ý
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ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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Delaware
Delaware
(State or Other Jurisdiction of
Incorporation or Organization)
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20-1764048
23-2872718
(I.R.S. Employer
Identification Number)
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4714 Gettysburg Road, P.O. Box 2034
Mechanicsburg, PA
(Address of Principal Executive Offices)
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17055
(Zip Code)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Select Medical Holdings Corporation,
Common Stock, $0.001 par value
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New York Stock Exchange
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Large accelerated filer ý
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Accelerated filer o
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Non-accelerated filer o
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Smaller reporting company o
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Emerging growth company o
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Large accelerated filer o
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Accelerated filer o
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Non-accelerated filer ý
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Smaller reporting company o
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Emerging growth company o
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•
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changes in government reimbursement for our services and/or new payment policies may result in a reduction in net operating revenues, an increase in costs, and a reduction in profitability;
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•
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the failure of our Medicare-certified long term care hospitals or inpatient rehabilitation facilities to maintain their Medicare certifications may cause our net operating revenues and profitability to decline;
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•
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the failure of our Medicare-certified long term care hospitals and inpatient rehabilitation facilities operated as “hospitals within hospitals” to qualify as hospitals separate from their host hospitals may cause our net operating revenues and profitability to decline;
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•
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a government investigation or assertion that we have violated applicable regulations may result in sanctions or reputational harm and increased costs;
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•
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acquisitions or joint ventures may prove difficult or unsuccessful, use significant resources, or expose us to unforeseen liabilities;
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•
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our plans and expectations related to our acquisitions, including the acquisition of U.S. HealthWorks by Concentra, and our ability to realize anticipated synergies;
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•
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private third-party payors for our services may adopt payment policies that could limit our future net operating revenues and profitability;
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•
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the failure to maintain established relationships with the physicians in the areas we serve could reduce our net operating revenues and profitability;
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•
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shortages in qualified nurses, therapists, physicians, or other licensed providers could increase our operating costs significantly or limit our ability to staff our facilities;
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•
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competition may limit our ability to grow and result in a decrease in our net operating revenues and profitability;
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•
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the loss of key members of our management team could significantly disrupt our operations;
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•
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the effect of claims asserted against us could subject us to substantial uninsured liabilities;
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•
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a security breach of our or our third-party vendors’ information technology systems may subject us to potential legal and reputational harm and may result in a violation of the Health Insurance Portability and Accountability Act of 1996 or the Health Information Technology for Economic and Clinical Health Act; and
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•
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other factors discussed from time to time in our filings with the Securities and Exchange Commission (the “SEC”), including factors discussed under the heading “Risk Factors” of this annual report on Form 10-K.
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•
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centralizing administrative functions such as accounting, finance, treasury, payroll, legal, operational support, human resources, compliance, and billing and collection;
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•
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standardizing management information systems to assist in capturing the medical record, accounting, billing, collections, and data capture and analysis; and
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•
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centralizing sourcing and contracting to receive discounted prices for pharmaceuticals, medical supplies, and other commodities used in our operations.
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•
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centralizing administrative functions such as accounting, finance, treasury, payroll, legal, operational support, human resources, compliance, and billing and collection;
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•
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standardizing management information systems to assist in capturing the medical record, accounting, billing, collections, and data capture and analysis; and
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•
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centralizing sourcing and contracting to receive discounted prices for pharmaceuticals, medical supplies, and other commodities used in our operations.
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Year Ended December 31,
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|||||||
Net Operating Revenues by Payor Source
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2016
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2017
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2018
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Medicare
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30.0
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%
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30.1
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%
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26.6
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%
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Commercial insurance(1)
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34.1
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%
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34.4
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%
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31.8
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%
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Workers’ Compensation
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17.1
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%
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17.2
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%
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22.1
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%
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Private and other(2)
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15.8
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%
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15.3
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%
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16.8
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%
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Medicaid
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3.0
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%
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3.0
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%
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2.7
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%
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Total
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100.0
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%
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100.0
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%
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100.0
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%
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(1)
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Primarily includes commercial healthcare insurance carriers, health maintenance organizations, preferred provider organizations, and managed care programs.
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(2)
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Primarily includes management services, employer services, self-payors, and non-patient related payments. Self-pay revenues represent less than 1% of total net operating revenues for all periods.
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Year Ended December 31,
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|||||||
Medicare Net Operating Revenues by Segment
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2016
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2017
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2018
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Critical illness recovery hospital
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53.3
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%
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52.4
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%
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50.9
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%
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Rehabilitation hospital
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38.4
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%
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41.6
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%
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41.5
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%
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Outpatient rehabilitation
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13.9
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%
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14.8
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%
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15.2
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%
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Concentra
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0.2
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%
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0.2
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%
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0.1
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%
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Total Company
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30.0
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%
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30.1
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%
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26.6
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%
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Name
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Age
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Position
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Robert A. Ortenzio
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61
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Executive Chairman and Co-Founder
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Rocco A. Ortenzio
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86
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Vice Chairman and Co-Founder
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David S. Chernow
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61
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President and Chief Executive Officer
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Martin F. Jackson
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64
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Executive Vice President and Chief Financial Officer
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John A. Saich
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50
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Executive Vice President and Chief Administrative Officer
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Michael E. Tarvin
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58
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Executive Vice President, General Counsel and Secretary
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Scott A. Romberger
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58
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Senior Vice President, Controller and Chief Accounting Officer
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Robert G. Breighner, Jr.
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49
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Vice President, Compliance and Audit Services and Corporate Compliance Officer
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•
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requires us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, reducing the availability of our cash flow to fund working capital, capital expenditures, development activity, acquisitions, and other general corporate purposes;
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•
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increases our vulnerability to adverse general economic or industry conditions;
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•
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limits our flexibility in planning for, or reacting to, changes in our business or the industries in which we operate;
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•
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makes us more vulnerable to increases in interest rates, as borrowings under our senior secured credit facilities are at variable rates;
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•
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limits our ability to obtain additional financing in the future for working capital or other purposes; and
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•
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places us at a competitive disadvantage compared to our competitors that have less indebtedness.
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Critical Illness Recovery Hospitals(1)
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Rehabilitation Hospitals(1)
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Outpatient
Rehabilitation Clinics(1)
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Concentra Occupational Health Centers(2)
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Total
Facilities
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|||||
Alabama
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1
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24
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25
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Alaska
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7
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5
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12
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Arizona
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2
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1
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40
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18
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61
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Arkansas
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2
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1
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2
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5
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|
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California
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1
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69
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97
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167
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|
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Colorado
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40
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23
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63
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Connecticut
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56
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10
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66
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Delaware
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1
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12
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|
|
1
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|
|
14
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District of Columbia
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4
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|
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|
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4
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Florida
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9
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|
|
1
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|
|
120
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|
|
33
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|
|
163
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Georgia
|
|
5
|
|
|
1
|
|
|
68
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|
|
17
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|
|
91
|
|
Hawaii
|
|
|
|
|
|
|
|
1
|
|
|
1
|
|
|||
Illinois
|
|
|
|
|
|
63
|
|
|
16
|
|
|
79
|
|
||
Indiana
|
|
3
|
|
|
|
|
29
|
|
|
14
|
|
|
46
|
|
|
Iowa
|
|
2
|
|
|
|
|
19
|
|
|
3
|
|
|
24
|
|
|
Kansas
|
|
2
|
|
|
|
|
14
|
|
|
4
|
|
|
20
|
|
|
Kentucky
|
|
2
|
|
|
|
|
58
|
|
|
9
|
|
|
69
|
|
|
Louisiana
|
|
|
|
1
|
|
|
3
|
|
|
3
|
|
|
7
|
|
|
Maine
|
|
|
|
|
|
16
|
|
|
7
|
|
|
23
|
|
||
Maryland
|
|
|
|
|
|
64
|
|
|
12
|
|
|
76
|
|
||
Massachusetts
|
|
|
|
|
|
12
|
|
|
2
|
|
|
14
|
|
||
Michigan
|
|
11
|
|
|
|
|
37
|
|
|
18
|
|
|
66
|
|
|
Minnesota
|
|
1
|
|
|
|
|
27
|
|
|
6
|
|
|
34
|
|
|
Mississippi
|
|
4
|
|
|
|
|
1
|
|
|
|
|
5
|
|
||
Missouri
|
|
4
|
|
|
3
|
|
|
92
|
|
|
17
|
|
|
116
|
|
Nebraska
|
|
2
|
|
|
|
|
2
|
|
|
3
|
|
|
7
|
|
|
Nevada
|
|
|
|
|
|
11
|
|
|
7
|
|
|
18
|
|
||
New Hampshire
|
|
|
|
|
|
|
|
3
|
|
|
3
|
|
|||
New Jersey
|
|
1
|
|
|
4
|
|
|
162
|
|
|
21
|
|
|
188
|
|
New Mexico
|
|
|
|
|
|
2
|
|
|
4
|
|
|
6
|
|
||
North Carolina
|
|
2
|
|
|
|
|
37
|
|
|
8
|
|
|
47
|
|
|
Ohio
|
|
16
|
|
|
5
|
|
|
86
|
|
|
17
|
|
|
124
|
|
Oklahoma
|
|
2
|
|
|
|
|
23
|
|
|
7
|
|
|
32
|
|
|
Oregon
|
|
|
|
|
|
|
|
4
|
|
|
4
|
|
|||
Pennsylvania
|
|
9
|
|
|
2
|
|
|
227
|
|
|
17
|
|
|
255
|
|
Rhode Island
|
|
|
|
|
|
|
|
2
|
|
|
2
|
|
South Carolina
|
|
2
|
|
|
|
|
26
|
|
|
3
|
|
|
31
|
|
|
South Dakota
|
|
1
|
|
|
|
|
|
|
|
|
1
|
|
|||
Tennessee
|
|
5
|
|
|
|
|
21
|
|
|
10
|
|
|
36
|
|
|
Texas
|
|
2
|
|
|
6
|
|
|
126
|
|
|
56
|
|
|
190
|
|
Utah
|
|
|
|
|
|
|
|
6
|
|
|
6
|
|
|||
Vermont
|
|
|
|
|
|
|
|
2
|
|
|
2
|
|
|||
Virginia
|
|
1
|
|
|
1
|
|
|
45
|
|
|
6
|
|
|
53
|
|
Washington
|
|
|
|
|
|
5
|
|
|
18
|
|
|
23
|
|
||
West Virginia
|
|
1
|
|
|
|
|
|
|
|
|
1
|
|
|||
Wisconsin
|
|
3
|
|
|
|
|
13
|
|
|
12
|
|
|
28
|
|
|
Total Company
|
|
96
|
|
|
26
|
|
|
1,662
|
|
|
524
|
|
|
2,308
|
|
(1)
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Includes managed critical illness recovery hospitals, rehabilitation hospitals, and outpatient rehabilitation clinics, respectively.
|
(2)
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Our Concentra segment also had operations in New York, West Virginia, and Wyoming.
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|
|
12/31/2013
|
|
12/31/2014
|
|
12/31/2015
|
|
12/31/2016
|
|
12/31/2017
|
|
12/31/2018
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||||||||||||
Select Medical Holdings Corporation (SEM)
|
|
$
|
100.00
|
|
|
$
|
127.71
|
|
|
$
|
106.43
|
|
|
$
|
118.40
|
|
|
$
|
157.72
|
|
|
$
|
137.17
|
|
S&P Health Care Services Select Industry Index (SPSIHP)
|
|
$
|
100.00
|
|
|
$
|
125.01
|
|
|
$
|
128.86
|
|
|
$
|
117.98
|
|
|
$
|
137.90
|
|
|
$
|
141.15
|
|
S&P 500
|
|
$
|
100.00
|
|
|
$
|
111.36
|
|
|
$
|
110.53
|
|
|
$
|
121.09
|
|
|
$
|
144.61
|
|
|
$
|
135.59
|
|
|
|
Total Number of
Shares Purchased
|
|
Average Price
Paid Per Share
|
|
Total Number of
Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Approximate Dollar Value of Shares that
May Yet Be Purchased Under Plans or Programs
|
|
||||||
October 1 - October 31, 2018
|
|
72,206
|
|
|
$
|
16.58
|
|
|
—
|
|
|
$
|
185,249,048
|
|
|
November 1 - November 30, 2018
|
|
—
|
|
|
—
|
|
|
—
|
|
|
185,249,048
|
|
|
||
December 1 - December 31, 2018
|
|
—
|
|
|
—
|
|
|
—
|
|
|
185,249,048
|
|
|
||
Total
|
|
72,206
|
|
|
$
|
16.58
|
|
|
—
|
|
|
$
|
185,249,048
|
|
|
|
|
Select Medical Holdings Corporation
|
||||||||||||||||||
|
|
For the Year Ended December 31,
|
||||||||||||||||||
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
||||||||||
|
|
(In thousands, except per share data)
|
||||||||||||||||||
Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net operating revenues(1)
|
|
$
|
3,065,017
|
|
|
$
|
3,742,736
|
|
|
$
|
4,217,460
|
|
|
$
|
4,365,245
|
|
|
$
|
5,081,258
|
|
Operating expenses(2)
|
|
2,712,187
|
|
|
3,362,965
|
|
|
3,772,302
|
|
|
3,849,356
|
|
|
4,462,324
|
|
|||||
Depreciation and amortization
|
|
68,354
|
|
|
104,981
|
|
|
145,311
|
|
|
160,011
|
|
|
201,655
|
|
|||||
Income from operations
|
|
284,476
|
|
|
274,790
|
|
|
299,847
|
|
|
355,878
|
|
|
417,279
|
|
|||||
Loss on early retirement of debt(3)
|
|
(2,277
|
)
|
|
—
|
|
|
(11,626
|
)
|
|
(19,719
|
)
|
|
(14,155
|
)
|
|||||
Equity in earnings of unconsolidated subsidiaries
|
|
7,044
|
|
|
16,811
|
|
|
19,943
|
|
|
21,054
|
|
|
21,905
|
|
|||||
Non-operating gain (loss)
|
|
—
|
|
|
29,647
|
|
|
42,651
|
|
|
(49
|
)
|
|
9,016
|
|
|||||
Interest expense
|
|
(85,446
|
)
|
|
(112,816
|
)
|
|
(170,081
|
)
|
|
(154,703
|
)
|
|
(198,493
|
)
|
|||||
Income before income taxes
|
|
203,797
|
|
|
208,432
|
|
|
180,734
|
|
|
202,461
|
|
|
235,552
|
|
|||||
Income tax expense (benefit)
|
|
75,622
|
|
|
72,436
|
|
|
55,464
|
|
|
(18,184
|
)
|
|
58,610
|
|
|||||
Net income
|
|
128,175
|
|
|
135,996
|
|
|
125,270
|
|
|
220,645
|
|
|
176,942
|
|
|||||
Less: Net income attributable to non-controlling interests(4)
|
|
7,548
|
|
|
5,260
|
|
|
9,859
|
|
|
43,461
|
|
|
39,102
|
|
|||||
Net income attributable to Select Medical Holdings Corporation
|
|
$
|
120,627
|
|
|
$
|
130,736
|
|
|
$
|
115,411
|
|
|
$
|
177,184
|
|
|
$
|
137,840
|
|
Earnings per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
$
|
0.91
|
|
|
$
|
1.00
|
|
|
$
|
0.88
|
|
|
$
|
1.33
|
|
|
$
|
1.02
|
|
Diluted
|
|
$
|
0.91
|
|
|
$
|
0.99
|
|
|
$
|
0.87
|
|
|
$
|
1.33
|
|
|
$
|
1.02
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
129,026
|
|
|
127,478
|
|
|
127,813
|
|
|
128,955
|
|
|
130,172
|
|
|||||
Diluted
|
|
129,465
|
|
|
127,752
|
|
|
127,968
|
|
|
129,126
|
|
|
130,256
|
|
|||||
Dividends per share
|
|
$
|
0.40
|
|
|
$
|
0.10
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Balance Sheet Data (at end of period):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
|
$
|
3,354
|
|
|
$
|
14,435
|
|
|
$
|
99,029
|
|
|
$
|
122,549
|
|
|
$
|
175,178
|
|
Working capital(5)(6)
|
|
133,220
|
|
|
19,869
|
|
|
191,268
|
|
|
315,423
|
|
|
287,338
|
|
|||||
Total assets(5)(6)
|
|
2,924,809
|
|
|
4,388,678
|
|
|
4,920,626
|
|
|
5,127,166
|
|
|
5,964,265
|
|
|||||
Total debt(5)
|
|
1,552,976
|
|
|
2,385,896
|
|
|
2,698,989
|
|
|
2,699,902
|
|
|
3,293,381
|
|
|||||
Redeemable non-controlling interests
|
|
10,985
|
|
|
238,221
|
|
|
422,159
|
|
|
640,818
|
|
|
780,488
|
|
|||||
Total Select Medical Holdings Corporation stockholders’ equity
|
|
739,515
|
|
|
859,253
|
|
|
815,725
|
|
|
823,368
|
|
|
803,042
|
|
|
|
Select Medical Corporation
|
||||||||||||||||||
|
|
For the Year Ended December 31,
|
||||||||||||||||||
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
||||||||||
|
|
(In thousands)
|
||||||||||||||||||
Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net operating revenues(1)
|
|
$
|
3,065,017
|
|
|
$
|
3,742,736
|
|
|
$
|
4,217,460
|
|
|
$
|
4,365,245
|
|
|
$
|
5,081,258
|
|
Operating expenses(2)
|
|
2,712,187
|
|
|
3,362,965
|
|
|
3,772,302
|
|
|
3,849,356
|
|
|
4,462,324
|
|
|||||
Depreciation and amortization
|
|
68,354
|
|
|
104,981
|
|
|
145,311
|
|
|
160,011
|
|
|
201,655
|
|
|||||
Income from operations
|
|
284,476
|
|
|
274,790
|
|
|
299,847
|
|
|
355,878
|
|
|
417,279
|
|
|||||
Loss on early retirement of debt(3)
|
|
(2,277
|
)
|
|
—
|
|
|
(11,626
|
)
|
|
(19,719
|
)
|
|
(14,155
|
)
|
|||||
Equity in earnings of unconsolidated subsidiaries
|
|
7,044
|
|
|
16,811
|
|
|
19,943
|
|
|
21,054
|
|
|
21,905
|
|
|||||
Non-operating gain (loss)
|
|
—
|
|
|
29,647
|
|
|
42,651
|
|
|
(49
|
)
|
|
9,016
|
|
|||||
Interest expense
|
|
(85,446
|
)
|
|
(112,816
|
)
|
|
(170,081
|
)
|
|
(154,703
|
)
|
|
(198,493
|
)
|
|||||
Income before income taxes
|
|
203,797
|
|
|
208,432
|
|
|
180,734
|
|
|
202,461
|
|
|
235,552
|
|
|||||
Income tax expense (benefit)
|
|
75,622
|
|
|
72,436
|
|
|
55,464
|
|
|
(18,184
|
)
|
|
58,610
|
|
|||||
Net income
|
|
128,175
|
|
|
135,996
|
|
|
125,270
|
|
|
220,645
|
|
|
176,942
|
|
|||||
Less: Net income attributable to non-controlling interests(4)
|
|
7,548
|
|
|
5,260
|
|
|
9,859
|
|
|
43,461
|
|
|
39,102
|
|
|||||
Net income attributable to Select Medical Corporation
|
|
$
|
120,627
|
|
|
$
|
130,736
|
|
|
$
|
115,411
|
|
|
$
|
177,184
|
|
|
$
|
137,840
|
|
Balance Sheet Data (at end of period):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
|
$
|
3,354
|
|
|
$
|
14,435
|
|
|
$
|
99,029
|
|
|
$
|
122,549
|
|
|
$
|
175,178
|
|
Working capital(5)(6)
|
|
133,220
|
|
|
19,869
|
|
|
191,268
|
|
|
315,423
|
|
|
287,338
|
|
|||||
Total assets(5)(6)
|
|
2,924,809
|
|
|
4,388,678
|
|
|
4,920,626
|
|
|
5,127,166
|
|
|
5,964,265
|
|
|||||
Total debt(5)
|
|
1,552,976
|
|
|
2,385,896
|
|
|
2,698,989
|
|
|
2,699,902
|
|
|
3,293,381
|
|
|||||
Redeemable non-controlling interests
|
|
10,985
|
|
|
238,221
|
|
|
422,159
|
|
|
640,818
|
|
|
780,488
|
|
|||||
Total Select Medical Corporation stockholders’ equity
|
|
739,515
|
|
|
859,253
|
|
|
815,725
|
|
|
823,368
|
|
|
803,042
|
|
(1)
|
For the years ended December 31, 2016, 2017, and 2018, net operating revenues reflect the adoption of Topic 606, Revenue from Contracts with Customers. Net operating revenues were not retrospectively conformed for the years ended December 31, 2014 and 2015.
|
(2)
|
Operating expenses include cost of services, general and administrative expenses, bad debt expenses, and stock compensation expense.
|
(3)
|
During the year ended December 31, 2014, the Company refinanced the term loans under Select’s 2011 senior secured credit facility. A loss on early retirement of debt of $2.3 million was recognized for unamortized debt issuance costs, unamortized original issue discount, and certain fees incurred in connection with the term loan modifications.
|
(4)
|
Reflects interests held by other parties in subsidiaries, limited liability companies and limited partnerships owned and controlled by us.
|
(5)
|
As of December 31, 2015, 2016, 2017, and 2018, the balance sheet data reflects the adoption of ASU 2015-03 and ASU 2015-15, Interest—Imputation of Interest, which requires unamortized debt issuance costs to be reflected as a direct reduction of debt, rather than as a component of other assets. The balance sheet data was not retrospectively conformed as of December 31, 2014.
|
(6)
|
As of December 31, 2016, 2017, and 2018, the balance sheet data reflects the adoption of ASU 2015-17, Balance Sheet Classification of Deferred Taxes, which requires all deferred tax liabilities and assets be classified as non-current. The balance sheet data was not retrospectively conformed as of December 31, 2014 and 2015.
|
|
|
Select Medical Holdings Corporation
|
|
||||||||||||||||||
|
|
For the Year Ended December 31,
|
|
||||||||||||||||||
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
||||||||||
|
|
(In thousands)
|
|
||||||||||||||||||
Net income
|
|
$
|
128,175
|
|
|
$
|
135,996
|
|
|
$
|
125,270
|
|
|
$
|
220,645
|
|
|
$
|
176,942
|
|
|
Income tax expense (benefit)
|
|
75,622
|
|
|
72,436
|
|
|
55,464
|
|
|
(18,184
|
)
|
|
58,610
|
|
|
|||||
Interest expense
|
|
85,446
|
|
|
112,816
|
|
|
170,081
|
|
|
154,703
|
|
|
198,493
|
|
|
|||||
Non-operating loss (gain)
|
|
—
|
|
|
(29,647
|
)
|
|
(42,651
|
)
|
|
49
|
|
|
(9,016
|
)
|
|
|||||
Equity in earnings of unconsolidated subsidiaries
|
|
(7,044
|
)
|
|
(16,811
|
)
|
|
(19,943
|
)
|
|
(21,054
|
)
|
|
(21,905
|
)
|
|
|||||
Loss on early retirement of debt
|
|
2,277
|
|
|
—
|
|
|
11,626
|
|
|
19,719
|
|
|
14,155
|
|
|
|||||
Income from operations
|
|
284,476
|
|
|
274,790
|
|
|
299,847
|
|
|
355,878
|
|
|
417,279
|
|
|
|||||
Stock compensation expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Included in general and administrative
|
|
9,027
|
|
|
11,633
|
|
|
14,607
|
|
|
15,706
|
|
|
17,604
|
|
|
|||||
Included in cost of services
|
|
2,015
|
|
|
3,046
|
|
|
2,806
|
|
|
3,578
|
|
|
5,722
|
|
|
|||||
Depreciation and amortization
|
|
68,354
|
|
|
104,981
|
|
|
145,311
|
|
|
160,011
|
|
|
201,655
|
|
|
|||||
Concentra acquisition costs
|
|
—
|
|
|
4,715
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||||
Physiotherapy acquisition costs
|
|
—
|
|
|
—
|
|
|
3,236
|
|
|
—
|
|
|
—
|
|
|
|||||
U.S. HealthWorks acquisition costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,819
|
|
|
2,895
|
|
|
|||||
Adjusted EBITDA
|
|
$
|
363,872
|
|
|
$
|
399,165
|
|
|
$
|
465,807
|
|
|
$
|
537,992
|
|
|
$
|
645,155
|
|
|
|
For the Year Ended December 31, 2018
|
||||||||||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
|
Other
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Net operating revenues
|
$
|
1,753,584
|
|
|
$
|
707,514
|
|
|
$
|
1,062,487
|
|
|
$
|
1,557,673
|
|
|
$
|
—
|
|
|
$
|
5,081,258
|
|
Operating expenses
|
1,510,569
|
|
|
598,587
|
|
|
920,482
|
|
|
1,311,474
|
|
|
121,212
|
|
|
4,462,324
|
|
||||||
Depreciation and amortization
|
45,797
|
|
|
24,101
|
|
|
27,195
|
|
|
95,521
|
|
|
9,041
|
|
|
201,655
|
|
||||||
Income from operations
|
197,218
|
|
|
84,826
|
|
|
114,810
|
|
|
150,678
|
|
|
(130,253
|
)
|
|
417,279
|
|
||||||
Depreciation and amortization
|
45,797
|
|
|
24,101
|
|
|
27,195
|
|
|
95,521
|
|
|
9,041
|
|
|
201,655
|
|
||||||
Stock compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
2,883
|
|
|
20,443
|
|
|
23,326
|
|
||||||
U.S. HealthWorks acquisition costs
|
—
|
|
|
—
|
|
|
—
|
|
|
2,895
|
|
|
—
|
|
|
2,895
|
|
||||||
Adjusted EBITDA
|
$
|
243,015
|
|
|
$
|
108,927
|
|
|
$
|
142,005
|
|
|
$
|
251,977
|
|
|
$
|
(100,769
|
)
|
|
$
|
645,155
|
|
Adjusted EBITDA margin
|
13.9
|
%
|
|
15.4
|
%
|
|
13.4
|
%
|
|
16.2
|
%
|
|
N/M
|
|
|
12.7
|
%
|
|
For the Year Ended December 31, 2017
|
||||||||||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
|
Other
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Net operating revenues
|
$
|
1,725,022
|
|
|
$
|
622,469
|
|
|
$
|
1,003,830
|
|
|
$
|
1,013,224
|
|
|
$
|
700
|
|
|
$
|
4,365,245
|
|
Operating expenses
|
1,472,343
|
|
|
532,428
|
|
|
871,297
|
|
|
859,475
|
|
|
113,813
|
|
|
3,849,356
|
|
||||||
Depreciation and amortization
|
45,743
|
|
|
20,176
|
|
|
24,607
|
|
|
61,945
|
|
|
7,540
|
|
|
160,011
|
|
||||||
Income from operations
|
206,936
|
|
|
69,865
|
|
|
107,926
|
|
|
91,804
|
|
|
(120,653
|
)
|
|
355,878
|
|
||||||
Depreciation and amortization
|
45,743
|
|
|
20,176
|
|
|
24,607
|
|
|
61,945
|
|
|
7,540
|
|
|
160,011
|
|
||||||
Stock compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
993
|
|
|
18,291
|
|
|
19,284
|
|
||||||
U.S. HealthWorks acquisition costs
|
—
|
|
|
—
|
|
|
—
|
|
|
2,819
|
|
|
—
|
|
|
2,819
|
|
||||||
Adjusted EBITDA
|
$
|
252,679
|
|
|
$
|
90,041
|
|
|
$
|
132,533
|
|
|
$
|
157,561
|
|
|
$
|
(94,822
|
)
|
|
$
|
537,992
|
|
Adjusted EBITDA margin
|
14.6
|
%
|
|
14.5
|
%
|
|
13.2
|
%
|
|
15.6
|
%
|
|
N/M
|
|
|
12.3
|
%
|
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
|
Other
|
|
Total
|
||||||
Change in net operating revenues
|
1.7
|
%
|
|
13.7
|
%
|
|
5.8
|
%
|
|
53.7
|
%
|
|
N/M
|
|
|
16.4
|
%
|
Change in income from operations
|
(4.7
|
)%
|
|
21.4
|
%
|
|
6.4
|
%
|
|
64.1
|
%
|
|
(8.0
|
)%
|
|
17.3
|
%
|
Change in Adjusted EBITDA
|
(3.8
|
)%
|
|
21.0
|
%
|
|
7.1
|
%
|
|
59.9
|
%
|
|
(6.3
|
)%
|
|
19.9
|
%
|
|
For the Year Ended December 31, 2017
|
||||||||||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
|
Other
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Net operating revenues
|
$
|
1,725,022
|
|
|
$
|
622,469
|
|
|
$
|
1,003,830
|
|
|
$
|
1,013,224
|
|
|
$
|
700
|
|
|
$
|
4,365,245
|
|
Operating expenses
|
1,472,343
|
|
|
532,428
|
|
|
871,297
|
|
|
859,475
|
|
|
113,813
|
|
|
3,849,356
|
|
||||||
Depreciation and amortization
|
45,743
|
|
|
20,176
|
|
|
24,607
|
|
|
61,945
|
|
|
7,540
|
|
|
160,011
|
|
||||||
Income from operations
|
206,936
|
|
|
69,865
|
|
|
107,926
|
|
|
91,804
|
|
|
(120,653
|
)
|
|
355,878
|
|
||||||
Depreciation and amortization
|
45,743
|
|
|
20,176
|
|
|
24,607
|
|
|
61,945
|
|
|
7,540
|
|
|
160,011
|
|
||||||
Stock compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
993
|
|
|
18,291
|
|
|
19,284
|
|
||||||
U.S. HealthWorks acquisition costs
|
—
|
|
|
—
|
|
|
—
|
|
|
2,819
|
|
|
—
|
|
|
2,819
|
|
||||||
Adjusted EBITDA
|
$
|
252,679
|
|
|
$
|
90,041
|
|
|
$
|
132,533
|
|
|
$
|
157,561
|
|
|
$
|
(94,822
|
)
|
|
$
|
537,992
|
|
Adjusted EBITDA margin
|
14.6
|
%
|
|
14.5
|
%
|
|
13.2
|
%
|
|
15.6
|
%
|
|
N/M
|
|
|
12.3
|
%
|
|
For the Year Ended December 31, 2016
|
||||||||||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
|
Other
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Net operating revenues
|
$
|
1,756,961
|
|
|
$
|
498,100
|
|
|
$
|
979,363
|
|
|
$
|
982,495
|
|
|
$
|
541
|
|
|
$
|
4,217,460
|
|
Operating expenses
|
1,532,352
|
|
|
441,198
|
|
|
849,533
|
|
|
840,256
|
|
|
108,963
|
|
|
3,772,302
|
|
||||||
Depreciation and amortization
|
43,862
|
|
|
12,723
|
|
|
22,661
|
|
|
60,717
|
|
|
5,348
|
|
|
145,311
|
|
||||||
Income from operations
|
180,747
|
|
|
44,179
|
|
|
107,169
|
|
|
81,522
|
|
|
(113,770
|
)
|
|
299,847
|
|
||||||
Depreciation and amortization
|
43,862
|
|
|
12,723
|
|
|
22,661
|
|
|
60,717
|
|
|
5,348
|
|
|
145,311
|
|
||||||
Stock compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
770
|
|
|
16,643
|
|
|
17,413
|
|
||||||
Physiotherapy acquisition costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,236
|
|
|
3,236
|
|
||||||
Adjusted EBITDA
|
$
|
224,609
|
|
|
$
|
56,902
|
|
|
$
|
129,830
|
|
|
$
|
143,009
|
|
|
$
|
(88,543
|
)
|
|
$
|
465,807
|
|
Adjusted EBITDA margin
|
12.8
|
%
|
|
11.4
|
%
|
|
13.3
|
%
|
|
14.6
|
%
|
|
N/M
|
|
|
11.0
|
%
|
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
|
Other
|
|
Total
|
||||||
Change in net operating revenues
|
(1.8
|
)%
|
|
25.0
|
%
|
|
2.5
|
%
|
|
3.1
|
%
|
|
N/M
|
|
|
3.5
|
%
|
Change in income from operations
|
14.5
|
%
|
|
58.1
|
%
|
|
0.7
|
%
|
|
12.6
|
%
|
|
(6.0
|
)%
|
|
18.7
|
%
|
Change in Adjusted EBITDA
|
12.5
|
%
|
|
58.2
|
%
|
|
2.1
|
%
|
|
10.2
|
%
|
|
(7.1
|
)%
|
|
15.5
|
%
|
|
|
December 31, 2017
|
|
|
December 31, 2018
|
|
||||||||||||||||||||||||||||
|
|
0 - 90
Days
|
|
91 - 180 Days
|
|
181 - 365 Days
|
|
Over 365
Days |
|
|
0 - 90
Days
|
|
91 - 180 Days
|
|
181 - 365 Days
|
|
Over 365
Days |
|
||||||||||||||||
Commercial insurance and other
|
|
$
|
350,563
|
|
|
$
|
47,395
|
|
|
$
|
38,601
|
|
|
$
|
28,079
|
|
|
|
$
|
409,521
|
|
|
$
|
62,956
|
|
|
$
|
45,811
|
|
|
$
|
33,662
|
|
|
Medicare and Medicaid
|
|
208,234
|
|
|
7,985
|
|
|
5,225
|
|
|
5,650
|
|
|
|
137,771
|
|
|
7,217
|
|
|
4,885
|
|
|
4,853
|
|
|
||||||||
Total accounts receivable
|
|
$
|
558,797
|
|
|
$
|
55,380
|
|
|
$
|
43,826
|
|
|
$
|
33,729
|
|
|
|
$
|
547,292
|
|
|
$
|
70,173
|
|
|
$
|
50,696
|
|
|
$
|
38,515
|
|
|
|
|
December 31,
|
|
||||
|
|
2017
|
|
2018
|
|
||
Commercial insurance and other
|
|
66.9
|
%
|
|
77.8
|
%
|
|
Medicare and Medicaid
|
|
32.8
|
%
|
|
21.9
|
%
|
|
Self-pay receivables (including deductibles and co-payments)
|
|
0.3
|
%
|
|
0.3
|
%
|
|
Total
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
For the Year Ended December 31,
|
|
||||||||||
|
|
2016
|
|
2017
|
|
2018
|
|
||||||
Critical illness recovery hospital data:(1)
|
|
|
|
|
|
|
|
|
|
|
|||
Number of hospitals owned—start of period
|
|
108
|
|
|
102
|
|
|
99
|
|
|
|||
Number of hospitals acquired
|
|
4
|
|
|
1
|
|
|
—
|
|
|
|||
Number of hospital start-ups
|
|
—
|
|
|
1
|
|
|
1
|
|
|
|||
Number of hospitals closed/sold
|
|
(10
|
)
|
|
(5
|
)
|
|
(4
|
)
|
|
|||
Number of hospitals owned—end of period
|
|
102
|
|
|
99
|
|
|
96
|
|
|
|||
Number of hospitals managed—end of period
|
|
1
|
|
|
1
|
|
|
—
|
|
|
|||
Total number of hospitals (all)—end of period
|
|
103
|
|
|
100
|
|
|
96
|
|
|
|||
Available licensed beds(2)
|
|
4,254
|
|
|
4,159
|
|
|
4,071
|
|
|
|||
Admissions(2)
|
|
36,859
|
|
|
35,793
|
|
|
36,474
|
|
|
|||
Patient days(2)
|
|
1,041,074
|
|
|
1,003,161
|
|
|
1,012,368
|
|
|
|||
Average length of stay (days)(2)
|
|
28
|
|
|
28
|
|
|
28
|
|
|
|||
Net revenue per patient day(2)(3)(5)
|
|
$
|
1,663
|
|
|
$
|
1,704
|
|
|
$
|
1,716
|
|
|
Occupancy rate(2)
|
|
65
|
%
|
|
66
|
%
|
|
67
|
%
|
|
|||
Percent patient days—Medicare(2)
|
|
55
|
%
|
|
54
|
%
|
|
53
|
%
|
|
|||
Rehabilitation hospital data:(1)
|
|
|
|
|
|
|
|
||||||
Number of facilities owned—start of period
|
|
10
|
|
|
13
|
|
|
16
|
|
|
|||
Number of facilities acquired
|
|
1
|
|
|
—
|
|
|
—
|
|
|
|||
Number of facilities start-ups
|
|
2
|
|
|
3
|
|
|
1
|
|
|
|||
Number of facilities closed/sold
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||
Number of facilities owned—end of period
|
|
13
|
|
|
16
|
|
|
17
|
|
|
|||
Number of facilities managed—end of period
|
|
7
|
|
|
8
|
|
|
9
|
|
|
|||
Total number of facilities (all)—end of period
|
|
20
|
|
|
24
|
|
|
26
|
|
|
|||
Available licensed beds(2)
|
|
983
|
|
|
1,133
|
|
|
1,189
|
|
|
|||
Admissions(2)
|
|
14,670
|
|
|
18,841
|
|
|
21,813
|
|
|
|||
Patient days(2)
|
|
216,994
|
|
|
269,905
|
|
|
315,468
|
|
|
|||
Average length of stay (days)(2)
|
|
15
|
|
|
14
|
|
|
14
|
|
|
|||
Net revenue per patient day(2)(3)(5)
|
|
$
|
1,441
|
|
|
$
|
1,577
|
|
|
$
|
1,606
|
|
|
Occupancy rate(2)
|
|
71
|
%
|
|
72
|
%
|
|
74
|
%
|
|
|||
Percent patient days—Medicare(2)
|
|
53
|
%
|
|
54
|
%
|
|
54
|
%
|
|
|||
Outpatient rehabilitation data:
|
|
|
|
|
|
|
|
|
|
|
|||
Number of clinics owned—start of period
|
|
896
|
|
|
1,445
|
|
|
1,447
|
|
|
|||
Number of clinics acquired
|
|
559
|
|
|
13
|
|
|
20
|
|
|
|||
Number of clinic start-ups
|
|
28
|
|
|
28
|
|
|
34
|
|
|
|||
Number of clinics closed/sold
|
|
(38
|
)
|
|
(39
|
)
|
|
(78
|
)
|
|
|||
Number of clinics owned—end of period
|
|
1,445
|
|
|
1,447
|
|
|
1,423
|
|
|
|||
Number of clinics managed—end of period
|
|
166
|
|
|
169
|
|
|
239
|
|
|
|||
Total number of clinics (all)—end of period
|
|
1,611
|
|
|
1,616
|
|
|
1,662
|
|
|
|||
Number of visits(2)
|
|
7,799,208
|
|
|
8,232,536
|
|
|
8,356,018
|
|
|
|||
Net revenue per visit(2)(4)(5)
|
|
$
|
100
|
|
|
$
|
101
|
|
|
$
|
103
|
|
|
|
|
For the Year Ended December 31,
|
|
||||||||||
|
|
2016
|
|
2017
|
|
2018
|
|
||||||
Concentra data:
|
|
|
|
|
|
|
|
|
|
|
|||
Number of centers owned—start of period
|
|
300
|
|
|
300
|
|
|
312
|
|
|
|||
Number of centers acquired
|
|
4
|
|
|
11
|
|
|
221
|
|
|
|||
Number of center start-ups
|
|
—
|
|
|
4
|
|
|
—
|
|
|
|||
Number of centers closed/sold
|
|
(4
|
)
|
|
(3
|
)
|
|
(9
|
)
|
|
|||
Number of centers owned—end of period
|
|
300
|
|
|
312
|
|
|
524
|
|
|
|||
Number of visits(2)
|
|
7,373,751
|
|
|
7,709,508
|
|
|
11,426,940
|
|
|
|||
Net revenue per visit(2)(4)(5)
|
|
$
|
116
|
|
|
$
|
115
|
|
|
$
|
124
|
|
|
(1)
|
The critical illness recovery hospital segment was previously referred to as the long term acute care segment. The rehabilitation hospital segment was previously referred to as the inpatient rehabilitation segment.
