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Business Combinations (Tables)

9 Months Ended

Sep. 30, 2019

Business Combinations [Abstract]

Schedule of Assets Acquired and Liabilities Assumed at the Acquisition Date

The preliminary fair value of the assets acquired and liabilities assumed at the acquisition date were as follows (in millions):

Accounts receivable	$	10.2
Prepaid expenses and other current assets	1.7
Property and equipment, net	0.7
Identifiable intangible assets:
Noncompete agreements (useful lives of 5 years)	1.0
Trade name (useful life of 6 months)	1.0
Certificates of need (useful lives of 10 years)	34.3
Licenses (useful lives of 10 years)	14.6
Internal-use software (useful lives of 3 years)	0.1
Goodwill	163.9
Other long-term assets	5.0
Total assets acquired	232.5
Liabilities assumed:
Current portion of long-term debt	0.3
Accounts payable	1.2
Accrued payroll	8.1
Other current liabilities	2.3
Long-term operating lease liabilities	3.1
Total liabilities assumed	15.0
Net assets acquired	$	217.5

The fair value of the assets acquired at the acquisition date were as follows (in millions):

Identifiable intangible assets:
Noncompete agreement (useful lives of 2 years)	$	0.1
Trade name (useful life of 20 years)	0.4
Goodwill	4.8
Total assets acquired	5.3
Total liabilities assumed	0.2
Net assets acquired	$	5.1

The fair value of the assets acquired and liabilities assumed at the acquisition date were as follows (in millions):

Identifiable intangible assets:
Noncompete agreements (useful lives of 5 years)	$	0.2
Certificates of need (useful lives of 10 years)	2.0
License (useful life of 10 years)	0.8
Goodwill	10.8
Other assets acquired	0.2
Total assets acquired	14.0
Liabilities assumed:
Accrued payroll	0.1
Other current liabilities	0.1
Other long-term liabilities	0.1
Total liabilities assumed	0.3
Net assets acquired	$	13.7

Schedule of Noncash or Part Noncash Acquisitions

Information regarding the net cash paid for Alacare is as follows (in millions):

Fair value of assets acquired	$	68.6
Goodwill	163.9
Fair value of liabilities assumed	(15.0		)
Net cash paid for acquisition	$	217.5

Information regarding the net cash paid for the inpatient rehabilitation acquisitions during each period presented is as follows (in millions):

	Three Months Ended September 30,								Nine Months Ended September 30,
	2019				2018				2019				2018
Fair value of assets acquired	$	0.5			$	9.7			$	0.5			$	9.7
Goodwill	4.8				6.4				4.8				6.4
Fair value of liabilities assumed	(0.2		)		—				(0.2		)		—
Fair value of noncontrolling interest owned by joint venture partner	(5.1		)		(16.1		)		(5.1		)		(16.1		)
Net cash paid for acquisitions	$	—			$	—			$	—			$	—

Information regarding the net cash paid for the other home health and hospice acquisitions during each period presented is as follows (in millions):

	Three Months Ended September 30,								Nine Months Ended September 30,
	2019				2018				2019				2018
Fair value of assets acquired	$	—			$	41.0			$	3.2			$	42.0
Goodwill	—				97.0				10.8				102.1
Fair value of liabilities assumed	—				(8.3		)		(0.3		)		(8.3		)
Net cash paid for acquisitions	$	—			$	129.7			$	13.7			$	135.8

Summary of Actual and Pro Forma Results of Operations for Acquisitions

The following table summarizes the results of operations of the above mentioned acquisitions from their respective dates of acquisition included in our consolidated results of operations and the unaudited pro forma results of operations of the combined entity had the date of the acquisitions been January 1, 2018 (in millions):

	Net Operating Revenues				Net Income Attributable to Encompass Health
Acquired entities only: Actual from acquisition date to September 30, 2019
Inpatient Rehabilitation	$	1.2			$	(1.0	)
Alacare	30.3				1.7
Other Home Health and Hospice	4.8				0.9
Combined entity: Supplemental pro forma from 07/01/2019-09/30/2019	1,162.6				97.6
Combined entity: Supplemental pro forma from 07/01/2018-09/30/2018	1,102.7				91.4
Combined entity: Supplemental pro forma from 01/01/2019-09/30/2019	3,490.3				296.7
Combined entity: Supplemental pro forma from 01/01/2018-09/30/2018	3,284.2				270.4

X

- Definition

Tabular disclosure of pro forma results of operations for a material business acquisition or series of individually immaterial business acquisitions that are material in the aggregate.

+ References

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-Publisher FASB
-Name Accounting Standards Codification
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Tabular disclosure of acquisition of assets or a business through noncash (or part noncash) transactions. Noncash is defined as information about all investing and financing activities of an enterprise during a period that affect recognized assets or liabilities but that do not result in cash receipts or cash payments in the period. "Part noncash" refers to that portion of the transaction not resulting in cash receipts or cash payments in the period. Disclosure may include the equity interest acquired, value of assets acquired, value of liabilities acquired, net monetary assets acquired, number of shares, warrants or options issued as consideration for a business or asset acquired and other information necessary to a fair presentation.

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Tabular disclosure of the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed. May include but not limited to the following: (a) acquired receivables; (b) contingencies recognized at the acquisition date; and (c) the fair value of noncontrolling interests in the acquiree.

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