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Investments in Other Entities - Equity Method | 3 Months Ended
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Mar. 31, 2020
Equity Method Investments and Joint Ventures [Abstract] |
Investments in Other Entities - Equity Method | Investments in Other Entities — Equity Method Rollforward of Equity Method Investment (in thousands)
| December 31, 2019 | Allocation of Income (Loss) | Contribution | March 31, 2020
LaSalle Medical Associates – IPA Line of Business | $ | 6,397 |  | $ | (643 | ) | $ | — |  | $ | 5,754 |
Pacific Medical Imaging & Oncology Center, Inc. | 1,396 |  | 87 |  | — |  | 1,483 |
Universal Care, Inc. | 1,438 |  | 2,670 |  | — |  | 4,108 |
Diagnostic Medical Group | 2,334 |  | (5 | ) | — |  | 2,329 |
531 W. College, LLC – related party | 16,698 |  | (111 | ) | 300 |  | 16,887 |
MWN, LLC – related party | 164 |  | 56 |  | — |  | 220 |
| $ | 28,427 |  | $ | 2,054 |  | $ | 300 |  | $ | 30,781 |
LaSalle Medical Associates — IPA Line of Business LMA was founded by Dr. Albert Arteaga in 1996 and currently operates six neighborhood medical centers through its network of more than 2,300 PCP and Specialists providers, treating children, adults and seniors in San Bernardino County, California. LMA’s patients are primarily served by Medi-Cal and they also accept Blue Cross, Blue Shield, Molina, Care 1st, Health Net and Inland Empire Health Plan. LMA is also an IPA of independently contracted doctors, hospitals and clinics, delivering high-quality care to more than 295,000 patients in Fresno, Kings, Los Angeles, Madera, Riverside, San Bernardino and Tulare Counties. During 2012, APC-LSMA and LMA entered into a share purchase agreement whereby APC-LSMA invested $5.0 million for a 25% interest in LMA’s IPA line of business. NMM has a management services agreement with LMA. APC accounts for its investment in LMA under the equity method as APC has the ability to exercise significant influence, but not control over LMA’s operations. For the three months ended March 31, 2020 and 2019, APC recorded losses from this investment of $0.6 million and $1.1 million, respectively, in the accompanying consolidated statements of income. The accompanying consolidated balance sheets include the related investment balance of $5.8 million and $6.4 million at March 31, 2020 and December 31, 2019, respectively. LMA’s summarized balance sheets at March 31, 2020 and December 31, 2019 and summarized statements of operations for the three months ended March 31, 2020 and 2019 with respect to its IPA line of business are as follows (in thousands): Balance Sheets
| March 31, 2020 |  | December 31, 2019
Assets |  |  |
Cash and cash equivalents | $ | — |  |  | $ | 6,345 |
Receivables, net | 8,901 |  |  | 5,124 |
Other current assets | 3,380 |  |  | 3,526 |
Loan receivable | 2,250 |  |  | 2,250 |
Restricted cash | 686 |  |  | 683 |
Total assets | $ | 15,217 |  |  | $ | 17,928 |
Liabilities and Stockholders’ (Deficit) Equity |  |  |
Current liabilities | $ | 23,390 |  |  | $ | 23,530 |
Stockholders’ deficit | (8,173 | ) |  | (5,602 | )
Total liabilities and stockholders’ deficit | $ | 15,217 |  |  | $ | 17,928 |
Statements of Operations
| Three Months Ended March 31,
| 2020 |  | 2019
Revenues | $ | 46,304 |  |  | $ | 46,406 |
Expenses | 48,730 |  |  | 50,702 |
Net loss | $ | (2,426 | ) |  | $ | (4,296 | )
Pacific Medical Imaging and Oncology Center, Inc. Incorporated in California in 2004, PMIOC provides comprehensive diagnostic imaging services using state-of-the-art technology. PMIOC offers high-quality diagnostic services, such as MRI/MRA, PET/CT, CT, nuclear medicine, ultrasound, digital x-rays, bone densitometry and digital mammography, at its facilities. In July 2015, APC-LSMA and PMIOC entered into a share purchase agreement whereby APC-LSMA invested $1.2 million for a 40% ownership interest in PMIOC. APC and PMIOC have an Ancillary Service Contract together whereby PMIOC provides covered services on behalf of APC to enrollees of the plans of APC. Under the Ancillary Service Contract, APC paid PMIOC fees of approximately $0.6 million and $0.7 million, for the three months ended March 31, 2020 and 2019, respectively. APC accounts for its investment in PMIOC under the equity method of accounting as APC has the ability to exercise significant influence, but not control over PMIOC’s operations. During the three months ended March 31, 2020 and 2019, APC recorded income from this investment