agilon health inc
For the period ended Dec 31, 2024. Filed Feb 25, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Feb 25, 2025
AGL$113.39-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-27.
0001628280-24-007242
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-25.
0001628280-25-007721
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 159 previous paragraphs and 148 current paragraphs.
100 unchanged; 38 reworded; 7 added; 19 removed; 2 previous and 3 current paragraphs rearranged.
Tables are not compared: 22 previous and 22 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (7)
Current report
•Total revenue of $6.06 billion increased 40% from 2023.
Current report
•Gross profit of $4.8 million, compared to $69.7 million in 2023.
Current report
•Medical margin of $205.2 million, compared to $298.7 million in 2023.
Current report
•Net loss of $260.1 million, compared to $262.8 million in 2023.
Current report
Medical services revenue increased by $1.74 billion, or 40%, for the year ended December 31, 2024 compared to 2023 due primarily to growth in average membership of 38%, which was attributable to seven new geographies that became operational in 2024 as well as growth in our existing geographies. The increase in medical services revenue was also driven, to a lesser extent, by a 2% increase in PMPM capitation rates. The increase in medical services revenue was partially offset by higher costs associated with prescription drug benefits provided under the Medicare Part D program, which is a reduction to medical services revenue, and lower risk adjustment revenue related to unfavorable prior period development.
Current report
Other income (expense), net increased $6.6 million, or 24%, for the year ended December 31, 2024 compared to 2023 primarily from income related to services rendered to our CMS ACO Models investments.
Current report
(2)Includes interest income, transaction-related costs and elimination of certain administrative services provided by agilon health, inc. to equity method investments.
Removed paragraphs (19)
Previous report
•Total revenue of $4.32 billion increased 81% from 2022.
Previous report
•Gross profit of $69.7 million, compared to $111.4 million in 2022.
Previous report
•Medical margin of $298.7 million, compared to $291.0 million in 2022.
Previous report
•Net loss of $262.8 million, compared to $106.9 million in 2022.
Previous report
Disposition of Hawaii Operations
Previous report
On October 31, 2023, we completed the disposition of MDX Hawaii, Inc. (“MDX Hawaii”), a wholly-owned subsidiary, and its related operations. Acquired by agilon in 2016, MDX Hawaii is a provider network with fully-delegated risk contracts and management services organization capabilities, including claims processing and utilization management. Our decision to exit Hawaii and the Independent Practice Association line of business represents a strategic shift that will have a major effect on our operations and financial results. As such, our Hawaii operations are reflected in the consolidated financial statements as discontinued operations. See Note 20 to the Consolidated Financial Statements for additional information.
Previous report
Total Discontinued Operations
Previous report
Total Discontinued Operations
Previous report
Medical services revenue increased by 57%, due primarily to growth in average membership of 45% that was attributable to six new geographies that became operational in 2022 and growth in our existing geographies. Average medical services revenue per member remained relatively flat compared to prior year.
Previous report
General and administrative expenses decreased $219.7 million, or 51%, for the year ended December 31, 2022 compared to 2021. Substantially all of the year-over-year decrease in general and administrative expenses is attributable to a $264.0 million decrease in non-cash stock-based compensation expense, which was largely related to shares issued under partner physician group equity agreements in connection with our initial public offering ("IPO") in April 2021 and the satisfaction of a performance condition associated with certain stock options in the third quarter of 2021.
Previous report
Income (loss) from equity method investments increased $17.5 million, or 258%, for the year ended 2022 compared to 2021 primarily from our new ACO REACH equity investments in 2022 and a full year of operations from our existing ACO REACH investments, which became operational in April 2021.
Previous report
(1)For the years ended December 31, 2022 and 2021, includes taxes and related costs on stock option exercises for departed executives of $2.0 million and $5.4 million, respectively.
Previous report
(3)Includes interest income and transaction-related costs.
Previous report
(4)Effective in 2023, we no longer exclude geography entry costs from our computation of Adjusted EBITDA. Adjusted EBITDA for the prior periods presented has been restated to the current period computation methodology.
Previous report
As of December 31, 2023, we had $25.1 million outstanding surety bonds related to health plan payor risk-bearing capital contributions.
