the acquired locations from their respective dates of acquisition. Assets acquired and liabilities assumed were recorded at their estimated fair values as of the respective acquisition dates. The fair values of identifiable intangible assets were based on valuations using the cost and income approaches. The cost approach is based on amounts that would be required to replace the asset (i.e., replacement cost). The income approach is based on management’s estimates of future operating results and cash flows discounted using a weighted-average cost of capital that reflects market participant assumptions. The excess of the fair value of the consideration conveyed over the fair value of the net assets acquired was recorded as goodwill. The goodwill reflects our expectations of our ability to utilize the acquired locations’ mobile workforce and established relationships within each community and the benefits of being able to leverage operational efficiencies with favorable growth opportunities based on positive demographic trends in these markets. All goodwill recorded as a result of these transactions is deductible for federal income tax purposes. The fair value of the assets acquired and liabilities assumed at the acquisition date were as follows (in millions): Identifiable intangible asset: Noncompete agreements (useful lives of 5 years) $ 1.1 Trade names (useful lives of 1 year) 0.7 Certificate of needs (useful lives of 10 years) 1.9 Licenses (useful lives of 10 years) 3.4 Goodwill 41.4 Total assets acquired 48.5 Total liabilities assumed (0.4 ) Net assets acquired $ 48.1 Information regarding the net cash paid for home health and hospice acquisitions during 2016 is as follows (in millions): Fair value of assets acquired $ 7.1 Goodwill 41.4 Fair value of liabilities assumed (0.4 ) Net cash paid for acquisitions $ 48.1 Pro Forma Results of Operations The following table summarizes the results of operations of the above mentioned inpatient rehabilitation hospitals and home health and hospice agencies from their respective dates of acquisition included in our consolidated results of operations and the unaudited pro forma results of operations of the combined entity had the date of the acquisitions been January 1, 2015 (in millions): Net Operating Revenues Net (Loss) Income Attributable to Encompass Health Acquired entities only: Actual from acquisition date to December 31, 2016 $ 27.4 $ (2.2 ) Combined entity: Supplemental pro forma from 1/01/2016-12/31/2016 (unaudited) 3,745.6 252.2 Combined entity: Supplemental pro forma from 1/01/2015-12/31/2015 (unaudited) 3,217.1 187.3 The information presented above is for illustrative purposes only and is not necessarily indicative of results that would have been achieved if the acquisitions had occurred as of the beginning of our 2015 reporting period. 2015 Acquisitions Inpatient Rehabilitation Reliant Acquisition In October 2015, we completed the previously announced acquisition of the operations of Reliant Hospital Partners, LLC and affiliated entities (“Reliant”). Reliant operates a portfolio of 11 inpatient rehabilitation hospitals in Texas, Massachusetts, and Ohio with a total of 902 beds. All of the Reliant hospitals are leased, and seven of the leases are treated as capital leases for accounting purposes. We assumed all of these lease obligations. The amount of the capital lease obligation initially recognized on our balance sheet was approximately $210 million . At closing, one Reliant hospital entity had a remaining minority limited partner interest of 0.5% . The cash purchase price was reduced by the estimated fair value of this interest. We funded the cash purchase price in the acquisition with proceeds from our August and September 2015 senior notes issuances and borrowings under our senior secured credit facility. See Note 9, Long-term Debt . With this acquisition, we are able to offer comprehensive, high-quality and cost-effective facility-based care across new and existing service areas. We expect approximately 86% of the goodwill resulting from this transaction to be deductible for federal income tax purposes. The goodwill reflects our expectations of our ability to gain access to and penetrate each acquired hospital’s historical patient base and the benefits of being able to leverage operational efficiencies with favorable growth opportunities based on positive demographic trends in these markets. We accounted for this transaction under the acquisition method of accounting and reported the results of operations of Reliant from its date of acquisition. Assets acquired, liabilities assumed, and noncontrolling interests were recorded at their estimated fair values as of the acquisition date. Estimated fair values were based on various valuation methodologies including: replacement cost and continued use methods for property and equipment; an income approach using primarily discounted cash flow techniques for the noncompete and license intangible assets and capital lease liabilities; an income approach utilizing the relief-from-royalty method for the trade name intangible assets; an income approach utilizing the excess earnings method for the certificate of need intangible assets; and an estimated realizable value approach using historical trends and other relevant information for accounts receivable and certain accrued liabilities. The aforementioned income methods utilize management’s estimates of future operating results and cash flows discounted using a weighted average cost of capital that reflects market participant assumptions. For all other assets and liabilities, the fair value was assumed to represent carrying value due to their short maturities. The excess of the fair value of the consideration conveyed over the fair value of the net assets acquired was recorded as goodwill. The fair value of the assets acquired and liabilities assumed at the acquisition date for Reliant were as follows (in millions): Cash and cash equivalents $ 42.6 Accounts receivable 25.7 Prepaid expenses and other current assets 2.8 Property and equipment 220.6 Identifiable intangible assets: Noncompete agreements (useful lives of 1 to 2 years) 9.7 Trade names (useful lives of 20 years) 8.9 Certificates of need (useful lives of 20 years) 36.6 Licenses (useful lives of 20 years) 11.4 Goodwill 642.6 Other long-term assets 0.9 Total assets acquired 1,001.8 Liabilities assumed: Current portion of long-term debt 4.1 Accounts payable 1.7 Accrued payroll 3.7 Other current liabilities 10.8 Long-term debt, net of current portion 205.8 Deferred tax liabilities 3.9 Total liabilities assumed 230.0 Noncontrolling interests 0.4 Net assets acquired $ 771.4 Information regarding the net cash paid for the acquisition of Reliant is as follows (in millions): Fair value of assets acquired, net of $42.6 million of cash acquired $ 316.6 Goodwill 642.6 Fair value of liabilities assumed (230.0 ) Noncontrolling interests (0.4 ) Net cash paid for acquisition $ 728.8 Other Inpatient Rehabilitation Acquisitions In April 2015, we acquired 83% of the inpatient rehabilitation hospital at Memorial University Medical Center (“Memorial”), a 50 -bed inpatient rehabilitation hospital in Savannah, Georgia, through a joint venture with Memorial Health. The joint venture, which was funded using cash on hand, was not material to our financial position, results of operations, or cash flows. The Memorial transaction was made to enhance our position and ability to provide inpatient rehabilitative services to patients in Savannah and its surrounding areas. As a result of this transaction, Goodwill increased by $0.7 million , none of which is deductible for federal income tax purposes. In May 2015, we acquired Cardinal Hill Rehabilitation Hospital (“Cardinal Hill”), comprised of 158 licensed inpatient rehabilitation beds, 74 licensed skilled nursing beds, and one home health location, in Lexington, Kentucky. This acquisition was made to enhance our position and ability to provide inpatient rehabilitative and home health services to patients in Lexington, Kentucky and its surrounding areas. The acquisition, which was funded using availability under our revolving credit facility, was not material to our financial position, results of operations, or cash flows. Goodwill did not increase as a result of this transaction. We accounted for these transactions under the acquisition method of accounting and reported the results of operations of the acquired hospitals from their respective dates of acquisition. Assets acquired, liabilities assumed, and noncontrolling interests, if any, were recorded at their estimated fair values as of the respective acquisition dates. The fair values of identifiable intangible assets were based on valuations using the cost and income approaches. The cost approach is based on amounts that would be required to replace the asset (i.e., replacement cost). The income approach, which was also used to estimate the fair value of any noncontrolling interest, is based on management’s estimates of future operating results and cash flows discounted using a weighted-average cost of capital that reflects market participant assumptions. The excess of the fair value of the consideration conveyed over the fair value of the net assets acquired, if any, was recorded as goodwill. The goodwill reflects our expectations of our ability to gain access to and penetrate the acquired or consolidated hospitals’ historical patient base and the benefits of being able to leverage operational efficiencies with favorable growth opportunities based on positive demographic trends in these markets. The fair value of the assets acquired and liabilities assumed at the acquisition dates for the other inpatient rehabilitation transactions completed in 2015 were as follows (in millions): Total current assets $ 10.1 Property and equipment 42.7 Identifiable intangible assets: Noncompete agreements (useful lives of 2 to 3 years) 0.1 Trade names (useful lives of 20 years) 0.8 Certificates of need (useful lives of 20 years) 8.8 Licenses (useful lives of 20 years) 0.2 Goodwill 0.7 Total assets acquired 63.4 Total liabilities assumed (2.7 ) Net assets acquired $ 60.7 Information regarding the net cash paid for other inpatient rehabilitation acquisitions during 2015 is as follows (in millions): Fair value of assets acquired $ 62.8 Goodwill 0.7 Fair value of liabilities assumed (2.7 ) Fair value of noncontrolling interest owned by joint venture partner (4.2 ) Net cash paid for acquisitions $ 56.6 See also Note 8, Investments in and Advances to Nonconsolidated Affiliates . Home Health and Hospice CareSouth Acquisition In November 2015, Encompass, a subsidiary of Encompass Health, completed its previously announced acquisition of the home health agency operations of CareSouth Health System, Inc. (“CareSouth”). CareSouth operates a portfolio of 44 home health agencies and 3 hospice agencies in Alabama, Florida, Georgia, North Carolina, South Carolina, Tennessee, and Virginia. In addition, two of these home health agencies operate as joint ventures which we account for using the equity method of accounting. We funded the cash purchase price in the acquisition with our term loan facility capacity and cash on hand. See Note 9, Long-term Debt . With this acquisition, we are able to offer comprehensive, high-quality and cost-effective home-based care across new and existing service areas. We expect approximately 6.5% of the goodwill resulting from this transaction to be deductible for federal income tax purposes. The goodwill reflects our expectations of favorable growth opportunities in the home health and hospice markets based on positive demographic trends. We accounted for this transaction under the acquisition method of accounting and reported the results of operations of CareSouth from its date of acquisition. Assets acquired, liabilities assumed, and noncontrolling interests were recorded at their estimated fair values as of the acquisition date. Estimated fair values were based on various valuation methodologies including: replacement cost and continued use methods for property and equipment; an income approach using primarily discounted cash flow techniques for the noncompete and license intangible assets and capital lease liabilities; an income approach utilizing the relief-from-royalty method for the trade name intangible asset; an income approach utilizing the excess earnings method for the certificate of need intangible assets; and an estimated realizable value approach using historical trends and other relevant information for accounts receivable and certain accrued liabilities. The aforementioned income methods utilize management’s estimates of future operating results and cash flows discounted using a weighted average cost of capital that reflects market participant assumptions. For all other assets and liabilities, the fair value was assumed to represent carrying value due to their short maturities. The excess of the fair value of the consideration conveyed over the fair value of the net assets acquired was recorded as goodwill. The fair value of the assets acquired and liabilities assumed at the acquisition date for CareSouth were as follows (in millions): Cash and cash equivalents $ 0.4 Accounts receivable 10.5 Prepaid expenses and other current assets 2.0 Property and equipment 0.7 Identifiable intangible assets: Noncompete agreements (useful lives of 3 years) 0.8 Trade name (useful life of 5 years) 2.8 Certificates of need (useful lives of 10 years) 15.6 Licenses (useful lives of 10 years) 13.0 Internal-use software 0.4 Goodwill 143.3 Investment in nonconsolidated subsidiaries 2.2 Total assets acquired 191.7 Liabilities assumed: Current portion of long-term debt 0.1 Accounts payable 2.7 Accrued payroll 2.4 Other current liabilities 2.8 Long-term debt, net of current portion 0.2 Deferred tax liabilties 9.5 Total liabilities assumed 17.7 Noncontrolling interests 4.3 Net assets acquired $ 169.7 Information regarding the net cash paid for the acquisition of CareSouth is as follows (in millions): Fair value of assets acquired, net of $0.4 million of cash acquired $ 48.0 Goodwill 143.3 Fair value of liabilities assumed (17.7 ) Fair value of noncontrolling interest owned by joint venture partner (4.3 ) Net cash paid for acquisitions $ 169.3 Other Home Health and Hospice Acquisitions Other than the CareSouth acquisition discussed above, we completed the following home health and hospice acquisitions, none of which were individually material to our financial position, results of operations, or cash flows. Each acquisition was made to enhance our position and ability to provide post-acute healthcare services to patients in the applicable geographic areas. Each acquisition was funded with cash on hand. • In March 2015, we acquired Integrity Home Health Care, Inc., a home health company with two locations in the Las Vegas, Nevada area. • In April 2015, we acquired Harvey Home Health Services, Inc., a home health company in Houston, Texas. • In May 2015, we acquired Heritage Home Health Care, LLC, a home health company in Texarkana, Arkansas. • In June 2015, we acquired Washington County Home Health Care, Inc. and Benton County Home Health, Inc., doing business as Alliance Home Health, a home health company with two locations in the Fayetteville, Arkansas area. • In July 2015, we acquired Southern Utah Home Health, Inc., a home health and hospice company with two home health locations and two hospice locations in southern Utah. • In July 2015, we acquired Orthopedic Rehab Specialist, LLC, a home health company in Ocala, Florida. We accounted for all of these transactions under the acquisition method of accounting and reported the results of operations of the acquired locations from their respective dates of acquisition. Assets acquired and liabilities assumed were recorded at their estimated fair values as of the respective acquisition dates. The fair values of identifiable intangible assets were based on valuations using the cost and income approaches. The cost approach is based on amounts that would be required to replace the asset (i.e., replacement cost). The income approach is based on management’s estimates of future operating results and cash flows discounted using a weighted-average cost of capital that reflects market participant assumptions. The excess of the fair value of the consideration conveyed over the fair value of the net assets acquired was recorded as goodwill. The goodwill reflects our expectations of our ability to utilize the acquired locations’ mobile workforce and established relationships within each community and the benefits of being able to leverage operational efficiencies with favorable growth opportunities based on positive demographic trends in these markets. All goodwill recorded as a result of these transactions is deductible for federal income tax purposes. The fair value of the assets acquired and liabilities assumed at the acquisition dates for the other home health and hospice transactions completed in 2015 were as follows (in millions): Property and equipment $ 0.1 Identifiable intangible assets: Noncompete agreements (useful lives of 2 to 5 years) 1.3 Trade names (useful lives of 1 year) 0.5 Certificates of need (useful lives of 10 years) 4.9 Licenses (useful lives of 10 years) 3.6 Goodwill 20.3 Total assets acquired 30.7 Total liabilities assumed (0.2 ) Net assets acquired $ 30.5 Information regarding the net cash paid for the other home health and hospice acquisitions during 2015 is as follows (in millions): Fair value of assets acquired $ 10.4 Goodwill 20.3 Fair value of liabilities assumed (0.2 ) Net cash paid for acquisitions $ 30.5 2015 Pro Forma Results of Operations The following table summarizes the results of operations of the above mentioned transactions from their respective dates of acquisition included in our consolidated results of operations and the unaudited pro forma results of operations of the combined entity had the date of the acquisitions been January 1, 2014 (in millions): Net Operating Revenues Net Income Acquired entities only: Actual from acquisition date to December 31, 2015: Reliant $ 63.7 $ 11.2 All Other Inpatient 54.7 1.7 CareSouth 19.2 2.5 All Other Home Health and Hospice 17.8 1.2 Combined entity: Supplemental pro forma from 1/01/2015-12/31/2015 (unaudited) 3,479.9 234.0 Combined entity: Supplemental pro forma from 1/01/2014-12/31/2014 (unaudited) 2,851.0 276.9 The information presented above is for illustrative purposes only and is not necessarily indicative of results that would have been achieved if the acquisitions had occurred as of the beginning of our 2014 reporting period. For the Reliant and CareSouth acquisitions, the unaudited pro forma information above includes adjustments for: (1) acquisition costs; (2) amortization of incremental identifiable intangible assets; (3) management fees paid to their former equity holders; (4) interest on debt incurred to fund the acquisitions (see Note 9 , Long-term Debt ); (5) income taxes using a rate of 40% ; and (6) noncontrolling interests. |
Cash and Marketable Securities
Cash and Marketable Securities | 12 Months Ended |
Dec. 31, 2017 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Marketable Securities | Cash and Marketable Securities : The components of our investments as of December 31, 2017 are as follows (in millions): Cash & Cash Equivalents Restricted Cash Restricted Marketable Securities Total Cash $ 54.4 $ 62.4 $ — $ 116.8 Equity securities — — 62.0 62.0 Total $ 54.4 $ 62.4 $ 62.0 $ 178.8 The components of our investments as of December 31, 2016 are as follows (in millions): Cash & Cash Equivalents Restricted Cash Restricted Marketable Securities Total Cash $ 40.5 $ 60.9 $ — $ 101.4 Equity securities — — 57.7 57.7 Total $ 40.5 $ 60.9 $ 57.7 $ 159.1 Restricted Cash— As of December 31, 2017 and 2016 , Restricted cash consisted of the following (in millions): As of December 31, 2017 2016 Affiliate cash $ 18.1 $ 22.9 Self-insured captive funds 44.3 38.0 Total restricted cash $ 62.4 $ 60.9 Affiliate cash represents cash accounts maintained by joint ventures in which we participate where one or more of our external partners requested, and we agreed, that the joint venture’s cash not be commingled with other corporate cash accounts and be used only to fund the operations of those joint ventures. Self-insured captive funds represent cash held at our wholly owned insurance captive, HCS, Ltd., as discussed in Note 10, Self-Insured Risks . These funds are committed to pay third-party administrators for claims incurred and are restricted by insurance regulations and requirements. These funds cannot be used for purposes outside HCS without the permission of the Cayman Islands Monetary Authority. The classification of restricted cash held by HCS as current or noncurrent depends on the classification of the corresponding claims liability. As of December 31, 2017 and 2016 , all restricted cash was current. Marketable Securities— Restricted marketable securities at both balance sheet dates represent restricted assets held at HCS. HCS insures a substantial portion Encompass Health’s professional liability, workers’ compensation, and other insurance claims. These funds are committed for payment of claims incurred, and the classification of these marketable securities as current or noncurrent depends on the classification of the corresponding claims liability. As of December 31, 2017 and 2016 , $44.2 million and $33.5 million , respectively, of restricted marketable securities are included in Other long-term assets in our consolidated balance sheets. A summary of our restricted marketable securities as of December 31, 2017 is as follows (in millions): Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Equity securities $ 64.0 $ 0.3 $ (2.3 ) $ 62.0 A summary of our restricted marketable securities as of December 31, 2016 is as follows (in millions): Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Equity securities $ 59.6 $ 0.2 $ (2.1 ) $ 57.7 Cost in the above tables includes adjustments made to the cost basis of our equity securities for other-than-temporary impairments. During the years ended December 31, 2017 , 2016 , and 2015 , we did not record any impairment charges related to our restricted marketable securities. Investing information related to our restricted marketable securities is as follows (in millions): For the Year Ended December 31, 2017 2016 2015 Proceeds from sales of restricted available-for-sale securities $ 4.0 $ — $ — Proceeds from sales of nonrestricted available-for-sale securities $ — $ — $ 12.8 Gross realized gains $ — $ — $ 1.2 Gross realized losses $ — $ — $ — Our portfolio of marketable securities is comprised of investments in mutual funds that hold investments in a variety of industries and geographies. As discussed in Note 1, Summary of Significant Accounting Policies , “Marketable Securities,” when our portfolio includes marketable securities with unrealized losses that are not deemed to be other-than-temporarily impaired, we examine the severity and duration of the impairments in relation to the cost of the individual investments. We also consider the industry and geography in which each investment is held and the near-term prospects for a recovery in each. |
Variable Interest Entities
Variable Interest Entities | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | Variable Interest Entities : As of December 31, 2017 and December 31, 2016 , we consolidated ten limited partnership-like entities that are VIEs and of which we are the primary beneficiary. Our ownership percentages in these entities range from 6.8% to 99.5% . Through partnership and management agreements with or governing each of these entities, we manage all of these entities and handle all day-to-day operating decisions. Accordingly, we have the decision making power over the activities that most significantly impact the economic performance of our VIEs and an obligation to absorb losses or receive benefits from the VIE that could potentially be significant to the VIE. These decisions and significant activities include, but are not limited to, marketing efforts, oversight of patient admissions, medical training, nurse and therapist scheduling, provision of healthcare services, billing, collections and creation and maintenance of medical records. The terms of the agreements governing each of our VIEs prohibit us from using the assets of each VIE to satisfy the obligations of other entities. The carrying amounts and classifications of the consolidated VIEs’ assets and liabilities, which are included in our consolidated balance sheet, are as follows (in millions): December 31, 2017 December 31, 2016 Assets Current assets: Cash and cash equivalents $ 1.2 $ 1.6 Restricted cash 3.5 3.8 Accounts receivable, net of allowance for doubtful accounts 32.6 30.8 Other current assets 2.1 2.0 Total current assets 39.4 38.2 Property and equipment, net 142.8 140.0 Goodwill 73.5 73.5 Intangible assets, net 7.7 9.6 Deferred income tax assets 0.7 0.6 Other long-term assets — 0.4 Total assets $ 264.1 $ 262.3 Liabilities Current liabilities: Current portion of long-term debt $ 1.8 $ 1.5 Accounts payable 6.5 6.8 Accrued payroll 7.1 6.6 Accrued interest payable 0.2 0.2 Other current liabilities 8.6 5.4 Total current liabilities 24.2 20.5 Long-term debt, net of current portion 28.3 29.8 Total liabilities $ 52.5 $ 50.3 |
Accounts Receivable
Accounts Receivable | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Accounts Receivable | Accounts Receivable : Accounts receivable consists of the following (in millions): As of December 31, 2017 2016 Current: Patient accounts receivable, net of allowance for doubtful accounts of $60.9 million in 2017; $53.9 million in 2016 $ 459.5 $ 432.0 Other accounts receivable 12.6 11.8 472.1 443.8 Noncurrent patient accounts receivable, net of allowance for doubtful accounts of $52.2 million in 2017; $49.5 million in 2016 129.1 125.9 Accounts receivable, net $ 601.2 $ 569.7 Because the resolution of claims that are part of Medicare audit programs can take in excess of three years, we review the patient receivables that are part of this adjudication process to determine their appropriate classification as either current or noncurrent. Amounts considered noncurrent are included in Other long-term assets in our consolidated balance sheet. At December 31, 2017 and 2016 , our allowance for doubtful accounts represented approximately 16.1% and 15.6% , respectively, of the total patient due accounts receivable balance. The following is the activity related to our allowance for doubtful accounts (in millions): For the Year Ended December 31, Balance at Beginning of Period Additions and Charges to Expense Deductions and Accounts Written Off Balance at End of Period 2017 $ 103.4 $ 52.4 $ (42.7 ) $ 113.1 2016 $ 71.6 $ 61.2 $ (29.4 ) $ 103.4 2015 $ 43.0 $ 47.2 $ (18.6 ) $ 71.6 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment : Property and equipment consists of the following (in millions): As of December 31, 2017 2016 Land $ 125.4 $ 125.3 Buildings 1,712.4 1,601.4 Leasehold improvements 138.1 115.2 Vehicles 16.2 11.8 Furniture, fixtures, and equipment 461.5 425.3 2,453.6 2,279.0 Less: Accumulated depreciation and amortization (1,097.8 ) (982.4 ) 1,355.8 1,296.6 Construction in progress 161.3 95.2 Property and equipment, net $ 1,517.1 $ 1,391.8 As of December 31, 2017 , approximately 72% of our consolidated Property and equipment, net held by Encompass Health Corporation and its guarantor subsidiaries was pledged to the lenders under our credit agreement. See Note 9, Long-term Debt , and Note 20, Condensed Consolidating Financial Information . In February 2016, we entered into a development/lease agreement with CR HQ, LLC (the “Developer”) to construct our new home office in Birmingham, Alabama. Under the terms of this agreement, the Developer is responsible for all costs of constructing the new facility ‘shell’ which will then be leased to us for an initial term of 15 years with four , five -year renewal options. The lease is expected to commence in the first half of 2018. We are responsible for the costs associated with improvements to the interior of the building. Due to the nature and extent of the tenant improvements we will be making to the new home office and certain provisions of the development/lease agreement, we are deemed to be the accounting owner of the new home office during the construction period. Construction commenced in the second quarter of 2016. As of December 31, 2017 and 2016 , Property and equipment, net includes $49.8 million and $20.3 million , respectively, for the construction costs incurred to date by the Developer, and Long-term debt, net of current portion includes a corresponding financing obligation liability of $49.5 million and $20.3 million , respectively. The remaining corresponding financing obligation liability of $0.3 million as of December 31, 2017 is included in the Current portion of long-term debt . It is estimated the total financing obligation associated with the Developer’s costs to construct the new home office will be $56 million . The amounts recorded for construction costs and the corresponding liability are noncash activities for purposes of our consolidated statement of cash flows. See Note 9, Long-term Debt . Information related to fully depreciated assets and assets under capital lease obligations is as follows (in millions): As of December 31, 2017 2016 Fully depreciated assets $ 318.6 $ 289.7 Assets under capital lease obligations: Buildings $ 329.6 $ 331.0 Vehicles 13.0 8.6 Equipment 0.3 0.3 342.9 339.9 Less: Accumulated amortization (104.6 ) (83.5 ) Assets under capital lease obligations, net $ 238.3 $ 256.4 The amount of depreciation expense, amortization expense relating to assets under capital lease obligations, interest capitalized, and rent expense under operating leases is as follows (in millions): For the Year Ended December 31, 2017 2016 2015 Depreciation expense $ 111.8 $ 102.3 $ 91.0 Amortization expense $ 22.7 $ 21.8 $ 12.7 Interest capitalized $ 3.7 $ 2.0 $ 1.3 Rent expense: Minimum rent payments $ 66.5 $ 62.6 $ 48.8 Contingent and other rents 24.1 29.4 21.6 Other 8.9 4.0 3.8 Total rent expense $ 99.5 $ 96.0 $ 74.2 Leases— We lease certain land, buildings, and equipment under noncancelable operating leases generally expiring at various dates through 2028 . We also lease certain buildings and equipment under capital leases generally expiring at various dates through 2037 . Operating leases generally have 1 - to 15 -year terms, with one or more renewal options, with terms to be negotiated at the time of renewal. Various facility leases include provisions for rent escalation to recognize increased operating costs or require us to pay certain maintenance and utility costs. Contingent rents are included in rent expense in the year incurred. Some facilities are subleased to other parties. Rental income from subleases approximated $2.9 million , $4.1 million , and $5.0 million for the years ended December 31, 2017 , 2016 , and 2015 , respectively. Total expected future minimum rentals under these noncancelable subleases approximated $0.8 million as of December 31, 2017 . Certain leases contain annual escalation clauses based on changes in the Consumer Price Index while others have fixed escalation terms. The excess of cumulative rent expense (recognized on a straight-line basis) over cumulative rent payments made on leases with fixed escalation terms is recognized as straight-line rental accrual and is included in Other long-term liabilities in the accompanying consolidated balance sheets, as follows (in millions): As of December 31, 2017 2016 Straight-line rental accrual $ 11.2 $ 11.8 Future minimum lease payments at December 31, 2017 , for those leases having an initial or remaining noncancelable lease term in excess of one year, are as follows (in millions): Year Ending December 31, Operating Leases Capital Lease Obligations Total 2018 $ 65.0 $ 36.4 $ 101.4 2019 59.5 33.2 92.7 2020 49.9 28.8 78.7 2021 39.7 28.4 68.1 2022 28.3 28.7 57.0 2023 and thereafter 159.3 327.7 487.0 $ 401.7 483.2 $ 884.9 Less: Interest portion (211.7 ) Obligations under capital leases $ 271.5 In addition to the above, and as discussed in Note 9, Long-term Debt , “Other Notes Payable,” we have two sale/leaseback transactions involving real estate accounted for as financings. Future minimum payments, which are accounted for as interest, under these obligations are $2.7 million in each of the next four years, $2.5 million in year five, and $3.2 million thereafter. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets : The following table shows changes in the carrying amount of Goodwill for the years ended December 31, 2017 , 2016 , and 2015 (in millions): Inpatient Rehabilitation Home Health and Hospice Consolidated Goodwill as of December 31, 2014 $ 491.5 $ 592.5 $ 1,084.0 Acquisitions 641.6 164.5 806.1 Goodwill as of December 31, 2015 1,133.1 757.0 1,890.1 Acquisitions 8.9 42.5 51.4 Divestiture of pediatric home health services — (14.3 ) (14.3 ) Goodwill as of December 31, 2016 1,142.0 785.2 1,927.2 Acquisitions 24.0 21.4 45.4 Goodwill as of December 31, 2017 $ 1,166.0 $ 806.6 $ 1,972.6 Goodwill increased in 2015 as a result of our acquisitions of Reliant, CareSouth, and other inpatient and home health and hospice operations. Goodwill increased in 2016 as a result of our acquisitions of inpatient and home health and hospice operations offset by the divestiture of our pediatric home health assets to Thrive Skilled Pediatric Care in November 2016 for approximately $21 million . We recorded a $3.3 million gain as part of Other operating expenses in our consolidated statements of operations during the year ended December 31, 2016. Goodwill increased in 2017 as a result of our acquisitions of inpatient and home health operations. See Note 2, Business Combinations . We performed impairment reviews as of October 1, 2017 , 2016 , and 2015 and concluded no Goodwill impairment existed. As of December 31, 2017 , we had no accumulated impairment losses related to Goodwill . The following table provides information regarding our other intangible assets (in millions): Gross Carrying Amount Accumulated Amortization Net Certificates of need: 2017 $ 113.7 $ (19.5 ) $ 94.2 2016 98.6 (12.9 ) 85.7 Licenses: 2017 $ 146.0 $ (71.6 ) $ 74.4 2016 142.0 (62.1 ) 79.9 Noncompete agreements: 2017 $ 63.5 $ (55.4 ) $ 8.1 2016 62.2 (47.3 ) 14.9 Trade name - Encompass: 2017 $ 135.2 $ — $ 135.2 2016 135.2 — 135.2 Trade names - all other: 2017 $ 35.1 $ (16.4 ) $ 18.7 2016 34.6 (13.9 ) 20.7 Internal-use software: 2017 $ 201.6 $ (132.3 ) $ 69.3 2016 181.4 (110.2 ) 71.2 Market access assets: 2017 $ 13.2 $ (10.0 ) $ 3.2 2016 13.2 (9.5 ) 3.7 Total intangible assets: 2017 $ 708.3 $ (305.2 ) $ 403.1 2016 667.2 (255.9 ) 411.3 Amortization expense for other intangible assets is as follows (in millions): For the Year Ended December 31, 2017 2016 2015 Amortization expense $ 49.3 $ 48.5 $ 36.0 Total estimated amortization expense for our other intangible assets for the next five years is as follows (in millions): Year Ending December 31, Estimated Amortization Expense 2018 $ 42.4 2019 37.2 2020 30.6 2021 26.1 2022 22.7 |
Investments in and Advances to
Investments in and Advances to Nonconsolidated Affiliates | 12 Months Ended |
Dec. 31, 2017 | |
Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |
Investments in and Advances to Nonconsolidated Affiliates | Investments in and Advances to Nonconsolidated Affiliates : Investments in and advances to nonconsolidated affiliates as of December 31, 2017 represents our investment in six partially owned subsidiaries, of which five are general or limited partnerships, limited liability companies, or joint ventures in which Encompass Health or one of its subsidiaries is a general or limited partner, managing member, member, or venturer, as applicable. We do not control these affiliates but have the ability to exercise significant influence over the operating and financial policies of certain of these affiliates. Our ownership percentages in these affiliates range from approximately 1% to 60% . We account for these investments using the cost and equity methods of accounting. Our investments, which are included in Other long-term assets in our consolidated balance sheets, consist of the following (in millions): As of December 31, 2017 2016 Equity method investments: Capital contributions $ 0.9 $ 0.9 Cumulative share of income 105.3 97.8 Cumulative share of distributions (94.5 ) (86.0 ) 11.7 12.7 Cost method investments: Capital contributions, net of distributions and impairments 0.2 0.3 Total investments in and advances to nonconsolidated affiliates $ 11.9 $ 13.0 The following summarizes the combined assets, liabilities, and equity and the combined results of operations of our equity method affiliates (on a 100% basis, in millions): As of December 31, 2017 2016 Assets— Current $ 10.1 $ 13.1 Noncurrent 18.3 19.2 Total assets $ 28.4 $ 32.3 Liabilities and equity— Current liabilities $ 2.7 $ 2.7 Noncurrent liabilities 0.2 0.2 Partners’ capital and shareholders’ equity— Encompass Health 11.7 12.7 Outside partners 13.8 16.7 Total liabilities and equity $ 28.4 $ 32.3 Condensed statements of operations (in millions): For the Year Ended December 31, 2017 2016 2015 Net operating revenues $ 40.9 $ 44.8 $ 36.5 Operating expenses (24.1 ) (24.3 ) (16.9 ) Income from continuing operations, net of tax 17.0 20.5 18.9 Net income 17.0 20.5 18.9 |
Long-term Debt
Long-term Debt | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Long-term Debt : Our long-term debt outstanding consists of the following (in millions): As of December 31, 2017 2016 Credit Agreement— Advances under revolving credit facility $ 95.0 $ 152.0 Term loan facilities 294.7 421.2 Bonds payable— 5.125% Senior Notes due 2023 295.9 295.3 5.75% Senior Notes due 2024 1,193.9 1,193.2 5.75% Senior Notes due 2025 344.4 343.9 2.00% Convertible Senior Subordinated Notes due 2043 — 275.7 Other notes payable 82.3 55.8 Capital lease obligations 271.5 279.3 2,577.7 3,016.4 Less: Current portion (32.3 ) (37.1 ) Long-term debt, net of current portion $ 2,545.4 $ 2,979.3 The following chart shows scheduled principal payments due on long-term debt for the next five years and thereafter (in millions): Year Ending December 31, Face Amount Net Amount 2018 $ 32.3 $ 32.3 2019 32.3 32.2 2020 25.2 25.2 2021 25.8 25.8 2022 356.1 354.5 Thereafter 2,123.4 2,107.7 Total $ 2,595.1 $ 2,577.7 As a result of the 2017 , 2016 , and 2015 redemptions discussed below, we recorded a $10.7 million , $7.4 million , and $22.4 million Loss on early extinguishment of debt in 2017 , 2016 , and 2015 , respectively. Senior Secured Credit Agreement— Credit Agreement In September 2017, we amended our existing credit agreement, previously amended on July 29, 2015 (the “Credit Agreement”). The Credit Agreement provided for a $300 million term loan commitment and a $700 million revolving credit facility, with a $260 million letter of credit subfacility and a swingline loan subfacility, all of which mature in September 2022. Outstanding term loan borrowings are payable in equal consecutive quarterly installments, commencing on December 31, 2017, of 1.25% of the aggregate principal amount of the term loans outstanding as of December 31, 2017, with the remainder due at maturity. We have the right at any time to prepay, in whole or in part, any borrowing under the term loan facilities. Amounts drawn on the term loan facilities and the revolving credit facility bear interest at a rate per annum of, at our option, (1) LIBOR or (2) the higher of (a) Barclays Bank PLC’s (“Barclays”) prime rate and (b) the federal funds rate plus 0.5% , in each case, plus, in each case, an applicable margin that varies depending upon our leverage ratio. We are also subject to a commitment fee of 0.375% per annum on the daily amount of the unutilized commitments under the term loan facilities and revolving credit facility. The current interest rate on borrowings under the Credit Agreement is LIBOR plus 1.50% . The Credit Agreement contains affirmative and negative covenants and default and acceleration provisions, including a minimum interest coverage ratio and a maximum leverage ratio that change over time. Under one such negative covenant, we are restricted from paying common stock dividends, prepaying certain senior notes, making certain investments, and repurchasing preferred and common equity unless (1) we are not in default under the terms of the Credit Agreement and (2) our senior secured leverage ratio, as defined in the Credit Agreement, does not exceed 2x . In the event the senior secured leverage ratio exceeds 2x, these payments are subject to a limit of $200 million plus an amount equal to a portion of available excess cash flows each fiscal year. Our obligations under the Credit Agreement are secured by the current and future personal property of the Company and its subsidiary guarantors. The maximum leverage ratio in the financial covenants is 4.50x through September 2019 and 4.25x from then until maturity. As of December 31, 2017 and 2016 , $95 million and $152 million were drawn under the revolving credit facility with an interest rate of 3.1% and 2.7% , respectively. Amounts drawn as of December 31, 2017 and 2016 exclude $35.4 million and $33.3 million , respectively, utilized under the letter of credit subfacility, which were being used in the ordinary course of business to secure workers’ compensation and other insurance coverages and for general corporate purposes. Currently, there are no undrawn term loan commitments under the Credit Agreement. The amendment to our existing credit agreement included a net repayment of approximately $110 million to our existing term loan facility. 2015 & 2016 Credit Agreement In June and July 2015, we amended our existing credit agreement, previously amended on December 23, 2014 (the “2015 & 2016 Credit Agreement”). The 2015 & 2016 Credit Agreement provided for $500 million of term loan commitments and a $600 million revolving credit facility, with a $260 million letter of credit subfacility and a swingline loan subfacility, all of which would have matured in July 2020. Outstanding term loan borrowings were payable in equal consecutive quarterly installments, commencing on March 31, 2016, of 1.25% of the aggregate principal amount of the term loans outstanding as of December 31, 2015, with the remainder due at maturity. The 2015 & 2016 Credit Agreement contained the same affirmative and negative covenants and default and acceleration provisions as the Credit Agreement, except for the senior secured leverage ratio couldn’t exceed 1.75x under the negative covenant described above and the maximum leverage ratio was 4.50x through June 2017 and 4.25x from then until maturity. In September 2015, we borrowed $125 million of the term loan facilities, the proceeds of which were used to fund a portion of the Reliant acquisition. In October 2015, we utilized the remaining $125 million of term loan facility capacity to finance a portion of the CareSouth acquisition. See Note 2, Business Combinations. Bonds Payable— Nonconvertible Notes The Company’s 2023 Notes, 2024 Notes, and 2025 Notes (collectively, the “Senior Notes”) were issued pursuant to an indenture (the “Base Indenture”) dated as of December 1, 2009 between us and The Bank of Nova Scotia Trust Company of New York, as trustee (the “Original Trustee”), as supplemented by each Senior Notes respective supplemental indenture (together with the Base Indenture, the “Indenture”), among us, the Subsidiary Guarantors (as defined in the Indenture), and the Original Trustee. The Original Trustee notified us of its intention to discontinue its corporate trust operations and, accordingly, to resign upon the appointment of a successor trustee. Effective July 29, 2013, Wells Fargo Bank, National Association, was appointed as successor trustee under the Indenture. Pursuant to the terms of the Indenture, the Senior Notes are jointly and severally guaranteed on a senior, unsecured basis by all of our existing and future subsidiaries that guarantee borrowings under our Credit Agreement and other capital markets debt (see Note 20, Condensed Consolidating Financial Information ). The Senior Notes are senior, unsecured obligations of Encompass Health and rank equally with our other senior indebtedness, senior to any of our subordinated indebtedness, and effectively junior to our secured indebtedness to the extent of the value of the collateral securing such indebtedness. Upon the occurrence of a change in control (as defined in the Indenture), each holder of the Senior Notes may require us to repurchase all or a portion of the notes in cash at a price equal to 101% of the principal amount of the Senior Notes to be repurchased, plus accrued and unpaid interest. The Senior Notes contain covenants and default and acceleration provisions, that, among other things, limit our and certain of our subsidiaries’ ability to (1) incur additional debt, (2) make certain restricted payments, (3) consummate specified asset sales, (4) incur liens, and (5) merge or consolidate with another person. 2023 Notes In March 2015, we issued $300 million of 5 .125% Senior Notes due 2023 (“the 2023 Notes”) at par, which resulted in approximately $295 million in net proceeds from the public offering. We used the net proceeds from this offering along with cash on hand to redeem all of our senior notes due 2020 outstanding at that time. Pursuant to the terms of these senior notes due 2020, this redemption was made at a price of 104.063% , which resulted in a total cash outlay of approximately $302 million to retire the $290 million in principal. The 2023 Notes mature on March 15, 2023 and bear interest at a per annum rate of 5.125% . Inclusive of financing costs, the effective interest rate on the 2023 Notes is 5.4% . Interest on the 2023 Notes is payable semiannually in arrears on March 15 and September 15, beginning on September 15, 2015. We may redeem the 2023 Notes, in whole or in part, at any time on or after March 15, 2018 at the redemption prices set forth below: Period Redemption Price* 2018 103.844 % 2019 102.563 % 2020 101.281 % 2021 and thereafter 100.000 % * Expressed in percentage of principal amount 2024 Notes In September 2012, we completed a public offering of $275 million aggregate principal amount of the 5.75% Senior Notes due 2024 (“the 2024 Notes”) at par. Net proceeds from this offering were approximately $270 million . We used $195 million of the net proceeds to repay the amounts outstanding under our revolving credit facility. Additionally, in October 2012, $64.5 million of the net proceeds were used to redeem a portion of our former senior notes due 2022 at that time. In September 2014, we issued an additional $175 million of the 2024 Notes at a price of 103.625% of the principal amount, which resulted in approximately $182 million in net proceeds from the public offering. In January 2015, we issued an additional $400 million of the 2024 Notes at a price of 102% of the principal amount, which resulted in approximately $406 million in net proceeds from the public offering. We used $250 million of the net proceeds to repay borrowings under our term loan facilities, with the remaining net proceeds used to repay borrowings under our revolving credit facility. In August 2015, we issued an additional $350 million of our 2024 Notes at a price of 100.5% of the principal amount, which resulted in approximately $351 million in net proceeds from the private offering. We used the net proceeds to reduce borrowings under our revolving credit facility and fund a portion of the Reliant acquisition, as discussed in Note 2, Business Combinations. The 2024 Notes mature on November 1, 2024 and bear interest at a per annum rate of 5.75% . Inclusive of premiums and financing costs, the effective interest rate on the 2024 Notes is 5.8% . Interest is payable semiannually in arrears on May 1 and November 1 of each year. We may redeem the 2024 Notes, in whole or in part, at any time on or after November 1, 2017, at the redemption prices set forth below: Period Redemption Price* 2017 102.875 % 2018 101.917 % 2019 100.958 % 2020 and thereafter 100.000 % * Expressed in percentage of principal amount 2025 Notes In September 2015, we issued $350 million of 5.75% Senior Notes due 2025 (“the 2025 Notes”) at par, which resulted in approximately $344 million in net proceeds from the private offering. We used the net proceeds from this borrowing to fund a portion of the Reliant acquisition. The 2025 Notes mature on September 15, 2025 and bear interest at a per annum rate of 5.75% . Inclusive of financing costs, the effective interest rate on the 2025 Notes is 6.0% . Interest on the 2025 Notes is payable semiannually in arrears on March 15 and September 15, beginning on March 15, 2016. We may redeem the 2025 Notes, in whole or in part, at any time on or after September 15, 2020, at the redemption prices set forth below: Period Redemption Price* 2020 102.875 % 2021 101.917 % 2022 100.958 % 2023 and thereafter 100.000 % * Expressed in percentage of principal amount Former 2022 Notes In November 2015, we redeemed $50.0 million of the outstanding principal amount of our former senior notes due 2022 (“the Former 2022 Notes”). Pursuant to the terms of the Former 2022 Notes, this optional redemption was made at a price of 103.875% , which resulted in a total cash outlay of approximately $52 million . We used borrowings under our revolving credit facility to fund the redemption. In March and May 2016, we redeemed $50.0 million of the outstanding principal amount of our Former 2022 Notes. Pursuant to the terms of the Former 2022 Notes, these optional redemptions were made at a price of 103.875% , which resulted in a total cash outlay of approximately $104 million . We used cash on hand and capacity under our revolving credit facility to fund these redemptions. In September 2016, we redeemed the remaining outstanding principal amount of $76 million of the Former 2022 Notes. Pursuant to the terms of these notes, these optional redemptions were made at a price of 102.583% , which resulted in a total cash outlay of approximately $78 million . We used cash on hand and capacity under our revolving credit facility to fund this redemption. The Former 2022 Notes would have matured on September 15, 2022. Inclusive of premiums and financing costs, the effective interest rate on the Former 2022 Notes was 7.9% . Interest was payable semiannually in arrears on March 15 and September 15 of each year. Convertible Notes Convertible Senior Subordinated Notes Due 2043 In November 2013, we exchanged $320 million in aggregate principal amount of newly issued 2.00% Convertible Senior Subordinated Notes due 2043 (the “Convertible Notes”) for 257,110 shares of our outstanding 6.50% Series A Convertible Perpetual Preferred Stock. The Company’s Convertible Notes were issued pursuant to an indenture dated November 18, 2013 (the “Convertible Notes Indenture”) between us and Wells Fargo Bank, National Association, as trustee and conversion agent. In May 2017, we provided notice of our intent to exercise our early redemption option on the $320 million outstanding principal amount of the Convertible Notes. Pursuant to the Convertible Notes Indenture, the holders had the right to convert their Convertible Notes into shares of our common stock at a conversion rate of 27.2221 shares per $1,000 principal amount of Convertible Notes, which rate was increased by the make-whole premium. Holders of $319.4 million in principal of these Convertible Notes chose to convert their notes to shares of our common stock resulting in the issuance of 8.9 million shares from treasury stock, including 0.2 million shares due to the make-whole premium. Approximately 8.6 million of these shares were included in Diluted earnings per share attributable to Encompass Health common shareholders as of March 31, 2017 . We redeemed the remaining $0.6 million in principal at par in cash. The redemption and all conversions occurred in the second quarter of 2017. The Convertible Notes would have matured on December 1, 2043. Inclusive of discounts and financing costs, the effective interest rate on the Convertible Notes was 6.0% . Interest was payable semiannually in arrears in cash on June 1 and December 1 of each year. See also Note 16, Earnings per Common Share for additional information on these Convertible Notes. Other Notes Payable— Our notes payable consist of the following (in millions): As of December 31, 2017 2016 Interest Rates Sale/leaseback transactions involving real estate accounted for as financings $ 77.7 $ 48.2 7.5% to 11.2% Construction of a new hospital 4.4 7.4 LIBOR + 2.5%; Other 0.2 0.2 6.8% Other notes payable $ 82.3 $ 55.8 See also Note 6, Property and Equipment . Capital Lease Obligations— We engage in a significant number of leasing transactions including real estate and other equipment utilized in operations. Leases meeting certain accounting criteria have been recorded as an asset and liability at the lower of fair value or the net present value of the aggregate future minimum lease payments at the inception of the lease. Interest rates used in computing the net present value of the lease payments generally ranged from 2% to 11% based on our incremental borrowing rate at the inception of the lease. Our leasing transactions include arrangements for vehicles with major finance companies and manufacturers who retain ownership in the equipment during the term of the lease and with a variety of both small and large real estate owners. |
