Claritev Corp

Table of Content

Notes to Consolidated Financial Statements

1. General Information

Claritev Corporation (collectively, the "Company", "we", "us", or "our") isa technology, data and insights company focused on improving transparency, affordability and quality across the healthcare system. We bring objective, market-based insights to some of the healthcare system's most complex decisions based on decades of claims expertise. By applying data, analytics and experience, we help organizations across the healthcare ecosystem better understand costs, pricing and payment dynamics.

On February 17, 2025, the Company changed its name from "MultiPlan Corporation" to "Claritev Corporation". The Company's Class A common stock ceased trading under the ticker symbol "MPLN" and began trading under its new ticker symbol, "CTEV", on the New York Stock Exchange, effective on February 28, 2025.

Reverse Stock Split

On September 20, 2024, the Company effected a one-for-forty (1-for-40) reverse stock split of its Class A common stock (the "Reverse Stock Split").

References to Class A common stock, warrants to purchase Class A common stock, options to purchase Class A common stock, restricted stock units, share data, per share data and conversion rates with respect to convertible notes and related information contained in the consolidated financial statements have been retroactively adjusted to reflect the effect of the Reverse Stock Split for all periods presented.

2. Summary of Significant Accounting Policies

Within the Notes to the Consolidated Financial Statements, we use "client(s)" synonymously with "customer(s)," and the terms should be understood as interchangeable.

Basis of Presentation and Consolidation

The accompanying consolidated financial statements have been prepared in conformity with GAAP, and with the instructions to Form 10-K and Article 10 of SEC, Regulation S-X. The consolidated financial statements present the financial position, results of operations, shareholders' (deficit)/equity, and cash flows of the Company, including the accounts of all subsidiaries, all of which are wholly owned or in which the Company has a controlling interest. All intercompany transactions have been eliminated in consolidation.

Certain balances from the prior periods have been reclassified to conform to the current period presentation in the consolidated financial statements.

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting periods. Actual results could differ from the Company's estimates. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, revenue recognition, recoverability of long-lived assets, goodwill, valuation of stock-based compensation awards and income taxes.

Business Combinations

The Company determines whether substantially all the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If this threshold is met, the set is not a business. If it is not met, the Company then evaluates whether the set meets the requirement that a business include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs.

Business combinations are accounted for using the acquisition method at the acquisition date, which is when control is obtained. The consideration transferred is generally measured at fair value, as are the identifiable assets acquired and liabilities assumed. During the one-year period following the acquisition date, if an adjustment is identified based on new information about facts and circumstances that existed as of the acquisition date, the Company will record measurement-period adjustments related to the acquisitions in the period in which the adjustment is identified.

Goodwill is measured at the acquisition date as the fair value of the consideration transferred (including, if applicable, the fair value of any previously held equity interest and any non-controlling interests) less the net recognized amount (which is generally the fair value) of the identifiable assets acquired and liabilities assumed.

Transaction costs, other than those associated with the issuance of debt or equity securities incurred in connection with a business combination, are expensed as incurred and included in General and administrative expenses in the consolidated statements of operations and comprehensive loss.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The carrying amount of these investments approximates fair value due to the short maturity of those investments. The Company had deposits inthree major financial institutions that exceeded Federal Deposit Insurance Corporation insurance limits. Management believes the credit risk related to these deposits is minimal.

Restricted Cash

In accordance with local insurance regulations, our insurance captive is required to meet and maintain minimum solvency capital requirements. The cash and cash equivalents held by our insurance captive have been classified in the line item Restricted cash on the consolidated balance sheets because the assets are not available to satisfy our current obligations. See the Insurance section of this footnote for additional information on our captive insurance company.

Trade Accounts Receivable

Trade accounts receivable are stated at the net amount expected to be collected, using an expected credit losses methodology that is referred to as the current expected credit losses ("CECL") model.

The Company is paid for virtually all of its services by insurance companies, third-party administrators and employers. Management estimates constraints on variable consideration for anticipated contractual billing adjustments that its clients or the Company may make to invoiced amounts; refer to Revenue Recognition accounting policies for additional detail. Management also maintains allowances for expected credit losses resulting from the Company's clients' inability to make required payments. The Company establishes an allowance for expected credit losses based upon historical collection experience, current and future economic and market conditions and a specific client's credit risk.

Management regularly evaluates the adequacy of the assumptions used in determining these allowances and adjusts as necessary. Changes in estimates are recognized in the period in which they are determined. Management writes off accounts after all substantial collection efforts have failed and any resulting losses are included in General and administrative expenses in the consolidated statements of operations and comprehensive loss.

The following table summarizes the activity in the Company’s allowance for expected credit losses balance (in thousands):

Unbilled IDR Fees

As part of our surprise billing services, we help our clients with federal disputes take claims through an IDR process and we advance payment of IDR fees on their behalf. IDR fees include an administrative fee to cover the costs for administration of the IDR process; and an Independent Dispute Resolution Entity ("IDRE") fee to cover dispute resolution services. These IDR fees are then collected from either our clients or the IDREs, depending on the outcome of the dispute.

Unbilled IDR Fees are stated at the net amount expected to be collected, using an expected credit losses methodology that is referred to as the CECL model.

Property and Equipment

Property and equipment are stated at historical cost less accumulated depreciation and accumulated impairment losses, if any. Major expenditures for property and equipment and those that substantially increase useful lives are capitalized. Direct internal and external costs of developing software for internal use, including programming and enhancements, are capitalized and amortized over the estimated useful lives once the software is ready for its intended use. Software training costs, maintenance and repairs are expensed as incurred. When assets are sold or otherwise disposed of, costs and related accumulated depreciation are removed from the financial statements and any resulting gains or losses are included in Costs of services and General and administrative expenses in the consolidated statements of operations and comprehensive loss.

The Company provides for depreciation and amortization on property and equipment using the straight-line method to allocate the cost of depreciable assets over their estimated lives as follows:

Internal-use software development costs incurred in the preliminary project stage are expensed as incurred; costs incurred in the application and development stage, that meet the capitalization criteria, are capitalized and amortized on a straight-line basis over the estimated useful life of the asset, generally five years; and costs incurred in the post-implementation/operations stage are expensed as incurred.

Cloud Computing Arrangements

The Company incurs costs to implement cloud computing arrangements that are hosted by a third-party vendor. For cloud computing arrangements that do not include a software license, implementation costs incurred during the application development stage are capitalized until the software is ready for its intended use. The costs are then amortized on a straight-line basis over the term of the associated hosting arrangement and are recognized asother general and administrative expenses in the consolidated statements of operations and comprehensive loss. Capitalized costs related to cloud computing arrangements, net of accumulated amortization, are reported as a component of Other current assets and Other assets on the consolidated balance sheets.

Capitalized costs to implement cloud computing arrangements, net of accumulated amortization were as follows (in thousands):

Amortization expenses associated with the implementation of cloud computing arrangements was $2.8 million for the year ended December 31, 2025. No cloud computing amortization expenses were incurred during the years ended December 31, 2024 and 2023.

Goodwill and Other Intangible Assets

Goodwill is calculated as the excess of the purchase price in an acquisition over the fair value of identifiable net assets acquired. Acquired intangible assets are separately recognized if the benefit of the intangible asset is obtained through contractual or other legal rights, or if the intangible asset can be sold, transferred, licensed, rented, or exchanged, regardless of the Company's intent to do so.

The Company tests goodwill for impairment on an annual basis as of November 1, or more frequently if events or circumstances indicate a potential impairment. The impairment assessment compares the fair value of the reporting unit to its carrying value. Impairment is measured as the amount by which the carrying value of the reporting unit exceeds its fair value.

Factors that may trigger an impairment review include but are not limited to:

•significant underperformance relative to expected historical or projected future operating results;

•significant changes in the manner of use of the acquired assets or the strategy for the overall business;

•significant decline in the trading price of our Class A common stock; and

•significant negative industry or economic trends.

The Company tests its goodwill for impairment on a reporting unit basis. A reporting unit is the operating segment unless, at businesses one level below the operating segment (the component level), discrete financial information is prepared and regularly reviewed by management and the businesses are not otherwise aggregated due to having certain common characteristics, in which case such component is the reporting unit.

We have the option to assess goodwill for impairment by initially performing a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If we determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then the quantitative goodwill impairment test is not required to be performed. If we determine that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, or if we do not elect the option to perform an initial qualitative assessment, we perform a quantitative goodwill impairment test.

In the quantitative impairment test of goodwill, we calculate the estimated enterprise fair value of the reporting unit using a (i) discounted cash flow analysis, (ii) forecasted EBITDA trading multiples for comparable publicly traded companies and (iii) historical EBITDA multiples for comparable acquisitions, giving equal weight to the three approaches. Assumptions used in the discounted cash flow analysis include forecasted revenues, terminal growth rate, forecasted expenses and the discount rate. The fair value measurements are based on significant unobservable inputs and thus represent Level 3 inputs. This estimated enterprise fair value is then reconciled to our market enterprise value at year end within an appropriate implied market participant acquisition premium. Our market enterprise value is defined as our market capitalization plus our long-term debt, less our cash and cash equivalents and our non-operating assets. An implied market participant acquisition premium represents the additional value a buyer would pay to obtain control of the respective reporting unit because having control would lead to either higher cash flows, lower cost of capital or both. The carrying amount of the reporting unit consists of all assets and liabilities used to operate the reporting unit and if that carrying amount of the reporting unit after all of the reporting unit's other assets (excluding goodwill) have been adjusted for impairment exceeds the estimated fair value, an impairment charge is recorded for the amount that its carrying amount, including goodwill, exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit.