Previous report
Stock-based Compensation
Previous report
Stock-based compensation cost is measured at grant date, based on the fair value of the award, and is recognized (i) on a straight-line basis over the requisite service period for awards subject only to service-based vesting conditions or (ii) upon the achievement of the underlying performance condition for awards subject to such conditions. We determine the fair value of stock-based option awards subject to a service condition on the date of grant using the Black-Scholes option pricing model, unless the awards are also subject to a market condition, in which case we use a Monte Carlo simulation valuation model. Assumptions for volatility, expected option life and risk free interest rate are used in our models.
Previous report
Certain of our arrangements provided for the vesting of share-based awards to third parties at the time of an initial public offering or sale of a controlling interest (“Change of Control Event”). Such share-based instruments granted to third parties are accounted for as non-employee awards for which compensation cost is recognized upon the achievement of the underlying performance condition of a Change of Control Event. As the instruments were liability-classified, the amount of shares ultimately issued and related compensation cost were measured at the vesting date in April 2021, as a
Previous report
Change of Control Event was not deemed probable until consummated. Upon our IPO, we recognized stock-based compensation cost relating to these share-based instruments of $268.5 million.
Reworded paragraphs (38)
Previous wording
•Medicare Advantage members of approximately 388,400 as of December 31, 2023 increased 68% from 2022.
Current wording
•Medicare Advantage members of approximately 526,500 as of December 31, 2024 increased 36% from 2023.
Previous wording
•ACO REACH attributed beneficiaries of approximately 89,300 as of December 31, 2023 remained flat from 2022.
Current wording
•The CMS ACO Models attributed beneficiaries of approximately 132,100 as of December 31, 2024 increased 48% from 2023.
Previous wording
•Adjusted EBITDA loss of $95.0 million, compared to Adjusted EBITDA loss of $45.5 million in 2022.
Current wording
•Adjusted EBITDA loss of $154.2 million, compared to Adjusted EBITDA loss of $95.0 million in 2023.
Previous wording
Medicare Advantage members increased 68% during 2023, which includes contributions from new geographies and growth within geographies existing prior to 2023. Total members live on the agilon platform include
Current wording
Medicare Advantage members increased 36% during 2024, which includes contributions from new geographies and growth within geographies existing prior to 2024. Total members live on the agilon platform include
Previous wording
388,400 Medicare Advantage members and 89,300 attributed ACO REACH beneficiaries. Average Medicare Advantage membership during 2023 was approximately 379,400.
Current wording
526,500 Medicare Advantage members and 132,100 CMS ACO Models attributed beneficiaries. Average Medicare Advantage membership during 2024 was approximately 522,100.
Previous wording
(1)Represents physician compensation expense related to surplus sharing and other care management expenses that help to create medical cost efficiency. Includes costs in geographies that are in implementation and are not yet generating revenue and investments to grow existing markets. For the years ended December 31, 2023, 2022, and 2021, costs incurred in implementing geographies were $33.7 million, $23.9 million and $12.0 million, respectively.
Current wording
(1)Represents physician compensation expense related to surplus sharing and other care management expenses that help to create medical cost efficiency. Includes costs in geographies that are in implementation and are not yet generating revenue and investments to grow existing markets. For the years ended December 31, 2024, 2023, and 2022, costs incurred in implementing geographies were $5.4 million, $33.7 million and $23.9 million, respectively.
Previous wording
See “—Non-GAAP Financial Measures” below, for information regarding our use of medical margin and a reconciliation of gross profit to medical margin.
Current wording
See “—Non-GAAP Financial Measures” below, for additional information regarding our use of medical margin and a reconciliation of gross profit to medical margin.
Previous wording
Net income (loss) is the most directly comparable GAAP measure to Adjusted EBITDA. We define Adjusted EBITDA as net income (loss) adjusted to exclude: (i) income (loss) from discontinued operations, net of income taxes, (ii) interest expense, (iii) income tax expense (benefit), (iv) depreciation and amortization, (v) stock-based compensation expense, (vi) severance and related costs, and (vii) certain other items that are not considered by us in the evaluation of ongoing operating performance. We reflect our share of Adjusted EBITDA for equity method investments by applying our actual ownership percentage for the period to the applicable reconciling items on an entity-by-entity basis.
