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

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Paragraph-level year-over-year comparison of Ardent Health, 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.

+545 added−537 removedSource: 10-K (2026-03-16) vs 10-K (2025-02-27)

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

545 paragraphs added · 537 removed · 424 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

169 edited+27 added−36 removed312 unchanged
Biggest changeWe believe that this approach enhances our market share, contributes to a higher quality of care for our patients, increases our operational efficiency, and drives revenue and earnings growth. 2 We operate health systems in the following markets: Health System Market (City, State) (1) Hospitals Operated (2) Total Sites of Care Providers (3) Licensed Beds Leased Hospitals Estimated Market Share (4) Market Population (5) Population Growth (5) Median Income (5) UT Health East Texas Tyler, TX 9 (6) 74 503 868 1 21.7% ^ 983,245 6 % $ 57,485 Hillcrest HealthCare System Tulsa, OK 8 82 476 1,173 8 22.9% ^ 1,130,250 1 % $ 58,642 Lovelace Health System Albuquerque, NM 5 38 292 619 5 15.8% † 1,537,784 4 % $ 60,171 Hackensack Meridian Medical Centers Montclair/Westwood, NJ 2 27 139 476 1 22.0% ^ 546,933 (1 %) $ 121,871 BSA Health System Amarillo, TX 3 18 121 485 1 42.0% * 579,878 5 % $ 59,243 Portneuf Medical Center Pocatello, ID 1 12 129 199 0 59.0% * 136,351 6 % $ 63,055 UKHS St.
Biggest changeWe operate health systems in the following markets (as of December 31, 2025): Health System Market (City, State) (1) Hospitals Operated (2) Total Sites of Care Providers (3) Licensed Beds Leased Hospitals Estimated Market Share (4) Market Population (5) Population Growth (5) Median Income (5) UT Health East Texas Tyler, TX 9 (6) 74 571 868 1 23.4% ^ 1,134,121 3 % $ 66,420 Hillcrest HealthCare System Tulsa, OK 8 82 511 1,173 8 24.5% ^ 1,518,773 2 % $ 64,759 Lovelace Health System Albuquerque, NM 5 38 314 619 5 14.6% † 1,942,608 2 % $ 65,834 Hackensack Meridian Medical Centers Montclair/Westwood, NJ 2 27 155 476 1 51.7% * 543,770 0 % $ 139,718 BSA Health System Amarillo, TX 3 20 126 485 1 53.6% * 460,326 1 % $ 66,149 Portneuf Medical Center Pocatello, ID 1 14 137 199 0 58.4% * 208,167 4 % $ 72,022 UKHS St.
Item 1. Business Overview Ardent Health Partners, Inc. was initially formed in Delaware in 2015 as Ardent Health Partners, LLC. On July 17, 2024, Ardent Health Partners, LLC converted from a Delaware limited liability company into a Delaware corporation in connection with its initial public offering and changed its name to Ardent Health Partners, Inc.
Item 1. Business Overview Ardent Health, Inc. was initially formed in Delaware in 2015 as Ardent Health Partners, LLC. On July 17, 2024, Ardent Health Partners, LLC converted from a Delaware limited liability company into a Delaware corporation in connection with its initial public offering and changed its name to Ardent Health Partners, Inc.
Supplemental payments may also be in the form of non-DSH payments, such as upper payment limit payments, which are intended to address the difference between Medicaid fee-for-service payments and Medicare reimbursement rates, or payments under other programs that vary by state under Section 1115 waivers.
Medicaid supplemental payments may also be in the form of non-DSH payments, such as upper payment limit payments, which are intended to address the difference between Medicaid fee-for-service payments and Medicare reimbursement rates, or payments under other programs that vary by state under Section 1115 waivers.
Accountable Care Organizations and Bundled Payment Initiatives With the aim of reducing healthcare costs by improving quality and operational efficiency, accountable care organizations ("ACOs") are gaining traction in both the public and private sectors.
Accountable Care Organizations and Bundled Payment Initiatives With the aim of reducing healthcare costs by improving quality and operational efficiency, ACOs are gaining traction in both the public and private sectors.
Violations of the Anti-Kickback Statute may result in substantial criminal fines for each violation, imprisonment, substantial civil monetary penalties per violation that are subject to annual adjustment based on updates to the consumer price index, and damages of up to three times the total amount of the remuneration and/or mandatory exclusion from participation in government healthcare programs, including Medicare and Medicaid.
Violations of the Anti-Kickback Statute may result in substantial criminal fines for each violation, imprisonment, substantial civil 19 monetary penalties per violation that are subject to annual adjustment based on updates to the consumer price index, and damages of up to three times the total amount of the remuneration and/or mandatory exclusion from participation in government healthcare programs, including Medicare and Medicaid.
We believe that our provider network, integrated technology, ambulatory investments, and strong quality of care programs position us to succeed in this environment. 7 Our Competitive Strengths Over our more than 20 years of experience, we have developed a core competency for efficiently and effectively operating healthcare facilities and physician groups to provide high-quality patient care that exceeds CMS benchmarks.
We believe that our provider network, integrated technology, ambulatory investments, and strong quality of care programs position us to succeed in this environment. Our Competitive Strengths Over our more than 20 years of experience, we have developed a core competency for efficiently and effectively operating healthcare facilities and physician groups to provide high-quality patient care that exceeds CMS benchmarks.
In some states where we operate hospitals and other healthcare facilities, the construction or expansion of healthcare facilities, the acquisition of existing facilities, the transfer or change of ownership, capital expenditures exceeding a prescribed amount and the 19 addition of new beds or services may be subject to review by and prior approval of, or notifications to, state regulatory agencies under a CON program.
In some states where we operate hospitals and other healthcare facilities, the construction or expansion of healthcare facilities, the acquisition of existing facilities, the transfer or change of ownership, capital expenditures exceeding a prescribed amount and the addition of new beds or services may be subject to review by and prior approval of, or notifications to, state regulatory agencies under a CON program.
Additionally, regular touchpoints with our patients using channels such as email, chat, text, and Epic’s MyChart app allow us to stay engaged with patients and deliver care when and where needed. Continued deployment of emerging technologies provides support from the bedside to the home, making it easier for us to deliver care to patients across all settings.
Additionally, regular touchpoints with our patients using channels such as email, chat, text, and Epic’s MyChart app allow us to stay engaged with patients and deliver care when and where needed. 7 Continued deployment of emerging technologies provides support from the bedside to the home, making it easier for us to deliver care to patients across all settings.
Several industry dynamics favor consolidation in the hospital sector, including: (i) hospital systems facing increased financial pressures due to a lack of scale; (ii) hospital systems struggling to recruit medical providers 6 given the significant competition for clinical talent; and (iii) hospital systems experiencing the inability to support continued investments in new services, facilities, and technology.
Several industry dynamics favor consolidation in the hospital sector, including: (i) hospital systems facing increased financial pressures due to a lack of scale; (ii) hospital systems struggling to recruit medical providers given the significant competition for clinical talent; and (iii) hospital systems experiencing the inability to support continued investments in new services, facilities, and technology.
Failure to refund amounts received as a result of a prohibited referral on a timely basis may constitute a false or fraudulent claim and may result in civil penalties and additional penalties under the FCA. The statute also provides for a penalty for a circumvention scheme. These penalties are updated annually based on changes to the consumer price index.
Failure to refund amounts received as a result of a prohibited referral on a timely basis may constitute a false or fraudulent claim and may result in civil penalties and additional penalties under the FCA. The statute also 20 provides for a penalty for a circumvention scheme. These penalties are updated annually based on changes to the consumer price index.
For example, healthcare providers and certain other entities are subject to information blocking restrictions pursuant to the 21st Century Cures Act that prohibit practices that are likely to interfere with the access, exchange or use of electronic health information, except as required by law or specified by HHS as a reasonable and necessary activity.
For example, healthcare providers and certain other entities are subject to information blocking restrictions pursuant to the 21st Century Cures Act that prohibit practices that are likely to interfere with the access, exchange or use of electronic health information, except as required by law or specified by HHS as a reasonable and necessary 23 activity.
For example, HHS has the ability to exclude from Medicare and Medicaid any business entities and any investors, officers 24 and managing employees associated with business entities that have committed healthcare fraud, even if the officer or managing employee had no knowledge of the fraud. This standard does not require that specific intent to defraud.
For example, HHS has the ability to exclude from Medicare and Medicaid any business entities and any investors, officers and managing employees associated with business entities that have committed healthcare fraud, even if the officer or managing employee had no knowledge of the fraud. This standard does not require that specific intent to defraud.
States are increasingly using SDP arrangements, and the use of SDP arrangements may decrease state utilization of other supplemental payment programs, diverting or reducing previously-available funding for certain providers. SDP arrangements can be limited to a specific subset of providers, and providers that do not satisfy applicable criteria may 16 be ineligible for payments.
States are increasingly using SDP arrangements, and the use of SDP arrangements may decrease state utilization of other supplemental payment programs, diverting or reducing previously-available funding for certain providers. SDP arrangements can be limited to a specific subset of providers, and providers that do not satisfy applicable criteria may be ineligible for payments.
We maintain the availability of personal protective equipment and disinfection supplies and regularly provide current infection prevention guidance. 28 Workplace Culture and Development We believe bringing people together from all walks of life supports better care and stronger communities and are dedicated to building and developing teams that reflect the communities we serve.
We maintain the availability of personal protective equipment and disinfection supplies and regularly provide current infection prevention guidance. Workplace Culture and Development We believe bringing people together from all walks of life supports better care and stronger communities and are dedicated to building and developing teams that reflect the communities we serve.
We base the compensation for each local management team in part on its ability to achieve the clinical quality and financial goals set forth in the annual operating plan. 10 Boards of trustees at our hospitals, consisting of local community leaders, members of the medical staff and members of the local management team provide community leadership and guidance to our hospitals.
We base the compensation for each local management team in part on its ability to achieve the clinical quality and financial goals set forth in the annual operating plan. Boards of trustees at our hospitals, consisting of local community leaders, members of the medical staff and members of the local management team provide community leadership and guidance to our hospitals.
Instead of ordering HHS to pay 340B hospitals the difference between the rates under the 2018 payment policy and what should have been paid, the United States District Court for the District of Columbia allowed HHS to develop an appropriate remedy to address underpayments to 340B hospitals that resulted from the policy in 14 past payment years.
Instead of ordering HHS to pay 340B hospitals the difference between the rates under the 2018 payment policy and what should have been paid, the United States District Court for the District of Columbia allowed HHS to develop an appropriate remedy to address underpayments to 340B hospitals that resulted from the policy in past payment years.
There are ownership and compensation arrangement exceptions to the self-referral prohibition. There are exceptions for many of the customary financial arrangements between physicians and providers, including employment contracts, leases and recruitment 22 agreements. A financial relationship must comply with every requirement of a Stark Law exception or the arrangement is in violation of the Stark Law.
There are ownership and compensation arrangement exceptions to the self-referral prohibition. There are exceptions for many of the customary financial arrangements between physicians and providers, including employment contracts, leases and recruitment agreements. A financial relationship must comply with every requirement of a Stark Law exception or the arrangement is in violation of the Stark Law.
In addition, the members of the JV Board appointed by our partner have unilateral and exclusive authority to make certain decisions that are essential to the maintenance of the status of our JV partner as a 501(c)(3) organization or to ensure that the JV complies with the Community Benefit Standards (as defined below), such as the right to (i) name the chairman of the JV Board, (ii) cause the dissolution of the JV in the event the JV fails to satisfy the “community benefit standards” set forth in IRS Revenue Ruling 69-545 (the “Community Benefit Standards”), (iii) terminate the Chief Executive Officer of the JV or the Chief Executive Officer of the hospital operated by the JV due to the failure of such Chief Executive Officer to ensure that the JV is operating consistently with the Community Benefit Standards and (iv) terminate the JV’s Management Services Agreement (as described below) with us in the event 4 that our provision of services results in failure to satisfy the Community Benefit Standards.
In addition, the members of the JV Board appointed by our partner have unilateral and exclusive authority to make certain decisions that are essential to the maintenance of the status of our JV partner as a 501(c)(3) organization or to ensure that the JV complies with the Community Benefit Standards (as defined below), such as the right to (i) name the chairman of the JV Board, (ii) cause the dissolution of the JV in the event the JV fails to satisfy the “community benefit standards” set forth in IRS Revenue Ruling 69-545 (the “Community Benefit Standard”), (iii) terminate the Chief Executive Officer of the JV or the Chief Executive Officer of the hospital operated by the JV due to the failure of such Chief Executive Officer to ensure that the JV is operating consistently with the Community Benefit Standards and (iv) terminate the JV’s Management Services Agreement (as described below) with us in the event that our provision of services results in failure to satisfy the Community Benefit Standards.
Under the RAC program, CMS contracts with Recovery Audit Contractors ("RACs") nationwide to conduct post-payment reviews to detect and correct improper payments in the fee-for-service Medicare program, as required by statute. RACs review claims submitted to Medicare for billing compliance, including correct coding and medical necessity.
Under the RAC program, CMS contracts with Recovery Audit Contractors (“RACs”) nationwide to conduct post-payment reviews to detect and correct improper payments in the fee-for-service Medicare program, as required by statute. RACs review claims submitted to Medicare for billing compliance, including correct coding and medical necessity.
Healthcare facility construction and operation are subject to numerous federal, state and local regulations relating to the adequacy of medical care, equipment, personnel, operating policies and procedures, maintenance of adequate records, dispensing narcotics, handling radioactive materials, fire prevention, rate-setting, building codes and environmental protection.
Healthcare facility construction and operation are subject to numerous federal, state and local regulations relating to the adequacy of medical care, equipment, personnel, operating policies and procedures, maintenance of adequate records, dispensing narcotics, 17 handling radioactive materials, fire prevention, rate-setting, building codes and environmental protection.
These programs not only build a pipeline of skilled providers, but also strengthen healthcare delivery in underserved areas. Our partnerships with colleges and universities add hundreds of new graduates to our teams and our intern and extern programs provide hands-on clinical training to aspiring nurses.
These programs not only build a pipeline of skilled providers, but also strengthen healthcare 25 delivery in underserved areas. Our partnerships with colleges and universities add hundreds of new graduates to our teams and our intern and extern programs provide hands-on clinical training to aspiring nurses.
The HHS Office of Inspector General ("OIG") is one entity responsible for identifying and investigating fraud and abuse activities in federal healthcare programs. The OIG has promulgated “safe harbor” regulations that shield arrangements that fully comply with a safe harbor from prosecution.
The HHS Office of Inspector General (“OIG”) is one entity responsible for identifying and investigating fraud and abuse activities in federal healthcare programs. The OIG has promulgated “safe harbor” regulations that shield arrangements that fully comply with a safe harbor from prosecution.
Disproportionate Share Hospital ("DSH") payment adjustments are determined annually based on certain statistical information required by HHS and are paid as a percentage addition to MS-DRG payments. The methodology for calculating DSH payment adjustments is affected by shifts in payment policy.
Disproportionate Share Hospital (“DSH”) payment adjustments are determined annually based on certain statistical information required by HHS and are paid as a percentage addition to MS-DRG payments. The methodology for calculating DSH payment adjustments is affected by shifts in payment policy.
HHS may resolve HIPAA violations through informal means, such as allowing a covered entity to implement a corrective action plan, 25 but HHS has the discretion to move directly to impose monetary penalties and is required to impose penalties for violations resulting from willful neglect.
HHS may resolve HIPAA violations through informal means, such as allowing a covered entity to implement a corrective action plan, but HHS has the discretion to move directly to impose monetary penalties and is required to impose penalties for violations resulting from willful neglect.
EMTALA The Emergency Medical Treatment and Labor Act ("EMTALA") is a federal law that imposes requirements regarding the care that must be provided to anyone seeking care who comes to a facility that provides emergency medical services before that individual may be transferred to another facility or otherwise denied care.
EMTALA The Emergency Medical Treatment and Labor Act (“EMTALA”) is a federal law that imposes requirements regarding the care that must be provided to anyone seeking care who comes to a facility that provides emergency medical services before that individual may be transferred to another facility or otherwise denied care.
We believe that the ability of the local management team to identify and meet the needs of our patients, medical staff and the community is critical to the success of our hospitals and allows our local providers and clinical staff to provide the quality and level of care needed for the patients they are treating.
We believe that the ability of the local management team to identify and meet the needs of our patients, medical staff and the community is critical to the success of our hospitals and allows our local providers and 9 clinical staff to provide the quality and level of care needed for the patients they are treating.
Further, one of our affiliates manages all of the assets described above, including the UT Health North Campus Tyler, pursuant to an MSA. • Our JV with Physicians Surgical Hospitals, LLC ("PSH") is different than the other JVs in that decisions of the JV Board are made by majority vote and not block voting, except that a vote of our member and physician members holding at least 67% of the ownership interests in PSH is required to take certain actions for the JV, including a merger or sale of substantially all of the JV’s assets, liquidating or dissolving the JV, making a material change in the JV’s business of operating surgical specialty hospitals, incurring debt over $3 million, requiring additional capital calls and amending the LLC Agreement for the JV. • Our JV with Tulsa Spine & Specialty Hospital ("TSSH") is different than the other JVs in that we can appoint up to eight managers and the physicians can appoint up to 14 managers to the JV Board.
Further, one of our affiliates manages all of the assets described above, including the UT Health North Campus Tyler, pursuant to an MSA. • Our JV with Physicians Surgical Hospitals, LLC (“PSH”) is different than the other JVs in that decisions of the JV Board are made by majority vote and not block voting, except that a vote of our member and physician members holding at least 67% of the ownership interests in PSH is required to take certain actions for the JV, including a merger or sale of substantially all of the JV’s assets, liquidating or dissolving the JV, making a material change in the JV’s business of operating surgical specialty hospitals, incurring debt over $3 million, requiring additional capital calls and amending the LLC Agreement for the JV. • Our JV with Tulsa Spine & Specialty Hospital (“TSSH”) is different than the other JVs in that we can appoint up to eight managers and the physicians can appoint up to 14 managers to the JV Board.
In addition, we could be affected by climate change to the extent that climate change results in severe weather conditions or other disruptions impacting the communities in which our facilities are located or adversely impacts general economic conditions, including in 27 communities in which our facilities are located.
In addition, we could be affected by climate change to the extent that climate change results in severe weather conditions or other disruptions impacting the communities in which our facilities are located or adversely impacts general economic conditions, including in communities in which our facilities are located.
In the short term, the Loper Bright decision has introduced significant regulatory uncertainty, increasing the powers of the courts in the context of regulatory oversight, delaying or halting ongoing agency rulemaking processes, and prompting modifications or reversals of longstanding agency policy.
In the short term, the Loper Bright decision has introduced significant regulatory uncertainty, increasing the powers of the courts in the context of regulatory oversight, delaying or halting ongoing agency rulemaking processes, and prompting modifications or reversals of 18 longstanding agency policy.
Anti-Kickback Statute The federal Anti-Kickback Statute (the "Anti-Kickback Statute") is a criminal law that prohibits, among other things, persons and entities from knowingly and willfully soliciting, offering, paying, receiving or providing remuneration, directly or indirectly, in cash or in 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, in whole or in part, under a federal healthcare program, such as Medicare and Medicaid.
Anti-Kickback Statute The federal Anti-Kickback Statute (the “Anti-Kickback Statute”) is a criminal law that prohibits, among other things, persons and entities from knowingly and willfully soliciting, offering, paying, receiving or providing remuneration, directly or indirectly, in cash or in 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, in whole or in part, under a federal healthcare program, such as Medicare and Medicaid.
We have been recognized as an employer of choice by numerous organizations including Modern Healthcare , The Tennessean and Comparably . Our scale provides a significant opportunity to capture market share.
We have been recognized as an employer of choice by numerous organizations including Modern Healthcare and The Tennessean . Our scale provides a significant opportunity to capture market share.
For example, providers participating in bundled payment initiatives agree to receive one payment for services provided to Medicare patients for certain medical conditions or 18 episodes of care, accepting accountability for costs and quality of care.
For example, providers participating in bundled payment initiatives agree to receive one payment for services provided to Medicare patients for certain medical conditions or episodes of care, accepting accountability for costs and quality of care.
Francis Campus in Topeka, Kansas; Pascack Valley Medical Center in Westwood, New Jersey; Physicians Surgical Hospitals in Amarillo, Texas; Seton Medical Center Harker Heights in Harker Heights, Texas; UT Health Henderson in Henderson, Texas; UT Health Jacksonville in Jacksonville, Texas; and UT Health Tyler in Tyler, Texas.
Francis Campus in Topeka, Kansas; Pascack Valley Medical Center in Westwood, New Jersey; Physicians Surgical Hospitals in Amarillo, Texas; Seton Medical Center Harker Heights in Killeen, Texas; UT Health Henderson in Henderson, Texas; UT Health Jacksonville in Jacksonville, Texas; and UT Health Tyler in Tyler, Texas.
This ecosystem of care—which includes digital engagement and virtual appointments, remote patient monitoring to manage chronic health conditions, convenient outpatient facilities, and hospital care for more complex needs—is focused on supporting every patient’s needs regardless of acuity. We have implemented a suite of programs to support and monitor quality of care, including hospital acquired conditions ("HACs") and serious safety events.