|
(2)
|
Data excludes locations managed by the Company. For purposes of our Concentra segment, onsite clinics and community-based outpatient clinics are excluded.
|
(3)
|
Net revenue per patient day is calculated by dividing direct patient service revenues by the total number of patient days.
|
(4)
|
Net revenue per visit is calculated by dividing direct patient service revenue by the total number of visits. For purposes of this computation for our Concentra segment, direct patient service revenue does not include onsite clinics and community-based outpatient clinics.
|
(5)
|
Net revenue per patient day and net revenue per visit were retrospectively conformed to reflect the impact of Topic 606, Revenue from Contracts with Customers.
|
|
|
For the Year Ended December 31,
|
|
|||||||
|
|
2016
|
|
2017
|
|
2018
|
|
|||
Net operating revenues
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Cost of services(1)
|
|
86.9
|
|
|
85.6
|
|
|
85.4
|
|
|
General and administrative
|
|
2.5
|
|
|
2.6
|
|
|
2.4
|
|
|
Depreciation and amortization
|
|
3.5
|
|
|
3.6
|
|
|
4.0
|
|
|
Income from operations
|
|
7.1
|
|
|
8.2
|
|
|
8.2
|
|
|
Loss on early retirement of debt
|
|
(0.3
|
)
|
|
(0.5
|
)
|
|
(0.3
|
)
|
|
Equity in earnings of unconsolidated subsidiaries
|
|
0.5
|
|
|
0.5
|
|
|
0.4
|
|
|
Non-operating gain (loss)
|
|
1.0
|
|
|
(0.0
|
)
|
|
0.2
|
|
|
Interest expense
|
|
(4.0
|
)
|
|
(3.6
|
)
|
|
(3.9
|
)
|
|
Income before income taxes
|
|
4.3
|
|
|
4.6
|
|
|
4.6
|
|
|
Income tax expense (benefit)
|
|
1.3
|
|
|
(0.5
|
)
|
|
1.1
|
|
|
Net income
|
|
3.0
|
|
|
5.1
|
|
|
3.5
|
|
|
Net income attributable to non-controlling interests
|
|
0.3
|
|
|
1.0
|
|
|
0.8
|
|
|
Net income attributable to Holdings and Select
|
|
2.7
|
%
|
|
4.1
|
%
|
|
2.7
|
%
|
|
(1)
|
Cost of services includes salaries, wages and benefits, operating supplies, lease and rent expense, and other operating costs.
|
|
|
Year Ended December 31,
|
|
|
|
|
|
||||||||||||
|
|
2016
|
|
2017
|
|
2018
|
|
% Change
2016 - 2017
|
|
% Change
2017 - 2018
|
|
||||||||
Net operating revenues:(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Critical illness recovery hospital(2)
|
|
$
|
1,756,961
|
|
|
$
|
1,725,022
|
|
|
$
|
1,753,584
|
|
|
(1.8
|
)%
|
|
1.7
|
%
|
|
Rehabilitation hospital(2)
|
|
498,100
|
|
|
622,469
|
|
|
707,514
|
|
|
25.0
|
|
|
13.7
|
|
|
|||
Outpatient rehabilitation(3)
|
|
979,363
|
|
|
1,003,830
|
|
|
1,062,487
|
|
|
2.5
|
|
|
5.8
|
|
|
|||
Concentra(4)
|
|
982,495
|
|
|
1,013,224
|
|
|
1,557,673
|
|
|
3.1
|
|
|
53.7
|
|
|
|||
Other(5)
|
|
541
|
|
|
700
|
|
|
—
|
|
|
N/M
|
|
|
N/M
|
|
|
|||
Total Company
|
|
$
|
4,217,460
|
|
|
$
|
4,365,245
|
|
|
$
|
5,081,258
|
|
|
3.5
|
%
|
|
16.4
|
%
|
|
Income (loss) from operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Critical illness recovery hospital(2)
|
|
$
|
180,747
|
|
|
$
|
206,936
|
|
|
$
|
197,218
|
|
|
14.5
|
%
|
|
(4.7
|
)%
|
|
Rehabilitation hospital(2)
|
|
44,179
|
|
|
69,865
|
|
|
84,826
|
|
|
58.1
|
|
|
21.4
|
|
|
|||
Outpatient rehabilitation(3)
|
|
107,169
|
|
|
107,926
|
|
|
114,810
|
|
|
0.7
|
|
|
6.4
|
|
|
|||
Concentra(4)
|
|
81,522
|
|
|
91,804
|
|
|
150,678
|
|
|
12.6
|
|
|
64.1
|
|
|
|||
Other(5)
|
|
(113,770
|
)
|
|
(120,653
|
)
|
|
(130,253
|
)
|
|
(6.0
|
)
|
|
(8.0
|
)
|
|
|||
Total Company
|
|
$
|
299,847
|
|
|
$
|
355,878
|
|
|
$
|
417,279
|
|
|
18.7
|
%
|
|
17.3
|
%
|
|
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Critical illness recovery hospital(2)
|
|
$
|
224,609
|
|
|
$
|
252,679
|
|
|
$
|
243,015
|
|
|
12.5
|
%
|
|
(3.8
|
)%
|
|
Rehabilitation hospital(2)
|
|
56,902
|
|
|
90,041
|
|
|
108,927
|
|
|
58.2
|
|
|
21.0
|
|
|
|||
Outpatient rehabilitation(3)
|
|
129,830
|
|
|
132,533
|
|
|
142,005
|
|
|
2.1
|
|
|
7.1
|
|
|
|||
Concentra(4)
|
|
143,009
|
|
|
157,561
|
|
|
251,977
|
|
|
10.2
|
|
|
59.9
|
|
|
|||
Other(5)
|
|
(88,543
|
)
|
|
(94,822
|
)
|
|
(100,769
|
)
|
|
(7.1
|
)
|
|
(6.3
|
)
|
|
|||
Total Company
|
|
$
|
465,807
|
|
|
$
|
537,992
|
|
|
$
|
645,155
|
|
|
15.5
|
%
|
|
19.9
|
%
|
|
Adjusted EBITDA margins:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Critical illness recovery hospital(2)
|
|
12.8
|
%
|
|
14.6
|
%
|
|
13.9
|
%
|
|
|
|
|
|
|||||
Rehabilitation hospital(2)
|
|
11.4
|
|
|
14.5
|
|
|
15.4
|
|
|
|
|
|
|
|
|
|||
Outpatient rehabilitation(3)
|
|
13.3
|
|
|
13.2
|
|
|
13.4
|
|
|
|
|
|
|
|
|
|||
Concentra(4)
|
|
14.6
|
|
|
15.6
|
|
|
16.2
|
|
|
|
|
|
|
|
|
|||
Other(5)
|
|
N/M
|
|
|
N/M
|
|
|
N/M
|
|
|
|
|
|
|
|
|
|||
Total Company
|
|
11.0
|
%
|
|
12.3
|
%
|
|
12.7
|
%
|
|
|
|
|
|
|
|
|||
Total assets:(6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Critical illness recovery hospital(2)
|
|
$
|
1,910,013
|
|
|
$
|
1,848,783
|
|
|
$
|
1,771,605
|
|
|
|
|
|
|
||
Rehabilitation hospital(2)
|
|
621,105
|
|
|
868,517
|
|
|
894,192
|
|
|
|
|
|
|
|
|
|||
Outpatient rehabilitation(3)
|
|
969,014
|
|
|
954,661
|
|
|
1,002,819
|
|
|
|
|
|
|
|
|
|||
Concentra(4)
|
|
1,313,176
|
|
|
1,340,919
|
|
|
2,178,868
|
|
|
|
|
|
|
|
|
|||
Other(5)
|
|
107,318
|
|
|
114,286
|
|
|
116,781
|
|
|
|
|
|
|
|
|
|||
Total Company
|
|
$
|
4,920,626
|
|
|
$
|
5,127,166
|
|
|
$
|
5,964,265
|
|
|
|
|
|
|
|
|
Purchases of property and equipment, net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Critical illness recovery hospital(2)
|
|
$
|
48,626
|
|
|
$
|
49,720
|
|
|
$
|
40,855
|
|
|
|
|
|
|
||
Rehabilitation hospital(2)
|
|
60,513
|
|
|
96,477
|
|
|
42,389
|
|
|
|
|
|
|
|
|
|||
Outpatient rehabilitation(3)
|
|
21,286
|
|
|
27,721
|
|
|
30,553
|
|
|
|
|
|
|
|
|
|||
Concentra(4)
|
|
15,946
|
|
|
28,912
|
|
|
42,205
|
|
|
|
|
|
|
|
|
|||
Other(5)
|
|
15,262
|
|
|
30,413
|
|
|
11,279
|
|
|
|
|
|
|
|
|
|||
Total Company
|
|
$
|
161,633
|
|
|
$
|
233,243
|
|
|
$
|
167,281
|
|
|
|
|
|
|
|
|
(1)
|
Net operating revenues were retrospectively conformed to reflect the adoption Topic 606, Revenue from Contracts with Customers.
|
(2)
|
The critical illness recovery hospital segment was previously referred to as the long term acute care segment. The rehabilitation hospital segment was previously referred to as the inpatient rehabilitation segment.
|
(3)
|
The outpatient rehabilitation segment includes the operating results of our contract therapy businesses through March 31, 2016 and Physiotherapy beginning March 4, 2016.
|
(4)
|
The Concentra segment includes the operating results of U.S. HealthWorks beginning February 1, 2018.
|
(5)
|
Other includes our corporate services. Total assets includes certain non-consolidating joint ventures and minority investments in other healthcare related businesses.
|
(6)
|
As of December 31, 2016, total assets were retrospectively conformed to reflect the adoption ASU 2015-17, Balance Sheet Classification of Deferred Taxes, which resulted in a reduction to total assets of $23.8 million.
|
|
|
For the Year Ended December 31,
|
|
||||||||||
|
|
2016
|
|
2017
|
|
2018
|
|
||||||
Cash flows provided by operating activities
|
|
$
|
346,603
|
|
|
$
|
238,131
|
|
|
$
|
494,194
|
|
|
Cash flows used in investing activities
|
|
(554,320
|
)
|
|
(192,965
|
)
|
|
(697,137
|
)
|
|
|||
Cash flows provided by (used in) financing activities
|
|
292,311
|
|
|
(21,646
|
)
|
|
255,572
|
|
|
|||
Net increase in cash and cash equivalents
|
|
84,594
|
|
|
23,520
|
|
|
52,629
|
|
|
|||
Cash and cash equivalents at beginning of period
|
|
14,435
|
|
|
99,029
|
|
|
122,549
|
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
99,029
|
|
|
$
|
122,549
|
|
|
$
|
175,178
|
|
|
|
|
Total
|
|
2019
|
|
2020 - 2022
|
|
2023 - 2024
|
|
After 2024
|
|
||||||||||
|
|
(in thousands)
|
|
||||||||||||||||||
Debt(1)
|
|
$
|
3,338,381
|
|
|
$
|
43,865
|
|
|
$
|
1,996,077
|
|
|
$
|
264,451
|
|
|
$
|
1,033,988
|
|
|
Interest(2)(3)
|
|
725,881
|
|
|
179,246
|
|
|
425,215
|
|
|
111,121
|
|
|
10,299
|
|
|
|||||
Letters of credit outstanding(1)
|
|
50,191
|
|
|
—
|
|
|
50,191
|
|
|
—
|
|
|
—
|
|
|
|||||
Purchase obligations(4)(5)
|
|
223,054
|
|
|
122,112
|
|
|
72,152
|
|
|
24,710
|
|
|
4,080
|
|
|
|||||
Construction contracts(6)
|
|
21,616
|
|
|
21,616
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||||
Operating leases(6)
|
|
1,390,023
|
|
|
261,915
|
|
|
552,548
|
|
|
182,011
|
|
|
393,549
|
|
|
|||||
Related party operating leases(6)
|
|
44,641
|
|
|
5,931
|
|
|
22,473
|
|
|
5,527
|
|
|
10,710
|
|
|
|||||
Total contractual cash obligations(7)
|
|
$
|
5,793,787
|
|
|
$
|
634,685
|
|
|
$
|
3,118,656
|
|
|
$
|
587,820
|
|
|
$
|
1,452,626
|
|
|
(1)
|
See Note 9 – Long-Term Debt and Notes Payable of the notes to our consolidated financial statements included herein.
|
(2)
|
The interest obligation for the Select credit facilities was calculated using the average interest rate of 4.9% for the Select term loan and 5.1% for the Select revolving facility at December 31, 2018. The interest obligation for the 6.375% senior notes was calculated using the stated interest rate and a weighted average interest rate of 4.0% was used for Select’s other debt obligations.
|
(3)
|
The interest obligation for the Concentra credit facilities was calculated using the average interest rate of 4.8% for the Concentra first lien term loan and 8.5% for the Concentra second lien term loan at December 31, 2018. The weighted average interest rate for Concentra’s other debt obligations was 7.0%.
|
(4)
|
Amounts represent purchase commitments that are not presented as construction contract commitments above. Our purchase obligations primarily relate to software licensing and support.
|
(5)
|
Amounts include the $63.0 million purchase price related to an asset purchase agreement (the “Asset Purchase Agreement”), executed on December 26, 2018, with Promise Hospital of Florida at the Villages, Inc., HLP Properties at the Villages, L.L.C., Promise Properties of Lee, Inc., Promise Hospital of Lee, Inc., Promise Hospital of Dade, Inc., and Promise Properties of Dade, Inc. (“Promise Healthcare”), pursuant to which we will purchase substantially all of the assets of certain of Promise Healthcare’s Florida hospitals. The purchase price is subject to certain adjustments. The sale is subject to other conditions, including approval of the Asset Purchase Agreement by the Bankruptcy Court for the District of Delaware.
|
(6)
|
See Note 17 – Commitments and Contingencies of the notes to our consolidated financial statements included herein.
|
(7)
|
Workers’ compensation and professional malpractice liability insurance liabilities of $112.9 million, which are included as components of other non-current liabilities on the consolidated balance sheets, have been excluded from the table above as we cannot reasonably estimate the amounts or periods in which these liabilities will be paid.
|
Plan Category
|
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights (a)
|
|
Weighted-average exercise price of outstanding options, warrants and rights (b)
|
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))(c)
|
|
||||
Equity compensation plans approved by security holders:
|
|
|
|
|
|
|
|
|
|
|
|
Select Medical Holdings Corporation 2005 Equity Incentive Plan
|
|
105,000
|
|
|
$
|
9.18
|
|
|
—
|
|
(1)
|
Select Medical Holdings Corporation 2011 Equity Incentive Plan
|
|
—
|
|
|
—
|
|
|
—
|
|
(2)
|
|
Director Equity Incentive Plan
|
|
—
|
|
|
—
|
|
|
—
|
|
(2)
|
|
Select Medical Holdings Corporation 2016 Equity Incentive Plan
|
|
—
|
|
|
—
|
|
|
3,184,185
|
|
|
|
Equity compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1)
|
In connection with the approval of the Select Medical Holdings Corporation 2011 Equity Incentive Plan, we no longer issue awards under the Select Medical Holdings Corporation 2005 Equity Incentive Plan.
|
(2)
|
In connection with the approval of the Select Medical Holdings Corporation 2016 Equity Incentive Plan, as amended, we no longer issue awards under the Select Medical Holdings 2011 Equity Incentive Plan and the Director Equity Incentive Plan.
|
a.
|
The following documents are filed as part of this report:
|
i.
|
Financial Statements: See Index to Financial Statements appearing on page F-1 of this report.
|
ii.
|
Financial Statement Schedule: See Schedule II—Valuation and Qualifying Accounts appearing on page F-57 of this report.
|
iii.
|
The following exhibits are filed as part of, or incorporated by reference into, this report:
|
Number
|
|
Description
|
|
2.1
|
|
|
|
3.1
|
|
|
|
3.2
|
|
|
|
3.3
|
|
|
|
3.4
|
|
|
|
4.1
|
|
|
|
4.2
|
|
|
|
4.3
|
|
|
|
10.1
|
|
|
|
10.2
|
|
|
|
10.3
|
|
|
|
10.4
|
|
|
|
10.5
|
|
|
|
10.6
|
|
|
|
10.7
|
|
|
Number
|
|
Description
|
|
10.8
|
|
|
|
10.9
|
|
|
|
10.10
|
|
|
|
10.11
|
|
|
|
10.12
|
|
|
|
10.13
|
|
|
|
10.14
|
|
|
|
10.15
|
|
|
|
10.16
|
|
|
|
10.17
|
|
|
|
10.18
|
|
|
|
10.19
|
|
|
|
10.20
|
|
|
|
10.21
|
|
|
|
10.22
|
|
|
|
10.23
|
|
|
|
10.24
|
|
|
|
10.25
|
|
|
|
10.26
|
|
|
Number
|
|
Description
|
|
10.27
|
|
|
|
10.28
|
|
|
|
10.29
|
|
|
|
10.30
|
|
|
|
10.31
|
|
|
|
10.32
|
|
|
|
10.33
|
|
|
|
10.34
|
|
|
|
10.35
|
|
|
|
10.36
|
|
|
|
10.37
|
|
|
|
10.38
|
|
|
|
10.39
|
|
|
|
10.40
|
|
|
|
10.41
|
|
|
|
10.42
|
|
|
|
10.43
|
|
|
Number
|
|
Description
|
|
10.44
|
|
|
|
10.45
|
|
|
|
10.46
|
|
|
|
10.47
|
|
|
|
10.48
|
|
|
|
10.49
|
|
|
|
10.50
|
|
|
|
10.51
|
|
|
|
10.52
|
|
|
|
10.53
|
|
|
|
10.54
|
|
|
|
10.55
|
|
|
|
10.56
|
|
|
|
10.57
|
|
|
|
10.58
|
|
|
Number
|
|
Description
|
|
10.59
|
|
|
|
10.60
|
|
|
|
10.61
|
|
|
|
10.62
|
|
|
|
10.63
|
|
|
|
10.64
|
|
|
|
10.65
|
|
|
|
10.66
|
|
|
|
10.67
|
|
|
|
10.68
|
|
|
|
10.69
|
|
|
|
10.70
|
|
|
|
10.71
|
|
|
Number
|
|
Description
|
|
21.1
|
|
|
|
23
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
32.1
|
|
|
|
101.INS
|
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
101.SCH
|
|
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL
|
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.DEF
|
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB
|
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
101.PRE
|
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
|
|
|
|
|
SELECT MEDICAL HOLDINGS CORPORATION
SELECT MEDICAL CORPORATION
|
||
|
|
By:
|
|
/s/ MICHAEL E. TARVIN
Michael E. Tarvin
(Executive Vice President, General Counsel and Secretary)
|
|
|
|
/s/ ROCCO A. ORTENZIO
Rocco A. Ortenzio
Director, Vice Chairman and Co-Founder
|
|
/s/ ROBERT A. ORTENZIO
Robert A. Ortenzio
Director, Executive Chairman and Co-Founder
|
/s/ DAVID S. CHERNOW
David S. Chernow
President and Chief Executive Officer (principal executive officer)
|
|
/s/ MARTIN F. JACKSON
Martin F. Jackson
Executive Vice President and Chief Financial Officer (principal financial officer)
|
/s/ SCOTT A. ROMBERGER
Scott A. Romberger
Senior Vice President, Controller and Chief Accounting Officer (principal accounting officer)
|
|
/s/ RUSSELL L. CARSON
Russell L. Carson
Director
|
/s/ BRYAN C. CRESSEY
Bryan C. Cressey
Director
|
|
/s/ WILLIAM H. FRIST, M.D.
William H. Frist, M.D.