Current wording
Net income (loss) is the most directly comparable U.S. GAAP measure to Adjusted EBITDA. We define Adjusted EBITDA as net income (loss) adjusted to exclude: (i) income (loss) from discontinued operations, net of income taxes, (ii) interest expense, (iii) income tax expense (benefit), (iv) depreciation and amortization, (v) stock-based compensation expense, (vi) severance and related costs, and (vii) certain other items that are not considered by us in the evaluation of ongoing operating performance. We reflect our share of Adjusted EBITDA for equity method investments by applying our actual ownership percentage for the period to the applicable reconciling items on an entity-by-entity basis.
Previous wording
See “—Non-GAAP Financial Measures” below, for information regarding our use of Adjusted EBITDA and a reconciliation of net income (loss) to Adjusted EBITDA.
Current wording
See “—Non-GAAP Financial Measures” below, for additional information regarding our use of Adjusted EBITDA and a reconciliation of net income (loss) to Adjusted EBITDA.
Previous wording
Our medical services revenue consists of capitation revenue under contracts with various payors. Under the typical capitation arrangement, we are entitled to PMPM fees to provide a defined range of healthcare services for MA health plan members through our contracted physician partners and affiliated PCPs. Such fees are typically based on a defined percentage of corresponding premium that payors receive from CMS. We recognize capitation revenue over the period eligible members are entitled to receive healthcare services.
Current wording
Our medical services revenue consists of capitation revenue under contracts with various payors. Under the typical capitation arrangement, we are entitled to PMPM fees to provide a defined range of healthcare services for MA health plan members through our contracted physician partners and affiliated PCPs. Such fees are typically based on a defined percentage of corresponding premium that payors receive from CMS. We recognize capitation revenue over the period eligible members are entitled to receive healthcare services. In certain of our payor arrangements, we are also financially responsible for Medicare Part D pharmaceutical costs for prescriptions rendered to members.
Previous wording
For additional discussion related to our revenue, see “—Critical Accounting Estimates” below and Note 2 to the Consolidated Financial Statements.
Current wording
For additional discussion related to our revenue, see “—Critical Accounting Estimates” below and Note 2 to the Consolidated Financial Statements in Item 8 of this Report.
Previous wording
For additional discussion related to our medical services expense, see “—Critical Accounting Estimates” below and Note 2 to the Consolidated Financial Statements.
Current wording
For additional discussion related to our medical services expense, see “—Critical Accounting Estimates” below and Note 2 to the Consolidated Financial Statements in Item 8 of this Report.
Previous wording
Income (loss) from equity method investments consists primarily of income associated with our participation in the ACO REACH program.
Current wording
Income (loss) from equity method investments consists primarily of income associated with our participation in the CMS ACO Models programs.
Previous wording
Total discontinued operations consist of the results of our Hawaii and California operations. For certain of our divestiture transactions, we continue to be responsible for any liabilities arising from the business that were incurred prior to the closing date of such transaction, including any fines, penalties, and other sanctions, the payment of claims for medical services incurred prior to the effective date of each transaction, a liability for unrecognized tax benefits for which we are indemnified, and other contingent liabilities that we currently believe are remote. For additional discussion, see Note 20 to the Consolidated Financial Statements.
Current wording
Total discontinued operations consist of the results of our Hawaii and California operations. For certain of our divestiture transactions, we continue to be responsible for any liabilities arising from the business that were incurred prior to the closing date of such transaction, including any fines, penalties, and other sanctions, the payment of claims for medical services incurred prior to the effective date of each transaction, a liability for unrecognized tax benefits for which we are indemnified, and other contingent liabilities that we currently believe are remote. For additional discussion, see Note 20 to the Consolidated Financial Statements in Item 8 of this Report.
Previous wording
Medical services expense increased by 54% due primarily to average membership growth of 45%, which was attributable to six new geographies that became operational in 2022 and growth in our existing geographies. The increase in medical services expense was also driven, to a lesser extent, by a 2% increase in PMPM capitation rates.
Current wording
Medical services expense increased by $1.83 billion, or 46% for the year ended December 31, 2024 compared to 2023 due primarily to average membership growth of 38%, which was attributable to seven new geographies that became operational in 2024 as well as growth in our existing geographies. The increase in medical services expense was also driven by an increase in average medical services expense per member of 6%, which was primarily due to the continued impact of elevated medical cost trends and unfavorable prior period reserve development.