Self-Insured Risks
Self-Insured Risks | 12 Months Ended |
Dec. 31, 2017 | |
Insurance [Abstract] | |
Self-Insured Risks | Self-Insured Risks : We insure a substantial portion of our professional liability, general liability, and workers’ compensation risks through a self-insured retention program (“SIR”) underwritten by our consolidated wholly owned offshore captive insurance subsidiary, HCS, Ltd., which we fund via regularly scheduled premium payments. HCS is an insurance company licensed by the Cayman Island Monetary Authority. We use HCS to fund our first layer of insurance coverage up to approximately $28 million for annual aggregate losses associated with general and professional liability risks. Workers’ compensation exposures are capped on a per claim basis. Risks in excess of specified limits per claim and in excess of our aggregate SIR amount are covered by unrelated commercial carriers. The following table presents the changes in our self-insurance reserves for the years ended December 31, 2017 , 2016 , and 2015 (in millions): 2017 2016 2015 Balance at beginning of period, gross $ 171.4 $ 142.1 $ 134.3 Less: Reinsurance receivables (41.4 ) (26.6 ) (26.0 ) Balance at beginning of period, net 130.0 115.5 108.3 Increase for the provision of current year claims 44.7 43.5 37.1 Decrease for the provision of prior year claims (3.0 ) (0.1 ) (4.6 ) Expenses related to discontinued operations (0.5 ) (0.4 ) (0.5 ) Payments related to current year claims (5.0 ) (5.0 ) (4.7 ) Payments related to prior year claims (35.1 ) (23.5 ) (22.5 ) Acquisitions — — 2.4 Balance at end of period, net 131.1 130.0 115.5 Add: Reinsurance receivables 39.9 41.4 26.6 Balance at end of period, gross $ 171.0 $ 171.4 $ 142.1 As of December 31, 2017 and 2016 , $60.9 million and $61.0 million , respectively, of these reserves are included in Other current liabilities in our consolidated balance sheets. Provisions for these risks are based primarily upon actuarially determined estimates. These reserves represent the unpaid portion of the estimated ultimate cost of all reported and unreported losses incurred through the respective consolidated balance sheet dates. The reserves are estimated using individual case-basis valuations and actuarial analyses. Those estimates are subject to the effects of trends in loss severity and frequency. The estimates are continually reviewed and adjustments are recorded as experience develops or new information becomes known. The changes to the estimated ultimate loss amounts are included in current operating results. The reserves for these self-insured risks cover approximately 1,000 individual claims at December 31, 2017 and 2016 , and estimates for potential unreported claims. The time period required to resolve these claims can vary depending upon the jurisdiction, the nature, and the form of resolution of the claims. The estimation of the timing of payments beyond a year can vary significantly. Although considerable variability is inherent in reserve estimates, management believes the reserves for losses and loss expenses are adequate; however, there can be no assurance the ultimate liability will not exceed management’s estimates. |
Redeemable Noncontrolling Inter
Redeemable Noncontrolling Interests | 12 Months Ended |
Dec. 31, 2017 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontolling Interests | Redeemable Noncontrolling Interests : The following is a summary of the activity related to our Redeemable noncontrolling interests (in millions): For the Year Ended December 31, 2017 2016 2015 Balance at beginning of period $ 138.3 $ 121.1 $ 84.7 Net income attributable to noncontrolling interests 17.9 14.1 13.8 Distributions (4.6 ) (7.8 ) (7.3 ) Contribution to joint venture 2.3 — — Change in fair value 67.0 10.9 29.9 Balance at end of period $ 220.9 $ 138.3 $ 121.1 The following table reconciles the net income attributable to nonredeemable Noncontrolling interests , as recorded in the shareholders’ equity section of the consolidated balance sheets, and the net income attributable to Redeemable noncontrolling interests , as recorded in the mezzanine section of the consolidated balance sheets, to the Net income attributable to noncontrolling interests presented on the consolidated statements of operations (in millions): For the Year Ended December 31, 2017 2016 2015 Net income attributable to nonredeemable noncontrolling interests $ 61.2 $ 56.4 $ 55.9 Net income attributable to redeemable noncontrolling interests 17.9 14.1 13.8 Net income attributable to noncontrolling interests $ 79.1 $ 70.5 $ 69.7 On December 31, 2014, we acquired 83.3% of our home health and hospice business when we purchased EHHI Holdings, Inc. (“EHHI”). In the acquisition, we acquired all of the issued and outstanding equity interests of EHHI, other than equity interests contributed to Encompass Health Home Health Holdings, Inc. (“Holdings”), a subsidiary of Encompass Health and an indirect parent of EHHI, by certain sellers in exchange for shares of common stock of Holdings. Those sellers were members of EHHI management, and they contributed a portion of their shares of common stock of EHHI, valued at approximately $64 million on the acquisition date, in exchange for approximately 16.7% of the outstanding shares of common stock of Holdings. At any time after December 31, 2017, each management investor has the right (but not the obligation) to have his or her shares of Holdings stock repurchased by Encompass Health for a cash purchase price per share equal to the fair value. Specifically, up to one-third of each management investor’s shares of Holdings stock may be sold prior to December 31, 2018; two-thirds of each management investor’s shares of Holdings stock may be sold prior to December 31, 2019; and all of each management investor’s shares of Holdings stock may be sold thereafter. At any time after December 31, 2019, Encompass Health will have the right (but not the obligation) to repurchase all or any portion of the shares of Holdings stock owned by one or more management investors for a cash purchase price per share equal to the fair value. As of December 31, 2017 , the value of those outstanding shares of Holdings was approximately $192 million . In February 2018, each management investor exercised the right to sell one-third of his or her shares of Holdings stock to Encompass Health, representing approximately 5.6% of the outstanding shares of the common stock of Holdings. On February 21, 2018, Encompass Health settled the acquisition of those shares upon payment of approximately $65 million in cash. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements : Our financial assets and liabilities that are measured at fair value on a recurring basis are as follows (in millions): Fair Value Measurements at Reporting Date Using As of December 31, 2017 Fair Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Valuation Technique (1) Prepaid expenses and other current assets: Current portion of restricted marketable securities $ 17.8 $ — $ 17.8 $ — M Other long-term assets: Restricted marketable securities 44.2 — 44.2 — M Redeemable noncontrolling interests 220.9 — — 220.9 I As of December 31, 2016 Prepaid expenses and other current assets: Current portion of restricted marketable securities $ 24.2 $ — $ 24.2 $ — M Other long-term assets: Restricted marketable securities 33.5 — 33.5 — M Redeemable noncontrolling interests 138.3 — — 138.3 I (1) The three valuation techniques are: market approach (M), cost approach (C), and income approach (I). In addition to assets and liabilities recorded at fair value on a recurring basis, we are also required to record assets and liabilities at fair value on a nonrecurring basis. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges or similar adjustments made to the carrying value of the applicable assets. During the years ended December 31, 2017 , 2016 , and 2015 , we did not record any gains or losses related to our nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a nonrecurring basis as part of our continuing operations. As discussed in Note 1, Summary of Significant Accounting Policies , “Fair Value Measurements,” the carrying value equals fair value for our financial instruments that are not included in the table below and are classified as current in our consolidated balance sheets. The carrying amounts and estimated fair values for our other financial instruments are presented in the following table (in millions): As of December 31, 2017 As of December 31, 2016 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Long-term debt: Advances under revolving credit facility $ 95.0 $ 95.0 $ 152.0 $ 152.0 Term loan facilities 294.7 296.3 421.2 422.5 5.125% Senior Notes due 2023 295.9 306.8 295.3 297.8 5.75% Senior Notes due 2024 1,193.9 1,228.5 1,193.2 1,216.6 5.75% Senior Notes due 2025 344.4 364.9 343.9 349.6 2.00% Convertible Senior Subordinated Notes due 2043 — — 275.7 382.6 Other notes payable 82.3 82.3 55.8 55.8 Financial commitments: Letters of credit — 35.4 — 33.3 Fair values for our long-term debt and financial commitments are determined using inputs, including quoted prices in nonactive markets, that are observable either directly or indirectly, or Level 2 inputs within the fair value hierarchy. See Note 1, Summary of Significant Accounting Policies , “Fair Value Measurements” and “Redeemable Noncontrolling Interests.” |
Share-Based Payments
Share-Based Payments | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Payments | Share-Based Payments : The Company has awarded employee stock-based compensation in the form of stock options, SARs, and restricted stock awards (“RSAs”) under the terms of share-based incentive plans designed to align employee and executive interests to those of its stockholders. All employee stock-based compensation awarded between January 1, 2015 and May 8, 2016 was issued under the Amended and Restated 2008 Equity Incentive Plan (the “2008 Plan”), a stockholder-approved plan that reserved and provided for the grant of up to nine million shares of common stock. This plan allowed the grants of nonqualified stock options, incentive stock options, restricted stock, SARs, performance shares, performance share units, dividend equivalents, restricted stock units (“RSUs”), and/or other stock-based awards. No additional stock-based compensation was or will be issued from the 2008 Plan. In May 2016, our stockholders approved the 2016 Omnibus Performance Incentive Plan, which reserves and provides for the grant of up to 14,000,000 shares of common stock. All employee stock-based compensation awarded after May 8, 2016 was issued under this plan. This plan allows for the same types of equity grants as the 2008 Plan. Stock Options— Under our share-based incentive plans, officers and employees are given the right to purchase shares of Encompass Health common stock at a fixed grant price determined on the day the options are granted. The terms and conditions of the options, including exercise prices and the periods in which options are exercisable, are generally at the discretion of the compensation committee of our board of directors. However, no options are exercisable beyond ten years from the date of grant. Granted options vest over the awards’ requisite service periods, which are generally three years . The fair values of the options granted during the years ended December 31, 2017 , 2016 , and 2015 have been estimated at the grant date using the Black-Scholes option-pricing model with the following weighted-average assumptions: For the Year Ended December 31, 2017 2016 2015 Expected volatility 30.5 % 37.2 % 39.5 % Risk-free interest rate 2.1 % 1.6 % 1.9 % Expected life (years) 7.7 7.5 7.7 Dividend yield 2.2 % 2.1 % 2.1 % The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options which have no vesting restrictions and are fully transferable. In addition, the Black-Scholes option-pricing model requires the input of highly subjective assumptions, including the expected stock price volatility. We estimate our expected term through an analysis of actual, historical post-vesting exercise, cancellation, and expiration behavior by our employees and projected post-vesting activity of outstanding options. We calculate volatility based on the historical volatility of our common stock over the period commensurate with the expected term of the options. The risk-free interest rate is the implied daily yield currently available on U.S. Treasury issues with a remaining term closely approximating the expected term used as the input to the Black-Scholes option-pricing model. We estimated our dividend yield based on our annual dividend rate and our stock price on the dividend payment dates. Under the Black-Scholes option-pricing model, the weighted-average grant date fair value per share of employee stock options granted during the years ended December 31, 2017 , 2016 , and 2015 was $11.55 , $11.55 , and $15.11 , respectively. A summary of our stock option activity and related information is as follows: Shares (In Thousands) Weighted- Average Exercise Price per Share Weighted- Average Remaining Life (Years) Aggregate Intrinsic Value (In Millions) Outstanding, December 31, 2016 1,575 $ 21.45 Granted 95 42.22 Exercised (1,107 ) 18.58 Forfeitures (3 ) 43.14 Expirations (3 ) 23.19 Outstanding, December 31, 2017 557 30.53 6.0 $ 10.5 Exercisable, December 31, 2017 377 25.81 4.6 8.9 We recognized approximatel y $0.8 million , $1.6 million , and $1.6 million of compensation expense related to our stock options for the years ended December 31, 2017 , 2016 , and 2015 , respectively. As of December 31, 2017 , there was $1.3 million o f unrecognized compensation cost related to unvested stock options. This cost is expected to be recognized over a weighted-average period of 23 months. The total intrinsic value of options exercised during the years ended December 31, 2017 , 2016 , and 2015 was $29.0 million , $9.1 million , and $4.2 million , respectively. Stock Appreciation Rights— In conjunction with the EHHI acquisition, we granted SARs based on Encompass Health Home Health Holdings, Inc. (“Holdings”) common stock to certain members of EHHI management at closing on December 31, 2014. Under a separate plan, we granted 122,976 SARs that vest based on continued employment and an additional maximum number of 129,124 SARs that vest based on continued employment and the extent of the attainment of a specified 2017 performance measure. The maximum number of performance SARs was achieved. In general terms, half of the SARs of each type will vest on December 31, 2018 with the remainder vesting on December 31, 2019. The SARs that ultimately vest will expire on the tenth anniversary of the grant date or within a specified period following any earlier termination of employment. Upon exercise, each SAR must be settled for cash in the amount by which the per share fair value of Holdings’ common stock on the exercise date exceeds the per share fair value on the grant date. The fair value of Holdings’ common stock is determined using the product of the trailing 12-month specified performance measure for Holdings and a specified median market price multiple based on a basket of public home health companies. The fair value of the SARs granted in conjunction with the EHHI acquisition has been estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions: For the Year Ended December 31, 2017 2016 Expected volatility 28.7 % 25.9 % Risk-free interest rate 1.9 % 1.9 % Expected life (years) 2.1 5.3 Dividend yield — % — % We did not include a dividend payment as part of our pricing model because Holdings currently does not pay dividends on its common stock. Under the Black-Scholes option-pricing model, the weighted-average fair value per share of SARs granted in conjunction with the EHHI acquisition was $199.41 and $84.33 as of December 31, 2017 and 2016 , respectively. We recognized approximately $26.0 million , $5.8 million , and $3.5 million of compensation expense related to our SARs for the years ended December 31, 2017 , 2016 and 2015 , respectively. As of December 31, 2017 , there was $15.0 million of unrecognized compensation cost related to unvested SARs. This cost is expected to be recognized over a weighted-average period of 27 months . The remaining unrecognized compensation expense for our SARs may vary each reporting period based on changes in both operational performance and the specified median market multiple. As of December 31, 2017 , 252,100 SARs were outstanding. Restricted Stock— The RSAs granted in 2017 , 2016 , and 2015 included service-based awards, performance-based awards (that also included a service requirement), and (in 2015) market condition awards (that also included a service requirement). These awards generally vest over a three-year requisite service period. For RSAs with a service and/or performance requirement, the fair value of the RSA is determined by the closing price of our common stock on the grant date. For RSAs with a market condition, the fair value of the RSA is determined using a lattice model. Inputs into the model include the historical price volatility of our common stock, the historical volatility of the common stock of the companies in the defined peer group, and the risk-free interest rate. Utilizing these inputs and potential future changes in stock prices, multiple trials are run to determine the fair value. A summary of our issued restricted stock awards is as follows (share information in thousands): Shares Weighted-Average Grant Date Fair Value Nonvested shares at December 31, 2016 618 $ 35.06 Granted 504 42.85 Vested (427 ) 34.83 Forfeited (22 ) 39.22 Nonvested shares at December 31, 2017 673 40.90 The weighted-average grant date fair value of restricted stock granted during the years ended December 31, 2016 and 2015 was $33.56 and $27.86 per share, respectively. We recognized approximate ly $19.6 million , $18.7 million , and $19.5 million of compensation expense related to our restricted stock awards for the years ended December 31, 2017 , 2016 , and 2015 , respectively. As of December 31, 2017 , there was $24.0 million of unrecognized compensation expense related to unvested restricted stock. This cost is expected to be recognized over a weighted-average period of 21 months. T he remaining unrecognized compensation expense for the performance-based awards may vary each reporting period based on changes in the expected achievement of performance measures. The total fair value of shares vested during the years ended December 31, 2017 , 2016 , and 2015 wa s $17.7 million , $24.3 million , and $41.0 million , respectively. We accrue dividends on outstanding RSAs which are paid upon vesting. Nonemployee Stock-Based Compensation Plans— During the years ended December 31, 2017 , 2016 , and 2015 , we provided incentives to our nonemployee members of our board of directors through the issuance of RSUs out of our share-based incentive plans. RSUs are fully vested when awarded and receive dividend equivalents in the form of additional RSUs upon the payment of a cash dividend on our common stock. During the years ended December 31, 2017 , 2016 , and 2015 , we issued 27,594 , 32,031 , and 30,744 RSUs, respectively, with a fair value of $47.30 , $40.75 , and $42.46 , respectively, per unit. We recognized approximately $1.3 million , $1.3 million , and $1.3 million , respectively, of compensation expense upon their issuance in 2017 , 2016 , and 2015 . There was no unrecognized compensation related to unvested shares as of December 31, 2017 . During the years ended December 31, 2017 , 2016 , and 2015 , we issued an a dditional 9,968 , 10,248 , and 7,645 , respectively, of RSUs as dividend equivalents. As of December 31, 2017 , 471,696 RSUs were ou tstanding. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans : Substantially all Encompass Health hospital employees are eligible to enroll in Encompass Health-sponsored healthcare plans, including coverage for medical and dental benefits. Our primary healthcare plans are national plans administered by third-party administrators. We are self-insured for these plans. During 2017 , 2016 , and 2015 , costs associated with these plans, net of amounts paid by employees, approximated $120.8 million , $119.0 million , and $109.3 million , respectively. The Encompass Health Retirement Investment Plan is a qualified 401(k) savings plan. The plan allows eligible employees to contribute up to 100% of their pay on a pre-tax basis into their individual retirement account in the plan subject to the normal maximum limits set annually by the Internal Revenue Service. Encompass Health’s employer matching contribution is 50% of the first 6% of each participant’s elective deferrals . All contributions to the plan are in the form of cash. Employees who are at least 21 years of age are eligible to participate in the plan. Employer contributions vest 100% after three years of service. Participants are always fully vested in their own contributions. Employer contributions to the Encompass Health Retirement Investment Plan approximated $18.2 million , $16.6 million , and $15.0 million in 2017 , 2016 , and 2015 , respectively. In 2017 , 2016 , and 2015 , approximately $1.4 million , $0.6 million , and $0.9 million , respectively, from the plan’s forfeiture account were used to fund the matching contributions in accordance with the terms of the plan. Senior Management Bonus Program— We maintain a Senior Management Bonus Program to reward senior management for performance based on a combination of corporate or regional goals and individual goals. The corporate and regional goals are approved on an annual basis by our board of directors as part of our routine budgeting and financial planning process. The individual goals, which are weighted according to importance, are determined between each participant and his or her immediate supervisor. The program applies to persons who join the Company in, or are promoted to, senior management positions. In 2018 , we expect to pay approximately $15.1 million under the program for the year ended December 31, 2017 . In February 2017 and 2016 , we paid $11.2 million and $9.4 million , respectively, under the program for the years ended December 31, 2016 and 2015 . |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes : On December 22, 2017, the US enacted the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act, which is commonly referred to as “US tax reform,” significantly changes US corporate income tax laws by, among other things, reducing the US corporate income tax rate from 35% to 21% starting in 2018. As a result, we recorded a net charge of $1.2 million during the fourth quarter of 2017. This amount, which is included in Provision for income tax expense in the consolidated statement of operations, consists of three components: (i) a $10.1 million charge resulting from the remeasurement of our net federal deferred tax assets based on the new lower corporate income tax rate, (ii) a $14.7 million credit resulting from the remeasurement of our net state deferred tax assets as a result of the decreased federal benefit implicit in the new lower corporate income tax rate, and (iii) a $5.8 million charge resulting from the remeasurement of our net valuation allowances for state NOLs as a result of the decreased federal benefit implicit in the new lower corporate income tax rate. The net charge of $1.2 million did not have a material impact on our effective tax rate. In addition, we adopted the Tax Act’s provisions allowing for 100% bonus depreciation on qualifying assets placed in service after September 27, 2017, which resulted in additional bonus depreciation deductions of $8.8 million in the fourth quarter of 2017. The significant components of the Provision for income tax expense related to continuing operations are as follows (in millions): For the Year Ended December 31, 2017 2016 2015 Current: Federal $ 72.2 $ 16.1 $ 2.6 State and other 12.8 14.9 12.2 Total current expense 85.0 31.0 14.8 Deferred: Federal 74.2 130.5 113.9 State and other 1.4 2.4 13.2 Total deferred expense 75.6 132.9 127.1 Total income tax expense related to continuing operations $ 160.6 $ 163.9 $ 141.9 A reconciliation of differences between the federal income tax at statutory rates and our actual income tax expense on our income from continuing operations, which include federal, state, and other income taxes, is presented below: For the Year Ended December 31, 2017 2016 2015 Tax expense at statutory rate 35.0 % 35.0 % 35.0 % Increase (decrease) in tax rate resulting from: State and other income taxes, net of federal tax benefit 3.5 % 3.8 % 3.6 % Increase in valuation allowance 0.4 % 0.1 % 1.2 % Noncontrolling interests (4.6 )% (4.4 )% (5.3 )% Share-based windfall tax benefits (1.8 )% — % — % Other, net (0.1 )% (0.5 )% 1.4 % Income tax expense 32.4 % 34.0 % 35.9 % The Provision for income tax expense in 2017 was less than the federal statutory rate primarily due to: (1) the impact of noncontrolling interests and (2) share-based windfall tax benefits offset by (3) state and other income tax expense. See Note 1, Summary of Significant Accounting Policies , “Income Taxes,” for a discussion of the allocation of income or loss related to pass-through entities, which is referred to as the impact of noncontrolling interests in this discussion. The Provision for income tax expense in 2016 was less than the federal statutory rate primarily due to: (1) the impact of noncontrolling interests offset by (2) state and other income tax expense. The Provision for income tax expense in 2015 was greater than the federal statutory rate primarily due to: (1) state and other income tax expense and (2) an increase in our valuation allowance offset by (3) the impact of noncontrolling interests. The increase in our valuation allowance in 2015 related primarily to changes to our state apportionment percentages resulting from the acquisitions of EHHI, Reliant, and CareSouth and changes to our current forecast of earnings in each jurisdiction. Deferred income taxes recognize the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and amounts used for income tax purposes and the impact of available NOLs. The significant components of our deferred tax assets and liabilities are presented in the following table (in millions): As of December 31, 2017 2016 Deferred income tax assets: Net operating loss $ 77.3 $ 64.8 Property, net 36.3 52.1 Insurance reserve 19.9 32.0 Stock-based compensation 19.5 23.7 Allowance for doubtful accounts 14.0 19.3 Alternative minimum tax — 7.5 Carrying value of partnerships — 12.9 Other accruals 20.4 26.1 Tax credits 2.8 2.6 Noncontrolling interest 26.3 14.8 Other 0.5 0.8 Total deferred income tax assets 217.0 256.6 Less: Valuation allowance (35.8 ) (27.9 ) Net deferred income tax assets 181.2 228.7 Deferred income tax liabilities: Deferred revenue (28.9 ) — Intangibles (80.0 ) (113.2 ) Convertible debt interest — (38.1 ) Carrying value of partnerships (6.2 ) — Other (2.5 ) (1.6 ) Total deferred income tax liabilities (117.6 ) (152.9 ) Net deferred income tax assets $ 63.6 $ 75.8 In the consolidated statements of shareholders’ equity, the fair value adjustments to redeemable noncontrolling interests have been reported net of tax for each period presented. The amount of tax benefit allocated to Capital in excess of par value was ($25.1) million , ($4.2) million , and $(11.7) million for the years ended December 31, 2017 , 2016 , and 2015 , respectively. We have state NOLs of $77.3 million that expire in various amounts at varying times through 2031. For the years ended December 31, 2017 , 2016 , and 2015 , the net changes in our valuation allowance were $7.9 million , $0.3 million , and $4.6 million , respectively. The increase in our valuation allowance in 2017 related primarily to the impact of remeasuring our state NOL deferred tax assets and their corresponding valuation allowances pursuant to the Tax Act. The increase in our valuation allowance in 2016 related primarily to the valuation of our tax credits. The increase in our valuation allowance in 2015 related primarily to changes to our state apportionment percentages resulting from the acquisitions of EHHI, Reliant, and CareSouth and changes to our current forecast of earnings in each jurisdiction. As of December 31, 2017 , we have a remaining valuation allowance of $35.8 million . This valuation allowance remains recorded due to uncertainties regarding our ability to utilize a portion of our state NOLs and other credits before they expire. The amount of the valuation allowance has been determined for each tax jurisdiction based on the weight of all available evidence including management’s estimates of taxable income for each jurisdiction in which we operate over the periods in which the related deferred tax assets will be recoverable. It is possible we may be required to increase or decrease our valuation allowance at some future time if our forecast of future earnings varies from actual results on a consolidated basis or in the applicable state tax jurisdictions, or if the timing of future tax deductions or credit utilizations differs from our expectations. During the third quarter of 2016, we filed a non-automatic tax accounting method change related to billings denied under pre-payment claims reviews conducted by certain of our Medicare Administrative Contractors. In March 2017, the IRS approved our request resulting in additional cash tax benefits of approximately $51.3 million through December 31, 2017. Approximately $39 million of this amount represents pre-payment claims denials received in years prior to and including the year ended December 31, 2015. These benefits are expected to reverse as pre-payment claims denials are settled and collected. This change did not have a material impact on our effective tax rate. The Tax Act included revisions to Internal Revenue Code §451 that may eliminate this deferral of revenue for tax purposes and require us to pay tax on such denied claims. We are currently evaluating this provision of the Tax Act and its future impact on the method change we received in March 2017. As of January 1, 2015 , total remaining gross unrecognized tax benefits were $0.9 million , all of which would have affected our effective tax rate if recognized. The amount of unrecognized tax benefits did not change significantly during 2015 . Total remaining gross unrecognized tax benefits were $2.9 million as of December 31, 2015 , all of which would have affected our effective tax rate if recognized. The amount of unrecognized tax benefits did not change significantly during 2016 . Total remaining gross unrecognized tax benefits were $2.8 million as of December 31, 2016 , all of which would have affected our effective tax rate if recognized. The amount of unrecognized tax benefits decreased $2.5 million during 2017 , primarily related to the favorable settlement of a federal interest claim. Total remaining gross unrecognized tax benefits were $0.3 million as of December 31, 2017 , all of which would affect our effective tax rate if recognized. A reconciliation of the beginning and ending liability for unrecognized tax benefits is as follows (in millions): Gross Unrecognized Income Tax Benefits Accrued Interest and Penalties January 1, 2015 $ 0.9 $ — Gross amount of increases in unrecognized tax benefits related to prior periods 1.7 — Gross amount of increases in unrecognized tax benefits related to current period 0.3 — December 31, 2015 2.9 — Gross amount of increases in unrecognized tax benefits related to prior periods 0.3 — Gross amount of decreases in unrecognized tax benefits related to prior periods (0.4 ) — Gross amount of increases in unrecognized tax benefits related to current period 0.1 — Gross amount of decreases in unrecognized tax benefits related to current period (0.1 ) — December 31, 2016 2.8 — Gross amount of decreases in unrecognized tax benefits related to prior periods (0.4 ) — Decreases in unrecognized tax benefits relating to settlements with taxing authorities (2.1 ) — December 31, 2017 $ 0.3 $ — Our continuing practice is to recognize interest and penalties related to income tax matters in income tax expense. Interest recorded as part of our income tax provision during 2017 , 2016 , and 2015 was not material. Accrued interest income related to income taxes as of December 31, 2017 and 2016 was not material. In December 2014, we signed an agreement with the IRS to begin participating in their Compliance Assurance Process, a program in which we and the IRS endeavor to agree on the treatment of significant tax positions prior to the filing of our federal income tax return. We renewed this agreement in December 2015 for the 2016 tax year, in December 2016 for the 2017 tax year, and in January 2018 for the 2018 tax year. As a result of these agreements, the IRS surveyed our 2013, 2012, and 2011 federal income tax returns and is currently examinin g 2016, 2017, and 2018 tax years. Our 2014 federal income tax return has been filed, and the IRS has not indicated its intent to examine or survey this return. In February 2017, the IRS issued a no-change Revenue Agent’s Report effectively closing our 2015 tax audit. We have settled federal income tax examinations with the IRS for all tax years throu gh 2013 as well as 2015. Our state income tax returns are also periodically examined by various regulatory taxing authorities. We are currently under audit by two states for tax years ranging from 2012 through 2015. For the tax years that remain open under the applicable statutes of limitations, amounts related to unrecognized tax benefits have been considered by management in its estimate of our potential net recovery of prior years’ income taxes. Based on discussions with taxing authorities, we anticipate none of our unrecognized tax benefits will be released within the next 12 months. See also Note 1, Summary of Significant Accounting Policies , “Recent Accounting Pronouncements.” |
Earnings per Common Share
Earnings per Common Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings per Common Share | Earnings per Common Share : The following table sets forth the computation of basic and diluted earnings per common share (in millions, except per share amounts): For the Year Ended December 31, 2017 2016 2015 Basic: Numerator: Income from continuing operations $ 335.8 $ 318.1 $ 253.7 Less: Net income attributable to noncontrolling interests included in continuing operations (79.1 ) (70.5 ) (69.7 ) Less: Income allocated to participating securities (0.8 ) (0.8 ) (1.0 ) Less: Convertible perpetual preferred stock dividends — — (1.6 ) Income from continuing operations attributable to Encompass Health common shareholders 255.9 246.8 181.4 Loss from discontinued operations, net of tax, attributable to Encompass Health common shareholders (0.4 ) — (0.9 ) Net income attributable to Encompass Health common shareholders $ 255.5 $ 246.8 $ 180.5 Denominator: Basic weighted average common shares outstanding 93.7 89.1 89.4 Basic earnings per share attributable to Encompass Health common shareholders: Continuing operations $ 2.73 $ 2.77 $ 2.03 Discontinued operations — — (0.01 ) Net income $ 2.73 $ 2.77 $ 2.02 Diluted: Numerator: Income from continuing operations $ 335.8 $ 318.1 $ 253.7 Less: Net income attributable to noncontrolling interests included in continuing operations (79.1 ) (70.5 ) (69.7 ) Add: Interest on convertible debt, net of tax 4.6 9.7 9.4 Add: Loss on extinguishment of convertible debt, net of tax 6.2 — — Income from continuing operations attributable to Encompass Health common shareholders 267.5 257.3 193.4 Loss from discontinued operations, net of tax, attributable to Encompass Health common shareholders (0.4 ) — (0.9 ) Net income attributable to Encompass Health common shareholders $ 267.1 $ 257.3 $ 192.5 Denominator: Diluted weighted average common shares outstanding 99.3 99.5 101.0 Diluted earnings per share attributable to Encompass Health common shareholders: Continuing operations $ 2.69 $ 2.59 $ 1.92 Discontinued operations — — (0.01 ) Net income $ 2.69 $ 2.59 $ 1.91 The following table sets forth the reconciliation between basic weighted average common shares outstanding and diluted weighted average common shares outstanding (in millions): For the Year Ended December 31, 2017 2016 2015 Basic weighted average common shares outstanding 93.7 89.1 89.4 Convertible perpetual preferred stock — — 1.0 Convertible senior subordinated notes 4.0 8.5 8.3 Restricted stock awards, dilutive stock options, and restricted stock units 1.6 1.9 2.3 Diluted weighted average common shares outstanding 99.3 99.5 101.0 Options to purchase approximately 0.2 million and 0.1 million shares of common stock were outstanding as of December 31, 2017 and 2016 , respectively, but were not included in the computation of diluted weighted-average shares because to do so would have been antidilutive. In February 2014, our board of directors approved an increase in our common stock repurchase authorization from $200 million to $250 million . The repurchase authorization does not require the repurchase of a specific number of shares, has an indefinite term, and is subject to termination at any time by our board of directors. During 2017 , 2016 and 2015 , we repurchased 0.9 million , 1.7 million , and 1.3 million shares of our common stock in the open market for $38.1 million , $65.6 million , and $45.3 million , respectively. In July 2014, our board of directors approved an increase in the quarterly cash dividend on our common stock and declared a dividend of $0.21 per share. The cash dividend of $0.21 per common share was declared and paid each quarter through July 2015. In July 2015, our board of directors approved an increase in the quarterly cash dividend and declared a dividend of $0.23 per share. The cash dividend of $0.23 per common share was declared and paid each quarter through July 2016. In July 2016, our board of directors approved an increase in the quarterly cash dividend on our common stock and declared a dividend of $0.24 per share. The cash dividend of $0.24 per common share was declared and paid each quarter through July 2017. In July 2017, our board of directors approved an increase in our quarterly dividend and declared a cash dividend of $0.25 per share. The cash dividend of $0.25 per common share was declared in July 2017 and October 2017 and paid in October 2017 and January 2018, respectively. On February 23, 2018, our board of directors declared a cash dividend of $0.25 per share, payable on April 16, 2018 to stockholders of record on April 2, 2018. As of December 31, 2017 and 2016 , accrued common stock dividends of $25.4 million and $22.2 million were included in Other current liabilities in our consolidated balance sheet. Future dividend payments are subject to declaration by our board of directors. On April 22, 2015, we delivered notice of the exercise of our rights to force conversion of all outstanding shares of our Convertible perpetual preferred stock (par value of $0.10 per share and liquidation preference of $1,000 per share) pursuant to the underlying certificate of designations. The effective date of the conversion was April 23, 2015. On that date, each share of preferred stock automatically converted into 33.9905 shares of our common stock (par value of $0.01 per share). We completed the forced conversion by issuing and delivering in the aggregate 3,271,415 shares of our common stock to the registered holders of the 96,245 shares of the preferred stock outstanding and paying cash in lieu of fractional shares due to those holders. On September 30, 2009, we issued 5.0 million shares of common stock and 8.2 million common stock warrants in full satisfaction of our obligation to do so under the January 2007 comprehensive settlement of the consolidated securities action brought against us by our stockholders and bondholders. Prior to their expiration on January 17, 2017, the warrants were exercisable at a price of $41.40 per share by means of a cash or a cashless exercise at the option of the holder. The warrants were not assumed exercised for dilutive shares outstanding because they were antidilutive in the 2016 and 2015 periods presented. The following table summarizes information relating to these warrants and their activity through their expiration date (number of warrants in millions): Number of Warrants Weighted Average Exercise Price Common stock warrants outstanding as of December 31, 2016 8.2 $ 41.40 Cashless exercise (6.5 ) 41.40 Cash exercise (0.6 ) 41.40 Expired (1.1 ) 41.40 Common stock warrants outstanding as of January 17, 2017 — The above exercises resulted in the issuance of 0.7 million shares of common stock in January 2017. Cash exercises resulted in gross proceeds of $26.7 million in January 2017. See also Note 9, Long-term Debt . |
Contingencies and Other Commitm
Contingencies and Other Commitments | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies and Other Commitments | Contingencies and Other Commitments : We operate in a highly regulated industry in which healthcare providers are routinely subject to litigation. As a result, various lawsuits, claims, and legal and regulatory proceedings have been and can be expected to be instituted or asserted against us. The resolution of any such lawsuits, claims, or legal and regulatory proceedings could materially and adversely affect our financial position, results of operations, and cash flows in a given period. Nichols Litigation— We have been named as a defendant in a lawsuit filed March 28, 2003 by several individual stockholders in the Circuit Court of Jefferson County, Alabama, captioned Nichols v. HealthSouth Corp . The plaintiffs allege that we, some of our former officers, and our former investment bank engaged in a scheme to overstate and misrepresent our earnings and financial position. The plaintiffs are seeking compensatory and punitive damages. This case was stayed in the Circuit Court on August 8, 2005. The plaintiffs filed an amended complaint on November 9, 2010 to which we responded with a motion to dismiss filed on December 22, 2010. During a hearing on February 24, 2012, plaintiffs’ counsel indicated his intent to dismiss certain claims against us. Instead, on March 9, 2012, the plaintiffs amended their complaint to include additional securities fraud claims against Encompass Health and add several former officers to the lawsuit. On September 12, 2012, the plaintiffs further amended their complaint to request certification as a class action. One of those named officers has repeatedly attempted to remove the case to federal district court, most recently on December 11, 2012. We filed our latest motion to remand the case back to state court on January 10, 2013. On September 27, 2013, the federal court remanded the case back to state court. On November 25, 2014, the plaintiffs filed another amended complaint to assert new allegations relating to the time period of 1997 to 2002. On December 10, 2014, we filed a motion to dismiss on the grounds the plaintiffs lack standing because their claims are derivative in nature, and the claims are time-barred by the statute of limitations. On May 26, 2016, the court granted our motion to dismiss. The plaintiffs appealed the dismissal of the case to the Supreme Court of Alabama on June 28, 2016. The supreme court has not yet scheduled a hearing on the appeal. We are vigorously defending ourselves in this case. Based on the stage of litigation, review of the current facts and circumstances as we understand them, the nature of the underlying claim, the results of the proceedings to date, and the nature and scope of the defense we continue to mount, we do not believe an adverse judgment or settlement is probable in this matter, and it is also not possible to estimate an amount of loss, if any, or range of possible loss that might result from an adverse judgment or settlement of this case. Other Litigation— One of our hospital subsidiaries was named as a defendant in a lawsuit filed August 12, 2013 by an individual in the Circuit Court of Etowah County, Alabama, captioned Honts v. HealthSouth Rehabilitation Hospital of Gadsden, LLC. The plaintiff alleged that her mother, who died more than three months after being discharged from our hospital, received an unprescribed opiate medication at the hospital. We deny the patient received any such medication, accounted for all the opiates at the hospital and argued the plaintiff established no causal liability between the actions of our staff and her mother’s death. The plaintiff sought recovery for punitive damages. On May 18, 2016, the jury in this case returned a verdict in favor of the plaintiff for $20.0 million . On June 17, 2016, we filed a renewed motion for judgment as a matter of law or, in the alternative, a motion for new trial or, in the further alternative, a motion seeking reduction of the damages awarded (collectively, the “post-judgment motions”). The trial court denied the post-judgment motions. We appealed the verdict as well as the rulings on the post-judgment motions to the Supreme Court of Alabama on October 12, 2016. On November 8, 2017, the supreme court heard the oral argument of the appeal but has not yet rendered a decision. We posted a bond in the amount of the judgment pending resolution of our appeal. We are vigorously defending ourselves in this case. Although we continue to believe in the merit of our defenses and counterarguments, we have recorded a net charge of $5.7 million to Other operating expenses in our consolidated statements of operations for the year ended December 31, 2016. As of December 31, 2017, we maintained a liability of $20.2 million in Accrued expenses and other liabilities in our consolidated balance sheet with a corresponding receivable of $15.5 million in Other current assets for the portion of the liability we would expect to be covered through our excess insurance coverages. The portion of this liability that would be a covered claim through our captive insurance subsidiary, HCS, Ltd. is $6.0 million . Governmental Inquiries and Investigations— On March 4, 2013, we received document subpoenas from an office of the HHS-OIG addressed to four of our hospitals. Those subpoenas also requested complete copies of medical records for 100 patients treated at each of those hospitals between September 2008 and June 2012. The investigation is being conducted by the United States Department of Justice (the “DOJ”). On April 24, 2014, we received document subpoenas relating to an additional seven of our hospitals. The new subpoenas reference substantially similar investigation subject matter as the original subpoenas and request materials from the period January 2008 through December 2013. Two of the four hospitals addressed in the original set of subpoenas have received supplemental subpoenas to cover this new time period. The most recent subpoenas do not include requests for specific patient files. However, in February 2015, the DOJ requested the voluntary production of the medical records of an additional 70 patients, some of whom were treated in hospitals not subject to the subpoenas, and we provided these records. We have not received any subsequent requests for medical records from the DOJ. All of the subpoenas are in connection with an investigation of alleged improper or fraudulent claims submitted to Medicare and Medicaid and request documents and materials relating to practices, procedures, protocols and policies, of certain pre- and post-admissions activities at these hospitals including, among other things, marketing functions, pre-admission screening, post-admission physician evaluations, patient assessment instruments, individualized patient plans of care, and compliance with the Medicare 60% rule. Under the Medicare rule commonly referred to as the “ 60% rule,” an inpatient rehabilitation hospital must treat 60% or more of its patients from at least one of a specified list of medical conditions in order to be reimbursed at the inpatient rehabilitation hospital payment rates, rather than at the lower acute care hospital payment rates. We are cooperating fully with the DOJ in connection with this investigation and are currently unable to predict the timing or outcome of it. We intend to vigorously defend ourselves in this matter. Based on discussions with the DOJ, review of the current facts and circumstances as we understand them, and the nature of the investigation, it is not possible to estimate an amount of loss, if any, or range of possible loss that might result from it. Other Matters— The False Claims Act allows private citizens, called “relators,” to institute civil proceedings on behalf of the United States alleging violations of the False Claims Act. These lawsuits, also known as “whistleblower” or “ qui tam ” actions, can involve significant monetary damages, fines, attorneys’ fees and the award of bounties to the relators who successfully prosecute or bring these suits to the government. Qui tam cases are sealed at the time of filing, which means knowledge of the information contained in the complaint typically is limited to the relator, the federal government, and the presiding court. The defendant in a qui tam action may remain unaware of the existence of a sealed complaint for years. While the complaint is under seal, the government reviews the merits of the case and may conduct a broad investigation and seek discovery from the defendant and other parties before deciding whether to intervene in the case and take the lead on litigating the claims. The court lifts the seal when the government makes its decision on whether to intervene. If the government decides not to intervene, the relator may elect to continue to pursue the lawsuit individually on behalf of the government. It is possible that qui tam lawsuits have been filed against us, which suits remain under seal, or that we are unaware of such filings or precluded by existing law or court order from discussing or disclosing the filing of such suits. We may be subject to liability under one or more undisclosed qui tam cases brought pursuant to the False Claims Act. It is our obligation as a participant in Medicare and other federal healthcare programs to routinely conduct audits and reviews of the accuracy of our billing systems and other regulatory compliance matters. As a result of these reviews, we have made, and will continue to make, disclosures to the HHS-OIG and CMS relating to amounts we suspect represent over-payments from these programs, whether due to inaccurate billing or otherwise. Some of these disclosures have resulted in, or may result in, Encompass Health refunding amounts to Medicare or other federal healthcare programs. Other Commitments— We are a party to service and other contracts in connection with conducting our business. Minimum amounts due under these agreements are $35.6 million in 2018 , $20.5 million in 2019 , $16.9 million in 2020 , $8.8 million in 2021 , $1.7 million in 2022 , and $2.0 million thereafter. These contracts primarily relate to software licensing and support. |
