Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 29, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Diversicare Healthcare Services, Inc. | |
Entity Central Index Key | 0000919956 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 6,682,260 |
INTERIM CONSOLIDATED BALANCE SH
INTERIM CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 2,465 | $ 2,685 |
Receivables | 63,864 | 66,257 |
Self-insurance receivables | 1,775 | 4,475 |
Other receivables | 1,169 | 1,191 |
Prepaid expenses and other current assets | 4,489 | 4,728 |
Income tax refundable | 553 | 1,115 |
Current assets of discontinued operations | 0 | 86 |
Total current assets | 74,315 | 80,537 |
PROPERTY AND EQUIPMENT, at cost | 139,954 | 138,460 |
Less accumulated depreciation and amortization | (87,666) | (85,361) |
Property and equipment, net | 52,288 | 53,099 |
OTHER ASSETS: | ||
Deferred income taxes, net | 17,022 | 15,851 |
Deferred leasehold costs | 0 | 206 |
Operating lease assets | 377,799 | |
Acquired leasehold interest, net | 6,136 | 6,307 |
Other noncurrent assets | 3,309 | 3,244 |
Total other assets | 404,266 | 25,608 |
Total assets | 530,869 | 159,244 |
CURRENT LIABILITIES: | ||
Current portion of long-term debt and finance lease obligations, net | 10,390 | 12,449 |
Trade accounts payable | 15,137 | 15,659 |
Current liabilities of discontinued operations | 0 | 86 |
Current portion of operating lease liabilities | 22,205 | |
Accrued expenses: | ||
Payroll and employee benefits | 17,643 | 19,471 |
Self-insurance reserves, current portion | 10,881 | 13,158 |
Provider taxes | 2,381 | 2,394 |
Other current liabilities | 6,697 | 7,128 |
Total current liabilities | 85,334 | 70,345 |
NONCURRENT LIABILITIES: | ||
Long-term debt and finance lease obligations, less current portion and deferred financing costs, net | 64,069 | 60,984 |
Operating lease liabilities, less current portion | 362,094 | |
Self-insurance reserves, noncurrent portion | 15,875 | 16,057 |
Litigation contingency | 6,400 | 6,400 |
Other noncurrent liabilities | 1,522 | 6,656 |
Total noncurrent liabilities | 449,960 | 90,097 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS’ DEFICIT: | ||
Common stock, authorized 20,000 shares, $.01 par value, 6,914 and 6,751 shares issued, and 6,682 and 6,519 shares outstanding, respectively | 69 | 68 |
Treasury stock at cost, 232 shares of common stock | (2,500) | (2,500) |
Paid-in capital | 23,594 | 23,413 |
Accumulated deficit | (26,362) | (23,016) |
Accumulated other comprehensive income | 774 | 837 |
Total shareholders’ deficit | (4,425) | (1,198) |
Total liabilities and shareholder's equity | $ 530,869 | $ 159,244 |
INTERIM CONSOLIDATED BALANCE _2
INTERIM CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock, shares authorized (shares) | 20,000,000 | 20,000,000 |
Common stock, par value (dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares issued (shares) | 6,914,000 | 6,751,000 |
Common stock, shares outstanding (shares) | 6,682,000 | 6,519,000 |
Treasury stock, shares (shares) | 232,000 | 232,000 |
INTERIM CONSOLIDATED STATEMENTS
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Income Statement [Abstract] | ||
PATIENT REVENUES, net | $ 134,353 | $ 141,285 |
EXPENSES: | ||
Operating | 108,113 | 112,278 |
Lease and rent expense | 15,804 | 13,713 |
Professional liability | 3,421 | 2,775 |
General and administrative | 7,513 | 8,139 |
Depreciation and amortization | 2,494 | 2,881 |
Total expenses | 137,345 | 139,786 |
OPERATING INCOME (LOSS) | (2,992) | 1,499 |
OTHER INCOME (EXPENSE): | ||
Other income | 160 | 51 |
Interest expense, net | (1,460) | (1,669) |
Total other expense | (1,300) | (1,618) |
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | (4,292) | (119) |
BENEFIT FOR INCOME TAXES | 955 | 38 |
LOSS FROM CONTINUING OPERATIONS | (3,337) | (81) |
LOSS FROM DISCONTINUED OPERATIONS: | ||
Operating loss, net of tax expense of $0 and $11, respectively | (9) | (22) |
NET LOSS | $ (3,346) | $ (103) |
Per common share – basic | ||
Continuing operations (in dollars per share) | $ (0.52) | $ (0.01) |
Discontinued operations (in dollars per share) | 0 | 0 |
Net income (loss) per common share – basic (dollars per share) | (0.52) | (0.01) |
Per common share – diluted | ||
Continuing operations (in dollars per share) | (0.52) | (0.01) |
Discontinued operations (in dollars per share) | 0 | 0 |
Net income (loss) per common share – diluted (dollars per share) | (0.52) | (0.01) |
COMMON STOCK DIVIDENDS DECLARED PER SHARE OF COMMON STOCK (dollars per share) | $ 0 | $ 0.055 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||
Basic (shares) | 6,424 | 6,314 |
Diluted (shares) | 6,424 | 6,314 |
INTERIM CONSOLIDATED STATEMEN_2
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Income Statement [Abstract] | ||
Tax expense (benefit), effect on operating loss | $ 0 | $ 11 |
INTERIM CONSOLIDATED STATEMEN_3
INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
NET LOSS | $ (3,346) | $ (103) |
OTHER COMPREHENSIVE INCOME: | ||
Change in fair value of cash flow hedge, net of tax | (63) | |
Change in fair value of cash flow hedge, net of tax | 322 | |
Less: reclassification adjustment for amounts recognized in net loss | 0 | |
Less: reclassification adjustment for amounts recognized in net loss | (114) | |
Total other comprehensive income (loss) | (63) | 208 |
COMPREHENSIVE INCOME (LOSS) | $ (3,409) | $ 105 |
INTERIM CONSOLIDATED STATEMEN_4
INTERIM CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Treasury Stock | Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) |
Balance (in shares) at Dec. 31, 2017 | 6,687 | 232 | ||||
Balance at Dec. 31, 2017 | $ 6,462 | $ 67 | $ (2,500) | $ 22,720 | $ (14,534) | $ 709 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (103) | (103) | ||||
Common stock dividends declared | (350) | 13 | (363) | |||
Issuance/redemption of equity grants, net (in shares) | 86 | |||||
Issuance/redemption of equity grants, net | (78) | $ 1 | (79) | |||
Interest rate cash flow hedge | 208 | 208 | ||||
Stock-based compensation | 236 | 236 | ||||
Balance (in shares) at Mar. 31, 2018 | 6,773 | 232 | ||||
Balance at Mar. 31, 2018 | 6,375 | $ 68 | $ (2,500) | 22,890 | (15,000) | 917 |
Balance (in shares) at Dec. 31, 2018 | 6,751 | 232 | ||||
Balance at Dec. 31, 2018 | (1,198) | $ 68 | $ (2,500) | 23,413 | (23,016) | 837 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (3,346) | (3,346) | ||||
Issuance/redemption of equity grants, net (in shares) | 163 | |||||
Issuance/redemption of equity grants, net | 42 | $ 1 | 41 | |||
Interest rate cash flow hedge | (63) | (63) | ||||
Stock-based compensation | 140 | 140 | ||||
Balance (in shares) at Mar. 31, 2019 | 6,914 | 232 | ||||
Balance at Mar. 31, 2019 | $ (4,425) | $ 69 | $ (2,500) | $ 23,594 | $ (26,362) | $ 774 |
INTERIM CONSOLIDATED STATEMEN_5
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
NET LOSS | $ (3,346) | $ (103) |
Discontinued operations | (9) | (22) |
Loss from continuing operations | (3,337) | (81) |
Adjustments to reconcile loss from continuing operations to net cash provided by operating activities: | ||
Depreciation and amortization | 2,494 | 2,881 |
Deferred income tax provision (benefit) | (1,090) | 0 |
Provision for self-insured professional liability, net of cash payments | 1,444 | 956 |
Stock-based and deferred compensation | 156 | 284 |
Provision (benefit) for leases in excess of cash payments | 1,280 | (453) |
Other | 335 | 140 |
Changes in assets and liabilities affecting operating activities: | ||
Receivables, net | 5,315 | 2,017 |
Prepaid expenses and other assets | (2,966) | (439) |
Trade accounts payable and accrued expenses | (3,269) | (86) |
Net cash provided by continuing operations | 362 | 5,219 |
Discontinued operations | (9) | (474) |
Net cash provided by operating activities | 353 | 4,745 |
NET CASH FLOWS USED IN INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (1,512) | (2,012) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repayment of debt and finance lease obligations | (1,112) | (4,762) |
Proceeds from issuance of debt | 2,049 | 5,651 |
Financing costs | (40) | (132) |
Issuance and redemption of employee equity awards | 42 | (78) |
Payment of common stock dividends | 0 | (350) |
Payment for preferred stock restructuring | 0 | (168) |
Net cash provided by continuing operations | 939 | 161 |
Discontinued operations | 0 | 0 |
Net cash provided by financing activities | 939 | 161 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (220) | 2,894 |
CASH AND CASH EQUIVALENTS, beginning of period | 2,685 | 3,524 |
CASH AND CASH EQUIVALENTS, end of period | 2,465 | 6,418 |
SUPPLEMENTAL INFORMATION: | ||
Cash payments of interest | 1,289 | 1,432 |
Cash receipts of income taxes | (426) | (16) |
SUPPLEMENTAL INFORMATION ON NON-CASH INVESTING AND FINANCING TRANSACTIONS: | ||
Acquisition of equipment through finance leases | 49 | $ 0 |
Acquisition of operating leases through adoption of ASC 842 | $ 389,403 |
BUSINESS
BUSINESS | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BUSINESS | BUSINESS Diversicare Healthcare Services, Inc. (together with its subsidiaries, “Diversicare” or the “Company”) provides long-term care services to nursing center patients in ten states, primarily in the Southeast, Midwest, and Southwest. The Company’s centers provide a range of health care services to their patients and residents that include nursing, personal care, and social services. Additionally, the Company’s nursing centers also offer a variety of comprehensive rehabilitation services, as well as nutritional support services. The Company's continuing operations include centers in Alabama, Florida, Indiana, Kansas, Kentucky, Mississippi, Missouri, Ohio, Tennessee, and Texas. As of March 31, 2019 , the Company’s continuing operations consist of 72 nursing centers with 8,214 licensed nursing beds. The Company owns 15 and leases 57 of its nursing centers. Our nursing centers range in size from 48 to 320 licensed nursing beds. The licensed nursing bed count does not include 429 licensed assisted and residential living beds. |
CONSOLIDATION AND BASIS OF PRES
CONSOLIDATION AND BASIS OF PRESENTATION OF FINANCIAL STATEMENTS | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
CONSOLIDATION AND BASIS OF PRESENTATION OF FINANCIAL STATEMENTS | CONSOLIDATION AND BASIS OF PRESENTATION OF FINANCIAL STATEMENTS The interim consolidated financial statements for the three month periods ended March 31, 2019 and 2018 , included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") have been condensed or omitted pursuant to such rules and regulations. In the opinion of management of the Company, the accompanying interim consolidated financial statements reflect all normal, recurring adjustments necessary to present fairly the Company’s financial position at March 31, 2019 , and the results of operations for the three month periods ended March 31, 2019 and 2018 , changes in shareholders' equity (deficit) for the three month periods ended March 31, 2019 and 2018 , and cash flows for the three month periods ended March 31, 2019 and 2018 . The Company’s balance sheet information at December 31, 2018 , was derived from its audited consolidated financial statements as of December 31, 2018 . Effective January 1, 2019, we adopted the requirements of Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842), as discussed in Notes 3 and 6 to the interim consolidated financial statements. Effective January 1, 2018, we adopted the requirements of ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), as discussed in Notes 3 and 4 to the interim consolidated financial statements. All amounts and disclosures set forth in this Form 10-Q have been updated to comply with the new standards. The results of operations for the periods ended March 31, 2019 and 2018 are not necessarily indicative of the operating results that may be expected for a full year. These interim consolidated financial statements should be read in connection with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 . |
RECENT ACCOUNTING GUIDANCE
RECENT ACCOUNTING GUIDANCE | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