Indefinite-lived intangible assets, such as certain trademarks with indefinite lives, are subject to an impairment review annually and whenever indicators of impairment exist. We have the option to assess indefinite-lived intangible assets for impairment by first performing qualitative assessments to determine whether it is more-likely-than-not that the fair values of the indefinite-lived intangible assets are less than the carrying amounts. If we determine that it is more-likely-than-not that an indefinite-lived intangible asset is impaired, or if we elect not to perform an initial qualitative assessment, we then perform the quantitative impairment test by comparing the fair value of the indefinite-lived intangible asset with its carrying amount. In the quantitative impairment test of our indefinite-lived intangibles, we calculate the estimated fair value using the relief from royalty method. Under this method a royalty rate based on observed market royalties is applied to projected revenue supporting the trademarks and discounted to present value. As of December 31, 2024 and 2025, the Company no longer recorded any indefinite-lived intangibles.

The value of definite-lived intangible assets is recorded at their acquisition date fair value and amortized on a straight-line basis over their estimated lives. The Company tests definite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. We measure recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows that the assets or the asset group are expected to generate. If the assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair market value. No definite-lived intangible asset impairment was identified in any of the periods presented.

Following is a summary of the range of estimated useful life of other intangible assets:

Non-Controlling Interests

Non-controlling interests ("NCI") reflect the portion of income or loss and corresponding equity attributable to third-party equity holders in certain consolidated subsidiaries that are not 100% owned by the Company. The equity interests of third-party equity holders are shown on the consolidated balance sheets in the shareholders’ (deficit)/equity section as non-controlling interests and are adjusted each period to reflect the third-party equity holders’ share of the net income (loss) as well as any cash distributions or contributions to the third-party equity holders for the period. Non-controlling interests are presented as separate components of shareholders' (deficit)/equity on the Company's consolidated balance sheets to clearly distinguish between the Company's interests and the economic interests of third parties in those entities. The third-party equity holders’ share of the net income (loss) in the limited liability company is shown as non-controlling interest income (loss) in the consolidated statements of operations. All inter-company accounts and transactions are eliminated.

Our NCI currently consist of one limited liability company ("LLC") in which the Company holds 51% ownership and the non-controlling party holds 49% ownership. The Company also holds majority seats within the Board of Managers. NCI in the LLC are allocated a share of income (loss) in the LCC in proportion to their relative ownership interests, after consideration of contractual arrangements that govern allocation of income or loss. See Note 11. Shareholders' (Deficit)/Equity for additional details.

Revenue Recognition

All revenue recognized in the consolidated statements of operations and comprehensive loss is derived from contracts with clients, as defined under ASC 606-10-15-3.

Revenue is generated from the compensation received from healthcare payers in exchange for various cost management services and solutions. Our solution offerings include the following: (i) Claims intelligence solutions that use its leading and proprietary information technology platform to offer clients analytics-based solutions to reduce medical costs, (ii) Network solutions that process claims at a discount compared to billed fee-for-service rates while using an extensive network and (iii) Payment and revenue integrity solutions that use data, technology and clinical expertise to identify improper, unnecessary and excessive charges. Compensation from payers includes (1) commissions received for each claim based on the PSAV achieved compared to the providers' billed fee-for service rates and (2) fees for standing ready to provide cost management solutions for each covered member, which are based on a PEPM.

Our performance obligation to the client for a PSAV arrangement is the cost management solutions provided for each submitted claim, regardless of the solution offering used to achieve savings, as they are not distinct in the context of the contract. Our performance obligation for PEPM arrangements is to stand ready to process and achieve savings for all covered members each month.

For services performed under a PSAV arrangement, the Company enters into a contract with the client once the claim is submitted. Revenue under a PSAV arrangement is entirely variable and estimated using the expected value method obtained by applying the contractual rates to the materialized savings that can be reliably estimated leveraging extensive historical data of results obtained for claims of similar nature. Revenue is recognized at a point in time where the client obtains control over the service promised by the Company, which generally occurs when the Company successfully transfers the savings for the claim to the client. Judgment is not typically required when assessing whether the savings have materialized.

Fees from clients for standing ready to provide cost management solutions for each client's members each month vary depending on the number of employees covered each month. PEPM contracts represent a series of performance obligations to stand ready to provide cost management solutions to our clients' covered employees on a monthly basis with each time increment representing a distinct service. We recognize revenue over time using the time elapsed input method. In accordance with the series guidance, we allocate variable consideration to the period to which the fees relate.

Variable consideration is estimated using the expected value method based on our historical experience and best judgment at the time. Due to the nature of our arrangements, certain estimates may be constrained if it is probable that a significant reversal of revenue will occur when the uncertainty is resolved. For our PSAV contracts, portions of revenue that are recognized and collected in a reporting period may be returned or credited in subsequent periods. These credits are the result of payers not utilizing the discounts that were initially calculated, or differences between the Company's estimates of savings achieved for a client and the amounts self-reported in the following month by that same client. Significant judgment is required to estimate constrained variable consideration. We estimate constrained variable consideration based upon client-specific and aggregated factors as well as historical payment yields in addition to client contractual terms and performance guarantees. When assessing the estimate of variable consideration, the period of historical experience considered as part of the expected value method requires significant management judgment. We update our estimates at the end of each reporting period as additional information becomes available.

The timing of payments from clients from time to time generates contract assets or contract liabilities; however, these amounts are immaterial in all periods presented.

Payment terms vary on a contract-by-contract basis, although terms generally include a requirement of payment within 15 to 30 days. We do not have any significant financing components in our contracts with clients.

The Company expenses sales commissions and other costs to obtain a contract when incurred, because our commissions are deemed contingent on factors broader than the simple intention of the contracts and cannot be considered directly incremental. These costs are recorded within Cost of services in the consolidated statements of operations and comprehensive loss.

Practical Expedients and Accounting Policy Elections

The Company excludes sales taxes and other similar taxes from the measurement of the transaction price.

The Company does not disclose the value of unsatisfied performance obligations, nor do we disclose the timing of revenue recognition for contracts with an original expected length of one year or less.

The Company uses a portfolio approach when estimating the amount of consideration it expects to receive from certain classes of client contracts with similar characteristics and expects that the difference from applying the new revenue standard to a portfolio of contracts as compared to an individual contract would not result in a material effect on the financial statements.

Disaggregation of Revenue

The following table presents revenues disaggregated by solutions and contract types (in thousands):

The Company currently reports revenues from data and analytics solutions in claims intelligence solutions and will likely do so until revenues from this solution line become more significant.

Costs of Services

Costs of services consist of all costs specifically associated with claims processing activities for clients, sales and marketing and the development and maintenance of the Company's networks and analytics-based solutions.

Insurance

The Company employs various risk transfer methodologies through the use of the various insurance policies it purchases, including, for certain risks, through its wholly-owned captive insurance subsidiary. These methodologies include the use of large deductible programs and self-insured retentions with stop loss limits. Coverages for risks related to errors and omissions liability, directors and officers liability, fiduciary liability, cybersecurity, employment practices liability, property and casualty and crime insurance utilize self-insured retentions subject to an annual aggregate limit. These self-insured retentions range up to $10,000,000 per claim. The Company retains the services of a global insurance broker to assess current risk and exposure levels as a standalone entity. The appropriate types and levels of coverage were determined by the Company and the Company had active policies providing the desired level of coverage deemed necessary by the Company.

Health insurance and employee benefits are self-insured by the Company, subject to a participant's deductible amounts. The Company uses historical claim data and loss trends to project incurred losses and record loss reserves. Other factors utilized in determining loss reserves include, but are not limited to, the amount and timing of historical payments, severity of individual claims, jurisdictional considerations, the anticipated future volume of claims, the life span of various types of claims and input from the Company's legal representatives responsible for the defense of these claims. The ultimate value of casualty claims (primarily general liability) and professional liability (primarily errors and omissions) claims may take several years before becoming known. Liabilities associated with the risks that are retained by the Company are not discounted.

The Company’s wholly-owned captive insurance subsidiary receives direct premiums, which are netted against the Company’s insurance company costs in General and administrative expenses in the consolidated statements of operations and comprehensive loss.

Stock-Based Compensation

The Company's awards are granted via the 2020 Omnibus Incentive Plan in the form of restricted stock awarded to certain employees ("Employee RS"), restricted stock units awarded to certain employees ("Employee RSUs"), restricted stock units granted to certain employees based on a fixed monetary amount ("Fixed Value RSUs"), cash settled restricted stock units granted to certain employees ("cRSUs"), non-qualified stock options awarded to certain employees (the "Employee NQSOs"), and performance stock units awarded to certain employees ("Employee PSUs" and together with the Employee RS, Employee RSUs, Fixed Value RSUs, cRSUs, the "employee awards"), and restricted stock unit awards to non-employee directors (the "Director RSUs"). The Company has also granted awards of Employee RSUs and Employee NQSOs outside of the 2020 Omnibus Incentive Plan pursuant to the NYSE's listing rules relating to inducement grants. Such grants made outside the 2020 Omnibus Incentive Plan are generally subject to the same terms and conditions that apply to awards granted under the 2020 Omnibus Incentive Plan and are approved by the Compensation Committee. The Company also issues shares via the Claritev Corporation 2023 Employee Stock Purchase Plan (as amended, the "ESPP").

The PSUs vest approximately three years after grant if certain performance metrics are met, as follows:50% of the PSUs, or the RTSR PSUs, may be earned based on the Company’s relative total shareholder return over the measurement period from January 1, 2024 to December 31, 2026 compared to the Russel 2000 (the RTSR PSUs"), and 50% of the PSUs, or the revenue PSUs, may be earned based on the cumulative revenue from January 1, 2024 to December 31, 2025 (the "Revenue PSUs").

