Quarterly report pursuant to Section 13 or 15(d)

Segment Reporting

v3.20.2
Segment Reporting
 6 Months Ended
Jun. 30, 2020
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, SaaS solutions 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, 2019 filed with the SEC on February 28, 2020. The following tables present revenues, operating expenses and operating (loss) income by reportable segment:

 

    Six Months Ended June 30, 2020  
    Healthcare IT     Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 35,967,075     $ 5,478,883     $ -     $ 41,445,958  
Operating expenses:                                
Direct operating costs     21,926,644       4,196,760       -       26,123,404  
Selling and marketing     3,189,461       16,937       -       3,206,398  
General and administrative     6,894,125       1,024,695       3,066,762       10,985,582  
Research and development     4,479,451       -       -       4,479,451  
Depreciation and amortization     3,578,708       158,993       -       3,737,701  
Impairment and unoccupied lease charges     360,826       -       -       360,826  
Total operating expenses     40,429,215       5,397,385       3,066,762       48,893,362  
Operating (loss) income   $ (4,462,140 )   $ 81,498     $ (3,066,762 )   $ (7,447,404 )

 

    Three Months Ended June 30, 2020  
    Healthcare IT     Practice Management    

Unallocated Corporate

Expenses

     Total  
Net revenue   $ 17,126,211     $ 2,452,579     $ -     $ 19,578,790  
Operating expenses:                                
Direct operating costs     10,760,718       1,795,956       -       12,556,674  
Selling and marketing     1,616,689       8,356       -       1,625,045  
General and administrative     3,013,903       468,187       1,910,767       5,392,857  
Research and development     2,146,325       -       -       2,146,325  
Depreciation and amortization     2,325,418       79,497       -       2,404,915  
Impairment and unoccupied lease charges     63,175       -       -       63,175  
Total operating expenses     19,926,228       2,351,996       1,910,767       24,188,991  
Operating (loss) income   $ (2,800,017 )   $ 100,583     $ (1,910,767 )   $ (4,610,201 )

 

    Six Months Ended June 30, 2019  
    Healthcare IT     Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 25,580,319     $ 6,249,391     $ -     $ 31,829,710  
Operating expenses:                                
Direct operating costs     16,403,912       4,840,023       -       21,243,935  
Selling and marketing     726,147       17,809       -       743,956  
General and administrative     5,757,549       955,760       2,592,521       9,305,830  
Research and development     473,064       -       -       473,064  
Change in contingent consideration     (64,203 )     -       -       (64,203 )
Depreciation and amortization     1,435,071       157,830       -       1,592,901  
Total operating expenses     24,731,540       5,971,422       2,592,521       33,295,483  
Operating income (loss)   $ 848,779     $ 277,969     $ (2,592,521 )   $ (1,465,773 )

 

    Three Months Ended June 30, 2019  
    Healthcare IT     Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 13,460,575     $ 3,288,924     $ -     $ 16,749,499  
Operating expenses:                                
Direct operating costs     8,929,458       2,466,937       -       11,396,395  
Selling and marketing     374,196       8,361       -       382,557  
General and administrative     3,295,146       559,390       1,289,218       5,143,754  
Research and development     218,408       -       -       218,408  
Depreciation and amortization     757,084       79,077       -       836,161  
Total operating expenses     13,574,292       3,113,765       1,289,218       17,977,275  
Operating (loss) income   $ (113,717 )   $ 175,159     $ (1,289,218 )   $ (1,227,776 )