RECENT ACCOUNTING GUIDANCE | RECENT ACCOUNTING GUIDANCE Recent Accounting Standards Adopted by the Company In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The standard establishes a right-of-use ("ROU") model that requires a lessee to record a ROU asset and a lease liability on the balance sheet. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. For short-term leases (those with a term of 12 months or less and that do not include a lessee purchase option that is reasonably certain to be exercised), a lessee is permitted to make (and the Company chose to utilize) an accounting policy election by asset class not to recognize ROU assets and lease liabilities, which would generally result in lease expense for these short term leases being recognized on a straight-line basis over the lease term. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company adopted the requirements of this standard effective January 1, 2019. In July 2018, the FASB issued ASU 2018-11, Leases - Targeted Improvements, which allows lessees and lessors to recognize and measure existing leases at the beginning of the period of adoption without modifying the comparative period financial statements (which therefore will remain under prior GAAP, Topic 840, Leases). The Company elected to use the optional expedient to reflect adoption in the period of adoption (January 1, 2019) rather than the earliest period presented. The Company also elected the package of practical expedients upon transition, which includes retaining the lease classification for any leases that exist prior to adoption of the standard. The adoption of the new standard resulted in the recording of net lease assets and lease liabilities of $384,187 and $389,403 , respectively, as of January 1, 2019. The standard did not materially impact our consolidated net earnings and had no impact on cash flows. See Note 6, "Leases" for a discussion regarding leases under the new standard. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities, which is intended to simplify and amend the application of hedge accounting to more clearly portray the economics of an entity’s risk management strategies in its financial statements. The new guidance will make more financial and nonfinancial hedging strategies eligible for hedge accounting and reduce complexity in fair value hedges of interest rate risk. The new guidance also changes how companies assess effectiveness and amends the presentation and disclosure requirements. The new guidance eliminates the requirement to separately measure and report hedge ineffectiveness and generally the entire change in the fair value of a hedging instrument will be required to be presented in the same income statement line as the hedged item. The new guidance also eases certain documentation and assessment requirements and modifies the accounting for components excluded from the assessment of hedge effectiveness. The new guidance is effective for public entities for fiscal years beginning after December 15, 2018, including interim periods within those years. The Company adopted the requirements of this standard effective January 1, 2019. The adoption did not have a material impact on our consolidated financial statements and related disclosures. In February 2018, the FASB issued ASU No. 2018-02, Income Statement- Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The new guidance allows entities the option to reclassify stranded tax effects resulting from the Tax Cuts and Jobs Act from accumulated other comprehensive income (OCI) to retained earnings. The new guidance allows the option to apply the guidance retrospectively or in the period of adoption. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. The Company adopted the requirements of this standard effective January 1, 2019. The adoption did not have a material impact on our consolidated financial statements and related disclosures. In June 2018, the FASB issued ASU No. 2018-07, Compensation-Stock Compensation (Topic 718): Improvement to Nonemployee Share-Based Payment Accounting, which modifies the accounting for share-based payment awards issued to nonemployees to largely align it with the accounting for share-based payment awards issued to employees. The standard is effective for fiscal years beginning after December 15, 2018. The Company adopted the requirements of this standard effective January 1, 2019. The adoption did not have a material impact on our consolidated financial statements and related disclosures. In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which outlines a single comprehensive model for recognizing revenue and supersedes most existing revenue recognition guidance, including guidance specific to the healthcare industry. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2017. The Company adopted the requirements of this standard effective January 1, 2018. The Company elected to apply the modified retrospective approach with the cumulative transition effect recognized in beginning retained earnings as of the date of adoption. The adoption of ASC 606 represents a change in accounting principle that more closely aligns revenue recognition with the delivery of the Company's services. The cumulative effect of applying the new guidance to all contracts with customers as of January 1, 2018 was not material to the interim consolidated financial statements. See Note 4, "Revenue Recognition" for a discussion regarding revenue recognition under the new standard. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230). The ASU provides clarification regarding how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The new guidance addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The ASU is effective for annual and interim periods beginning after December 15, 2017, which required the Company to adopt these provisions in the first quarter of fiscal 2018 using a retrospective approach. The adoption did not have a material impact on our financial position, results of operations or cash flows. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires that the Statement of Cash Flows explain the changes during the period of cash and cash equivalents inclusive of amounts categorized as Restricted Cash. As a result, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The standard is effective for periods beginning after December 15, 2017, which required the Company to adopt these provisions in the first quarter of fiscal 2018. The adoption did not have a material impact on our financial position, results of operations or cash flows. In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805) - Clarifying the Definition of a Business, which provides guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The adoption is effective for annual and interim periods beginning after December 15, 2017. The Company will evaluate future acquisitions under this guidance, which may result in future acquisitions being accounted for as asset acquisitions. In May 2017, the FASB issued ASU No. 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. The amended standard specifies the modification accounting applicable to any entity which changes the terms or conditions of a share-based payment award. The new guidance is effective for all entities after December 15, 2017. The adoption did not have a material impact on our financial position, results of operations or cash flows. Accounting Standards Recently Issued But Not Yet Adopted by the Company In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The new guidance intends to improve financial reporting by requiring timelier recognition of credit losses on loans and other financial instruments that are not accounted for at fair value through net income, including loans held for investment, held-to-maturity debt securities, trade and other receivables, net investment in leases and other such commitments. This update requires that financial statement assets measured at an amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. This standard is effective for the fiscal year beginning after December 15, 2019 with early adoption permitted. The Company is in the initial stages of evaluating the impact from the adoption of this new standard on the consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurements (Topic 820): Disclosure Framework- Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in this update modify the disclosure requirements of fair value measurements under Topic 820. The standard is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company is evaluating the effect this guidance will have on our consolidated financial statements and related disclosures. In October 2018, the FASB issued ASU No. 2018-16, Derivatives and Hedging (Topic 805): Inclusion of the Secured Overnight Financing Rate ("SOFR") Overnight Index Swap ("OIS") Rate as a Benchmark Interest Rate for Hedge Accounting Purposes. The ASU amends ASC 815 to add the OIS rate based on the SOFR as a fifth US benchmark interest rate. The Company is evaluating the effect this guidance will have on our consolidated financial statements and related disclosures. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | REVENUE RECOGNITION On January 1, 2018, the Company adopted Accounting Standards Codification ("ASC") 606 using the modified retrospective method for all contracts as of the date of adoption. The adoption of ASC 606 represents a change in accounting principle that more closely aligns revenue recognition with the delivery of the Company's services. The cumulative effect of applying the new guidance to all contracts with customers as of January 1, 2018 was not material to the interim consolidated financial statements. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. ASC 606 requires companies to exercise more judgment and recognize revenue in accordance with the standard's core principle by applying the following five steps: Step 1: Identify the contract with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. Performance obligations are promises made in a contract to transfer a distinct good or service to the customer. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The Company has concluded that the contracts with patients and residents represent a bundle of distinct services that are substantially the same, with the same pattern of transfer to the customer. Accordingly, the promise to provide quality care is accounted for as a single performance obligation. The Company performed analyses using the application of the portfolio approach as a practical expedient to group patient contracts with similar characteristics, such that revenue for a given portfolio would not be materially different than if it were evaluated on a contract-by-contract basis. These analyses incorporated consideration of reimbursements at varying rates from Medicaid, Medicare, Managed Care, Private Pay, Assisted Living, Hospice, and Veterans for services provided in each corresponding state. It was determined that the contracts are not materially different for the following groups: Medicaid, Medicare, Managed Care and Private Pay and other (Assisted Living, Hospice and Veterans). In order to determine the transaction price, the Company estimates the amount of variable consideration at the beginning of the contract using the expected value method. The estimates consider (i) payor type, (ii) historical payment trends, (iii) the maturity of the portfolio, and (iv) geographic payment trends throughout a class of similar payors. The Company typically enters into agreements with third-party payors that provide for payments at amounts different from the established charges. These arrangement terms provide for subsequent settlement and cash flows that may occur well after the service is provided. The Company constrains (reduces) the estimates of variable consideration such that it is probable that a significant reversal of previously recognized revenue will not occur throughout the life of the contract. Changes in the Company's expectation of the amount it will receive from the patient or third-party payors will be recorded in revenue unless there is a specific event that suggests the patient or third-party payor no longer has the ability and intent to pay the amount due and, therefore, the changes in its estimate of variable consideration better represent an impairment, or bad debt. These estimates are re-assessed each reporting period, and any amounts allocated to a satisfied performance obligation are recognized as revenue or a reduction of revenue in the period in which the transaction price changes. The Company satisfies its performance obligation by providing quality of care services to its patients and residents on a daily basis until termination of the contract. The performance obligation is recognized on a time elapsed basis, by day, for which the services are provided. For these contracts, the Company has the right to consideration from the customer in an amount that directly corresponds with the value to the customer of the Company's performance to date. Therefore, the Company recognizes revenue based on the amount billable to the customer in accordance with the practical expedient in ASC 606-10-55-18. Additionally, because the Company applied ASC 606 using certain practical expedients, the Company elected not to disclose the aggregate amount of the transaction price for unsatisfied, or partially unsatisfied, performance obligations for all contracts with an original expected length of one year or less. The Company incurs costs related to patient/resident contracts, such as legal and advertising expenses. The contract costs are expensed as incurred. They are not expected to be recovered and are not chargeable to the patient/resident regardless of whether the contract is executed. Disaggregation of Revenue and Accounts Receivable The following table summarizes revenue from contracts with customers by payor source for the periods presented (dollar amounts in thousands): Three Months Ended March 31, 2019 2018 Medicaid $ 63,531 47.3 % $ 63,886 45.2 % Medicare 25,055 18.6 % 29,751 21.1 % Managed Care 14,175 10.6 % 14,212 10.1 % Private Pay and other 31,592 23.5 % 33,436 23.6 % Total $ 134,353 100.0 % $ 141,285 100.0 % Accounts receivable as of March 31, 2019 and December 31, 2018 are summarized in the following table: March 31, December 31, 2019 2018 Medicaid $ 25,971 $ 27,532 Medicare 13,249 15,706 Managed Care 9,083 8,126 Private Pay and other 15,561 14,893 Total accounts receivable $ 63,864 $ 66,257 |