In 2025, the Company began granting a new type of award via the 2020 Omnibus Incentive Plan, in the form of cRSUs. The Company granted 565.6 thousand shares with a fair value at grant date of $8.2 million. The cRSUs vest in two tranches, one-half on each of the first and second anniversaries of the date of the grant. Each tranche of cRSUs is entitled to receive a cash payment equivalent to the fair market value of Class A common stock on the vesting date, subject to a cap of 4.0 x the fair market value of Class A common stock on the grant date.

Stock-based compensation is measured at the grant date based on the fair value of the award and is recognized as compensation expense for employee awards, net of forfeitures, over the applicable requisite service period of the stock award using the straight-line method for awards with only service conditions. The compensation expense for Director RSUs is recognized in the same period(s) and in the same manner as if the Company had paid cash in exchange for the goods or services instead of a share-based award. The Company recognizes forfeitures as they occur.

We determine the fair value of the Employee RS, Employee RSUs, and Director RSUs with time based vesting using the value on our Class A common stock on the date of the grant.

We determine the fair value of Employee NQSOs with an exercise price equal to the price of the Company's Class A common stock on the grant date ("at-the-money") using a Black-Scholes option pricing model while taking into consideration the price of the Company's Class A common stock, vesting conditions, and the expected term obtained using the simplified method of averaging the vesting term and the original contractual term of the options. The fair value of Employee NQSOs with an exercise price higher than the Company's Class A common stock on the grant date ("out-of-the-money") is estimated on the date of grant using a binomial-lattice option pricing model while taking into consideration the price of the Company's Class A common stock, vesting conditions, and a sub optimal exercise factor calibrated to the valuation obtained from the Black-Scholes option pricing model used for a hypothetical at-the-money option with the same vesting schedules.

The fair value assigned to PSUs is determined using the market price of the Company’s stock on the grant date for the performance based awards for the Revenue PSUs, and by using a Monte Carlo simulation for the market based awards for the RTSR PSUs. Stock-based compensation costs associated with awards with a performance condition are re-assessed each reporting period based upon the estimated performance attainment on the reporting date until the performance conditions are met. The ultimate number of shares of Class A common stock that are issued to an employee is the result of the actual performance of the Company at the end of the performance period compared to the performance targets and ranges from 0% to 150% of the initial PSU grant.

The Monte Carlo simulation model uses the same input assumptions as the Black-Scholes option pricing model to determine the expected potential ranking of the Company against the Russell 2000 Index, i.e. the probability of satisfying the market condition defined in the award. Expected volatility in the model was estimated based on the volatility of historical stock prices over a period matching the expected term of the award. The risk-free interest rate is based on U.S. Treasury yield constant maturities for a term matching the expected term of the award.

We determine the fair value of the Fixed Value RSUs using the fixed dollar amount of the award. The Fixed Value RSUs are classified as liabilities.

Certain assumptions used in the model are subjective and require significant management judgment, and include the (i) risk-free rate, (ii) volatility, (iii) expected term, and (iv) suboptimal exercise factor. The Company incorporates company-specific historical volatility in its expected stock volatility estimates. The risk-free interest rate is based on the interpolated 5- and 7-year U.S. Treasury constant maturity yields. Changes in these assumptions can materially affect the estimate of the grant date fair value of the Employee NQSOs and ultimately compensation expenses.

We determine the fair value of the cRSUs using the market price of the Company's stock on the reporting date minus a call option valued using the Black-Scholes option pricing model. Expected volatility in the model was estimated based on the volatility of historical stock prices over a period matching the expected term of the award or one-year period if the expected term of the award is less than a year. The risk-free interest rate is based on U.S. Treasury yield constant maturities for a term matching the expected term of the award. We classify the cRSUs as a liability included in Accrued compensation on the consolidated balance sheets as the vesting results in payment of cash by the Company. The cRSUs are adjusted to fair value at each reporting date.

The ESPP allows eligible employees to contribute a portion of their base earnings toward the quarterly purchase of our Class A common stock. The purchase price is 85% of the fair market value of the stock on the last business day of the offering period and considered compensatory for financial reporting purposes. Any cash withheld from employees over the course of the purchase period is recorded as a liability, until such time that the cash is either returned to the employee (either at their election or upon their termination of employment prior to the end of the purchase period, if allowed or required by the terms of the ESPP) or used to purchase shares at the end of the purchase period. The Company recognizes forfeitures as they occur.

Client Concentration

Two clients individually accounted for 29.2% and 10.4% of total revenues for the year ended December 31, 2025, and two clients individually accounted for 27.7% and 15.9% of total revenues for the year ended December 31, 2024. The loss of the business of one or more of our larger clients could have a material adverse effect on our results of operations.

Fair Value of Financial Instruments

The carrying amounts of the Company's financial instruments, which include cash and trade accounts receivable, approximate their fair values due to their short maturities.

The fair value of long-term debt was obtained using traded prices by qualified institutional buyers as our long-term debt are not registered securities nor listed on any securities exchange. As such, this is considered a Level 2 fair value measurement. The fair value of interest rate swaps is derived from model-driven information based on observable Level 2 inputs, such as SOFR forward rates.

Derivatives

Interest Rate Swap Agreements

The Company is exposed to interest rate risk on its floating-rate debt. In September 2023, the Company entered into interest rate swap agreements to effectively convert some of its floating-rate debt to a fixed-rate basis. The principal objective of these contracts is to reduce the variability of the cash flows in interest payments associated with the Company’s floating-rate debt, thus reducing the impact of interest rate changes on future interest payment cash flows.

The Company elected to apply the hedge accounting rules in accordance with authoritative guidance. Changes in the fair value of interest rate swap agreements designated as cash flow hedges are recorded as a component of accumulated other comprehensive loss within shareholders’ (deficit)/equity and are subsequently reclassified into interest expense in the same period(s) during which the hedged transaction affects "Earnings."

Income Taxes

The Company accounts for income taxes using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Deferred income tax assets are recognized for deductible temporary differences, net operating loss carry forwards and tax credit carry forwards if it is more likely than not that the tax benefits will be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.

The Company evaluates all factors on a regular basis to determine the amount of deferred income tax assets to recognize in the financial statements, including its recent earnings history, current and projected future taxable income, the number of years its net operating loss and tax credits can be carried forward, the existence of taxable temporary differences and available tax planning strategies.

Earnings per Common Share

The Company calculates basic EPS based on the weighted average number of common shares outstanding for the period.

The Company determines diluted EPS using the weighted-average number of common shares outstanding during the period, adjusted for potentially dilutive shares associated with warrants, shares which may be issued upon conversion of the Senior Convertible PIK Notes, Unvested Founder Shares and awards within the 2020 Omnibus Incentive Plan (collectively, Class A common stock equivalents), using the treasury stock method. The treasury stock method assumes a hypothetical issuance of shares to settle the share-based awards, with the assumed proceeds used to purchase Class A common stock at the average market price for the period. Assumed proceeds include the amount the employee must pay upon exercise and the average unrecognized compensation cost. The difference between the number of shares assumed issued and number of shares assumed purchased represents the dilutive shares. Out-of-the-money Class A common stock equivalents are considered anti-dilutive and are excluded in the computation of diluted EPS.

In periods when the Company records net loss, Class A common stock equivalents are excluded in the computation of diluted EPS because their inclusion would be anti-dilutive.

Balance Sheet Details

Other current assets, net

Other current assets, net consist of the following (in thousands):

Other accrued expenses

Other accrued expenses consist of the following (in thousands):

3. New Accounting Pronouncements

We consider the applicability and impact of all Accounting Standards Updates ("ASUs") and applicable authoritative guidance. The ASUs not listed below were assessed and determined to be either not applicable or are expected to have an immaterial impact on our consolidated financial statements.

Accounting Pronouncements Issued and Adopted

ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740). In December 2023, the Financial Accounting Standards Board ("FASB") issued ASU 2023-09. This standard requires disaggregated information about a reporting entity's effective tax rate reconciliation as well as information on income taxes paid. The standard is effective for public business entities for annual periods beginning after December 15, 2024, with early adoption permitted, and may be applied either prospectively or retrospectively for all prior periods presented. The Company adopted this standard for the year ended December 31, 2025 on a prospective basis and added additional income tax disclosures, see Note 14. Income Taxes for additional details.

Accounting Pronouncements Issued but Not Yet Adopted

ASU 2024-03 Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40). On November 4, 2024, the FASB issued ASU 2024-03, which requires disaggregated disclosure of income statement expenses for public business entities ("PBEs"). This ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. The standard is effective for all PBEs for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the impact of this standard.

ASU 2025-05 Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses for Accounts Receivable and Contract Assets. In July 2025, the FASB issued ASU 2025-05, which reduces the cost and complexity of applying Topic 326 to current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. This ASU introduced a practical expedient, which simplifies the estimation approach used to determine expected credit losses. The standard is effective for all entities for annual and interim periods beginning after December 15, 2025, with early adoption permitted, and applied prospectively. We do not expect the adoption of this standard in 2026 to have a material impact on our consolidated financial statements.