Previous wording
Other medical expenses increased by $84.6 million, or 86%, for the year ended December 31, 2022 compared to 2021. Partner physician compensation expense increased by $42.8 million to $94.6 million in 2022 compared to $51.8 million in 2021 as a result of six new geographies that became operational in 2022 and growth in our existing geographies. Other provider costs increased by $41.8 million to $88.4 million in 2022 compared to $46.6 million in 2021, as the number of geographies and members on our platform increased in 2022. Other provider costs in 2022 include $23.9 million related to geographies that became operational in January 2023, while other provider costs in 2021 include $12.0 million of costs related to geographies that became operational in 2022.
Current wording
Other medical expenses decreased by $24.9 million, or 10%, for the year ended December 31, 2024 compared to 2023. Partner physician compensation expense decreased to $63.4 million in 2024 compared to $94.5 million in 2023 as a result of the losses generated in our geographies, which is a function of medical services revenues less the sum of medical services expenses, other provider costs and market operating costs, for the respective geography. Other provider costs increased by $6.0 million to $149.8 million in 2024 compared to $143.5 million in 2023, as the number of geographies and members on our platform increased in 2024. Other provider costs in 2024 include $5.4 million related to geographies that became operational in January 2025, while other provider costs in 2023 include $33.7 million of costs related to geographies that became operational in 2024.
Previous wording
Operating costs to support our live geographies and enterprise functions (platform support costs) increased by $31.1 million to $127.5 million in 2022 compared to $96.3 million in 2021 due primarily to growth in operating costs incurred to support geographies that became operational in 2022. Operating costs to support our live geographies and enterprise functions as a percentage of revenue decreased to 5% for the year ended December 31, 2022 compared to 6% for the same period in 2021. Investments to support geography entry increased to $43.9 million in 2022, compared to $20.6 million in 2021 due to increased costs associated with our geographies that become operational in the following calendar year.
Current wording
General and administrative expenses decreased $16.8 million, or 6%, for the year ended December 31, 2024 compared to 2023. Operating costs to support our live geographies and enterprise functions (platform support costs) increased by $5.8 million to $169.4 million in 2024 compared to $163.7 million in 2023 due primarily to growth in operating costs incurred to support geographies that became operational in 2024. Operating costs to support our live geographies and enterprise functions as a percentage of revenue decreased to 3% for the year ended December 31, 2024 compared to 4% in 2023. Investments to support geography entry decreased to $28.5 million for the year ended December 31, 2024, compared to $40.8 million in 2023 due to the decreased costs associated with our geographies that are expected to become operational in the following calendar year and expansion into existing geographies. Stock-based compensation expense decreased $18.7 million in 2024 primarily due to the cancellation of stock-based instruments during 2024.
Previous wording
Discontinued operations generated losses of $67.6 million for the year ended December 31, 2023 compared to $14.6 million for the year ended December 31, 2022. In 2023, we completed the disposition of our Hawaii operations and recognized a loss on sale of assets of $47.5 million. For additional discussion related to discontinued operations, see Note 20 to the Consolidated Financial Statements.
Current wording
Discontinued operations generated losses of $9.8 million for the year ended December 31, 2024 compared to $67.6 million for the year ended December 31, 2023. In 2023, we completed the disposition of our Hawaii operations and recognized a loss on sale of assets of $47.5 million. For additional discussion related to discontinued operations, see Note 20 to the Consolidated Financial Statements in Item 8 of this Report.
Previous wording
Medical services revenue increased by 81%, due primarily to growth in average membership of 69% that was attributable to eight new geographies that became operational in 2023 and growth in our existing geographies. The increase in medical services revenue was also driven, to a lesser extent, by a 7% increase in PMPM capitation rates.
Current wording
Medical services revenue increased by 81%, due primarily to growth in average membership of 69%, which was attributable to eight new geographies that became operational in 2023 as well as growth in our existing geographies. The increase in medical services revenue was also driven, to a lesser extent, by a 7% increase in PMPM capitation rates.