Segment Reporting Segment Repor
Segment Reporting Segment Reporting | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting : Our internal financial reporting and management structure is focused on the major types of services provided by Encompass Health. We manage our operations using two operating segments which are also our reportable segments: (1) inpatient rehabilitation and (2) home health and hospice. These reportable operating segments are consistent with information used by our chief executive officer, who is our chief operating decision maker, to assess performance and allocate resources. The following is a brief description of our reportable segments: • Inpatient Rehabilitation - Our national network of inpatient rehabilitation hospitals stretches across 31 states and Puerto Rico, with a concentration of hospitals in the eastern half of the United States and Texas. As of December 31, 2017 , we operate 127 inpatient rehabilitation hospitals, including one hospital that operates as a joint venture which we account for using the equity method of accounting. In addition, we manage four inpatient rehabilitation units through management contracts. We provide specialized rehabilitative treatment on both an inpatient and outpatient basis. Our inpatient rehabilitation hospitals provide a higher level of rehabilitative care to patients who are recovering from conditions such as stroke and other neurological disorders, cardiac and pulmonary conditions, brain and spinal cord injuries, complex orthopedic conditions, and amputations. • Home Health and Hospice - As of December 31, 2017 , we provide home health and hospice services in 237 locations across 28 states with concentrations in the Southeast and Texas. In addition, two of these agencies operate as joint ventures which we account for using the equity method of accounting. Our home health services include a comprehensive range of Medicare-certified home nursing services to adult patients in need of care. These services include, among others, skilled nursing, physical, occupational, and speech therapy, medical social work, and home health aide services. Our hospice services include in-home services to terminally ill patients and their families to address patients’ physical needs, including pain control and symptom management, and to provide emotional and spiritual support. The accounting policies of our reportable segments are the same as those described in Note 1, Summary of Significant Accounting Policies . All revenues for our services are generated through external customers. See Note 1, Summary of Significant Accounting Policies , “Net Operating Revenues,” for the payor composition of our revenues. No corporate overhead is allocated to either of our reportable segments. Our chief operating decision maker evaluates the performance of our segments and allocates resources to them based on adjusted earnings before interest, taxes, depreciation, and amortization (“Segment Adjusted EBITDA”). Selected financial information for our reportable segments is as follows (in millions): Inpatient Rehabilitation Home Health and Hospice For the Year Ended December 31, For the Year Ended December 31, 2017 2016 2015 2017 2016 2015 Net operating revenues $ 3,188.1 $ 3,021.1 $ 2,653.1 $ 783.3 $ 686.1 $ 509.8 Less: Provision for doubtful accounts (46.8 ) (57.0 ) (44.7 ) (5.6 ) (4.2 ) (2.5 ) Net operating revenues less provision for doubtful accounts 3,141.3 2,964.1 2,608.4 777.7 681.9 507.3 Operating expenses: Inpatient rehabilitation: Salaries and benefits 1,603.8 1,493.4 1,310.6 — — — Other operating expenses 462.5 431.5 387.7 — — — Supplies 135.7 128.8 120.9 — — — Occupancy costs 61.9 61.2 46.2 — — — Home health and hospice: Cost of services sold (excluding depreciation and amortization) — — — 368.4 336.5 244.8 Support and overhead costs — — — 277.2 237.2 172.7 2,263.9 2,114.9 1,865.4 645.6 573.7 417.5 Other income (4.1 ) (2.9 ) (2.3 ) — — — Equity in net income of nonconsolidated affiliates (7.3 ) (9.1 ) (8.6 ) (0.7 ) (0.7 ) (0.1 ) Noncontrolling interests 67.6 64.0 62.9 6.9 6.5 6.8 Segment Adjusted EBITDA $ 821.2 $ 797.2 $ 691.0 $ 125.9 $ 102.4 $ 83.1 Capital expenditures $ 238.0 $ 198.3 $ 151.7 $ 10.7 $ 8.7 $ 5.8 Inpatient Rehabilitation Home Health and Hospice Encompass Health Consolidated As of December 31, 2017 Total assets $ 3,789.1 $ 1,150.5 $ 4,893.7 Investments in and advances to nonconsolidated affiliates 9.3 2.6 11.9 As of December 31, 2016 Total assets $ 3,629.6 $ 1,123.7 $ 4,681.9 Investments in and advances to nonconsolidated affiliates 10.6 2.4 13.0 Segment reconciliations (in millions): For the Year Ended December 31, 2017 2016 2015 Total segment Adjusted EBITDA $ 947.1 $ 899.6 $ 774.1 General and administrative expenses (171.7 ) (133.4 ) (133.3 ) Depreciation and amortization (183.8 ) (172.6 ) (139.7 ) Loss on disposal of assets (4.6 ) (0.7 ) (2.6 ) Government, class action, and related settlements — — (7.5 ) Professional fees — accounting, tax, and legal — (1.9 ) (3.0 ) Loss on early extinguishment of debt (10.7 ) (7.4 ) (22.4 ) Interest expense and amortization of debt discounts and fees (154.4 ) (172.1 ) (142.9 ) Net income attributable to noncontrolling interests 79.1 70.5 69.7 Tax reform impact on noncontrolling interests (4.6 ) — — Gain related to SCA equity interest — — 3.2 Income from continuing operations before income tax expense $ 496.4 $ 482.0 $ 395.6 As of December 31, 2017 As of December 31, 2016 Total assets for reportable segments $ 4,939.6 $ 4,753.3 Reclassification of noncurrent deferred income tax liabilities to net noncurrent deferred income tax assets (45.9 ) (71.4 ) Total consolidated assets $ 4,893.7 $ 4,681.9 Additional detail regarding the revenues of our operating segments by service line follows (in millions): For the Year Ended December 31, 2017 2016 2015 Inpatient rehabilitation: Inpatient $ 3,082.4 $ 2,905.5 $ 2,547.2 Outpatient and other 105.7 115.6 105.9 Total inpatient rehabilitation 3,188.1 3,021.1 2,653.1 Home health and hospice: Home health 706.7 635.2 478.1 Hospice 76.6 50.9 31.7 Total home health and hospice 783.3 686.1 509.8 Total net operating revenues $ 3,971.4 $ 3,707.2 $ 3,162.9 |
Quarterly Data (Unaudited)
Quarterly Data (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Data (Unaudited) | Quarterly Data (Unaudited) : 2017 First Second Third Fourth Total (In Millions, Except Per Share Data) Net operating revenues $ 974.8 $ 981.3 $ 995.6 $ 1,019.7 $ 3,971.4 Operating earnings (a) 147.1 141.3 145.2 144.7 578.3 Provision for income tax expense 39.7 28.6 43.1 49.2 160.6 Income from continuing operations 84.7 79.2 85.2 86.7 335.8 (Loss) income from discontinued operations, net of tax (0.3 ) 0.2 (0.1 ) (0.2 ) (0.4 ) Net income 84.4 79.4 85.1 86.5 335.4 Less: Net income attributable to noncontrolling interests (17.6 ) (16.4 ) (19.2 ) (25.9 ) (79.1 ) Net income attributable to Encompass Health $ 66.8 $ 63.0 $ 65.9 $ 60.6 $ 256.3 Earnings per common share: Basic earnings per share attributable to Encompass Health common shareholders: (b) Continuing operations $ 0.75 $ 0.70 $ 0.67 $ 0.62 $ 2.73 Discontinued operations — — — — — Net income $ 0.75 $ 0.70 $ 0.67 $ 0.62 $ 2.73 Diluted earnings per share attributable to Encompass Health common shareholders: (b) (c) Continuing operations $ 0.70 $ 0.70 $ 0.67 $ 0.61 $ 2.69 Discontinued operations — — — — — Net income $ 0.70 $ 0.70 $ 0.67 $ 0.61 $ 2.69 (a) We define operating earnings as income from continuing operations attributable to Encompass Health before (1) loss on early extinguishment of debt; (2) interest expense and amortization of debt discounts and fees; (3) other income; and (4) income tax expense. (b) Per share amounts may not sum due to the weighted average common shares outstanding during each quarter compared to the weighted average common shares outstanding during the entire year. (c) For the second quarter of 2017, adding back the loss on extinguishment of convertible debt, net of tax to our Income from continuing operations attributable to Encompass Health common shareholders causes a per share increase when calculating diluted earnings per common share resulting in an antidilutive per share amount. Therefore, basic and diluted earnings per common share are the same for the three months ended June 30, 2017. 2016 First Second Third Fourth Total (In Millions, Except Per Share Data) Net operating revenues $ 909.8 $ 920.7 $ 926.8 $ 949.9 $ 3,707.2 Operating earnings (a) 144.2 150.2 148.2 145.5 588.1 Provision for income tax expense 39.7 42.4 42.1 39.7 163.9 Income from continuing operations 76.8 81.3 78.2 81.8 318.1 (Loss) income from discontinued operations, net of tax (0.1 ) (0.1 ) (0.1 ) 0.3 — Net income 76.7 81.2 78.1 82.1 318.1 Less: Net income attributable to noncontrolling interests (18.7 ) (18.6 ) (16.4 ) (16.8 ) (70.5 ) Net income attributable to Encompass Health $ 58.0 $ 62.6 $ 61.7 $ 65.3 $ 247.6 Earnings per common share: Basic earnings per share attributable to Encompass Health common shareholders: (b) Continuing operations $ 0.65 $ 0.70 $ 0.69 $ 0.73 $ 2.77 Discontinued operations — — — — — Net income $ 0.65 $ 0.70 $ 0.69 $ 0.73 $ 2.77 Diluted earnings per share attributable to Encompass Health common shareholders: (b) Continuing operations $ 0.61 $ 0.65 $ 0.64 $ 0.68 $ 2.59 Discontinued operations — — — — — Net income $ 0.61 $ 0.65 $ 0.64 $ 0.68 $ 2.59 (a) We define operating earnings as income from continuing operations attributable to Encompass Health before (1) loss on early extinguishment of debt; (2) interest expense and amortization of debt discounts and fees; (3) other income; and (4) income tax expense. (b) Per share amounts may not sum due to the weighted average common shares outstanding during each quarter compared to the weighted average common shares outstanding during the entire year. |
Condensed Consolidating Financi
Condensed Consolidating Financial Information | 12 Months Ended |
Dec. 31, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Consolidating Financial Information | Condensed Consolidating Financial Information : The accompanying condensed consolidating financial information has been prepared and presented pursuant to SEC Regulation S-X, Rule 3-10, “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.” Each of the subsidiary guarantors is 100% owned by Encompass Health, and all guarantees are full and unconditional and joint and several, subject to certain customary conditions for release. Encompass Health’s investments in its consolidated subsidiaries, as well as guarantor subsidiaries’ investments in nonguarantor subsidiaries and nonguarantor subsidiaries’ investments in guarantor subsidiaries, are presented under the equity method of accounting with the related investment presented within the line items Intercompany receivable and Intercompany payable in the accompanying condensed consolidating balance sheets. The terms of our credit agreement allow us to declare and pay cash dividends on our common stock so long as: (1) we are not in default under our credit agreement and (2) our senior secured leverage ratio (as defined in our credit agreement) remains less than or equal to 2 x. The terms of our senior note indenture allow us to declare and pay cash dividends on our common stock so long as (1) we are not in default, (2) the consolidated coverage ratio (as defined in the indenture) exceeds 2 x or we are otherwise allowed under the indenture to incur debt, and (3) we have capacity under the indenture’s restricted payments covenant to declare and pay dividends. See Note 9, Long-term Debt . Periodically, certain wholly owned subsidiaries of Encompass Health make dividends or distributions of available cash and/or intercompany receivable balances to their parents. In addition, Encompass Health makes contributions to certain wholly owned subsidiaries. When made, these dividends, distributions, and contributions impact the Intercompany receivable , Intercompany payable , and Encompass Health shareholders’ equity line items in the accompanying condensed consolidating balance sheet but have no impact on the consolidated financial statements of Encompass Health Corporation. For the Year Ended December 31, 2017 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net operating revenues $ 21.3 $ 2,258.7 $ 1,817.5 $ (126.1 ) $ 3,971.4 Less: Provision for doubtful accounts — (30.7 ) (21.7 ) — (52.4 ) Net operating revenues less provision for doubtful accounts 21.3 2,228.0 1,795.8 (126.1 ) 3,919.0 Operating expenses: Salaries and benefits 34.7 1,077.4 1,063.5 (21.0 ) 2,154.6 Other operating expenses 32.8 321.8 230.7 (48.6 ) 536.7 Occupancy costs 1.9 93.4 34.7 (56.5 ) 73.5 Supplies — 93.2 56.1 — 149.3 General and administrative expenses 143.7 — 28.0 — 171.7 Depreciation and amortization 8.8 103.4 71.6 — 183.8 Total operating expenses 221.9 1,689.2 1,484.6 (126.1 ) 3,269.6 Loss on early extinguishment of debt 10.7 — — — 10.7 Interest expense and amortization of debt discounts and fees 130.5 21.1 23.8 (21.0 ) 154.4 Other (income) loss (21.7 ) 0.2 (3.6 ) 21.0 (4.1 ) Equity in net income of nonconsolidated affiliates — (7.3 ) (0.7 ) — (8.0 ) Equity in net income of consolidated affiliates (341.6 ) (40.3 ) — 381.9 — Management fees (145.0 ) 108.3 36.7 — — Income from continuing operations before income tax (benefit) expense 166.5 456.8 255.0 (381.9 ) 496.4 Provision for income tax (benefit) expense (90.2 ) 182.3 68.5 — 160.6 Income from continuing operations 256.7 274.5 186.5 (381.9 ) 335.8 Loss from discontinued operations, net of tax (0.4 ) — — — (0.4 ) Net income 256.3 274.5 186.5 (381.9 ) 335.4 Less: Net income attributable to noncontrolling interests — — (79.1 ) — (79.1 ) Net income attributable to Encompass Health $ 256.3 $ 274.5 $ 107.4 $ (381.9 ) $ 256.3 Comprehensive income $ 256.2 $ 274.5 $ 186.5 $ (381.9 ) $ 335.3 Comprehensive income attributable to Encompass Health $ 256.2 $ 274.5 $ 107.4 $ (381.9 ) $ 256.2 For the Year Ended December 31, 2016 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net operating revenues $ 20.1 $ 2,171.7 $ 1,633.3 $ (117.9 ) $ 3,707.2 Less: Provision for doubtful accounts — (41.8 ) (19.4 ) — (61.2 ) Net operating revenues less provision for doubtful accounts 20.1 2,129.9 1,613.9 (117.9 ) 3,646.0 Operating expenses: Salaries and benefits 45.5 1,006.1 952.6 (18.3 ) 1,985.9 Other operating expenses 25.5 309.8 203.1 (46.3 ) 492.1 Occupancy costs 2.9 89.8 31.9 (53.3 ) 71.3 Supplies — 89.9 50.1 — 140.0 General and administrative expenses 126.7 — 6.7 — 133.4 Depreciation and amortization 9.4 102.8 60.4 — 172.6 Professional fees—accounting, tax, and legal 1.9 — — — 1.9 Total operating expenses 211.9 1,598.4 1,304.8 (117.9 ) 2,997.2 Loss on early extinguishment of debt 7.4 — — — 7.4 Interest expense and amortization of debt discounts and fees 147.3 21.6 23.1 (19.9 ) 172.1 Other income (19.6 ) (0.4 ) (2.8 ) 19.9 (2.9 ) Equity in net income of nonconsolidated affiliates — (9.0 ) (0.8 ) — (9.8 ) Equity in net income of consolidated affiliates (347.2 ) (41.2 ) — 388.4 — Management fees (136.2 ) 103.1 33.1 — — Income from continuing operations before income tax (benefit) expense 156.5 457.4 256.5 (388.4 ) 482.0 Provision for income tax (benefit) expense (91.1 ) 182.6 72.4 — 163.9 Income from continuing operations 247.6 274.8 184.1 (388.4 ) 318.1 Income from discontinued operations, net of tax — — — — — Net income 247.6 274.8 184.1 (388.4 ) 318.1 Less: Net income attributable to noncontrolling interests — — (70.5 ) — (70.5 ) Net income attributable to Encompass Health $ 247.6 $ 274.8 $ 113.6 $ (388.4 ) $ 247.6 Comprehensive income $ 247.6 $ 274.8 $ 184.1 $ (388.4 ) $ 318.1 Comprehensive income attributable to Encompass Health $ 247.6 $ 274.8 $ 113.6 $ (388.4 ) $ 247.6 For the Year Ended December 31, 2015 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net operating revenues $ 19.4 $ 1,871.6 $ 1,375.4 $ (103.5 ) $ 3,162.9 Less: Provision for doubtful accounts — (33.7 ) (13.5 ) — (47.2 ) Net operating revenues less provision for doubtful accounts 19.4 1,837.9 1,361.9 (103.5 ) 3,115.7 Operating expenses: Salaries and benefits 49.4 866.7 771.8 (17.1 ) 1,670.8 Other operating expenses 31.3 266.2 175.9 (41.3 ) 432.1 Occupancy costs 4.0 66.9 28.1 (45.1 ) 53.9 Supplies — 82.8 45.9 — 128.7 General and administrative expenses 128.3 — 5.0 — 133.3 Depreciation and amortization 9.9 82.8 47.0 — 139.7 Government, class action, and related settlements 7.5 — — — 7.5 Professional fees—accounting, tax, and legal 3.0 — — — 3.0 Total operating expenses 233.4 1,365.4 1,073.7 (103.5 ) 2,569.0 Loss on early extinguishment of debt 22.4 — — — 22.4 Interest expense and amortization of debt discounts and fees 130.0 11.2 13.1 (11.4 ) 142.9 Other income (13.6 ) (0.2 ) (3.1 ) 11.4 (5.5 ) Equity in net income of nonconsolidated affiliates — (8.5 ) (0.2 ) — (8.7 ) Equity in net income of consolidated affiliates (320.4 ) (40.3 ) — 360.7 — Management fees (119.7 ) 88.8 30.9 — — Income from continuing operations before income tax (benefit) expense 87.3 421.5 247.5 (360.7 ) 395.6 Provision for income tax (benefit) expense (96.9 ) 168.2 70.6 — 141.9 Income from continuing operations 184.2 253.3 176.9 (360.7 ) 253.7 (Loss) income from discontinued operations, net of tax (1.1 ) — 0.2 — (0.9 ) Net income 183.1 253.3 177.1 (360.7 ) 252.8 Less: Net income attributable to noncontrolling interests — — (69.7 ) — (69.7 ) Net income attributable to Encompass Health $ 183.1 $ 253.3 $ 107.4 $ (360.7 ) $ 183.1 Comprehensive income $ 182.4 $ 253.3 $ 177.1 $ (360.7 ) $ 252.1 Comprehensive income attributable to Encompass Health $ 182.4 $ 253.3 $ 107.4 $ (360.7 ) $ 182.4 As of December 31, 2017 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Assets Current assets: Cash and cash equivalents $ 34.3 $ 2.9 $ 17.2 $ — $ 54.4 Restricted cash — — 62.4 — 62.4 Accounts receivable, net — 285.2 186.9 — 472.1 Prepaid expenses and other current assets 61.4 21.7 48.7 (18.5 ) 113.3 Total current assets 95.7 309.8 315.2 (18.5 ) 702.2 Property and equipment, net 101.8 991.5 423.8 — 1,517.1 Goodwill — 854.6 1,118.0 — 1,972.6 Intangible assets, net 11.8 105.1 286.2 — 403.1 Deferred income tax assets 97.4 8.4 — (42.2 ) 63.6 Other long-term assets 49.2 100.5 85.4 — 235.1 Intercompany notes receivable 486.2 — — (486.2 ) — Intercompany receivable and investments in consolidated affiliates 2,839.1 311.3 — (3,150.4 ) — Total assets $ 3,681.2 $ 2,681.2 $ 2,228.6 $ (3,697.3 ) $ 4,893.7 Liabilities and Shareholders’ Equity Current liabilities: Current portion of long-term debt $ 32.8 $ 7.4 $ 9.6 $ (17.5 ) $ 32.3 Accounts payable 10.4 43.5 24.5 — 78.4 Accrued payroll 36.1 63.8 72.2 — 172.1 Accrued interest payable 21.9 2.6 0.2 — 24.7 Other current liabilities 108.8 15.6 86.6 (1.0 ) 210.0 Total current liabilities 210.0 132.9 193.1 (18.5 ) 517.5 Long-term debt, net of current portion 2,258.5 242.2 44.7 — 2,545.4 Intercompany notes payable — — 486.2 (486.2 ) — Self-insured risks 9.6 — 100.5 — 110.1 Other long-term liabilities 21.4 17.8 78.1 (42.1 ) 75.2 Intercompany payable — — 144.8 (144.8 ) — 2,499.5 392.9 1,047.4 (691.6 ) 3,248.2 Commitments and contingencies Redeemable noncontrolling interests — — 220.9 — 220.9 Shareholders’ equity: Encompass Health shareholders’ equity 1,181.7 2,288.3 717.4 (3,005.7 ) 1,181.7 Noncontrolling interests — — 242.9 — 242.9 Total shareholders’ equity 1,181.7 2,288.3 960.3 (3,005.7 ) 1,424.6 Total liabilities and shareholders’ equity $ 3,681.2 $ 2,681.2 $ 2,228.6 $ (3,697.3 ) $ 4,893.7 As of December 31, 2016 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Assets Current assets: Cash and cash equivalents $ 20.6 $ 1.6 $ 18.3 $ — $ 40.5 Restricted cash — — 60.9 — 60.9 Accounts receivable, net — 273.3 170.5 — 443.8 Prepaid expenses and other current assets 49.9 24.0 54.0 (18.6 ) 109.3 Total current assets 70.5 298.9 303.7 (18.6 ) 654.5 Property and equipment, net 41.6 979.7 370.5 — 1,391.8 Goodwill — 858.4 1,068.8 — 1,927.2 Intangible assets, net 12.0 115.5 283.8 — 411.3 Deferred income tax assets 90.9 57.6 — (72.7 ) 75.8 Other long-term assets 49.0 95.1 77.2 — 221.3 Intercompany notes receivable 528.8 — — (528.8 ) — Intercompany receivable and investments in consolidated affiliates 2,855.5 107.7 — (2,963.2 ) — Total assets $ 3,648.3 $ 2,512.9 $ 2,104.0 $ (3,583.3 ) $ 4,681.9 Liabilities and Shareholders’ Equity Current liabilities: Current portion of long-term debt $ 40.0 $ 6.4 $ 8.2 $ (17.5 ) $ 37.1 Accounts payable 7.0 37.2 24.1 — 68.3 Accrued payroll 31.6 57.3 58.4 — 147.3 Accrued interest payable 22.8 2.8 0.2 — 25.8 Other current liabilities 96.3 21.6 80.3 (1.1 ) 197.1 Total current liabilities 197.7 125.3 171.2 (18.6 ) 475.6 Long-term debt, net of current portion 2,679.2 248.9 51.2 — 2,979.3 Intercompany notes payable — — 528.8 (528.8 ) — Self-insured risks 14.1 — 96.3 — 110.4 Other long-term liabilities 21.4 15.2 85.3 (72.3 ) 49.6 Intercompany payable — — 167.6 (167.6 ) — 2,912.4 389.4 1,100.4 (787.3 ) 3,614.9 Commitments and contingencies Redeemable noncontrolling interests — — 138.3 — 138.3 Shareholders’ equity: Encompass Health shareholders’ equity 735.9 2,123.5 672.5 (2,796.0 ) 735.9 Noncontrolling interests — — 192.8 — 192.8 Total shareholders’ equity 735.9 2,123.5 865.3 (2,796.0 ) 928.7 Total liabilities and shareholders’ equity $ 3,648.3 $ 2,512.9 $ 2,104.0 $ (3,583.3 ) $ 4,681.9 For the Year Ended December 31, 2017 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net cash provided by operating activities $ 27.6 $ 381.3 $ 248.3 $ — $ 657.2 Cash flows from investing activities: Acquisition of businesses, net of cash acquired (10.9 ) — (27.9 ) — (38.8 ) Purchases of property and equipment (39.4 ) (106.1 ) (80.3 ) — (225.8 ) Additions to capitalized software costs (16.3 ) (0.2 ) (2.7 ) — (19.2 ) Proceeds from disposal of assets — 11.7 0.6 — 12.3 Purchases of restricted investments — — (8.5 ) — (8.5 ) Net change in restricted cash — — (1.5 ) — (1.5 ) Proceeds from repayment of intercompany note receivable 51.0 — — (51.0 ) — Other (3.7 ) — 0.7 — (3.0 ) Net cash used in investing activities (19.3 ) (94.6 ) (119.6 ) (51.0 ) (284.5 ) Cash flows from financing activities: Principal payments on debt, including pre-payments (126.9 ) — (3.0 ) — (129.9 ) Principal payments on intercompany note payable — — (51.0 ) 51.0 — Borrowings on revolving credit facility 273.3 — — — 273.3 Payments on revolving credit facility (330.3 ) — — — (330.3 ) Principal payments under capital lease obligations — (6.8 ) (8.5 ) — (15.3 ) Debt amendment and issuance costs (3.1 ) — — — (3.1 ) Repurchases of common stock, including fees and expenses (38.1 ) — — — (38.1 ) Dividends paid on common stock (91.5 ) — — — (91.5 ) Proceeds from exercising stock warrants 26.6 — — — 26.6 Distributions paid to noncontrolling interests of consolidated affiliates — — (51.9 ) — (51.9 ) Taxes paid on behalf of employees for shares withheld (19.5 ) — (0.3 ) — (19.8 ) Contributions from consolidated affiliates — — 20.8 — 20.8 Other 1.1 — (0.7 ) — 0.4 Change in intercompany advances 313.8 (278.6 ) (35.2 ) — — Net cash provided by (used in) financing activities 5.4 (285.4 ) (129.8 ) 51.0 (358.8 ) Increase (decrease) in cash and cash equivalents 13.7 1.3 (1.1 ) — 13.9 Cash and cash equivalents at beginning of year 20.6 1.6 18.3 — 40.5 Cash and cash equivalents at end of year $ 34.3 $ 2.9 $ 17.2 $ — $ 54.4 Supplemental schedule of noncash financing activity: Conversion of convertible debt $ 319.4 $ — $ — $ — $ 319.4 For the Year Ended December 31, 2016 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net cash provided by operating activities $ 65.8 $ 327.4 $ 241.2 $ — $ 634.4 Cash flows from investing activities: Acquisition of businesses, net of cash acquired — — (48.1 ) — (48.1 ) Purchases of property and equipment (21.8 ) (77.4 ) (78.5 ) — (177.7 ) Additions to capitalized software costs (22.8 ) (0.2 ) (2.2 ) — (25.2 ) Proceeds from disposal of assets — 0.7 23.2 — 23.9 Purchases of restricted investments — — (1.3 ) — (1.3 ) Net change in restricted cash — — (15.1 ) — (15.1 ) Funding of intercompany note receivable (22.5 ) — — 22.5 — Proceeds from repayment of intercompany note receivable 52.0 — — (52.0 ) — Other (3.7 ) (0.2 ) 2.3 — (1.6 ) Net cash provided by investing activities of discontinued operations 0.1 — — — 0.1 Net cash used in investing activities (18.7 ) (77.1 ) (119.7 ) (29.5 ) (245.0 ) Cash flows from financing activities: Principal payments on debt, including pre-payments (198.5 ) (1.3 ) (2.3 ) — (202.1 ) Principal borrowings on intercompany notes payable — — 22.5 (22.5 ) — Principal payments on intercompany notes payable — — (52.0 ) 52.0 — Borrowings on revolving credit facility 335.0 — — — 335.0 Payments on revolving credit facility (313.0 ) — — — (313.0 ) Principal payments under capital lease obligations (0.1 ) (5.9 ) (7.3 ) — (13.3 ) Repurchases of common stock, including fees and expenses (65.6 ) — — — (65.6 ) Dividends paid on common stock (83.8 ) — — — (83.8 ) Distributions paid to noncontrolling interests of consolidated affiliates — — (64.9 ) — (64.9 ) Taxes paid on behalf of employees for shares withheld (11.6 ) — — — (11.6 ) Contributions from consolidated affiliates — — 3.5 — 3.5 Other 6.9 — (1.6 ) — 5.3 Change in intercompany advances 263.0 (242.7 ) (20.3 ) — — Net cash used in financing activities (67.7 ) (249.9 ) (122.4 ) 29.5 (410.5 ) (Decrease) increase in cash and cash equivalents (20.6 ) 0.4 (0.9 ) — (21.1 ) Cash and cash equivalents at beginning of year 41.2 1.2 19.2 — 61.6 Cash and cash equivalents at end of year $ 20.6 $ 1.6 $ 18.3 $ — $ 40.5 For the Year Ended December 31, 2015 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net cash provided by operating activities $ 59.7 $ 214.6 $ 227.7 $ — $ 502.0 Cash flows from investing activities: Acquisition of businesses, net of cash acquired (954.6 ) — (30.5 ) — (985.1 ) Purchases of property and equipment (15.9 ) (62.0 ) (50.5 ) — (128.4 ) Additions to capitalized software costs (24.5 ) (0.4 ) (3.2 ) — (28.1 ) Proceeds from disposal of assets — 3.5 0.5 — 4.0 Proceeds from sale of nonrestricted marketable securities 12.8 — — — 12.8 Purchases of restricted investments — — (7.1 ) — (7.1 ) Net change in restricted cash — — 2.7 — 2.7 Funding of intercompany note receivable (2.0 ) — — 2.0 — Proceeds from repayment of intercompany note receivable 24.0 — — (24.0 ) — Other (0.5 ) (1.9 ) 1.3 — (1.1 ) Net cash provided by investing activities of discontinued operations 0.5 — — — 0.5 Net cash used in investing activities (960.2 ) (60.8 ) (86.8 ) (22.0 ) (1,129.8 ) Cash flows from financing activities: Principal borrowings on term loan facilities 250.0 — — — 250.0 Proceeds from bond issuance 1,400.0 — — — 1,400.0 Principal payments on debt, including pre-payments (595.0 ) (1.6 ) (0.8 ) — (597.4 ) Principal borrowings on intercompany notes payable — — 2.0 (2.0 ) — Principal payments on intercompany notes payable — — (24.0 ) 24.0 — Borrowings on revolving credit facility 540.0 — — — 540.0 Payments on revolving credit facility (735.0 ) — — — (735.0 ) Principal payments under capital lease obligations (0.3 ) (4.5 ) (6.2 ) — (11.0 ) Debt amendment and issuance costs (31.9 ) — — — (31.9 ) Repurchases of common stock, including fees and expenses (45.3 ) — — — (45.3 ) Dividends paid on common stock (77.2 ) — — — (77.2 ) Distributions paid to noncontrolling interests of consolidated affiliates — — (54.4 ) — (54.4 ) Taxes paid on behalf of employees for shares withheld (17.2 ) — — — (17.2 ) Contributions from consolidated affiliates — — 3.0 — 3.0 Other (0.9 ) 1.5 (1.5 ) — (0.9 ) Change in intercompany advances 212.6 (149.4 ) (63.2 ) — — Net cash provided by (used in) financing activities 899.8 (154.0 ) (145.1 ) 22.0 622.7 Decrease in cash and cash equivalents (0.7 ) (0.2 ) (4.2 ) — (5.1 ) Cash and cash equivalents at beginning of year 41.9 1.4 23.4 — 66.7 Cash and cash equivalents at end of year $ 41.2 $ 1.2 $ 19.2 $ — $ 61.6 Supplemental schedule of noncash financing activities: Conversion of preferred stock to common stock $ 93.2 $ — $ — $ — $ 93.2 Intercompany note activity $ (183.5 ) $ — $ 183.5 $ — $ — |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation— The accompanying consolidated financial statements of Encompass Health and its subsidiaries were prepared in accordance with generally accepted accounting principles in the United States of America and include the assets, liabilities, revenues, and expenses of all wholly-owned subsidiaries, majority-owned subsidiaries over which we exercise control, and, when applicable, entities in which we have a controlling financial interest. We use the equity method to account for our investments in entities we do not control, but where we have the ability to exercise significant influence over operating and financial policies. Consolidated Net income attributable to Encompass Health includes our share of the net earnings of these entities. The difference between consolidation and the equity method impacts certain of our financial ratios because of the presentation of the detailed line items reported in the consolidated financial statements for consolidated entities compared to a one line presentation of equity method investments. We use the cost method to account for our investments in entities we do not control and for which we do not have the ability to exercise significant influence over operating and financial policies. In accordance with the cost method, these investments are recorded at the lower of cost or fair value, as appropriate. We eliminate all significant intercompany accounts and transactions from our financial results. |
Variable Interest Entities | Variable Interest Entities — Any entity considered a variable interest entity (“VIE”) is evaluated to determine which party is the primary beneficiary and thus should consolidate the VIE. This analysis is complex, involves uncertainties, and requires significant judgment on various matters. In order to determine if we are the primary beneficiary of a VIE, we must determine what activities most significantly impact the economic performance of the entity, whether we have the power to direct those activities, and if our obligation to absorb losses or receive benefits from the VIE could potentially be significant to the VIE. |
Use of Estimates and Assumptions | Use of Estimates and Assumptions— The preparation of our consolidated financial statements in conformity with GAAP requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions are used for, but not limited to: (1) allowance for contractual revenue adjustments; (2) allowance for doubtful accounts; (3) fair value of acquired assets and assumed liabilities in business combinations; (4) asset impairments, including goodwill; (5) depreciable lives of assets; (6) useful lives of intangible assets; (7) economic lives and fair value of leased assets; (8) income tax valuation allowances; (9) uncertain tax positions; (10) fair value of stock options and restricted stock containing a market condition; (11) fair value of redeemable noncontrolling interests; (12) reserves for self-insured healthcare plans; (13) reserves for professional, workers’ compensation, and comprehensive general insurance liability risks; and (14) contingency and litigation reserves. Future events and their effects cannot be predicted with certainty; accordingly, our accounting estimates require the exercise of judgment. The accounting estimates used in the preparation of our consolidated financial statements will change as new events occur, as more experience is acquired, as additional information is obtained, and as our operating environment changes. We evaluate and update our assumptions and estimates on an ongoing basis and may employ outside experts to assist in our evaluation, as considered necessary. Actual results could differ from those estimates. |
Net Operating Revenues | Net Operating Revenues— We derived consolidated Net operating revenues from the following payor sources: For the Year Ended December 31, 2017 2016 2015 Medicare 75.5 % 75.2 % 74.9 % Medicare Advantage 8.7 % 7.9 % 7.9 % Managed care 9.5 % 9.8 % 9.8 % Medicaid 2.7 % 3.2 % 3.0 % Other third-party payors 1.3 % 1.4 % 1.7 % Workers' compensation 0.7 % 0.8 % 0.9 % Patients 0.5 % 0.5 % 0.6 % Other income 1.1 % 1.2 % 1.2 % Total 100.0 % 100.0 % 100.0 % We record gross service charges in our accounting records on an accrual basis using our established rates for the type of service provided to the patient. We recognize an estimated contractual allowance and an estimate of potential subsequent adjustments that may arise from post-payment and other reviews to reduce gross patient charges to the amount we estimate we will actually realize for the service rendered based upon previously agreed to rates with a payor. Our accounting systems calculate contractual allowances on a patient-by-patient basis based on the rates in effect for each primary third-party payor. Management continually reviews the contractual estimation process to consider and incorporate updates to laws and regulations and the frequent changes in managed care contractual terms that result from contract renegotiations and renewals. Due to complexities involved in determining amounts ultimately due under reimbursement arrangements with third-party payors, which are often subject to interpretation, we may receive reimbursement for healthcare services authorized and provided that is different from our estimates, and such differences could be material. In addition, laws and regulations governing the Medicare and Medicaid programs are complex, subject to interpretation, and are routinely modified for provider reimbursement. All healthcare providers participating in the Medicare and Medicaid programs are required to meet certain financial reporting requirements. Federal regulations require submission of annual cost reports covering medical costs and expenses associated with the services provided under each hospital, home health, and hospice provider number to program beneficiaries. Annual cost reports required under the Medicare and Medicaid programs are subject to routine audits, which may result in adjustments to the amounts ultimately determined to be due to Encompass Health under these reimbursement programs. These audits often require several years to reach the final determination of amounts earned under the programs. If actual results are not consistent with our assumptions and judgments, we may be exposed to gains or losses that could be material. CMS has been granted authority to suspend payments, in whole or in part, to Medicare providers if CMS possesses reliable information an overpayment, fraud, or willful misrepresentation exists. If CMS suspects payments are being made as the result of fraud or misrepresentation, CMS may suspend payment at any time without providing prior notice to us. The initial suspension period is limited to 180 days. However, the payment suspension period can be extended almost indefinitely if the matter is under investigation by the United States Department of Health and Human Services Office of Inspector General (the “HHS-OIG”) or the United States Department of Justice. Therefore, we are unable to predict if or when we may be subject to a suspension of payments by the Medicare and/or Medicaid programs, the possible length of the suspension period, or the potential cash flow impact of a payment suspension. Any such suspension would adversely impact our financial position, results of operations, and cash flows. Pursuant to legislative directives and authorizations from Congress, CMS has developed and instituted various Medicare audit programs under which CMS contracts with private companies to conduct claims and medical record audits. As a matter of course, we undertake significant efforts through training and education to ensure compliance with Medicare requirements. However, audits may lead to assertions we have been underpaid or overpaid by Medicare or submitted improper claims in some instances, require us to incur additional costs to respond to requests for records and defend the validity of payments and claims, and ultimately require us to refund any amounts determined to have been overpaid. We cannot predict when or how these audit programs will affect us. Inpatient Rehabilitation Revenues Our inpatient rehabilitation segment derived its Net operating revenues from the following payor sources: For the Year Ended December 31, 2017 2016 2015 Medicare 73.2 % 73.3 % 73.2 % Medicare Advantage 8.4 % 7.7 % 7.9 % Managed care 10.9 % 11.2 % 11.1 % Medicaid 3.1 % 3.0 % 2.5 % Other third-party payors 1.6 % 1.8 % 2.0 % Workers’ compensation 0.9 % 1.0 % 1.1 % Patients 0.6 % 0.6 % 0.7 % Other income 1.3 % 1.4 % 1.5 % Total 100.0 % 100.0 % 100.0 % Revenues recognized by our inpatient rehabilitation segment are subject to a number of elements which impact both the overall amount of revenue realized as well as the timing of the collection of the related accounts receivable. Factors that are considered and could influence the level of our reserves include the patient’s total length of stay for in-house patients, each patient’s discharge destination, the proportion of patients with secondary insurance coverage and the level of reimbursement under that secondary coverage, and the amount of charges that will be disallowed by payors. Such additional factors are assumed to remain consistent with the experience for patients discharged in similar time periods for the same payor classes, and additional reserves are provided to account for these factors. In connection with CMS approved and announced Recovery Audit Contractors (“RACs”) audits related to inpatient rehabilitation facilities (“IRFs”), we received requests from 2013 to 2017 to review certain patient files for discharges occurring from 2010 to 2017 . These RAC audits are focused on identifying Medicare claims that may contain improper payments. RAC contractors must have CMS approval before conducting these focused reviews ranging from billing documentation to medical necessity. Medical necessity is an assessment by an independent physician of a patient’s ability to tolerate and benefit from intensive multi-disciplinary therapy provided in an IRF setting. To date, the Medicare payments that are subject to these audit requests represent less than 1% of our Medicare patient discharges from 2010 to 2017 , and not all of these patient file requests have resulted in payment denial determinations by the RACs. Because we have confidence in the medical judgment of both the referring and the admitting physicians who assess the treatment needs of their patients, we have appealed substantially all RAC denials arising from these audits using the same process we follow for appealing denials of certain diagnosis codes by Medicare Administrative Contractors (“MACs”) (see “Accounts Receivable and Allowance for Doubtful Accounts” below). Due to the delays announced by CMS in the related adjudication process, we believe the resolution of any claims that are subsequently denied as a result of these RAC audits could take in excess of three years. In addition, because we have limited experience with RACs in the context of claims reviews of this nature, we cannot provide assurance as to the future success of these disputes. As such, we make provisions for these claims based on our historical experience and success rates in the claims adjudication process, which is the same process we follow for appealing denials of certain diagnosis codes by MACs. As the ultimate results of these audits impact our estimates of amounts determined to be due to Encompass Health under these reimbursement programs, our provision for claims that are part of this claims review process are recorded to Net operating revenues . During 2017 , 2016 , and 2015 , our adjustment to Net operating revenues for claims that are part of this review process was not material. Home Health and Hospice Revenues Our home health and hospice segment derived its Net operating revenues from the following payor sources: For the Year Ended December 31, 2017 2016 2015 Medicare 85.1 % 82.9 % 83.7 % Medicare Advantage 9.7 % 8.7 % 7.7 % Managed care 3.8 % 3.9 % 3.0 % Medicaid 1.2 % 4.3 % 5.5 % Other third-party payors — % — % — % Workers’ compensation — % — % — % Patients 0.1 % 0.1 % 0.1 % Other income 0.1 % 0.1 % — % Total 100.0 % 100.0 % 100.0 % Home health and hospice revenues are earned as services are performed either on an episode of care basis, on a per visit basis, or on a daily basis, depending upon the payment terms and conditions established with each payor for services provided. Home Health Under the Medicare home health prospective payment system, we are paid by Medicare based on episodes of care. An episode of care is defined as a length of stay up to 60 days, with multiple continuous episodes allowed. A base episode payment is established by the Medicare program through federal legislation. The base episode payment can be adjusted based on each patient’s health including clinical condition, functional abilities, and service needs, as well as for the applicable geographic wage index, low utilization, patient transfers, and other factors. The services covered by the episode payment include all disciplines of care in addition to medical supplies. A portion of reimbursement from each Medicare episode is billed near the start of each episode, and cash is typically received before all services are rendered. Revenue for the episode of care is recorded over an average length of treatment period using a calendar day prorating method. The amount of revenue recognized for episodes of care which are incomplete at period end is based on the pro rata number of days in the episode which have been completed as of the period end date. As of December 31, 2017 , the difference between the cash received from Medicare for a request for anticipated payment on episodes in progress and the associated estimated revenue was not material and was recorded in Other current liabilities in our condensed consolidated balance sheets. We are subject to certain Medicare regulations affecting outlier revenue if our patient’s care was unusually costly. Regulations require a cap on all outlier revenue at 10% of total Medicare revenue received by each provider during a cost reporting year. Management has reviewed the potential cap. Reserves recorded for the outlier cap were not material as of December 31, 2017 . For episodic-based rates that are paid by other insurance carriers, including Medicare Advantage, we recognize revenue in a similar manner as discussed above for Medicare revenues. However, these rates can vary based upon the negotiated terms. For non-episodic-based revenue, gross revenue is recorded on an accrual basis based upon the date of service at amounts equal to our established or estimated per-visit rates. Contractual allowances are recorded for the differences between our standard rates and the applicable contracted rates. Hospice Medicare revenues for hospice are recorded on an accrual basis based on the number of days a patient has been on service at amounts equal to an estimated daily or hourly payment rate. The payment rate is dependent on whether a patient is receiving routine home care, general inpatient care, continuous home care or respite care. Adjustments to Medicare revenues are recorded based on an inability to obtain appropriate billing documentation or authorizations acceptable to the payor or other reasons unrelated to credit risk. Hospice companies are subject to two specific payment limit caps under the Medicare program. One limit relates to inpatient care days that exceed 20% of the total days of hospice care provided for the year. The second limit relates to an aggregate Medicare reimbursement cap calculated by the Medicare fiscal intermediary. Reserves recorded for these caps were not material as of December 31, 2017 . For non-Medicare hospice revenues, we record gross revenue on an accrual basis based upon the date of service at amounts equal to our established rates or estimated per day rates, as applicable. Contractual adjustments are recorded for the difference between our established rates and the amounts estimated to be realizable from patients and third parties for services provided and are deducted from gross revenue to determine our net service revenue. We are subject to changes in government legislation that could impact Medicare payment levels and changes in payor patterns that may impact the level and timing of payments for services rendered. |
Cash and Cash Equivalents | Cash and Cash Equivalents— Cash and cash equivalents include highly liquid investments with maturities of three months or less when purchased. Carrying values of Cash and cash equivalents approximate fair value due to the short-term nature of these instruments. We maintain amounts on deposit with various financial institutions, which may, at times, exceed federally insured limits. However, management periodically evaluates the credit-worthiness of those institutions, and we have not experienced any losses on such deposits. |
