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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended
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Dec. 31, 2017
Accounting Policies [Abstract] |
Schedule of service fee revenue | Our service fee revenue, net of contractual allowances and discounts, the provision for bad debts, and revenue under capitation arrangements for the years ended December 31, are summarized in the following table (in thousands) :
|  | Years Ended December 31, |
|  | 2017 |  |  | 2016 |  |  | 2015 |
Commercial insurance |  | $ | 571,369 |  |  | $ | 539,793 |  |  | $ | 486,489 |
Medicare |  |  | 193,166 |  |  |  | 187,941 |  |  |  | 168,545 |
Medicaid |  |  | 25,821 |  |  |  | 28,170 |  |  |  | 23,948 |
Workers' compensation/personal injury |  |  | 35,195 |  |  |  | 36,548 |  |  |  | 32,728 |
Other (1) |  |  | 31,627 |  |  |  | 29,135 |  |  |  | 35,046 |
Service fee revenue, net of contractual allowances and discounts |  |  | 857,178 |  |  |  | 821,587 |  |  |  | 746,756 |
Provision for bad debts |  |  | (46,555 | ) |  |  | (45,387 | ) |  |  | (36,033 | )
Net service fee revenue |  |  | 810,623 |  |  |  | 776,200 |  |  |  | 710,723 |
Revenue under capitation arrangements |  |  | 111,563 |  |  |  | 108,335 |  |  |  | 98,905 |
Total net revenue |  | $ | 922,186 |  |  | $ | 884,535 |  |  | $ | 809,628 |
(1) Other consists of revenue from teleradiology services, consulting fees and software revenue
Schedule of fair value of derivatives | Below represents the fair value of our 2016 Caps and loss (gain) recognized:
For the twelve months ended December 31, 2017
Derivatives |  | Balance Sheet Location |  | Fair Value – Liabilities |
Interest rate contracts |  | Current and other non-current liabilities |  | $ | (595 | )
For the twelve months ended December 31, 2016
Derivatives |  | Balance Sheet Location |  |  | Fair Value – Asset Derivatives |
Interest rate contracts |  | Current assets |  | $ | 818 |
Schedule of effect of derivative instruments on comprehensive income | A tabular presentation of the effect of derivative instruments on our consolidated statement of comprehensive (loss) income, net of taxes is as follows (amounts in thousands):
For the twelve months ended December 31, 2017
Effective Interest Rate Cap | Amount of Loss Recognized on Derivative | Location of Loss Recognized in Income on Derivative
Interest rate contracts | ($880) | Other Comprehensive Loss
For the twelve months ended December 31, 2016
Effective Interest Rate Cap | Amount of Gain Recognized on Derivative | Location of Gain Recognized in Income on Derivative
Interest rate contracts | $508 | Other Comprehensive Income
Schedule of fair value of assets and liabilities | The table below summarizes the estimated fair values of certain of our financial assets that are subject to fair value measurements, and the classification of these assets in our consolidated balance sheets, as follows (in thousands):
|  | As of December 31, 2017 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Current and other non-current liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest Rate Contracts |  | $ | – |  |  | $ | (595 | ) |  | $ | – |  |  | $ | (595 | )
|  | As of December 31, 2016 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Current assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest Rate Contracts |  | $ | – |  |  | $ | 818 |  |  | $ | – |  |  | $ | 818 |
The table below summarizes the estimated fair value and carrying amount of our long-term debt as follows (in thousands):
|  | As of December 31, 2017 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total Fair Value |  |  | Total Face Value |
First Lien Term Loans |  | $ | – |  |  | $ | 628,801 |  |  | $ | – |  |  | $ | 628,801 |  |  | $ | 620,272 |
|  | As of December 31, 2016 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |  |  | Total Face Value |
First Lien Term Loans |  | $ | – |  |  | $ | 483,129 |  |  | $ | – |  |  | $ | 483,129 |  |  | $ | 478,938 |