This ecosystem of care—which includes digital engagement and virtual appointments, remote patient monitoring to manage chronic health conditions, convenient outpatient facilities, and hospital care for more complex needs—is focused on supporting every patient’s needs regardless of acuity. We have implemented a suite of programs to support and monitor quality of care, including hospital acquired conditions (“HACs”) and serious safety events.
These efforts have resulted in a Leapfrog hospital safety grade that consistently outranks the national average (including seven “Top Hospitals”). Centralized and Standardized Operating Model Since 2021, we have focused on centralizing corporate services such as human resources, information technology, and finance, while outsourcing certain support functions including revenue cycle management, food services, and environmental services.
These efforts have resulted in a Leapfrog hospital safety grade that consistently outranks the national average (including nine “Top Hospitals”). Centralized and Standardized Operating Model Since 2021, we have focused on centralizing corporate services such as human resources, information technology, and finance, while outsourcing certain support functions including revenue cycle management, food services, and environmental services.
Medicare In addition to the Medicare reimbursement reductions and adjustment discussed below, the Budget Control Act of 2011 (the "BCA") requires automatic spending reductions to reduce the federal deficit, resulting in a uniform percentage reduction across all Medicare programs of 2% per federal fiscal year that extends through the first seven months in which the federal fiscal year 2032 sequestration order is in effect.
Medicare In addition to the Medicare reimbursement reductions and adjustment discussed below, the Budget Control Act of 2011 (the “BCA”) requires automatic spending reductions to reduce the federal deficit, resulting in a uniform percentage reduction across all Medicare programs of 2% per federal fiscal year that extends through the first seven months in which the federal fiscal year 2032 sequestration order is in effect.
Our facilities also are subject to any federal or state privacy-related laws that are more restrictive than the privacy regulations issued under HIPAA. These laws vary and could impose additional penalties. For example, the Federal Trade Commission (the "FTC") uses its consumer protection authority to initiate enforcement actions in response to data breaches.
Our facilities also are subject to any federal or state privacy-related laws that are more restrictive than the privacy regulations issued under HIPAA. These laws vary and could impose additional penalties. For example, the Federal Trade Commission (the “FTC”) uses its consumer protection authority to initiate enforcement actions in response to data breaches.
The JV’s profits, losses and cash distributions are distributed between us and our partners pro rata based upon the respective ownership interest in the JV.
The JV’s profits, losses and cash distributions are 3 distributed between us and our partners pro rata based upon the respective ownership interest in the JV.
The MSA usually has an initial term of five years and automatically renews for successive terms of five years unless terminated as set forth therein.
The MSA usually has an initial term of five years and automatically 4 renews for successive terms of five years unless terminated as set forth therein.
We operate either independently or in partnership with premier academic medical centers, large not-for-profit hospital systems, community physicians, and a community foundation through our well-established and differentiated joint venture ("JV") model. Collectively, we operate as a unified organization with a consumer-centric approach to caring for our patients and our communities.
We operate either independently or in partnership with premier academic medical centers, large not-for-profit hospital systems, community physicians, and a community foundation through our well-established and differentiated joint venture (“JV”) model. Collectively, we operate as a unified organization with a consumer-centric approach to caring for our patients and our communities.
By participating as a member of this organization, we are able to procure supplies and equipment at competitively priced rates for our facilities. Our Properties and Facilities The locations of our hospitals and the number of licensed beds at each hospital as of December 31, 2024 are set forth in the table above under “Item 1.
By participating as a member of this organization, we are able to procure supplies and equipment at competitively priced rates for our facilities. Our Properties and Facilities The locations of our hospitals and the number of licensed beds at each hospital as of December 31, 2025 are set forth in the table above under “Item 1.
The term “affiliates” includes direct and indirect subsidiaries of Ardent and partnerships and joint ventures in which such subsidiaries are equity owners. Ardent is a provider of healthcare services in the United States, operating in eight growing mid-sized urban markets across six states: Texas, Oklahoma, New Mexico, New Jersey, Idaho, and Kansas.
The term "affiliates" includes direct and indirect subsidiaries of Ardent and partnerships and joint ventures in which such subsidiaries are equity owners. Ardent is a provider of healthcare services in the United States, operating in eight growing mid-sized urban markets across six states: Texas, Oklahoma, New Mexico, New Jersey, Idaho, and Kansas.
For example, we currently utilize virtual nurses, wireless biosensors, and artificial intelligence monitoring to supplement the delivery of care at a patient’s bedside. We currently utilize artificial intelligence to monitor and interpret biosensor data for signs of patient deterioration, which enables our caregivers to intervene earlier than would be possible otherwise.
For example, we currently utilize virtual nurses, wireless biosensors, and artificial intelligence (“AI”) monitoring to supplement the delivery of care at a patient’s bedside. We currently utilize AI to monitor and interpret biosensor data for signs of patient deterioration, which enables our caregivers to intervene earlier than would be possible otherwise.
We expect that this approach will grow our market share and drive performance in connection with our value-based care initiatives, which are designed to deliver high-quality care that exceeds Centers for Medicare & Medicaid Services ("CMS") benchmarks to patients in a cost-effective manner for payors.
We expect that this approach will grow our market share and drive performance in connection with our value-based care initiatives, which are designed to deliver high-quality care that exceeds Centers for Medicare & Medicaid Services (“CMS”) benchmarks to patients in a cost-effective manner for payors.
We make available our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), free of charge on our website on the “Investor Relations” webpage under the caption “Financials—SEC Filings” as soon as reasonably practicable after such material is electronically filed with, or furnished to, the Securities and Exchange Commission ("SEC").
We make available our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), free of charge on our website on the “Investor Relations” webpage under the caption “Financials—SEC Filings” as soon as reasonably practicable after such material is electronically filed with, or furnished to, the Securities and Exchange Commission (“SEC”).
Within the framework of the Medicare and Medicaid programs, there are areas subject to administrative rulings, interpretations and discretion which may affect payments made under either or both of such programs. Reimbursement is subject to audit and review by government agencies and contractors, such as the Medicare Administrative Contractors ("MACs").
Within the framework of the Medicare and Medicaid programs, there are areas subject to administrative rulings, interpretations and discretion which may affect payments made under either or both of such programs. Reimbursement is subject to audit and review by government agencies and contractors, such as the Medicare Administrative Contractors (“MACs”).
Other factors affecting our competitive position include: • our reputation for quality and cost of care, which may be impacted by trends toward clinical transparency; • retention of managed care contracting relationships and our ability to enter into new contracts on favorable terms; 12 • and state certificate of need ("CON") laws, which may limit our ability to expand services and facilities, make capital expenditures, and otherwise make changes in operations.
Other factors affecting our competitive position include: • our reputation for quality and cost of care, which may be impacted by trends toward clinical transparency; • retention of managed care contracting relationships and our ability to enter into new contracts on favorable terms; • and state certificate of need (“CON”) laws, which may limit our ability to expand services and facilities, make capital expenditures, and otherwise make changes in operations.
Physician Services Payment under the Medicare program for physician services is based upon the Medicare Physician Fee Schedule, under which CMS has assigned a national relative value unit ("RVU") to most medical procedures and services that reflects the resources required to provide the services relative to all other services.
Physician Services Payment under the Medicare program for physician services is based upon the Medicare Physician Fee Schedule, under which CMS has assigned a national relative value unit (“RVU”) to most medical procedures and services that reflects the resources required to provide the services relative to all other services.
Quality improvement organizations ("QIOs"), for example, are groups of physicians and other healthcare quality experts which work on behalf of CMS to ensure that Medicare pays only for goods and services that are reasonable and necessary and that are provided in the most appropriate setting.
Quality improvement organizations (“QIOs”), for example, are groups of physicians and other healthcare quality experts which work on behalf of CMS to ensure that Medicare pays only for goods and services that are reasonable and necessary and that are provided in the most appropriate setting.
In the event that our JV partner exercises their option to buy out our interest in the JV, the purchase price shall be determined by the product of the appraised fair market value of the JV and the fraction of all issued and outstanding equity units of the JV to be purchased.
In the event that our JV partner exercises their option to buy out our interest in the JV, the purchase price is determined by the product of the appraised fair market value of the JV and the fraction of all issued and outstanding equity units of the JV to be purchased.
Department of Health and Human Services ("HHS") implemented a payment policy that reduced Medicare payments to 340B hospitals for most drugs obtained at 340B-discounted rates, and which resulted in increased payments for non-340B hospitals, including our facilities.
Department of Health and Human Services (“HHS”) implemented a payment policy that reduced Medicare payments to 340B hospitals for most drugs obtained at 340B-discounted rates, and which resulted in increased payments for non-340B hospitals, including our facilities.
Further, the members of the JV Board appointed by us and the members of the JV Board appointed by our JV partner shall each have the unilateral but not exclusive right to terminate the Chief Executive Officer of the JV or the Chief Executive Officer of the hospital operated by the JV for any other reason.
Further, the members of the JV Board appointed by us and the members of the JV Board appointed by our JV partner have the unilateral but not exclusive right to terminate the Chief Executive Officer of the JV or the Chief Executive Officer of the hospital operated by the JV for any other reason.
We also intend to replicate our model across the approximately 350 markets that we believe fit our strategic focus on mid-sized urban communities, allowing us to meet evolving healthcare needs across more geographies, which we believe will drive shareholder value. Our culture of care is core to our consumer-centric delivery model and overall value proposition.
We also intend to replicate our model across the approximately 350 markets that we believe fit our strategic focus on mid-sized urban communities, allowing us to meet evolving healthcare needs across more geographies, which we believe will drive stockholder value. 8 Our culture of care is core to our consumer-centric delivery model and overall value proposition.
Our healthcare facilities serve urban and suburban markets in Amarillo, Texas; Harker Heights, Texas; Tyler, Texas; Albuquerque, New Mexico; Tulsa, Oklahoma; Topeka, Kansas; Pocatello, Idaho; Westwood, New Jersey; and Montclair, New Jersey. The other healthcare facilities include medical office buildings located on the same campus as, or near, our acute care hospitals, physician practices and various ancillary healthcare facilities.
Our healthcare facilities serve urban and suburban markets in Amarillo, Texas; Killeen, Texas; Tyler, Texas; Albuquerque, New Mexico; Tulsa, Oklahoma; Topeka, Kansas; Pocatello, Idaho; Westwood, New Jersey; and Montclair, New Jersey. The other healthcare facilities include medical office buildings located on the same campus as, or near, our acute care hospitals, physician practices and various ancillary healthcare facilities.
We are unable to predict the level of scrutiny these or other regulatory bodies will place on our operations that currently utilize, or will in the future utilize, artificial intelligence and/or predictive algorithms in the clinical space; however, we expect that new, applicable laws and regulations will be passed in the near future at both the federal and state level.
We are unable to predict the level of scrutiny these or other regulatory bodies will place on our operations that currently utilize, or will in the future utilize, AI and/or predictive algorithms in the clinical space; however, we expect that new, applicable laws and regulations will be passed in the near future at both the federal and state level.
Further, submission of a claim for services or items generated in violation of the Anti-Kickback Statute may be subject to additional penalties under the False Claims Act ("FCA") as a false or fraudulent claim.
Further, submission of a claim for services or items generated in violation of the Anti-Kickback Statute may be subject to additional penalties under the False Claims Act (“FCA”) as a false or fraudulent claim.
(5) Source: Strata Decision Technology (2023, 2024); Esri Geoenrichment Service. Note: Esri models projections via US Census estimates. Market population corresponds to approximately 85-90% of the patients we serve in the applicable zip codes defining our markets. Population growth represents estimated growth in the applicable market from 2023 to 2025.
(5) Source: Strata Decision Technology (2025, 2030); Esri Geoenrichment Service. Note: Esri models projections via US Census estimates. Market population corresponds to approximately 85-90% of the patients we serve in the applicable zip codes defining our markets. Population growth represents estimated growth in the applicable market from 2025 to 2030.
For example, the privacy and security regulations promulgated pursuant to the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, and regulations implemented thereunder, (collectively "HIPAA") regulate the use and disclosure of identifiable health information, known as protected health information ("PHI"), and require covered entities, including health plans and most healthcare providers to, among other things, implement administrative, physical and technical safeguards to protect the security of such information.
For example, the privacy and security regulations promulgated pursuant to the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, and regulations implemented thereunder, (collectively “HIPAA”) regulate the use and disclosure of identifiable health information, known as protected health information (“PHI”), and require covered entities, including health plans and most healthcare providers to, among other things, implement administrative, physical and technical safeguards to protect the security of such information.
In addition, the Eliminating Kickbacks in Recovery Act ("EKRA") establishes criminal penalties for paying, receiving, soliciting or offering any remuneration in return for referring a patient to a laboratory, clinical treatment facility or recovery home, or in exchange for an individual using the services of one of these entities.
In addition, the Eliminating Kickbacks in Recovery Act (“EKRA”) establishes criminal penalties for paying, receiving, soliciting or offering any remuneration in return for referring a patient to a laboratory, clinical treatment facility or recovery home, or in exchange 22 for an individual using the services of one of these entities.
If a member does not exercise its right of first refusal, it shall have the right to tag along with the sale to the third party. There are very limited ways that the JV can be dissolved or terminated.
If a member does not exercise its right of first refusal, it has the right to tag along with the sale to the third party. There are very limited ways that the JV can be dissolved or terminated.
Moreover, we believe our shift to a centralized operating structure with standardized systems has primed us for ongoing savings, operational improvements, and future growth in new and existing markets. 8 Highly Integrated, Tech-Enabled Care Delivery Model Our investments in advanced technologies enable our more than 1,800 providers to effectively manage patients’ health needs before, during, and after an episode of care.
Moreover, we believe our shift to a centralized operating structure with standardized systems has primed us for ongoing savings, operational improvements, and future growth in new and existing markets. Highly Integrated, Tech-Enabled Care Delivery Model Our investments in advanced technologies enable our more than 2,000 providers to effectively manage patients’ health needs before, during, and after an episode of care.
We also continually assess advanced technologies to supplement care delivered at the bedside and are currently utilizing a variety of artificial intelligence-powered tools including clinical decision support and smart monitoring devices. The deployment of these and other tools improves patient care and safety while reducing the administrative burden placed on caregivers.
We also continually assess advanced technologies to supplement care delivered at the bedside and are currently utilizing a variety of AI-powered tools including clinical decision support, smart monitoring devices, and clinical documentation tools. The deployment of these and other tools improves patient care and safety while reducing the administrative burden placed on caregivers.
The hospital services sector increasingly will benefit from emerging technologies and the use of data contained within electronic health record ("EHR") systems.
The hospital services sector increasingly will benefit from emerging technologies and the use of data contained within electronic health record (“EHR”) systems.
(3) This metric represents the total number of providers employed by us at our operated hospitals and affiliated providers, measured as of December 31, 2024, including physicians at UKHS St. Francis Campus and UT Health East Texas whom are employed by the hospitals’ respective JV partners but managed by us.
(3) This metric represents the total number of providers employed by us at our operated hospitals and affiliated providers, measured as of December 31, 2025, including physicians at UKHS St. Francis Campus and UT Health East Texas who are employed by the hospitals’ respective JV partners but managed by us.
Census Bureau, those aged 85 and older are projected to grow 168% by 2050, increasing from over six million, or approximately 2% of the population, in 2022, to over 17 million, or approximately 5% of the population.
According to the U.S. Census Bureau, those aged 85 and older are projected to grow 168% by 2050, increasing from over six million, or approximately 2% of the population, in 2022, to over 17 million, or approximately 5% of the population.
For example, effective January 2025, we acquired 18 urgent care centers across New Mexico and Oklahoma, which positioned us to better serve a broad spectrum of acuity throughout the community.
For example, on January 1, 2025, we acquired 18 urgent care centers across New Mexico and Oklahoma, which positioned us to better serve a broad spectrum of acuity throughout the community.
These biosensors also help determine when a patient is stable and ready for discharge, and, when coupled with remote patient monitoring using artificial intelligence, can also help to alert caregivers to the early signs of adverse health events and determine when additional care may be needed following discharge 3 from the hospital.
These biosensors also help determine when a patient is stable and ready for discharge, and, when coupled with remote patient monitoring using AI, can also help to alert caregivers to the early signs of adverse health events and determine when additional care may be needed following discharge from the hospital.
Business—Our Platform.” We operate 30 acute care hospitals including one managed hospital, two rehabilitation hospitals and two surgical hospitals, with a total of 4,281 licensed beds, and provided physician and other ancillary healthcare services through a system of more than 1,360 employed providers.
Business—Our Platform.” We operate 30 acute care hospitals including one managed hospital, two rehabilitation hospitals and two surgical hospitals, with a total of 4,281 licensed beds, and provided physician and other ancillary healthcare services through a system of 1,480 employed providers.
For federal fiscal year 2025, the market basket was reduced by a 0.5 percentage point productivity adjustment.
For federal fiscal year 2025, the market basket was reduced by a 0.5 percentage point productivity adjustment. For federal fiscal year 2026, the market basket was reduced by a 0.7 percentage point productivity adjustment.
The plans may choose to offer supplemental benefits and impose higher premiums and cost-sharing obligations. Enrollment in Medicare Advantage plans is increasing, with industry estimates stating that more than one half of the eligible Medicare population enrolled in such a plan in 2024; projected enrollment estimates remain consistent for 2025.
The plans may choose to offer supplemental benefits and impose higher premiums and cost-sharing obligations. Enrollment in Medicare Advantage plans is increasing, with industry estimates stating that more than one half of the eligible Medicare population enrolled in such a plan in 2025; projected enrollment estimates remain consistent and continue to trend upward for 2026.
The federal government and many states are considering various strategies to reduce Medicaid expenditures. Currently, several states utilize supplemental reimbursement programs intended to offset a portion of the costs to providers associated with providing care to Medicaid and indigent patients.
The federal government and many states are considering various strategies to reduce Medicaid expenditures. Currently, several states in which we operate utilize supplemental reimbursement programs intended to offset a portion of the costs to providers associated with providing care to Medicaid and indigent patients.
The Affordable Care Act and subsequent legislation provide for reductions to the Medicaid DSH hospital program. Under current law, Medicaid DSH payments will be reduced by $8 billion for the period beginning January 1, 2025 and ending September 30, 2025, and in each of federal fiscal years 2026 and 2027.
The Affordable Care Act and subsequent legislation provide for reductions to the Medicaid DSH hospital program. Under current law, Medicaid DSH payments were reduced by $8 billion for the period beginning January 1, 2025 and ending September 30, 2025, and will be reduced by an additional $8 billion per year in each of federal fiscal years 2026 and 2027.
APC payment rates are generally determined by applying a conversion factor, which CMS updates annually using a market basket. For calendar year 2024, CMS increased payment rates under the hospital outpatient PPS by an estimated 3.1%. This increase reflects a market basket increase of 3.3% with a negative 0.2 percentage point productivity point adjustment.
APC payment rates are generally determined by applying a conversion factor, which CMS updates annually using a market basket. For calendar year 2025, CMS increased payment rates under the hospital outpatient PPS by an estimated 2.9%. This increase reflects a market basket increase of 3.4% with a negative 0.5 percentage point productivity point adjustment.
These changes could lower DSH payments for many hospitals and adversely impact our results of operations. CMS also distributes a payment to each DSH hospital that is allocated according to the hospital’s proportion of uncompensated care costs relative to the uncompensated care amount of other DSH hospitals.
These changes could lower DSH payments for many hospitals and adversely impact our results of operations. CMS also distributes a payment to each DSH hospital allocated according to the hospital’s proportion of uncompensated care costs relative to the uncompensated care amounts of other qualifying DSH hospitals.
For example, in July 2022, CMS provided guidance regarding EMTALA obligations specific to patients who are pregnant or are experiencing pregnancy loss and the preemption of state law, which the agency subsequently revised.
For example, in July 2022, CMS provided guidance regarding EMTALA obligations specific to patients who are pregnant or are experiencing pregnancy loss and the preemption of state law.
All of our hospitals and other applicable healthcare facilities are eligible to participate in the Medicare and Medicaid programs. As of December 31, 2024, we leased approximately 87,000 square feet of office space at 340 Seven Springs Way, Suite 100, Brentwood, Tennessee for our corporate headquarters.
All of our hospitals and other applicable healthcare facilities are eligible to participate in the Medicare and Medicaid programs. As of December 31, 2025, we leased approximately 102,290 square feet of office space at 340 Seven Springs Way, Suite 100, Brentwood, Tennessee for our corporate headquarters.
We focus on establishing long-term relationships to engage with patients over their lifetime and seek to deliver superior, cost-effective health outcomes. On average, we care for more than 16,000 people every day across our healthcare ecosystem and during 2024, we served approximately 1.2 million unique patients who had approximately 5.8 million visits with our healthcare providers.
We focus on establishing long-term relationships to engage with patients over their lifetime and seek to deliver superior, cost-effective health outcomes. On average, we care for approximately 17,000 people every day across our healthcare ecosystem and during 2025, we served approximately 1.2 million unique patients who had more than 6.1 million visits with our healthcare providers.
For federal fiscal year 2025, CMS increased inpatient rehabilitation payment rates by 3.0% based on a market basket update of 3.5% reduced by a 0.5 percentage point productivity adjustment. In addition, CMS requires IRFs to report quality measures to avoid receiving a reduction of 2 percentage points to the market basket update.
For federal fiscal year 2026, CMS increased inpatient rehabilitation payment rates by 2.6% based on a market basket update of 3.3% reduced by a 0.7 percentage point productivity 13 adjustment. In addition, CMS requires IRFs to report quality measures to avoid receiving a reduction of 2 percentage points to the market basket update.
