Non-Insurance

3 Months Ended

Mar. 31, 2023

In April 2021, the Company began participating in the DC Model of the Centers for Medicare & Medicaid Services ("CMS"), which utilizes a structured model intended to reduce expenditures and preserve or enhance quality of care for beneficiaries in Medicare fee-for-service ("FFS"). CMS redesigned the DC Model and renamed the model the ACO Realizing Equity, Access, and Community Health (REACH) Model ("ACO REACH Model") effective January 1, 2023. As a participating entity in the DC Model, referred to as the ACO REACH Model at January 1, 2023, with a global risk arrangement, the Company assumes the responsibility of guaranteeing the performance of its care network. The ACO REACH Model is intended to reduce the administrative burden, support a focus on complex, chronically ill patients, and encourage physician organizations that have not typically participated in Medicare FFS to serve beneficiaries in Medicare FFS. The Company's operations in connection with both the DC Model and ACO REACH Model are included in the Non-Insurance operating segment. See Note 16 (Operating Segments) for additional information.

Performance Guarantees

Certain of the Company's arrangements with third-party providers require it to guarantee the performance of its care network to CMS, which, if not obtained, could potentially result in payment to CMS. The Non-Insurance performance year obligation and receivable are

amortized on a straight-line basis for the amount that represents the completed performance. The Company is unable to estimate the maximum potential amount of future payments under the guarantee. This is attributable to the stop-loss arrangement and the corridors (tiered levels) in the arrangement. A certain percentage of these arrangements will still be the responsibility of the Company, in addition to a number of variables that are not reasonable for the Company to estimate, such as, but not limited to, risk ratings and benchmark trends that have an inestimable impact on the estimate of future payments.

For additional information, see Note 2 (Summary of Significant Accounting Policies) and Note 22 (Non-Insurance) in the 2022 Form 10-K.

The tables below include the financial statement impacts of the performance guarantee:


	March 31, 2023		December 31, 2022
	(in thousands)
Non-Insurance performance year receivable	$	552,620	$	—
Non-Insurance performance year obligation (1)	613,057		73,844
(1) This obligation represents the consideration due to providers, net of the shared savings or loss for the period and amortization of the liability.


	Three months ended March 31, 2023		Three months ended March 31, 2022
	(in thousands)
Amortization of the Non-Insurance performance year receivable	$	(184,207)	$	(586,715)
Amortization of the Non-Insurance performance year obligation	184,207		586,715

Non-Insurance revenue	205,783		594,898