OPERATING AND REPORTABLE SEGMENTS

3 Months Ended

Mar. 31, 2015

Segment Reporting [Abstract]

Operating and Reportable Segments

OPERATING AND REPORTABLE SEGMENTS

Following the sale of substantially all of the Company’s Home Health Services segment on March 31, 2014, the Company’s operating and reportable segments, “Infusion Services,” and “PBM Services,” reflect how the Company’s chief operating decision maker reviews the Company’s results in terms of allocating resources and assessing performance.

The Infusion Services operating and reportable segment provides services consisting of home infusion therapy, respiratory therapy and the provision of durable medical equipment, products and services. Infusion services include the dispensing and administering of infusion-based drugs, which typically require nursing support and clinical management services, equipment to administer the correct dosage and patient training designed to improve patient outcomes.

The PBM Services operating and reportable segment consists of PBM services, which primarily consists of discount card programs. The discount card programs provide a cost effective alternative for individuals who may be uninsured, underinsured or may have restrictive coverage that disallows reimbursement for certain medications. Under these discount programs, individuals who present a discount card at one of the Company’s participating network pharmacies receive prescription medications at a discounted price compared to the retail price. In addition, in the Company’s capacity as a pharmacy benefit manager, it has fully funded prescription benefit programs where the Company reimburses its network pharmacies and third party payors in turn reimburse the Company based on Medi-Span reported pricing for those claims fulfilled for their plan participants.

The Company’s chief operating decision maker evaluates segment performance and allocates resources based on Segment Adjusted EBITDA. Segment Adjusted EBITDA is defined as income (loss) from continuing operations, net of income taxes adjusted for net interest expense, income tax expense (benefit), depreciation, amortization of intangibles and stock-based compensation expense and prior to the allocation of certain corporate expenses. Segment Adjusted EBITDA excludes acquisition, integration and transitional expenses; restructuring and other expense; and other expenses related to the Company’s strategic assessment. Segment Adjusted EBITDA also excludes the operating losses of start-up branch locations that the Company has invested in organically rather than through acquisition. Segment Adjusted EBITDA is a measure of earnings that management monitors as an important indicator of operating and financial performance. The accounting policies of the operating and reportable segments are consistent with those described in the Company's summary of significant accounting policies.

Segment Reporting Information

(in thousands)

	Three Months Ended   March 31,
	2015			2014
Results of Operations:
Revenue:
Infusion Services - product revenue	$	239,047		$	215,903
Infusion Services - service revenue	5,391			5,166
Total Infusion Services revenue	244,438			221,069
PBM Services - service revenue	17,243			18,224
Total revenue	$	261,681		$	239,293
Adjusted EBITDA by Segment before corporate overhead:
Infusion Services	$	12,699		$	14,961
PBM Services	1,389			1,675
Total Segment Adjusted EBITDA	14,088			16,636
Corporate overhead	(7,768		)	(7,476		)
Interest expense, net	(9,163		)	(10,499		)
Income tax (expense) benefit	(1,928		)	(3,491		)
Depreciation	(4,304		)	(3,836		)
Amortization of intangibles	(1,490		)	(1,703		)
Stock-based compensation expense	(1,657		)	(2,886		)
Acquisition and integration expenses	(220		)	(6,499		)
Restructuring and other expenses and investments	(3,463		)	(5,502		)
Loss from continuing operations, net of income taxes	$	(15,905	)	$	(25,256	)

Supplemental Operating Data
	March 31, 2015		December 31, 2014
Total Assets:
Infusion Services	$	756,417	$	755,955
PBM Services	25,780		29,147
Corporate unallocated, including cash and cash equivalents	63,226		39,611
Total Assets	$	845,423	$	824,713