(State or Other Jurisdiction of Incorporation or Organization) | (IRS Employer Identification No.) |
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | ||||||||||||
Large accelerated filer | ☐ | Accelerated filer | ☐ | ||||||||
☒ | Smaller reporting company | ||||||||||
Emerging growth company |
Page | ||||||||
June 30, 2021 | December 31, 2020 | |||||||||||||
ASSETS | (unaudited) | |||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Restricted cash and cash equivalents | ||||||||||||||
Accounts receivable, net of allowance of $ | ||||||||||||||
Due from related person | ||||||||||||||
Debt and equity investments, of which $ | ||||||||||||||
Prepaid expenses and other current assets | ||||||||||||||
Total current assets | ||||||||||||||
Property and equipment, net | ||||||||||||||
Operating lease right-of-use assets | ||||||||||||||
Finance lease right-of-use assets | ||||||||||||||
Restricted cash and cash equivalents | ||||||||||||||
Restricted debt and equity investments | ||||||||||||||
Equity investment of an investee, net | ||||||||||||||
Other long-term assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||
Current liabilities: | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Accrued expenses and other current liabilities | ||||||||||||||
Accrued compensation and benefits | ||||||||||||||
Accrued self-insurance obligations | ||||||||||||||
Operating lease liabilities | ||||||||||||||
Finance lease liabilities | ||||||||||||||
Due to related persons | ||||||||||||||
Mortgage note payable | ||||||||||||||
Security deposits and current portion of continuing care contracts | ||||||||||||||
Total current liabilities | ||||||||||||||
Long-term liabilities: | ||||||||||||||
Accrued self-insurance obligations | ||||||||||||||
Operating lease liabilities | ||||||||||||||
Finance lease liabilities | ||||||||||||||
Mortgage note payable | ||||||||||||||
Other long-term liabilities | ||||||||||||||
Total long-term liabilities | ||||||||||||||
Commitments and contingencies | ||||||||||||||
Shareholders’ equity: | ||||||||||||||
Common stock, par value $ | ||||||||||||||
Additional paid-in-capital | ||||||||||||||
Accumulated deficit | ( | ( | ||||||||||||
Accumulated other comprehensive income | ||||||||||||||
Total shareholders’ equity | ||||||||||||||
Total liabilities and shareholders' equity | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
REVENUES | ||||||||||||||||||||||||||
Rehabilitation and wellness services | $ | $ | $ | $ | ||||||||||||||||||||||
Senior living | ||||||||||||||||||||||||||
Management fees | ||||||||||||||||||||||||||
Total management and operating revenues | ||||||||||||||||||||||||||
Reimbursed community-level costs incurred on behalf of managed communities | ||||||||||||||||||||||||||
Other reimbursed expenses | ||||||||||||||||||||||||||
Total revenues | ||||||||||||||||||||||||||
Other operating income | ||||||||||||||||||||||||||
OPERATING EXPENSES | ||||||||||||||||||||||||||
Rehabilitation and wellness services expenses | ||||||||||||||||||||||||||
Senior living wages and benefits | ||||||||||||||||||||||||||
Other senior living operating expenses | ||||||||||||||||||||||||||
Community-level costs incurred on behalf of managed communities | ||||||||||||||||||||||||||
General and administrative | ||||||||||||||||||||||||||
Restructuring expenses | ||||||||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||||||||
Total operating expenses | ||||||||||||||||||||||||||
Operating (loss) income | ( | ( | ||||||||||||||||||||||||
Interest, dividend and other income | ||||||||||||||||||||||||||
Interest and other expense | ( | ( | ( | ( | ||||||||||||||||||||||
Unrealized gain (loss) on equity investments | ( | |||||||||||||||||||||||||
Realized gain on sale of debt and equity investments | ||||||||||||||||||||||||||
Loss on termination of leases | ( | |||||||||||||||||||||||||
Income (loss) before income taxes | ( | ( | ( | |||||||||||||||||||||||
(Provision) benefit for income taxes | ( | ( | ( | |||||||||||||||||||||||
Net (loss) income | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||
Weighted average shares outstanding—basic | ||||||||||||||||||||||||||
Weighted average shares outstanding—diluted | ||||||||||||||||||||||||||
Net (loss) income per share—basic | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||
Net (loss) income per share—diluted | $ | ( | $ | $ | ( | $ | ( |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
Net (loss) income | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||
Other comprehensive income (loss): | ||||||||||||||||||||||||||
Unrealized gain (loss) on debt investments, net of tax of $ | ( | |||||||||||||||||||||||||
Realized gain on debt investments reclassified and included in net income (loss), net of tax of $ | ( | ( | ( | ( | ||||||||||||||||||||||
Other comprehensive income (loss) | ( | |||||||||||||||||||||||||
Comprehensive (loss) income | $ | ( | $ | $ | ( | $ | ( |
Three and Six Months Ended June 30, 2021 | |||||||||||||||||||||||||||||||||||
Number of Shares | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income | Total Shareholders' Equity | ||||||||||||||||||||||||||||||
Balance at January 1, 2021 | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||
Comprehensive income (loss): | |||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||
Unrealized loss on debt investments, net of tax | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
Total comprehensive income (loss) | — | — | — | ( | |||||||||||||||||||||||||||||||
Grants under share award plan and share-based compensation | — | — | — | — | |||||||||||||||||||||||||||||||
Repurchases and forfeitures under share award plan | ( | — | ( | — | — | ( | |||||||||||||||||||||||||||||
Balance at March 31, 2021 | ( | ||||||||||||||||||||||||||||||||||
Comprehensive income (loss): | |||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||
Unrealized loss on debt investments, net of tax | — | — | — | — | |||||||||||||||||||||||||||||||
Realized gain on debt investments reclassified and included in net loss, net of tax | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
Total comprehensive income (loss) | — | — | — | ( | ( | ||||||||||||||||||||||||||||||
Grants under share award plan and share-based compensation | — | — | |||||||||||||||||||||||||||||||||
Repurchases and forfeitures under share award plan | ( | — | ( | ( | — | ( | |||||||||||||||||||||||||||||
Balance at June 30, 2021 | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||
Three and Six Months Ended June 30, 2020 | |||||||||||||||||||||||||||||||||||
Number of Shares | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income | Total Shareholders' Equity | ||||||||||||||||||||||||||||||
Balance at January 1, 2020 | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||
Comprehensive income (loss): | |||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||
Unrealized gain on debt investments, net of tax | — | — | — | — | |||||||||||||||||||||||||||||||
Realized gain on debt investments reclassified and included in net loss, net of tax | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
Total comprehensive income (loss) | — | — | — | ( | ( | ||||||||||||||||||||||||||||||
Cumulative effect adjustment to beginning accumulated deficit and accumulated other comprehensive income in connection with a reclassification of equity investments previously classified as debt investments | — | — | — | ( | |||||||||||||||||||||||||||||||
Issuance of common shares | — | — | |||||||||||||||||||||||||||||||||
Grants under share award plan and share-based compensation | — | — | — | ||||||||||||||||||||||||||||||||
Repurchases and forfeitures under share award plan | ( | — | ( | — | — | ( | |||||||||||||||||||||||||||||
Balance at March 31, 2020 | ( | ||||||||||||||||||||||||||||||||||
Comprehensive income (loss): | |||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||
Unrealized gain on debt investments, net of tax | — | — | — | — | |||||||||||||||||||||||||||||||
Realized gain on debt investments reclassified and included in net loss, net of tax | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
Total comprehensive income | — | — | — | ||||||||||||||||||||||||||||||||
Grants under share award plan and share-based compensation | — | — | — | ||||||||||||||||||||||||||||||||
Repurchases and forfeitures under share award plan | ( | — | ( | — | — | ( | |||||||||||||||||||||||||||||
Balance at June 30, 2020 | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||
Six Months Ended June 30, | ||||||||||||||
2021 | 2020 | |||||||||||||
CASH FLOW FROM OPERATING ACTIVITIES: | ||||||||||||||
Net loss | $ | ( | $ | ( | ||||||||||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||||||||
Depreciation and amortization | ||||||||||||||
Unrealized (gain) loss on equity investments | ( | |||||||||||||
Realized gain on sale of debt and equity investments | ( | ( | ||||||||||||
Loss on termination of leases | ||||||||||||||
Long-lived asset impairment | ||||||||||||||
Share-based compensation | ||||||||||||||
Provision for losses on accounts receivables | ||||||||||||||
Other non-cash expense (income) adjustments, net | ||||||||||||||
Changes in assets and liabilities: | ||||||||||||||
Accounts receivable | ( | |||||||||||||
Due from related person | ( | |||||||||||||
Prepaid expenses and other current assets | ( | |||||||||||||
Accounts payable | ( | ( | ||||||||||||
Accrued expenses and other current liabilities | ( | |||||||||||||
Accrued compensation and benefits | ||||||||||||||
Due to related persons | ( | ( | ||||||||||||
Other current and long term liabilities | ||||||||||||||
Net cash provided by operating activities | ||||||||||||||
CASH FLOW FROM INVESTING ACTIVITIES: | ||||||||||||||
Acquisition of property and equipment | ( | ( | ||||||||||||
Purchases of debt and equity investments | ( | ( | ||||||||||||
Proceeds from sale of property and equipment | ||||||||||||||
Distributions in excess of earnings from Affiliates Insurance Company | ||||||||||||||
Proceeds from sale of debt and equity investments | ||||||||||||||
Net cash used in investing activities | ( | ( | ||||||||||||
CASH FLOW FROM FINANCING ACTIVITIES: | ||||||||||||||
Costs related to issuance of common stock | ( | |||||||||||||
Repayments of mortgage notes payable | ( | ( | ||||||||||||
Repayments of finance lease principal | ( | |||||||||||||
Targeted SNF distribution funds received on behalf of others | ||||||||||||||
Payment of employee tax obligations on withheld shares | ( | |||||||||||||
Net cash (used in) provided by financing activities | ( | |||||||||||||
Increase in cash and cash equivalents and restricted cash and cash equivalents | ||||||||||||||
Cash and cash equivalents and restricted cash and cash equivalents at beginning of period | ||||||||||||||
Cash and cash equivalents and restricted cash and cash equivalents at end of period | $ | $ | ||||||||||||
Reconciliation of cash and cash equivalents and restricted cash and cash equivalents: | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Current restricted cash and cash equivalents | ||||||||||||||
Other restricted cash and cash equivalents | ||||||||||||||
Cash and cash equivalents and restricted cash and cash equivalents at end of period | $ | $ | ||||||||||||
Supplemental cash flow information: | ||||||||||||||
Interest paid | $ | $ | ||||||||||||
Income taxes paid (refunded), net | ( | |||||||||||||
Operating lease payments | ||||||||||||||
Financing lease payments | ||||||||||||||
Non-cash investing and financing activities: | ||||||||||||||
Liabilities assumed related to issuance of our common stock | $ | $ | ||||||||||||
Three Months Ended June 30, 2021 | |||||||||||||||||
Senior Living | Rehabilitation and Wellness Services (3) | Total | |||||||||||||||
Private payer | $ | $ | $ | ||||||||||||||
Medicare and Medicaid programs | |||||||||||||||||
Other third-party payer programs | |||||||||||||||||
Management fees | (1) (2) | ||||||||||||||||
Reimbursed community-level costs incurred on behalf of managed communities | (1) (2) | ||||||||||||||||
Other reimbursed expenses | (1) (4) | ||||||||||||||||
Total revenues | $ | $ | $ |
Three Months Ended June 30, 2020 | |||||||||||||||||
Senior Living | Rehabilitation and Wellness Services | Total | |||||||||||||||
Private payer | $ | $ | $ | ||||||||||||||
Medicare and Medicaid programs | |||||||||||||||||
Other third-party payer programs | |||||||||||||||||
Management fees | (1) | ||||||||||||||||
Reimbursed community-level costs incurred on behalf of managed communities | (1) | ||||||||||||||||
Other reimbursed expenses | (1) | ||||||||||||||||
Total revenues | $ | $ | $ |
Six Months Ended June 30, 2021 | |||||||||||||||||
Senior Living | Rehabilitation and Wellness Services(3) | Total | |||||||||||||||
Private payer | $ | $ | $ | ||||||||||||||
Medicare and Medicaid programs | |||||||||||||||||
Other third-party payer programs | |||||||||||||||||
Management fees | (1) (2) | ||||||||||||||||
Reimbursed community-level costs incurred on behalf of managed communities | (1) (2) | ||||||||||||||||
Other reimbursed expenses | (1) (4) | ||||||||||||||||
Total revenues | $ | $ | $ |
Six Months Ended June 30, 2020 | |||||||||||||||||
Senior Living | Rehabilitation and Wellness Services | Total | |||||||||||||||
Private payer | $ | $ | $ | ||||||||||||||
Medicare and Medicaid programs | |||||||||||||||||
Other third-party payer programs | |||||||||||||||||
Management fees | (1) | ||||||||||||||||
Reimbursed community-level costs incurred on behalf of managed communities | (1) | ||||||||||||||||
Other reimbursed expenses | (1) | ||||||||||||||||
Total revenues | $ | $ | $ |
Three Months Ended June 30, 2021 | |||||||||||||||||||||||
Senior Living (1) | Rehabilitation and Wellness Services (2) | Corporate and Other (3) | Total | ||||||||||||||||||||
Revenues | $ | $ | $ | $ | |||||||||||||||||||
Other operating income | |||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||
Operating income (loss) | ( | ( | ( | ||||||||||||||||||||
Allocated corporate and other costs | ( | ( | |||||||||||||||||||||
Other (loss) income, net | ( | ||||||||||||||||||||||
Loss before income taxes | ( | ( | ( | ( | |||||||||||||||||||
Provision for income taxes | ( | ( | |||||||||||||||||||||
