Quarterly report pursuant to Section 13 or 15(d)

Segment Reporting

v3.19.3
Segment Reporting
 9 Months Ended
Sep. 30, 2019
Segment Reporting [Abstract]  
Segment Reporting

14. SEGMENT REPORTING

 

Both our Chief Executive Officer and Executive Chairman serve as the Chief Operating Decision Maker (“CODM”), organize the Company, manage resource allocations and measure performance among two operating and reportable segments: (i) Healthcare IT and (ii) Practice Management.

 

The Healthcare IT segment includes revenue cycle management and other services. The Practice Management segment includes the management of three medical practices and starting April 1, 2019, certain practice management services are being provided to a fourth practice. Each segment is considered a reporting unit. The CODM evaluates financial performance of the business units on the basis of revenue and direct operating costs excluding unallocated amounts, which are mainly corporate overhead costs. Our CODM does not evaluate operating segments using asset or liability information. The accounting policies of the segments are the same as those disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the SEC on March 20, 2019. The following tables present revenues, operating expenses and operating income (loss) by reportable segment:

 

    Nine Months Ended September 30, 2019  
    Healthcare IT     Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 38,518,361     $ 10,162,677     $ -     $ 48,681,038  
Operating expenses:                                
Direct operating costs     23,912,120       7,867,444       -       31,779,564  
Selling and marketing     1,065,750       25,774       -       1,091,524  
General and administrative     8,549,122       1,504,506       3,704,177       13,757,805  
Research and development     648,822       -       -       648,822  
Change in contingent consideration     (343,768 )     -       -       (343,768 )
Depreciation and amortization     2,170,204       236,907       -       2,407,111  
Restructuring and impairment charges     136,332       -       -       136,332  
Total operating expenses     36,138,582       9,634,631       3,704,177       49,477,390  
Operating income (loss)   $ 2,379,779     $ 528,046     $ (3,704,177 )   $ (796,352 )

 

    Three Months Ended September 30, 2019  
    Healthcare IT     Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 12,938,042     $ 3,913,286     $ -     $ 16,851,328  
Operating expenses:                                
Direct operating costs     7,508,208       3,027,421       -       10,535,629  
Selling and marketing     339,603       7,965       -       347,568  
General and administrative     2,791,573       548,746       1,111,656       4,451,975  
Research and development     175,758       -       -       175,758  
Change in contingent consideration     (279,565 )     -       -       (279,565 )
Depreciation and amortization     735,133       79,077       -       814,210  
Restructuring and impairment charges     136,332       -       -       136,332  
Total operating expenses     11,407,042       3,663,209       1,111,656       16,181,907  
Operating income (loss)   $ 1,531,000     $ 250,077     $ (1,111,656 )   $ 669,421  

 

    Nine Months Ended September 30, 2018  
    Healthcare IT     Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 30,720,367     $ 3,314,421     $ -     $ 34,034,788  
Operating expenses:                                
Direct operating costs     18,303,270       2,638,265       -       20,941,535  
Selling and marketing     1,159,943       9,640       -       1,169,583  
General and administrative     6,591,165       552,514       3,642,555       10,786,234  
Research and development     768,517       -       -       768,517  
Change in contingent consideration     68,253       -       -       68,253  
Depreciation and amortization     1,890,809       81,756       -       1,972,565  
Total operating expenses     28,781,957       3,282,175       3,642,555       35,706,687  
Operating income (loss)   $ 1,938,410     $ 32,246     $ (3,642,555 )   $ (1,671,899 )

 

    Three Months Ended September 30, 2018  
    Healthcare IT     Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 13,730,105     $ 3,314,421     $ -     $ 17,044,526  
Operating expenses:                                
Direct operating costs     9,485,642       2,638,265       -       12,123,907  
Selling and marketing     451,872       9,640       -       461,512  
General and administrative     2,730,595       552,514       1,848,186       5,131,295  
Research and development     263,717       -       -       263,717  
Change in contingent consideration     25,473       -       -       25,473  
Depreciation and amortization     740,342       81,756       -       822,098  
Total operating expenses     13,697,641       3,282,175       1,848,186       18,828,002  
Operating income (loss)   $ 32,464     $ 32,246     $ (1,848,186 )   $ (1,783,476 )