Quarterly report pursuant to Section 13 or 15(d)

SEGMENT REPORTING

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SEGMENT REPORTING
 9 Months Ended
Sep. 30, 2022
Segment Reporting [Abstract]  
SEGMENT REPORTING

15. SEGMENT REPORTING

 

The Company’s Chief Executive Officer and Executive Chairman jointly 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) Medical Practice Management.

 

The Healthcare IT segment includes revenue cycle management, SaaS solutions and other services. The Medical Practice Management segment includes the management of three medical practices. 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 that 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, 2021 filed with the SEC on March 14, 2022. The following table presents revenues, operating expenses and operating income (loss) by reportable segment:

 

                                 
    Nine Months Ended September 30, 2022  
    ($ in thousands)  
    Healthcare IT     Medical Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 96,146     $ 10,146     $ -     $ 106,292  
Operating expenses:                                
Direct operating costs     56,878       7,988       -       64,866  
Selling and marketing     7,293       21       -       7,314  
General and administrative     10,213       1,312       6,954       18,479  
Research and development     3,251       -       -       3,251  
Change in contingent consideration     (2,890 )     -       -       (2,890 )
Depreciation and amortization     8,420       266       -       8,686  
Net loss on lease termination and unoccupied lease charges     928       -       -       928  
Total operating expenses     84,093       9,587       6,954       100,634  
Operating income (loss)   $ 12,053     $ 559     $ (6,954 )   $ 5,658  

 

                                 
    Three Months Ended September 30, 2022  
    ($ in thousands)  
    Healthcare IT     Medical Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 29,964     $ 3,759     $ -     $ 33,723  
Operating expenses:                                
Direct operating costs     17,582       2,824       -       20,406  
Selling and marketing     2,496       8       -       2,504  
General and administrative     3,231       455       2,814       6,500  
Research and development     1,168       -       -       1,168  
Change in contingent consideration     (1,660 )     -       -       (1,660 )
Depreciation and amortization     2,721       89       -       2,810  
Loss on lease termination and unoccupied lease charges     307       -       -       307  
Total operating expenses     25,845       3,376       2,814       32,035  
Operating income (loss)   $ 4,119     $ 383     $ (2,814 )   $ 1,688  

 

                                 
    Nine Months Ended September 30, 2021  
    ($ in thousands)  
    Healthcare IT     Medical Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 92,797     $ 9,340     $ -     $ 102,137  
Operating expenses:                                
Direct operating costs     55,473       7,246       -       62,719  
Selling and marketing     6,446       23       -       6,469  
General and administrative     10,175       1,487       6,152       17,814  
Research and development     4,328       -       -       4,328  
Depreciation and amortization     9,251       254       -       9,505  
Loss on lease termination, impairment and unoccupied lease charges     1,664       -       -       1,664  
Total operating expenses     87,337       9,010       6,152       102,499  
Operating income (loss)   $ 5,460     $ 330     $ (6,152 )   $ (362 )

 

 

                                 
    Three Months Ended September 30, 2021  
    ($ in thousands)  
    Healthcare IT     Medical Practice Management     Unallocated Corporate Expenses     Total  
Net revenue   $ 34,678     $ 3,626     $ -     $ 38,304  
Operating expenses:                                
Direct operating costs     21,324       2,800       -       24,124  
Selling and marketing     2,368       7       -       2,375  
General and administrative     3,336       471       2,114       5,921  
Research and development     488       -       -       488  
Depreciation and amortization     3,459       88       -       3,547  
Loss on lease termination and unoccupied lease charges     424       -       -       424  
Total operating expenses     31,399       3,366       2,114       36,879  
Operating income (loss)   $ 3,279     $ 260     $ (2,114 )   $ 1,425