Director
|
/s/ JAMES S. ELY III
James S. Ely III
Director
|
|
/s/ LEOPOLD SWERGOLD
Leopold Swergold
Director
|
/s/ THOMAS A. SCULLY
Thomas A. Scully
Director
|
|
/s/ HAROLD L. PAZ
Harold L. Paz
Director
|
/s/ MARILYN B. TAVENNER
Marilyn B. Tavenner
Director
|
|
|
|
|
|
|
F-2
|
|
|
F-6
|
|
|
F-7
|
|
|
F-9
|
|
|
F-11
|
|
|
F-13
|
|
|
F-57
|
|
Select Medical Holdings Corporation
|
|
Select Medical Corporation
|
|
||||||||||||
|
December 31, 2017
|
|
December 31, 2018
|
|
December 31, 2017
|
|
December 31, 2018
|
|
||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash and cash equivalents
|
$
|
122,549
|
|
|
$
|
175,178
|
|
|
$
|
122,549
|
|
|
$
|
175,178
|
|
|
Accounts receivable
|
691,732
|
|
|
706,676
|
|
|
691,732
|
|
|
706,676
|
|
|
||||
Prepaid income taxes
|
31,387
|
|
|
20,539
|
|
|
31,387
|
|
|
20,539
|
|
|
||||
Other current assets
|
75,158
|
|
|
90,131
|
|
|
75,158
|
|
|
90,131
|
|
|
||||
Total Current Assets
|
920,826
|
|
|
992,524
|
|
|
920,826
|
|
|
992,524
|
|
|
||||
Property and equipment, net
|
912,591
|
|
|
979,810
|
|
|
912,591
|
|
|
979,810
|
|
|
||||
Goodwill
|
2,782,812
|
|
|
3,320,726
|
|
|
2,782,812
|
|
|
3,320,726
|
|
|
||||
Identifiable intangible assets, net
|
326,519
|
|
|
437,693
|
|
|
326,519
|
|
|
437,693
|
|
|
||||
Other assets
|
184,418
|
|
|
233,512
|
|
|
184,418
|
|
|
233,512
|
|
|
||||
Total Assets
|
$
|
5,127,166
|
|
|
$
|
5,964,265
|
|
|
$
|
5,127,166
|
|
|
$
|
5,964,265
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Overdrafts
|
$
|
29,463
|
|
|
$
|
25,083
|
|
|
$
|
29,463
|
|
|
$
|
25,083
|
|
|
Current portion of long-term debt and notes payable
|
22,187
|
|
|
43,865
|
|
|
22,187
|
|
|
43,865
|
|
|
||||
Accounts payable
|
128,194
|
|
|
146,693
|
|
|
128,194
|
|
|
146,693
|
|
|
||||
Accrued payroll
|
160,562
|
|
|
172,386
|
|
|
160,562
|
|
|
172,386
|
|
|
||||
Accrued vacation
|
92,875
|
|
|
110,660
|
|
|
92,875
|
|
|
110,660
|
|
|
||||
Accrued interest
|
19,885
|
|
|
12,137
|
|
|
19,885
|
|
|
12,137
|
|
|
||||
Accrued other
|
143,166
|
|
|
190,691
|
|
|
143,166
|
|
|
190,691
|
|
|
||||
Income taxes payable
|
9,071
|
|
|
3,671
|
|
|
9,071
|
|
|
3,671
|
|
|
||||
Total Current Liabilities
|
605,403
|
|
|
705,186
|
|
|
605,403
|
|
|
705,186
|
|
|
||||
Long-term debt, net of current portion
|
2,677,715
|
|
|
3,249,516
|
|
|
2,677,715
|
|
|
3,249,516
|
|
|
||||
Non-current deferred tax liability
|
124,917
|
|
|
153,895
|
|
|
124,917
|
|
|
153,895
|
|
|
||||
Other non-current liabilities
|
145,709
|
|
|
158,940
|
|
|
145,709
|
|
|
158,940
|
|
|
||||
Total Liabilities
|
3,553,744
|
|
|
4,267,537
|
|
|
3,553,744
|
|
|
4,267,537
|
|
|
||||
Commitments and contingencies (Note 17)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Redeemable non-controlling interests
|
640,818
|
|
|
780,488
|
|
|
640,818
|
|
|
780,488
|
|
|
||||
Stockholders’ Equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Common stock of Holdings, $0.001 par value, 700,000,000 shares authorized, 134,114,715 and 135,265,864 shares issued and outstanding at 2017 and 2018, respectively
|
134
|
|
|
135
|
|
|
—
|
|
|
—
|
|
|
||||
Common stock of Select, $0.01 par value, 100 shares issued and outstanding
|
—
|
|
|
—
|
|
|
0
|
|
|
0
|
|
|
||||
Capital in excess of par
|
463,499
|
|
|
482,556
|
|
|
947,370
|
|
|
970,156
|
|
|
||||
Retained earnings (accumulated deficit)
|
359,735
|
|
|
320,351
|
|
|
(124,002
|
)
|
|
(167,114
|
)
|
|
||||
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders’ Equity
|
823,368
|
|
|
803,042
|
|
|
823,368
|
|
|
803,042
|
|
|
||||
Non-controlling interests
|
109,236
|
|
|
113,198
|
|
|
109,236
|
|
|
113,198
|
|
|
||||
Total Equity
|
932,604
|
|
|
916,240
|
|
|
932,604
|
|
|
916,240
|
|
|
||||
Total Liabilities and Equity
|
$
|
5,127,166
|
|
|
$
|
5,964,265
|
|
|
$
|
5,127,166
|
|
|
$
|
5,964,265
|
|
|
|
For the Year Ended December 31,
|
|
||||||||||
|
2016
|
|
2017
|
|
2018
|
|
||||||
Net operating revenues
|
$
|
4,217,460
|
|
|
$
|
4,365,245
|
|
|
$
|
5,081,258
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|||
Cost of services, exclusive of depreciation and amortization
|
3,665,375
|
|
|
3,735,309
|
|
|
4,341,056
|
|
|
|||
General and administrative
|
106,927
|
|
|
114,047
|
|
|
121,268
|
|
|
|||
Depreciation and amortization
|
145,311
|
|
|
160,011
|
|
|
201,655
|
|
|
|||
Total costs and expenses
|
3,917,613
|
|
|
4,009,367
|
|
|
4,663,979
|
|
|
|||
Income from operations
|
299,847
|
|
|
355,878
|
|
|
417,279
|
|
|
|||
Other income and expense:
|
|
|
|
|
|
|
|
|
|
|||
Loss on early retirement of debt
|
(11,626
|
)
|
|
(19,719
|
)
|
|
(14,155
|
)
|
|
|||
Equity in earnings of unconsolidated subsidiaries
|
19,943
|
|
|
21,054
|
|
|
21,905
|
|
|
|||
Non-operating gain (loss)
|
42,651
|
|
|
(49
|
)
|
|
9,016
|
|
|
|||
Interest expense
|
(170,081
|
)
|
|
(154,703
|
)
|
|
(198,493
|
)
|
|
|||
Income before income taxes
|
180,734
|
|
|
202,461
|
|
|
235,552
|
|
|
|||
Income tax expense (benefit)
|
55,464
|
|
|
(18,184
|
)
|
|
58,610
|
|
|
|||
Net income
|
125,270
|
|
|
220,645
|
|
|
176,942
|
|
|
|||
Less: Net income attributable to non-controlling interests
|
9,859
|
|
|
43,461
|
|
|
39,102
|
|
|
|||
Net income attributable to Select Medical Holdings Corporation
|
$
|
115,411
|
|
|
$
|
177,184
|
|
|
$
|
137,840
|
|
|
Earnings per common share (Note 16):
|
|
|
|
|
|
|
||||||
Basic
|
$
|
0.88
|
|
|
$
|
1.33
|
|
|
$
|
1.02
|
|
|
Diluted
|
$
|
0.87
|
|
|
$
|
1.33
|
|
|
$
|
1.02
|
|
|
|
|
For the Year Ended December 31,
|
|
||||||||||
|
|
2016
|
|
2017
|
|
2018
|
|
||||||
Net operating revenues
|
|
$
|
4,217,460
|
|
|
$
|
4,365,245
|
|
|
$
|
5,081,258
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|||
Cost of services, exclusive of depreciation and amortization
|
|
3,665,375
|
|
|
3,735,309
|
|
|
4,341,056
|
|
|
|||
General and administrative
|
|
106,927
|
|
|
114,047
|
|
|
121,268
|
|
|
|||
Depreciation and amortization
|
|
145,311
|
|
|
160,011
|
|
|
201,655
|
|
|
|||
Total costs and expenses
|
|
3,917,613
|
|
|
4,009,367
|
|
|
4,663,979
|
|
|
|||
Income from operations
|
|
299,847
|
|
|
355,878
|
|
|
417,279
|
|
|
|||
Other income and expense:
|
|
|
|
|
|
|
|
|
|
|
|||
Loss on early retirement of debt
|
|
(11,626
|
)
|
|
(19,719
|
)
|
|
(14,155
|
)
|
|
|||
Equity in earnings of unconsolidated subsidiaries
|
|
19,943
|
|
|
21,054
|
|
|
21,905
|
|
|
|||
Non-operating gain (loss)
|
|
42,651
|
|
|
(49
|
)
|
|
9,016
|
|
|
|||
Interest expense
|
|
(170,081
|
)
|
|
(154,703
|
)
|
|
(198,493
|
)
|
|
|||
Income before income taxes
|
|
180,734
|
|
|
202,461
|
|
|
235,552
|
|
|
|||
Income tax expense (benefit)
|
|
55,464
|
|
|
(18,184
|
)
|
|
58,610
|
|
|
|||
Net income
|
|
125,270
|
|
|
220,645
|
|
|
176,942
|
|
|
|||
Less: Net income attributable to non-controlling interests
|
|
9,859
|
|
|
43,461
|
|
|
39,102
|
|
|
|||
Net income attributable to Select Medical Corporation
|
|
$
|
115,411
|
|
|
$
|
177,184
|
|
|
$
|
137,840
|
|
|
|
|
|
|
|
Select Medical Holdings Corporation Stockholders
|
|
|
|
|
|
|||||||||||||||||||||||
|
|
Redeemable
Non-controlling
interests
|
|
|
Common
Stock
Issued
|
|
Common
Stock
Par Value
|
|
Capital in
Excess
of Par
|
|
Retained
Earnings
|
|
Total
Stockholders’
Equity
|
|
Non-controlling
Interests
|
|
Total
Equity
|
|
|||||||||||||||
Balance at December 31, 2015
|
|
$
|
238,221
|
|
|
|
131,283
|
|
|
$
|
131
|
|
|
$
|
424,506
|
|
|
$
|
434,616
|
|
|
$
|
859,253
|
|
|
$
|
49,264
|
|
|
$
|
908,517
|
|
|
Net income attributable to Select Medical Holdings Corporation
|
|
|
|
|
|
|
|
|
|
|
|
|
115,411
|
|
|
115,411
|
|
|
|
|
115,411
|
|
|
||||||||||
Net income (loss) attributable to non-controlling interests
|
|
12,479
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
(2,620
|
)
|
|
(2,620
|
)
|
|
||||||||||
Issuance of restricted stock
|
|
|
|
|
|
1,426
|
|
|
1
|
|
|
(1
|
)
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|||||||||
Forfeitures of unvested restricted stock
|
|
|
|
|
(82
|
)
|
|
0
|
|
|
0
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
||||||||||
Vesting of restricted stock
|
|
|
|
|
|
|
|
|
16,640
|
|
|
|
|
16,640
|
|
|
|
|
16,640
|
|
|
||||||||||||
Repurchase of common shares
|
|
|
|
|
|
(232
|
)
|
|
0
|
|
|
(1,333
|
)
|
|
(1,596
|
)
|
|
(2,929
|
)
|
|
|
|
(2,929
|
)
|
|
||||||||
Stock option expense
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
|
|
4
|
|
|
|
|
4
|
|
|
||||||||||
Exercise of stock options
|
|
|
|
|
|
202
|
|
|
0
|
|
|
1,672
|
|
|
|
|
1,672
|
|
|
|
|
1,672
|
|
|
|||||||||
Issuance of non-controlling interests
|
|
|
|
|
|
|
|
|
|
|
2,377
|
|
|
|
|
2,377
|
|
|
47,801
|
|
|
50,178
|
|
|
|||||||||
Acquired non-controlling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
2,514
|
|
|
2,514
|
|
|
||||||||||
Distributions to and purchases of non-controlling interests
|
|
(5,984
|
)
|
|
|
|
|
|
|
|
75
|
|
|
579
|
|
|
654
|
|
|
(7,324
|
)
|
|
(6,670
|
)
|
|
||||||||
Redemption adjustment on non-controlling interests
|
|
177,216
|
|
|
|
|
|
|
|
|
|
|
(177,216
|
)
|
|
(177,216
|
)
|
|
|
|
(177,216
|
)
|
|
||||||||||
Other
|
|
227
|
|
|
|
|
|
|
|
|
(32
|
)
|
|
(109
|
)
|
|
(141
|
)
|
|
541
|
|
|
400
|
|
|
||||||||
Balance at December 31, 2016
|
|
$
|
422,159
|
|
|
|
132,597
|
|
|
$
|
132
|
|
|
$
|
443,908
|
|
|
$
|
371,685
|
|
|
$
|
815,725
|
|
|
$
|
90,176
|
|
|
$
|
905,901
|
|
|
Net income attributable to Select Medical Holdings Corporation
|
|
|
|
|
|
|
|
|
|
|
|
177,184
|
|
|
177,184
|
|
|
|
|
177,184
|
|
|
|||||||||||
Net income attributable to non-controlling interests
|
|
35,639
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
7,822
|
|
|
7,822
|
|
|
||||||||||
Issuance of restricted stock
|
|
|
|
|
|
1,598
|
|
|
2
|
|
|
(2
|
)
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|||||||||
Forfeitures of unvested restricted stock
|
|
|
|
|
(27
|
)
|
|
0
|
|
|
0
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
||||||||||
Vesting of restricted stock
|
|
|
|
|
|
|
|
|
18,291
|
|
|
|
|
18,291
|
|
|
|
|
18,291
|
|
|
||||||||||||
Repurchase of common shares
|
|
|
|
|
|
(280
|
)
|
|
0
|
|
|
(2,666
|
)
|
|
(2,087
|
)
|
|
(4,753
|
)
|
|
|
|
(4,753
|
)
|
|
||||||||
Exercise of stock options
|
|
|
|
|
|
227
|
|
|
0
|
|
|
2,017
|
|
|
|
|
2,017
|
|
|
|
|
2,017
|
|
|
|||||||||
Issuance of non-controlling interests
|
|
|
|
|
|
|
|
|
|
1,951
|
|
|
|
|
1,951
|
|
|
16,329
|
|
|
18,280
|
|
|
||||||||||
Distributions to and purchases of non-controlling interests
|
|
(5,334
|
)
|
|
|
|
|
|
|
|
|
|
7
|
|
|
7
|
|
|
(5,293
|
)
|
|
(5,286
|
)
|
|
|||||||||
Redemption adjustment on non-controlling interests
|
|
187,506
|
|
|
|
|
|
|
|
|
|
|
(187,506
|
)
|
|
(187,506
|
)
|
|
|
|
(187,506
|
)
|
|
||||||||||
Other
|
|
848
|
|
|
|
|
|
|
|
|
|
|
|
452
|
|
|
452
|
|
|
202
|
|
|
654
|
|
|
||||||||
Balance at December 31, 2017
|
|
$
|
640,818
|
|
|
|
134,115
|
|
|
$
|
134
|
|
|
$
|
463,499
|
|
|
$
|
359,735
|
|
|
$
|
823,368
|
|
|
$
|
109,236
|
|
|
$
|
932,604
|
|
|
Net income attributable to Select Medical Holdings Corporation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
137,840
|
|
|
137,840
|
|
|
|
|
137,840
|
|
|
||||||||
Net income attributable to non-controlling interests
|
|
27,775
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
11,327
|
|
|
11,327
|
|
|
|||||||
Issuance of restricted stock
|
|
|
|
|
|
1,491
|
|
|
1
|
|
|
(1
|
)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
||||||||
Forfeitures of unvested restricted stock
|
|
|
|
|
(168
|
)
|
|
0
|
|
|
0
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
||||||||||
Vesting of restricted stock
|
|
|
|
|
|
|
|
|
20,443
|
|
|
|
|
20,443
|
|
|
|
|
20,443
|
|
|
||||||||||||
Repurchase of common shares
|
|
|
|
|
|
(357
|
)
|
|
0
|
|
|
(3,728
|
)
|
|
(3,109
|
)
|
|
(6,837
|
)
|
|
|
|
(6,837
|
)
|
|
||||||||
Exercise of stock options
|
|
|
|
|
|
185
|
|
|
0
|
|
|
1,722
|
|
|
|
|
|
1,722
|
|
|
|
|
1,722
|
|
|
||||||||
Issuance and exchange of non-controlling interests
|
|
163,659
|
|
|
|
|
|
|
|
|
|
1,553
|
|
|
74,341
|
|
|
75,894
|
|
|
1,921
|
|
|
77,815
|
|
|
|||||||
Distributions to and purchases of non-controlling interests
|
|
(217,570
|
)
|
|
|
|
|
|
|
|
|
(932
|
)
|
|
(83,617
|
)
|
|
(84,549
|
)
|
|
(10,839
|
)
|
|
(95,388
|
)
|
|
|||||||
Redemption adjustment on non-controlling interests
|
|
164,476
|
|
|
|
|
|
|
|
|
|
|
|
|
(164,476
|
)
|
|
(164,476
|
)
|
|
|
|
(164,476
|
)
|
|
||||||||
Other
|
|
1,330
|
|
|
|
|
|
|
|
|
|
|
|
|
(363
|
)
|
|
(363
|
)
|
|
1,553
|
|
|
1,190
|
|
|
|||||||
Balance at December 31, 2018
|
|
$
|
780,488
|
|
|
|
135,266
|
|
|
$
|
135
|
|
|
$
|
482,556
|
|
|
$
|
320,351
|
|
|
$
|
803,042
|
|
|
$
|
113,198
|
|
|
$
|
916,240
|
|
|
|
|
|
|
|
Select Medical Corporation Stockholders
|
|
|
|
|
|
|||||||||||||||||||||||
|
|
Redeemable
Non-controlling
interests
|
|
|
Common
Stock
Issued
|
|
Common
Stock
Par Value
|
|
Capital in
Excess
of Par
|
|
Retained
Earnings
|
|
Total
Stockholders’
Equity
|
|
Non-controlling
Interests
|
|
Total
Equity
|
|
|||||||||||||||
Balance at December 31, 2015
|
|
$
|
238,221
|
|
|
|
0
|
|
|
$
|
0
|
|
|
$
|
904,375
|
|
|
$
|
(45,122
|
)
|
|
$
|
859,253
|
|
|
$
|
49,264
|
|
|
$
|
908,517
|
|
|
Net income attributable to Select Medical Corporation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
115,411
|
|
|
115,411
|
|
|
|
|
115,411
|
|
|
||||||||
Net income (loss) attributable to non-controlling interests
|
|
12,479
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
(2,620
|
)
|
|
(2,620
|
)
|
|
|||||||
Additional investment by Holdings
|
|
|
|
|
|
|
|
|
|
|
|
1,672
|
|
|
|
|
|
1,672
|
|
|
|
|
1,672
|
|
|
||||||||
Dividends declared and paid to Holdings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,929
|
)
|
|
(2,929
|
)
|
|
|
|
(2,929
|
)
|
|
||||||||
Contribution related to restricted stock award and stock option issuances by Holdings
|
|
|
|
|
|
|
|
|
|
|
|
16,644
|
|
|
|
|
|
16,644
|
|
|
|
|
16,644
|
|
|
||||||||
Issuance of non-controlling interests
|
|
|
|
|
|
|
|
|
|
|
|
2,377
|
|
|
|
|
|
2,377
|
|
|
47,801
|
|
|
50,178
|
|
|
|||||||
Acquired non-controlling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
2,514
|
|
|
2,514
|
|
|
|||||||||||
Distributions to and purchases of non-controlling interests
|
|
(5,984
|
)
|
|
|
|
|
|
|
|
|
75
|
|
|
579
|
|
|
654
|
|
|
(7,324
|
)
|
|
(6,670
|
)
|
|
|||||||
Redemption adjustment on non-controlling interests
|
|
177,216
|
|
|
|
|
|
|
|
|
|
|
|
|
(177,216
|
)
|
|
(177,216
|
)
|
|
|
|
(177,216
|
)
|
|
||||||||
Other
|
|
227
|
|
|
|
|
|
|
|
|
|
(32
|
)
|
|
(109
|
)
|
|
(141
|
)
|
|
541
|
|
|
400
|
|
|
|||||||
Balance at December 31, 2016
|
|
$
|
422,159
|
|
|
|
0
|
|
|
$
|
0
|
|
|
$
|
925,111
|
|
|
$
|
(109,386
|
)
|
|
$
|
815,725
|
|
|
$
|
90,176
|
|
|
$
|
905,901
|
|
|
Net income attributable to Select Medical Corporation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
177,184
|
|
|
177,184
|
|
|
|
|
177,184
|
|
|
||||||||
Net income attributable to non-controlling interests
|
|
35,639
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
7,822
|
|
|
7,822
|
|
|
|||||||
Additional investment by Holdings
|
|
|
|
|
|
|
|
|
|
|
|
2,017
|
|
|
|
|
|
2,017
|
|
|
|
|
2,017
|
|
|
||||||||
Dividends declared and paid to Holdings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4,753
|
)
|
|
(4,753
|
)
|
|
|
|
(4,753
|
)
|
|
||||||||
Contribution related to restricted stock award issuances by Holdings
|
|
|
|
|
|
|
|
|
|
|
|
18,291
|
|
|
|
|
|
18,291
|
|
|
|
|
18,291
|
|
|
||||||||
Issuance of non-controlling interests
|
|
|
|
|
|
|
|
|
|
|
|
1,951
|
|
|
|
|
|
1,951
|
|
|
16,329
|
|
|
18,280
|
|
|
|||||||
Distributions to and purchases of non-controlling interests
|
|
(5,334
|
)
|
|
|
|
|
|
|
|
|
|
|
|
7
|
|
|
7
|
|
|
(5,293
|
)
|
|
(5,286
|
)
|
|
|||||||
Redemption adjustment on non-controlling interests
|
|
187,506
|
|
|
|
|
|
|
|
|
|
|
|
|
(187,506
|
)
|
|
(187,506
|
)
|
|
|
|
(187,506
|
)
|
|
||||||||
Other
|
|
848
|
|
|
|
|
|
|
|
|
|
|
|
|
452
|
|
|
452
|
|
|
202
|
|
|
654
|
|
|
|||||||
Balance at December 31, 2017
|
|
$
|
640,818
|
|
|
|
0
|
|
|
$
|
0
|
|
|
$
|
947,370
|
|
|
$
|
(124,002
|
)
|
|
$
|
823,368
|
|
|
$
|
109,236
|
|
|
$
|
932,604
|
|
|
Net income attributable to Select Medical Corporation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
137,840
|
|
|
137,840
|
|
|
|
|
137,840
|
|
|
||||||||
Net income attributable to non-controlling interests
|
|
27,775
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
11,327
|
|
|
11,327
|
|
|
|||||||
Additional investment by Holdings
|
|
|
|
|
|
|
|
|
|
|
|
1,722
|
|
|
|
|
|
1,722
|
|
|
|
|
1,722
|
|
|
||||||||
Dividends declared and paid to Holdings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6,837
|
)
|
|
(6,837
|
)
|
|
|
|
(6,837
|
)
|
|
||||||||
Contribution related to restricted stock award issuances by Holdings
|
|
|
|
|
|
|
|
|
|
|
|
20,443
|
|
|
|
|
|
20,443
|
|
|
|
|
20,443
|
|
|
||||||||
Issuance and exchange of non-controlling interests
|
|
163,659
|
|
|
|
|
|
|
|
|
|
1,553
|
|
|
74,341
|
|
|
75,894
|
|
|
1,921
|
|
|
77,815
|
|
|
|||||||
Distributions to and purchases of non-controlling interests
|
|
(217,570
|
)
|
|
|
|
|
|
|
|
|
(932
|
)
|
|
(83,617
|
)
|
|
(84,549
|
)
|
|
(10,839
|
)
|
|
(95,388
|
)
|
|
|||||||
Redemption adjustment on non-controlling interests
|
|
164,476
|
|
|
|
|
|
|
|
|
|
|
|
|
(164,476
|
)
|
|
(164,476
|
)
|
|
|
|
(164,476
|
)
|
|
||||||||
Other
|
|
1,330
|
|
|
|
|
|
|
|
|
|
|
|
|
(363
|
)
|
|
(363
|
)
|
|
1,553
|
|
|
1,190
|
|
|
|||||||
Balance at December 31, 2018
|
|
$
|
780,488
|
|
|
|
0
|
|
|
$
|
0
|
|
|
$
|
970,156
|
|
|
$
|
(167,114
|
)
|
|
$
|
803,042
|
|
|
$
|
113,198
|
|
|
$
|
916,240
|
|
|
|
|
For the Year Ended December 31,
|
|
||||||||||
|
|
2016
|
|
2017
|
|
2018
|
|
||||||
Operating activities
|
|
|
|
|
|
|
|
|
|
|
|||
Net income
|
|
$
|
125,270
|
|
|
$
|
220,645
|
|
|
$
|
176,942
|
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|||
Distributions from unconsolidated subsidiaries
|
|
20,476
|
|
|
20,006
|
|
|
15,721
|
|
|
|||
Depreciation and amortization
|
|
145,311
|
|
|
160,011
|
|
|
201,655
|
|
|
|||
Provision for bad debts
|
|
532
|
|
|
1,133
|
|
|
(103
|
)
|
|
|||
Equity in earnings of unconsolidated subsidiaries
|
|
(19,943
|
)
|
|
(21,054
|
)
|
|
(21,905
|
)
|
|
|||
Loss on extinguishment of debt
|
|
11,626
|
|
|
6,527
|
|
|
2,999
|
|
|
|||
Gain on sale of assets and businesses
|
|
(46,488
|
)
|
|
(10,349
|
)
|
|
(9,168
|
)
|
|
|||
Gain on sale of equity investment
|
|
(2,779
|
)
|
|
—
|
|
|
—
|
|
|
|||
Impairment of equity investment
|
|
5,339
|
|
|
—
|
|
|
—
|
|
|
|||
Stock compensation expense
|
|
17,413
|
|
|
19,284
|
|
|
23,326
|
|
|
|||
Amortization of debt discount, premium and issuance costs
|
|
15,656
|
|
|
11,130
|
|
|
13,112
|
|
|
|||
Deferred income taxes
|
|
(12,591
|
)
|
|
(72,324
|
)
|
|
7,217
|
|
|
|||
Changes in operating assets and liabilities, net of effects of business combinations:
|
|
|
|
|
|
|
|
|
|
|
|||
Accounts receivable
|
|
29,241
|
|
|
(118,833
|
)
|
|
54,575
|
|
|
|||
Other current assets
|
|
17,450
|
|
|
1,597
|
|
|
(4,152
|
)
|
|
|||
Other assets
|
|
9,290
|
|
|
(886
|
)
|
|
7,857
|
|
|
|||
Accounts payable
|
|
(15,492
|
)
|
|
3,903
|
|
|
(1,778
|
)
|
|
|||
Accrued expenses
|
|
46,292
|
|
|
17,341
|
|
|
27,896
|
|
|
|||
Net cash provided by operating activities
|
|
346,603
|
|
|
238,131
|
|
|
494,194
|
|
|
|||
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|||
Business combinations, net of cash acquired
|
|
(472,206
|
)
|
|
(27,390
|
)
|
|
(523,134
|
)
|
|
|||
Purchases of property and equipment
|
|
(161,633
|
)
|
|
(233,243
|
)
|
|
(167,281
|
)
|
|
|||
Investment in businesses
|
|
(4,723
|
)
|
|
(12,682
|
)
|
|
(13,482
|
)
|
|
|||
Proceeds from sale of assets and businesses
|
|
80,463
|
|
|
80,350
|
|
|
6,760
|
|
|
|||
Proceeds from sale of equity investment
|
|
3,779
|
|
|
—
|
|
|
—
|
|
|
|||
Net cash used in investing activities
|
|
(554,320
|
)
|
|
(192,965
|
)
|
|
(697,137
|
)
|
|
|||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|||
Borrowings on revolving facilities
|
|
575,000
|
|
|
970,000
|
|
|
595,000
|
|
|
|||
Payments on revolving facilities
|
|
(655,000
|
)
|
|
(960,000
|
)
|
|
(805,000
|
)
|
|
|||
Proceeds from term loans
|
|
795,344
|
|
|
1,139,487
|
|
|
779,823
|
|
|
|||
Payments on term loans
|
|
(438,034
|
)
|
|
(1,179,442
|
)
|
|
(11,500
|
)
|
|
|||
Revolving facility debt issuance costs
|
|
—
|
|
|
(4,392
|
)
|
|
(1,639
|
)
|
|
|||
Borrowings of other debt
|
|
27,721
|
|
|
46,621
|
|
|
42,218
|
|
|
|||
Principal payments on other debt
|
|
(21,401
|
)
|
|
(20,647
|
)
|
|
(25,242
|
)
|
|
|||
Repurchase of common stock
|
|
(2,929
|
)
|
|
(4,753
|
)
|
|
(6,837
|
)
|
|
|||
Proceeds from exercise of stock options
|
|
1,672
|
|
|
2,017
|
|
|
1,722
|
|
|
|||
Increase (decrease) in overdrafts
|
|
10,746
|
|
|
(9,899
|
)
|
|
(4,380
|
)
|
|
|||
Proceeds from issuance of non-controlling interests
|
|
11,846
|
|
|
9,982
|
|
|
2,926
|
|
|
|||
Distributions to and purchases of non-controlling interests
|
|
(12,654
|
)
|
|
(10,620
|
)
|
|
(311,519
|
)
|
|
|||
Net cash provided by (used in) financing activities
|
|
292,311
|
|
|
(21,646
|
)
|
|
255,572
|
|
|
|||
Net increase in cash and cash equivalents
|
|
84,594
|
|
|
23,520
|
|
|
52,629
|
|
|
|||
Cash and cash equivalents at beginning of period
|
|
14,435
|
|
|
99,029
|
|
|
122,549
|
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
99,029
|
|
|
$
|
122,549
|
|
|
$
|
175,178
|
|
|
Supplemental information:
|
|
|
|
|
|
|
|
|
|
|
|||
Cash paid for interest
|
|
$
|
142,640
|
|
|
$
|
149,156
|
|
|
$
|
193,406
|
|
|
Cash paid for taxes
|
|
70,756
|
|
|
64,991
|
|
|
48,153
|
|
|
|||
Non-cash investing and financing activities:
|
|
|
|
|
|
|
|
||||||
Liabilities for purchases of property and equipment
|
|
$
|
32,861
|
|
|
$
|
30,043
|
|
|
$
|
29,134
|
|
|
Non-cash equity exchange for acquisition of U.S. HealthWorks
|
|
—
|
|
|
—
|
|
|
238,000
|
|
|
|
|
For the Year Ended December 31,
|
|
||||||||||
|
|
2016
|
|
2017
|
|
2018
|
|
||||||
Operating activities
|
|
|
|
|
|
|
|
|
|
|
|||
Net income
|
|
$
|
125,270
|
|
|
$
|
220,645
|
|
|
$
|
176,942
|
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|||
Distributions from unconsolidated subsidiaries
|
|
20,476
|
|
|
20,006
|
|
|
15,721
|
|
|
|||
Depreciation and amortization
|
|
145,311
|
|
|
160,011
|
|
|
201,655
|
|
|
|||
Provision for bad debts
|
|
532
|
|
|
1,133
|
|
|
(103
|
)
|
|
|||
Equity in earnings of unconsolidated subsidiaries
|
|
(19,943
|
)
|
|
(21,054
|
)
|
|
(21,905
|
)
|
|
|||
Loss on extinguishment of debt
|
|
11,626
|
|
|
6,527
|
|
|
2,999
|
|
|
|||
Gain on sale of assets and businesses
|
|
(46,488
|
)
|
|
(10,349
|
)
|
|
(9,168
|
)
|
|
|||
Gain on sale of equity investment
|
|
(2,779
|
)
|
|
—
|
|
|
—
|
|
|
|||
Impairment of equity investment
|
|
5,339
|
|
|
—
|
|
|
—
|
|
|
|||
Stock compensation expense
|
|
17,413
|
|
|
19,284
|
|
|
23,326
|
|
|
|||
Amortization of debt discount, premium and issuance costs
|
|
15,656
|
|
|
11,130
|
|
|
13,112
|
|
|
|||
Deferred income taxes
|
|
(12,591
|
)
|
|
(72,324
|
)
|
|
7,217
|
|
|
|||
Changes in operating assets and liabilities, net of effects of business combinations:
|
|
|
|
|
|
|
|
|
|
|
|||
Accounts receivable
|
|
29,241
|
|
|
(118,833
|
)
|
|
54,575
|
|
|
|||
Other current assets
|
|
17,450
|
|
|
1,597
|
|
|
(4,152
|
)
|
|
|||
Other assets
|
|
9,290
|
|
|
(886
|
)
|
|
7,857
|
|
|
|||
Accounts payable
|
|
(15,492
|
)
|
|
3,903
|
|
|
(1,778
|
)
|
|
|||
Accrued expenses
|
|
46,292
|
|
|
17,341
|
|
|
27,896
|
|
|
|||
Net cash provided by operating activities
|
|
346,603
|
|
|
238,131
|
|
|
494,194
|
|
|
|||
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|||
Business combinations, net of cash acquired
|
|
(472,206
|
)
|
|
(27,390
|
)
|
|
(523,134
|
)
|
|
|||
Purchases of property and equipment
|
|
(161,633
|
)
|
|
(233,243
|
)
|
|
(167,281
|
)
|
|
|||
Investment in businesses
|
|
(4,723
|
)
|
|
(12,682
|
)
|
|
(13,482
|
)
|
|
|||
Proceeds from sale of assets and businesses
|
|
80,463
|
|
|
80,350
|
|
|
6,760
|
|
|
|||
Proceeds from sale of equity investment
|
|
3,779
|
|
|
—
|
|
|
—
|
|
|
|||
Net cash used in investing activities
|
|
(554,320
|
)
|
|
(192,965
|
)
|
|
(697,137
|
)
|
|
|||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|||
Borrowings on revolving facilities
|
|
575,000
|
|
|
970,000
|
|
|
595,000
|
|
|
|||
Payments on revolving facilities
|
|
(655,000
|
)
|
|
(960,000
|
)
|
|
(805,000
|
)
|
|
|||
Proceeds from term loans
|
|
795,344
|
|
|
1,139,487
|
|
|
779,823
|
|
|
|||
Payments on term loans
|
|
(438,034
|
)
|
|
(1,179,442
|
)
|
|
(11,500
|
)
|
|
|||
Revolving facility debt issuance costs
|
|
—
|
|
|
(4,392
|
)
|
|
(1,639
|
)
|
|
|||
Borrowings of other debt
|
|
27,721
|
|
|
46,621
|
|
|
42,218
|
|
|
|||
Principal payments on other debt
|
|
(21,401
|
)
|
|
(20,647
|
)
|
|
(25,242
|
)
|
|
|||
Dividends paid to Holdings
|
|
(2,929
|
)
|
|
(4,753
|
)
|
|
(6,837
|
)
|
|
|||
Equity investment by Holdings
|
|
1,672
|
|
|
2,017
|
|
|
1,722
|
|
|
|||
Increase (decrease) in overdrafts
|
|
10,746
|
|
|
(9,899
|
)
|
|
(4,380
|
)
|
|
|||
Proceeds from issuance of non-controlling interests
|
|
11,846
|
|
|
9,982
|
|
|
2,926
|
|
|
|||
Distributions to and purchases of non-controlling interests
|
|
(12,654
|
)
|
|
(10,620
|
)
|
|
(311,519
|
)
|
|
|||
Net cash provided by (used in) financing activities
|
|
292,311
|
|
|
(21,646
|
)
|
|
255,572
|
|
|
|||
Net increase in cash and cash equivalents
|
|
84,594
|
|
|
23,520
|
|
|
52,629
|
|
|
|||
Cash and cash equivalents at beginning of period
|
|
14,435
|
|
|
99,029
|
|
|
122,549
|
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
99,029
|
|
|
$
|
122,549
|
|
|
$
|
175,178
|
|
|
Supplemental information:
|
|
|
|
|
|
|
|
|
|
|
|||
Cash paid for interest
|
|
$
|
142,640
|
|
|
$
|
149,156
|
|
|
$
|
193,406
|
|
|
Cash paid for taxes
|
|
70,756
|
|
|
64,991
|
|
|
48,153
|
|
|
|||
Non-cash investing and financing activities:
|
|
|
|
|
|
|
|
||||||
Liabilities for purchases of property and equipment
|
|
$
|
32,861
|
|
|
$
|
30,043
|
|
|
$
|
29,134
|
|
|
Non-cash equity exchange for acquisition of U.S. HealthWorks
|
|
—
|
|
|
—
|
|
|
238,000
|
|
|
1.
