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What changed in BrightSpring Health Services, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of BrightSpring Health Services, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+477 added−522 removedSource: 10-K (2026-02-27) vs 10-K (2025-03-06)

Top changes in BrightSpring Health Services, Inc.'s 2025 10-K

477 paragraphs added · 522 removed · 398 edited across 4 sections

Item 1. Business

Business — how the company describes what it does

97 edited+9 added−18 removed261 unchanged
Biggest changeFee-splitting, which describes the practice of professionals splitting their professional fees with a non-professional or other unlicensed person or an entity owned by an unlicensed person, is also prohibited in some jurisdictions. In some states, these prohibitions are expressly stated in a statute or regulation, while in other states the prohibitions are a matter of judicial or regulatory interpretation.
Biggest changeSome states have similar doctrines with respect to other professional licensure categories, including behavioral health services. Fee-splitting, which describes the practice of professionals splitting their professional fees with a non-professional or other unlicensed person or an entity owned by an unlicensed person, is also prohibited in some jurisdictions.
In turn, these enablers are required to execute three key integrated and value-based care strategies, including (i) the coordination of clinically integrated care for patients receiving multiple Company services across settings and over time, (ii) providing multiple integrated (or bundled) services to senior living communities, behavioral providers, skilled nursing and rehabilitation facility providers, hospitals, 2 Table of Contents and payors who all require our comprehensive offerings, and (iii) the execution of value-based care contracts, whether internal through the Company’s own ACO shared savings arrangements and managed care plans or whether external through third-party government or managed care entities.
In turn, these enablers are required to execute three key integrated and value-based care strategies, including (i) the coordination of clinically integrated care for patients receiving multiple Company services across settings and over time, (ii) providing multiple integrated (or bundled) services to senior living communities, behavioral providers, skilled nursing and rehabilitation facility providers, hospitals, and payors who all require our comprehensive offerings, and (iii) the execution of value-based care contracts, whether internal through 2 Table of Contents the Company’s own ACO shared savings arrangements and managed care plans or whether external through third-party government or managed care entities.
If any of our operations are found to violate applicable laws or regulations, we could suffer severe consequences that would have a material adverse effect on our business, financial condition, results of operations, cash flows, reputation, and stock price, including: • suspension, termination or exclusion of our participation in government payor programs; • loss of our licenses required to operate provider and pharmacy solutions in the states in which we operate; • criminal or civil liability, fines, damages or monetary penalties relating to healthcare fraud and abuse, including the Stark Law, the Anti-Kickback Statute, the Civil Monetary Penalties Statute, the False Claims Act and/or state analogs to these federal enforcement authorities, or violations of other regulatory requirements, including state corporate practice of medicine and fee splitting laws; • mandated changes to our practices or procedures that significantly increase selling, general, and administrative expenses or decrease our revenue; • imposition of and compliance with corporate integrity agreements or other agreements that could subject us to ongoing audits, corrective actions, and reporting requirements as well as increased scrutiny of our business practices which could lead to potential fines, among other things; 13 Table of Contents • termination or restructuring of various relationships and/or contracts related to our business, including joint venture arrangements, contracts with government payors, and real estate leases; • changes in and reinterpretation of rules and laws by a regulatory agency, legislature or court, such as state corporate practice of medicine laws, that could affect the structure and management of our business; • negative adjustments to government payment models including, but not limited to, Medicare Parts A, B, C, and D and Medicaid; • admissions bans, admissions holds, application denial periods, or reductions in census; and • harm to our reputation, which could negatively impact our business relationships, the terms of government payor contracts, our ability to attract and retain patients, customers and referral sources, our ability to obtain financing, and our access to new business opportunities, among other things.
If any of our operations are found to violate applicable laws or regulations, we could suffer severe consequences that would have a material adverse effect on our business, financial condition, results of operations, cash flows, reputation, and stock price, including: • suspension, termination or exclusion of our participation in government payor programs; • loss of our licenses required to operate provider and pharmacy solutions in the states in which we operate; • criminal or civil liability, fines, damages or monetary penalties relating to healthcare fraud and abuse, including the Stark Law, the Anti-Kickback Statute, the Civil Monetary Penalties Statute, the False Claims Act and/or state analogs to these federal enforcement authorities, or violations of other regulatory requirements, including state corporate practice of medicine and fee splitting laws; • mandated changes to our practices or procedures that significantly increase selling, general, and administrative expenses or decrease our revenue; • imposition of and compliance with corporate integrity agreements or other agreements that could subject us to ongoing audits, corrective actions, and reporting requirements as well as increased scrutiny of our business practices which could lead to potential fines, among other things; • termination or restructuring of various relationships and/or contracts related to our business, including joint venture arrangements, contracts with government payors, and real estate leases; • changes in and reinterpretation of rules and laws by a regulatory agency, legislature or court, such as state corporate practice of medicine laws, that could affect the structure and management of our business; • negative adjustments to government payment models including, but not limited to, Medicare Parts A, B, C, and D and Medicaid; • admissions bans, admissions holds, application denial periods, or reductions in census; and • harm to our reputation, which could negatively impact our business relationships, the terms of government payor contracts, our ability to attract and retain patients, customers and referral sources, our ability to obtain financing, and our access to new business opportunities, among other things.
In pharmacy, we leverage our national infrastructure to provide daily medication therapy management to various customer and patient types wherever they reside in the community, including home and in-clinic infusion patients, oncology and other specialty patients in their homes, residents of independent and senior living communities, people receiving hospice care, neuro and Behavioral clients’ and patients’ homes, residents of skilled nursing and rehabilitation facilities, hospital patients, and the homes of Seniors who are on a significant number of medications.
In pharmacy, we leverage our national infrastructure to provide daily medication therapy management to various customer and patient types wherever they reside in the community, including home and in-clinic infusion patients, oncology and other specialty patients in their homes, residents of independent and senior living communities, people receiving hospice care, and neuro clients’ and patients’ homes, residents of skilled nursing and rehabilitation facilities, hospital patients, and the homes of Seniors who are on a significant number of medications.
Civil Monetary Penalties Statute The Civil Monetary Penalties Statute, 42 U.S.C. § 1320a-7a, authorizes the imposition of civil monetary penalties, assessments, and exclusion against an individual or entity based on a variety of prohibited conduct, including, but not limited to: • presenting, or causing to be presented, claims, reports or records relating to payment by Medicare, Medicaid or other government payors that the individual or entity knows or should know are for an item or service that was not provided as claimed, is false or fraudulent or was presented for a physician’s service by a person who knows or should know that the individual providing the service is not a licensed physician, obtained licensure through misrepresentation or represented certification in a medical specialty without in fact possessing such certification; • offering remuneration to a federal healthcare program beneficiary that the individual or entity knows or should know is likely to influence the beneficiary to order or receive healthcare items or services from a particular provider; • arranging contracts with or making payments to an entity or individual excluded from participation in the federal healthcare programs or included on CMS’s preclusion list; • violating the Anti-Kickback Statute; • making, using, or causing to be made or used a false record or statement material to a false or fraudulent claim for payment for items and services furnished under a federal healthcare program; 16 Table of Contents • making, using, or causing to be made any false statement, omission, or misrepresentation of a material fact in any application, bid, or contract to participate or enroll as a provider of services or a supplier under a federal healthcare program; and • failing to report and return an overpayment owed to the federal government.
Civil Monetary Penalties Statute The Civil Monetary Penalties Statute, 42 U.S.C. § 1320a-7a, authorizes the imposition of civil monetary penalties, assessments, and exclusion against an individual or entity based on a variety of prohibited conduct, including, but not limited to: • presenting, or causing to be presented, claims, reports or records relating to payment by Medicare, Medicaid or other government payors that the individual or entity knows or should know are for an item or service that was not provided as claimed, is false or fraudulent or was presented for a physician’s service by a person who knows or should know that the individual providing the service is not a licensed physician, obtained licensure through misrepresentation or represented certification in a medical specialty without in fact possessing such certification; • offering remuneration to a federal healthcare program beneficiary that the individual or entity knows or should know is likely to influence the beneficiary to order or receive healthcare items or services from a particular provider; • arranging contracts with or making payments to an entity or individual excluded from participation in the federal healthcare programs or included on CMS’s preclusion list; • violating the Anti-Kickback Statute; • making, using, or causing to be made or used a false record or statement material to a false or fraudulent claim for payment for items and services furnished under a federal healthcare program; • making, using, or causing to be made any false statement, omission, or misrepresentation of a material fact in any application, bid, or contract to participate or enroll as a provider of services or a supplier under a federal healthcare program; and • failing to report and return an overpayment owed to the federal government.
Corporate Practice of Medicine and Fee-Splitting Laws Some of the states in which we currently operate have laws that prohibit business entities, such as us, from practicing medicine, employing physicians to practice medicine, exercising control over medical decisions by physicians or engaging in certain arrangements, such as fee-splitting, with physicians (such activities generally referred to as the corporate practice of medicine).
Corporate Practice of Medicine and Fee-Splitting Laws Some of the states in which we currently operate have laws that prohibit business entities, such as us, from practicing medicine, employing physicians to practice medicine, exercising control over medical decisions by physicians or engaging in certain arrangements, such as fee-splitting, with physicians (such activities are generally referred to as the corporate practice of medicine).
Infusion therapy services are a specialty form of pharmaceuticals that involve the intravenous administration of higher-cost, specially-handled medications that treat a wide range of acute and chronic health conditions, including, for example, infections, auto-immune illnesses, oncology, multiple sclerosis, hemophilia, and nutritional deficiencies.
Infusion therapy services are a specialty form of pharmaceuticals that involve the intravenous administration of higher-cost, specially-handled medications that treat a wide range of acute and chronic health conditions, including, for example, infections, auto-immune illnesses, multiple sclerosis, hemophilia, and nutritional deficiencies.
Violations of the Anti-Kickback Statute are punishable by imprisonment for up to ten years, fines of up to $100,000 per kickback or both. Larger fines can be imposed upon corporations under the provisions of the U.S. Sentencing Guidelines and the Alternate Fines Statute.
Violations of the Anti-Kickback Statute are punishable by imprisonment for up to ten years, criminal fines of up to $100,000 per kickback or both. Larger fines can be imposed upon corporations under the provisions of the U.S. Sentencing Guidelines and the Alternate Fines Statute.
Home health providers that do not comply with quality data reporting requirements are subject to a 2 percentage point reduction to their market basket update. For our Medicare beneficiaries who have a terminal illness and a life expectancy of six months or less, these patients may elect to receive hospice benefits in lieu of standard Medicare coverage for treatment.
Home health providers that do not comply with quality data reporting requirements are subject to a 2 percentage point reduction to their market basket update. Our Medicare beneficiaries who have a terminal illness and a life expectancy of six months or less may elect to receive hospice benefits in lieu of standard Medicare coverage for treatment.
We see significant potential for additional integrated care opportunities by leveraging our Home-Based Primary Care, CCRx, and Clinical (Nursing) Hub capabilities to support senior living communities, payors, our hospital partners and their patient discharges, and our skilled nursing and rehabilitation facility customers who alone discharge approximately 360,000 patients a year back into the community and their homes.
We see significant potential for additional integrated care opportunities by leveraging our Home-Based Primary Care, CCRx, and Clinical (Nursing) Hub capabilities to support senior living communities, payors, our hospital partners and their patient discharges, and our skilled nursing and rehabilitation facility customers who alone discharge approximately 400,000 patients a year back into the community and their homes.
Moreover, the Company is on a course to digitize as much information as possible and to automate all relevant processes and tasks possible, and we continue to identify opportunities to take advantage of robotic process automation, a discipline we introduced into the Company that has resulted in the automation of many wrote, manual processes, saving time and freeing up employees for higher value-add activities.
Moreover, the Company is on a course to digitize as much information as possible and to automate all relevant processes and tasks possible, and we continue to identify opportunities to take advantage of robotic process automation, a discipline we introduced into the Company that has resulted in the automation of many rote, manual processes, saving time and freeing up employees for higher value-add activities.
In our pharmacy business, patients have an average of nine prescriptions at a given time and are supported by our local pharmacy model that delivers daily services, often within an hour or two, from over 180 pharmacies, infusion centers, and specialty oncology locations across all 50 states.
In our pharmacy business, patients have an average of nine prescriptions at a given time and are supported by our local pharmacy model that delivers daily services, often within an hour or two, from over 175 pharmacies, infusion centers, and specialty oncology locations across all 50 states.
In addition to large finance and human resources organizations, dedicated PMO, IMO, and Procurement teams have been in place for the last eight years and serve as control functions, as they evaluate opportunities, drive continuous improvement projects, and support the execution of critical initiatives across all business and enterprise functions in the Company.
In addition to large finance and human resources organizations, dedicated PMO, IMO, and Procurement teams have been in place for the last nine years and serve as control functions, as they evaluate opportunities, drive continuous improvement projects, and support the execution of critical initiatives across all business and enterprise functions in the Company.
Our model focuses on delivering high-touch and coordinated services to medically complex clients and patients, which is a large, growing, and underserved population in the U.S. healthcare system. These high-need and high-cost Senior and Specialty patients comprise a market of over $1.0 trillion across our business.
Our model focuses on delivering high-touch and coordinated services to medically complex clients and patients, which is a large, growing, and underserved population in the U.S. healthcare system. These high-need and high-cost Senior and Specialty patients comprise a market of over $2.0 trillion across our business.
See “Risk Factors—Risks Related to Our Regulatory Framework.” Anti-Kickback Statute The Anti-Kickback Statute prohibits, among other things, knowingly and willfully offering, paying, soliciting or receiving remuneration, directly or indirectly, in cash or kind, to induce or reward either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under federal and state healthcare programs such as Medicare and Medicaid.
See “Risk Factors—Risks Related to Our Regulatory Framework.” 13 Table of Contents Anti-Kickback Statute The Anti-Kickback Statute prohibits, among other things, knowingly and willfully offering, paying, soliciting or receiving remuneration, directly or indirectly, in cash or kind, to induce or reward either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under federal and state healthcare programs such as Medicare and Medicaid.
We have continued to invest in the leadership and personnel of our development teams across the organization by growing the number of team resources and broadening its geographic coverage, rolling out new and updated training curriculum and programs, and optimizing the use of time through targeting analytics.
We have continued to invest in the leadership and personnel of our development teams across the organization by growing the number of team resources and broadening their geographic coverage, rolling out new and updated training curriculum and programs, and optimizing the use of time through targeting analytics.
Our home-based primary care has delivered leading quality outcomes, including a hospital readmission rate 35% less than the national average and with acute, chronic, and complex patients served still able to spend 359 days per year at home, more than 7% than the Healthy Days at Home study of 6.6 million Medicare beneficiaries found, which reported that beneficiaries with three or more chronic conditions spent, on average 333.7 days at home.
Our home-based primary care has delivered leading quality outcomes, including a hospital readmission rate 35% less than the national average and with acute, chronic, and complex patients served still able to spend 360 days per year at home, significantly more than the Healthy Days at Home study of 6.6 million Medicare beneficiaries found, which reported that beneficiaries with three or more chronic conditions spent, on average, 333.7 days at home.
Non-adherence causes approximately 40% of chronic disease treatment failures and 125,000 deaths per year in the United States. Further, non-adherence costs $100 billion annually, according to the JAMDA study. We deliver on our goals with 99.99% order accuracy and 98.63% order completeness. There are numerous success factors that we believe are important for long-term sustainability in the pharmacy industry.
Non-adherence causes approximately 40% of chronic disease treatment failures and 125,000 deaths per year in the United States. Further, non-adherence costs $100 billion annually, according to the JAMDA study. We deliver on our goals with 99.99% order accuracy and 99.34% order completeness. There are numerous success factors that we believe are important for long-term sustainability in the pharmacy industry.
Continued enhancements in revenue cycle systems and processes have included a 7 Table of Contents new accounts receivable collections system to prioritize accounts and team activity and drive DSOs, implementation of our “One Touch” billing and collections program in pharmacy (to comparatively outperform for customers in a complicated industry billing environment using dedicated billing specialists assigned to facilities to proactively lower costs and optimize customer experiences), lockbox capability, and online bill pay.
Continued enhancements in revenue cycle systems and processes have included a new accounts receivable collections system to prioritize accounts and team activity and drive DSOs, implementation of our “One Touch” billing and collections program in pharmacy (to comparatively outperform for customers in a complicated industry billing environment using dedicated billing specialists assigned to facilities to proactively lower costs and optimize customer experiences), lockbox capability, and online bill pay.
We are continuing to broaden existing relationships that we have with nursing and other professional schools and build out more internal career pathways and talent pipeline programs (e.g., internships, high potential, and international programs) to each of our service lines to grow the pool of available, qualified candidates for rewarding professions and create higher-paying jobs for people through career paths.
We are 12 Table of Contents continuing to broaden existing relationships that we have with nursing and other professional schools and build out more internal career pathways and talent pipeline programs (e.g., internships, high potential, and international programs) to each of our service lines to grow the pool of available, qualified candidates for rewarding professions and create higher-paying jobs for people through career paths.
Employee and vendor initiatives have included payroll and accounts payable systems enhancements and conversions to automate field and people processes, a new enterprise recruiting, hiring and onboarding system, enhanced training systems and programs, introduction of an employee App, or OutReach, that also includes capability for employees to receive daily pay, and a new enterprise travel system to implement policy controls and bulk purchasing for better rates.
Employee and vendor initiatives have included payroll and accounts payable systems 7 Table of Contents enhancements and conversions to automate field and people processes, a new enterprise recruiting, hiring and onboarding system, enhanced training systems and programs, introduction of an employee App, or OutReach, that also includes capability for employees to receive daily pay, and a new enterprise travel system to implement policy controls and bulk purchasing for better rates.
Our rates are competitive with those of other local providers. We bill our private pay consumers for services rendered weekly, bi-monthly or monthly. Other private payors include workers’ compensation programs/insurance, preferred provider organizations, and employers. Supply Historically, in our Pharmacy Solutions segment, we have purchased most of the generic and brand pharmaceuticals that we dispense through wholesaler and GPO agreements.
Our rates are competitive with those of other local providers. We bill our private pay consumers for services rendered weekly, bi-monthly or monthly. Other private payors include workers’ compensation programs/insurance, preferred provider organizations, and employers. Supply In our Pharmacy Solutions segment, we have purchased some of the generic and brand pharmaceuticals that we dispense through wholesaler and GPO agreements.
Our services reduce cost by providing care for many of these individuals in non-institutional home and community settings and reducing hospitalizations. For example, across our pharmacies, we achieve 99.99% order accuracy and 98.63% order completeness, “excellent” and “world class” NPS, and a reduction in hospitalizations with CCRx, while also driving savings through medication adherence and therapeutic interchanges.
Our services reduce cost by providing care for many of these individuals in non-institutional home and community settings and reducing hospitalizations. For example, across our pharmacies, we achieve 99.99% order accuracy and 99.34% order completeness, “excellent” and “world class” NPS, and a reduction in hospitalizations with CCRx, while also driving savings through medication adherence and therapeutic interchanges.
As a result of the CARES Act and subsequent legislation, the 2% aggregated reductions to Medicare payments will remain in effect through 2032. In March 2020, ONC and CMS issued complementary new rules that are intended to clarify provisions of the Cures Act regarding interoperability and information blocking and create significant new requirements for healthcare industry participants.