Net loss | $ | ( | $ | ( | $ | ( | $ | ( |
Three Months Ended June 30, 2020 | |||||||||||||||||||||||
Senior Living | Rehabilitation and Wellness Services | Corporate and Other | Total | ||||||||||||||||||||
Revenues | $ | $ | $ | $ | |||||||||||||||||||
Other operating income | |||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||
Operating income (loss) | ( | ||||||||||||||||||||||
Allocated corporate and other costs | ( | ( | |||||||||||||||||||||
Other income (loss), net | ( | ||||||||||||||||||||||
Income (loss) before income taxes | ( | ||||||||||||||||||||||
Benefit for income taxes | |||||||||||||||||||||||
Net income (loss) | $ | $ | $ | ( | $ |
Six Months Ended June 30, 2021 | |||||||||||||||||||||||
Senior Living (1) | Rehabilitation and Wellness Services (2) | Corporate and Other (3) | Total | ||||||||||||||||||||
Revenues | $ | $ | $ | $ | |||||||||||||||||||
Other operating income | |||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||
Operating income (loss) | ( | ( | |||||||||||||||||||||
Allocated corporate and other costs | ( | ( | |||||||||||||||||||||
Other (loss) income, net | ( | ||||||||||||||||||||||
Income (loss) before income taxes | ( | ( | |||||||||||||||||||||
Provision for income taxes | ( | ( | |||||||||||||||||||||
Net income (loss) | $ | $ | $ | ( | $ | ( |
Six Months Ended June 30, 2020 | |||||||||||||||||||||||
Senior Living | Rehabilitation and Wellness Services | Corporate and Other | Total | ||||||||||||||||||||
Revenues | $ | $ | $ | $ | |||||||||||||||||||
Other operating income | |||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||
Operating income (loss) | ( | ||||||||||||||||||||||
Allocated corporate and other costs | ( | ( | |||||||||||||||||||||
Other income (loss), net | ( | ( | ( | ||||||||||||||||||||
Income (loss) before income taxes | ( | ( | |||||||||||||||||||||
Benefit for income taxes | ( | ( | |||||||||||||||||||||
Net income (loss) | $ | $ | $ | ( | $ | ( |
June 30, 2021 | December 31, 2020 | |||||||||||||
Land | $ | $ | ||||||||||||
Buildings, construction in process and improvements | ||||||||||||||
Furniture, fixtures and equipment | ||||||||||||||
Property and equipment, at cost | ||||||||||||||
Less: accumulated depreciation | ( | ( | ||||||||||||
Property and equipment, net | $ | $ |
Six Months Ended June 30, 2021 | ||||||||||||||||||||
Equity Investment of an Investee | Investments | Accumulated Other Comprehensive Income | ||||||||||||||||||
Balance at January 1, 2021 | $ | ( | $ | $ | ||||||||||||||||
Unrealized loss on debt investments, net of tax | ( | ( | ||||||||||||||||||
Realized gain on debt investments reclassified and included in net loss, net of tax | ( | ( | ||||||||||||||||||
Balance at June 30, 2021 | $ | ( | $ | $ |
Six Months Ended June 30, 2020 | ||||||||||||||||||||
Equity Investment of an Investee | Investments | Accumulated Other Comprehensive Income | ||||||||||||||||||
Balance at January 1, 2020 | $ | ( | $ | $ | ||||||||||||||||
Cumulative effect adjustment to beginning accumulated deficit and accumulated other comprehensive income in connection with a reclassification of equity investments previously classified as debt investments | ( | ( | ||||||||||||||||||
Unrealized gain on debt investments, net of tax | ||||||||||||||||||||
Realized gain on debt investments reclassified and included in net income, net of tax | ( | ( | ||||||||||||||||||
Balance at June 30, 2020 | $ | ( | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Weighted average shares outstanding—basic | |||||||||||||||||||||||
Effect of dilutive securities: unvested share awards | |||||||||||||||||||||||
Weighted average shares outstanding—diluted (1) |
As of June 30, 2021 | ||||||||||||||||||||||||||
Description | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
Cash equivalents (1) | $ | $ | $ | $ | ||||||||||||||||||||||
Investments: | ||||||||||||||||||||||||||
Equity investments (2) | ||||||||||||||||||||||||||
High yield fund (3) | ||||||||||||||||||||||||||
International bond fund (4) | ||||||||||||||||||||||||||
Financial services industry | ||||||||||||||||||||||||||
Healthcare | ||||||||||||||||||||||||||
Technology | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total equity investments | ||||||||||||||||||||||||||
Debt investments (5) | ||||||||||||||||||||||||||
Industrial bonds | ||||||||||||||||||||||||||
Technology bonds | ||||||||||||||||||||||||||
Government bonds | ||||||||||||||||||||||||||
Energy bonds | ||||||||||||||||||||||||||
Financial bonds | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total debt investments | ||||||||||||||||||||||||||
Total investments | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ |
As of December 31, 2020 | ||||||||||||||||||||||||||
Description | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
Cash equivalents (1) | $ | $ | $ | $ | ||||||||||||||||||||||
Investments: | ||||||||||||||||||||||||||
Equity investments (2) | ||||||||||||||||||||||||||
High yield fund (3) | ||||||||||||||||||||||||||
International bond fund (4) | ||||||||||||||||||||||||||
Financial services industry | ||||||||||||||||||||||||||
Healthcare | ||||||||||||||||||||||||||
Technology | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total equity investments | ||||||||||||||||||||||||||
Debt investments (5) | ||||||||||||||||||||||||||
Industrial bonds | ||||||||||||||||||||||||||
Technology bonds | ||||||||||||||||||||||||||
Government bonds | ||||||||||||||||||||||||||
Energy bonds | ||||||||||||||||||||||||||
Financial bonds | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total debt investments | ||||||||||||||||||||||||||
Total investments | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ |
Amortized Cost | Fair Value | |||||||||||||
Due in one year or less | $ | $ | ||||||||||||
Due after one year through five years | ||||||||||||||
Due after five years through ten years | ||||||||||||||
Total | $ | $ | ||||||||||||
Balance as of June 30, 2021 | Contractual Stated Interest Rate | Effective Interest Rate | Maturity Date | Monthly Payment | Lender | |||||||||||||||||||||||||||||||||||||||||||||
$ | (1) | % | % | September 2032 | $ | Federal Home Loan Mortgage Corporation |
Summary of Liabilities and Expenses as of and for the Three Months Ended June 30, 2021 (1) | ||||||||||||||||||||||||||
Type of Expense: | Beginning Balance | Expenses Incurred | Payments | Ending Balance | ||||||||||||||||||||||
Retention bonuses | $ | $ | $ | $ | ||||||||||||||||||||||
Severance, benefits and transition expenses | ||||||||||||||||||||||||||
Transaction expenses | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ | ||||||||||||||||||||||
Summary of Liabilities and Expenses as of and for the Three Months Ended June 30, 2021 (1) | ||||||||||||||||||||||||||
By Segment: | Beginning Balance | Expenses Incurred | Payments | Ending Balance | ||||||||||||||||||||||
Senior Living | $ | $ | $ | $ | ||||||||||||||||||||||
Rehabilitation and Wellness Services | ||||||||||||||||||||||||||
Corporate and Other | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ | ||||||||||||||||||||||
As of June 30, 2021 | Retained | |||||||||||||
Units (1) | Units (2)(3) | |||||||||||||
Independent living | 10,979 | 10,421 | ||||||||||||
Assisted living | 12,023 | 7,854 | ||||||||||||
Memory care | 3,247 | 1,874 | ||||||||||||
Skilled nursing | 1,484 | — | ||||||||||||
Total | 27,733 | 20,149 |
As of and for the Three Months Ended June 30, 2021 | ||||||||||||||||||||||||||||||||||||||
Communities | Units | Average Occupancy | Spot Occupancy | Community Revenues (1) | Management Fees (2) | |||||||||||||||||||||||||||||||||
Independent and assisted living communities (4) | 209 | 22,980 | 70.0% | 71.9% | $ | 149,998 | $ | 8,011 | ||||||||||||||||||||||||||||||
Continuing care retirement communities (4) | 10 | 1,547 | 69.1% | 66.3% | 77,637 | 4,097 | ||||||||||||||||||||||||||||||||
Skilled nursing facilities | 9 | 955 | 65.2% | 66.2% | 16,312 | 819 | ||||||||||||||||||||||||||||||||
Total | 228 | 25,482 | 69.5% | 71.3% | $ | 243,947 | $ | 12,927 | ||||||||||||||||||||||||||||||
Retained | ||||||||||||||||||||||||||||||||||||||
Communities | Units | Average Occupancy | Spot Occupancy | Community Revenues (1) | Management Fees (3) | |||||||||||||||||||||||||||||||||
Independent and assisted living communities (4) | 120 | 17,898 | 72.9% | 73.3% | $ | 159,014 | $ | 8,552 | ||||||||||||||||||||||||||||||
Continuing care retirement communities | — | — | —% | —% | — | — | ||||||||||||||||||||||||||||||||
Skilled nursing facilities | — | — | —% | —% | — | — | ||||||||||||||||||||||||||||||||
Total | 120 | 17,898 | 72.9% | 73.3% | $ | 159,014 | $ | 8,552 |
As of and for the Six Months Ended June 30, 2021 | ||||||||||||||||||||||||||||||||||||||
Communities | Units | Average Occupancy | Spot Occupancy | Community Revenues (1) | Management Fees (2) | |||||||||||||||||||||||||||||||||
Independent and assisted living communities (4) | 209 | 22,980 | 69.8% | 71.9% | $ | 299,383 | $ | 16,115 | ||||||||||||||||||||||||||||||
Continuing care retirement communities (4) | 10 | 1,547 | 69.6% | 66.3% | 172,377 | 9,045 | ||||||||||||||||||||||||||||||||
Skilled nursing facilities | 9 | 955 | 64.0% | 66.2% | 32,153 | 1,617 | ||||||||||||||||||||||||||||||||
Total | 228 | 25,482 | 69.5% | 71.3% | $ | 503,913 | $ | 26,777 | ||||||||||||||||||||||||||||||
Retained | ||||||||||||||||||||||||||||||||||||||
Communities | Units | Average Occupancy | Spot Occupancy | Community Revenues (1) | Management Fees (3) | |||||||||||||||||||||||||||||||||
Independent and assisted living communities (4) | 120 | 17,898 | 72.8% | 73.3% | $ | 317,291 | $ | 17,158 | ||||||||||||||||||||||||||||||
Continuing care retirement communities | — | — | —% | —% | — | — | ||||||||||||||||||||||||||||||||
Skilled nursing facilities | — | — | —% | —% | — | — | ||||||||||||||||||||||||||||||||
Total | 120 | 17,898 | 72.8% | 73.3% | $ | 317,291 | $ | 17,158 |
As of and for the Three Months Ended June 30, 2021 | Retained | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of Clinics | Total Revenue (3) | Average Revenue per Clinic | Adjusted EBITDA Margin | Number of Clinics | Total Revenue (1)(3) | Average Revenue per Clinic | Adjusted EBITDA Margin | ||||||||||||||||||||||||||||||||||||||||||||||
Inpatient Clinics in DHC Communities | 10 | $ | 2,630 | $ | n/m | 4.8 | % | — | $ | — | $ | — | — | % | |||||||||||||||||||||||||||||||||||||||
Outpatient Clinics in DHC Communities | 91 | 8,354 | 92 | 13.3 | % | 91 | 8,354 | 92 | 13.3 | % | |||||||||||||||||||||||||||||||||||||||||||
Outpatient Clinics in Transition Communities (2) | 44 | 1,919 | 44 | 17.1 | % | 44 | 1,919 | 44 | 17.1 | % | |||||||||||||||||||||||||||||||||||||||||||
Total Clinics at DHC Communities | 145 | 12,903 | 89 | 12.1 | % | 135 | 10,273 | 76 | 14.0 | % | |||||||||||||||||||||||||||||||||||||||||||
Outpatient Clinics at Other Communities (4) | 83 | 4,242 | 51 | 8.5 | % | 83 | 4,242 | 51 | 8.5 | % | |||||||||||||||||||||||||||||||||||||||||||
Total Clinics | 228 | $ | 17,145 | $ | 75 | 11.2 | % | 218 | $ | 14,515 | $ | 67 | 12.4 | % |
As of and for the Six Months Ended June 30, 2021 | Retained | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of Clinics | Total Revenue (3) | Average Revenue per Clinic | Adjusted EBITDA Margin | Number of Clinics | Total Revenue (1)(3) | Average Revenue per Clinic | Adjusted EBITDA Margin | ||||||||||||||||||||||||||||||||||||||||||||||
Inpatient Clinics in DHC Communities | 10 | $ | 8,071 | $ | n/m | 19.6% | — | $ | — | $ | — | —% | |||||||||||||||||||||||||||||||||||||||||
Outpatient Clinics in DHC Communities | 91 | 16,099 | 177 | 14.0% | 91 | 16,099 | 177 | 14.0% | |||||||||||||||||||||||||||||||||||||||||||||
Outpatient Clinics in Transition Communities (2) | 44 | 3,782 | 86 | 17.8% | 44 | 3,782 | 86 | 17.8% | |||||||||||||||||||||||||||||||||||||||||||||
Total Clinics at DHC Communities | 145 | 27,952 | 193 | 10.0% | 135 | 19,881 | 147 | 14.8% | |||||||||||||||||||||||||||||||||||||||||||||
Outpatient Clinics at Other Communities (4) | 83 | 8,465 | 102 | 10.3% | 83 | 8,465 | 102 | 10.3% | |||||||||||||||||||||||||||||||||||||||||||||
Total Clinics | 228 | $ | 36,417 | $ | 160 | 10.1% | 218 | $ | 28,346 | $ | 130 | 13.4% |
Three Months Ended June 30, | Increase/(Decrease) | |||||||||||||||||||||||||
2021 (1) | 2020 (1) | Amount | Percent | |||||||||||||||||||||||
REVENUES | ||||||||||||||||||||||||||
Rehabilitation and wellness services | $ | 17,453 | $ | 19,268 | $ | (1,815) | (9.4) | % | ||||||||||||||||||
Senior living | 16,378 | 19,590 | (3,212) | (16.4) | % | |||||||||||||||||||||
Management fees | 12,927 | 15,705 | (2,778) | (17.7) | % | |||||||||||||||||||||
Total management and operating revenues | 46,758 | 54,563 | (7,805) | (14.3) | % | |||||||||||||||||||||
Reimbursed community-level costs incurred on behalf of managed communities | 195,271 | 224,104 | (28,833) | (12.9) | % | |||||||||||||||||||||
Other reimbursed expenses | 16,592 | 6,417 | 10,175 | n/m | ||||||||||||||||||||||
Total revenues | 258,621 | 285,084 | (26,463) | (9.3) | % | |||||||||||||||||||||
Other operating income | 2 | 1,499 | (1,497) | (99.9) | % | |||||||||||||||||||||
OPERATING EXPENSES | ||||||||||||||||||||||||||
Rehabilitation and wellness services expenses | 15,668 | 16,144 | (476) | (2.9) | % | |||||||||||||||||||||
Senior living wages and benefits | 9,896 | 9,705 | 191 | 2.0 | % | |||||||||||||||||||||
Other senior living operating expenses | 8,968 | 9,016 | (48) | (0.5) | % | |||||||||||||||||||||
Community-level costs incurred on behalf of managed communities | 195,271 | 224,104 | (28,833) | (12.9) | % | |||||||||||||||||||||
General and administrative | 22,748 | 23,392 | (644) | (2.8) | % | |||||||||||||||||||||
Restructuring expenses | 15,389 | 175 | 15,214 | n/m | ||||||||||||||||||||||
Depreciation and amortization | 2,989 | 2,703 | 286 | 10.6 | % | |||||||||||||||||||||
Total operating expenses | 270,929 | 285,239 | (14,310) | (5.0) | % | |||||||||||||||||||||
Operating (loss) income | (12,306) | 1,344 | (13,650) | n/m | ||||||||||||||||||||||
Interest, dividend and other income | 76 | 182 | (106) | (58.2) | % | |||||||||||||||||||||
Interest and other expense | (409) | (409) | — | — | % | |||||||||||||||||||||