Previous wording
Medical services expense increased by 91% due primarily to average membership growth of 69%, which was attributable to eight new geographies that became operational in 2023 and growth in our existing geographies. The increase in medical services expense was also driven by an increase in average medical services expense per member of 14%. During 2023, we experienced an increase in medical claims expenses attributable to higher-than-expected utilization. The increase in medical service utilization trends became visible during the fourth quarter as a result of additional updated information provided by our payors.
Current wording
Medical services expense increased by 91% due primarily to average membership growth of 69%, which was attributable to six new geographies that became operational in 2023 as well as growth in our existing geographies. The increase in medical services expense was also driven by an increase in average medical services expense per member of 14%. During 2023, we experienced an increase in medical claims expenses attributable to higher-than-expected utilization. The increase in medical service utilization trends became visible during the fourth quarter as a result of additional updated information provided by our payors.
Previous wording
General and administrative expenses increased $78.0 million, or 38%, for the year ended December 31, 2023 compared to 2022. Operating costs to support our live geographies and enterprise functions (platform support costs) increased by $36.2 million to $163.7 million in 2023 compared to $147.5 million in 2022 due primarily to growth in operating costs incurred to support geographies that became operational in 2023. Operating costs to support our live geographies and enterprise functions as a percentage of revenue decreased to 5% for the year ended December 31, 2023 compared to 7% for the same period in 2022. Investments to support geography entry increased to $43.9 million in 2023, compared to $20.6 million in 2022 due to increased costs associated with our geographies that become operational in the following calendar year.
Current wording
General and administrative expenses decreased $78.0 million, or 38%, for the year ended December 31, 2023 compared to 2022. Operating costs to support our live geographies and enterprise functions (platform support costs) increased by $36.2 million to $163.7 million in 2023 compared to $147.5 million in 2022 due primarily to growth in operating costs incurred to support geographies that became operational in 2023. Operating costs to support our live geographies and enterprise functions as a percentage of revenue decreased to 5% for the year ended December 31, 2023 compared to 7% for the same period in 2022. Investments to support geography entry increased to $40.8 million in 2023, compared to $43.9 million in 2022 due to increased costs associated with our geographies that become operational in the following calendar year.
Previous wording
Income (loss) from equity method investments increased $5.8 million, or 54%, for the year ended December 31, 2023 compared to 2022 primarily from our ACO REACH equity investments as a result of stronger performance driven primarily by increased medical margin during 2023 compared to 2022. The increase in income from equity method investments were partially offset by $15.2 million of additional expenses related to certain physician partners that elected to reduce their compensation percentage in current and future years in exchange for agilon common stock.
Current wording
Income (loss) from equity method investments increased $5.8 million, or 54%, for the year ended 2023 compared to 2022 primarily from our CMS ACO Models investments as a result of stronger performance driven primarily by increased medical margin during 2023 compared to 2022. The increase in income from equity method investments were partially offset by $15.2 million of additional expenses related to certain physician partners that elected to reduce their compensation percentage in current and future years in exchange for our common stock.
Previous wording
(2)The year ended December 31, 2023 includes $15.2 million of physician compensation expenses to reduce the physician partners’ compensation percentage in current and future years in exchange for the Company’s common stock.
Current wording
(1)Includes elimination of certain administrative services provided by us to our equity method investments. The year ended December 31, 2023 includes $15.2 million of physician compensation expenses to reduce the physician partners’ compensation percentage in current and future years in exchange for our common stock.
Previous wording
As of December 31, 2023, we had cash and cash equivalents of $107.6 million and investments in marketable securities of $380.8 million.
Current wording
As of December 31, 2024, we had cash and cash equivalents of $188.2 million and investments in marketable securities of $211.7 million.
Previous wording
Based on our planned operations, we believe that our existing cash and cash equivalents, as well as available borrowing capacity under the Credit Facility, will be sufficient to meet our working capital and capital expenditure needs over at least the next 12 months, though we may require additional capital resources in the future. We have based these estimates on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect.
Current wording
Based on our planned operations, we believe that our existing cash and cash equivalents, investments in marketable securities, as well as available borrowing capacity under the Credit Facility, will be sufficient to meet our working capital and capital expenditure needs over at least the next 12 months, though we may require additional capital resources in the future (i.e., beyond the next 12 months). We have based these estimates on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect.
