agilon health, inc.’s consolidated assets and liabilities as of December 31, 2022 and 2021 include certain assets of VIEs that can only be used to settle the liabilities of the related VIE. The VIE creditors do not have recourse to agilon health, inc.

agilon health, inc.’s consolidated assets and liabilities include VIE assets and liabilities as follows (in thousands):


	December 31,
	2022		2021
Assets(1)
Cash and cash equivalents	$	155,819	$	104,741
Restricted cash equivalents		10,610		13,210
Receivables, net		492,077		276,590
Prepaid expenses and other current assets, net		15,515		7,046
Property and equipment, net		1,567		1,147
Intangible assets, net		17,347		7,220
Other assets, net		10,371		10,580
Liabilities(1)
Medical claims and related payables		300,798		195,812
Accounts payable and accrued expenses		159,526		81,702
Other liabilities		2,059		4,521

(1)

Assets and liabilities of VIEs presented above include the assets and liabilities of the Company’s Independent Practice Associations in California, which are consolidated VIEs and whose operations are reflected in the consolidated financial statements as discontinued operations.

Risk-bearing Entities. At December 31, 2022, the Company operates 28 wholly-owned risk-bearing entities (“RBEs”) for the purpose of entering into risk-bearing contracts with payors. Each RBE’s equity at risk is considered insufficient to finance its activities without additional support, and, therefore, each RBE is considered a VIE. The Company consolidates the RBEs as it has determined that it is the primary beneficiary because it has: (i) the ability to control the activities that most significantly impact the RBEs’ economic performance; and (ii) the obligation to absorb losses or right to receive benefits that could potentially be significant to the RBEs. Specifically, the Company has the unilateral ability and authority, through the RBE governance and management agreements, to make significant decisions about strategic and operating activities of the RBEs, including negotiating and entering into risk-bearing contracts with payors, and approving the RBEs’ annual operating budgets. The Company also has the obligation to fund losses of the RBEs and the right to receive a significant percentage of any financial surplus generated by the RBEs. The assets of the RBEs primarily consist of cash and cash equivalents, receivables, net, intangible assets, net, and other assets, net; its obligations primarily consist of medical claims and related payables as well as operating expenses of the RBEs (accounts payable and accrued expenses), including incentive compensation obligations to the Company’s physician partners. On February 18, 2021, the Company executed the Credit Facilities, which are guaranteed by certain of the Company’s VIEs. Assets generated by the RBEs (primarily from medical services revenues) may be used, in certain limited circumstances, to settle the Company’s contractual debt obligations.

As of December 31, 2022, the Company had nine equity method investments (liabilities) that were deemed to be VIEs. The Company has determined that the activities that most significantly impact the performance of these VIEs consist of the allocation of resources to and other decisions related to clinical activities and provider contracting decisions. Because the Company does not have the ability to control these activities due to another party’s control of the VIEs’ board of directors, the Company has determined that it is not the primary beneficiary of and therefore does not consolidate these VIEs. The Company's maximum loss exposure as a result of the Company’s involvement with the VIEs cannot be quantified as the Company has the obligation to provide ongoing operational support to the unconsolidated VIEs, as needed.

The following table summarizes the Company’s equity method investments (in thousands):


	December 31,
	2022			2021
Equity method investments - Other(1)	$	8,329		$	6,690
Equity method investments - DCEs(1)		9,023			—
Equity method liabilities - DCEs(2)		(4,657	)		(6,380	)

(1)

Included in Other assets, net in the consolidated balance sheets.

(2)

Included in Other liabilities in the consolidated balance sheets.

The Company is a partner in eight wholly-owned DCEs in collaboration with 12 of its physician group partners operating in 10 geographies. The combined summarized operating results of the Company’s DCEs, which are recognized as equity income (loss), are as follows (in thousands):


	Year Ended December 31,
	2022			2021
Medical services revenue	$	1,071,302		$	437,081
Medical services expense		(991,565	)		(424,816	)
Other medical expenses(1)		(52,041	)		(12,219	)
Income (loss) from operations		14,294			(6,737	)
Net income (loss)(2)		10,556			(7,143	)

(1)

For the years ended December 31, 2022 and 2021, includes physician compensation expenses of $27.1 million and $1.0 million, respectively.

(2)

Included in Other income (expense), net in the consolidated statement of operations.

The combined summarized balance sheet of the Company’s DCEs are as follows (in thousands):


	December 31,
	2022		2021
Current and total assets	$	70,625	$	80,890
Current and total liabilities		67,343		88,033