Second Lien Term Loans |  | $ | – |  |  | $ | 167,580 |  |  | $ | – |  |  | $ | 167,580 |  |  | $ | 168,000 |
Schedule of earnings per share | Earnings per share is based upon the weighted average number of shares of common stock and common stock equivalents outstanding, net of common stock held in treasury, as follows (in thousands except share and per share data):
|  | Years Ended December 31, |
|  | 2017 |  |  | 2016 |  |  | 2015 |
Net income attributable to RadNet, Inc. common stockholders |  | $ | 53 |  |  | $ | 7,230 |  |  | $ | 7,709 |
BASIC NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS |  |  |  |  |  |  |  |  |  |  |  |
Weighted average number of common shares outstanding during the period |  |  | 46,880,775 |  |  |  | 46,244,188 |  |  |  | 43,805,794 |
Basic net income per share attributable to RadNet, Inc. common stockholders |  | $ | 0.00 |  |  | $ | 0.16 |  |  | $ | 0.18 |
DILUTED NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS |  |  |  |  |  |  |  |  |  |  |  |
Weighted average number of common shares outstanding during the period |  |  | 46,880,775 |  |  |  | 46,244,188 |  |  |  | 43,805,794 |
Add nonvested restricted stock subject only to service vesting |  |  | 274,940 |  |  |  | 220,416 |  |  |  | 865,326 |
Add additional shares issuable upon exercise of stock options and warrants |  |  | 246,206 |  |  |  | 190,428 |  |  |  | 500,252 |
Weighted average number of common shares used in calculating diluted net income per share |  |  | 47,401,921 |  |  |  | 46,655,032 |  |  |  | 45,171,372 |
Diluted net income per share attributable to RadNet, Inc. common stockholders |  | $ | 0.00 |  |  | $ | 0.15 |  |  | $ | 0.17 |
Stock options excluded from the computation of diluted per share amounts: |  |  |  |  |  |  |  |  |  |  |  |
Weighted average shares for which the exercise price exceeds average market price of common stock |  |  | 175,037 |  |  |  | 245,313 |  |  |  | 260,000 |
Schedule of investment in joint ventures | The following table is a summary of our investment in joint ventures during the years ended December 31, 2017 and December 31, 2016 (in thousands):
Balance as of December 31, 2015 |  | $ | 33,584 |
Equity contributions in existing and purchase of interest in joint ventures |  |  | 3,084 |
Equity in earnings in these joint ventures |  |  | 9,767 |
Distribution of earnings |  |  | (2,926 | )
Balance as of December 31, 2016 |  | $ | 43,509 |
Equity contributions in existing and purchase of interest in joint ventures |  |  | 4,062 |
Equity in earnings in these joint ventures |  |  | 13,554 |
Distribution of earnings |  |  | (8,690 | )
Balance as of December 31, 2017 |  | $ | 52,435 |
Schedule of Joint venture investment and financial information | The following table is a summary of key unaudited financial data for these joint ventures as of December 31, 2017 and 2016, respectively, and for the years ended December 31, 2017, 2016 and 2015, respectively, (in thousands):
|  | December 31, |
Balance Sheet Data: |  | 2017 |  |  | 2016 |
Current assets |  | $ | 47,813 |  |  | $ | 40,093 |
Noncurrent assets |  |  | 107,481 |  |  |  | 100,146 |
Current liabilities |  |  | (16,655 | ) |  |  | (14,077 | )
Noncurrent liabilities |  |  | (42,072 | ) |  |  | (44,405 | )
Total net assets |  | $ | 96,567 |  |  | $ | 81,757 |
Book value of RadNet joint venture interests |  | $ | 45,935 |  |  | $ | 38,539 |
Cost in excess of book value of acquired joint venture interests accounted for as equity method goodwill |  |  | 6,500 |  |  |  | 4,970 |
Total value of RadNet joint venture interests |  | $ | 52,435 |  |  | $ | 43,509 |
Total book value of other joint venture partner interests |  | $ | 50,632 |  |  | $ | 43,218 |
|  | 2017 |  |  | 2016 |  |  | 2015 |
Net revenue |  | $ | 188,849 |  |  | $ | 160,134 |  |  | $ | 125,544 |
Net income |  | $ | 28,644 |  |  | $ | 21,933 |  |  | $ | 19,485 |

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