ASU 2025-06 Intangibles - Goodwill and other Internal-Use Software (Subtopic 350-40) - Targeted Improvements to the Accounting for Internal-Use Software. In September 2025, the FASB issued ASU 2025-06, which modernizes the accounting for software costs that are accounted for under Subtopic 350-40. This ASU changes the cost capitalization threshold by eliminating accounting consideration of software project development stages and enhancing the guidance around the "probable-to-complete" threshold. The standard is effective for all entities for annual and interim periods beginning after December 15, 2027, with early adoption permitted, and may be applied using prospective approach, modified transition approach, or retrospective approach for all prior periods presented. We are currently evaluating the impact of this standard.

ASU 2025-09 Derivatives and Hedging (Topic 815) - Hedge Accounting Improvements. In November 2025, the FASB issued ASU 2025-09, which is to better portray the economic results of an entity's risk management activities in its financial statements and to make certain targeted improvements to simplify the application of the hedge accounting guidance. The standard is effective for public business entities for annual and interim periods beginning after December 15, 2026, with early adoption permitted, and applied prospectively. We are currently evaluating the impact of this standard.

ASU 2025-11 Interim Reporting (Topic 270) - Narrow-Scope Improvements. In December 2025, the FASB issued ASU 2025-11, which is to improve the navigability of the required interim disclosures and clarifying when the guidance is applicable. The standard is effective for public business entities for interim reporting periods within annual reporting periods beginning after December 15, 2028, with early adoption permitted, and applied either prospectively or retrospectively for all prior periods presented. We are currently evaluating the impact of this standard.

ASU 2025-12 Codification Improvements. In December 2025, the FASB issued ASU 2025-12, which is to facilitate Codification updates for a broad range of topics arising from technical corrections, unintended application of the Codification, clarifications, and other minor improvements. The standard is effective for all entities for annual and interim reporting periods beginning after December 15, 2026, with early adoption permitted, and applied either prospectively or retrospectively for all prior periods presented. We are currently evaluating the impact of this standard.

4. Business Combinations

OPCG Acquisition

On November 10, 2025, the Company executed an asset purchase agreement with OPCG, LLC ("OPCG"), a Missouri limited liability company, to acquire certain OPCG assets in exchange for $4.8 million in cash. This acquisition adds healthcare program management and consulting expertise to our existing services.

The Company accounted for this transaction as a business combination in accordance with the acquisition method of accounting. As a result, OPCG's identifiable assets were recorded at their fair market value as of the acquisition date. No liabilities were assumed as part of the acquisition. For income tax purposes, the acquisition of OPCG is treated as asset acquisition and the goodwill is tax deductible. The resulting intangible assets are amortizable for income tax purposes.

The following table summarizes the consideration transferred to acquire OPCG and the fair value of the assets acquired at the acquisition date (in thousands):

The goodwill resulting from the purchase price allocation is attributable to the workforce of the acquired business (which is not eligible for separate recognition as an identifiable intangible asset) and the expected synergies benefits of expanding the combined target markets.

BST Acquisition

On May 8, 2023, the Company acquired 100 percent of Benefits Science LLC ("Benefits Science Technologies" or "BST"), a Texas limited liability company offering next generation data and advanced analytics services for $160.1 million, net of acquired cash, consisting of $140.9 million in cash and $19.2 million in Company Class A common stock. This acquisition adds enhanced data and analytics capabilities to our existing services.

The BST acquisition was accounted for as a business combination using the acquisition method of accounting. As a result of the BST acquisition and the application of purchase accounting, BST's identifiable assets and liabilities were adjusted to their fair market value as of the acquisition date. For income tax purposes, the acquisition of BST is treated as the acquisition of partnership interests. The resulting intangible assets are amortizable for income tax purposes.

Following the consummation of the transactions, the Company entered into separately recognized transactions with key employees and service providers of BST who are employed or engaged by the Company, and are eligible to participate in a long-term incentive and retention program. Pursuant to this incentive and retention program, cash payments will be made to such participant if: (i) subject to limited exceptions, such participant remains employed or engaged by the Company through the date of payment; and (ii) certain threshold, target and maximum annual recurring revenue targets relating to the business of BST are met over three tofive years. At inception, the aggregate potential cash payments under this plan if the target annual recurring revenue targets were achieved was $66.0 million, with up to $16.5 million in additional potential cash payments if the maximum annual recurring revenue targets were achieved. However, as of December 31, 2025, taking into consideration the actual annual recurring revenue achieved to date and the number of participants remaining in the plan, the aggregate potential cash payments under this plan if the remaining target annual recurring revenue targets are achieved is $2.0 million, with up to $0.5 million in additional potential cash payments if the remaining maximum annual recurring revenue targets are achieved. Further, there is a catch-up opportunity of up to $2.0 million (taking into consideration the number of participants remaining in the plan) if a separate catch-up annual recurring revenue target is achieved. If a minimum threshold as a percentage of target annual recurring revenue is not achieved, no cash payments will be due. The Company will account for the incentive payments as post-combination compensation costs. Through December 31, 2025, the Company has not recorded any compensation costs related to this program, as the annual recurring revenue target have not been achieved.

The following table summarizes the consideration transferred to acquire BST and the amounts of identified assets acquired and liabilities assumed at the acquisition date (in thousands):

(1)Includes client relationships of $19.2 million with a remaining useful life of 20 years, technology of $15.5 million with a remaining useful life of 7 years, and non-compete agreements of $1.0 million with a remaining useful life of 5 years. The weighted average remaining useful life of the acquired intangibles subject to amortization is 14 years.

The results of operations and financial condition of BST have been included in the Company's consolidated financial statements from the date of acquisition.

In connection with the BST acquisition, the Company incurred transaction costs that have been expensed as incurred and these amounts totaling $6.9 million for the year ended December 31, 2023, are included in General and administrative expenses in the consolidated statements of operations and comprehensive loss.

5. Property and Equipment

Property and equipment, net consisted of the following (in thousands):

During the years ended December 31, 2025, 2024 and 2023, the Company recorded a loss of sale of assets of $9.4 million, $8.6 million and $0.9 million, respectively.

6. Leases

Substantially all of our operating leases are related to office space we lease in various buildings for our own use. The terms of these non-cancelable operating leases typically require us to pay rent and a share of operating expenses and real estate taxes. We also lease equipment under both operating and finance lease arrangements. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company determines if an arrangement is a lease at inception. Right-of-use ("ROU") assets represent the Company's right to control the use of the underlying assets for the lease term and lease liabilities represent the Company's obligations to make lease payments arising from the Company's portfolio of leases. Operating leases are included in Operating lease ROU assets and Current and Non-current operating lease obligation on the consolidated balance sheets. Finance lease ROU assets are included in Property and equipment, net, and the current and non-current portion of finance lease liabilities are included in Other accrued expenses and Long-term debt, respectively, on the consolidated balance sheets.

The Company has operating and finance leases for corporate offices and certain equipment. Leases have remaining lease terms ranging fromone tosix years. Certain leases include options to renew in increments offive years; the options to renew are not considered reasonably certain to be exercised at commencement and are not included in the lease term. Some leases have variable payments, however, because they are not based on an index or rate, they are not included in the measurement of ROU assets and operating lease liabilities. Variable payments for real estate leases relate primarily to common area maintenance, insurance and property taxes associated with the properties. These variable payments are expensed as incurred. The Company elected to not separate lease and non-lease components for building and equipment leases. The Company will account for the lease and non-lease components, such as those described above, as a single lease component. The Company elected not to apply the recognition requirements to leases with an initial term of twelve months or less ("short-term leases") and recognize lease expense for these short-term leases on a straight-line basis over the lease term.

The Company’s lease costs are recorded in Cost of services and General and administrative expenses. Short-term and finance lease expense was determined to not be material. The lease costs are as follows (in thousands):

Future lease payments under operating leases as of December 31, 2025 are as follows (in thousands):

Additional information related to the Company’s leases is as follows:

As of December 31, 2025 and 2024, there were no material lease transactions that we have entered into but have not yet commenced.

7. Goodwill and Other Intangible Assets

Other intangible assets consisted of the following (in thousands):

As of December 31, 2025, the aggregate future amortization expense is as follows (in thousands):

Goodwill was as follows (in thousands):

The Company identified one reporting unit for the purpose of goodwill impairment testing and performed a qualitative test for goodwill impairment of theone reporting unit during the fourth quarter. Based on the results of qualitative impairment assessment performed in the fourth quarter of 2025. The Company determined that it was more likely than not that the fair value of the reporting unit with goodwill was greater than their respective carrying values andno impairment loss related to goodwill was recorded during the year ended December 31, 2025.

During the year ended December 31, 2024, $1,425.9 million impairment loss related to goodwill and $8.5 million impairment loss related to indefinite-lived intangible assets, respectively, were recorded due to significant decline in our stock price and market capitalization and/or revised forecasts represented triggering events. During the third and fourth quarter of December 31, 2024, the Company committed to the Company-wide rebranding that culminated in the change of the Company’s corporate name to Claritev Corporation on February 17, 2025. As a result of this initiative, it was expected that certain of the Company’s brand names and related trademarks would cease to be used, resulting in impairment loss to intangible assets of $54.5 million that was included in Loss on impairment of goodwill and intangible assets in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2024.

For each quantitative impairment test of goodwill performed in the year ended December 31, 2024, we calculate the estimated enterprise fair value of the reporting unit using (i) a discounted cash flow analysis, (ii) forecasted EBITDA trading multiples for comparable publicly traded companies and (iii) historical EBITDA multiples for comparable acquisitions, giving equal weight to the three approaches. Assumptions used in the discounted cash flow analysis include forecasted revenues, forecasted expenses, the terminal growth rate and the discount rate. The fair value measurements are based on significant unobservable inputs and thus represent Level 3 inputs. If business conditions or expectations were to change materially, it may be necessary to record further impairment charges in the future.

