Starling Oncology, Inc.

Previous wording

The following discussion and analysis provides information that management believes is relevant to an assessment and understanding of the consolidated results of operations and financial condition of The Oncology Institute, Inc. ("TOI") along with its consolidating subsidiaries (the "Company"). The discussion should be read together with the unaudited condensed consolidated financial statements and the related notes that are included elsewhere in this Report. The information in this discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Such statements are based upon current expectations, as well as management's beliefs and assumptions and involve a high degree of risk and uncertainty. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Statements that include the words "believes," "anticipates," "plans," "expects." "intends," and similar expressions that convey uncertainty of future events or outcomes are forward-looking statements. Our actual results could differ materially from those discussed or suggested in the forward-looking statements herein. Factors that could cause or contribute to such differences include those described under the heading "Risk Factors" (Item 1A) in our Annual Report on Form 10-K for the year ended December 31, 2025, which was filed on March 12, 2026. In addition, as a result of these and other factors, our past financial performance should not be relied on as an indication of future performance. All forward-looking statements in this document are based on information available to us as of the filing date of this Quarterly Report on Form 10-Q and we assume no obligation to update any forward-looking statements or the reasons why our actual results may differ. All dollar values are expressed in thousands, unless otherwise noted.

Current wording

The following discussion and analysis provides information that management believes is relevant to an assessment and understanding of the consolidated results of operations and financial condition of Starling Oncology, Inc. ("STLN") along with its consolidating subsidiaries (the "Company"). The discussion should be read together with the unaudited condensed consolidated financial statements and the related notes that are included elsewhere in this Quarterly Report on Form 10-Q. The information in this discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Such statements are based upon current expectations, as well as management's beliefs and assumptions and involve a high degree of risk and uncertainty. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Statements that include the words "believes," "anticipates," "plans," "expects." "intends," and similar expressions that convey uncertainty of future events or outcomes are forward-looking statements. Our actual results could differ materially from those discussed or suggested in the forward-looking statements herein. Factors that could cause or contribute to such differences include those described under the heading "Risk Factors" (Item 1A) in our Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the Securities and Exchange Commission on March 12, 2026. In addition, as a result of these and other factors, our past financial performance should not be relied on as an indication of future performance. All forward-looking statements in this document are based on information available to us as of the filing date of this Quarterly Report on Form 10-Q and we assume no obligation to update any forward-looking statements, except as required by law.

Previous wording

Unless the context dictates otherwise, references in this Report on Form 10-Q to the “Company,” “we,” “us,” “our,” and similar words are references to The Oncology Institute, Inc., a Delaware corporation (“TOI”), and its consolidated subsidiaries and affiliated entities, as appropriate, including its consolidated variable interest entities (“VIEs”).

Current wording

Unless the context dictates otherwise, references in this Report on Form 10-Q to the “Company,” “we,” “us,” “our,” and similar words are references to Starling Oncology, Inc., a Delaware corporation (“STLN”), and its consolidated subsidiaries and affiliated entities, as appropriate, including its consolidated variable interest entities (“VIEs”). All dollar values are expressed in thousands, unless otherwise noted.

Previous wording

The Company is a leading value-based oncology company that manages community-based oncology practices for the Company and for independent oncology practices that together serve patients across 17 markets andfive states throughout the United States. As of March 31, 2026, we operate 65 community-based oncology practices, staffed with 116 oncologists and advanced practice providers employed by our affiliated physician-owned professional corporations, referred to as the "TOI PCs." In addition to our TOI-affiliated providers, we also manage a network of 275 providers in Florida under the Florida Oncology Network brand and 11 network providers in California. Collectively across the provider base, we manage a population of approximately 2.0 million patients under value-based agreements as of March 31, 2026. The Company's mission is to heal and empower cancer patients through compassion, innovation, and state-of-the-art medical care..

Current wording

The Company is a leading value-based oncology company that manages community-based oncology practices for the Company and for independent oncology practices that together serve patients across 17 markets andfive states throughout the United States. As of June 30, 2026, we operate 65 community-based oncology practices, staffed with 125 oncologists and advanced practice providers employed by our affiliated physician-owned professional corporations, referred to as the "Starling PCs." In addition to our Starling-affiliated providers, we also manage a network of 791 providers in Florida under the Florida Oncology Network brand and 11 network providers in California. Collectively across the provider base, as of June 30, 2026, we manage a population of approximately 2.1 million patients under value-based agreements. The Company's mission is to heal and empower cancer patients through compassion, innovation, and state-of-the-art medical care..