Previous wording
Our ability to pay dividends to holders of our common stock is significantly limited as a practical matter by our growth plans as well as the Credit Facility insofar as we may seek to pay dividends out of funds made available to us by agilon management or its subsidiaries because the Credit Facility restrict agilon management’s ability to pay dividends or make loans to us. The borrower on the Credit Facility is agilon management, our wholly-owned subsidiary. The Credit Facility is guaranteed by certain of our subsidiaries, including those identified as variable interest entities, and contain customary covenants including, among other things, limitations on restricted payments such as: (i) dividends and distributions from restricted subsidiaries, (ii) requirements of minimum financial ratios, and (iii) limitation on additional borrowings based on certain financial ratios.
Current wording
Our ability to pay dividends to holders of our common stock is significantly limited as a practical matter by our growth plans as well as the Credit Facility insofar as we may seek to pay dividends out of funds made available to us by agilon health management, inc. or its subsidiaries because the Credit Facility restricts agilon health management, inc.’s ability to pay dividends or make loans to us. The borrower on the Credit Facility is agilon health management, inc., our wholly-owned subsidiary. The Credit Facility is guaranteed by certain of our subsidiaries, including those identified as variable interest entities, and contain customary covenants including, among other things, limitations on restricted payments such as: (i) dividends and distributions from restricted subsidiaries, (ii) requirements of minimum financial ratios, and (iii) limitation on additional borrowings based on certain financial ratios.
Previous wording
Net cash used in operating activities was $156.2 million for the year ended December 31, 2023 compared to $130.8 million and $148.2 million for the years ended December 31, 2022 and 2021, respectively. The increase in net cash used in operating activities in 2023 compared to 2022 was primarily a result of increased provider costs, including partner physician incentive expenses, and the timing of settlements with payors from new and existing geographies, partially offset by the increase in gross profit contributed from new and existing geographies. The decrease in net cash used in operating activities in 2022 compared to 2021 was primarily a result of the increase in medical margin contributed from new and existing geographies, partially offset by increased provider costs, including partner physician incentive expenses and the timing of settlements with payors from new and existing geographies.
Current wording
Net cash used in operating activities was $57.8 million for the year ended December 31, 2024 compared to $156.2 million and $130.8 million for the years ended December 31, 2023 and 2022, respectively. The decrease in net cash used in operating activities in 2024 compared to 2023 was primarily a result of decreased provider costs, including partner physician incentive expenses, and the timing of settlements with payors from new and existing geographies, partially offset by the increase in gross profit contributed from new and existing geographies. The increase in net cash used in operating activities in 2023 compared to 2022 was primarily a result of the increase in medical margin contributed from new and existing geographies, partially offset by increased provider costs, including partner physician incentive expenses and the timing of settlements with payors from new and existing geographies.
Previous wording
Net cash used in investing activities was $44.0 million for the year ended December 31, 2023 compared to $444.4 million and $90.5 million for the years ended and December 31, 2022 and 2021, respectively. Cash used in investing activities in 2023 was due primarily for the acquisition of our My Personal Health Record Express, Inc. acquisition for $44.4 million in 2023. The increase in net cash used in investing activities in 2022 compared to 2021 was due primarily to investments in marketable securities of $458.3 million during 2022.
Current wording
Net cash provided by investing activities was $139.9 million for the year ended December 31, 2024, compared to net cash used in investing activities of $44.0 million and $444.4 million for the years ended and December 31, 2023 and 2022, respectively. Net cash provided by investing activities in 2024 was due primarily to maturities of marketable securities of $206.9 million. Net cash used in investing activities in 2023 was due primarily for the acquisition of My Personal Health Record Express, Inc. for $44.4 million. Net cash used in investing activities in 2022 was due primarily to investments in marketable securities of $458.3 million.
Previous wording
Net cash used in financing activities was $193.1 million for the year ended December 31, 2023 compared to net cash provided by financing activities of $28.1 million and $1.15 billion for the years ended December 31, 2022 and 2021, respectively. During the year ended December 31, 2023, we used $200.0 million to repurchase our common stock. During the year ended December 31, 2022, we received net proceeds of $33.1 million from the exercise of stock options. In February 2021, we refinanced our existing debt with a $100.0 million term loan, receiving net proceeds of $30.1 million. In April 2021, we received net proceeds of approximately $1.2 billion upon the completion of our IPO, after deducting underwriting discounts and commissions and offering costs. Upon completion of our IPO in April 2021, we repaid $50.0 million of the term loan as required under the terms of our credit facility.