No impairment loss related to goodwill or indefinite-lived intangible assets was recorded during the year ended December 31, 2023.

8. Derivative Financial Instruments

The Company is exposed to interest rate risk on its floating rate debt. On September 12, 2023, the Company entered into three interest rate swap agreements with a total notional value of $800 million to effectively convert a portion of its floating rate debt to a fixed-rate basis of 4.59% as a weighted-average across thethree swaps. The interest rate swap agreements are effective August 31, 2023 and mature on August 31, 2026. The principal objective of these contracts is to reduce the volatility of the cash flows in interest payments associated with the Company's floating rate debt, thus reducing the impact of interest rate changes on future interest payment cash flows. The Company's interest rate swaps are highly effective at offsetting the changes in cash outflows and therefore designated as cash flow hedging instruments.

The Company records derivatives on the consolidated balance sheets at fair value, as described in Note 10. Fair Value Measurements. The gain or loss on the derivative is recorded in accumulated other comprehensive loss and subsequently reclassified into interest expense in the same period(s) during which the hedged transaction affects earnings.

The following table represents the activity of cash flow hedges included in accumulated other comprehensive income (loss) on the consolidated balance sheets and in interest expense in the consolidated statements of operations and comprehensive loss for the periods presented (in thousands):

The following table represents the fair value of derivative assets and liabilities on the consolidated balance sheets (in thousands):

9. Long-Term Debt

Outstanding long-term debt is summarized below (in thousands):

(1)Interest on the First-Out First Lien Term Loans (as defined below) is calculated, at MPH Acquisition Holdings LLC's ("MPH") option, as (a) Term Secured Overnight Financing Rate ("Term SOFR") (or 0.50%, if higher) plus 3.75% or (b)(x) the highest rate of (1) the prime rate, (2) the federal funds effective rate plus 0.50%, (3) Term SOFR for an interest period of one month plus 1.00% and (4)1.50% plus (y)2.75%.

(2)Interest on the Second-Out First Lien Term Loans (as defined below) is calculated, at MPH's option, as (a) Term SOFR (or 0.50%, if higher) plus the applicable SOFR adjustment plus 4.60% or (b)(x) the highest rate of (1) the prime rate, (2) the federal funds effective rate plus 0.50%, (3) Term SOFR for an interest period of one month plus the applicable SOFR adjustment plus 1.00% and (4)1.50% plus (y)3.60%.

Debt issuance, redemption and modification

On January 30, 2025, the Company, MPH and certain other of the Company’s direct and indirect subsidiaries completed the Refinancing Transaction. As used herein, references to the "Refinancing Transaction" are to the below transactions, which were consummated on January 30, 2025:

•separate offers to exchange (i)5.50% Senior Notes due 2028 issued by MPH ("5.50% Notes") for a portion of (a) "first-out" first lien term loans maturing on December 31, 2030 under that certain Super Senior Credit Agreement, dated as of January 30, 2025 (as amended, restated, amended and restated, supplemented, or otherwise modified from time to time, the "First Lien Credit Agreement"), by and among MPH, as borrower, MPH Acquisition, the parent guarantors from time to time party thereto, the co-obligors from time to time party thereto, the lenders from time to time party thereto, and Goldman Sachs Lending Partners LLC, as administrative agent, collateral agent, swingline lender, and a letter of credit issuer (such loans, the "First-Out First Lien Term Loans"), (b) "second-out"6.50% cash &5.00% PIK first lien notes due 2030 issued by MPH (the "Second-Out First Lien A Notes") and (c) "second-out"5.75% first lien notes due 2030 issued by MPH (the "Second-Out First Lien B Notes" and, together with the Second-Out First Lien A Notes, the "Second-Out First Lien Notes"); (ii)5.750% Senior Notes due 2028 issued by MPH ("5.750% Notes") for a portion of (a) Second-Out First Lien A Notes, (b) Second-Out First Lien B Notes and (c) "third-out"6.00% cash &0.75% PIK first lien notes due 2031 issued by MPH (the "Third-Out First Lien A Notes"); (iii) the 6.00% /7.00% Convertible Senior PIK Toggle Notes due 2027 ("Senior Convertible PIK Notes") for a portion of (a) Second-Out First Lien A Notes, (b) Second-Out First Lien B Notes and (c) "third-out"6.00% cash &

0.75% PIK first lien notes due 2031 issued by Claritev (the "Third-Out First Lien B Notes" and, together with the Third-Out First Lien A Notes, the "Third-Out First Lien Notes"); and (iv) MPH’s prior term loans maturing on September 1, 2028 (such loans, the "Prior Term Loans") under that certain Credit Agreement, dated as of August 24, 2021 (as amended, restated, amended and restated, supplemented, or otherwise modified from time to time, the "Prior First Lien Credit Agreement"), by and among MPH, as borrower, MPH Acquisition, the co-obligors from time to time party thereto, the lenders from time to time party thereto, and Goldman Sachs Lending Partners LLC, as administrative agent, collateral agent, swingline lender and a letter of credit issuer for a portion of (a) First-Out First Lien Term Loans and (b) "second-out" first lien term loans maturing on December 31, 2030 under the First Lien Credit Agreement (the "Second-Out First Lien Term Loans") (collectively, the "Exchange Offers");

•(i) the termination of all revolving credit commitments under the Prior First Lien Credit Agreement (such commitments, the "Prior Revolving Credit Commitments") and (ii) the establishment of $350.0 million in "first-out" first lien revolving credit commitments terminating on December 31, 2029 under the First Lien Credit Agreement (such commitments, the "Revolving Commitments");

•the related consent solicitations (the "Consent Solicitations") to (i) holders of the 5.50% Notes, the 5.750% Notes and the Senior Convertible PIK Notes to remove substantially all of the covenants, certain events of default and certain other provisions contained in the indentures governing the 5.50% Notes, the 5.750% Notes and the Senior Convertible PIK Notes, and to release all of the collateral securing the 5.50% Notes and (ii) to holders of Prior Term Loans and Prior Revolving Credit Commitments to eliminate substantially all covenants, certain default provisions, and substantially all representations and warranties in the Prior First Lien Credit Agreement, as well as release certain of the collateral and guarantors thereunder, which had the effect of releasing (i) the same guarantors under the indentures governing the 5.50% Notes and the 5.750% Notes and (ii) the same collateral securing the 5.50% Notes; and

•the amendment to the Prior First Lien Credit Agreement (the "Credit Agreement Amendment") to (i) explicitly permit the Refinancing Transaction, (ii) eliminate substantially all affirmative covenants, negative covenants, representations and warranties and events of default set forth in the Prior First Lien Credit Agreement and (iii) release the Released Guarantors from their guarantee obligations and release any and all security interests or liens on the assets of such Released Guarantors.

As used herein, references to "Released Guarantors" are to (i) Benefits Science LLC, (ii) BST Acquisition Corp., (iii) American Lifecare Holdings, Inc., (iv) American Lifecare, Inc., (v) Statewide Independent PPO Inc., (vi) Private Healthcare Systems, Inc., (vii) HST, (viii) HST Acquisition Corp., (ix) Launchpoint Ventures, LLC, (x) DHP Acquisition Corp. and (xi) Data & Decision Science LLC.

Interest on the revolving loans (borrowed pursuant to MPH's $350.0 million senior secured revolving credit facility maturing on December 31, 2029 under the First Lien Credit Agreement (the "2025 Revolving Credit Facility")) is calculated, at MPH’s option, as (a) Term SOFR (or 0.00%, if higher) plus 3.75% or (b) (x) the highest rate of (1) the prime rate, (2) the federal funds effective rate plus 0.50%, (3) Term SOFR for an interest period of one month plus 1.00% and (4)1.00% plus (y)2.75%. We are obligated to pay a commitment fee on the average daily unused amount of our 2025 Revolving Credit Facility. The fee can range from an annual rate of 0.25% to 0.50% based on our consolidated first-out first lien debt to consolidated EBITDA ratio, as defined in the First Lien Credit Agreement.

As part of the Refinancing Transaction, we have incurred transaction expenses of $72.0 million, of which $8.0 million and $63.9 million have been expensed as incurred for years ended December 31, 2025 and 2024, respectively, and are included in Transaction costs related to refinancing transaction in the consolidated statements of operations and comprehensive loss. Debt issuance costs of $6.4 million associated with the 2025 Revolving Credit Facility are included in other assets on the consolidated balance sheets as of December 31, 2025. As of December 31, 2025, we have drawn $20.0 million under the 2025 Revolving Credit Facility loan and we have $6.4 million of outstanding letters of credit under such facility. Accordingly, we have access to an additional $323.6 million available for borrowing under the 2025 Revolving Credit Facility.

The Exchange Offers were treated as debt modifications, and all unamortized debt issue costs and discounts associated with the prior notes were ratably applied to the new notes issued, and will be amortized over the new term.

The Refinancing Transactions increased the Company’s taxable income for 2025 and the estimated income tax liability resulting from the transaction was between $50.0 million and $60.0 million.

During the year ended December 31, 2024, the Company repurchased and cancelled $21.1 million of the Senior Convertible PIK Notes. The repurchases resulted in the recognition of gain on debt extinguishment of $5.9 million for the year ended December 31, 2024, which are included in Loss (gain) on extinguishment of debt in the

consolidated statements of operations and comprehensive loss.

During the year ended December 31, 2023, the Company repurchased and cancelled $184.0 million and $25.0 million, of the 5.750% Notes and Senior Convertible PIK Notes, respectively. The repurchase resulted in the recognition of gain on debt extinguishment of $46.9 million and $7.1 million for the year ended December 31, 2023, for the 5.75% Notes and the Senior Convertible PIK Notes, respectively, which are included in Loss (gain) on extinguishment of debt in the consolidated statements of operations and comprehensive loss.