Marketable Securities | Marketable Securities— We record all equity securities with readily determinable fair values and for which we do not exercise significant influence as available-for-sale securities. We carry the available-for-sale securities at fair value and report unrealized holding gains or losses, net of income taxes, in Accumulated other comprehensive loss , which is a separate component of shareholders’ equity. We recognize realized gains and losses in our consolidated statements of operations using the specific identification method. Unrealized losses are charged against earnings when a decline in fair value is determined to be other than temporary. Management reviews several factors to determine whether a loss is other than temporary, such as the length of time a security is in an unrealized loss position, the extent to which fair value is less than cost, the financial condition and near term prospects of the issuer, industry, or geographic area and our ability and intent to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts— We report accounts receivable at estimated net realizable amounts from services rendered from federal and state agencies (under the Medicare and Medicaid programs), managed care health plans, commercial insurance companies, workers’ compensation programs, employers, and patients. Our accounts receivable are geographically dispersed, but a significant portion of our revenues are concentrated by type of payors. The concentration of net patient service accounts receivable by payor class, as a percentage of total net patient service accounts receivable, is as follows: As of December 31, 2017 2016 Medicare 75.1 % 73.0 % Managed care and other discount plans, including Medicare Advantage 17.4 % 18.5 % Medicaid 2.4 % 2.7 % Other third-party payors 2.9 % 3.3 % Workers' compensation 1.3 % 1.6 % Patients 0.9 % 0.9 % Total 100.0 % 100.0 % While revenues and accounts receivable from the Medicare program are significant to our operations, we do not believe there are significant credit risks associated with this government agency. We do not believe there are any other significant concentrations of revenues from any particular payor that would subject us to any significant credit risks in the collection of our accounts receivable. We provide for accounts receivable that could become uncollectible by establishing an allowance to reduce the carrying value of such receivables to their estimated net realizable value. Additions to the allowance for doubtful accounts are made by means of the Provision for doubtful accounts . We write off uncollectible accounts (after exhausting collection efforts) against the allowance for doubtful accounts. Subsequent recoveries are recorded via the Provision for doubtful accounts . We estimate our allowance for doubtful accounts based on the aging of our accounts receivable, our historical collection experience for each type of payor, and other relevant factors so that the remaining receivables, net of allowances, are reflected at their estimated net realizable values. Accounts requiring collection efforts are reviewed via system-generated work queues that automatically stage (based on age and size of outstanding balance) accounts requiring collection efforts for patient account representatives. Collection efforts include contacting the applicable party (both in writing and by telephone), providing information (both financial and clinical) to allow for payment or to overturn payor decisions to deny payment, and arranging payment plans with self-pay patients, among other techniques. When we determine all in-house efforts have been exhausted or it is a more prudent use of resources, accounts may be turned over to a collection agency. Accounts are written off after all collection efforts (internal and external) have been exhausted. The collection of outstanding receivables from Medicare, managed care payors, other third-party payors, and patients is our primary source of cash and is critical to our operating performance. While it is our policy to verify insurance prior to a patient being admitted, there are various exceptions that can occur. Such exceptions include instances where we are (1) unable to obtain verification because the patient’s insurance company was unable to be reached or contacted, (2) a determination is made that a patient may be eligible for benefits under various government programs, such as Medicaid, and it takes several days, weeks, or months before qualification for such benefits is confirmed or denied, and (3) the patient is transferred to our hospital from an acute care hospital without having access to a credit card, cash, or check to pay the applicable patient responsibility amounts (i.e., deductibles and co-payments). Our primary collection risks relate to patient responsibility amounts and claims reviews conducted by MACs. Patient responsibility amounts include accounts for which the patient was the primary payor or the primary insurance carrier has paid the amounts covered by the applicable agreement, but patient co-payment amounts remain outstanding. Changes in the economy, such as increased unemployment rates or periods of recession, can further exacerbate our ability to collect patient responsibility amounts. For several years, under programs designated as “widespread probes,” certain of our MACs have conducted claims reviews of our billings and have denied payment for certain diagnosis codes. The majority of the denials we have encountered in these probes derive from two of our MACs and relate to determinations regarding medical necessity and provision of therapy services. We dispute, or “appeal,” most of these denials, and for claims we choose to take to administrative law judge hearings, we have historically experienced a success rate of approximately 70% . The resolution of these disputes can take in excess of three years, and we cannot provide assurance as to our ongoing and future success of these disputes. As such, we make provisions against these receivables in accordance with our accounting policy that necessarily considers historical collection trends of the receivables in this review process as part of our Provision for doubtful accounts . Because we do not write-off receivables until all collection efforts have been exhausted, we do not write off receivables related to denied claims while they are in this review process. When the amount collected related to denied claims differs from the net amount previously recorded, these collection differences are recorded in the Provision for doubtful accounts . As a result, the timing of these denials by MACs and their subsequent collection can create volatility in our Provision for doubtful accounts . If actual results are not consistent with our assumptions and judgments, we may be exposed to gains or losses that could be material. Changes in general economic conditions, business office operations, payor mix, or trends in federal or state governmental and private employer healthcare coverage could affect our collection of accounts receivable, financial position, results of operations, and cash flows. |
Property and Equipment | Property and Equipment— We report land, buildings, improvements, vehicles, and equipment at cost, net of accumulated depreciation and amortization and any asset impairments. We report assets under capital lease obligations at the lower of fair value or the present value of the aggregate future minimum lease payments at the beginning of the lease term. We depreciate our assets using the straight-line method over the shorter of the estimated useful life of the assets or life of the lease term, excluding any lease renewals, unless the lease renewals are reasonably assured. Useful lives are generally as follows: Years Buildings 10 to 30 Leasehold improvements 2 to 15 Vehicles 5 Furniture, fixtures, and equipment 3 to 10 Assets under capital lease obligations: Real estate 15 to 25 Vehicles 3 Equipment 3 to 5 Maintenance and repairs of property and equipment are expensed as incurred. We capitalize replacements and betterments that increase the estimated useful life of an asset. We capitalize pre-acquisition costs when they are directly identifiable with a specific property, the costs would be capitalizable if the property were already acquired, and acquisition of the property is probable. We capitalize interest expense on major construction and development projects while in progress. We retain fully depreciated assets in property and accumulated depreciation accounts until we remove them from service. In the case of sale, retirement, or disposal, the asset cost and related accumulated depreciation balances are removed from the respective accounts, and the resulting net amount, less any proceeds, is included as a component of income from continuing operations in the consolidated statements of operations. However, if the sale, retirement, or disposal involves a discontinued operation, the resulting net amount, less any proceeds, is included in the results of discontinued operations. We account for operating leases by recognizing rents, including any rent holidays, on a straight-line basis over the term of the lease. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets— We are required to test our goodwill and indefinite-lived intangible asset for impairment at least annually, absent some triggering event that would accelerate an impairment assessment. Absent any impairment indicators, we perform this impairment testing as of October 1st of each year. We recognize an impairment charge for any amount by which the carrying amount of the asset exceeds its implied fair value. We present an impairment charge as a separate line item within income from continuing operations in the consolidated statements of operations, unless the impairment is associated with a discontinued operation. In that case, we include the impairment charge, on a net-of-tax basis, within the results of discontinued operations. We assess qualitative factors in our inpatient rehabilitation and home health and hospice reporting units to determine whether it is necessary to perform the first step of the two-step quantitative impairment test. If, based on this qualitative assessment, we were to believe we must proceed to Step 1, we would determine the fair value of our reporting units using generally accepted valuation techniques including the income approach and the market approach. The income approach includes the use of each reporting unit’s discounted projected operating results and cash flows. This approach includes many assumptions related to pricing and volume, operating expenses, capital expenditures, discount factors, tax rates, etc. Changes in economic and operating conditions impacting these assumptions could result in goodwill impairment in future periods. We reconcile the estimated fair value of our reporting units to our market capitalization. When we dispose of a hospital or home health or hospice agency, goodwill is allocated to the gain or loss on disposition using the relative fair value methodology. We assess qualitative factors related to our indefinite-lived intangible asset to determine whether it is necessary to perform the first step of the two-step quantitative impairment test. If, based on this qualitative assessment, we were to believe we must proceed to Step 1, we would determine the fair value of our indefinite-lived intangible asset using generally accepted valuation techniques including the relief-from-royalty method. This method is a form of the income approach in which value is equated to a series of cash flows and discounted at a risk-adjusted rate. It is based on a hypothetical royalty, calculated as a percentage of forecasted revenue, that we would otherwise be willing to pay to use the asset, assuming it were not already owned. This approach includes assumptions related to pricing and volume, as well as a royalty rate a hypothetical third party would be willing to pay for use of the asset. When making our royalty rate assumption, we consider rates paid in arms-length licensing transactions for assets comparable to our asset. We amortize the cost of intangible assets with finite useful lives over their respective estimated useful lives to their estimated residual value. As of December 31, 2017 , none of our finite useful lived intangible assets has an estimated residual value. We also review these assets for impairment whenever events or changes in circumstances indicate we may not be able to recover the asset’s carrying amount. The range of estimated useful lives and the amortization basis for our intangible assets, excluding goodwill, are generally as follows: Estimated Useful Life and Amortization Basis Certificates of need 10 to 30 years using straight-line basis Licenses 10 to 20 years using straight-line basis Noncompete agreements 1 to 18 years using straight-line basis Trade names: Encompass indefinite-lived asset All other 1 to 20 years using straight-line basis Internal-use software 3 to 7 years using straight-line basis Market access assets 20 years using accelerated basis We capitalize the costs of obtaining or developing internal-use software, including external direct costs of material and services and directly related payroll costs. Amortization begins when the internal-use software is ready for its intended use. Costs incurred during the preliminary project and post-implementation stages, as well as maintenance and training costs, are expensed as incurred. Our market access assets are valued using discounted cash flows under the income approach. The value of the market access assets is attributable to our ability to gain access to and penetrate an acquired facility’s historical market patient base. To determine this value, we first develop a debt-free net cash flow forecast under various patient volume scenarios. The debt-free net cash flow is then discounted back to present value using a discount factor, which includes an adjustment for company-specific risk. As noted in the above table, we amortize these assets over 20 years using an accelerated basis that reflects the pattern in which we believe the economic benefits of the market access will be consumed. |
Impairment of Long-Lived Assets and Other Intangible Assets | Impairment of Long-Lived Assets and Other Intangible Assets— We assess the recoverability of long-lived assets (excluding goodwill and our indefinite-lived asset) and identifiable acquired intangible assets with finite useful lives, whenever events or changes in circumstances indicate we may not be able to recover the asset’s carrying amount. We measure the recoverability of assets to be held and used by a comparison of the carrying amount of the asset to the expected net future cash flows to be generated by that asset, or, for identifiable intangibles with finite useful lives, by determining whether the amortization of the intangible asset balance over its remaining life can be recovered through undiscounted future cash flows. The amount of impairment of identifiable intangible assets with finite useful lives, if any, to be recognized is measured based on projected discounted future cash flows. We measure the amount of impairment of other long-lived assets (excluding goodwill) as the amount by which the carrying value of the asset exceeds the fair market value of the asset, which is generally determined based on projected discounted future cash flows or appraised values. We classify long-lived assets to be disposed of other than by sale as held and used until they are disposed. We report long-lived assets to be disposed of by sale as held for sale and recognize those assets in the balance sheet at the lower of carrying amount or fair value less cost to sell, and we cease depreciation. |
Investments in and Advances to Nonconsolidated Affiliates | Investments in and Advances to Nonconsolidated Affiliates— Investments in entities we do not control but in which we have the ability to exercise significant influence over the operating and financial policies of the investee are accounted for under the equity method. Equity method investments are recorded at original cost and adjusted periodically to recognize our proportionate share of the investees’ net income or losses after the date of investment, additional contributions made, dividends or distributions received, and impairment losses resulting from adjustments to net realizable value. We record equity method losses in excess of the carrying amount of an investment when we guarantee obligations or we are otherwise committed to provide further financial support to the affiliate. We use the cost method to account for equity investments for which the equity securities do not have readily determinable fair values and for which we do not have the ability to exercise significant influence. Under the cost method of accounting, private equity investments are carried at cost and are adjusted only for other-than-temporary declines in fair value, additional investments, or distributions deemed to be a return of capital. Management periodically assesses the recoverability of our equity method and cost method investments and equity method goodwill for impairment. We consider all available information, including the recoverability of the investment, the earnings and near-term prospects of the affiliate, factors related to the industry, conditions of the affiliate, and our ability, if any, to influence the management of the affiliate. We assess fair value based on valuation methodologies, as appropriate, including discounted cash flows, estimates of sales proceeds, and external appraisals, as appropriate. If an investment or equity method goodwill is considered to be impaired and the decline in value is other than temporary, we record an appropriate write-down. |
Financing Costs | Financing Costs— We amortize financing costs using the effective interest method over the expected life of the related debt. Excluding financing costs related to our revolving line of credit (which is included in Other long-term assets ), financing costs are presented as a direct deduction from the face amount of the financings. The related expense is included in Interest expense and amortization of debt discounts and fees in our consolidated statements of operations. We accrete discounts and amortize premiums using the effective interest method over the expected life of the related debt, and we report discounts or premiums as a direct deduction from, or addition to, the face amount of the financing. The related income or expense is included in Interest expense and amortization of debt discounts and fees in our consolidated statements of operations. |
Fair Value Measurements | Fair Value Measurements— Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions market participants would use in pricing an asset or liability. The basis for these assumptions establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: • Level 1 – Observable inputs such as quoted prices in active markets; • Level 2 – Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and • Level 3 – Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. Assets and liabilities measured at fair value are based on one or more of three valuation techniques. The three valuation techniques are as follows: • Market approach – Prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities; • Cost approach – Amount that would be required to replace the service capacity of an asset (i.e., replacement cost); and • Income approach – Techniques to convert future cash flows to a single present amount based on market expectations (including present value techniques, option-pricing models, and lattice models). Our financial instruments consist mainly of cash and cash equivalents, restricted cash, restricted marketable securities, accounts receivable, accounts payable, letters of credit, and long-term debt. The carrying amounts of cash and cash equivalents, restricted cash, accounts receivable, and accounts payable approximate fair value because of the short-term maturity of these instruments. The fair value of our letters of credit is deemed to be the amount of payment guaranteed on our behalf by third-party financial institutions. We determine the fair value of our long-term debt using quoted market prices, when available, or discounted cash flows based on various factors, including maturity schedules, call features, and current market rates. On a recurring basis, we are required to measure our available-for-sale restricted marketable securities at fair value. The fair values of our available-for-sale restricted marketable securities are determined based on quoted market prices in active markets or quoted prices, dealer quotations, or alternative pricing sources supported by observable inputs in markets that are not considered to be active. On a nonrecurring basis, we are required to measure property and equipment, goodwill, other intangible assets, investments in nonconsolidated affiliates, and assets and liabilities of discontinued operations at fair value. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges or similar adjustments made to the carrying value of the applicable assets. The fair value of our property and equipment is determined using discounted cash flows and significant unobservable inputs, unless there is an offer to purchase such assets, which could be the basis for determining fair value. The fair value of our intangible assets, excluding goodwill, is determined using discounted cash flows and significant unobservable inputs. The fair value of our investments in nonconsolidated affiliates is determined using quoted prices in private markets, discounted cash flows or earnings, or market multiples derived from a set of comparables. The fair value of our assets and liabilities of discontinued operations is determined using discounted cash flows and significant unobservable inputs unless there is an offer to purchase such assets and liabilities, which would be the basis for determining fair value. The fair value of our goodwill is determined using discounted projected operating results and cash flows, which involve significant unobservable inputs. See also the “Redeemable Noncontrolling Interests” section of this note. |
Noncontrolling Interests in Consolidated Affiliates | Noncontrolling Interests in Consolidated Affiliates— The consolidated financial statements include all assets, liabilities, revenues, and expenses of less-than-100%-owned affiliates we control. Accordingly, we have recorded noncontrolling interests in the earnings and equity of such entities. We record adjustments to noncontrolling interests for the allocable portion of income or loss to which the noncontrolling interests holders are entitled based upon their portion of the subsidiaries they own. Distributions to holders of noncontrolling interests are adjusted to the respective noncontrolling interests holders’ balance. Redeemable Noncontrolling Interests— Certain of our joint venture agreements contain provisions that allow our partners to require us to purchase their interests in the joint venture at fair value at certain points in the future. Likewise, certain members of the home health and hospice management team hold similar put rights regarding their interests in our home health and hospice business, as discussed in Note 11, Redeemable Noncontrolling Interests . Because these noncontrolling interests provide for redemption features that are not solely within our control, we classify them as Redeemable noncontrolling interests outside of permanent equity in our consolidated balance sheets. At the end of each reporting period, we compare the carrying value of the Redeemable noncontrolling interests to their estimated redemption value. If the estimated redemption value is greater than the current carrying value, the carrying value is adjusted to the estimated redemption value, with the adjustments recorded through equity in the line item Capital in excess of par value . The fair value of the Redeemable noncontrolling interests related to our home health segment is determined using the product of a 12-month specified performance measure and a specified median market price multiple based on a basket of public health companies. The fair value of our Redeemable noncontrolling interests in our joint venture hospitals is determined primarily using the income approach. The income approach includes the use of the hospital’s projected operating results and cash flows discounted using a rate that reflects market participant assumptions for the applicable hospitals, or Level 3 inputs. The projected operating results use management’s best estimates of economic and market conditions over the forecasted periods including assumptions for pricing and volume, operating expenses, and capital expenditures. |
Convertible Perpetual Preferred Stock | Convertible Perpetual Preferred Stock— Our Convertible perpetual preferred stock contained fundamental change provisions that allowed the holder to require us to redeem the preferred stock for cash if certain events occurred. As redemption under these provisions was not solely within our control, we classified our Convertible perpetual preferred stock as temporary equity. |
Share-Based Payments | Share-Based Payments— Encompass Health has shareholder-approved stock-based compensation plans that provide for the granting of stock-based compensation to certain employees and directors. All share-based payments to employees, excluding stock appreciation rights (“SARs”), are recognized in the financial statements based on their estimated grant-date fair value and amortized on a straight-line basis over the applicable requisite service period. Share-based payments to employees in the form of SARs are recognized in the financial statements based on their current fair value and expensed ratably over the applicable service period. |
Litigation Reserves | Litigation Reserves— We accrue for loss contingencies associated with outstanding litigation for which management has determined it is probable a loss contingency exists and the amount of loss can be reasonably estimated. If the accrued amount associated with a loss contingency is greater than $5.0 million , we also accrue estimated future legal fees associated with the loss contingency. This requires management to estimate the amount of legal fees that will be incurred in the defense of the litigation. These estimates are based on our expectations of the scope, length to complete, and complexity of the claims. In the future, additional adjustments may be recorded as the scope, length to complete, or complexity of outstanding litigation changes. |
Advertising Costs | Advertising Costs— We expense costs of print, radio, television, and other advertisements as incurred. Advertising expenses, primarily included in Other operating expenses within the accompanying consolidated statements of operations, were $6.3 million , $7.5 million , and $7.3 million in each of the years ended December 31, 2017 , 2016 , and 2015 , respectively. |
Professional Fees - Accounting, Tax, and Legal | Professional Fees—Accounting, Tax, and Legal— In 2016 and 2015 , Professional fees—accounting, tax, and legal related primarily to legal and consulting fees for continued litigation and support matters discussed in Note 17, Contingencies and Other Commitments . |
Income Taxes | Income Taxes— We provide for income taxes using the asset and liability method . This approach recognizes the amount of income taxes payable or refundable for the current year, as well as deferred tax assets and liabilities for the future tax consequence of events recognized in the consolidated financial statements and income tax returns. Deferred income tax assets and liabilities are adjusted to recognize the effects of changes in tax laws or enacted tax rates. A valuation allowance is required when it is more likely than not some portion of the deferred tax assets will not be realized. Realization is dependent on generating sufficient future taxable income in the applicable tax jurisdiction. On a quarterly basis, we assess the likelihood of realization of our deferred tax assets considering all available evidence, both positive and negative. Our most recent operating performance, the scheduled reversal of temporary differences, our forecast of taxable income in future periods by jurisdiction, our ability to sustain a core level of earnings, and the availability of prudent tax planning strategies are important considerations in our assessment. We evaluate our tax positions and establish assets and liabilities in accordance with the applicable accounting guidance on uncertainty in income taxes. We review these tax uncertainties in light of changing facts and circumstances, such as the progress of tax audits, and adjust them accordingly. We have used the with-and-without method to determine when we will recognize excess tax benefits from stock-based compensation. Under this method in 2016, we recognized these excess tax benefits only after we fully realized the tax benefits of net operating losses. Encompass Health and its corporate subsidiaries file a consolidated federal income tax return. Some subsidiaries consolidated for financial reporting purposes are not part of the consolidated group for federal income tax purposes and file separate federal income tax returns. State income tax returns are filed on a separate, combined, or consolidated basis in accordance with relevant state laws and regulations. Partnerships, limited liability companies, and other pass-through entities we consolidate or account for using the equity method of accounting file separate federal and state income tax returns. We include the allocable portion of each pass-through entity’s income or loss in our federal income tax return. We allocate the remaining income or loss of each pass-through entity to the other partners or members who are responsible for their portion of the taxes. |
Assets and Liabilities in and Results of Discontinued Operations | Assets and Liabilities in and Results of Discontinued Operations— Effective January 1, 2015, in connection with a new standard issued by the FASB, we changed our criteria for determining which disposals are presented as discontinued operations. Historically, any component that had been disposed of or was classified as held for sale qualified for discontinued operations reporting unless there was significant continuing involvement with the disposed component or continuing cash flows. In contrast, we now report the disposal of the component, or group of components, as discontinued operations only when it represents a strategic shift that has, or will have, a major effect on our operations and financial results. As a result, the sale or disposal of a single Encompass Health facility or location no longer qualifies as a discontinued operation. This accounting change was made prospectively. No new components were recognized as discontinued operations during 2015, 2016, or 2017. In the period a component of an entity has been disposed of or classified as held for sale, we reclassify the results of operations for current and prior periods into a single caption titled (Loss) income from discontinued operations, net of tax . In addition, we classify the assets and liabilities of those components as current and noncurrent assets and liabilities within Prepaid expenses and other current assets , Other long-term assets , Other current liabilities , and Other long-term liabilities in our consolidated balance sheets. We also classify cash flows related to discontinued operations as one line item within each category of cash flows in our consolidated statements of cash flows. |
Earnings per Common Share | Earnings per Common Share— The calculation of earnings per common share is based on the weighted-average number of our common shares outstanding during the applicable period. The calculation for diluted earnings per common share recognizes the effect of all potential dilutive common shares, including warrants, that were outstanding during the respective periods, unless their impact would be antidilutive. The calculation of earnings per common share also considers the effect of participating securities. Stock-based compensation awards that contain nonforfeitable rights to dividends and dividend equivalents, such as our nonvested restricted stock awards granted before 2014 and restricted stock units, are considered participating securities and are included in the computation of earnings per common share pursuant to the two-class method. In applying the two-class method, earnings are allocated to both common stock shares and participating securities based on their respective weighted-average shares outstanding for the period. We use the if-converted method to include our convertible senior subordinated notes in our computation of diluted earnings per share. All other potential dilutive shares, including warrants, are included in our weighted-average diluted share count using the treasury stock method. |
Treasury Stock | Treasury Stock— Shares of common stock repurchased by us are recorded at cost as treasury stock. When shares are reissued, we use an average cost method to determine cost. The difference between the cost of the shares and the re-issuance price is added to or deducted from Capital in excess of par value . We account for the retirement of treasury stock as a reduction of retained earnings. However, due to our Accumulated deficit , the retirement of treasury stock is currently recorded as a reduction of Capital in excess of par value . |
Comprehensive Income | Comprehensive Income— Comprehensive income is comprised of Net income and changes in unrealized gains or losses on available-for-sale securities and is included in the consolidated statements of comprehensive income. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements — In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers” and has subsequently issued supplemental and/or clarifying ASUs (collectively “ASC 606”). ASC 606 outlines a five-step framework that supersedes the principles for recognizing revenue and eliminate industry-specific guidance. In addition, ASC 606 revises current disclosure requirements in an effort to help financial statement users better understand the nature, amount, timing, and uncertainty of revenue that is recognized. ASC 606 is effective for our annual reporting period beginning on January 1, 2018, including interim periods within that year. ASC 606 may be applied retrospectively to each period presented or on a modified retrospective basis with the cumulative effect recognized as of the date of adoption. We have substantially completed our assessment of the impact this guidance may have on our consolidated financial statements by analyzing our current portfolio of third-party payor contracts, including a review of historical accounting policies and practices to identify potential differences in applying the new guidance. Our assessment also includes evaluating the nature and amount of data available to us for the implementation of ASC 606. Under ASC 606, all amounts we previously presented as Provision for doubtful accounts will be considered an implicit price concession in determining Net operating revenues . As a result of adopting ASC 606 on January 1, 2018 using the full retrospective transition method, we estimate the following impact to our consolidated statements of operations (in millions): For the Year Ended December 31, 2017 For the Year Ended December 31, 2016 As Reported Adjustment for ASC 606 Recasted As Reported Adjustment for ASC 606 Recasted Net operating revenues $ 3,971.4 $ (52.4 ) $ 3,919.0 $ 3,707.2 $ (61.2 ) $ 3,646.0 Provision for doubtful accounts $ 52.4 $ (52.4 ) $ — $ 61.2 $ (61.2 ) $ — Net income attributable to Encompass Health $ 256.3 $ — $ 256.3 $ 247.6 $ — $ 247.6 In addition, the adoption of ASC 606 will result in increased disclosure, including qualitative and quantitative disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Except for the adjustments discussed above, we do not expect the adoption of ASC 606 to have a material impact on our consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments - Overall (Topic 825): Recognition and Measurement of Financial Assets and Financial Liabilities.” This standard revises the classification and measurement of investments in certain equity investments and the presentation of certain fair value changes for certain financial liabilities measured at fair value. This revised standard requires the change in fair value of many equity investments to be recognized in Net income . This revised standard requires a modified retrospective application with a cumulative effect adjustment recognized in retained earnings as of the date of adoption and is effective for our interim and annual periods beginning January 1, 2018. During the first quarter of 2018, we will recognize mark-to-market gains and losses associated with our available-for-sale equity securities through Net income instead of Accumulated other comprehensive income . We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” in order to increase transparency and comparability by recognizing lease assets and liabilities on the balance sheet and disclosing key information about leasing arrangements. Under the new standard, lessees will recognize a right-of-use asset and a corresponding lease liability for all leases other than leases that meet the definition of a short-term lease. The liability will be equal to the present value of future minimum lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Operating leases will result in straight-line expense while finance leases will result in an expense pattern similar to current capital leases. Classification will be based on criteria that are similar to those applied in current lease accounting. This standard will be effective for our annual reporting period beginning on January 1, 2019. Early adoption is permitted. In transition, we will be required to recognize and measure leases beginning in the earliest period presented using a modified retrospective approach; therefore, we anticipate restating our consolidated financial statements for the two fiscal years prior to the year of adoption. While we are currently assessing the impact this guidance may have on our consolidated financial statements, we expect that virtually all of our existing operating leases will be reflected as right-of-use assets and liabilities on our consolidated balance sheets under the new standard. We do not expect to early adopt this standard. See Note 6, Property and Equipment , for disclosure related to our operating leases. In March 2016, the FASB issued ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting (Topic 718),” to simplify various aspects of share-based payment accounting and presentation. The new standard requires entities to record all of the tax effects related to share-based payments at settlement (or expiration) through the income statement. This change is required to be applied prospectively to all excess tax benefits and tax deficiencies resulting from settlements after the date of adoption of the ASU. The standard eliminates the requirement to delay recognition of a windfall tax benefit until it reduces current taxes payable. This change is required to be applied on a modified retrospective basis. In addition, all income tax-related cash flows resulting from share-based windfall tax benefits are required to be reported as operating activities on the statement of cash flows as opposed to the current presentation as an inflow from financing activities and an outflow from operating activities. Either prospective or retrospective transition of this provision is permitted. The standard also clarifies that all cash payments made to taxing authorities on the employees’ behalf for withheld shares should be presented as financing activities on the statement of cash flows on a retrospective basis. Finally, the standard allows entities to make an accounting policy election to either estimate forfeitures for each period or account for forfeitures as they occur. For Encompass Health, this guidance was effective for its annual reporting period beginning January 1, 2017, including interim periods within that reporting period. As a result of our adoption of this guidance effective January 1, 2017, we recorded $8.8 million of tax benefits in excess of compensation cost (“windfalls”) to Provision for income tax expense in our consolidating statement of operations for the year ended December 31, 2017 . In addition, we elected to retrospectively apply the guidance governing presentation of windfalls on the statement of cash flows, which resulted in a reclassification of windfalls of $17.3 million from Cash flows from financing activities to Cash flows from operating activities for the year ended December 31, 2016 . We also retrospectively applied the change to the presentation of cash payments made to taxing authorities on the employees’ behalf for withheld shares on our condensed consolidating statements of cash flows for the years ended December 31, 2016 and 2015, which resulted in a reclassification of $11.6 million and $17.2 million , respectively, outflows from Cash flows from operating activities to Cash flows from financing activities . We did not elect an accounting policy change to record forfeitures as they occur and thus will continue to estimate forfeitures at each period. Except for the adjustments discussed above, the adoption of this guidance did not have a material impact on our consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326),” which provides guidance for accounting for credit losses on financial instruments. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments and modifies the impairment model for available-for-sale debt securities. The new guidance is effective for Encompass Health for the annual period beginning January 1, 2020, including interim periods within that reporting period. Early adoption is permitted for Encompass Health beginning January 1, 2019. We continue to review the requirements of this standard and any potential impact it may have on our consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments,” to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. In addition, the standard clarifies when cash receipts and cash payments have aspects of more than one class of cash flows and cannot be separated, classification will depend on the predominant source or use. The new guidance requires retrospective application and is effective for Encompass Health for the annual reporting period beginning January 1, 2018, including interim periods within that reporting period. The clarification that debt prepayment premiums should be classified as financing activities will result in an immaterial increase in certain prior period operating cash inflows and a corresponding increase in financing cash outflows. In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230), Restricted Cash,” to clarify how entities should present restricted cash and restricted cash equivalents in the statement of cash flows. The new guidance requires amounts generally described as restricted cash and restricted cash equivalents be included with Cash and cash equivalents when reconciling the total beginning and ending amounts for the periods shown on the statement of cash flows. The new guidance requires retrospective application and is effective for our annual reporting period beginning January 1, 2018, including interim periods within that reporting period. The adoption of this guidance will result in an immaterial change to prior period investing cash flows. We do not believe any other recently issued, but not yet effective, accounting standards will have a material effect on our consolidated financial position, results of operations, or cash flows. |
Summary of Significant Accoun29
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Concentration of Net Operating Revenues and Net Patient Service Accounts Receivable by Payor and Payor Class | Our inpatient rehabilitation segment derived its Net operating revenues from the following payor sources: For the Year Ended December 31, 2017 2016 2015 Medicare 73.2 % 73.3 % 73.2 % Medicare Advantage 8.4 % 7.7 % 7.9 % Managed care 10.9 % 11.2 % 11.1 % Medicaid 3.1 % 3.0 % 2.5 % Other third-party payors 1.6 % 1.8 % 2.0 % Workers’ compensation 0.9 % 1.0 % 1.1 % Patients 0.6 % 0.6 % 0.7 % Other income 1.3 % 1.4 % 1.5 % Total 100.0 % 100.0 % 100.0 % Our home health and hospice segment derived its Net operating revenues from the following payor sources: For the Year Ended December 31, 2017 2016 2015 Medicare 85.1 % 82.9 % 83.7 % Medicare Advantage 9.7 % 8.7 % 7.7 % Managed care 3.8 % 3.9 % 3.0 % Medicaid 1.2 % 4.3 % 5.5 % Other third-party payors — % — % — % Workers’ compensation — % — % — % Patients 0.1 % 0.1 % 0.1 % Other income 0.1 % 0.1 % — % Total 100.0 % 100.0 % 100.0 % We derived consolidated Net operating revenues from the following payor sources: For the Year Ended December 31, 2017 2016 2015 Medicare 75.5 % 75.2 % 74.9 % Medicare Advantage 8.7 % 7.9 % 7.9 % Managed care 9.5 % 9.8 % 9.8 % Medicaid 2.7 % 3.2 % 3.0 % Other third-party payors 1.3 % 1.4 % 1.7 % Workers' compensation 0.7 % 0.8 % 0.9 % Patients 0.5 % 0.5 % 0.6 % Other income 1.1 % 1.2 % 1.2 % Total 100.0 % 100.0 % 100.0 % The concentration of net patient service accounts receivable by payor class, as a percentage of total net patient service accounts receivable, is as follows: As of December 31, 2017 2016 Medicare 75.1 % 73.0 % Managed care and other discount plans, including Medicare Advantage 17.4 % 18.5 % Medicaid 2.4 % 2.7 % Other third-party payors 2.9 % 3.3 % Workers' compensation 1.3 % 1.6 % Patients 0.9 % 0.9 % Total 100.0 % 100.0 % |
Useful Lives of Property and Equipment | Useful lives are generally as follows: Years Buildings 10 to 30 Leasehold improvements 2 to 15 Vehicles 5 Furniture, fixtures, and equipment 3 to 10 Assets under capital lease obligations: Real estate 15 to 25 Vehicles 3 Equipment 3 to 5 Property and equipment consists of the following (in millions): As of December 31, 2017 2016 Land $ 125.4 $ 125.3 Buildings 1,712.4 1,601.4 Leasehold improvements 138.1 115.2 Vehicles 16.2 11.8 Furniture, fixtures, and equipment 461.5 425.3 2,453.6 2,279.0 Less: Accumulated depreciation and amortization (1,097.8 ) (982.4 ) 1,355.8 1,296.6 Construction in progress 161.3 95.2 Property and equipment, net $ 1,517.1 $ 1,391.8 |
Estimated Useful Lives and Amortization Basis of Other Finite-lived Intangible Assets | The range of estimated useful lives and the amortization basis for our intangible assets, excluding goodwill, are generally as follows: Estimated Useful Life and Amortization Basis Certificates of need 10 to 30 years using straight-line basis Licenses 10 to 20 years using straight-line basis Noncompete agreements 1 to 18 years using straight-line basis Trade names: Encompass indefinite-lived asset All other 1 to 20 years using straight-line basis Internal-use software 3 to 7 years using straight-line basis Market access assets 20 years using accelerated basis The following table provides information regarding our other intangible assets (in millions): Gross Carrying Amount Accumulated Amortization Net Certificates of need: 2017 $ 113.7 $ (19.5 ) $ 94.2 2016 98.6 (12.9 ) 85.7 Licenses: 2017 $ 146.0 $ (71.6 ) $ 74.4 2016 142.0 (62.1 ) 79.9 Noncompete agreements: 2017 $ 63.5 $ (55.4 ) $ 8.1 2016 62.2 (47.3 ) 14.9 Trade name - Encompass: 2017 $ 135.2 $ — $ 135.2 2016 135.2 — 135.2 Trade names - all other: 2017 $ 35.1 $ (16.4 ) $ 18.7 2016 34.6 (13.9 ) 20.7 Internal-use software: 2017 $ 201.6 $ (132.3 ) $ 69.3 2016 181.4 (110.2 ) 71.2 Market access assets: 2017 $ 13.2 $ (10.0 ) $ 3.2 2016 13.2 (9.5 ) 3.7 Total intangible assets: 2017 $ 708.3 $ (305.2 ) $ 403.1 2016 667.2 (255.9 ) 411.3 |
Estimated Basis of Other Indefinite-lived Intangible Assets | The range of estimated useful lives and the amortization basis for our intangible assets, excluding goodwill, are generally as follows: Estimated Useful Life and Amortization Basis Certificates of need 10 to 30 years using straight-line basis Licenses 10 to 20 years using straight-line basis Noncompete agreements 1 to 18 years using straight-line basis Trade names: Encompass indefinite-lived asset All other 1 to 20 years using straight-line basis Internal-use software 3 to 7 years using straight-line basis Market access assets 20 years using accelerated basis |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | As a result of adopting ASC 606 on January 1, 2018 using the full retrospective transition method, we estimate the following impact to our consolidated statements of operations (in millions): For the Year Ended December 31, 2017 For the Year Ended December 31, 2016 As Reported Adjustment for ASC 606 Recasted As Reported Adjustment for ASC 606 Recasted Net operating revenues $ 3,971.4 $ (52.4 ) $ 3,919.0 $ 3,707.2 $ (61.2 ) $ 3,646.0 Provision for doubtful accounts $ 52.4 $ (52.4 ) $ — $ 61.2 $ (61.2 ) $ — Net income attributable to Encompass Health $ 256.3 $ — $ 256.3 $ 247.6 $ — $ 247.6 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Business Combinations [Abstract] | |||
Schedule of Assets Acquired and Liabilities Assumed at the Acquisition Date | The fair value of the assets acquired at the acquisition date were as follows (in millions): Property and equipment $ 0.1 Identifiable intangible assets: Noncompete agreements (useful lives of 2 to 3 years) 0.6 Trade name (useful life of 20 years) 0.5 Certificate of need (useful life of 20 years) 9.8 Goodwill 24.0 Total assets acquired $ 35.0 The fair value of the assets acquired and liabilities assumed at the acquisition date were as follows (in millions): Total current assets $ 0.1 Identifiable intangible asset: Noncompete agreements (useful lives of 5 years) 0.8 Trade name (useful life of 1 year) 0.1 Certificates of need (useful lives of 10 years) 1.8 Licenses (useful lives of 10 years) 4.0 Goodwill 21.4 Total assets acquired 28.2 Total liabilities assumed (0.3 ) Net assets acquired $ 27.9 | The fair value of the assets acquired at the acquisition date were as follows (in millions): Property and equipment $ 5.3 Identifiable intangible assets: Noncompete agreements (useful lives of 1 to 3 years) 0.4 Trade names (useful lives of 20 years) 1.0 Goodwill 9.4 Total assets acquired $ 16.1 The fair value of the assets acquired and liabilities assumed at the acquisition date were as follows (in millions): Identifiable intangible asset: Noncompete agreements (useful lives of 5 years) $ 1.1 Trade names (useful lives of 1 year) 0.7 Certificate of needs (useful lives of 10 years) 1.9 Licenses (useful lives of 10 years) 3.4 Goodwill 41.4 Total assets acquired 48.5 Total liabilities assumed (0.4 ) Net assets acquired $ 48.1 | The fair value of the assets acquired and liabilities assumed at the acquisition dates for the other inpatient rehabilitation transactions completed in 2015 were as follows (in millions): Total current assets $ 10.1 Property and equipment 42.7 Identifiable intangible assets: Noncompete agreements (useful lives of 2 to 3 years) 0.1 Trade names (useful lives of 20 years) 0.8 Certificates of need (useful lives of 20 years) 8.8 Licenses (useful lives of 20 years) 0.2 Goodwill 0.7 Total assets acquired 63.4 Total liabilities assumed (2.7 ) Net assets acquired $ 60.7 The fair value of the assets acquired and liabilities assumed at the acquisition date for CareSouth were as follows (in millions): Cash and cash equivalents $ 0.4 Accounts receivable 10.5 Prepaid expenses and other current assets 2.0 Property and equipment 0.7 Identifiable intangible assets: Noncompete agreements (useful lives of 3 years) 0.8 Trade name (useful life of 5 years) 2.8 Certificates of need (useful lives of 10 years) 15.6 Licenses (useful lives of 10 years) 13.0 Internal-use software 0.4 Goodwill 143.3 Investment in nonconsolidated subsidiaries 2.2 Total assets acquired 191.7 Liabilities assumed: Current portion of long-term debt 0.1 Accounts payable 2.7 Accrued payroll 2.4 Other current liabilities 2.8 Long-term debt, net of current portion 0.2 Deferred tax liabilties 9.5 Total liabilities assumed 17.7 Noncontrolling interests 4.3 Net assets acquired $ 169.7 The fair value of the assets acquired and liabilities assumed at the acquisition dates for the other home health and hospice transactions completed in 2015 were as follows (in millions): Property and equipment $ 0.1 Identifiable intangible assets: Noncompete agreements (useful lives of 2 to 5 years) 1.3 Trade names (useful lives of 1 year) 0.5 Certificates of need (useful lives of 10 years) 4.9 Licenses (useful lives of 10 years) 3.6 Goodwill 20.3 Total assets acquired 30.7 Total liabilities assumed (0.2 ) Net assets acquired $ 30.5 The fair value of the assets acquired and liabilities assumed at the acquisition date for Reliant were as follows (in millions): Cash and cash equivalents $ 42.6 Accounts receivable 25.7 Prepaid expenses and other current assets 2.8 Property and equipment 220.6 Identifiable intangible assets: Noncompete agreements (useful lives of 1 to 2 years) 9.7 Trade names (useful lives of 20 years) 8.9 Certificates of need (useful lives of 20 years) 36.6 Licenses (useful lives of 20 years) 11.4 Goodwill 642.6 Other long-term assets 0.9 Total assets acquired 1,001.8 Liabilities assumed: Current portion of long-term debt 4.1 Accounts payable 1.7 Accrued payroll 3.7 Other current liabilities 10.8 Long-term debt, net of current portion 205.8 Deferred tax liabilities 3.9 Total liabilities assumed 230.0 Noncontrolling interests 0.4 Net assets acquired $ 771.4 |