LONG-TERM DEBT AND INTEREST RAT
LONG-TERM DEBT AND INTEREST RATE SWAP | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT AND INTEREST RATE SWAP | LONG-TERM DEBT AND INTEREST RATE SWAP The Company has agreements with a syndicate of banks for a mortgage term loan ("Original Mortgage Loan") and the Company’s revolving credit agreement ("Original Revolver"). On February 26, 2016, the Company executed an Amended and Restated Credit Agreement (the "Credit Agreement") which modified the terms of the Original Mortgage Loan and the Original Revolver Agreements dated April 30, 2013. The Credit Agreement increased the Company's borrowing capacity to $100,000 allocated between a $72,500 Mortgage Loan ("Amended Mortgage Loan") and a $27,500 Revolver ("Amended Revolver"). The Amended Mortgage Loan consists of a $60,000 term loan facility and a $12,500 acquisition loan facility. Loan acquisition costs associated with the Amended Mortgage Loan and the Amended Revolver were capitalized in the amount of $2,162 and are being amortized over the five -year term of the agreements. Under the terms of the amended agreements, the syndicate of banks provided the Amended Mortgage Loan with an original principal balance of $72,500 with a five -year maturity through February 26, 2021, and a $27,500 Amended Revolver through February 26, 2021. The Amended Mortgage Loan has a term of five years, with principal and interest payable monthly based on a 25 -year amortization. Interest on the term and acquisition loan facilities is based on LIBOR plus 4.0% and 4.75% , respectively. A portion of the Amended Mortgage Loan is effectively fixed at 5.79% pursuant to an interest rate swap with an initial notional amount of $30,000 . The Amended Mortgage Loan balance was $58,150 as of March 31, 2019 , consisting of $51,250 on the term loan facility with an interest rate of 6.50% and $6,900 on the acquisition loan facility with an interest rate of 7.25% . The Amended Mortgage Loan is secured by fifteen owned nursing centers, related equipment and a lien on the accounts receivable of these centers. The Amended Mortgage Loan and the Amended Revolver are cross-collateralized and cross-defaulted. The Company’s Amended Revolver has an interest rate of LIBOR plus 4.0% and is secured by accounts receivable and is subject to limits on the maximum amount of loans that can be outstanding under the revolver based on borrowing base restrictions. Effective October 3, 2016, the Company entered into the Second Amendment ("Second Revolver Amendment") to amend the Amended Revolver. The Second Revolver Amendment increased the Amended Revolver capacity from the $27,500 in the Amended Revolver to $52,250 ; provided that the maximum revolving facility be reduced to $42,250 on August 1, 2017. Subsequently, on June 30, 2017, the Company executed a Fourth Amendment (the "Fourth Revolver Amendment") to amend the Amended Revolver, which modifies the capacity of the revolver to remain at $42,250 . On December 29, 2016, the Company executed a Third Amendment ("Third Revolver Amendment") to amend the Amended Revolver. The Third Amendment modified the terms of the Amended Revolving Agreement by increasing the Company’s letter of credit sublimit from $10,000 to $15,000 . Effective June 30, 2017, the Company entered into a Second Amendment ("Second Term Amendment") to amend the Amended Mortgage Loan. The Second Term Amendment amended the terms of the Amended Mortgage Loan Agreement by increasing the Company's term loan facility by $7,500 . Effective February 27, 2018, the Company executed a Fifth Amendment to the Amended Revolver and a Third Amendment to the Amended Mortgage Loan. Under the terms of the Amendments, the minimum fixed charge coverage ratio shall not be less than 1.01 to 1.00 as of March 31, 2018 and for each quarter thereafter. Effective December 1, 2018, the Company entered into the Sixth Amendment ("Sixth Revolver Amendment") to amend the Amended Revolver. The Sixth Amendment decreased the Amended Revolver capacity from $52,250 to $42,250 . The Company also applied $4,947 of net proceeds from the sale of the Kentucky centers to the outstanding borrowings under the Amended Revolver. Effective December 1, 2018, the Company executed a Fourth Amendment (the "Fourth Term Amendment") to amend the Amended Mortgage Loan. The Company applied $11,100 and $2,100 of net proceeds from the sale of the Kentucky centers to the Term Loan and Acquisition Loan, respectively. Additionally, we amended the Acquisition Loan availability to include a reserve of $2,100 , and therefore, our borrowing capacity is $10,400 . For further discussion of the sale of the Kentucky centers, refer to Note 10, "Business Development and Other Significant Transactions." As of March 31, 2019 , the Company had $16,500 borrowings outstanding under the Amended Revolver compared to $15,000 outstanding as of December 31, 2018 . The interest rate related to the Amended Revolver was 6.50% as of March 31, 2019 . The outstanding borrowings on the revolver were used primarily for temporary working capital requirements. Annual fees for letters of credit issued under the Amended Revolver are 3.0% of the amount outstanding. The Company has four letters of credit with a total value of $13,594 outstanding as of March 31, 2019 . Considering the balance of eligible accounts receivable, the letters of credit, the amounts outstanding under the revolving credit facility and the maximum loan amount of $36,679 the balance available for borrowing under the Amended Revolver was $6,585 at March 31, 2019 . The Company’s debt agreements contain various financial covenants, the most restrictive of which relates to debt service coverage ratios. The Company is in compliance with all such covenants at March 31, 2019 . Interest Rate Swap Transaction As part of the debt agreements entered into in April 2013, the Company entered into an interest rate swap agreement with a member of the bank syndicate as the counterparty. The Company designated its interest rate swap as a cash flow hedge and the earnings component of the hedge, net of taxes, is reflected as a component of other comprehensive income (loss). In conjunction with the February 26, 2016 amendment to the Credit Agreement, the Company amended the terms of its interest rate swap. The interest rate swap agreement has the same effective date and maturity date as the Amended Mortgage Loan, and has an amortizing notional amount that was $27,450 as of March 31, 2019 . The interest rate swap agreement requires the Company to make fixed rate payments to the bank calculated on the applicable notional amount at an annual fixed rate of 5.79% while the bank is obligated to make payments to the Company based on LIBOR on the same notional amount. The Company assesses the effectiveness of its interest rate swap on a quarterly basis, and at March 31, 2019 , the Company determined that the interest rate swap was highly effective. The interest rate swap valuation model indicated a net asset of $230 at March 31, 2019 . The fair value of the interest rate swap is included in “other noncurrent assets” on the Company’s interim consolidated balance sheet. The asset related to the change in the interest rate swap included in accumulated other comprehensive income at March 31, 2019 is $161 net of the income tax provision of $69 . As the Company’s interest rate swap is not traded on a market exchange, the fair value is determined using a valuation based on a discounted cash flow analysis. This analysis reflects the contractual terms of the interest rate swap agreement and uses observable market-based inputs, including estimated future LIBOR interest rates. The interest rate swap valuation is classified in Level 2 of the fair value hierarchy, in accordance with the FASB guidance set forth in ASC 820, Fair Value Measurement . |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
LEASES | LEASES The Company has operating and finance leases for facilities, corporate offices, and certain equipment. The Company recognizes lease expense for these operating leases on a straight-line basis over the lease term. Leases with an initial term of one year or less are not recorded on the balance sheet. The Company's other leases have remaining lease terms of one to twelve years, some of which include options to extend the lease for up to twenty years, and some of which include options to terminate the leases within one year. The exercise of lease renewal options is at our sole discretion. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants. Upon adoption, the Company elected the practical expedient to not separate lease and non-lease components for all of its leases as the non-lease components are not significant to the overall lease costs. Leases Classification March 31, 2019 Assets Operating lease assets Operating lease assets 377,799 Finance lease assets Property and equipment, net (a) 1,045 Total leased assets 378,844 Liabilities Current Operating Current portion of operating lease liabilities 22,205 Finance Current portion of long-term debt and finance lease obligations, net 383 Noncurrent Operating Operating lease liabilities 362,094 Finance Long-term debt and finance lease obligations, less current portion and deferred financing costs, net 466 Total lease liabilities 385,148 (a) Finance lease assets are recorded net of accumulated amortization of 1,283 as of March 31, 2019. Lease Cost Three Months Ended Classification March 31, 2019 Operating lease cost (a) Lease and rent expense 15,804 Finance lease cost: Amortization of finance lease assets Depreciation and amortization 67 Interest on finance lease liabilities Interest expense, net 11 Short term lease cost Operating expense 141 Net lease cost 16,023 (a) Includes variable lease costs, which are immaterial Three Months Ended March 31, 2019 Maturity of Lease Liabilities Operating Leases (a) Finance Leases (a) Total 2019 58,586 429 59,015 2020 59,666 212 59,878 2021 60,856 197 61,053 2022 62,075 100 62,175 2023 63,211 — 63,211 After 2023 305,640 — 305,640 Total lease payments 610,034 938 610,972 Less: Interest (225,735 ) (89 ) (225,824 ) Present value of lease liabilities 384,299 849 385,148 (a) Operating and Finance lease payments exclude option to extend lease terms that are not reasonably certain of being exercised. The Company's future minimum lease commitments as of December 31, 2018, under Accounting Standards Codification Topic 840, predecessor to Topic 842, are as follows: Twelve Months Ended December 31, 2018 Maturity of Lease Liabilities Operating Leases (a) Finance Leases (a) Total 2018 58,291 454 58,745 2019 59,391 174 59,565 2020 60,575 173 60,748 2021 61,808 127 61,935 2022 63,065 — 63,065 After 2022 321,797 — 321,797 Total lease payments 624,927 928 625,855 (a) Operating and Finance lease payments exclude option to extend lease terms that are not reasonably certain of being exercised. The measurement of right-of-use assets and lease liabilities requires the Company to estimate appropriate discount rates. To the extent the rate implicit in the lease is readily determinable, such rate is utilized. However, based on information available at lease commencement for the majority of our leases, the rate implicit in the lease is not known. In these instances, the Company utilizes an incremental borrowing rate, which represents the rate of interest that it would pay to borrow on a collateralized basis over a similar term. Lease Term and Discount Rate March 31, 2019 Weighted-average remaining lease term (years) Operating leases 9.77 Finance leases 2.62 Weighted-average discount rate Operating leases 9.9% Finance leases 6.60% Other Information Three Months Ended March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 14,516 Operating cash flows from finance leases $ 11 Financing cash flows from finance leases $ 132 Acquisition of operating leases through adoption of ASC 842 $ 389,403 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2019 | |