As a result of the CARES Act and subsequent legislation, the 2% aggregated reductions to Medicare payments will remain in effect through 2032. 19 Table of Contents In March 2020, ONC and CMS issued complementary new rules that are intended to clarify provisions of the Cures Act regarding interoperability and information blocking and create significant new requirements for healthcare industry participants.
We believe the team we have built across the Company, including managers and all of our dedicated clinicians, caregivers, employees, managers, and leaders, are the critical elements that have enabled us to build an industry leading and differentiated healthcare platform.
We believe the team we have built across the Company, including managers and our dedicated clinicians, caregivers, employees, managers, and leaders, are the critical elements that have enabled us to build an industry leading and differentiated healthcare platform.
We receive substantially all of our Provider Services clients and patients through third-party referrals, including from healthcare providers, such as physicians, hospitals, skilled nursing and rehabilitation facilities, assisted living facilities, state, county and city departments on aging, rehabilitation, mental health, behavioral health, and social services, MCOs, and other healthcare and social services providers, discharge planners, and case managers.
We receive substantially all of our Provider Services clients and patients through third-party referrals, including from healthcare providers, such as physicians, hospitals, skilled nursing and 8 Table of Contents rehabilitation facilities, assisted living facilities, state, county and city departments on aging, rehabilitation, mental health, behavioral health, and social services, MCOs, and other healthcare and social services providers, discharge planners, and case managers.
The SEC also maintains a website (www.sec.gov) where you can search for annual, quarterly and current reports, proxy and information statements and other information regarding us and other public companies. 21 Table of Contents
The SEC also maintains a website (www.sec.gov) where you can search for annual, quarterly and current reports, proxy and information statements and other information regarding us and other public companies. 20 Table of Contents
Medicaid prescription drug coverage and reimbursement varies by state and is based on the ingredient cost of the drug, which may depend on factors such as a drug’s acquisition cost and average sale price, and a professional dispensing fee, which may vary based on the type of medication (e.g., brand, generic, specialty, compounded medication) and other factors, such as annual prescription volume.
Medicaid prescription drug coverage and reimbursement varies by state and is based on the 10 Table of Contents ingredient cost of the drug, which may depend on factors such as a drug’s acquisition cost and average sale price, and a professional dispensing fee, which may vary based on the type of medication (e.g., brand, generic, specialty, compounded medication) and other factors, such as annual prescription volume.
Within the last two years, the Company has built a Clinical (Nursing) Hub to be the contact and coordination point for patients, families, and their pharmacy and provider services.
Within the last three years, the Company has built a Clinical (Nursing) Hub to be the contact and coordination point for patients, families, and their pharmacy and provider services.
If CMS or other regulatory or enforcement authorities determine that claims have been submitted for referrals by us that violate the Stark Law, we would be subject to the penalties described above. CMS and the HHS OIG published final regulations that established exceptions to the Stark Law for certain value-based compensation arrangements between or among physicians, providers, and suppliers.
If CMS or other regulatory or enforcement authorities determine that claims have been submitted for referrals by us that violate the Stark Law, we would be subject to the penalties described above. 14 Table of Contents CMS and the HHS OIG published final regulations that established exceptions to the Stark Law for certain value-based compensation arrangements between or among physicians, providers, and suppliers.
All impermissible uses or 18 Table of Contents disclosures of unsecured PHI are presumed to be breaches unless an exception to the definition of breach applies or the covered entity or business associate establishes that there is a low probability the PHI has been compromised.
All impermissible uses or disclosures of unsecured PHI are presumed to be breaches unless an exception to the definition of breach applies or the covered entity or business associate establishes that there is a low probability the PHI has been compromised.
For example, on July 15, 2020, the Substance Abuse and Mental Health Services Administration, or SAMHSA, issued a final rule on the protection of substance use disorder, or SUD, treatment records under 42 C.F.R. Part 2, or the Part 2 Rule.
For example, on July 15, 2020, the 18 Table of Contents Substance Abuse and Mental Health Services Administration, or SAMHSA, issued a final rule on the protection of substance use disorder, or SUD, treatment records under 42 C.F.R. Part 2, or the Part 2 Rule.
In addition to our very strong service delivery metrics, our pharmacy services and proprietary programs reduce drug costs to customers and patients, for example with a 99.93% generic efficiency rate (the percent of drugs dispensed as generic, when both brand and generic versions of a drug are available) and saving customers an average of $58 per therapeutic interchange.
In addition to our very strong service delivery metrics, our pharmacy services and proprietary programs reduce drug costs to customers and patients, for example with a 99.95% generic efficiency rate (the percent of drugs dispensed as generic, when both brand and generic versions of a drug are available) and saving customers an average of $88 per therapeutic interchange.
Our primary care clinicians, including physicians we directly employ in certain states, optimize clinical and care decisions as they see and manage both Seniors and Behavioral (including I/DD) patients in senior living communities, in individual homes and in group homes, in skilled nursing and rehabilitation facilities, as well as through transitional care visits after patients leave hospitals or skilled nursing facilities.
Our primary care clinicians, including physicians we directly employ in certain states, optimize clinical and care decisions as they see and manage both Seniors and Behavioral (including I/DD) patients in senior living communities, in individual homes and in group homes, in skilled nursing and rehabilitation facilities, as well 5 Table of Contents as through transitional care visits after patients leave hospitals or skilled nursing facilities.
If an organization intends to use personal information for another purpose, it must again obtain that individual’s consent. Failure to comply with PIPEDA could result in significant fines and penalties. 19 Table of Contents Data privacy and security laws and regulations are often contradictory and subject to change or differing and evolving interpretations.
If an organization intends to use personal information for another purpose, it must again obtain that individual’s consent. Failure to comply with PIPEDA could result in significant fines and penalties. Data privacy and security laws and regulations are often contradictory and subject to change or differing and evolving interpretations.
This transition is due to an overall desire to better manage the costs of the Medicaid long-term care programs. In addition, hospice and home health services are 10 Table of Contents also reimbursed by MCOs in some states.
This transition is due to an overall desire to better manage the costs of the Medicaid long-term care programs. In addition, hospice and home health services are also reimbursed by MCOs in some states.
We continue to invest in quality and compliance resources with 207 enterprise oversight quality and compliance team members, who conduct approximately 200 additional, deep, and next-level audits annually, in addition to ongoing audits at the field operations level. This team also completes monthly record reviews of patient charts, leveraging electronic health records.
We continue to invest in quality and compliance resources with 208 enterprise oversight quality and compliance team members, who conduct approximately 350 additional, deep, and next-level audits annually, in addition to ongoing audits at the field operations level. This team also completes monthly record reviews of patient charts, leveraging electronic health records.
Our culture is at the heart of all we do, enabling execution of 6 Table of Contents our strategies. Our commitment and passion for making a difference and helping people guides the way our care and services are delivered, one patient at a time.
Our culture is at the heart of all we do, enabling execution of our strategies. Our commitment and passion for making a difference and helping people guides the way our care and services are delivered, one patient at a time.
These changes in federal regulations are anticipated to have a significant impact on healthcare providers and other stakeholders. In addition, we anticipate that additional changes will continue to be proposed in the future. 20 Table of Contents Other Regulations Our operations are subject to various state hazardous waste and non-hazardous medical waste disposal laws.
These changes in federal regulations are anticipated to have a significant impact on healthcare providers and other stakeholders. In addition, we anticipate that additional changes will continue to be proposed in the future. Other Regulations Our operations are subject to various state hazardous waste and non-hazardous medical waste disposal laws.
We achieve 97% patient satisfaction in our outpatient rehab services, an 85% overall rating of care in hospice, and, as reported by the Agency for Healthcare 1 Table of Contents Research and Quality, hospitalizations that are 35% lower than the national average in our home-based primary care.
We achieve 100% patient satisfaction in our outpatient rehab services, an 87% overall rating of care in hospice, and, as reported by the Agency for Healthcare 1 Table of Contents Research and Quality, hospitalizations that are 35% lower than the national average in our home-based primary care.
Our service capabilities extend across all 50 states in the United States, with co-location of our pharmacy and provider services in 40 states. We deliver a higher proportion of services in select regions with favorable demographics and regulatory environments, with approximately 47% of our revenue in 10 states for the year ended December 31, 2024.
Our service capabilities extend across all 50 states in the United States, with co-location of our pharmacy and provider services in 40 states. We deliver a higher proportion of services in select regions with favorable demographics and regulatory environments, with approximately 53% of our revenue in 10 states for the year ended December 31, 2025.
See “Risk Factors—Risks Related to Our Business.” 8 Table of Contents Sales and Marketing In our Pharmacy Solutions segment, potential referral sources and customers include physicians and specialists (prescribers), hospitals, senior living providers, behavioral (I/DD and other) providers, hospice providers, skilled nursing and rehabilitation providers, pharmaceutical manufacturers, and other health providers.
See “Risk Factors—Risks Related to Our Business.” Sales and Marketing In our Pharmacy Solutions segment, potential referral sources and customers include physicians and specialists (prescribers), hospitals, senior living providers, behavioral (I/DD and other) providers, hospice providers, skilled nursing and rehabilitation providers, pharmaceutical manufacturers, and other health providers.
In addition, the 15 Table of Contents government may assert that a claim including items or services resulting from a violation of the Anti-Kickback the Statute or Stark Law constitutes a false or fraudulent claim for purposes of the False Claims Act.
In addition, the government may assert that a claim including items or services resulting from a violation of the Anti-Kickback Statute or Stark Law constitutes a false or fraudulent claim for purposes of the False Claims Act.
Many of our provider patients also receive their pharmacy services through the Company, which helps to optimize their pharmacy and medication care and needs, simplify their experience, and improve their satisfaction. Our patient personal care satisfaction score for provider services patients was 4 Table of Contents 4.54 out of 5.0, per an internal survey.
Many of our provider patients also receive their pharmacy services through the Company, which helps to optimize their pharmacy and medication care and needs, simplify their experience, and improve their satisfaction. Our patient personal care satisfaction score for provider services patients was 4.59 out of 5.0, per an internal survey.
To this end, the Company has endeavored to build out home-based primary care over the last several years to coordinate patient services. There are numerous success factors that we believe are important for long-term sustainability in our provider services markets.
To this end, the Company has endeavored to build out home-based primary care over the last several years to coordinate patient services. 4 Table of Contents There are numerous success factors that we believe are important for long-term sustainability in our provider services markets.
We have specifically focused on and built a fast, local, and “white-glove” delivery model that is supported by expert clinical teams in the field, which fulfilled over 41 million prescriptions in 2024 across customer and patient settings and types.
We have specifically focused on and built a fast, local, and “white-glove” delivery model that is supported by expert clinical teams in the field, which fulfilled over 43 million prescriptions in 2025 across customer and patient settings and types.
“Designated health services” include clinical laboratory services, inpatient and outpatient hospital services, physical and occupational therapy services, outpatient speech-language pathology services, certain radiology services, radiation therapy services and supplies, 14 Table of Contents durable medical equipment and supplies, parenteral and enteral nutrients equipment and supplies, prosthetics, orthotics and prosthetic devices and supplies, home health services, and outpatient prescription drugs.
“Designated health services” include clinical laboratory services, inpatient and outpatient hospital services, physical and occupational therapy services, outpatient speech-language pathology services, certain radiology services, radiation therapy services and supplies, durable medical equipment and supplies, parenteral and enteral nutrients equipment and supplies, prosthetics, orthotics and prosthetic devices and supplies, home health services, and outpatient prescription drugs.
In our infusion and specialty pharmacy services, owners of senior living and skilled nursing and rehabilitation facilities may also provide pharmacy (and provider) services, and on a nationwide basis we compete with Omnicare, Inc., a division of CVS Health, and several others.
In our home and community pharmacy services, owners of senior living and skilled nursing and rehabilitation facilities may also provide pharmacy (and provider) services, and on a nationwide basis we compete with Omnicare, Inc., a division of CVS Health, and several others.
The implementation of our PMO-led continuous improvement program over the past eight years at the enterprise level has resulted in approximately $67.5 million of annual savings in 2024 (in addition to annual efficiencies and savings work throughout field operations) from improved processes and working smarter, and these efficiencies have been used to reinvest in employees (both existing employees through wages and benefits and new employees to support key strategies, innovation and infrastructure needs to further scale), quality, technology, and growth initiatives.
The implementation of our PMO-led continuous improvement program over the past nine years at the enterprise level has resulted in approximately $84.7 million of annual savings in 2025 (in addition to annual efficiencies and savings work throughout field operations) from improved processes and working smarter, and these efficiencies have been used to reinvest in employees (both existing employees through wages and benefits and new employees to support key strategies, innovation and infrastructure needs to further scale), quality, technology, and growth initiatives.
Patients who receive our provider services average six chronic conditions per patient, and we delivered approximately 19 million hours of quality and compassionate care in 2024 to home health, hospice, rehab, and home care patients and clients.
Patients who receive our provider services average six chronic conditions per patient, and we delivered approximately 21 million hours of quality and compassionate care in 2025 to home health, hospice, rehab, and home care patients and clients.
We have an 9.3 HCI score, calculated using data from CMS provider reports for each of our providers, and we believe that our nurse-to-patient visit frequency and staffing ratio is well above industry averages, as demonstrated by the fact that across our hospice services, our average total visits per patient is 17.1 visits per month as compared to the national average of 15.6 visits per month.
We have a 9.4 HCI score, calculated using data from CMS provider reports for each of our providers, and we believe that our nurse-to-patient visit frequency and staffing ratio is well above industry averages, as demonstrated by the fact that across our hospice services, our average total visits per patient is 16.9 visits per month as compared to the national average of 15.6 visits per month.
Hospice services are paid by Medicare as a daily rate for each day a patient is enrolled in the hospice benefit. Hospice payment rates increased by 2.9% for federal fiscal year 2025, which reflects a 3.4% market basket update with a 0.5% productivity reduction. CMS requires various providers, including hospice providers, to submit quality reporting data each year.
Hospice services are paid by Medicare as a daily rate for each day a patient is enrolled in the hospice benefit. Hospice payment rates increased by 2.6% for federal fiscal year 2026, which reflects a 3.3% market basket update with a 0.7% productivity reduction. CMS requires various providers, including hospice providers, to submit quality reporting data each year.
Sanctions for violation of the Stark Law include denial of payment for claims for services provided in violation of the prohibition, refunds of amounts collected in violation of the prohibition, a civil penalty of up to $27,750 for each service arising out of the prohibited referral, a civil penalty of up to $185,009 against parties that enter into a scheme to circumvent the Stark Law prohibition, civil assessment of up to three times the amount claimed and potential exclusion from the federal healthcare programs, including Medicare and Medicaid.
Sanctions for violation of the Stark Law include denial of payment for claims for services provided in violation of the prohibition, refunds of amounts collected in violation of the prohibition, a civil penalty of up to $29,899 for each service arising out of the prohibited referral, a civil penalty of up to $199,338 against parties that enter into a scheme to circumvent the Stark Law prohibition, civil assessment of up to three times the amount claimed and potential exclusion from the federal healthcare programs, including Medicare and Medicaid.
Our presence spans all 50 states, we serve over 450,000 patients daily through our approximately 11,000 clinical providers and pharmacists, and our services make a profound impact in the lives and communities of the people we serve.
Our presence spans all 50 states, we serve over 465,000 patients daily through our approximately 10,500 clinical providers and pharmacists, and our services make a profound impact in the lives and communities of the people we serve.
Infusion and Specialty Pharmacy prescriptions and Home and Community Pharmacy prescriptions have grown at more than 22% and 11%, respectively, from December 2023 to December 2024. We have a unique opportunity to increasingly provide more pharmacy services in the future to provider patients and patients transitioning across settings of care.
Infusion and Specialty Pharmacy prescriptions and Home and Community Pharmacy prescriptions have grown at more than 27% and 3%, respectively, from December 2024 to December 2025. We have a unique opportunity to increasingly provide more pharmacy services in the future to provider patients and patients transitioning across settings of care.
The Company expects the divestiture to close in 2025, subject to customary closing conditions. This transaction provides for continuity of important intellectual and developmental disability services while BrightSpring focuses on a concentrated group of customers, patients and stakeholders in the future.
The Company expects the divestiture to close in the first fiscal quarter of 2026, subject to customary closing conditions. This transaction provides for continuity of important intellectual and developmental disability services while the Company focuses on a concentrated group of customers, patients and stakeholders in the future.
For example, we have had approximately 68% retention of clinical positions in home health care, hospice care, and rehab care from December 31, 2023 to December 31, 2024.
For example, we have had approximately 70% retention of clinical positions in home health care, hospice care, and rehab care from December 31, 2024 to December 31, 2025.
For calendar year 2024, HH PPS rates increased by 0.7%, which reflects a 4.1% market basket update, reduced by a multifactor productivity adjustment of 0.1% as well as permanent adjustments through authority CMS retains to achieve budget neutrality of the new PDGM system through calendar year 2026.
For calendar year 2025, HH PPS rates increased by 2.7%, which reflects a 3.2% market basket update, reduced by a multifactor productivity adjustment of 0.5% as well as permanent adjustments through authority CMS retains to achieve budget neutrality of the new PDGM system through calendar year 2026.
Americans with five or more chronic conditions make up over 10% of the population and account for 40% of total health care spending, on average spending 10 times more on health services than those without chronic conditions.
Americans with five or more chronic conditions make up over 12% of the population and account for 41% of total health care spending, on average spending 14 times more on health services than those without chronic conditions.
Additionally, on average, nursing visits per patient per month was 8.2 as compared to the national average of 6.8 visits per patient per month, which monthly average was based on a MedPac report in 2024.
Additionally, on average, nursing visits per patient per month was 8.0 as compared to the national average of 7.2 visits per patient per month, which monthly average was based on a MedPac report in 2025.
Combined, our daily pharmacy and provider services are delivered from and to approximately 11,300 office, clinic, and customer locations across the country, with over 450,000 patients serviced at any one time, including approximately 300,000 patients served in their homes at any one time.
Combined, our daily pharmacy and provider services are delivered from and to approximately 7,700 office, clinic, and customer locations across the country, with over 465,000 patients serviced at any one time, including approximately 330,000 patients served in their homes at any one time.
The incentive program has reached its conclusion. Further, there are meaningful new opportunities, such as $90 billion expected by 2032 in pharmaceutical industry revenue from oncology drugs not yet launched, drugs that will become generic over the next five years, and approximately 400 drug therapies in Phase III in the Infusion and Specialty Pharmacy pipeline.
Further, there are meaningful new opportunities, such as $90 billion expected by 2032 in pharmaceutical industry revenue from oncology drugs not yet launched, drugs that will become generic over the next five years, and over 415 drug therapies in Phase III in the Infusion and Specialty Pharmacy pipeline.
In federal fiscal years 2024 and 2025, the aggregate caps are $33,494.01 and $34,465.34 , respectively. Our pharmacy services for eligible Medicare patients are reimbursed through the Medicare Part D program, which makes prescription drug coverage available to eligible Medicare beneficiaries.
In federal fiscal years 2025 and 2026, the aggregate caps are $34,465.34 and $35,361.44, respectively. Our pharmacy services for eligible Medicare patients are reimbursed through the Medicare Part D program, which makes prescription drug coverage available to eligible Medicare beneficiaries.
Hospices that do not satisfy quality reporting requirements are subject to a 2 percentage point reduction to the market basket percentage update. Additionally, hospice companies are subject to two specific payment limit caps under the Medicare program each federal fiscal year: the inpatient cap and the aggregate cap.
