Leases

9 Months Ended

Sep. 30, 2023

The Company's operating leases are primarily for real estate, including medical office buildings, and corporate and other administrative offices. The Company's finance leases are primarily for medical equipment and information technology and telecommunications assets.

The following table presents the components of the Company's right-of-use assets and liabilities related to leases and their classification in the consolidated balance sheets (in millions):


	Classification in Consolidated Balance Sheets	September 30, 2023		December 31, 2022

Assets:
Operating lease assets	Right-of-use operating lease assets	$	244.5	$	279.1
Finance lease assets	Property and equipment, net of accumulated depreciation	571.8		529.6
Total leased assets		$	816.3	$	808.7

Liabilities:
Operating lease liabilities:
Current	Other current liabilities	$	35.7	$	36.5
Long-term	Right-of-use operating lease liabilities	240.9		271.4
Total operating lease liabilities		276.6		307.9
Finance lease liabilities:
Current	Current maturities of long-term debt	24.7		20.9
Long-term	Long-term debt, less current maturities	616.5		564.8
Total finance lease liabilities		641.2		585.7
Total lease liabilities		$	917.8	$	893.6

During the nine months ended September 30, 2023, the Company extended certain existing facility real estate leases, resulting in the reclassification of the leases from operating to finance. The modifications resulted in an increase to finance lease liabilities and assets of $97.1 million and $95.7 million, respectively, including the reclassification of existing operating lease liabilities and assets of $38.4 million and $36.9 million, respectively.

The following table presents the components of the Company's lease expense included in the condensed consolidated statement of operations (in millions):


	Nine Months Ended September 30,
	2023		2022
Operating lease costs	$	48.7	$	49.5
Finance lease costs:
Amortization of leased assets	29.0		28.2
Interest on lease liabilities	35.9		30.6
Total finance lease costs	64.9		58.8
Variable and short-term lease costs	16.3		13.7
Total lease costs	$	129.9	$	122.0

The following table presents supplemental cash flow information (dollars in millions):


	Nine Months Ended September 30,
	2023		2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows from operating leases	$	47.2	$	47.9
Operating cash outflows from finance leases	$	34.1	$	30.2
Financing cash outflows from finance leases	$	19.3	$	18.1

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	39.9	$	45.3
Finance leases	$	108.7	$	172.5

Leases

The following table presents the components of the Company's right-of-use assets and liabilities related to leases and their classification in the consolidated balance sheets (in millions):


	Classification in Consolidated Balance Sheets	September 30, 2023		December 31, 2022

Assets:
Operating lease assets	Right-of-use operating lease assets	$	244.5	$	279.1
Finance lease assets	Property and equipment, net of accumulated depreciation	571.8		529.6
Total leased assets		$	816.3	$	808.7

Liabilities:
Operating lease liabilities:
Current	Other current liabilities	$	35.7	$	36.5
Long-term	Right-of-use operating lease liabilities	240.9		271.4
Total operating lease liabilities		276.6		307.9
Finance lease liabilities:
Current	Current maturities of long-term debt	24.7		20.9
Long-term	Long-term debt, less current maturities	616.5		564.8
Total finance lease liabilities		641.2		585.7
Total lease liabilities		$	917.8	$	893.6

The following table presents the components of the Company's lease expense included in the condensed consolidated statement of operations (in millions):


	Nine Months Ended September 30,
	2023		2022
Operating lease costs	$	48.7	$	49.5
Finance lease costs:
Amortization of leased assets	29.0		28.2
Interest on lease liabilities	35.9		30.6
Total finance lease costs	64.9		58.8
Variable and short-term lease costs	16.3		13.7
Total lease costs	$	129.9	$	122.0

The following table presents supplemental cash flow information (dollars in millions):


	Nine Months Ended September 30,
	2023		2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows from operating leases	$	47.2	$	47.9
Operating cash outflows from finance leases	$	34.1	$	30.2
Financing cash outflows from finance leases	$	19.3	$	18.1

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	39.9	$	45.3
Finance leases	$	108.7	$	172.5