Debt Discounts

Some of our debt instruments have been issued with a discount. These discounts were capitalized and are being amortized over the term of the related debt using the effective interest method.

The following table is a summary of the cost and accumulated amortization of debt discounts (in thousands):

(1) The Exchange Offers were treated as debt modifications, and all unamortized debt discounts associated with the prior notes were ratably applied to the new notes issued and will be amortized over the new term.

Debt Issuance Costs

In connection with the issuance of our debt instruments, the Company incurred specific expenses related to raising the debt, including commissions, fees and expenses of investment bankers and underwriters, registration and listing fees, accounting and legal fees pertaining to the financing and other external, incremental expenses paid to advisors that were directly attributable to realizing the proceeds of the debt issues. These costs were capitalized and are being amortized over the term of the related debt using the effective interest method.

The following table is a summary of the cost and accumulated amortization of debt issuances costs (in thousands):

(1)The Exchange Offers were treated as debt modifications, and all unamortized debt issuance costs associated with the prior notes were ratably applied to the new notes issued and will be amortized over the new term.

(2)The debt issuance costs associated with the revolving credit facility are included in other assets on the consolidated balance sheets.

Interest expense

The commitment fee and interest expense related to the 2025 Revolving Credit Facility and the revolving credit facility related to the Term Loan B (the "Revolver B") were $8.2 million for the year ended December 31, 2025. The commitment fee and interest expense related to Revolver B were $3.1 million and $2.8 million for the years ended December 31, 2024 and 2023, respectively. These amounts are included in interest expense in the consolidated statements of operations and comprehensive loss.

Interest expense related to long-term debt was $383.8 million, $323.3 million and $330.4 million for the years ended December 31, 2025, 2024 and 2023, respectively. These amounts are included in the consolidated statements of operations and comprehensive loss. PIK interest accrual and accretion of debt repayment premium were $39.7 million and $17.9 million, respectively, for the year ended December 31, 2025, which were included in interest expense. Accrued PIK interest increases the principal amount of Second-Out First Lien A Notes, Third-Out First Lien A Notes and Third-Out First Lien B Notes on a semi-annual basis. Accretion of debt repayment premium, which is not subject to PIK interest calculation, increases the principal amount of Third-Out First Lien A Notes and Third-Out First Lien B Notes due to 107% principal payment requirement at maturity. PIK interest and the accretion of debt repayment premium are non-cash interest. No PIK interest nor accretion of debt repayment premium were incurred for the years ended December 31, 2024 and 2023.

Future principal payments

As of December 31, 2025, the aggregate future principal payments for long-term debt, excluding non-current finance lease liabilities (based on the outstanding long-term debt as of December 31, 2025 and assuming the payment are made at their respective anticipated payment dates) were as follows (in thousands):

Guarantees

All obligations under the debt agreements governing the 2025 Revolving Credit Facility, the First Lien Term Loans, and the New Notes issued by MPH are unconditionally guaranteed by the Company, MPH Acquisition, Polaris Intermediate, Polaris Parent LLC ("Polaris Parent"), and each existing and subsequently acquired or organized direct or indirect wholly owned U.S. organized subsidiary of MPH (subject to certain exceptions). All obligations under the New Notes issued by Claritev are unconditionally guaranteed by MPH, MPH Acquisition Corp. 1 ("MPH Acquisition"), Polaris Intermediate, Polaris Parent, and each existing and subsequently acquired or organized direct or indirect wholly owned U.S. organized subsidiary of MPH (subject to certain exceptions). All such obligations, and the guarantees of such obligations, are secured, subject to permitted liens and other exceptions, by a first priority lien shared between the senior secured credit facilities and the New Notes on substantially all of the tangible and intangible property of the Company, MPH Acquisition, Polaris Intermediate, Polaris Parent, MPH and the subsidiary guarantors, and a pledge of all of the capital stock of each of their respective subsidiaries (subject to certain exceptions).The senior secured credit facilities and their guarantees are secured, subject to permitted liens and other exceptions, by a first priority lien on substantially all of MPH's and the subsidiary guarantors' tangible and intangible property, and a pledge of all of the capital stock of each of their respective subsidiaries.

The 5.50% Notes are guaranteed on a senior unsecured basis jointly and severally by the Company and its subsidiaries (subject to certain exceptions); provided that, as of January 30, 2025, the Released Guarantors are excluded from such guarantee.

The 5.750% Notes are guaranteed on a senior unsecured basis jointly and severally by the Company and its subsidiaries (subject to certain exceptions); provided that, as of January 30, 2025, the Released Guarantors are excluded from such guarantee.

The Senior Convertible PIK Notes are fully and unconditionally guaranteed by Polaris Intermediate.

Debt Covenants and Events of Default

The Company is subject to certain affirmative and negative debt covenants under the debt agreements governing our indebtedness that limit our and/or certain of our subsidiaries' ability to engage in specific types of transactions such as the ability to, among other things:

•incur additional indebtedness or issue disqualified or preferred stock;

•pay certain dividends or make certain distributions on capital stock or repurchase or redeem capital stock;

•make certain loans, investments or other restricted payments;

•transfer or sell certain assets;

•incur certain liens;

•place restrictions on the ability of its subsidiaries to pay dividends or make other payments to us;

•guarantee indebtedness or incur other contingent obligations;

•prepay junior debt and make certain investments;

•consummate any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), or dispose of all or substantially all of its business units, assets or other properties; and

•engage in transactions with our affiliates.

The 5.50% Notes,5.750% Notes, First-Out First Lien Term Loans, Second-Out First Lien Term Loans, and the New Notes have speculative grade ratings. The Term Loan B and Senior Convertible PIK Notes are unrated.

The financial covenant under the 2025 Revolving Credit Facility is such that, if, as of the last day of any fiscal quarter of MPH (commencing with the fiscal quarter ended March 31, 2025), the aggregate amount of loans under the 2025 Revolving Credit Facility, letters of credit issued under the 2025 Revolving Credit Facility (to the extent not cash collateralized or backstopped or, in the aggregate, in excess of $15.0 million) and swingline loans are outstanding and/or issued in an aggregate amount greater than 40.0% of the total commitments in respect of the 2025 Revolving Credit Facility at such time, the 2025 Revolving Credit Facility will require MPH to maintain a consolidated first-out, first lien debt-to-consolidated EBITDA ratio not to exceed 2.50 to 1.00. As of December 31, 2025, we did not exceed the financial covenant threshold under the 2025 Revolving Credit Facility to warrant additional compliance testing.

As of December 31, 2025, 2024 and 2023, we were in compliance with all of the debt covenants.

The debt agreements governing our senior secured indebtedness contain customary events of default, subject to grace periods and exceptions, which include, among other events, payment defaults, cross-defaults to certain material indebtedness, certain events of bankruptcy, material judgments, failure of a guarantee on the liens on material collateral to remain in effect, and, in the case of the debt agreements governing the senior secured credit facilities, and any change of control. Upon the occurrence of an event of default under such debt agreements, the lenders and holders of such debt will be permitted to accelerate the repayment of the loans and terminate the commitments, as applicable, thereunder and exercise other specified remedies available to the lenders and holders thereunder.

As a result of the Refinancing Transaction, (i) the Company and MPH entered into the amendment to the Existing First Lien Credit Agreement (the "Credit Agreement Amendment") and supplemental indentures with respect to the 5.50% Notes, the 5.750% Notes and the Senior Convertible PIK Notes, which had the effect of eliminating substantially all of the covenants and events of defaults in the Existing First Lien Credit Agreement and in the indentures governing such notes.

10. Fair Value Measurements

ASC 820, Fair Value Measurements states that fair value is an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. The following three-tier fair value hierarchy has been used in determining the inputs used in measuring fair value:

•Level 1 — Unadjusted quoted prices in active markets. These are generally obtained from real-time quotes for transactions in active exchange markets involving identical assets or liabilities on the reporting date.

•Level 2 — Quoted prices for similar assets and liabilities in active markets. These are typically quoted prices for identical or similar instruments in markets that are not active, and model-derived valuation in which all significant inputs are observable in active markets.

•Level 3 — Unobservable inputs in which there is little or no market data, that are significant to fair value of the assets or liabilities, which require the entity to develop its own assumptions.

Financial instruments

The carrying value of cash and cash equivalents, trade accounts receivables, net, prepaid expenses, prepaid taxes, unbilled Independent Dispute Resolutions fee, net, other current assets, net, accounts payable, accrued interest, accrued compensation, and other accrued expenses, approximate their fair value due to their relative short maturities.

The financial instrument that could potentially subject the Company to concentration of credit risk consists primarily trade accounts receivable.

Cash and cash equivalents as of December 31, 2025 and 2024 did not include money market funds.

The Company's carrying amount and fair value of long-term debt consisted of the following (in thousands):

We estimate the fair value of long-term debt using level 2 inputs as they are not registered securities nor listed on any securities exchange but may be traded by qualified institutional buyers.

Recurring fair value measurements

The Company records interest rate swaps on the consolidated balance sheets at fair value, which represents the estimated amounts it would receive or pay upon termination of the derivative prior to the scheduled expiration date. The fair value is derived from model-driven information based on observable Level 2 inputs, such as SOFR forward rates.