Hospices that do not satisfy quality reporting requirements are subject to a 2 percentage point reduction to the market basket percentage update. Additionally, hospice companies are subject to two specific Medicare payment caps each hospice cap year (November 1 - October 31): the inpatient cap and the aggregate cap.
The inpatient cap limits the number of inpatient care days provided to no more than 20% of the total days of hospice care provided to Medicare patients for the year.
The inpatient cap limits the number of inpatient care days (general inpatient and inpatient respite) for Medicare patients to no more than 20% of the total days of hospice care furnished to Medicare patients during the cap year.
Civil penalties for violation of the Anti-Kickback Statute include up to $112,131 in monetary penalties per violation, repayments of up to three times the total payments between the parties to the arrangement and potential exclusion from participation in Medicare and Medicaid.
Civil penalties for violation of the Anti-Kickback Statute include up to $127,973 in monetary penalties per violation, repayments of up to three times the amount of the remuneration between the parties and potential exclusion from participation in Medicare and Medicaid.
All of our operations must comply with the extensive conditions of participation in the Medicare program in order to continue receiving Medicare reimbursement. 9 Table of Contents For our patients and clients that receive certain home health benefits, effective January 1, 2020, CMS transitioned to 30-day periods of care within each 60-day certification of patient eligibility period and implemented the Patient-Driven Groupings Model, or PDGM, as the payment model for services provided to Medicare patients with dates of service on or after January 1, 2020.
For our patients and clients that receive certain home health benefits, effective January 1, 2020, CMS transitioned to 30-day periods of care within each 60-day certification of patient eligibility period and implemented the Patient-Driven Groupings Model, or PDGM, as the payment model for services provided to Medicare patients with dates of service on or after January 1, 2020.
These services consist of clinical and supportive care to approximately 40,000 Senior and Specialty populations today, with both census for Home Health Care services specifically, and rehab hours served, having grown approximately 9% and 13% from December 2023 to December 2024, respectively.
Following the Community Living divestiture, these services consist of clinical and supportive care to approximately 16,000 Senior and Specialty populations today, with both census for Home Health Care services specifically, and rehab hours served, having grown approximately 9% and 12% from December 2024 to December 2025, respectively.
We use a comprehensive mix of initiatives and tactics to accomplish this, including traditional recruiting resources, traditional media, community events, open houses, job fairs, mailings, digital media candidate lead generation, targeted outreach, and partnerships with job boards, colleges, and non-profits.
A key strategy of the Company is effectively recruiting, attracting, onboarding, and retaining well-qualified and motivated employees. We use a comprehensive mix of initiatives and tactics to accomplish this, including traditional recruiting resources, traditional media, community events, open houses, job fairs, mailings, digital media candidate lead generation, targeted outreach, and partnerships with job boards, colleges, and non-profits.
Our certified oncology pharmacists are available 24/7 to provide support for patients and caregivers while working in close coordination with their physicians. 3 Table of Contents Our customer service and quality metrics are in-line with, or better than, our peers, such as time-to-first-fill (3.6 day average turnaround time, which is significantly lower than the industry average of 9.7 day average turnaround time), overall MPR (93.3%, which is significantly higher than the generally accepted 80% threshold for compliance, which is also the threshold set forth in the Company’s Blue Cross Blue Shield guarantee), and infusion patient satisfaction scores (94.5%, which is in-line with the 95.6% national average).
Our customer service and quality metrics are in-line with, or better than, our peers, such as time-to-first-fill (4.1 day average turnaround time, which is significantly lower than the industry average of 8.5 day average turnaround time), overall MPR (92.4%, 3 Table of Contents which is significantly higher than the generally accepted 80% threshold for compliance, which is also the threshold set forth in the Company’s Blue Cross Blue Shield guarantee), and infusion patient satisfaction scores (94.3%, which is in-line with the 95.6% national average).
Complementary scale in the pharmacy business is additive to provider services quality and growth, as our pharmacy business’ presence and footprint across geographies provide for a base of integrated care patient opportunities. Home Health Care We provide patient-centric, highly skilled, and compassionate clinical care to Seniors and others in their homes.
Complementary scale in the pharmacy business is additive to provider services quality and growth, as our pharmacy business’ presence and footprint across geographies provide for a base of integrated care patient opportunities.
If these audits identify overpayments, we could be required to make substantial repayments, subject to various appeal rights. Several of our facilities have undergone claims audits related to their receipt of payments during the last several years. Liability from audits could potentially exceed established reserves, and any excess could potentially be substantial.
Several of our facilities have undergone claims audits related to their receipt of payments during the last several years. Liability from audits could potentially exceed established reserves, and any excess could potentially be substantial.
We have approximately 600 human resources professionals in the Company supporting our businesses and enterprise functions, in groups and teams spanning recruiting, learning, training, and organizational development, compensation and benefits, leadership development, M&A integration, employee relations, HR compliance, HR information technology, and generalist HR activities and business partners. 12 Table of Contents A key strategy of the Company is effectively recruiting, attracting, onboarding, and retaining well-qualified and motivated employees.
We have approximately 500 human resources professionals in the Company supporting our businesses and enterprise functions, in groups and teams spanning recruiting, learning, training, organizational development, compensation and benefits, leadership development, M&A integration, employee relations, HR compliance, HR information technology, and generalist HR activities and business partners.
The divestiture will also augment the Company’s expected Revenue and Adjusted EBITDA growth rates and maximize exposure to target growth markets that require BrightSpring’s needed and valuable solutions, such as home health, rehab, primary care, and hospice. The Company expects to account for this sale as a strategic shift in fiscal year 2025.
The divestiture will also augment the Company’s expected Revenue and Adjusted EBITDA growth rates and maximize exposure to target growth markets that require the Company's needed and valuable solutions, such as home health, rehab, primary care, and hospice.
Within provider services, we address the clinical and supportive care needs of Senior and Specialty populations, including neuro and Behavioral patients, primarily in their homes, as well as some clinic and community settings.
Within provider services, we address the clinical and supportive care needs of Senior and Specialty populations, including neuro patients, primarily in their homes, as well as some clinic and community settings. Our clinical services consist of home health and hospice and rehab therapy, and our supportive care services address activities of daily living and social determinants of health as well.
The PDGM replaced the case-mix system, which used the number of visits to determine payment, and classified patients based on clinical characteristics. The intent of the PDGM is to shift toward a value-based payment system and remove the incentive to overprovide care. CMS updates the Home Health Prospective Payment System, or HH PPS, payment rates each calendar year.
The PDGM replaced the case-mix system, which used the number of visits to determine payment, and classified patients based on clinical characteristics. The intent of the PDGM is to shift toward a value-based payment system and remove the incentive to overprovide 9 Table of Contents care.
These prohibitions on the corporate practice of medicine are intended to prevent unlicensed persons from interfering with the practice of medicine by licensed physicians or interfering with the independent professional judgment of physicians as it pertains to treatment and related clinical matters. Some states have similar doctrines with respect to other professional licensure categories, including behavioral health services.
These prohibitions on the corporate practice of medicine are intended to prevent unlicensed persons from interfering with the practice of medicine by licensed physicians or interfering with the independent professional judgment of physicians as it pertains to treatment 16 Table of Contents and related clinical matters.
Under the Managed Medicare program (also known as Medicare Part C, or Medicare Advantage), the federal government contracts with private health insurers to provide members with Medicare Part A, Part B and Part D benefits.
Under the Managed Medicare program (also known as Medicare Part C, or Medicare Advantage), the federal government contracts with private health insurers to provide members with Medicare Part A, Part B and Part D benefits. All of our operations must comply with the extensive conditions of participation in the Medicare program in order to continue receiving Medicare reimbursement.
For I/DD patients, we have seen reductions in hospitalizations and readmissions of 44% and 84%, respectively, since beginning home-based primary care services. 5 Table of Contents In addition to many of our provider patients also receiving their pharmacy services from the Company, our patients often receive multiple in-home provider services from the Company to improve outcomes, including home-based primary care and home health or hospice and transitions from home health to hospice.
In addition to many of our provider patients also receiving their pharmacy services from the Company, our patients often receive multiple in-home provider services from the Company to improve outcomes, including home-based primary care and home health or hospice and transitions from home health to hospice.
The Company filled over 41 million prescriptions in 2024 from over 180 pharmacies across all 50 states, with services delivered to approximately 7,100 customer locations, more than 60,000 individual or group homes, and over 400,000 patients, all through over 4,700 unique customer and payor contracts.
The Company filled over 43 million prescriptions in 2025 from over 175 pharmacies across all 50 states, with services delivered to approximately 6,600 customer locations, approximately 73,000 individual or group homes, and over 410,000 patients, all through over 4,500 unique customer and payor contracts.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese provisions provide for, among other things: • a classified board of directors, as a result of which our board of directors is divided into three classes, with each class serving for staggered three-year terms; 54 Table of Contents • the ability of our board of directors to issue one or more series of preferred stock; • advance notice requirements for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings; • certain limitations on convening special stockholder meetings; • the removal of directors only for cause and only upon the affirmative vote of the holders of at least 66 2/3% of the shares of common stock entitled to vote generally in the election of directors if KKR Stockholder, Walgreen Stockholder and their respective affiliates cease to beneficially own, in the aggregate, at least 40% of shares of common stock entitled to vote generally in the election of directors; and • that certain provisions may be amended only by the affirmative vote of at least 66 2/3% of shares of common stock entitled to vote generally in the election of directors if KKR Stockholder, Walgreen Stockholder and their respective affiliates cease to beneficially own, in the aggregate, at least 40% of shares of common stock entitled to vote generally in the election of directors.
Biggest changeThese provisions provide for, among other things: • a classified board of directors, as a result of which our board of directors is divided into three classes, with each class serving for staggered three-year terms; • the ability of our board of directors to issue one or more series of preferred stock; • advance notice requirements for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings; and • certain limitations on convening special stockholder meetings; • the removal of directors only for cause and only upon the affirmative vote of the holders of at least 66 2/3% of the shares of common stock entitled to vote generally in the election of directors; and • that certain provisions may be amended only by the affirmative vote of at least 66 2/3% of shares of common stock entitled to vote generally in the election of directors.
If one or more of our facilities experiences an adverse patient incident or is found to have failed to provide appropriate patient care (including as a result of a staffing shortages or the actions or inactions of our employees or workforce members), governmental or regulatory authorities may take action against us or our employees or workforce members, including an admissions ban, admissions hold, reduction in census, loss of accreditation, license revocation, application denial period, administrative or other order, other adverse regulatory action, a settlement or other agreement requiring corrective actions or requiring us or a specific facility to demonstrate substantial compliance with licensure or other requirements, and the imposition of certain requirements, including requirements to transfer our service users, to provide reports or other documentation or to undergo revisit surveys or inspections.
If one or more of our facilities experiences an adverse patient incident or is found to have failed to provide appropriate patient care (including as a result of staffing shortages or the actions or inactions of our employees or workforce members), governmental or regulatory authorities may take action against us or our employees or workforce members, including an admissions ban, admissions hold, reduction in census, loss of accreditation, license revocation, application denial period, administrative or other order, other adverse regulatory action, a settlement or other agreement requiring corrective actions or requiring us or a specific facility to demonstrate substantial compliance with licensure or other requirements, and the imposition of certain requirements, including requirements to transfer our service users, to provide reports or other documentation or to undergo revisit surveys or inspections.
Our contractual relationships with physicians and professional corporations may be challenged by governmental and regulatory authorities, state boards of medicine, state attorneys general and other parties that assert or determine that our relationships with professional corporations violate state corporate practice of medicine, fee-splitting, and kickback prohibitions.
Our contractual relationships with physicians and professional corporations may be challenged by governmental and regulatory authorities, state boards of medicine, state attorneys general and other parties that assert or determine that our relationships with professional corporations violate state corporate practice of medicine, fee-splitting, and/or kickback prohibitions.
If our existing indebtedness were to be accelerated, there can be no assurance that we would have, or be able to obtain, sufficient funds to repay such indebtedness in full.
If our existing indebtedness were to be accelerated, there can be no assurance that we would have, or be able to obtain, sufficient funds to repay such indebtedness in full.
If our existing indebtedness were to be accelerated, there can be no assurance that we would have, or be able to obtain, sufficient funds to repay such indebtedness in full.
If our existing indebtedness were to be accelerated, there can be no assurance that we would have, or be able to obtain, sufficient funds to repay such indebtedness in full.
Our efforts to comply with these rules and regulations increase our legal and financial compliance costs and to make some activities more time-consuming and costly. Our management devotes a substantial amount of time to ensure that we comply with all of these requirements, diverting the attention of management away from revenue-producing activities.
Our efforts to comply with these rules and regulations increase our legal and financial compliance costs and make some activities more time-consuming and costly. Our management devotes a substantial amount of time to ensure that we comply with all of these requirements, diverting the attention of management away from revenue-producing activities.
Changes that may occur at the federal or state level include: • administrative or legislative changes to the base rates under the applicable prospective payment systems; • the reduction or elimination of annual rate increases; • redefining eligibility or enrollment standards or coverage criteria for government healthcare programs or the receipt of services under those programs or changes in documentation requirements; • the imposition of prior authorization and concurrent utilization review programs that may further limit the services for which government healthcare programs will pay and shift patients to lower levels of care and reimbursement; • the imposition or increase of mechanisms shifting more responsibility for a portion of payment to beneficiaries, such as co-payments; • adjustments to the relative components of the wage index used in determining reimbursement rates; • decreasing benefits, such as limiting the number of hours of personal care services that will be covered; • changing reimbursement methodology; • slowing payments to providers; • increasing utilization of self-directed care alternatives or “all inclusive” programs; • changes to cap limits and per diem rates; • changes to case mix or therapy thresholds; 23 Table of Contents • the reclassification of home health resource groups; and • the reclassification of long-term care diagnosis-related groups.
Changes that may occur at the federal or state level include: • administrative or legislative changes to the base rates under the applicable prospective payment systems; • the reduction or elimination of annual rate increases; • redefining eligibility or enrollment standards or coverage criteria for government healthcare programs or the receipt of services under those programs or changes in documentation requirements; • the imposition of prior authorization and concurrent utilization review programs that may further limit the services for which government healthcare programs will pay and shift patients to lower levels of care and reimbursement; • the imposition or increase of mechanisms shifting more responsibility for a portion of payment to beneficiaries, such as co-payments; • adjustments to the relative components of the wage index used in determining reimbursement rates; • decreasing benefits, such as limiting the number of hours of personal care services that will be covered; • changing reimbursement methodology; • slowing payments to providers; • increasing utilization of self-directed care alternatives or “all inclusive” programs; • changes to cap limits and per diem rates; • changes to case mix or therapy thresholds; • the reclassification of home health resource groups; and 22 Table of Contents • the reclassification of long-term care diagnosis-related groups.
If we fail to comply with the extensive laws, regulations, and prohibitions applicable to our businesses, we could become ineligible or disqualified to provide services or receive government program reimbursement, suffer suspension or revocation of our licenses, cancellation of our agreements, civil or criminal penalties, and/or damage to our reputation, lose billing privileges, be barred from re-enrollment in governmental payor programs, or be required to repay amounts received or to make significant changes to our operations.
If we fail to comply with the extensive laws, regulations, and prohibitions applicable to our businesses, we could become ineligible or disqualified to provide services or receive government program reimbursement, suffer suspension or revocation of our licenses, cancellation of our agreements, civil or criminal penalties, litigation, and/or damage to our reputation, lose billing privileges, be barred from re-enrollment in governmental payor programs, or be required to repay amounts received or to make significant changes to our operations.
Complying with these various laws, rules, regulations, and standards, and with any new laws or regulations changes to existing laws, could cause us to incur substantial costs that are likely to increase over time, require us to change our business practices in a manner adverse to our business, divert resources from other initiatives and projects, and restrict the way products and services involving data are offered, all of which may have a material adverse effect on our business.
Complying with these various laws, rules, regulations, and standards, and with any new laws or regulation changes to existing laws, could cause us to incur substantial costs that are likely to increase over time, require us to change our business practices in a manner adverse to our business, divert resources from other initiatives and projects, and restrict the way products and services involving data are offered, all of which may have a material adverse effect on our business.
Many of these statutes and regulations have not been interpreted to the extent of their federal analogues, and therefore are not clear in their scope and application; • state corporate practice of medicine and fee-splitting laws that prohibit general business corporations, such as us, from practicing medicine, controlling physicians’ medical decisions or engaging in some practices such as splitting fees with physicians; • laws that regulate debt collection practices; • a provision of the Social Security Act that imposes criminal penalties on healthcare providers who fail to disclose, or refund known overpayments; • federal and state laws that prohibit providers from billing and receiving payment from Medicare and Medicaid for services unless the services are medically necessary, adequately and accurately documented, and billed using codes that accurately reflect the type and level of services rendered; • federal and state laws that require licenses to dispense pharmaceuticals, including state laws that restrict operations by non-resident pharmacies, which may affect our ability to operate in some states; and • federal and state laws and policies that require healthcare providers to maintain licensure, certification or accreditation to enroll and participate in the Medicare and Medicaid programs, and to report certain changes in their operations to the agencies that administer these programs.
Many of these statutes and regulations have not been interpreted to the extent of their federal analogues, and therefore are not clear in their scope and application; • state corporate practice of medicine and fee-splitting laws that prohibit general business corporations, such as us, from practicing medicine, controlling physicians’ medical decisions or engaging in some practices such as splitting fees with physicians; • laws that regulate debt collection practices; • a provision of the Social Security Act that imposes criminal penalties on healthcare providers who fail to disclose, or refund known overpayments; • federal and state laws that prohibit providers from billing and receiving payment from Medicare and Medicaid for services unless the services are medically necessary, adequately and accurately documented, and billed using codes that accurately reflect the type and level of services rendered; • federal and state laws that require licenses to dispense pharmaceuticals, including state laws that restrict operations by non-resident pharmacies, which may affect our ability to operate in some states; and 42 Table of Contents • federal and state laws and policies that require healthcare providers to maintain licensure, certification or accreditation to enroll and participate in the Medicare and Medicaid programs, and to report certain changes in their operations to the agencies that administer these programs.
As part of the efforts, such payors are increasingly demanding discounted fee structures or the assumption by healthcare providers of all or a portion of the financial risk relating to paying for care provided, often in exchange for exclusive or preferred participation in their benefit plans.
As part of the efforts, such payors are demanding discounted fee structures or the assumption by healthcare providers of all or a portion of the financial risk relating to paying for care provided, often in exchange for exclusive or preferred participation in their benefit plans.
If we are not able to continue to streamline our processes and reduce our costs, our business, financial condition, and results of operations could be materially adversely affected. Delays in collection or non-collection of our accounts receivable, particularly during the business integration process, could adversely affect our business, financial condition, and results of operations.
If we are not able to streamline our processes and reduce our costs, our business, financial condition, and results of operations could be materially adversely affected. Delays in collection or non-collection of our accounts receivable, particularly during the business integration process, could adversely affect our business, financial condition, and results of operations.
In general, we coordinate care for high-need, medically complex individuals through employed clinicians, caregivers, and pharmacists, including registered nurses, limited practice nurses, licensed therapists, certified nursing assistants, home health aides, therapy assistants, direct care staff, and other similar professionals.