of approximately $0.1 million and $0.1 million, respectively, in the accompanying consolidated statements of income and has investment balances of $1.5 million and $1.4 million at March 31, 2020 and December 31, 2019, respectively. Universal Care, Inc. UCI is a privately held health plan that has been in operation since 1985. UCI holds a license under the California Knox-Keene Health Care Services Plan Act to operate as a full-service health plan. UCI contracts with CMS under the Medicare Advantage Prescription Drug Program. On August 10, 2015, UCAP purchased 100,000 shares of UCI class A-2 voting common stock from UCI for $10.0 million, which shares comprise 48.9% of UCI's total outstanding shares and 50% of UCI’s voting common stock. APC accounts for its investment in UCI under the equity method of accounting as APC has the ability to exercise significant influence, but not control over UCI’s operations. During the three months ended March 31, 2020 and 2019, the Company recorded income from this investment of approximately $2.7 million and $1.0 million, respectively, in the accompanying consolidated statements of income and had investment balances of $4.1 million and $1.4 million at March 31, 2020 and December 31, 2019, respectively. On April 30, 2020, UCAP completed its disposition of its 48.9% ownership interest in UCI to Bright for approximately $69.2 million in cash proceeds (including $16.5 million as repayment of indebtedness owed to APC), plus non-cash consideration consisting of shares of Bright Health, Inc.’s preferred stock having a stipulated value of approximately $33.3 million. In addition, pursuant to the terms of the SPA, upon release from escrow, APC is entitled to receive all or that portion of the following escrowed amounts that have not been offset or reserved for claims: (i) cash consideration of approximately $15.6 million, plus (ii) non-cash consideration consisting of shares of Bright Health, Inc.’s preferred stock having a stipulated value of approximately $5.9 million (see Note 17). UCI’s balance sheets at March 31, 2020 and December 31, 2019 and statements of income for the three months ended March 31, 2020 and 2019 are as follows (in thousands): Balance Sheets
| March 31, 2020 |  | December 31, 2019
Assets |  |  |
Cash | $ | 34,757 |  |  | $ | 33,890 |
Receivables, net | 83,454 |  |  | 63,843 |
Other current assets | 43,417 |  |  | 38,280 |
Other assets | 885 |  |  | 882 |
Property and equipment, net | 4,429 |  |  | 4,021 |
Total assets | $ | 166,942 |  |  | $ | 140,916 |
Liabilities and Stockholders’ (Deficit) Equity |  |  |
Current liabilities | $ | 148,902 |  |  | $ | 128,330 |
Other liabilities | 33,126 |  |  | 33,133 |
Stockholders’ deficit | (15,086 | ) |  | (20,547 | )
Total liabilities and stockholders’ deficit | $ | 166,942 |  |  | $ | 140,916 |
Statements of Income
| Three Months Ended March 31,
| 2020 |  | 2019
Revenues | $ | 146,481 |  |  | $ | 113,319 |
Expenses | 141,771 |  |  | 111,408 |
Income before benefit from income taxes | 4,710 |  |  | 1,911 |
Benefit from income taxes | — |  |  | (211 | )
Net income | $ | 4,710 |  |  | $ | 2,122 |
Diagnostic Medical Group In May 2016, David C.P. Chen M.D., individually, and APC-LSMA, entered into a share purchase agreement whereby APC-LSMA acquired a 40% ownership interest in DMG. APC accounts for its investment in DMG under the equity method of accounting as APC has the ability to exercise significant influence, but not control over DMG’s operations. For the three months ended March 31, 2020 and 2019, APC recorded losses and income from this investment of $5,244 and $0.2 million, respectively, in the consolidated statements of income. The accompanying consolidated balance sheets include the related investment balances of $2.3 million as of March 31, 2020 and December 31, 2019, respectively. 