Many states have implemented state directed payment ("SDP") arrangements to direct certain Medicaid managed care plan expenditures. These arrangements, which are subject to approval by CMS, allow states to implement delivery system and provider payment initiatives by requiring Medicaid managed care organizations to pay providers according to specific rates or methods.
Many states in which we operate have implemented state directed payment (“SDP”) arrangements to direct certain Medicaid managed care plan expenditures. These arrangements, which are subject to annual approval by CMS, allow states to implement delivery system and provider payment initiatives by requiring Medicaid managed care organizations to pay providers according to specific rates or methods.
For calendar year 2025, CMS increased payment rates under the hospital outpatient PPS by an estimated 2.9%, reflecting a market basket increase of 3.4%, with a negative 0.5 percentage point productivity adjustment. A 2.0 percentage point reduction to the market basket update applies to hospitals that do not submit required patient quality data.
For calendar year 2026, CMS increased payment rates under the hospital outpatient PPS by an estimated 2.6%, reflecting a market basket increase of 3.3%, with a negative 0.7 percentage point productivity adjustment. A 2.0 percentage point reduction to the market basket update applies to hospitals that do not submit required patient quality data.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeKey risks include, but are not limited to, the following: • changes in government healthcare programs, including Medicare and Medicaid, could have an adverse effect on our revenues and business; • reduction in the reimbursement rates paid by commercial payors, our inability to retain and negotiate favorable contracts with private third party payors, or an increasing volume of uninsured or underinsured patients; • security threats, catastrophic events and other disruptions affecting our, our service providers’ or our JV partners’ information technology and related systems, which have adversely affected, and could in the future adversely affect, our relationships with patients and business partners and subject us to legal claims and liabilities, reputational harm and business disruption and adversely affect our financial condition; • the highly competitive nature of the healthcare industry and continued industry trends toward clinical transparency and value-based purchasing may impact our competitive position; 29 • inability to recruit and retain quality physicians and increased labor costs resulting from increased competition for staffing or a continued or increased shortage of experienced nurses, as well as the loss of key personnel, including key members of our management team; • changes to physician utilization practices and treatment methodologies and other factors outside our control that impact demand for medical services may reduce our revenues and ability to grow profitably; • third party payor controls designed to reduce costs and other payor practices, including value-based contracting and care coordination, intended to decrease inpatient services, surgical procedure volumes or reimbursement for services; • inability to successfully complete acquisitions or strategic JVs or inability to realize all of the anticipated benefits, including anticipated synergies, of past acquisitions or failure to maintain existing relationships with JV partners or enter into relationships with additional healthcare system partners; • liabilities because of professional liability and other claims brought against our hospitals, physician practices, outpatient facilities or other business operations or against healthcare providers that provide services at our facilities; • exposure to certain risks and uncertainties by the JVs through which we conduct a significant portion of our operations, including risks as a result of our lack of sole decision-making authority; • failure to obtain drugs and medical supplies at favorable prices or sufficient volumes; • operational, legal and financial risks associated with outsourcing functions to third parties; • our facilities are heavily concentrated in Texas and Oklahoma, which makes us sensitive to regulatory, economic and competitive conditions and changes in those states; • economic factors that have affected, and may continue to impact, our business, financial condition and results of operations; • negative impact of severe weather, climate change, and other factors beyond our control, which could restrict patient access to care or cause one or more of our facilities to close temporarily or permanently; • risks related to the Ventas Master Lease and its restrictions and limitations on our business; • the impact of our significant indebtedness, including our ability to comply with certain debt covenants and other significant operating and financial restrictions imposed on us by the agreements governing our indebtedness, and the effects that variable interest rates and general economic factors could have on our operations, including our potential inability to service our indebtedness; • the impact of a deterioration of public health conditions associated with a future pandemic, epidemic or outbreak of infectious disease; • our failure to comply with complex laws and regulations applicable to the healthcare industry or to adjust our operations in response to changing laws and regulations; • the impact of governmental claims or government investigations, payor audits, and litigation, brought against our hospitals, physician practices, outpatient facilities or other business operations or against healthcare providers that provide services at our facilities; • actual or perceived failures to comply with applicable data protection, privacy and security laws, regulations, standards and other requirements could adversely affect our business, results of operations and financial condition; • inability to or delay in building, acquiring, selling, renovating or expanding our healthcare facilities; • our failure to comply with federal and state laws relating to Medicare and Medicaid enrollment, permit, licensing and accreditation requirements, or the expansion of existing or the enactment of new laws or regulation relating to permit, licensing and accreditation requirements; 30 • effects of changes in public healthcare policy, including any reforms that may be undertaken by a new administration, and legal and regulatory restrictions on our hospitals that have physician owners; • inability to continually enhance our hospitals with the most recent technological advances in diagnostic and surgical equipment; • our status as a controlled company; and • conflicts of interest between our controlling stockholder and other holders of our common stock.
Biggest changeKey risks include, but are not limited to, the following: • changes in government healthcare programs, including Medicare and Medicaid, could have an adverse effect on our revenues and business; • reduction in the reimbursement rates paid by commercial payors, increased reimbursement denials or payment delays by commercial payors, our inability to retain and negotiate favorable contracts with private third party payors, or an increasing volume of uninsured or underinsured patients; • effects of changes in laws, regulations, policies and government programs; • security threats, catastrophic events and other disruptions affecting our, our service providers’ or our JV partners’ information technology and related systems, which have adversely affected, and could in the future adversely affect, our relationships with patients and business partners and subject us to legal claims and liabilities, reputational harm and business disruption and adversely affect our financial condition; • the highly competitive nature of the healthcare industry and continued industry trends toward clinical transparency and value-based purchasing may impact our competitive position; • inability to recruit and retain quality physicians and increased labor costs resulting from increased competition for staffing or a continued or increased shortage of experienced nurses, as well as the loss of key personnel, including key members of our management team; • changes to physician utilization practices and treatment methodologies and other factors outside our control that impact demand for medical services may reduce our revenues and ability to grow profitably; • third party payor controls designed to reduce costs and other payor practices, including value-based contracting and care coordination, intended to decrease inpatient services, surgical procedure volumes or reimbursement for services; • inability to successfully complete acquisitions or strategic JVs or inability to realize all of the anticipated benefits, including anticipated synergies, of past acquisitions or failure to maintain existing relationships with JV partners or enter into relationships with additional healthcare system partners; • liabilities because of professional liability and other claims brought against our hospitals, physician practices, outpatient facilities or other business operations or against healthcare providers that provide services at our facilities; 26 • exposure to certain risks and uncertainties by the JVs through which we conduct a significant portion of our operations, including risks as a result of our lack of sole decision-making authority; • failure to obtain drugs and medical supplies at favorable prices or sufficient volumes; • operational, legal and financial risks associated with outsourcing functions to third parties; • our facilities are heavily concentrated in Texas and Oklahoma, which makes us sensitive to regulatory, economic and competitive conditions and changes in those states; • general economic and business conditions, both nationally and in the regions in which we operate, including the impact of challenging macroeconomic conditions and inflationary pressures, current geopolitical instability, and impacts from the imposition of, or changes in, tariffs, as well as the potential impact of federal government shut downs or other uncertain political, financial, credit and capital conditions, have affected, and may continue to impact, our business, financial condition and results of operations; • negative impact of severe weather, climate change, and other factors beyond our control, which could restrict patient access to care or cause one or more of our facilities to close temporarily or permanently; • risks related to the Ventas Master Lease and its restrictions and limitations on our business; • the impact of our significant indebtedness and the ability to refinance such indebtedness on acceptable terms, including our ability to comply with certain debt covenants and other significant operating and financial restrictions imposed on us by the agreements governing our indebtedness, and the effects that variable interest rates and general economic factors could have on our operations, including our potential inability to service our indebtedness; • the impact of a deterioration of public health conditions associated with a future pandemic, epidemic or outbreak of infectious disease; • our failure to comply with complex laws and regulations applicable to the healthcare industry or to adjust our operations in response to changing laws and regulations; • the impact of governmental claims or government investigations, payor audits, and litigation, brought against our hospitals, physician practices, outpatient facilities or other business operations or against healthcare providers that provide services at our facilities; • actual or perceived failures to comply with applicable data protection, privacy and security laws, regulations, standards and other requirements could adversely affect our business, results of operations and financial condition; • inability to or delay in building, acquiring, selling, renovating or expanding our healthcare facilities; • our failure to comply with federal and state laws relating to Medicare and Medicaid enrollment, permit, licensing and accreditation requirements; • the results of our efforts to use technology, including AI and machine learning, to drive efficiencies, better outcomes and an enhanced patient experience; • our status as a controlled company; and • conflicts of interest between our controlling stockholder and other holders of our common stock.
Our substantial debt could have important consequences to us, including: • increasing our vulnerability to general economic and industry conditions; • requiring a substantial portion of our cash flow used in operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our liquidity and our ability to use our cash flow to fund our operations, capital expenditures and future business opportunities; 44 • exposing us to the risk of increased interest rates, and corresponding increased interest expense, because future borrowings under our existing credit facilities would be at variable rates of interest; • reducing funds available for working capital, capital expenditures, acquisitions and other general corporate purposes, due to the costs and expenses associated with such debt; • limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes; and • limiting our ability to adjust to changing marketplace conditions and placing us at a competitive disadvantage compared to our competitors who may have less debt.
Our substantial debt could have important consequences to us, including: • increasing our vulnerability to general economic and industry conditions; • requiring a substantial portion of our cash flow used in operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our liquidity and our ability to use our cash flow to fund our operations, capital expenditures and future business opportunities; • exposing us to the risk of increased interest rates, and corresponding increased interest expense, because future borrowings under our existing credit facilities would be at variable rates of interest; • reducing funds available for working capital, capital expenditures, acquisitions and other general corporate purposes, due to the costs and expenses associated with such debt; • limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes; and • limiting our ability to adjust to changing marketplace conditions and placing us at a competitive disadvantage compared to our competitors who may have less debt.
Our certificate of incorporation provides that, to the fullest extent permitted by law, any officer or director of ours 57 who is also an officer, director, employee, managing director or other affiliate of EGI-AM or ALH Holdings, LLC (a subsidiary of Ventas) or any of their respective affiliates has the right, and has no duty to abstain from exercising such right, to engage or invest in the same or similar businesses as us, do business with any of our partners or vendors or employ or otherwise engage any of our officers, directors or employees.
Our certificate of incorporation provides that, to the fullest extent permitted by law, any officer or director of ours who is also an officer, director, employee, managing director or other affiliate of EGI-AM or ALH Holdings, LLC (a subsidiary of Ventas) or any of their respective affiliates has the right, and has no duty to abstain from exercising such right, to engage or invest in the same or similar businesses as us, do business with any of our partners or vendors or employ or otherwise engage any of our officers, directors or employees.
We may not be able to timely innovate strategies and technologies to compete or meet changing patient demands. Trends toward clinical transparency and value-based purchasing may impact our competitive position and patient volumes. Healthcare consumers are able to access hospital performance data on quality measures and patient satisfaction, as well as standard charges for services, to compare competing providers.
We may not be able to timely innovate strategies and technologies to compete or meet changing patient demands. Trends toward clinical transparency and value-based purchasing may impact our competitive position and patient volumes. Healthcare consumers are able to access hospital performance data on quality measures and patient satisfaction, as well as standard charges for 31 services, to compare competing providers.
Moreover, although we take steps to monitor and regulate the performance of any parties to which we delegate services, arrangements with third party service providers may make our operations vulnerable if these vendors fail to satisfy their obligations to us as a result of their performance, changes in their own operations, financial condition or other matters outside of our control.
Moreover, although we take steps to monitor and regulate the performance of any parties to which we delegate services, arrangements with third party service providers may make our operations vulnerable if these vendors fail to satisfy their obligations to us as a result of their 37 performance, changes in their own operations, financial condition or other matters outside of our control.
In addition, certain stockholders have certain demand registration rights that could require us to file registration statements for the public resale of such stockholders’ common stock. Such sales by such stockholder could be significant. If securities or industry analysts do not publish research or publish misleading or unfavorable research about our business, our share price and trading volume may decline.
In addition, certain stockholders have certain demand registration rights that could require us to file registration statements for the public resale of such stockholders’ common stock. Such sales by such stockholders could be significant. If securities or industry analysts do not publish research or publish misleading or unfavorable research about our business, our share price and trading volume may decline.
However, certain practices to recruit nurses and medical support personnel that we believe are common in the industry, such as training and education programs that contain a repayment obligation, have been subject to scrutiny by the Consumer Financial Protection Bureau, and our ability to conduct certain types of recruiting initiatives in the future may be limited.
However, certain practices to recruit nurses and medical support personnel that we believe are common in the industry, such as training and education programs that contain a repayment obligation, have been 32 subject to scrutiny by the Consumer Financial Protection Bureau, and our ability to conduct certain types of recruiting initiatives in the future may be limited.
For example, it may be in a VIE’s interest to prioritize investment in hospital-specific infrastructure within its own health system, whereas it may be in the Company’s interest as a whole to allocate funds to certain other health systems with higher growth potential or to invest in other initiatives, such as technological innovation, 40 that might benefit all of our health systems.
For example, it may be in a VIE’s interest to prioritize investment in hospital-specific infrastructure within its own health system, whereas it may be in the Company’s interest as a whole to allocate funds to certain other health systems with higher growth potential or to invest in other initiatives, such as technological innovation, that might benefit all of our health systems.
When an entity is determined to have violated the federal civil FCA, the government may impose substantial civil fines and penalties for each false claim, plus treble damages, and exclude the entity from participation in Medicare, Medicaid and other federal healthcare programs. In addition, a number of states have adopted their own false claims and whistleblower provisions.
When an entity is determined to have violated the federal civil FCA, the government may impose substantial civil fines and penalties for each false claim, plus treble damages, and exclude the entity from participation in 44 Medicare, Medicaid and other federal healthcare programs. In addition, a number of states have adopted their own false claims and whistleblower provisions.
If our competitors are better able to attract patients, make capital expenditures, maintain or upgrade facilities and equipment, recruit or align with physicians, expand services or obtain favorable private third-party payor contracts, we may experience a decline in patient volume. 35 Our performance depends on our ability to recruit and retain quality physicians.
If our competitors are better able to attract patients, make capital expenditures, maintain or upgrade facilities and equipment, recruit or align with physicians, expand services or obtain favorable private third-party payor contracts, we may experience a decline in patient volume. Our performance depends on our ability to recruit and retain quality physicians.
For example, EGI-AM may have an interest in pursuing acquisitions, divestitures, financings or other transactions that, in its judgment, could enhance their equity investments, even though such transactions might involve risks to you as a stockholder. Furthermore, EGI-AM may in the future own businesses that directly or indirectly compete with us.
For example, EGI-AM may have an interest in pursuing acquisitions, divestitures, financings or other transactions that, in its judgment, could enhance their equity investments, even though such transactions might involve risks to you as a stockholder. Furthermore, EGI-AM may in the future own 39 businesses that directly or indirectly compete with us.
The interim and final rules and related guidance implementing the No Surprises Act, including those establishing the IDR process, have been and continue to be subject to legal challenges. For example, in August 32 2023, a federal district court vacated certain provisions of these rules and related guidance documents regarding fees and dispute batching criteria.
The interim and final rules and related guidance implementing the No Surprises Act, including those establishing the IDR process, have been and continue to be subject to legal challenges. For example, in August 2023, a federal district court vacated certain provisions of these rules and related guidance documents regarding fees and dispute batching criteria.
Certain of our facilities have been, are currently, and may in the future be subject to lawsuits, qui tam actions, civil investigative demands, subpoenas, investigations, audits and other inquiries related to our operations. These claims, lawsuits, and proceedings are in various stages of adjudication or investigation and involve a wide variety of claims and potential outcomes.
We and certain of our facilities have been, are currently, and may in the future be subject to lawsuits, qui tam actions, civil investigative demands, subpoenas, investigations, audits and other inquiries related to our operations. These claims, lawsuits, and proceedings are in various stages of adjudication or investigation and involve a wide variety of claims and potential outcomes.
Our cybersecurity risk management program and processes, including our policies, controls or procedures and the other preventive actions we take to reduce the risk of such incidents and protect our information technology and sensitive and confidential data, may not always be fully implemented, complied with, effective or sufficient to defend against all such attacks.
Our cybersecurity risk management program and processes, including our policies, controls or 30 procedures and the other preventive actions we take to reduce the risk of such incidents and protect our information technology and sensitive and confidential data, may not always be fully implemented, complied with, effective or sufficient to defend against all such attacks.
For example, 37 Medicare requires hospitals to report certain quality data to receive full reimbursement updates and does not reimburse for care related to certain preventable adverse events (called “never events”) or care related to HACs. Hospitals in the bottom quartile of HAC rates each year receive a 1% reduction in inpatient PPS Medicare payments.
For example, Medicare requires hospitals to report certain quality data to receive full reimbursement updates and does not reimburse for care related to certain preventable adverse events (called “never events”) or care related to HACs. Hospitals in the bottom quartile of HAC rates each year receive a 1% reduction in inpatient PPS Medicare payments.
Further, we may incur additional unanticipated costs in the integration of our business with the acquired businesses. These unanticipated costs could be substantial. There can be no assurance that the elimination of certain duplicative costs, as well as the realization of other efficiencies related to the integration of the multiple businesses, will offset the 39 incremental transaction-related costs over time.
Further, we may incur additional unanticipated costs in the integration of our business with the acquired businesses. These unanticipated costs could be substantial. There can be no assurance that the elimination of certain duplicative costs, as well as the realization of other efficiencies related to the integration of the multiple businesses, will offset the incremental transaction-related costs over time.
Information blocking is defined as engaging in activities that are likely to interfere with the access, exchange or use of electronic health information, subject to limited exceptions. In June 2023, the OIG published its final rule implementing the statutory penalties for information blocking, 55 which are up to $1 million per violation.
Information blocking is defined as engaging in activities that are likely to interfere with the access, exchange or use of electronic health information, subject to limited exceptions. In June 2023, the OIG published its final rule implementing the statutory penalties for information blocking, which are up to $1 million per violation.
We may also be impacted by SDP arrangements, which allow states to direct certain Medicaid managed care plan 31 expenditures, particularly as funding may be diverted from other payment programs, and we may not satisfy applicable criteria when payments are directed to a specific subset of providers.
We may also be impacted by SDP arrangements, which allow states to direct certain Medicaid managed care plan expenditures, particularly as funding may be diverted from other payment programs, and we may not satisfy applicable criteria when payments are directed to a specific subset of providers.
In addition, even if the operations of our business and the acquired businesses are integrated successfully, the full benefits of such acquisitions may not be realized, including the synergies, cost savings, revenue growth or other benefits that are expected. These benefits may not be achieved within the anticipated time frame, or at all.
In addition, even if the operations of our business and the acquired businesses are integrated successfully, the full benefits of such acquisitions may not be realized, including the synergies, cost savings, revenue growth or other benefits that are expected. These benefits may not be achieved 35 within the anticipated time frame, or at all.
Our ability to access the capital markets on acceptable terms may be severely restricted at a time when we 42 would like, or need, to access those markets, which could have a negative impact on our growth plans, our flexibility to react to changing economic and business conditions and our ability to refinance existing debt.
Our ability to access the capital markets on acceptable terms may be severely restricted at a time when we would like, or need, to access those markets, which could have a negative impact on our growth plans, our flexibility to react to changing economic and business conditions and our ability to refinance existing debt.
The choice of forum provision of our certificate of incorporation does not establish exclusive jurisdiction in the Court of Chancery of the State of Delaware for claims that arise under the Securities Act of 1933, as amended (the “Securities Act”), the Exchange Act, or other federal securities laws if there is exclusive or concurrent jurisdiction in the federal courts.
The choice of forum provision of our certificate of incorporation does not establish exclusive jurisdiction in the Court of Chancery of the State of Delaware for claims that arise under the 52 Securities Act of 1933, as amended (the “Securities Act”), the Exchange Act, or other federal securities laws if there is exclusive or concurrent jurisdiction in the federal courts.
Further, Ventas would have the right in certain circumstances to exercise a purchase option with respect to certain personal property at the leased facilities. Any such occurrence would have a material 43 adverse effect on our business, financial condition, results of operations, cash flows and profitability.
Further, Ventas would have the right in certain circumstances to exercise a purchase option with respect to certain personal property at the leased facilities. Any such occurrence would have a material adverse effect on our business, financial condition, results of operations, cash flows and profitability.
Controls imposed by Medicare, managed Medicare, Medicaid, managed Medicaid and private third party payors designed to reduce admissions, intensity of services, surgical volumes and lengths of stay, in some instances referred to as “utilization review,” have affected and are expected to increasingly affect our facilities.
Controls imposed by Medicare, managed Medicare, Medicaid, managed Medicaid and private third party payors designed to reduce admissions, intensity of services, surgical volumes and lengths of stay, in some instances referred to as “utilization review,” have 33 affected and are expected to increasingly affect our facilities.
The loss of certain key members of our senior management could adversely affect our business until suitable replacements can be found. 38 We may not be able to successfully complete acquisitions or strategic JVs on acceptable terms, which may slow our growth rate.