The Company records cRSUs under Accrued Compensation on the consolidated balance sheets at fair value, which represents the estimated amount it would pay upon vesting of the cRSUs prior to the vesting date. The fair value is derived from the Black-Scholes model based on observable Level 2 inputs. The fair value of cRSUs granted was$19.9 millionas of December 31, 2025, of which $8.3 million was recognized for the year ended December 31, 2025. See Note 12. Stock-Based Compensation for additional information.

Non-recurring fair value measurements

Our non-marketable equity securities using the measurement alternative are adjusted to fair value on a non-recurring basis. Adjustments are made when observable transactions for identical or similar investments of the same issuer occur, or due to impairment. These securities are classified as Level 2 in the fair value hierarchy because we estimate the value based on valuation methods using the observable transaction price at the transaction date.

During the year ended December 31, 2025, we sold these alternative investments which resulted in a loss of$2.7 million recorded to Loss on sale of equity investments in the consolidated statements of operations and comprehensive loss. The carrying amount of these alternative investments, recorded under Other assets, net on the consolidated balance sheets, waszero and $15.0 million as of December 31, 2025 and December 31, 2024, respectively.

We also measure certain non-financial assets at fair value on a nonrecurring basis, primarily goodwill and long-lived tangible and intangible assets, in connection with periodic evaluations for potential impairment. We estimate the fair value of these assets using primarily unobservable inputs and, as such, these are considered Level 3 fair value measurements. There were impairment charges for these assets of $1,488.9 million for the year ended December 31, 2024.

For additional information related to goodwill, intangible assets, long-lived assets and impairments, see Note 2. Summary of Significant Accounting Policies and Note 7. Goodwill and Other Intangible Assets.

11. Shareholders' (Deficit)/Equity

Preferred Stock

The Company is authorized to issue 10,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company's board of directors. As of December 31, 2025 and 2024, there wereno shares of preferred stock issued or outstanding.

Class A Common Stock

The Company is authorized to issue 1,500,000,000 shares of Class A common stock with a par value of $0.0001 per share. As of December 31, 2025, there were 17,295,582 shares of Class A common stock issued, excluding (i)2,178,504 shares of Class A common stock available for future grants under our 2020 Omnibus Incentive Plan, and (ii) the 808 shares of Class A common stock issuable upon conversion of the Senior Convertible PIK Notes.

Except as otherwise required by law or as otherwise provided in any certificate of designation for any series of preferred stock, the holders of Class A common stock will possess all voting power for the election of directors and all other matters requiring shareholder action and will be entitled toone vote per share on matters to be voted on by shareholders. The holders of our Class A common stock will at all times vote together as one class on all matters submitted to a vote of the Class A common stock.

Warrants

Warrants were issued to the Sponsor (the "Private Placement Warrants") in a private placement simultaneously with the closing of the initial public offering by Churchill Sponsor III, LLC ("Churchill") which closed on February 19, 2020, which include the warrants to purchase Churchill's Class A common stock ("Working Capital Warrants") issued pursuant to the terms of an unsecured promissory note issued by the Company to the Sponsor, and which are on terms identical to the terms of the Private Placement Warrants. In connection with the execution of the Merger Agreement, Churchill and Michael Klein, Jay Taragin, Jeremy Paul Abson, Glenn R. August, Mark Klein, Malcolm S. McDermid, and Karen G. Mills entered into a Sponsor Agreement (as amended, the "Sponsor Agreement"). Pursuant to the terms of the Sponsor Agreement,310,102 of the founder shares ("Unvested Founder Shares") and 120,000 Private Placement Warrants were unvested as of October 8, 2020 and would only re-vest if the closing price of our Class A common stock exceeds $500.00 per share for any forty (40) trading days in a consecutive sixty (60) day period between October 8, 2021 and October 8, 2025. Any such Unvested Founder Shares, Private Placement Warrants and Working Capital Warrants that did not re-vest on or before October 8, 2025 would be forfeited and cancelled.

Accordingly, on October 8, 2025, the Private Placement Warrants and the Working Capital Warrants, to purchase Sponsor's Class A common stock, and Unvested Founder Shares were forfeited and cancelled.

Additional paid-in capital

Additional paid-in capital is reported in the shareholders' (deficit)/equity section of the consolidated balance sheets and corresponds to the cash that shareholders have given the Company in exchange for stock.

Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss is reported in the shareholders' (deficit)/equity section of the consolidated balance

sheets and corresponds to the changes in the fair value of interest rate swap agreements designated as cash flow hedges.

Treasury stock

On February 27, 2023, the Company's Board of Directors approved a share repurchase program authorizing the Company to repurchase up to $100 million of its Class A common stock from time to time in open market transactions. The repurchase program was effective immediately and set to expire on December 31, 2023, which was subsequently extended to December 31, 2024. Total share repurchased amount was$25.6 million under the share repurchase program by the expiration date of December 31, 2024.

On December 18, 2025, the Company’s Board of Directors approved afive-year share repurchase program (the "Five-Year Program") authorizing the Company to purchase up to $75.0 million of its Class A common stock from time to time in open market transactions, subject to compliance with applicable legal requirements. The Five-Year Program was approved starting January 1, 2026 through December 31, 2030 and is subject to a $20.0 million cap per calendar year. As of the date of this filing, the Company has not made any repurchases pursuant to the Five-Year Program.

As of December 31, 2025 and 2024, there were 742,859 and 742,859 shares of Class A common stock held in treasury, respectively.

Non-controlling Interests

During the year ended December 31, 2025, the Company formed inCortex LLC, a Delaware limited liability company as a wholly owned subsidiary of the company. On December 29, 2025, The Company exchanged certain membership interests of inCortex LLC to iOCortex LLC, a Delaware limited liability company, which is a wholly-owned subsidiary of iOHealth - FZE, a limited liability company existing under the laws of the United Arab Emirates, in exchange for the intellectual property rights associated with certain cloud-based software assets. The Company accounts for the membership interests held by iOCortex LLC as non-controlling interests on the consolidated balance sheets. During the year ended December 31, 2025, no net income or loss was attributable to the noncontrolling interests.

12. Stock-Based Compensation

The Company operates under the 2020 Omnibus Incentive Plan. The purpose of the 2020 Omnibus Incentive Plan is to provide a means through which the Company may attract and retain key personnel whereby directors, officers, employees, consultants and advisors of the Company and its subsidiaries can acquire and maintain an equity interest in the Company, or be paid incentive compensation, including incentive compensation measured by reference to the value of Class A Common Stock, thereby strengthening their commitment to the welfare of the Company and aligning their interests with those of the Company's shareholders.

There are 5,396,250 total shares authorized under the plan and as of December 31, 2025 there are 2,178,504 shares of Class A common stock available for the issuance of awards under the 2020 Omnibus Incentive Plan and 357,915 shares available for issuance under our ESPP. The Company's CEO, with the approval of the Compensation Committee of the Board, determines participation and the allocation of the awards. Awards under the 2020 Omnibus Incentive Plan typically vest from 6 months to 4 years and are generally subject to either cliff vesting or graded vesting. Awards do not have non-forfeitable rights to dividends or dividend equivalents.

The Company has adopted an Incentive Compensation Clawback Policy in order to help ensure that incentive compensation is paid or awarded based on accurate financial results and the correct calculation of performance against incentive targets.

The Company has allocated stock-based compensation expenses under the 2020 Omnibus Incentive Plan and ESPP between Costs of services and General and administrative expenses in the consolidated statements of operations and comprehensive loss as follows (in thousands):

There was $49.0 million of unrecognized compensation cost as of December 31, 2025 related to the outstanding awards which is expected to be recognized over a weighted average period of 20 months.

Non-qualified stock options

Non-qualified stock option activity is summarized below (in thousands, except price and years):

Restricted Stock and Restricted Stock Units

Restricted Stock Units activity is summarized below (in thousands, except per share data):

On March 1,2025, the Company granted a new type of award via the 2020 Omnibus Incentive Plan, in the form of cRSUs. The Company granted 565.6 thousand shares with a fair value at grant date of$8.2 million. The cRSUs vest in two tranches, one-half on each of the first and second anniversaries of the date of the grant. Each tranche of cRSUs is entitled to receive a cash payment equivalent to the fair market value of Class A common stock on the vesting date, subject to a cap of 4.0 x the fair market value of Class A common stock on the grant date.

The fair value assigned to cRSUs is determined using the market price of the Company’s stock on the reporting date minus a call option valued using the Black-Scholes model. Expected volatility in the model was estimated based on the volatility of historical stock prices over a period matching the expected term of the award or one-year period if the expected term of the award is less than a year. The risk-free interest rate is based on U.S. Treasury yield constant maturities for a term matching the expected term of the award. The following table summarizes the key assumption used to determine the fair value of the cRSUs:

The Company classifies the cRSUs as a liability included in Accrued compensation on the consolidated balance sheets as the vesting results in payment of cash by the Company. The cRSUs are adjusted to fair value at each reporting date.

ESPP

Our ESPP allows eligible employees to contribute a portion of their base earnings toward the quarterly purchase of our Class A common stock. The purchase price is 85% of the fair market value of the stock on the last business day of the offering period. The number of shares issued under our ESPP were as follows:

13. Basic and Dilutive Weighted Average Shares Outstanding

We have excluded from the calculation of diluted weighted average shares outstanding those instruments whose effect would have been antidilutive. The following table presents the weighted average number of shares outstanding and the computation of basic and diluted weighted average shares outstanding retroactively adjusted to reflect the reverse stock split for the periods presented:

14. Income Taxes

The Company does not have significant operations in foreign jurisdictions. The benefit for income taxes are as follows (in thousands):

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law which included changes to certain tax laws. The tax law allows for the immediate expensing of capitalized software development costs, including provisions that impact prior treatment of these costs, as well as other positions favorable to the Company. Excluding interactions with other

IRC regulations, these provisions favorably impacted deferred tax assets by approximately $80.5 million as of December 31, 2025.

