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Variable Interest Entities (Tables)

9 Months Ended

Sep. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of Consolidated Asset and Liabilities Include VIE Assets and Liabilities

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


	September 30, 2023		December 31, 2022
Assets
Cash and cash equivalents	$	86,581	$	155,819
Restricted cash equivalents	10,202		10,610
Receivables, net	1,334,394		492,077
Prepaid expenses and other current assets, net	20,781		15,515
Property and equipment, net	1,817		1,567
Intangible assets, net	20,187		17,347
Other assets, net	9,790		10,371
Liabilities
Medical claims and related payables	962,505		300,798
Accounts payable and accrued expenses	259,553		159,526
Other liabilities	4,188		2,059

Schedule of Equity Method Investments

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


	September 30, 2023		December 31, 2022
Equity method investments - Other(1)	$	9,114	$	8,329
Equity method investments - ACO REACH(1)	30,056		9,023
Equity method liabilities - ACO REACH(2)	—		(4,657)

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(1)Included in Other assets, net in the condensed consolidated balance sheets.

(2)Included in Other liabilities in the condensed consolidated balance sheets.

Summary of Operating Results

The combined summarized operating results of the Company’s ACO REACH entities are as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Medical services revenue	$	296,937	$	241,408	$	858,286	$	786,171
Medical services expense	(242,431)		(231,910)		(741,752)		(735,924)
Other medical expenses(1)	(31,970)		(9,215)		(71,138)		(34,019)
Income (loss) from operations	18,330		(3,035)		31,515		6,333
Net income (loss)(2)	14,628		(4,361)		24,388		3,345

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(1)For the three months ended September 30, 2023 and 2022, includes physician incentive expenses of $25.1 million and $2.9 million, respectively. For the nine months ended September 30, 2023 and 2022, includes physician incentive expenses of $51.4 million and $15.0 million, respectively.

(2)Included in Income (loss) from equity method investments in the condensed consolidated statements of operations.

Summarized Balance Sheet

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


	September 30, 2023		December 31, 2022
Current assets	$	165,257	$	70,625
Noncurrent assets	130		—
Total assets	165,387		70,625
Current and total liabilities	136,285		67,343

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

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