In general, we coordinate care for high-need, medically complex individuals through employed clinicians, caregivers, and pharmacists, including physicians, registered nurses, limited practice nurses, licensed therapists, certified nursing assistants, home health aides, therapy assistants, direct care staff, and other similar professionals.
We cannot assure you that the insurance we maintain will satisfy claims made against us or that insurance coverage will continue to be available to us at commercially reasonable rates, in adequate amounts or on satisfactory terms, if at all.
We cannot assure you that the insurance we maintain will cover or satisfy claims made against us or that insurance coverage will continue to be available to us at commercially reasonable rates, in adequate amounts or on satisfactory terms, if at all.
The Inflation Reduction Act of 2022, or IRA, includes several provisions that may impact our business to varying degrees, including provisions that reduce the out-of-pocket spending cap for Medicare Part D beneficiaries from $7,050 to $2,000 starting in 2025, thereby effectively eliminating the coverage gap; impose new manufacturer financial liability on certain drugs under Medicare Part D, allow the U.S. government to negotiate Medicare Part B and Part D price caps for certain high-cost drugs and biologics without generic or biosimilar competition; require companies to pay rebates to Medicare for certain drug prices that increase faster than inflation; and delay until January 1, 2032, the implementation of the HHS Rebate Rule that would have limited the fees that pharmacy benefit managers can charge.
The Inflation Reduction Act of 2022, or IRA, includes several provisions that may impact our business to varying degrees, including provisions that reduce the out-of-pocket spending cap for Medicare Part D beneficiaries to $2,000 starting in 2025, thereby effectively eliminating the coverage gap; impose new manufacturer financial liability on certain drugs under Medicare Part D, allow the U.S. government to negotiate Medicare Part B and Part D price caps for certain high-cost drugs and biologics without generic or biosimilar competition; require companies to pay rebates to Medicare for certain drug prices that increase faster than inflation; and delay until January 1, 2032, the implementation of the HHS Rebate Rule that would have limited the fees that pharmacy benefit managers can charge.
Our second amended and restated certificate of incorporation provides that unless we consent to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or if such court does not have jurisdiction, another state or the federal courts (as appropriate) located within the State of Delaware) will, to the fullest extent permitted by law, be the sole and exclusive forum for any (i) derivative action or proceeding brought on behalf of our Company, (ii) action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, or other employee or stockholder of our Company to the Company or our stockholders, creditors, or other constituents, (iii) action asserting a claim against the Company or any current or former director or officer of the Company arising pursuant to any provision of the Delaware General Corporation Law, or the DGCL, or our second amended and restated certificate of incorporation or our amended and restated bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware, or (iv) action asserting a claim governed by the internal affairs doctrine.
Our second amended and restated certificate of incorporation provides that unless we consent to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or if such court does not have jurisdiction, another state or the federal courts (as appropriate) located within the State of Delaware) will, to the fullest extent permitted by law, be the sole and exclusive forum for 53 Table of Contents any (i) derivative action or proceeding brought on behalf of our Company, (ii) action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, or other employee or stockholder of our Company to the Company or our stockholders, creditors, or other constituents, (iii) action asserting a claim against the Company or any current or former director or officer of the Company arising pursuant to any provision of the Delaware General Corporation Law, or the DGCL, or our second amended and restated certificate of incorporation or our amended and restated bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware, or (iv) action asserting a claim governed by the internal affairs doctrine.
Additionally, CMS changed the Home Health Prospective Payment System case-mix adjustment methodology through the use of a new Patient-Driven Groupings Model, or PDGM, for home health payments.
Additionally, CMS changed the Home Health Prospective Payment System case-mix adjustment methodology through the use of a Patient-Driven Groupings Model, or PDGM, for home health payments.
If we are found to have violated HIPAA, or any other applicable privacy and security laws and regulations, as well as contractual obligations, we could be subject to sanctions, fines, damages and other additional civil or criminal penalties, which could increase our liabilities, harm our reputation and have a material adverse effect on our business, financial condition and results of operation.
If we are found to have violated HIPAA, or any other applicable privacy and security laws and regulations, as well as contractual obligations, we could be subject to sanctions, fines, damages and other additional civil or criminal penalties, which could increase our liabilities, harm our reputation and have a material adverse effect on our business, financial condition and results of operations.
Future changes to the use of AWP, WAC or to other published pricing benchmarks used to establish drug pricing, including changes in the basis for calculating reimbursement by federal and state healthcare programs and/or other payors, could impact the reimbursement we receive from Medicare and Medicaid programs, the reimbursement we receive from our PBM, clients, and other payors, and/or our ability to negotiate rebates and/or discounts with drug manufacturers and wholesalers.
Future changes to the use of AWP, WAC or to other published pricing benchmarks used to establish drug pricing, including changes in the basis for calculating reimbursement by federal and state healthcare programs and/or other payors, could impact the reimbursement we receive from Medicare and Medicaid programs, the reimbursement we receive from our PBMs, clients, and other payors, and/or our ability to negotiate rebates and/or discounts with drug manufacturers and wholesalers.
In addition, some of our competitors have vertically integrated business models with commercial payors, or are under common control with, or owned by, pharmaceutical wholesalers and distributors, Managed Care Organizations, or MCOs, PBMs, or retail pharmacy chains and may be better positioned with respect to the cost-effective distribution of pharmaceuticals.
In addition, some of our competitors have vertically integrated business models with commercial payors, or are under common control with, or owned by, pharmaceutical wholesalers and distributors, Managed Care Organizations, or MCOs, Pharmacy Benefit managers, or PBMs, or retail pharmacy chains and may be better positioned with respect to the cost-effective distribution of pharmaceuticals.
As a result, KKR Stockholder is able to control the election and removal of our directors and thereby determine our corporate and management policies, including potential mergers or acquisitions, payment of dividends, asset sales, amendment of our certificate of incorporation or bylaws and other significant corporate transactions for so long as KKR Stockholder and its affiliates retain significant ownership of us.
As a result, KKR Stockholder is able to influence the election and removal of our directors and thereby determine our corporate and management policies, including potential mergers or acquisitions, payment of dividends, asset sales, amendment of our certificate of incorporation or bylaws and other significant corporate transactions for so long as KKR Stockholder and its affiliates retain significant ownership of us.
Any changes to these relationships, including, but not limited to, the loss of a supplier relationship or changes in pricing, could have an adverse effect on our business and financial results. Many products dispensed by our pharmacies are manufactured with ingredients that are susceptible to supply shortages.
Any changes to these relationships, including, but not limited to, the loss of a supplier relationship or changes in (or inability to change) pricing, could have an adverse effect on our business and financial results. Many products dispensed by our pharmacies are manufactured with ingredients that are susceptible to supply shortages.
Any further additional federal fund rate increases could in turn make our financing activities, including those related to our acquisition activity, more costly and limit our ability to refinance existing debt when it matures or pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness.
Any further additional federal funds rate increases could in turn make our financing activities, including those related to our acquisition activity, more costly and limit our ability to refinance existing debt when it matures or pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness.
Fixed fee schedules, capitation payment arrangements, exclusion from participation in or inability to reach agreements with private insurance organizations or government funded programs, reduction, or elimination of payments or an increase in the payments at a rate that is less than the increase in our costs, or other factors affecting payments for healthcare services over which we have no control, could have a material adverse effect on our business, financial condition, results of operations, and prospects.
Fixed fee schedules, capitation payment arrangements, exclusion from participation in or inability to reach agreements with private insurance organizations or government funded programs, reduction, or elimination of payments or an increase in the payments at a rate that is less than the increase in our costs, or other factors affecting payments for healthcare services over which we have no control, could have a material adverse effect on our business, financial 23 Table of Contents condition, results of operations, and prospects.
We also used a portion of the IPO and concurrent offering proceeds to repay all borrowings under the Second Lien Facility. See Note 5 “Debt and Derivatives” within the audited consolidated financial statements and related notes, included elsewhere in this Annual Report on Form 10-K.
We also used a portion of the IPO and concurrent offering proceeds to repay all borrowings under the Second Lien Facility. See Note 6 “Debt and Derivatives” within the audited consolidated financial statements and related notes, included elsewhere in this Annual Report on Form 10-K.
Because our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing, or nature of our future offerings. Thus, you bear the risk of our future securities offerings reducing the market price of our common stock and diluting their interest.
Because our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing, or nature of our future offerings. Thus, you bear the risk of our future securities offerings reducing the market price of our common stock and diluting your interest.
In addition, our facilities and locations have been subject to other regulatory inquiries and matters, 33 Table of Contents such as recoupments as a result of alleged insufficient documentation, overpayments, audits, removals of clients as a result of staffing and incidents identified during a monitoring visit, contract terminations, suspensions or revocations of licenses, home closures, vendor holds, which may occur as a result of our failure to submit an acceptable report under state law, and administrative penalties issued as a result of staffing issues and incidents found during monitoring visits.
In addition, our facilities and locations have been subject to other regulatory inquiries and matters, such as recoupments as a result of alleged insufficient documentation, overpayments, audits, removals of clients as a result of staffing and incidents identified during a monitoring visit, contract terminations, suspensions or revocations of licenses, home closures, vendor holds, which may occur as a result of our failure to submit an acceptable report under state law, and administrative penalties issued as a result of staffing issues and incidents found during monitoring visits.
Our high level of indebtedness may adversely affect our credit profile or rating, which may adversely affect our ability to negotiate favorable trade terms from our current or future suppliers, including pricing, payment, delivery, inventory, transportation, defective and marketing allowances, and other terms, and may increase our need to support merchandise purchases with letters of credit.
Our high level of indebtedness may adversely affect our credit profile or rating, which may adversely affect our ability to negotiate favorable trade terms from our current or future suppliers, including pricing, payment, delivery, inventory, transportation, defective and marketing allowances, and other terms, and may increase our need to support pharmaceutical purchases with letters of credit.
For information that is not subject to HIPAA and deemed to be “personal health records,” the FTC may also impose penalties for violations of the Health Breach Notification Rule, or HBNR, to the extent we are considered a “personal health record-related entity” or “third party service provider.” The FTC has taken several enforcement actions under HBNR this year and indicated that the FTC will continue to protect consumer privacy through greater use of the agency’s enforcement authorities.
For information that is not subject to HIPAA and deemed to be “personal health records,” the FTC may also impose penalties for violations of the Health Breach Notification Rule, or HBNR, to the extent we are considered a “personal health record-related entity” or “third party service provider.” The FTC has taken enforcement actions under HBNR and indicated that the FTC will continue to protect consumer privacy through greater use of the agency’s enforcement authorities.
In addition, in the event of a default, the lenders under the Revolving Credit Facility could terminate their further commitments to loan money and our secured lenders under the First Lien Facilities and the Second Lien Facility could foreclose against the assets securing their borrowings and we could be forced into bankruptcy or liquidation.
In addition, in the event of a default, the lenders under the Revolving Credit Facility could terminate their further commitments to loan money and our secured lenders under the First Lien Facility could foreclose against the assets securing their borrowings and we could be forced into bankruptcy or liquidation.
While we believe the sale will result in increased strategic focus, operational efficiencies, a refined payer mix, and greater clinical integration and business synergy across the Provider Services segment, no assurances can be made that these impacts will occur.
While we believe the sale will result in increased strategic focus, operational efficiencies, a refined payor mix, and greater clinical integration and business synergy across the Provider Services segment, no assurances can be made that these impacts will occur.
Changes in these estimates, or changes in actual performance compared with these estimates, may affect the fair value of intangible assets or goodwill, which may result in an impairment charge. We did not recognize any goodwill impairment charge for the years ended December 31, 2023 or 2024.
Changes in these estimates, or changes in actual performance compared with these estimates, may affect the fair value of intangible assets or goodwill, which may result in an impairment charge. We did not recognize any goodwill impairment charge for the years ended December 31, 2024 or 2025.
We are subject to lawsuits, civil investigative demands, and subpoenas under the False Claims Act, the Controlled Substances Act, the Anti-Kickback Statute, and other federal and state statutes designed to combat fraud and abuse in our industries, as well as civil investigative demands, subpoenas and other inquiries related to our operations, including several ongoing qui tam actions and the Silver matter, as discussed under Item 3 “Legal Proceedings” and Note 14 “Commitments and Contingencies” to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
We are subject to lawsuits, civil investigative demands, and subpoenas under the False Claims Act, the Controlled Substances Act, the Anti-Kickback Statute, the Stark Law, and other federal and state statutes designed to combat fraud and abuse in our industries, as well as civil investigative demands, subpoenas and other inquiries related to our operations, including several ongoing qui tam actions and the Silver matter, as discussed under Item 3 “Legal Proceedings” and Note 15 “Commitments and Contingencies” to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
See “—Risks Related to Our Regulatory Framework—If we are found to have violated HIPAA, or any other applicable privacy and security laws and regulations, as well as contractual obligations, we could be subject to sanctions, fines, damages, and other additional civil or criminal penalties, which could increase our liabilities, harm our reputation, and have a material 35 Table of Contents adverse effect on our business, financial condition, and results of operation.” Furthermore, our third-party providers’ existing safety systems, data backup, access protection, user management, information technology emergency planning, and other security measures may not be sufficient to prevent data loss or long-term network outages.
See “—Risks Related to Our Regulatory Framework—If we are found to have violated HIPAA, or any other applicable privacy and security laws and regulations, as well as contractual obligations, we could be subject to sanctions, fines, damages, and other additional civil or criminal penalties, which could increase our liabilities, harm our reputation, and have a material adverse effect on our business, financial condition, and results of operations.” Furthermore, our third-party providers’ existing safety systems, data backup, access protection, user management, information technology emergency planning, and other security measures may not be sufficient to prevent data loss or long-term network outages.
If our current suppliers were to stop selling drugs to us or delay delivery, including as a result of supply shortages, production disruptions, quality issues, closing, or bankruptcies of our suppliers, or for other reasons, we may be unable to procure alternatives from other suppliers in a timely and efficient manner 28 Table of Contents and on acceptable terms, or at all.
If our current suppliers were to stop selling drugs to us or delay delivery, including as a result of supply shortages, production disruptions, quality issues, closing, or bankruptcies of our suppliers, or for other reasons, we may be unable to procure alternatives from other suppliers in a timely and efficient manner and on acceptable terms, or at all.
Further, because we generally recruit our personnel from the local area where the relevant facility is located, the availability in certain areas of suitably qualified personnel can be limited. We are subject to federal, state, and local laws and regulations that govern our employment practices, including minimum wage, living wage, and paid time-off requirements.
Further, because we generally recruit our personnel from the local area where the relevant facility is located, the availability in certain areas of suitably qualified personnel can be limited. 28 Table of Contents We are subject to federal, state, and local laws and regulations that govern our employment practices, including minimum wage, living wage, and paid time-off requirements.
The ultimate outcomes of efforts to expand the ACA, substantially amend its provisions, or change funding for the ACA is unknown. Though we cannot predict what, if any, reform proposals will be adopted, healthcare reform and legislation may have a material adverse effect on our business, financial condition, and results of operations.
The ultimate outcomes of efforts to expand the ACA, substantially amend its provisions, or change funding for the ACA is unknown. Though we 43 Table of Contents cannot predict what, if any, reform proposals will be adopted, healthcare reform and legislation may have a material adverse effect on our business, financial condition, and results of operations.
More than half of all Medicare beneficiaries were enrolled in a Medicare Advantage plan as of January 2023, a figure that continues to grow. CMS allows Medicare Advantage plans to offer certain personal care services as a supplemental benefit.
More than half of all Medicare beneficiaries were enrolled in a Medicare Advantage plan as of January 2025, a figure that continues to grow. CMS allows Medicare Advantage plans to offer certain personal care services as a supplemental benefit.
We may also be unable to negotiate favorable trade terms for our current or future service and non-merchandise vendors, including vendors that assist us in critical aspects of the business such as transportation and logistics, supplies, professional services, insurance and risk management, procurement, marketing and advertising, online operations, and information technology.
We may also be unable to negotiate favorable trade terms for our current or future service and non-pharmaceutical vendors, including vendors that assist us in critical aspects of the business such as transportation and logistics, supplies, professional services, insurance and risk management, procurement, marketing and advertising, operations, and information technology.
In addition, if we experience a greater number of these losses than we anticipate, it could have a material adverse effect on our business, financial condition, and results of operations. 39 Table of Contents Factors outside of our control, including those listed, have required, and could in the future require us to record an asset impairment of goodwill.
In addition, if we experience a greater number of these losses than we anticipate, it could have a material adverse effect on our business, financial condition, and results of operations. Factors outside of our control, including those listed, have required, and could in the future require us to record an asset impairment of goodwill.
Home health agencies that maintain pre-claim review affirmation rate or postpayment review approval rate of 90% or greater will be eligible for additional, less burdensome options for subsequent review. Compliance with this process has resulted in increased administrative costs and delays in reimbursement for home health services in the states subject to the demonstration.
Home health agencies that maintain pre-claim review affirmation rate or post-payment review approval rate of 90% or greater will be eligible for additional, less burdensome options for subsequent review. Compliance with this process has resulted in increased administrative costs and delays in reimbursement for home health services in the states subject to the demonstration.
For example, the failure of the 26 Table of Contents 2011 Joint Select Committee to meet its Deficit Reduction goal resulted in an automatic reduction in Medicare home health and hospice payments of 2% beginning April 1, 2013. Due to subsequent legislative amendments to the statute, the 2% aggregated reductions will remain in effect through 2030.
For example, the failure of the 2011 Joint Select Committee to meet its Deficit Reduction goal resulted in an automatic reduction in Medicare home health and hospice payments of 2% beginning April 1, 2013. Due to subsequent legislative amendments to the statute, the 2% aggregated reductions will remain in effect through 2030.
Any inability to offset increased brand name or generic drug acquisition costs or to modify our activities to lessen the financial impact of such increased costs could have a significant adverse effect on our operating results. We receive certain discounts, rebates, and other price concessions from suppliers.
Any inability to offset increased brand name or generic drug acquisition costs or to modify our activities to lessen 27 Table of Contents the financial impact of such increased costs could have a significant adverse effect on our operating results. We receive certain discounts, rebates, and other price concessions from suppliers.
Termination of one or more of our facilities from the Medicare program for failure to satisfy the program’s conditions of participation, or the imposition of alternative 47 Table of Contents sanctions, could disrupt operations, require significant attention by management, or have a material adverse effect on our reputation, business, financial condition, and results of operations.
Termination of one or more of our facilities from the Medicare program for failure to satisfy the program’s conditions of participation, or the imposition of alternative sanctions, could disrupt operations, require significant attention by management, or have a material adverse effect on our reputation, business, financial condition, and results of operations.
We rely on these providers to provide continual operation, as well as maintenance, enhancements, and security of any protected and/or confidential data (including personal information). To the extent that our EVV and other vendors fail to support these processes, our internal operations could be negatively affected.
We rely on these providers to provide continual operation, as well as 34 Table of Contents maintenance, enhancements, and security of any protected and/or confidential data (including personal information). To the extent that our EVV and other vendors fail to support these processes, our internal operations could be negatively affected.
If a breach affects 500 patients or more, covered entities must report it to HHS and local media without unreasonable delay (and in no case later than 60 days after discovery of the breach), and HHS will post the name of the entity on its public website.
If a breach affects 500 patients or more, covered entities must report it to HHS and local media without unreasonable delay (and in no case later than 60 days after discovery of the breach), and HHS will post 44 Table of Contents the name of the entity on its public website.