Many of the tax provisions of the OBBBA are designed to accelerate tax deductions, which could lead to lower cash tax payments. The new tax law did not materially impact income tax expense or our effective tax rate during the year ended December 31, 2025. We will continue to monitor the impact of the OBBBA and the range of potential outcomes, which will depend on our facts in each year and anticipated future guidance from the U.S. Department of the Treasury.

The TCJA and the Coronavirus Aid, Relief and Economic Security Act continue to be applicable to the Company’s provision for income taxes for the years ended December 31, 2025, 2024 and 2023. Income tax effects resulting from changes in tax laws are accounted for by the Company in accordance with the authoritative guidance, which requires that these tax effects be recognized in the period in which the law is enacted.

The pre-tax loss during the years ended December 31, 2025, 2024 and 2023 of $373.1 million, $1,770.7 million and $107.1 million, respectively, generated an income tax benefit of $88.8 million, $124.9 million and $15.4 million, respectively. The Company also recorded a cumulative deferred provision in Other comprehensive income (loss) of $1.3 million, $2.1 million and $3.7 million, respectively.

The reconciliation of the tax provision at the U.S. federal statutory rate of 21% to the provision for income taxes and the effective tax rate after the adoption of ASU 2023-09 is as follows (in thousands):

( a)States: NY, CA, IL, MA, MN, NJ make up greater than 50%.

The reconciliation of the tax provision at the U.S. federal statutory rate of 21% to the provision for income taxes and the effective tax rate for years prior to the adoption of ASU 2023-09 is as follows (in thousands):

The effective tax rate for the year ended December 31, 2025 differed from the statutory rate primarily due to non-deductible stock-based compensation expense, limitations on executive compensation, tax credits and state tax benefit.

The effective tax rate for the year ended December 31, 2024 differed from the statutory rate primarily due to non-deductible stock-based compensation expense, limitations on executive compensation, non-deductible goodwill impairment, tax credits and state tax benefit.

The effective tax rate for the year ended December 31, 2023 differed from the statutory rate primarily due to non-deductible stock-based compensation expense, non-deductible mark-to-market liability, limitations on executive compensation, non-deductible transaction costs, changes in the Company’s deferred state tax rate due to the BST acquisition, tax credits and state tax benefit.

The Company incurred an impairment charge of $1,469.0 million in the year ended December 31, 2024 which was treated for income tax purposes in accordance with ASU 2017-04. Of this impairment charge, $1,344.0 million resulted in an income tax expense of $282.3 million, since it is permanently non-deductible for income tax purposes.

The following are significant deferred income tax assets and liabilities (in thousands):

The Company hasno remaining NOL carry forwards for federal income tax purposes as of December 31, 2025 and 2024. The Company has net operating loss carryforwards for state income tax purposes of $0.3 million as of both December 31, 2025 and 2024. The Company has disallowed interest carry forwards for federal income tax purposes of $835.4 million and $200.7 million tax effected as of December 31, 2025, $663.2 million, $159.3 million tax effected as of December 31, 2024, that will be available to reduce future taxable income, subject to certain income limitations and which have an indefinite carryforward period. The Company believes it is more likely than not that these interest carryforwards will be fully utilized considering the weight of all positive and negative evidence under current tax laws.

During 2025, the Company incurred a capital loss on its sale of an equity investment. The resulting capital loss was recorded as a deferred tax asset. The Company also recorded a corresponding valuation allowance since it concluded it is more-likely-than-not that the Company will not generate capital gains to offset the capital loss.

During 2020, the Company marked-to-market certain investments which would result in a capital loss deferred tax asset for which the Company recorded a corresponding valuation allowance. As of December 31, 2025, the Company kept the valuation allowance related to the remaining estimated capital losses in excess of capital gain based on the difference between the tax and book balance of these investments. It is more likely than not the Company will not generate capital gain income to offset these losses.

The Company does not have reserves for uncertain tax positions. Any need for a reserve or changes in a reserve would be a component of the Company's tax provision. The Company includes interest and tax penalties as part of the tax provision. The Company does not reasonably expect any other significant changes in the next twelve months.

Various regulatory tax authorities periodically examine the Company's and its subsidiaries' tax returns. Tax years December 2022 through 2025 are open for Federal examination. Tax years 2021 through 2025 are still open for examination related to income taxes to various state taxing authorities.

The amount of cash federal income taxes paid and cash state income taxes paid, net of refunds by the Company during the year ended December 31, 2025 were $36.7 million and $7.8 million, respectively.

The amount of cash income taxes paid, net of refunds by the Company during the years ended December 31, 2024 and 2023 was $80.1 million and $100.1 million, respectively.

15. Commitments and Contingencies

Commitments

The Company has certain irrevocable letters of credit used to satisfy real estate lease agreements forfour of our offices in lieu of security deposits in the amount of $4.4 million as of December 31, 2025. The Company also has an irrevocable letter of credit to satisfy the obligations of a captive insurance subsidiary in the amount of $2.0 million outstanding as of December 31, 2025.

Unconditional Obligations

We have entered into cloud computing arrangements that are enforceable, legally binding and specify terms, including: fixed or minimum purchase obligations and the approximate timing of the payment. Certain routine arrangements that are entered into in the ordinary course of business are not included in the amounts below, as they are generally entered into in order to secure pricing or other negotiated terms and are difficult to quantify in a meaningful way or are for terms of less than one year.

As of December 31, 2025 our unconditional purchase obligations are as follows (in thousands):

Claims and Litigation

We are a defendant in various lawsuits and other pending and threatened litigation and other adversarial matters which have arisen in the ordinary course of business as well as regulatory investigations, all which have arisen in the ordinary course of business. While the ultimate outcome with respect to such proceedings cannot be predicted with certainty, we do not currently believe they will have a material adverse effect on our financial condition or results of operations.

We have been named in numerous federal lawsuits, including putative class action lawsuits relating to litigation on the basis of alleged violation of antitrust laws, asserting that, among other things, the Company is conspiring with commercial health insurance payers to suppress out-of-network reimbursements in violation of applicable antitrust law. These lawsuits were initially filed in various venues, including the Southern District of New York, the Northern District of Illinois, and the Northern District of California, naming the Company and, in certain cases, certain payers, as defendants. The lawsuits have now been centralized in the Northern District of Illinois pursuant to a transfer order issued by the federal Judicial Panel on Multidistrict Litigation and assigned to the Honorable Matthew F. Kennelly. Consolidated complaints were filed on November 18, 2024 and the defendants filed joint motions to dismiss the consolidated complaints on January 16, 2025, which were granted in part and denied in part on June 3, 2025. Discovery in the case is ongoing. We believe these lawsuits are without merit and are vigorously defending the Company.

We accrue for costs associated with certain contingencies, including, but not limited to, settlement of legal proceedings, regulatory compliance matters and self-insurance exposures when such costs are probable and reasonably estimable. Such accruals are included in other accrued expenses on the consolidated balance sheets. In addition, we accrue for legal fees incurred in defense of asserted litigation and regulatory matters as such legal fees are incurred. To the extent it is probable under our existing insurance coverage that we are able to recover losses and legal fees related to contingencies, we record such recoveries concurrently with the accrual of the related loss or legal fees. Significant management judgment is required to estimate the amounts of such contingent liabilities and the related insurance recoveries. In our determination of the probability and ability to estimate contingent liabilities and related insurance recoveries we consider the following: litigation exposure based on currently available information, consultations with external legal counsel, adequacy and applicability of existing insurance coverage and other pertinent facts and circumstances regarding the contingency. Liabilities established to provide for contingencies are adjusted as further information develops, circumstances change, or contingencies are resolved; and such changes are recorded in the consolidated statements of operations and comprehensive loss during the period of the change and appropriately reflected in other accrued expenses on the consolidated balance sheets.

16. Segment Information

ASC 280, Segment Reporting, establishes standards for reporting information about operating segments. Operating segments are defined as components of an entity for which separate financial information is available and regularly reviewed by the chief operating decision maker. The Company’s chief operating decision maker ("CODM") is the Chief Executive Officer. The Company manages its operations as a single segment for the purposes of assessing performance and making decisions. The Company's singular focus is being a leading value-added provider of data analytics and technology-enabled end-to-end cost management, payment and revenue integrity solutions to the healthcare industry.

The CODM assesses performance for our reporting segment and decides how to allocate resources based on consolidated net income (loss). The measure of segment assets is reported on the consolidated balance sheets as total consolidated assets. The CODM uses net income (loss) to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into our segment or into other parts of the entity, such as for acquisitions or debt and equity repurchases. Additionally, we have identified personnel expenses, stock-based compensation ("SBC"), and access and bill review fees as significant expenses that are regularly provided to the CODM and included in net income (loss). Personnel expenses are defined as salaries and corresponding benefits (excluding SBC), severance costs, indirect costs such as recruitment fees, contract labor, and are presented net of capitalized costs. Stock-based compensation includes expense under the 2020 Omnibus Incentive Plan and ESPP. Access and bill review fees include fees for accessing non-owned third-party provider networks, expenses associated with vendor fees for database access and systems technology used to reprice claims, and outsourced services. Third-party network expenses are fees paid to non-owned provider networks used to supplement our owned network assets to provide more network claim savings to our clients.

In addition, substantially all of the Company's revenues and long-lived assets are attributable to operations in the United States for all periods presented.

The following table presents summary results for our reporting segment for the periods presented (in thousands):