Schedule of Noncash or Part Noncash Acquisitions | Information regarding the net cash paid for the inpatient rehabilitation acquisitions during 2017 is as follows (in millions): Fair value of assets acquired $ 11.0 Goodwill 24.0 Fair value of noncontrolling interest owned by joint venture partner (24.1 ) Net cash paid for acquisition $ 10.9 Information regarding the net cash paid for the home health acquisitions during 2017 is as follows (in millions): Fair value of assets acquired $ 6.8 Goodwill 21.4 Fair value of liabilities assumed (0.3 ) Net cash paid for acquisitions $ 27.9 | Information regarding the net cash paid for all inpatient rehabilitation acquisitions during 2016 is as follows (in millions): Fair value of assets acquired $ 6.7 Goodwill 9.4 Fair value of noncontrolling interest owned by joint venture partner (16.1 ) Net cash paid for acquisition $ — Information regarding the net cash paid for home health and hospice acquisitions during 2016 is as follows (in millions): Fair value of assets acquired $ 7.1 Goodwill 41.4 Fair value of liabilities assumed (0.4 ) Net cash paid for acquisitions $ 48.1 | Information regarding the net cash paid for the acquisition of Reliant is as follows (in millions): Fair value of assets acquired, net of $42.6 million of cash acquired $ 316.6 Goodwill 642.6 Fair value of liabilities assumed (230.0 ) Noncontrolling interests (0.4 ) Net cash paid for acquisition $ 728.8 Information regarding the net cash paid for other inpatient rehabilitation acquisitions during 2015 is as follows (in millions): Fair value of assets acquired $ 62.8 Goodwill 0.7 Fair value of liabilities assumed (2.7 ) Fair value of noncontrolling interest owned by joint venture partner (4.2 ) Net cash paid for acquisitions $ 56.6 Information regarding the net cash paid for the acquisition of CareSouth is as follows (in millions): Fair value of assets acquired, net of $0.4 million of cash acquired $ 48.0 Goodwill 143.3 Fair value of liabilities assumed (17.7 ) Fair value of noncontrolling interest owned by joint venture partner (4.3 ) Net cash paid for acquisitions $ 169.3 Information regarding the net cash paid for the other home health and hospice acquisitions during 2015 is as follows (in millions): Fair value of assets acquired $ 10.4 Goodwill 20.3 Fair value of liabilities assumed (0.2 ) Net cash paid for acquisitions $ 30.5 |
Summary of Actual and Pro Forma Results of Operations for Acquisitions | The following table summarizes the results of operations of the above mentioned acquisitions from their respective dates of acquisition included in our consolidated results of operations and the unaudited pro forma results of operations of the combined entity had the date of the acquisitions been January 1, 2016 (in millions): Net Operating Revenues Net (Loss) Income Attributable to Encompass Health Acquired entities only: Actual from acquisition date to December 31, 2017 $ 32.9 $ (6.3 ) Combined entity: Supplemental pro forma from 01/01/2017-12/31/2017 (unaudited) 3,996.1 260.3 Combined entity: Supplemental pro forma from 01/01/2016-12/31/2016 (unaudited) 3,771.5 254.8 | The following table summarizes the results of operations of the above mentioned inpatient rehabilitation hospitals and home health and hospice agencies from their respective dates of acquisition included in our consolidated results of operations and the unaudited pro forma results of operations of the combined entity had the date of the acquisitions been January 1, 2015 (in millions): Net Operating Revenues Net (Loss) Income Attributable to Encompass Health Acquired entities only: Actual from acquisition date to December 31, 2016 $ 27.4 $ (2.2 ) Combined entity: Supplemental pro forma from 1/01/2016-12/31/2016 (unaudited) 3,745.6 252.2 Combined entity: Supplemental pro forma from 1/01/2015-12/31/2015 (unaudited) 3,217.1 187.3 | The following table summarizes the results of operations of the above mentioned transactions from their respective dates of acquisition included in our consolidated results of operations and the unaudited pro forma results of operations of the combined entity had the date of the acquisitions been January 1, 2014 (in millions): Net Operating Revenues Net Income Acquired entities only: Actual from acquisition date to December 31, 2015: Reliant $ 63.7 $ 11.2 All Other Inpatient 54.7 1.7 CareSouth 19.2 2.5 All Other Home Health and Hospice 17.8 1.2 Combined entity: Supplemental pro forma from 1/01/2015-12/31/2015 (unaudited) 3,479.9 234.0 Combined entity: Supplemental pro forma from 1/01/2014-12/31/2014 (unaudited) 2,851.0 276.9 |
Cash and Marketable Securities
Cash and Marketable Securities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Investment Components | The components of our investments as of December 31, 2017 are as follows (in millions): Cash & Cash Equivalents Restricted Cash Restricted Marketable Securities Total Cash $ 54.4 $ 62.4 $ — $ 116.8 Equity securities — — 62.0 62.0 Total $ 54.4 $ 62.4 $ 62.0 $ 178.8 The components of our investments as of December 31, 2016 are as follows (in millions): Cash & Cash Equivalents Restricted Cash Restricted Marketable Securities Total Cash $ 40.5 $ 60.9 $ — $ 101.4 Equity securities — — 57.7 57.7 Total $ 40.5 $ 60.9 $ 57.7 $ 159.1 |
Schedule of Restricted Cash | As of December 31, 2017 and 2016 , Restricted cash consisted of the following (in millions): As of December 31, 2017 2016 Affiliate cash $ 18.1 $ 22.9 Self-insured captive funds 44.3 38.0 Total restricted cash $ 62.4 $ 60.9 |
Available-for-sale Securities Cost to Fair Value Reconciliation | A summary of our restricted marketable securities as of December 31, 2016 is as follows (in millions): Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Equity securities $ 59.6 $ 0.2 $ (2.1 ) $ 57.7 A summary of our restricted marketable securities as of December 31, 2017 is as follows (in millions): Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Equity securities $ 64.0 $ 0.3 $ (2.3 ) $ 62.0 |
Investment information related to restricted marketable securities | Investing information related to our restricted marketable securities is as follows (in millions): For the Year Ended December 31, 2017 2016 2015 Proceeds from sales of restricted available-for-sale securities $ 4.0 $ — $ — Proceeds from sales of nonrestricted available-for-sale securities $ — $ — $ 12.8 Gross realized gains $ — $ — $ 1.2 Gross realized losses $ — $ — $ — |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entities | The carrying amounts and classifications of the consolidated VIEs’ assets and liabilities, which are included in our consolidated balance sheet, are as follows (in millions): December 31, 2017 December 31, 2016 Assets Current assets: Cash and cash equivalents $ 1.2 $ 1.6 Restricted cash 3.5 3.8 Accounts receivable, net of allowance for doubtful accounts 32.6 30.8 Other current assets 2.1 2.0 Total current assets 39.4 38.2 Property and equipment, net 142.8 140.0 Goodwill 73.5 73.5 Intangible assets, net 7.7 9.6 Deferred income tax assets 0.7 0.6 Other long-term assets — 0.4 Total assets $ 264.1 $ 262.3 Liabilities Current liabilities: Current portion of long-term debt $ 1.8 $ 1.5 Accounts payable 6.5 6.8 Accrued payroll 7.1 6.6 Accrued interest payable 0.2 0.2 Other current liabilities 8.6 5.4 Total current liabilities 24.2 20.5 Long-term debt, net of current portion 28.3 29.8 Total liabilities $ 52.5 $ 50.3 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable | Accounts receivable consists of the following (in millions): As of December 31, 2017 2016 Current: Patient accounts receivable, net of allowance for doubtful accounts of $60.9 million in 2017; $53.9 million in 2016 $ 459.5 $ 432.0 Other accounts receivable 12.6 11.8 472.1 443.8 Noncurrent patient accounts receivable, net of allowance for doubtful accounts of $52.2 million in 2017; $49.5 million in 2016 129.1 125.9 Accounts receivable, net $ 601.2 $ 569.7 |
Schedule of Activity Related to Allowance for Doubtful Accounts | The following is the activity related to our allowance for doubtful accounts (in millions): For the Year Ended December 31, Balance at Beginning of Period Additions and Charges to Expense Deductions and Accounts Written Off Balance at End of Period 2017 $ 103.4 $ 52.4 $ (42.7 ) $ 113.1 2016 $ 71.6 $ 61.2 $ (29.4 ) $ 103.4 2015 $ 43.0 $ 47.2 $ (18.6 ) $ 71.6 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Components of Property and Equipment | Useful lives are generally as follows: Years Buildings 10 to 30 Leasehold improvements 2 to 15 Vehicles 5 Furniture, fixtures, and equipment 3 to 10 Assets under capital lease obligations: Real estate 15 to 25 Vehicles 3 Equipment 3 to 5 Property and equipment consists of the following (in millions): As of December 31, 2017 2016 Land $ 125.4 $ 125.3 Buildings 1,712.4 1,601.4 Leasehold improvements 138.1 115.2 Vehicles 16.2 11.8 Furniture, fixtures, and equipment 461.5 425.3 2,453.6 2,279.0 Less: Accumulated depreciation and amortization (1,097.8 ) (982.4 ) 1,355.8 1,296.6 Construction in progress 161.3 95.2 Property and equipment, net $ 1,517.1 $ 1,391.8 |
Fully Depreciated Assets and Assets Under Capital Lease Obligations | Information related to fully depreciated assets and assets under capital lease obligations is as follows (in millions): As of December 31, 2017 2016 Fully depreciated assets $ 318.6 $ 289.7 Assets under capital lease obligations: Buildings $ 329.6 $ 331.0 Vehicles 13.0 8.6 Equipment 0.3 0.3 342.9 339.9 Less: Accumulated amortization (104.6 ) (83.5 ) Assets under capital lease obligations, net $ 238.3 $ 256.4 |
Depreciation Expense, Amortization Expense Relating to Assets Under Capital Lease Obligations, Interest Capitalized, and Rent Expense Under Operating Leases | The amount of depreciation expense, amortization expense relating to assets under capital lease obligations, interest capitalized, and rent expense under operating leases is as follows (in millions): For the Year Ended December 31, 2017 2016 2015 Depreciation expense $ 111.8 $ 102.3 $ 91.0 Amortization expense $ 22.7 $ 21.8 $ 12.7 Interest capitalized $ 3.7 $ 2.0 $ 1.3 Rent expense: Minimum rent payments $ 66.5 $ 62.6 $ 48.8 Contingent and other rents 24.1 29.4 21.6 Other 8.9 4.0 3.8 Total rent expense $ 99.5 $ 96.0 $ 74.2 |
Schedule of Accrued Straight-Line Rent | The excess of cumulative rent expense (recognized on a straight-line basis) over cumulative rent payments made on leases with fixed escalation terms is recognized as straight-line rental accrual and is included in Other long-term liabilities in the accompanying consolidated balance sheets, as follows (in millions): As of December 31, 2017 2016 Straight-line rental accrual $ 11.2 $ 11.8 |
Schedule of Future Minimum Capital Lease Payments | Future minimum lease payments at December 31, 2017 , for those leases having an initial or remaining noncancelable lease term in excess of one year, are as follows (in millions): Year Ending December 31, Operating Leases Capital Lease Obligations Total 2018 $ 65.0 $ 36.4 $ 101.4 2019 59.5 33.2 92.7 2020 49.9 28.8 78.7 2021 39.7 28.4 68.1 2022 28.3 28.7 57.0 2023 and thereafter 159.3 327.7 487.0 $ 401.7 483.2 $ 884.9 Less: Interest portion (211.7 ) Obligations under capital leases $ 271.5 |
Schedule of Future Minimum Operating Lease Payments | Future minimum lease payments at December 31, 2017 , for those leases having an initial or remaining noncancelable lease term in excess of one year, are as follows (in millions): Year Ending December 31, Operating Leases Capital Lease Obligations Total 2018 $ 65.0 $ 36.4 $ 101.4 2019 59.5 33.2 92.7 2020 49.9 28.8 78.7 2021 39.7 28.4 68.1 2022 28.3 28.7 57.0 2023 and thereafter 159.3 327.7 487.0 $ 401.7 483.2 $ 884.9 Less: Interest portion (211.7 ) Obligations under capital leases $ 271.5 |
Goodwill and Other Intangible35
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in the Carrying Amount of Goodwill | The following table shows changes in the carrying amount of Goodwill for the years ended December 31, 2017 , 2016 , and 2015 (in millions): Inpatient Rehabilitation Home Health and Hospice Consolidated Goodwill as of December 31, 2014 $ 491.5 $ 592.5 $ 1,084.0 Acquisitions 641.6 164.5 806.1 Goodwill as of December 31, 2015 1,133.1 757.0 1,890.1 Acquisitions 8.9 42.5 51.4 Divestiture of pediatric home health services — (14.3 ) (14.3 ) Goodwill as of December 31, 2016 1,142.0 785.2 1,927.2 Acquisitions 24.0 21.4 45.4 Goodwill as of December 31, 2017 $ 1,166.0 $ 806.6 $ 1,972.6 |
Schedule of Intangible Assets by Major Class | The range of estimated useful lives and the amortization basis for our intangible assets, excluding goodwill, are generally as follows: Estimated Useful Life and Amortization Basis Certificates of need 10 to 30 years using straight-line basis Licenses 10 to 20 years using straight-line basis Noncompete agreements 1 to 18 years using straight-line basis Trade names: Encompass indefinite-lived asset All other 1 to 20 years using straight-line basis Internal-use software 3 to 7 years using straight-line basis Market access assets 20 years using accelerated basis The following table provides information regarding our other intangible assets (in millions): Gross Carrying Amount Accumulated Amortization Net Certificates of need: 2017 $ 113.7 $ (19.5 ) $ 94.2 2016 98.6 (12.9 ) 85.7 Licenses: 2017 $ 146.0 $ (71.6 ) $ 74.4 2016 142.0 (62.1 ) 79.9 Noncompete agreements: 2017 $ 63.5 $ (55.4 ) $ 8.1 2016 62.2 (47.3 ) 14.9 Trade name - Encompass: 2017 $ 135.2 $ — $ 135.2 2016 135.2 — 135.2 Trade names - all other: 2017 $ 35.1 $ (16.4 ) $ 18.7 2016 34.6 (13.9 ) 20.7 Internal-use software: 2017 $ 201.6 $ (132.3 ) $ 69.3 2016 181.4 (110.2 ) 71.2 Market access assets: 2017 $ 13.2 $ (10.0 ) $ 3.2 2016 13.2 (9.5 ) 3.7 Total intangible assets: 2017 $ 708.3 $ (305.2 ) $ 403.1 2016 667.2 (255.9 ) 411.3 |
Schedule of Amortization Expense, Intangible Assets | Amortization expense for other intangible assets is as follows (in millions): For the Year Ended December 31, 2017 2016 2015 Amortization expense $ 49.3 $ 48.5 $ 36.0 |
Schedule of Future Estimated Amortization Expense, Intangible Assets | Total estimated amortization expense for our other intangible assets for the next five years is as follows (in millions): Year Ending December 31, Estimated Amortization Expense 2018 $ 42.4 2019 37.2 2020 30.6 2021 26.1 2022 22.7 |
Investments in and Advances t36
Investments in and Advances to Nonconsolidated Affiliates (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |
Schedule of Aggregate Equity and Cost Method Investments | Our investments, which are included in Other long-term assets in our consolidated balance sheets, consist of the following (in millions): As of December 31, 2017 2016 Equity method investments: Capital contributions $ 0.9 $ 0.9 Cumulative share of income 105.3 97.8 Cumulative share of distributions (94.5 ) (86.0 ) 11.7 12.7 Cost method investments: Capital contributions, net of distributions and impairments 0.2 0.3 Total investments in and advances to nonconsolidated affiliates $ 11.9 $ 13.0 |
Schedule of Combined Assets, Liabilities, and Equity of Equity Method Affiliates | Condensed statements of operations (in millions): For the Year Ended December 31, 2017 2016 2015 Net operating revenues $ 40.9 $ 44.8 $ 36.5 Operating expenses (24.1 ) (24.3 ) (16.9 ) Income from continuing operations, net of tax 17.0 20.5 18.9 Net income 17.0 20.5 18.9 The following summarizes the combined assets, liabilities, and equity and the combined results of operations of our equity method affiliates (on a 100% basis, in millions): As of December 31, 2017 2016 Assets— Current $ 10.1 $ 13.1 Noncurrent 18.3 19.2 Total assets $ 28.4 $ 32.3 Liabilities and equity— Current liabilities $ 2.7 $ 2.7 Noncurrent liabilities 0.2 0.2 Partners’ capital and shareholders’ equity— Encompass Health 11.7 12.7 Outside partners 13.8 16.7 Total liabilities and equity $ 28.4 $ 32.3 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Outstanding Long-term Debt | Our notes payable consist of the following (in millions): As of December 31, 2017 2016 Interest Rates Sale/leaseback transactions involving real estate accounted for as financings $ 77.7 $ 48.2 7.5% to 11.2% Construction of a new hospital 4.4 7.4 LIBOR + 2.5%; Other 0.2 0.2 6.8% Other notes payable $ 82.3 $ 55.8 Our long-term debt outstanding consists of the following (in millions): As of December 31, 2017 2016 Credit Agreement— Advances under revolving credit facility $ 95.0 $ 152.0 Term loan facilities 294.7 421.2 Bonds payable— 5.125% Senior Notes due 2023 295.9 295.3 5.75% Senior Notes due 2024 1,193.9 1,193.2 5.75% Senior Notes due 2025 344.4 343.9 2.00% Convertible Senior Subordinated Notes due 2043 — 275.7 Other notes payable 82.3 55.8 Capital lease obligations 271.5 279.3 2,577.7 3,016.4 Less: Current portion (32.3 ) (37.1 ) Long-term debt, net of current portion $ 2,545.4 $ 2,979.3 |
Schedule of Debt Maturities | The following chart shows scheduled principal payments due on long-term debt for the next five years and thereafter (in millions): Year Ending December 31, Face Amount Net Amount 2018 $ 32.3 $ 32.3 2019 32.3 32.2 2020 25.2 25.2 2021 25.8 25.8 2022 356.1 354.5 Thereafter 2,123.4 2,107.7 Total $ 2,595.1 $ 2,577.7 |
Schedule of Redemption Prices for Senior Notes | We may redeem the 2025 Notes, in whole or in part, at any time on or after September 15, 2020, at the redemption prices set forth below: Period Redemption Price* 2020 102.875 % 2021 101.917 % 2022 100.958 % 2023 and thereafter 100.000 % * Expressed in percentage of principal amount We may redeem the 2023 Notes, in whole or in part, at any time on or after March 15, 2018 at the redemption prices set forth below: Period Redemption Price* 2018 103.844 % 2019 102.563 % 2020 101.281 % 2021 and thereafter 100.000 % * Expressed in percentage of principal amount We may redeem the 2024 Notes, in whole or in part, at any time on or after November 1, 2017, at the redemption prices set forth below: Period Redemption Price* 2017 102.875 % 2018 101.917 % 2019 100.958 % 2020 and thereafter 100.000 % * Expressed in percentage of principal amount |
Self-Insured Risks Self-Insured
Self-Insured Risks Self-Insured Risks (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Insurance [Abstract] | |
Self-Insurance Reserves | The following table presents the changes in our self-insurance reserves for the years ended December 31, 2017 , 2016 , and 2015 (in millions): 2017 2016 2015 Balance at beginning of period, gross $ 171.4 $ 142.1 $ 134.3 Less: Reinsurance receivables (41.4 ) (26.6 ) (26.0 ) Balance at beginning of period, net 130.0 115.5 108.3 Increase for the provision of current year claims 44.7 43.5 37.1 Decrease for the provision of prior year claims (3.0 ) (0.1 ) (4.6 ) Expenses related to discontinued operations (0.5 ) (0.4 ) (0.5 ) Payments related to current year claims (5.0 ) (5.0 ) (4.7 ) Payments related to prior year claims (35.1 ) (23.5 ) (22.5 ) Acquisitions — — 2.4 Balance at end of period, net 131.1 130.0 115.5 Add: Reinsurance receivables 39.9 41.4 26.6 Balance at end of period, gross $ 171.0 $ 171.4 $ 142.1 |
Redeemable Noncontrolling Int39
Redeemable Noncontrolling Interests (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interest | The following is a summary of the activity related to our Redeemable noncontrolling interests (in millions): For the Year Ended December 31, 2017 2016 2015 Balance at beginning of period $ 138.3 $ 121.1 $ 84.7 Net income attributable to noncontrolling interests 17.9 14.1 13.8 Distributions (4.6 ) (7.8 ) (7.3 ) Contribution to joint venture 2.3 — — Change in fair value 67.0 10.9 29.9 Balance at end of period $ 220.9 $ 138.3 $ 121.1 |
Reconciliation of Net Income Attributable to Noncontrolling Interests | The following table reconciles the net income attributable to nonredeemable Noncontrolling interests , as recorded in the shareholders’ equity section of the consolidated balance sheets, and the net income attributable to Redeemable noncontrolling interests , as recorded in the mezzanine section of the consolidated balance sheets, to the Net income attributable to noncontrolling interests presented on the consolidated statements of operations (in millions): For the Year Ended December 31, 2017 2016 2015 Net income attributable to nonredeemable noncontrolling interests $ 61.2 $ 56.4 $ 55.9 Net income attributable to redeemable noncontrolling interests 17.9 14.1 13.8 Net income attributable to noncontrolling interests $ 79.1 $ 70.5 $ 69.7 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Our financial assets and liabilities that are measured at fair value on a recurring basis are as follows (in millions): Fair Value Measurements at Reporting Date Using As of December 31, 2017 Fair Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Valuation Technique (1) Prepaid expenses and other current assets: Current portion of restricted marketable securities $ 17.8 $ — $ 17.8 $ — M Other long-term assets: Restricted marketable securities 44.2 — 44.2 — M Redeemable noncontrolling interests 220.9 — — 220.9 I As of December 31, 2016 Prepaid expenses and other current assets: Current portion of restricted marketable securities $ 24.2 $ — $ 24.2 $ — M Other long-term assets: Restricted marketable securities 33.5 — 33.5 — M Redeemable noncontrolling interests 138.3 — — 138.3 I (1) The three valuation techniques are: market approach (M), cost approach (C), and income approach (I). |
Schedule of Carrying Amounts and Estimated Fair Values, Financial Instruments | The carrying amounts and estimated fair values for our other financial instruments are presented in the following table (in millions): As of December 31, 2017 As of December 31, 2016 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Long-term debt: Advances under revolving credit facility $ 95.0 $ 95.0 $ 152.0 $ 152.0 Term loan facilities 294.7 296.3 421.2 422.5 5.125% Senior Notes due 2023 295.9 306.8 295.3 297.8 5.75% Senior Notes due 2024 1,193.9 1,228.5 1,193.2 1,216.6 5.75% Senior Notes due 2025 344.4 364.9 343.9 349.6 2.00% Convertible Senior Subordinated Notes due 2043 — — 275.7 382.6 Other notes payable 82.3 82.3 55.8 55.8 Financial commitments: Letters of credit — 35.4 — 33.3 |
Share-Based Payments (Tables)
Share-Based Payments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Weighted-Average Assumptions Used to Determine Fair Value of Stock Options | The fair value of the SARs granted in conjunction with the EHHI acquisition has been estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions: For the Year Ended December 31, 2017 2016 Expected volatility 28.7 % 25.9 % Risk-free interest rate 1.9 % 1.9 % Expected life (years) 2.1 5.3 Dividend yield — % — % The fair values of the options granted during the years ended December 31, 2017 , 2016 , and 2015 have been estimated at the grant date using the Black-Scholes option-pricing model with the following weighted-average assumptions: For the Year Ended December 31, 2017 2016 2015 Expected volatility 30.5 % 37.2 % 39.5 % Risk-free interest rate 2.1 % 1.6 % 1.9 % Expected life (years) 7.7 7.5 7.7 Dividend yield 2.2 % 2.1 % 2.1 % |
Schedule of Stock Option Activity | A summary of our stock option activity and related information is as follows: Shares (In Thousands) Weighted- Average Exercise Price per Share Weighted- Average Remaining Life (Years) Aggregate Intrinsic Value (In Millions) Outstanding, December 31, 2016 1,575 $ 21.45 Granted 95 42.22 Exercised (1,107 ) 18.58 Forfeitures (3 ) 43.14 Expirations (3 ) 23.19 Outstanding, December 31, 2017 557 30.53 6.0 $ 10.5 Exercisable, December 31, 2017 377 25.81 4.6 8.9 |
Schedule of Restricted Stock Activity | A summary of our issued restricted stock awards is as follows (share information in thousands): Shares Weighted-Average Grant Date Fair Value Nonvested shares at December 31, 2016 618 $ 35.06 Granted 504 42.85 Vested (427 ) 34.83 Forfeited (22 ) 39.22 Nonvested shares at December 31, 2017 673 40.90 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The significant components of the Provision for income tax expense related to continuing operations are as follows (in millions): For the Year Ended December 31, 2017 2016 2015 Current: Federal $ 72.2 $ 16.1 $ 2.6 State and other 12.8 14.9 12.2 Total current expense 85.0 31.0 14.8 Deferred: Federal 74.2 130.5 113.9 State and other 1.4 2.4 13.2 Total deferred expense 75.6 132.9 127.1 Total income tax expense related to continuing operations $ 160.6 $ 163.9 $ 141.9 |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of differences between the federal income tax at statutory rates and our actual income tax expense on our income from continuing operations, which include federal, state, and other income taxes, is presented below: For the Year Ended December 31, 2017 2016 2015 Tax expense at statutory rate 35.0 % 35.0 % 35.0 % Increase (decrease) in tax rate resulting from: State and other income taxes, net of federal tax benefit 3.5 % 3.8 % 3.6 % Increase in valuation allowance 0.4 % 0.1 % 1.2 % Noncontrolling interests (4.6 )% (4.4 )% (5.3 )% Share-based windfall tax benefits (1.8 )% — % — % Other, net (0.1 )% (0.5 )% 1.4 % Income tax expense 32.4 % 34.0 % 35.9 % |
Schedule of Components of Deferred Tax Assets and Liabilities | The significant components of our deferred tax assets and liabilities are presented in the following table (in millions): As of December 31, 2017 2016 Deferred income tax assets: Net operating loss $ 77.3 $ 64.8 Property, net 36.3 52.1 Insurance reserve 19.9 32.0 Stock-based compensation 19.5 23.7 Allowance for doubtful accounts 14.0 19.3 Alternative minimum tax — 7.5 Carrying value of partnerships — 12.9 Other accruals 20.4 26.1 Tax credits 2.8 2.6 Noncontrolling interest 26.3 14.8 Other 0.5 0.8 Total deferred income tax assets 217.0 256.6 Less: Valuation allowance (35.8 ) (27.9 ) Net deferred income tax assets 181.2 228.7 Deferred income tax liabilities: Deferred revenue (28.9 ) — Intangibles (80.0 ) (113.2 ) Convertible debt interest — (38.1 ) Carrying value of partnerships (6.2 ) — Other (2.5 ) (1.6 ) Total deferred income tax liabilities (117.6 ) (152.9 ) Net deferred income tax assets $ 63.6 $ 75.8 |
Schedule of Unrecognized Tax Benefits Rollforward | A reconciliation of the beginning and ending liability for unrecognized tax benefits is as follows (in millions): Gross Unrecognized Income Tax Benefits Accrued Interest and Penalties January 1, 2015 $ 0.9 $ — Gross amount of increases in unrecognized tax benefits related to prior periods 1.7 — Gross amount of increases in unrecognized tax benefits related to current period 0.3 — December 31, 2015 2.9 — Gross amount of increases in unrecognized tax benefits related to prior periods 0.3 — Gross amount of decreases in unrecognized tax benefits related to prior periods (0.4 ) — Gross amount of increases in unrecognized tax benefits related to current period 0.1 — Gross amount of decreases in unrecognized tax benefits related to current period (0.1 ) — December 31, 2016 2.8 — Gross amount of decreases in unrecognized tax benefits related to prior periods (0.4 ) — Decreases in unrecognized tax benefits relating to settlements with taxing authorities (2.1 ) — December 31, 2017 $ 0.3 $ — |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings per Common Share | The following table sets forth the computation of basic and diluted earnings per common share (in millions, except per share amounts): For the Year Ended December 31, 2017 2016 2015 Basic: Numerator: Income from continuing operations $ 335.8 $ 318.1 $ 253.7 Less: Net income attributable to noncontrolling interests included in continuing operations (79.1 ) (70.5 ) (69.7 ) Less: Income allocated to participating securities (0.8 ) (0.8 ) (1.0 ) Less: Convertible perpetual preferred stock dividends — — (1.6 ) Income from continuing operations attributable to Encompass Health common shareholders 255.9 246.8 181.4 Loss from discontinued operations, net of tax, attributable to Encompass Health common shareholders (0.4 ) — (0.9 ) Net income attributable to Encompass Health common shareholders $ 255.5 $ 246.8 $ 180.5 Denominator: Basic weighted average common shares outstanding 93.7 89.1 89.4 Basic earnings per share attributable to Encompass Health common shareholders: Continuing operations $ 2.73 $ 2.77 $ 2.03 Discontinued operations — — (0.01 ) Net income $ 2.73 $ 2.77 $ 2.02 Diluted: Numerator: Income from continuing operations $ 335.8 $ 318.1 $ 253.7 Less: Net income attributable to noncontrolling interests included in continuing operations (79.1 ) (70.5 ) (69.7 ) Add: Interest on convertible debt, net of tax 4.6 9.7 9.4 Add: Loss on extinguishment of convertible debt, net of tax 6.2 — — Income from continuing operations attributable to Encompass Health common shareholders 267.5 257.3 193.4 Loss from discontinued operations, net of tax, attributable to Encompass Health common shareholders (0.4 ) — (0.9 ) Net income attributable to Encompass Health common shareholders $ 267.1 $ 257.3 $ 192.5 Denominator: Diluted weighted average common shares outstanding 99.3 99.5 101.0 Diluted earnings per share attributable to Encompass Health common shareholders: Continuing operations $ 2.69 $ 2.59 $ 1.92 Discontinued operations — — (0.01 ) Net income $ 2.69 $ 2.59 $ 1.91 |
Reconciliation of Weighted Average Number of Shares Outstanding | The following table sets forth the reconciliation between basic weighted average common shares outstanding and diluted weighted average common shares outstanding (in millions): For the Year Ended December 31, 2017 2016 2015 Basic weighted average common shares outstanding 93.7 89.1 89.4 Convertible perpetual preferred stock — — 1.0 Convertible senior subordinated notes 4.0 8.5 8.3 Restricted stock awards, dilutive stock options, and restricted stock units 1.6 1.9 2.3 Diluted weighted average common shares outstanding 99.3 99.5 101.0 |
Schedule of Warrants | The following table summarizes information relating to these warrants and their activity through their expiration date (number of warrants in millions): Number of Warrants Weighted Average Exercise Price Common stock warrants outstanding as of December 31, 2016 8.2 $ 41.40 Cashless exercise (6.5 ) 41.40 Cash exercise (0.6 ) 41.40 Expired (1.1 ) 41.40 Common stock warrants outstanding as of January 17, 2017 — |
Segment Reporting Segment Rep44
Segment Reporting Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Selected Financial Information of Reportable Segments | Selected financial information for our reportable segments is as follows (in millions): Inpatient Rehabilitation Home Health and Hospice For the Year Ended December 31, For the Year Ended December 31, 2017 2016 2015 2017 2016 2015 Net operating revenues $ 3,188.1 $ 3,021.1 $ 2,653.1 $ 783.3 $ 686.1 $ 509.8 Less: Provision for doubtful accounts (46.8 ) (57.0 ) (44.7 ) (5.6 ) (4.2 ) (2.5 ) Net operating revenues less provision for doubtful accounts 3,141.3 2,964.1 2,608.4 777.7 681.9 507.3 Operating expenses: Inpatient rehabilitation: Salaries and benefits 1,603.8 1,493.4 1,310.6 — — — Other operating expenses 462.5 431.5 387.7 — — — Supplies 135.7 128.8 120.9 — — — Occupancy costs 61.9 61.2 46.2 — — — Home health and hospice: Cost of services sold (excluding depreciation and amortization) — — — 368.4 336.5 244.8 Support and overhead costs — — — 277.2 237.2 172.7 2,263.9 2,114.9 1,865.4 645.6 573.7 417.5 Other income (4.1 ) (2.9 ) (2.3 ) — — — Equity in net income of nonconsolidated affiliates (7.3 ) (9.1 ) (8.6 ) (0.7 ) (0.7 ) (0.1 ) Noncontrolling interests 67.6 64.0 62.9 6.9 6.5 6.8 Segment Adjusted EBITDA $ 821.2 $ 797.2 $ 691.0 $ 125.9 $ 102.4 $ 83.1 Capital expenditures $ 238.0 $ 198.3 $ 151.7 $ 10.7 $ 8.7 $ 5.8 |
Reconciliation of Assets from Segment to Consolidated | Inpatient Rehabilitation Home Health and Hospice Encompass Health Consolidated As of December 31, 2017 Total assets $ 3,789.1 $ 1,150.5 $ 4,893.7 Investments in and advances to nonconsolidated affiliates 9.3 2.6 11.9 As of December 31, 2016 Total assets $ 3,629.6 $ 1,123.7 $ 4,681.9 Investments in and advances to nonconsolidated affiliates 10.6 2.4 13.0 As of December 31, 2017 As of December 31, 2016 Total assets for reportable segments $ 4,939.6 $ 4,753.3 Reclassification of noncurrent deferred income tax liabilities to net noncurrent deferred income tax assets (45.9 ) (71.4 ) Total consolidated assets $ 4,893.7 $ 4,681.9 |
Reconciliation of Segment Adjusted EBITDA to Income from Continuing Operations Before Income Tax Expense | Segment reconciliations (in millions): For the Year Ended December 31, 2017 2016 2015 Total segment Adjusted EBITDA $ 947.1 $ 899.6 $ 774.1 General and administrative expenses (171.7 ) (133.4 ) (133.3 ) Depreciation and amortization (183.8 ) (172.6 ) (139.7 ) Loss on disposal of assets (4.6 ) (0.7 ) (2.6 ) Government, class action, and related settlements — — (7.5 ) Professional fees — accounting, tax, and legal — (1.9 ) (3.0 ) Loss on early extinguishment of debt (10.7 ) (7.4 ) (22.4 ) Interest expense and amortization of debt discounts and fees (154.4 ) (172.1 ) (142.9 ) Net income attributable to noncontrolling interests 79.1 70.5 69.7 Tax reform impact on noncontrolling interests (4.6 ) — — Gain related to SCA equity interest — — 3.2 Income from continuing operations before income tax expense $ 496.4 $ 482.0 $ 395.6 |
Reconciliation of Revenue from Segments to Consolidated | Additional detail regarding the revenues of our operating segments by service line follows (in millions): For the Year Ended December 31, 2017 2016 2015 Inpatient rehabilitation: Inpatient $ 3,082.4 $ 2,905.5 $ 2,547.2 Outpatient and other 105.7 115.6 105.9 Total inpatient rehabilitation 3,188.1 3,021.1 2,653.1 Home health and hospice: Home health 706.7 635.2 478.1 Hospice 76.6 50.9 31.7 Total home health and hospice 783.3 686.1 509.8 Total net operating revenues $ 3,971.4 $ 3,707.2 $ 3,162.9 |
Quarterly Data (Unaudited) (Tab
Quarterly Data (Unaudited) (Tables) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | ||
Quarterly Data (Unaudited) Table | 2017 First Second Third Fourth Total (In Millions, Except Per Share Data) Net operating revenues $ 974.8 $ 981.3 $ 995.6 $ 1,019.7 $ 3,971.4 Operating earnings (a) 147.1 141.3 145.2 144.7 578.3 Provision for income tax expense 39.7 28.6 43.1 49.2 160.6 Income from continuing operations 84.7 79.2 85.2 86.7 335.8 (Loss) income from discontinued operations, net of tax (0.3 ) 0.2 (0.1 ) (0.2 ) (0.4 ) Net income 84.4 79.4 85.1 86.5 335.4 Less: Net income attributable to noncontrolling interests (17.6 ) (16.4 ) (19.2 ) (25.9 ) (79.1 ) Net income attributable to Encompass Health $ 66.8 $ 63.0 $ 65.9 $ 60.6 $ 256.3 Earnings per common share: Basic earnings per share attributable to Encompass Health common shareholders: (b) Continuing operations $ 0.75 $ 0.70 $ 0.67 $ 0.62 $ 2.73 Discontinued operations — — — — — Net income $ 0.75 $ 0.70 $ 0.67 $ 0.62 $ 2.73 Diluted earnings per share attributable to Encompass Health common shareholders: (b) (c) Continuing operations $ 0.70 $ 0.70 $ 0.67 $ 0.61 $ 2.69 Discontinued operations — — — — — Net income $ 0.70 $ 0.70 $ 0.67 $ 0.61 $ 2.69 (a) We define operating earnings as income from continuing operations attributable to Encompass Health before (1) loss on early extinguishment of debt; (2) interest expense and amortization of debt discounts and fees; (3) other income; and (4) income tax expense. (b) Per share amounts may not sum due to the weighted average common shares outstanding during each quarter compared to the weighted average common shares outstanding during the entire year. (c) For the second quarter of 2017, adding back the loss on extinguishment of convertible debt, net of tax to our Income from continuing operations attributable to Encompass Health common shareholders causes a per share increase when calculating diluted earnings per common share resulting in an antidilutive per share amount. Therefore, basic and diluted earnings per common share are the same for the three months ended June 30, 2017. | 2016 First Second Third Fourth Total (In Millions, Except Per Share Data) Net operating revenues $ 909.8 $ 920.7 $ 926.8 $ 949.9 $ 3,707.2 Operating earnings (a) 144.2 150.2 148.2 145.5 588.1 Provision for income tax expense 39.7 42.4 42.1 39.7 163.9 Income from continuing operations 76.8 81.3 78.2 81.8 318.1 (Loss) income from discontinued operations, net of tax (0.1 ) (0.1 ) (0.1 ) 0.3 — Net income 76.7 81.2 78.1 82.1 318.1 Less: Net income attributable to noncontrolling interests (18.7 ) (18.6 ) (16.4 ) (16.8 ) (70.5 ) Net income attributable to Encompass Health $ 58.0 $ 62.6 $ 61.7 $ 65.3 $ 247.6 Earnings per common share: Basic earnings per share attributable to Encompass Health common shareholders: (b) Continuing operations $ 0.65 $ 0.70 $ 0.69 $ 0.73 $ 2.77 Discontinued operations — — — — — Net income $ 0.65 $ 0.70 $ 0.69 $ 0.73 $ 2.77 Diluted earnings per share attributable to Encompass Health common shareholders: (b) Continuing operations $ 0.61 $ 0.65 $ 0.64 $ 0.68 $ 2.59 Discontinued operations — — — — — Net income $ 0.61 $ 0.65 $ 0.64 $ 0.68 $ 2.59 (a) We define operating earnings as income from continuing operations attributable to Encompass Health before (1) loss on early extinguishment of debt; (2) interest expense and amortization of debt discounts and fees; (3) other income; and (4) income tax expense. (b) Per share amounts may not sum due to the weighted average common shares outstanding during each quarter compared to the weighted average common shares outstanding during the entire year. |
Condensed Consolidating Finan46
Condensed Consolidating Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Consolidating Statement of Operations | For the Year Ended December 31, 2017 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net operating revenues $ 21.3 $ 2,258.7 $ 1,817.5 $ (126.1 ) $ 3,971.4 Less: Provision for doubtful accounts — (30.7 ) (21.7 ) — (52.4 ) Net operating revenues less provision for doubtful accounts 21.3 2,228.0 1,795.8 (126.1 ) 3,919.0 Operating expenses: Salaries and benefits 34.7 1,077.4 1,063.5 (21.0 ) 2,154.6 Other operating expenses 32.8 321.8 230.7 (48.6 ) 536.7 Occupancy costs 1.9 93.4 34.7 (56.5 ) 73.5 Supplies — 93.2 56.1 — 149.3 General and administrative expenses 143.7 — 28.0 — 171.7 Depreciation and amortization 8.8 103.4 71.6 — 183.8 Total operating expenses 221.9 1,689.2 1,484.6 (126.1 ) 3,269.6 Loss on early extinguishment of debt 10.7 — — — 10.7 Interest expense and amortization of debt discounts and fees 130.5 21.1 23.8 (21.0 ) 154.4 Other (income) loss (21.7 ) 0.2 (3.6 ) 21.0 (4.1 ) Equity in net income of nonconsolidated affiliates — (7.3 ) (0.7 ) — (8.0 ) Equity in net income of consolidated affiliates (341.6 ) (40.3 ) — 381.9 — Management fees (145.0 ) 108.3 36.7 — — Income from continuing operations before income tax (benefit) expense 166.5 456.8 255.0 (381.9 ) 496.4 Provision for income tax (benefit) expense (90.2 ) 182.3 68.5 — 160.6 Income from continuing operations 256.7 274.5 186.5 (381.9 ) 335.8 Loss from discontinued operations, net of tax (0.4 ) — — — (0.4 ) Net income 256.3 274.5 186.5 (381.9 ) 335.4 Less: Net income attributable to noncontrolling interests — — (79.1 ) — (79.1 ) Net income attributable to Encompass Health $ 256.3 $ 274.5 $ 107.4 $ (381.9 ) $ 256.3 Comprehensive income $ 256.2 $ 274.5 $ 186.5 $ (381.9 ) $ 335.3 Comprehensive income attributable to Encompass Health $ 256.2 $ 274.5 $ 107.4 $ (381.9 ) $ 256.2 For the Year Ended December 31, 2016 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net operating revenues $ 20.1 $ 2,171.7 $ 1,633.3 $ (117.9 ) $ 3,707.2 Less: Provision for doubtful accounts — (41.8 ) (19.4 ) — (61.2 ) Net operating revenues less provision for doubtful accounts 20.1 2,129.9 1,613.9 (117.9 ) 3,646.0 Operating expenses: Salaries and benefits 45.5 1,006.1 952.6 (18.3 ) 1,985.9 Other operating expenses 25.5 309.8 203.1 (46.3 ) 492.1 Occupancy costs 2.9 89.8 31.9 (53.3 ) 71.3 Supplies — 89.9 50.1 — 140.0 General and administrative expenses 126.7 — 6.7 — 133.4 Depreciation and amortization 9.4 102.8 60.4 — 172.6 Professional fees—accounting, tax, and legal 1.9 — — — 1.9 Total operating expenses 211.9 1,598.4 1,304.8 (117.9 ) 2,997.2 Loss on early extinguishment of debt 7.4 — — — 7.4 Interest expense and amortization of debt discounts and fees 147.3 21.6 23.1 (19.9 ) 172.1 Other income (19.6 ) (0.4 ) (2.8 ) 19.9 (2.9 ) Equity in net income of nonconsolidated affiliates — (9.0 ) (0.8 ) — (9.8 ) Equity in net income of consolidated affiliates (347.2 ) (41.2 ) — 388.4 — Management fees (136.2 ) 103.1 33.1 — — Income from continuing operations before income tax (benefit) expense 156.5 457.4 256.5 (388.4 ) 482.0 Provision for income tax (benefit) expense (91.1 ) 182.6 72.4 — 163.9 Income from continuing operations 247.6 274.8 184.1 (388.4 ) 318.1 Income from discontinued operations, net of tax — — — — — Net income 247.6 274.8 184.1 (388.4 ) 318.1 Less: Net income attributable to noncontrolling interests — — (70.5 ) — (70.5 ) Net income attributable to Encompass Health $ 247.6 $ 274.8 $ 113.6 $ (388.4 ) $ 247.6 Comprehensive income $ 247.6 $ 274.8 $ 184.1 $ (388.4 ) $ 318.1 Comprehensive income attributable to Encompass Health $ 247.6 $ 274.8 $ 113.6 $ (388.4 ) $ 247.6 For the Year Ended December 31, 2015 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net operating revenues $ 19.4 $ 1,871.6 $ 1,375.4 $ (103.5 ) $ 3,162.9 Less: Provision for doubtful accounts — (33.7 ) (13.5 ) — (47.2 ) Net operating revenues less provision for doubtful accounts 19.4 1,837.9 1,361.9 (103.5 ) 3,115.7 Operating expenses: Salaries and benefits 49.4 866.7 771.8 (17.1 ) 1,670.8 Other operating expenses 31.3 266.2 175.9 (41.3 ) 432.1 Occupancy costs 4.0 66.9 28.1 (45.1 ) 53.9 Supplies — 82.8 45.9 — 128.7 General and administrative expenses 128.3 — 5.0 — 133.3 Depreciation and amortization 9.9 82.8 47.0 — 139.7 Government, class action, and related settlements 7.5 — — — 7.5 Professional fees—accounting, tax, and legal 3.0 — — — 3.0 Total operating expenses 233.4 1,365.4 1,073.7 (103.5 ) 2,569.0 Loss on early extinguishment of debt 22.4 — — — 22.4 Interest expense and amortization of debt discounts and fees 130.0 11.2 13.1 (11.4 ) 142.9 Other income (13.6 ) (0.2 ) (3.1 ) 11.4 (5.5 ) Equity in net income of nonconsolidated affiliates — (8.5 ) (0.2 ) — (8.7 ) Equity in net income of consolidated affiliates (320.4 ) (40.3 ) — 360.7 — Management fees (119.7 ) 88.8 30.9 — — Income from continuing operations before income tax (benefit) expense 87.3 421.5 247.5 (360.7 ) 395.6 Provision for income tax (benefit) expense (96.9 ) 168.2 70.6 — 141.9 Income from continuing operations 184.2 253.3 176.9 (360.7 ) 253.7 (Loss) income from discontinued operations, net of tax (1.1 ) — 0.2 — (0.9 ) Net income 183.1 253.3 177.1 (360.7 ) 252.8 Less: Net income attributable to noncontrolling interests — — (69.7 ) — (69.7 ) Net income attributable to Encompass Health $ 183.1 $ 253.3 $ 107.4 $ (360.7 ) $ 183.1 Comprehensive income $ 182.4 $ 253.3 $ 177.1 $ (360.7 ) $ 252.1 Comprehensive income attributable to Encompass Health $ 182.4 $ 253.3 $ 107.4 $ (360.7 ) $ 182.4 |
Condensed Consolidating Balance Sheet | As of December 31, 2017 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Assets Current assets: Cash and cash equivalents $ 34.3 $ 2.9 $ 17.2 $ — $ 54.4 Restricted cash — — 62.4 — 62.4 Accounts receivable, net — 285.2 186.9 — 472.1 Prepaid expenses and other current assets 61.4 21.7 48.7 (18.5 ) 113.3 Total current assets 95.7 309.8 315.2 (18.5 ) 702.2 Property and equipment, net 101.8 991.5 423.8 — 1,517.1 Goodwill — 854.6 1,118.0 — 1,972.6 Intangible assets, net 11.8 105.1 286.2 — 403.1 Deferred income tax assets 97.4 8.4 — (42.2 ) 63.6 Other long-term assets 49.2 100.5 85.4 — 235.1 Intercompany notes receivable 486.2 — — (486.2 ) — Intercompany receivable and investments in consolidated affiliates 2,839.1 311.3 — (3,150.4 ) — Total assets $ 3,681.2 $ 2,681.2 $ 2,228.6 $ (3,697.3 ) $ 4,893.7 Liabilities and Shareholders’ Equity Current liabilities: Current portion of long-term debt $ 32.8 $ 7.4 $ 9.6 $ (17.5 ) $ 32.3 Accounts payable 10.4 43.5 24.5 — 78.4 Accrued payroll 36.1 63.8 72.2 — 172.1 Accrued interest payable 21.9 2.6 0.2 — 24.7 Other current liabilities 108.8 15.6 86.6 (1.0 ) 210.0 Total current liabilities 210.0 132.9 193.1 (18.5 ) 517.5 Long-term debt, net of current portion 2,258.5 242.2 44.7 — 2,545.4 Intercompany notes payable — — 486.2 (486.2 ) — Self-insured risks 9.6 — 100.5 — 110.1 Other long-term liabilities 21.4 17.8 78.1 (42.1 ) 75.2 Intercompany payable — — 144.8 (144.8 ) — 2,499.5 392.9 1,047.4 (691.6 ) 3,248.2 Commitments and contingencies Redeemable noncontrolling interests — — 220.9 — 220.9 Shareholders’ equity: Encompass Health shareholders’ equity 1,181.7 2,288.3 717.4 (3,005.7 ) 1,181.7 Noncontrolling interests — — 242.9 — 242.9 Total shareholders’ equity 1,181.7 2,288.3 960.3 (3,005.7 ) 1,424.6 Total liabilities and shareholders’ equity $ 3,681.2 $ 2,681.2 $ 2,228.6 $ (3,697.3 ) $ 4,893.7 As of December 31, 2016 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Assets Current assets: Cash and cash equivalents $ 20.6 $ 1.6 $ 18.3 $ — $ 40.5 Restricted cash — — 60.9 — 60.9 Accounts receivable, net — 273.3 170.5 — 443.8 Prepaid expenses and other current assets 49.9 24.0 54.0 (18.6 ) 109.3 Total current assets 70.5 298.9 303.7 (18.6 ) 654.5 Property and equipment, net 41.6 979.7 370.5 — 1,391.8 Goodwill — 858.4 1,068.8 — 1,927.2 Intangible assets, net 12.0 115.5 283.8 — 411.3 Deferred income tax assets 90.9 57.6 — (72.7 ) 75.8 Other long-term assets 49.0 95.1 77.2 — 221.3 Intercompany notes receivable 528.8 — — (528.8 ) — Intercompany receivable and investments in consolidated affiliates 2,855.5 107.7 — (2,963.2 ) — Total assets $ 3,648.3 $ 2,512.9 $ 2,104.0 $ (3,583.3 ) $ 4,681.9 Liabilities and Shareholders’ Equity Current liabilities: Current portion of long-term debt $ 40.0 $ 6.4 $ 8.2 $ (17.5 ) $ 37.1 Accounts payable 7.0 37.2 24.1 — 68.3 Accrued payroll 31.6 57.3 58.4 — 147.3 Accrued interest payable 22.8 2.8 0.2 — 25.8 Other current liabilities 96.3 21.6 80.3 (1.1 ) 197.1 Total current liabilities 197.7 125.3 171.2 (18.6 ) 475.6 Long-term debt, net of current portion 2,679.2 248.9 51.2 — 2,979.3 Intercompany notes payable — — 528.8 (528.8 ) — Self-insured risks 14.1 — 96.3 — 110.4 Other long-term liabilities 21.4 15.2 85.3 (72.3 ) 49.6 Intercompany payable — — 167.6 (167.6 ) — 2,912.4 389.4 1,100.4 (787.3 ) 3,614.9 Commitments and contingencies Redeemable noncontrolling interests — — 138.3 — 138.3 Shareholders’ equity: Encompass Health shareholders’ equity 735.9 2,123.5 672.5 (2,796.0 ) 735.9 Noncontrolling interests — — 192.8 — 192.8 Total shareholders’ equity 735.9 2,123.5 865.3 (2,796.0 ) 928.7 Total liabilities and shareholders’ equity $ 3,648.3 $ 2,512.9 $ 2,104.0 $ (3,583.3 ) $ 4,681.9 |