The loss of certain key members of our senior management could adversely affect our business until suitable replacements can be found. We may not be able to successfully complete acquisitions or strategic JVs on acceptable terms, which may slow our growth rate.
The healthcare industry is required to comply with extensive and complex laws and regulations at the federal, state and local levels relating to, among other issues: • billing and coding for, and documentation of services and properly handling overpayments; • appropriateness and classification of level and setting of care provided, included proper classification of inpatient admissions, observation services and outpatient care; • relationships with physicians and other referral sources and referral recipients; • necessity and adequacy of medical care; • quality of medical equipment and services; • patient, workforce, and public safety; • qualifications of medical and support personnel; • the confidentiality, maintenance, interoperability, exchange, and security of medical records and other health-related and personal information, including data breach, ransomware and identity theft issues; • the development and use of artificial intelligence and other predictive algorithms, including those used in clinical decision support tools; • screening, stabilization and transfer of individuals who have emergency medical conditions; • restrictions on the provision of medical care, including reproductive care; • permitting, facility and personnel licensure, certification and accreditation requirements and enrollment standards and requirements for participation in government healthcare programs; • corporate practice of medicine and fee-splitting; • consumer disclosures and price transparency; 47 • the distribution, maintenance and dispensing of pharmaceuticals and controlled substances; • debt collection, limits or prohibitions on balance billing and billing for out of network services; • preparing and filing of cost reports; • operating policies and procedures; • activities regarding competitors; • addition of facilities and services; and • environmental protection.
The healthcare industry is required to comply with extensive and complex laws and regulations at the federal, state and local levels relating to, among other issues: • billing and coding for, and documentation of services and properly handling overpayments; • appropriateness and classification of level and setting of care provided, included proper classification of inpatient admissions, observation services and outpatient care; • relationships with physicians and other referral sources and referral recipients; • necessity and adequacy of medical care; • quality of medical equipment and services; • patient, workforce, and public safety; • qualifications of medical and support personnel; • the confidentiality, maintenance, interoperability, exchange, and security of medical records and other health-related and personal information, including data breach, ransomware and identity theft issues; • the development and use of AI and other predictive algorithms, including those used in clinical decision support tools; • screening, stabilization and transfer of individuals who have emergency medical conditions; • restrictions on the provision of medical care, including reproductive care; • permitting, facility and personnel licensure, certification and accreditation requirements and enrollment standards and requirements for participation in government healthcare programs; • corporate practice of medicine and fee-splitting; • consumer disclosures and price transparency; • the distribution, maintenance and dispensing of pharmaceuticals and controlled substances; • debt collection, limits or prohibitions on balance billing and billing for out of network services; • preparing and filing of cost reports; • operating policies and procedures; • activities regarding competitors; • addition of facilities and services; and • environmental protection.
Several states in which we operate have also adopted similar fraud and abuse laws to the laws described above. The scope of these laws and the interpretations of them vary from state to state and are enforced by state courts and regulatory authorities, each with 48 broad discretion.
Several states in which we operate have also adopted similar fraud and abuse laws to the laws described above. The scope of these laws and the interpretations of them vary from state to state and are enforced by state courts and regulatory authorities, each with broad discretion.
Enforcement of information blocking penalties began on September 1, 2023. In June 2024, HHS finalized a rule to establish disincentives for healthcare providers that participate in certain Medicare programs and that have been determined by the OIG to have committed information blocking.
Enforcement of information blocking penalties began on September 1, 2023. In June 2024, 49 HHS finalized a rule to establish disincentives for healthcare providers that participate in certain Medicare programs and that have been determined by the OIG to have committed information blocking.
Further, pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the SEC has adopted additional rules and regulations in these areas, such as mandatory “say on pay” voting requirements that apply to us.
Further, pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, 48 the SEC has adopted additional rules and regulations in these areas, such as mandatory “say on pay” voting requirements that apply to us.
If a depository financial institution in which we hold our cash and cash equivalents fails or if a depository institution is subject to other adverse conditions in the financial or credit markets, and impacts access to our invested cash or cash equivalents, our operating liquidity and financial performance could be adversely affected.
If a depository financial institution in which we hold our cash and cash equivalents fails or if a depository institution is 42 subject to other adverse conditions in the financial or credit markets, and impacts access to our invested cash or cash equivalents, our operating liquidity and financial performance could be adversely affected.
If we sell, or any of our existing stockholders sell, a large number of shares of our common stock, or if we issue a large number of shares in connection with future acquisitions, financings, equity incentive plans, or other circumstances, the market price of our 58 common stock could decline significantly.
If we sell, or any of our existing stockholders sell, a large number of shares of our common stock, or if we issue a large number of shares in connection with future acquisitions, financings, equity incentive plans, or other circumstances, the market price of our common stock could decline significantly.
For example, we expect these rules and regulations to make it more difficult and more expensive for 54 us to obtain director and officer liability insurance, and we may be required to incur substantial costs to maintain the same or similar coverage.
For example, we expect these rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to incur substantial costs to maintain the same or similar coverage.
Moreover, if wireless carriers or their trade associations, which issue guidelines for texting programs, determine that we have violated their guidelines, our ability to engage in texting programs may be curtailed or revoked, which could impact our operations and cause us to incur costs related to implementing a workaround solution. 51 The potential effects of federal and state privacy and security requirements are far-reaching and may require us to modify our data processing practices and policies and to incur substantial costs and expenses to comply.
Moreover, if wireless carriers or their trade associations, which issue guidelines for texting programs, determine that we have violated their guidelines, our ability to engage in texting programs may be curtailed or revoked, which could impact our operations and cause us to incur costs related to implementing a workaround solution. 46 The potential effects of federal and state privacy and security requirements are far-reaching and may require us to modify our data processing practices and policies and to incur substantial costs and expenses to comply.
The Federal Reserve Bank of New York has at times conducted operations in the overnight United States Treasury repo market in order to help maintain the federal funds rate within a target range.
The 41 Federal Reserve Bank of New York has at times conducted operations in the overnight United States Treasury repo market in order to help maintain the federal funds rate within a target range.
Implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future, and we cannot predict the impact of future laws, regulations, standards, or the perception of their requirements on our business.
Implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future, and we cannot predict 45 the impact of future laws, regulations, standards, or the perception of their requirements on our business.
The price of our common stock could be subject to fluctuations in response to a number of factors, including those described elsewhere in this report and others such as: • United States political and economic factors unrelated to our performance; • market conditions in the broader stock market; • actual or anticipated fluctuations in our annual and quarterly financial and operating results; • introduction of new products or services by us or our competitors; • speculation in the press or investment community; • issuance of new or changed securities analysts’ reports or recommendations; • our failure or the failure of our competitors to meet analysts’ projections or guidance that we or our competitors may give to the market; • results of operations that vary from expectations of securities analysts and investors; • guidance, if any, that we may provide to the public, any changes in this guidance or our failure to meet this guidance; • strategic actions by us or our competitors; • announcement by us or our competitors of significant contracts or acquisitions; • sales, or anticipated sales, of large blocks of our shares of common stock; • additions or departures of key personnel; • regulatory, legal or political developments; • tax developments; • public response to press releases or other public announcements by us or third parties, including our filings with the SEC; • litigation and governmental investigations; • changing economic conditions; • changes in accounting principles; • default under agreements governing our indebtedness; 56 • exchange rate fluctuations; and • other events or factors, including those from natural disasters, war, acts of terrorism, periods of widespread civil unrest or responses to these events.
The price of our common stock has been and could continue to be subject to fluctuations in response to a number of factors, including those described elsewhere in this report and others such as: • United States political and economic factors unrelated to our performance; • market conditions in the broader stock market; • actual or anticipated fluctuations in our annual and quarterly financial and operating results; • introduction of new products or services by us or our competitors; • speculation in the press or investment community; • issuance of new or changed securities analysts’ reports or recommendations; 50 • our failure or the failure of our competitors to meet analysts’ projections or guidance that we or our competitors may give to the market; • results of operations that vary from expectations of securities analysts and investors; • guidance, if any, that we may provide to the public, any changes in this guidance or our failure to meet this guidance; • strategic actions by us or our competitors; • announcement by us or our competitors of significant contracts or acquisitions; • sales, or anticipated sales, of large blocks of our shares of common stock; • additions or departures of key personnel; • regulatory, legal or political developments; • tax developments; • public response to press releases or other public announcements by us or third parties, including our filings with the SEC; • litigation and governmental investigations; • changing economic conditions; • changes in accounting principles; • default under agreements governing our indebtedness; • exchange rate fluctuations; and • other events or factors, including those from natural disasters, war, acts of terrorism, periods of widespread civil unrest or responses to these events.
Even if we were to conclude, and our independent registered public accounting firm were to concur, that our internal control over financial reporting provided reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles ("GAAP"), because of its inherent limitations, internal control over financial reporting may not prevent or detect fraud or misstatements.
Even if we were to conclude, and our independent registered public accounting firm were to concur, that our internal control over financial reporting provided reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles (“GAAP”), because of its inherent limitations, internal control over financial reporting may not prevent or detect fraud or misstatements.
For further information, see “—We are a “controlled company” within the meaning of the rules of the New York Stock Exchange ("NYSE") and, as a result, we qualify for, and rely on, exemptions from certain corporate governance requirements; you will not have the same protections afforded to stockholders of companies that are subject to all such requirements” and “Item 1A.
For further information, see “—We are a “controlled company” within the meaning of the rules of the New York Stock Exchange (“NYSE”) and, as a result, we qualify for, and rely on, exemptions from certain corporate governance requirements; you will not have the same protections afforded to stockholders of companies that are subject to all such requirements” and “Item 1A.
Risk Factors—Risks Related to Ownership of our Common Stock—Certain of our directors have relationships with our controlling stockholder, EGI-AM, and other affiliated entities of EGI, which may cause conflicts of interest with respect to our business.” As of December 31, 2024, an entity affiliated with Pure Health Holding PJSC (“Pure Health”) beneficially owned approximately 21.2% of our outstanding common stock.
Risk Factors—Risks Related to Ownership of our Common Stock—Certain of our directors have relationships with our controlling stockholder, EGI-AM, and other affiliated entities of EGI, which may cause conflicts of interest with respect to our business.” As of December 31, 2025, an entity affiliated with Pure Health Holding PJSC (“Pure Health”) beneficially owned approximately 21.2% of our outstanding common stock.
Business—Cybersecurity Incident." As cybersecurity threats continue to evolve, we may not be able to anticipate certain attack methods in order to implement effective protective measures, and we may be required to expend significant additional resources to continue to modify and strengthen our security measures, investigate and remediate any vulnerabilities in our information technology systems and infrastructure, or invest in new technology designed to mitigate security risks.
As cybersecurity threats continue to evolve, we may not be able to anticipate certain attack methods in order to implement effective protective measures, and we may be required to expend significant additional resources to continue to modify and strengthen our security measures, investigate and remediate any vulnerabilities in our information technology systems and infrastructure, or invest in new technology designed to mitigate security risks.
Our status as a “controlled company” could make our common stock less attractive to some investors or otherwise harm the trading price of our common stock. Certain of our directors have relationships with our controlling stockholder, EGI-AM, and other affiliated entities of Equity Group Investments ("EGI"), which may cause conflicts of interest with respect to our business.
Our status as a “controlled company” could make our common stock less attractive to some investors or otherwise harm the trading price of our common stock. 51 Certain of our directors have relationships with our controlling stockholder, EGI-AM, and other affiliated entities of Equity Group Investments (“EGI”), which may cause conflicts of interest with respect to our business.
Pure Health may pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us. As of December 31, 2024, ALH Holdings, LLC (a subsidiary of Ventas) beneficially owned approximately 6.5% of our outstanding common stock and may be in a position to influence matters affecting us.
Pure Health may pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us. As of December 31, 2025, ALH Holdings, LLC (a subsidiary of Ventas) beneficially owned approximately 6.5% of our outstanding common stock and may be in a position to influence matters affecting us.
Possible sales also may make it more difficult for us to sell equity or equity-related securities in the future at a time and price we deem necessary or appropriate. As of December 31, 2024, we had approximately 143 million shares of common stock outstanding.
Possible sales also may make it more difficult for us to sell equity or equity-related securities in the future at a time and price we deem necessary or appropriate. As of December 31, 2025, we had approximately 143 million shares of common stock outstanding.
A shortage of nurses and other medical and care support personnel in 2023 and 2024, combined with low unemployment rates for such personnel and intense competition from other healthcare providers, has been a significant operating issue for us and other healthcare providers.
A shortage of nurses and other medical and care support personnel in 2024 and 2025, combined with low unemployment rates for such personnel and intense competition from other healthcare providers, has been a significant operating issue for us and other healthcare providers.
For example, HHS finalized a rule in December 2023 titled Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing (“HTI-1 Final Rule”) which, among other things, modifies the information blocking exceptions, and imposes transparency requirements for artificial intelligence and other predictive algorithms that are part of certified health information technology.
For example, HHS finalized a rule in December 2023 titled Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing (“HTI-1 Final Rule”) which, among other things, modifies the information blocking exceptions, and imposes transparency requirements for AI and other predictive algorithms that are part of certified health information technology.
The risks discussed below also include forward-looking statements, and our actual results may differ substantially from those discussed in these forward-looking statements. See "Forward-Looking Statements" in this Annual Report. Risks Related to Our Business and Industry Changes in government healthcare programs, including Medicare and Medicaid, could have an adverse effect on our revenues and business.
The risks discussed below also include forward-looking statements, and our actual results may differ substantially from those discussed in these forward-looking statements. See “Forward-Looking Statements” in this Annual Report. 27 Risks Related to Our Business and Industry Changes in government healthcare programs, including Medicare and Medicaid, could have an adverse effect on our revenues and business.
In response to the COVID-19 pandemic, the federal government authorized financial relief for eligible healthcare providers through the Public Health and Social Services Emergency Fund ("PHSSEF"), also known as the Provider Relief Fund.
In response to the COVID-19 pandemic, the federal government authorized financial relief for eligible healthcare providers through the Public Health and Social Services Emergency Fund (“PHSSEF”), also known as the Provider Relief Fund.
Under these swap agreements, we are required to make monthly fixed rate payments at annual rates ranging from 1.47% to 1.48%. The counterparties are obligated to make monthly floating rate payments to us based on the one-month Secured Oversight Financing Rate (“SOFR”), each subject to a floor of 0.39%.
Under these swap agreements, we are required to make monthly fixed rate payments at annual rates ranging from 1.47% to 1.48% and the counterparties are required to make monthly floating rate payments to us based on the one-month Term Secured Oversight Financing Rate (“SOFR”), each subject to a floor of 0.39%.
Current and future initiatives related to healthcare technology (including artificial intelligence and other predictive algorithms), data sharing and interoperability may require changes to our operations, impose new and complex obligations on us, affect our relationships with providers, vendors, healthcare information exchanges and other third parties and require investments in infrastructure.
Current and future initiatives related to healthcare technology (including AI and other predictive algorithms), data sharing and interoperability may require changes to our operations, impose new and complex obligations on us, affect our relationships with providers, vendors, healthcare information exchanges and other third parties and require investments in infrastructure.
In recent years, legislative and regulatory changes have resulted in limitations and reductions in payments to healthcare providers for certain services under the Medicare program. For example, as discussed in “Item 1. Business—Reimbursement and Payment—Medicare” under Item 1, Congress established automatic spending reductions under the BCA and ARPA.
In recent years, legislative and regulatory changes have resulted in limitations and reductions in payments to healthcare providers for certain services under the Medicare program. For example, as discussed in “Item 1. Business—Reimbursement and Payment—Medicare,” Congress established automatic spending reductions under the BCA and ARPA.
Such actions, if imposed on the Company or its subsidiaries, could materially and adversely impact our revenue, financial condition and results of operations. Responding to investigations and qui tam lawsuits can be time-and resource-consuming and can divert management’s attention from the business.
Such actions, if imposed on us or our subsidiaries, could materially and adversely impact our revenue, financial condition and results of operations. Responding to investigations and qui tam lawsuits can be time-and resource-consuming and can divert management’s attention from the business.
We operated 30 acute care hospitals at December 31, 2024, and 21 of those hospitals, including one managed hospital, are located in Texas and Oklahoma and include 2,609 licensed beds, or 61% of our total licensed beds. Our Texas and Oklahoma facilities’ combined net revenue represented 60.3% of our consolidated total revenue for the year ended December 31, 2024.
We operated 30 acute care hospitals at December 31, 2025, and 21 of those hospitals, including one managed hospital, are located in Texas and Oklahoma and include 2,609 licensed beds, or 61% of our total licensed beds. Our Texas and Oklahoma facilities’ combined net revenue represented 59.3% of our consolidated total revenue for the year ended December 31, 2025.
Item 1A. Risk Factors Risk Factors Summary An investment in our securities involves numerous risks described in "Risk Factors" below and elsewhere in this Annual Report.
Item 1A. Risk Factors Risk Factors Summary An investment in our securities involves numerous risks described in “Risk Factors” below and elsewhere in this Annual Report.
As of December 31, 2024, approximately 274 employees at the Hackensack Meridian Mountainside Medical Center were represented by two labor unions and the Hackensack Meridian Mountainside Medical Center is party to two collective bargaining agreements. To the extent a significant portion of our employee base unionizes, it is possible our labor costs could increase materially.
As of December 31, 2025, approximately 279 employees at the Hackensack Meridian Mountainside Medical Center were represented by two labor unions and the Hackensack Meridian Mountainside Medical Center is party to two collective bargaining agreements. To the extent a significant portion of our employee base unionizes, it is possible our labor costs could increase materially.
In particular, we may be affected by risks associated with our master services agreement with Ensemble, our vendor for revenue cycle management services, as approximately 89.1% and 90.6% of our total revenue during the years ended December 31, 2024 and 2023, respectively, was collected via such master services agreement.
In particular, we may be affected by risks associated with our master services agreement with Ensemble, our vendor for revenue cycle management services, as approximately 86.6% and 89.1% of our total revenue during the years ended December 31, 2025 and 2024, respectively, was collected via such master services agreement.
Further, it is difficult to predict whether and how Medicaid programs, including waiver programs, might be modified, extended, or eliminated, any of which could have a material adverse effect on our business, financial condition, results of operations or cash flows. See see Note 2, "Summary of Significant Accounting Policies" to our consolidated financial statements.
Further, it is difficult to predict whether and how Medicaid programs, including waiver programs, might be modified, extended, or eliminated, any of which could have a material adverse effect on our business, financial condition, results of operations or cash flows. See Note 2, Summary of Significant Accounting Policies, to our consolidated financial statements included within this Annual Report.
If reimbursement rates paid by commercial payors are reduced, if we are unable to retain and negotiate favorable contracts with private third party payors, if insured individuals move to health plans with greater coverage exclusions or restrictions or narrower networks, or if our volume of uninsured or underinsured patients increases, our revenues may decline.
If reimbursement rates paid by commercial payors are reduced or we experience increased reimbursement denials or payment delays by commercial payors, if we are unable to retain and negotiate favorable contracts with private third party payors, if insured individuals move to health plans with greater coverage exclusions or restrictions or narrower networks, or if our volume of uninsured or underinsured patients increases, our revenues may decline.
The results of operations of our hospitals and other healthcare facilities may be adversely impacted by severe weather conditions, including hurricanes, tornados, floods, earthquakes and widespread winter storms, which may also be exacerbated by climate change, or other factors beyond our control that could cause disruption to patient scheduling or displacement of our patients, employees, physicians and clinical staff, and may force certain of our facilities to close temporarily or permanently.
Our hospitals and other healthcare facilities may be negatively impacted by severe weather, climate change, and other factors beyond our control, which could restrict patient access to care or cause one or more of our facilities to close temporarily or permanently. 38 The results of operations of our hospitals and other healthcare facilities may be adversely impacted by severe weather conditions, including hurricanes, tornados, floods, earthquakes and widespread winter storms, which may also be exacerbated by climate change, or other factors beyond our control that could cause disruption to patient scheduling or displacement of our patients, employees, physicians and clinical staff, and may force certain of our facilities to close temporarily or permanently.
During the years ended December 31, 2023 and 2022, we received $8.5 million and $49.9 million, respectively, in cash distributions from the Provider Relief Fund and other state and local programs, all of which was timely expended. We did not receive any such funds during the year ended December 31, 2024. In June 2024, payments under the PHSSEF ceased.
During the year ended December 31, 2023, we received $8.5 million in cash distributions from the Provider Relief Fund and other state and local programs, all of which was timely expended. We did not receive any such funds during the years ended December 31, 2025 or 2024. In June 2024, payments under the PHSSEF ceased.
Additionally, the increased adoption of artificial intelligence technologies may heighten our cybersecurity risks by making cyberattacks more difficult to detect, contain, and mitigate.
Additionally, the increased adoption of AI technologies may heighten our cybersecurity risks by making cyberattacks more difficult to detect, contain, and mitigate.
Our significant level of indebtedness could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry, and prevent us from meeting our obligations under our debt instruments.
Our significant level of indebtedness, and the ability to refinance such indebtedness on acceptable terms, could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry, and prevent us from meeting our obligations under our debt instruments.
UT Health East Texas accounted for 19.5% and 19.7% of our total revenue for the years ended December 31, 2024 and 2023, respectively, and 11.8% and 3.7% of our pre-tax income for the same periods, respectively. Our next largest JV is in Pocatello, Idaho, where we operate and manage one hospital and twelve sites of care.
