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Leases
 9 Months Ended
Sep. 30, 2021
Leases [Abstract]  
Leases LeasesAs of September 30, 2021, the Company operated 300 communities under long-term leases (234 operating leases and 66 financing leases). The substantial majority of the Company's lease arrangements are structured as master leases. Under a master
lease, numerous communities are leased through an indivisible lease. The Company typically guarantees the performance and lease payment obligations of its subsidiary lessees under the master leases. An event of default related to an individual property or limited number of properties within a master lease portfolio may result in a default on the entire master lease portfolio.

The leases relating to these communities are generally fixed rate leases with annual escalators that are either fixed or based upon changes in the consumer price index or the leased property revenue. The Company is responsible for all operating costs, including repairs, property taxes, and insurance. The leases generally provide for renewal or extension options from 5 to 20 years and in some instances, purchase options.

The community leases contain other customary terms, which may include assignment and change of control restrictions, maintenance and capital expenditure obligations, termination provisions and financial covenants, such as those requiring the Company to maintain prescribed minimum liquidity, net worth, and stockholders' equity levels and lease coverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community and/or entity basis. In addition, the Company's lease documents generally contain non-financial covenants, such as those requiring the Company to comply with Medicare or Medicaid provider requirements and maintain insurance coverage.

The Company's failure to comply with applicable covenants could constitute an event of default under the applicable lease documents. Many of the Company's debt and lease documents contain cross-default provisions so that a default under one of these instruments could cause a default under other debt and lease documents (including documents with other lenders and lessors). Certain leases contain cure provisions, which generally allow the Company to post an additional lease security deposit if the required covenant is not met. Furthermore, the Company's leases are secured by its communities and, in certain cases, a guaranty by the Company and/or one or more of its subsidiaries.

As of September 30, 2021, the Company is in compliance with the financial covenants of its long-term leases.

A summary of operating and financing lease expense (including the respective presentation on the condensed consolidated statements of operations) and net cash outflows from leases is as follows:
Three Months Ended
September 30,		Nine Months Ended
September 30,
Operating Leases (in thousands)
2021202020212020
Facility operating expense$1,634 $4,755 $10,996 $14,540 
Facility lease expense43,226 51,620 131,508 178,480 
Operating lease expense44,860 56,375 142,504 193,020 
Operating lease expense adjustment (1)
6,273 117,322 16,263 132,276 
Changes in operating lease assets and liabilities for lessor capital expenditure reimbursements(11,551)(3,131)(27,057)(13,640)
Operating net cash outflows from operating leases$39,582 $170,566 $131,710 $311,656 

(1)Represents the difference between the amount of cash operating lease payments and the amount of operating lease expense recognized in accordance with ASC 842, Leases. Operating net cash outflows from operating leases for the three and nine months ended September 30, 2020 include the $119.2 million one-time cash lease payment made to Ventas in connection with the Company's lease restructuring transaction effective July 26, 2020.
Three Months Ended
September 30,		Nine Months Ended
September 30,
Financing Leases (in thousands)
2021202020212020
Depreciation and amortization$7,677 $7,818 $22,901 $24,999 
Interest expense: financing lease obligations11,674 11,908 34,549 37,082 
Financing lease expense$19,351 $19,726 $57,450 $62,081 
Operating cash outflows from financing leases$11,674 $11,908 $34,549 $37,082 
Financing cash outflows from financing leases5,039 4,548 14,692 14,312 
Changes in financing lease assets and liabilities for lessor capital expenditure reimbursement(4,136)(923)(7,583)(4,337)
Total net cash outflows from financing leases$12,577 $15,533 $41,658 $47,057 

The aggregate amounts of future minimum lease payments, including community, office, and equipment leases recognized on the condensed consolidated balance sheet as of September 30, 2021 are as follows (in thousands):
Year Ending December 31,Operating LeasesFinancing Leases
2021 (three months)$50,822 $16,608 
2022205,262 67,070 
2023193,855 67,791 
2024194,607 68,992 
2025192,345 59,023 
Thereafter284,938 112,922 
Total lease payments1,121,829 392,406 
Purchase option liability and non-cash gain on future sale of property— 416,575 
Imputed interest and variable lease payments(249,292)(252,494)
Total lease obligations$872,537 $556,487 
Leases LeasesAs of September 30, 2021, the Company operated 300 communities under long-term leases (234 operating leases and 66 financing leases). The substantial majority of the Company's lease arrangements are structured as master leases. Under a master
lease, numerous communities are leased through an indivisible lease. The Company typically guarantees the performance and lease payment obligations of its subsidiary lessees under the master leases. An event of default related to an individual property or limited number of properties within a master lease portfolio may result in a default on the entire master lease portfolio.