Federal Reserve Board significantly increased the federal funds rate in 2022 and 2023 and although it slightly reduced the federal funds rate in 2024, may make further rate increases to combat inflation in the United States, which increased the borrowing costs on our variable rate debt and may increase the cost of any new debt we incur.
Federal Reserve Board significantly increased the federal funds rate in 2022 and 2023 and although it slightly reduced the federal funds rate in 2024 and continued to reduce the federal funds rate in 2025, may make further rate increases to combat inflation in the United States, which increased the borrowing costs on our variable rate debt and may increase the cost of any new debt we incur.
Any claims made against us, regardless of their merit or eventual outcome, could damage our reputation and business and our ability to attract and retain patients, customers, strategic partnerships, and employees. We maintain general liability insurance to provide coverage to us and our subsidiaries against these litigation claims and potential litigation risks.
Any claims made against us, regardless of their merit or eventual outcome, could damage our reputation and business and our ability to attract and retain patients, customers, strategic partnerships, and employees. We maintain general liability insurance to provide coverage to us and our subsidiaries against certain of these non-governmental litigation claims and potential litigation risks.
See Note 1 “ Significant Accounting Policies ” and Note 4 “ Goodwill and Intangible Assets ” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
See Note 1 “ Significant Accounting Policies ” and Note 5 “ Goodwill and Intangible Assets ” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Our business and operations may consume resources faster than we anticipate. In the future, we may need to raise additional funds through the issuance of new equity securities, debt, or a combination of both. Additional financing may not be available on favorable terms or at all.
Our ability to raise capital in the future may be limited. Our business and operations may consume resources faster than we anticipate. In the future, we may need to raise additional funds through the issuance of new equity securities, debt, or a combination of both. Additional financing may not be available on favorable terms or at all.
Additionally, our organizational structure may become more complex as we expand our operational, financial, and management controls, as well as our reporting systems and procedures as a public company. We may require significant capital expenditures and the allocation of valuable management resources to grow and evolve in these areas.
Additionally, our organizational structure may become more complex as we expand our operational, financial, and management controls, as well as our reporting systems and procedures as a public company. We may require significant capital expenditures and the allocation of valuable 30 Table of Contents management resources to grow and evolve in these areas.
Additionally, the proportion of our Medicare Part D business serviced under specific agreements may change over time based upon beneficiary choice, reassignment of beneficiaries to different Medicare Part D Plans, Medicare Part D Plan consolidation or other factors, which could also adversely affect our revenue.
Additionally, the proportion of our Medicare Part D business serviced under specific agreements may change over time based upon beneficiary choice, reassignment of beneficiaries to different Medicare Part D Plans, Medicare Part 26 Table of Contents D Plan consolidation or other factors, which could also adversely affect our revenue.
If pharmaceutical manufarcturers require significant additional services and products to obtain access to their products without a corresponding increase in service fees, our profitability could be adversely impacted. 22 Table of Contents If we are unable to maintain relationships with existing patient referral sources or establish new referral sources, our business, financial condition, and results of operations could be materially adversely affected.
If pharmaceutical manufacturers require significant additional services and products to obtain access to their products without a corresponding increase in service fees, our profitability could be adversely impacted. 21 Table of Contents If we are unable to maintain relationships with existing patient referral sources or establish new referral sources, our business, financial condition, and results of operations could be materially adversely affected.
Although our insurance coverage reflects deductibles, self-insured retentions, limits of liability, and similar provisions that we believe are reasonable based on our operations, the coverage under our insurance programs may not be adequate to protect us in all circumstances.
Although our insurance coverage reflects deductibles, self-insured retentions, limits of liability, and similar provisions that we believe are reasonable based on our operations, the coverage under our insurance programs may not be adequate to protect us in all 38 Table of Contents circumstances.
Litigation with those affected 45 Table of Contents could increase our liabilities, harm our reputation, and have a material adverse effect on our business, financial condition, and results of operations. Numerous other federal and state laws protect the confidentiality, privacy, availability, integrity, and security of PHI.
Litigation with those affected could increase our liabilities, harm our reputation, and have a material adverse effect on our business, financial condition, and results of operations. Numerous other federal and state laws protect the confidentiality, privacy, availability, integrity, and security of PHI.
A person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation; • the federal physician self-referral law, commonly referred to as the Stark Law, which, subject to limited exceptions, prohibits physicians from referring Medicare or Medicaid patients to an entity for the provision of certain “designated health services” if the physician or a member of such physician’s immediate family has a direct or indirect financial relationship (including an ownership interest or a compensation arrangement) with the entity, and prohibit the entity from billing Medicare or Medicaid for such designated health services; 42 Table of Contents • the False Claims Act, which imposes civil and criminal liability on individuals or entities that knowingly submit false or fraudulent claims for payment to the government or knowingly making, or causing to be made, a false statement in order to have a false claim paid, including qui tam or whistleblower suits.
A person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation; • the federal physician self-referral law, commonly referred to as the Stark Law, which, subject to limited exceptions, prohibits physicians from referring Medicare or Medicaid patients to an entity for the provision of certain “designated health services” if the physician or a member of such physician’s immediate family has a direct or indirect financial relationship (including an ownership interest or a compensation arrangement) with the entity, and prohibits the entity from billing Medicare or Medicaid for such designated health services; • the False Claims Act, which imposes civil and criminal liability on individuals or entities that knowingly submit false or fraudulent claims for payment to the government or knowingly make, or cause to be made, a false statement in order to have a false claim paid, including qui tam or whistleblower suits.
Many payors seek to limit the number of 27 Table of Contents providers that supply pharmaceuticals to their enrollees in order to build volume that justifies their discounted pricing. From time to time, payors with whom we have relationships require that we bid against our competitors to keep their business.
Many payors seek to limit the number of providers that supply pharmaceuticals to their enrollees in order to build volume that justifies their discounted pricing. From time to time, payors with whom we have relationships require that we bid against our competitors to keep their business.
Threats to our systems and associated third-party systems can originate from human error, fraud, or malice on the part of employees or third parties or simply from accidental technological failure. Computer viruses and other malware can be distributed and could infiltrate our systems or those 36 Table of Contents of associated third parties.
Threats to our systems and associated third-party systems can originate from human error, fraud, or malice on the part of employees or third parties or simply from accidental technological failure. Computer viruses and other malware can be distributed and could infiltrate our systems or those of associated third parties.
In addition, certain third parties, known as conveners, offer patient placement and care transition services to managed care companies, Medicare Advantage plans, bundled payment participants, ACOs, and other healthcare providers as part of an effort to manage costs.
In addition, certain third parties, known as conveners, offer patient placement and care transition services to managed care companies, Medicare Advantage plans, bundled payment participants, Accountable Care Organizations, or ACOs, and other healthcare providers as part of an effort to manage costs.
For example, while we believe that the services we 34 Table of Contents provide are of high quality, if our “quality measures,” which are published annually online by CMS, are deemed to be not of the highest value, our reputation could be negatively affected.
For example, while we believe that the services we provide are of high quality, if our “quality measures,” which are published annually online by CMS, are deemed to be not of the highest value, our reputation could be negatively affected.
We cannot be assured that reimbursement payments under Medicare and Medicaid will be sufficient to cover the costs allocable to patients eligible for reimbursement pursuant to these programs. Commercial payors such as managed care organizations and private health insurance programs generally reimburse us for the services rendered to insured patients based upon contractually determined rates.
We cannot be assured that reimbursement payments under Medicare and Medicaid will be sufficient to cover the costs allocable to patients eligible for reimbursement pursuant to these programs. Commercial payors 29 Table of Contents such as managed care organizations and private health insurance programs generally reimburse us for the services rendered to insured patients based upon contractually determined rates.
As a result, you may not receive any return on an investment in our common stock unless you sell our common stock for a price greater than your purchase price. BrightSpring Health Services, Inc. depends on its subsidiaries for cash to fund its operations and expenses, including future dividend payments, if any, and to meet its debt obligations.
As a result, you may not receive any return on an investment in our common stock unless you sell our common stock for a price greater than your purchase price. 52 Table of Contents BrightSpring Health Services, Inc. depends on its subsidiaries for cash to fund its operations and expenses, including future dividend payments, if any, and to meet its debt obligations.
Future inclement weather, natural disasters, acts of terrorism, riots, civil insurrection, social unrest or other acts of violence, looting, protests, strikes or street demonstrations may adversely affect our reputation, business, financial condition, and results of operations. We may be unable to adequately protect our intellectual property rights, which could harm our business.
Future inclement weather, natural disasters, acts of terrorism, riots, civil insurrection, social unrest or other acts of violence, looting, protests, strikes or street demonstrations, or pandemics, may adversely affect our reputation, business, financial condition, and results of operations. 39 Table of Contents We may be unable to adequately protect our intellectual property rights, which could harm our business.
Although the credit agreements governing the First Lien Facilities contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions, and the additional indebtedness incurred in compliance with these restrictions could be substantial.
Although the credit agreements 48 Table of Contents governing the First Lien Facilities contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions, and the additional indebtedness incurred in compliance with these restrictions could be substantial.
If one or both of such agreements were to terminate or if we were to otherwise lose our right to participate in such agreements, we may not be able to replace such arrangements to purchase pharmaceutical products and services at similarly favorable prices or at all.
If such agreements were to terminate or if we were to otherwise lose our right to participate in such agreements, we may not be able to replace such arrangements to purchase pharmaceutical products and services at similarly favorable prices or at all.
In November 2020, the HHS released the Rebate Rule, which eliminates the regulatory safe harbor from prosecution under the Anti-Kickback Statute for rebates from pharmaceutical companies to PBMs in Medicare Part D and in Medicaid MCOs, replacing it with two far narrower safe harbors designed to directly benefit patients with high out-of-pocket costs and to change the way PBMs are compensated.
For example, in November 2020, the HHS released the Rebate Rule, which eliminates the regulatory safe harbor from prosecution under the Anti-Kickback Statute for rebates from pharmaceutical companies to PBMs in Medicare Part D and in Medicaid MCOs, replacing it with two more narrow safe harbors designed to directly benefit patients with high out-of-pocket costs and to change the way PBMs are compensated.
The rules governing the standards that must be met for our management to assess our internal control over financial reporting are complex and require 52 Table of Contents significant documentation, testing, and possible remediation. Testing and maintaining internal controls may divert our management’s attention from other matters that are important to our business.
The rules governing the standards that must be met for our management to assess our internal control over financial reporting are complex and require significant documentation, testing, and possible remediation. Testing and maintaining internal controls may divert our management’s attention from other matters that are important to our business.
As our business evolves and expands, and if we offer new payment options to consumers, we may be subject to additional regulations, compliance requirements, fraud, and other risks, in addition to new assessments that involve 37 Table of Contents costs above what we currently pay for compliance.
As our business evolves and expands, and if we offer new payment options to consumers, we may be subject to additional regulations, compliance requirements, fraud, and other risks, in addition to new assessments that involve costs above what we currently pay for compliance.
Although we may 46 Table of Contents have contractual protections with our service providers, any actual or perceived security breach could harm our reputation and brand, expose us to potential liability, or require us to expend significant resources on data security and in responding to any such actual or perceived breach.
Although we may have contractual protections with our service providers, any actual or perceived security breach could harm our reputation and brand, expose us to potential liability, or require us to expend significant resources on data security and in responding to any such actual or perceived breach.
Enrollment in managed Medicaid plans is also growing, as states are increasingly relying on MCOs to deliver Medicaid program services as a strategy to control costs and manage resources.
Enrollment in managed Medicaid plans is also growing, as states are increasingly relying on Managed Care Organizations, or MCOs to deliver Medicaid program services as a strategy to control costs and manage resources.
If we are unable to prevent our competitors from using names, logos, slogans, and domain names similar to ours, consumer confusion could result, the perception of our brands and services could be negatively affected, and our revenue and profitability could suffer as a result.
If we are unable to prevent our competitors from using names, logos, slogans, and domain names similar to ours, or if we are prevented by our competitors from using certain names, logos, slogans and domain names, consumer confusion could result, the perception of our brands and services could be negatively affected, and our revenue and profitability could suffer as a result.
We have 7,968,779 Units outstanding, and each purchase contract that is a component of a Unit will settle automatically on the mandatory settlement date into between 3.2733 and 3.8461 shares of our common stock, subject to certain anti-dilution adjustments, which may result in dilution to investors.
We have 3,584,759 Units outstanding, and each purchase contract that is a component of a Unit will settle automatically on the mandatory settlement date into between 3.2733 and 3.8461 shares of our common stock, subject to certain anti-dilution adjustments, which may result in dilution to investors.
There can be no assurance that we will not be subject to such HHS investigations or investigations by other governmental or regulatory authorities in the future, including those that may have a material impact on our business.
There can be no assurance 35 Table of Contents that we will not be subject to such HHS investigations or investigations by other governmental or regulatory authorities in the future, including those that may have a material impact on our business.
Further, any failure by the Congress to complete the federal budget process and fund government operations may result in a shutdown, potentially causing us to incur substantial costs without reimbursement under the Medicare program.
Further, any failure by the Congress to complete the federal budget process and fund government operations may result in a shutdown, 25 Table of Contents potentially causing us to incur substantial costs without reimbursement under the Medicare program.
Employees and workforce members have engaged in conduct (including failing to take action) that has impacted, and may in the future engage in conduct that impacts, our service users or their health, safety, welfare, or clinical treatment.
Employees and workforce members have engaged in conduct (including failing to take action) that has impacted, and may in the future engage in conduct that impacts, our service users or their 32 Table of Contents health, safety, welfare, or clinical treatment.
Our defensive measures may not prevent unplanned downtime, or the unauthorized access, acquisition, disclosure, or use of confidential, sensitive data, and/or personal information.
Our defensive measures may not prevent unplanned downtime, or 36 Table of Contents the unauthorized access, acquisition, disclosure, or use of confidential, sensitive data, and/or personal information.
We regularly assess the likelihood of adverse outcomes resulting from such examinations to determine the adequacy of our 55 Table of Contents provision for income taxes.
We regularly assess the likelihood of adverse outcomes resulting from such examinations to determine the adequacy of our provision for income taxes.
Similarly, private third-party payors also engage in 24 Table of Contents post-payment audits which can result in recoupments. Additionally, private third-party payors may be successful in negotiating reduced reimbursement schedules for our services.
Similarly, private third-party payors also engage in post-payment audits which can result in recoupments. Additionally, private third-party payors may be successful in negotiating reduced reimbursement schedules for our services.
We are not paid for authorized services that are not delivered due to these events.
We are not paid for authorized goods and services that are not delivered due to these events.
For example, the market price of our common stock could become more volatile and could be depressed by: • investors’ anticipation of the potential resale in the market of a substantial number of additional shares of our common stock received upon settlement of the purchase contracts that are a component of the Units; • possible sales of our common stock by investors who view the Units as a more attractive means of equity participation in us than owning shares of our common stock; and • hedging or arbitrage trading activity that may develop involving the Units and our common stock. 53 Table of Contents Our ability to raise capital in the future may be limited.
For example, the market price of our common stock could become more volatile and could be depressed by: • investors’ anticipation of the potential resale in the market of a substantial number of additional shares of our common stock received upon settlement of the purchase contracts that are a component of the Units; • possible sales of our common stock by investors who view the Units as a more attractive means of equity participation in us than owning shares of our common stock; and • hedging or arbitrage trading activity that may develop involving the Units and our common stock.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

11 edited+3 added−16 removed18 unchanged
Biggest changeThe comparisons assume the investment of $100 on January 26, 2024 in our common stock and in each index, and the reinvestment of dividends when paid. 1/26/2024 3/28/2024 6/28/2024 9/30/2024 12/31/2024 BrightSpring Health Services, Inc. $ 100.00 $ 98.82 $ 103.27 $ 133.45 $ 154.82 S&P 500 Index $ 100.00 $ 107.43 $ 111.64 $ 117.82 $ 120.25 S&P 500 Health Care Services Select Industry Index $ 100.00 $ 108.58 $ 103.05 $ 110.98 $ 103.33 The stock performance graph above shall not be deemed to be “soliciting material” or to be “filed” with the U.S.
Biggest changeThe comparisons 57 Table of Contents assume the investment of $100 on January 26, 2024 in our common stock and in each index, and the reinvestment of dividends, if any, when paid. 1/26/2024 3/28/2024 6/28/2024 9/30/2024 12/31/2024 3/31/2025 6/30/2025 9/30/2025 12/31/2025 BrightSpring Health Services, Inc. $ 100.00 $ 98.82 $ 103.27 $ 133.45 $ 154.82 $ 164.45 $ 214.45 $ 268.73 $ 340.45 S&P 500 Index $ 100.00 $ 107.74 $ 112.35 $ 118.96 $ 121.83 $ 116.63 $ 129.39 $ 139.90 $ 143.61 S&P 500 Health Care Services Select Industry Index $ 100.00 $ 108.70 $ 103.31 $ 111.45 $ 103.93 $ 112.95 $ 114.94 $ 117.53 $ 123.82 The stock performance graph above shall not be deemed to be “soliciting material” or to be “filed” with the U.S.
For further discussion of the risks associated with cybersecurity incidents, as well as a description of an event that occurred in March 2023, see “Risk Factors—Risks Related to Our Business—Security breaches, loss of data, and other disruptions could compromise sensitive business or patient information, cause a loss of confidential patient data, employee data, personal information, 56 Table of Contents or prevent access to critical information, and expose us to liability, litigation, and federal and state governmental inquiries and damage our reputation and brand.” Governance Our Board of Directors has overall oversight responsibility for our risk management, and delegates information security and related risk management oversight to the Audit Committee.
For further discussion of the risks associated with cybersecurity incidents, as well as a description of an event that occurred in March 2023, see “Risk Factors—Risks Related to Our Business—Security breaches, loss of data, and other disruptions could compromise sensitive business or patient information, cause a loss of confidential patient data, employee data, personal information, or prevent access to critical information, and expose us to liability, litigation, and federal and state governmental inquiries and damage our reputation and brand.” Governance Our Board of Directors has overall oversight responsibility for our risk management, and delegates information security and related risk management oversight to the Audit Committee.
We incorporate cybersecurity practices into our Enterprise Risk Management (ERM) approach, which is subject to oversight by our Board of Directors. Our cybersecurity policies and practices are aligned with relevant industry standards and are designed to detect, prevent, contain, and respond to cybersecurity threats and incidents in a prompt and effective manner.
We incorporate cybersecurity practices into our Enterprise Risk Management (ERM) approach, which is subject to oversight by our Board of Directors. Our cybersecurity policies and practices are aligned with relevant 54 Table of Contents industry standards and are designed to detect, prevent, contain, and respond to cybersecurity threats and incidents in a prompt and effective manner.
Recent Sales of Unregistered Securities Except as set forth below, there were no sales of equity securities during the period covered by this Report that were not registered under the Securities Act and were not previously reported in a Quarterly Report on Form 10-Q or a Current Report on Form 8-K filed by the Company.
Recent Sales of Unregistered Securities There were no sales of equity securities during the period covered by this Report that were not registered under the Securities Act and were not previously reported in a Quarterly Report on Form 10-Q or a Current Report on Form 8-K filed by the Company.
Stock Performance Graph The following performance graph compares the cumulative total return to shareholders on our common stock relative to the cumulative total returns of the S&P 500 Index and S&P 500 Health Care Services Select Industry Index, the Dow Jones US Industrial 59 Table of Contents Average Index and the S&P 500 Index for the period beginning with our IPO and ended December 31, 2024.