531 W. College LLC – Related Party In June 2018, College Street Investment LP, a California limited partnership (“CSI”), APC and NMM entered into an operating agreement to govern the limited liability company, 531 W. College, LLC and the conduct of its business, and to specify their relative rights and obligations. CSI, APC and NMM, each owns 50%, 25% and 25%, respectively, of member units based on initial capital contributions of $16.7 million, $8.3 million, and $8.3 million, respectively. On June 29, 2018, 531 W. College, LLC closed its purchase of a non-operational hospital located in Los Angeles from Societe Francaise De Bienfaisance Mutuelle De Los Angeles, a California nonprofit corporation, for a total purchase price of $33.3 million. On April 23, 2019, NMM and APC entered into an agreement whereby NMM assigned and APC assumed NMM's 25% membership interest in 531 W. College, LLC for approximately $8.3 million. Subsequently, APC has a 50% ownership in 531 W. College LLC with a total investment balance of approximately $16.9 million. APC accounts for its investment in 531 W. College, LLC under the equity method of accounting as APC has the ability to exercise significant influence, but not control over the operations of this joint venture. For the three months ended March 31, 2020 and March 31, 2019, APC recorded losses of $0.1 million and $46,968, respectively, in the accompanying consolidated statements of income. During the period ended March 31, 2020, the Company contributed $0.3 million to 531 W. College LLC as part of its 50% interest and had investment balances of $16.9 million and $16.7 million, respectively, at March 31, 2020 and December 31, 2019. 531 W. College LLC’s balance sheets at March 31, 2020 and December 31, 2019 and statements of operations for the three months ended March 31, 2020 and 2019 are as follows (in thousands): Balance Sheets
| March 31, 2020 |  | December 31, 2019
Assets |  |  |
Cash | $ | 48 |  |  | $ | 139 |
Other current assets | 124 |  |  | 17 |
Other assets | 70 |  |  | 70 |
Property and equipment, net | 33,697 |  |  | 33,581 |
Total assets | $ | 33,939 |  |  | $ | 33,807 |
Liabilities and Members’ Equity |  |  |
Current liabilities | $ | 1,114 |  |  | $ | 1,062 |
Stockholders’ equity | 32,825 |  |  | 32,745 |
Total liabilities and members’ equity | $ | 33,939 |  |  | $ | 33,807 |
Statements of Operation
| Three Months Ended March 31,
| 2020 |  | 2019
Revenues | — |  |  | — |
Expenses | 338 |  |  | 469 |
Loss from operations | (338 | ) |  | (469 | )
Other income | $ | 21 |  |  | $ | 289 |
Net loss | $ | (317 | ) |  | $ | (180 | )
MWN LLC – Related Party On December 18, 2018, NMM, 6 Founders LLC, a California limited liability company doing business as Pacific6 Enterprises (“Pacific6”), and Health Source MSO Inc., a California corporation (“HSMSO”) entered into an operating agreement to govern MWN Community Hospital, LLC and the conduct of its business and to specify their relative rights and obligations. NMM, Pacific6, and HSMSO each own 33.3% of the membership shares based on each member’s initial capital contributions of $3,000 and working capital contributions of $30,000. NMM invested an additional $0.3 million for working capital purposes in August, 2019. For the three months ended March 31, 2020, NMM recorded income from its investment in MWN LLC of $0.1 million in the accompanying consolidated statements of income and had an investment balance of $0.2 million as of March 31, 2020 and December 31, 2019. Investment in privately held entity that does not report net asset value per share MediPortal, LLC In May 2018, APC purchased 270,000 membership interests of MediPortal LLC, a New York limited liability company, for $0.4 million or $1.50 per membership interest, which represented an approximately 2.8% ownership interest. In connection with the initial purchase, APC received a five-year warrant to purchase an additional 270,000 membership interests. Additionally, APC received a five-year option to purchase an additional 380,000 membership interests and a five-year warrant to purchase 480,000 membership interests, which MediPortal LLC will grant APC upon completion of its health portal. As of March 31, 2020, the health portal has not been completed. As APC does not have the ability to exercise significant influence, and lacks control, over the investee, this investment is accounted for using a measurement alternative which allows the investment to be measured at cost, adjusted for observable price changes and impairments, with changes recognized in net income. AchievaMed On July 1, 2019, NMM and AchievaMed, Inc., a California corporation ("AchievaMed"), entered into an agreement in which NMM would purchase 50% of the aggregate shares of capital stock of AchievaMed over a period of time not to exceed five years. As a result of this transaction NMM invested $0.5 million for a 10% interest. The related investment balance of $0.5 million is included in "Investment in privately held entities" in the accompanying consolidated balance sheets as of March 31, 2020.

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