Previous wording

Operationally, the Company’s medical centers provide a complete suite of medical oncology services including: physician services, in-house infusion, in-house specialty pharmacy, clinical trials, radiation therapy, educational seminars, support groups, counseling, and 24/7 patient assistance. Many of our services, such as managing clinical trials and palliative care programs, are traditionally accessed through academic and tertiary care settings, while the TOI PCs bring these services to patients in a community setting. As scientific research progresses and more treatment options become available, cancer care is shifting from acute care episodes to chronic disease management. With this shift, it is increasingly important for high-quality, high-value cancer care to be available in a local community setting to all patients in need.

Current wording

Operationally, the Company’s medical centers provide a complete suite of medical oncology services, including: physician services, in-house infusion, in-house specialty pharmacy, clinical trials, radiation therapy, educational seminars, support groups, counseling, and 24/7 patient assistance. Many of our services, such as managing clinical trials and palliative care programs, are traditionally accessed through academic and tertiary care settings, while the Starling PCs bring these services to patients in a community setting. As scientific research progresses and more treatment options become available, cancer care is shifting from acute care episodes to chronic disease management. With this shift, it is increasingly important for high-quality, high-value cancer care to be available in a local community setting to all patients in need.

Previous wording

Capitation revenues consist primarily of fees for medical services provided by the TOI PCs to the Company's patients under a capitated arrangement with various managed care organizations. Capitation revenue is paid monthly based on the number of enrollees by the contracted managed care organization (per member per month or “PMPM”). Capitation contracts generally have a legal term of one year or longer. Payments in capitation contracts are variable since they primarily include PMPM fees associated with unspecified membership that fluctuates throughout the term of the contract; however, based on our experience, our total underlying membership generally increases over time as penetration of Medicare Advantage products grows. Certain contracts include terms for a capitation deduction where the cost of out-of-network referrals of members are deducted from the future payment. Revenue is recognized in the month services are rendered on the basis of the transaction price established at that time.

Current wording

Capitation revenues consist primarily of fees for medical services provided by the Starling PCs to the Company's patients under a capitated arrangement with various managed care organizations. Capitation revenue is paid monthly based on the number of enrollees by the contracted managed care organization (per member per month or “PMPM”). Capitation contracts generally have a legal term of one year or longer. Payments in capitation contracts are variable since they primarily include PMPM fees associated with unspecified membership that fluctuate throughout the term of the contract; however, based on our experience, our total underlying membership generally increases over time as penetration of Medicare Advantage products grows. Certain contracts include terms for a capitation deduction where the cost of out-of-network referrals of members are deducted from the future payment. Revenue is recognized in the month services are rendered on the basis of the transaction price established at that time.

Previous wording

FFS revenue represents revenue earned under contracts in which we bill and collect for specific medical services rendered by the TOI PCs’ employed physicians. The terms for FFS contracts are short in duration and only last for the period over which services are rendered (typically, one day). FFS revenue consists of fees for medical services provided to patients. As specialist providers, our FFS revenue is dependent on referrals from other physicians, such as primary care physicians. The Company's affiliated providers build trusted, professional relationships with these physicians and their associated medical groups, which can lead to recurring FFS volume; however, this volume is subject to numerous factors the Company cannot control and can fluctuate over time. The Company also receives FFS revenue for capitated patients that receive medical services which are excluded from the Company's capitation contracts. Under the FFS arrangements, third-party payors and patients are billed for patient care services provided by the TOI PCs. Payments for services provided are generally less than billed charges. The Company records revenue net of an allowance for contractual adjustments, which represents the net revenue expected to be collected from third-party payors (including managed care, commercial, and governmental payors such as Medicare and Medicaid), and patients. These expected collections are based on fees and negotiated payment rates in the case of third-party payors, the specific benefits provided for under each patient’s healthcare plan, mandated payment rates in the case of Medicare and Medicaid programs, and historical cash collections (net of recoveries). The recognition of net revenue (gross charges less contractual allowances) from such services is dependent on certain factors, such as the proper completion of medical charts following a patient visit, the forwarding of such charts to our billing center for medical coding and entering into the Company's billing system, and the verification of each patient’s submission or representation at the time services are rendered as to the payor(s) responsible for payment of such services. Revenue is recorded on the date the services are rendered based on the information known at the time of entering of such information into the Company's billing systems as well as an estimate of the revenue associated with medical services.