|
Organization and Significant Accounting Policies
|
1.
|
Organization and Significant Accounting Policies (Continued)
|
(i)
|
Net income attributable to the Company is reduced by the amount of dividends declared and the contractual amount of dividends in the current period for each class of stock, if any.
|
(ii)
|
The remaining undistributed net income of the Company is then equally allocated to its common stock and unvested restricted stock awards, as if all of the earnings for the period had been distributed. The total net income allocated to each security is determined by adding both distributed and undistributed net income for the period.
|
(i)
|
The net income allocated to each security is then divided by the weighted average number of outstanding shares for the period to which the earnings are allocated to determine the EPS for each security considered in the two-class method.
|
1.
|
Organization and Significant Accounting Policies (Continued)
|
1.
|
Organization and Significant Accounting Policies (Continued)
|
Land improvements
|
2 – 25 years
|
Leasehold improvements
|
1 – 15 years
|
Buildings
|
40 years
|
Building improvements
|
5 – 30 years
|
Furniture and equipment
|
1 – 20 years
|
1.
|
Organization and Significant Accounting Policies (Continued)
|
Customer relationships
|
5 – 17 years
|
Non-compete agreements
|
1 – 15 years
|
Leasehold interests
|
1 – 15 years
|
Trademarks
|
1 year
|
1.
|
Organization and Significant Accounting Policies (Continued)
|
1.
|
Organization and Significant Accounting Policies (Continued)
|
1.
|
Organization and Significant Accounting Policies (Continued)
|
|
For the Year Ended December 31, 2016
|
|
For the Year Ended December 31, 2017
|
||||||||||||||||||||
|
As Reported
|
|
As Adjusted(1)
|
|
Adoption Impact
|
|
As Reported
|
|
As Adjusted(1)
|
|
Adoption Impact
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Consolidated Statements of Operations and Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net operating revenues
|
$
|
4,286,021
|
|
|
$
|
4,217,460
|
|
|
$
|
(68,561
|
)
|
|
$
|
4,443,603
|
|
|
$
|
4,365,245
|
|
|
$
|
(78,358
|
)
|
Bad debt expense
|
69,093
|
|
|
532
|
|
|
(68,561
|
)
|
|
79,491
|
|
|
1,133
|
|
|
(78,358
|
)
|
(1)
|
Bad debt expense is now included in cost of services on the consolidated statements of operations and comprehensive income.
|
|
For the Year Ended December 31, 2016
|
|
For the Year Ended December 31, 2017
|
||||||||||||||||||||
|
As Reported
|
|
As Adjusted
|
|
Adoption Impact
|
|
As Reported
|
|
As Adjusted
|
|
Adoption Impact
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Consolidated Statements of Cash Flows
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Provision for bad debts
|
$
|
69,093
|
|
|
$
|
532
|
|
|
$
|
(68,561
|
)
|
|
$
|
79,491
|
|
|
$
|
1,133
|
|
|
$
|
(78,358
|
)
|
Changes in accounts receivable
|
(39,320
|
)
|
|
29,241
|
|
|
68,561
|
|
|
(197,191
|
)
|
|
(118,833
|
)
|
|
78,358
|
|
|
December 31, 2017
|
||||||||||
|
As Reported
|
|
As Adjusted
|
|
Adoption Impact
|
||||||
|
(in thousands)
|
||||||||||
Consolidated Balance Sheets
|
|
|
|
|
|
||||||
Accounts receivable
|
$
|
767,276
|
|
|
$
|
691,732
|
|
|
$
|
(75,544
|
)
|
Allowance for doubtful accounts
|
75,544
|
|
|
—
|
|
|
(75,544
|
)
|
|||
Accounts receivable
|
$
|
691,732
|
|
|
$
|
691,732
|
|
|
$
|
—
|
|
2.
|
Acquisitions
|
Accounts receivable
|
$
|
68,934
|
|
Other current assets
|
10,810
|
|
|
Property and equipment
|
69,712
|
|
|
Identifiable intangible assets
|
140,406
|
|
|
Other assets
|
25,435
|
|
|
Goodwill
|
540,067
|
|
|
Total assets
|
855,364
|
|
|
Accounts payable and other current liabilities
|
49,925
|
|
|
Deferred income taxes and other long-term liabilities
|
51,851
|
|
|
Total liabilities
|
101,776
|
|
|
Consideration given
|
$
|
753,588
|
|
2.
|
Acquisitions (Continued)
|
|
Fair Value
|
|
Weighted Average
Amortization Period
|
||
|
(in thousands)
|
|
(in years)
|
||
Customer relationships
|
$
|
135,000
|
|
|
15 years
|
Trademark
|
5,000
|
|
|
1 year
|
|
Favorable leasehold interests
|
406
|
|
|
2.9 years
|
|
Identifiable intangible assets
|
$
|
140,406
|
|
|
|
Cash and cash equivalents
|
$
|
12,340
|
|
Identifiable tangible assets, excluding cash and cash equivalents
|
87,832
|
|
|
Identifiable intangible assets
|
32,484
|
|
|
Goodwill
|
343,187
|
|
|
Total assets
|
475,843
|
|
|
Total liabilities
|
54,685
|
|
|
Acquired non-controlling interests
|
2,514
|
|
|
Net assets acquired
|
418,644
|
|
|
Less: Cash and cash equivalents acquired
|
(12,340
|
)
|
|
Net cash paid
|
$
|
406,304
|
|
2.
|
Acquisitions (Continued)
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2017
|
|
2018
|
||||||
|
(in thousands, except per share amounts)
|
||||||||||
Net operating revenues
|
$
|
4,339,551
|
|
|
$
|
4,903,612
|
|
|
$
|
5,128,838
|
|
Net income attributable to the Company
|
113,590
|
|
|
170,689
|
|
|
140,488
|
|
3.
|
Variable Interest Entities
|
4.
|
Sale of Businesses
|
5.
|
Property and Equipment
|
|
December 31,
|
||||||
|
2017
|
|
2018
|
||||
|
(in thousands)
|
||||||
Land
|
$
|
77,077
|
|
|
$
|
87,358
|
|
Leasehold improvements
|
420,632
|
|
|
498,520
|
|
||
Buildings
|
414,704
|
|
|
481,375
|
|
||
Furniture and equipment
|
517,912
|
|
|
609,805
|
|
||
Construction-in-progress
|
112,930
|
|
|
67,333
|
|
||
Total property and equipment
|
1,543,255
|
|
|
1,744,391
|
|
||
Accumulated depreciation
|
(630,664
|
)
|
|
(764,581
|
)
|
||
Property and equipment, net
|
$
|
912,591
|
|
|
$
|
979,810
|
|
6.
|
Intangible Assets
|
|
Critical Illness Recovery Hospital(1)
|
|
Rehabilitation Hospital(1)
|
|
Specialty Hospitals
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Balance as of January 1, 2017
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,447,406
|
|
|
$
|
643,557
|
|
|
$
|
660,037
|
|
|
$
|
2,751,000
|
|
Acquired
|
—
|
|
|
12,887
|
|
|
797
|
|
|
3,797
|
|
|
14,505
|
|
|
31,986
|
|
||||||
Measurement period adjustment
|
—
|
|
|
—
|
|
|
(342
|
)
|
|
168
|
|
|
—
|
|
|
(174
|
)
|
||||||
Reorganization of reporting units
|
1,045,220
|
|
|
402,641
|
|
|
(1,447,861
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance as of December 31, 2017
|
$
|
1,045,220
|
|
|
$
|
415,528
|
|
|
$
|
—
|
|
|
$
|
647,522
|
|
|
$
|
674,542
|
|
|
$
|
2,782,812
|
|
Acquired
|
—
|
|
|
1,118
|
|
|
—
|
|
|
4,309
|
|
|
537,424
|
|
|
542,851
|
|
||||||
Measurement period adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,472
|
|
|
4,472
|
|
||||||
Sold
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,409
|
)
|
|
—
|
|
|
(9,409
|
)
|
||||||
Balance as of December 31, 2018
|
$
|
1,045,220
|
|
|
$
|
416,646
|
|
|
$
|
—
|
|
|
$
|
642,422
|
|
|
$
|
1,216,438
|
|
|
$
|
3,320,726
|
|
(1)
|
The critical illness recovery hospital reporting unit was previously referred to as the long term acute care reporting unit. The rehabilitation hospital reporting unit was previously referred to as the inpatient rehabilitation reporting unit.
|
|
December 31,
|
||||||||||||||||||||||
|
2017
|
|
2018
|
||||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Indefinite-lived intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Trademarks
|
$
|
166,698
|
|
|
$
|
—
|
|
|
$
|
166,698
|
|
|
$
|
166,698
|
|
|
$
|
—
|
|
|
$
|
166,698
|
|
Certificates of need
|
19,155
|
|
|
—
|
|
|
19,155
|
|
|
19,174
|
|
|
—
|
|
|
19,174
|
|
||||||
Accreditations
|
1,895
|
|
|
—
|
|
|
1,895
|
|
|
1,857
|
|
|
—
|
|
|
1,857
|
|
||||||
Finite-lived intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Trademarks
|
—
|
|
|
—
|
|
|
—
|
|
|
5,000
|
|
|
(4,583
|
)
|
|
417
|
|
||||||
Customer relationships
|
143,953
|
|
|
(38,281
|
)
|
|
105,672
|
|
|
280,710
|
|
|
(61,900
|
)
|
|
218,810
|
|
||||||
Favorable leasehold interests
|
13,295
|
|
|
(4,319
|
)
|
|
8,976
|
|
|
13,553
|
|
|
(6,064
|
)
|
|
7,489
|
|
||||||
Non-compete agreements
|
28,023
|
|
|
(3,900
|
)
|
|
24,123
|
|
|
29,400
|
|
|
(6,152
|
)
|
|
23,248
|
|
||||||
Total identifiable intangible assets
|
$
|
373,019
|
|
|
$
|
(46,500
|
)
|
|
$
|
326,519
|
|
|
$
|
516,392
|
|
|
$
|
(78,699
|
)
|
|
$
|
437,693
|
|
6.
|
Intangible Assets (Continued)
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Amortization expense
|
$
|
26,620
|
|
|
$
|
25,994
|
|
|
$
|
25,778
|
|
|
$
|
25,568
|
|
|
$
|
25,417
|
|
7.
|
Equity Method Investments
|
BIR JV, LLP
|
49.0
|
%
|
OHRH, LLC
|
49.0
|
%
|
GlobalRehab—Scottsdale, LLC
|
49.0
|
%
|
Rehabilitation Institute of Denton, LLC
|
50.0
|
%
|
ES Rehabilitation, LLC
|
49.0
|
%
|
Coastal Virginia Rehabilitation, LLC
|
49.0
|
%
|
BHSM Rehabilitation, LLC
|
49.0
|
%
|
|
|
December 31,
|
||||||
|
|
2017
|
|
2018
|
||||
|
|
(in thousands)
|
||||||
Current assets
|
|
$
|
102,908
|
|
|
$
|
125,435
|
|
Non-current assets
|
|
79,364
|
|
|
118,270
|
|
||
Total assets
|
|
$
|
182,272
|
|
|
$
|
243,705
|
|
Current liabilities
|
|
$
|
37,113
|
|
|
$
|
43,792
|
|
Non-current liabilities
|
|
13,751
|
|
|
16,338
|
|
||
Equity
|
|
131,408
|
|
|
183,575
|
|
||
Total liabilities and equity
|
|
$
|
182,272
|
|
|
$
|
243,705
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2016
|
|
2017
|
|
2018
|
||||||
|
|
(in thousands)
|
||||||||||
Revenues
|
|
$
|
320,078
|
|
|
$
|
336,349
|
|
|
$
|
393,034
|
|
Operating costs and expenses
|
|
274,952
|
|
|
289,224
|
|
|
342,603
|
|
|||
Net income
|
|
43,410
|
|
|
45,648
|
|
|
48,535
|
|
7.
|
Equity Method Investments (Continued)
|
8.
|
Insurance Risk Programs
|
9.
|
Long-Term Debt and Notes Payable
|
|
Principal Outstanding
|
|
Unamortized
Premium (Discount) |
|
Unamortized
Issuance Costs |
|
Carrying
Value |
|
|
Fair Value
|
||||||||||
Select:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
6.375% senior notes
|
$
|
710,000
|
|
|
$
|
550
|
|
|
$
|
(4,642
|
)
|
|
$
|
705,908
|
|
|
|
$
|
706,450
|
|
Credit facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Revolving facility
|
20,000
|
|
|
—
|
|
|
—
|
|
|
20,000
|
|
|
|
18,400
|
|
|||||
Term loan
|
1,129,875
|
|
|
(9,690
|
)
|
|
(9,321
|
)
|
|
1,110,864
|
|
|
|
1,076,206
|
|
|||||
Other
|
56,415
|
|
|
—
|
|
|
(484
|
)
|
|
55,931
|
|
|
|
55,931
|
|
|||||
Total Select debt
|
1,916,290
|
|
|
(9,140
|
)
|
|
(14,447
|
)
|
|
1,892,703
|
|
|
|
1,856,987
|
|
|||||
Concentra:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Credit facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Term loans
|
1,414,175
|
|
|
(2,765
|
)
|
|
(18,648
|
)
|
|
1,392,762
|
|
|
|
1,357,802
|
|
|||||
Other
|
7,916
|
|
|
—
|
|
|
—
|
|
|
7,916
|
|
|
|
7,916
|
|
|||||
Total Concentra debt
|
1,422,091
|
|
|
(2,765
|
)
|
|
(18,648
|
)
|
|
1,400,678
|
|
|
|
1,365,718
|
|
|||||
Total debt
|
$
|
3,338,381
|
|
|
$
|
(11,905
|
)
|
|
$
|
(33,095
|
)
|
|
$
|
3,293,381
|
|
|
|
$
|
3,222,705
|
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
|
Total
|
||||||||||||||
Select:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
6.375% senior notes
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
710,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
710,000
|
|
Credit facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revolving facility
|
—
|
|
|
—
|
|
|
—
|
|
|
20,000
|
|
|
—
|
|
|
—
|
|
|
20,000
|
|
|||||||
Term loan
|
—
|
|
|
—
|
|
|
—
|
|
|
98,812
|
|
|
—
|
|
|
1,031,063
|
|
|
1,129,875
|
|
|||||||
Other
|
6,612
|
|
|
25,706
|
|
|
221
|
|
|
—
|
|
|
—
|
|
|
23,876
|
|
|
56,415
|
|
|||||||
Total Select debt
|
6,612
|
|
|
25,706
|
|
|
710,221
|
|
|
118,812
|
|
|
—
|
|
|
1,054,939
|
|
|
1,916,290
|
|
|||||||
Concentra:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Credit facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Term loans
|
33,878
|
|
|
—
|
|
|
—
|
|
|
1,140,297
|
|
|
240,000
|
|
|
—
|
|
|
1,414,175
|
|
|||||||
Other
|
3,375
|
|
|
346
|
|
|
346
|
|
|
349
|
|
|
335
|
|
|
3,165
|
|
|
7,916
|
|
|||||||
Total Concentra debt
|
37,253
|
|
|
346
|
|
|
346
|
|
|
1,140,646
|
|
|
240,335
|
|
|
3,165
|
|
|
1,422,091
|
|
|||||||
Total debt
|
$
|
43,865
|
|
|
$
|
26,052
|
|
|
$
|
710,567
|
|
|
$
|
1,259,458
|
|
|
$
|
240,335
|
|
|
$
|
1,058,104
|
|
|
$
|
3,338,381
|
|
9.
|
Long-Term Debt and Notes Payable (Continued)
|
|
Principal Outstanding
|
|
Unamortized
Premium (Discount)
|
|
Unamortized
Issuance
Costs
|
|
Carrying
Value
|
|
|
Fair Value
|
||||||||||
Select:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
6.375% senior notes
|
$
|
710,000
|
|
|
$
|
778
|
|
|
$
|
(6,553
|
)
|
|
$
|
704,225
|
|
|
|
$
|
727,750
|
|
Credit facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Revolving facility
|
230,000
|
|
|
—
|
|
|
—
|
|
|
230,000
|
|
|
|
211,600
|
|
|||||
Term loan
|
1,141,375
|
|
|
(12,445
|
)
|
|
(12,500
|
)
|
|
1,116,430
|
|
|
|
1,154,215
|
|
|||||
Other
|
36,877
|
|
|
—
|
|
|
(533
|
)
|
|
36,344
|
|
|
|
36,344
|
|
|||||
Total Select debt
|
2,118,252
|
|
|
(11,667
|
)
|
|
(19,586
|
)
|
|
2,086,999
|
|
|
|
2,129,909
|
|
|||||
Concentra:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Credit facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Term loan
|
619,175
|
|
|
(2,257
|
)
|
|
(10,668
|
)
|
|
606,250
|
|
|
|
625,173
|
|
|||||
Other
|
6,653
|
|
|
—
|
|
|
—
|
|
|
6,653
|
|
|
|
6,653
|
|
|||||
Total Concentra debt
|
625,828
|
|
|
(2,257
|
)
|
|
(10,668
|
)
|
|
612,903
|
|
|
|
631,826
|
|
|||||
Total debt
|
$
|
2,744,080
|
|
|
$
|
(13,924
|
)
|
|
$
|
(30,254
|
)
|
|
$
|
2,699,902
|
|
|
|
$
|
2,761,735
|
|
9.
|
Long-Term Debt and Notes Payable (Continued)
|
9.
|
Long-Term Debt and Notes Payable (Continued)
|
Year
|
Redemption Price
|
|
2018
|
101.594
|
%
|
2019 and thereafter
|
100.000
|
%
|
9.
|
Long-Term Debt and Notes Payable (Continued)
|
9.
|
Long-Term Debt and Notes Payable (Continued)
|
9.
|
Long-Term Debt and Notes Payable (Continued)
|
10.
|
Stockholders’ Equity
|
|
For the Year Ended December 31,
|
|||||||
|
2016
|
|
2017
|
|
2018
|
|||
|
(in thousands)
|
|||||||
Restricted stock granted
|
1,426
|
|
|
1,598
|
|
|
1,491
|
|
Common stock issued through stock option exercise
|
202
|
|
|
227
|
|
|
185
|
|
Unvested restricted stock forfeitures
|
82
|
|
|
27
|
|
|
168
|
|
Stock repurchases for satisfaction of tax obligations
|
232
|
|
|
280
|
|
|
357
|
|
11.
|
Segment Information
|
|
For the Year Ended December 31, 2016
|
||||||||||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation(4)
|
|
Concentra
|
|
Other
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Net operating revenues(1)
|
$
|
1,756,961
|
|
|
$
|
498,100
|
|
|
$
|
979,363
|
|
|
$
|
982,495
|
|
|
$
|
541
|
|
|
$
|
4,217,460
|
|
Adjusted EBITDA
|
224,609
|
|
|
56,902
|
|
|
129,830
|
|
|
143,009
|
|
|
(88,543
|
)
|
|
465,807
|
|
||||||
Total assets(2)(3)
|
1,910,013
|
|
|
621,105
|
|
|
969,014
|
|
|
1,313,176
|
|
|
107,318
|
|
|
4,920,626
|
|
||||||
Capital expenditures
|
48,626
|
|
|
60,513
|
|
|
21,286
|
|
|
15,946
|
|
|
15,262
|
|
|
161,633
|
|
11.
|
Segment Information (Continued)
|
|
For the Year Ended December 31, 2017
|
||||||||||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
|
Other
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Net operating revenues(1)
|
$
|
1,725,022
|
|
|
$
|
622,469
|
|
|
$
|
1,003,830
|
|
|
$
|
1,013,224
|
|
|
$
|
700
|
|
|
$
|
4,365,245
|
|
Adjusted EBITDA
|
252,679
|
|
|
90,041
|
|
|
132,533
|
|
|
157,561
|
|
|
(94,822
|
)
|
|
537,992
|
|
||||||
Total assets(3)
|
1,848,783
|
|
|
868,517
|
|
|
954,661
|
|
|
1,340,919
|
|
|
114,286
|
|
|
5,127,166
|
|
||||||
Capital expenditures
|
49,720
|
|
|
96,477
|
|
|
27,721
|
|
|
28,912
|
|
|
30,413
|
|
|
233,243
|
|
|
For the Year Ended December 31, 2018
|
||||||||||||||||||||||
|
Critical Illness Recovery Hospitals
|
|
Rehabilitation Hospitals
|
|
Outpatient
Rehabilitation
|
|
Concentra(5)
|
|
Other
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Net operating revenues(1)
|
$
|
1,753,584
|
|
|
$
|
707,514
|
|
|
$
|
1,062,487
|
|
|
$
|
1,557,673
|
|
|
$
|
—
|
|
|
$
|
5,081,258
|
|
Adjusted EBITDA
|
243,015
|
|
|
108,927
|
|
|
142,005
|
|
|
251,977
|
|
|
(100,769
|
)
|
|
645,155
|
|
||||||
Total assets(3)
|
1,771,605
|
|
|
894,192
|
|
|
1,002,819
|
|
|
2,178,868
|
|
|
116,781
|
|
|
5,964,265
|
|
||||||
Capital expenditures
|
40,855
|
|
|
42,389
|
|
|
30,553
|
|
|
42,205
|
|
|
11,279
|
|
|
167,281
|
|
|
For the Year Ended December 31, 2016
|
||||||||||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation(4)
|
|
Concentra
|
|
Other
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Adjusted EBITDA
|
$
|
224,609
|
|
|
$
|
56,902
|
|
|
$
|
129,830
|
|
|
$
|
143,009
|
|
|
$
|
(88,543
|
)
|
|
|
|
|
Depreciation and amortization
|
(43,862
|
)
|
|
(12,723
|
)
|
|
(22,661
|
)
|
|
(60,717
|
)
|
|
(5,348
|
)
|
|
|
|
||||||
Stock compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(770
|
)
|
|
(16,643
|
)
|
|
|
|
||||||
Physiotherapy acquisition costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,236
|
)
|
|
|
|||||||
Income (loss) from operations
|
$
|
180,747
|
|
|
$
|
44,179
|
|
|
$
|
107,169
|
|
|
$
|
81,522
|
|
|
$
|
(113,770
|
)
|
|
$
|
299,847
|
|
Loss on early retirement of debt
|
|
|
|
|
|
|
|
|
|
|
(11,626
|
)
|
|||||||||||
Equity in earnings of unconsolidated subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,943
|
|
|||||||
Non-operating gain
|
|
|
|
|
|
|
|
|
|
|
42,651
|
|
|||||||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(170,081
|
)
|
|||||||
Income before income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
180,734
|
|
11.
|
Segment Information (Continued)
|
|
For the Year Ended December 31, 2017
|
||||||||||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
|
Other
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Adjusted EBITDA
|
$
|
252,679
|
|
|
$
|
90,041
|
|
|
$
|
132,533
|
|
|
$
|
157,561
|
|
|
$
|
(94,822
|
)
|
|
|
|
|
Depreciation and amortization
|
(45,743
|
)
|
|
(20,176
|
)
|
|
(24,607
|
)
|
|
(61,945
|
)
|
|
(7,540
|
)
|
|
|
|
||||||
Stock compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(993
|
)
|
|
(18,291
|
)
|
|
|
|
||||||
U.S. HealthWorks acquisition costs
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,819
|
)
|
|
—
|
|
|
|
|
||||||
Income (loss) from operations
|
$
|
206,936
|
|
|
$
|
69,865
|
|
|
$
|
107,926
|
|
|
$
|
91,804
|
|
|
$
|
(120,653
|
)
|
|
$
|
355,878
|
|
Loss on early retirement of debt
|
|
|
|
|
|
|
|
|
|
|
(19,719
|
)
|
|||||||||||
Equity in earnings of unconsolidated subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21,054
|
|
|||||||
Non-operating loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(49
|
)
|
|||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(154,703
|
)
|
|||||||
Income before income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
202,461
|
|
|
For the Year Ended December 31, 2018
|
||||||||||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra(5)
|
|
Other
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Adjusted EBITDA
|
$
|
243,015
|
|
|
$
|
108,927
|
|
|
$
|
142,005
|
|
|
$
|
251,977
|
|
|
$
|
(100,769
|
)
|
|
|
|
|
Depreciation and amortization
|
(45,797
|
)
|
|
(24,101
|
)
|
|
(27,195
|
)
|
|
(95,521
|
)
|
|
(9,041
|
)
|
|
|
|
||||||
Stock compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,883
|
)
|
|
(20,443
|
)
|
|
|
|
||||||
U.S. HealthWorks acquisition costs
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,895
|
)
|
|
—
|
|
|
|
|
||||||
Income (loss) from operations
|
$
|
197,218
|
|
|
$
|
84,826
|
|
|
$
|
114,810
|
|
|
$
|
150,678
|
|
|
$
|
(130,253
|
)
|
|
$
|
417,279
|
|
Loss on early retirement of debt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(14,155
|
)
|
|||||||
Equity in earnings of unconsolidated subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21,905
|
|
|||||||
Non-operating gain
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,016
|
|
|||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(198,493
|
)
|
|||||||
Income before income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
235,552
|
|
(1)
|
Net operating revenues were retrospectively conformed to reflect the adoption of Topic 606, Revenue from Contracts with Customers.
|
(2)
|
Total assets were retrospectively conformed to reflect the adoption of ASU 2015-17, Balance Sheet Classification of Deferred Taxes, which resulted in a reduction to total assets of $23.8 million.
|
(3)
|
The critical illness recovery hospital segment includes $24.4 million, $9.8 million, and $9.8 million in real estate assets held for sale on December 31, 2016, 2017, and 2018, respectively.
|
(4)
|
The outpatient rehabilitation segment includes the operating results of the Company’s contract therapy businesses through March 31, 2016 and Physiotherapy beginning March 4, 2016.
|
(5)
|
The Concentra segment includes the operating results of U.S. HealthWorks beginning February 1, 2018.
|
12.
|
Revenue from Contracts with Customers
|
|
For the Year Ended December 31, 2016
|
||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
||||||||
|
(in thousands)
|
||||||||||||||
Patient service revenues:
|
|
|
|
|
|
|
|
||||||||
Medicare
|
$
|
936,083
|
|
|
$
|
191,037
|
|
|
$
|
136,283
|
|
|
$
|
2,235
|
|
Non-Medicare
|
797,431
|
|
|
161,821
|
|
|
739,102
|
|
|
969,682
|
|
||||
Total patient services revenues
|
1,733,514
|
|
|
352,858
|
|
|
875,385
|
|
|
971,917
|
|
||||
Other revenues
|
23,447
|
|
|
145,242
|
|
|
103,978
|
|
|
10,578
|
|
||||
Total net operating revenues
|
$
|
1,756,961
|
|
|
$
|
498,100
|
|
|
$
|
979,363
|
|
|
$
|
982,495
|
|
|
For the Year Ended December 31, 2017
|
||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
||||||||
|
(in thousands)
|
||||||||||||||
Patient service revenues:
|
|
|
|
|
|
|
|
||||||||
Medicare
|
$
|
903,503
|
|
|
$
|
259,221
|
|
|
$
|
148,403
|
|
|
$
|
2,128
|
|
Non-Medicare
|
810,723
|
|
|
207,196
|
|
|
739,531
|
|
|
1,002,787
|
|
||||
Total patient services revenues
|
1,714,226
|
|
|
466,417
|
|
|
887,934
|
|
|
1,004,915
|
|
||||
Other revenues
|
10,796
|
|
|
156,052
|
|
|
115,896
|
|
|
8,309
|
|
||||
Total net operating revenues
|
$
|
1,725,022
|
|
|
$
|
622,469
|
|
|
$
|
1,003,830
|
|
|
$
|
1,013,224
|
|
|
For the Year Ended December 31, 2018
|
||||||||||||||
|
Critical Illness Recovery Hospital
|
|
Rehabilitation Hospital
|
|
Outpatient
Rehabilitation
|
|
Concentra
|
||||||||
|
(in thousands)
|
||||||||||||||
Patient service revenues:
|
|
|
|
|
|
|
|
||||||||
Medicare
|
$
|
893,429
|
|
|
$
|
293,913
|
|
|
$
|
161,054
|
|
|
$
|
2,168
|
|
Non-Medicare
|
847,447
|
|
|
254,215
|
|
|
762,247
|
|
|
1,545,852
|
|
||||
Total patient services revenues
|
1,740,876
|
|
|
548,128
|
|
|
923,301
|
|
|
1,548,020
|
|
||||
Other revenues
|
12,708
|
|
|
159,386
|
|
|
139,186
|
|
|
9,653
|
|
||||
Total net operating revenues
|
$
|
1,753,584
|
|
|
$
|
707,514
|
|
|
$
|
1,062,487
|
|
|
$
|
1,557,673
|
|
13.