Health Care Organizations [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Professional Liability and Other Liability Insurance The Company has professional liability insurance coverage for its nursing centers that, based on historical claims experience, is likely to be substantially less than the claims that are expected to be incurred. Effective July 1, 2013, the Company established a wholly-owned, offshore limited purpose insurance subsidiary, SHC Risk Carriers, Inc. (“SHC”), to replace some of the expiring commercial policies. SHC covers losses up to specified limits per occurrence. All of the Company's nursing centers in Florida, and Tennessee are now covered under the captive insurance policies along with many of the nursing centers in Alabama, Kentucky, and Texas. The insurance coverage provided for these centers under the SHC policy provides coverage limits of at least $1,000 per medical incident with a sublimit per center of $3,000 and total annual aggregate policy limits of $5,000 . All other centers within the Company's portfolio are covered through various commercial insurance policies which provide similar coverage limits per medical incident, per location, and on an aggregate basis for covered centers. The deductibles for these policies are covered through the insurance subsidiary. Reserve for Estimated Self-Insured Professional Liability Claims Because the Company’s actual liability for existing and anticipated professional liability and general liability claims will likely exceed the Company’s limited insurance coverage, the Company has recorded total liabilities for reported and estimated future claims of $24,625 and $27,201 as of March 31, 2019 and December 31, 2018 , respectively. This accrual includes estimates of liability for incurred but not reported claims, estimates of liability for reported but unresolved claims, actual liabilities related to settlements, including settlements to be paid over time, and estimates of legal costs related to these claims. All losses are projected on an undiscounted basis and are presented without regard to any potential insurance recoveries. Amounts are added to the accrual for estimates of anticipated liability for claims incurred during each period, and amounts are deducted from the accrual for settlements paid on existing claims during each period. The Company evaluates the adequacy of this liability on a quarterly basis. Semi-annually, the Company retains a third-party actuarial firm to assist in the evaluation of this reserve. Since May 2012, Merlinos & Associates, Inc. (“Merlinos”) has assisted management in the preparation of the appropriate accrual for incurred but not reported general and professional liability claims based on data furnished as of May 31 and November 30 of each year. Merlinos primarily utilizes historical data regarding the frequency and cost of the Company's past claims over a multi-year period, industry data and information regarding the number of occupied beds to develop its estimates of the Company's ultimate professional liability cost for current periods. On a quarterly basis, the Company obtains reports of asserted claims and lawsuits incurred. These reports, which are provided by the Company’s insurers and a third-party claims administrator, contain information relevant to the actual expense already incurred with each claim as well as the third-party administrator’s estimate of the anticipated total cost of the claim. This information is reviewed by the Company quarterly and provided to the actuary semi-annually. Based on the Company’s evaluation of the actual claim information obtained, the semi-annual estimates received from the third-party actuary, the amounts paid and committed for settlements of claims and on estimates regarding the number and cost of additional claims anticipated in the future, the reserve estimate for a particular period may be revised upward or downward on a quarterly basis. Any increase in the accrual decreases results of operations in the period and any reduction in the accrual increases results of operations during the period. As of March 31, 2019 , the Company is engaged in 78 professional liability lawsuits. Twenty-seven lawsuits are currently scheduled for trial or arbitration during the next twelve months, and it is expected that additional cases will be set for trial or hearing. The Company’s cash expenditures for self-insured professional liability costs from continuing operations were $1,906 and $1,093 for the three months ended March 31, 2019 and 2018 , respectively. The Company follows the accounting guidance in ASC Topic 954 that clarifies that a health care entity should not net insurance recoveries against a related professional liability claim and that the amount of the claim liability should be determined without consideration of insurance recoveries. Accordingly, the estimated insurance recovery receivables are included within "Other Current Assets" and "Other Noncurrent Assets" on the Consolidated Balance Sheet. As of March 31, 2019 there are estimated insurance recovery receivables of $2,125 . There were no estimated insurance recovery receivables as of March 31, 2018. Although the Company adjusts its accrual for professional and general liability claims on a quarterly basis and retains a third-party actuarial firm semi-annually to assist management in estimating the appropriate accrual, professional and general liability claims are inherently uncertain, and the liability associated with anticipated claims is very difficult to estimate. Professional liability cases have a long cycle from the date of an incident to the date a case is resolved, and final determination of the Company’s actual liability for claims incurred in any given period is a process that takes years. As a result, the Company’s actual liabilities may vary significantly from the accrual, and the amount of the accrual has and may continue to fluctuate by a material amount in any given period. Each change in the amount of this accrual will directly affect the Company’s reported earnings and financial position for the period in which the change in accrual is made. Civil Investigative Demand ("CID") In July 2013, the Company learned that the United States Attorney for the Middle District of Tennessee ("DOJ") had commenced a civil investigation of potential violations of the False Claims Act ("FCA"). In October 2014, the Company learned that the investigation was started by the filing under seal of a false claims action against the two centers that were subject of the original civil investigative demand ("CID"). In connection with this matter, between July 2013 and early February 2016, the Company received three civil investigative demands (a form of subpoena) for documents. The Company has responded to those demands and also provided voluntarily additional information requested by the DOJ. The DOJ has also taken testimony from current and former employees of the Company. In May 2018, the Company learned that a second FCA complaint had been filed in late 2016 relating to the Company’s practices and policies for rehabilitation therapy at some of its facilities. The government’s investigation relates to the Company’s practices and policies for rehabilitation and other services at all of its facilities, for preadmission evaluation forms ("PAEs") required by TennCare and for Pre-Admission Screening and Resident Reviews ("PASRRs") required by the Medicare program. Discussions continue with the DOJ regarding settlement of this investigation. The Company denies any wrong doing and is prepared to vigorously defend its actions if a settlement is not reached. The Company accrued $6,400 as a contingent liability in connection with this matter during the three months ended September 30, 2018, but the Company cannot predict whether a settlement can be achieved, the outcome of the litigation if there is no settlement or the length of time necessary to conclude this matter. Accordingly, the contingent liability has been classified as a noncurrent liability in the accompanying interim consolidated balance sheets. The Company’s ultimate ability to settle this investigation will depend on several factors, including whether the amount and terms of an acceptable settlement can be reached with the DOJ, the Company’s assessment of the risks of litigating this case and the effect of protracted litigation or settlement terms on the Company’s business plans. Because the outcome of this investigation and related settlement discussions remain uncertain, there is a reasonable possibility that the amount ultimately incurred in connection with the resolution of this matter could differ materially from the current accrual, as the Company cannot, at this time, estimate the possible range of loss that may result from either a settlement or litigation of this matter. The ultimate outcome of this litigation could have a materially adverse effect on the Company, including the imposition of treble damages, criminal charges, fines, penalties and/or a corporate integrity agreement. In June 2016, the Company received an authorized investigative demand (a form of subpoena) for documents in connection with a criminal investigation by the DOJ related to the practices of some of its employees with respect to PAEs and PASRRs, and the Company provided documents responsive to this subpoena and coordinated examinations of certain employees of the Company. The Company understands that this criminal investigation has been closed, subject to re-opening at the discretion of the government. Other Insurance With respect to workers’ compensation insurance, substantially all of the Company’s employees became covered under either a prefunded deductible policy or state-sponsored programs. The Company has been and remains a non-subscriber to the Texas workers’ compensation system and is, therefore, completely self-insured for employee injuries with respect to its Texas operations. From June 30, 2003 until June 30, 2007, the Company’s workers’ compensation insurance programs provided coverage for claims incurred with premium adjustments depending on incurred losses. From the period from July 1, 2008 through March 31, 2019 , the Company is covered by a prefunded deductible policy. Under this policy, the Company is self-insured for the first $500 per claim, subject to an aggregate maximum of $3,000 . The Company funds a loss fund account with the insurer to pay for claims below the deductible. The Company accounts for premium expense under this policy based on its estimate of the level of claims subject to the policy deductibles expected to be incurred. The liability for workers’ compensation claims is $688 and $618 at March 31, 2019 and December 31, 2018 , respectively.. The Company has a non-current receivable for workers’ compensation policies covering previous years of $1,458 and $1,258 as of March 31, 2019 and December 31, 2018 , respectively. The non-current receivable is a function of payments paid to the Company’s insurance carrier in excess of the estimated level of claims expected to be incurred. As of March 31, 2019 , the Company is self-insured for health insurance benefits for certain employees and dependents for amounts up to $200 per individual annually. The Company provides reserves for the settlement of outstanding self-insured health claims at amounts believed to be adequate. The liability for reported claims and estimates for incurred but unreported claims is $1,444 at March 31, 2019 . The differences between actual settlements and reserves are included in expense in the period finalized. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Overview of Plans In June 2008, the Company adopted the Advocat Inc. 2008 Stock Purchase Plan for Key Personnel (“Stock Purchase Plan”). The Stock Purchase Plan provides for the granting of rights to purchase shares of the Company's common stock to directors and officers. The Stock Purchase Plan allows participants to elect to utilize a specified portion of base salary, annual cash bonus, or director compensation to purchase restricted shares or restricted share units (“RSU's”) at 85% of the quoted market price of a share of the Company's common stock on the date of purchase. The restriction period under the Stock Purchase Plan is generally two years from the date of purchase and during which the shares will have the rights to receive dividends, however, the restricted share certificates will not be delivered to the shareholder and the shares cannot be sold, assigned or disposed of during the restriction period. In June 2016, our shareholders approved an amendment to the Stock Purchase Plan to increase the number of shares of our common stock authorized under the Plan from 150 shares to 350 shares. No grants can be made under the Stock Purchase Plan after April 25, 2028. In April 2010, the Compensation Committee of the Board of Directors adopted the 2010 Long-Term Incentive Plan (“2010 Plan”), followed by approval by the Company's shareholders in June 2010. The 2010 Plan allows the Company to issue stock appreciation rights, stock options and other share and cash based awards. In June 2017, our shareholders approved an amendment to the 2010 Plan to increase the number of shares of our common stock authorized under the 2010 Plan from 380 shares to 680 shares. No grants can be made under the 2010 Plan after May 31, 2027. Equity Grants and Valuations During the three months ended March 31, 2019 and 2018 , the Compensation Committee of the Board of Directors approved grants totaling approximately 151 and 90 shares of restricted common stock to certain employees and members of the Board of Directors, respectively. The fair value of restricted shares is determined as the quoted market price of the underlying common shares at the date of the grant. The restricted shares typically vest one-third on the first, second and third anniversaries of the grant date. Unvested shares may not be sold or transferred. During the vesting period, dividends accrue on the restricted shares, but are paid in additional shares of common stock upon vesting, subject to the vesting provisions of the underlying restricted shares. The restricted shares are entitled to the same voting rights as other common shares. Upon vesting, all restrictions are removed. Our policy is to account for forfeitures of share-based compensation awards as they occur. In computing the fair value estimates using the Black-Scholes-Merton valuation method, the Company took into consideration the exercise price of the equity grants and the market price of the Company's stock on the date of grant. The Company used an expected volatility that equals the historical volatility over the most recent period equal to the expected life of the equity grants. The risk free interest rate is based on the U.S. treasury yield curve in effect at the time of grant. The Company used the expected dividend yield at the date of grant, reflecting the level of annual cash dividends currently being paid on its common stock. Summarized activity of the equity compensation plans is presented below: Weighted Options/ Average SOSARs Exercise Price Outstanding, December 31, 2018 122 $ 7.29 Granted — — Exercised (2 ) 2.37 Expired or cancelled (21 ) 8.39 Outstanding, March 31, 2019 99 $ 7.16 Exercisable, March 31, 2019 89 $ 7.05 Weighted Average Restricted Grant Date Shares Fair Value Outstanding, December 31, 2018 120 $ 8.77 Granted 151 3.93 Dividend Equivalents — — Vested (57 ) 8.91 Cancelled — Outstanding, March 31, 2019 214 $ 5.31 Summarized activity of the Restricted Share Units for the Stock Purchase Plan is as follows: Weighted Average Restricted Grant Date Share Units Fair Value Outstanding, December 31, 2018 43 $ 9.26 Granted 36 3.93 Dividend Equivalents — — Vested (30 ) 9.76 Outstanding, March 31, 2019 49 $ 5.05 The SOSARs and Options were valued and recorded in the same manner, and, other than amounts that may be settled pursuant to employment agreements with certain members of management, will be settled with issuance of new stock for the difference between the market price on the date of exercise and the exercise price. The Company estimated the total recognized and unrecognized compensation related to SOSARs and stock options using the Black-Scholes-Merton equity grant valuation model. The following table summarizes information regarding stock options and SOSAR grants outstanding as of March 31, 2019 : Weighted Average Intrinsic Intrinsic Range of Exercise Grants Value-Grants Grants Value-Grants Exercise Prices Prices Outstanding Outstanding Exercisable Exercisable $8.14 to $10.21 $ 8.83 45 $ — 35 $ — $5.45 to $5.86 $ 5.76 54 $ — 54 $ — 99 89 Stock-based compensation expense is non-cash and is included as a component of general and administrative expense or operating expense based upon the classification of cash compensation paid to the related employees. The Company recorded total stock-based compensation expense of $140 and $236 in the three month periods ended March 31, 2019 and 2018 , respectively. |
EARNINGS PER COMMON SHARE
EARNINGS PER COMMON SHARE | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
EARNINGS PER COMMON SHARE | EARNINGS PER COMMON SHARE Information with respect to basic and diluted net loss per common share is presented below in thousands, except per share: Three Months Ended March 31, 2019 2018 Net loss Loss from continuing operations $ (3,337 ) $ (81 ) Loss from discontinued operations, net of income taxes (9 ) (22 ) Net loss $ (3,346 ) $ (103 ) Three Months Ended March 31, 2019 2018 Net loss per common share: Per common share – basic Loss from continuing operations $ (0.52 ) $ (0.01 ) Loss from discontinued operations — — Net loss per common share – basic $ (0.52 ) $ (0.01 ) Per common share – diluted Loss from continuing operations $ (0.52 ) $ (0.01 ) Loss from discontinued operations — — Net loss per common share – diluted $ (0.52 ) $ (0.01 ) Weighted Average Common Shares Outstanding: Basic 6,424 6,314 Diluted 6,424 6,314 The effects of 99 and 30 SOSARs and options outstanding were excluded from the computation of diluted earnings per common share in the three months ended March 31, 2019 and 2018 , respectively, because these securities would have been anti-dilutive. |
BUSINESS DEVELOPMENTS AND OTHER
BUSINESS DEVELOPMENTS AND OTHER SIGNIFICANT TRANSACTIONS | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
BUSINESS DEVELOPMENTS AND OTHER SIGNIFICANT TRANSACTIONS | BUSINESS DEVELOPMENTS AND OTHER SIGNIFICANT TRANSACTIONS 2018 Assets Sold On October 30, 2018 the Company entered into an Asset Purchase Agreement (the "Agreement") with Fulton Nursing and Rehabilitation, LLC, Holiday Fulton Propco LLC, Birchwood Nursing and Rehabilitation LLC, Padgett Clinton Propco LLC, Westwood Nursing and Rehabilitation LLC, and Westwood Glasgow Propco (the "Buyers") to sell the assets and transfer the operation of Diversicare of Fulton, LLC, Diversicare of Clinton, LLC and Diversicare of Glasgow, LLC (the "Kentucky Properties"). On December 1, 2018, the Company completed the sale of the Kentucky Properties with the Buyers for a purchase price of $18,700 . This transaction did not meet the accounting criteria to be reported as a discontinued operation. The carrying value of these centers' assets were $13,331 , resulting in a gain of $4,825 , with remaining proceeds for miscellaneous closing costs. The proceeds were used to relieve debt, which is required under the terms of the Company's Amended Mortgage Loan and Amended Revolver. Refer to Note 5, "Long-term Debt, Interest Rate Swap" for more information on this transaction. 2018 New Master Lease Agreement On October 1, 2018, the Company entered into a New Master Lease Agreement (the "Lease") with Omega Healthcare Investors (the "Lessor") to lease 34 centers currently owned by Omega and operated by Diversicare. The old Master Lease with Omega provided for its operation of 23 skilled nursing centers in Texas, Kentucky, Alabama, Tennessee, Florida, and Ohio. Additionally, Diversicare operated 11 centers owned by Omega under separate leases in Missouri, Kentucky, Indiana, and Ohio. The Lease entered into by Diversicare and Omega consolidates the leases for all 34 centers under one New Master Lease. The Lease has an initial term of twelve years with two 10 -year extensions. The Lease has a common date of annual lease fixed escalators of 2.15% beginning on October 1, 2019. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS Effective April 1, 2019, the Company expanded it's participation in the Texas Quality Incentive Payment Program (“QIPP”) as administered by the Texas Health and Human Services Commission. Four skilled nursing centers previously operated by the Company entered into a transaction with a Texas medical district participating in the QIPP, providing for the transfer of the provider license from the Company to the medical district. The Company’s operating subsidiary retained the management of the centers on behalf of the medical district. |
CONSOLIDATION AND BASIS OF PR_2
CONSOLIDATION AND BASIS OF PRESENTATION OF FINANCIAL STATEMENTS (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting | The interim consolidated financial statements for the three month periods ended March 31, 2019 and 2018 , included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") have been condensed or omitted pursuant to such rules and regulations. In the opinion of management of the Company, the accompanying interim consolidated financial statements reflect all normal, recurring adjustments necessary to present fairly the Company’s financial position at March 31, 2019 , and the results of operations for the three month periods ended March 31, 2019 and 2018 , changes in shareholders' equity (deficit) for the three month periods ended March 31, 2019 and 2018 , and cash flows for the three month periods ended March 31, 2019 and 2018 . The Company’s balance sheet information at December 31, 2018 , was derived from its audited consolidated financial statements as of December 31, 2018 . Effective January 1, 2019, we adopted the requirements of Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842), as discussed in Notes 3 and 6 to the interim consolidated financial statements. Effective January 1, 2018, we adopted the requirements of ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), as discussed in Notes 3 and 4 to the interim consolidated financial statements. All amounts and disclosures set forth in this Form 10-Q have been updated to comply with the new standards. The results of operations for the periods ended March 31, 2019 and 2018 are not necessarily indicative of the operating results that may be expected for a full year. These interim consolidated financial statements should be read in connection with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 . |
Recent Accounting Standards Adopted and Not Adopted by the Company | Recent Accounting Standards Adopted by the Company In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The standard establishes a right-of-use ("ROU") model that requires a lessee to record a ROU asset and a lease liability on the balance sheet. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. For short-term leases (those with a term of 12 months or less and that do not include a lessee purchase option that is reasonably certain to be exercised), a lessee is permitted to make (and the Company chose to utilize) an accounting policy election by asset class not to recognize ROU assets and lease liabilities, which would generally result in lease expense for these short term leases being recognized on a straight-line basis over the lease term. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company adopted the requirements of this standard effective January 1, 2019. In July 2018, the FASB issued ASU 2018-11, Leases - Targeted Improvements, which allows lessees and lessors to recognize and measure existing leases at the beginning of the period of adoption without modifying the comparative period financial statements (which therefore will remain under prior GAAP, Topic 840, Leases). The Company elected to use the optional expedient to reflect adoption in the period of adoption (January 1, 2019) rather than the earliest period presented. The Company also elected the package of practical expedients upon transition, which includes retaining the lease classification for any leases that exist prior to adoption of the standard. The adoption of the new standard resulted in the recording of net lease assets and lease liabilities of $384,187 and $389,403 , respectively, as of January 1, 2019. The standard did not materially impact our consolidated net earnings and had no impact on cash flows. See Note 6, "Leases" for a discussion regarding leases under the new standard. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities, which is intended to simplify and amend the application of hedge accounting to more clearly portray the economics of an entity’s risk management strategies in its financial statements. The new guidance will make more financial and nonfinancial hedging strategies eligible for hedge accounting and reduce complexity in fair value hedges of interest rate risk. The new guidance also changes how companies assess effectiveness and amends the presentation and disclosure requirements. The new guidance eliminates the requirement to separately measure and report hedge ineffectiveness and generally the entire change in the fair value of a hedging instrument will be required to be presented in the same income statement line as the hedged item. The new guidance also eases certain documentation and assessment requirements and modifies the accounting for components excluded from the assessment of hedge effectiveness. The new guidance is effective for public entities for fiscal years beginning after December 15, 2018, including interim periods within those years. The Company adopted the requirements of this standard effective January 1, 2019. The adoption did not have a material impact on our consolidated financial statements and related disclosures. In February 2018, the FASB issued ASU No. 2018-02, Income Statement- Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The new guidance allows entities the option to reclassify stranded tax effects resulting from the Tax Cuts and Jobs Act from accumulated other comprehensive income (OCI) to retained earnings. The new guidance allows the option to apply the guidance retrospectively or in the period of adoption. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. The Company adopted the requirements of this standard effective January 1, 2019. The adoption did not have a material impact on our consolidated financial statements and related disclosures. In June 2018, the FASB issued ASU No. 2018-07, Compensation-Stock Compensation (Topic 718): Improvement to Nonemployee Share-Based Payment Accounting, which modifies the accounting for share-based payment awards issued to nonemployees to largely align it with the accounting for share-based payment awards issued to employees. The standard is effective for fiscal years beginning after December 15, 2018. The Company adopted the requirements of this standard effective January 1, 2019. The adoption did not have a material impact on our consolidated financial statements and related disclosures. In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which outlines a single comprehensive model for recognizing revenue and supersedes most existing revenue recognition guidance, including guidance specific to the healthcare industry. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2017. The Company adopted the requirements of this standard effective January 1, 2018. The Company elected to apply the modified retrospective approach with the cumulative transition effect recognized in beginning retained earnings as of the date of adoption. The adoption of ASC 606 represents a change in accounting principle that more closely aligns revenue recognition with the delivery of the Company's services. The cumulative effect of applying the new guidance to all contracts with customers as of January 1, 2018 was not material to the interim consolidated financial statements. See Note 4, "Revenue Recognition" for a discussion regarding revenue recognition under the new standard. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230). The ASU provides clarification regarding how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The new guidance addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The ASU is effective for annual and interim periods beginning after December 15, 2017, which required the Company to adopt these provisions in the first quarter of fiscal 2018 using a retrospective approach. The adoption did not have a material impact on our financial position, results of operations or cash flows. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires that the Statement of Cash Flows explain the changes during the period of cash and cash equivalents inclusive of amounts categorized as Restricted Cash. As a result, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The standard is effective for periods beginning after December 15, 2017, which required the Company to adopt these provisions in the first quarter of fiscal 2018. The adoption did not have a material impact on our financial position, results of operations or cash flows. In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805) - Clarifying the Definition of a Business, which provides guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The adoption is effective for annual and interim periods beginning after December 15, 2017. The Company will evaluate future acquisitions under this guidance, which may result in future acquisitions being accounted for as asset acquisitions. In May 2017, the FASB issued ASU No. 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. The amended standard specifies the modification accounting applicable to any entity which changes the terms or conditions of a share-based payment award. The new guidance is effective for all entities after December 15, 2017. The adoption did not have a material impact on our financial position, results of operations or cash flows. Accounting Standards Recently Issued But Not Yet Adopted by the Company In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The new guidance intends to improve financial reporting by requiring timelier recognition of credit losses on loans and other financial instruments that are not accounted for at fair value through net income, including loans held for investment, held-to-maturity debt securities, trade and other receivables, net investment in leases and other such commitments. This update requires that financial statement assets measured at an amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. This standard is effective for the fiscal year beginning after December 15, 2019 with early adoption permitted. The Company is in the initial stages of evaluating the impact from the adoption of this new standard on the consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurements (Topic 820): Disclosure Framework- Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in this update modify the disclosure requirements of fair value measurements under Topic 820. The standard is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company is evaluating the effect this guidance will have on our consolidated financial statements and related disclosures. In October 2018, the FASB issued ASU No. 2018-16, Derivatives and Hedging (Topic 805): Inclusion of the Secured Overnight Financing Rate ("SOFR") Overnight Index Swap ("OIS") Rate as a Benchmark Interest Rate for Hedge Accounting Purposes. The ASU amends ASC 815 to add the OIS rate based on the SOFR as a fifth US benchmark interest rate. The Company is evaluating the effect this guidance will have on our consolidated financial statements and related disclosures. |
Revenue Recognition | On January 1, 2018, the Company adopted Accounting Standards Codification ("ASC") 606 using the modified retrospective method for all contracts as of the date of adoption. The adoption of ASC 606 represents a change in accounting principle that more closely aligns revenue recognition with the delivery of the Company's services. The cumulative effect of applying the new guidance to all contracts with customers as of January 1, 2018 was not material to the interim consolidated financial statements. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. ASC 606 requires companies to exercise more judgment and recognize revenue in accordance with the standard's core principle by applying the following five steps: Step 1: Identify the contract with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. Performance obligations are promises made in a contract to transfer a distinct good or service to the customer. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The Company has concluded that the contracts with patients and residents represent a bundle of distinct services that are substantially the same, with the same pattern of transfer to the customer. Accordingly, the promise to provide quality care is accounted for as a single performance obligation. The Company performed analyses using the application of the portfolio approach as a practical expedient to group patient contracts with similar characteristics, such that revenue for a given portfolio would not be materially different than if it were evaluated on a contract-by-contract basis. These analyses incorporated consideration of reimbursements at varying rates from Medicaid, Medicare, Managed Care, Private Pay, Assisted Living, Hospice, and Veterans for services provided in each corresponding state. It was determined that the contracts are not materially different for the following groups: Medicaid, Medicare, Managed Care and Private Pay and other (Assisted Living, Hospice and Veterans). In order to determine the transaction price, the Company estimates the amount of variable consideration at the beginning of the contract using the expected value method. The estimates consider (i) payor type, (ii) historical payment trends, (iii) the maturity of the portfolio, and (iv) geographic payment trends throughout a class of similar payors. The Company typically enters into agreements with third-party payors that provide for payments at amounts different from the established charges. These arrangement terms provide for subsequent settlement and cash flows that may occur well after the service is provided. The Company constrains (reduces) the estimates of variable consideration such that it is probable that a significant reversal of previously recognized revenue will not occur throughout the life of the contract. Changes in the Company's expectation of the amount it will receive from the patient or third-party payors will be recorded in revenue unless there is a specific event that suggests the patient or third-party payor no longer has the ability and intent to pay the amount due and, therefore, the changes in its estimate of variable consideration better represent an impairment, or bad debt. These estimates are re-assessed each reporting period, and any amounts allocated to a satisfied performance obligation are recognized as revenue or a reduction of revenue in the period in which the transaction price changes. The Company satisfies its performance obligation by providing quality of care services to its patients and residents on a daily basis until termination of the contract. The performance obligation is recognized on a time elapsed basis, by day, for which the services are provided. For these contracts, the Company has the right to consideration from the customer in an amount that directly corresponds with the value to the customer of the Company's performance to date. Therefore, the Company recognizes revenue based on the amount billable to the customer in accordance with the practical expedient in ASC 606-10-55-18. Additionally, because the Company applied ASC 606 using certain practical expedients, the Company elected not to disclose the aggregate amount of the transaction price for unsatisfied, or partially unsatisfied, performance obligations for all contracts with an original expected length of one year or less. The Company incurs costs related to patient/resident contracts, such as legal and advertising expenses. The contract costs are expensed as incurred. They are not expected to be recovered and are not chargeable to the patient/resident regardless of whether the contract is executed. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table summarizes revenue from contracts with customers by payor source for the periods presented (dollar amounts in thousands): Three Months Ended March 31, 2019 2018 Medicaid $ 63,531 47.3 % $ 63,886 45.2 % Medicare 25,055 18.6 % 29,751 21.1 % Managed Care 14,175 10.6 % 14,212 10.1 % Private Pay and other 31,592 23.5 % 33,436 23.6 % Total $ 134,353 100.0 % $ 141,285 100.0 % |
Schedule of Accounts Receivable | Accounts receivable as of March 31, 2019 and December 31, 2018 are summarized in the following table: March 31, December 31, 2019 2018 Medicaid $ 25,971 $ 27,532 Medicare 13,249 15,706 Managed Care 9,083 8,126 Private Pay and other 15,561 14,893 Total accounts receivable $ 63,864 $ 66,257 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Assets and Liabilities, Leases | Leases Classification March 31, 2019 Assets Operating lease assets Operating lease assets 377,799 Finance lease assets Property and equipment, net (a) 1,045 Total leased assets 378,844 Liabilities Current Operating Current portion of operating lease liabilities 22,205 Finance Current portion of long-term debt and finance lease obligations, net 383 Noncurrent Operating Operating lease liabilities 362,094 Finance Long-term debt and finance lease obligations, less current portion and deferred financing costs, net 466 Total lease liabilities 385,148 (a) Finance lease assets are recorded net of accumulated amortization of 1,283 as of March 31, 2019. |
Lease, Cost | Lease Cost Three Months Ended Classification March 31, 2019 Operating lease cost (a) Lease and rent expense 15,804 Finance lease cost: Amortization of finance lease assets Depreciation and amortization 67 Interest on finance lease liabilities Interest expense, net 11 Short term lease cost Operating expense 141 Net lease cost 16,023 (a) Includes variable lease costs, which are immaterial |