Current wording

FFS revenue represents revenue earned under contracts in which we bill and collect for specific medical services rendered by the Starling PCs’ employed physicians. The terms for FFS contracts are short in duration and only last for the period over which services are rendered (typically, one day). FFS revenue consists of fees for medical services provided to patients. As specialist providers, our FFS revenue is dependent on referrals from other physicians, such as primary care physicians. The Company's affiliated providers build trusted, professional relationships with these physicians and their associated medical groups, which can lead to recurring FFS volume; however, this volume is subject to numerous factors the Company cannot control and can fluctuate over time. The Company also receives FFS revenue for capitated patients that receive medical services which are excluded from the Company's capitation contracts. Under the FFS arrangements, third-party payors and patients are billed for patient care services provided by the Starling PCs. Payments for services provided are generally less than billed charges. The Company records revenue net of an allowance for contractual adjustments, which represents the net revenue expected to be collected from third-party payors (including managed care, commercial, and governmental payors such as Medicare and Medicaid), and patients. These expected collections are based on fees and negotiated payment rates in the case of third-party payors, the specific benefits provided for under each patient’s healthcare plan, mandated payment rates in the case of Medicare and Medicaid programs, and historical cash collections (net of recoveries). The recognition of net revenue (gross charges less contractual allowances) from such services is dependent on certain factors, such as the proper completion of medical charts following a patient visit, the forwarding of such charts to our billing center for medical coding and entering into the Company's billing system, and the verification of each patient’s submission or representation at the time services are rendered as to the payor(s) responsible for payment of such services. Revenue is recorded on the date the services are rendered based on the information known at the time of entering of such information into the Company's billing systems as well as an estimate of the revenue associated with medical services.

Previous wording

Oral prescription drugs prescribed by doctors to their patients are sold directly through the TOI PCs’ dispensaries. Revenue for the prescriptions is based on fee schedules set by various PBMs and other third-party payors.

Current wording

Oral prescription drugs prescribed by doctors to their patients are sold directly through the Starling PCs’ dispensaries. Revenue for the prescriptions is based on fee schedules set by various PBMs and other third-party payors.

Previous wording

The TOI PCs also enter into contracts to perform clinical research trials. The terms for clinical trial contracts last many months as the clinical research is performed. Each contract represents a single, integrated set of research activities that are satisfied over time as the output of results from the trial is captured for the trial sponsor to review. Under the clinical trial contracts, the TOI PCs receive a fixed payment for administrative, set-up, and close-down fees; a fixed amount for each patient site visit; and certain expense reimbursements. The Company recognizes revenue for these arrangements on the fees earned to date based on the state of the trial, as established under contract with the customer. On March 31, 2025, the Company entered into a Research Services Agreement ("RSA") with Helios CR, Inc. ("Helios"), effective May 5, 2025, pursuant to which the Clinical Trials segment is operated by Helios in its entirety under a profit sharing arrangement with the Company. As part of the RSA, there is a Transition Services Agreement, in which certain administrative and professional services are provided by Helios for a certain period of time. Additionally, the Company pays a management fee to Helios on a periodic basis for certain shared services.

Current wording

The Starling PCs also enter into contracts to perform clinical research trials. The terms of the clinical trial contracts vary depending on the length of time required for the clinical research. Each contract represents a single, integrated set of research activities that are satisfied over time as the output of results from the trial is captured for the trial sponsor to review. Under the clinical trial contracts, the Starling PCs receive a fixed payment for administrative, set-up, and close-down fees; a fixed amount for each patient site visit; and certain expense reimbursements. The Company recognizes revenue for these arrangements on the fees earned to date based on the state of the trial, as established under contract with the customer. On March 31, 2025, the Company entered into a Research Services Agreement ("RSA") with Helios CR, Inc. ("Helios"), effective May 5, 2025, pursuant to which the Helios operates our Clinical Trials & other segment under a profit sharing arrangement with the Company. As part of the RSA, there is a Transition Services Agreement, pursuant to which certain administrative and professional services are provided by Helios for a certain period of time. Additionally, the Company pays a management fee to Helios on a periodic basis for certain shared services.