Unrealized gain (loss) on equity investments | 398 | 867 | (469) | (54.1) | % | |||||||||||||||||||||
Realized gain on sale of debt and equity investments | 97 | 116 | (19) | (16.4) | % | |||||||||||||||||||||
Income (loss) before income taxes | (12,144) | 2,100 | (14,244) | n/m | ||||||||||||||||||||||
(Provision) benefit for income taxes | (158) | 902 | (1,060) | n/m | ||||||||||||||||||||||
Net (loss) income | $ | (12,302) | $ | 3,002 | $ | (15,304) | n/m | |||||||||||||||||||
Owned and leased communities: | ||||||||||||||||||||||||||
Number of communities (end of period) | 24 | 24 | — | — | % | |||||||||||||||||||||
Number of living units (end of period) | 2,251 | 2,312 | (61) | (2.6) | % | |||||||||||||||||||||
Spot occupancy at June 30, | 69.7 | % | 76.3 | % | (6.6) | % | n/m | |||||||||||||||||||
Average occupancy | 68.1 | % | 78.3 | % | (10.2) | % | n/m | |||||||||||||||||||
RevPAR (2) | $ | 2,425 | $ | 2,813 | $ | (388) | (13.8) | % | ||||||||||||||||||
RevPOR (3) | $ | 3,524 | $ | 3,555 | $ | (31) | (0.9) | % | ||||||||||||||||||
Managed communities: | ||||||||||||||||||||||||||
Number of communities (end of period) | 228 | 241 | (13) | (5.4) | % | |||||||||||||||||||||
Number of living units (end of period) | 25,482 | 28,348 | (2,866) | (10.1) | % | |||||||||||||||||||||
Spot occupancy at June 30, | 71.3 | % | 77.5 | % | (6.2) | % | n/m | |||||||||||||||||||
Average occupancy | 69.5 | % | 78.7 | % | (9.2) | % | n/m | |||||||||||||||||||
RevPAR (2) | $ | 3,086 | $ | 3,576 | $ | (490) | (13.7) | % | ||||||||||||||||||
RevPOR (3) | $ | 4,389 | $ | 4,496 | $ | (107) | (2.4) | % | ||||||||||||||||||
Rehabilitation and wellness services: | ||||||||||||||||||||||||||
Average revenue per outpatient clinic | $ | 67 | $ | 63 | $ | 4 | 6.3 | % | ||||||||||||||||||
Number of visits at outpatient clinics | 156 | 139 | 17 | 12.2 | % | |||||||||||||||||||||
Number of inpatient clinics (end of period) | 10 | 40 | (30) | (75.0) | % | |||||||||||||||||||||
Number of outpatient clinics (end of period) | 218 | 206 | 12 | 5.8 | % | |||||||||||||||||||||
Total clinics | 228 | 246 | (18) | (7.3) | % |
Three Months Ended June 30, | Increase/(Decrease) | |||||||||||||||||||||||||
2021 (4) | 2020 (4) | Amount | Percent | |||||||||||||||||||||||
REVENUES | ||||||||||||||||||||||||||
Rehabilitation and wellness services | $ | 14,151 | $ | 13,292 | $ | 859 | 6.5 | % | ||||||||||||||||||
Senior living | 16,332 | 19,138 | (2,806) | (14.7) | % | |||||||||||||||||||||
Management fees | 8,552 | 9,262 | (710) | (7.7) | % | |||||||||||||||||||||
Other operating income | 2 | 848 | (846) | (99.8) | % | |||||||||||||||||||||
OPERATING EXPENSES | ||||||||||||||||||||||||||
Rehabilitation and wellness services expenses | 12,475 | 11,665 | 810 | 6.9 | % | |||||||||||||||||||||
Senior living wages and benefits | 9,771 | 9,449 | 322 | 3.4 | % | |||||||||||||||||||||
Other senior living operating expenses | 7,380 | 8,680 | (1,300) | (15.0) | % | |||||||||||||||||||||
Owned and leased communities: | ||||||||||||||||||||||||||
Number of communities (end of period) | 23 | 23 | — | — | % | |||||||||||||||||||||
Number of living units (end of period) (1) | 2,251 | 2,260 | (9) | (0.4) | % | |||||||||||||||||||||
Spot occupancy at June 30, | 69.7 | % | 76.6 | % | (6.9) | % | n/m | |||||||||||||||||||
Average occupancy | 68.0 | % | 78.6 | % | (10.6) | % | n/m | |||||||||||||||||||
RevPAR (2) | $ | 2,421 | $ | 2,811 | $ | (390) | (13.9) | % | ||||||||||||||||||
RevPOR (3) | $ | 3,520 | $ | 3,538 | $ | (18) | (0.5) | % | ||||||||||||||||||
Managed communities: | ||||||||||||||||||||||||||
Number of communities (end of period) | 120 | 120 | — | — | % | |||||||||||||||||||||
Number of living units (end of period) (1) | 17,898 | 17,929 | (31) | (0.2) | % | |||||||||||||||||||||
Spot occupancy at June 30, | 73.3 | % | 81.1 | % | (7.8) | % | n/m | |||||||||||||||||||
Average occupancy | 72.9 | % | 82.6 | % | (9.7) | % | n/m | |||||||||||||||||||
RevPAR (2) | $ | 2,961 | $ | 3,301 | $ | (340) | (10.3) | % | ||||||||||||||||||
RevPOR (3) | $ | 4,018 | $ | 3,953 | $ | 65 | 1.6 | % | ||||||||||||||||||
Rehabilitation and wellness services: | ||||||||||||||||||||||||||
Average revenue per outpatient clinic | $ | 71 | $ | 66 | $ | 5 | 7.6 | % | ||||||||||||||||||
Number of visits at outpatient clinics | 149 | 135 | 14 | 10.4 | % | |||||||||||||||||||||
Number of inpatient clinics (end of period) | — | — | — | — | % | |||||||||||||||||||||
Number of outpatient clinics (end of period) | 195 | 195 | — | — | % | |||||||||||||||||||||
Total clinics | 195 | 195 | — | — | % |
Six Months Ended June 30, | Increase/(Decrease) | |||||||||||||||||||||||||
2021 (1) | 2020 (1) | Amount | Percent | |||||||||||||||||||||||
REVENUES | ||||||||||||||||||||||||||
Rehabilitation and wellness services | $ | 37,006 | $ | 40,652 | $ | (3,646) | (9.0) | % | ||||||||||||||||||
Senior living | 33,435 | 40,587 | (7,152) | (17.6) | % | |||||||||||||||||||||
Management fees | 26,777 | 32,756 | (5,979) | (18.3) | % | |||||||||||||||||||||
Total management and operating revenues | 97,218 | 113,995 | (16,777) | (14.7) | % | |||||||||||||||||||||
Reimbursed community-level costs incurred on behalf of managed communities | 408,431 | 456,120 | (47,689) | (10.5) | % | |||||||||||||||||||||
Other reimbursed expenses | 22,072 | 12,414 | 9,658 | 77.8 | % | |||||||||||||||||||||
Total revenues | 527,721 | 582,529 | (54,808) | (9.4) | % | |||||||||||||||||||||
Other operating income | 7,795 | 1,499 | 6,296 | n/m | ||||||||||||||||||||||
OPERATING EXPENSES | ||||||||||||||||||||||||||
Rehabilitation and wellness services expenses | 31,878 | 33,645 | (1,767) | (5.3) | % | |||||||||||||||||||||
Senior living wages and benefits | 21,909 | 19,505 | 2,404 | 12.3 | % | |||||||||||||||||||||
Other senior living operating expenses | 15,234 | 12,954 | 2,280 | 17.6 | % | |||||||||||||||||||||
Community-level costs incurred on behalf of managed communities | 408,431 | 456,120 | (47,689) | (10.5) | % | |||||||||||||||||||||
General and administrative | 45,139 | 45,162 | (23) | (0.1) | % | |||||||||||||||||||||
Restructuring expenses | 15,639 | 1,270 | 14,369 | n/m | ||||||||||||||||||||||
Depreciation and amortization | 5,929 | 5,404 | 525 | 9.7 | % | |||||||||||||||||||||
Total operating expenses | 544,159 | 574,060 | (28,134) | (4.9) | % | |||||||||||||||||||||
Operating (loss) income | (8,643) | 9,968 | (20,378) | n/m | ||||||||||||||||||||||
Interest, dividend and other income | 160 | 521 | (361) | (69.3) | % | |||||||||||||||||||||
Interest and other expense | (872) | (791) | (81) | 10.2 | % | |||||||||||||||||||||
Unrealized gain (loss) on equity investments | 533 | (595) | 1,128 | n/m | ||||||||||||||||||||||
Realized gain on sale of debt and equity investments | 193 | 95 | 98 | n/m | ||||||||||||||||||||||
Loss on termination of leases | — | (22,899) | 22,899 | (100.0) | % | |||||||||||||||||||||
Income (loss) before income taxes | (8,629) | (13,701) | 3,305 | (24.1) | % | |||||||||||||||||||||
Provision for income taxes | (358) | (506) | 148 | (29.2) | % | |||||||||||||||||||||
Net loss | $ | (8,987) | $ | (14,207) | $ | 5,220 | (36.7) | % | ||||||||||||||||||
Owned and leased communities: | ||||||||||||||||||||||||||
Number of communities (end of period) | 24 | 24 | — | — | % | |||||||||||||||||||||
Number of living units (end of period) | 2,251 | 2,312 | (61) | (2.6) | % | |||||||||||||||||||||
Spot occupancy at June 30, | 69.7 | % | 76.3 | % | (6.6) | % | n/m | |||||||||||||||||||
Average occupancy | 68.2 | % | 79.8 | % | (11.6) | % | n/m | |||||||||||||||||||
RevPAR (2) | $ | 2,453 | $ | 2,872 | $ | (419) | (14.6) | % | ||||||||||||||||||
RevPOR (3) | $ | 3,577 | $ | 3,560 | $ | 17 | 0.5 | % | ||||||||||||||||||
Managed communities: | ||||||||||||||||||||||||||
Number of communities (end of period) | 228 | 241 | (13) | (5.4) | % | |||||||||||||||||||||
Number of living units (end of period) | 25,482 | 28,348 | (2,866) | (10.1) | % | |||||||||||||||||||||
Spot occupancy at June 30, | 71.3 | % | 77.5 | % | (6.2) | % | n/m | |||||||||||||||||||
Average occupancy | 69.5 | % | 80.7 | % | (11.2) | % | n/m | |||||||||||||||||||
RevPAR (2) | $ | 3,150 | $ | 3,699 | $ | (549) | (14.8) | % | ||||||||||||||||||
RevPOR (3) | $ | 4,507 | $ | 4,571 | $ | (64) | (1.4) | % | ||||||||||||||||||
Rehabilitation and wellness services: | ||||||||||||||||||||||||||
Average revenue per outpatient clinic | $ | 130 | $ | 126 | $ | 4 | 3.2 | % | ||||||||||||||||||
Number of visits at outpatient clinics | 305 | 277 | 28 | 10.1 | % | |||||||||||||||||||||
Number of inpatient clinics (end of period) | 10 | 40 | (30) | (75.0) | % | |||||||||||||||||||||
Number of outpatient clinics (end of period) | 218 | 206 | 12 | 5.8 | % | |||||||||||||||||||||
Total clinics | 228 | 246 | (18) | (7.3) | % |
Six Months Ended June 30, | Increase/(Decrease) | |||||||||||||||||||||||||
2021 (4) | 2020 (4) | Amount | Percent | |||||||||||||||||||||||
REVENUES | ||||||||||||||||||||||||||
Rehabilitation and wellness services | $ | 26,240 | $ | 25,569 | $ | 671 | 2.6 | % | ||||||||||||||||||
Senior living | 33,008 | 39,625 | (6,617) | (16.7) | % | |||||||||||||||||||||
Management fees | 17,146 | 18,891 | (1,745) | (9.2) | % | |||||||||||||||||||||
Other operating income | 7,581 | 828 | 6,753 | n/m | ||||||||||||||||||||||
OPERATING EXPENSES | ||||||||||||||||||||||||||
Rehabilitation and wellness services expenses | 22,901 | 22,844 | 57 | 0.2 | % | |||||||||||||||||||||
Senior living wages and benefits | 21,563 | 19,014 | 2,549 | 13.4 | % | |||||||||||||||||||||
Other senior living operating expenses | 13,229 | 12,279 | 950 | 7.7 | % | |||||||||||||||||||||
Owned and leased communities: | ||||||||||||||||||||||||||
Number of communities (end of period) | 23 | 23 | — | — | % | |||||||||||||||||||||
Number of living units (end of period) (1) | 2,251 | 2,260 | (9) | (0.4) | % | |||||||||||||||||||||
Spot occupancy at June 30, | 69.7 | % | 76.6 | % | (6.9) | % | n/m | |||||||||||||||||||
Average occupancy | 68.3 | % | 80.0 | % | (11.7) | % | n/m | |||||||||||||||||||
RevPAR (2) | $ | 2,451 | $ | 2,867 | $ | (416) | (14.5) | % | ||||||||||||||||||
RevPOR (3) | $ | 3,566 | $ | 3,543 | $ | 23 | 0.6 | % | ||||||||||||||||||
Managed communities: | ||||||||||||||||||||||||||
Number of communities (end of period) | 120 | 120 | — | — | % | |||||||||||||||||||||
Number of living units (end of period) (1) | 17,898 | 17,929 | (31) | (0.2) | % | |||||||||||||||||||||
Spot occupancy at June 30, | 73.3 | % | 81.1 | % | (7.8) | % | n/m | |||||||||||||||||||
Average occupancy | 72.8 | % | 84.3 | % | (11.5) | % | n/m | |||||||||||||||||||
RevPAR (2) | $ | 2,954 | $ | 3,386 | $ | (432) | (12.8) | % | ||||||||||||||||||
RevPOR (3) | $ | 4,035 | $ | 3,972 | $ | 63 | 1.6 | % | ||||||||||||||||||
Rehabilitation and wellness services: | ||||||||||||||||||||||||||
Average revenue per outpatient clinic | $ | 132 | $ | 127 | $ | 5 | 3.9 | % | ||||||||||||||||||
Number of visits at outpatient clinics | 279 | 263 | 16 | 6.1 | % | |||||||||||||||||||||
Number of inpatient clinics (end of period) | — | — | — | — | % | |||||||||||||||||||||
Number of outpatient clinics (end of period) | 182 | 182 | — | — | % | |||||||||||||||||||||
Total clinics | 182 | 182 | — | — | % |
Six Months Ended June 30, | ||||||||||||||||||||||||||
Net cash provided by (used in) | 2021 | 2020 | $ Change | % Change | ||||||||||||||||||||||
Operating Activities | $ | 17,880 | $ | 40,158 | $ | (22,278) | (55.5) | % | ||||||||||||||||||
Investing Activities | (2,662) | (350) | (2,312) | 660.6 | % | |||||||||||||||||||||
Financing Activities | (604) | 3,966 | (4,570) | (115.2) | % | |||||||||||||||||||||
Increase in cash and cash equivalents and restricted cash and cash equivalents | 14,614 | 43,774 | (29,160) | (66.6) | % | |||||||||||||||||||||
Cash and cash equivalents and restricted cash and cash equivalents at beginning of period | 109,597 | 56,979 | 52,618 | 92.3 | % | |||||||||||||||||||||
Cash and cash equivalents and restricted cash and cash equivalents at end of period | $ | 124,211 | $ | 100,753 | $ | 23,458 | 23.3 | % |
Calendar Month | Number of Shares Purchased (1) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs | |||||||||||||||||||||||||||||||||||||
June 2021 | 483 | $ | 5.76 | — | $ | — | |||||||||||||||||||||||||||||||||||
Total | 483 | $ | 5.76 | — | $ | — |
Incorporated by Reference | ||||||||||||||||||||||||||||||||||||||
Exhibit Number | Description | Form | Exhibit Number | File Number | Filing Date | Filed Herewith | ||||||||||||||||||||||||||||||||
3.1 | 10-Q | 3.1 | 001-16817 | 11/6/2019 | ||||||||||||||||||||||||||||||||||
3.2 | 10-K | 3.6 | 001-16817 | 3/3/2017 | ||||||||||||||||||||||||||||||||||
4.1 | 10-Q | 4.1 | 001-16817 | 11/6/2019 | ||||||||||||||||||||||||||||||||||
4.2 | 8-K | 10.1 | 001-16817 | 10/6/2016 | ||||||||||||||||||||||||||||||||||
10.1 | 8-K | 10.1 | 001-16817 | 6/9/2021 | ||||||||||||||||||||||||||||||||||
10.2 | 8-K | 10.2 | 001-16817 | 6/9/2021 | ||||||||||||||||||||||||||||||||||
10.3 | 8-K | 10.3 | 001-16817 | 6/8/2021 | ||||||||||||||||||||||||||||||||||
31.1 | 10-Q | 31.1 | X |
Incorporated by Reference | ||||||||||||||||||||||||||||||||||||||
Exhibit Number | Description | Form | Exhibit Number | File Number | Filing Date | Filed Herewith | ||||||||||||||||||||||||||||||||
31.2 | 10-Q | 31.2 | X | |||||||||||||||||||||||||||||||||||
32.1 | 10-Q | 32.1 | X | |||||||||||||||||||||||||||||||||||
101.INS | XBRL Instance Document- the instance document does not appear in the Interactive Date File because its XBRL tags are embedded within the Inline XBRL document. | X | ||||||||||||||||||||||||||||||||||||
101.SCH | XBRL Taxonomy Extension Schema Document. (Filed herewith.) | X | ||||||||||||||||||||||||||||||||||||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. (Filed herewith.) | X | ||||||||||||||||||||||||||||||||||||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. (Filed herewith.) | X | ||||||||||||||||||||||||||||||||||||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. (Filed herewith.) | X | ||||||||||||||||||||||||||||||||||||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. (Filed herewith.) | X | ||||||||||||||||||||||||||||||||||||
104 | Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101). | X |
FIVE STAR SENIOR LIVING INC. | |||||
