Segment Information

12 Months Ended

Dec. 31, 2019

The Company has five reportable segments: Independent Living; Assisted Living and Memory Care; CCRCs; Health Care Services; and Management Services. Operating segments are defined as components of an enterprise that engage in business activities from which it may earn revenues and incur expenses; for which separate financial information is available; and whose operating results are regularly reviewed by the chief operating decision maker to assess the performance of the individual segment and make decisions about resources to be allocated to the segment.

Independent Living. The Company's Independent Living segment includes owned or leased communities that are primarily designed for middle to upper income seniors who desire an upscale residential environment providing the highest quality of service. The majority of the Company's independent living communities consist of both independent and assisted living units in a single community, which allows residents to age-in-place by providing them with a broad continuum of senior independent and assisted living services.

Assisted Living and Memory Care. The Company's Assisted Living and Memory Care segment includes owned or leased communities that offer housing and 24-hour assistance with ADLs to mid-acuity frail and elderly residents. Assisted living and memory care communities include both freestanding, multi-story communities and freestanding, single story communities. The Company also provides memory care services at freestanding memory care communities that are specially designed for residents with Alzheimer's disease and other dementias.

CCRCs. The Company's CCRCs segment includes large owned or leased communities that offer a variety of living arrangements and services to accommodate all levels of physical ability and health. Most of the Company's CCRCs have independent living, assisted living, and skilled nursing available on one campus or within the immediate market, and some also include memory care services.

Health Care Services. The Company's Health Care Services segment includes the home health, hospice, and outpatient therapy services, as well as education and wellness programs, provided to residents of many of the Company's communities and to seniors living outside of the Company's communities. The Health Care Services segment does not include the skilled nursing and inpatient healthcare services provided in the Company's skilled nursing units, which are included in the Company's CCRCs segment.

Management Services. The Company's Management Services segment includes communities operated by the Company pursuant to management agreements. In some of the cases, the controlling financial interest in the community is held by third parties and, in other cases, the community is owned in a venture structure in which the Company has an ownership interest. Under the

management agreements for these communities, the Company receives management fees as well as reimbursed expenses, which represent the reimbursement of expenses it incurs on behalf of the owners.

The accounting policies of the Company's reportable segments are the same as those described in the summary of significant accounting policies in Note 2.

The following table sets forth selected segment financial data:



	For the Years Ended December 31,
(in thousands)	2019			2018			2017
Revenue:
Independent Living ⁽¹⁾	$	544,558		$	599,977		$	654,196
Assisted Living and Memory Care ⁽¹⁾	1,815,938			1,995,851			2,210,688
CCRCs ⁽¹⁾	402,175			416,408			468,994
Health Care Services ⁽¹⁾	447,260			436,975			446,262
Management Services ⁽²⁾	847,157			1,082,215			966,976
Total revenue	$	4,057,088		$	4,531,426		$	4,747,116
Segment Operating Income ⁽³⁾:
Independent Living	$	203,741		$	240,609		$	271,417
Assisted Living and Memory Care	518,636			628,982			749,058
CCRCs	72,072			92,212			106,162
Health Care Services	24,987			34,080			51,348
Management Services	57,108			71,986			75,845
Total segment operating income	876,544			1,067,869			1,253,830
General and administrative (including non-cash stock-based compensation expense)	219,289			259,475			278,019
Facility lease expense:
Independent Living	81,680			93,496			117,131
Assisted Living and Memory Care	157,823			178,716			185,971
CCRCs	24,248			24,856			29,464
Corporate and Management Services	5,915			6,226			7,155
Depreciation and amortization:
Independent Living	81,745			91,899			95,226
Assisted Living and Memory Care	222,574			261,365			290,344
CCRCs	44,163			53,551			44,294
Health Care Services	2,247			3,201			3,723
Corporate and Management Services	28,704			37,439			48,490
Goodwill and asset impairment:
Independent Living	1,812			2,013			2,968
Assisted Living and Memory Care	32,229			436,892			342,788
CCRCs	4,983			6,669			18,083
Health Care Services	7,578			9,055			14,599
Corporate and Management Services	2,664			35,264			31,344
Loss (gain) on facility lease termination and modification, net	3,388			162,001			14,276
Income (loss) from operations	$	(44,498	)	$	(594,249	)	$	(270,045	)

Total interest expense:
Independent Living	$	46,713		$	58,783		$	55,436
Assisted Living and Memory Care	166,097			174,459			207,861



CCRCs	27,426		26,746		27,665
Health Care Services	—		—		892
Corporate and Management Services	8,105		20,281		34,300
	$	248,341	$	280,269	$	326,154

Total capital expenditures for property, plant and equipment, and leasehold intangibles:
Independent Living	$	78,831	$	51,510	$	47,309
Assisted Living and Memory Care	157,845		125,750		119,717
CCRCs	33,535		26,615		24,297
Health Care Services	484		902		755
Corporate and Management Services	24,506		16,033		29,398
	$	295,201	$	220,810	$	221,476



	As of December 31,
(in thousands)	2019		2018
Total assets:
Independent Living	$	1,441,652	$	1,104,774
Assisted Living and Memory Care	4,157,610		3,684,170
CCRCs	742,809		707,819
Health Care Services	256,715		254,950
Corporate and Management Services	595,647		715,547
Total assets	$	7,194,433	$	6,467,260


(1)	All revenue is earned from external third parties in the United States.


(2)	Management services segment revenue includes reimbursements for which the Company is the primary obligor of costs incurred on behalf of managed communities.

(3)

Segment operating income is defined as segment revenues less segment facility operating expenses (excluding facility depreciation and amortization) and costs incurred on behalf of managed communities.