UT Health East Texas accounted for 19.4% and 19.5% of our total revenue for the years ended December 31, 2025 and 2024, respectively, and 10.3% and 11.8% of our pre-tax income for the same periods, respectively. Our next largest JV is in Pocatello, Idaho, where we operate and manage one hospital and 14 sites of care.
Likewise, we are unable to predict future reforms to the Medicare and Medicaid programs in the face of heightened regulatory uncertainty. Changes to public policy and related healthcare reform initiatives may have an adverse effect on our business, financial condition, results of operations, cash flow, capital resources and liquidity.
Likewise, we are unable to predict future reforms to the Medicare and Medicaid programs in the face of heightened regulatory uncertainty. Changes to public policy and related healthcare reform initiatives including but not limited to those described here may have an adverse effect on our business, financial condition, results of operations, cash flow, capital resources and liquidity.
A significant portion of our patient volume and our revenues are tied to government healthcare programs. For the years ended December 31, 2024 and 2023, approximately 39.2% and 39.5%, respectively, of our total revenue was related to the Medicare program, and approximately 10.3% and 11.2%, respectively, of our total revenue was related to various state Medicaid programs.
A significant portion of our patient volume and our revenues are tied to government healthcare programs. For the years ended December 31, 2025 and 2024, approximately 38.6% and 39.2%, respectively, of our total revenue was related to the Medicare program, and approximately 9.6% and 10.3%, respectively, of our total revenue was related to various state Medicaid programs.
Growing cybersecurity threats related to the use of ransomware and other malicious software may threaten the access and utilization of critical information technology and data and may also have an adverse impact on our clinical and business operations.
Cybersecurity threats related to the use of ransomware and other malicious software threaten the access and utilization of critical information technology and data and may also have an adverse impact on our clinical and business operations. For example, see “Item 7.
Business—Program Integrity and Fraud and Abuse—Anti-Kickback Statute.” 41 We are subject to a variety of operational, legal and financial risks associated with outsourcing functions to third parties. We have outsourced certain services including, among others, services related to revenue cycle management and environmental and dietary services.
Business—Program Integrity and Fraud and Abuse—Anti-Kickback Statute.” We are subject to a variety of operational, legal and financial risks associated with outsourcing functions to third parties. We have outsourced certain services including, among others, services related to revenue cycle management and environmental and dietary services. Effective management, development and implementation of our outsourcing strategies are important to our business strategy.
As of December 31, 2024, we had $293.1 million (net of the original issue discount and deferred financing costs) of our senior notes outstanding, $765.4 million (net of the original issue discount and deferred financing costs) of borrowings under our senior secured term loan facility and $36.6 million of finance leases and other secured debt (excluding, for the avoidance of doubt, any rent expense payable pursuant to the Ventas Master Lease or the lease arrangement with MPT).
As of December 31, 2025, we had $294.6 million (net of the original issue discount and deferred financing costs) of our senior notes outstanding, $764.2 million (net of the original issue discount and deferred financing costs) of borrowings under our senior secured term loan facility and $40.4 million of finance leases and other secured debt (excluding, for the avoidance of doubt, any rent expense payable pursuant to the Ventas Master Lease or the lease arrangement with MPT).
One key aspect of the Sarbanes-Oxley Act is that we must perform system and process evaluation and testing of our internal control over financial reporting to allow management and our independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, with attestation from our independent registered public accounting firm on the effectiveness of our internal controls, beginning with our annual report for the fiscal year ending December 31, 2025.
One key aspect of the Sarbanes-Oxley Act is that we must perform system and process evaluation and testing of our internal control over financial reporting to allow management and our independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, with attestation from our independent registered public accounting firm on the effectiveness of our internal controls.
For the years ended December 31, 2024 and 2023, $1.7 billion and $1.6 billion, respectively, of our revenue and $242.5 million and $213.7 million, respectively, of our net income was attributable to our JVs and VIEs. As of the date of this Annual Report, we are not aware of any conflicts between the VIE and us.
For the years ended December 31, 2025 and 2024, $1.8 billion and $1.7 billion, respectively, of our revenue and $248.4 36 million and $242.5 million, respectively, of our net income was attributable to our JVs and VIEs. As of the date of this Annual Report, we are not aware of any conflicts between the VIE and us.
However, the information technology and infrastructure we use, and the third party systems with which we interact, have been, and will likely continue to be, vulnerable to attack, damage and interruption from computer viruses and malware (e.g., ransomware), malicious code, attacks by hackers, natural disasters, terrorism, war, telecommunication and electrical failures, fraud, denial or degradation of service attacks, sophisticated nation-state and nation-state supported actors or breaches due to errors or malfeasance by employees or other individuals. 33 We and certain of our service providers have experienced breaches of cybersecurity from time to time, including phishing incidents and other social engineering schemes.
However, the information technology and infrastructure we use, and the third party systems with which we interact, have been, and will likely continue to be, vulnerable to attack, damage and interruption from computer viruses and malware (e.g., ransomware), malicious code, attacks by hackers, natural disasters, terrorism, war, telecommunication and electrical failures, fraud, denial or degradation of service attacks, sophisticated nation-state and nation-state supported actors or breaches due to errors or malfeasance by employees or other individuals.
For additional information regarding the terms of the Ventas Master Lease, see Note 4, "Related Party Transactions" to our consolidated financial statements. Our principal equity holders’ interests may conflict with yours. As of December 31, 2024, EGI-AM Investments, L.L.C. (“EGI-AM”) owned approximately 54.1% of our outstanding common stock. As a result, EGI-AM is our controlling stockholder.
For additional information regarding the terms of the Ventas Master Lease, see Note 4, Related Party Transactions, to our consolidated financial statements included within this Annual Report. Our principal equity holders’ interests may conflict with yours. As of December 31, 2025, EGI-AM Investments, L.L.C. (“EGI-AM”) owned approximately 54.1% of our outstanding common stock.
In either case, our results of operations and financial condition could be adversely affected. Risks Related to Ownership of our Common Stock Our stock price could be volatile, and, as a result, our stockholders may not be able to resell their shares at or above the price paid for them.
Risks Related to Ownership of our Common Stock Our stock price could be volatile, and, as a result, our stockholders may not be able to resell their shares at or above the price paid for them.
If we perform at a level below the outcomes demonstrated by our competitors, are unable to meet or exceed the quality performance standards under any applicable value-based purchasing program, or otherwise fail to effectively provide or coordinate the efficient delivery of quality healthcare services, our reputation in the industry may be adversely affected, we may receive reduced reimbursement amounts and we may owe repayments to payors, causing our revenues to decline.
If we perform at a level below the outcomes demonstrated by our competitors, are unable to meet or exceed the quality performance standards under any applicable value-based purchasing program, or otherwise fail to effectively provide or coordinate the efficient delivery of quality healthcare services, our reputation in the industry may be adversely affected, we may receive reduced reimbursement amounts and we may owe repayments to payors, causing our revenues to decline. 34 We depend on key personnel, and losing one or more of our senior management team or local management personnel could have a material adverse effect on our business.
Economic factors have affected, and may continue to impact, our business, financial condition and results of operations. We believe broad economic factors, such as high unemployment rates in our markets and instability in consumer spending, could impact our volumes and our ability to collect outstanding receivables. The United States economy remains unpredictable.
We believe broad economic factors, such as high unemployment rates in our markets and instability in consumer spending, could impact our volumes and our ability to collect outstanding receivables. The United States economy remains unpredictable.
If interest rates increase, our debt service obligations on our variable rate indebtedness will increase even though the amount borrowed remains the same, and therefore net income and associated cash flows, including cash available for servicing our indebtedness, will correspondingly decrease.
If interest rates increase, our debt service obligations on our variable rate indebtedness will increase even though the amount borrowed remains the same, and therefore net income and associated cash flows, including cash available for servicing our indebtedness, will correspondingly decrease. We have entered into swap agreements to manage our exposure to fluctuations in interest rates.
We incur substantial costs as a result of operating as a public company and our management is required to devote substantial time to new compliance initiatives and corporate governance practices of which we have limited experience.
We incur substantial costs as a result of operating as a public company and our management is required to devote substantial time to new compliance initiatives and corporate governance practices of which we have limited experience. As a public company, we incur significant legal, accounting, administrative and other costs and expenses that we did not previously as a private company.
Employed physicians generally present more direct risks to us than those presented by independent members of our hospitals’ medical staffs, including the incurrence of additional expenses such as salary and benefit costs, medical malpractice expense and rent expense.
Employed physicians generally present more direct risks to us than those presented by independent members of our hospitals’ medical staffs, including the incurrence of additional expenses such as salary and benefit costs, medical malpractice expense and rent expense. These potential liabilities and increased expenses of employing additional physicians could have an adverse effect on our results of operations.
The agreements that govern our existing indebtedness impose significant operating and financial restrictions on us and our subsidiaries, which may prevent us from capitalizing on business opportunities. The agreements that govern our existing indebtedness impose significant operating and financial restrictions on us.
The agreements that govern our existing indebtedness impose significant operating and financial restrictions on us and our subsidiaries, which may prevent us from capitalizing on business opportunities, and we may be unable to refinance such indebtedness on acceptable terms. 40 The agreements that govern our existing indebtedness impose significant operating and financial restrictions on us.
If an investor were to purchase or sell shares that results in an individual or entity with ownership of ten percent (10%) or more of the outstanding equity of any such acute care hospital facility and we did not obtain prior approval (if required) from the State of New Jersey, we may become subject to fines and other monetary penalties, some of which may be significant, and our licenses in New Jersey to operate these facilities may be suspended or revoked, which could have an adverse effect on our business and results of operations. 52 Failure to comply with federal and state laws and regulations relating to Medicare and Medicaid enrollment, permit, licensing and accreditation requirements, or the expansion of existing or the enactment of new laws or regulation relating to permit, licensing and accreditation requirements, could result in fines, penalties and other adverse action, the loss of Medicare and Medicaid enrollment, licenses, permits and accreditations and adversely affect our business and our financial condition.
If an investor were to purchase or sell shares that results in an individual or entity with ownership of ten percent (10%) or more of the outstanding equity of any such acute care hospital facility and we did not obtain prior approval (if required) from the State of New Jersey, we may become subject to fines and other monetary penalties, some of which may be significant, and our licenses in New Jersey to operate these facilities may be suspended or revoked, which could have an adverse effect on our business and results of operations.
Revenues derived from private third party payors accounted for 43.5% and 42.6% of our revenues for 2024 and 2023, respectively. As a result, our ability to maintain or increase patient volumes covered by private third party payors and to maintain and obtain favorable contracts with private third party payors significantly affects our financial condition, results of operations and cash flows.
As a result, our ability to maintain 28 or increase patient volumes covered by private third party payors and to maintain and obtain favorable contracts with private third party payors significantly affects our financial condition, results of operations and cash flows.
If, in spite of our security and compliance efforts, we or any of our JV partners or third party service providers are subject to cyberattacks or security incidents in the future, the costs associated with the investigation, remediation and potential notification of the breach to counter-parties and data subjects could be material, and such incidents could result in harm to patients; business interruptions and delays; the loss, misappropriation, corruption or unauthorized access of data or inability to access data; litigation and potential liability under privacy, security, breach notification and consumer protection laws or other applicable laws, including HIPAA; reputational damage; and federal and state governmental inquiries, civil monetary penalties, settlement agreements, corrective action plans and monitoring requirements, any of which could have an adverse effect on our business, financial condition or results of operations. 34 Furthermore, we rely on information technology systems for a number of critical areas of our operations, including accounting and financial reporting; billing, reimbursement and collections; coding and compliance; clinical systems and medical devices; medical records and document storage; inventory and supply chain management; negotiating, pricing and administering managed care and supply contracts; and monitoring quality of care and collecting quality data necessary for full Medicare payment.
If, in spite of our security and compliance efforts, we or any of our JV partners or third party service providers are subject to cyberattacks or security incidents in the future, the costs associated with the investigation, remediation and potential notification of the breach to counter-parties and data subjects could be material, and such incidents could result in harm to patients; business interruptions and delays; the loss, misappropriation, corruption or unauthorized access of data or inability to access data; litigation and potential liability under privacy, security, breach notification and consumer protection laws or other applicable laws, including HIPAA; reputational damage; and federal and state governmental inquiries, civil monetary penalties, settlement agreements, corrective action plans and monitoring requirements, any of which could have an adverse effect on our business, financial condition or results of operations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn addition, we adopted several technologies that incorporate artificial intelligence capabilities to enhance our protection capabilities. However, we continue to face a heightened risk of cybersecurity threats targeting healthcare providers, including ransomware attacks, which may materially impact our operations.
Biggest changeIn addition, we adopted several technologies that incorporate AI capabilities to enhance our protection capabilities. However, we continue to face a heightened risk of cybersecurity threats targeting healthcare providers, including ransomware attacks, which may materially impact our operations.
Our CISO joined us in January 1998 with 13 years of experience in various technology and information security roles within Ardent. Board Oversight —Our Board of Directors (the "Board"), as a whole and through its committees, oversees risk management, including cybersecurity risks. The Board has delegated certain risk management responsibilities with respect to cybersecurity to our Audit and Compliance Committee.
Our CISO joined us in January 1998 with 13 years of experience in various technology and information security roles within Ardent. Board Oversight —Our Board of Directors (the “Board”), as a whole and through its committees, oversees risk management, including cybersecurity risks. The Board has delegated certain risk management responsibilities with respect to cybersecurity to our Audit and Compliance Committee.
Our Board has identified the oversight of cybersecurity risks to be one of its priorities, and it receives regular reports from management, including the CDTO and the CISO, on various cybersecurity matters, including the security of our information systems, anticipated sources of future material cyber risks and how management is addressing any significant potential vulnerability.
Our Board has identified the oversight of cybersecurity risks to be one of its priorities, and it receives regular 54 reports from management, including the CDTO and the CISO, on various cybersecurity matters, including the security of our information systems, anticipated sources of future material cyber risks and how management is addressing any significant potential vulnerability.
The processes by which he is informed about and monitors the prevention, detection, 60 mitigation and remediation of cybersecurity incidents is described above. He reports information about such risks to the CDTO and other members of senior management, who, in turn, report them to our Board and Audit and Compliance Committee, as appropriate.
The processes by which he is informed about and monitors the prevention, detection, mitigation and remediation of cybersecurity incidents is described above. He reports information about such risks to the CDTO and other members of senior management, who, in turn, report them to our Board and Audit and Compliance Committee, as appropriate.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe information set forth in the “Litigation and Regulatory Matters” section of Note 13 “Commitments and Contingencies” in the notes to the consolidated financial statements contained elsewhere in this Annual Report is incorporated herein by reference. 61
Biggest changeIn addition to the information set forth in this section, refer to the "Litigation and Regulatory Matters" section of Note 13, Commitments and Contingencies, in the notes to the consolidated financial statements contained elsewhere in this Annual Report.
Item 3. Legal Proceedings Because we provide healthcare services in a highly regulated industry, we have been, and expect to continue to be, party to various lawsuits and regulatory investigations from time to time.
Item 3. Legal Proceedings Because we provide healthcare services in a highly regulated industry, we have been, are, and expect to continue to be, party to various lawsuits and regulatory investigations from time to time.
Added
Securities Litigation On January 7, 2026, a purported stockholder filed a putative securities class action against the Company and certain current officers in the lawsuit styled Postiwala v. Ardent Health, Inc., et al., Case No. 3:26-cv-00022, which is pending in the United States District Court for the Middle District of Tennessee, Nashville Division.
Added
The complaint is brought on behalf of a putative class consisting of all persons (other than defendants) who purchased our securities between July 18, 2024 and November 12, 2025, and alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 10b-5 promulgated thereunder based on allegedly false and misleading statements and omissions.
Added
Specifically, the complaint alleges that we incorrectly accounted for and reported on certain accounts receivable and certain insurance reserves during 2024 and 2025 which caused our stock price to be inflated. The complaint seeks unspecified monetary damages, recovery of fees and costs, and other relief that the court may find appropriate.
Added
We intend to vigorously defend the claims made; however, currently no assessment can be made as to the likely outcome. At this time, we are not able to reasonably estimate the amount or range of the ultimate liability, if any, in connection with this case.
Added
Derivative Action 55 On February 26, 2026, a shareholder derivative action styled Thompson v Sotir, et al, Case No 3:26-cv-00219 was filed in the United States District Court for Middle District of Tennessee, Nashville Division, against certain current officers and directors. Ardent Health, Inc. is named as a nominal defendant only.
Added
The factual basis of the complaint is largely the same as in the Postiwala case mentioned above but includes some additional allegations. The complaint alleges breaches of fiduciary duties, gross mismanagement, waste of corporate assets, unjust enrichment, and violation of Section 14(a) of the Securities Exchange Act of 1934.
Added
The complaint seeks unspecified monetary damages, restitution, the adoption of certain governance reforms, recovery of fees and costs, and other relief that the court may find appropriate. We intend to vigorously defend the claims made; however, currently no assessment can be made as to the likely outcome.
Added
At this time, we are not able to reasonably estimate the amount or range of the ultimate liability, if any, in connection with this case.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePurchases of Equity Securities by Issuer During the three months ended December 31, 2024, we made the following purchases of our equity securities that are registered pursuant to Section 12(b) of the Securities Exchange Act of 1934: Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs (2) October 1, 2024 - October 31, 2024 — $ — — — November 1, 2024 - November 30, 2024 4,389 17.00 — — December 1, 2024 - December 31, 2024 1,415 17.08 — — Total 5,804 $ 17.02 — — (1) Represents 5,804 shares withheld by us to satisfy the payment of tax obligations related to the vesting of restricted stock unit awards.
Biggest changeDuring the three months ended December 31, 2025, we made the following purchases of our equity securities that are registered pursuant to Section 12(b) of the Securities Exchange Act of 1934 (dollars in millions, except per share amounts): Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Dollar Value That May Yet Be Purchased Under Publicly Announced Plans or Programs October 1, 2025 - October 31, 2025 7,755 $ 14.06 — $ — November 1, 2025 - November 30, 2025 225,311 $ 8.97 225,311 $ 48.0 December 1, 2025 - December 31, 2025 129,845 $ 9.01 125,701 $ 46.8 Total 362,911 $ 9.09 351,012 (1) Includes 11,899 shares withheld by us to satisfy the payment of tax obligations related to the vesting of restricted stock unit awards.
Dividend Policy We did not pay any cash dividends during the year ended December 31, 2024 and do not intend to declare or pay any cash dividends on our common stock for the foreseeable future. We currently intend to continue to retain earnings to fund the operation and growth of our business and to repay indebtedness.
Dividend Policy We did not pay any cash dividends during the year ended December 31, 2025 and do not intend to declare or pay any cash dividends on our common stock for the foreseeable future. We currently intend to continue to retain earnings to fund the operation and growth of our business and to repay indebtedness.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the NYSE under the symbol “ARDT.” As of February 20, 2025, there were approximately 210 holders of record of our common stock.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the NYSE under the symbol “ARDT.” As of March 10, 2026, there were approximately 158 holders of record of our common stock.
The comparisons in the graph below are based on historical data and are not indicative of, nor intended to forecast, future performance of our common stock. 63 COMPARISON OF FIVE-MONTH CUMULATIVE TOTAL RETURN Among Ardent Health Partners, Inc., the S&P 500 Index and the S&P Health Care Index July 18, 2024 July 31, 2024 August 31, 2024 September 30, 2024 October 31, 2024 November 30, 2024 December 31, 2024 Ardent Health Partners, Inc. $ 100.00 $ 103.29 $ 114.62 $ 106.24 $ 100.58 $ 92.37 $ 98.73 S&P 500 $ 100.00 $ 100.34 $ 102.77 $ 104.97 $ 104.01 $ 110.12 $ 107.49 S&P Health Care $ 100.00 $ 101.21 $ 106.38 $ 104.59 $ 99.75 $ 100.03 $ 93.82 The performance graph and related information shall not be deemed “soliciting material”, is not deemed “filed” with the SEC, and is not to be incorporated by reference into any future filing under the Securities Act or Exchange Act.
The comparisons in the graph below are based on historical data and are not indicative of, nor intended to forecast, future performance of our common stock. 57 COMPARISON OF 17 MONTH CUMULATIVE TOTAL RETURN Among Ardent Health, Inc., the S&P 500 Index and the S&P Health Care Index July 18, 2024 September 30, 2024 December 31, 2024 March 31, 2025 June 30, 2025 September 30, 2025 December 31, 2025 Ardent Health, Inc. $ 100.00 $ 114.45 $ 106.35 $ 85.62 $ 85.06 $ 82.50 $ 54.98 S&P 500 $ 100.00 $ 103.93 $ 106.08 $ 101.21 $ 111.91 $ 120.63 $ 123.46 S&P Health Care $ 100.00 $ 104.80 $ 93.61 $ 99.30 $ 91.73 $ 94.73 $ 105.35 The performance graph and related information shall not be deemed “soliciting material,” is not deemed “filed” with the SEC, and is not to be incorporated by reference into any future filing under the Securities Act or Exchange Act.
Removed
(2) We had no publicly announced plans or open market repurchase programs for shares of our common stock during the three months ended December 31, 2024.
Added
Purchases of Equity Securities by Issuer In November 2025, our Board of Directors authorized a stock repurchase program pursuant to which we may repurchase an aggregate of up to $50.0 million of our common stock through open market purchases, privately negotiated transactions, block trades or other transactions in accordance with applicable securities laws, subject to market conditions and other factors.