Previous wording

Direct costs - patient services primarily includes chemotherapy drug costs, clinician salaries and benefits, and medical supplies. Clinicians include oncologists, advanced practice providers such as physician assistants and nurse practitioners, and registered nurses employed by the TOI PCs.

Current wording

Direct costs - patient services primarily includes chemotherapy drug costs, clinician salaries and benefits, and medical supplies. Clinicians include oncologists, advanced practice providers such as physician assistants and nurse practitioners, and registered nurses employed by the Starling PCs.

Previous wording

Direct costs - specialty pharmacy primarily includes the cost of oral medications dispensed in the TOI PCs’ clinic locations.

Current wording

Direct costs - specialty pharmacy primarily includes the cost of oral medications dispensed in the Starling PCs’ clinic locations.

Previous wording

Network medical expense is the cost of care delivered by our independent network providers and paid by TOI under our fully delegated contracts. For presentation purposes, we eliminate the portion of network medical expense that is paid to TOI PCs who participate in these fully delegated networks.

Current wording

Network medical expense is the cost of care delivered by our independent network providers and paid by Starling under our fully delegated contracts. For presentation purposes, we eliminate the portion of network medical expense that is paid to Starling PCs who participate in these fully delegated networks.

Previous wording

Comparison of the Three Months Ended March 31, 2026 and 2025

Current wording

Comparison of the Three and Six Months Ended June 30, 2026 and 2025

Previous wording

The increase in patient services revenue for the three months ended March 31, 2026 compared to the same period in the prior year was primarily due to a 54% increase in capitated revenue, partially offset by a 10% decrease in fee-for-service revenue. This was driven by momentum in new markets in addition to the impact of our investments in referral relationship management and our ramp up in new capitated contracts.

Current wording

The increase in patient services revenue for the three and six months ended June 30, 2026 compared to the same periods in the prior year was primarily due to a 48% and 51% increase in capitated revenue, respectively, partially offset by a 17% and 13% decrease, respectively in fee-for-service revenue for the prior year three and six month periods. The increase in capitated revenue was driven by momentum in new markets in addition to the impact of our investments in referral relationship management and our ramp up in new capitated contracts.

Previous wording

The decrease in clinical trials and other revenue was due to the profit sharing agreement as described in Note 1 of the financial statements, compared to the three months ended March 31, 2025.

Current wording

The increase in clinical trials and other revenue, compared to the three and six months ended June 30, 2025, was due to the profit sharing agreement as described in Note 1 of the financial statements.

Previous wording

The increase in patient services cost for the three months ended March 31, 2026 as compared to the same quarter prior year was primarily due to a 10% increase in clinical payroll costs as the Company adjusts physician compensation to better match performance and volume.

Current wording

The increase in patient services cost for the three months ended June 30, 2026 as compared to the same quarter prior year was primarily due to a 17.3% increase in clinical payroll costs as the Company adjusts physician compensation to better match performance and volume, primarily offset by 11.7% decrease in IV drug costs as the Company leverages it's rebate programs with its primary vendor. The increase in patient service costs for the six months ended June 30, 2026 as compared to the same period prior year was primarily due to increases in clinical payroll costs, partially offset by a decrease in IV drug costs.

Previous wording

The increase in specialty pharmacy cost for the three months ended March 31, 2026 was primarily due to a 102.8% increase in the number of prescriptions filled offset by a 12.5% decrease in the average cost of the prescriptions filled, as compared to the same quarter prior year.

Current wording

The increase in specialty pharmacy cost for the three months ended June 30, 2026 was primarily due to a 88.3% increase in the number of prescriptions filled offset by a 19.6% decrease in the average cost of the prescriptions filled, as compared to the three months ended June 30, 2025. The increase in specialty pharmacy cost for the six months ended June 30, 2026 was primarily due to a 94.5% increase in the number of prescriptions filled, partially offset by a 16.3% decrease in the average cost of the prescriptions filled, as compared to the six months ended June 30, 2025.

Previous wording

The decrease in interest expense for the three months ended March 31, 2026 compared to the prior year same period was primarily the result of a prepayment and debt conversion related to the Senior Secured Convertible Note in which the Company recognized a loss of extinguishment of debt of $2,900 during the first quarter of 2025. The decrease in the principal balance of the Senior Secured Convertible Note decreased the Company's interest payments for the remainder of 2025 and continuing into 2026.