Condensed Consolidating Statement of Cash Flows | For the Year Ended December 31, 2017 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net cash provided by operating activities $ 27.6 $ 381.3 $ 248.3 $ — $ 657.2 Cash flows from investing activities: Acquisition of businesses, net of cash acquired (10.9 ) — (27.9 ) — (38.8 ) Purchases of property and equipment (39.4 ) (106.1 ) (80.3 ) — (225.8 ) Additions to capitalized software costs (16.3 ) (0.2 ) (2.7 ) — (19.2 ) Proceeds from disposal of assets — 11.7 0.6 — 12.3 Purchases of restricted investments — — (8.5 ) — (8.5 ) Net change in restricted cash — — (1.5 ) — (1.5 ) Proceeds from repayment of intercompany note receivable 51.0 — — (51.0 ) — Other (3.7 ) — 0.7 — (3.0 ) Net cash used in investing activities (19.3 ) (94.6 ) (119.6 ) (51.0 ) (284.5 ) Cash flows from financing activities: Principal payments on debt, including pre-payments (126.9 ) — (3.0 ) — (129.9 ) Principal payments on intercompany note payable — — (51.0 ) 51.0 — Borrowings on revolving credit facility 273.3 — — — 273.3 Payments on revolving credit facility (330.3 ) — — — (330.3 ) Principal payments under capital lease obligations — (6.8 ) (8.5 ) — (15.3 ) Debt amendment and issuance costs (3.1 ) — — — (3.1 ) Repurchases of common stock, including fees and expenses (38.1 ) — — — (38.1 ) Dividends paid on common stock (91.5 ) — — — (91.5 ) Proceeds from exercising stock warrants 26.6 — — — 26.6 Distributions paid to noncontrolling interests of consolidated affiliates — — (51.9 ) — (51.9 ) Taxes paid on behalf of employees for shares withheld (19.5 ) — (0.3 ) — (19.8 ) Contributions from consolidated affiliates — — 20.8 — 20.8 Other 1.1 — (0.7 ) — 0.4 Change in intercompany advances 313.8 (278.6 ) (35.2 ) — — Net cash provided by (used in) financing activities 5.4 (285.4 ) (129.8 ) 51.0 (358.8 ) Increase (decrease) in cash and cash equivalents 13.7 1.3 (1.1 ) — 13.9 Cash and cash equivalents at beginning of year 20.6 1.6 18.3 — 40.5 Cash and cash equivalents at end of year $ 34.3 $ 2.9 $ 17.2 $ — $ 54.4 Supplemental schedule of noncash financing activity: Conversion of convertible debt $ 319.4 $ — $ — $ — $ 319.4 For the Year Ended December 31, 2016 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net cash provided by operating activities $ 65.8 $ 327.4 $ 241.2 $ — $ 634.4 Cash flows from investing activities: Acquisition of businesses, net of cash acquired — — (48.1 ) — (48.1 ) Purchases of property and equipment (21.8 ) (77.4 ) (78.5 ) — (177.7 ) Additions to capitalized software costs (22.8 ) (0.2 ) (2.2 ) — (25.2 ) Proceeds from disposal of assets — 0.7 23.2 — 23.9 Purchases of restricted investments — — (1.3 ) — (1.3 ) Net change in restricted cash — — (15.1 ) — (15.1 ) Funding of intercompany note receivable (22.5 ) — — 22.5 — Proceeds from repayment of intercompany note receivable 52.0 — — (52.0 ) — Other (3.7 ) (0.2 ) 2.3 — (1.6 ) Net cash provided by investing activities of discontinued operations 0.1 — — — 0.1 Net cash used in investing activities (18.7 ) (77.1 ) (119.7 ) (29.5 ) (245.0 ) Cash flows from financing activities: Principal payments on debt, including pre-payments (198.5 ) (1.3 ) (2.3 ) — (202.1 ) Principal borrowings on intercompany notes payable — — 22.5 (22.5 ) — Principal payments on intercompany notes payable — — (52.0 ) 52.0 — Borrowings on revolving credit facility 335.0 — — — 335.0 Payments on revolving credit facility (313.0 ) — — — (313.0 ) Principal payments under capital lease obligations (0.1 ) (5.9 ) (7.3 ) — (13.3 ) Repurchases of common stock, including fees and expenses (65.6 ) — — — (65.6 ) Dividends paid on common stock (83.8 ) — — — (83.8 ) Distributions paid to noncontrolling interests of consolidated affiliates — — (64.9 ) — (64.9 ) Taxes paid on behalf of employees for shares withheld (11.6 ) — — — (11.6 ) Contributions from consolidated affiliates — — 3.5 — 3.5 Other 6.9 — (1.6 ) — 5.3 Change in intercompany advances 263.0 (242.7 ) (20.3 ) — — Net cash used in financing activities (67.7 ) (249.9 ) (122.4 ) 29.5 (410.5 ) (Decrease) increase in cash and cash equivalents (20.6 ) 0.4 (0.9 ) — (21.1 ) Cash and cash equivalents at beginning of year 41.2 1.2 19.2 — 61.6 Cash and cash equivalents at end of year $ 20.6 $ 1.6 $ 18.3 $ — $ 40.5 For the Year Ended December 31, 2015 Encompass Health Corporation Guarantor Subsidiaries Nonguarantor Subsidiaries Eliminating Entries Encompass Health Consolidated (In Millions) Net cash provided by operating activities $ 59.7 $ 214.6 $ 227.7 $ — $ 502.0 Cash flows from investing activities: Acquisition of businesses, net of cash acquired (954.6 ) — (30.5 ) — (985.1 ) Purchases of property and equipment (15.9 ) (62.0 ) (50.5 ) — (128.4 ) Additions to capitalized software costs (24.5 ) (0.4 ) (3.2 ) — (28.1 ) Proceeds from disposal of assets — 3.5 0.5 — 4.0 Proceeds from sale of nonrestricted marketable securities 12.8 — — — 12.8 Purchases of restricted investments — — (7.1 ) — (7.1 ) Net change in restricted cash — — 2.7 — 2.7 Funding of intercompany note receivable (2.0 ) — — 2.0 — Proceeds from repayment of intercompany note receivable 24.0 — — (24.0 ) — Other (0.5 ) (1.9 ) 1.3 — (1.1 ) Net cash provided by investing activities of discontinued operations 0.5 — — — 0.5 Net cash used in investing activities (960.2 ) (60.8 ) (86.8 ) (22.0 ) (1,129.8 ) Cash flows from financing activities: Principal borrowings on term loan facilities 250.0 — — — 250.0 Proceeds from bond issuance 1,400.0 — — — 1,400.0 Principal payments on debt, including pre-payments (595.0 ) (1.6 ) (0.8 ) — (597.4 ) Principal borrowings on intercompany notes payable — — 2.0 (2.0 ) — Principal payments on intercompany notes payable — — (24.0 ) 24.0 — Borrowings on revolving credit facility 540.0 — — — 540.0 Payments on revolving credit facility (735.0 ) — — — (735.0 ) Principal payments under capital lease obligations (0.3 ) (4.5 ) (6.2 ) — (11.0 ) Debt amendment and issuance costs (31.9 ) — — — (31.9 ) Repurchases of common stock, including fees and expenses (45.3 ) — — — (45.3 ) Dividends paid on common stock (77.2 ) — — — (77.2 ) Distributions paid to noncontrolling interests of consolidated affiliates — — (54.4 ) — (54.4 ) Taxes paid on behalf of employees for shares withheld (17.2 ) — — — (17.2 ) Contributions from consolidated affiliates — — 3.0 — 3.0 Other (0.9 ) 1.5 (1.5 ) — (0.9 ) Change in intercompany advances 212.6 (149.4 ) (63.2 ) — — Net cash provided by (used in) financing activities 899.8 (154.0 ) (145.1 ) 22.0 622.7 Decrease in cash and cash equivalents (0.7 ) (0.2 ) (4.2 ) — (5.1 ) Cash and cash equivalents at beginning of year 41.9 1.4 23.4 — 66.7 Cash and cash equivalents at end of year $ 41.2 $ 1.2 $ 19.2 $ — $ 61.6 Supplemental schedule of noncash financing activities: Conversion of preferred stock to common stock $ 93.2 $ — $ — $ — $ 93.2 Intercompany note activity $ (183.5 ) $ — $ 183.5 $ — $ — |
Summary of Significant Accoun47
Summary of Significant Accounting Policies - Net Operating Revenues & Accounts Receivable (Details) - Payor Source [Member] | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accounts Receivable [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 100.00% | 100.00% | |
Accounts Receivable [Member] | Medicare [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 75.10% | 73.00% | |
Accounts Receivable [Member] | Managed Care and Other Discount Plans, including Medicare Advantage [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 17.40% | 18.50% | |
Accounts Receivable [Member] | Medicaid [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 2.40% | 2.70% | |
Accounts Receivable [Member] | Other Third-party Payors [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 2.90% | 3.30% | |
Accounts Receivable [Member] | Workers' Compensation [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 1.30% | 1.60% | |
Accounts Receivable [Member] | Patients [Member] | Self-Pay [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 0.90% | 0.90% | |
Sales Revenue, Net [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 100.00% | 100.00% | 100.00% |
Sales Revenue, Net [Member] | Inpatient Rehabilitation Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 100.00% | 100.00% | 100.00% |
Sales Revenue, Net [Member] | Home Health and Hospice Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 100.00% | 100.00% | 100.00% |
Sales Revenue, Net [Member] | Medicare [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 75.50% | 75.20% | 74.90% |
Sales Revenue, Net [Member] | Medicare [Member] | Third-Party Payor [Member] | Inpatient Rehabilitation Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 73.20% | 73.30% | 73.20% |
Sales Revenue, Net [Member] | Medicare [Member] | Third-Party Payor [Member] | Home Health and Hospice Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 85.10% | 82.90% | 83.70% |
Sales Revenue, Net [Member] | Medicare Advantage [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 8.70% | 7.90% | 7.90% |
Sales Revenue, Net [Member] | Medicare Advantage [Member] | Third-Party Payor [Member] | Inpatient Rehabilitation Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 8.40% | 7.70% | 7.90% |
Sales Revenue, Net [Member] | Medicare Advantage [Member] | Third-Party Payor [Member] | Home Health and Hospice Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 9.70% | 8.70% | 7.70% |
Sales Revenue, Net [Member] | Managed Care [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 9.50% | 9.80% | 9.80% |
Sales Revenue, Net [Member] | Managed Care [Member] | Third-Party Payor [Member] | Inpatient Rehabilitation Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 10.90% | 11.20% | 11.10% |
Sales Revenue, Net [Member] | Managed Care [Member] | Third-Party Payor [Member] | Home Health and Hospice Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 3.80% | 3.90% | 3.00% |
Sales Revenue, Net [Member] | Medicaid [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 2.70% | 3.20% | 3.00% |
Sales Revenue, Net [Member] | Medicaid [Member] | Third-Party Payor [Member] | Inpatient Rehabilitation Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 3.10% | 3.00% | 2.50% |
Sales Revenue, Net [Member] | Medicaid [Member] | Third-Party Payor [Member] | Home Health and Hospice Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 1.20% | 4.30% | 5.50% |
Sales Revenue, Net [Member] | Other Third-party Payors [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 1.30% | 1.40% | 1.70% |
Sales Revenue, Net [Member] | Other Third-party Payors [Member] | Third-Party Payor [Member] | Inpatient Rehabilitation Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 1.60% | 1.80% | 2.00% |
Sales Revenue, Net [Member] | Other Third-party Payors [Member] | Third-Party Payor [Member] | Home Health and Hospice Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 0.00% | 0.00% | 0.00% |
Sales Revenue, Net [Member] | Workers' Compensation [Member] | Third-Party Payor [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 0.70% | 0.80% | 0.90% |
Sales Revenue, Net [Member] | Workers' Compensation [Member] | Third-Party Payor [Member] | Inpatient Rehabilitation Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 0.90% | 1.00% | 1.10% |
Sales Revenue, Net [Member] | Workers' Compensation [Member] | Third-Party Payor [Member] | Home Health and Hospice Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 0.00% | 0.00% | 0.00% |
Sales Revenue, Net [Member] | Patients [Member] | Self-Pay [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 0.50% | 0.50% | 0.60% |
Sales Revenue, Net [Member] | Patients [Member] | Self-Pay [Member] | Inpatient Rehabilitation Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 0.60% | 0.60% | 0.70% |
Sales Revenue, Net [Member] | Patients [Member] | Self-Pay [Member] | Home Health and Hospice Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 0.10% | 0.10% | 0.10% |
Sales Revenue, Net [Member] | Other Income Source [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 1.10% | 1.20% | 1.20% |
Sales Revenue, Net [Member] | Other Income Source [Member] | Inpatient Rehabilitation Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 1.30% | 1.40% | 1.50% |
Sales Revenue, Net [Member] | Other Income Source [Member] | Home Health and Hospice Segment [Member] | |||
Concentration Risk [Line Items] | |||
Net operating revenues by payor source (percent) | 0.10% | 0.10% | 0.00% |
Summary of Significant Accoun48
Summary of Significant Accounting Policies - PP&E Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Buildings [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 30 years |
Buildings [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 10 years |
Leasehold improvements [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 15 years |
Leasehold improvements [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 2 years |
Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 10 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Real Estate [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 25 years |
Real Estate [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 15 years |
Vehicles [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Summary of Significant Accoun49
Summary of Significant Accounting Policies - Intangible Asset Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Certificates of need [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 30 years |
Certificates of need [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 10 years |
Licenses [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 20 years |
Licenses [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 10 years |
Noncompete agreements [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 18 years |
Noncompete agreements [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 1 year |
Trade names [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 20 years |
Trade names [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 1 year |
Internal-use software [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 7 years |
Internal-use software [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 3 years |
Market access assets [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset useful life | 20 years |
Summary of Significant Accoun50
Summary of Significant Accounting Policies Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Net operating revenues | $ 1,019.7 | $ 995.6 | $ 981.3 | $ 974.8 | $ 949.9 | $ 926.8 | $ 920.7 | $ 909.8 | $ 3,971.4 | $ 3,707.2 | $ 3,162.9 |
Less: Provision for doubtful accounts | (52.4) | (61.2) | (47.2) | ||||||||
Net income attributable to Encompass Health | $ 60.6 | $ 65.9 | $ 63 | $ 66.8 | $ 65.3 | $ 61.7 | $ 62.6 | $ 58 | 256.3 | 247.6 | $ 183.1 |
Adjustments for New Accounting Pronouncement [Member] | |||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Net operating revenues | 3,919 | 3,646 | |||||||||
Less: Provision for doubtful accounts | 0 | 0 | |||||||||
Net income attributable to Encompass Health | 256.3 | 247.6 | |||||||||
Adjustments for ASC 606 [Member] | |||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Net operating revenues | (52.4) | (61.2) | |||||||||
Less: Provision for doubtful accounts | (52.4) | (61.2) | |||||||||
Net income attributable to Encompass Health | 0 | 0 | |||||||||
As Reported [Member] | |||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Net operating revenues | 3,971.4 | 3,707.2 | |||||||||
Less: Provision for doubtful accounts | 52.4 | 61.2 | |||||||||
Net income attributable to Encompass Health | $ 256.3 | $ 247.6 |
Summary of Significant Accoun51
Summary of Significant Accounting Policies - Textual (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017USD ($)state | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |||
Number of states in which Entity operates | state | 36 | ||
Collection success rate of denied payments (percent) | 70.00% | ||
Minimum accrual of loss contingency needed to accrue for related legal fees | $ 5 | ||
Advertising expense | $ 6.3 | $ 7.5 | $ 7.3 |
Payor Source [Member] | Sales Revenue, Net [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Percentage of Medicare patient discharges (percent) | 100.00% | 100.00% | 100.00% |
Payor Source [Member] | Sales Revenue, Net [Member] | Medicare [Member] | RAC Audits [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Percentage of Medicare patient discharges (percent) | 1.00% | ||
Accounting Standards Update 2016-09 [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense | $ 8.8 | ||
Excess Tax Benefit from Share-based Compensation, Operating Activities | $ 17.3 | ||
Payments Related to Tax Withholding for Share-based Compensation | $ 11.6 | $ 17.2 |
Business Combinations - Textual
Business Combinations - Textual (Details) | Sep. 01, 2017 | Apr. 30, 2015USD ($)bed | Dec. 31, 2017USD ($)statefacilities | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Oct. 01, 2017location | Aug. 01, 2017location | Jul. 01, 2017location | May 01, 2017location | Apr. 08, 2017bed | Apr. 01, 2017bed | Feb. 01, 2017location | Nov. 30, 2016location | Oct. 31, 2016location | Sep. 30, 2016location | Aug. 31, 2016bed | Jul. 31, 2016location | May 31, 2016location | Feb. 29, 2016bed | Nov. 30, 2015USD ($)facilities | Oct. 31, 2015USD ($)hospitalbedlease | May 31, 2015bed | Dec. 31, 2014USD ($) |
Business Acquisition [Line Items] | |||||||||||||||||||||||
Goodwill | $ 1,972,600,000 | $ 1,927,200,000 | $ 1,890,100,000 | $ 1,084,000,000 | |||||||||||||||||||
Increase in goodwill | $ 45,400,000 | 51,400,000 | 806,100,000 | ||||||||||||||||||||
Number of states in which acquired entity operates | state | 36 | ||||||||||||||||||||||
Redeemable noncontrolling interests | $ 220,900,000 | 138,300,000 | |||||||||||||||||||||
Inpatient Rehabilitation Segment [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Goodwill | 1,166,000,000 | 1,142,000,000 | 1,133,100,000 | 491,500,000 | |||||||||||||||||||
Increase in goodwill | $ 24,000,000 | 8,900,000 | 641,600,000 | ||||||||||||||||||||
Number of Joint Venture hospitals accounted for using equity method of accounting | facilities | 1 | ||||||||||||||||||||||
Number of states in which acquired entity operates | state | 31 | ||||||||||||||||||||||
Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Goodwill expected to be tax-deductible | $ 0 | ||||||||||||||||||||||
Increase in goodwill | 24,000,000 | ||||||||||||||||||||||
Inpatient Rehabilitation Segment [Member] | CHI St. Vincent Hot Springs [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Interest acquired in business acquisition (percent) | 50.00% | ||||||||||||||||||||||
Number of beds acquired | bed | 20 | ||||||||||||||||||||||
Inpatient Rehabilitation Segment [Member] | St. Joseph Regional Health Center (Bryan) [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Interest acquired in business acquisition (percent) | 50.00% | ||||||||||||||||||||||
Number of beds acquired | bed | 19 | ||||||||||||||||||||||
Inpatient Rehabilitation Segment [Member] | The Bernsen Rehabilitation Center at St. John (Broken Arrow) [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Interest acquired in business acquisition (percent) | 51.00% | ||||||||||||||||||||||
Number of beds acquired | bed | 24 | ||||||||||||||||||||||
Inpatient Rehabilitation Segment [Member] | Hot Springs, Bryan and Broken Arrow [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Goodwill expected to be tax-deductible | 0 | ||||||||||||||||||||||
Goodwill | 9,400,000 | ||||||||||||||||||||||
Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Interest acquired in business acquisition (percent) | 83.00% | ||||||||||||||||||||||
Number of beds acquired | bed | 50 | ||||||||||||||||||||||
Goodwill expected to be tax-deductible | $ 0 | ||||||||||||||||||||||
Total current assets | 10,100,000 | ||||||||||||||||||||||
Goodwill | $ 700,000 | ||||||||||||||||||||||
Increase in goodwill | $ 700,000 | ||||||||||||||||||||||
Inpatient Rehabilitation Segment [Member] | Reliant [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of beds acquired | bed | 902 | ||||||||||||||||||||||
Goodwill | $ 642,600,000 | ||||||||||||||||||||||
Number of leases treated as capital leases | lease | 7 | ||||||||||||||||||||||
Number of locations | hospital | 11 | ||||||||||||||||||||||
Capital lease obligation | $ 210,000,000 | ||||||||||||||||||||||
Remaining minority limited partner interest (percent) | 0.50% | ||||||||||||||||||||||
Goodwill expected to be tax-deductible (percent) | 86.00% | ||||||||||||||||||||||
Proforma tax rate (percent) | 40.00% | ||||||||||||||||||||||
Home Health and Hospice Segment [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Goodwill | 806,600,000 | 785,200,000 | $ 757,000,000 | $ 592,500,000 | |||||||||||||||||||
Increase in goodwill | $ 21,400,000 | 42,500,000 | 164,500,000 | ||||||||||||||||||||
Number of states in which acquired entity operates | state | 28 | ||||||||||||||||||||||
Home Health and Hospice Segment [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Goodwill expected to be tax-deductible | $ 21,400,000 | ||||||||||||||||||||||
Total current assets | 100,000 | ||||||||||||||||||||||
Goodwill | 21,400,000 | ||||||||||||||||||||||
Increase in goodwill | 21,400,000 | ||||||||||||||||||||||
Home Health and Hospice Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Goodwill expected to be tax-deductible | 41,400,000 | 20,300,000 | |||||||||||||||||||||
Goodwill | $ 41,400,000 | $ 41,400,000 | $ 20,300,000 | ||||||||||||||||||||
Home Health and Hospice Segment [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Goodwill | $ 143,300,000 | ||||||||||||||||||||||
Goodwill expected to be tax-deductible (percent) | 6.50% | ||||||||||||||||||||||
Noncompete agreements [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 3 years | ||||||||||||||||||||||
Noncompete agreements [Member] | Inpatient Rehabilitation Segment [Member] | Hot Springs, Bryan and Broken Arrow [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 400,000 | ||||||||||||||||||||||
Noncompete agreements [Member] | Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 100,000 | ||||||||||||||||||||||
Noncompete agreements [Member] | Inpatient Rehabilitation Segment [Member] | Reliant [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 9,700,000 | ||||||||||||||||||||||
Noncompete agreements [Member] | Home Health and Hospice Segment [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 5 years | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 800,000 | ||||||||||||||||||||||
Noncompete agreements [Member] | Home Health and Hospice Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 5 years | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 1,100,000 | $ 1,300,000 | |||||||||||||||||||||
Noncompete agreements [Member] | Home Health and Hospice Segment [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 800,000 | ||||||||||||||||||||||
Trade names [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 1 year | ||||||||||||||||||||||
Trade names [Member] | Reliant [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Trade names [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 5 years | ||||||||||||||||||||||
Trade names [Member] | Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Trade names [Member] | Inpatient Rehabilitation Segment [Member] | Hot Springs, Bryan and Broken Arrow [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 1,000,000 | ||||||||||||||||||||||
Trade names [Member] | Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 800,000 | ||||||||||||||||||||||
Trade names [Member] | Inpatient Rehabilitation Segment [Member] | Reliant [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | 8,900,000 | ||||||||||||||||||||||
Trade names [Member] | Home Health and Hospice Segment [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 1 year | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 100,000 | ||||||||||||||||||||||
Trade names [Member] | Home Health and Hospice Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 1 year | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 700,000 | $ 500,000 | |||||||||||||||||||||
Trade names [Member] | Home Health and Hospice Segment [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | 2,800,000 | ||||||||||||||||||||||
Certificates of need [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 10 years | ||||||||||||||||||||||
Certificates of need [Member] | Reliant [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Certificates of need [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 10 years | ||||||||||||||||||||||
Certificates of need [Member] | Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Certificates of need [Member] | Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 8,800,000 | ||||||||||||||||||||||
Certificates of need [Member] | Inpatient Rehabilitation Segment [Member] | Reliant [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | 36,600,000 | ||||||||||||||||||||||
Certificates of need [Member] | Home Health and Hospice Segment [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 10 years | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 1,800,000 | ||||||||||||||||||||||
Certificates of need [Member] | Home Health and Hospice Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 10 years | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 1,900,000 | $ 4,900,000 | |||||||||||||||||||||
Certificates of need [Member] | Home Health and Hospice Segment [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | 15,600,000 | ||||||||||||||||||||||
Licenses [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 10 years | ||||||||||||||||||||||
Licenses [Member] | Reliant [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Licenses [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 10 years | ||||||||||||||||||||||
Licenses [Member] | Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 200,000 | ||||||||||||||||||||||
Licenses [Member] | Inpatient Rehabilitation Segment [Member] | Reliant [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 11,400,000 | ||||||||||||||||||||||
Licenses [Member] | Home Health and Hospice Segment [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 10 years | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 4,000,000 | ||||||||||||||||||||||
Licenses [Member] | Home Health and Hospice Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 10 years | ||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 3,400,000 | $ 3,600,000 | |||||||||||||||||||||
Licenses [Member] | Home Health and Hospice Segment [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 13,000,000 | ||||||||||||||||||||||
Maximum [Member] | Noncompete agreements [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 18 years | ||||||||||||||||||||||
Maximum [Member] | Noncompete agreements [Member] | Reliant [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 2 years | ||||||||||||||||||||||
Maximum [Member] | Noncompete agreements [Member] | Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 3 years | ||||||||||||||||||||||
Maximum [Member] | Noncompete agreements [Member] | Inpatient Rehabilitation Segment [Member] | Hot Springs, Bryan and Broken Arrow [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 3 years | ||||||||||||||||||||||
Maximum [Member] | Noncompete agreements [Member] | Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 3 years | ||||||||||||||||||||||
Maximum [Member] | Noncompete agreements [Member] | Home Health and Hospice Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 2 years | ||||||||||||||||||||||
Maximum [Member] | Trade names [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Maximum [Member] | Certificates of need [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 30 years | ||||||||||||||||||||||
Maximum [Member] | Licenses [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 20 years | ||||||||||||||||||||||
Minimum [Member] | Noncompete agreements [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 1 year | ||||||||||||||||||||||
Minimum [Member] | Noncompete agreements [Member] | Reliant [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 1 year | ||||||||||||||||||||||
Minimum [Member] | Noncompete agreements [Member] | Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 2 years | ||||||||||||||||||||||
Minimum [Member] | Noncompete agreements [Member] | Inpatient Rehabilitation Segment [Member] | Hot Springs, Bryan and Broken Arrow [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 1 year | ||||||||||||||||||||||
Minimum [Member] | Noncompete agreements [Member] | Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 2 years | ||||||||||||||||||||||
Minimum [Member] | Noncompete agreements [Member] | Home Health and Hospice Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 5 years | ||||||||||||||||||||||
Minimum [Member] | Trade names [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 1 year | ||||||||||||||||||||||
Minimum [Member] | Certificates of need [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 10 years | ||||||||||||||||||||||
Minimum [Member] | Licenses [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Finite-lived intangible asset useful life | 10 years | ||||||||||||||||||||||
Inpatient [Member] | Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of beds acquired | bed | 158 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | Celtic Healthcare of Maryland, Inc. [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 2 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | Community Health Services, Inc. [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 2 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | Bio Care Home Health Services and Kinsman Enterprises [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 2 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | VNA Healthtrends - IL, IN, AZ [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 4 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | VNA Healthtrends - OH and IL [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 2 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | Ware Visiting Nurses Services, Inc. [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 1 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | Pickens County Health Care Authority [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 1 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | Home Health Agency of Georgia, LLC [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 2 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | Advantage Health Inc. [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 1 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | Summit Home Health Care, Inc. [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 2 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | LightHouse Health Care, Inc. [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 1 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | Gulf City Home Care, Inc. [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 1 | ||||||||||||||||||||||
Home health [Member] | Home Health and Hospice Segment [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | facilities | 44 | ||||||||||||||||||||||
Hospice [Member] | Home Health and Hospice Segment [Member] | Home Health Agency of Georgia, LLC [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 2 | ||||||||||||||||||||||
Hospice [Member] | Home Health and Hospice Segment [Member] | Sotto International, Inc. [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 3 | ||||||||||||||||||||||
Hospice [Member] | Home Health and Hospice Segment [Member] | Honor Hospice, LLC [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | location | 1 | ||||||||||||||||||||||
Hospice [Member] | Home Health and Hospice Segment [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of locations | facilities | 3 | ||||||||||||||||||||||
Skilled Nursing [Member] | Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of beds acquired | bed | 74 | ||||||||||||||||||||||
Corporate Joint Venture [Member] | Inpatient Rehabilitation Segment [Member] | Memorial Hospital at Gulfport [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Interest acquired in business acquisition (percent) | 80.00% | ||||||||||||||||||||||
Number of beds acquired | bed | 33 | ||||||||||||||||||||||
Corporate Joint Venture [Member] | Inpatient Rehabilitation Segment [Member] | Mount Carmel West [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Interest acquired in business acquisition (percent) | 80.00% | ||||||||||||||||||||||
Number of beds acquired | bed | 60 | ||||||||||||||||||||||
Corporate Joint Venture [Member] | Inpatient Rehabilitation Segment [Member] | Jackson-Madison County General Hospital [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Interest acquired in business acquisition (percent) | 50.00% | ||||||||||||||||||||||
Corporate Joint Venture [Member] | Inpatient Rehabilitation Segment [Member] | Heritage Valley Beaver Hospital [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Interest acquired in business acquisition (percent) | 75.00% | ||||||||||||||||||||||
Interest exchanged in business acquisition (percent) | 25.00% | ||||||||||||||||||||||
Corporate Joint Venture [Member] | Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Goodwill | $ 24,000,000 | ||||||||||||||||||||||
Corporate Joint Venture [Member] | Noncompete agreements [Member] | Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | 600,000 | ||||||||||||||||||||||
Corporate Joint Venture [Member] | Trade names [Member] | Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | 500,000 | ||||||||||||||||||||||
Corporate Joint Venture [Member] | Certificates of need [Member] | Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Identifiable intangible assets, Finite life | $ 9,800,000 | ||||||||||||||||||||||
Corporate Joint Venture [Member] | Home health [Member] | Home Health and Hospice Segment [Member] | CareSouth [Member] | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of Joint Venture hospitals accounted for using equity method of accounting | facilities | 2 |
Business Combinations - Fair Va
Business Combinations - Fair Value of Assets and Liabilities Assumed (Details) - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Nov. 30, 2015 | Oct. 31, 2015 | Dec. 31, 2014 | |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 1,972.6 | $ 1,927.2 | $ 1,890.1 | $ 1,084 | ||
Noncompete agreements [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 3 years | |||||
Trade names [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 1 year | |||||
Trade names [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 20 years | |||||
Trade names [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 5 years | |||||
Certificates of need [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 10 years | |||||
Certificates of need [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 20 years | |||||
Certificates of need [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 10 years | |||||
Licenses [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 10 years | |||||
Licenses [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 20 years | |||||
Licenses [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 10 years | |||||
Home Health and Hospice Segment [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | 806.6 | $ 785.2 | $ 757 | 592.5 | ||
Home Health and Hospice Segment [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Property and equipment | 0.1 | |||||
Goodwill | 41.4 | 41.4 | 20.3 | |||
Total assets acquired | 48.5 | 30.7 | ||||
Total liabilities assumed | (0.4) | (0.4) | (0.2) | |||
Net assets acquired | 48.1 | 30.5 | ||||
Home Health and Hospice Segment [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Total current assets | 0.1 | |||||
Goodwill | 21.4 | |||||
Total assets acquired | 28.2 | |||||
Total liabilities assumed | 0.3 | |||||
Net assets acquired | 27.9 | |||||
Home Health and Hospice Segment [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Cash and cash equivalents | $ 0.4 | |||||
Accounts receivable | 10.5 | |||||
Prepaid expenses and other current assets | 2 | |||||
Property and equipment | 0.7 | |||||
Goodwill | 143.3 | |||||
Investment in noconsolidated affiliates, acquired | 2.2 | |||||
Total assets acquired | 191.7 | |||||
Current portion of long-term debt | 0.1 | |||||
Accounts payable | 2.7 | |||||
Accrued payroll | 2.4 | |||||
Other current liabilities | 2.8 | |||||
Long-term debt | 0.2 | |||||
Deferred tax liabilities | 9.5 | |||||
Total liabilities assumed | 17.7 | |||||
Noncontrolling interests | 4.3 | |||||
Net assets acquired | 169.7 | |||||
Home Health and Hospice Segment [Member] | Software Development [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 0.4 | |||||
Home Health and Hospice Segment [Member] | Noncompete agreements [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 1.1 | 1.3 | ||||
Finite-lived intangible asset useful life | 5 years | |||||
Home Health and Hospice Segment [Member] | Noncompete agreements [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 0.8 | |||||
Finite-lived intangible asset useful life | 5 years | |||||
Home Health and Hospice Segment [Member] | Noncompete agreements [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 0.8 | |||||
Home Health and Hospice Segment [Member] | Trade names [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 0.7 | 0.5 | ||||
Finite-lived intangible asset useful life | 1 year | |||||
Home Health and Hospice Segment [Member] | Trade names [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 0.1 | |||||
Finite-lived intangible asset useful life | 1 year | |||||
Home Health and Hospice Segment [Member] | Trade names [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 2.8 | |||||
Home Health and Hospice Segment [Member] | Certificates of need [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 1.9 | 4.9 | ||||
Finite-lived intangible asset useful life | 10 years | |||||
Home Health and Hospice Segment [Member] | Certificates of need [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 1.8 | |||||
Finite-lived intangible asset useful life | 10 years | |||||
Home Health and Hospice Segment [Member] | Certificates of need [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 15.6 | |||||
Home Health and Hospice Segment [Member] | Licenses [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 3.4 | 3.6 | ||||
Finite-lived intangible asset useful life | 10 years | |||||
Home Health and Hospice Segment [Member] | Licenses [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 4 | |||||
Finite-lived intangible asset useful life | 10 years | |||||
Home Health and Hospice Segment [Member] | Licenses [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 13 | |||||
Inpatient Rehabilitation Segment [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | $ 1,166 | $ 1,142 | 1,133.1 | $ 491.5 | ||
Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Total current assets | 10.1 | |||||
Property and equipment | 42.7 | |||||
Goodwill | 0.7 | |||||
Total assets acquired | 63.4 | |||||
Total liabilities assumed | (2.7) | |||||
Noncontrolling interests | (4.2) | |||||
Net assets acquired | 60.7 | |||||
Inpatient Rehabilitation Segment [Member] | Hot Springs, Bryan and Broken Arrow [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Property and equipment | 5.3 | |||||
Goodwill | 9.4 | |||||
Total assets acquired | 16.1 | |||||
Total liabilities assumed | 16.1 | |||||
Inpatient Rehabilitation Segment [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Cash and cash equivalents | $ 42.6 | |||||
Accounts receivable | 25.7 | |||||
Prepaid expenses and other current assets | 2.8 | |||||
Property and equipment | 220.6 | |||||
Goodwill | 642.6 | |||||
Other long-term assets | 0.9 | |||||
Total assets acquired | 1,001.8 | |||||
Current portion of long-term debt | 4.1 | |||||
Accounts payable | 1.7 | |||||
Accrued payroll | 3.7 | |||||
Other current liabilities | 10.8 | |||||
Long-term debt | 205.8 | |||||
Deferred tax liabilities | 3.9 | |||||
Total liabilities assumed | 230 | |||||
Noncontrolling interests | 0.4 | |||||
Net assets acquired | 771.4 | |||||
Inpatient Rehabilitation Segment [Member] | Noncompete agreements [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 0.1 | |||||
Inpatient Rehabilitation Segment [Member] | Noncompete agreements [Member] | Hot Springs, Bryan and Broken Arrow [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 0.4 | |||||
Inpatient Rehabilitation Segment [Member] | Noncompete agreements [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 9.7 | |||||
Inpatient Rehabilitation Segment [Member] | Trade names [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 0.8 | |||||
Finite-lived intangible asset useful life | 20 years | |||||
Inpatient Rehabilitation Segment [Member] | Trade names [Member] | Hot Springs, Bryan and Broken Arrow [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 1 | |||||
Finite-lived intangible asset useful life | 20 years | |||||
Inpatient Rehabilitation Segment [Member] | Trade names [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 20 years | |||||
Inpatient Rehabilitation Segment [Member] | Trade names [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 8.9 | |||||
Inpatient Rehabilitation Segment [Member] | Certificates of need [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 8.8 | |||||
Finite-lived intangible asset useful life | 20 years | |||||
Inpatient Rehabilitation Segment [Member] | Certificates of need [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 20 years | |||||
Inpatient Rehabilitation Segment [Member] | Certificates of need [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 36.6 | |||||
Inpatient Rehabilitation Segment [Member] | Licenses [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 0.2 | |||||
Finite-lived intangible asset useful life | 20 years | |||||
Inpatient Rehabilitation Segment [Member] | Licenses [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 11.4 | |||||
Minimum [Member] | Noncompete agreements [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 1 year | |||||
Minimum [Member] | Noncompete agreements [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 1 year | |||||
Minimum [Member] | Trade names [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 1 year | |||||
Minimum [Member] | Certificates of need [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 10 years | |||||
Minimum [Member] | Licenses [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 10 years | |||||
Minimum [Member] | Home Health and Hospice Segment [Member] | Noncompete agreements [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 5 years | |||||
Minimum [Member] | Inpatient Rehabilitation Segment [Member] | Noncompete agreements [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 2 years | |||||
Minimum [Member] | Inpatient Rehabilitation Segment [Member] | Noncompete agreements [Member] | Hot Springs, Bryan and Broken Arrow [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 1 year | |||||
Minimum [Member] | Inpatient Rehabilitation Segment [Member] | Noncompete agreements [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 2 years | |||||
Maximum [Member] | Noncompete agreements [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 18 years | |||||
Maximum [Member] | Noncompete agreements [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 2 years | |||||
Maximum [Member] | Trade names [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 20 years | |||||
Maximum [Member] | Certificates of need [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 30 years | |||||
Maximum [Member] | Licenses [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 20 years | |||||
Maximum [Member] | Home Health and Hospice Segment [Member] | Noncompete agreements [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 2 years | |||||
Maximum [Member] | Inpatient Rehabilitation Segment [Member] | Noncompete agreements [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 3 years | |||||
Maximum [Member] | Inpatient Rehabilitation Segment [Member] | Noncompete agreements [Member] | Hot Springs, Bryan and Broken Arrow [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 3 years | |||||
Maximum [Member] | Inpatient Rehabilitation Segment [Member] | Noncompete agreements [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset useful life | 3 years | |||||
Corporate Joint Venture [Member] | Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Property and equipment | $ 0.1 | |||||
Goodwill | 24 | |||||
Total assets acquired | 35 | |||||
Corporate Joint Venture [Member] | Inpatient Rehabilitation Segment [Member] | Noncompete agreements [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 0.6 | |||||
Corporate Joint Venture [Member] | Inpatient Rehabilitation Segment [Member] | Trade names [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | 0.5 | |||||
Corporate Joint Venture [Member] | Inpatient Rehabilitation Segment [Member] | Certificates of need [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets, Finite life | $ 9.8 |
Business Combinations - Net Cas
Business Combinations - Net Cash Paid for Acquisition (Details) - USD ($) $ in Millions | Nov. 30, 2015 | Nov. 30, 2015 | Oct. 31, 2015 | Apr. 30, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Business Acquisition [Line Items] | ||||||||
Acquisitions | $ 45.4 | $ 51.4 | $ 806.1 | |||||
Goodwill | 1,972.6 | 1,927.2 | 1,890.1 | $ 1,084 | ||||
Net cash paid for acquisition | 38.8 | 48.1 | 985.1 | |||||
Home Health and Hospice Segment [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquisitions | 21.4 | 42.5 | 164.5 | |||||
Goodwill | 806.6 | 785.2 | 757 | 592.5 | ||||
Home Health and Hospice Segment [Member] | Celtic, Community, Bio Care, VNA, Ware, and Pickens County [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Fair Value of Assets Acquired | 6.8 | |||||||
Acquisitions | 21.4 | |||||||
Goodwill | 21.4 | |||||||
Fair value of liabilities assumed | (0.3) | |||||||
Net cash paid for acquisition | 27.9 | |||||||
Noncash or Part Noncash Acquisition, Value of Liabilities Assumed | (0.3) | |||||||
Home Health and Hospice Segment [Member] | Series of individually immaterial business acquisitions [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Fair value of assets acquired | 7.1 | 10.4 | ||||||
Goodwill | 41.4 | 41.4 | 20.3 | |||||
Fair value of liabilities assumed | 0.4 | 0.4 | 0.2 | |||||
Net cash paid for acquisition | 48.1 | 30.5 | ||||||
Home Health and Hospice Segment [Member] | CareSouth [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Fair value of assets acquired | $ 48 | $ 48 | ||||||
Goodwill | 143.3 | 143.3 | ||||||
Fair value of liabilities assumed | (17.7) | (17.7) | ||||||
Noncontrolling interests | (4.3) | (4.3) | ||||||
Net cash paid for acquisition | $ 169.3 | |||||||
Cash acquired in acquisition | $ 0.4 | |||||||
Inpatient Rehabilitation Segment [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquisitions | 24 | 8.9 | 641.6 | |||||
Goodwill | 1,166 | 1,142 | 1,133.1 | $ 491.5 | ||||
Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Fair Value of Assets Acquired | 11 | |||||||
Acquisitions | 24 | |||||||
Business Combination, Acquisition Of Less Than 100 Percent Noncontrolling Interest, Fair Value Of Equity Interest | (24.1) | |||||||
Inpatient Rehabilitation Segment [Member] | Hot Springs, Bryan and Broken Arrow [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Fair value of assets acquired | 6.7 | |||||||
Goodwill | 9.4 | |||||||
Fair value of liabilities assumed | (16.1) | |||||||
Net cash paid for acquisition | $ 0 | |||||||
Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquisitions | $ 0.7 | |||||||
Fair value of assets acquired | 62.8 | |||||||
Goodwill | 0.7 | |||||||
Fair value of liabilities assumed | 2.7 | |||||||
Noncontrolling interests | 4.2 | |||||||
Net cash paid for acquisition | $ 56.6 | |||||||
Inpatient Rehabilitation Segment [Member] | Reliant [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Fair value of assets acquired | $ 316.6 | |||||||
Goodwill | 642.6 | |||||||
Fair value of liabilities assumed | (230) | |||||||
Noncontrolling interests | (0.4) | |||||||
Net cash paid for acquisition | 728.8 | |||||||
Cash acquired in acquisition | $ 42.6 | |||||||
Corporate Joint Venture [Member] | Inpatient Rehabilitation Segment [Member] | Gulfport, Mount Carmel, Jackson and Heritage Valley [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill | 24 | |||||||
Net cash paid for acquisition | $ 10.9 |
Business Combinations - Pro For
Business Combinations - Pro Forma Results of Operation (Details) - USD ($) $ in Millions | 10 Months Ended | 11 Months Ended | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
2017 Acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | $ 32.9 | |||||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | $ (6.3) | |||||
Business Acquisition, Pro Forma Revenue | $ 3,996.1 | $ 3,771.5 | ||||
Business Acquisition, Pro Forma Net Income (Loss) | $ 260.3 | 254.8 | ||||
2016 Acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | $ 27.4 | |||||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | $ (2.2) | |||||
Business Acquisition, Pro Forma Revenue | 3,745.6 | $ 3,217.1 | ||||
Business Acquisition, Pro Forma Net Income (Loss) | $ 252.2 | 187.3 | ||||
2015 Acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Acquisition, Pro Forma Revenue | 3,479.9 | $ 2,851 | ||||
Business Acquisition, Pro Forma Net Income (Loss) | 234 | $ 276.9 | ||||
Inpatient Rehabilitation Segment [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 54.7 | |||||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | 1.7 | |||||
Inpatient Rehabilitation Segment [Member] | Reliant [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 63.7 | |||||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | 11.2 | |||||
Home Health and Hospice Segment [Member] | Series of individually immaterial business acquisitions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 17.8 | |||||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | 1.2 | |||||
Home Health and Hospice Segment [Member] | CareSouth [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 19.2 | |||||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | $ 2.5 |
Cash and Marketable Securitie56
Cash and Marketable Securities - Components of Investments (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Cash and Cash Equivalents [Line Items] | ||||
Cash & Cash Equivalents | $ 54.4 | $ 40.5 | $ 61.6 | $ 66.7 |
Total restricted cash | 62.4 | 60.9 | ||
Restricted Marketable Securities | 62 | 57.7 | ||
Total | 178.8 | 159.1 | ||
Cash [Member] | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash & Cash Equivalents | 54.4 | 40.5 | ||
Total restricted cash | 62.4 | 60.9 | ||
Restricted Marketable Securities | 0 | 0 | ||
Total | 116.8 | 101.4 | ||
Equity Securities [Member] | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash & Cash Equivalents | 0 | 0 | ||
Total restricted cash | 0 | 0 | ||
Restricted Marketable Securities | 62 | 57.7 | ||
Total | $ 62 | $ 57.7 |
Variable Interest Entities - Te
Variable Interest Entities - Textuals (Details) - Variable Interest Entity, Primary Beneficiary, Aggregated Disclosure [Member] - entity | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Variable Interest Entity [Line Items] | ||
Number of consolidated limited partnership-like entities | 10 | 10 |
Minimum [Member] | ||
Variable Interest Entity [Line Items] | ||
Ownership interest in the consolidated entities (percent) | 6.80% | |
Maximum [Member] | ||
Variable Interest Entity [Line Items] | ||
Ownership interest in the consolidated entities (percent) | 99.50% |
Cash and Marketable Securitie58
Cash and Marketable Securities - Restricted Cash (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Total restricted cash | $ 62.4 | $ 60.9 |
Affiliate cash [Member] | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Total restricted cash | 18.1 | 22.9 |
Self-insured captive funds [Member] | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Total restricted cash | $ 44.3 | $ 38 |
Variable Interest Entities - Ca
Variable Interest Entities - Carrying Amounts and Classification of Consolidated VIEs (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Variable Interest Entity [Line Items] | |||||