Current wording
Net cash used in financing activities was $2.6 million and $193.1 million for the years ended December 31, 2024 and 2023, respectively, compared to net cash provided by financing activities of $28.1 million for the year ended December 31, 2022. During the year ended December 31, 2023, we used $200.0 million to repurchase our common stock. During the year ended December 31, 2022, we received net proceeds of $33.1 million from the exercise of stock options.
Previous wording
On February 18, 2021, we executed a credit facility agreement (as amended by the First Amendment to Credit Agreement, dated as of March 1, 2021 and the Second Amendment to Credit Agreement, dated as of May 25, 2023. The Credit Facility includes: (i) a $100.0 million senior secured term loan (the “Secured Term Loan Facility”) and (ii) a $100.0 million senior secured revolving credit facility (the “Secured Revolving Facility”) with a capacity to issue standby letters of credit in certain circumstances up to a maximum of $100.0 million. Subject to specified conditions and receipt of commitments, the Secured Term Loan Facility may be expanded (or a new term loan facility, revolving credit facility or letter of credit facility added) by up to (i) $50.0 million plus (ii) an additional amount determined in accordance with a formula tied to repayment of certain of our indebtedness. The maturity date of the Credit Facility was extended to February 18, 2026.
Current wording
On February 18, 2021, we executed a credit facility agreement (as amended by the First Amendment to Credit Agreement, dated as of March 1, 2021 and the Second Amendment to Credit Agreement, dated as of May 25, 2023. The Credit Facility includes: (i) a $100.0 million senior secured term loan (the “Secured Term Loan Facility”) and (ii) a $100.0 million senior secured revolving credit facility (the “Secured Revolving Facility”) with a capacity to issue standby letters of credit in certain circumstances up to a maximum of $100.0 million. Subject to specified conditions and receipt of commitments, the Secured Term Loan Facility may be expanded (or a new term loan facility, revolving credit facility or letter of credit facility added) by up to (i) $50.0 million plus (ii) an additional amount determined in accordance with a formula tied to repayment of certain of our indebtedness. The maturity date of the Credit Facility is February 18, 2026.
Previous wording
Effective with the Second Amendment to Credit Agreement on May 25, 2023, we transitioned to the Secured Overnight Financing Rate (“SOFR”) as a benchmark interest rate used in the credit agreement. At our option, borrowings under the credit agreement can be either: (i) SOFR Rate Loans, (ii) Daily Simple SOFR Rate Loans, or (iii) Base Rate Loans. Daily Simple SOFR Rate Loans and SOFR Rate Loans bear interest at a rate equal to the sum of 3.50% and the higher of (a) SOFR, as defined in the credit agreement, and (b) 0%. Base Rate Loans bear interest at a rate equal to the sum of 2.50% and the highest of: (a) 0.50% in excess of the overnight federal funds rate, (b) the prime rate established by the administrative agent from time to time, (c) the one-month LIBO rate (adjusted for maximum reserves) plus 1.00% and (d) 0%. Additionally, we pay a commitment fee on the unfunded 2021 Secured Revolving Facility amount of 0.375%. We must also pay customary letter of credit fees.
Current wording
Effective with the Second Amendment to Credit Agreement on May 25, 2023, we transitioned to the Secured Overnight Financing Rate (“SOFR”) as a benchmark interest rate used in the credit agreement. At our option, borrowings under the credit agreement can be either: (i) SOFR Rate Loans, (ii) Daily Simple SOFR Rate Loans, or (iii) Base Rate Loans. Daily Simple SOFR Rate Loans and SOFR Rate Loans bear interest at a rate equal to the sum of 3.50% and the higher of (a) SOFR, as defined in the credit agreement, and (b) 0%. Base Rate Loans bear interest at a rate equal to the sum of 2.50% and the highest of: (a) 0.50% in excess of the overnight federal funds rate, (b) the prime rate established by the administrative agent from time to time, (c) the one-month SOFR rate (adjusted for maximum reserves) plus 1.00% and (d) 0%. Additionally, we pay a commitment fee on the unfunded Secured Revolving Facility amount of 0.375%. We must also pay customary letter of credit fees.