Removed
Use of Proceeds from Initial Public Offering of Common Stock On July 17, 2024, our registration statement on Form S-1 (File No. 333-280425) related to the initial public offering (the "IPO") was declared effective by the SEC.
Added
The program has no expiration date. At December 31, 2025, there was approximately $46.8 million of stock repurchase authorization remaining under the stock repurchase program. All repurchases under the program during the three months ended December 31, 2025, as shown below, were made in the open market.
Removed
Pursuant to such registration statement, we issued and sold 12,000,000 shares of common stock at a public offering price of $16.00 per share on July 19, 2024. We received net proceeds of approximately $181.4 million, after deducting underwriting discounts and commissions of approximately $10.6 million.
Removed
On July 30, 2024, in conjunction with the underwriters exercising their option to purchase additional shares, we issued an additional 1,800,000 shares of common stock at the initial public offering price of $16.00 per share for additional net proceeds of approximately $27.2 million, after deducting underwriting discounts and commissions of approximately $1.6 million.
Removed
None of the expenses associated with the IPO were paid to directors, officers, or persons owning 10% or more of any class of equity securities, or to our affiliates.
Removed
As of December 31, 2024, all of the net proceeds from our IPO have been used to acquire complementary healthcare facilities, services and technologies, for general corporate purposes and for working capital. There was no material change in the use of such proceeds from that described in the prospectus for our IPO. Item 6. Reserved 64

Item 7. Management's Discussion & Analysis

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

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Biggest changeFactors, risks, and uncertainties that could cause actual outcomes and results to be materially different from those contemplated include, among others: (1) changes in government healthcare programs, including Medicare and Medicaid could have an adverse effect on our revenues and business; (2) reduction in the reimbursement rates paid by commercial payors, our inability to retain and negotiate favorable contracts with private third party payors, or an increasing volume of uninsured or underinsured patients; (3) security threats, catastrophic events and other disruptions affecting our, our service providers’ or our JV partners’ information technology and related systems, which have adversely affected, and could in the future adversely affect, our relationships with patients and business partners and subject us to legal claims and liabilities, reputational harm and business disruption and adversely affect our financial condition; (4) the highly competitive nature of the healthcare industry and continued industry trends towards clinical transparency and value-based purchasing may impact our competitive position; (5) inability to recruit and retain quality physicians, as well as increasing cost to contract with hospital-based physicians; (6) changes to physician utilization practices and treatment methodologies and other factors outside our control that impact demand for medical services and may reduce our revenues and ability to grow profitability; (7) continued industry trends toward value-based purchasing, third party payor consolidation and care coordination among healthcare providers; (8) inability to successfully complete acquisitions or strategic JVs or inability to realize all of the anticipated benefits; (9) liabilities because of professional liability and other claims brought against our hospitals, physician practices, outpatient facilities or other business operations; (10) exposure to certain risks and uncertainties by the JVs through which we conduct a significant portion of our operations, including anticipated synergies, of past acquisitions and the risk that transactions may not receive necessary government clearances; (11) failure to obtain drugs and medical supplies at favorable prices or sufficient volumes; (12) operational, legal and financial risks associated with outsourcing functions to third parties; (13) our facilities are heavily concentrated in Texas and Oklahoma, which makes us sensitive to regulatory, economic and competitive conditions and changes in those states; (14) negative impact of severe weather, climate change, and other factors beyond our control, which could restrict patient access to care or cause one or more facilities to close temporarily or permanently; (15) risks related to the Ventas Master Lease and its restrictions and limitations on our business; (16) the impact of our significant indebtedness; (17) the impact of a deterioration of public health conditions associated with a future pandemic, epidemic or outbreak of infectious disease; (18) our failure to comply with complex laws and regulations applicable to the healthcare industry or to adjust our operations in response to changing laws and regulations; (19) the impact of governmental claims or governmental investigations, payor audits and litigation brought against our hospitals, physician practices, outpatient facilities or other business operations; (20) actual or perceived failures to comply with applicable data protection, privacy and security laws, regulations, standards and other requirements; (21) inability to or delay in building, acquiring, selling, renovating or expanding our healthcare facilities; (22) failure to comply with federal and state laws relating to Medicare and Medicaid enrollment, permit, licensing and accreditation requirements; (23) effects of changes in public healthcare policy, including any reforms that may be undertaken by a new administration, and legal and regulatory restrictions on our hospitals that have physician owners; (24) inability to continually enhance our hospitals with the most recent technological advances in diagnostic and surgical equipment; (25) our status as a controlled 65 company; (26) conflicts of interest between our controlling stockholder and other holders of our common stock; and (27) other risk factors described in our filings with the SEC.
Biggest changeFactors, risks, and uncertainties that could cause actual outcomes and results to be materially different from those contemplated include, among others: (1) general economic and business conditions, both nationally and in the regions in which we operate, including the impact of challenging macroeconomic conditions and inflationary pressures, current geopolitical instability, and impacts from the imposition of, or changes in, tariffs, as well as the potential impact on us of the federal government shutdown or other uncertain political, financial, credit and capital conditions; (2) possible reductions or other changes in Medicare, Medicaid and other state programs, including Medicaid supplemental payment programs, Medicaid waiver programs or state directed payments, that could have an adverse effect on our revenues and business; (3) reduction in the reimbursement rates paid by commercial payors, increased reimbursement denials or payment delays by commercial payors, our inability to retain and negotiate favorable contracts with private third party payors, or an increasing volume of uninsured or underinsured patients; (4) effects of changes in healthcare policy or legislation, including the One Big Beautiful Bill Act (the "OBBBA") and any other reforms that have or may be undertaken by the current presidential administration, and legal and regulatory restrictions on our hospitals that have physician owners; (5) the ability to achieve operating and financial targets, develop and execute mitigation plans to offset to the extent possible impacts from the OBBBA, the expiration of temporary enhanced subsidies for individuals eligible to purchase insurance coverage through health insurance marketplaces and imposition of tariffs, attain expected levels of patient volumes and revenues, and control the costs of providing services; (6) security threats, catastrophic events and other disruptions affecting our, our service providers’ or our joint venture ("JV") partners’ information technology and related systems, which have adversely affected, and could in the future adversely affect, our relationships with patients and business partners and subject us to legal claims and liabilities, reputational harm and business disruption and adversely affect our financial condition; (7) the highly competitive nature of the healthcare industry and continued industry trends towards clinical transparency and value-based purchasing may impact our competitive position; (8) inability to recruit and retain quality physicians, as well as increasing cost to contract with hospital-based physicians; (9) changes to physician utilization practices and treatment methodologies and other factors outside our control that impact demand for medical services and may reduce our revenues and ability to grow profitability; (10) continued industry trends toward value-based purchasing, third party payor consolidation and care coordination among healthcare providers; (11) inability to successfully complete acquisitions or strategic JVs or inability to realize all of the anticipated benefits; (12) liabilities because of professional liability and other claims brought against our hospitals, physician practices, outpatient facilities or other business operations; (13) exposure to certain risks and uncertainties by the JVs through which we conduct a significant portion of our operations, including anticipated synergies of past acquisitions and the risk that transactions may not receive necessary government clearances; (14) failure to obtain drugs and medical supplies at favorable prices or sufficient volumes; (15) operational, legal and financial risks associated with outsourcing functions to third parties; (16) our facilities are heavily concentrated in Texas and Oklahoma, which makes us sensitive to regulatory, economic and competitive conditions and changes in those states; (17) negative impact of severe weather, climate change, and other factors beyond our control, which could restrict patient access to care or cause one or more facilities to close temporarily or permanently; (18) risks related to the Master Lease with Ventas (“Ventas Master Lease”) and its restrictions and limitations on our business; (19) the impact of our significant indebtedness and the ability to refinance such indebtedness on acceptable terms; (20) our failure to comply with complex laws and regulations applicable to the healthcare industry or to adjust our operations in response to changing laws and regulations; (21) the impact of governmental claims or governmental investigations, payor audits and litigation brought against our hospitals, physician practices, outpatient facilities or other business operations; (22) actual or perceived failures to comply with applicable data protection, privacy and security laws, regulations, standards and other requirements; (23) the impact of a deterioration of public health conditions associated with a future pandemic, epidemic or outbreak of infectious disease; (24) inability to or delay in building, acquiring, selling, renovating or expanding our healthcare facilities; (25) failure to comply with federal and state laws relating to Medicare and Medicaid enrollment, permit, licensing and accreditation requirements; (26) the results of our efforts to use technology, including artificial intelligence (“AI”) and machine learning, to drive efficiencies, better outcomes and an enhanced 59 patient experience; (27) our status as a controlled company; (28) conflicts of interest between our controlling stockholder and other holders of our common stock; and (29) other risk factors described in our filings with the SEC.
In connection with these transactions, we incurred a loss on the debt extinguishment of $1.8 million related to the write-off of existing deferred financing costs and original issue discounts and transaction costs of $1.2 million related to the modification of debt during the year ended December 31, 2024.
In connection with these 2024 transactions, we incurred a loss on debt extinguishment of $1.8 million related to the write-off of existing deferred financing costs and original issue discounts and transaction costs of $1.2 million related to the modification of debt during the year ended December 31, 2024.
Investing Activities Cash flows used in investing activities for the year ended December 31, 2024 totaled $220.5 million compared to $138.0 million for the prior year. Capital expenditures for non-acquisitions were $187.5 million and $137.4 million for the years ended December 31, 2024 and 2023, respectively.
Cash flows used in investing activities for the year ended December 31, 2024 totaled $220.5 million compared to $138.0 million for the prior year. Capital expenditures for non-acquisitions were $187.5 million and $137.4 million for the years ended December 31, 2024 and 2023, respectively.
Effective July 19, 2024, pursuant to the terms of the Term Loan B Credit Agreement and as a result of the IPO, the applicable margin was automatically reduced by 25 basis points to 3.25% over Term SOFR and 2.25% over base rate. On September 18, 2024, we executed an amendment to reprice our Term Loan B Credit Agreement.
Effective July 19, 2024, pursuant to the terms of the Term Loan B Credit Agreement and as a result of the IPO, the applicable margin was automatically reduced by 25 basis points to 3.25% over Term SOFR and 2.25% over the base rate. On September 18, 2024, we executed an amendment to reprice our Term Loan B Credit Agreement.
The obligations under the Term Loan B Facility and the ABL Facilities in excess of the maximum aggregate dollar cap amount permitted to be guaranteed by the Tenants are not secured by the assets of the Tenants.
The obligations under the Term Loan B Facility and the ABL Facilities in excess of the maximum aggregate dollar cap amount permitted to be guaranteed by the Tenants are not secured by the assets of the Tenants.
Final determination of amounts earned under the Medicare, Medicaid and other third party payor programs often occurs in subsequent years because of audits by the programs, rights of appeal, and the application of technical provisions.
Final determination of amounts earned under Medicare, Medicaid and other third party payor programs often occurs in subsequent years because of audits by the programs, rights of appeal, and the application of technical provisions.
Subject to certain exceptions (including with regard to the ABL Priority Collateral), thresholds and reinvestment rights, the Term Loan B Facility is subject to mandatory prepayments with respect to: • net cash proceeds of issuances of debt by AHP Health Partners or any of its restricted subsidiaries that are not permitted by the Term Loan B Facility; • subject to certain thresholds, reinvestment permissions and carve-outs, 100% (with step-downs to 50% and 0%, based upon achievement of specified senior secured net leverage ratio levels) of net cash proceeds of certain asset sales; • subject to certain thresholds, reinvestment permissions and carve-outs, 100% (with step-downs to 50% and 0%, based upon achievement of specified senior secured net leverage ratio levels) of net cash proceeds of certain insurance and condemnation events; • 50% (with step-downs to 25% and 0%, based upon achievement of specified senior secured net leverage ratio levels) of annual excess cash flow, net of certain voluntary prepayments of secured indebtedness, of AHP Health Partners and its subsidiaries commencing with the fiscal year ending December 31, 2022; and • net cash proceeds received in connection with any exercise of the purchase option of the loans by Ventas under the Relative Rights Agreement. 5.75% Senior Notes due 2029 AHP Health Partners (the “Issuer”) issued the 5.75% Senior Notes in an exempt offering pursuant to Rule 144A and Regulation S under the Securities Act that was completed on July 8, 2021.
Subject to certain exceptions (including with regard to the ABL Priority Collateral), thresholds and reinvestment rights, the Term Loan B Facility is subject to mandatory prepayments with respect to: • net cash proceeds of issuances of debt by AHP Health Partners or any of its restricted subsidiaries that are not permitted by the Term Loan B Facility; • subject to certain thresholds, reinvestment permissions and carve-outs, 100% (with step-downs to 50% and 0%, based upon achievement of specified senior secured net leverage ratio levels) of net cash proceeds of certain asset sales; • subject to certain thresholds, reinvestment permissions and carve-outs, 100% (with step-downs to 50% and 0%, based upon achievement of specified senior secured net leverage ratio levels) of net cash proceeds of certain insurance and condemnation events; • 50% (with step-downs to 25% and 0%, based upon achievement of specified senior secured net leverage ratio levels) of annual excess cash flow, net of certain voluntary prepayments of secured indebtedness, of AHP Health Partners and its subsidiaries commencing with the fiscal year ending December 31, 2022; and 74 • net cash proceeds received in connection with any exercise of the purchase option of the loans by Ventas under the Relative Rights Agreement. 5.75% Senior Notes due 2029 AHP Health Partners (the “Issuer”) issued the 5.75% Senior Notes in an exempt offering pursuant to Rule 144A and Regulation S under the Securities Act that was completed on July 8, 2021.
Excluding the rent payable to such REITs allows investors to compare our enterprise value to those of other healthcare companies without regard to differences in capital structures, leasing arrangements and geographic markets, which can vary significantly among companies. Our management also uses Adjusted EBITDAR as one measure in determining the value of prospective acquisitions or divestitures.
Excluding the rent payable to such REITs allows investors to compare our enterprise value to those of other healthcare companies without regard to differences in capital structures, leasing arrangements and geographic markets, which can vary significantly among companies. Our management also uses Adjusted EBITDAR as one measure in determining the value of prospective acquisitions or 75 divestitures.
For example, the No Surprises Act prohibits providers from charging patients an amount beyond the in-network cost sharing amount for services rendered by out-of-network providers, subject to limited exceptions. For services for which balance billing is prohibited, the No Surprises Act includes provisions that may limit the amounts received by out-of-network providers from health plans.
For example, the No Surprises Act prohibits providers from charging patients an amount beyond the in-network cost sharing amount for services rendered by out-of-network providers, subject to limited exceptions. For services for which balance billing is prohibited, the No Surprises Act includes provisions that may limit the amounts received by out-of-network providers from health 63 plans.
In addition, the Relative Rights Agreement entered into by and among Ventas, the 5.75% Senior Notes trustee and the administrative agents under our Senior Secured Credit Facilities (as defined below) in connection with the series of debt transactions completed during the year ended 2021 to refinance our then-existing debt, among other things, (i) sets forth the relative rights of Ventas and the administrative agents with respect to the properties and collateral related to the Ventas Master Lease and securing our Senior Secured Credit Facilities, (ii) caps the amount of indebtedness incurred or guaranteed by our subsidiaries that are tenants under the Ventas Master Lease ("Tenants") (together with such Tenants’ guarantees of the notes and the Senior Secured 79 Credit Facilities and all other indebtedness incurred or guaranteed by such Tenants) at $375.0 million and (iii) imposes certain incurrence tests on the incurrence of additional indebtedness by such Tenants and by us.
In addition, the Relative Rights Agreement entered into by and among Ventas, the 5.75% Senior Notes trustee and the administrative agents under our Senior Secured Credit Facilities (as defined below) in connection with the series of debt transactions completed during the year ended 2021 to refinance our then-existing debt, among other things, (i) sets forth the relative rights of Ventas and the administrative agents with respect to the properties and collateral related to the Ventas Master Lease and securing our Senior Secured Credit Facilities, (ii) caps the amount of indebtedness incurred or guaranteed by our subsidiaries that are tenants under the Ventas Master Lease (“Tenants”) (together with such Tenants’ guarantees of the notes and the Senior Secured Credit Facilities and all other indebtedness incurred or guaranteed by such Tenants) at $375.0 million and (iii) imposes certain incurrence tests on the incurrence of additional indebtedness by such Tenants and by us.
Since we only manage the clinical operations of UT Health North Campus Tyler, the financial results of such entity are not consolidated under Ardent Health Partners, Inc. On April 30, 2024, we closed UT Health East Texas Specialty Hospital, a long-term acute care hospital (the “LTAC Hospital”) in Tyler, Texas.
Since we only manage the clinical operations of UT Health North Campus Tyler, the financial results of such entity are not consolidated under Ardent Health, Inc.. On April 30, 2024, we closed UT Health East Texas Specialty Hospital, a long-term acute care hospital (the “LTAC Hospital”) in Tyler, Texas.
As a result of the Corporate Conversion, the outstanding limited liability company membership units and vested profits interest units were converted into 120,937,099 shares of common stock and outstanding unvested profits interest units were converted into 2,848,027 shares of restricted common stock. Immediately following 66 the Corporate Conversion, ALH Holdings, LLC, a subsidiary of Ventas, Inc.
As a result of the Corporate Conversion, the outstanding limited liability company membership units and vested profits interest units were converted into 120,937,099 shares of common stock and outstanding unvested profits interest units were converted into 2,848,027 shares of restricted common stock. Immediately following the Corporate Conversion, ALH Holdings, LLC, a subsidiary of Ventas, Inc.
The increase in cash flows during the year ended December 31, 2024 compared to the prior year was offset by changes in net working capital, which primarily consisted of increases in other receivables related to New Mexico’s supplemental payment program that was approved by CMS in the fourth quarter of 2024.
The increase in cash flows during the year ended December 31, 2024 compared to the prior year was offset by changes in net working capital, which primarily consisted of increases in other receivables related to New Mexico’s Medicaid supplemental payment program that was approved by CMS in the fourth quarter of 2024.
Income Taxes We account for income taxes associated with the activities of Ardent Health Partners, Inc., which is subject to federal and state income tax as a corporation. We account for income taxes using the asset and liability method.
Income Taxes We account for income taxes associated with the activities of Ardent Health, Inc., which is subject to federal and state income tax as a corporation. We account for income taxes using the asset and liability method.
Initial Public Offering and Corporate Conversion On July 19, 2024, we completed an IPO of 12,000,000 shares of our common stock, at a public offering price of $16.00 per share for aggregate gross proceeds of $192.0 million and net proceeds of approximately $181.4 million after deducting underwriting discounts and commissions of approximately $10.6 million.
Initial Public Offering and Corporate Conversion On July 19, 2024, we completed an IPO of 12,000,000 shares of our common stock, at a public offering price of $16.00 per share (the “IPO”) for aggregate gross proceeds of $192.0 million and net proceeds of approximately $181.4 million after deducting underwriting discounts and commissions of approximately $10.6 million.
However, ultimate reimbursements may result in payments that differ from our estimates. Additionally, updated regulations and contract renegotiations occur frequently, requiring that we regularly review and assess our estimates. Changes in estimates related to contractual adjustments affect the amounts we report as patient service revenue and are recorded in the period the changes occur.
However, ultimate reimbursements may result in payments that differ from our estimates. Additionally, updates to regulations and contract renegotiations occur frequently, requiring that we regularly review and assess our estimates. Changes in estimates related to contractual adjustments affect the amounts we report as patient service revenue and are recorded in the period the changes occur.
ABL Credit Agreement Amendment and Term Loan B Facility Prepayment On June 26, 2024, we executed an amendment to the credit agreement for our $225.0 million senior secured asset based revolving credit facility (the "ABL Credit Agreement") to increase the revolving commitment by $100.0 million to $325.0 million and extend the maturity date to June 26, 2029.
ABL Credit Agreement Amendment and Term Loan B Facility Prepayment On June 26, 2024, we executed an amendment to the credit agreement for our $225.0 million senior secured asset based revolving credit facility (the “ABL Credit Agreement”) to increase the revolving commitment by $100.0 million to $325.0 million and extend the maturity date to June 26, 2029.
Adjusted EBITDAR excludes: (1) certain material noncash items and unusual or non-recurring items that we do not expect to continue in the future; (2) certain other adjustments that do not impact our enterprise value; and (3) rent expense payable to our REITs.
Adjusted EBITDAR excludes: (1) certain material non-cash items and unusual or non-recurring items that we do not expect to continue in the future; (2) certain other adjustments that do not impact our enterprise value; and (3) rent expense payable to our REITs.
Our lease-adjusted net leverage is calculated as net debt as of December 31, 2024, plus 8.0x trailing twelve month REIT rent expense as of the end of the fourth quarter of 2024, divided by the trailing twelve month Adjusted EBITDAR as of December 31, 2024.
Our lease-adjusted net leverage is calculated as net debt as of December 31, 2025, plus 8.0x trailing twelve month REIT rent expense as of the end of the fourth quarter of 2025, divided by the trailing twelve month Adjusted EBITDAR as of December 31, 2025.
On July 17, 2024, in connection with the IPO and immediately prior to the effectiveness of our registration statement on Form S-1, we converted from a Delaware limited liability company into a Delaware corporation by means of a statutory conversion (the "Corporate Conversion") and changed our name to Ardent Health Partners, Inc.