Cash and cash equivalents | $ 54.4 | $ 40.5 | $ 61.6 | $ 66.7 | |
Restricted cash | 62.4 | 60.9 | |||
Accounts receivable, net of allowance for doubtful accounts | 459.5 | 432 | |||
Total current assets | 702.2 | 654.5 | |||
Property and equipment, net | 1,517.1 | 1,391.8 | |||
Goodwill | 1,972.6 | 1,927.2 | $ 1,890.1 | $ 1,084 | |
Intangible assets, net | 403.1 | 411.3 | |||
Other long-term assets | 235.1 | 221.3 | |||
Total assets | [1] | 4,893.7 | 4,681.9 | ||
Current portion of long-term debt | 32.3 | 37.1 | |||
Accounts payable | 78.4 | 68.3 | |||
Accrued interest payable | 24.7 | 25.8 | |||
Other current liabilities | 210 | 197.1 | |||
Total current liabilities | 517.5 | 475.6 | |||
Long-term debt, net of current portion | 2,545.4 | 2,979.3 | |||
Total liabilities | 3,248.2 | 3,614.9 | |||
Variable Interest Entity, Primary Beneficiary, Aggregated Disclosure [Member] | |||||
Variable Interest Entity [Line Items] | |||||
Cash and cash equivalents | 1.2 | 1.6 | |||
Restricted cash | 3.5 | 3.8 | |||
Accounts receivable, net of allowance for doubtful accounts | 32.6 | 30.8 | |||
Other current assets | 2.1 | 2 | |||
Total current assets | 39.4 | 38.2 | |||
Property and equipment, net | 142.8 | 140 | |||
Goodwill | 73.5 | 73.5 | |||
Intangible assets, net | 7.7 | 9.6 | |||
Deferred income tax assets | 0.7 | 0.6 | |||
Other long-term assets | 0 | 0.4 | |||
Total assets | 264.1 | 262.3 | |||
Current portion of long-term debt | 1.8 | 1.5 | |||
Accounts payable | 6.5 | 6.8 | |||
Accrued payroll | 7.1 | 6.6 | |||
Accrued interest payable | 0.2 | 0.2 | |||
Other current liabilities | 8.6 | 5.4 | |||
Total current liabilities | 24.2 | 20.5 | |||
Long-term debt, net of current portion | 28.3 | 29.8 | |||
Total liabilities | $ 52.5 | $ 50.3 | |||
[1] | Our consolidated assets as of December 31, 2017 and December 31, 2016 include total assets of variable interest entities of $264.1 million and $262.3 million, respectively, which cannot be used by us to settle the obligations of other entities. Our consolidated liabilities as of December 31, 2017 and December 31, 2016 include total liabilities of the variable interest entities of $52.5 million and $50.3 million, respectively. See Note 3, Variable Interest Entities. |
Cash and Marketable Securitie60
Cash and Marketable Securities - Textual (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash and Cash Equivalents [Abstract] | |||
Restricted marketable securities | $ 44,200,000 | $ 33,500,000 | |
Impairment charges related to restricted marketable securities | $ 0 | $ 0 | $ 0 |
Cash and Marketable Securitie61
Cash and Marketable Securities - Restricted Marketable Securities (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Summary of Restricted Marketable Securities | ||
Restricted marketable securities, cost | $ 64 | $ 59.6 |
Restricted marketable securities, gross unrealized gains | 0.3 | 0.2 |
Restricted marketable securities, gross unrealized losses | (2.3) | (2.1) |
Restricted marketable securities, fair value | $ 62 | $ 57.7 |
Cash and Marketable Securitie62
Cash and Marketable Securities - Investing Information Related to Marketable Securities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Investment information related to restricted marketable securities | |||
Gross realized gains | $ 0 | $ 0 | $ 1.2 |
Gross realized losses | 0 | 0 | 0 |
Restricted Marketable Securities [Member] | |||
Investment information related to restricted marketable securities | |||
Proceeds from sales of available-for-sale securities | 4 | 0 | 0 |
Nonrestricted Marketable Securities [Member] | |||
Investment information related to restricted marketable securities | |||
Proceeds from sales of available-for-sale securities | $ 0 | $ 0 | $ 12.8 |
Accounts Receivable - Component
Accounts Receivable - Components of Accounts Receivable (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of Accounts Receivable, Net, Current | ||
Accounts receivable, net of allowance for doubtful accounts of $60.9 in 2017; $53.9 in 2016 | $ 459.5 | $ 432 |
Other accounts receivable | 12.6 | 11.8 |
Accounts receivable, current | 472.1 | 443.8 |
Noncurrent patient accounts receivable, net of allowance for doubtful accounts of $52.2 million in 2017; $49.5 million in 2016 | 129.1 | 125.9 |
Accounts receivable, net | 601.2 | 569.7 |
Allowance for doubtful accounts receivable, current | 60.9 | 53.9 |
Allowance for doubtful accounts receivable, noncurrent | $ 52.2 | $ 49.5 |
Property and Equipment - Compon
Property and Equipment - Components of Property and Equipment (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Components of Property and Equipment | ||
Property and Equipment, Gross | $ 2,453.6 | $ 2,279 |
Property and Equipment, net | 1,517.1 | 1,391.8 |
Land, Building, Improvements, Equipment and Furniture [Member] | ||
Components of Property and Equipment | ||
Less: Accumulated depreciation and amortization | (1,097.8) | (982.4) |
Property and Equipment, net | 1,355.8 | 1,296.6 |
Land [Member] | ||
Components of Property and Equipment | ||
Property and Equipment, Gross | 125.4 | 125.3 |
Building [Member] | ||
Components of Property and Equipment | ||
Property and Equipment, Gross | 1,712.4 | 1,601.4 |
Leasehold Improvements [Member] | ||
Components of Property and Equipment | ||
Property and Equipment, Gross | 138.1 | 115.2 |
Vehicles [Member] | ||
Components of Property and Equipment | ||
Property and Equipment, Gross | 16.2 | 11.8 |
Furniture and Fixtures [Member] | ||
Components of Property and Equipment | ||
Property and Equipment, Gross | 461.5 | 425.3 |
Construction in Progress [Member] | ||
Components of Property and Equipment | ||
Property and Equipment, net | $ 161.3 | $ 95.2 |
Accounts Receivable - Textual (
Accounts Receivable - Textual (Details) | Dec. 31, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | ||
Allowance for doubtful accounts as a percentage of total patient due accounts receivable balance (percent) | 16.10% | 15.60% |
Property and Equipment - Textua
Property and Equipment - Textual (Details) $ in Millions | 1 Months Ended | 12 Months Ended | |||
Feb. 28, 2016 | Dec. 31, 2017USD ($)transaction | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Feb. 29, 2016renewal_option | |
Property, Plant and Equipment [Line Items] | |||||
Percentage of property and equipment, net pledged to lenders under credit agreement (percent) | 72.00% | ||||
Financing obligation liability | $ 271.5 | $ 279.3 | |||
Estimate of total financing obligation liability | 884.9 | ||||
Rental income from subleases | 2.9 | 4.1 | $ 5 | ||
Total expected future minimum rentals | $ 0.8 | ||||
Number of sale/leaseback transactions | transaction | 2 | ||||
Future minimum payments under lease back transaction, due 2018 | $ 2.7 | ||||
Future minimum payments under lease back transaction, due 2019 | 2.7 | ||||
Future minimum payments under lease back transaction, due 2020 | 2.7 | ||||
Future minimum payments under lease back transaction, due 2021 | 2.5 | ||||
Future minimum payments under lease back transaction, due thereafter | $ 3.2 | ||||
Minimum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Lease term | 1 year | ||||
Maximum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Lease term | 15 years | ||||
Development / Lease Agreement [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Lease term | 15 years | ||||
Number of lease renewal options available | renewal_option | 4 | ||||
Term of lease renewal options | 5 years | ||||
Increase in Property and equipment, net | $ 49.8 | 20.3 | |||
Financing Obligation [Member] | Development / Lease Agreement [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimate of total financing obligation liability | 56 | ||||
Long-term Debt, Net of Current Portions [Member] | Development / Lease Agreement [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Financing obligation liability | 49.5 | $ 20.3 | |||
Financing obligation liability, current | $ 0.3 |
Accounts Receivable - Allowance
Accounts Receivable - Allowance for Doubtful Accounts Activity (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Activity Related to our Allowance for Doubtful Accounts | |||
Balance at Beginning of Period | $ 103.4 | $ 71.6 | $ 43 |
Additions and Charges to Expense | 52.4 | 61.2 | 47.2 |
Deductions and Accounts Written Off | (42.7) | (29.4) | (18.6) |
Balance at End of Period | $ 113.1 | $ 103.4 | $ 71.6 |
Property and Equipment - Fully
Property and Equipment - Fully Depreciated Assets and Assets Under Capital Lease (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Fully depreciated assets | $ 318.6 | $ 289.7 |
Capital Leases, Balance Sheet, Assets by Major Class, Net [Abstract] | ||
Capital Leased Assets, Gross | 342.9 | 339.9 |
Accumumlated Amortization | (104.6) | (83.5) |
Assets Under Capital Lease Obligations, Net | 238.3 | 256.4 |
Building [Member] | ||
Capital Leases, Balance Sheet, Assets by Major Class, Net [Abstract] | ||
Capital Leased Assets, Gross | 329.6 | 331 |
Vehicles [Member] | ||
Capital Leases, Balance Sheet, Assets by Major Class, Net [Abstract] | ||
Capital Leased Assets, Gross | 13 | 8.6 |
Equipment [Member] | ||
Capital Leases, Balance Sheet, Assets by Major Class, Net [Abstract] | ||
Capital Leased Assets, Gross | $ 0.3 | $ 0.3 |
Property and Equipment - Deprec
Property and Equipment - Depreciation, Amortization, Capitalized Interest and Rent Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 111.8 | $ 102.3 | $ 91 |
Amortization expense | 22.7 | 21.8 | 12.7 |
Interest capitalized | 3.7 | 2 | 1.3 |
Rent expense: | |||
Minimum rent payments | 66.5 | 62.6 | 48.8 |
Contingent and other rents | 24.1 | 29.4 | 21.6 |
Other | 8.9 | 4 | 3.8 |
Total rent expense | $ 99.5 | $ 96 | $ 74.2 |
Property and Equipment - Straig
Property and Equipment - Straight-line Rental Accrual (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Abstract] | ||
Straight-line rental accrual | $ 11.2 | $ 11.8 |
Property and Equipment - Future
Property and Equipment - Future Minimum Lease Payments (Details) $ in Millions | Dec. 31, 2017USD ($) |
Property, Plant and Equipment [Abstract] | |
Operating Leases, 2018 | $ 65 |
Operating Leases, 2019 | 59.5 |
Operating Leases, 2020 | 49.9 |
Operating Leases, 2021 | 39.7 |
Operating Leases, 2022 | 28.3 |
Operating Leases, 2023 and thereafter | 159.3 |
Operating Leases, Total | 401.7 |
Capital Lease Obligations, 2018 | 36.4 |
Capital Lease Obligations, 2019 | 33.2 |
Capital Lease Obligations, 2020 | 28.8 |
Capital Lease Obligations, 2021 | 28.4 |
Capital Lease Obligations, 2022 | 28.7 |
Capital Lease Obligations, 2023 and thereafter | 327.7 |
Capital Lease Obligations, Total | 483.2 |
Less: Interest portion | (211.7) |
Obligations under capital leases | 271.5 |
Operating & Capital Lease Obligations, 2018 | 101.4 |
Operating & Capital Lease Obligations, 2019 | 92.7 |
Operating & Capital Lease Obligations, 2020 | 78.7 |
Operating & Capital Lease Obligations, 2021 | 68.1 |
Operating & Capital Lease Obligations, 2022 | 57 |
Operating & Capital Lease Obligations, 2023 and thereafter | 487 |
Operating & Capital Lease Obligations, Total | $ 884.9 |
Goodwill and Other Intangible72
Goodwill and Other Intangible Assets - Carrying Amounts of Goodwill (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Changes in the Carrying Amount of Goodwill | |||
Goodwill, Beginning Balance | $ 1,927.2 | $ 1,890.1 | $ 1,084 |
Acquisitions | 45.4 | 51.4 | 806.1 |
Divestiture of pediatric home health services | (14.3) | ||
Goodwill, Ending Balance | 1,972.6 | 1,927.2 | 1,890.1 |
Inpatient Rehabilitation Segment [Member] | |||
Schedule of Changes in the Carrying Amount of Goodwill | |||
Goodwill, Beginning Balance | 1,142 | 1,133.1 | 491.5 |
Acquisitions | 24 | 8.9 | 641.6 |
Divestiture of pediatric home health services | 0 | ||
Goodwill, Ending Balance | 1,166 | 1,142 | 1,133.1 |
Home Health and Hospice Segment [Member] | |||
Schedule of Changes in the Carrying Amount of Goodwill | |||
Goodwill, Beginning Balance | 785.2 | 757 | 592.5 |
Acquisitions | 21.4 | 42.5 | 164.5 |
Divestiture of pediatric home health services | (14.3) | ||
Goodwill, Ending Balance | $ 806.6 | $ 785.2 | $ 757 |
Goodwill and Other Intangible73
Goodwill and Other Intangible Assets - Textuals (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill [Line Items] | |||
Proceeds from disposal of assets | $ 12,300,000 | $ 23,900,000 | $ 4,000,000 |
Goodwill impairment loss | 0 | 0 | $ 0 |
Accumulated goodwill impairment | $ 0 | ||
Pediatric Home Care Service [Member] | |||
Goodwill [Line Items] | |||
Proceeds from disposal of assets | 21,000,000 | ||
Gain recorded as part of other operating expenses | $ 3,300,000 |
Goodwill and Other Intangible74
Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of Intangible Assets by Major Class | ||
Gross Carrying Amount | $ 708.3 | $ 667.2 |
Accumulated Amortization | (305.2) | (255.9) |
Net | 403.1 | 411.3 |
Certificates of need [Member] | ||
Schedule of Intangible Assets by Major Class | ||
Gross Carrying Amount | 113.7 | 98.6 |
Accumulated Amortization | (19.5) | (12.9) |
Net | 94.2 | 85.7 |
Licenses [Member] | ||
Schedule of Intangible Assets by Major Class | ||
Gross Carrying Amount | 146 | 142 |
Accumulated Amortization | (71.6) | (62.1) |
Net | 74.4 | 79.9 |
Noncompete agreements [Member] | ||
Schedule of Intangible Assets by Major Class | ||
Gross Carrying Amount | 63.5 | 62.2 |
Accumulated Amortization | (55.4) | (47.3) |
Net | 8.1 | 14.9 |
Trade Name - Encompass [Member] | ||
Schedule of Intangible Assets by Major Class | ||
Gross Carrying Amount | 135.2 | 135.2 |
Accumulated Amortization | 0 | 0 |
Net | 135.2 | 135.2 |
Trade names [Member] | ||
Schedule of Intangible Assets by Major Class | ||
Gross Carrying Amount | 35.1 | 34.6 |
Accumulated Amortization | (16.4) | (13.9) |
Net | 18.7 | 20.7 |
Internal-use Software [Member] | ||
Schedule of Intangible Assets by Major Class | ||
Gross Carrying Amount | 201.6 | 181.4 |
Accumulated Amortization | (132.3) | (110.2) |
Net | 69.3 | 71.2 |
Market access assets [Member] | ||
Schedule of Intangible Assets by Major Class | ||
Gross Carrying Amount | 13.2 | 13.2 |
Accumulated Amortization | (10) | (9.5) |
Net | $ 3.2 | $ 3.7 |
Goodwill and Other Intangible75
Goodwill and Other Intangible Assets - Amortization Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 49.3 | $ 48.5 | $ 36 |
Goodwill and Other Intangible76
Goodwill and Other Intangible Assets - Estimated Future Amortization Expense (Details) $ in Millions | Dec. 31, 2017USD ($) |
Schedule of Future Estimated Amortization Expense, Other Intangible Assets | |
2,018 | $ 42.4 |
2,019 | 37.2 |
2,020 | 30.6 |
2,021 | 26.1 |
2,022 | $ 22.7 |
Investments in and Advances t77
Investments in and Advances to Nonconsolidated Affiliates - Textual (Details) | Dec. 31, 2017subsidiary |
Schedule of Investments [Line Items] | |
Number of Partially-Owned Subsidiaries | 6 |
Number of General or Limited Partnerships, Limited Liability Companies, or Joint Ventures | 5 |
Minimum [Member] | |
Schedule of Investments [Line Items] | |
Affiliates Ownership Percentage | 1.00% |
Maximum [Member] | |
Schedule of Investments [Line Items] | |
Affiliates Ownership Percentage | 60.00% |
Investments in and Advances t78
Investments in and Advances to Nonconsolidated Affiliates - Schedule of Other Long-term Assets (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Equity method investments: | ||
Capital contributions | $ 0.9 | $ 0.9 |
Cumulative share of income | 105.3 | 97.8 |
Cumulative share of distributions | (94.5) | (86) |
Equity Method Investments | 11.7 | 12.7 |
Cost method investments: | ||
Capital contributions, net of distributions and impairments | 0.2 | 0.3 |
Total Investments in and advances to nonconsolidated affiliates | $ 11.9 | $ 13 |
Investments in and Advances t79
Investments in and Advances to Nonconsolidated Affiliates - Combined Assets, Liabilities and Equity (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Assets- | |||
Current | $ 10.1 | $ 13.1 | |
Noncurrent | 18.3 | 19.2 | |
Total assets | 28.4 | 32.3 | |
Liabilities and equity- | |||
Current liabilities | 2.7 | 2.7 | |
Noncurrent liabilities | 0.2 | 0.2 | |
Partners' capital and shareholders' equity- | |||
Encompass Health | 11.7 | 12.7 | |
Outside partners | 13.8 | 16.7 | |
Total liabilities and equity | 28.4 | 32.3 | |
Combined Statements of Operations of Equity Method Affiliates | |||
Net operating revenues | 40.9 | 44.8 | $ 36.5 |
Operating expenses | (24.1) | (24.3) | (16.9) |
Income from continuing operations, net of tax | 17 | 20.5 | 18.9 |
Net income | $ 17 | $ 20.5 | $ 18.9 |
Long-term Debt - Long-term Debt
Long-term Debt - Long-term Debt Outstanding (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Sep. 11, 2012 |
Schedule of Outstanding Long-term Debt | ||||
Capital lease obligations | $ 271.5 | $ 279.3 | ||
Total debt and Capital lease obligations | 2,577.7 | 3,016.4 | ||
Less: Current portion | (32.3) | (37.1) | ||
Long-term debt, net of current portion | 2,545.4 | 2,979.3 | ||
Term Loan Facilities [Member] | Term Loan Facilities [Member] | ||||
Schedule of Outstanding Long-term Debt | ||||
Total debt | $ 294.7 | $ 421.2 | ||
Senior Notes [Member] | 5.125% Senior Notes Due 2023 [Member] | ||||
Schedule of Outstanding Long-term Debt | ||||
Debt instrument interest rate (percent) | 5.125% | 5.125% | 5.125% | |
Total debt | $ 295.9 | $ 295.3 | ||
Senior Notes [Member] | 5.75% Senior Notes Due 2024 [Member] | ||||
Schedule of Outstanding Long-term Debt | ||||
Debt instrument interest rate (percent) | 5.75% | 5.75% | 5.75% | |
Total debt | $ 1,193.9 | $ 1,193.2 | ||
Senior Notes [Member] | 5.75% Senior Notes Due 2025 [Member] | ||||
Schedule of Outstanding Long-term Debt | ||||
Debt instrument interest rate (percent) | 5.75% | 5.75% | 5.75% | |
Total debt | $ 344.4 | $ 343.9 | ||
Senior Subordinated Notes [Member] | 2.00% Convertible Senior Subordinated Notes due 2043 [Member] | ||||
Schedule of Outstanding Long-term Debt | ||||
Debt instrument interest rate (percent) | 2.00% | 2.00% | ||
Total debt | $ 0 | $ 275.7 | ||
Other Notes Payable [Member] | ||||
Schedule of Outstanding Long-term Debt | ||||
Total debt | 82.3 | 55.8 | ||
Revolving Credit Facility [Member] | ||||
Schedule of Outstanding Long-term Debt | ||||
Total debt | $ 95 | $ 152 |
Long-term Debt - Scheduled Prin
Long-term Debt - Scheduled Principal Payments Due on Long-term Debt (Details) $ in Millions | Dec. 31, 2017USD ($) |
Face Amount [Member] | |
Long-term Debt by Maturity | |
2,018 | $ 32.3 |
2,019 | 32.3 |
2,020 | 25.2 |
2,021 | 25.8 |
2,022 | 356.1 |
Thereafter | 2,123.4 |
Total | 2,595.1 |
Net Amount [Member] | |
Long-term Debt by Maturity | |
2,018 | 32.3 |
2,019 | 32.2 |
2,020 | 25.2 |
2,021 | 25.8 |
2,022 | 354.5 |
Thereafter | 2,107.7 |
Total | $ 2,577.7 |
Long-term Debt - Textual (Detai
Long-term Debt - Textual (Details) | Sep. 29, 2017USD ($) | May 31, 2017USD ($)shares | Sep. 30, 2016USD ($) | May 31, 2016USD ($) | Mar. 31, 2016USD ($) | Nov. 30, 2015USD ($) | Sep. 30, 2015USD ($) | Aug. 31, 2015USD ($) | Mar. 31, 2015USD ($) | Jan. 31, 2015USD ($) | Sep. 30, 2014USD ($) | Nov. 30, 2013USD ($)shares | Oct. 31, 2012USD ($) | Sep. 30, 2012USD ($) | Dec. 31, 2017USD ($) | Mar. 31, 2017shares | May 31, 2016USD ($) | Dec. 31, 2013 | Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares | Sep. 01, 2019 | Jul. 01, 2017 | May 01, 2017 | Oct. 31, 2015USD ($) | Sep. 11, 2012 |
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Loss on early extinguishment of debt | $ 10,700,000 | $ 7,400,000 | $ 22,400,000 | |||||||||||||||||||||||
Senior secured leverage ratio maximum | 2 | 2 | ||||||||||||||||||||||||
Repayments made on debt | $ 129,900,000 | 202,100,000 | 597,400,000 | |||||||||||||||||||||||
Conversion of convertible debt | $ 319,400,000 | $ 0 | $ 0 | |||||||||||||||||||||||
Incremental Common Shares Attributable to Dilutive Effect of Conversion of Debt Securities | shares | 4,000,000 | 8,500,000 | 8,300,000 | |||||||||||||||||||||||
Capital Lease Obligations [Member] | Minimum [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Effective interest rate (percent) | 2.00% | 2.00% | ||||||||||||||||||||||||
Capital Lease Obligations [Member] | Maximum [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Effective interest rate (percent) | 11.00% | 11.00% | ||||||||||||||||||||||||
Term Loan Facilities [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Maximum leverage ratio under the financial covenants | 4.50 | 4.50 | ||||||||||||||||||||||||
Senior Notes [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Redemption price, (percent) | 101.00% | |||||||||||||||||||||||||
Convertible Preferred Stock [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Shares exchanged for convertible debt (shares) | shares | 257,110 | |||||||||||||||||||||||||
Convertible debt dividend rate (percent) | 6.50% | |||||||||||||||||||||||||
Revolving Credit Facility [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Repayments made on debt | $ 195,000,000 | |||||||||||||||||||||||||
Term Loan Facilities [Member] | Term Loan Facilities [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Repayments made on debt | $ 250,000,000 | |||||||||||||||||||||||||
Repayments of Debt | $ 110,000,000 | |||||||||||||||||||||||||
The 2015 & 2016 Credit Agreement [Member] [Member] | Term Loan Facilities [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Credit facility borrowing capacity | $ 500,000,000 | |||||||||||||||||||||||||
Percentageof aggregate principal amount outstanding (percent) | 1.25% | |||||||||||||||||||||||||
Senior secured leverage ratio maximum | 1.75 | 1.75 | ||||||||||||||||||||||||
Maximum leverage ratio under the financial covenants | 4.50 | 4.25 | ||||||||||||||||||||||||
Proceeds from credit facility | $ 125,000,000 | |||||||||||||||||||||||||
Remaining capacity under credit facility | $ 125,000,000 | |||||||||||||||||||||||||
The 2015 & 2016 Credit Agreement [Member] [Member] | Letter of Credit [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Credit facility borrowing capacity | $ 260,000,000 | |||||||||||||||||||||||||
The 2015 & 2016 Credit Agreement [Member] [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Credit facility borrowing capacity | $ 600,000,000 | |||||||||||||||||||||||||
5.75% Senior Notes Due 2025 [Member] | Senior Notes [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Aggregate principal amount | 350,000,000 | |||||||||||||||||||||||||
Net proceeds for offering | $ 344,000,000 | |||||||||||||||||||||||||
Debt instrument maturity date | Sep. 15, 2025 | |||||||||||||||||||||||||
Effective interest rate (percent) | 6.00% | |||||||||||||||||||||||||
Debt instrument interest rate (percent) | 5.75% | 5.75% | 5.75% | 5.75% | ||||||||||||||||||||||
The Credit Agreement [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Amounts outstanding under letter of credit facility | $ 35,400,000 | $ 35,400,000 | $ 33,300,000 | |||||||||||||||||||||||
The Credit Agreement [Member] | Term Loan Facilities [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Credit facility borrowing capacity | $ 300,000,000 | |||||||||||||||||||||||||
Percentageof aggregate principal amount outstanding (percent) | 1.25% | 1.25% | ||||||||||||||||||||||||
Commitment fee (percent) | 0.375% | |||||||||||||||||||||||||
Senior secured leverage ratio maximum | 2 | |||||||||||||||||||||||||
Payment limit under the credit agreement's negative covenant | $ 200,000,000 | |||||||||||||||||||||||||
The Credit Agreement [Member] | Federal Funds Effective Swap Rate [Member] | Term Loan Facilities [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Spread on variable rate (percent) | 0.50% | 1.50% | ||||||||||||||||||||||||
The Credit Agreement [Member] | Scenario, Forecast [Member] | Term Loan Facilities [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Maximum leverage ratio under the financial covenants | 4.25 | |||||||||||||||||||||||||
The Credit Agreement [Member] | Letter of Credit [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Credit facility borrowing capacity | $ 260,000,000 | |||||||||||||||||||||||||
The Credit Agreement [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Credit facility borrowing capacity | $ 700,000,000 | |||||||||||||||||||||||||
Applicable interest rate under credit facility (percent) | 3.10% | 3.10% | 2.70% | |||||||||||||||||||||||
7.25% and 7.75% Senior Notes due 2018 and 2022, Respectively [Member] | Senior Notes [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Repayments made on debt | $ 64,500,000 | |||||||||||||||||||||||||
5.75% Senior Notes Due 2024 [Member] | Senior Notes [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Aggregate principal amount | $ 350,000,000 | $ 400,000,000 | $ 175,000,000 | 275,000,000 | ||||||||||||||||||||||
Debt issue price as percentage of principal (percent) | 100.50% | 102.00% | 103.625% | |||||||||||||||||||||||
Net proceeds for offering | $ 351,000,000 | $ 406,000,000 | $ 182,000,000 | $ 270,000,000 | ||||||||||||||||||||||
Debt instrument maturity date | Nov. 1, 2024 | |||||||||||||||||||||||||
Effective interest rate (percent) | 5.80% | |||||||||||||||||||||||||
Debt instrument interest rate (percent) | 5.75% | 5.75% | 5.75% | 5.75% | ||||||||||||||||||||||
Former 2022 Notes | Senior Notes [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Redemption price, (percent) | 102.583% | 103.875% | 103.875% | |||||||||||||||||||||||
Repayments made on debt | $ 78,000,000 | $ 52,000,000 | $ 104,000,000 | |||||||||||||||||||||||
Debt redeemed | $ 76,000,000 | $ 50,000,000 | $ 50,000,000 | $ 50,000,000 | ||||||||||||||||||||||
Effective interest rate (percent) | 7.90% | |||||||||||||||||||||||||
5.125% Senior Notes Due 2023 [Member] | Senior Notes [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Aggregate principal amount | $ 300,000,000 | |||||||||||||||||||||||||
Net proceeds for offering | $ 295,000,000 | |||||||||||||||||||||||||
Effective interest rate (percent) | 5.40% | |||||||||||||||||||||||||
Debt instrument interest rate (percent) | 5.125% | 5.125% | 5.125% | 5.125% | ||||||||||||||||||||||
Senior Notes; Due 2020 [Member] | Senior Notes [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Redemption price, (percent) | 104.063% | |||||||||||||||||||||||||
Repayments made on debt | $ 302,000,000 | |||||||||||||||||||||||||
Debt redeemed | $ 290,000,000 | |||||||||||||||||||||||||
2.00% Convertible Senior Subordinated Notes due 2043 [Member] | Senior Subordinated Notes [Member] | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||||
Aggregate principal amount | $ 320,000,000 | |||||||||||||||||||||||||
Effective interest rate (percent) | 6.00% | |||||||||||||||||||||||||
Debt instrument interest rate (percent) | 2.00% | 2.00% | 2.00% | |||||||||||||||||||||||
Debt instrument conversion rate | 27.2221 shares per $1,000 principal amount | |||||||||||||||||||||||||
Conversion of convertible debt | $ 319,400,000 | |||||||||||||||||||||||||
Conversion of convertible debt, net of tax (shares) | shares | 8,900,000 | |||||||||||||||||||||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities Due to Make-Whole Premium | shares | 200,000 | |||||||||||||||||||||||||
Incremental Common Shares Attributable to Dilutive Effect of Conversion of Debt Securities | shares | 8,600,000 | |||||||||||||||||||||||||
Repayments of Debt | $ 600,000 |
Long-term Debt - Senior Notes R
Long-term Debt - Senior Notes Redemption Prices (Details) - Senior Notes [Member] | 12 Months Ended |
Dec. 31, 2017 | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 101.00% |
5.125% Senior Notes Due 2023 [Member] | Redemption Period One [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 103.844% |
5.125% Senior Notes Due 2023 [Member] | Redemption Period Two [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 102.563% |
5.125% Senior Notes Due 2023 [Member] | Redemption Period Three [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 101.281% |
5.125% Senior Notes Due 2023 [Member] | Redemption Period Four [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 100.00% |
5.75% Senior Notes Due 2024 [Member] | Redemption Period One [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 102.875% |
5.75% Senior Notes Due 2024 [Member] | Redemption Period Two [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 101.917% |
5.75% Senior Notes Due 2024 [Member] | Redemption Period Three [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 100.958% |
5.75% Senior Notes Due 2024 [Member] | Redemption Period Four [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 100.00% |
5.75% Senior Notes Due 2025 [Member] | Redemption Period One [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 102.875% |
5.75% Senior Notes Due 2025 [Member] | Redemption Period Two [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 101.917% |
5.75% Senior Notes Due 2025 [Member] | Redemption Period Three [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 100.958% |
5.75% Senior Notes Due 2025 [Member] | Redemption Period Four [Member] | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, (percent) | 100.00% |
Long-term Debt - Schedule of No
Long-term Debt - Schedule of Notes Payable (Details) - Other Notes Payable [Member] - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||
Notes payable | $ 82.3 | $ 55.8 |
Notes Payable, Real Estate Sale / Leaseback Financing [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | 77.7 | 48.2 |
Notes Payable, LIBOR plus 2.5% Construction Financing [Member] | LIBOR [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 4.4 | $ 7.4 |
Effective interest rate (percent) | 3.90% | 3.10% |
Spread on variable rate (percent) | 2.50% | 2.50% |
Notes Payable, 6.80% Financing [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 0.2 | $ 0.2 |
Effective interest rate (percent) | 6.80% | 6.80% |
Minimum [Member] | Notes Payable, Real Estate Sale / Leaseback Financing [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate (percent) | 7.50% | 7.50% |
Maximum [Member] | Notes Payable, Real Estate Sale / Leaseback Financing [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate (percent) | 11.20% | 11.20% |
Self-Insured Risks - Textual (D
Self-Insured Risks - Textual (Details) $ in Millions | Dec. 31, 2017USD ($)claim | Dec. 31, 2016USD ($)claim |
Insurance [Abstract] | ||
Maximum first layer of insurance coverage funded | $ 28 | |
Self-insurance reserves included in Other current liabilities | $ 60.9 | $ 61 |
Number of individual claims covered by reserves | claim | 1,000 | 1,000 |
Self-Insured Risks - Changes in
Self-Insured Risks - Changes in Self-insurance Reserves (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Insurance [Abstract] | |||
Balance at beginning of period, gross | $ 171.4 | $ 142.1 | $ 134.3 |
Less: Reinsurance receivables | (41.4) | (26.6) | (26) |
Balance at beginning of period, net | 130 | 115.5 | 108.3 |
Increase for the provision of current year claims | 44.7 | 43.5 | 37.1 |
Decrease for the provision of prior year claims | (3) | (0.1) | (4.6) |
Expenses related to discontinued operations | (0.5) | (0.4) | (0.5) |
Payments related to current year claims | (5) | (5) | (4.7) |
Payments related to prior year claims | (35.1) | (23.5) | (22.5) |
Acquisitions | 0 | 0 | 2.4 |
Balance at end of period, net | 131.1 | 130 | 115.5 |
Add: Reinsurance receivables | 39.9 | 41.4 | 26.6 |
Balance at end of period, gross | $ 171 | $ 171.4 | $ 142.1 |
Redeemable Noncontrolling Int87
Redeemable Noncontrolling Interests - Table 1 (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Redeemable Noncontrolling Interest [Line Items] | |||
Balance at beginning of period | $ 138.3 | ||
Net income attributable to noncontrolling interests | 17.9 | $ 14.1 | $ 13.8 |
Distributions | (50.5) | (54.2) | (49) |
Change in fair value | (41) | (6.7) | (18.2) |
Balance at end of period | 220.9 | 138.3 | |
Redeemable Noncontrolling Interest [Member] | |||
Redeemable Noncontrolling Interest [Line Items] | |||
Balance at beginning of period | 138.3 | 121.1 | 84.7 |
Net income attributable to noncontrolling interests | 17.9 | 14.1 | 13.8 |
Distributions | (4.6) | (7.8) | (7.3) |
Contribution to joint venture | 2.3 | 0 | 0 |
Change in fair value | 67 | 10.9 | 29.9 |
Balance at end of period | $ 220.9 | $ 138.3 | $ 121.1 |
Redeemable Noncontrolling Int88
Redeemable Noncontrolling Interests - Table 2 (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Noncontrolling Interest [Abstract] | |||||||||||
Net income attributable to nonredeemable Noncontrolling Interest | $ 61.2 | $ 56.4 | $ 55.9 | ||||||||
Net income attributable to redeemable noncontrolling interest | 17.9 | 14.1 | 13.8 | ||||||||
Net income attributable to noncontrolling interest | $ 25.9 | $ 19.2 | $ 16.4 | $ 17.6 | $ 16.8 | $ 16.4 | $ 18.6 | $ 18.7 | $ 79.1 | $ 70.5 | $ 69.7 |
Redeemable Noncontrolling Int89
Redeemable Noncontrolling Interests Redeemable Noncontrolling Interests - Textuals (Details) - USD ($) | Feb. 21, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2014 |
Noncontrolling Interest [Line Items] | ||||
Redeemable noncontrolling interests | $ 220,900,000 | $ 138,300,000 | ||
EHHI [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Outstanding common stock of Holdings, Fair Value | $ 192,000,000 | |||
Home Health and Hospice Segment [Member] | EHHI [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Redeemable noncontrolling interests | $ 64,000,000 | |||
Subsidiary's common stock held by subsidiary 's management, Percent | 16.70% | |||
Subsequent Event [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | $ 0.056 | |||
Payments to settle the acquisition of Holdings common stock | $ 65,000,000 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets and Liabilities Measured on a Recurring Basis (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Current portion of restricted marketable securities | $ 17.8 | $ 24.2 |
Restricted marketable securities | 44.2 | 33.5 |
Redeemable noncontrolling interests | 220.9 | 138.3 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Current portion of restricted marketable securities | 0 | 0 |
Restricted marketable securities | 0 | 0 |
Redeemable noncontrolling interests | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Current portion of restricted marketable securities | 17.8 | 24.2 |
Restricted marketable securities | 44.2 | 33.5 |
Redeemable noncontrolling interests | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Current portion of restricted marketable securities | 0 | 0 |
Restricted marketable securities | 0 | 0 |
Redeemable noncontrolling interests | $ 220.9 | $ 138.3 |
Fair Value Measurements - Textu
Fair Value Measurements - Textual (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Measurements, Nonrecurring [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Gains or losses in assets disclosed at fair value | $ 0 | $ 0 | $ 0 |
Fair Value Measurements - Carry
Fair Value Measurements - Carrying Amounts and Estimated Fair Values of Financial Instruments (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Other Notes Payable [Member] | Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | $ 82.3 | $ 55.8 |
Other Notes Payable [Member] | Estimated Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 82.3 | 55.8 |
Revolving Credit Facility [Member] | Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 95 | 152 |
Revolving Credit Facility [Member] | Estimated Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 95 | 152 |
Letter of Credit [Member] | Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 0 | 0 |
Letter of Credit [Member] | Estimated Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 35.4 | 33.3 |
Term Loan Facilities [Member] | Term Loan Facilities [Member] | Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 294.7 | 421.2 |
Term Loan Facilities [Member] | Term Loan Facilities [Member] | Estimated Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 296.3 | 422.5 |
5.125% Senior Notes Due 2023 [Member] | Senior Notes [Member] | Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 295.9 | 295.3 |
5.125% Senior Notes Due 2023 [Member] | Senior Notes [Member] | Estimated Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 306.8 | 297.8 |
5.75% Senior Notes Due 2024 [Member] | Senior Notes [Member] | Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 1,193.9 | 1,193.2 |
5.75% Senior Notes Due 2024 [Member] | Senior Notes [Member] | Estimated Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 1,228.5 | 1,216.6 |
5.75% Senior Notes Due 2025 [Member] | Senior Notes [Member] | Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 344.4 | 343.9 |
5.75% Senior Notes Due 2025 [Member] | Senior Notes [Member] | Estimated Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 364.9 | 349.6 |
2.00% Convertible Senior Subordinated Notes due 2043 [Member] | Senior Subordinated Notes [Member] | Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | 0 | 275.7 |
2.00% Convertible Senior Subordinated Notes due 2043 [Member] | Senior Subordinated Notes [Member] | Estimated Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying amounts and estimated fair values of financial instruments | $ 0 | $ 382.6 |
Share-Based Payments - Textual
Share-Based Payments - Textual (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average fair value per share (in dollars per share) | $ 11.55 | $ 11.55 | $ 15.11 |
Unrecognized compensation cost | $ 1.3 | ||
Intrinsic value of stock options exercised | $ 29 | $ 9.1 | $ 4.2 |
2008 Amended and Restated Equity Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares authorized for grant under the Plan (shares) | 9,000,000 | 9,000,000 | |
2016 Omnibus Performance Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares authorized for grant under the Plan (shares) | 14,000,000 | ||
Stock Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expiration period | 10 years | ||
Vesting period | 3 years | ||
Share-based compensation expense | $ 0.8 | $ 1.6 | $ 1.6 |
Weighted-average recognition period for unrecognized compensation cost | 23 months | ||
Employment Based SARS [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares granted during the period (shares) | 122,976 | ||
Stock Appreciation Rights (SARs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 26 | $ 5.8 | 3.5 |
Weighted-average recognition period for unrecognized compensation cost | 27 months | ||
Unrecognized compensation cost related to unvested SARs | $ 15 | ||
Weighted-average fair value per share of awards granted (in dollars per share) | $ 199.41 | $ 84.33 | |
Outstanding awards (shares) | 252,100 | ||
Performance and Employment Based SARS [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares granted during the period (shares) | 129,124 | ||
Restricted Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 19.6 | $ 18.7 | $ 19.5 |
Weighted-average recognition period for unrecognized compensation cost | 21 months | ||
Unrecognized compensation cost related to unvested SARs | $ 24 | ||
Weighted-average fair value per share of awards granted (in dollars per share) | $ 42.85 | $ 33.56 | $ 27.86 |
Fair value of vested shares | $ 17.7 | $ 24.3 | $ 41 |
Awards issued during period (shares) | 504,000 | ||
Non-employee Directors [Member] | Restricted Stock Units (RSUs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average fair value per share of awards granted (in dollars per share) | $ 47.30 | $ 40.75 | $ 42.46 |
Outstanding awards (shares) | 471,696 | ||
Awards issued during period (shares) | 27,594 | 32,031 | 30,744 |
Compensation expense recognized | $ 1.3 | $ 1.3 | $ 1.3 |
Unrecognized compensation cost | $ 0 | ||
Non-employee Directors [Member] | Dividend Equivalent, RSU [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Awards issued during period (shares) | 9,968 | 10,248 | 7,645 |
Share-Based Payments - Weighted
Share-Based Payments - Weighted-average Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Stock Options [Member] | |||
Schedule of Weighted Average Assumptions Used to Determine Fair Value of Stock Options | |||
Expected volatility (percent) | 30.50% | 37.20% | 39.50% |
Risk-free interest rate (percent) | 2.10% | 1.60% | 1.90% |
Expected life (years) | 7 years 8 months | 7 years 6 months | 7 years 8 months 12 days |
Dividend yield (percent) | 2.20% | 2.10% | 2.10% |
Stock Appreciation Rights (SARs) [Member] | |||
Schedule of Weighted Average Assumptions Used to Determine Fair Value of Stock Options | |||
Expected volatility (percent) | 28.70% | 25.90% | |
Risk-free interest rate (percent) | 1.90% | 1.90% | |
Expected life (years) | 2 years 1 month | 5 years 3 months | |
Dividend yield (percent) | 0.00% | 0.00% |
Share-Based Payments - Stock Op
Share-Based Payments - Stock Option Activity (Details) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($)$ / sharesshares | |
Summary of stock option activity and related information | |
Outstanding, December 31, 2016, Shares | shares | 1,575 |
Outstanding, December 31, 2016, Weighted-Average Exercise Price Per Share | $ / shares | $ 21.45 |
Granted, Shares | shares | 95 |
Granted, Weighted-Average Exercise Price Per Share | $ / shares | $ 42.22 |
Exercised (shares) | shares | (1,107) |
Exercised, Weighted-Average Exercise Price Per Share | $ / shares | $ 18.58 |
Forfeitures, Shares | shares | (3) |
Forfeiture, Weighted Average Exercise price Per Share | $ / shares | $ 43.14 |
Expirations, Shares | shares | (3) |
Expirations, Weighted-Average Exercise Price Per Share | $ / shares | $ 23.19 |
Outstanding, December 31, 2017, Shares | shares | 557 |
Outstanding, December 31, 2017, Weighted-Average Exercise Price Per Share | $ / shares | $ 30.53 |
Outstanding, December 31, 2017, Remaining Life | 6 years |
Outstanding, December 31, 2017, Aggregate Intrinsic Value | $ | $ 10.5 |
Exercisable, December 31, 2017, Shares | shares | 377 |
Exercisable, December 31, 2017, Weighted-Average Exercise Price Per Share | $ / shares | $ 25.81 |
Exercisable, December 31, 2017, Remaining Life | 4 years 7 months |
Exercisable, December 31, 2017, Aggregate Intrinsic Value | $ | $ 8.9 |
Share-Based Payments - Summary
Share-Based Payments - Summary of Restricted Stock Awards (Details) - Restricted Stock [Member] - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |||
Nonvested shares, Beginning Balance, Shares | 618 | ||
Nonvested shares, Beginning Balance, Weighted-Average Grant Date Fair Value | $ 35.06 | ||
Granted, Shares | 504 | ||
Granted, Weighted-Average Grant Date Fair Value | $ 42.85 | $ 33.56 | $ 27.86 |
Vested, Shares | (427) | ||
Vested, Weighted-Average Grant Date Fair Value | $ 34.83 | ||
Forfeited, Shares | (22) | ||
Forfeited, Weighted-Average Grant Date Fair Value | $ 39.22 | ||
Nonvested shares, Ending Balance, Shares | 673 | 618 | |
Nonvested shares, Ending Balance, Weighted-Average Grant Date Fair Value | $ 40.90 | $ 35.06 |
Employee Benefit Plans - Textua
Employee Benefit Plans - Textual (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017USD ($)yr | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Defined Contribution Plan Disclosure [Line Items] | |||
Company healthcare plan costs, net of employee payments | $ 120.8 | $ 119 | $ 109.3 |
Payments under the Senior Management Bonus Program | $ 15.1 | 11.2 | 9.4 |
Encompass Health Retirement Investment Plan [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Contribution as percentage of salary allowed under the Plan (percent) | 100.00% | ||
Employer match criteria | 50% of the first 6% of each participant’s elective deferrals | ||
Age requirement to participate in the Plan | yr | 21 | ||
Vesting percentage in employer contributions (percent) | 100.00% | ||
Vesting period | 3 | ||
Employer contributions | $ 18.2 | 16.6 | 15 |
Forfeitures used to fund the matching contributions | $ 1.4 | $ 0.6 | $ 0.9 |
Income Taxes - Components of Pr
Income Taxes - Components of Provision for Income Tax Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||||||||||
Federal | $ 72.2 | $ 16.1 | $ 2.6 | ||||||||
State and other | 12.8 | 14.9 | 12.2 | ||||||||
Total current expense | 85 | 31 | 14.8 | ||||||||
Deferred: | |||||||||||
Federal | 74.2 | 130.5 | 113.9 | ||||||||
State and other | 1.4 | 2.4 | 13.2 | ||||||||
Total deferred expense | 75.6 | 132.9 | 127.1 | ||||||||
Total income tax expense related to continuing operations | $ 49.2 | $ 43.1 | $ 28.6 | $ 39.7 | $ 39.7 | $ 42.1 | $ 42.4 | $ 39.7 | $ 160.6 | $ 163.9 | $ 141.9 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Effective Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Tax expense at statutory rate (percent) | 35.00% | 35.00% | 35.00% |
Increase (decrease) in tax rate resulting from: | |||
State and other income taxes, net of federal tax benefit (percent) | 3.50% | 3.80% | 3.60% |
Increase (decrease) in valuation allowance (percent) | 0.40% | 0.10% | 1.20% |
Noncontrolling interests (percent) | (4.60%) | (4.40%) | (5.30%) |
Share-based windfall tax benefits (percent) | (1.80%) | 0.00% | 0.00% |
Other, net (percent) | (0.10%) | (0.50%) | 1.40% |
Income tax expense (percent) | 32.40% | 34.00% | 35.90% |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Asset and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred income tax assets: | ||
Net operating loss | $ 77.3 | $ 64.8 |
Property, net | 36.3 | 52.1 |
Insurance reserve | 19.9 | 32 |
Stock-based compensation | 19.5 | 23.7 |
Allowance for doubtful accounts | 14 | 19.3 |
Alternative minimum tax | 0 | 7.5 |
Carrying value of partnerships | 0 | 12.9 |
Other accruals | 20.4 | 26.1 |
Tax credits | 2.8 | 2.6 |
Noncontrolling interest | 26.3 | 14.8 |
Other | 0.5 | 0.8 |
Total deferred income tax assets | 217 | 256.6 |
Less: Valuation allowance | (35.8) | (27.9) |
Net deferred income tax assets | 181.2 | 228.7 |
Deferred income tax liabilities: | ||
Deferred revenue | (28.9) | 0 |
Intangibles | (80) | (113.2) |
Convertible debt interest | 0 | (38.1) |
Carrying value of partnerships | (6.2) | 0 |
Other | (2.5) | (1.6) |
Total deferred income tax liabilities | (117.6) | (152.9) |
Net deferred income tax assets | $ 63.6 | $ 75.8 |
Income Taxes - Textual (Details
Income Taxes - Textual (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Valuation Allowance [Line Items] | |||||
Tax Expense or Benefit Resulting from the Tax Cuts and Jobs Act | $ 1.2 | ||||
Bonus Depreciation Deductions, Tax Cuts and Jobs Act | 8.8 | ||||
Tax expense at statutory rate (percent) | 35.00% | 35.00% | 35.00% | ||
Income tax benefit allocated to Capital in excess of par value | $ (25.1) | $ (4.2) | $ (11.7) | ||
Estimated realization of additional tax benefits | 51.3 | 0.1 | 0.3 | ||
Unrecognized Tax Benefits, Increase Resulting from Current Period Tax Positions, Pre-Payment Claims Denials | 39 | ||||
Changes to valuation allowance during the period | 7.9 | 0.3 | 4.6 | ||
Remaining valuation allowance | 35.8 | 35.8 | 27.9 | ||
Unrecognized income tax benefits | 0.3 | 0.3 | 2.8 | 2.9 | $ 0.9 |
Unrecognized tax benefits, decrease | 2.5 | ||||
Unrecognized tax benefits that would have affected effective tax rate if recognized | 0.3 | 0.3 | $ 2.8 | $ 2.9 | |
Federal [Member] | |||||
Valuation Allowance [Line Items] | |||||
Income Tax Expense (Benefit), Continuing Operations, Adjustment of Deferred Tax (Asset) Liability | 10.1 | ||||
State [Member] | |||||
Valuation Allowance [Line Items] | |||||
Income Tax Expense (Benefit), Continuing Operations, Adjustment of Deferred Tax (Asset) Liability | 14.7 | ||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount, Tax Cuts and Jobs Act | 5.8 | ||||
Net operating loss | $ 77.3 | $ 77.3 |
Income Taxes - Reconciliatio102
Income Taxes - Reconciliation of Liability for Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Gross Unrecognized Income Tax Benefits | |||
Gross unrecognized income tax benefits, Beginning Balance | $ 2.8 | $ 2.9 | $ 0.9 |
Gross amount of increases in unrecognized tax benefits related to prior periods | 0.3 | 1.7 | |
Gross amount of decreases in unrecognized tax benefits related to prior periods | (0.4) | (0.4) | |
Gross amount of increases in unrecognized tax benefits related to current periods | 51.3 | 0.1 | 0.3 |
Gross amount of decreases in unrecognized tax benefits related to current periods | (0.1) | ||
Decreases in unrecognized tax benefits relating to settlements with taxing authorities | (2.1) | ||
Gross unrecognized income tax benefits, Ending Balance | 0.3 | 2.8 | 2.9 |
Accrued Interest and Penalties | |||
Unrecognized Tax Benefits, Accrued interest and penalties, Beginning Balance | 0 | 0 | 0 |
Gross amount of increases in unrecognized tax benefits related to prior periods | 0 | 0 | |
Gross amount of decreases in unrecognized tax benefits related to prior periods | 0 | 0 | |
Gross amount of increases in unrecognized tax benefits related to current period | 0 | 0 | |
Gross amount of decreases in unrecognized tax benefits related to current periods | 0 | ||
Decreases in unrecognized tax benefits relating to settlements with taxing authorities | 0 | ||
Unrecognized Tax Benefits, Accrued interest and penalties, Ending Balance | $ 0 | $ 0 | $ 0 |
Earnings Per Common Share - Com
Earnings Per Common Share - Computation of Basic and Diluted Earnings per Common Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Numerator: | |||||||||||
Income from continuing operations | $ 86.7 | $ 85.2 | $ 79.2 | $ 84.7 | $ 81.8 | $ 78.2 | $ 81.3 | $ 76.8 | $ 335.8 | $ 318.1 | $ 253.7 |
Less: Net income attributable to noncontrolling interests included in continuing operations | (79.1) | (70.5) | (69.7) | ||||||||
Less: Income allocated to participating securities | (0.8) | (0.8) | (1) | ||||||||
Less: Convertible perpetual preferred stock dividends | 0 | 0 | (1.6) | ||||||||
Income from continuing operations attributable to Encompass Health common shareholders | 255.9 | 246.8 | 181.4 | ||||||||
Loss from discontinued operations, net of tax, attributable to Encompass Health common shareholders | (0.4) | 0 | (0.9) | ||||||||
Net income attributable to Encompass Health common shareholders | $ 255.5 | $ 246.8 | $ 180.5 | ||||||||
Denominator: | |||||||||||
Basic weighted average common shares outstanding (shares) | 93.7 | 89.1 | 89.4 | ||||||||
Basic earnings per share attributable to Encompass Health common shareholders: | |||||||||||
Continuing operations (in dollars per share) | $ 0.62 | $ 0.67 | $ 0.70 | $ 0.75 | $ 0.73 | $ 0.69 | $ 0.70 | $ 0.65 | $ 2.73 | $ 2.77 | $ 2.03 |
Discontinued Operations (in dollars per share) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | (0.01) |