Lessee, Operating Lease, Liability, Maturity | Three Months Ended March 31, 2019 Maturity of Lease Liabilities Operating Leases (a) Finance Leases (a) Total 2019 58,586 429 59,015 2020 59,666 212 59,878 2021 60,856 197 61,053 2022 62,075 100 62,175 2023 63,211 — 63,211 After 2023 305,640 — 305,640 Total lease payments 610,034 938 610,972 Less: Interest (225,735 ) (89 ) (225,824 ) Present value of lease liabilities 384,299 849 385,148 (a) Operating and Finance lease payments exclude option to extend lease terms that are not reasonably certain of being exercised. The Company's future minimum lease commitments as of December 31, 2018, under Accounting Standards Codification Topic 840, predecessor to Topic 842, are as follows: Twelve Months Ended December 31, 2018 Maturity of Lease Liabilities Operating Leases (a) Finance Leases (a) Total 2018 58,291 454 58,745 2019 59,391 174 59,565 2020 60,575 173 60,748 2021 61,808 127 61,935 2022 63,065 — 63,065 After 2022 321,797 — 321,797 Total lease payments 624,927 928 625,855 (a) Operating and Finance lease payments exclude option to extend lease terms that are not reasonably certain of being exercised. |
Finance Lease, Liability, Maturity | Three Months Ended March 31, 2019 Maturity of Lease Liabilities Operating Leases (a) Finance Leases (a) Total 2019 58,586 429 59,015 2020 59,666 212 59,878 2021 60,856 197 61,053 2022 62,075 100 62,175 2023 63,211 — 63,211 After 2023 305,640 — 305,640 Total lease payments 610,034 938 610,972 Less: Interest (225,735 ) (89 ) (225,824 ) Present value of lease liabilities 384,299 849 385,148 (a) Operating and Finance lease payments exclude option to extend lease terms that are not reasonably certain of being exercised. The Company's future minimum lease commitments as of December 31, 2018, under Accounting Standards Codification Topic 840, predecessor to Topic 842, are as follows: Twelve Months Ended December 31, 2018 Maturity of Lease Liabilities Operating Leases (a) Finance Leases (a) Total 2018 58,291 454 58,745 2019 59,391 174 59,565 2020 60,575 173 60,748 2021 61,808 127 61,935 2022 63,065 — 63,065 After 2022 321,797 — 321,797 Total lease payments 624,927 928 625,855 (a) Operating and Finance lease payments exclude option to extend lease terms that are not reasonably certain of being exercised. |
Summary of Other Lease Information | Lease Term and Discount Rate March 31, 2019 Weighted-average remaining lease term (years) Operating leases 9.77 Finance leases 2.62 Weighted-average discount rate Operating leases 9.9% Finance leases 6.60% Other Information Three Months Ended March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 14,516 Operating cash flows from finance leases $ 11 Financing cash flows from finance leases $ 132 Acquisition of operating leases through adoption of ASC 842 $ 389,403 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summarized activity of equity compensation plans | Summarized activity of the equity compensation plans is presented below: Weighted Options/ Average SOSARs Exercise Price Outstanding, December 31, 2018 122 $ 7.29 Granted — — Exercised (2 ) 2.37 Expired or cancelled (21 ) 8.39 Outstanding, March 31, 2019 99 $ 7.16 Exercisable, March 31, 2019 89 $ 7.05 |
Schedule of summarized activity of Restricted Share Units | Weighted Average Restricted Grant Date Shares Fair Value Outstanding, December 31, 2018 120 $ 8.77 Granted 151 3.93 Dividend Equivalents — — Vested (57 ) 8.91 Cancelled — Outstanding, March 31, 2019 214 $ 5.31 Summarized activity of the Restricted Share Units for the Stock Purchase Plan is as follows: Weighted Average Restricted Grant Date Share Units Fair Value Outstanding, December 31, 2018 43 $ 9.26 Granted 36 3.93 Dividend Equivalents — — Vested (30 ) 9.76 Outstanding, March 31, 2019 49 $ 5.05 |
Schedule of summarized information regarding stock options and SOSAR grants outstanding | The following table summarizes information regarding stock options and SOSAR grants outstanding as of March 31, 2019 : Weighted Average Intrinsic Intrinsic Range of Exercise Grants Value-Grants Grants Value-Grants Exercise Prices Prices Outstanding Outstanding Exercisable Exercisable $8.14 to $10.21 $ 8.83 45 $ — 35 $ — $5.45 to $5.86 $ 5.76 54 $ — 54 $ — 99 89 |
EARNINGS PER COMMON SHARE (Tabl
EARNINGS PER COMMON SHARE (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Basic and diluted net income (loss) per common share | Information with respect to basic and diluted net loss per common share is presented below in thousands, except per share: Three Months Ended March 31, 2019 2018 Net loss Loss from continuing operations $ (3,337 ) $ (81 ) Loss from discontinued operations, net of income taxes (9 ) (22 ) Net loss $ (3,346 ) $ (103 ) Three Months Ended March 31, 2019 2018 Net loss per common share: Per common share – basic Loss from continuing operations $ (0.52 ) $ (0.01 ) Loss from discontinued operations — — Net loss per common share – basic $ (0.52 ) $ (0.01 ) Per common share – diluted Loss from continuing operations $ (0.52 ) $ (0.01 ) Loss from discontinued operations — — Net loss per common share – diluted $ (0.52 ) $ (0.01 ) Weighted Average Common Shares Outstanding: Basic 6,424 6,314 Diluted 6,424 6,314 |
BUSINESS (Details)
BUSINESS (Details) | Mar. 31, 2019statecenterbed | Oct. 01, 2018center |
Accounting Policies [Line Items] | ||
Number of states in which entity operates | state | 10 | |
Number of nursing centers | center | 72 | |
Number of licensed nursing beds | 8,214 | |
Number of nursing center facilities owned | center | 15 | |
Number of nursing center facilities leased | center | 57 | 34 |
Number of licensed assisted and residential living beds | 429 | |
Minimum | ||
Accounting Policies [Line Items] | ||
Number of licensed nursing beds per center | 48 | |
Maximum | ||
Accounting Policies [Line Items] | ||
Number of licensed nursing beds per center | 320 |
RECENT ACCOUNTING GUIDANCE RECE
RECENT ACCOUNTING GUIDANCE RECENT ACCOUNTING GUIDANCE (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 |
Accounting Policies [Abstract] | ||
Net lease assets | $ 378,844 | $ 384,187 |
Lease liabilities | $ 385,148 | $ 389,403 |
REVENUE RECOGNITION - Disaggreg
REVENUE RECOGNITION - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 134,353 | |
Total revenues, as a percent | 100.00% | |
Medicaid | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 63,531 | |
Total revenues, as a percent | 47.30% | |
Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 25,055 | |
Total revenues, as a percent | 18.60% | |
Managed Care | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 14,175 | |
Total revenues, as a percent | 10.60% | |
Private Pay and other | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 31,592 | |
Total revenues, as a percent | 23.50% | |
Calculated under Revenue Guidance in Effect before Topic 606 | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 141,285 | |
Total revenues, as a percent | 100.00% | |
Calculated under Revenue Guidance in Effect before Topic 606 | Medicaid | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 63,886 | |
Total revenues, as a percent | 45.20% | |
Calculated under Revenue Guidance in Effect before Topic 606 | Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 29,751 | |
Total revenues, as a percent | 21.10% | |
Calculated under Revenue Guidance in Effect before Topic 606 | Managed Care | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 14,212 | |
Total revenues, as a percent | 10.10% | |
Calculated under Revenue Guidance in Effect before Topic 606 | Private Pay and other | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 33,436 | |
Total revenues, as a percent | 23.60% |
REVENUE RECOGNITION - Summary o
REVENUE RECOGNITION - Summary of Accounts Receivable (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable | $ 63,864 | $ 66,257 |
Medicaid | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable | 25,971 | 27,532 |
Medicare | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable | 13,249 | 15,706 |
Managed Care | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable | 9,083 | 8,126 |
Private Pay and other | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable | $ 15,561 | $ 14,893 |
LONG-TERM DEBT AND INTEREST R_2
LONG-TERM DEBT AND INTEREST RATE SWAP (Details) | Dec. 01, 2018USD ($) | Feb. 26, 2016USD ($)center | Mar. 31, 2019USD ($)letter_of_credit | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | Aug. 01, 2017USD ($) | Jun. 30, 2017USD ($) | Dec. 29, 2016USD ($) | Dec. 28, 2016USD ($) | Oct. 03, 2016USD ($) |
Line of Credit Facility [Line Items] | ||||||||||
Accumulated other comprehensive income (loss) | $ 774,000 | $ 837,000 | ||||||||
Income tax benefit, interest rate swap | (955,000) | $ (38,000) | ||||||||
Interest rate swap | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Notional amount of interest rate derivatives | $ 27,450,000 | |||||||||
Annual fixed rate percentage | 5.79% | |||||||||
Net asset based on interest rate swap valuation model | $ 230,000 | |||||||||
Accumulated other comprehensive income (loss) | 161,000 | |||||||||
Income tax benefit, interest rate swap | $ 69,000 | |||||||||
Amended and restated credit agreement | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Loan acquisition costs | $ 2,162,000 | |||||||||
Number of letters of credit | letter_of_credit | 4 | |||||||||
Credit agreement | Amended and restated credit agreement | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Borrowing capacity | $ 100,000,000 | |||||||||
Term of agreements | 5 years | |||||||||
Mortgage loan | Amended and restated credit agreement | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Borrowing capacity | $ 72,500,000 | |||||||||
Term of agreements | 5 years | |||||||||
Period of amortization | 25 years | |||||||||
Amended mortgage loan balance | $ 58,150,000 | |||||||||
Number of owned nursing centers to secure Amended Mortgage Loan | center | 15 | |||||||||
Mortgage loan | Amended and restated credit agreement | Interest rate swap | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Debt interest rate at period end | 5.79% | |||||||||
Amended revolver | Amended and restated credit agreement | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Borrowing capacity | $ 42,250,000 | $ 27,500,000 | 36,679,000 | $ 42,250,000 | $ 42,250,000 | $ 52,250,000 | ||||
Fixed charge coverage ratio | 1.01 | |||||||||
Repayments of lines of credit | 4,947,000 | |||||||||
Borrowings outstanding | $ 16,500,000 | $ 15,000,000 | ||||||||
Interest rate during period | 6.50% | |||||||||
Balance available for borrowing under revolving credit center | $ 6,585,000 | |||||||||
Amended revolver | Amended and restated credit agreement | LIBOR | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Interest rate percentage | 4.00% | |||||||||
Letter of credit | Amended and restated credit agreement | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Borrowing capacity | $ 15,000,000 | $ 10,000,000 | ||||||||
Annual fees for letters of credit issued under Revolver (as a percentage) | 3.00% | |||||||||
Mortgage term loan | Mortgage loan | Amended and restated credit agreement | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Borrowing capacity | $ 60,000,000 | |||||||||
Debt interest rate at period end | 6.50% | |||||||||
Amended mortgage loan balance | $ 51,250,000 | |||||||||
Increase to credit facility limit | $ 7,500,000 | |||||||||
Mortgage term loan | Mortgage loan | Amended and restated credit agreement | Interest rate swap | Designated as hedging instrument | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Notional amount of interest rate derivatives | $ 30,000,000 | |||||||||
Mortgage term loan | Mortgage loan | Amended and restated credit agreement | LIBOR | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Interest rate percentage | 4.00% | |||||||||
Mortgage term loan | Amended revolver | Amended and restated credit agreement | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Repayments of lines of credit | 11,100,000 | |||||||||
Acquisition loan facility | Mortgage loan | Amended and restated credit agreement | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Borrowing capacity | $ 12,500,000 | |||||||||
Debt interest rate at period end | 7.25% | |||||||||
Amended mortgage loan balance | $ 6,900,000 | |||||||||
Acquisition loan facility | Mortgage loan | Amended and restated credit agreement | LIBOR | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Interest rate percentage | 4.75% | |||||||||
Acquisition loan facility | Amended revolver | Amended and restated credit agreement | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Borrowing capacity | 10,400,000 | |||||||||
Repayments of lines of credit | $ 2,100,000 | |||||||||
Omega Healthcare Investors Inc | Amended revolver | Amended and restated credit agreement | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Letters of credit security deposit for a lease | $ 13,594,000 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) | 3 Months Ended |
Mar. 31, 2019 | |
Lessee, Lease, Description [Line Items] | |
Other leases renewal term | 20 years |
Other leases termination period | 1 year |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Other leases remaining lease term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Other leases remaining lease term | 12 years |
LEASES - Balance Sheet Classifi