Katherine E. Potter | |||||
President and Chief Executive Officer | |||||
(Principal Executive Officer) | |||||
Dated: August 4, 2021 | |||||
Jeffrey C. Leer | |||||
Executive Vice President, Chief Financial Officer and Treasurer | |||||
(Principal Financial Officer and Principal Accounting Officer) | |||||
Dated: August 4, 2021 | |||||
/s/ Katherine E. Potter | |||||
Date: August 4, 2021 | Katherine E. Potter | ||||
President and Chief Executive Officer |
/s/ Jeffrey C. Leer | |||||
Date: August 4, 2021 | Jeffrey C. Leer | ||||
Executive Vice President, Chief Financial Officer and Treasurer |
/s/ Katherine E. Potter | |||||
Katherine E. Potter | |||||
President and Chief Executive Officer | |||||
/s/ Jeffrey C. Leer | |||||
Jeffrey C. Leer | |||||
Executive Vice President, Chief Financial Officer and Treasurer | |||||
Date: August 4, 2021 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Accounts receivable, net of allowance | $ 3,496 | $ 3,149 |
Investments, restricted | $ 8,614 | $ 11,125 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 75,000,000 | 75,000,000 |
Common stock, shares issued (in shares) | 31,761,128 | 31,679,207 |
Common stock, shares outstanding (in shares) | 31,761,128 | 31,679,207 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net (loss) income | $ (12,302) | $ 3,002 | $ (8,987) | $ (14,207) |
Other comprehensive income (loss): | ||||
Unrealized gain (loss) on debt investments, net of tax of $0 | 44 | 303 | (250) | 730 |
Realized gain on debt investments reclassified and included in net income (loss), net of tax of $0 | (18) | (3) | (18) | (13) |
Other comprehensive income (loss) | 26 | 300 | (268) | 717 |
Comprehensive (loss) income | $ (12,276) | $ 3,302 | $ (9,255) | $ (13,490) |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
|
Statement of Comprehensive Income [Abstract] | ||||
Tax on unrealized gain (loss) on debt investments | $ 0 | $ 0 | $ 0 | $ 0 |
Tax on realized (gain) loss on debt investments | $ 0 | $ 0 | $ 0 | $ 0 |
Basis of Presentation and Organization |
6 Months Ended |
---|---|
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Organization | Basis of Presentation and Organization General. The accompanying condensed consolidated financial statements of Five Star Senior Living Inc. and its subsidiaries are unaudited. Certain information and disclosures required by the rules and regulations of the Securities and Exchange Commission, or SEC, and U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted pursuant to SEC rules and regulations related to interim financial statements. We believe the disclosures made are adequate to make the information presented not misleading. As of June 30, 2021, we managed or operated 252 senior living communities located in 31 states with 27,733 living units, including 243 primarily independent and assisted living communities with 26,778 living units, which include ten continuing care retirement communities, or CCRCs, with 1,547 living units, and nine primarily skilled nursing facilities, or SNFs, with 955 living units. As of June 30, 2021, we managed 228 of these senior living communities (25,482 living units), we owned and operated 20 of these senior living communities (2,099 living units) and we leased and operated four of these senior living communities (152 living units). Our 252 senior living communities, as of June 30, 2021, included 10,979 independent living apartments, 15,270 assisted living suites (which includes 3,247 of our Bridge to Rediscovery memory care units) and 1,484 SNF units. The foregoing numbers exclude living units categorized as out of service. Our rehabilitation and wellness services segment, which is primarily comprised of Five Star Rehabilitation and Wellness Services doing business as Ageility Physical Therapy Solutions, or Ageility, provides a comprehensive suite of rehabilitation, personal fitness, and wellness services at our senior living communities as well as at outpatient clinics located at unaffiliated senior living communities. As of June 30, 2021, we operated ten inpatient rehabilitation and wellness services clinics in senior living communities owned by Diversified Healthcare Trust, or DHC, which are managed by us. As of June 30, 2021, we operated 218 outpatient rehabilitation and wellness services clinics, of which 151 were located at our managed and owned senior living communities and 67 were located within senior living communities not owned or leased by us or managed on behalf of DHC. Strategic Plan. On April 9, 2021, we announced a new strategic plan, or the Strategic Plan, including to: •Reposition our senior living management service offering to focus on larger independent living, assisted living and memory care communities, as well as stand-alone independent living and active adult communities; and exit skilled nursing; •Evolve through an enhanced scalable shared service center to support operations and growth, the development of and delivery of differentiated, customer focused resident experiences, as well as through home health and concierge offerings. We are expanding our Ageility service line by introducing innovative fitness and personal training offerings to complement outpatient therapy, and home health services, including strength training, orthopedic rehabilitation, fall prevention, cognitive or memory enhancement, aquatic therapy, and general personal fitness and wellness programs; and •Diversify with a focus on revenue diversification opportunities, including growing Ageility rehabilitation services and expanding ancillary services to provide choice based, financially flexible resident experience and reach customers outside of our senior living communities. During the three months ended June 30, 2021, we made the following progress with respect to implementation of the Strategic Plan: •We amended our management arrangements with DHC on June 9, 2021, see Note 11 for additional information on the amendments to the management arrangements with DHC, •Closed as of June 30, 2021, 1,473 of the approximately 1,500 SNF living units planned for closure in 26 of the 27 CCRCs, and is in the process of repositioning these SNF living units, •Closed as of June 30, 2021, 27 of the planned 37 Ageility inpatient rehabilitation clinics. •In July 2021, DHC entered into agreements to transition the management of 76 of the 108 transitioning senior living communities, with approximately 5,200 living units, to new operators in 2021. In connection with the repositioning of our senior living management services, we expect to incur restructuring expenses of up to $20,500, approximately $15,000 of which we expect DHC will reimburse. These expenses are expected to include up to $7,500 of retention bonus payments, up to $10,200 of severance, benefits and transition expenses, and up to $2,800 of transaction expenses, of which we expect DHC to reimburse approximately $5,900, $7,500 and $1,600, respectively. We recognized restructuring expenses of $15,389 and $15,639 related to the Strategic Plan for the three and six months ended June 30, 2021, respectively, which was partially offset by $11,531 of other reimbursed expenses related to the amounts to be reimbursed by DHC for both the three and six months ended June 30, 2021. See Note 16 for summary of restructuring expenses and the corresponding liability. See Notes 11, 16 and 17 for more information on the Strategic Plan, the amendments to our management arrangements and our business arrangements with DHC. See Note 17 for summary of further progress made on the repositioning of our senior living management services during July 2021. Reclassifications. We have made reclassifications to the financial statements of prior periods to conform to the current period presentation. These reclassifications had no effect on net income (loss) or shareholders’ equity. The accompanying financial statements should be read in conjunction with the financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2020, or our Annual Report. In the opinion of our management, all adjustments, which include only normal recurring adjustments considered necessary for a fair presentation, have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Our operating results for interim periods are not necessarily indicative of the results that may be expected for the full year.
|
Summary of Significant Accounting Policies |
6 Months Ended |
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Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Estimates and Assumptions. The preparation of these financial statements in conformity with GAAP requires us to make estimates and assumptions that may affect the amounts reported in these condensed consolidated financial statements and related notes. Significant estimates in our condensed consolidated financial statements relate to revenue recognition, including contractual allowances, the allowance for doubtful accounts, self-insurance reserves and estimates concerning our provision for income taxes or valuation allowance related to deferred tax assets. Our actual results could differ from our estimates. We periodically review estimates and assumptions and we reflect the effects of changes, if any, in the condensed consolidated financial statements in the period that they are determined. There have been no changes to our significant accounting policies disclosed in our Annual Report, except for the additional disclosure noted below. See summary of significant accounting policies in our Annual Report. Accounting for Costs Associated with Exit or Disposal Activities. A liability for costs associated with exit or disposal activities other than in a business combination, is recognized when the liability is incurred. The liability, recognized under ASC 420, Exit or Disposal Cost Obligations and ASC 712, Compensation — Nonretirement Postemployment - special termination benefits, is measured at fair value, with adjustments for changes in estimated cash flows recognized in earnings. During the three months ended June 30, 2021 costs were incurred related to the Strategic Plan. See Note 16 for summary of restructuring expenses and the corresponding liability. Recently Issued Accounting Pronouncements Not Yet Adopted. In June 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, No. 2016-13, Financial Instruments-Credit Losses (Topic 326), which requires a financial asset or a group of financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. This ASU eliminates the probable initial recognition threshold and instead requires reflection of an entity’s current estimate of all expected credit losses. In addition, this ASU amends the current other-than-temporary impairment model for available for sale debt securities. The length of time that the fair value of an available for sale debt security has been below the amortized cost will no longer impact the determination of whether a credit loss exists and credit losses will now be limited to the difference between a security’s amortized cost basis and its fair value. In November 2018, the FASB issued ASU No. 2018-19, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, which amends the transition and effective date for nonpublic entities and smaller reporting companies, such as us, and clarifies that receivables arising from operating leases are not in the scope of this ASU. In November 2019, the FASB issued ASU No. 2019-11, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, which clarifies guidance around how to report expected recoveries. Entities will apply the provisions of the ASU as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. This ASU is effective for smaller reporting companies for reporting periods beginning after December 15, 2022. We are assessing the potential impact that the adoption of this ASU (and the related clarifying guidance issued by the FASB) will have on our condensed consolidated financial statements. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides temporary optional expedients and exceptions on contract modifications meeting certain criteria to ease the financial reporting burdens of the expected market transition from the London Inter-bank Offered Rate, or LIBOR, and other interbank offered rates to the alternative reference rates. For a contract that meets the criteria, this ASU generally allows an entity to account for and present modifications as an event that does not require remeasurement at the modification date or reassessment of a previous accounting determination. This ASU was effective upon issuance and can be applied through December 31, 2022. We expect this ASU will not have a material impact on our condensed consolidated financial statements.
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Revenue and Other Operating Income |
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Revenue and Other Operating Income | Revenue and Other Operating Income The following tables present revenue from contracts by segment with customers disaggregated by type of payer, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors:
_______________________________________ (1) Represents separate revenue streams earned from DHC; see Note 4 for discussion of Segment Information. (2) (i) We intend to transition 108 senior living communities managed on behalf of DHC with approximately 7,500 living units to new operators in 2021 and (ii) we closed 1,473 SNF units in 26 CCRCs in the three months ended June 30, 2021 and are in the process of repositioning them and expect to close and reposition an additional 59 SNF units in one CCRC during the remainder of 2021 that we will continue to manage for DHC. The management fees we recognized related to these communities and units for the three months ended June 30, 2021 was $4,378. See Notes 1, 11, 16 and 17 for more information. (3) 27 Ageility inpatient rehabilitation clinics were closed in the three months ended June 30, 2021 and we expect to close an additional ten Ageility inpatient rehabilitation clinics during the remainder of 2021. Revenue related to these clinics for the three months ended June 30, 2021 was $2,630. See Notes 1, 16 and 17 for more information. (4) Includes $11,531 of restructuring expenses to be reimbursed by DHC for the three months ended June 30, 2021.
