November 22, 2019
Mike Pykosz
Chief Executive Officer
Oak Street Health, Inc.
30 W. Monroe Street
Suite 1200
Chicago, IL 60603
Re: Oak Street Health, Inc.
Amendment No. 1 to Draft Registration Statement on Form S-1
Submitted November 4, 2019
CIK No. 0001564406
Dear Mr. Pykosz:
We have reviewed your amended draft registration statement and have the
following
comments. In some of our comments, we may ask you to provide us with
information so we
may better understand your disclosure.
Please respond to this letter by providing the requested information and
either submitting
an amended draft registration statement or publicly filing your registration
statement on
EDGAR. If you do not believe our comments apply to your facts and circumstances
or do not
believe an amendment is appropriate, please tell us why in your response.
After reviewing the information you provide in response to these comments
and your
amended draft registration statement or filed registration statement, we may
have additional
comments.
Amendment No. 1 to Draft Registration Statement submitted November 4, 2019
Variable Interest Entities, page 99
1. We note your response to prior comment 24 and your revised disclosure on
page 99.
Please file your management services agreements with your affiliated
professional
organizations as exhibits to the registration statement or tell us why
you do not believe
they are required to be filed. See Item 601(b)(10) of Regulation S-K.
Mike Pykosz
FirstName LastNameMike Pykosz
Oak Street Health, Inc.
Comapany 22, 2019 Street Health, Inc.
November NameOak
Page 2
November 22, 2019 Page 2
FirstName LastName
Note 8 - Liability for Unpaid Claims, page F-62
2. The liability for unpaid claims rollforward table shows that the
current year incurred
health care costs are $226,724,000 and $125,206,000 in 2018 and 2017,
respectively.
Please revise to reconcile those amounts to the corresponding
third-party medical claims
expenses on page F-43 of $222,103,000 and $124,380,000 for 2018 and
2017,
respectively. Similarly, revise your interim financial statements to
address the
related differences therein.
Notes to Consolidated Financial Statements
Note 18 - Variable Interest Entities, page F-78
3. Please address the following regarding your response to prior comment
34:
Please revise to more clearly explain the specific differences
between the revenue and
operating expenses of the Physician Groups compared to your
consolidated revenues
and expenses on page F-43.
For example, explain the difference in the revenues of $313,473,000
and
$187,027,000 for 2018 and 2017, respectively on page F-79 compared
to Net
revenues of $317,938,000 and $184,980,000 for 2018 and 2017 per
page F-43.
Provide us with a quantified reconciliation.
Similarly, revise to explain the difference in the third party
medical claims and other
claims-related expenses of $220,887,000 and $125,951,000 for 2018
and 2017,
respectively on page F-79 compared to the third party medical
expenses on page F-
43 of $222,103,000 and $124,380,000 for 2018 and 2017. Provide us
with a
quantified reconciliation.
You state that you determined not to disclose the consolidated cost
of medical
services provided to your Physician Groups (excluding third-party
medical claims
expense) as a separate line item on the face of your Statements of
Operations because
you believe it would provide your competitors and payor partners
with competitively
sensitive information. Please tell us how you determined that
disclosure of your
internally incurred medical costs as representing a direct cost of
services provided
was not required by Article 5 of Regulation S-X.
Given your response, tell us more clearly what the nature of the
amounts reflected in
your line item titled "Provider salaries and benefits" on page
F-79. Tell us the
difference in the amounts presented in this line item and the
consolidated cost of
medical services provided internally.
Mike Pykosz
FirstName LastNameMike Pykosz
Oak Street Health, Inc.
Comapany 22, 2019 Street Health, Inc.
November NameOak
Page 3
November 22, 2019 Page 3
FirstName LastName
You may contact Andi Carpenter at 202-551-3645 or Kevin Vaughn at
202-551-3494 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Jeffrey Gabor at 202-551-2544 or Mary Beth Breslin at 202-551-3625 with
any other
questions.
Sincerely,
Division of
Corporation Finance
Office of Life
Sciences
cc: Robert E. Goedert, Esq.