5.Segments and Nature of the Business

Our segments include the VITAS segment and the Roto-Rooter segment. Relative contributions of each segment to service revenues and sales were 69% and 31%, respectively, in 2017 and 71% and 29%, respectively, in 2016. The vast majority of our service revenues and sales from continuing operations are generated from business within the United States.

The reportable segments have been defined along service lines, which is consistent with the way the businesses are managed. In determining reportable segments, the RRSC and RRC operating units of the Roto-Rooter segment have been aggregated on the basis of possessing similar operating and economic characteristics. The characteristics of these operating segments and the basis for aggregation are reviewed annually. Accordingly, the reportable segments are defined as follows:

The VITAS segment provides hospice services for patients with terminal illnesses. This type of care is aimed at making the terminally ill patient’s end of life as comfortable and pain-free as possible. Hospice care is available to patients who have been initially certified or re-certified as terminally ill (i.e., a prognosis of six months or less) by their attending physician, if any, and the hospice physician. VITAS offers all levels of hospice care in a given market, including routine home care, inpatient care and continuous care. Over 95% of VITAS’ revenues are derived through the Medicare and Medicaid reimbursement programs.

The Roto-Rooter segment provides plumbing, drain cleaning and water restoration services to residential and commercial accounts using the Roto-Rooter registered service marks. They are delivered through company-owned and operated territories, independent contractor-operated territories and franchised locations. This segment also manufactures and sells products and equipment used to provide such services.

We report corporate administrative expenses and unallocated investing and financing income and expense not directly related to either segment as “Corporate”. Corporate administrative expense includes the stewardship, accounting and reporting, legal, tax and other costs of operating a publicly held corporation. Corporate investing and financing income and expenses include the costs and income associated with corporate debt and investment arrangements.

Segment data are set forth below (in thousands):


		For the Years Ended December 31,
		2017		2016		2015
Revenues by Type of Service
VITAS
Routine homecare	$	935,913	$	887,940	$	865,145
Continuous care		124,557		138,025		150,802
General inpatient		90,472		97,580		99,439
Medicare cap		(2,682)		(228)		165
Total segment		1,148,260		1,123,317		1,115,551
Roto-Rooter
Plumbing repair and maintenance		219,516		197,280		188,065
Sewer and drain cleaning		151,667		145,699		142,562
Water restoration		82,272		50,229		38,163
Independent contractors		43,770		40,097		37,966
Other products and services		21,239		20,259		21,081
Total segment		518,464		453,564		427,837
Total service revenues and sales	$	1,666,724	$	1,576,881	$	1,543,388
Aftertax Segment Earnings/(Loss)
VITAS	$	57,645	$	84,961	$	93,346
Roto-Rooter		73,299		52,893		48,573
Total		130,944		137,854		141,919
Corporate		(32,767)		(29,111)		(31,645)
Net income	$	98,177	$	108,743	$	110,274
Interest Income
VITAS	$	12,044	$	8,294	$	7,740
Roto-Rooter		5,635		3,653		3,425
Total		17,679		11,947		11,165
Intercompany eliminations		(17,252)		(11,564)		(10,884)
Total interest income	$	427	$	383	$	281
Interest Expense
VITAS	$	188	$	211	$	200
Roto-Rooter		323		332		348
Total		511		543		548
Corporate		3,761		3,172		3,097
Total interest expense	$	4,272	$	3,715	$	3,645

Income Tax Provision
VITAS	$	16,436	$	51,910	$	56,675
Roto-Rooter		32,782		32,719		29,630
Total		49,218		84,629		86,305
Corporate		(30,478)		(16,318)		(16,453)
Total income tax provision	$	18,740	$	68,311	$	69,852
Identifiable Assets
VITAS	$	545,304	$	542,142	$	523,717
Roto-Rooter		294,663		261,641		255,192
Total		839,967		803,783		778,909
Corporate		80,059		76,276		73,416
Total identifiable assets	$	920,026	$	880,059	$	852,325


		For the Years Ended December 31,
		2017		2016		2015
Additions to Long-Lived Assets
VITAS	$	23,469	$	22,000	$	23,278
Roto-Rooter		45,386		17,709		26,476
Total		68,855		39,709		49,754
Corporate		483		63		995
Total additions to long-lived assets	$	69,338	$	39,772	$	50,749
Depreciation and Amortization
VITAS	$	18,630	$	19,090	$	19,547
Roto-Rooter		16,790		15,002		13,360
Total		35,420		34,092		32,907
Corporate		205		546		592
Total depreciation and amortization	$	35,625	$	34,638	$	33,499