|
Stock-based Compensation
|
13.
|
Stock-based Compensation (Continued)
|
|
Shares
|
|
Weighted Average
Grant Date
Fair Value
|
|||
|
(share amounts in thousands)
|
|||||
Unvested balance, January 1, 2018
|
4,468
|
|
|
$
|
13.85
|
|
Granted
|
1,491
|
|
|
19.72
|
|
|
Vested
|
(1,341
|
)
|
|
14.22
|
|
|
Forfeited
|
(168
|
)
|
|
14.47
|
|
|
Unvested balance, December 31, 2018
|
4,450
|
|
|
$
|
15.68
|
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2017
|
|
2018
|
||||||
|
(in thousands)
|
||||||||||
Stock compensation expense:
|
|
|
|
|
|
|
|
|
|||
Included in general and administrative
|
$
|
14,607
|
|
|
$
|
15,706
|
|
|
$
|
17,604
|
|
Included in cost of services
|
2,806
|
|
|
3,578
|
|
|
5,722
|
|
|||
Total
|
$
|
17,413
|
|
|
$
|
19,284
|
|
|
$
|
23,326
|
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Stock compensation expense
|
$
|
22,998
|
|
|
$
|
16,566
|
|
|
$
|
8,976
|
|
|
$
|
3,302
|
|
|
$
|
213
|
|
14.
|
Income Taxes
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2017
|
|
2018
|
||||||
|
(in thousands)
|
||||||||||
Current income tax expense:
|
|
|
|
|
|
|
|
|
|||
Federal
|
$
|
54,726
|
|
|
$
|
45,809
|
|
|
$
|
36,072
|
|
State and local
|
13,329
|
|
|
8,331
|
|
|
15,321
|
|
|||
Total current income tax expense
|
68,055
|
|
|
54,140
|
|
|
51,393
|
|
|||
Deferred income tax expense (benefit)
|
(12,591
|
)
|
|
(72,324
|
)
|
|
7,217
|
|
|||
Total income tax expense (benefit)
|
$
|
55,464
|
|
|
$
|
(18,184
|
)
|
|
$
|
58,610
|
|
|
For the Year Ended December 31,
|
|||||||
|
2016
|
|
2017
|
|
2018
|
|||
Federal income tax at statutory rate
|
35.0
|
%
|
|
35.0
|
%
|
|
21.0
|
%
|
State and local income taxes, less federal income tax benefit
|
3.6
|
|
|
3.7
|
|
|
5.0
|
|
Permanent differences
|
1.4
|
|
|
1.7
|
|
|
2.1
|
|
Tax benefit from the sale of businesses
|
(6.7
|
)
|
|
—
|
|
|
—
|
|
Valuation allowance
|
0.2
|
|
|
(7.3
|
)
|
|
0.5
|
|
Uncertain tax positions
|
(1.3
|
)
|
|
(0.6
|
)
|
|
(0.8
|
)
|
Non-controlling interest
|
(0.5
|
)
|
|
0.5
|
|
|
(2.1
|
)
|
Stock-based compensation
|
(0.7
|
)
|
|
(1.3
|
)
|
|
(2.2
|
)
|
Deferred income taxes - state income tax rate adjustment
|
—
|
|
|
(2.8
|
)
|
|
0.4
|
|
Deferred income taxes - tax legislation rate adjustment
|
—
|
|
|
(37.5
|
)
|
|
—
|
|
Other
|
(0.3
|
)
|
|
(0.4
|
)
|
|
1.0
|
|
Total effective income tax rate
|
30.7
|
%
|
|
(9.0
|
)%
|
|
24.9
|
%
|
14.
|
Income Taxes (Continued)
|
|
December 31,
|
||||||
|
2017
|
|
2018
|
||||
|
(in thousands)
|
||||||
Deferred tax assets
|
|
|
|
|
|
||
Allowance for doubtful accounts
|
$
|
8,792
|
|
|
$
|
10,313
|
|
Compensation and benefit-related accruals
|
50,936
|
|
|
51,900
|
|
||
Professional malpractice liability insurance
|
11,036
|
|
|
13,644
|
|
||
Deferred revenue
|
319
|
|
|
209
|
|
||
Federal and state net operating loss and state tax credit carryforwards
|
36,112
|
|
|
40,163
|
|
||
Interest limitation carryforward
|
—
|
|
|
4,675
|
|
||
Stock awards
|
6,591
|
|
|
5,695
|
|
||
Equity investments
|
1,452
|
|
|
2,055
|
|
||
Other
|
3,543
|
|
|
3,271
|
|
||
Deferred tax assets
|
$
|
118,781
|
|
|
$
|
131,925
|
|
Valuation allowance
|
(12,986
|
)
|
|
(17,893
|
)
|
||
Deferred tax assets, net of valuation allowance
|
$
|
105,795
|
|
|
$
|
114,032
|
|
Deferred tax liabilities
|
|
|
|
|
|
||
Deferred income
|
$
|
(19,608
|
)
|
|
$
|
(13,891
|
)
|
Investment in unconsolidated affiliates
|
(4,457
|
)
|
|
(5,653
|
)
|
||
Depreciation and amortization
|
(179,055
|
)
|
|
(217,950
|
)
|
||
Deferred financing costs
|
(4,528
|
)
|
|
(8,324
|
)
|
||
Other
|
(3,673
|
)
|
|
(3,488
|
)
|
||
Deferred tax liabilities
|
$
|
(211,321
|
)
|
|
$
|
(249,306
|
)
|
Deferred tax liabilities, net of deferred tax assets
|
$
|
(105,526
|
)
|
|
$
|
(135,274
|
)
|
|
December 31,
|
||||||
|
2017
|
|
2018
|
||||
|
(in thousands)
|
||||||
Other assets
|
$
|
19,391
|
|
|
$
|
18,621
|
|
Non-current deferred tax liability
|
(124,917
|
)
|
|
(153,895
|
)
|
||
|
$
|
(105,526
|
)
|
|
$
|
(135,274
|
)
|
14.
|
Income Taxes (Continued)
|
|
State Net Operating Losses
|
|
Gross Valuation Allowance
|
||||
|
(in thousands)
|
||||||
2019
|
$
|
11,508
|
|
|
$
|
5,830
|
|
2020
|
16,798
|
|
|
14,619
|
|
||
2021
|
12,103
|
|
|
11,395
|
|
||
2022
|
36,556
|
|
|
35,564
|
|
||
Thereafter through 2037
|
621,161
|
|
|
447,368
|
|
15.
|
Retirement Savings Plan
|
16.
|
Earnings per Share
|
|
|
Basic EPS
|
|
Diluted EPS
|
|
||||||||||||||||||||
|
|
For the Year Ended December 31,
|
|
For the Year Ended December 31,
|
|
||||||||||||||||||||
|
|
2016
|
|
2017
|
|
2018
|
|
2016
|
|
2017
|
|
2018
|
|
||||||||||||
|
|
(in thousands)
|
|
||||||||||||||||||||||
Net income
|
|
$
|
125,270
|
|
|
$
|
220,645
|
|
|
$
|
176,942
|
|
|
$
|
125,270
|
|
|
$
|
220,645
|
|
|
$
|
176,942
|
|
|
Less: net income attributable to non-controlling interests
|
|
9,859
|
|
|
43,461
|
|
|
39,102
|
|
|
9,859
|
|
|
43,461
|
|
|
39,102
|
|
|
||||||
Net income attributable to the Company
|
|
115,411
|
|
|
177,184
|
|
|
137,840
|
|
|
115,411
|
|
|
177,184
|
|
|
137,840
|
|
|
||||||
Less: net income attributable to participating securities
|
|
3,521
|
|
|
5,758
|
|
|
4,551
|
|
|
3,517
|
|
|
5,751
|
|
|
4,548
|
|
|
||||||
Net income attributable to common shares
|
|
$
|
111,890
|
|
|
$
|
171,426
|
|
|
$
|
133,289
|
|
|
$
|
111,894
|
|
|
$
|
171,433
|
|
|
$
|
133,292
|
|
|
16.
|
Earnings per Share (Continued)
|
|
|
For the Year Ended December 31, 2018
|
|||||||||||||||||||||
|
|
Net Income Allocation
|
|
Shares(1)
|
|
Basic EPS
|
|
|
Net Income Allocation
|
|
Shares(1)
|
|
Diluted EPS
|
||||||||||
|
|
(in thousands, except for per share amounts)
|
|||||||||||||||||||||
Common shares
|
|
$
|
133,289
|
|
|
130,172
|
|
|
$
|
1.02
|
|
|
|
$
|
133,292
|
|
|
130,256
|
|
|
$
|
1.02
|
|
Participating securities
|
|
4,551
|
|
|
4,444
|
|
|
$
|
1.02
|
|
|
|
4,548
|
|
|
4,444
|
|
|
$
|
1.02
|
|
||
Total Company
|
|
$
|
137,840
|
|
|
|
|
|
|
|
$
|
137,840
|
|
|
|
|
|
|
|
For the Year Ended December 31, 2017
|
|||||||||||||||||||||
|
|
Net Income Allocation
|
|
Shares(1)
|
|
Basic EPS
|
|
|
Net Income Allocation
|
|
Shares(1)
|
|
Diluted EPS
|
||||||||||
|
|
(in thousands, except for per share amounts)
|
|||||||||||||||||||||
Common shares
|
|
$
|
171,426
|
|
|
128,955
|
|
|
$
|
1.33
|
|
|
|
$
|
171,433
|
|
|
129,126
|
|
|
$
|
1.33
|
|
Participating securities
|
|
5,758
|
|
|
4,332
|
|
|
$
|
1.33
|
|
|
|
5,751
|
|
|
4,332
|
|
|
$
|
1.33
|
|
||
Total Company
|
|
$
|
177,184
|
|
|
|
|
|
|
|
$
|
177,184
|
|
|
|
|
|
|
|
For the Year Ended December 31, 2016
|
|||||||||||||||||||||
|
|
Net Income Allocation
|
|
Shares(1)
|
|
Basic EPS
|
|
|
Net Income Allocation
|
|
Shares(1)
|
|
Diluted EPS
|
||||||||||
|
|
(in thousands, except for per share amounts)
|
|||||||||||||||||||||
Common shares
|
|
$
|
111,890
|
|
|
127,813
|
|
|
$
|
0.88
|
|
|
|
$
|
111,894
|
|
|
127,968
|
|
|
$
|
0.87
|
|
Participating securities
|
|
3,521
|
|
|
4,022
|
|
|
$
|
0.88
|
|
|
|
3,517
|
|
|
4,022
|
|
|
$
|
0.87
|
|
||
Total Company
|
|
$
|
115,411
|
|
|
|
|
|
|
|
$
|
115,411
|
|
|
|
|
|
17.
|
Commitments and Contingencies
|
2019
|
$
|
261,915
|
|
2020
|
224,306
|
|
|
2021
|
185,587
|
|
|
2022
|
142,655
|
|
|
2023
|
104,866
|
|
|
Thereafter
|
470,694
|
|
|
|
$
|
1,390,023
|
|
2019
|
$
|
5,931
|
|
2020
|
7,405
|
|
|
2021
|
7,568
|
|
|
2022
|
7,500
|
|
|
2023
|
2,893
|
|
|
Thereafter
|
13,344
|
|
|
|
$
|
44,641
|
|
17.
|
Commitments and Contingencies (Continued)
|
17.
|
Commitments and Contingencies (Continued)
|
17.
|
Commitments and Contingencies (Continued)
|
18.
|
Financial Information for Subsidiary Guarantors and Non-Guarantor Subsidiaries under Select’s 6.375% Senior Notes
|
18.
|
Financial Information for Subsidiary Guarantors and Non-Guarantor Subsidiaries under Select’s 6.375% Senior Notes (Continued)
|
|
Select
(Parent
Company Only)
|
|
Subsidiary
Guarantors
|
|
Non-Guarantor
Subsidiaries
|
|
Non-Guarantor
Concentra
|
|
Consolidating and Eliminating Adjustments
|
|
Consolidated
Select
Medical
Corporation
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
77
|
|
|
$
|
7,574
|
|
|
$
|
4,411
|
|
|
$
|
163,116
|
|
|
$
|
—
|
|
|
$
|
175,178
|
|
Accounts receivable
|
—
|
|
|
397,674
|
|
|
118,683
|
|
|
190,319
|
|
|
—
|
|
|
706,676
|
|
||||||
Intercompany receivables
|
—
|
|
|
1,787,184
|
|
|
83,230
|
|
|
—
|
|
|
(1,870,414
|
)
|
(a)
|
—
|
|
||||||
Prepaid income taxes
|
10,205
|
|
|
5,711
|
|
|
—
|
|
|
4,623
|
|
|
—
|
|
|
20,539
|
|
||||||
Other current assets
|
17,866
|
|
|
31,181
|
|
|
14,048
|
|
|
27,036
|
|
|
—
|
|
|
90,131
|
|
||||||
Total Current Assets
|
28,148
|
|
|
2,229,324
|
|
|
220,372
|
|
|
385,094
|
|
|
(1,870,414
|
)
|
|
992,524
|
|
||||||
Property and equipment, net
|
30,103
|
|
|
625,947
|
|
|
103,006
|
|
|
220,754
|
|
|
—
|
|
|
979,810
|
|
||||||
Investment in affiliates
|
4,497,167
|
|
|
127,036
|
|
|
—
|
|
|
—
|
|
|
(4,624,203
|
)
|
(b)(c)
|
—
|
|
||||||
Goodwill
|
—
|
|
|
2,104,288
|
|
|
—
|
|
|
1,216,438
|
|
|
—
|
|
|
3,320,726
|
|
||||||
Identifiable intangible assets, net
|
3
|
|
|
102,120
|
|
|
5,020
|
|
|
330,550
|
|
|
—
|
|
|
437,693
|
|
||||||
Other assets
|
37,281
|
|
|
145,467
|
|
|
33,417
|
|
|
26,032
|
|
|
(8,685
|
)
|
(e)
|
233,512
|
|
||||||
Total Assets
|
$
|
4,592,702
|
|
|
$
|
5,334,182
|
|
|
$
|
361,815
|
|
|
$
|
2,178,868
|
|
|
$
|
(6,503,302
|
)
|
|
$
|
5,964,265
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Overdrafts
|
$
|
25,083
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
25,083
|
|
Current portion of long-term debt and notes payable
|
4,363
|
|
|
248
|
|
|
2,001
|
|
|
37,253
|
|
|
—
|
|
|
43,865
|
|
||||||
Accounts payable
|
14,033
|
|
|
84,343
|
|
|
20,956
|
|
|
27,361
|
|
|
—
|
|
|
146,693
|
|
||||||
Intercompany payables
|
1,787,184
|
|
|
83,230
|
|
|
—
|
|
|
—
|
|
|
(1,870,414
|
)
|
(a)
|
—
|
|
||||||
Accrued payroll
|
15,533
|
|
|
99,803
|
|
|
5,936
|
|
|
51,114
|
|
|
—
|
|
|
172,386
|
|
||||||
Accrued vacation
|
4,613
|
|
|
60,989
|
|
|
13,942
|
|
|
31,116
|
|
|
—
|
|
|
110,660
|
|
||||||
Accrued interest
|
5,996
|
|
|
22
|
|
|
3
|
|
|
6,116
|
|
|
—
|
|
|
12,137
|
|
||||||
Accrued other
|
60,056
|
|
|
61,226
|
|
|
17,098
|
|
|
52,311
|
|
|
—
|
|
|
190,691
|
|
||||||
Income taxes payable
|
—
|
|
|
2,366
|
|
|
190
|
|
|
1,115
|
|
|
—
|
|
|
3,671
|
|
||||||
Total Current Liabilities
|
1,916,861
|
|
|
392,227
|
|
|
60,126
|
|
|
206,386
|
|
|
(1,870,414
|
)
|
|
705,186
|
|
||||||
Long-term debt, net of current portion
|
1,837,241
|
|
|
448
|
|
|
48,402
|
|
|
1,363,425
|
|
|
—
|
|
|
3,249,516
|
|
||||||
Non-current deferred tax liability
|
—
|
|
|
101,214
|
|
|
994
|
|
|
60,372
|
|
|
(8,685
|
)
|
(e)
|
153,895
|
|
||||||
Other non-current liabilities
|
35,558
|
|
|
59,901
|
|
|
9,194
|
|
|
54,287
|
|
|
—
|
|
|
158,940
|
|
||||||
Total Liabilities
|
3,789,660
|
|
|
553,790
|
|
|
118,716
|
|
|
1,684,470
|
|
|
(1,879,099
|
)
|
|
4,267,537
|
|
||||||
Redeemable non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
18,525
|
|
|
761,963
|
|
(d)
|
780,488
|
|
||||||
Stockholders’ Equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Common stock
|
0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0
|
|
||||||
Capital in excess of par
|
970,156
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
970,156
|
|
||||||
Retained earnings (accumulated deficit)
|
(167,114
|
)
|
|
1,547,018
|
|
|
(29,553
|
)
|
|
12,355
|
|
|
(1,529,820
|
)
|
(c)(d)
|
(167,114
|
)
|
||||||
Subsidiary investment
|
—
|
|
|
3,233,374
|
|
|
272,652
|
|
|
457,974
|
|
|
(3,964,000
|
)
|
(b)(d)
|
—
|
|
||||||
Total Select Medical Corporation Stockholders’ Equity
|
803,042
|
|
|
4,780,392
|
|
|
243,099
|
|
|
470,329
|
|
|
(5,493,820
|
)
|
|
803,042
|
|
||||||
Non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
5,544
|
|
|
107,654
|
|
(d)
|
113,198
|
|
||||||
Total Equity
|
803,042
|
|
|
4,780,392
|
|
|
243,099
|
|
|
475,873
|
|
|
(5,386,166
|
)
|
|
916,240
|
|
||||||
Total Liabilities and Equity
|
$
|
4,592,702
|
|
|
$
|
5,334,182
|
|
|
$
|
361,815
|
|
|
$
|
2,178,868
|
|
|
$
|
(6,503,302
|
)
|
|
$
|
5,964,265
|
|
(a)
|
Elimination of intercompany balances.
|
(b)
|
Elimination of investments in consolidated subsidiaries.
|
(c)
|
Elimination of investments in consolidated subsidiaries’ earnings.
|
(d)
|
Reclassification of equity attributable to non-controlling interests.
|
(e)
|
Reclassification of non-current deferred tax asset to report net non-current deferred tax liability in consolidation.
|
18.
|
Financial Information for Subsidiary Guarantors and Non-Guarantor Subsidiaries under Select’s 6.375% Senior Notes (Continued)
|
|
Select
(Parent
Company Only)
|
|
Subsidiary
Guarantors
|
|
Non-Guarantor
Subsidiaries
|
|
Non-Guarantor
Concentra
|
|
Consolidating and Eliminating Adjustments
|
|
Consolidated
Select
Medical
Corporation
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Net operating revenues
|
$
|
—
|
|
|
$
|
2,755,745
|
|
|
$
|
767,840
|
|
|
$
|
1,557,673
|
|
|
$
|
—
|
|
|
$
|
5,081,258
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of services, exclusive of depreciation and amortization
|
2,838
|
|
|
2,376,111
|
|
|
653,528
|
|
|
1,308,579
|
|
|
—
|
|
|
4,341,056
|
|
||||||
General and administrative
|
118,128
|
|
|
245
|
|
|
—
|
|
|
2,895
|
|
|
—
|
|
|
121,268
|
|
||||||
Depreciation and amortization
|
8,913
|
|
|
80,422
|
|
|
16,799
|
|
|
95,521
|
|
|
—
|
|
|
201,655
|
|
||||||
Total costs and expenses
|
129,879
|
|
|
2,456,778
|
|
|
670,327
|
|
|
1,406,995
|
|
|
—
|
|
|
4,663,979
|
|
||||||
Income (loss) from operations
|
(129,879
|
)
|
|
298,967
|
|
|
97,513
|
|
|
150,678
|
|
|
—
|
|
|
417,279
|
|
||||||
Other income and expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Intercompany interest and royalty fees
|
28,058
|
|
|
(12,676
|
)
|
|
(14,187
|
)
|
|
(1,195
|
)
|
|
—
|
|
|
—
|
|
||||||
Intercompany management fees
|
211,861
|
|
|
(166,857
|
)
|
|
(45,004
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Loss on early retirement of debt
|
(4,654
|
)
|
|
—
|
|
|
—
|
|
|
(9,501
|
)
|
|
—
|
|
|
(14,155
|
)
|
||||||
Equity in earnings of unconsolidated subsidiaries
|
—
|
|
|
21,870
|
|
|
35
|
|
|
—
|
|
|
—
|
|
|
21,905
|
|
||||||
Non-operating gain
|
1,656
|
|
|
7,360
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,016
|
|
||||||
Interest income (expense)
|
(117,520
|
)
|
|
328
|
|
|
(736
|
)
|
|
(80,565
|
)
|
|
—
|
|
|
(198,493
|
)
|
||||||
Income (loss) before income taxes
|
(10,478
|
)
|
|
148,992
|
|
|
37,621
|
|
|
59,417
|
|
|
—
|
|
|
235,552
|
|
||||||
Income tax expense
|
3,419
|
|
|
42,713
|
|
|
553
|
|
|
11,925
|
|
|
—
|
|
|
58,610
|
|
||||||
Equity in earnings of consolidated subsidiaries
|
151,737
|
|
|
24,404
|
|
|
—
|
|
|
—
|
|
|
(176,141
|
)
|
(a)
|
—
|
|
||||||
Net income
|
137,840
|
|
|
130,683
|
|
|
37,068
|
|
|
47,492
|
|
|
(176,141
|
)
|
|
176,942
|
|
||||||
Less: Net income attributable to non-controlling interests
|
—
|
|
|
97
|
|
|
12,664
|
|
|
26,341
|
|
|
—
|
|
|
39,102
|
|
||||||
Net income attributable to Select Medical Corporation
|
$
|
137,840
|
|
|
$
|
130,586
|
|
|
$
|
24,404
|
|
|
$
|
21,151
|
|
|
$
|
(176,141
|
)
|
|
$
|
137,840
|
|
(a)
|
Elimination of equity in earnings of consolidated subsidiaries.
|
18.
|
Financial Information for Subsidiary Guarantors and Non-Guarantor Subsidiaries under Select’s 6.375% Senior Notes (Continued)
|
|
Select (Parent
Company Only)
|
|
Subsidiary
Guarantors
|
|
Non-Guarantor
Subsidiaries
|
|
Non-Guarantor
Concentra
|
|
Consolidating and Eliminating Adjustments
|
|
Consolidated
Select
Medical
Corporation
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net income
|
$
|
137,840
|
|
|
$
|
130,683
|
|
|
$
|
37,068
|
|
|
$
|
47,492
|
|
|
$
|
(176,141
|
)
|
(a)
|
$
|
176,942
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Distributions from unconsolidated subsidiaries
|
—
|
|
|
15,687
|
|
|
34
|
|
|
—
|
|
|
—
|
|
|
15,721
|
|
||||||
Depreciation and amortization
|
8,913
|
|
|
80,422
|
|
|
16,799
|
|
|
95,521
|
|
|
—
|
|
|
201,655
|
|
||||||
Provision for bad debts
|
—
|
|
|
(485
|
)
|
|
318
|
|
|
64
|
|
|
—
|
|
|
(103
|
)
|
||||||
Equity in earnings of unconsolidated subsidiaries
|
—
|
|
|
(21,870
|
)
|
|
(35
|
)
|
|
—
|
|
|
—
|
|
|
(21,905
|
)
|
||||||
Equity in earnings of consolidated subsidiaries
|
(151,737
|
)
|
|
(24,404
|
)
|
|
—
|
|
|
—
|
|
|
176,141
|
|
(a)
|
—
|
|
||||||
Loss on extinguishment of debt
|
1,955
|
|
|
—
|
|
|
—
|
|
|
1,044
|
|
|
—
|
|
|
2,999
|
|
||||||
Gain on sale of assets and businesses
|
(1,645
|
)
|
|
(7,507
|
)
|
|
(16
|
)
|
|
—
|
|
|
—
|
|
|
(9,168
|
)
|
||||||
Stock compensation expense
|
20,443
|
|
|
—
|
|
|
—
|
|
|
2,883
|
|
|
—
|
|
|
23,326
|
|
||||||
Amortization of debt discount, premium and issuance costs
|
5,740
|
|
|
—
|
|
|
—
|
|
|
7,372
|
|
|
—
|
|
|
13,112
|
|
||||||
Deferred income taxes
|
7,910
|
|
|
7,489
|
|
|
242
|
|
|
(8,424
|
)
|
|
—
|
|
|
7,217
|
|
||||||
Changes in operating assets and liabilities, net of effects of business combinations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Accounts receivable
|
—
|
|
|
52,786
|
|
|
3,727
|
|
|
(1,938
|
)
|
|
—
|
|
|
54,575
|
|
||||||
Other current assets
|
(4,845
|
)
|
|
(960
|
)
|
|
(1,017
|
)
|
|
2,670
|
|
|
—
|
|
|
(4,152
|
)
|
||||||
Other assets
|
(9,099
|
)
|
|
(9,053
|
)
|
|
2,068
|
|
|
23,941
|
|
|
—
|
|
|
7,857
|
|
||||||
Accounts payable
|
2,862
|
|
|
(2,447
|
)
|
|
2,519
|
|
|
(4,712
|
)
|
|
—
|
|
|
(1,778
|
)
|
||||||
Accrued expenses
|
21,096
|
|
|
14,697
|
|
|
8,863
|
|
|
(16,760
|
)
|
|
—
|
|
|
27,896
|
|
||||||
Net cash provided by operating activities
|
39,433
|
|
|
235,038
|
|
|
70,570
|
|
|
149,153
|
|
|
—
|
|
|
494,194
|
|
||||||
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Business combinations, net of cash acquired
|
—
|
|
|
(4,965
|
)
|
|
(204
|
)
|
|
(517,965
|
)
|
|
—
|
|
|
(523,134
|
)
|
||||||
Purchases of property and equipment
|
(9,719
|
)
|
|
(76,443
|
)
|
|
(38,914
|
)
|
|
(42,205
|
)
|
|
—
|
|
|
(167,281
|
)
|
||||||
Investment in businesses
|
—
|
|
|
(13,477
|
)
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(13,482
|
)
|
||||||
Proceeds from sale of assets and businesses
|
1,658
|
|
|
5,042
|
|
|
48
|
|
|
12
|
|
|
—
|
|
|
6,760
|
|
||||||
Net cash used in investing activities
|
(8,061
|
)
|
|
(89,843
|
)
|
|
(39,070
|
)
|
|
(560,163
|
)
|
|
—
|
|
|
(697,137
|
)
|
||||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Borrowings on revolving facilities
|
595,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
595,000
|
|
||||||
Payments on revolving facilities
|
(805,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(805,000
|
)
|
||||||
Proceeds from term loans
|
(62
|
)
|
|
—
|
|
|
—
|
|
|
779,885
|
|
|
—
|
|
|
779,823
|
|
||||||
Payments on term loans
|
(11,500
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,500
|
)
|
||||||
Revolving facility debt issuance costs
|
(1,090
|
)
|
|
—
|
|
|
—
|
|
|
(549
|
)
|
|
—
|
|
|
(1,639
|
)
|
||||||
Borrowings of other debt
|
7,457
|
|
|
—
|
|
|
30,202
|
|
|
4,559
|
|
|
—
|
|
|
42,218
|
|
||||||
Principal payments on other debt
|
(11,293
|
)
|
|
(621
|
)
|
|
(6,816
|
)
|
|
(6,512
|
)
|
|
—
|
|
|
(25,242
|
)
|
||||||
Dividends paid to Holdings
|
(6,837
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,837
|
)
|
||||||
Equity investment by Holdings
|
1,722
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,722
|
|
||||||
Intercompany
|
204,615
|
|
|
(140,406
|
)
|
|
(46,064
|
)
|
|
(18,145
|
)
|
|
—
|
|
|
—
|
|
||||||
Decrease in overdrafts
|
(4,380
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,380
|
)
|
||||||
Proceeds from issuance of non-controlling interests
|
—
|
|
|
—
|
|
|
957
|
|
|
1,969
|
|
|
—
|
|
|
2,926
|
|
||||||
Distributions to and purchases of non-controlling interests
|
—
|
|
|
(1,450
|
)
|
|
(9,929
|
)
|
|
(300,140
|
)
|
|
—
|
|
|
(311,519
|
)
|
||||||
Net cash provided by (used in) financing activities
|
(31,368
|
)
|
|
(142,477
|
)
|
|
(31,650
|
)
|
|
461,067
|
|
|
—
|
|
|
255,572
|
|
||||||
Net increase (decrease) in cash and cash equivalents
|
4
|
|
|
2,718
|
|
|
(150
|
)
|
|
50,057
|
|
|
—
|
|
|
52,629
|
|
||||||
Cash and cash equivalents at beginning of period
|
73
|
|
|
4,856
|
|
|
4,561
|
|
|
113,059
|
|
|
—
|
|
|
122,549
|
|
||||||
Cash and cash equivalents at end of period
|
$
|
77
|
|
|
$
|
7,574
|
|
|
$
|
4,411
|
|
|
$
|
163,116
|
|
|
$
|
—
|
|
|
$
|
175,178
|
|
(a)
|
Elimination of equity in earnings of consolidated subsidiaries.
|
18.