LEASES - Balance Sheet Classification (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Jan. 01, 2019 | |
Leases [Abstract] | ||
Finance Lease, Right-of-Use Asset, Accumulated Amortization | $ 1,283 | |
Assets [Abstract] | ||
Operating lease assets | 377,799 | |
Finance lease assets | 1,045 | |
Total leased assets | 378,844 | $ 384,187 |
Liabilities, Current [Abstract] | ||
Current portion of operating lease liabilities | 22,205 | |
Finance lease, current | 383 | |
Liabilities, Noncurrent [Abstract] | ||
Operating lease liabilities, less current portion | 362,094 | |
Finance lease, noncurrent | 466 | |
Total lease liabilities | 385,148 | $ 389,403 |
Amortization of finance lease assets | $ 67 |
LEASES - Lease Cost (Details)
LEASES - Lease Cost (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 15,804 |
Finance Lease, Cost [Abstract] | |
Amortization of finance lease assets | 67 |
Interest on finance lease liabilities | 11 |
Short term lease cost | 141 |
Net lease cost | $ 16,023 |
LEASES - Maturities of Operatin
LEASES - Maturities of Operating and Financing Lease Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Operating Leases | ||
2019 | $ 58,586 | |
2020 | 59,666 | |
2021 | 60,856 | |
2022 | 62,075 | |
2023 | 63,211 | |
After 2023 | 305,640 | |
Total lease payments | 610,034 | |
Less: Interest | (225,735) | |
Present value of lease liabilities | 384,299 | |
2019 | $ 58,291 | |
2020 | 59,391 | |
2021 | 60,575 | |
2022 | 61,808 | |
2023 | 63,065 | |
After 2023 | 321,797 | |
Total lease payments | 624,927 | |
Finance Leases | ||
2019 | 429 | |
2020 | 212 | |
2021 | 197 | |
2022 | 100 | |
2023 | 0 | |
After 2023 | 0 | |
Total lease payments | 938 | |
Less: Interest | (89) | |
Present value of lease liabilities | 849 | |
2018 | 454 | |
2019 | 174 | |
2020 | 173 | |
2021 | 127 | |
2022 | 0 | |
After 2022 | 0 | |
Total lease payments | 928 | |
Operating and Finance Lease Liabilities, Payments, Due [Abstract] | ||
2019 | 59,015 | 58,745 |
2020 | 59,878 | 59,565 |
2021 | 61,053 | 60,748 |
2022 | 62,175 | 61,935 |
2023 | 63,211 | 63,065 |
After 2023 | 305,640 | 321,797 |
Total lease payments | 610,972 | $ 625,855 |
Less: Interest | (225,824) | |
Present value of lease liabilities | $ 385,148 |
LEASES - Other Lease Informatio
LEASES - Other Lease Information (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Weighted-average remaining lease term (years) | |
Operating leases | 9 years 9 months 7 days |
Finance leases | 2 years 7 months 13 days |
Weighted-average discount rate | |
Operating leases | 9.90% |
Finance leases | 6.60% |
Operating cash flows from operating leases | $ 14,516 |
Operating cash flows from finance leases | 11 |
Financing cash flows from finance leases | 132 |
Acquisition of operating leases through adoption of ASC 842 | $ 389,403 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 3 Months Ended | 32 Months Ended | ||||
Mar. 31, 2019USD ($)lawsuit | Mar. 31, 2018USD ($) | Feb. 29, 2016civil_investigative_demand | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Oct. 31, 2014facility | |
Malpractice Insurance [Line Items] | ||||||
Number of professional liability lawsuits | lawsuit | 78 | |||||
Cash expenditures for self-insured professional liability costs | $ 1,906,000 | $ 1,093,000 | ||||
Estimated insurance recovery receivables | 2,125,000 | |||||
Litigation contingency | 6,400,000 | $ 6,400,000 | $ 6,400,000 | |||
Other Insurance | ||||||
Liability for workers compensation claims | 688,000 | 618,000 | ||||
Workers compensation insurance, non current receivable for excess premiums paid | 1,458,000 | 1,258,000 | ||||
Unfavorable regulatory action | Potential violations of false claims act | ||||||
Malpractice Insurance [Line Items] | ||||||
Number of facilities | facility | 2 | |||||
Number of civil investigative demands received | civil_investigative_demand | 3 | |||||
Professional malpractice liability insurance | ||||||
Malpractice Insurance [Line Items] | ||||||
Liability for reported and estimated future claims | 24,625,000 | $ 27,201,000 | ||||
Prefunded deductible policy | ||||||
Malpractice Insurance [Line Items] | ||||||
Insurance policy coverage limits per claim | 500,000 | |||||
Other Insurance | ||||||
Insurance policy coverage limits per claim | 500,000 | |||||
Professional liability insurance, annual coverage limit per facility | 3,000,000 | |||||
Health insurance, maximum self-insured annual amount per individual | 200,000 | |||||
Liability for reported claims and estimates for incurred but unreported claims | 1,444,000 | |||||
SHC Risk Carriers, Inc | Professional malpractice liability insurance | ||||||
Malpractice Insurance [Line Items] | ||||||
Insurance policy coverage limits per claim | 1,000,000 | |||||
Malpractice insurance annual sublimit per center | 3,000,000 | |||||
Aggregate policy limit | 5,000,000 | |||||
Other Insurance | ||||||
Insurance policy coverage limits per claim | $ 1,000,000 | |||||
Scheduled for trial or arbitration over next 12 months | ||||||
Malpractice Insurance [Line Items] | ||||||
Number of professional liability lawsuits | lawsuit | 27 |
STOCK-BASED COMPENSATION - Nar
STOCK-BASED COMPENSATION - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |||||
Mar. 31, 2019 | Mar. 31, 2018 | Jun. 30, 2017 | May 31, 2017 | Jun. 30, 2016 | May 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation expense | $ 140 | $ 236 | ||||
Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Grant of restricted common stock (shares) | 151,000 | 90,000 | ||||
Restricted Stock | First anniversary of grant date | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage of awards | 33.33% | |||||
Restricted Stock | Second anniversary of grant date | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage of awards | 33.33% | |||||
Restricted Stock | Third anniversary of grant date | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage of awards | 33.33% | |||||
2008 Stock Purchase Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of quoted market price offering rate | 85.00% | |||||
Restriction period | 2 years | |||||
Shares authorized under the plan (shares) | 350,000 | 150,000 | ||||
2010 Long Term Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares reserved for future issuance (shares) | 680,000 | 380,000 |
STOCK-BASED COMPENSATION - Sch
STOCK-BASED COMPENSATION - Schedule of Activity of Equity Compensation Plans (Details) - Stock Options and Stock Appreciation Rights (SARs) shares in Thousands | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Number of Shares | |
Outstanding, beginning (shares) | shares | 122 |
Granted (shares) | shares | 0 |
Exercised (shares) | shares | (2) |
Expired or cancelled (shares) | shares | (21) |
Outstanding, ending (shares) | shares | 99 |
Exercisable (shares) | shares | 89 |
Weighted Average Exercise Price | |
Outstanding, beginning (dollars per share) | $ / shares | $ 7.29 |
Granted (dollars per share) | $ / shares | 0 |
Exercised (dollars per share) | $ / shares | 2.37 |
Expired or cancelled (dollars per share) | $ / shares | 8.39 |
Outstanding, ending (dollars per share) | $ / shares | 7.16 |
Exercisable, weighted average exercise price (dollars per share) | $ / shares | $ 7.05 |
STOCK-BASED COMPENSATION - S_2
STOCK-BASED COMPENSATION - Schedule of Restricted Stock and Restricted Stock Units Activity (Details) shares in Thousands | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Restricted Stock Units (RSUs) | |
Number of Shares | |
Outstanding, beginning (share) | shares | 120 |
Granted (shares) | shares | 151 |
Dividend Equivalents (shares) | shares | 0 |
Vested (shares) | shares | (57) |
Cancelled (shares) | shares | 0 |
Outstanding, ending (shares) | shares | 214 |
Weighted Average Granted Date Fair Value | |
Outstanding, beginning (dollars per share) | $ / shares | $ 8.77 |
Granted (dollars per share) | $ / shares | 3.93 |
Dividend Equivalents (dollars per share) | $ / shares | 0 |
Vested (dollars per share) | $ / shares | 8.91 |
Cancelled (dollars per share) | $ / shares | |
Outstanding, ending (dollars per share) | $ / shares | $ 5.31 |
Employee Stock | |
Number of Shares | |
Outstanding, beginning (share) | shares | 43 |
Granted (shares) | shares | 36 |
Dividend Equivalents (shares) | shares | 0 |
Vested (shares) | shares | (30) |
Outstanding, ending (shares) | shares | 49 |
Weighted Average Granted Date Fair Value | |
Outstanding, beginning (dollars per share) | $ / shares | $ 9.26 |
Granted (dollars per share) | $ / shares | 3.93 |
Dividend Equivalents (dollars per share) | $ / shares | 0 |
Vested (dollars per share) | $ / shares | 9.76 |
Outstanding, ending (dollars per share) | $ / shares | $ 5.05 |
STOCK-BASED COMPENSATION - S_3
STOCK-BASED COMPENSATION - Schedule of Awards Outstanding and Exercisable (Details) - Stock Options and Stock Appreciation Rights (SARs) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average exercise prices (dollars per share) | $ 7.16 | $ 7.29 |
Grants outstanding (shares) | 99 | |
Grants exercisable (shares) | 89 | |
$8.14 to $10.21 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Range of exercise prices, minimum (dollars per share) | $ 8.14 | |
Range of exercise prices, maximum (dollars per share) | 10.21 | |
Weighted average exercise prices (dollars per share) | $ 8.83 | |
Grants outstanding (shares) | 45 | |
Intrinsic value - grants outstanding | $ 0 | |
Grants exercisable (shares) | 35 | |
Intrinsic value - grants exercisable | $ 0 | |
$5.45 to $5.86 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Range of exercise prices, minimum (dollars per share) | $ 5.45 | |
Range of exercise prices, maximum (dollars per share) | 5.86 | |
Weighted average exercise prices (dollars per share) | $ 5.76 | |
Grants outstanding (shares) | 54 | |
Intrinsic value - grants outstanding | $ 0 | |
Grants exercisable (shares) | 54 | |
Intrinsic value - grants exercisable | $ 0 |
EARNINGS PER COMMON SHARE - Ba
EARNINGS PER COMMON SHARE - Basic and Diluted Net Income (Loss) Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Net loss | ||
Loss from continuing operations | $ (3,337) | $ (81) |
Loss from discontinued operations, net of income taxes | (9) | (22) |
Net loss | $ (3,346) | $ (103) |
Per common share – basic | ||
Income (loss) from continuing operations (dollars per share) | $ (0.52) | $ (0.01) |
Loss from discontinued operations (dollars per share) | 0 | 0 |
Net income (loss) per common share – basic (dollars per share) | (0.52) | (0.01) |
Per common share – diluted | ||
Income (loss) from continuing operations (dollars per share) | (0.52) | (0.01) |
Loss from discontinued operations (dollars per share) | 0 | 0 |
Net income (loss) per common share – diluted (dollars per share) | $ (0.52) | $ (0.01) |
Weighted Average Common Shares Outstanding: | ||
Basic (shares) | 6,424 | 6,314 |
Diluted (shares) | 6,424 | 6,314 |
EARNINGS PER COMMON SHARE - Na
EARNINGS PER COMMON SHARE - Narrative (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Earnings Per Share [Abstract] | ||
Antidilutive shares excluded from computation of diluted earnings per share (shares) | 99 | 30 |
BUSINESS DEVELOPMENTS AND OTH_2
BUSINESS DEVELOPMENTS AND OTHER SIGNIFICANT TRANSACTIONS - Narrative (Details) $ in Thousands | Dec. 01, 2018USD ($) | Oct. 01, 2018extensioncenter | Dec. 31, 2018USD ($) | Mar. 31, 2019center |
Business Acquisition [Line Items] | ||||
Number of nursing center facilities leased | center | 34 | 57 | ||
Number of skilled nursing centers under lease | center | 23 | |||
Operating lease, initial term | 12 years | |||
Number of lease extensions allowed | extension | 2 | |||
Lease extension period | 10 years | |||
Annual lease fixed escalators, percent | 2.15% | |||
Kentucky Properties | ||||
Business Acquisition [Line Items] | ||||
Proceeds from sale of assets | $ | $ 18,700 | |||
Carrying value of centers | $ | $ 13,331 | |||
Gain on disposition of assets | $ | $ 4,825 | |||
Omega Healthcare Investors Inc | ||||
Business Acquisition [Line Items] | ||||
Number of nursing center facilities leased | center | 11 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) | Apr. 01, 2019USD ($)center | Mar. 31, 2019USD ($) | Dec. 01, 2018USD ($) | Aug. 01, 2017USD ($) | Jun. 30, 2017USD ($) | Oct. 03, 2016USD ($) | Feb. 26, 2016USD ($) |
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Number of skilled nursing centers participating in QIPP | center | 4 | ||||||
Amended and restated credit agreement | Amended revolver | |||||||
Subsequent Event [Line Items] | |||||||
Borrowing capacity | $ 36,679,000 | $ 42,250,000 | $ 42,250,000 | $ 42,250,000 | $ 52,250,000 | $ 27,500,000 | |
Amended and restated credit agreement | Amended revolver | Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Reduction in line of credit capacity | $ 2,000,000 | ||||||
Affiliated Revolving Credit Agreement | Amended revolver | Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Reduction in line of credit capacity | 1,000,000 | ||||||
Borrowing capacity | $ 5,000,000 |