_______________________________________ (1) Represents separate revenue streams earned from DHC.
_______________________________________ (1) Represents separate revenue streams earned from DHC; see Note 4 for discussion of Segment Information. (2) (i) We intend to transition 108 senior living communities managed on behalf of DHC with approximately 7,500 living units to new operators in 2021 and (ii) we closed 1,473 SNF units in 26 CCRCs in the six months ended June 30, 2021 and are in the process of repositioning them and expect to close and reposition an additional 59 SNF units in one CCRC during the remainder of 2021 that we will continue to manage for DHC. The management fees we recognized related to these communities and units for the six months ended June 30, 2021 was $9,619. See Notes 1, 11, 16 and 17 for more information. (3) 27 Ageility inpatient rehabilitation clinics were closed in the six months ended June 30, 2021 and we expect to close an additional ten Ageility inpatient rehabilitation clinics during the remainder of 2021. Revenue related to these clinics for the six months ended June 30, 2021 was $8,071. See Notes 1, 16 and 17 for more information. (4) Includes $11,531 of restructuring expenses to be reimbursed by DHC for the six months ended June 30, 2021.
_______________________________________ (1) Represents separate revenue streams earned from DHC. Other operating income. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, was signed into law. Under the CARES Act, the U.S. Department of Health and Human Services, or HHS, established the Provider Relief Fund. The Provider Relief Fund was further supplemented on December 27, 2020 by the Consolidated Appropriations Act, 2021. Retention and use of the funds received under the CARES Act are subject to certain terms and conditions, including certain reporting requirements. Other operating income includes income recognized for funds we have received pursuant to the Provider Relief Fund of the CARES Act for which we have determined that we were in compliance with the terms and conditions of the Provider Relief Fund of the CARES Act. We recognize other operating income in our condensed consolidated statements of operations to the extent we estimate we have COVID-19 incurred losses or related costs for which provisions of the CARES Act is intended to compensate. The amount of income we recognize for these estimated losses and costs is limited to the amount of funds we received during the period in which the estimated losses and costs were recognized or incurred or, if funds were received subsequently, the period in which the funds were received. We recognized other operating income of $2 and $1,499 for the three months ended June 30, 2021 and 2020, respectively, and $7,795 and $1,499 for the six months ended June 30, 2021 and 2020, respectively. See Note 15 for more information.
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Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information We do not allocate assets to operating segments and, therefore, no asset information is provided for reportable segments. Certain of our general and administrative expenses incurred at our corporate office are deemed centralized services and allocated amongst operating segments. Centralized services are largely determined by job function and allocated by percentage of total revenue. Results of operations and selected financial information by reportable segment and the reconciliation to the condensed consolidated financial statements are as follows:
_______________________________________ (1) (i) We intend to transition 108 senior living communities managed on behalf of DHC with approximately 7,500 living units to new operators in 2021 and (ii) we closed 1,473 SNF units in 26 CCRCs in the three months ended June 30, 2021 and are in the process of repositioning them and expect to close and reposition an additional 59 SNF units in one CCRC during the remainder of 2021 that we will continue to manage for DHC. See Notes 1, 11, 16 and 17 for more information. As more fully described in Note 16, the senior living segment recognized $11,531 of restructuring expenses related to the Strategic Plan and $11,531 of other reimbursed expenses in the three months ended June 30, 2021. (2) 27 Ageility inpatient rehabilitation clinics were closed in the three months ended June 30, 2021 and we expect to close an additional ten Ageility inpatient rehabilitation clinics during the remainder of 2021. See Notes 1, 16 and 17 for more information. As more fully described in Note 16, the rehabilitation and wellness services segment recognized $1,720 of restructuring expenses related to the Strategic Plan in the three months ended June 30, 2021. (3) As more fully described in Note 16, Corporate and Other recognized $2,138 of restructuring expenses related to the Strategic Plan in the three months ended June 30, 2021.
_______________________________________ (1) (i) We intend to transition 108 senior living communities managed on behalf of DHC with approximately 7,500 living units to new operators in 2021 and (ii) we closed 1,473 SNF units in 26 CCRCs in the six months ended June 30, 2021 and are in the process of repositioning them and expect to close and reposition an additional 59 SNF units in one CCRC during the remainder of 2021 that we will continue to manage for DHC. See Notes 1, 11, 16 and 17 for more information. As more fully described in Note 16, the senior living segment recognized $11,531 of restructuring expenses related to the Strategic Plan and $11,531 of other reimbursed expenses in the six months ended June 30, 2021. (2) 27 Ageility inpatient rehabilitation clinics were closed in the six months ended June 30, 2021 and we expect to close an additional ten Ageility inpatient rehabilitation clinics during the remainder of 2021. See Notes 1, 16 and 17 for more information. As more fully described in Note 16, the rehabilitation and wellness services segment recognized $1,720 of restructuring expenses related to the Strategic Plan in the six months ended June 30, 2021. (3) As more fully described in Note 16, Corporate and Other recognized $2,388 of restructuring expenses related to the Strategic Plan in the six months ended June 30, 2021.
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Property and Equipment, net |
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Property and Equipment, net | Property and Equipment, net Property and equipment, net consist of the following:
On April 4, 2021, one of the communities that we lease from Healthpeak Properties Inc., or PEAK, had a fire, that caused extensive damage to the community. As a result, we recorded an impairment on certain furniture, fixtures and equipment and building improvements for the three and six months ended June 30, 2021 of $890 which is recorded in other senior living expenses in the statement of operations. We recorded depreciation expense relating to our property and equipment of $2,699 and $2,703 for the three months ended June 30, 2021 and 2020, respectively, and $5,390 and $5,404 for the six months ended June 30, 2021 and 2020, respectively.
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Accumulated Other Comprehensive Income |
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Accumulated Other Comprehensive Income | Accumulated Other Comprehensive Income The following tables detail the changes in accumulated other comprehensive income (loss), net of tax, for the six months ended June 30, 2021 and 2020:
Accumulated other comprehensive income represents the unrealized gains and losses of our debt investments, net of tax, and our share of other comprehensive income (loss) relating to our former investment in Affiliates Insurance Company which dissolved on February 13, 2020. The cost of debt investments sold and for which realized gains and losses are reclassified and included in net income are determined on a specific identification basis. As of January 1, 2020, we reclassified certain of our investments from debt investments to equity investments to reflect the nature of the investment rather than the nature of the securities held by the investment. As a result, we reclassified the related unrealized gain of $1,694 from accumulated other comprehensive income to accumulated deficit on January 1, 2020.
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Income Taxes |
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Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We recognized a provision for income taxes of $158 and $358 for the three and six months ended June 30, 2021, respectively. We recognized a benefit for income taxes of $902 and a provision for income taxes of $506 for the three and six months ended June 30, 2020, respectively. The provision for income taxes for the three and six months ended June 30, 2021 is related to state income taxes. The benefit for income taxes for the three months ended June 30, 2020 is related to a decrease to the annual projections for federal and state income taxes. The provision for income taxes for the six months ended June 30, 2020 is related to federal income taxes, partially offset by a federal alternative minimum tax, or AMT, credit refund benefit and a federal benefit related to lease termination expense, plus state income taxes, including state valuation allowance. See Note 15 for more information regarding the impact of certain provisions of the CARES Act relating to income and other taxes. We previously determined it was more likely than not that a majority of our net deferred tax assets would not be realized and concluded that a valuation allowance was required, which eliminated the majority of our net deferred tax assets recorded in our condensed consolidated balance sheets. In the future, if we believe that we will more likely than not realize the benefit of these deferred tax assets, we will adjust our valuation allowance and recognize an income tax benefit, which may affect our results of operations.
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Net (Loss) Income Per Share |
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Net (Loss) Income Per Share | Net (Loss) Income Per Share Basic net (loss) income per share is calculated by dividing net (loss) income by the weighted average number of outstanding common shares outstanding during the period. When applicable, net (loss) income per share—diluted reflects the more dilutive earnings per share using the weighted average number of our common shares calculated using the two-class method, or the treasury stock method. The following table provides a reconciliation of the weighted average number of common shares used in the calculation of basic and diluted net (loss) income per share (in thousands):
_______________________________________ (1) For the three months ended June 30, 2021, 150 of our unvested common shares were not included in the calculation of net loss per share—diluted because to do so would have been anti-dilutive. For the six months ended June 30, 2021 and 2020, 141 and 123, respectively, of our unvested common shares were not included in the calculation of the net loss per share—diluted because to do so would have been antidilutive.
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Fair Values of Assets and Liabilities |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Values of Assets and Liabilities | Fair Values of Assets and Liabilities Recurring Fair Value Measures The tables below present certain of our assets measured at fair value at June 30, 2021 and December 31, 2020, categorized by the level of input used in the valuation of each asset.
_______________________________________ (1) Cash equivalents consist of short-term, highly liquid investments and money market funds held primarily for obligations arising from our self-insurance programs. Cash equivalents are reported in our condensed consolidated balance sheets as cash and cash equivalents and current and long-term restricted cash and cash equivalents. Cash equivalents include $22,536 and $22,837 of balances that were restricted at June 30, 2021 and December 31, 2020, respectively. In addition to the cash equivalents of $26,593 and $26,291 at June 30, 2021 and December 31, 2020, respectively, reflected above, there were cash balances of $95,213 and $80,897 and restricted cash balances of $2,405 and $2,409 at June 30, 2021 and December 31, 2020, respectively. (2) The fair value of our equity investments is readily determinable. During the six months ended June 30, 2021 and 2020, we received gross proceeds of $741 and $2,888, respectively, in connection with the sales of equity investments and recorded gross realized gains totaling $175 and $296, respectively, and gross realized losses totaling $0 and $214, respectively. (3) The investment strategy of this fund is to invest principally in fixed income securities. The fund invests in such securities or investment vehicles it considers appropriate to achieve the fund’s investment objective, which is to provide an above average rate of total return while attempting to limit investment risk by investing in a diversified portfolio of primarily fixed income securities issued by companies with below investment grade ratings. There are no unfunded commitments and the investment can be redeemed weekly. (4) The investment strategy of this fund is to invest principally in fixed income securities issued by non-U.S. issuers. The fund invests in such securities or investment vehicles as it considers appropriate to achieve the fund’s investment objective, which is to provide an above average rate of total return while attempting to limit investment risk by investing in a diversified portfolio of U.S. dollar investment-grade fixed income securities. There are no unfunded commitments and the investment can be redeemed weekly. (5) As of June 30, 2021, our debt investments, which are classified as available for sale, had a fair value of $10,554 with an amortized cost of $10,066; the difference between the fair value and amortized cost amounts resulted from unrealized gains of $488, net of unrealized losses of $18. As of December 31, 2020, our debt investments had a fair value of $12,310 with an amortized cost of $11,554; the difference between the fair value and amortized cost amounts resulted from unrealized gains of $756, net of unrealized losses of $4. Debt investments include $6,922 and $8,395 of balances that were restricted as of June 30, 2021 and December 31, 2020, respectively. At June 30, 2021, three debt investments we held, with a fair value of $512, had been in a loss position for less than 12 months and we did not hold any debt investments with a fair value in a loss position for greater than 12 months. We do not believe these investments are impaired primarily because they have not been in a loss position for an extended period of time, the financial conditions of the issuers of these investments remain strong with solid fundamentals as of June 30, 2021, we do not intend to sell the investments and it is not more likely than not that we will be required to sell the investments before recovery, and other factors that support our conclusion that the loss is temporary. During the six months ended June 30, 2021 and 2020, we received gross proceeds of $1,294 and $1,963, respectively, in connection with the sales of debt investments and recorded gross realized gains totaling $18 and $13, respectively. There were no gross realized losses for the six months ended June 30, 2021 and 2020, respectively. We record gains and losses on the sales of these investments using the specific identification method. The amortized cost basis and fair value of available for sale debt securities at June 30, 2021, by contractual maturity, are shown below.
Our financial assets (which include cash equivalents and investments) have been valued at the transaction price and subsequently valued, at the end of each reporting period, utilizing third-party pricing services or other market observable data. During the six months ended June 30, 2021, we did not change the type of inputs used to determine the fair value of any of our assets and liabilities that we measure at fair value. The carrying value of accounts receivable and accounts payable approximates fair value as of June 30, 2021 and December 31, 2020. The carrying value and fair value of our mortgage notes payable were $6,980 and $7,901, respectively, as of June 30, 2021 and $7,171 and $8,177, respectively, as of December 31, 2020, and are categorized in Level 3 of the fair value hierarchy. We estimate the fair value of our mortgage note payable by using discounted cash flow analyses and currently prevailing market terms as of the measurement date. Non-Recurring Fair Value Measures We review the carrying value of our long-lived assets, including our right-of-use assets, property and equipment and other intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying value of an asset or asset group may not be recoverable.
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Indebtedness |
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Indebtedness | Indebtedness Our $65,000 secured revolving credit facility, or Credit Facility, is governed by a credit agreement with a syndicate of lenders. The maturity date of our Credit Facility is June 12, 2022, which reflects our exercise in June 2021 of our option to extend the term of the Credit Facility. Our Credit Facility is available for general business purposes, including acquisitions, and provides for the issuance of letters of credit. We are required to pay interest at a rate of LIBOR plus a premium of 250 basis points per annum, or at a base rate, as defined in our Credit Agreement, plus 150 basis points per annum, on borrowings under our Credit Facility; the effective annual interest rate options, as of June 30, 2021, were 2.60% and 4.75%, respectively. We are also required to pay a quarterly commitment fee of 0.35% per annum on the unused portion of the available capacity under our Credit Facility. As of June 30, 2021 and 2020, we had no borrowings outstanding under our Credit Facility. As of June 30, 2021, we had letters of credit issued under the Credit Facility in an aggregate amount of $792 and we had $46,476 available for borrowings under our Credit Facility. We incurred aggregate interest expense related to our Credit Facility of $205 and $275 for the three months ended June 30, 2021 and 2020, respectively, and $458 and $539 for the six months ended June 30, 2021 and 2020, respectively. Our Credit Facility is secured by 11 senior living communities we own with a combined 1,236 living units owned by certain of our subsidiaries that guarantee our obligations under our Credit Facility. Our Credit Facility is also secured by these senior living communities' accounts receivable and related collateral. The amount of available borrowings under our Credit Facility is subject to our having sufficient qualified collateral, which is primarily based on the value and operating performance of the communities securing our obligations under our Credit Facility. Our Credit Facility provides for the acceleration of payment of all amounts outstanding under our Credit Facility upon the occurrence and continuation of certain events of default, including a change of control of us, as defined in our Credit Agreement. Our Credit Agreement contains financial and other covenants, including those that restrict our ability to pay dividends or make other distributions to our shareholders in certain circumstances. At June 30, 2021, we had six irrevocable standby letters of credit outstanding, totaling $27,642. One of these letters of credit in the amount of $26,850, which secures our workers' compensation insurance program, is collateralized by approximately $21,476 of cash equivalents and $5,637 of debt and equity investments. This letter of credit expires in June 2022 and is automatically extended for one-year terms unless notice of nonrenewal is provided prior to the end of the applicable term. At June 30, 2021, the cash equivalents collateralizing this letter of credit are classified as short-term restricted cash and cash equivalents in our condensed consolidated balance sheets, and the debt and equity investments collateralizing this letter of credit are classified as short-term restricted debt and equity investments in our condensed consolidated balance sheets. The remaining five irrevocable standby letters of credit outstanding at June 30, 2021, totaling $792, which are issued under the Credit Facility, secure certain of our other obligations. As of August 4, 2021, these letters of credit were scheduled to mature between September 2021 and June 2022 and are required to be renewed annually. At June 30, 2021, one of our senior living communities was encumbered by a mortgage note. This mortgage note contains standard mortgage covenants. We recorded a discount in connection with the assumption of this mortgage note as part of our acquisition of the senior living community secured by this mortgage in order to record this mortgage note at its then estimated fair value. We amortize this discount as an increase in interest expense until the maturity of this mortgage note. This mortgage note requires payments of principal and interest monthly until maturity. The following table is a summary of this mortgage note as of June 30, 2021:
_______________________________________ (1) Contractual principal payments excluding unamortized discount $215. We incurred interest expense, net of discount amortization, of $118 and $125 with respect to the mortgage note for the three months ended June 30, 2021 and 2020, respectively, and $240 and $253 for the six months ended June 30, 2021 and 2020, respectively. We believe we were in compliance with all applicable covenants under our Credit Facility and mortgage note as of June 30, 2021.