|
Financial Information for Subsidiary Guarantors and Non-Guarantor Subsidiaries under Select’s 6.375% Senior Notes (Continued)
|
|
Select
(Parent
Company Only)
|
|
Subsidiary
Guarantors
|
|
Non-Guarantor
Subsidiaries
|
|
Non-Guarantor
Concentra
|
|
Consolidating and Eliminating Adjustments
|
|
Consolidated
Select
Medical
Corporation
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
73
|
|
|
$
|
4,856
|
|
|
$
|
4,561
|
|
|
$
|
113,059
|
|
|
$
|
—
|
|
|
$
|
122,549
|
|
Accounts receivable
|
—
|
|
|
449,493
|
|
|
122,728
|
|
|
119,511
|
|
|
—
|
|
|
691,732
|
|
||||||
Intercompany receivables
|
—
|
|
|
1,598,212
|
|
|
60,707
|
|
|
—
|
|
|
(1,658,919
|
)
|
(a)
|
—
|
|
||||||
Prepaid income taxes
|
22,704
|
|
|
5,703
|
|
|
31
|
|
|
2,949
|
|
|
—
|
|
|
31,387
|
|
||||||
Other current assets
|
13,021
|
|
|
30,209
|
|
|
13,031
|
|
|
18,897
|
|
|
—
|
|
|
75,158
|
|
||||||
Total Current Assets
|
35,798
|
|
|
2,088,473
|
|
|
201,058
|
|
|
254,416
|
|
|
(1,658,919
|
)
|
|
920,826
|
|
||||||
Property and equipment, net
|
39,836
|
|
|
623,085
|
|
|
79,013
|
|
|
170,657
|
|
|
—
|
|
|
912,591
|
|
||||||
Investment in affiliates
|
4,524,385
|
|
|
124,104
|
|
|
—
|
|
|
—
|
|
|
(4,648,489
|
)
|
(b)(c)
|
—
|
|
||||||
Goodwill
|
—
|
|
|
2,108,270
|
|
|
—
|
|
|
674,542
|
|
|
—
|
|
|
2,782,812
|
|
||||||
Identifiable intangible assets, net
|
—
|
|
|
104,067
|
|
|
5,046
|
|
|
217,406
|
|
|
—
|
|
|
326,519
|
|
||||||
Other assets
|
36,494
|
|
|
98,575
|
|
|
35,440
|
|
|
23,898
|
|
|
(9,989
|
)
|
(e)
|
184,418
|
|
||||||
Total Assets
|
$
|
4,636,513
|
|
|
$
|
5,146,574
|
|
|
$
|
320,557
|
|
|
$
|
1,340,919
|
|
|
$
|
(6,317,397
|
)
|
|
$
|
5,127,166
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Overdrafts
|
$
|
29,463
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
29,463
|
|
Current portion of long-term debt and notes payable
|
16,635
|
|
|
740
|
|
|
2,212
|
|
|
2,600
|
|
|
—
|
|
|
22,187
|
|
||||||
Accounts payable
|
12,504
|
|
|
85,489
|
|
|
17,475
|
|
|
12,726
|
|
|
—
|
|
|
128,194
|
|
||||||
Intercompany payables
|
1,598,212
|
|
|
60,707
|
|
|
—
|
|
|
—
|
|
|
(1,658,919
|
)
|
(a)
|
—
|
|
||||||
Accrued payroll
|
16,736
|
|
|
98,887
|
|
|
4,819
|
|
|
40,120
|
|
|
—
|
|
|
160,562
|
|
||||||
Accrued vacation
|
4,083
|
|
|
58,355
|
|
|
12,295
|
|
|
18,142
|
|
|
—
|
|
|
92,875
|
|
||||||
Accrued interest
|
17,479
|
|
|
7
|
|
|
6
|
|
|
2,393
|
|
|
—
|
|
|
19,885
|
|
||||||
Accrued other
|
39,219
|
|
|
57,378
|
|
|
12,599
|
|
|
33,970
|
|
|
—
|
|
|
143,166
|
|
||||||
Income taxes payable
|
—
|
|
|
1,302
|
|
|
30
|
|
|
7,739
|
|
|
—
|
|
|
9,071
|
|
||||||
Total Current Liabilities
|
1,734,331
|
|
|
362,865
|
|
|
49,436
|
|
|
117,690
|
|
|
(1,658,919
|
)
|
|
605,403
|
|
||||||
Long-term debt, net of current portion
|
2,042,555
|
|
|
127
|
|
|
24,730
|
|
|
610,303
|
|
|
—
|
|
|
2,677,715
|
|
||||||
Non-current deferred tax liability
|
—
|
|
|
88,376
|
|
|
780
|
|
|
45,750
|
|
|
(9,989
|
)
|
(e)
|
124,917
|
|
||||||
Other non-current liabilities
|
36,259
|
|
|
56,721
|
|
|
8,138
|
|
|
44,591
|
|
|
—
|
|
|
145,709
|
|
||||||
Total Liabilities
|
3,813,145
|
|
|
508,089
|
|
|
83,084
|
|
|
818,334
|
|
|
(1,668,908
|
)
|
|
3,553,744
|
|
||||||
Redeemable non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
16,270
|
|
|
624,548
|
|
(d)
|
640,818
|
|
||||||
Stockholders’ Equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Common stock
|
0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0
|
|
||||||
Capital in excess of par
|
947,370
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
947,370
|
|
||||||
Retained earnings (accumulated deficit)
|
(124,002
|
)
|
|
1,416,857
|
|
|
(35,942
|
)
|
|
64,626
|
|
|
(1,445,541
|
)
|
(c)(d)
|
(124,002
|
)
|
||||||
Subsidiary investment
|
—
|
|
|
3,221,628
|
|
|
273,415
|
|
|
437,779
|
|
|
(3,932,822
|
)
|
(b)(d)
|
—
|
|
||||||
Total Select Medical Corporation Stockholders’ Equity
|
823,368
|
|
|
4,638,485
|
|
|
237,473
|
|
|
502,405
|
|
|
(5,378,363
|
)
|
|
823,368
|
|
||||||
Non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
3,910
|
|
|
105,326
|
|
(d)
|
109,236
|
|
||||||
Total Equity
|
823,368
|
|
|
4,638,485
|
|
|
237,473
|
|
|
506,315
|
|
|
(5,273,037
|
)
|
|
932,604
|
|
||||||
Total Liabilities and Equity
|
$
|
4,636,513
|
|
|
$
|
5,146,574
|
|
|
$
|
320,557
|
|
|
$
|
1,340,919
|
|
|
$
|
(6,317,397
|
)
|
|
$
|
5,127,166
|
|
(a)
|
Elimination of intercompany balances.
|
(b)
|
Elimination of investments in consolidated subsidiaries.
|
(c)
|
Elimination of investments in consolidated subsidiaries’ earnings.
|
(d)
|
Reclassification of equity attributable to non-controlling interests.
|
(e)
|
Reclassification of non-current deferred tax asset to report net non-current deferred tax liability in consolidation.
|
18.
|
Financial Information for Subsidiary Guarantors and Non-Guarantor Subsidiaries under Select’s 6.375% Senior Notes (Continued)
|
|
Select
(Parent
Company Only)
|
|
Subsidiary
Guarantors
|
|
Non-Guarantor
Subsidiaries
|
|
Non-Guarantor
Concentra
|
|
Consolidating and Eliminating Adjustments
|
|
Consolidated Select
Medical Corporation
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Net operating revenues
|
$
|
700
|
|
|
$
|
2,685,308
|
|
|
$
|
666,013
|
|
|
$
|
1,013,224
|
|
|
$
|
—
|
|
|
$
|
4,365,245
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of services, exclusive of depreciation and amortization
|
2,585
|
|
|
2,299,360
|
|
|
576,708
|
|
|
856,656
|
|
|
—
|
|
|
3,735,309
|
|
||||||
General and administrative
|
111,069
|
|
|
159
|
|
|
—
|
|
|
2,819
|
|
|
—
|
|
|
114,047
|
|
||||||
Depreciation and amortization
|
7,540
|
|
|
76,408
|
|
|
14,118
|
|
|
61,945
|
|
|
—
|
|
|
160,011
|
|
||||||
Total costs and expenses
|
121,194
|
|
|
2,375,927
|
|
|
590,826
|
|
|
921,420
|
|
|
—
|
|
|
4,009,367
|
|
||||||
Income (loss) from operations
|
(120,494
|
)
|
|
309,381
|
|
|
75,187
|
|
|
91,804
|
|
|
—
|
|
|
355,878
|
|
||||||
Other income and expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Intercompany interest and royalty fees
|
32,828
|
|
|
(18,369
|
)
|
|
(14,459
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Intercompany management fees
|
220,601
|
|
|
(180,588
|
)
|
|
(40,013
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Loss on early retirement of debt
|
(19,719
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,719
|
)
|
||||||
Equity in earnings of unconsolidated subsidiaries
|
—
|
|
|
20,973
|
|
|
81
|
|
|
—
|
|
|
—
|
|
|
21,054
|
|
||||||
Non-operating loss
|
—
|
|
|
(49
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(49
|
)
|
||||||
Interest income (expense)
|
(124,406
|
)
|
|
298
|
|
|
(87
|
)
|
|
(30,508
|
)
|
|
—
|
|
|
(154,703
|
)
|
||||||
Income (loss) before income taxes
|
(11,190
|
)
|
|
131,646
|
|
|
20,709
|
|
|
61,296
|
|
|
—
|
|
|
202,461
|
|
||||||
Income tax expense (benefit)
|
(8,753
|
)
|
|
(2,549
|
)
|
|
557
|
|
|
(7,439
|
)
|
|
—
|
|
|
(18,184
|
)
|
||||||
Equity in earnings of consolidated subsidiaries
|
179,621
|
|
|
13,536
|
|
|
—
|
|
|
—
|
|
|
(193,157
|
)
|
(a)
|
—
|
|
||||||
Net income
|
177,184
|
|
|
147,731
|
|
|
20,152
|
|
|
68,735
|
|
|
(193,157
|
)
|
|
220,645
|
|
||||||
Less: Net income attributable to non-controlling interests
|
—
|
|
|
120
|
|
|
6,616
|
|
|
36,725
|
|
|
—
|
|
|
43,461
|
|
||||||
Net income attributable to Select Medical Corporation
|
$
|
177,184
|
|
|
$
|
147,611
|
|
|
$
|
13,536
|
|
|
$
|
32,010
|
|
|
$
|
(193,157
|
)
|
|
$
|
177,184
|
|
(a)
|
Elimination of equity in earnings of consolidated subsidiaries.
|
18.
|
Financial Information for Subsidiary Guarantors and Non-Guarantor Subsidiaries under Select’s 6.375% Senior Notes (Continued)
|
|
Select (Parent
Company Only)
|
|
Subsidiary
Guarantors
|
|
Non-Guarantor
Subsidiaries
|
|
Non-Guarantor
Concentra
|
|
Consolidating and Eliminating Adjustments
|
|
Consolidated Select
Medical Corporation
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net income
|
$
|
177,184
|
|
|
$
|
147,731
|
|
|
$
|
20,152
|
|
|
$
|
68,735
|
|
|
$
|
(193,157
|
)
|
(a)
|
$
|
220,645
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Distributions from unconsolidated subsidiaries
|
—
|
|
|
19,940
|
|
|
66
|
|
|
—
|
|
|
—
|
|
|
20,006
|
|
||||||
Depreciation and amortization
|
7,540
|
|
|
76,408
|
|
|
14,118
|
|
|
61,945
|
|
|
—
|
|
|
160,011
|
|
||||||
Provision for bad debts
|
—
|
|
|
1,067
|
|
|
—
|
|
|
66
|
|
|
—
|
|
|
1,133
|
|
||||||
Equity in earnings of unconsolidated subsidiaries
|
—
|
|
|
(20,973
|
)
|
|
(81
|
)
|
|
—
|
|
|
—
|
|
|
(21,054
|
)
|
||||||
Equity in earnings of consolidated subsidiaries
|
(179,621
|
)
|
|
(13,536
|
)
|
|
—
|
|
|
—
|
|
|
193,157
|
|
(a)
|
—
|
|
||||||
Loss on extinguishment of debt
|
6,527
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,527
|
|
||||||
Loss (gain) on sale of assets and businesses
|
(939
|
)
|
|
(4,828
|
)
|
|
(4,602
|
)
|
|
20
|
|
|
—
|
|
|
(10,349
|
)
|
||||||
Stock compensation expense
|
18,291
|
|
|
—
|
|
|
—
|
|
|
993
|
|
|
—
|
|
|
19,284
|
|
||||||
Amortization of debt discount, premium and issuance costs
|
7,895
|
|
|
—
|
|
|
—
|
|
|
3,235
|
|
|
—
|
|
|
11,130
|
|
||||||
Deferred income taxes
|
14,041
|
|
|
(40,788
|
)
|
|
156
|
|
|
(45,733
|
)
|
|
—
|
|
|
(72,324
|
)
|
||||||
Changes in operating assets and liabilities, net of effects of business combinations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Accounts receivable
|
—
|
|
|
(84,264
|
)
|
|
(27,683
|
)
|
|
(6,886
|
)
|
|
—
|
|
|
(118,833
|
)
|
||||||
Other current assets
|
(1,068
|
)
|
|
4,459
|
|
|
(3,745
|
)
|
|
1,951
|
|
|
—
|
|
|
1,597
|
|
||||||
Other assets
|
168
|
|
|
(4,235
|
)
|
|
3,413
|
|
|
(232
|
)
|
|
—
|
|
|
(886
|
)
|
||||||
Accounts payable
|
1,450
|
|
|
2,271
|
|
|
1,091
|
|
|
(909
|
)
|
|
—
|
|
|
3,903
|
|
||||||
Accrued expenses
|
(25,396
|
)
|
|
2,919
|
|
|
12,493
|
|
|
27,325
|
|
|
—
|
|
|
17,341
|
|
||||||
Net cash provided by operating activities
|
26,072
|
|
|
86,171
|
|
|
15,378
|
|
|
110,510
|
|
|
—
|
|
|
238,131
|
|
||||||
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Business combinations, net of cash acquired
|
—
|
|
|
(10,006
|
)
|
|
(1,664
|
)
|
|
(15,720
|
)
|
|
—
|
|
|
(27,390
|
)
|
||||||
Purchases of property and equipment
|
(30,413
|
)
|
|
(136,267
|
)
|
|
(37,651
|
)
|
|
(28,912
|
)
|
|
—
|
|
|
(233,243
|
)
|
||||||
Investment in businesses
|
—
|
|
|
(12,682
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,682
|
)
|
||||||
Proceeds from sale of assets and businesses
|
45,788
|
|
|
15,022
|
|
|
19,537
|
|
|
3
|
|
|
—
|
|
|
80,350
|
|
||||||
Net cash provided by (used in) investing activities
|
15,375
|
|
|
(143,933
|
)
|
|
(19,778
|
)
|
|
(44,629
|
)
|
|
—
|
|
|
(192,965
|
)
|
||||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Borrowings on revolving facilities
|
970,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
970,000
|
|
||||||
Payments on revolving facilities
|
(960,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(960,000
|
)
|
||||||
Proceeds from term loans
|
1,139,487
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,139,487
|
|
||||||
Payments on term loans
|
(1,156,377
|
)
|
|
—
|
|
|
—
|
|
|
(23,065
|
)
|
|
—
|
|
|
(1,179,442
|
)
|
||||||
Revolving facility debt issuance costs
|
(4,392
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,392
|
)
|
||||||
Borrowings of other debt
|
25,630
|
|
|
—
|
|
|
18,224
|
|
|
2,767
|
|
|
—
|
|
|
46,621
|
|
||||||
Principal payments on other debt
|
(13,748
|
)
|
|
(456
|
)
|
|
(3,036
|
)
|
|
(3,407
|
)
|
|
—
|
|
|
(20,647
|
)
|
||||||
Dividends paid to Holdings
|
(4,753
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,753
|
)
|
||||||
Equity investment by Holdings
|
2,017
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,017
|
|
||||||
Intercompany
|
(40,410
|
)
|
|
56,742
|
|
|
(16,332
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Decrease in overdrafts
|
(9,899
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,899
|
)
|
||||||
Proceeds from issuance of non-controlling interests
|
—
|
|
|
—
|
|
|
9,982
|
|
|
—
|
|
|
—
|
|
|
9,982
|
|
||||||
Distributions to and purchases of non-controlling interests
|
—
|
|
|
(135
|
)
|
|
(4,933
|
)
|
|
(5,552
|
)
|
|
—
|
|
|
(10,620
|
)
|
||||||
Net cash provided by (used in) financing activities
|
(52,445
|
)
|
|
56,151
|
|
|
3,905
|
|
|
(29,257
|
)
|
|
—
|
|
|
(21,646
|
)
|
||||||
Net increase (decrease) in cash and cash equivalents
|
(10,998
|
)
|
|
(1,611
|
)
|
|
(495
|
)
|
|
36,624
|
|
|
—
|
|
|
23,520
|
|
||||||
Cash and cash equivalents at beginning of period
|
11,071
|
|
|
6,467
|
|
|
5,056
|
|
|
76,435
|
|
|
—
|
|
|
99,029
|
|
||||||
Cash and cash equivalents at end of period
|
$
|
73
|
|
|
$
|
4,856
|
|
|
$
|
4,561
|
|
|
$
|
113,059
|
|
|
$
|
—
|
|
|
$
|
122,549
|
|
(a)
|
Elimination of equity in earnings of consolidated subsidiaries.
|
18.
|
Financial Information for Subsidiary Guarantors and Non-Guarantor Subsidiaries under Select’s 6.375% Senior Notes (Continued)
|
|
Select
(Parent
Company Only)
|
|
Subsidiary
Guarantors
|
|
Non-Guarantor
Subsidiaries
|
|
Non-Guarantor
Concentra
|
|
Consolidating and Eliminating Adjustments
|
|
Consolidated Select
Medical Corporation
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Net operating revenues
|
$
|
541
|
|
|
$
|
2,729,803
|
|
|
$
|
504,621
|
|
|
$
|
982,495
|
|
|
$
|
—
|
|
|
$
|
4,217,460
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of services, exclusive of depreciation and amortization
|
2,037
|
|
|
2,362,781
|
|
|
460,301
|
|
|
840,256
|
|
|
—
|
|
|
3,665,375
|
|
||||||
General and administrative
|
106,864
|
|
|
63
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
106,927
|
|
||||||
Depreciation and amortization
|
5,348
|
|
|
68,329
|
|
|
10,917
|
|
|
60,717
|
|
|
—
|
|
|
145,311
|
|
||||||
Total costs and expenses
|
114,249
|
|
|
2,431,173
|
|
|
471,218
|
|
|
900,973
|
|
|
—
|
|
|
3,917,613
|
|
||||||
Income (loss) from operations
|
(113,708
|
)
|
|
298,630
|
|
|
33,403
|
|
|
81,522
|
|
|
—
|
|
|
299,847
|
|
||||||
Other income and expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Intercompany interest and royalty fees
|
31,083
|
|
|
(17,404
|
)
|
|
(13,679
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Intercompany management fees
|
168,915
|
|
|
(140,300
|
)
|
|
(28,615
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Loss on early retirement of debt
|
(773
|
)
|
|
—
|
|
|
—
|
|
|
(10,853
|
)
|
|
—
|
|
|
(11,626
|
)
|
||||||
Equity in earnings of unconsolidated subsidiaries
|
—
|
|
|
19,838
|
|
|
105
|
|
|
—
|
|
|
—
|
|
|
19,943
|
|
||||||
Non-operating gain
|
33,932
|
|
|
8,719
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42,651
|
|
||||||
Interest income (expense)
|
(132,066
|
)
|
|
315
|
|
|
(34
|
)
|
|
(38,296
|
)
|
|
—
|
|
|
(170,081
|
)
|
||||||
Income (loss) before income taxes
|
(12,617
|
)
|
|
169,798
|
|
|
(8,820
|
)
|
|
32,373
|
|
|
—
|
|
|
180,734
|
|
||||||
Income tax expense (benefit)
|
(14,461
|
)
|
|
54,557
|
|
|
2,656
|
|
|
12,712
|
|
|
—
|
|
|
55,464
|
|
||||||
Equity in earnings (losses) of consolidated subsidiaries
|
113,567
|
|
|
(8,093
|
)
|
|
—
|
|
|
—
|
|
|
(105,474
|
)
|
(a)
|
—
|
|
||||||
Net income (loss)
|
115,411
|
|
|
107,148
|
|
|
(11,476
|
)
|
|
19,661
|
|
|
(105,474
|
)
|
|
125,270
|
|
||||||
Less: Net income (loss) attributable to non-controlling interests
|
—
|
|
|
218
|
|
|
(2,536
|
)
|
|
12,177
|
|
|
—
|
|
|
9,859
|
|
||||||
Net income (loss) attributable to Select Medical Corporation
|
$
|
115,411
|
|
|
$
|
106,930
|
|
|
$
|
(8,940
|
)
|
|
$
|
7,484
|
|
|
$
|
(105,474
|
)
|
|
$
|
115,411
|
|
(a)
|
Elimination of equity in earnings of consolidated subsidiaries.
|
18.
|
Financial Information for Subsidiary Guarantors and Non-Guarantor Subsidiaries under Select’s 6.375% Senior Notes (Continued)
|
|
Select (Parent
Company Only)
|
|
Subsidiary
Guarantors
|
|
Non-Guarantor
Subsidiaries
|
|
Non-Guarantor
Concentra
|
|
Consolidating and Eliminating Adjustments
|
|
Consolidated Select
Medical Corporation
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Net income (loss)
|
$
|
115,411
|
|
|
$
|
107,148
|
|
|
$
|
(11,476
|
)
|
|
$
|
19,661
|
|
|
$
|
(105,474
|
)
|
(a)
|
$
|
125,270
|
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Distributions from unconsolidated subsidiaries
|
—
|
|
|
20,380
|
|
|
96
|
|
|
—
|
|
|
—
|
|
|
20,476
|
|
||||||
Depreciation and amortization
|
5,348
|
|
|
68,329
|
|
|
10,917
|
|
|
60,717
|
|
|
—
|
|
|
145,311
|
|
||||||
Provision for bad debts
|
—
|
|
|
511
|
|
|
—
|
|
|
21
|
|
|
—
|
|
|
532
|
|
||||||
Equity in earnings of unconsolidated subsidiaries
|
—
|
|
|
(19,838
|
)
|
|
(105
|
)
|
|
—
|
|
|
—
|
|
|
(19,943
|
)
|
||||||
Equity in earnings of consolidated subsidiaries
|
(113,567
|
)
|
|
8,093
|
|
|
—
|
|
|
—
|
|
|
105,474
|
|
(a)
|
—
|
|
||||||
Loss on extinguishment of debt
|
773
|
|
|
—
|
|
|
—
|
|
|
10,853
|
|
|
—
|
|
|
11,626
|
|
||||||
Loss (gain) on sale of assets and businesses
|
(33,738
|
)
|
|
(12,975
|
)
|
|
246
|
|
|
(21
|
)
|
|
—
|
|
|
(46,488
|
)
|
||||||
Gain on sale of equity investment
|
—
|
|
|
(2,779
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,779
|
)
|
||||||
Impairment of equity investment
|
—
|
|
|
5,339
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,339
|
|
||||||
Stock compensation expense
|
16,643
|
|
|
—
|
|
|
—
|
|
|
770
|
|
|
—
|
|
|
17,413
|
|
||||||
Amortization of debt discount, premium and issuance costs
|
12,358
|
|
|
—
|
|
|
—
|
|
|
3,298
|
|
|
—
|
|
|
15,656
|
|
||||||
Deferred income taxes
|
(709
|
)
|
|
—
|
|
|
—
|
|
|
(11,882
|
)
|
|
—
|
|
|
(12,591
|
)
|
||||||
Changes in operating assets and liabilities, net of effects of business combinations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Accounts receivable
|
—
|
|
|
56,165
|
|
|
(30,045
|
)
|
|
3,121
|
|
|
—
|
|
|
29,241
|
|
||||||
Other current assets
|
(1,432
|
)
|
|
10,293
|
|
|
(4,602
|
)
|
|
13,191
|
|
|
—
|
|
|
17,450
|
|
||||||
Other assets
|
(2,978
|
)
|
|
51,586
|
|
|
(53,295
|
)
|
|
13,977
|
|
|
—
|
|
|
9,290
|
|
||||||
Accounts payable
|
330
|
|
|
(24,679
|
)
|
|
5,781
|
|
|
3,076
|
|
|
—
|
|
|
(15,492
|
)
|
||||||
Accrued expenses
|
(1,287
|
)
|
|
52,783
|
|
|
(1,110
|
)
|
|
(4,094
|
)
|
|
—
|
|
|
46,292
|
|
||||||
Net cash provided by (used in) operating activities
|
(2,848
|
)
|
|
320,356
|
|
|
(83,593
|
)
|
|
112,688
|
|
|
—
|
|
|
346,603
|
|
||||||
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Business combinations, net of cash acquired
|
(406,305
|
)
|
|
(59,520
|
)
|
|
(953
|
)
|
|
(5,428
|
)
|
|
—
|
|
|
(472,206
|
)
|
||||||
Purchases of property and equipment
|
(15,262
|
)
|
|
(101,864
|
)
|
|
(28,561
|
)
|
|
(15,946
|
)
|
|
—
|
|
|
(161,633
|
)
|
||||||
Investment in businesses
|
—
|
|
|
(4,723
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,723
|
)
|
||||||
Proceeds from sale of assets and businesses
|
63,418
|
|
|
16,978
|
|
|
67
|
|
|
—
|
|
|
—
|
|
|
80,463
|
|
||||||
Proceeds from sale of equity investment
|
—
|
|
|
3,779
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,779
|
|
||||||
Net cash used in investing activities
|
(358,149
|
)
|
|
(145,350
|
)
|
|
(29,447
|
)
|
|
(21,374
|
)
|
|
—
|
|
|
(554,320
|
)
|
||||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Borrowings on revolving facilities
|
575,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
575,000
|
|
||||||
Payments on revolving facilities
|
(650,000
|
)
|
|
—
|
|
|
—
|
|
|
(5,000
|
)
|
|
—
|
|
|
(655,000
|
)
|
||||||
Proceeds from term loans
|
600,127
|
|
|
—
|
|
|
—
|
|
|
195,217
|
|
|
—
|
|
|
795,344
|
|
||||||
Payments on term loans
|
(230,524
|
)
|
|
—
|
|
|
—
|
|
|
(207,510
|
)
|
|
—
|
|
|
(438,034
|
)
|
||||||
Borrowings of other debt
|
11,935
|
|
|
—
|
|
|
12,970
|
|
|
2,816
|
|
|
—
|
|
|
27,721
|
|
||||||
Principal payments on other debt
|
(15,144
|
)
|
|
(751
|
)
|
|
(2,554
|
)
|
|
(2,952
|
)
|
|
—
|
|
|
(21,401
|
)
|
||||||
Dividends paid to Holdings
|
(2,929
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,929
|
)
|
||||||
Equity investment by Holdings
|
1,672
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,672
|
|
||||||
Intercompany
|
67,115
|
|
|
(169,163
|
)
|
|
102,048
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Increase in overdrafts
|
10,746
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,746
|
|
||||||
Proceeds from issuance of non-controlling interests
|
—
|
|
|
—
|
|
|
11,846
|
|
|
—
|
|
|
—
|
|
|
11,846
|
|
||||||
Distributions to and purchases of non-controlling interests
|
—
|
|
|
(2,331
|
)
|
|
(6,839
|
)
|
|
(3,484
|
)
|
|
—
|
|
|
(12,654
|
)
|
||||||
Net cash provided by (used in) financing activities
|
367,998
|
|
|
(172,245
|
)
|
|
117,471
|
|
|
(20,913
|
)
|
|
—
|
|
|
292,311
|
|
||||||
Net increase in cash and cash equivalents
|
7,001
|
|
|
2,761
|
|
|
4,431
|
|
|
70,401
|
|
|
—
|
|
|
84,594
|
|
||||||
Cash and cash equivalents at beginning of period
|
4,070
|
|
|
3,706
|
|
|
625
|
|
|
6,034
|
|
|
—
|
|
|
14,435
|
|
||||||
Cash and cash equivalents at end of period
|
$
|
11,071
|
|
|
$
|
6,467
|
|
|
$
|
5,056
|
|
|
$
|
76,435
|
|
|
$
|
—
|
|
|
$
|
99,029
|
|
(a)
|
Elimination of equity in earnings of consolidated subsidiaries.
|
19.
|
Selected Quarterly Financial Data (Unaudited)
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||
For the year ended December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net operating revenues(1)
|
$
|
1,091,517
|
|
|
$
|
1,102,465
|
|
|
$
|
1,077,014
|
|
|
$
|
1,094,249
|
|
Income from operations
|
91,765
|
|
|
115,663
|
|
|
72,098
|
|
|
76,352
|
|
||||
Net income
|
23,463
|
|
|
51,300
|
|
|
24,824
|
|
|
121,058
|
|
||||
Net income attributable to Select Medical Holdings Corporation
|
15,870
|
|
|
42,055
|
|
|
18,462
|
|
|
100,797
|
|
||||
Earnings per common share(2):
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
$
|
0.12
|
|
|
$
|
0.32
|
|
|
$
|
0.14
|
|
|
$
|
0.75
|
|
Diluted
|
$
|
0.12
|
|
|
$
|
0.32
|
|
|
$
|
0.14
|
|
|
$
|
0.75
|
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||
For the year ended December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net operating revenues
|
$
|
1,252,964
|
|
|
$
|
1,296,210
|
|
|
$
|
1,267,401
|
|
|
$
|
1,264,683
|
|
Income from operations
|
108,598
|
|
|
120,561
|
|
|
99,837
|
|
|
88,283
|
|
||||
Net income
|
43,982
|
|
|
60,559
|
|
|
42,679
|
|
|
29,722
|
|
||||
Net income attributable to Select Medical Holdings Corporation
|
33,739
|
|
|
46,511
|
|
|
32,917
|
|
|
24,673
|
|
||||
Earnings per common share(2):
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
$
|
0.25
|
|
|
$
|
0.35
|
|
|
$
|
0.24
|
|
|
$
|
0.18
|
|
Diluted
|
$
|
0.25
|
|
|
$
|
0.35
|
|
|
$
|
0.24
|
|
|
$
|
0.18
|
|
(1)
|
Net operating revenues were retrospectively conformed to reflect the adoption of Topic 606, Revenue from Contracts with Customers.
|
(2)
|
Due to rounding, the summation of quarterly earnings per common share balances may not equal year to date equivalents.
|
|
|
Balance at
Beginning
of Year
|
|
Charged to
Cost and
Expenses
|
|
Acquisitions(1)
|
|
Deductions(2)
|
|
Balance at
End of Year
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Income Tax Valuation Allowance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Year ended December 31, 2018
|
|
$
|
12,986
|
|
|
$
|
1,032
|
|
|
$
|
3,875
|
|
|
$
|
—
|
|
|
$
|
17,893
|
|
Year ended December 31, 2017
|
|
$
|
26,421
|
|
|
$
|
(13,435
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
12,986
|
|
Year ended December 31, 2016
|
|
$
|
7,586
|
|
|
$
|
(118
|
)
|
|
$
|
18,975
|
|
|
$
|
(22
|
)
|
|
$
|
26,421
|
|
(1)
|
Includes valuation allowance reserves resulting from business combinations.
|
(2)
|
Valuation allowance deductions relate to the disposition of certain subsidiaries.
|
COMPANY:
|
|
CONCENTRA GROUP HOLDINGS PARENT, LLC
|
|
By:
|
/s/ Michael E. Tarvin
|
Name: Michael E. Tarvin
|
|
Title: Executive Vice President
|
|
MEMBERS:
|
|
SELECT MEDICAL CORPORATION
|
|
By:
|
/s/ Michael E. Tarvin
|
Name: Michael E. Tarvin
|
|
Title: Executive Vice President, General Counsel & Secretary
|
WELSH, CARSON, ANDERSON & STOWE XH, L.P.
|
|
By: WCAS XII ASSOCIATES LLC, its General Partner
|
|
By:
|
/s/ D. Scott Mackesy
|
Name: D. Scott Mackesy
|
|
Title: Authorized Signatory
|
|
WELSH, CARSON, ANDERSON & STOWE XII DELAWARE, L.P.
|
|
By: WCAS XII ASSOCIATES CAYMAN L.P., its General Partner
|
|
By: WCAS XII ASSOCIATES LLC, its General Partner
|
|
By:
|
/s/ D. Scott Mackesy
|
Name: D. Scott Mackesy
|
|
Title: Authorized Signatory
|
WELSH, CARSON, ANDERSON & STOWE XII DELAWARE II, L.P.