Stock Performance Graph The following performance graph compares the cumulative total return to shareholders on our common stock relative to the cumulative total returns of the S&P 500 Index and S&P 500 Health Care Services Select Industry Index, the Dow Jones US Industrial Average Index and the S&P 500 Index for the period beginning with our IPO and ending December 31, 2025.
Prior to that date, there was no public market for our common stock or 6.75% Tangible Equity Units. Stockholders As of March 3, 2025, there were approximately 56 holders of our common stock.
Prior to that date, there was no public market for our common stock or 6.75% Tangible Equity Units. Stockholders As of February 24, 2026, there were approximately 51 holders of our common stock.
Through ongoing communications with these teams during incidents, the CIO monitors the triage, mitigation and remediation of cybersecurity incidents, and reports such incidents to executive management, the Audit Committee and other colleagues in accordance with our cybersecurity policies and procedures , as is appropriate. It em 2. Properties.
Prompt response to incidents is delivered by multi-disciplinary teams in accordance with our incident response plan. Through ongoing communications with these teams during incidents, the CIO monitors the triage, mitigation and remediation of cybersecurity incidents, and reports such incidents to executive management, the Audit Committee and other colleagues in accordance with our cybersecurity policies and procedures , as is appropriate.
Our principal executive offices are located in Louisville, Kentucky, where we lease approximately 100,000 square feet. We also own 67 properties and lease 2,098 properties, with an additional 231 service sites, in the United States and lease one property in Canada. Of the leased properties, approximately 90% are provider service properties and 10% are pharmacy locations.
It em 2. Properties. Our principal executive offices are located in Louisville, Kentucky, where we lease approximately 100,000 square feet. We also own 2 properties and lease 849 properties in the United States and lease one property in Canada. Of the leased properties, approximately 76% are provider service properties and 24% are pharmacy locations.
Our CIO has over twenty-five years of extensive experience in information technology and security, and works in coordination with other members of the management team, including, among others, the Chief Financial Officer and Chief Compliance Officer and their designees. We believe our business leaders have the appropriate expertise, background, and depth of experience to manage risks arising from cybersecurity threats.
Our CIO has over twenty-five years of extensive experience in information technology and security, and works in coordination with other members of the management team, 55 Table of Contents including, among others, the Chief Financial Officer and Chief Compliance Officer and their designees.
We consider these facilities to be suitable and adequate for the management and operations of our business. Ite m 3. Legal Proceedings. Legal Proceedings From time to time, we are involved in various legal and/or administrative proceedings and subject to claims that arise in the ordinary course of business.
We consider these facilities to be suitable and adequate for the management and operations of our business. Our properties that are associated with the Community Living business are excluded from this Item 2 since those operations are excluded from continuing operations. Ite m 3. Legal Proceedings.
Our CIO, along with leaders from our privacy and corporate compliance functions, collaborate to implement a program designed to manage our exposure to cybersecurity risks and to promptly respond to cybersecurity incidents. Prompt response to incidents is delivered by multi-disciplinary teams in accordance with our incident response plan.
We believe our business leaders have the appropriate expertise, background, and depth of experience to manage risks arising from cybersecurity threats. Our CIO, along with leaders from our privacy and corporate compliance functions, collaborate to implement a program designed to manage our exposure to cybersecurity risks and to promptly respond to cybersecurity incidents.
Removed
We do not believe the ultimate liability, if any, for outstanding proceedings or claims, individually or in the aggregate, in excess of amounts already provided in our consolidated financial statements, will have a material adverse effect on our business, financial condition or results of operations.
Added
Legal Proceedings See Note 15 "Commitments and Contingencies" within the audited consolidated financial statements and related notes included in this Annual Report on Form 10-K, which is incorporated herein by reference. It em 4. Mi ne Safety Disclosures. Not applicable. 56 Table of Contents PART II It em 5.
Removed
It is reasonably possible that an adverse determination might have an impact on a particular period. Regardless of the outcome, litigation has the potential to have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. On March 4, 2011, Relator Marc Silver, on behalf of the U.S.
Added
Issuer Purchases of Equity Securities The following table presents repurchases of shares of common stock completed during the three months ended December 31, 2025 (in thousands, except per share amounts): Period Total Number of Shares Purchased Average Price Paid Per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Maximum Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (in thousands) October 1, 2025 - October 31, 2025 1,500 $ 28.7820 1,500 — November 1, 2025 - November 30, 2025 — — — — December 1, 2025 - December 31, 2025 — — — — Total 1,500 $ 43,173 1,500 — (1) The average price per share is equal to the price at which the underwriter purchased the shares from KKR Stockholder in the underwritten secondary offering that closed on October 22, 2025.
Removed
Government and various state governments, filed a complaint in the United States District Court for the District of New Jersey, or the District Court, against PharMerica, seeking relief, with respect to alleged violations of the federal False Claims Act and state false claims acts, including three times the amount of damages to the federal government plus civil penalties and no less than a certain amount for each alleged false claim, as well as any other recoveries or relief provided for by the federal False Claims Act; damages, fines, penalties, and other recoveries or relief permitted under state false claims acts; and other forms of relief, including attorneys’ fees.
Added
(2) In October 2025, the Company announced the terms of the October 2025 secondary offering pursuant to which the Company concurrently repurchased from the underwriter 1,500,000 shares of common stock. As of December 31, 2025, the entire capacity available under this stock repurchase program had been utilized, and there is no remaining authorized repurchase capacity outstanding.
Removed
The complaint alleged that, in violation of the Anti-Kickback Statute and the False Claims Act, PharMerica offered below-cost or below-fair-market-value prices on drugs in exchange for so-called preferred or exclusive provider status that would allow PharMerica to dispense drugs to patients for which PharMerica could bill federal healthcare program payers. The U.S.
Removed
Government and state governments declined to intervene in the case. The District Court issued an order dismissing the case in full in 2016. In 2018, however, the Third Circuit Court of Appeals issued an order reinstating the case.
Removed
In April 2023, the District Court issued an order denying Relator’s motion seeking to strike portions of the opinions of PharMerica’s experts and granted in part PharMerica’s motions to exclude Relator’s experts. On June 28, 2023, the District Court issued an order setting a trial date of December 4, 2023.
Removed
On November 6, 2023, the District Court denied our motion for summary judgment. On November 18, 2023, we agreed to settle the matter without admitting liability. On May 29, 2024, the parties entered into a final settlement agreement, which was approved by both the United States Department of Justice and the District Court.
Removed
The total financial impact of the settlement is $120.0 million; $110.0 million of which was paid during the year ended 57 Table of Contents December 31, 2024, with the remaining $10.0 million in accrued expenses in the consolidated balance sheet as of December 31, 2024.
Removed
As of December 31, 2023, the estimated financial impact of the settlement was $115.0 million, $105.0 million of which was included in accrued expenses and $10.0 million in long-term liabilities in the consolidated balance sheet. The District Court entered an order dismissing the Silver action in its entirety, with prejudice, on July 3, 2024.
Removed
The Company is also party to various legal and/or administrative proceedings arising out of the operation of our programs and arising in the ordinary course of business. We record accruals for such contingencies to the extent that we conclude it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated.
Removed
We do not believe the ultimate liability, if any, for outstanding proceedings or claims, individually or in the aggregate, in excess of amounts already provided, will have a material adverse effect on our consolidated financial condition, results of operations, or cash flows. It is reasonably possible that an adverse determination might have an impact on a particular period.
Removed
While we believe our provision for legal contingencies is adequate, the outcome of legal proceedings is difficult to predict, and we may settle legal claims or be subject to judgments for amounts that exceed our estimates. It em 4. Mi ne Safety Disclosures. Not applicable. 58 Table of Contents PART II It em 5.
Removed
On April 30, 2024, we issued 99,252 shares of common stock at $10.89 per share to Rodney A.
Removed
Thomason Revocable Trust shareholders (the “Trust”) as partial consideration for our acquisition of certain assets and equity interests from the Trust, ICP Holdings, LLC and ICP Management, LLC (together with ICP Holdings, LLC, the “Sellers”) pursuant to an Asset Purchase Agreement by and among the Company, the Trust, and the Sellers (the “ICP Purchase Agreement”).
Removed
We also issued 30,533 shares of common stock at $10.89 per share to the Trust to be held by the Company subject to a one year lock-up post-closing adjustment feature based on stock price performance. This post-closing adjustment resulted in the number of holdback shares being reduced to zero and cancelled.
Removed
We issued these shares of common stock pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Act”), in that such issuance did not constitute a public offering. Issuer Purchases of Equity Securities None.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

135 edited+32 added−50 removed122 unchanged
Biggest changeBy providing these complementary and necessary services for complex patients, our care model is designed to address multiple patient needs and better integrate health services delivery to improve quality and patient experiences, while reducing overall costs. 2024 Key Highlights • Completion of our Initial Public Offering ( “IPO”) on January 30, 2024 • Extinguishment of our Second Lien Facility • Paydown and modification of our First Lien Facility, including interest rate refinancings that resulted in interest savings • $63.3 million of equity awards granted to management and certain other full-time employees at the time of our IPO • 7.7 million restricted stock units granted to certain full-time employees in the second fiscal quarter of 2024, as disclosed in connection with our IPO • Completed eight acquisitions within our Pharmacy Solutions and Provider Services segments • Announcement of the pending divestiture of our Community Living business on January 20, 2025 61 Table of Contents Financial Performance Highlights: Fiscal Year 2024 Compared to Fiscal Year 2023 • Revenue grew by $2.4 billion, or 27.6%, to $11.3 billion • Pharmacy Solutions segment revenue grew by $2.2 billion, or 34.2%, to $8.8 billion • Provider Services segment revenue grew by $208.5 million, or 9.0%, to $2.5 billion • Net loss decreased by $136.3 million from $156.8 million to $20.5 million; when excluding the approximately $30 million quality incentive payment ( “ QIP ” ) received in 2023, net loss decreased by $166.5 million • Adjusted EBITDA (1) increased by $50.3 million, or 9.3%, to $588.1 million; when excluding the approximately $30 million QIP received in 2023, Adjusted EBITDA increased by $80.5 million or 15.9% • Pharmacy Solutions segment EBITDA grew by $23.7 million, or 6.4%, to $394.7 million; when excluding the approximately $30 million QIP received in 2023, Pharmacy Solutions segment EBITDA increased by $53.9 million or 15.8% • Provider Services segment EBITDA grew by $53.9 million, or 17.6%, to $360.6 million • Loss per share decreased by $1.22 from $(1.31) to $(0.09) • Adjusted EPS (1) increased by $0.49 from $0.07 to $0.56 (1) Reconciliation of GAAP to non-GAAP results is provided in the section “Non-GAAP Financial Measures” in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations ” Our Service Offerings We are one of the largest independent providers of home and community-based health services in the United States, delivering both pharmacy and provider services.
Biggest changeAs a result of these offerings, we are no longer a “controlled company” within the meaning of the corporate governance standards of Nasdaq • Repurchased 1,500,000 shares of common stock in connection with the October 2025 secondary offering Financial Performance Highlights: Fiscal Year 2025 Compared to Fiscal Year 2024 • Revenue grew by $2.8 billion, or 28.2%, to $12.9 billion • Pharmacy Solutions segment revenue grew by $2.7 billion, or 30.7%, to $11.4 billion • Provider Services segment revenue grew by $146.9 million, or 11.1%, to $1.5 billion • Net income increased by $173.7 million from a net loss of $68.9 million to net income of $104.8 million • Adjusted EBITDA (1) increased by $157.4 million, or 34.2%, to $617.6 million • Pharmacy Solutions segment EBITDA grew by $148.8 million, or 37.7%, to $543.5 million • Provider Services segment EBITDA grew by $27.4 million, or 13.3%, to $232.7 million • Diluted income per share increased by $0.82 from diluted loss per share of $(0.34) to diluted income per share of $0.48 • Adjusted EPS (1) increased by $0.65 from $0.35 to $1.00 (1) Reconciliation of GAAP to non-GAAP results is provided in the section “Non-GAAP Financial Measures” in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations ” Our Service Offerings We are one of the largest independent providers of home and community-based health services in the United States, delivering both pharmacy and provider services.
Interest expense, net also includes the portion of the gain or loss on our interest rate swap agreements that is reclassified into earnings. Income Tax Benefit . Our provision for income taxes is based on permanent book/tax differences and statutory tax rates in the various jurisdictions in which we operate.
Interest expense, net also includes the portion of the gain or loss on our interest rate swap agreements that is reclassified into earnings. Income Tax Expense (Benefit) . Our provision for income taxes is based on permanent book/tax differences and statutory tax rates in the various jurisdictions in which we operate.
GAAP measures, we believe they provide useful information for evaluating our core business performance, enable comparison of financial results across periods, and allow for greater transparency with respect to key metrics used by management for financial and operational decision-making. We define EBITDA as net loss before income tax benefit, interest expense, net, and depreciation and amortization.
GAAP measures, we believe they provide useful information for evaluating our core business performance, enable comparison of financial results across periods, and allow for greater transparency with respect to key metrics used by management for financial and operational decision-making. We define EBITDA as net income (loss) before income tax expense (benefit), interest expense, net, and depreciation and amortization.
Financing Activities Net cash provided by financing activities was $164.6 million for the year ended December 31, 2024, primarily attributable to net proceeds received from the IPO Offerings of $1,045.5 million, net borrowings on our Revolving Credit Facility of $12.6 million, partially offset by extinguishment of and net repayments on our long-term debt of $830.3 million, payment of debt issuance costs of $47.0 million, payment of finance lease obligations of $11.6 million, and other financing activities.
Net cash provided by financing activities was $164.6 million for the year ended December 31, 2024, primarily attributable to net proceeds received from the IPO Offerings of $1,045.5 million, net borrowings on our Revolving Credit Facility of $12.6 million, partially offset by extinguishment of and net repayments on our long-term debt of $830.3 million, payment of debt issuance costs of $47.0 million, payment of finance lease obligations of $11.6 million, and other financing activities.
No remaining obligation exists related to the Second Lien Facility and the transaction was accounted for as a debt extinguishment resulting in a $12.7 million related to the write-off of unamortized debt issuance costs.
No remaining obligation exists related to the Second Lien Facility and the transaction was accounted for as a debt extinguishment resulting in a $12.7 million write-off of unamortized debt issuance costs.
For transactions involving the transfer of goods, revenues are primarily recognized when the customer obtains control of the products sold, which is generally upon shipment or delivery, depending on the delivery terms specified in the sales agreement. For transactions exclusively involving provision of services, revenues are recognized over time based on an appropriate measure of progress.
For transactions involving the transfer of goods, revenues are primarily recognized when the customer obtains control of the products sold, which is generally upon shipment or delivery, depending on the delivery terms specified in the sales agreement. For transactions exclusively involving provision of services, revenues are recognized over time based on an appropriate measure of progress.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of O perations The following discussion analyzes our financial condition and results of operations and should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this Annual Report Form 10-K. This discussion contains forward-looking statements that involve risks and uncertainties.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of O perations The following discussion analyzes our financial condition and results of operations and should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. This discussion contains forward-looking statements that involve risks and uncertainties.
GAAP and should be considered in addition to, and not as a substitute for, net loss, diluted EPS or other financial measures performed in accordance with U.S. GAAP. Our method of determining non-GAAP financial measures may differ from other companies’ financial measures and therefore may not be comparable to methods used by other companies.
GAAP and should be considered in addition to, and not as a substitute for, net income (loss), diluted EPS or other financial measures performed in accordance with U.S. GAAP. Our method of determining non-GAAP financial measures may differ from other companies’ financial measures and therefore may not be comparable to methods used by other companies.
These non-GAAP financial measures are not intended to replace financial performance measures determined in accordance with U.S. GAAP, such as net loss and diluted EPS. Rather, we present EBITDA, Adjusted EBITDA, and Adjusted EPS as supplemental measures of our performance. EBITDA, Adjusted EBITDA, and Adjusted EPS The following are key financial metrics and, when used in conjunction with U.S.
These non-GAAP financial measures are not intended to replace financial performance measures determined in accordance with U.S. GAAP, such as net income (loss) and diluted EPS. Rather, we present EBITDA, Adjusted EBITDA, and Adjusted EPS as supplemental measures of our performance. EBITDA, Adjusted EBITDA, and Adjusted EPS The following are key financial metrics and, when used in conjunction with U.S.
The financial measure calculated under U.S. GAAP which is most directly comparable to Adjusted EBITDA is net loss. The financial measure calculated under U.S. GAAP which is most directly comparable to Adjusted EPS is diluted EPS. We have historically incurred substantial acquisition, integration, and transaction-related costs.
The financial measure calculated under U.S. GAAP which is most directly comparable to Adjusted EBITDA is net income (loss). The financial measure calculated under U.S. GAAP which is most directly comparable to Adjusted EPS is diluted EPS. We have historically incurred substantial acquisition, integration, and transaction-related costs.
Additionally, for Seniors and others who require supportive care and activities of daily living support that address social determinants of health, including dietary and nutrition management and cognitive and social engagement, among others, we offer these daily or weekly services. 63 Table of Contents We are continuing to build out specialized and different primary care capabilities through our home-based primary care medical home model and platform, which we view as central to the future of optimizing patient management, including patient experiences, outcomes, and cost.
Additionally, for Seniors and others who require supportive care and activities of daily living support that address social determinants of health, including dietary and nutrition management and cognitive and social engagement, among others, we offer these daily or weekly services. 61 Table of Contents We are continuing to build out specialized and different primary care capabilities through our home-based primary care medical home model and platform, which we view as central to the future of optimizing patient management, including patient experiences, outcomes, and cost.
Goodwill and Intangible Assets Goodwill represents the amount of the purchase price in excess of the fair values assigned to the underlying identifiable net assets of acquired businesses. Goodwill is not amortized, but is subject to an annual impairment test.
Goodwill and Intangible Assets Goodwill Impairment Analyses Goodwill represents the amount of the purchase price in excess of the fair values assigned to the underlying identifiable net assets of acquired businesses. Goodwill is not amortized, but is subject to an annual impairment test.
Aligning to Value-Based Care Reimbursement Models with Innovative Solutions The scale and depth of our complimentary platform of diverse yet related customer and patient services – that complex patients require – positions us at the forefront with governmental and commercial payors who are increasingly seeking ways to expand value-based reimbursement models.
Aligning to Value-Based Care Reimbursement Models with Innovative Solutions The scale and depth of our complementary platform of diverse yet related customer and patient services – that complex patients require – positions us at the forefront with governmental and commercial payors who are increasingly seeking ways to expand value-based reimbursement models.
Concurrently with the IPO, we issued 8,000,000 TEUs, which have a stated amount of $50.00 per unit. Each TEU is comprised of a prepaid stock purchase contract (“Purchase Contract”) and a senior amortizing note (“Amortizing Note”) due February 1, 2027, each issued by the Company.
Concurrently with the IPO, we issued 8,000,000 TEUs, which have a stated amount of $50.00 per unit. Each TEU is comprised of a prepaid stock purchase contract and a senior amortizing note (“Amortizing Note”) due February 1, 2027, each issued by the Company.
As of December 31, 2024 and 2023, we were not involved in any unconsolidated SPE transactions. We do enter into letters of credit in the normal course of our operations. Critical Accounting Policies and Use of Estimates In preparing our consolidated financial statements in conformity with U.S.