On July 17, 2024, in connection with the IPO and immediately prior to the effectiveness of our registration statement on Form S-1, we converted from a Delaware limited liability company into a Delaware corporation by means of a statutory conversion (the “Corporate Conversion”) and changed our name to Ardent Health Partners, Inc.
As of December 31, 2024, following the consummation of the IPO and the underwriters’ exercise of their option to purchase additional shares, Ventas beneficially owned approximately 6.5% of our outstanding common stock.
As of December 31, 2025, following the consummation of the IPO and the underwriters’ exercise of their option to purchase additional shares, Ventas beneficially owned approximately 6.5% of our outstanding common stock.
Medicare and Medicaid regulations and various managed care contracts under which estimates of contractual adjustments must be calculated are complex and are subject to interpretation and adjustment. We estimate contractual adjustments on a payor-specific basis based on our interpretation of the applicable regulations or contract terms and the historical collections of each payor.
Medicare and Medicaid regulations and various managed care contracts under which estimates of contractual adjustments must be calculated are complex and are subject to interpretation and adjustment. We estimate contractual adjustments on a payor-specific basis based on our interpretation of the applicable regulations or contract terms and the historical collection experience of each payor.
(c) Restructuring, exit and acquisition-related costs represent (i) enterprise restructuring costs, including severance costs related to work force reductions of $0.3 million and $10.4 million for the three and twelve months ended December 31, 2024, respectively, (ii) penalties and costs incurred for terminating pre-existing contracts at acquired facilities of $0.2 million and $0.8 million for the three and twelve months ended December 31, 2024, respectively, and (iii) third party professional fees and expenses, salaries and benefits, and other internal expenses incurred in connection with potential and completed acquisitions of $0.6 million and $1.6 million for the three and twelve months ended December 31, 2024, respectively.
(c) Restructuring, exit and acquisition-related costs represent (i) enterprise restructuring costs, including severance costs related to work force reductions of $4.3 million and $10.3 million for the three months ended and year ended December 31, 2025, respectively, (ii) penalties and costs incurred for terminating pre-existing contracts at acquired facilities of $0.8 million and $1.2 million for the three months ended and year ended December 31, 2025, respectively, and (iii) third party professional fees and expenses, salaries and benefits, and other internal expenses incurred in connection with potential and completed acquisitions of $0.2 million and $1.8 million for the three months ended and year ended December 31, 2025, respectively.
We account for uncertain tax positions in accordance with Accounting Standards Codification ("ASC") 740, Income Taxes ("ASC 740"), which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Only tax positions that meet the more-likely-than-not recognition threshold may be recognized.
We account for uncertain tax positions in accordance with Accounting Standards Codification (“ASC”) 740, Income Taxes (“ASC 740”), which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Only tax positions that meet the more-likely-than-not recognition threshold may be recognized.
Epic expenses do not include the ongoing costs of the Epic system. 77 Liquidity and Capital Resources Liquidity Our primary sources of liquidity are available cash and cash equivalents, cash flows from our operations and available borrowings under our ABL Facilities (as defined below).
Epic expenses do not include ongoing operating costs of the Epic system. 71 Liquidity and Capital Resources Liquidity Our primary sources of liquidity are available cash and cash equivalents, cash flows from our operations and available borrowings under our ABL Facilities (as defined below).
Epic expenses do not include the ongoing costs of the Epic system.
Epic expenses do not include ongoing operating costs of the Epic system.
The terms of the 5.75% Senior Notes, which mature on July 15, 2029, are governed by an indenture, dated as of July 8, 2021 (the “2029 Notes Indenture”), among the Issuer, us and certain of the Issuer's wholly-owned domestic subsidiaries, as guarantors, and U.S. Bank Trust Company, National Association, as trustee.
The terms of the 5.75% Senior Notes, which mature on July 15, 2029, are governed by an indenture, dated as of July 8, 2021 (the "2029 Notes Indenture"), among the Issuer, us and certain of the Issuer's wholly-owned domestic subsidiaries, as guarantors, and U.S. Bank, National Association, as trustee.
Geographic Data The information below provides an overview of our operations in certain markets as of December 31, 2024. Texas .
Geographic Data The information below provides an overview of our operations in certain markets as of December 31, 2025. Texas .
(b) Cybersecurity Incident recoveries, net represents insurance recovery proceeds associated with the Cybersecurity Incident, net of incremental information technology and litigation costs.
(b) Cybersecurity Incident recoveries, net represent insurance recovery proceeds associated with the Cybersecurity Incident, net of incremental information technology and litigation costs.
We believe our estimation processes at each of our hospital facilities provide reasonable estimates of our revenue and valuation of our accounts receivable. Risk Management and Self-Insured Liabilities We maintain certain claims-made commercial insurance related to our professional liability risks and occurrence-based commercial insurance related to our workers’ compensation and general liability risks.
We believe our estimation processes provide reasonable estimates of our revenue and valuation of our accounts receivable. Risk Management and Self-Insured Liabilities We maintain certain claims-made commercial insurance related to our professional liability risks and occurrence-based commercial insurance related to our workers’ compensation and general liability risks.
We operated five acute care hospital facilities with 619 licensed beds that serve the areas of Albuquerque and Roswell, New Mexico. For the year ended December 31, 2024, we generated 16.0% of our total revenue in the New Mexico market. New Jersey .
We operated five acute care hospital facilities with 619 licensed beds that serve the areas of Albuquerque and Roswell, New Mexico. For the year ended December 31, 2025, we generated 17.0% of our total revenue in the New Mexico market. New Jersey .
(e) Epic expenses consist of various costs incurred in connection with the implementation of Epic, our health information technology system.
(f) Epic expenses consist of various costs incurred in connection with the implementation of Epic, our health information technology system.
The increase in professional fees, as a percentage of total revenue, was attributable to increased cost for hospital-based care providers due to higher patient volumes and rising physician-related expenses. Supplies — Supplies, as a percentage of total revenue, were 17.3% for the year ended December 31, 2024 compared to 18.4% for the prior year.
The increase in professional fees, as a percentage of total revenue, was attributable to increased cost for hospital-based care providers due to higher patient volumes and rising physician-related expenses. Supplies — Supplies, as a percentage of total revenue, were 17.1% for the year ended December 31, 2025 compared to 17.3% for the prior year.
We estimate receivables for the portion of workers’ compensation liability accrual that is recoverable under our insurance policies. At December 31, 2024 and 2023, such receivables were $12.3 million and $13.3 million, respectively, of which $8.2 million and $8.7 million, respectively, were included in other assets and $4.1 million and $4.6 million, respectively, were included in other current assets.
We estimate receivables for the portion of workers’ compensation liability accrual that is recoverable under our insurance policies. At December 31, 2025 and 2024, such receivables were $12.9 million and $12.3 million, respectively, of which $8.2 million and $8.2 million, respectively, were included in other assets and $4.7 million and $4.1 million, respectively, were included in other current assets.
(d) Restructuring, exit and acquisition-related costs represent (i) enterprise restructuring costs, including severance costs related to work force reductions of $10.4 million, $12.4 million, and $13.9 million for the years ended December 31, 2024, 2023, and 2022, respectively, (ii) penalties and costs incurred for terminating pre-existing contracts at acquired facilities of $0.8 million, $0.7 million, and $0.9 million for the years ended December 31, 2024, 2023, and 2022, respectively, and (iii) third party professional fees and expenses, salaries and benefits, and other internal expenses incurred in connection with potential and completed acquisitions of $1.6 million, $0.5 million, and $0.9 million for the years ended December 31, 2024, 2023, and 2022, respectively.
(c) Restructuring, exit and acquisition-related costs represent (i) enterprise restructuring costs, including severance costs related to work force reductions of $10.3 million, $10.4 million, and $12.4 million for the years ended December 31, 2025, 2024, and 2023, respectively, (ii) penalties and costs incurred for terminating pre-existing contracts at acquired facilities of $1.2 million, $0.8 million, and $0.7 million for the years ended December 31, 2025, 2024, and 2023, respectively, and (iii) third party professional fees and expenses, salaries and benefits, and other internal expenses incurred in connection with potential and completed acquisitions of $1.8 million, $1.6 million, and $0.5 million for the years ended December 31, 2025, 2024, and 2023, respectively.
Our critical accounting estimates cover the following areas: • Revenue recognition; • Risk management and self-insured liabilities; and • Income taxes See Note 2, "Summary of Significant Accounting Policies," to our consolidated financial statements for information about these critical accounting policies, as well as a description of our other significant accounting policies.
Our critical accounting estimates cover the following areas: • Revenue recognition; • Risk management and self-insured liabilities; and • Income taxes See Note 2, Summary of Significant Accounting Policies, to our consolidated financial statements included within this Annual Report for information about these critical accounting policies, as well as a description of our other significant accounting policies.
We define these terms as follows: Performance Measure • “Adjusted EBITDA” is defined as net income plus (i) provision for income taxes, (ii) interest expense and (iii) depreciation and amortization expense (or EBITDA), as adjusted to deduct noncontrolling interest earnings, and excludes the effects of losses on the extinguishment and modification of debt; certain legal matters and related costs; other non-operating losses (gains); Cybersecurity Incident recoveries, net of incremental information technology and litigation costs; restructuring, exit and acquisition-related costs; expenses incurred in connection with the implementation of Epic Systems (“Epic”), our integrated health information technology system, equity-based compensation expense, and loss (income) from disposed operations.
We define these terms as follows: Performance Measure • “Adjusted EBITDA” is defined as net income plus (i) provision for income taxes, (ii) interest expense and (iii) depreciation and amortization expense (or EBITDA), as adjusted to deduct noncontrolling interest earnings, and excludes the effects of loss on extinguishment and modification of debt; other non-operating (gains) losses; Cybersecurity Incident recoveries, net of incremental information technology and litigation costs; certain legal matters and related costs; restructuring, exit and acquisition-related costs; change in accounting estimate; New Mexico professional liability accrual; expenses incurred in connection with the implementation of our integrated health information technology system provided by Epic Systems; equity-based compensation expense; and loss (income) from disposed operations.
Adjusted EBITDAR has inherent material limitations as a valuation measure, because it adds back certain expenses to net income, resulting in those expenses not being taken into account in the valuation measure. The payment of taxes and rent is a necessary element of our valuation.
Adjusted EBITDAR has inherent material limitations as a valuation measure, because it adds back certain expenses to net income, resulting in those expenses not being taken into account in the valuation measure. The payment rent is a necessary element of our valuation. Because Adjusted EBITDAR excludes this and other items, it has material limitations as a measure of our valuation.
Adjusted EBITDA is a performance measure that is not defined under GAAP and is presented in this Annual Report because our management considers it an important analytical indicator that is commonly used within the healthcare industry to evaluate financial performance and allocate resources.
Adjusted EBITDA is a performance measure that is not prepared in accordance with GAAP and is presented in this Annual Report because our management considers it an important analytical indicator that is commonly used within the healthcare industry to evaluate financial performance and allocate resources.
Rents and leases, related party, were $149.2 million and $145.9 million for the years ended December 31, 2024 and 2023, respectively. Other operating expenses — Other operating expenses, as a percentage of total revenue, were 8.2% for the year ended December 31, 2024 compared to 8.3% for the prior year.
Rents and leases, related party, were $152.9 million and $149.2 million for the years ended December 31, 2025 and 2024, respectively. Other operating expenses — Other operating expenses, as a percentage of total revenue, were 10.3% for the year ended December 31, 2025 compared to 8.2% for the prior year.
As of December 31, 2024, we maintained outstanding letters of credit of approximately $40.6 million, which included interest of $3.6 million. Supplemental Non-GAAP Valuation Measure Adjusted EBITDAR is a commonly used non-GAAP valuation measure used by our management, research analysts, investors and other interested parties to evaluate and compare the enterprise value of different companies in our industry.
As of December 31, 2025, we maintained outstanding letters of credit of approximately $33.4 million, which included interest of $3.0 million. Supplemental Non-GAAP Valuation Measure Adjusted EBITDAR is a commonly used non-GAAP valuation measure used by our management, research analysts, investors and other interested parties to evaluate and compare the enterprise value of different companies in our industry.
During the years ended December 31, 2023 and 2022, we received and recognized $8.5 million and $49.9 million, respectively, of cash distributions from the Public Health and Social Services Emergency Fund (“Provider Relief Fund”), a provision of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), and other state and local programs.
During the year ended December 31, 2023, we received and recognized $8.5 million of cash distributions from the Public Health and Social Services Emergency Fund (“Provider Relief Fund”), a provision of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), and other state and local programs.
The 5.75% Senior Notes bear interest at a rate of 5.75% per annum, payable semi-annually, in cash in arrears, on January 15 and July 15 of each year, commencing on January 15, 2022.
The 5.75% Senior Notes bear interest at a rate of 5.75% per annum, which is payable semi-annually, in cash in arrears, on January 15 and July 15 of each year.
The increase in net patient service revenue per adjusted admission was attributable to a combination of a favorable payor mix, improved service mix as a result of ongoing service line optimization efforts, and an increase in supplemental funding compared to the prior year.
The increase in net patient service revenue per adjusted admission was attributable to a combination of a favorable payor mix, improved service mix as a result of ongoing service line optimization efforts, and an increase in revenue from Medicaid supplemental payment programs compared to the prior year.
Net patient service revenue reflects gross inpatient and outpatient charges less estimated contractual adjustments, uninsured discounts, implicit price concessions, and other discounts. Overview of the Year Ended December 31, 2024 Total revenue for the year ended December 31, 2024 increased $556.6 million, or 10.3%, compared to the prior year.
Net patient service revenue reflects gross inpatient and outpatient charges less estimated contractual adjustments, uninsured discounts, implicit price concessions, and other discounts. Overview of the Year Ended December 31, 2025 Total revenue for the year ended December 31, 2025 increased $358.3 million, or 6.0%, compared to the prior year.
We rely on the results of detailed reviews of historical collections at facilities that represent a majority of our revenues and accounts receivable (the “hindsight analysis”) as a primary source of information in estimating the collectability of our accounts receivable. We perform the hindsight analysis utilizing twelve-month rolling accounts receivable collection data.
We consider historical collection experience of each payor and the results of detailed reviews of historical collections at facilities that represent a majority of our revenues and accounts receivable (the “hindsight analysis”) as a primary source of information in estimating the collectability of our accounts receivable. We perform the hindsight analysis utilizing twelve-month rolling accounts receivable collection data.
Our common stock is listed on the New York Stock Exchange under the symbol "ARDT".
Our common stock is listed on the New York Stock Exchange under the symbol “ARDT”.
We recognize deferred tax assets and liabilities representing the future tax consequences attributable to differences between the financial reporting and tax bases of assets and liabilities. The primary differences relate to the allowance for doubtful accounts, accrued liabilities, depreciation methods and periods, and deferred cost amortization methods.
We recognize deferred tax assets and liabilities representing the future tax consequences attributable to differences between the financial reporting and tax bases of assets and liabilities. The primary differences relate to the allowance on patient receivable accounts, accrued liabilities, depreciation methods and periods, and deferred cost amortization methods.
See “Supplemental Non-GAAP Valuation Measure.” Supplemental Non-GAAP Performance Measure Adjusted EBITDA is a non-GAAP performance measure used by our management and external users of our financial statements, such as investors, analysts, lenders, rating agencies and other interested parties, to evaluate companies in our industry.
(“MPT”) for Hackensack Meridian Mountainside Medical Center. See “Supplemental Non-GAAP Valuation Measure.” Supplemental Non-GAAP Performance Measure Adjusted EBITDA is a non-GAAP performance measure used by our management and external users of our financial statements, such as investors, analysts, lenders, rating agencies and other interested parties, to evaluate companies in our industry.
We regularly evaluate the accounting policies and estimates we use. In general, we base the estimates on historical experience and on assumptions that we believe to be reasonable, given the particular circumstances in which we operate. Actual results may vary from those estimates.
In general, we base the estimates on historical experience and on assumptions that we believe to be reasonable, given the particular circumstances in which we operate. Actual results may vary from those estimates.
We operated two acute care hospital facilities with 476 licensed beds that serve the areas of Montclair and Westwood, New Jersey. For the year ended December 31, 2024, we generated 9.8% of our total revenue in the New Jersey market.
We operated two acute care hospital facilities with 476 licensed beds that serve the areas of Montclair and Westwood, New Jersey. For the year ended December 31, 2025, we generated 10.2% of our total revenue in the New Jersey market.
During the years ended December 31, 2024, 2023, and 2022, total revenue related to these 69 JV entities was $1,732.1 million, $1,600.0 million, and $1,468.1 million, respectively, which represented 29.0%, 29.6%, and 28.6%, respectively, of our total revenue for such periods.
During the years ended December 31, 2025, 2024, and 2023, total revenue related to these JV entities was $1,843.1 million, $1,732.1 million, and $1,600.0 million, respectively, which represented 29.1%, 29.0%, and 29.6%, respectively, of our total revenue for such periods.
The estimated costs incurred by us to provide services to patients who qualified for charity care were $43.9 million, $46.0 million, and $50.6 million for the years ended December 31, 2024, 2023, and 2022, respectively.
The estimated costs incurred by us to provide services to patients who qualified for charity care were $55.8 million, $43.9 million, and $46.0 million for the years ended December 31, 2025, 2024, and 2023, respectively.
The total costs for professional and general liability losses are based on our premiums and retention costs and were $63.0 million, $55.5 million, and $100.6 million during the years ended December 31, 2024, 2023, and 2022, respectively.
The total costs for professional and general liability losses are based on our premiums and retention costs and were $131.3 million, $63.0 million, and $55.5 million during the years ended December 31, 2025, 2024, and 2023, respectively.
These costs included professional fees of $3.1 million, $1.8 million, and $1.8 million for the years ended December 31, 2024, 2023, and 2022, respectively, and salaries and benefits of $0.1 million for the year ended December 31, 2024, and other expenses related to one-time training and onboarding support costs of $0.1 million for the year ended December 31, 2022.
These costs included (i) professional fees of $2.1 million, $3.1 million, and $1.8 million for the years ended December 31, 2025, 2024, and 2023, respectively, (ii) salaries and benefits of $2.6 million and $0.1 million for the years ended December 31, 2025 and 2024, respectively, and (iii) other expenses related to one-time training and onboarding support costs of $0.1 million for the year ended December 31, 2025.
The repricing reduced the applicable interest rate by 50 basis points from Term SOFR (as defined in the Term Loan B Credit Agreement) plus 3.25% to Term SOFR plus 2.75% and from base rate plus 2.25% to base rate plus 1.75%, and it eliminated the credit spread adjustment.
The repricing reduced the applicable interest rate by 50 basis points from Term SOFR plus 3.25% to Term SOFR plus 2.75% and from the base rate plus 2.25% to the base rate plus 1.75%, and it eliminated the credit spread adjustment.
At December 31, 2024 and 2023, our workers’ compensation liability accrual for asserted and unasserted claims was $31.8 million and $32.6 million, respectively, of which $21.1 million and $21.3 million, respectively, were included in self-insured liabilities and $10.7 million and $11.3 million, respectively, were included in other accrued expenses and liabilities in the consolidated balance sheets.
At December 31, 2025 and 2024, our workers’ compensation liability accrual for asserted and unasserted claims was $25.7 million and $31.8 million, respectively, of which $16.4 million and $21.1 million, respectively, were included in self-insured liabilities and $9.3 million and $10.7 million, respectively, were included in other accrued expenses and liabilities in the consolidated balance sheets.
Income from operations before income taxes related to these limited liability companies was $285.6 million and $243.7 million for the years ended December 31, 2024 and 2023, respectively.
Income from operations before income taxes related to these limited liability companies was $296.5 million and $285.6 million for the years ended December 31, 2025 and 2024, respectively.
The increase in total revenue for the year ended December 31, 2024 consisted of an increase in adjusted admissions of 4.8% and an increase in net patient service revenue per adjusted admission of 5.1%. The increase in adjusted admissions reflected growth in admissions, total surgeries and emergency room visits of 7.1%, 0.7% and 4.5%, respectively.
The increase in total revenue for the year ended December 31, 2025 consisted of an increase in adjusted admissions of 2.3% and an increase in net patient service revenue per adjusted admission of 3.5%. The increase in adjusted admissions reflected growth in admissions, total surgeries and emergency room visits of 5.3%, 0.2% and 0.2%, respectively.
The increase in total revenue for the year ended December 31, 2024 consisted of an increase in adjusted admissions of 4.8% and an increase in net patient service revenue per adjusted admission of 5.1%. The increase in adjusted admissions reflected growth in admissions, total surgeries and emergency room visits of 7.1%, 0.7% and 4.5%, respectively.
The increase in total revenue for the year ended December 31, 2025 consisted of an increase in adjusted admissions of 2.3% and an increase in net patient service revenue per adjusted admission of 3.5%. The increase in adjusted admissions reflected growth in admissions, total surgeries and emergency room visits of 5.3%, 0.2% and 0.2%, respectively.
At December 31, 2024 and 2023, our settlements under reimbursement agreements with third party payors were a net receivable and a net payable of $1.9 million and $10.3 million, respectively, of which a receivable of $42.6 million and $34.4 million, respectively, was included in other current assets and a payable of $40.7 million and $44.7 million, respectively, was included in other accrued expenses and liabilities in the consolidated balance sheets. 84 Final determination of amounts earned under prospective payment and other reimbursement activities is subject to review by appropriate governmental authorities or their agents.