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Leases with DHC and Healthpeak Properties Inc. and Management Agreements with DHC |
6 Months Ended |
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Jun. 30, 2021 | |
Leases [Abstract] | |
Leases with DHC and Healthpeak Properties Inc. and Management Agreements with DHC | Leases with DHC and Healthpeak Properties Inc. and Management Agreements with DHC 2020 Restructuring of our Business Arrangements with DHC. Effective as of January 1, 2020: •our five then existing master leases with DHC as well as our then existing management and pooling agreements with DHC were terminated and replaced with new management agreements and a related omnibus agreement; •we issued 10,268,158 of our common shares to DHC and an aggregate of 16,118,849 of our common shares to DHC’s shareholders of record as of December 13, 2019; •as consideration for the share issuances, DHC provided to us $75,000 by assuming certain of our working capital liabilities and through cash payments; we recognized $22,899 in loss on termination of leases, representing the excess of the fair value of the share issuances of $97,899 compared to the consideration of $75,000 paid by DHC. As of March 31, 2020, DHC assumed $51,547 of our working capital liabilities. We received cash of $23,453 from DHC during the six months ended June 30, 2020; and •pursuant to a guaranty agreement dated as of January 1, 2020, made by us in favor of DHC’s applicable subsidiaries, we have guaranteed the payment and performance of each of our applicable subsidiary’s obligations under our applicable management agreements with DHC. We recognized transaction costs of $175 and $1,270 related to the 2020 restructuring of our business arrangements with DHC for the three and six months ended June 30, 2020, respectively. 2021 Amendments to our Management Arrangements with DHC. As part of the implementation of the Strategic Plan, on June 9, 2021, we amended our management arrangements with DHC. See Notes 1, 16 and 17 for additional information on the Strategic Plan. The principal changes to the management arrangements include: •we will cooperate with DHC in transitioning the management of 108 senior living communities with approximately 7,500 living units, to other third party managers without payment of any termination fee to us; •DHC will no longer have the right to sell up to an additional $682,000 of senior living communities managed by us and terminate our management of those communities without payment of a termination fee to us upon sale; •DHC's ability to terminate the management agreement was revised: (i) to not commence until 2025; (ii) the maximum amount of communities that may be terminated was reduced to 10% (from 20%) of the total managed portfolio by revenue per year; and (iii) achieving less than 80% (from 90%) of budgeted earnings before interest, taxes, and depreciation and amortization, or EBITDA, will be required to qualify as a “Non Performing Asset:” DHC will not be obligated to pay any termination fee to us if it exercises these termination rights; •we will continue to manage 120 senior living communities for DHC; •we will close and reposition the 27 skilled nursing units in CCRC communities that we will continue to manage with approximately 1,500 living units; •the incentive fee that we may earn in any calendar year for the senior living communities that we will continue to manage for DHC will no longer be subject to a cap and that any senior living communities that are undergoing a major renovation or repositioning will be excluded from the calculation of the incentive fee and the incentive fee calculation will be reset pursuant to the terms of the management agreements as a result of expected capital projects DHC is planning in the next five years; •The RMR Group LLC, or RMR LLC, assumed control of major community renovation or repositioning activities at the senior living communities that we will continue to manage for DHC; and •the term of our existing management agreements with DHC was extended by two years to December 31, 2036. We and DHC entered into an amended and restated master management agreement for the senior living communities that we will continue to manage for DHC and interim management agreements for the senior living communities that we and DHC agreed to transition to new operators. These agreements replaced our prior management and omnibus agreements with DHC. In addition, we delivered to DHC a related amended and restated guaranty agreement pursuant to which we will continue to guarantee the payment and performance of each of our applicable subsidiary's obligations under the applicable management agreements. As of June 30, 2021, none of the 108 senior living communities had been transitioned to new operators. In July 2021, DHC entered into agreements to transition 76 senior living communities with approximately 5,200 living units to new operators in 2021. We expect that (1) the transition of management of the 108 senior living communities, (2) the closure and repositioning of the remaining 59 SNF units that we had not yet closed as of June 30, 2021 and the repositioning of 1,473 closed SNF units and (3) the closure of the remaining ten Ageility inpatient clinics will be completed before year end 2021. For the three and six months ended June 30, 2021, we recognized $4,378 and $9,619, respectively, of management fees related to the management of these communities and units. See Note 17 for summary of progress made on the repositioning phase of the Strategic Plan in July 2021. Senior Living Communities Leased from Healthpeak Properties, Inc. As of June 30, 2021, we leased four senior living communities under one lease with PEAK. This lease is a “triple net” lease, which requires that we pay all costs incurred in the operation of the communities, including the cost of insurance and real estate taxes, maintaining the communities, and indemnifying the landlord for any liability which may arise from the operations during the lease term. We recognized rent expense for this lease for actual rent paid plus or minus a straight-line adjustment for scheduled minimum rent increases, which were not material to our condensed consolidated financial statements. The right-of-use asset balance has been decreased for the amount of accrued lease payments, which amounts are not material to our condensed consolidated financial statements. On March 8, 2021, we entered into a second amendment to our master lease with PEAK, pursuant to which we agreed to pay a lease termination fee upon the sale by PEAK of any of the four communities we lease in an amount equal to the difference between: (i) the net present value of the allocated minimum rate payments that would otherwise have been payable with respect to that community for the period beginning on the sale date and ending on April 30, 2023 (discounted at 9%) and (ii) the net present value of the reinvestment returns of the net proceeds from the sale of the community (discounted at 9%), and assuming such net proceeds are reinvested for the period commencing on the sale date and ending on April 30, 2023 at a rate of 5.5%. The aggregate maximum termination fee payable by us with respect to the termination of the four communities is capped at $3,100. On April 4, 2021, one of the communities that we lease from PEAK had a fire that caused extensive damage and the community has been out of service since that date. On June 3, 2021, we entered into an operations transfer agreement to assist with the transfer of the remaining three communities that we lease from PEAK to new operators, subject to regulatory and other approvals. These three communities have 152 living units and had senior living revenues of $1,508 and $3,009 for the three and six months ended June 30, 2021, respectively and lease expense of $546 and $1,085 for the three and six months ended June 30, 2021, respectively. Senior Living Communities Managed for the Account of DHC and its Related Entities. As of June 30, 2021 and 2020, we managed 228 and 241 senior living communities, respectively, for DHC. We earned management fees of $12,109 and $15,135 from the senior living communities we managed for the account of DHC for the three months ended June 30, 2021 and 2020, respectively, and $25,019 and $31,597 for the six months ended June 30, 2021 and 2020, respectively. In addition, we earned fees for our management of capital expenditure projects at the communities we managed for the account of DHC of $715 and $444 for the three months ended June 30, 2021 and 2020, respectively, and $1,549 and $906 for the six months ended June 30, 2021 and 2020, respectively. These amounts are included in management fee revenue in our condensed consolidated statements of operations. We also provide ancillary services to residents at some of the senior living communities we manage for the account of DHC, such as rehabilitation and wellness services. At senior living communities we manage for the account of DHC where we provide rehabilitation and wellness services on an outpatient basis, the residents, third party payers or government programs pay us for those rehabilitation and wellness services. At senior living communities we manage for the account of DHC where we provide inpatient rehabilitation and wellness services, DHC generally pays us for these services and charges for such services are included in amounts charged to residents, third party payers or government programs. We earned revenues of $2,630 and $5,814 for the three months ended June 30, 2021 and 2020, respectively, and $8,071 and $13,871 for the six months ended June 30, 2021 and 2020, respectively, for rehabilitation and wellness services we provided at senior living communities we manage for the account of DHC and that are payable by DHC. These amounts are included in rehabilitation and wellness services in our condensed consolidated statements of operations. We earned management fees of $103 and $126 for the three months ended June 30, 2021 and 2020, respectively, $209 and $253 for the six months ended June 30, 2021 and 2020, respectively, for management services at a part of a senior living community DHC subleases to an affiliate, which amounts are included in management fee revenues in our condensed consolidated statements of operations. In 2020, DHC sold nine senior living communities that we previously managed. Upon completion of these sales, our management agreements with DHC with respect to those communities were terminated. In addition, in 2020, DHC also closed seven additional senior living communities and closed one building in one senior living community. While those closed communities and building are no longer being operated as senior living communities, we continue to manage the related back-office operations for the empty communities. For the three and six months ended June 30, 2020, we recognized $664 and $1,716 of management fees related to these communities. In the three months ended June 30, 2021, we closed 1,473 SNF units and are in the process of repositioning them. We will continue to manage the repositioned units for DHC. For the three months ended June 30, 2021 and 2020, we recognized $458 and $1,364 of management fee revenue related to these closed SNF units, respectively. For the six months ended June 30, 2021 and 2020, we recognized $1,759 and $3,069 of management fee revenue related to these closed SNF units, respectively. Ageility Clinics Leased from DHC. We lease space from DHC at certain of the senior living communities that we manage for DHC. We use this leased space for outpatient rehabilitation and wellness services clinics. We recognized rent expense of $398 and $488 for the three months ended June 30, 2021 and 2020, respectively, and $795 and $782 for the six months ended June 30, 2021 and 2020, respectively, with respect to these leases.
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Business Management Agreement with RMR LLC |
6 Months Ended |
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Jun. 30, 2021 | |
Management Agreement [Abstract] | |
Business Management Agreement with RMR LLC | Business Management Agreement with RMR LLC RMR LLC, provides business management services to us pursuant to our business management and shared services agreement. We incurred aggregate fees and certain cost reimbursements payable to RMR LLC of $1,795 and $2,123 for the three months ended June 30, 2021 and 2020, respectively, and $3,599 and $4,474 for the six months ended June 30, 2021 and 2020, respectively. These amounts are included in general and administrative expenses in our condensed consolidated statements of operations. For further information about our relationship with RMR LLC, see our Annual Report.
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Related Person Transactions |
6 Months Ended |
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Jun. 30, 2021 | |
Related Party Transactions [Abstract] | |
Related Person Transactions | Related Person Transactions We have relationships and historical and continuing transactions with DHC, RMR LLC and others related to them, including other companies to which RMR LLC or its subsidiaries provide management services and some of which have trustees, directors and officers who are also our Directors or officers. The RMR Group Inc., or RMR Inc., is the managing member of RMR LLC. The Chair of our Board and one of our Managing Directors, Adam D. Portnoy, is the sole trustee, an officer and the controlling shareholder of ABP Trust, which is the controlling shareholder of RMR Inc. Mr. Portnoy is also a managing director and the president and chief executive officer of RMR Inc. and an officer and employee of RMR LLC. Jennifer B. Clark, our other Managing Director and our Secretary, also serves as a managing director and the executive vice president, general counsel and secretary of RMR Inc., an officer and employee of RMR LLC and an officer of ABP Trust. Certain of our officers, and DHC’s officers, are also officers and employees of RMR LLC. Some of our Independent Directors also serve as independent trustees or independent directors of other public companies to which RMR LLC or its subsidiaries provide management services. Adam Portnoy serves as the chair of the boards of trustees or boards of directors of several of these public companies and as a managing director or managing trustee of these companies. Other officers of RMR LLC, including Ms. Clark, serve as managing trustees or managing directors of certain of these companies. DHC. DHC is currently our largest shareholder, owning, as of June 30, 2021, 10,691,658 of our common shares, or 33.7% of our outstanding common shares. We manage for the account of DHC a substantial majority of the senior living communities we operate. Adam Portnoy is chair of the board of trustees and a managing trustee of DHC. Jennifer Clark is a former managing trustee and the secretary of DHC. Included in accrued expenses and other current liabilities on our condensed consolidated balance sheets at June 30, 2021 and December 31, 2020 are $19,570 and $30,090, respectively, of expenses we incurred in connection with the senior living communities we manage for DHC. DHC will reimburse us those amounts, and we have included those amounts in due from related person. See Note 11 for more information regarding our relationships, agreements and transactions with DHC and certain parties related to it and us. RMR LLC. We have an agreement with RMR LLC for RMR LLC to provide business management services to us. See Note 12 for more information regarding our relationship with RMR LLC. ABP Trust. ABP Trust and its subsidiaries owned 1,972,783 of our common shares, representing 6.2% of our outstanding common shares, as of June 30, 2021. We lease our headquarters from a subsidiary of ABP Trust. On February 24, 2021, we and the ABP Trust subsidiary renewed the lease through December 31, 2031. The annual lease payment will range from $1,026 to $1,395 over the period of the lease. The lease also provides us with an improvements allowance from ABP Trust not to exceed $2,667. Our rent expense for our headquarters, including utilities and real estate taxes that we pay as additional rent, was $559 and $424 for the three months ended June 30, 2021 and 2020, respectively, and $1,036 and $859 for the six months ended June 30, 2021 and 2020, which is included in general and administrative expenses. As a result of renewing this lease, we increased each of our right-of-use asset and lease liability noted below on our condensed consolidated balance sheets by $9,746 to reflect the terms of the amendment. We recognized a right-of-use asset and lease liability, which amounts were $9,872 and $496 for the lease liability and $9,708 and $452 for the right-of-use asset as of June 30, 2021 and December 31, 2020, respectively, with respect to our headquarters lease, using an incremental borrowing rate of 3.9%. The right-of-use asset has been reduced by the amount of accrued lease payments, which amounts are not material to our condensed consolidated financial statements. For further information about these and other such relationships and certain other related person transactions, see our Annual Report.