As of December 31, 2025 and 2024, we were not involved in any unconsolidated SPE transactions. We do enter into letters of credit in the normal course of our operations. Critical Accounting Policies and Use of Estimates In preparing our consolidated financial statements in conformity with U.S.
(1) Reconciliation of GAAP to non-GAAP results is provided in the section “Non-GAAP Financial Measures” in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations ” Segment Results of Operations Pharmacy Solutions Segment The following table sets forth, for the years indicated, our segment results of operations.
(1) Reconciliation of GAAP to non-GAAP results is provided in the section “Non-GAAP Financial Measures” in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations ” 68 Table of Contents Segment Results of Operations Pharmacy Solutions Segment The following table sets forth, for the years indicated, our segment results of operations.
Significant estimates and judgments are required in determining the provision for income taxes. Results of Operations This section of this Annual Report on Form 10-K generally discusses the years ended December 31, 2024 and 2023 and year-over-year comparisons between the years ended December 31, 2024 and 2023.
Significant estimates and judgments are required in determining the provision for income taxes. Results of Operations This section of this Annual Report on Form 10-K generally discusses the years ended December 31, 2025 and 2024 and year-over-year comparisons between the years ended December 31, 2025 and 2024.
Adjusted EBITDA and Adjusted EPS exclude certain other items that are either non-recurring, infrequent, non-cash, unusual, or items deemed by management to not be indicative of the performance of our core operations, including non-cash, share-based compensation; acquisition, integration, and transaction-related costs; restructuring and divestiture-related and other costs; legal and settlement costs associated with certain historical matters for PharMerica; significant projects; management fees; and unreimbursed COVID-19 related costs.
Adjusted EBITDA and Adjusted EPS exclude certain other items that are either non-recurring, infrequent, non-cash, unusual, or items deemed by management to not be indicative of the performance of our core operations, including non-cash, share-based compensation; acquisition, integration, and transaction-related costs; restructuring and divestiture-related and other costs; legal and settlement costs associated with certain historical matters for PharMerica; significant projects; and management fees.
Given our determination of adjustments in arriving at our computations of EBITDA, Adjusted EBITDA, and Adjusted EPS, these non-GAAP measures have limitations as analytical tools and should not be considered in isolation or as substitutes or alternatives to net loss, operating income, loss per diluted share, cash flows from operating activities, total indebtedness, or any other financial measures calculated in accordance with U.S.
Given our determination of adjustments in arriving at our computations of EBITDA, Adjusted EBITDA, and Adjusted EPS, these non-GAAP measures have limitations as analytical tools and should not be considered in isolation or as substitutes or 71 Table of Contents alternatives to net income (loss), operating income, income (loss) per diluted share, cash flows from operating activities, total indebtedness, or any other financial measures calculated in accordance with U.S.
Interest expense, net includes interest paid on and debt service costs associated with our various debt instruments, including our First Lien Facilities and Second Lien Facility, and the amortization of related deferred financing fees, which are amortized over the term of the respective credit agreement.
Interest expense, net includes interest paid on and debt service costs associated with our various debt instruments, including our First Lien Facilities, and the amortization of related deferred financing fees, which are amortized over the term of the respective credit agreement.
Each of the end markets that these home and community-based pharmacy services supply and support are growing at attractive rates, and the lack of appropriate pharmacy medication management and resulting non-adherence among complex and polypharmacy patients in homes are significant contributors to ER visits, hospitalizations and increased costs. We have continued to expand our pharmacy capabilities to serve this need.
Each of the end markets that these home and community-based pharmacy services supply and support are growing at attractive rates, and the lack of appropriate pharmacy medication management and resulting non-adherence among complex and polypharmacy patients in homes are significant contributors to ER visits, hospitalizations and increased costs. 63 Table of Contents We have continued to expand our pharmacy capabilities to serve this need.
See Note 1 “Significant Accounting Policies” to our audited consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K for a summary of all of our significant accounting policies. 79 Table of Contents Revenue Recognition The Company recognizes the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers.
See Note 1 “Significant Accounting Policies” to our audited consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K for a summary of all of our significant accounting policies. Revenue Recognition The Company recognizes the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers.
We have excluded defense costs associated with these PharMerica litigation matters from our Adjusted EBITDA and Adjusted EPS due to the magnitude of these cases and the costs attributable to them, the timing of the commencement of the cases and the fact that no similar cases have been brought against the Company since the acquisition of PharMerica, and the fact that these cases are 74 Table of Contents unlike our routine legal and regulatory proceedings that we see in the normal course of business.
We have excluded defense costs associated with these PharMerica litigation matters from our Adjusted EBITDA and Adjusted EPS due to the magnitude of these cases and the costs attributable to them, the timing of the commencement of the cases and the fact that no similar cases have been brought against the Company since the acquisition of PharMerica, and the fact that these cases are unlike our routine legal and regulatory proceedings that we see in the normal course of business.
The First Lien Credit Agreement, as amended, also extends credit in the form of a Revolving Credit Facility, or the Revolver, which is comprised of Revolving Credit Loans and Swingline Loans. The total borrowing capacity of the Revolver as of December 31, 2024 was $475.0 million.
The First Lien Credit Agreement, as amended, also extends credit in the form of a Revolving Credit Facility, or the Revolver, which is comprised of Revolving Credit Loans and Swingline Loans. The total borrowing capacity of the Revolver as of December 31, 2025 was $475.0 million.
In addition, under the Revolving Credit Facility, the Company will not permit the consolidated first lien secured debt to consolidated EBITDA (as defined in the First Lien Credit Agreement) ratio to be greater than 6.90 to 1.00, which shall be tested as of 78 Table of Contents the end of the most recent quarter at any time when the aggregate revolving credit loans exceed 35% of the total revolving credit commitments.
In addition, under the Revolving Credit Facility, the Company will not permit the consolidated first lien secured debt to consolidated EBITDA (as defined in the First Lien Credit Agreement) ratio to be greater than 6.90 to 1.00, which shall be tested as of the end of the most recent quarter at any time when the aggregate revolving credit loans exceed 35% of the total revolving credit commitments.
We currently have 125 limited distribution oncology drugs in the market, with an additional 16 in the pipeline still to launch over the next 12 to 18 months. Home and Community Pharmacy Our home and community-based pharmacy solutions ensure that medications are accessible and clinically supported for patients outside of retail pharmacies.
We currently have 149 limited distribution oncology drugs in the market, with an additional 18 in the pipeline still to launch over the next 12 to 18 months. Home and Community Pharmacy Our home and community-based pharmacy solutions ensure that medications are accessible and clinically supported for patients outside of retail pharmacies.
We believe the Company’s streamlined service offerings will result in increased strategic focus, operational efficiencies, a refined payer mix, and greater clinical integration and business synergy across the Provider Services segment.
We believe the Company’s streamlined service offerings will result in increased strategic focus, operational efficiencies, a refined payor mix, and greater clinical integration and business synergy across the Provider Services segment.
Our future capital requirements will depend on many factors that are difficult to predict, including the size, timing, and structure of any future acquisitions, future 76 Table of Contents capital investments, and future results of operations. We cannot assure you that cash provided by operating activities or cash and cash equivalents will be sufficient to meet our future needs.
Our future capital requirements will depend on many factors that are difficult to predict, including the size, timing, and structure of any future acquisitions, future capital investments, and future results of operations. We cannot assure you that cash provided by operating activities or cash and cash equivalents will be sufficient to meet our future needs.
We elected to perform a qualitative assessment for our intangible assets for our annual impairment test in the fourth quarter of 2024, 2023 and 2022. As a result of our qualitative analyses, we determined that it was more-likely-than-not that the fair values of our indefinite-lived intangible assets were greater than their carrying values.
We elected to perform a qualitative assessment for our intangible assets for our annual impairment test in the fourth quarter of 2025 and 2024. As a result of our qualitative analyses, we determined that it was more-likely-than-not that the fair values of our indefinite-lived intangible assets were greater than their carrying values.
Locations of Operations We are headquartered in Louisville, Kentucky with operations in all 50 states, Puerto Rico, and Canada. We deliver a higher proportion of services in select regions with favorable demographics and regulatory environments.
Locations of Operations We are headquartered in Louisville, Kentucky with operations in all 50 states and Canada. We deliver a higher proportion of services in select regions with favorable demographics and regulatory environments.
Our complex Behavioral clients, often with three or more comorbidities and requiring eight or more medications, are still able to spend 359 days a year at home on average.
Our complex Behavioral clients, often with three or more comorbidities and requiring eight or more medications, are still able to spend 360 days a year at home on average.
Additionally, the Letter of Credit Issuer may issue standby Letters of Credit at any time and the Swingline Lender may issue Swingline Loans in an aggregated amount outstanding not in excess of $65.0 million.
Additionally, the Letter of Credit Issuer may issue standby Letters of Credit at any time and the Swingline Lender may issue Swingline Loans in an aggregate amount outstanding not in excess of $65.0 million.
For example, across our pharmacies we achieve 99.99% order accuracy and 98.63% order completeness, “excellent” and “world class” NPS, a 94% satisfaction rating from infusion patients, and a reduction in hospitalizations with CCRx, while also driving savings through medication adherence and therapeutic interchanges.
For example, across our pharmacies we achieve 99.99% order accuracy and 99.34% order completeness, “excellent” and “world class” NPS, a 94% satisfaction rating from infusion patients, and a reduction in hospitalizations with CCRx, while also driving savings through medication adherence and therapeutic interchanges.
The Company first assesses certain qualitative factors to determine whether the existence of events or circumstances would indicate that it 80 Table of Contents is more-likely-than-not that the fair value of a reporting unit was less than its carrying amount.
The Company first assesses certain qualitative factors to determine whether the existence of events or circumstances would indicate that it is more-likely-than-not that the fair value of a reporting unit was less than its carrying amount.
The Company’s provisions for general and professional and automobile liabilities are recorded on a claims-made basis, which includes estimates of fully developed losses for both reported and unreported claims. Accruals for general and professional and automobile liabilities are based on analyses performed internally by management.
The Company’s provisions for general and professional and automobile liabilities are recorded on a claims-made basis, which includes 78 Table of Contents estimates of fully developed losses for both reported and unreported claims. Accruals for general and professional and automobile liabilities are based on analyses performed internally by management.
On January 17, 2025, the Company entered into a purchase agreement with National Mentor Holding, Inc. to divest the Company's community living services, home and community based waiver programs, and intermediate care facilities (the “Community Living business”), for $835 million, subject to typical adjustments for working capital and other customary items.
Discontinued Operations On January 17, 2025, the Company entered into a purchase agreement with National Mentor Holding, Inc. to divest our community living services, home and community based waiver programs, and intermediate care facilities (the “Community Living business”), for $835 million, subject to typical adjustments for working capital and other customary items.
As noted earlier, the Company announced the entry into a purchase agreement in January 2025 with respect to the expected sale of our Community Living business, which is expected to close in 2025, subject to customary closing conditions. The sale of this business will represent a strategic shift, in fiscal year 2025, from our services to Behavioral populations.
As noted earlier, the Company announced the entry into a purchase agreement in January 2025 with respect to the expected sale of our Community Living business, which is expected to close in the first fiscal quarter of 2026, subject to customary closing conditions. The sale of this business will represent a strategic shift from our services to Behavioral populations.
The legal costs and settlements adjustment represents defense costs associated with certain PharMerica litigation matters, all of which have been finalized as of December 31, 2024, that commenced prior to KKR Stockholder’s and Walgreen Stockholder’s acquisition of PharMerica in December 2017, as well as settlement costs associated with the Silver matter, which settled in November 2023.
The legal costs and settlements adjustment represents defense costs associated with certain PharMerica litigation matters, all of which were finalized in 2024, that commenced prior to KKR Stockholder’s and Walgreen Stockholder’s acquisition of PharMerica in December 2017, as well as settlement costs associated with the Silver matter, which settled in November 2023.
We provide multiple pharmacy and provider services to approximately 20,000 patients today, and we believe that there are substantially more opportunities to deliver more integrated care, given the hundreds of thousands of patients we serve and a similar number of patients discharging from customers annually.
We provide multiple pharmacy and provider services to approximately 8,100 patients today, and we believe that there are substantially more opportunities to deliver more integrated care, given the hundreds of thousands of patients we serve and a similar number of patients discharging from customers annually.
We serve patients from and across approximately 11,300 offices, customer locations and group homes, as well as serving approximately 300,000 patients in their own homes, every day with co-location of our pharmacy and provider services in 40 states. Payor Mix We are characterized by payor diversification across our platform.
We serve patients from and across approximately 7,700 offices, customer locations and group homes, as well as serving approximately 330,000 patients in their own homes, every day with co-location of our pharmacy and provider services in 40 states. Payor Mix We are characterized by payor diversification across our platform.
Our payors are principally federal, state, and local governmental agencies, commercial insurance, private, and other payors. No payor represents more than 30% of our revenue in the aggregate for the years ended December 31, 2024 and 2023.
Our payors are principally federal, state, and local governmental agencies, commercial insurance, private, and other payors. No payor represents more than 35% of our revenue in the aggregate for the years ended December 31, 2025 and 2024.
We achieve 97% patient satisfaction in our outpatient rehab services, and we achieve an 85% overall rating of care in hospice (compared to the national average of 81%), hospitalizations 35% lower than the national average in our home-based primary care, and four stars (out of five) in the CAHPS home health patient survey ratings. 84% of our home health branches have a STAR rating of 4 or higher.
We achieve 100% patient satisfaction in our outpatient rehab services, and we achieve an 87% overall rating of care in hospice (compared to the national average of 81%), hospitalizations 35% lower than the national average in our home-based primary care, and four stars (out of five) in the CAHPS home health patient survey ratings. 91% of our home health branches have a STAR rating of 4 or higher.
Loss on Extinguishment of Debt. Loss on extinguishment of debt reflects the write-off of unamortized debt issuance costs upon the early repayment of our Second Lien Facility. Interest Expense, net .
Loss on Extinguishment of Debt. Loss on extinguishment of debt reflects the write-off of unamortized debt issuance costs upon the early repayment of our Second Lien Facility. 66 Table of Contents Interest Expense, net .
(6) Represents annual management fees payable to the Managers under the Monitoring Agreement through the date of the IPO, and $22.7 million of termination fees resulting from the Monitoring Agreement being terminated upon completion of the IPO Offerings. All management fees have ceased following the completion of the IPO.
(6) Represents annual management fees payable to the Managers under the Monitoring Agreement through the date of the IPO, and $22.7 million of termination fees resulting from the Monitoring Agreement being terminated upon completion of the IPO Offerings.
Our presence spans all 50 states, we serve over 450,000 patients daily through our approximately 11,000 clinical providers and pharmacists, and our services make a profound impact in the lives and communities of the people we serve.
Our presence spans all 50 states, we serve over 465,000 patients daily through our approximately 10,500 clinical providers and pharmacists, and our services make a profound impact in the lives and communities of the people we serve.
The significant projects adjustment represents costs associated with certain transformational projects, which are not considered to be a part of our normal and recurring business operations and are not expected to recur in our future business plans. As of December 31, 2024, all significant projects have been finalized.
The significant projects adjustment represents costs associated with certain transformational projects, which are not considered to be a part of our normal and recurring business operations and are not expected to recur in our future business plans. All significant projects were finalized in 2024.
Pharmacy Solutions Pharmacy Solutions revenues are generated from the products and services provided in association with the distribution of prescription drugs to consumers primarily under contracts with Prescription Drug Plans, or PDPs, under Medicare Part D, state Medicaid programs, long-term care institutions, third party insurance companies, and private payors.
Amounts are adjusted to actual reimbursed amounts based upon cash receipts. Pharmacy Solutions Pharmacy Solutions revenues are generated from the products and services provided in association with the distribution of prescription drugs to consumers primarily under contracts with Prescription Drug Plans, or PDPs, under Medicare Part D, state Medicaid programs, long-term care institutions, third party insurance companies, and private payors.
These services consist of clinical and supportive care to approximately 40,000 Senior and Specialty populations, with both census for Home Health Care services specifically, and rehab hours served, having grown approximately 9% and 13% from December 2023 to December 2024, respectively.
These services consist of clinical and supportive care to approximately 16,000 Senior and Specialty populations, with both census for Home Health Care services specifically, and rehab hours served, having grown approximately 9% and 12% from December 2024 to December 2025, respectively.
To the extent a reporting unit’s carrying amount exceeds its fair value, the reporting unit’s goodwill is deemed impaired, and an impairment charge is recognized based on the excess of a reporting unit’s carrying amount over its fair value. A reporting unit is either an operating segment or one level below the operating segment. The Company has six reporting units.
To the extent a reporting unit’s carrying amount exceeds 77 Table of Contents its fair value, the reporting unit’s goodwill is deemed impaired, and an impairment charge is recognized based on the excess of a reporting unit’s carrying amount over its fair value. A reporting unit is either an operating segment or one level below the operating segment.
The following tables summarize the percentage of revenue generated by each payor type for each of our service offerings and reportable segments: For the Year Ended December 31, 2024 Commercial insurance Medicaid Medicare Part A Medicare Part B Medicare Part C Medicare Part D Private & other Total Infusion and Specialty Pharmacy 18.4 % 5.3 % 0.0 % 0.6 % 13.7 % 19.1 % 0.8 % 57.9 % Home and Community Pharmacy 2.6 % 2.1 % 4.8 % 0.0 % 0.0 % 9.3 % 1.0 % 19.8 % Pharmacy Solutions 21.0 % 7.4 % 4.8 % 0.6 % 13.7 % 28.4 % 1.8 % 77.7 % Home Health Care 0.3 % 2.5 % 4.0 % 0.2 % 1.1 % — 1.2 % 9.3 % Community and Rehab Care 1.5 % 9.6 % 0.0 % 0.0 % 0.0 % — 1.9 % 13.0 % Provider Services 1.8 % 12.1 % 4.0 % 0.2 % 1.1 % — 3.1 % 22.3 % Consolidated BrightSpring 22.8 % 19.5 % 8.8 % 0.8 % 14.8 % 28.4 % 4.9 % 100.0 % For the Year Ended December 31, 2023 Commercial insurance Medicaid Medicare Part A Medicare Part B Medicare Part C Medicare Part D Private & other Total Infusion and Specialty Pharmacy 17.0 % 5.0 % 0.0 % 0.7 % 15.7 % 12.6 % 1.0 % 52.0 % Home and Community Pharmacy 1.8 % 2.4 % 6.2 % 0.0 % 0.0 % 10.4 % 1.1 % 21.9 % Pharmacy Solutions 18.8 % 7.4 % 6.2 % 0.7 % 15.7 % 23.0 % 2.1 % 73.9 % Home Health Care 0.4 % 3.1 % 4.6 % 0.2 % 0.7 % — 1.4 % 10.4 % Community and Rehab Care 1.3 % 11.8 % 0.0 % 0.1 % 0.1 % — 2.4 % 15.7 % Provider Services 1.7 % 14.9 % 4.6 % 0.3 % 0.8 % — 3.8 % 26.1 % Consolidated BrightSpring 20.5 % 22.3 % 10.8 % 1.0 % 16.5 % 23.0 % 5.9 % 100.0 % See Note 2 of the audited consolidated financial statements and related notes in this Form 10-K for information regarding revenue by payor type for each reportable segment for the years ended December 31, 2024 and 2023.