Previous wording
For additional discussion on our debt obligations, see Note 11 to the Consolidated Financial Statements.
Current wording
For additional discussion on our debt obligations, see Note 11 to the Consolidated Financial Statements in Item 8 of this Report.
Previous wording
As of December 31, 2023, we had 406.4 million shares of common stock outstanding. See Note 13 to the Consolidated Financial Statements for additional information about our equity transactions.
Current wording
As of December 31, 2024, we had 412.2 million shares of common stock outstanding. See Note 13 to the Consolidated Financial Statements in Item 8 of this Report for additional information about our equity transactions.
Previous wording
(1)See Note 11 for additional information regarding the maturities of debt principal. Interest payments on debt are calculated using outstanding balances and interest rates in effect on December 31, 2023.
Current wording
(1)See Note 11 to the Consolidated Financials Statements in Item 8 of this Report for additional information regarding the maturities of debt principal. Interest payments on debt are calculated using outstanding balances and interest rates in effect on December 31, 2024.
Previous wording
(2)See Note 6 for additional information regarding the maturity of lease liabilities under operating leases.
Current wording
(2)See Note 6 to the Consolidated Financials Statements in Item 8 of this Report for additional information regarding the maturity of lease liabilities under operating leases.
Previous wording
(3)See Note 12 for additional information regarding capital commitments to physician partners to support physician partner expansion and related purposes.
Current wording
(3)See Note 12 to the Consolidated Financials Statements in Item 8 of this Report for additional information regarding capital commitments to physician partners to support physician partner expansion and related purposes.
Previous wording
Management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of financial statements in conformity with U.S. GAAP requires us to use judgment in the application of accounting policies, including making estimates and assumptions. We base estimates on the best information available to us at the time, our historical experience, known trends and events and various other assumptions that we believe are reasonable under the circumstances. These estimates affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. If our judgment or interpretation of the facts and circumstances relating to various transactions or other matters had been different, it is possible that different accounting would have been applied, resulting in a different presentation of our consolidated financial statements. From time to time, we re-evaluate our estimates and assumptions. In the event estimates or assumptions prove to be different from actual results, adjustments are made in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. For a more detailed discussion of our significant accounting policies, see Note 2 to the Consolidated Financial Statements. Below is a discussion of accounting policies that we consider critical in that they may require complex judgment in their application or require estimates about matters that are inherently uncertain.
Current wording
Management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of financial statements in conformity with U.S. GAAP requires us to use judgment in the application of accounting policies, including making estimates and assumptions. We base estimates on the best information available to us at the time, our historical experience, known trends and events and various other assumptions that we believe are reasonable under the circumstances. These estimates affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. If our judgment or interpretation of the facts and circumstances relating to various transactions or other matters had been different, it is possible that different accounting would have been applied, resulting in a different presentation of our consolidated financial statements. From time to time, we re-evaluate our estimates and assumptions. In the event estimates or assumptions prove to be different from actual results, adjustments are made in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. For a more detailed discussion of our significant accounting policies, see Note 2 to the Consolidated Financial Statements in Item 8 of this Report. Below is a discussion of accounting policies that we consider critical in that they may require complex judgment in their application or require estimates about matters that are inherently uncertain.
Previous wording
For the impact of new accounting standards, see Note 2 to the Consolidated Financial Statements.
Current wording
For the impact of new accounting standards, see Note 2 to the Consolidated Financial Statements in Item 8 of this Report.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
Income (loss) from equity method investments
Current report — wording carried from elsewhere
Income (loss) from equity method investments
Current report — wording carried from elsewhere
Discontinued operations generated losses of $67.6 million for the year ended December 31, 2023 compared to $14.6 million in 2022. In 2023, we completed the disposition of our Hawaii operations and recognized a loss on sale of assets of $47.5 million. For additional discussion related to discontinued operations, see Note 20 to the Consolidated Financial Statements in Item 8 of this Report.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Other income (expense), net generated income of $13.9 million for the year ended December 31, 2022 compared to $2.2 million in 2021 primarily as a result of our marketable securities investments in 2022.
Previous report — wording carried elsewhere
Our investment strategies are designed to provide safety and preservation of capital, sufficient liquidity to meet the cash flow needs of our business operations, and attainment of a competitive return.