Note 4 - Revenue

9 Months Ended

Sep. 30, 2025

Notes to Financial Statements

Revenue from Contract with Customer [Text Block]

Note 4. Revenue and accounts receivable

Revenue for the three and nine months ended September 30, 2025 is primarily derived from services rendered to patients for outpatient behavioral health care, interventional psychiatry, and pain management procedures. The Company’s services have no fixed duration and can generally be terminated by the patient or the Company at any time; therefore, each treatment or visit is considered its own stand-alone contract.

The Company disaggregates revenue from contracts with customers by service type and by payor, as management believes this best depicts the nature, amount, timing, and uncertainty of revenue and cash flows.

Revenue by Service Type (in thousands):

	Three Months Ended September 30, 2025		Nine Months Ended September 30, 2025
Procedures income	$	90	$	90
Therapy services		152		152
Total net patient service revenue	$	242	$	242

Revenue by payor (in thousands):

	Three Months Ended September 30, 2025		Nine Months Ended September 30, 2025
Commercial Insurance	$	156	$	156
Medicare		9		9
Self-Pay		77		77
Total net patient service revenue	$	242	$	242

The Company receives payments from the following sources: (i) commercial insurers; (ii) the federal government under the Medicare program administered by the Centers for Medicare and Medicaid Services (“CMS”) and other programs; (iii) state governments under Medicaid and related programs; and (iv) individual patients and clients.

The Company determines the transaction price based on established billing rates reduced by contractual adjustments, discounts, and implicit price concessions, which represent amounts the Company does not expect to collect based on historical experience and other relevant factors. Contractual adjustments and discounts are based on contractual agreements with commercial insurance and Medicare, discount policies, and historical experience. Implicit price concessions are based on historical collection experience. Most of the Company’s services have contracts containing variable considerations, such as contractual adjustments, discounts, and implicit price concessions, which are estimated and reflected as reductions to revenue in the period the services are provided. However, it is unlikely a significant reversal of revenue will occur when the uncertainty is resolved, and therefore, the Company includes the variable consideration in the estimated transaction price. Subsequent changes resulting from a patient’s ability to pay are recorded as credit loss expense, which is included in other operating expenses. For the nine months ended September 30, 2025, current expected credit loss recovery was less than $0.01 million reflecting a net reversal of the allowance for credit losses following the acquisition of Dura.

The Company derives a significant portion of its revenue from Medicare, and other payors that receive discounts from established billing rates. The Medicare regulations and various managed care contracts under which these discounts must be estimated are complex, subject to interpretation and adjustment, and may include multiple reimbursement mechanisms for different types of services provided. Management estimates the transaction price on a payor specific basis given its interpretation of the applicable regulations or contract terms. The services authorized and provided and related reimbursement are often subject to interpretation that could result in payments that differ from the Company’s estimates.

Accounts Receivable and allowance for credit loss

Accounts Receivable (in thousands):

	September 30, 2025
Accounts receivable, gross	$	349
Less: allowance for credit losses		(110	)
Accounts receivable, net	$	239

Allowance for credit losses roll-forward (in thousands):

Beginning balance as of December 31, 2024	$	-
Acquisition of Dura (September 8, 2025)		113
Provision (recovery) for expected credit losses		(3	)
Write-offs, net of recoveries		-
Ending Balance as of September 30, 2025	$	110

Accounts Receivable by payor (in thousands):

	September 30, 2025
Commercial insurance	$	198
Medicare		34
Self-pay		117
Accounts receivable, gross	$	349

Estimation inputs and credit quality information (summary):

● Receivables are pooled by payer class and aging; loss rates reflect historical experience updated for current conditions and reasonable‑and‑supportable forecasts with reversion to long‑run averages beyond the forecast horizon. The Company does not suspend recognition of revenue on a “nonaccrual” basis for trade receivables.