|
|
By: WCAS XII ASSOCIATES LLC, its General Partner
|
|
By:
|
/s/ D. Scott Mackesy
|
Name: D. Scott Mackesy
|
|
Title: Authorized Signatory
|
|
WELSH, CARSON, ANDERSON & STOWE XII CAYMAN, L.P.
|
|
By: WCAS XII ASSOCIATES CAYMAN L.P., its General Partner
|
|
By: WCAS XII ASSOCIATES LLC, its General Partner
|
|
By:
|
/s/ D. Scott Mackesy
|
Name: D. Scott Mackesy
|
|
Title: Authorized Signatory
|
WCAS XII CO-INVESTORS LLC
|
|
By:
|
/s/ D. Scott Mackesy
|
Name: D. Scott Mackesy
|
|
Title: Authorized Signatory
|
|
WCAS MANAGEMENT CORPORATION
|
|
By:
|
/s/ D. Scott Mackesy
|
Name: D. Scott Mackesy
|
|
Title: Authorized Signatory
|
CRESSEY & COMPANY FUND IV LP
By: Cressey & Company GP LP, its general partner By: Cressey & Company LLC, its general partner |
|
By:
|
/s/ Bryan Cressey
|
Name: Bryan Cressey
|
|
Title: Partner
|
DIGNITY HEALTH HOLDING CORPORATION
|
|
By:
|
/s/ Daniel J. Morissette
|
Name: Daniel J. Morissette
|
|
Title: Sr. Executive Vice President & CFO
|
DAEG HOLDING LC
|
|
By:
|
/s/ James M. Greenwood
|
Name: James M. Greenwood
|
|
Title: Manager
|
JKC TR HOLDINGS, LLC
|
|
By:
|
/s/ John K. Carlyle
|
Name: John K. Carlyle
|
|
Title: Manager
|
DTLT PRIVATE HOLDINGS, LLC
|
|
By:
|
/s/ Daniel E. Thomas
|
Name: Daniel E. Thomas
|
|
Title: Authorized Person
|
|
/s/ Matthew T. DiCanio
|
Matthew T. DiCanio
|
|
/s/ Giovanni Gallara
|
Giovanni Gallara
|
|
/s/ John A. Delorimier
|
John A. DeLorimier
|
|
/s/ Gregory M. Gilbert
|
Gregory M. Gilbert
|
|
/s/ Michael A. Kosuth
|
Michael A. Kosuth
|
|
/s/ Douglas R. McAndrew
|
Douglas R. McAndrew
|
WKN TR HOLDINGS, LLC
|
/s/ W. Keith Newton
|
By: W. Keith Newton
Title: Authorized Signatory |
|
/s/ James J. Talalai
|
James J. Talalai
|
|
/s/ Scott C. Wise
|
Scott C. Wise
|
|
/s/ Su Zan Nelson
|
Su Zan Nelson
|
1. Date:
|
|
October 24, 2018
|
|
|
2. Landlord:
|
|
207 Associates and Independence Avenue Investments, LLC
|
|
|
3. Tenant:
|
|
Select Medical Corporation
|
|
|
4. Guarantor:
|
|
N/A
|
|
|
5. Building:
|
|
225 Grandview Avenue
|
|
|
6. Premises:
|
|
Entire First Floor and Part of Second Floor known as Suite 202 – See Exhibit A.
|
|
|
7. Occupancy Date:
|
|
Upon completion of “white box”
|
|
|
8. Rent Commencement Date:
|
|
Commencement Date as defined in Section 2.01
|
|
|
9. Expiration Date:
|
|
10th Anniversary of the Rent Commencement Date
|
|
|
10. Term:
|
|
Ten (10) years
|
|
|
11. Rentable Area of the Building:
|
|
215,532 – See Section 25.06
|
|
Rentable square feet
|
12. Rentable Area of the Premises:
|
|
72,173 – See Section 25.06
|
|
Rentable square feet
|
13. Tenant’s Proportionate Share:
|
|
FULL SERVICE LEASE
|
|
|
14. Initial Annual Base Rental Rate:
|
|
$20.00
|
|
per Rentable square foot
|
15. Initial Annual Base Rental:
|
|
$1,443,460
|
|
|
16. Annual Base Rental Increase:
|
|
2.5%
|
|
|
17. Annual increase in rental rates will occur on
|
|
1st anniversary and on subsequent anniversaries of the Rent Commencement Date.
|
|
|
18. Annual Operating Expense Allowance:
|
|
N/A (FULL SERVICE LEASE)
|
|
|
19. Fiscal Year:
|
|
12 months ending December 31
|
|
|
20. Security Deposit:
|
|
0
|
|
|
21. First Rent Check:
|
|
$120,288.33
|
|
|
22. Broker:
|
|
N/A
|
|
|
23. Landlord’s Address for Notices:
|
|
207 Associates and Independence Avenue Investments, LLC
|
|
|
|
|
c/o Select Capital Commercial Properties, Inc.
|
|
|
|
|
4732 Gettysburg Rd., Suite 302
|
|
|
|
|
Mechanicsburg, PA 17055
|
|
|
Attention:
|
|
Property Manager
|
|
|
24. Tenant’s Address for Notices:
|
|
Select Medical Corporation
|
|
|
|
|
4732 Gettysburg Road
|
|
|
|
|
Suite 402
|
|
|
|
|
Mechanicsburg, PA 17055
|
|
|
Attention:
|
|
|
|
|
25.
|
Other Terms and Conditions
|
•
|
The Landlord will deliver the first-floor rental area with all interior walls removed but for rated walls, walls at elevators, restrooms, lobby, and walls at the high ceiling eating area including under the overhang of the floor above.
|
•
|
Replace and/or upgrade most of the major equipment of the mechanical system that is either non-functional or outdated. This could include but not be limited to cooling towers, chillers, pumps, air handling units, boiler, fire pumps, life safety generator, building exhaust fans, domestic water pumps and building automation system.
|
•
|
Replace existing window glazing and spandrel panels. Depending on delivery this phase may commence after Tenant occupies.
|
•
|
Modernize the elevator equipment including the interior cabs.
|
•
|
Replace the roof including all flashing.
|
•
|
Upgrade the fire alarm system.
|
•
|
New building security system at the building entrance doors.
|
•
|
All flooring removed except at restrooms and the wood floor in the high ceiling eating area.
|
•
|
All kitchen equipment removed and walls demolished.
|
•
|
Ceiling system including grid, tiles, and diffusers to be replaced.
|
•
|
Perimeter walls to be finished, ready for paint.
|
•
|
Restrooms will be remodeled similar to those in 4732 Gettysburg Road, Mechanicsburg, PA.
|
•
|
Landlord will also renovate the entrance lobby and construct a secondary entrance at the northeast corner. If the construction of the secondary entrance results in a reduced rental area (as certified by the architect) the rentable square footage will be reduced by an addendum.
|
•
|
Based on the above, the first floor area will be delivered to the Tenant as a “white box” and prepared for tenant specific improvements to be completed at the direction and expenses of the Tenant.
|
•
|
Tenant to provide Landlord with their office layout so that Landlord can install the HVAC, sprinkler and lighting systems designed to accommodate such layout.
|
25.04
|
This building will be undergoing significant renovations and as such, building issues will come up that cannot be anticipated at this time. To be better able to manage those issues Tenant will need to designate a point of contact with reasonable authority to act on behalf of the Tenant. The initial designees will be James Dehoff and Kathy Dorbert.
|
25.05
|
Tenant shall have the right and option to lease all (but not less than all) of the remaining space located on the 2nd floor of the Building and known as Suite 201 (See Exhibit A-1). Tenant shall exercise such option by giving written notice to Landlord of such decision (the “Option Notice”) on or before the date that is twenty six (26) months after the Rent Commencement Date hereunder as defined in Section 2.01 (the Option Exercise Deadline”). 30 days following its receipt of the Option Notice, Landlord will give Tenant access to Suite 201, which will be in the same condition as Suite 202 was when delivered to Tenant, for the purpose of
|
25.06
|
The square footage for the first floor, Suite 201 and Suite 202 are subject to final adjustment and determination after completion of the final designs of building common areas, all measurements to be completed in accordance with BOMA’s Standard Method of Floor Measurement for Office Buildings. After final determination of such square footages, the rental computations set forth in this Lease will be adjusted accordingly.
|
26.
|
Exhibits A-I are part of this Lease, identified as follows:
|
WITNESS: /s/ Dana Thompson
|
By: /s/ John M. Ortenzio
|
|
Date: 10/30/18
|
ATTEST: /s/ Dana Thompson
|
By: /s/ Michael E. Tarvin
|
EXHIBIT "A" – Description of Premise/Floor Plan
|
EXHIBIT "B" - Description of Leasehold Improvements
|
EXHIBIT "C" – Description of Property Plan
|
EXHIBIT “D" - Parking
|
EXHIBIT "E" - Security Card Access
|
EXHIBIT "F" - Rules and Regulations
|
EXHIBIT "G" - Move-in/Move-out Standards
|
EXHIBIT "H" - Rent Schedule
|
EXHIBIT "I" - Commencement Certificate
|
ARTICLE 1 - Premises
|
ARTICLE 2 - Term
|
ARTICLE 3 - Delivery of the Premises to Tenant
|
ARTICLE 4 - Acceptance of the Premises and Building by Tenant
|
ARTICLE 5 - Rental
|
ARTICLE 6 - Operating Expenses
|
ARTICLE 7 - Services by Landlord; Representations of Landlord
|
ARTICLE 8 - Utilities
|
ARTICLE 9 - Use
|
ARTICLE 10 - Laws, Ordinances and Requirements of Public Authorities
|
ARTICLE 11 - Observance of Rules and Regulations
|
ARTICLE 12 - Alterations
|
ARTICLE 13 -Liens
|
ARTICLE 14 - Ordinary Repairs
|
ARTICLE 15 – Insurance
|
ARTICLE 16 - Damage by Fire or Other Cause
|
ARTICLE 17 - Condemnation
|
ARTICLE 18 - Assignment and Subletting
|
ARTICLE 19 - Indemnification
|
ARTICLE 20 - Surrender of the Premises/Holdover
|
ARTICLE 21 - Estoppel Certificates
|
ARTICLE 22 - Subordination
|
ARTICLE 23 - Parking
|
ARTICLE 24 - Default and Remedies
|
ARTICLE 25 - Waiver by Landlord
|
ARTICLE 26 - Security Deposit
|
ARTICLE 27 - Attorney's Fees and Legal Expense
|
ARTICLE 28 - Notices
|
ARTICLE 29 - Miscellaneous
|
ARTICLE 30 –Right of Assignee
|
ARTICLE 31 – No Waiver
|
ARTICLES 32 – Limitation of Liability
|
ARTICLES 33 – Recording
|
ARTICLE 34 – Successors and Assigns
|
ARTICLE 35 – No Partnership
|
ARTICLE 36 – Attornment
|
ARTICLE 37 – Force Majeure
|
1.
|
Tenant, both in relation to the move in and move out process, must engage a moving company whose primary business and expertise is the moving of office equipment and furniture. Tenant must submit to Landlord the moving company’s Insurance Certificate which reflects that the Property owner and Property manager are insured against any and all damage caused by the moving company to the Property or to third parties and the moving company has the appropriate Worker’s Compensation insurance at least 3 days prior to any move.
|
2.
|
Tenant must give Landlord at least 24 hour notice prior to moving furniture or equipment in or out of the Property in order to allow Landlord to place protection pads on the elevator walls.
|
3.
|
Tenant may only use the elevator that Landlord has designated as the elevator for moving furniture or equipment.
|
4.
|
Tenant is responsible to adequately protect the floor and walls of the lobby, elevator, etc. from damage and failure to do so may result in a charge being issued to the Tenant to repair the walls or floors of the Property.
|
5.
|
Tenant and Tenant’s agents must move all furniture and other objects (that cannot be hand carried) on carts with non-marring rubber wheels and rubber sideguards to protect the finished surfaces of the walls and floors of the Property.
|
6.
|
Tenant, prior to moving any furniture or equipment, must properly block open all passageway doors in order to avoid damage to the doors by the moving of the furniture and equipment.
|
7.
|
Tenant shall be responsible for any and all damage resulting from the moving in and out of the Premise.
|
1.
|
Landlord and Tenant have entered into a Lease Agreement (the “Lease”) dated as of ___________________, 201_ whereby Landlord leased to Tenant, and Tenant leased from Landlord, certain real property located in__________________, PA which real property is located at ___________________________________________.
|
2.
|
In accordance with “Article 2 Lease Term” of the lease, Landlord and Tenant desire to set forth herein the date that the Term of the Lease has commenced (the “Commencement Date”), the date of expiration of the initial Term of the Lease and certain other terms and conditions.
|
LANDLORD:
|
TENANT:
|
|
|
|
|
|
|
By: _____________________________
|
By:______________________________
|
John Ortenzio, Manager
|
|
|
Print Name: _______________________
|
|
Title: _____________________________
|
(a)
|
Throughout such period of limitation, the Tenant shall remain liable for the maximum amount of rent and other charges which are legally payable (without regard to any limitation to the amount thereof expressed in this lease, except that all amounts payable by reason of this Section 5.03 shall not, in the aggregate, exceed the total of all amounts which would otherwise be payable by the Tenant pursuant to the terms of this lease for the period of the limitation);
|
(b)
|
At the termination of such period of limitation, the Tenant shall pay to the Landlord, on demand, but only to the extent legally collectable by the Landlord, any amounts which would have been due from the Tenant during the period of limitation, but which were not paid because of such limiting law, decision, rule or regulation; and
|
(c)
|
For the remaining period of the Term following the period of limitation, the Tenant shall pay the Landlord all amounts due for such portion of the Term in accordance with the provisions hereof calculated as though there had been no intervening period of limitation.
|
(a)
|
Wages, salaries and fees of all personnel or entities (exclusive of Landlord’s executive personnel) directly engaged in the operation, maintenance, repair or security of the Building, including taxes, insurance and benefits relating thereto, and a reasonable management fee payable to the property manager for management services rendered of 3% of Rent. As to personnel not involved exclusively with the administration and operation of the Building, only those portions of such expenses reasonably allocable to the Building shall be included.
|
(b)
|
All supplies and material used in the operation and maintenance of the Building, except for special lighting, relamping and ballasts within any Tenant Space.
|
(c)
|
Expenses of all maintenance, janitorial services, trash removal, security, life safety, and service agreements for the Building, and the equipment therein, including, without limitation, alarm service, pest control, interior/exterior window cleaning, elevator operation and maintenance, landscaping, lawn maintenance, parking facility maintenance, snow removal, roadway and utility maintenance and cleaning, etc.
|
(d)
|
Expenses of all insurance relating in the Building for which Landlord is responsible hereunder, or which Landlord considers reasonably necessary for the operation of the Building, including, without limitation, the cost of property, casualty and liability insurance applicable to the Building and Landlord’s personal property used in connection therewith, and the cost of business interruption of rental insurance.
|
(e)
|
All taxes, assessments, and other governmental charges, now or hereafter applicable to the Building, or any portion thereof or to Landlord’s personal property used in connection therewith, and dues (including those levied by an Association managing all common areas and easements) attributable to the Building or its operation, exclusive of any inheritance, gift, franchise, income, corporate, or profit taxes which may be assessed again Landlord.
|
(f)
|
The cost of repairs and general maintenance to the Building, including periodic preventative maintenance of the plumbing and electrical systems and heating, ventilating and cooling systems (excluding repairs and general maintenance paid by proceeds of insurance or by Tenant or other third parties and alterations attributable solely to other Tenants of the Building).
|
(g)
|
Landlord’s Costs related to fees paid to individuals or companies engaged in rendering legal, accounting or technical services including efforts to reduce Building Real Estate Tax expenses.
|
(h)
|
All utility costs to Landlord of the Building (exclusive, however, of such special utility services as are provided in Section 8.02 hereof), including, without limitation, water, power, fuel, heating, lighting, air conditioning and ventilation.
|
(i)
|
Costs of licenses, permits and similar fees and charges related to the operation, maintenance, repair, replacement or registration of the Building, other than any of the foregoing related to Leasehold Improvements.
|
(j)
|
Without limiting any of the foregoing, such other expenses or charges, which, in accordance with sound accounting and management principles general accepted with respect to a first-class building or corporate park, would be construed as an Operating Expense.
|
(b)
|
utility services provided for in Article 8 below.
|
(c)
|
janitorial cleaning services will be provided 5 nights a week to Tenants as is customary in comparable office buildings in the greater Harrisburg area: unless stated otherwise in the Basic Lease Information
|
(d)
|
Landlord will clean and maintain all exterior and interior common areas, including hallways and stairwells, on a regularly scheduled basis unless stated otherwise in the Basic Lease Information.
|
|
Landlord and is the legal, valid, and binding obligation of Landlord enforceable
|
(1)
|
in no event shall lighting have a design load greater than an average of 2.00 watts per Usable square foot, and
|
(2)
|
collectively, Tenant's equipment and lighting shall not have an electrical design load greater than an average of 3.75 watts per Usable square foot. Upon the existence of Tenant's excess electrical requirements, Landlord may, at its option, upon not less than 30 days prior written notice to Tenant, discontinue electric services to the Premises until Tenant reduces its power consumption to the permissible limits. Landlord will not be liable in any way to Tenant for failure or defect in the supply or character of electric energy or any other utility service furnished to the Premises because of any requirement, act, or omission of the public utility servicing the Building. All installations of electrical fixtures, appliances, and equipment within the Premises shall be subject to Landlord's prior approval. Landlord's obligation to furnish utility services shall be subject to the rules and regulations of any municipal or other governmental authority regulating the business of providing utility services. When Tenant's use of the Premises consumes power in excess of the Building Standard lighting and for normal office machines of similar low consumption, then the usage of such additional consumption shall be determined, at Landlord's election, either
|
(d)
|
by a survey performed by a reputable consultant selected by Landlord (and paid for by Tenant when such additional consumption is proven), or
|
a.
|
Tenant Liability Insurance. During the Lease Term, Tenant agrees to carry General and/or Excess Liability Insurance covering claims for third party bodily injury, death and property damage resulting from Tenant's use the Leased Premises, including contractual liability necessary to cover Tenant's obligations. Such Liability Insurance shall provide a minimum per occurrence and annual aggregate limit of $2,000,000 for all operations. Landlord, Property Manager and ground lessor of Landlord, if any shall be named as an additional insured on Tenant's General and/or Excess Liability Insurance to the extent of Tenant's liability and obligations under this Lease. Prior to the Commencement Date of this Lease, Tenant shall furnish Landlord with a certificate of insurance evidencing such coverage.
|
b.
|
Fire and Special Extended Coverage (“All Risks” Coverage). During the Lease Term, Tenant agrees to carry "All Risk" insurance covering the perils of fire, vandalism and malicious mischief, extended perils and sprinkler leakage, insuring Landlord’s build out improvements (i.e., Non-Standard Building Improvements) and personal property of Tenant located on or within the Leased Premises, on a full replacement cost basis. Prior to the Commencement Date of this Lease, Tenant shall furnish Landlord with a certificate of insurance evidencing such coverage.
|
c.
|
Relocation Insurance. Tenant shall also secure relocation insurance to pay the cost to relocate the Tenant and pay Tenant's rent to a third party for at least one hundred eighty (180) days during any period the Leased Premises may be damaged due to fire or other casualty or period. Prior to the Commencement Date of this Lease, Tenant shall furnish Landlord with a certificate evidencing such coverage.
|
d.
|
Worker’s Compensation. Tenant shall obtain and continuously maintain in full force and effect Worker’s Compensation and employer’s liability insurance with statutory benefits, voluntary compensation coverage, and employer’s liability limits of $100,000.00 for each accident as required by law.
|
e.
|
Any other form or forms of insurance as Tenant or Landlord or the mortgagees of Landlord may reasonably require from time to time in form, in amounts, and for insurance risks against which a prudent Tenant of a comparable size and in a comparable business would protect itself upon written notice to Tenant and provided that Tenant shall not be in default if Tenant is unable after good faith attempts to secure such insurance.
|
f.
|
Compliance. If Tenant shall not comply with its covenants made in this Article and such failure continues for ten (10) days after written notice from Landlord to Tenant, Landlord may cause insurance as aforesaid to be issued, in such event Tenant agrees to pay as Additional Rent, the premium for such insurance upon Landlord's demand.
|
g.
|
Prohibited Materials. Tenant shall not keep in the Leased Premises any article which may be prohibited by any reasonable insurance policy periodically in force covering the Building.
|
h.
|
Landlord Named as Additional Insured. All insurance secured by Tenant will name Landlord, Property Manager and ground lessor of Landlord (if any) as an additional insured, as its interest appears. Tenant shall deliver a certificate of such insurance to Landlord not later than five (5) days prior to the date that Tenant takes possession of any part of the Premises. All insurance required to be provided by Tenant under this Lease will (a) be issued by an insurance company or companies authorized to do business in the state in which the Leased Premises are located and which has and maintained a rating of A- or better in the Best’s Insurance Reports or the equivalent; (b) be primary and noncontributing with any insurance carried by Landlord; and (c) contain an endorsement requiring at least thirty (30) days prior written notice of cancellation to Landlord before cancellation, reduction or change in coverage, scope, or limit of any policy. Tenant will deliver a certificate of insurance to Landlord within thirty (30) days of execution of this Lease and will provide evidence of renewed insurance coverage at the request of Landlord, and prior to the expiration of any current policies (unless Tenant’s policies automatically renew, in which case renewal certificates will be provided as soon as available); however, in no event will Tenant be allowed to occupy the Leased Premises before providing adequate and acceptable proof of insurance as stated above.
|
i.
|
Blanket Policies of Insurance. Tenant shall have the right to satisfy its insurance obligations hereunder by extending its blanket policies of insurance (applicable to Tenant’s other locations) to include the Leased Premises, and Landlord hereby approves the same. Any insurance maintained by Tenant may have deductibles in the amounts generally maintained by Tenant with respect to a majority of its locations and Tenant may, at its election, self-insure for plate glass and Tenant’s personal property.
|
a.
|
Fire and Special Extended Coverage (“All Risks” Coverage). During the Lease Term, Landlord shall insure the Building against damage by All Risk, Fire and Standard Extended Coverage perils in an amount equal to the full replacement cost thereof. Landlord may, but shall not be obligated to, take out and carry any other form or forms of insurance as it or Landlord's mortgagees may reasonably determine appropriate. Tenant acknowledges that it has no right to receive any proceeds from any insurance policies carried by Landlord with respect to any Landlord build outs or improvements (i.e., Non-Building Standard Improvements) or on Tenant's furniture or furnishings, and Landlord shall not be obligated to repair or replace same. Landlord shall furnish Tenant with a certificate of insurance evidencing such coverage.
|
b.
|
Landlord Liability Insurance. Landlord, at all times during the Lease Term, shall maintain comprehensive Commercial General Liability insurance on an occurrence basis covering Landlord and any superior mortgagee against claims for bodily injury or death or property damage occurring in, upon, or about or resulting from the Leased Premises, including all common areas such as streets, drives, sidewalks, curbs or passageways, in an amount no less than $1,000,000 per occurrence and $2,000,000 in the aggregate, which may be based on a combination of primary coverage plus umbrella coverage. Landlord may, in a reasonable manner, allocate insurance premiums for so called "blanket" insurance policies which insure other properties as well as the Property and said allocated amount shall be deemed to be an insurance premium.
|
c.
|
Notwithstanding any contribution by Tenant to the cost of insurance premiums, as provided herein, Tenant acknowledges that it has no right to receive any proceeds from any insurance policies carried by Landlord. Landlord will not be required to carry insurance of any kind on any Non-Building Standard Leasehold Improvements, on Tenant's furniture or furnishings, or on any of Tenant's fixtures, equipment, improvements, or appurtenances under this Lease; and Landlord shall not be obligated to repair or replace same.
|
(a)
|
Resulting from any defect in the Premise or in the Building; or
|
(b)
|
Resulting from the condition or arrangement or from the interruption or breakdown of any heating, ventilating, air-conditioning, sprinkler, mechanical or electrical equipment or machinery or of any water, gas, sewage, electrical power or other utility in the Premise, or in the Building in which the Premise are contained or in the Building; or
|
(c)
|
By reason of the failure to supply adequate drainage, snow or ice removal; or
|
(d)
|
By reason of steam, smoke, water, rain, snow or other substances leaking, issuing, flowing or escaping into any part of the Premise; or
|
(e)
|
Resulting from anything done or omitted to be done by the Landlord, its servants, employees, agents, contractors, officers, customers, invitees or licensees, by other occupants of the Building, by persons in the Premise or in the Building, by occupants of adjacent property or by the public.
|
(d)
|
if Tenant or guarantor of Tenant’s obligations under this Lease becomes insolvent or is determined to be insolvent or makes a transfer in fraud of creditors;
|
(e)
|
if Tenant fails to take occupancy within 30 days of the commencement date;
|
(f)
|
if Tenant or guarantor of tenant’s obligations under this Lease, makes an assignment for the benefit of creditors; or
|
(g)
|
if a receiver, custodian or trustee is appointed for Tenant or for any of the assets of the Tenant which appointment is not vacated within 30 days of the date of such appointment.
|
(d)
|
Enter upon and take possession of the Premises as Tenant's agent without terminating this Lease and without being liable to prosecution or any claim for damages therefore, and Landlord may re-let the Premises as Tenant's agent and receive the Rental therefore, in which event Tenant shall pay to Landlord on demand the reasonable cost of renovating and repairing the Premises for a new Tenant or Tenants and any deficiency that may arise by reason of such re-letting; shall not release or affect Tenant's liability for Rental or for damages.
|
(e)
|
Upon the occurrence of any Event of Default which is not cured by the Tenant within the period of time provided herein, if any is so provided by the terms of this Lease, the Tenant hereby empowers any Prothonotary or any attorney of any court of record within the United States or elsewhere to appear for the Tenant, with declaration filed, and confess judgment against the Tenant in favor of the Landlord, its successors or assigns, as of any term, for any determined amount to which the Landlord would be entitled as damages under the provisions hereof including also any attorney fees for collection of the same plus ten percent (10%) of the total amount of such damages, together with costs of suit, and the Tenant hereby waives all errors, defects and imperfections in entering said judgment or in any writ, or process, or proceeding thereon or thereto or in anyway touching or concerning the same; and for the confession and entry of such judgment, this Lease or a true and correct copy thereof shall be sufficient warrant and authority. The authority and power contained herein shall not be exhausted by one exercise thereof, but judgment may be confessed as aforesaid from time to time and as often as there is an occurrence of any Event of Default which
|
(f)
|
When this lease shall be terminated or cancelled by reason of breach of any provision hereof, either during the original term of this lease or any renewal thereof, and also as soon as the term hereby created or any renewal thereof shall have expired, it shall be lawful for any attorney as attorney for Tenant to file an agreement for entering in any court of competent jurisdiction an amicable action and confession of judgment in ejectment against the Tenant and all persons claiming under the Tenant for the recovery by the Landlord of possession of the Premise, for which this lease or a true and correct copy thereof shall be his sufficient warrant, whereupon, if the Landlord so desires, a writ of possession may issue forthwith, without any prior writ or proceedings whatsoever, and provided that if for any reason after such action shall have commenced the same shall be terminated and possession remain in or be restored to the Tenant, the Landlord shall have the right upon any subsequent default or defaults, or upon the termination or cancellation of this lease as hereinbefore set forth, to bring one or more amicable action or actions as hereinbefore set forth to recover possession as aforesaid.
|
(a)
|
The right to three (3) months notice and/or ten (10), fifteen (15) or thirty (30) days notice required under certain circumstances by the Landlord and Tenant Act of 1951.
|
(b)
|
Landlord and Tenant hereby waive trial by jury in any action or proceeding or counterclaim brought by either party hereto against the other party on any, and every, matter, directly or indirectly arising out of or with respect to the Lease, including, without limitation, the relationship of Landlord and Tenant, the use and occupancy by Tenant of the Premise, any statutory remedy and/or claim of injury or damage regarding the Lease, and/or the relationship of Landlord and Tenant, and any emergency.
|
(c)
|
The benefit of all laws, now or hereafter in force, exempting any goods on the Demised Premises, or elsewhere, from distraint, levy or sale in any legal proceeding taken by the Landlord to enforce any rights under this Lease;
|
(d)
|
The benefit of all laws now made or which may hereafter be made regarding any limitations as to the goods upon which, or the time within which, distress is to be made after the removal of goods and further relieves the
|
(e)
|
The right to issue a writ of replevin for the recovery of any goods seized under a distress for rent or levy upon an execution for rent, damages or otherwise;
|
(f)
|
The right to delay execution on any real estate that may be levied upon to collect any amount which may become due under the terms and conditions of this lease and any right to have same appraised, and the Tenant authorizes any Prothonotary or clerk to enter a writ of execution or other process upon the Tenant’s voluntary waiver and further agrees that said real estate may be sold on a writ of execution of other process;
|
(g)
|
All rights under any law, ordinance or statue relating to Landlord and Tenant rights to the extent of hereby authorizing the sale of any goods distrained for rent at any time after seven (7) days from said distraint without appraisement and condemnation thereof;
|
(h)
|
Tenant hereby covenants and agrees to pay to Landlord, as Additional Rent, promptly upon demand, all costs and expenses incurred by Landlord in enforcing any and every provision of this Lease and/or in pursuing any remedy for default of this Lease, regardless of initiation or conclusion of any legal proceeding; said costs and expenses shall include, but not be limited to, all legal fees, attorney’s fees, and all court costs, including the preparation of documents and the filing fee of any and all papers with the courts and the cost of depositions and investigations.
|
NAME
|
|
Jurisdiction of Organization
|
AbsoluteCVO, Inc.
|
|
Michigan
|
ACC Capital, LLC
|
|
Delaware
|
Actra Rehabilitation Associates, Inc.
|
|
Wisconsin
|
Advantage Rehabilitation Clinics, Inc.
|
|
Massachusetts
|
Alexandria Sports, Inc.
|
|
New York
|
Allevant Solutions, LLC
|
|
Delaware
|
Ambulatory Care Solutions of Arkansas LLC
|
|
Arkansas
|
Ambulatory Care Solutions of Ohio LLC
|
|
Ohio
|
Ambulatory Care Solutions, LLC
|
|
Indiana
|
American Current Care of Arizona, P.A.
|
|
Arizona
|
American Current Care of Arkansas, P.A.
|
|
Arkansas
|
American Current Care of California, A Medical Corporation
|
|
California
|
American Current Care of Delaware, P.A.
|
|
Delaware
|
American Current Care of Hawaii, Prof. Corp.
|
|
Hawaii
|
American Current Care of Illinois, P.C.
|
|
Illinois
|
American Current Care of Kansas, P.A.
|
|
Kansas
|
American Current Care of Massachusetts, P.C.
|
|
Massachusetts
|
American Current Care of Michigan, P.C.
|
|
Michigan
|
American Current Care of Minnesota, P.C.
|
|
Minnesota
|
American Current Care of Missouri, P.C.
|
|
Missouri
|
American Current Care of Nebraska, P.C.