Current wording

The decrease in interest expense for the three and six months ended June 30, 2026 compared to the prior year periods was primarily the result of a prepayment and debt conversion related to the Senior Secured Convertible Note in which the Company recognized a loss of extinguishment of debt of $2,900 during the first quarter of 2025. The decrease in the principal balance of the Senior Secured Convertible Notes decreased the Company's interest payments for the remainder of 2025 and continuing into 2026.

Previous wording

The decrease in the fair value of liabilities was primarily due to a $4,996 favorable increase in the fair value of conversion option derivative liabilities due to the stock price decreasing for the three months ended March 31, 2026 as compared to the same period prior quarter.

Current wording

The change in the fair value of liabilities was primarily due to the change in the fair value of conversion option derivative liabilities due to stock price fluctuations, term, risk-free rates and volatility for the three and six months ended June 30, 2026, as compared to the prior year period.

Previous wording

(1)Clinics operated under the TOI PCs, whereby we receive a percentage of revenue under our management services agreements, or MSAs, and are consolidated. Additionally, includes independent oncology practices to which we provide limited management services and have network provider agreements, but do not bear the operating costs.

Current wording

(1)Number of clinics operated under the Starling PCs, whereby we receive a percentage of revenue under our management services agreements, or MSAs, and are consolidated. Additionally, includes independent oncology practices to which we provide limited management services and have network provider agreements, but do not bear the operating costs.

Previous wording

(1)During the three months ended March 31, 2026, non-cash addbacks was primarily comprised of non-cash rent expense.

Current wording

(1)During the three months ended June 30, 2026, non-cash addbacks was primarily comprised of non-cash rent expense. During the three months ended June 30, 2025, non-cash addbacks was primarily comprised of the write-off of the net assets of the Clinical Trials segment of $2,398.

Previous wording

(3)Consulting fees were comprised of a subset of the Company’s total consulting fees, and related to certain non-recurring advisory projects during the three months ended March 31, 2026.

Current wording

(3)Consulting fees were comprised of a subset of the Company’s total consulting fees primarily related to re-branding, and related to certain non-recurring advisory projects during the three months ended June 30, 2026 and 2025.

Previous wording

(4)Infrastructure and workforce costs were comprised of recruiting expenses to build out corporate infrastructure of $169 and $277, severance expenses resulting from cost rationalization programs of $242 and $140, stop-loss contract timing of approximately $1 and $0, EOM/CMS performance period non-recurring addback of $818 and $0, and non-recurring legal fees related to infrastructure build out and settlements of $321 and $782 during the three months ended March 31, 2026 and 2025, respectively.

Current wording

(4) Infrastructure and workforce costs were primarily comprised of recruiting expenses to build out corporate infrastructure of $476 and $150, severance expenses resulting from cost rationalization programs of $257 and $49, stop-loss contract timing of approximately $1 and $1,099, and legal costs related to infrastructure build out and settlements of $172 and $487, partially offset by EOM/CMS performance period non-recurring addback of $818 during the six months ended June 30, 2026 and 2025, respectively.

Previous wording

The accompanying financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business. In connection with the preparation of the condensed consolidated financial statements for the three months ended March 31, 2026, the Company conducted an evaluation as to whether there were conditions and events, considered in the aggregate, which raised substantial doubt as to its ability to continue as a going concern within one year after the date of the issuance of such financial statements. The Company had cash and cash equivalents of $30,280 and an accumulated deficit of $273,911 at March 31, 2026, and a net loss of $2,492 and net cash used in operations of $2,215 for the three months ended March 31, 2026.

Current wording

The accompanying financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business. In connection with the preparation of the condensed consolidated financial statements for the three months ended June 30, 2026, the Company conducted an evaluation as to whether there were conditions and events, considered in the aggregate, which raised substantial doubt as to its ability to continue as a going concern within one year after the date of the issuance of such financial statements.

Previous wording

Significant changes impacting net cash and cash equivalents used in operating activities for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 were as follows:

Current wording

Significant changes impacting net cash and cash equivalents provided by (used in) operating activities for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025 were as follows:

Previous wording

•Cash used by inventory decreased $5,146 due to an increase in quarterly drug buy-ins at period end for participation in rebate programs with our primary supplier; and

Current wording

•Cash used by inventory decreased $2,611 due to a decrease in quarterly drug buy-ins at period end for participation in rebate programs with our primary supplier; and

Previous wording

•Cash provided by accounts payable and accrued expenses increased by $905 primarily due to cash management initiatives with our vendors.

