Select Medical Holdings Corp. Files 2023 Annual Report on Form 10-K

TL;DR

<b>Select Medical Holdings Corp. has filed its 2023 10-K annual report, detailing its financial performance and operations for the fiscal year ending December 31, 2023.</b>

AI Summary

SELECT MEDICAL HOLDINGS CORP (SEM) filed a Annual Report (10-K) with the SEC on February 22, 2024. Select Medical Holdings Corp. filed its annual report for the fiscal year ending December 31, 2023. The filing is a 10-K report, providing a comprehensive overview of the company's financial performance and condition. The company's fiscal year concluded on December 31, 2023. The filing was submitted on February 22, 2024. Select Medical Holdings Corp. is classified under the Services-Hospitals industry (SIC code 8060).

Why It Matters

For investors and stakeholders tracking SELECT MEDICAL HOLDINGS CORP, this filing contains several important signals. This 10-K filing provides investors and stakeholders with crucial insights into Select Medical's financial health, operational strategies, and risk factors for the past fiscal year. Understanding the details within this report is essential for evaluating the company's performance, future prospects, and investment potential in the healthcare services sector.

Risk Assessment

Risk Level: medium — SELECT MEDICAL HOLDINGS CORP shows moderate risk based on this filing. The company operates in the healthcare sector, which is subject to significant regulatory changes and reimbursement risks that could impact financial performance.

Analyst Insight

Review the detailed financial statements and risk factors in the 10-K to assess the company's operational performance and potential challenges in the healthcare industry.

Key Numbers

• 2023-12-31 — Fiscal Year End (Reported period)
• 2024-02-22 — Filing Date (Date of submission)
• 001-34465 — SEC File Number (SEC filing identifier)
• 0001320414 — Central Index Key (Company identifier)

Key Players & Entities

• SELECT MEDICAL HOLDINGS CORP (company) — Filer name
• 20231231 (date) — Fiscal year end
• 20240222 (date) — Filing date
• 0001320414 (company) — Central Index Key
• 8060 (industry) — Standard Industrial Classification
• MECHANICSBURG (location) — Business and mailing address city
• PA (location) — Business and mailing address state
• 17055 (location) — Business and mailing address zip

FAQ

Risk Factors

• Regulatory Environment [high — regulatory]: The company is subject to extensive federal and state regulations governing healthcare providers, including Medicare and Medicaid reimbursement, which can change and impact financial results.
• Reimbursement Risks [high — financial]: Changes in reimbursement rates or policies from government payers (Medicare, Medicaid) and private insurers could adversely affect revenue and profitability.
• Operational Challenges [medium — operational]: The company faces risks related to the integration of acquired facilities, staffing shortages, and the ability to maintain quality of care across its diverse service lines.
• Competition [medium — market]: The healthcare industry is competitive, with potential for new entrants and existing competitors to impact market share and pricing power.

Key Dates

• 2024-02-22: 10-K Filing — Annual report submission date for fiscal year 2023.
• 2023-12-31: Fiscal Year End — End date of the reporting period.

Key Financial Figures

• $0.001 — ange on Which Registered Common Stock, $0.001 par value per share SEM New York Stock
• $31.86 — r share of common stock on that date of $31.86 as reported on the New York Stock Excha
• $6,664.1 million — ur Concentra segment. We had revenue of $6,664.1 million for the year ended December 31, 2023. O

Filing Documents

• sem-20231231.htm (10-K) — 2980KB
• sem-1231202310kex1072.htm (EX-10.72) — 40KB
• sem-1231202310kex211.htm (EX-21.1) — 255KB
• sem-1231202310kex23.htm (EX-23) — 3KB
• sem-1231202310kex311.htm (EX-31.1) — 13KB
• sem-1231202310kex312.htm (EX-31.2) — 13KB
• sem-1231202310kex321.htm (EX-32.1) — 8KB
• sem-1231202310kex97.htm (EX-97) — 45KB
• sem-20231231_g1.jpg (GRAPHIC) — 93KB
• 0001628280-24-006385.txt (&nbsp;) — 14440KB
• sem-20231231.xsd (EX-101.SCH) — 92KB
• sem-20231231_cal.xml (EX-101.CAL) — 156KB
• sem-20231231_def.xml (EX-101.DEF) — 381KB
• sem-20231231_lab.xml (EX-101.LAB) — 1106KB
• sem-20231231_pre.xml (EX-101.PRE) — 732KB
• sem-20231231_htm.xml (XML) — 2334KB