The leases relating to these communities are generally fixed rate leases with annual escalators that are either fixed or based upon changes in the consumer price index or the leased property revenue. The Company is responsible for all operating costs, including repairs, property taxes, and insurance. The leases generally provide for renewal or extension options from 5 to 20 years and in some instances, purchase options.

The community leases contain other customary terms, which may include assignment and change of control restrictions, maintenance and capital expenditure obligations, termination provisions and financial covenants, such as those requiring the Company to maintain prescribed minimum liquidity, net worth, and stockholders' equity levels and lease coverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community and/or entity basis. In addition, the Company's lease documents generally contain non-financial covenants, such as those requiring the Company to comply with Medicare or Medicaid provider requirements and maintain insurance coverage.

The Company's failure to comply with applicable covenants could constitute an event of default under the applicable lease documents. Many of the Company's debt and lease documents contain cross-default provisions so that a default under one of these instruments could cause a default under other debt and lease documents (including documents with other lenders and lessors). Certain leases contain cure provisions, which generally allow the Company to post an additional lease security deposit if the required covenant is not met. Furthermore, the Company's leases are secured by its communities and, in certain cases, a guaranty by the Company and/or one or more of its subsidiaries.

As of September 30, 2021, the Company is in compliance with the financial covenants of its long-term leases.

A summary of operating and financing lease expense (including the respective presentation on the condensed consolidated statements of operations) and net cash outflows from leases is as follows:
Three Months Ended
September 30,		Nine Months Ended
September 30,
Operating Leases (in thousands)
2021202020212020
Facility operating expense$1,634 $4,755 $10,996 $14,540 
Facility lease expense43,226 51,620 131,508 178,480 
Operating lease expense44,860 56,375 142,504 193,020 
Operating lease expense adjustment (1)
6,273 117,322 16,263 132,276 
Changes in operating lease assets and liabilities for lessor capital expenditure reimbursements(11,551)(3,131)(27,057)(13,640)
Operating net cash outflows from operating leases$39,582 $170,566 $131,710 $311,656 

(1)Represents the difference between the amount of cash operating lease payments and the amount of operating lease expense recognized in accordance with ASC 842, Leases. Operating net cash outflows from operating leases for the three and nine months ended September 30, 2020 include the $119.2 million one-time cash lease payment made to Ventas in connection with the Company's lease restructuring transaction effective July 26, 2020.
Three Months Ended
September 30,		Nine Months Ended
September 30,
Financing Leases (in thousands)
2021202020212020
Depreciation and amortization$7,677 $7,818 $22,901 $24,999 
Interest expense: financing lease obligations11,674 11,908 34,549 37,082 
Financing lease expense$19,351 $19,726 $57,450 $62,081 
Operating cash outflows from financing leases$11,674 $11,908 $34,549 $37,082 
Financing cash outflows from financing leases5,039 4,548 14,692 14,312 
Changes in financing lease assets and liabilities for lessor capital expenditure reimbursement(4,136)(923)(7,583)(4,337)
Total net cash outflows from financing leases$12,577 $15,533 $41,658 $47,057 

The aggregate amounts of future minimum lease payments, including community, office, and equipment leases recognized on the condensed consolidated balance sheet as of September 30, 2021 are as follows (in thousands):
Year Ending December 31,Operating LeasesFinancing Leases
2021 (three months)$50,822 $16,608 
2022205,262 67,070 
2023193,855 67,791 
2024194,607 68,992 
2025192,345 59,023 
Thereafter284,938 112,922 
Total lease payments1,121,829 392,406 
Purchase option liability and non-cash gain on future sale of property— 416,575 
Imputed interest and variable lease payments(249,292)(252,494)
Total lease obligations$872,537 $556,487