Net income (in dollars per share) | $ 0.62 | $ 0.67 | $ 0.70 | $ 0.75 | $ 0.73 | $ 0.69 | $ 0.70 | $ 0.65 | $ 2.73 | $ 2.77 | $ 2.02 |
Numerator: | |||||||||||
Income from continuing operations | $ 86.7 | $ 85.2 | $ 79.2 | $ 84.7 | $ 81.8 | $ 78.2 | $ 81.3 | $ 76.8 | $ 335.8 | $ 318.1 | $ 253.7 |
Less: Net income attributable to noncontrolling interests included in continuing operations | (79.1) | (70.5) | (69.7) | ||||||||
Add: Interest on convertible debt, net of tax | 4.6 | 9.7 | 9.4 | ||||||||
Add: Loss on extinguishment of convertible debt, net of tax | 6.2 | 0 | 0 | ||||||||
Income from continuing operations attributable to Encompass Health common shareholders | 267.5 | 257.3 | 193.4 | ||||||||
Loss from discontinued operations, net of tax, attributable to Encompass Health common shareholders | (0.4) | 0 | (0.9) | ||||||||
Net income attributable to Encompass Health common shareholders | $ 267.1 | $ 257.3 | $ 192.5 | ||||||||
Denominator: | |||||||||||
Diluted weighted average common shares outstanding (shares) | 99.3 | 99.5 | 101 | ||||||||
Diluted earnings per share attributable to Encompass Health common shareholders: | |||||||||||
Continuing operations (in dollars per share) | $ 0.61 | $ 0.67 | $ 0.70 | $ 0.70 | $ 0.68 | $ 0.64 | $ 0.65 | $ 0.61 | $ 2.69 | $ 2.59 | $ 1.92 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | (0.01) |
Net income (in dollars per share) | $ 0.61 | $ 0.67 | $ 0.70 | $ 0.70 | $ 0.68 | $ 0.64 | $ 0.65 | $ 0.61 | $ 2.69 | $ 2.59 | $ 1.91 |
Earnings per Common Share - Rec
Earnings per Common Share - Reconciliation Between Basic and Diluted Weighted-average Common Shares Outstanding (Details) - shares shares in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |||
Basic weighted average common shares outstanding (shares) | 93.7 | 89.1 | 89.4 |
Convertible perpetual preferred stock (shares) | 0 | 0 | 1 |
Convertible senior subordinated notes (shares) | 4 | 8.5 | 8.3 |
Restricted stock awards, dilutive stock options, and restricted stock units (shares) | 1.6 | 1.9 | 2.3 |
Diluted weighted average common shares outstanding (shares) | 99.3 | 99.5 | 101 |
Earnings Per Common Share - Tex
Earnings Per Common Share - Textual (Details) - USD ($) $ / shares in Units, $ in Millions | Feb. 23, 2018 | Jan. 16, 2018 | Oct. 20, 2017 | Oct. 16, 2017 | Jul. 20, 2017 | Oct. 17, 2016 | Jul. 21, 2016 | Oct. 15, 2015 | Jul. 16, 2015 | Apr. 22, 2015 | Oct. 15, 2014 | Jul. 17, 2014 | Sep. 30, 2009 | Jan. 17, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Apr. 23, 2015 | Feb. 14, 2014 | Dec. 31, 2013 |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||||||||||||||||||
Antidilutive shares excluded from computation of diluted weighted-average shares (shares) | 200,000 | 100,000 | ||||||||||||||||||
Common stock repurchased | $ 38.1 | $ 65.6 | $ 45.3 | |||||||||||||||||
Cash dividends declared per common share (in dollars per share) | $ 0.25 | $ 0.25 | $ 0.24 | $ 0.23 | $ 0.21 | $ 0.98 | $ 0.94 | $ 0.88 | ||||||||||||
Cash dividends paid per common share (dollars per share) | $ 0.25 | $ 0.24 | $ 0.23 | $ 0.21 | ||||||||||||||||
Preferred stock conversion rate (shares for each share) | $ 33.9905 | |||||||||||||||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||||||||||
Common stock issued (shares) | 5,000,000 | 700,000 | ||||||||||||||||||
Common stock warrants issued | 8,200,000 | 0 | 8,200,000 | |||||||||||||||||
Exercise price of warrants (in dollars per share) | $ 41.40 | $ 41.40 | $ 41.40 | |||||||||||||||||
Proceeds from exercising stock warrants | $ 26.7 | $ 26.6 | $ 0 | $ 0 | ||||||||||||||||
Subsequent Event [Member] | ||||||||||||||||||||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||||||||||||||||||
Cash dividends declared per common share (in dollars per share) | $ 0.25 | |||||||||||||||||||
Cash dividends paid per common share (dollars per share) | $ 0.25 | |||||||||||||||||||
Common Stock [Member] | ||||||||||||||||||||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||||||||||||||||||
Common stock repurchase authorization | $ 250 | $ 200 | ||||||||||||||||||
Common stock repurchased (shares) | 900,000 | 1,700,000 | 1,300,000 | |||||||||||||||||
Common stock repurchased | $ 38.1 | $ 65.6 | $ 45.3 | |||||||||||||||||
Accrued common stock dividends | $ 25.4 | $ 22.2 | ||||||||||||||||||
Common stock issued and delivered (shares) | 3,271,415 | |||||||||||||||||||
Convertible Preferred Stock [Member] | ||||||||||||||||||||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||||||||||||||||||
Convertible preferred stock par value (in dollars per share) | $ 0.10 | |||||||||||||||||||
Preferred stock liquidation preference (in dollars per share) | $ 1,000 | |||||||||||||||||||
Preferred stock outstanding (shares) | 96,245 |
Earnings per Common Share - Sch
Earnings per Common Share - Schedule of Warrant Activity (Details) - $ / shares shares in Millions | 1 Months Ended | ||
Jan. 17, 2017 | Dec. 31, 2016 | Sep. 30, 2009 | |
Class of Warrant or Right [Line Items] | |||
Common stock warrants outstanding as of December 31, 2016 | 8.2 | ||
Expired | (1.1) | ||
Common stock warrants outstanding as of January 17, 2017 | 0 | ||
Weighted average exercise price (in dollars per share) | $ 41.40 | $ 41.40 | $ 41.40 |
Cashless exercise [Member] | |||
Class of Warrant or Right [Line Items] | |||
Exercised | (6.5) | ||
Weighted average exercise price (in dollars per share) | $ 41.40 | ||
Cash exercise [Member] | |||
Class of Warrant or Right [Line Items] | |||
Exercised | (0.6) | ||
Weighted average exercise price (in dollars per share) | $ 41.40 |
Contingencies and Other Comm107
Contingencies and Other Commitments - Textual (Details) $ in Millions | May 18, 2016USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Feb. 28, 2015patient | Apr. 24, 2014facilities | Aug. 12, 2013facilities | Mar. 04, 2013facilitiespatient |
Other Commitments [Abstract] | |||||||
2,018 | $ 35.6 | ||||||
2,019 | 20.5 | ||||||
2,020 | 16.9 | ||||||
2,021 | 8.8 | ||||||
2,022 | 1.7 | ||||||
Thereafter | 2 | ||||||
HHS-OIG Investigation [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Number of additional patient medical records requested | patient | 70 | ||||||
Pending Litigation [Member] | Honts lawsuit [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Number of hospitals involved in lawsuit | facilities | 1 | ||||||
Verdict returned in favor of plaintiff | $ 20 | ||||||
Additional net charge recorded | $ 5.7 | ||||||
Liability recorded | 20.2 | ||||||
Receivable recorded for portion of liability expected to be covered by excess insurance coverages | 15.5 | ||||||
Maximum claim covered through captive insurance subsidiary | $ 6 | ||||||
Pending Litigation [Member] | HHS-OIG Investigation [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Number of hospitals that received subpoenas | facilities | 7 | 4 | |||||
Number of patient medical records requested for each hospital in subpoenas | patient | 100 | ||||||
Number of hospitals that received supplemental subpoenas | facilities | 2 | ||||||
Compliance threshold under Health Care Act (percent) | 60.00% |
Segment Reporting Segment Re108
Segment Reporting Segment Reporting - Textuals (Details) | Dec. 31, 2017statelocationfacilities |
Segment Reporting Information [Line Items] | |
Number of states in which Entity operates | state | 36 |
Inpatient Rehabilitation Segment [Member] | |
Segment Reporting Information [Line Items] | |
Number of states in which Entity operates | state | 31 |
Number of inpatient rehabilitation hospitals | 127 |
Number of Joint Venture hospitals accounted for using equity method of accounting | 1 |
Number of inpatient rehabilitation units under management contracts | 4 |
Home Health and Hospice Segment [Member] | |
Segment Reporting Information [Line Items] | |
Number of states in which Entity operates | state | 28 |
Number of Hospital Based Home Health and Hospice Agencies | location | 237 |
Number of Joint Venture Agencies Accounted for Using the Equity Method | 2 |
Segment Reporting Segment Re109
Segment Reporting Segment Reporting - Selected Financial Information of Reportable Segments (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||||||||||
Net operating revenues | $ 1,019.7 | $ 995.6 | $ 981.3 | $ 974.8 | $ 949.9 | $ 926.8 | $ 920.7 | $ 909.8 | $ 3,971.4 | $ 3,707.2 | $ 3,162.9 |
Less: Provision for doubtful accounts | (52.4) | (61.2) | (47.2) | ||||||||
Net operating revenues less provision for doubtful accounts | 3,919 | 3,646 | 3,115.7 | ||||||||
Operating expenses: | |||||||||||
Salaries and benefits | 2,154.6 | 1,985.9 | 1,670.8 | ||||||||
Other operating expenses | 536.7 | 492.1 | 432.1 | ||||||||
Supplies | 149.3 | 140 | 128.7 | ||||||||
Total segment level operating expenses | 3,269.6 | 2,997.2 | 2,569 | ||||||||
Other income | (4.1) | (2.9) | (5.5) | ||||||||
Equity in net income of nonconsolidated affiliates | (8) | (9.8) | (8.7) | ||||||||
Noncontrolling interests | $ (25.9) | $ (19.2) | $ (16.4) | $ (17.6) | $ (16.8) | $ (16.4) | $ (18.6) | $ (18.7) | (79.1) | (70.5) | (69.7) |
Inpatient Rehabilitation Segment [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net operating revenues | 3,188.1 | 3,021.1 | 2,653.1 | ||||||||
Less: Provision for doubtful accounts | (46.8) | (57) | (44.7) | ||||||||
Net operating revenues less provision for doubtful accounts | 3,141.3 | 2,964.1 | 2,608.4 | ||||||||
Operating expenses: | |||||||||||
Salaries and benefits | 1,603.8 | 1,493.4 | 1,310.6 | ||||||||
Other operating expenses | 462.5 | 431.5 | 387.7 | ||||||||
Supplies | 135.7 | 128.8 | 120.9 | ||||||||
Occupancy costs | 61.9 | 61.2 | 46.2 | ||||||||
Cost of services sold (excluding depreciation and amortization) | 0 | 0 | 0 | ||||||||
Support and overhead costs | 0 | 0 | 0 | ||||||||
Total segment level operating expenses | 2,263.9 | 2,114.9 | 1,865.4 | ||||||||
Other income | (4.1) | (2.9) | (2.3) | ||||||||
Equity in net income of nonconsolidated affiliates | (7.3) | (9.1) | (8.6) | ||||||||
Noncontrolling interests | 67.6 | 64 | 62.9 | ||||||||
Segment Adjusted EBITDA | 821.2 | 797.2 | 691 | ||||||||
Capital expenditures | 238 | 198.3 | 151.7 | ||||||||
Home Health and Hospice Segment [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net operating revenues | 783.3 | 686.1 | 509.8 | ||||||||
Less: Provision for doubtful accounts | (5.6) | (4.2) | (2.5) | ||||||||
Net operating revenues less provision for doubtful accounts | 777.7 | 681.9 | 507.3 | ||||||||
Operating expenses: | |||||||||||
Salaries and benefits | 0 | 0 | 0 | ||||||||
Other operating expenses | 0 | 0 | 0 | ||||||||
Supplies | 0 | 0 | 0 | ||||||||
Occupancy costs | 0 | 0 | 0 | ||||||||
Cost of services sold (excluding depreciation and amortization) | 368.4 | 336.5 | 244.8 | ||||||||
Support and overhead costs | 277.2 | 237.2 | 172.7 | ||||||||
Total segment level operating expenses | 645.6 | 573.7 | 417.5 | ||||||||
Other income | 0 | 0 | 0 | ||||||||
Equity in net income of nonconsolidated affiliates | (0.7) | (0.7) | (0.1) | ||||||||
Noncontrolling interests | 6.9 | 6.5 | 6.8 | ||||||||
Segment Adjusted EBITDA | 125.9 | 102.4 | 83.1 | ||||||||
Capital expenditures | $ 10.7 | $ 8.7 | $ 5.8 |
Segment Reporting Segment Re110
Segment Reporting Segment Reporting - Reconciliation of Segment Assets and Investments to Consolidated Amounts (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | |
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | [1] | $ 4,893.7 | $ 4,681.9 |
Investments in and advances to nonconsolidated affiliates | 11.9 | 13 | |
Inpatient Rehabilitation Segment [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 3,789.1 | 3,629.6 | |
Investments in and advances to nonconsolidated affiliates | 9.3 | 10.6 | |
Home Health and Hospice Segment [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 1,150.5 | 1,123.7 | |
Investments in and advances to nonconsolidated affiliates | $ 2.6 | $ 2.4 | |
[1] | Our consolidated assets as of December 31, 2017 and December 31, 2016 include total assets of variable interest entities of $264.1 million and $262.3 million, respectively, which cannot be used by us to settle the obligations of other entities. Our consolidated liabilities as of December 31, 2017 and December 31, 2016 include total liabilities of the variable interest entities of $52.5 million and $50.3 million, respectively. See Note 3, Variable Interest Entities. |
Segment Reporting Segment Re111
Segment Reporting Segment Reporting - Reconciliation of Adjusted EBITDA (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||
General and administrative expenses | $ (171.7) | $ (133.4) | $ (133.3) | ||||||||
Depreciation and amortization | (183.8) | (172.6) | (139.7) | ||||||||
Government, class action, and related settlements | 0 | 0 | (7.5) | ||||||||
Professional fees—accounting, tax, and legal | 0 | (1.9) | (3) | ||||||||
Loss on early extinguishment of debt | (10.7) | (7.4) | (22.4) | ||||||||
Net income attributable to noncontrolling interests | $ 25.9 | $ 19.2 | $ 16.4 | $ 17.6 | $ 16.8 | $ 16.4 | $ 18.6 | $ 18.7 | 79.1 | 70.5 | 69.7 |
Income from continuing operations before income tax expense | 496.4 | 482 | 395.6 | ||||||||
Inpatient Rehabilitation Hospital and Home Health and Hospice [Member] | |||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||
Total segment Adjusted EBITDA | 947.1 | 899.6 | 774.1 | ||||||||
Segment Reconciling Items [Member] | |||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||
General and administrative expenses | (171.7) | (133.4) | (133.3) | ||||||||
Depreciation and amortization | (183.8) | (172.6) | (139.7) | ||||||||
Loss on disposal of assets | (4.6) | (0.7) | (2.6) | ||||||||
Government, class action, and related settlements | 0 | 0 | (7.5) | ||||||||
Professional fees—accounting, tax, and legal | 0 | (1.9) | (3) | ||||||||
Loss on early extinguishment of debt | (10.7) | (7.4) | (22.4) | ||||||||
Interest expense and amortization of debt discounts and fees | (154.4) | (172.1) | (142.9) | ||||||||
Net income attributable to noncontrolling interests | 79.1 | 70.5 | 69.7 | ||||||||
Tax reform impact on noncontrolling interests | (4.6) | 0 | 0 | ||||||||
Gain related to SCA equity interest | $ 0 | $ 0 | $ 3.2 |
Segment Reporting Segment Re112
Segment Reporting Segment Reporting - Reconciliation of reportable to Consolidated Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | ||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets for reportable segments | [1] | $ 4,893.7 | $ 4,681.9 |
Reclassification of noncurrent deferred income tax liabilities to net noncurrent deferred income tax assets | (45.9) | (71.4) | |
Total assets | [1] | 4,893.7 | 4,681.9 |
Inpatient Rehabilitation Hospital and Home Health and Hospice [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets for reportable segments | 4,939.6 | 4,753.3 | |
Total assets | $ 4,939.6 | $ 4,753.3 | |
[1] | Our consolidated assets as of December 31, 2017 and December 31, 2016 include total assets of variable interest entities of $264.1 million and $262.3 million, respectively, which cannot be used by us to settle the obligations of other entities. Our consolidated liabilities as of December 31, 2017 and December 31, 2016 include total liabilities of the variable interest entities of $52.5 million and $50.3 million, respectively. See Note 3, Variable Interest Entities. |
Segment Reporting Segment Re113
Segment Reporting Segment Reporting - Revenues of Operating Segments by Service Line (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Net operating revenues | $ 1,019.7 | $ 995.6 | $ 981.3 | $ 974.8 | $ 949.9 | $ 926.8 | $ 920.7 | $ 909.8 | $ 3,971.4 | $ 3,707.2 | $ 3,162.9 |
Inpatient Rehabilitation Segment [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Net operating revenues | 3,188.1 | 3,021.1 | 2,653.1 | ||||||||
Inpatient Rehabilitation Segment [Member] | Inpatient [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Net operating revenues | 3,082.4 | 2,905.5 | 2,547.2 | ||||||||
Inpatient Rehabilitation Segment [Member] | Outpatient and other [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Net operating revenues | 105.7 | 115.6 | 105.9 | ||||||||
Home Health and Hospice Segment [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Net operating revenues | 783.3 | 686.1 | 509.8 | ||||||||
Home Health and Hospice Segment [Member] | Home health [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Net operating revenues | 706.7 | 635.2 | 478.1 | ||||||||
Home Health and Hospice Segment [Member] | Hospice [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Net operating revenues | $ 76.6 | $ 50.9 | $ 31.7 |
Quarterly Data (Unaudited) - Sc
Quarterly Data (Unaudited) - Schedule of Quarterly Data (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Data | |||||||||||
Net operating revenues | $ 1,019.7 | $ 995.6 | $ 981.3 | $ 974.8 | $ 949.9 | $ 926.8 | $ 920.7 | $ 909.8 | $ 3,971.4 | $ 3,707.2 | $ 3,162.9 |
Operating earnings | 144.7 | 145.2 | 141.3 | 147.1 | 145.5 | 148.2 | 150.2 | 144.2 | 578.3 | 588.1 | |
Provision for income tax expense | 49.2 | 43.1 | 28.6 | 39.7 | 39.7 | 42.1 | 42.4 | 39.7 | 160.6 | 163.9 | 141.9 |
Income from continuing operations | 86.7 | 85.2 | 79.2 | 84.7 | 81.8 | 78.2 | 81.3 | 76.8 | 335.8 | 318.1 | 253.7 |
(Loss) income from discontinued operations, net of tax | (0.2) | (0.1) | 0.2 | (0.3) | 0.3 | (0.1) | (0.1) | (0.1) | (0.4) | 0 | (0.9) |
Net income | 86.5 | 85.1 | 79.4 | 84.4 | 82.1 | 78.1 | 81.2 | 76.7 | 335.4 | 318.1 | 252.8 |
Less: Net income attributable to noncontrolling interests | (25.9) | (19.2) | (16.4) | (17.6) | (16.8) | (16.4) | (18.6) | (18.7) | (79.1) | (70.5) | (69.7) |
Net income attributable to Encompass Health | $ 60.6 | $ 65.9 | $ 63 | $ 66.8 | $ 65.3 | $ 61.7 | $ 62.6 | $ 58 | $ 256.3 | $ 247.6 | $ 183.1 |
Basic earnings (loss) per share attributable to HealthSouth common shareholders: | |||||||||||
Continuing operations (in dollars per share) | $ 0.62 | $ 0.67 | $ 0.70 | $ 0.75 | $ 0.73 | $ 0.69 | $ 0.70 | $ 0.65 | $ 2.73 | $ 2.77 | $ 2.03 |
Discontinued Operations (in dollars per share) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | (0.01) |
Net income (in dollars per share) | 0.62 | 0.67 | 0.70 | 0.75 | 0.73 | 0.69 | 0.70 | 0.65 | 2.73 | 2.77 | 2.02 |
Diluted earnings (loss) per share attributable to HealthSouth common shareholders: | |||||||||||
Continuing operations (in dollars per share) | 0.61 | 0.67 | 0.70 | 0.70 | 0.68 | 0.64 | 0.65 | 0.61 | 2.69 | 2.59 | 1.92 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | (0.01) |
Net income (in dollars per share) | $ 0.61 | $ 0.67 | $ 0.70 | $ 0.70 | $ 0.68 | $ 0.64 | $ 0.65 | $ 0.61 | $ 2.69 | $ 2.59 | $ 1.91 |
Condensed Consolidating Fina115
Condensed Consolidating Financial Information - Textual (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Encompass Health ownership percentage of subsidiary guarantors (percent) | 100.00% |
Senior secured leverage ratio maximum | 2 |
Consolidated coverage ratio minimum | 2 |
Condensed Consolidating Fina116
Condensed Consolidating Financial Information - Condensed Consolidating Statement of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Condensed Consolidating Statements of Operations | |||||||||||
Net operating revenues | $ 1,019.7 | $ 995.6 | $ 981.3 | $ 974.8 | $ 949.9 | $ 926.8 | $ 920.7 | $ 909.8 | $ 3,971.4 | $ 3,707.2 | $ 3,162.9 |
Less: Provision for doubtful accounts | (52.4) | (61.2) | (47.2) | ||||||||
Net operating revenues less provision for doubtful accounts | 3,919 | 3,646 | 3,115.7 | ||||||||
Operating expenses: | |||||||||||
Salaries and benefits | 2,154.6 | 1,985.9 | 1,670.8 | ||||||||
Other operating expenses | 536.7 | 492.1 | 432.1 | ||||||||
Occupancy costs | 73.5 | 71.3 | 53.9 | ||||||||
Supplies | 149.3 | 140 | 128.7 | ||||||||
General and administrative expenses | 171.7 | 133.4 | 133.3 | ||||||||
Depreciation and amortization | 183.8 | 172.6 | 139.7 | ||||||||
Government, class action, and related settlements | 0 | 0 | 7.5 | ||||||||
Professional fees-accounting, tax, and legal | 0 | 1.9 | 3 | ||||||||
Total operating expenses | 3,269.6 | 2,997.2 | 2,569 | ||||||||
Loss on early extinguishment of debt | 10.7 | 7.4 | 22.4 | ||||||||
Interest expense and amortization of debt discounts and fees | 154.4 | 172.1 | 142.9 | ||||||||
Other (income) loss | (4.1) | (2.9) | (5.5) | ||||||||
Equity in net income of nonconsolidated affiliates | (8) | (9.8) | (8.7) | ||||||||
Equity in net income of consolidated affiliates | 0 | 0 | 0 | ||||||||
Management fees | 0 | 0 | 0 | ||||||||
Income from continuing operations before income tax expense | 496.4 | 482 | 395.6 | ||||||||
Provision for income tax expense | 49.2 | 43.1 | 28.6 | 39.7 | 39.7 | 42.1 | 42.4 | 39.7 | 160.6 | 163.9 | 141.9 |
Income from continuing operations | 86.7 | 85.2 | 79.2 | 84.7 | 81.8 | 78.2 | 81.3 | 76.8 | 335.8 | 318.1 | 253.7 |
Income (loss) from discontinued operations, net of tax | (0.2) | (0.1) | 0.2 | (0.3) | 0.3 | (0.1) | (0.1) | (0.1) | (0.4) | 0 | (0.9) |
Net income | 86.5 | 85.1 | 79.4 | 84.4 | 82.1 | 78.1 | 81.2 | 76.7 | 335.4 | 318.1 | 252.8 |
Less: Net income attributable to noncontrolling interests | (25.9) | (19.2) | (16.4) | (17.6) | (16.8) | (16.4) | (18.6) | (18.7) | (79.1) | (70.5) | (69.7) |
Net income attributable to Encompass Health | $ 60.6 | $ 65.9 | $ 63 | $ 66.8 | $ 65.3 | $ 61.7 | $ 62.6 | $ 58 | 256.3 | 247.6 | 183.1 |
Comprehensive income | 335.3 | 318.1 | 252.1 | ||||||||
Comprehensive income attributable to Encompass Health | 256.2 | 247.6 | 182.4 | ||||||||
Eliminating Entries | |||||||||||
Condensed Consolidating Statements of Operations | |||||||||||
Net operating revenues | (126.1) | (117.9) | (103.5) | ||||||||
Less: Provision for doubtful accounts | 0 | 0 | 0 | ||||||||
Net operating revenues less provision for doubtful accounts | (126.1) | (117.9) | (103.5) | ||||||||
Operating expenses: | |||||||||||
Salaries and benefits | (21) | (18.3) | (17.1) | ||||||||
Other operating expenses | (48.6) | (46.3) | (41.3) | ||||||||
Occupancy costs | (56.5) | (53.3) | (45.1) | ||||||||
Supplies | 0 | 0 | 0 | ||||||||
General and administrative expenses | 0 | 0 | 0 | ||||||||
Depreciation and amortization | 0 | 0 | 0 | ||||||||
Government, class action, and related settlements | 0 | ||||||||||
Professional fees-accounting, tax, and legal | 0 | 0 | |||||||||
Total operating expenses | (126.1) | (117.9) | (103.5) | ||||||||
Loss on early extinguishment of debt | 0 | 0 | 0 | ||||||||
Interest expense and amortization of debt discounts and fees | (21) | (19.9) | (11.4) | ||||||||
Other (income) loss | 21 | 19.9 | 11.4 | ||||||||
Equity in net income of nonconsolidated affiliates | 0 | 0 | 0 | ||||||||
Equity in net income of consolidated affiliates | 381.9 | 388.4 | 360.7 | ||||||||
Management fees | 0 | 0 | 0 | ||||||||
Income from continuing operations before income tax expense | (381.9) | (388.4) | (360.7) | ||||||||
Provision for income tax expense | 0 | 0 | 0 | ||||||||
Income from continuing operations | (381.9) | (388.4) | (360.7) | ||||||||
Income (loss) from discontinued operations, net of tax | 0 | 0 | 0 | ||||||||
Net income | (381.9) | (388.4) | (360.7) | ||||||||
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | ||||||||
Net income attributable to Encompass Health | (381.9) | (388.4) | (360.7) | ||||||||
Comprehensive income | (381.9) | (388.4) | (360.7) | ||||||||
Comprehensive income attributable to Encompass Health | (381.9) | (388.4) | (360.7) | ||||||||
Encompass Health Corporation | |||||||||||
Condensed Consolidating Statements of Operations | |||||||||||
Net operating revenues | 21.3 | 20.1 | 19.4 | ||||||||
Less: Provision for doubtful accounts | 0 | 0 | 0 | ||||||||
Net operating revenues less provision for doubtful accounts | 21.3 | 20.1 | 19.4 | ||||||||
Operating expenses: | |||||||||||
Salaries and benefits | 34.7 | 45.5 | 49.4 | ||||||||
Other operating expenses | 32.8 | 25.5 | 31.3 | ||||||||
Occupancy costs | 1.9 | 2.9 | 4 | ||||||||
Supplies | 0 | 0 | 0 | ||||||||
General and administrative expenses | 143.7 | 126.7 | 128.3 | ||||||||
Depreciation and amortization | 8.8 | 9.4 | 9.9 | ||||||||
Government, class action, and related settlements | 7.5 | ||||||||||
Professional fees-accounting, tax, and legal | 1.9 | 3 | |||||||||
Total operating expenses | 221.9 | 211.9 | 233.4 | ||||||||
Loss on early extinguishment of debt | 10.7 | 7.4 | 22.4 | ||||||||
Interest expense and amortization of debt discounts and fees | 130.5 | 147.3 | 130 | ||||||||
Other (income) loss | (21.7) | (19.6) | (13.6) | ||||||||
Equity in net income of nonconsolidated affiliates | 0 | 0 | 0 | ||||||||
Equity in net income of consolidated affiliates | (341.6) | (347.2) | (320.4) | ||||||||
Management fees | (145) | (136.2) | (119.7) | ||||||||
Income from continuing operations before income tax expense | 166.5 | 156.5 | 87.3 | ||||||||
Provision for income tax expense | (90.2) | (91.1) | (96.9) | ||||||||
Income from continuing operations | 256.7 | 247.6 | 184.2 | ||||||||
Income (loss) from discontinued operations, net of tax | (0.4) | 0 | (1.1) | ||||||||
Net income | 256.3 | 247.6 | 183.1 | ||||||||
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | ||||||||
Net income attributable to Encompass Health | 256.3 | 247.6 | 183.1 | ||||||||
Comprehensive income | 256.2 | 247.6 | 182.4 | ||||||||
Comprehensive income attributable to Encompass Health | 256.2 | 247.6 | 182.4 | ||||||||
Guarantor Subsidiaries | |||||||||||
Condensed Consolidating Statements of Operations | |||||||||||
Net operating revenues | 2,258.7 | 2,171.7 | 1,871.6 | ||||||||
Less: Provision for doubtful accounts | (30.7) | (41.8) | (33.7) | ||||||||
Net operating revenues less provision for doubtful accounts | 2,228 | 2,129.9 | 1,837.9 | ||||||||
Operating expenses: | |||||||||||
Salaries and benefits | 1,077.4 | 1,006.1 | 866.7 | ||||||||
Other operating expenses | 321.8 | 309.8 | 266.2 | ||||||||
Occupancy costs | 93.4 | 89.8 | 66.9 | ||||||||
Supplies | 93.2 | 89.9 | 82.8 | ||||||||
General and administrative expenses | 0 | 0 | 0 | ||||||||
Depreciation and amortization | 103.4 | 102.8 | 82.8 | ||||||||
Government, class action, and related settlements | 0 | ||||||||||
Professional fees-accounting, tax, and legal | 0 | 0 | |||||||||
Total operating expenses | 1,689.2 | 1,598.4 | 1,365.4 | ||||||||
Loss on early extinguishment of debt | 0 | 0 | 0 | ||||||||
Interest expense and amortization of debt discounts and fees | 21.1 | 21.6 | 11.2 | ||||||||
Other (income) loss | 0.2 | (0.4) | (0.2) | ||||||||
Equity in net income of nonconsolidated affiliates | (7.3) | (9) | (8.5) | ||||||||
Equity in net income of consolidated affiliates | (40.3) | (41.2) | (40.3) | ||||||||
Management fees | 108.3 | 103.1 | 88.8 | ||||||||
Income from continuing operations before income tax expense | 456.8 | 457.4 | 421.5 | ||||||||
Provision for income tax expense | 182.3 | 182.6 | 168.2 | ||||||||
Income from continuing operations | 274.5 | 274.8 | 253.3 | ||||||||
Income (loss) from discontinued operations, net of tax | 0 | 0 | 0 | ||||||||
Net income | 274.5 | 274.8 | 253.3 | ||||||||
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | ||||||||
Net income attributable to Encompass Health | 274.5 | 274.8 | 253.3 | ||||||||
Comprehensive income | 274.5 | 274.8 | 253.3 | ||||||||
Comprehensive income attributable to Encompass Health | 274.5 | 274.8 | 253.3 | ||||||||
Non-Guarantor Subsidiaries | |||||||||||
Condensed Consolidating Statements of Operations | |||||||||||
Net operating revenues | 1,817.5 | 1,633.3 | 1,375.4 | ||||||||
Less: Provision for doubtful accounts | (21.7) | (19.4) | (13.5) | ||||||||
Net operating revenues less provision for doubtful accounts | 1,795.8 | 1,613.9 | 1,361.9 | ||||||||
Operating expenses: | |||||||||||
Salaries and benefits | 1,063.5 | 952.6 | 771.8 | ||||||||
Other operating expenses | 230.7 | 203.1 | 175.9 | ||||||||
Occupancy costs | 34.7 | 31.9 | 28.1 | ||||||||
Supplies | 56.1 | 50.1 | 45.9 | ||||||||
General and administrative expenses | 28 | 6.7 | 5 | ||||||||
Depreciation and amortization | 71.6 | 60.4 | 47 | ||||||||
Government, class action, and related settlements | 0 | ||||||||||
Professional fees-accounting, tax, and legal | 0 | 0 | |||||||||
Total operating expenses | 1,484.6 | 1,304.8 | 1,073.7 | ||||||||
Loss on early extinguishment of debt | 0 | 0 | 0 | ||||||||
Interest expense and amortization of debt discounts and fees | 23.8 | 23.1 | 13.1 | ||||||||
Other (income) loss | (3.6) | (2.8) | (3.1) | ||||||||
Equity in net income of nonconsolidated affiliates | (0.7) | (0.8) | (0.2) | ||||||||
Equity in net income of consolidated affiliates | 0 | 0 | 0 | ||||||||
Management fees | 36.7 | 33.1 | 30.9 | ||||||||
Income from continuing operations before income tax expense | 255 | 256.5 | 247.5 | ||||||||
Provision for income tax expense | 68.5 | 72.4 | 70.6 | ||||||||
Income from continuing operations | 186.5 | 184.1 | 176.9 | ||||||||
Income (loss) from discontinued operations, net of tax | 0 | 0 | 0.2 | ||||||||
Net income | 186.5 | 184.1 | 177.1 | ||||||||
Less: Net income attributable to noncontrolling interests | (79.1) | (70.5) | (69.7) | ||||||||
Net income attributable to Encompass Health | 107.4 | 113.6 | 107.4 | ||||||||
Comprehensive income | 186.5 | 184.1 | 177.1 | ||||||||
Comprehensive income attributable to Encompass Health | $ 107.4 | $ 113.6 | $ 107.4 |
Condensed Consolidating Fina117
Condensed Consolidating Financial Information - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current assets: | |||||
Cash & Cash Equivalents | $ 54.4 | $ 40.5 | $ 61.6 | $ 66.7 | |
Restricted cash | 62.4 | 60.9 | |||
Accounts receivable, net | 472.1 | 443.8 | |||
Prepaid expenses and other current assets | 113.3 | 109.3 | |||
Total current assets | 702.2 | 654.5 | |||
Property and equipment, net | 1,517.1 | 1,391.8 | |||
Goodwill | 1,972.6 | 1,927.2 | 1,890.1 | 1,084 | |
Intangible assets, net | 403.1 | 411.3 | |||
Deferred income tax assets | 63.6 | 75.8 | |||
Other long-term assets | 235.1 | 221.3 | |||
Intercompany notes receivable | 0 | 0 | |||
Intercompany receivable and investments in consolidated affiliates | 0 | 0 | |||
Total assets | [1] | 4,893.7 | 4,681.9 | ||
Current liabilities: | |||||
Current portion of long-term debt | 32.3 | 37.1 | |||
Accounts payable | 78.4 | 68.3 | |||
Accrued payroll | 172.1 | 147.3 | |||
Accrued interest payable | 24.7 | 25.8 | |||
Other current liabilities | 210 | 197.1 | |||
Total current liabilities | 517.5 | 475.6 | |||
Long-term debt, net of current portion | 2,545.4 | 2,979.3 | |||
Intercompany notes payable | 0 | 0 | |||
Self-insured risks | 110.1 | 110.4 | |||
Other long-term liabilities | 75.2 | 49.6 | |||
Intercompany payable | 0 | 0 | |||
Total liabilities | 3,248.2 | 3,614.9 | |||
Commitments and contingencies | |||||
Redeemable noncontrolling interests | 220.9 | 138.3 | |||
Shareholders' equity | |||||
Encompass Health shareholders’ equity | 1,181.7 | 735.9 | |||
Noncontrolling interests | 242.9 | 192.8 | |||
Total shareholders’ equity | 1,424.6 | 928.7 | 779.3 | 619.5 | |
Total liabilities and shareholders’ equity | 4,893.7 | 4,681.9 | |||
Consolidation, Eliminations [Member] | |||||
Current assets: | |||||
Cash & Cash Equivalents | 0 | 0 | 0 | 0 | |
Restricted cash | 0 | 0 | |||
Accounts receivable, net | 0 | 0 | |||
Prepaid expenses and other current assets | (18.5) | (18.6) | |||
Total current assets | (18.5) | (18.6) | |||
Property and equipment, net | 0 | 0 | |||
Goodwill | 0 | 0 | |||
Intangible assets, net | 0 | 0 | |||
Deferred income tax assets | (42.2) | (72.7) | |||
Other long-term assets | 0 | 0 | |||
Intercompany notes receivable | (486.2) | (528.8) | |||
Intercompany receivable and investments in consolidated affiliates | (3,150.4) | (2,963.2) | |||
Total assets | (3,697.3) | (3,583.3) | |||
Current liabilities: | |||||
Current portion of long-term debt | (17.5) | (17.5) | |||
Accounts payable | 0 | 0 | |||
Accrued payroll | 0 | 0 | |||
Accrued interest payable | 0 | 0 | |||
Other current liabilities | (1) | (1.1) | |||
Total current liabilities | (18.5) | (18.6) | |||
Long-term debt, net of current portion | 0 | 0 | |||
Intercompany notes payable | (486.2) | (528.8) | |||
Self-insured risks | 0 | 0 | |||
Other long-term liabilities | (42.1) | (72.3) | |||
Intercompany payable | (144.8) | (167.6) | |||
Total liabilities | (691.6) | (787.3) | |||
Commitments and contingencies | |||||
Redeemable noncontrolling interests | 0 | 0 | |||
Shareholders' equity | |||||
Encompass Health shareholders’ equity | (3,005.7) | (2,796) | |||
Noncontrolling interests | 0 | 0 | |||
Total shareholders’ equity | (3,005.7) | (2,796) | |||
Total liabilities and shareholders’ equity | (3,697.3) | (3,583.3) | |||
Parent Company [Member] | |||||
Current assets: | |||||
Cash & Cash Equivalents | 34.3 | 20.6 | 41.2 | 41.9 | |
Restricted cash | 0 | 0 | |||
Accounts receivable, net | 0 | 0 | |||
Prepaid expenses and other current assets | 61.4 | 49.9 | |||
Total current assets | 95.7 | 70.5 | |||
Property and equipment, net | 101.8 | 41.6 | |||
Goodwill | 0 | 0 | |||
Intangible assets, net | 11.8 | 12 | |||
Deferred income tax assets | 97.4 | 90.9 | |||
Other long-term assets | 49.2 | 49 | |||
Intercompany notes receivable | 486.2 | 528.8 | |||
Intercompany receivable and investments in consolidated affiliates | 2,839.1 | 2,855.5 | |||
Total assets | 3,681.2 | 3,648.3 | |||
Current liabilities: | |||||
Current portion of long-term debt | 32.8 | 40 | |||
Accounts payable | 10.4 | 7 | |||
Accrued payroll | 36.1 | 31.6 | |||
Accrued interest payable | 21.9 | 22.8 | |||
Other current liabilities | 108.8 | 96.3 | |||
Total current liabilities | 210 | 197.7 | |||
Long-term debt, net of current portion | 2,258.5 | 2,679.2 | |||
Intercompany notes payable | 0 | 0 | |||
Self-insured risks | 9.6 | 14.1 | |||
Other long-term liabilities | 21.4 | 21.4 | |||
Intercompany payable | 0 | 0 | |||
Total liabilities | 2,499.5 | 2,912.4 | |||
Commitments and contingencies | |||||
Redeemable noncontrolling interests | 0 | 0 | |||
Shareholders' equity | |||||
Encompass Health shareholders’ equity | 1,181.7 | 735.9 | |||
Noncontrolling interests | 0 | 0 | |||
Total shareholders’ equity | 1,181.7 | 735.9 | |||
Total liabilities and shareholders’ equity | 3,681.2 | 3,648.3 | |||
Guarantor Subsidiaries [Member] | |||||
Current assets: | |||||
Cash & Cash Equivalents | 2.9 | 1.6 | 1.2 | 1.4 | |
Restricted cash | 0 | 0 | |||
Accounts receivable, net | 285.2 | 273.3 | |||
Prepaid expenses and other current assets | 21.7 | 24 | |||
Total current assets | 309.8 | 298.9 | |||
Property and equipment, net | 991.5 | 979.7 | |||
Goodwill | 854.6 | 858.4 | |||
Intangible assets, net | 105.1 | 115.5 | |||
Deferred income tax assets | 8.4 | 57.6 | |||
Other long-term assets | 100.5 | 95.1 | |||
Intercompany notes receivable | 0 | 0 | |||
Intercompany receivable and investments in consolidated affiliates | 311.3 | 107.7 | |||
Total assets | 2,681.2 | 2,512.9 | |||
Current liabilities: | |||||
Current portion of long-term debt | 7.4 | 6.4 | |||
Accounts payable | 43.5 | 37.2 | |||
Accrued payroll | 63.8 | 57.3 | |||
Accrued interest payable | 2.6 | 2.8 | |||
Other current liabilities | 15.6 | 21.6 | |||
Total current liabilities | 132.9 | 125.3 | |||
Long-term debt, net of current portion | 242.2 | 248.9 | |||
Intercompany notes payable | 0 | 0 | |||
Self-insured risks | 0 | 0 | |||
Other long-term liabilities | 17.8 | 15.2 | |||
Intercompany payable | 0 | 0 | |||
Total liabilities | 392.9 | 389.4 | |||
Commitments and contingencies | |||||
Redeemable noncontrolling interests | 0 | 0 | |||
Shareholders' equity | |||||
Encompass Health shareholders’ equity | 2,288.3 | 2,123.5 | |||
Noncontrolling interests | 0 | 0 | |||
Total shareholders’ equity | 2,288.3 | 2,123.5 | |||
Total liabilities and shareholders’ equity | 2,681.2 | 2,512.9 | |||
Non-Guarantor Subsidiaries [Member] | |||||
Current assets: | |||||
Cash & Cash Equivalents | 17.2 | 18.3 | $ 19.2 | $ 23.4 | |
Restricted cash | 62.4 | 60.9 | |||
Accounts receivable, net | 186.9 | 170.5 | |||
Prepaid expenses and other current assets | 48.7 | 54 | |||
Total current assets | 315.2 | 303.7 | |||
Property and equipment, net | 423.8 | 370.5 | |||
Goodwill | 1,118 | 1,068.8 | |||
Intangible assets, net | 286.2 | 283.8 | |||
Deferred income tax assets | 0 | 0 | |||
Other long-term assets | 85.4 | 77.2 | |||
Intercompany notes receivable | 0 | 0 | |||
Intercompany receivable and investments in consolidated affiliates | 0 | 0 | |||
Total assets | 2,228.6 | 2,104 | |||
Current liabilities: | |||||
Current portion of long-term debt | 9.6 | 8.2 | |||
Accounts payable | 24.5 | 24.1 | |||
Accrued payroll | 72.2 | 58.4 | |||
Accrued interest payable | 0.2 | 0.2 | |||
Other current liabilities | 86.6 | 80.3 | |||
Total current liabilities | 193.1 | 171.2 | |||
Long-term debt, net of current portion | 44.7 | 51.2 | |||
Intercompany notes payable | 486.2 | 528.8 | |||
Self-insured risks | 100.5 | 96.3 | |||
Other long-term liabilities | 78.1 | 85.3 | |||
Intercompany payable | 144.8 | 167.6 | |||
Total liabilities | 1,047.4 | 1,100.4 | |||
Commitments and contingencies | |||||
Redeemable noncontrolling interests | 220.9 | 138.3 | |||
Shareholders' equity | |||||
Encompass Health shareholders’ equity | 717.4 | 672.5 | |||
Noncontrolling interests | 242.9 | 192.8 | |||
Total shareholders’ equity | 960.3 | 865.3 | |||
Total liabilities and shareholders’ equity | $ 2,228.6 | $ 2,104 | |||
[1] | Our consolidated assets as of December 31, 2017 and December 31, 2016 include total assets of variable interest entities of $264.1 million and $262.3 million, respectively, which cannot be used by us to settle the obligations of other entities. Our consolidated liabilities as of December 31, 2017 and December 31, 2016 include total liabilities of the variable interest entities of $52.5 million and $50.3 million, respectively. See Note 3, Variable Interest Entities. |
Condensed Consolidating Fina118
Condensed Consolidating Financial Information - Condensed Consolidating Statements of Cash Flows (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Jan. 17, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Consolidated Statements of Cash Flows [Abstract] | ||||
Net cash provided by operating activities | $ 657.2 | $ 634.4 | $ 502 | |
Cash flows from investing activities: | ||||
Acquisition of businesses, net of cash acquired | (38.8) | (48.1) | (985.1) | |
Purchases of property and equipment | (225.8) | (177.7) | (128.4) | |
Additions to capitalized software costs | (19.2) | (25.2) | (28.1) | |
Proceeds from disposal of assets | 12.3 | 23.9 | 4 | |
Proceeds from sale of nonrestricted marketable securities | 0 | 0 | 12.8 | |
Purchase of restricted investments | (8.5) | (1.3) | (7.1) | |
Net change in restricted cash | (1.5) | (15.1) | 2.7 | |
Funding of intercompany note receivable | 0 | 0 | ||
Proceeds from repayment of intercompany note receivable | 0 | 0 | 0 | |
Other | (3) | (1.6) | (1.1) | |
Net cash provided by investing activities of discontinued operations | 0 | 0.1 | 0.5 | |
Net cash used in investing activities | (284.5) | (245) | (1,129.8) | |
Cash flows from financing activities: | ||||
Principal borrowings on term loan facilities | 0 | 0 | 250 | |
Proceeds from bond issuance | 0 | 0 | 1,400 | |
Principal payments on debt, including pre-payments | (129.9) | (202.1) | (597.4) | |
Principal borrowings on intercompany notes payable | 0 | 0 | ||
Principal payments on intercompany notes payable | 0 | 0 | 0 | |
Borrowings on revolving credit facility | 273.3 | 335 | 540 | |
Payments on revolving credit facility | (330.3) | (313) | (735) | |
Principal payments under capital lease obligations | (15.3) | (13.3) | (11) | |
Debt amendment and issuance costs | (3.1) | 0 | (31.9) | |
Repurchases of common stock, including fees and expenses | (38.1) | (65.6) | (45.3) | |
Dividends paid on common stock | (91.5) | (83.8) | (77.2) | |
Proceeds from exercising stock warrants | $ 26.7 | 26.6 | 0 | 0 |
Distributions paid to noncontrolling interests of consolidated affiliates | (51.9) | (64.9) | (54.4) | |
Taxes paid on behalf of employees for shares withheld | (19.8) | (11.6) | (17.2) | |
Contributions from consolidated affiliates | 20.8 | 3.5 | 3 | |
Other | 0.4 | 5.3 | (0.9) | |
Change in intercompany advances | 0 | 0 | 0 | |
Net cash (used in) provided by financing activities | (358.8) | (410.5) | 622.7 | |
Increase (decrease) in cash and cash equivalents | 13.9 | (21.1) | (5.1) | |
Cash and cash equivalents at beginning of year | 40.5 | 40.5 | 61.6 | 66.7 |
Cash and cash equivalents at end of year | 54.4 | 40.5 | 61.6 | |
Supplemental schedule of noncash financing activities: | ||||
Conversion of convertible debt | 319.4 | 0 | 0 | |
Preferred stock conversion | 0 | 0 | 93.2 | |
Intercompany note activity | 0 | |||
Eliminating Entries | ||||
Consolidated Statements of Cash Flows [Abstract] | ||||
Net cash provided by operating activities | 0 | 0 | 0 | |
Cash flows from investing activities: | ||||
Acquisition of businesses, net of cash acquired | 0 | 0 | 0 | |
Purchases of property and equipment | 0 | 0 | 0 | |
Additions to capitalized software costs | 0 | 0 | 0 | |
Proceeds from disposal of assets | 0 | 0 | 0 | |
Proceeds from sale of nonrestricted marketable securities | 0 | |||
Purchase of restricted investments | 0 | 0 | 0 | |
Net change in restricted cash | 0 | 0 | 0 | |
Funding of intercompany note receivable | 22.5 | 2 | ||
Proceeds from repayment of intercompany note receivable | (51) | (52) | (24) | |
Other | 0 | 0 | 0 | |
Net cash provided by investing activities of discontinued operations | 0 | 0 | ||
Net cash used in investing activities | (51) | (29.5) | (22) | |
Cash flows from financing activities: | ||||
Principal borrowings on term loan facilities | 0 | |||
Proceeds from bond issuance | 0 | |||
Principal payments on debt, including pre-payments | 0 | 0 | 0 | |
Principal borrowings on intercompany notes payable | (22.5) | (2) | ||
Principal payments on intercompany notes payable | 51 | 52 | 24 | |
Borrowings on revolving credit facility | 0 | 0 | 0 | |
Payments on revolving credit facility | 0 | 0 | 0 | |
Principal payments under capital lease obligations | 0 | 0 | 0 | |
Debt amendment and issuance costs | 0 | 0 | ||
Repurchases of common stock, including fees and expenses | 0 | 0 | 0 | |
Dividends paid on common stock | 0 | 0 | 0 | |
Proceeds from exercising stock warrants | 0 | |||
Distributions paid to noncontrolling interests of consolidated affiliates | 0 | 0 | 0 | |
Taxes paid on behalf of employees for shares withheld | 0 | 0 | 0 | |
Contributions from consolidated affiliates | 0 | 0 | 0 | |
Other | 0 | 0 | 0 | |
Change in intercompany advances | 0 | 0 | 0 | |
Net cash (used in) provided by financing activities | 51 | 29.5 | 22 | |
Increase (decrease) in cash and cash equivalents | 0 | 0 | 0 | |
Cash and cash equivalents at beginning of year | 0 | 0 | 0 | 0 |
Cash and cash equivalents at end of year | 0 | 0 | 0 | |
Supplemental schedule of noncash financing activities: | ||||
Conversion of convertible debt | 0 | |||
Preferred stock conversion | 0 | |||
Intercompany note activity | 0 | |||
Encompass Health Corporation | ||||
Consolidated Statements of Cash Flows [Abstract] | ||||
Net cash provided by operating activities | 27.6 | 65.8 | 59.7 | |
Cash flows from investing activities: | ||||
Acquisition of businesses, net of cash acquired | (10.9) | 0 | (954.6) | |
Purchases of property and equipment | (39.4) | (21.8) | (15.9) | |
Additions to capitalized software costs | (16.3) | (22.8) | (24.5) | |
Proceeds from disposal of assets | 0 | 0 | 0 | |
Proceeds from sale of nonrestricted marketable securities | 12.8 | |||
Purchase of restricted investments | 0 | 0 | 0 | |
Net change in restricted cash | 0 | 0 | 0 | |
Funding of intercompany note receivable | (22.5) | (2) | ||
Proceeds from repayment of intercompany note receivable | 51 | 52 | 24 | |
Other | (3.7) | (3.7) | (0.5) | |
Net cash provided by investing activities of discontinued operations | 0.1 | 0.5 | ||
Net cash used in investing activities | (19.3) | (18.7) | (960.2) | |
Cash flows from financing activities: | ||||
Principal borrowings on term loan facilities | 250 | |||
Proceeds from bond issuance | 1,400 | |||
Principal payments on debt, including pre-payments | (126.9) | (198.5) | (595) | |
Principal borrowings on intercompany notes payable | 0 | 0 | ||
Principal payments on intercompany notes payable | 0 | 0 | 0 | |
Borrowings on revolving credit facility | 273.3 | 335 | 540 | |
Payments on revolving credit facility | (330.3) | (313) | (735) | |
Principal payments under capital lease obligations | 0 | (0.1) | (0.3) | |
Debt amendment and issuance costs | (3.1) | (31.9) | ||
Repurchases of common stock, including fees and expenses | (38.1) | (65.6) | (45.3) | |
Dividends paid on common stock | (91.5) | (83.8) | (77.2) | |
Proceeds from exercising stock warrants | 26.6 | |||
Distributions paid to noncontrolling interests of consolidated affiliates | 0 | 0 | 0 | |
Taxes paid on behalf of employees for shares withheld | (19.5) | (11.6) | (17.2) | |
Contributions from consolidated affiliates | 0 | 0 | 0 | |
Other | 1.1 | 6.9 | (0.9) | |
Change in intercompany advances | 313.8 | 263 | 212.6 | |
Net cash (used in) provided by financing activities | 5.4 | (67.7) | 899.8 | |
Increase (decrease) in cash and cash equivalents | 13.7 | (20.6) | (0.7) | |
Cash and cash equivalents at beginning of year | 20.6 | 20.6 | 41.2 | 41.9 |
Cash and cash equivalents at end of year | 34.3 | 20.6 | 41.2 | |
Supplemental schedule of noncash financing activities: | ||||
Conversion of convertible debt | 319.4 | |||
Preferred stock conversion | 93.2 | |||
Intercompany note activity | (183.5) | |||
Guarantor Subsidiaries | ||||
Consolidated Statements of Cash Flows [Abstract] | ||||
Net cash provided by operating activities | 381.3 | 327.4 | 214.6 | |
Cash flows from investing activities: | ||||
Acquisition of businesses, net of cash acquired | 0 | 0 | 0 | |
Purchases of property and equipment | (106.1) | (77.4) | (62) | |
Additions to capitalized software costs | (0.2) | (0.2) | (0.4) | |
Proceeds from disposal of assets | 11.7 | 0.7 | 3.5 | |
Proceeds from sale of nonrestricted marketable securities | 0 | |||
Purchase of restricted investments | 0 | 0 | 0 | |
Net change in restricted cash | 0 | 0 | 0 | |
Funding of intercompany note receivable | 0 | 0 | ||
Proceeds from repayment of intercompany note receivable | 0 | 0 | 0 | |
Other | 0 | (0.2) | (1.9) | |
Net cash provided by investing activities of discontinued operations | 0 | 0 | ||
Net cash used in investing activities | (94.6) | (77.1) | (60.8) | |
Cash flows from financing activities: | ||||
Principal borrowings on term loan facilities | 0 | |||
Proceeds from bond issuance | 0 | |||
Principal payments on debt, including pre-payments | 0 | (1.3) | (1.6) | |
Principal borrowings on intercompany notes payable | 0 | 0 | ||
Principal payments on intercompany notes payable | 0 | 0 | 0 | |
Borrowings on revolving credit facility | 0 | 0 | 0 | |
Payments on revolving credit facility | 0 | 0 | 0 | |
Principal payments under capital lease obligations | (6.8) | (5.9) | (4.5) | |
Debt amendment and issuance costs | 0 | 0 | ||
Repurchases of common stock, including fees and expenses | 0 | 0 | 0 | |
Dividends paid on common stock | 0 | 0 | 0 | |
Proceeds from exercising stock warrants | 0 | |||
Distributions paid to noncontrolling interests of consolidated affiliates | 0 | 0 | 0 | |
Taxes paid on behalf of employees for shares withheld | 0 | 0 | 0 | |
Contributions from consolidated affiliates | 0 | 0 | 0 | |
Other | 0 | 0 | 1.5 | |
Change in intercompany advances | (278.6) | (242.7) | (149.4) | |
Net cash (used in) provided by financing activities | (285.4) | (249.9) | (154) | |
Increase (decrease) in cash and cash equivalents | 1.3 | 0.4 | (0.2) | |
Cash and cash equivalents at beginning of year | 1.6 | 1.6 | 1.2 | 1.4 |
Cash and cash equivalents at end of year | 2.9 | 1.6 | 1.2 | |
Supplemental schedule of noncash financing activities: | ||||
Conversion of convertible debt | 0 | |||
Preferred stock conversion | 0 | |||
Intercompany note activity | 0 | |||
Non-Guarantor Subsidiaries | ||||
Consolidated Statements of Cash Flows [Abstract] | ||||
Net cash provided by operating activities | 248.3 | 241.2 | 227.7 | |
Cash flows from investing activities: | ||||
Acquisition of businesses, net of cash acquired | (27.9) | (48.1) | (30.5) | |
Purchases of property and equipment | (80.3) | (78.5) | (50.5) | |
Additions to capitalized software costs | (2.7) | (2.2) | (3.2) | |
Proceeds from disposal of assets | 0.6 | 23.2 | 0.5 | |
Proceeds from sale of nonrestricted marketable securities | 0 | |||
Purchase of restricted investments | (8.5) | (1.3) | (7.1) | |
Net change in restricted cash | (1.5) | (15.1) | 2.7 | |
Funding of intercompany note receivable | 0 | 0 | ||
Proceeds from repayment of intercompany note receivable | 0 | 0 | 0 | |
Other | 0.7 | 2.3 | 1.3 | |
Net cash provided by investing activities of discontinued operations | 0 | 0 | ||
Net cash used in investing activities | (119.6) | (119.7) | (86.8) | |
Cash flows from financing activities: | ||||
Principal borrowings on term loan facilities | 0 | |||
Proceeds from bond issuance | 0 | |||
Principal payments on debt, including pre-payments | (3) | (2.3) | (0.8) | |
Principal borrowings on intercompany notes payable | 22.5 | 2 | ||
Principal payments on intercompany notes payable | (51) | (52) | (24) | |
Borrowings on revolving credit facility | 0 | 0 | 0 | |
Payments on revolving credit facility | 0 | 0 | 0 | |
Principal payments under capital lease obligations | (8.5) | (7.3) | (6.2) | |
Debt amendment and issuance costs | 0 | 0 | ||
Repurchases of common stock, including fees and expenses | 0 | 0 | 0 | |
Dividends paid on common stock | 0 | 0 | 0 | |
Proceeds from exercising stock warrants | 0 | |||
Distributions paid to noncontrolling interests of consolidated affiliates | (51.9) | (64.9) | (54.4) | |
Taxes paid on behalf of employees for shares withheld | (0.3) | 0 | 0 | |
Contributions from consolidated affiliates | 20.8 | 3.5 | 3 | |
Other | (0.7) | (1.6) | (1.5) | |
Change in intercompany advances | (35.2) | (20.3) | (63.2) | |
Net cash (used in) provided by financing activities | (129.8) | (122.4) | (145.1) | |
Increase (decrease) in cash and cash equivalents | (1.1) | (0.9) | (4.2) | |
Cash and cash equivalents at beginning of year | $ 18.3 | 18.3 | 19.2 | 23.4 |
Cash and cash equivalents at end of year | 17.2 | $ 18.3 | 19.2 | |
Supplemental schedule of noncash financing activities: | ||||
Conversion of convertible debt | $ 0 | |||
Preferred stock conversion | 0 | |||
Intercompany note activity | $ 183.5 |