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Commitments and Contingencies |
6 Months Ended |
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Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We have been, are currently, and expect in the future to be involved in claims, lawsuits, and regulatory and other government audits, investigations and proceedings arising in the ordinary course of our business, some of which may involve material amounts. Also, the defense and resolution of these claims, lawsuits, and regulatory and other government audits, investigations and proceedings may require us to incur significant expense. Loss contingency provisions are recorded for probable and estimable losses at our best estimate of a loss or, when a best estimate cannot be made, at our estimate of the minimum loss. These estimates are often developed prior to knowing the amount of the ultimate loss, require the application of considerable judgment and are refined as additional information becomes known. Accordingly, we are often initially unable to develop a best estimate of loss and therefore the estimated minimum loss amount, which could be zero, is recorded; then, as information becomes known, the minimum loss amount is updated, as appropriate. We were defendants in two lawsuits filed by former employees in California. The first lawsuit, Lefevre v. Five Star Quality Care, Inc. was filed in San Bernardino County Superior Court in May 2015 and the second lawsuit, Mandviwala v. Five Star Quality Care, Inc. d/b/a Five Star Quality Care - CA, Inc. and FVE Managers, Inc., our wholly owned subsidiary, was filed in Orange County Superior Court in July 2015. The claims asserted against us in the similar, though not identical, complaints included: (i) failure to pay all wages due, (ii) failure to pay overtime, (iii) failure to provide meal and rest breaks, (iv) failure to provide itemized, printed wage statements, (v) failure to keep accurate payroll records and (vi) failure to reimburse business expenses. Both plaintiffs asserted causes of action on behalf of themselves and on behalf of other similarly situated employees, including causes of action pursuant to the California Labor Code Private Attorney General Act, or PAGA. On July 10, 2020, the parties in Lefevre v. Five Star Quality Care, Inc., agreed, without admitting fault, to settle Ms. Lefevre's individual and PAGA claims. The settlement was approved by the court and final judgement on the settlement has been entered. The settlement amount was $3,062, of which $2,400 was allocated to us and $662 was allocated to DHC. The total settlement amount was paid on May 12, 2021. The settlement extinguished the Mandviwala v. Five Star Quality Care, Inc. d/b/a Five Star Quality Care - CA, Inc. and FVE Managers, Inc. lawsuit. We recognized our allocated amount for the settlement as an expense in our condensed consolidated statements of operations during the second quarter of 2020.
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COVID-19 Pandemic |
6 Months Ended |
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Jun. 30, 2021 | |
Unusual or Infrequent Items, or Both [Abstract] | |
COVID-19 Pandemic | COVID-19 Pandemic On March 11, 2020, the World Health Organization declared the disease caused by the novel coronavirus SARS-CoV-2, or COVID-19, a pandemic, or the Pandemic. The global spread of COVID-19 caused economic disruption worldwide, and although conditions have significantly improved in the United States since the low points experienced, significant uncertainty regarding the Pandemic's ultimate duration, severity and near and long term impacts remain. Governments in affected regions have implemented and may continue to implement, safety precautions, including quarantines, travel restrictions, business closures and other public safety measures. On March 13, 2020, the President of the United States declared the Pandemic a national emergency, effective as of March 1, 2020, or the National Emergency. The National Emergency remains in effect. The Pandemic has significantly disrupted, and it and its aftermath will likely continue to disrupt, our business and the senior living industry as a whole. We cannot predict whether the relief provided by the CARES Act together with any additional funds under the other Provider Relief Fund or other programs that we may receive will be sufficient to offset the financial impact related to the decrease in average occupancy levels and increased PPE costs since the first quarter of 2020. caused by the Pandemic, but to date, they have not been and we expect they will not be. During the Pandemic, we have experienced occupancy declines, increased labor costs and increased costs related to COVID-19 testing, medical and sanitation supplies and certain other costs. Additionally, we have purchased personal protective equipment, or PPE, to be used at our senior living communities and rehabilitation and wellness clinics. At June 30, 2021, $6,535 of PPE for future use was included in prepaid expenses and other current assets in our condensed consolidated balance sheets. PPE that is deployed to senior living communities that we manage on behalf of DHC is reimbursable to us by DHC. For the three and six months ended June 30, 2021, we deployed $2,205 and $3,057, respectively, of PPE to senior living communities that we manage on behalf of DHC. In response to the Pandemic, the CARES Act was enacted on March 27, 2020. The CARES Act, among other things, provides billions of dollars of relief to certain individuals and businesses suffering from the impact of the Pandemic. Under the CARES Act, a Provider Relief Fund was established for allocation by HHS and was further supplemented by the Consolidated Appropriations Act, 2021 on December 27, 2020. The terms and conditions of the Provider Relief Fund require that the funds are utilized to compensate for lost revenues that are attributable to the Pandemic and for eligible costs to prevent, prepare for and respond to the Pandemic that are not covered by other sources. In addition Provider Relief Funds recipients are subject to other terms and conditions, including certain reporting requirements. Any funds not used in accordance with the terms and conditions must be returned to HHS. On April 10, 2020, HHS began to distribute these funds, or the Phase 1 General Distribution, to healthcare providers who received Medicare fee-for-service reimbursement in 2018 and 2019. Each healthcare provider's allocation of the Phase 1 General Distribution was determined based on 2% of a provider's 2018 (or most recent complete tax year) gross receipts, regardless of the provider's payer mix. On June 9, 2020, HHS announced additional distributions from the Provider Relief Fund, or Phase 2 General Distribution, including the Medicaid and Children's Health Insurance Program, or the Medicaid and CHIP Targeted Distribution. HHS stated that it would disburse a payment that, at a minimum, is equal to 2% of reported total revenue from patient care to eligible providers serving Medicaid and CHIP beneficiaries. Providers who had not yet received a disbursement from the Phase 1 General Distribution were eligible for the Medicaid and CHIP Targeted Distribution. Information on future allocations of the Provider Relief Fund are not yet known, though the statute requires that no less than 85% of unobligated balances of the fund and funds recovered from providers after the enactment date be allocated based on financial losses and changes in operating expenses occurring in the third or fourth quarter of calendar year 2020. We recognized other operating income of $2 and $1,499 for the three months ended June 30, 2021 and 2020, respectively, and $7,795 and $1,499 for the six months ended June 30, 2021 and 2020, respectively, related to General Distribution Funds primarily for our senior living communities for which we believe we have met the required terms and conditions. The CARES Act delays the payment of required federal tax deposits for certain payroll taxes, including the employer's share of Old-Age, Survivors, and Disability Insurance Tax, or Social Security, employment taxes, incurred between March 27, 2020 and December 31, 2020. Amounts will be considered timely paid if 50% of the deferred amount is paid by December 31, 2021, and the remainder by December 31, 2022. As of June 30, 2021 and December 31, 2020, we deferred $27,593 of employer payroll taxes, which are included in accrued compensation and benefits in our condensed consolidated balance sheets, of which $22,194 will be reimbursable to us by DHC pursuant to the management agreements and are included in due from related persons in our condensed consolidated balance sheets. The Sequestration Transparency Act of 2012 subjected all Medicare fee-for-service payments to a 2% sequestration reduction, or the 2% Medicare Sequestration. The CARES Act temporarily suspended the 2% Medicare Sequestration for the period from May 1, 2020 to March 31, 2021 which benefited our rehabilitation and wellness services segment and the senior living communities we manage in the form of increased rates for services provided and the management fees we earn from these communities as a result. Increases in rates are recognized in revenue in the period services are provided. On April 14, 2021, President Biden signed into law legislation that further extended the temporary suspension of the 2% Medicare Sequestration until December 31, 2021. The Tax Cuts and Jobs Act of 2017 repealed the AMT and allowed corporations to fully offset regular tax liability with AMT credits. Any remaining AMT credit amount became refundable incrementally from tax years 2018 through 2021. The CARES Act accelerates the refund schedule, permitting corporate taxpayers to claim the refund in full in either tax year 2018 or 2019. We expect to apply an AMT credit refund of $554 for tax year 2019 to our 2021 tax return, as we do not have a federal tax liability to utilize the refund against our the 2020 tax return.
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Restructuring Expense |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Expense | Restructuring Expense On April 9, 2021, we announced, as part of the Strategic Plan, the repositioning of the Company's senior living management business to focus on larger independent living, assisted living and memory care communities as well as stand-alone independent living and active adult communities. We expect these transition activities to be completed prior to December 31, 2021. See Notes 1, 11 and 17 for more information on the Strategic Plan and our business arrangements with DHC. During the three months ended June 30, 2021, the following actions were taken pursuant to the repositioning phase of the Strategic Plan, we: •Amended our management arrangements with DHC on June 9, 2021. See Note 11 for additional information regarding the amendments to the management arrangements with DHC, •Closed 1,473 of the approximately 1,500 SNF living units planned for closure in 26 of the 27 CCRCs, •Closed 27 of the planned 37 Ageility inpatient rehabilitation clinics, •Recognized severance and retention costs of $14,544, and •Incurred other costs in connection with the closure of communities and units of $845 A summary of the liabilities incurred combined with a reconciliation of the related components of the Strategic Plan restructuring expense recognized in the three and six months ended June 30, 2021, follows, first by cost component and then by segment, the expenses are aggregated and reported in the line item Restructuring expenses in our condensed consolidated statements of operations:
_______________________________________ (1) No obligations related to the Strategic Plan were incurred in 2020. Accrued bonuses and other compensation are reported in the condensed consolidated balance sheet as part of Accrued compensation and benefits and accrued transaction expenses are reported as part of Accrued expenses and other current liabilities in the condensed consolidated balance sheet.
_______________________________________ (1) No obligations related to the Strategic Plan were incurred in 2020. Accrued bonuses and other compensation are reported in the condensed consolidated balance sheet as part of Accrued compensation and benefits and accrued transaction expenses are reported as part of Accrued expenses and other current liabilities in the condensed consolidated balance sheet. In addition to the restructuring expenses recorded for the three months ended June 30, 2021, there were transaction expenses of $250 recorded in corporate and other in the three months ended March 31, 2021. In connection with the implementation of the repositioning of other senior living management services, we expect to incur restructuring obligations, recognized under ASC 420, Exit or Disposal Cost Obligations and ASC 712, Compensation — Nonretirement Postemployment Benefits - special termination benefits, of up to $20,500, approximately $15,000 of which we expect DHC will reimburse. These expenses are expected to include up to $7,500 of retention bonus payments, up to $10,200 of severance, benefits and transition expenses, and up to $2,800 of transaction expenses, of which we expect DHC to reimburse approximately $5,900, $7,500 and $1,600, respectively. For the three and six months ended June 30, 2021, we recorded expenses of $15,389 and $15,639, respectively, $11,531 of which we expect to be reimbursed by DHC which is recorded in other reimbursed expenses for both the three and six months ended June 30, 2021. See Notes 1, 11 and 17 for more information on the Strategic Plan and our business arrangements with DHC.
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Subsequent Events |
6 Months Ended |
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Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsIn July 2021 we continued to make progress on the Strategic Plan as we transitioned 26 senior living communities (with approximately 1,500 living units) to new operators. In addition, DHC entered into agreements to transition the management of an additional 50 senior living communities (approximately 3,700 living units) to new operators. |
Summary of Significant Accounting Policies (Policies) |
6 Months Ended |
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Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Estimates and Assumptions | Estimates and Assumptions. The preparation of these financial statements in conformity with GAAP requires us to make estimates and assumptions that may affect the amounts reported in these condensed consolidated financial statements and related notes. Significant estimates in our condensed consolidated financial statements relate to revenue recognition, including contractual allowances, the allowance for doubtful accounts, self-insurance reserves and estimates concerning our provision for income taxes or valuation allowance related to deferred tax assets. Our actual results could differ from our estimates. We periodically review estimates and assumptions and we reflect the effects of changes, if any, in the condensed consolidated financial statements in the period that they are determined.
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Accounting for Costs Associated with Exit or Disposal Activities | Accounting for Costs Associated with Exit or Disposal Activities. A liability for costs associated with exit or disposal activities other than in a business combination, is recognized when the liability is incurred. The liability, recognized under ASC 420, Exit or Disposal Cost Obligations and ASC 712, Compensation — Nonretirement Postemployment - special termination benefits, is measured at fair value, with adjustments for changes in estimated cash flows recognized in earnings. During the three months ended June 30, 2021 costs were incurred related to the Strategic Plan |
Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Issued Accounting Pronouncements Not Yet Adopted. In June 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, No. 2016-13, Financial Instruments-Credit Losses (Topic 326), which requires a financial asset or a group of financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. This ASU eliminates the probable initial recognition threshold and instead requires reflection of an entity’s current estimate of all expected credit losses. In addition, this ASU amends the current other-than-temporary impairment model for available for sale debt securities. The length of time that the fair value of an available for sale debt security has been below the amortized cost will no longer impact the determination of whether a credit loss exists and credit losses will now be limited to the difference between a security’s amortized cost basis and its fair value. In November 2018, the FASB issued ASU No. 2018-19, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, which amends the transition and effective date for nonpublic entities and smaller reporting companies, such as us, and clarifies that receivables arising from operating leases are not in the scope of this ASU. In November 2019, the FASB issued ASU No. 2019-11, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, which clarifies guidance around how to report expected recoveries. Entities will apply the provisions of the ASU as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. This ASU is effective for smaller reporting companies for reporting periods beginning after December 15, 2022. We are assessing the potential impact that the adoption of this ASU (and the related clarifying guidance issued by the FASB) will have on our condensed consolidated financial statements. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides temporary optional expedients and exceptions on contract modifications meeting certain criteria to ease the financial reporting burdens of the expected market transition from the London Inter-bank Offered Rate, or LIBOR, and other interbank offered rates to the alternative reference rates. For a contract that meets the criteria, this ASU generally allows an entity to account for and present modifications as an event that does not require remeasurement at the modification date or reassessment of a previous accounting determination. This ASU was effective upon issuance and can be applied through December 31, 2022. We expect this ASU will not have a material impact on our condensed consolidated financial statements.