|
|
Nebraska
|
American Current Care of New Jersey PA
|
|
New Jersey
|
American Current Care of North Carolina, P.C.
|
|
North Carolina
|
American Current Care of Ohio, P.A., Co.
|
|
Ohio
|
American Current Care of Washington, P.S.
|
|
Washington
|
American Current Care, P.A.
|
|
Texas
|
American Transitional Hospitals, LLC
|
|
Delaware
|
Archer Rehabilitation, LLC
|
|
Delaware
|
Argosy Health, LLC
|
|
Delaware
|
Benchmark Acquisition Corp.
|
|
Delaware
|
Benchmark Medical Management Company
|
|
Delaware
|
Benchmark O&P Holdings, Inc.
|
|
Delaware
|
Benchmark Orthotics & Prosthetics, Inc.
|
|
Delaware
|
BHSM ES, Inc.
|
|
Delaware
|
Blue Hen Physical Therapy, Inc.
|
|
Delaware
|
California Rehab Institute Medical Group
|
|
California
|
California Rehabilitation Institute, LLC
|
|
Delaware
|
Cape Prosthetics-Orthotics, Inc.
|
|
Missouri
|
Caritas Rehab Services, LLC
|
|
Kentucky
|
Carrollton Physical Therapy Clinic, Inc.
|
|
Texas
|
Central Iowa Physio, LLC
|
|
Iowa
|
Cleveland Clinic Rehabilitation Hospitals, LLC
|
|
Delaware
|
CM Occupational Health, Limited Liability Company
|
|
Maine
|
Coastal Virginia ES, LLC
|
|
Delaware
|
Concentra Akron, L.L.C.
|
|
Delaware
|
Concentra Arkansas, L.L.C.
|
|
Delaware
|
Concentra Group Holdings Parent, LLC
|
|
Delaware
|
Concentra Group Holdings, LLC
|
|
Delaware
|
Concentra Health Services, Inc.
|
|
Delaware
|
Concentra Holdings, Inc.
|
|
Delaware
|
Concentra Inc.
|
|
Delaware
|
Concentra Integrated Services, Inc.
|
|
Massachusetts
|
Concentra Laboratory, L.L.C.
|
|
Delaware
|
Concentra Occupational Health Research Institute
|
|
Texas
|
Concentra Occupational Healthcare Harrisburg, L.P.
|
|
Pennsylvania
|
Concentra Operating Corporation
|
|
Delaware
|
Concentra Primary Care of California, a Medical Corporation
|
|
California
|
Concentra Primary Care of New Jersey PA
|
|
New Jersey
|
Concentra Primary Care of Ohio, P.A., Co.
|
|
Ohio
|
Concentra Primary Care, P.A.
|
|
Texas
|
Concentra Solutions, Inc.
|
|
Delaware
|
Concentra South Carolina, L.L.C.
|
|
Delaware
|
Concentra St. Louis, L.L.C.
|
|
Delaware
|
Concentramark, Inc.
|
|
Delaware
|
Concentra-UPMC, L.L.C.
|
|
Delaware
|
Connecticut Physical Therapy, LLC
|
|
Connecticut
|
CRI ES, Inc.
|
|
Delaware
|
Crowley Physical Therapy Clinic, Inc.
|
|
Louisiana
|
DG Physical Therapy, P.C.
|
|
Massachusetts
|
Dignity Select Nevada, LLC
|
|
Delaware
|
Douglas Avery & Associates, Ltd.
|
|
Virginia
|
Eagle Rehab Corporation
|
|
Delaware
|
Eden Sports, Inc.
|
|
New York
|
Elizabethtown Physical Therapy, P.S.C.
|
|
Kentucky
|
ES LTACH, LLC
|
|
Georgia
|
FC Select II, LLC
|
|
Delaware
|
FC Select, LLC
|
|
Delaware
|
Fine, Bryant & Wah, Inc.
|
|
Maryland
|
Frederick Orthopedic Rehabilitation, Inc.
|
|
Maryland
|
Freedom Management Services, LLC
|
|
Pennsylvania
|
Georgia Physical Therapy, Inc.
|
|
Georgia
|
GH General, LLC
|
|
Texas
|
GH General-San Antonio, LLC
|
|
Texas
|
GlobalRehab — Fort Worth, LP
|
|
Texas
|
GlobalRehab — San Antonio, LP
|
|
Texas
|
GlobalRehab, LP
|
|
Texas
|
GP Therapy, L.L.C.
|
|
Georgia
|
GR General-Scottsdale, LLC
|
|
Texas
|
Great Lakes Specialty Hospital—Hackley, LLC
|
|
Delaware
|
Great Lakes Specialty Hospital—Oak, LLC
|
|
Delaware
|
GRSH ES, Inc.
|
|
Delaware
|
Gulf Breeze Physical Therapy, Inc.
|
|
Florida
|
Hand Therapy Associates, Inc.
|
|
Arizona
|
Hospital Holdings Corporation
|
|
Delaware
|
Indiana Rehabilitation Services, LLC
|
|
Delaware
|
Indianapolis Physical Therapy and Sports Medicine, Inc.
|
|
Indiana
|
Integrity Physical Therapy, Inc.
|
|
Delaware
|
Intensiva Healthcare Corporation
|
|
Delaware
|
Intensiva Hospital of Greater St. Louis, Inc.
|
|
Missouri
|
Jeffersontown Physical Therapy, LLC
|
|
Kentucky
|
Johnson Physical Therapy, Inc.
|
|
Ohio
|
Joyner Sportsmedicine Institute, Inc.
|
|
Pennsylvania
|
Kentucky Orthopedic Rehabilitation, LLC
|
|
Delaware
|
Kentucky Rehabilitation Services, Inc.
|
|
Kentucky
|
Kessler Hudson County Rehabilitation, LLC
|
|
Delaware
|
Kessler Institute for Rehabilitation, Inc.
|
|
New Jersey
|
Kessler Orthotic & Prosthetic Services, Inc.
|
|
Delaware
|
Kessler Professional Services, LLC
|
|
Delaware
|
Kessler Rehab Centers, Inc.
|
|
Delaware
|
Kessler Rehabilitation Corporation
|
|
Delaware
|
Kessler Rehabilitation Services, Inc.
|
|
New Jersey
|
Keystone Rehabilitation Associates of Warren
|
|
Ohio
|
Keystone Rehabilitation Systems of McMurray
|
|
Pennsylvania
|
Keystone Rehabilitation Systems, Inc.
|
|
Pennsylvania
|
KORT Kentuckiana, LLC
|
|
Delaware
|
KORT Rehabilitation at Home, LLC
|
|
Delaware
|
Leesburg Sports, Inc.
|
|
New York
|
LifeBridge Sports Medicine and Rehabilitation, LLC
|
|
Maryland
|
LifeSigns Management, Inc.
|
|
Michigan
|
Louisville Physical Therapy, P.S.C.
|
|
Kentucky
|
LTACH @ Riverside, LLC
|
|
Virginia
|
Madison Rehabilitation Center, Inc.
|
|
Connecticut
|
Matrix Healthcare Services, LLC
|
|
Delaware
|
Matrix Rehabilitation, Inc.
|
|
Delaware
|
Matrix Rehabilitation-Delaware, Inc.
|
|
Delaware
|
Matrix Rehabilitation-Georgia, Inc.
|
|
Delaware
|
Matrix Rehabilitation-Ohio, Inc.
|
|
Delaware
|
Matrix Rehabilitation-South Carolina, Inc.
|
|
Delaware
|
Matrix Rehabilitation-Texas, Inc.
|
|
Delaware
|
Metro Rehabilitation Services, Inc.
|
|
Michigan
|
Morris Area Rehabilitation Association, Inc.
|
|
New Jersey
|
National Healthcare Resources, Inc.
|
|
Delaware
|
North Dallas Physical Therapy Associates, Inc.
|
|
Texas
|
Northstar Health Service, Inc.
|
|
Delaware
|
NovaCare Occupational Health Services, Inc.
|
|
Delaware
|
NovaCare Outpatient Rehabilitation East, Inc.
|
|
Delaware
|
NovaCare Outpatient Rehabilitation, Inc.
|
|
Kansas
|
NovaCare Rehabilitation of Ohio, Inc.
|
|
Ohio
|
NSR ES, Inc.
|
|
Delaware
|
NSR Louisiana, LLC
|
|
Louisiana
|
Occspecialists Corp., A Medical Corporation
|
|
California
|
Occupational Health + Rehabilitation LLC
|
|
Delaware
|
Occupational Health Centers of Arkansas, P.A.
|
|
Arkansas
|
Occupational Health Centers of California, a Medical Corporation
|
|
California
|
Occupational Health Centers of Delaware, P.A.
|
|
Delaware
|
Occupational Health Centers of Georgia, P.C.
|
|
Georgia
|
Occupational Health Centers of Illinois, P.C.
|
|
Illinois
|
Occupational Health Centers Of Kansas, P.A.
|
|
Kansas
|
Occupational Health Centers of Louisiana, a Professional Corporation
|
|
Louisiana
|
Occupational Health Centers of Michigan, P.C.
|
|
Michigan
|
Occupational Health Centers of Minnesota, P.C.
|
|
Minnesota
|
Occupational Health Centers of Nebraska, P.C.
|
|
Nebraska
|
Occupational Health Centers of New Jersey, P.A.
|
|
New Jersey
|
Occupational Health Centers of New York, P.A.
|
|
New York
|
Occupational Health Centers of North Carolina, P.C.
|
|
North Carolina
|
Occupational Health Centers of Ohio, P.A., Co.
|
|
Ohio
|
Occupational Health Centers of The Southwest, P.A. (AZ)
|
|
Arizona
|
Occupational Health Centers of The Southwest, P.A. (TX)
|
|
Texas
|
Occupational Health Centers of Washington, P.S.
|
|
Washington
|
OHC of Hawaii, Inc.
|
|
Hawaii
|
OHR/Baystate, LLC
|
|
Massachusetts
|
OHR/MMC, Limited Liability Company
|
|
Maine
|
OHRH, LLC
|
|
Ohio
|
OHRH ES, Inc.
|
|
Delaware
|
OHRH Select, Inc.
|
|
Delaware
|
OHRH Subsidiaries, LLC
|
|
Delaware
|
OMP Insurance Company, Ltd.
|
|
Cayman Islands
|
OnSite OccMed, P.A.
|
|
Texas
|
Orthopaedic Services of Paducah, Inc.
|
|
Kentucky
|
OSR Louisiana, LLC
|
|
Delaware
|
OSR Property Ventures, LLC
|
|
Delaware
|
Pacific Rehabilitation & Sports Medicine, Inc.
|
|
Delaware
|
Penn State Hershey Rehabilitation, LLC
|
|
Delaware
|
Philadelphia Occupational Health, P.C.
|
|
Pennsylvania
|
PHS Physical Therapy, LLC
|
|
Delaware
|
Physio at Hammonds Centre, LLC
|
|
Georgia
|
PhysioKids, Inc.
|
|
Delaware
|
PhysioLink Corporation
|
|
Delaware
|
Physiotherapy Associates Holdings, Inc.
|
|
Delaware
|
Physiotherapy Associates NRH Rehab, LLC
|
|
Maryland
|
Physiotherapy Associates Union Rehab, LLC
|
|
Maryland
|
Physiotherapy Associates, Inc.
|
|
Michigan
|
Physiotherapy Corporation
|
|
Delaware
|
Physiotherapy-BMHI Holdings, Inc.
|
|
Delaware
|
Pinnacle Health Select Rehabilitation, LLC
|
|
Delaware
|
PR Acquisition Corporation
|
|
California
|
Pro Active Therapy of North Carolina, Inc.
|
|
North Carolina
|
Pro Active Therapy of South Carolina, Inc.
|
|
South Carolina
|
Pro Active Therapy of Virginia, Inc.
|
|
Virginia
|
Pro Active Therapy, Inc.
|
|
North Carolina
|
Professional Rehab Associates, Inc.
|
|
Pennsylvania
|
Professional Therapeutic Services, Inc.
|
|
Ohio
|
Professional Therapy Systems, Inc.
|
|
Tennessee
|
Progressive Therapy, Services, Inc.
|
|
Ohio
|
PSHR Physical Therapy, LLC
|
|
Delaware
|
PTSMA, Inc.
|
|
Connecticut
|
R.S. Network, Inc.
|
|
Illinois
|
RCI (Michigan), Inc.
|
|
Delaware
|
RCI (WRS), Inc.
|
|
Delaware
|
Rebound Oklahoma, Inc.
|
|
Oklahoma
|
Regency Hospital Company of Macon, LLC
|
|
Delaware
|
Regency Hospital Company of Meridian, L.L.C.
|
|
Delaware
|
Regency Hospital Company of South Carolina, L.L.C.
|
|
Delaware
|
Regency Hospital Company, L.L.C.
|
|
Delaware
|
Regency Hospital of Atlanta, LLC
|
|
Delaware
|
Regency Hospital of Columbus, LLC
|
|
Delaware
|
Regency Hospital of Fort Worth Holdings, LLC
|
|
Delaware
|
Regency Hospital of Fort Worth, LLLP
|
|
Delaware
|
Regency Hospital of Greenville, LLC
|
|
Delaware
|
Regency Hospital of Jackson, LLC
|
|
Delaware
|
Regency Hospital of Kansas City, LLC
|
|
Delaware
|
Regency Hospital of Minneapolis, LLC
|
|
Delaware
|
Regency Hospital of North Central Ohio, LLC
|
|
Delaware
|
Regency Hospital of North Dallas Holdings, LLC
|
|
Delaware
|
Regency Hospital of North Dallas II, LLLP
|
|
Delaware
|
Regency Hospital of Northwest Arkansas, LLC
|
|
Delaware
|
Regency Hospital of Northwest Indiana, LLC
|
|
Delaware
|
Regency Hospital of Portland, LLC
|
|
Delaware
|
Regency Hospital of Rhode Island, LLC
|
|
Delaware
|
Regency Hospital of Rockford, LLC
|
|
Delaware
|
Regency Hospital of Southern Mississippi, LLC
|
|
Delaware
|
Regency Hospital of Toledo, LLC
|
|
Delaware
|
Regency Hospitals, LLC
|
|
Delaware
|
Regency Management Company, Inc.
|
|
Delaware
|
Rehab Associates of Jackson Hospital, LLC
|
|
Alabama
|
Rehab Associates, L.L.C.
|
|
Alabama
|
Rehab Colorado, LLC
|
|
Alabama
|
Rehab Missouri, LLC
|
|
Alabama
|
Rehab Provider Network of Colorado, Inc.
|
|
Colorado
|
Rehab Provider Network of New Mexico, Inc.
|
|
New Mexico
|
Rehab Provider Network of North Carolina, Inc.
|
|
North Carolina
|
Rehab Provider Network of South Carolina, Inc.
|
|
Delaware
|
Rehab Provider Network of Texas, Inc.
|
|
Texas
|
Rehab Provider Network of Virginia, Inc.
|
|
Virginia
|
Rehab Provider Network—East I, Inc.
|
|
Delaware
|
Rehab Provider Network—East II, Inc.
|
|
Maryland
|
Rehab Provider Network—Indiana, Inc.
|
|
Indiana
|
Rehab Provider Network—Michigan, Inc.
|
|
Michigan
|
Rehab Provider Network—Ohio, Inc.
|
|
Ohio
|
Rehab Provider Network—Pennsylvania, Inc.
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Pennsylvania
|
Rehab Xcel, LLC
|
|
Alabama
|
RehabClinics (PTA), Inc.
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Delaware
|
RehabClinics (SPT), Inc.
|
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Delaware
|
RehabClinics, Inc.
|
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Delaware
|
Rehabilitation Center of Washington, D.C., Inc.
|
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Delaware
|
Rehabilitation Consultants, Inc.
|
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Delaware
|
Rehabilitation Hospital of Vancouver, LLC
|
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Delaware
|
Rehabilitation Institute of Denton, LLC
|
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Delaware
|
Rehabilitation Institute of North Texas, LLC
|
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Delaware
|
RPN of NC, Inc.
|
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Delaware
|
RUSHWINC Properties, Inc.
|
|
Georgia
|
S.T.A.R.T., Inc.
|
|
Massachusetts
|
Saco Bay Orthopedic and Sports Physical Therapy, Inc.
|
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Maine
|
SCRI, LLC
|
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Delaware
|
Select Employment Services, Inc.
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Delaware
|
Select Hospital Investors, LP
|
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Delaware
|
Select Kentuckiana, Inc.
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Delaware
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Select LifeCare Western Michigan, LLC
|
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Delaware
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Select Medical International (US), Inc.
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Delaware
|
Select Medical International Limited
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Cyprus
|
Select Medical of Kentucky, Inc.
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Delaware
|
Select Medical of Maryland, Inc.
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Delaware
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Select Medical of New York, Inc.
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Delaware
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Select Medical Patient Safety and Quality Institute, LLC
|
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Delaware
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Select Medical Property Ventures, LLC
|
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Delaware
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Select Medical Rehabilitation Clinics, Inc.
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Delaware
|
Select NovaCare—KOP, Inc.
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Nevada
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Select NovaCare—PBG, Inc.
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New York
|
Select NovaCare—PIT, Inc.
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Arizona
|
Select Physical Therapy Holdings, Inc.
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Delaware
|
Select Physical Therapy Network Services, Inc.
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Delaware
|
Select Physical Therapy of Albuquerque, Ltd.
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Alabama
|
Select Physical Therapy of Chicago, Inc.
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Illinois
|
Select Physical Therapy of Colorado Springs Limited Partnership
|
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Alabama
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Select Physical Therapy of Connecticut Limited Partnership
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Alabama
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Select Physical Therapy of Denver, Ltd.
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Alabama
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Select Physical Therapy of Illinois Limited Partnership
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Alabama
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Select Physical Therapy of Kendall, Ltd.
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Alabama
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Select Physical Therapy of Las Vegas Limited Partnership
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Alabama
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Select Physical Therapy of Lorain Limited Partnership
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Alabama
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Select Physical Therapy of Louisville, Ltd.
|
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Alabama
|
Select Physical Therapy of Ohio Limited Partnership
|
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Alabama
|
Select Physical Therapy of Portola Valley Limited Partnership
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Alabama
|
Select Physical Therapy of St. Louis Limited Partnership
|
|
Alabama
|
Select Physical Therapy of West Denver Limited Partnership
|
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Alabama
|
Select Physical Therapy Orthopedic Services, Inc.
|
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Delaware
|
Select Physical Therapy Texas Limited Partnership
|
|
Alabama
|
Select Provider Networks, Inc.
|
|
Delaware
|
Select Rehabilitation Hospital—Hershey, Inc.
|
|
Delaware
|
Select Software Ventures, LLC
|
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Delaware
|
Select Specialty Hospital—Akron, LLC
|
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Delaware
|
Select Specialty Hospital—Ann Arbor, Inc.
|
|
Missouri
|
Select Specialty Hospital—Arizona, Inc.
|
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Delaware
|
Select Specialty Hospital—Augusta, Inc.
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Delaware
|
Select Specialty Hospital—Beech Grove, Inc.
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Missouri
|
Select Specialty Hospital—Belhaven, LLC
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Delaware
|
Select Specialty Hospital—Broward, Inc.
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Delaware
|
Select Specialty Hospital—Central Pennsylvania, L.P.
|
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Delaware
|
Select Specialty Hospital—Charleston, Inc.
|
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Delaware
|
Select Specialty Hospital—Cincinnati, Inc.
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Missouri
|
Select Specialty Hospital—Cleveland, LLC
|
|
Delaware
|
Select Specialty Hospital—Colorado Springs, Inc.
|
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Delaware
|
Select Specialty Hospital—Columbus, Inc.
|
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Delaware
|
Select Specialty Hospital—Dallas, Inc.
|
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Delaware
|
Select Specialty Hospital—Danville, Inc.
|
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Delaware
|
Select Specialty Hospital—Daytona Beach, Inc.
|
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Delaware
|
Select Specialty Hospital—Denver, Inc.
|
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Delaware
|
Select Specialty Hospital—Des Moines, Inc.
|
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Delaware
|
Select Specialty Hospital—Durham, Inc.
|
|
Delaware
|
Select Specialty Hospital—Erie, Inc.
|
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Delaware
|
Select Specialty Hospital—Evansville, Inc.
|
|
Missouri
|
Select Specialty Hospital—Evansville, LLC
|
|
Delaware
|
Select Specialty Hospital—Flint, Inc.
|
|
Missouri
|
Select Specialty Hospital—Fort Smith, Inc.
|
|
Missouri
|
Select Specialty Hospital—Fort Wayne, Inc.
|
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Missouri
|
Select Specialty Hospital—Gainesville, LLC
|
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Delaware
|
Select Specialty Hospital—Greensboro, Inc.
|
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Delaware
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Select Specialty Hospital—Grosse Pointe, Inc.
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Delaware
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Select Specialty Hospital—Gulf Coast, Inc.
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Missouri
|
Select Specialty Hospital—Houston, L.P.
|
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Delaware
|
Select Specialty Hospital—Jackson, Inc.
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Delaware
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Select Specialty Hospital—Johnstown, Inc.
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Missouri
|
Select Specialty Hospital—Kalamazoo, Inc.
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Delaware
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Select Specialty Hospital—Kansas City, Inc.
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Missouri
|
Select Specialty Hospital—Laurel Highlands, Inc.
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Delaware
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Select Specialty Hospital—Lexington, Inc.
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Delaware
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Select Specialty Hospital—Lincoln, Inc.
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Delaware
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Select Specialty Hospital—Little Rock, Inc.
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Delaware
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Select Specialty Hospital—Longview, Inc.
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Delaware
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Select Specialty Hospital—Macomb County, Inc.
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Missouri
|
Select Specialty Hospital—Madison, Inc.
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Delaware
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Select Specialty Hospital—McKeesport, Inc.
|
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Delaware
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Select Specialty Hospital—Memphis, Inc.
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Delaware
|
Select Specialty Hospital—Milwaukee, Inc.
|
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Delaware
|
Select Specialty Hospital—Nashville, Inc.
|
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Delaware
|
Select Specialty Hospital—North Atlanta, Inc.
|
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Delaware
|
Select Specialty Hospital—North Knoxville, Inc.
|
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Missouri
|
Select Specialty Hospital—Northeast New Jersey, Inc.
|
|
Delaware
|
Select Specialty Hospital—Northeast Ohio, Inc.
|
|
Missouri
|
Select Specialty Hospital—Northern Kentucky, LLC
|
|
Delaware
|
Select Specialty Hospital—Northwest Detroit, Inc.
|
|
Delaware
|
Select Specialty Hospital—Oklahoma City, Inc.
|
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Delaware
|
Select Specialty Hospital—Omaha, Inc.
|
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Missouri
|
Select Specialty Hospital—Orlando, Inc.
|
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Delaware
|
Select Specialty Hospital—Oshkosh, Inc.
|
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Delaware
|
Select Specialty Hospital—Palm Beach, Inc.
|
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Delaware
|
Select Specialty Hospital—Panama City, Inc.
|
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Delaware
|
Select Specialty Hospital—Pensacola, Inc.
|
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Delaware
|
Select Specialty Hospital—Phoenix, Inc.
|
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Delaware
|
Select Specialty Hospital—Pittsburgh/UPMC, Inc.
|
|
Delaware
|
Select Specialty Hospital—Quad Cities, Inc.
|
|
Delaware
|
Select Specialty Hospitals, Inc.
|
|
Delaware
|
Select Specialty Hospital—Saginaw, Inc.
|
|
Delaware
|
Select Specialty Hospital—San Antonio, Inc.
|
|
Delaware
|
Select Specialty Hospital—Savannah, Inc.
|
|
Delaware
|
Select Specialty Hospital—Sioux Falls, Inc.
|
|
Missouri
|
Select Specialty Hospital—South Dallas, Inc.
|
|
Delaware
|
Select Specialty Hospital—Springfield, Inc.
|
|
Delaware
|
Select Specialty Hospital—Tallahassee, Inc.
|
|
Delaware
|
Select Specialty Hospital—Topeka, Inc.
|
|
Missouri
|
Select Specialty Hospital—TriCities, Inc.
|
|
Delaware
|
Select Specialty Hospital—Tulsa, Inc.
|
|
Delaware
|
Select Specialty Hospital—Tulsa/Midtown, LLC
|
|
Delaware
|
Select Specialty Hospital—Western Michigan, Inc.
|
|
Missouri
|
Select Specialty Hospital—Wichita, Inc.
|
|
Missouri
|
Select Specialty Hospital—Wilmington, Inc.
|
|
Missouri
|
Select Specialty Hospital—Winston-Salem, Inc.
|
|
Delaware
|
Select Specialty Hospital—Youngstown, Inc.
|
|
Missouri
|
Select Specialty Hospital—Zanesville, Inc.
|
|
Delaware
|
Select Specialty—Downriver, LLC
|
|
Delaware
|
Select Subsidiaries, Inc.
|
|
Pennsylvania
|
Select Synergos, Inc.
|
|
Delaware
|
Select Transport, Inc.
|
|
Delaware
|
Select Unit Management, Inc.
|
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Delaware
|
SelectMark, Inc.
|
|
Delaware
|
SemperCare, Inc.
|
|
Delaware
|
SLMC Finance Corporation
|
|
Delaware
|
SMR Banyan Tree, Inc.
|
|
New York
|
SN Kentuckiana Rehab, LLC
|
|
Delaware
|
SPN - CHT, LLC
|
|
Delaware
|
SPN - Direct, LLC
|
|
Delaware
|
Special Care Hospital, LLC
|
|
Delaware
|
Sports Orthopedic Rehabilitation Services, Inc.
|
|
Florida
|
SSM Select Rehab St. Louis, LLC
|
|
Delaware
|
St. Mary’s Medical Park Pharmacy, Inc.
|
|
Arizona
|
Susquehanna Physical Therapy Associates, Inc.
|
|
Pennsylvania
|
Swanson Orthotic and Prosthetic Center, Inc.
|
|
Ohio
|
The Parks Physical Therapy and Work Hardening Center, Inc.
|
|
Texas
|
The Rehab Center
|
|
Pennsylvania
|
The Rehab Group, Inc.
|
|
Tennessee
|
The Rehab Group-Murfreesboro, LLC
|
|
Tennessee
|
Theraphysics Partners of Colorado, Inc.
|
|
Delaware
|
Theraphysics Partners of Texas, Inc.
|
|
Delaware
|
Therapy Associates of Martinsville, Inc.
|
|
Virginia
|
Therapy Centers of South Carolina, P.A.
|
|
South Carolina
|
Therapy Centers of The Southwest I, P.A.
|
|
Texas
|
TheraWorks, Inc.
|
|
Texas
|
TJ Corporation I, LLC
|
|
Delaware
|
TriHealth Rehabilitation, LLC
|
|
Delaware
|
Trumbull P.T. Corp.
|
|
Connecticut
|
U.S. HealthWorks Medical Group of Alaska, L.L.C.
|
|
Alabama
|
U.S. HealthWorks Medical Group of Georgia, Inc.
|
|
Georgia
|
U.S. HealthWorks Medical Group of Illinois, P.C.
|
|
Illinois
|
U.S. HealthWorks Medical Group of Indiana, P.C.
|
|
Indiana
|
U.S. HealthWorks Medical Group of Kansas City, P.A.
|
|
Kansas
|
U.S. HealthWorks Medical Group of Minnesota, P.C.
|
|
Minnesota
|
U.S. HealthWorks Medical Group of New Jersey, P.C.
|
|
New Jersey
|
U.S. HealthWorks Medical Group of North Carolina, P.C.
|
|
North Carolina
|
U.S. HealthWorks Medical Group of Ohio, Inc.
|
|
Ohio
|
U.S. HealthWorks Medical Group of Pennsylvania, PC
|
|
Pennsylvania
|
U.S. HealthWorks Medical Group of Tennessee, P.C.
|
|
Tennessee
|
U.S. HealthWorks Medical Group of Texas, Inc.
|
|
Texas
|
U.S. HealthWorks Medical Group of Washington, P.S.
|
|
Washington
|
U.S. HealthWorks Medical Group of Wisconsin, S.C.
|
|
Wisconsin
|
U.S. HealthWorks Medical Group, Prof. Corp.
|
|
California
|
U.S. HealthWorks of Colorado, Inc.
|
|
Colorado
|
U.S. HealthWorks of Indiana, Inc.
|
|
Indiana
|
U.S. HealthWorks of Kansas City, Inc.
|
|
Kansas
|
U.S. HealthWorks of Minnesota, Inc.
|
|
Minnesota
|
U.S. HealthWorks of New Jersey, Inc.
|
|
New Jersey
|
U.S. HealthWorks of Pennsylvania, Inc.
|
|
Pennsylvania
|
U.S. HealthWorks of Tennessee, Inc.
|
|
Tennessee
|
U.S. HealthWorks of Washington, Inc.
|
|
Washington
|
U.S. HealthWorks Provider Network of Colorado, Inc.
|
|
Colorado
|
U.S. HealthWorks, Inc.
|
|
Delaware
|
USHW of California, Inc.
|
|
California
|
USHW of Texas, Inc.
|
|
Texas
|
U.S. Medgroup of Arkansas, P.A.
|
|
Arkansas
|
U.S. Medgroup of Delaware, P.A.
|
|
Delaware
|
U.S. Medgroup of Illinois, P.C.
|
|
Illinois
|
U.S. Medgroup Of Kansas, P.A.
|
|
Kansas
|
U.S. Medgroup of Massachusetts, P.C.
|
|
Massachusetts
|
U.S. Medgroup of Michigan, P.C.
|
|
Michigan
|
U.S. Medgroup of Minnesota, P.C.
|
|
Minnesota
|
U.S. Medgroup of New Jersey, P.A.
|
|
New Jersey
|
U.S. Medgroup of North Carolina, P.C.
|
|
North Caroline
|
U.S. Medgroup of Ohio, P.A., Co.
|
|
Ohio
|
U.S. Medgroup of Washington, P.S.
|
|
Washington
|
U.S. Medgroup, P.A. (AZ)
|
|
Arizona
|
U.S. Medgroup, P.A. (TX)
|
|
Texas
|
U.S. Regional Occupational Health II of NJ, P.C.
|
|
New Jersey
|
U.S. Regional Occupational Health II, P.C.
|
|
Pennsylvania
|
Valor Healthcare, Inc.
|
|
Delaware
|
VHSD ES, Inc.
|
|
Delaware
|
Vibra Hospital of San Diego, LLC
|
|
Delaware
|
Victoria Healthcare, Inc.
|
|
Florida
|
West Gables Rehabilitation Hospital, LLC
|
|
Delaware
|
Wisconsin Prosthetics & Orthotics, Inc.
|
|
Wisconsin
|
WWLTACH, LLC
|
|
Delaware
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
Date: February 21, 2019
|
/s/ David S. Chernow
|
|
David S. Chernow
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of Select Medical Holdings Corporation and Select Medical Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
Date: February 21, 2019
|
/s/ Martin F. Jackson
|
|
Martin F. Jackson
|
|
Executive Vice President and Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
/s/ David S. Chernow
|
|
David S. Chernow
|
|
President and Chief Executive Officer
|
|
|
|
|
|
/s/ Martin F. Jackson
|
|
Martin F. Jackson
|
|
Executive Vice President and Chief Financial Officer
|
|