Forward-Looking Statements

Forward-Looking Statements 1 Item 1. Business. 3 Item 1A. Risk Factors. 34 Item 1B. Unresolved Staff Comments. 47 Item 1C. Cybersecurity. 45 Item 2. Properties. 50 Item 3. Legal Proceedings. 51 Item 4. Mine Safety Disclosures. 52 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. 53 Item 6. [Reserved] 56 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations. 57 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk. 78 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data. 78 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure. 78 Item 9A.

Controls and Procedures

Controls and Procedures. 78 Item 9B. Other Information. 79 PART III Item 10. Directors, Executive Officers and Corporate Governance. 80 Item 11.

Executive Compensation

Executive Compensation. 80 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. 80 Item 13. Certain Relationships, Related Transactions and Director Independence. 80 Item 14. Principal Accountant Fees and Services 80 PART IV Item 15. Exhibits and Financial Statement Schedules. 81 Item 16. Form 10-K Summary. 86

Signatures

Signatures 87 Table of Contents PART I

Forward-Looking Statements

Forward-Looking Statements This annual report on Form 10-K contains forward-looking statements within the meaning of the federal securities laws. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements preceded by, followed by or that include the words "may," "could," "would," "should," "believe," "expect," "anticipate," "plan," "target," "estimate," "project," "intend," and similar expressions. These statements include, among others, statements regarding our expected business outlook, anticipated financial and operating results, including the continued impact of the effects of the coronavirus disease 2019 ("COVID-19") pandemic on those financial and operating results, our business strategy and means to implement our strategy, our objectives, the amount and timing of capital expenditures, the likelihood of our success in expanding our business, financing plans, budgets, working capital needs, and sources of liquidity. Forward-looking statements are only predictions and are not guarantees of performance. These statements are based on our management's beliefs and assumptions, which in turn are based on currently available information. Important assumptions relating to the forward-looking statements include, among others, assumptions regarding our services, the expansion of our services, competitive conditions, and general economic conditions. These assumptions could prove inaccurate. Forward-looking statements also involve known and unknown risks and uncertainties, which could cause actual results to differ materially from those contained in any forward-looking statement. Many of these factors are beyond our ability to control or predict. Such factors include, but are not limited to, the following: changes in government reimbursement for our services and/or new payment policies may result in a reduction in revenue, an increase in costs, and a red

Business

Item 1. Business. Overview We began operations in 1997 and, based on the number of facilities, are one of the largest operators of critical illness recovery hospitals, rehabilitation hospitals, outpatient rehabilitation clinics, and occupational health centers in the United States. As of December 31, 2023, we had operations in 46 states and the District of Columbia. As of December 31, 2023, we operated 107 critical illness recovery hospitals in 28 states, 33 rehabilitation hospitals in 13 states, 1,933 outpatient rehabilitation clinics in 39 states and the District of Columbia, 544 occupational health centers in 41 states, and 150 onsite clinics at employer worksites. We manage our Company through four business segments: our critical illness recovery hospital segment, our rehabilitation hospital segment, our outpatient rehabilitation segment, and our Concentra segment. We had revenue of $6,664.1 million for the year ended December 31, 2023. Of this total, we earned approximately 35% of our revenue from our critical illness recovery hospital segment, approximately 15% from our rehabilitation hospital segment, approximately 18% from our outpatient rehabilitation segment, and approximately 28% from our Concentra segment. We also recognized other revenue associated with employee leasing services provided to the Company's non-consolidating subsidiaries. Our critical illness recovery hospital segment consists of hospitals designed to serve the needs of patients recovering from critical illnesses, often with complex medical needs, and our rehabilitation hospital segment consists of hospitals designed to serve patients that require intensive physical rehabilitation care. Patients are typically admitted to our critical illness recovery hospitals and rehabilitation hospitals from general acute care hospitals. Our outpatient rehabilitation segment consists of clinics that provide physical, occupational, and speech rehabilitation services. Our Concentra segment consists of

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