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Revenue and Other Operating Income (Tables) |
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Schedule of Disaggregation of Revenue | The following tables present revenue from contracts by segment with customers disaggregated by type of payer, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors:
_______________________________________ (1) Represents separate revenue streams earned from DHC; see Note 4 for discussion of Segment Information. (2) (i) We intend to transition 108 senior living communities managed on behalf of DHC with approximately 7,500 living units to new operators in 2021 and (ii) we closed 1,473 SNF units in 26 CCRCs in the three months ended June 30, 2021 and are in the process of repositioning them and expect to close and reposition an additional 59 SNF units in one CCRC during the remainder of 2021 that we will continue to manage for DHC. The management fees we recognized related to these communities and units for the three months ended June 30, 2021 was $4,378. See Notes 1, 11, 16 and 17 for more information. (3) 27 Ageility inpatient rehabilitation clinics were closed in the three months ended June 30, 2021 and we expect to close an additional ten Ageility inpatient rehabilitation clinics during the remainder of 2021. Revenue related to these clinics for the three months ended June 30, 2021 was $2,630. See Notes 1, 16 and 17 for more information. (4) Includes $11,531 of restructuring expenses to be reimbursed by DHC for the three months ended June 30, 2021.
_______________________________________ (1) Represents separate revenue streams earned from DHC.
_______________________________________ (1) Represents separate revenue streams earned from DHC; see Note 4 for discussion of Segment Information. (2) (i) We intend to transition 108 senior living communities managed on behalf of DHC with approximately 7,500 living units to new operators in 2021 and (ii) we closed 1,473 SNF units in 26 CCRCs in the six months ended June 30, 2021 and are in the process of repositioning them and expect to close and reposition an additional 59 SNF units in one CCRC during the remainder of 2021 that we will continue to manage for DHC. The management fees we recognized related to these communities and units for the six months ended June 30, 2021 was $9,619. See Notes 1, 11, 16 and 17 for more information. (3) 27 Ageility inpatient rehabilitation clinics were closed in the six months ended June 30, 2021 and we expect to close an additional ten Ageility inpatient rehabilitation clinics during the remainder of 2021. Revenue related to these clinics for the six months ended June 30, 2021 was $8,071. See Notes 1, 16 and 17 for more information. (4) Includes $11,531 of restructuring expenses to be reimbursed by DHC for the six months ended June 30, 2021.
_______________________________________ (1) Represents separate revenue streams earned from DHC.
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Segment Information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Information | Results of operations and selected financial information by reportable segment and the reconciliation to the condensed consolidated financial statements are as follows:
_______________________________________ (1) (i) We intend to transition 108 senior living communities managed on behalf of DHC with approximately 7,500 living units to new operators in 2021 and (ii) we closed 1,473 SNF units in 26 CCRCs in the three months ended June 30, 2021 and are in the process of repositioning them and expect to close and reposition an additional 59 SNF units in one CCRC during the remainder of 2021 that we will continue to manage for DHC. See Notes 1, 11, 16 and 17 for more information. As more fully described in Note 16, the senior living segment recognized $11,531 of restructuring expenses related to the Strategic Plan and $11,531 of other reimbursed expenses in the three months ended June 30, 2021. (2) 27 Ageility inpatient rehabilitation clinics were closed in the three months ended June 30, 2021 and we expect to close an additional ten Ageility inpatient rehabilitation clinics during the remainder of 2021. See Notes 1, 16 and 17 for more information. As more fully described in Note 16, the rehabilitation and wellness services segment recognized $1,720 of restructuring expenses related to the Strategic Plan in the three months ended June 30, 2021. (3) As more fully described in Note 16, Corporate and Other recognized $2,138 of restructuring expenses related to the Strategic Plan in the three months ended June 30, 2021.
_______________________________________ (1) (i) We intend to transition 108 senior living communities managed on behalf of DHC with approximately 7,500 living units to new operators in 2021 and (ii) we closed 1,473 SNF units in 26 CCRCs in the six months ended June 30, 2021 and are in the process of repositioning them and expect to close and reposition an additional 59 SNF units in one CCRC during the remainder of 2021 that we will continue to manage for DHC. See Notes 1, 11, 16 and 17 for more information. As more fully described in Note 16, the senior living segment recognized $11,531 of restructuring expenses related to the Strategic Plan and $11,531 of other reimbursed expenses in the six months ended June 30, 2021. (2) 27 Ageility inpatient rehabilitation clinics were closed in the six months ended June 30, 2021 and we expect to close an additional ten Ageility inpatient rehabilitation clinics during the remainder of 2021. See Notes 1, 16 and 17 for more information. As more fully described in Note 16, the rehabilitation and wellness services segment recognized $1,720 of restructuring expenses related to the Strategic Plan in the six months ended June 30, 2021. (3) As more fully described in Note 16, Corporate and Other recognized $2,388 of restructuring expenses related to the Strategic Plan in the six months ended June 30, 2021.
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Property and Equipment, net (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property and Equipment, Net | Property and equipment, net consist of the following:
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Accumulated Other Comprehensive Income (Tables) |
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Jun. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Changes in Accumulated Other Comprehensive Income, Net of Tax | The following tables detail the changes in accumulated other comprehensive income (loss), net of tax, for the six months ended June 30, 2021 and 2020:
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Net (Loss) Income Per Share (Tables) |
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Weighted Average Number of Shares | The following table provides a reconciliation of the weighted average number of common shares used in the calculation of basic and diluted net (loss) income per share (in thousands):
_______________________________________ (1) For the three months ended June 30, 2021, 150 of our unvested common shares were not included in the calculation of net loss per share—diluted because to do so would have been anti-dilutive. For the six months ended June 30, 2021 and 2020, 141 and 123, respectively, of our unvested common shares were not included in the calculation of the net loss per share—diluted because to do so would have been antidilutive.
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Fair Values of Assets and Liabilities (Tables) |
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring and Non Recurring Basis, Categorized by the Level of Inputs Used in the Valuation of Each Asset | The tables below present certain of our assets measured at fair value at June 30, 2021 and December 31, 2020, categorized by the level of input used in the valuation of each asset.
_______________________________________ (1) Cash equivalents consist of short-term, highly liquid investments and money market funds held primarily for obligations arising from our self-insurance programs. Cash equivalents are reported in our condensed consolidated balance sheets as cash and cash equivalents and current and long-term restricted cash and cash equivalents. Cash equivalents include $22,536 and $22,837 of balances that were restricted at June 30, 2021 and December 31, 2020, respectively. In addition to the cash equivalents of $26,593 and $26,291 at June 30, 2021 and December 31, 2020, respectively, reflected above, there were cash balances of $95,213 and $80,897 and restricted cash balances of $2,405 and $2,409 at June 30, 2021 and December 31, 2020, respectively. (2) The fair value of our equity investments is readily determinable. During the six months ended June 30, 2021 and 2020, we received gross proceeds of $741 and $2,888, respectively, in connection with the sales of equity investments and recorded gross realized gains totaling $175 and $296, respectively, and gross realized losses totaling $0 and $214, respectively. (3) The investment strategy of this fund is to invest principally in fixed income securities. The fund invests in such securities or investment vehicles it considers appropriate to achieve the fund’s investment objective, which is to provide an above average rate of total return while attempting to limit investment risk by investing in a diversified portfolio of primarily fixed income securities issued by companies with below investment grade ratings. There are no unfunded commitments and the investment can be redeemed weekly. (4) The investment strategy of this fund is to invest principally in fixed income securities issued by non-U.S. issuers. The fund invests in such securities or investment vehicles as it considers appropriate to achieve the fund’s investment objective, which is to provide an above average rate of total return while attempting to limit investment risk by investing in a diversified portfolio of U.S. dollar investment-grade fixed income securities. There are no unfunded commitments and the investment can be redeemed weekly. (5) As of June 30, 2021, our debt investments, which are classified as available for sale, had a fair value of $10,554 with an amortized cost of $10,066; the difference between the fair value and amortized cost amounts resulted from unrealized gains of $488, net of unrealized losses of $18. As of December 31, 2020, our debt investments had a fair value of $12,310 with an amortized cost of $11,554; the difference between the fair value and amortized cost amounts resulted from unrealized gains of $756, net of unrealized losses of $4. Debt investments include $6,922 and $8,395 of balances that were restricted as of June 30, 2021 and December 31, 2020, respectively. At June 30, 2021, three debt investments we held, with a fair value of $512, had been in a loss position for less than 12 months and we did not hold any debt investments with a fair value in a loss position for greater than 12 months. We do not believe these investments are impaired primarily because they have not been in a loss position for an extended period of time, the financial conditions of the issuers of these investments remain strong with solid fundamentals as of June 30, 2021, we do not intend to sell the investments and it is not more likely than not that we will be required to sell the investments before recovery, and other factors that support our conclusion that the loss is temporary. During the six months ended June 30, 2021 and 2020, we received gross proceeds of $1,294 and $1,963, respectively, in connection with the sales of debt investments and recorded gross realized gains totaling $18 and $13, respectively. There were no gross realized losses for the six months ended June 30, 2021 and 2020, respectively. We record gains and losses on the sales of these investments using the specific identification method.
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Schedule of Debt Securities | The amortized cost basis and fair value of available for sale debt securities at June 30, 2021, by contractual maturity, are shown below.
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Indebtedness (Tables) |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Mortgages | The following table is a summary of this mortgage note as of June 30, 2021:
_______________________________________ (1) Contractual principal payments excluding unamortized discount $215.
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Restructuring Expense (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Liabilities and Expenses Related to Strategic Plan | A summary of the liabilities incurred combined with a reconciliation of the related components of the Strategic Plan restructuring expense recognized in the three and six months ended June 30, 2021, follows, first by cost component and then by segment, the expenses are aggregated and reported in the line item Restructuring expenses in our condensed consolidated statements of operations:
_______________________________________ (1) No obligations related to the Strategic Plan were incurred in 2020. Accrued bonuses and other compensation are reported in the condensed consolidated balance sheet as part of Accrued compensation and benefits and accrued transaction expenses are reported as part of Accrued expenses and other current liabilities in the condensed consolidated balance sheet.
_______________________________________ (1) No obligations related to the Strategic Plan were incurred in 2020. Accrued bonuses and other compensation are reported in the condensed consolidated balance sheet as part of Accrued compensation and benefits and accrued transaction expenses are reported as part of Accrued expenses and other current liabilities in the condensed consolidated balance sheet.
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Property and Equipment, net (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
Dec. 31, 2020 |
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Property, Plant and Equipment [Line Items] | |||||
Property and equipment, at cost | $ 279,322 | $ 279,322 | $ 275,547 | ||
Less: accumulated depreciation | (121,686) | (121,686) | (116,296) | ||
Property and equipment, net | 157,636 | 157,636 | 159,251 | ||
Depreciation expenses | 2,699 | $ 2,703 | 5,390 | $ 5,404 | |
Land | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, at cost | 12,155 | 12,155 | 12,155 | ||
Buildings, construction in process and improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, at cost | 204,212 | 204,212 | 202,679 | ||
Long lived asset impairment charges | 890 | 890 | |||
Furniture, fixtures and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, at cost | 62,955 | 62,955 | $ 60,713 | ||
Long lived asset impairment charges | $ 890 | $ 890 |
Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
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Income Tax Disclosure [Abstract] | ||||
(Provision) benefit for income taxes | $ (158) | $ 902 | $ (358) | $ (506) |
Net (Loss) Income Per Share (Details) - shares shares in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
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Earnings Per Share [Abstract] | ||||
Weighted average shares outstanding—basic (in shares) | 31,552 | 31,460 | 31,541 | 31,454 |
Effect of dilutive securities: unvested share awards (in shares) | 0 | 122 | 0 | 0 |
Weighted average shares outstanding—diluted (in shares) | 31,552 | 31,582 | 31,541 | 31,454 |
Potentially dilutive restricted unvested common shares, not included in diluted EPS calculation (in shares) | 150 | 141 | 123 |
Fair Values of Assets and Liabilities - Debt Securities, Contractual Maturities (Details) - USD ($) $ in Thousands |
Jun. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Amortized Cost | ||
Due in one year or less | $ 1,270 | |
Due after one year through five years | 4,671 | |
Due after five years through ten years | 4,125 | |
Total | 10,066 | $ 11,554 |
Fair Value | ||
Due in one year or less | 1,292 | |
Due after one year through five years | 4,896 | |
Due after five years through ten years | 4,366 | |
Total | $ 10,554 | $ 12,310 |
Indebtedness - Payments of Principal and Interest (Details) - September 2032 $ in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2021
USD ($)
| |
Debt Instrument [Line Items] | |
Unamortized discount and debt issuance costs | $ 215 |
Mortgage Notes | |
Debt Instrument [Line Items] | |
Debt outstanding | $ 7,195 |
Contractual Stated Interest Rate | 6.20% |
Effective Interest Rate | 6.70% |
Monthly Payment | $ 72 |
Business Management Agreement with RMR LLC - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
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Reit Management And Research LLC | ||||
Business Management Agreement [Line Items] | ||||
Business management fees and costs | $ 1,795 | $ 2,123 | $ 3,599 | $ 4,474 |
Commitments and Contingencies (Details) |
May 12, 2021
USD ($)
|
Jun. 30, 2021
USD ($)
lawsuit
|
---|---|---|
Loss Contingencies [Line Items] | ||
Litigation settlement expense | $ 3,062,000 | |
Office of the Inspector General | ||
Loss Contingencies [Line Items] | ||
Estimated minimum loss | $ 0 | |
Lefevre v. Five Star Quality Care, Inc. | ||
Loss Contingencies [Line Items] | ||
Number of lawsuits | lawsuit | 2 | |
Litigation settlement expense | 2,400,000 | |
DHC | Lefevre v. Five Star Quality Care, Inc. | ||
Loss Contingencies [Line Items] | ||
Litigation settlement expense | $ 662,000 |
COVID-19 Pandemic - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
Dec. 31, 2020 |
|
Unusual or Infrequent Item, or Both [Line Items] | |||||
Other operating income | $ 2 | $ 1,499 | $ 7,795 | $ 1,499 | |
COVID-19 | |||||
Unusual or Infrequent Item, or Both [Line Items] | |||||
Payments for protective equipment | 6,535 | ||||
Deferred payroll taxes | 27,593 | 27,593 | $ 27,593 | ||
Payment of deferred taxes | 22,194 | ||||
AMT amount | 554 | 554 | |||
COVID-19 | Senior living | |||||
Unusual or Infrequent Item, or Both [Line Items] | |||||
Payments for protective equipment | $ 2,205 | $ 3,057 |
Subsequent Events (Details) - Subsequent Event - Senior Living Communities - Strategic Plan |
Jul. 31, 2021
community
living_unit
|
---|---|
Subsequent Event [Line Items] | |
Number of real estate properties transitioned | community | 26 |
Number of units in real estate property transitioned | 1,500 |
Diversified Healthcare Trust | |
Subsequent Event [Line Items] | |
Number of real estate properties transitioned | 50 |
Number of units in real estate property transitioned | 3,700 |
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