Current wording

•Cash provided by accounts payable and accrued expenses increased by $10,713 primarily due to cash management initiatives with our primary vendors.

Previous wording

Net cash used in investing activities increased $840 for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 primarily due to the increase in purchases of property and equipment of $714 as compared to same period in the prior year.

Current wording

Net cash used in investing activities increased $540 for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025 primarily due to the increase in purchases of property and equipment of $414 as compared to same period in the prior year.

Previous wording

Net cash used in financing activities decreased $4,712 for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025, primarily due to principal payments on the convertible note of $20,000, offset by proceeds from the private placement offering of $15,359 during the three months ended March 31, 2025.

Current wording

Net cash used in financing activities decreased $2,531 for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to principal payments on the convertible note of $20,000, offset by proceeds from the private placement offering of $15,359 and proceeds from option exercises of $2,340 during the six months ended June 30, 2025.

Previous wording

The Company consolidates entities for which it has a variable interest and is determined to be the primary beneficiary. The Company holds variable interests in the TOI PCs, comprised of TOI CA, TOI FL, TOI OR and TOI TX due to jurisdictional laws governing the corporate practice of medicine or other restrictions. The TOI PCs employ physicians and other clinicians in order to provide professional services to patients of our managed clinics, and under substantially similar MSAs, we serve as the exclusive manager and administrator of the TOI PCs’ non-medical functions and services. The TOI PCs are considered variable interest entities (“VIEs”) as they do not have sufficient equity to finance their activities without additional financial support from the Company. An enterprise having a controlling financial interest in a VIE must consolidate the VIE if it has both power and benefits — that is, it has (1) the power to direct the activities of a VIE that most significantly impacts the VIE’s economic performance (power), and (2) the obligation to absorb the losses of the VIE that potentially could be significant to the VIE or the right to receive benefits from the VIE that potentially could be significant to the VIE (benefits). The Company has the power to control all financial activities of the TOI PCs, the rights to receive substantially all benefits from the VIEs, and consequently consolidates the TOI PCs. Revenues, expenses, and income along with the balance sheet accounts from the TOI PCs are included in the consolidated amounts as presented on the Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets.

Current wording

The Company consolidates entities for which it has a variable interest and is determined to be the primary beneficiary. The Company holds variable interests in the Starling PCs, comprised of Starling CA, Starling FL, Starling OR and Starling TX due to jurisdictional laws governing the corporate practice of medicine or other restrictions. The Starling PCs employ physicians and other clinicians in order to provide professional services to patients of our managed clinics, and under substantially similar MSAs, we serve as the exclusive manager and administrator of the Starling PCs’ non-medical functions and services. The Starling PCs are considered variable interest entities (“VIEs”) as they do not have sufficient equity to finance their activities without additional financial support from the Company. An enterprise having a controlling financial interest in a VIE must consolidate the VIE if it has both power and benefits — that is, it has (1) the power to direct the activities of a VIE that most significantly impacts the VIE’s economic performance (power), and (2) the obligation to absorb the losses of the VIE that potentially could be significant to the VIE or the right to receive benefits from the VIE that potentially could be significant to the VIE (benefits). The Company has the power to control all financial activities of the Starling PCs, the rights to receive substantially all benefits from the VIEs, and consequently consolidates the Starling PCs. Revenues, expenses, and income along with the balance sheet accounts from the Starling PCs are included in the consolidated amounts as presented on the Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets.

Previous wording

Consolidated revenue primarily consists of capitation revenue, fee-for-service (FFS) revenue, specialty pharmacy revenue, and clinical trials revenue. Revenue is recognized in the period in which services are rendered or the period in which the TOI PCs are obligated to provide services. The form of billing and related risk of collection for such services may vary by type of revenue and the payor. The following paragraphs provide a summary of the principal forms of billing arrangements and how revenue is recognized for each.

Current wording

Consolidated revenue primarily consists of capitation revenue, fee-for-service (FFS) revenue, specialty pharmacy revenue, and clinical trials revenue. Revenue is recognized in the period in which services are rendered or the period in which the Starling PCs are obligated to provide services. The form of billing and related risk of collection for such services may vary by type of revenue and the payor. The following paragraphs provide a summary of the principal forms of billing arrangements and how revenue is recognized for each.