The following tables summarize the percentage of revenue generated by each payor type for each of our service offerings and reportable segments: For the Year Ended December 31, 2025 Commercial insurance Medicaid Medicare Part A Medicare Part B Medicare Part C Medicare Part D Private & other Total Infusion and Specialty Pharmacy 21.4 % 6.6 % 0.0 % 0.6 % 17.6 % 23.3 % 1.0 % 70.5 % Home and Community Pharmacy 2.7 % 1.9 % 4.4 % 0.0 % 0.0 % 8.4 % 0.8 % 18.2 % Pharmacy Solutions 24.1 % 8.5 % 4.4 % 0.6 % 17.6 % 31.7 % 1.8 % 88.7 % Home Health Care 0.2 % 0.3 % 4.0 % 0.0 % 1.1 % — 0.3 % 5.9 % Rehab Care 1.2 % 0.7 % — 0.0 % 0.0 % — 0.4 % 2.3 % Personal Care 0.1 % 2.1 % — — — — 0.9 % 3.1 % Provider Services 1.5 % 3.1 % 4.0 % 0.0 % 1.1 % — 1.6 % 11.3 % Consolidated BrightSpring 25.6 % 11.6 % 8.4 % 0.6 % 18.7 % 31.7 % 3.4 % 100.0 % For the Year Ended December 31, 2024 Commercial insurance Medicaid Medicare Part A Medicare Part B Medicare Part C Medicare Part D Private & other Total Infusion and Specialty Pharmacy 20.5 % 5.9 % 0.0 % 0.7 % 15.4 % 21.4 % 0.9 % 64.8 % Home and Community Pharmacy 2.9 % 2.3 % 5.4 % 0.0 % 0.0 % 10.4 % 1.1 % 22.1 % Pharmacy Solutions 23.4 % 8.2 % 5.4 % 0.7 % 15.4 % 31.8 % 2.0 % 86.9 % Home Health Care 0.3 % 0.3 % 4.5 % 0.3 % 1.2 % — 0.0 % 6.6 % Rehab Care 1.3 % 0.6 % 0.0 % 0.0 % 0.0 % — 0.8 % 2.7 % Personal Care 0.1 % 2.4 % 0.0 % 0.0 % 0.0 % — 1.3 % 3.8 % Provider Services 1.7 % 3.3 % 4.5 % 0.3 % 1.2 % — 2.1 % 13.1 % Consolidated BrightSpring 25.1 % 11.5 % 9.9 % 1.0 % 16.6 % 31.8 % 4.1 % 100.0 % See Note 3 of the audited consolidated financial statements and related notes in this Form 10-K for information regarding revenue by payor type for each reportable segment for the years ended December 31, 2025 and 2024.
Overall, our pharmacy has grown patient census and prescriptions by 12% over the past year. We are a leading independent pharmacy provider in our respective pharmacy patient markets, 65 Table of Contents and we expect to continue to increase our share.
Overall, our pharmacy has grown patient census and prescriptions by 4% over the past year. We are a leading independent pharmacy provider in our respective pharmacy patient markets, and we expect to continue to increase our share.
As of December 31, 2024, we had three interest rate swaps with a combined notional value of $2.0 billion that were designated as cash flow hedges of interest rate risk. See Note 5 “Debt and Derivatives” within the audited consolidated financial statements and related notes, included elsewhere in the Annual Report on Form 10-K.
As of December 31, 2025, our interest rate swaps that were designated as cash flow hedges of interest rate risk had a combined notional value of $1.5 billion. See Note 6 “Debt and Derivatives” within the audited consolidated financial statements and related notes, included elsewhere in the Annual Report on Form 10-K.
The increase primarily resulted from the following segment activity and factors: • an increase of $66.4 million, or 5.2% growth on consolidated 2023 selling, general, and administrative expenses, as a result of growth in our Pharmacy Solutions and Provider Services segments.
The increase primarily resulted from the following segment activity and factors: • an increase of $74.0 million, or 6.4%, on consolidated 2024 selling, general, and administrative expenses, as a result of growth in our Pharmacy Solutions and Provider Services segments.
See Note 17 “Segment Information” to our audited consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K for further discussion. Provider Services Segment The following table sets forth, for the years indicated, our segment results of operations.
The increase primarily resulted from the aforementioned revenue and gross profit growth in the period. See Note 17 “Segment Information” to our audited consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K for further discussion. Provider Services Segment The following table sets forth, for the years indicated, our segment results of operations.
Infusion and Specialty Pharmacy prescriptions and Home and Community Pharmacy prescriptions have grown at more than 22% and 11%, respectively, from December 2023 to December 2024. We have a unique opportunity to increasingly provide more pharmacy services in the future to provider patients and patients transitioning across settings of care.
Infusion and Specialty Pharmacy prescriptions and Home and Community Pharmacy prescriptions have grown at more than 27% and 3%, respectively, from December 2024 to December 2025. We have a unique opportunity to increasingly provide more 60 Table of Contents pharmacy services in the future to provider patients and patients transitioning across settings of care.
Additionally, our Medicaid payors can be further broken down across each individual state with our top 10 Medicaid states representing 12% and 14% of total Company revenue for the year ended December 31, 2024 and 2023, respectively.
Additionally, our Medicaid payors can be further broken down across each individual state with our top 10 Medicaid states representing 6% of total Company revenue for the years ended December 31, 2025 and 2024.
The decrease in gross profit margin is due to mix shift in the Pharmacy Solutions segment with greater relative volume growth in Infusion and Specialty Pharmacy, along with product-level mix shifts, rate changes, an increase in the fulfillment cost per script in Home and Community Pharmacy, and the QIP received in 2023 for which there was no comparable in 2024.
The decrease in gross profit margin is due to mix shift in the Pharmacy Solutions segment with greater relative volume growth in Infusion and Specialty Pharmacy, along with product-level mix shifts, rate changes, and an increase in the fulfillment cost per script in Home and Community Pharmacy.
The Company expects the divestiture to close in 2025, subject to customary closing conditions. This transaction provides for continuity of important intellectual and developmental disability services while BrightSpring focuses on a concentrated group of customers, patients and stakeholders in the future.
We expect the divestiture to close in the first fiscal quarter of 2026, subject to customary closing conditions. This transaction provides for continuity of important intellectual and developmental disability services while the Company focuses on a concentrated group of customers, patients and stakeholders in the future.
The year ended December 31, 2024 includes $49.2 million of costs related to new equity awards granted upon the completion of our IPO under the 2024 Equity Incentive Plan and $15.0 million of previously unrecognized share-based compensation expense related to performance-vesting options under the 2017 Stock Plan, a portion of which vested upon completion of the IPO.
The year ended December 31, 2024 includes $15.0 million of previously unrecognized share-based compensation expense related to performance-vesting options under the 2017 Stock Plan, a portion of which vested upon completion of the IPO.
Refer to Note 6 within our consolidated financial statements and related notes in this Annual Report on Form 10-K for further discussion. Our outstanding debt as of December 31, 2024 was $2,683.3 million, which is primarily comprised of $2,546.8 million outstanding under the First Lien Facility, $63.3 million outstanding under the Revolver, and $53.8 million outstanding related to Amortizing Notes.
Refer to Note 7 within our consolidated financial statements and related notes in this Annual Report on Form 10-K for further discussion. Our outstanding debt as of December 31, 2025 was $2,569.7 million, which is primarily comprised of $2,521.3 million outstanding under the First Lien Facility and $31.4 million outstanding related to Amortizing Notes.
Revenue attributable to Infusion and Specialty Pharmacy was $6,526.0 million for the year ended December 31, 2024, as compared with $4,600.9 million for the year ended December 31, 2023, an increase of $1,925.1 million or 41.8% attributable to an increase in prescriptions dispensed on certain specialty branded drugs.
Revenue attributable to Infusion and Specialty Pharmacy was $9,095.9 million for the year ended December 31, 2025, as compared with $6,526.0 million for the year ended December 31, 2024, an increase of $2,569.9 million or 39.4% attributable to an increase in prescriptions dispensed on certain specialty branded drugs.
The increase primarily resulted from the aforementioned revenue growth in the period as well as an increase in cost per prescription dispensed as a result of mix shift. Gross profit was $745.8 million for the year ended December 31, 2024, as compared with $681.7 million for the year ended December 31, 2023, an increase of $64.0 million or 9.4%.
The increase primarily resulted from the aforementioned revenue growth in the period as well as an increase in cost per prescription dispensed as a result of mix shift. Gross profit was $938.3 million for the year ended December 31, 2025, as compared with $745.8 million for the year ended December 31, 2024, an increase of $192.6 million or 25.8%.
Adjusted EBITDA (1) $ 588,075 $ 537,808 $ 50,267 9.3 % * n.m.: not meaningful (1) Reconciliation of GAAP to non-GAAP results is provided in the section “Non-GAAP Financial Measures” in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations ” The following discussion of our results of operations should be read in conjunction with the foregoing table summarizing our consolidated results of operations.
Adjusted EBITDA (1) $ 617,570 $ 460,220 $ 157,350 34.2 % * n.m.: not meaningful (1) Reconciliation of GAAP to non-GAAP results is provided in the section “Non-GAAP Financial Measures” in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations ” The following discussion of our results of operations should be read in conjunction with the foregoing table summarizing our consolidated results of operations.
The increase primarily resulted from volume growth in prescriptions dispensed across and within the Pharmacy Solutions segment.
The increase primarily resulted from an increase in revenue per prescription dispensed, as well as volume growth in prescriptions dispensed across and within Pharmacy Solutions segment.
The following table summarizes the revenues generated by each of our reportable segments for the most recent two years: For the Years Ended December 31, ($ in millions) 2024 2023 Revenue % of Revenue Revenue % of Revenue Pharmacy Solutions $ 8,754.3 77.7 % $ 6,522.5 73.9 % Provider Services 2,512.2 22.3 % 2,303.7 26.1 % Consolidated $ 11,266.5 100.0 % $ 8,826.2 100.0 % Pharmacy Solutions We opportunistically provide pharmacy services when and where demanded and as required to customers and patients in their homes and communities, often in coordination with our provider services.
The following table summarizes the revenues generated by each of our reportable segments for the most recent two years: For the Years Ended December 31, ($ in millions) 2025 2024 Revenue % of Revenue Revenue % of Revenue Pharmacy Solutions $ 11,445.8 88.7 % $ 8,754.3 86.9 % Provider Services 1,464.8 11.3 % 1,317.9 13.1 % Consolidated BrightSpring $ 12,910.6 100.0 % $ 10,072.2 100.0 % Pharmacy Solutions We opportunistically provide pharmacy services when and where demanded and as required to customers and patients in their homes and communities, often in coordination with our provider services.
Culture of Quality and Compliance and Consistent Operations Execution Quality and compliance are central to our strategies and mission. We have demonstrated leading and excellent service and customer/patient/family satisfaction scores across the organization, as referenced in prior and other sections of this Annual Report on Form 10-K.
We have demonstrated leading and excellent service and customer/patient/family satisfaction scores across the organization, as referenced in prior and other sections of this Annual Report on Form 10-K.
We paid $110.0 million of the settlement in 2024, and the remainder will be paid in 2025.The District Court entered an order dismissing the Silver action in its entirety, with prejudice, on July 3, 2024.
The total financial impact of the settlement was $120.0 million; $110.0 million of the settlement was paid in 2024, and the remaining $10.0 million was paid in 2025. The District Court entered an order dismissing the Silver action in its entirety, with prejudice, on July 3, 2024.
The increase primarily resulted from volume growth as well as rate increases received during the period. Revenue attributable to Home Health Care was $1,041.3 million for the year ended December 31, 2024, as compared with $921.4 million for the year ended December 31, 2023, an increase of $119.9 million or 13.0%.
The increase primarily resulted from volume growth as well as rate increases received during the period. Revenue attributable to Home Health Care was $767.9 million for the year ended December 31, 2025, as compared with $655.4 million for the year ended December 31, 2024, an increase of $112.5 million or 17.2%.
(3) For the year ended December 31, 2024, the income tax impact on adjustments is inclusive of a discrete tax benefit related to the Silver matter that was finalized in connection with the signing of the settlement agreement during the second fiscal quarter of 2024. Liquidity and Capital Resources Our principal sources of cash have historically been from operating activities.
For the year ended December 31, 2024, the income tax impact on adjustments is inclusive of a discrete tax benefit related to the Silver matter that was finalized in connection with the signing of the settlement agreement during the second fiscal quarter of 2024.
Revenues Revenues were $11,266.5 million for the year ended December 31, 2024, as compared with $8,826.2 million for the year ended December 31, 2023, an increase of $2,440.3 million or 27.6%. The increase resulted from growth in our Pharmacy Solutions and Provider Services segments. See additional discussion in “—Segment Results of Operations” below.
Revenues Revenues were $12,910.6 million for the year ended December 31, 2025, as compared with $10,072.2 million for the year ended December 31, 2024, an increase of $2,838.4 million or 28.2%. The increase resulted from growth in our Pharmacy Solutions and Provider Services segments. See additional discussion in “—Segment Results of Operations” below.
The divestiture will also augment the Company’s expected Revenue and Adjusted EBITDA growth rates and maximize exposure to target growth markets that require BrightSpring’s needed and valuable solutions, such as home health, rehab, primary care, and hospice. The Company expects to account for this sale as a strategic shift in fiscal year 2025.
The divestiture will also augment the Company’s expected Revenue and Adjusted EBITDA growth rates and maximize exposure to target growth markets that require the Company's needed and valuable solutions, such as home health, rehab, primary care, and hospice.
GAAP net loss per share 192,997 117,868 Weighted average common shares outstanding used in calculating diluted Non-GAAP earnings per share 202,106 126,355 (1) This adjustment reflects the per share impact of the adjustment reflected within the definition of Adjusted EBITDA. (2) The income tax impact of non-GAAP adjustments is calculated using the estimated tax rate for the respective non-GAAP adjustment.
GAAP net income (loss) per share 219,774 192,997 Weighted average common shares outstanding used in calculating diluted Non-GAAP earnings per share 219,774 202,106 (1) This adjustment reflects the per share impact of the adjustment reflected within the definition of Adjusted EBITDA.
The following table reconciles diluted EPS to Adjusted EPS: (shares in thousands) For the Years Ended December 31, 2024 2023 Diluted EPS $ (0.09 ) $ (1.31 ) Non-cash share-based compensation (1) 0.34 0.03 Acquisition, integration, and transaction-related costs (1) 0.17 0.16 Restructuring and divestiture-related and other costs (1) 0.19 0.17 Legal costs and settlements (1) 0.11 1.01 Significant projects (1) 0.01 0.07 Management fee (1) 0.12 0.04 Unreimbursed COVID-19 related costs (1) — 0.00 Income tax impact on adjustments (2)(3) (0.29 ) (0.10 ) Adjusted EPS $ 0.56 $ 0.07 Weighted average common shares outstanding used in calculating diluted U.S.
All management fees ceased following the completion of the IPO in 2024. 72 Table of Contents The following table reconciles diluted EPS to Adjusted EPS: (shares in thousands) For The Years Ended December 31, 2025 2024 Diluted EPS $ 0.48 $ (0.34 ) Non-cash share-based compensation (1) 0.27 0.30 Acquisition, integration, and transaction-related costs (1) 0.18 0.16 Restructuring and divestiture-related and other costs (1) 0.27 0.31 Legal costs and settlements (1) — 0.11 Significant projects (1) — 0.01 Management fee (1) — 0.12 Income tax impact on adjustments (2) (0.20 ) (0.32 ) Adjusted EPS $ 1.00 $ 0.35 Weighted average common shares outstanding used in calculating diluted U.S.
Investing Activities Net cash used in investing activities increased by $5.8 million, from $134.4 million in 2023, to $140.2 million in 2024. The increase was primarily due to a $7.4 million increase in purchases of property and equipment and a decrease of $3.3 million cash paid for acquisitions.
Investing Activities Net cash used in investing activities increased by $164.8 million, from $140.2 million in 2024, to $305.1 million in 2025. The increase was primarily due to a $14.6 million increase in purchases of property and equipment and an increase of $144.8 million in cash paid for acquisitions.
The increase primarily resulted from the aforementioned revenue growth and included operational improvements resulting in lower costs of services increases compared to revenue growth. Gross profit was $842.7 million for the year ended December 31, 2024, as compared with $752.1 million for the year ended December 31, 2023, an increase of $90.6 million or 12.0%.
Cost of Services Cost of services was $885.4 million for the year ended December 31, 2025, as compared with $797.3 million for the year ended December 31, 2024, an increase of $88.1 million or 11.0%. The increase primarily resulted from the aforementioned revenue growth and included operational improvements resulting in lower cost of services increases compared to revenue growth.
The Company filled over 41 million prescriptions in 2024 from over 180 pharmacies across all 50 states, with services delivered to approximately 7,100 customer locations, more than 60,000 individual or group homes, and over 400,000 patients, all through over 4,700 unique customer and payor contracts.
The Company filled over 43 million prescriptions in 2025 from over 175 pharmacies across all 50 states, with services delivered to approximately 6,600 customer locations, approximately 73,000 individual or group homes, and over 410,000 patients, all through over 4,500 unique customer and payor contracts.
Due to the medical necessity of our services, which are lower cost than healthcare services provided in other settings and reduce ER, hospital and institutional facility utilization, we have a history of reimbursement stability characterized by low-to-mid single digit rate increases across our lines of business from 2014 to 2022.
Due to the medical necessity of our services, which are lower cost than healthcare services provided in other settings and reduce ER, hospital and institutional facility utilization, we have a history of reimbursement stability across our lines of business. Culture of Quality and Compliance and Consistent Operations Execution Quality and compliance are central to our strategies and mission.
We also provide physical, emotional, and spiritual comfort and support primarily for Senior patients with terminal illnesses and their families through our hospice services. Like patients receiving home health care, our interdisciplinary hospice teams tailor individualized plans for patients and their families based on a comprehensive understanding of their needs.
Like patients receiving home health care, our interdisciplinary hospice teams tailor individualized plans for patients and their families based on a comprehensive understanding of their needs. Our hospice patients require important daily pharmacy support, which we deliver through our pharmacy services.
Cost of Services Cost of services was $1,669.5 million for the year ended December 31, 2024, as compared with $1,551.7 million for the year ended December 31, 2023, an increase of $117.9 million or 7.6%. The increase resulted from an increase in Provider Services cost of services. See additional discussion in “—Segment Results of Operations” below.
See additional discussion in “—Segment Results of Operations” below. 67 Table of Contents Cost of Services Cost of services was $885.4 million for the year ended December 31, 2025, as compared with $797.3 million for the year ended December 31, 2024, an increase of $88.1 million or 11.0%. The increase resulted from an increase in Provider Services cost of services.
These costs also included $6.4 million and $4.7 million of costs related to the IPO Offerings which were not capitalizable for the years ended December 31, 2024 and 2023, respectively. (3) Represents costs associated with restructuring-related activities, including closure costs, and related license impairment, and severance expenses associated with certain enterprise-wide or significant business line cost-savings measures.
The years ended December 31, 2025 and 2024 included other non-routine transaction costs of $26.8 million and $5.8 million, respectively. (3) Represents costs associated with restructuring-related activities, including closure costs, and related license impairment, and severance expenses associated with certain enterprise-wide or significant business line cost-savings measures.

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