At December 31, 2025 and 2024, our settlements under reimbursement agreements with third party payors were a net payable of $7.8 million and a net receivable of $2.6 million, respectively, of which a receivable of $21.1 million and $29.9 million, respectively, was included in other current assets and a payable of $28.9 million and $27.3 million, respectively, was included in other accrued expenses and liabilities in the consolidated balance sheets. 77 Final determination of amounts earned under prospective payment and other reimbursement activities is subject to review by appropriate governmental authorities or their agents.
Comparison of the Years Ended December 31, 2024 and 2023 Total revenue — Total revenue for the year ended December 31, 2024 increased $556.6 million, or 10.3%, compared to the prior year.
Comparison of the Years Ended December 31, 2025 and 2024 Total revenue — Total revenue for the year ended December 31, 2025 increased $358.3 million, or 6.0%, compared to the prior year.
While management monitors current claims closely and considers outcomes when estimating its reserve, the complexity of the claims 85 and wide range of potential outcomes often hamper timely adjustments to the assumptions used in the estimates.
Changes to the estimated reserve amounts are included in current operating results. While management monitors current claims closely and considers outcomes when estimating its reserve, the complexity of the claims and wide range of potential outcomes often hamper timely adjustments to the assumptions used in the estimates.
Other non-operating gains — Other non-operating gains were $26.3 million and $1.6 million for the years ended December 31, 2024 and 2023, respectively.
Other non-operating gains — Other non-operating gains were $23.3 million and $26.3 million for the years ended December 31, 2025 and 2024, respectively.
We routinely review accounts receivable balances by monitoring historical cash collections as a percentage of trailing net operating revenue, as well as by analyzing current period revenue and admissions by payor, aged accounts receivable by payor, days revenue outstanding, and the composition of self-pay receivables. In May 2022, we outsourced our revenue cycle management functions to Ensemble.
We routinely review accounts receivable balances by monitoring historical cash collections as a percentage of trailing net operating revenue, as well as by analyzing current period revenue and admissions by payor, aged accounts receivable by payor, days revenue outstanding, and the composition of self-pay receivables.
At December 31, 2024 and 2023, our professional and general liability accrual for asserted and unasserted claims was $240.0 million and $275.0 million, respectively, of which $206.0 million and $219.9 million, respectively, were included in self-insured liabilities and $34.0 million and $55.1 million, respectively, were included in other accrued expenses and liabilities in the consolidated balance sheets.
At December 31, 2025 and 2024, our professional and general liability accrual for asserted and unasserted claims was $284.6 million and $240.0 million, respectively, of which $224.1 million and $206.0 million, respectively, were included in self-insured liabilities and $60.5 million and $34.0 million, respectively, were included in other accrued expenses and liabilities in the consolidated balance sheets.
("Ventas"), contributed all of its outstanding common stock in AHP Health Partners, Inc. ("AHP Health Partners"), our direct subsidiary, to Ardent Health Partners, Inc. in exchange for 5,178,202 shares of common stock of Ardent Health Partners, Inc. (the "ALH Contribution").
(“Ventas”), contributed all of its outstanding common stock in AHP Health Partners, Inc. (“AHP Health Partners”), our direct subsidiary, to Ardent Health Partners, Inc. in exchange for 5,178,202 shares of common stock of Ardent Health Partners, Inc. (the “ALH Contribution”).
For the year ended December 31, 2024, we generated 36.0% of our total revenue in the Texas market. 68 Oklahoma . We operated eight acute care hospital facilities with 1,173 licensed beds that serve the area of Tulsa, Oklahoma. For the year ended December 31, 2024, we generated 24.2% of our total revenue in the Oklahoma market. New Mexico .
For the year ended December 31, 2025, we generated 35.7% of our total revenue in the Texas market. Oklahoma . We operated eight acute care hospital facilities with 1,173 licensed beds that serve the area of Tulsa, Oklahoma. For the year ended December 31, 2025, we generated 23.6% of our total revenue in the Oklahoma market. New Mexico .
Rents and leases — Rents and leases were $103.6 million and $97.4 million for the years ended December 31, 2024 and 2023, respectively.
Rents and leases — Rents and leases were $109.6 million and $103.6 million for the years ended December 31, 2025 and 2024, respectively.
Total revenue for the year ended December 31, 2023 increased $279.8 million, or 5.5%, compared to the prior year. The increase in total revenue was attributable to an increase in adjusted admissions of 5.0% and an increase in net patient service revenue per adjusted admission of 0.6% compared to the prior year.
Total revenue for the year ended December 31, 2025 increased $358.3 million, or 6.0%, compared to the prior year. The increase in total revenue for the year ended December 31, 2025 consisted of an increase in adjusted admissions of 2.3% and an increase in net patient service revenue per adjusted admission of 3.5%.
Cash Flows The following table summarizes certain elements of the statements of cash flows (in thousands): Years Ended December 31, 2024 2023 2022 Net cash provided by (used in) operating activities $ 315,026 $ 221,698 $ (38,359) Net cash (used in) provided by investing activities (220,460) (137,983) 46,578 Net cash provided by (used in) financing activities 24,642 (102,262) (270,331) Operating Activities Cash flows provided by operating activities for the year ended December 31, 2024 totaled $315.0 million compared to $221.7 million for the prior year.
Cash Flows The following table summarizes certain elements of the statements of cash flows (in thousands): Years Ended December 31, 2025 2024 2023 Net cash provided by operating activities $ 470,510 $ 315,026 $ 221,698 Net cash used in investing activities (214,229) (220,460) (137,983) Net cash (used in) provided by financing activities (103,465) 24,642 (102,262) Operating Activities Cash flows provided by operating activities for the year ended December 31, 2025 totaled $470.5 million compared to $315.0 million for the prior year.
While our operations were no longer materially disrupted as of December 31, 2024, we continued to experience delays in billing claims and obtaining reimbursements and payments through the first quarter of 2024, and incurred certain expenses related to the Cybersecurity Incident, including expenses to defend claims brought by individuals and other expenses related to the Cybersecurity Incident.
We continued to experience delays in billing claims and obtaining reimbursements and payments through the first quarter of 2024, and incurred certain expenses related to the Cybersecurity Incident, including expenses to defend claims brought by individuals and other expenses related to the Cybersecurity Incident.
At December 31, 2024 and 2023, such receivables were $72.8 million and $99.8 million, respectively, of which $62.5 million and $79.7 million, respectively, were included in other assets and $10.3 million and $20.1 million, respectively, were included in other current assets.
At December 31, 2025 and 2024, such receivables were $103.5 million and $72.8 million, respectively, of which $53.7 million and $62.5 million, respectively, were included in other assets and $49.8 million and $10.3 million, respectively, were included in other current assets.
Net income attributable to noncontrolling interests — Net income attributable to noncontrolling interests of $89.4 million for the year ended December 31, 2024 compared to $75.1 million for the prior year consisted primarily of $85.3 million and $57.5 million of net income attributable to minority partners’ interests in hospitals and ambulatory services that are owned and operated through limited liability companies and consolidated by us for the years ended December 31, 2024 and 2023, respectively.
This net income consisted primarily of $94.3 million and $85.3 million of net income attributable to minority partners’ interests in hospitals and ambulatory services that are owned and operated through limited liability companies and consolidated by us for the years ended December 31, 2025 and 2024, respectively.
The following table provides the sources of our total revenue by payor: Years Ended December 31, 2024 2023 2022 Medicare 39.2 % 39.5 % 40.6 % Medicaid 10.3 % 11.2 % 11.5 % Other managed care 43.5 % 42.6 % 41.6 % Self-pay and other 5.2 % 5.0 % 4.3 % Net patient service revenue 98.2 % 98.3 % 98.0 % Other revenue 1.8 % 1.7 % 2.0 % Total revenue 100.0 % 100.0 % 100.0 % 70 Operating Results Summary for the Years Ended December 31, 2024, 2023, and 2022 The following table sets forth, for the periods indicated, the consolidated results of our operations expressed in dollars and as a percentage of total revenue: Years Ended December 31, (Dollars in thousands) 2024 2023 2022 Amount % Amount % Amount % Total revenue $ 5,966,072 100.0 % $ 5,409,483 100.0 % $ 5,129,687 100.0 % Expenses: Salaries and benefits 2,534,756 42.5 % 2,384,062 44.1 % 2,411,677 47.0 % Professional fees 1,097,119 18.4 % 980,270 18.1 % 736,299 14.4 % Supplies 1,033,122 17.3 % 993,405 18.4 % 955,168 18.6 % Rents and leases 103,577 1.7 % 97,444 1.8 % 93,047 1.8 % Rents and leases, related party 149,229 2.5 % 145,880 2.7 % 130,657 2.5 % Other operating expenses 496,219 8.2 % 451,737 8.3 % 464,413 9.1 % Government stimulus income — 0.0 % (8,463) (0.2) % (16,775) (0.3) % Interest expense 65,578 1.1 % 74,305 1.4 % 72,582 1.4 % Interest expense, related party — 0.0 % — 0.0 % 9,470 0.2 % Depreciation and amortization 146,288 2.5 % 140,842 2.6 % 138,173 2.7 % Loss on extinguishment and modification of debt 3,388 0.1 % — 0.0 % — 0.0 % Other non-operating gains (26,264) (0.4) % (1,613) 0.0 % (18,694) (0.4) % Other non-operating gains, related party — 0.0 % — 0.0 % (157,808) (3.1) % Total operating expenses 5,603,012 93.9 % 5,257,869 97.2 % 4,818,209 93.9 % Income before income taxes 363,060 6.1 % 151,614 2.8 % 311,478 6.1 % Income tax expense 63,352 1.1 % 22,637 0.4 % 46,107 0.9 % Net income 299,708 5.0 % 128,977 2.4 % 265,371 5.2 % Net income attributable to noncontrolling interests 89,365 1.5 % 75,073 1.4 % 76,462 1.5 % Net income attributable to Ardent Health Partners, Inc. $ 210,343 3.5 % $ 53,904 1.0 % $ 188,909 3.7 % 71 The following table provides information on certain drivers of our total revenue: Years Ended December 31, Consolidated Operating Statistics 2024 % Change 2023 % Change 2022 Total revenue (in thousands) $5,966,072 10.3 % $5,409,483 5.5 % $5,129,687 Hospitals operated (at period end) (1) 30 (3.2) % 31 0.0 % 31 Licensed beds (at period end) (2) 4,281 (1.0) % 4,323 0.0 % 4,323 Utilization of licensed beds (3) 46 % 2.2 % 45 % 2.3 % 44 % Admissions (4) 157,295 7.1 % 146,887 3.6 % 141,753 Adjusted admissions (5) 341,781 4.8 % 326,029 5.0 % 310,374 Inpatient surgeries (6) 35,937 2.3 % 35,127 1.8 % 34,502 Outpatient surgeries (7) 93,497 0.0 % 93,461 4.3 % 89,602 Total surgeries 129,434 0.7 % 128,588 3.6 % 124,104 Emergency room visits (8) 636,222 4.5 % 609,010 0.3 % 606,963 Patient days (9) 724,363 2.3 % 708,043 1.7 % 696,249 Total encounters (10) 5,785,709 6.9 % 5,413,787 3.8 % 5,213,949 Average length of stay (11) 4.61 (4.4) % 4.82 (1.8) % 4.91 Net patient service revenue per adjusted admission (12) $17,144 5.1 % $16,307 0.6 % $16,207 (1) “Hospitals operated (at period end).” This metric represents the total number of hospitals operated by us at the end of the applicable period, irrespective of whether the hospital real estate is (i) owned by us, (ii) leased by us or (iii) held through a controlling interest in a JV.
The following table provides the sources of our total revenue by payor: Years Ended December 31, 2025 2024 2023 Medicare 38.6 % 39.2 % 39.5 % Medicaid 9.6 % 10.3 % 11.2 % Other managed care 44.3 % 43.5 % 42.6 % Self-pay and other 5.6 % 5.2 % 5.0 % Net patient service revenue 98.1 % 98.2 % 98.3 % Other revenue 1.9 % 1.8 % 1.7 % Total revenue 100.0 % 100.0 % 100.0 % 64 65 Operating Results Summary for the Years Ended December 31, 2025, 2024, and 2023 The following table sets forth, for the periods indicated, the consolidated results of our operations expressed in dollars and as a percentage of total revenue: Years Ended December 31, (Dollars in thousands) 2025 2024 2023 Amount % Amount % Amount % Total revenue $ 6,324,339 100.0 % $ 5,966,072 100.0 % $ 5,409,483 100.0 % Expenses: Salaries and benefits 2,657,700 42.0 % 2,534,756 42.5 % 2,384,062 44.1 % Professional fees 1,192,645 18.9 % 1,097,119 18.4 % 980,270 18.1 % Supplies 1,082,908 17.1 % 1,033,122 17.3 % 993,405 18.4 % Rents and leases 109,586 1.7 % 103,577 1.7 % 97,444 1.8 % Rents and leases, related party 152,905 2.4 % 149,229 2.5 % 145,880 2.7 % Other operating expenses 647,308 10.3 % 496,219 8.2 % 451,737 8.3 % Government stimulus income — 0.0 % — 0.0 % (8,463) (0.2) % Interest expense 55,202 0.9 % 65,578 1.1 % 74,305 1.4 % Depreciation and amortization 155,703 2.5 % 146,288 2.5 % 140,842 2.6 % Loss on extinguishment and modification of debt 7,344 0.1 % 3,388 0.1 % — 0.0 % Other non-operating gains (23,320) (0.4) % (26,264) (0.4) % (1,613) 0.0 % Total operating expenses 6,037,981 95.5 % 5,603,012 93.9 % 5,257,869 97.2 % Income before income taxes 286,358 4.5 % 363,060 6.1 % 151,614 2.8 % Income tax expense 56,223 0.9 % 63,352 1.1 % 22,637 0.4 % Net income 230,135 3.6 % 299,708 5.0 % 128,977 2.4 % Net income attributable to noncontrolling interests 94,324 1.5 % 89,365 1.5 % 75,073 1.4 % Net income attributable to Ardent Health, Inc. $ 135,811 2.1 % $ 210,343 3.5 % $ 53,904 1.0 % 66 The following table provides information on certain drivers of our total revenue: Years Ended December 31, Consolidated Operating Statistics 2025 % Change 2024 % Change 2023 Total revenue (in thousands) $6,324,339 6.0 % $5,966,072 10.3 % $5,409,483 Hospitals operated (at period end) (1) 30 0.0 % 30 (3.2) % 31 Licensed beds (at period end) (2) 4,281 0.0 % 4,281 (1.0) % 4,323 Utilization of licensed beds (3) 50 % 8.7 % 46 % 2.2 % 45 % Admissions (4) 165,682 5.3 % 157,295 7.1 % 146,887 Adjusted admissions (5) 349,614 2.3 % 341,781 4.8 % 326,029 Inpatient surgeries (6) 38,288 6.5 % 35,937 2.3 % 35,127 Outpatient surgeries (7) 91,361 (2.3) % 93,497 0.0 % 93,461 Total surgeries 129,649 0.2 % 129,434 0.7 % 128,588 Emergency room visits (8) 637,325 0.2 % 636,222 4.5 % 609,010 Patient days (9) 777,361 7.3 % 724,363 2.3 % 708,043 Total encounters (10) 6,102,034 5.5 % 5,785,709 6.9 % 5,413,787 Average length of stay (11) 4.69 1.7 % 4.61 (4.4) % 4.82 Net patient service revenue per adjusted admission (12) $17,748 3.5 % $17,144 5.1 % $16,307 (1) “Hospitals operated (at period end).” This metric represents the total number of hospitals operated by us at the end of the applicable period, irrespective of whether the hospital real estate is (i) owned by us, (ii) leased by us or (iii) held through a controlling interest in a JV.
See “Supplemental Non-GAAP Performance Measure.” Valuation Measure • “Adjusted EBITDAR” is defined as Adjusted EBITDA further adjusted to add back rent expense payable to real estate investment trusts ("REITs"), which consists of rent expense pursuant to the Ventas Master Lease, lease agreements associated with the MOB Transactions and a lease arrangement with MPT for Hackensack Meridian Mountainside Medical Center.
See “Supplemental Non-GAAP Performance Measure.” Valuation Measure • “Adjusted EBITDAR” is defined as Adjusted EBITDA further adjusted to add back rent expense payable to real estate investment trusts (“REITs”), which consists of rent expense pursuant to the Ventas Master Lease, lease agreements with Ventas for 18 medical office buildings and a lease arrangement with Medical Properties Trust, Inc.
Because not all companies use identical calculations, our presentation of the non-GAAP measure may not be comparable to other similarly titled measures of other companies. 82 While we believe this is a useful supplemental valuation measure for investors and other users of our financial information, you should not consider the non-GAAP measure in isolation or as a substitute for net income or any other items calculated in accordance with GAAP.
While we believe this is a useful supplemental valuation measure for investors and other users of our financial information, you should not consider the non-GAAP measure in isolation or as a substitute for net income or any other items calculated in accordance with GAAP.
Seasonality We typically experience higher patient volumes and revenue in the fourth quarter of each year in our acute care facilities. We typically experience such seasonal volume and revenue peaks because more people generally become ill during the winter months, which in turn results in significant increases in the number of patients we treat during those months.
We typically experience such seasonal volume and revenue peaks because more people generally become ill during the winter months, which in turn results in significant increases in the number of patients we treat during those months.
At December 31, 2024, we had total cash and cash equivalents of $556.8 million and available liquidity of $844.8 million. Our available liquidity was comprised of $556.8 million of total cash and cash equivalents plus $288.0 million in available capacity under the ABL Credit Agreement, which is reduced by outstanding borrowings and outstanding letters of credit.
At December 31, 2025, we had total cash and cash equivalents of $709.6 million and available liquidity of $1,004.2 million. Our available liquidity was comprised of $709.6 million of total cash and cash equivalents plus $294.6 million in available capacity under the ABL Credit Agreement, which is reduced by outstanding borrowings and outstanding letters of credit.
The increase in operating cash flows during the year ended December 31, 2024 was primarily attributable to an increase in net income of $170.7 million.
Cash flows provided by operating activities for the year ended December 31, 2024 totaled $315.0 million compared to $221.7 million for the prior year. The increase in operating cash flows during the year ended December 31, 2024 was primarily attributable to an increase in net income of $170.7 million.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs of December 31, 2024, we had outstanding variable rate debt of $766.6 million. At December 31, 2024, we had interest rate swap agreements with notional amounts totaling $402.5 million, expiring June 30, 2026.
Biggest changeAs of December 31, 2025, we had outstanding variable rate debt of $765.3 million. At December 31, 2025, we had interest rate swap agreements with notional amounts totaling $280.9 million and $119.5 million, expiring June 30, 2026 and June 26, 2029, respectively.
While we do not anticipate any of our current lenders defaulting on their obligations, we are unable to provide assurance that any particular lender will not default at a future date.
While we do not anticipate any of our current lenders defaulting on their obligations, we are unable to provide assurance that any particular lender will not default at a future date. 79
We currently believe we have adequate liquidity to fund operations during the near term through the generation of operating cash flows, cash on hand and access to our Senior Secured Credit Facilities. Our ability to borrow funds under our ABL Facilities is subject to, among other things, the financial viability of the participating financial institutions.
We currently believe we have adequate liquidity to fund operations during the near term through the generation of operating cash flows, cash on hand and access to our ABL Facilities. Our ability to borrow funds under our ABL Facilities is subject to, among other things, the financial viability of the participating financial institutions.
At December 31, 2024, the following components of our Senior Secured Credit Facilities bore interest at variable rates at specified margins above either the agent bank’s alternate base rate or Term SOFR: (i) a $900.0 million, seven-year term loan; and (ii) a $325.0 million, five-year asset-based revolving credit facility.
At December 31, 2025, the following components of our Senior Secured Credit Facilities bore interest at variable rates at specified margins above either the agent bank’s alternate base rate or Term SOFR: (i) a $777.5 million, seven-year term loan; and (ii) a $325.0 million, five-year asset-based revolving credit facility.
Based on the outstanding borrowings and impact of the interest rate swaps in place at December 31, 2024, a one percent change in the interest rate would result in a $3.7 million increase or decrease in our annual interest expense.
Based on the outstanding borrowings and impact of the interest rate swaps in place at December 31, 2025, a one percent change in the interest rate would result in a $3.8 million increase or decrease in our annual interest expense.
Under these swap agreements, we are required to make monthly fixed rate payments at annual rates ranging from 1.47% to 1.48% and the counterparties are obligated to make monthly floating rate payments to us based on one-month Term SOFR, each subject to a floor of 0.39%.
Under the amended October 2021 Agreements, expiring June 30, 2026, we are required to make monthly fixed rate payments at annual rates ranging from 1.47% to 1.48% and the counterparties are obligated to make monthly floating rate payments to us based on one-month Term SOFR, each subject to a floor of 0.39%.
Added
Please refer to Note 7 to our consolidated financial statements included within this Annual Report for more information on the interest rate swap agreements.
Added
Under the February 2025 Agreements, expiring June 26, 2029, we are required to make monthly fixed rate payments at annual rates ranging from 3.97% to 3.98% and the counterparties are required to make monthly floating rate payments to us based on one-month Term SOFR, each subject to a floor of 0.50%.