CareMax Inc.

08/09/2024 | Press release | Distributed by Public on 08/09/2024 15:36

CareMax Reports Second Quarter 2024 Results

  • Second Quarter Medicare Advantage Membership of 104,000, up 1% year-over-year
  • Second Quarter Total Revenue of $198.6 million, down 12% year-over-year

MIAMI--(BUSINESS WIRE)-- CareMax, Inc. (NASDAQ: CMAX; CMAXW) ("CareMax" or the "Company"), a leading technology-enabled value-based care delivery system, today announced financial results for the second quarter ended June 30, 2024.

"Although our medical expense ratio continued to run higher than target levels, we were able to manage toward another quarter of sequential improvement in MER in the second quarter, and we continued to make progress against our clinical initiatives," said Carlos de Solo, Chief Executive Officer.

Mr. de Solo continued, "Additionally, in July, we entered an agreement to access additional capital from our lenders and further extend the limited waiver of certain financial covenants in our credit facility. This funding will assist in bridging our liquidity as we continue to evaluate strategic alternatives for our business."

Second Quarter 2024 Results

  • Total membership of 236,500, down 13% year-over-year.
  • Medicare Advantage membership of 104,000, up 1% year-over-year.
  • Total revenue was $198.6 million, down 12% year-over-year.
  • Net loss was $170.6 million, which included a $2.4 million non-cash gain on remeasurement of derivative liabilities and $133.0 million of non-cash impairment of long-lived assets, compared to net loss of $32.4 million for the second quarter of 2023, which included a non-cash loss on remeasurement of contingent earnout liabilities of $16.2 million.
  • Adjusted EBITDA was ($11.2) million, compared to adjusted EBITDA of $7.0 million for the second quarter of 2023. 1
  • Platform Contribution was $3.7 million, compared to $28.6 million for the second quarter of 2023. 1
  • Medical Expense Ratio was 86.2%, compared to 84.6% for the second quarter of 2023.
  • De novo pre-opening costs and post-opening losses for the second quarter of 2024 were $4.6 million. 2

1 Adjusted EBITDA and Platform Contribution are non-GAAP financial metrics. A reconciliation of non-GAAP metrics to the most directly comparable GAAP financial measures is included in the appendix to this earnings release.

2 De novo pre-opening costs represent (1) incremental payroll costs from employees specifically associated with the operational, contractual, physical, or regulatory infrastructure for de novo centers, prior to their opening; (2) legal costs directly associated with the de novo centers, incurred prior to their opening, which includes services such as execution of leases, health plan contracts and other agreements; (3) other expenses related to diligence, design, permitting, and other "soft costs" at new sites; and (4) rent and facility expenses prior to center opening. De novo post-opening losses include center-level operating losses recognized at a de novo center until the center breaks even, which consist of revenue, external provider costs and cost of care allocated to the de novo center.

About CareMax

Founded in 2011, CareMax is a value-based care delivery system that utilizes a proprietary technology-enabled platform and multi-specialty, whole person health model to deliver comprehensive, preventative and coordinated care for its members. With approximately 200,000 Medicare Value-Based Care Members across 10 states, and fully integrated, Five-Star Quality rated health and wellness centers, CareMax is redefining healthcare across the country by reducing costs, improving overall outcomes and promoting health equity for seniors. Learn more at www.caremax.com .

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements include statements regarding our future strategy, future transactions and future financial performance. Words such as "anticipate," "believe," "budget," "contemplate," "continue," "could," "envision," "estimate," "expect," "guidance," "indicate," "intend," "may," "might," "plan," "possibly," "potential," "predict," "probably," "pro forma," "project," "seek," "should," "target," or "will," or the negative or other variations thereof, and similar words or phrases or comparable terminology, are intended to identify forward-looking statements. These forward-looking statements reflect the Company's expectations, plans or forecasts of future events and views as of the date of this press release. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the Company's control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements.

Important risks and uncertainties that could cause the Company's actual results and financial condition to differ materially from those indicated in forward-looking statements include, among others, the Company's net losses, level of indebtedness and significant cash used in operating activities have raised substantial doubt regarding its ability to continue as a going concern; the Company's future capital requirements and sources and uses of cash, including funds to satisfy its liquidity needs and the Company's ability to comply with the covenants under the agreements governing its indebtedness; the Company's ability to successfully execute its strategy, which may include divesting certain assets or businesses; the Company's ability to successfully implement cost-saving measures or achieve expected benefits under its plans to optimize performance of the MSO network and its centers; the possibility of the Company filing for a restructuring under Chapter 11 of the US Bankruptcy Code if the Company is unable to successfully implement its plans; the possibility that the Company's rights under certain existing agreements could be impaired as a result of bankruptcy proceedings brought by Steward Health Care System; the impact of restrictions on the Company's current and future operations contained in certain of its agreements; risks relating to lease termination, lease expense escalators, lease extensions, special charges and the Company's inability to comply with provisions of its lease agreements; the Company's ability to integrate acquired businesses and realize expected benefits of any such transactions; the Company's ability to attract new patients; changes in market or industry conditions, regulatory environment, competitive conditions, and receptivity to the Company's services; changes in laws and regulations applicable to the Company's business, in particular with respect to Medicare Advantage and Medicaid; the Company's ability to maintain its relationships with health plans and other key payers; any delay, modification or cancellation of government contracts; the impact of COVID-19 or any variant thereof or any other pandemic or epidemic on the Company's business and results of operation; insolvency, credit problems or other financial difficulties that could confront the Company's counterparties in strategic acquisitions, investments and other collaborations could expose the Company to significant financial risk and significantly impact the Company's ability to expand its overall profitability; the Company's ability to address the material weakness in its internal control over financial reporting; the Company's ability to recruit and retain qualified team members and independent physicians; risks related to future acquisitions; the Company's ability to develop and maintain proper and effective internal control over financial reporting and the impact of any prior period developments. For a detailed discussion of the risk factors that could affect the Company's actual results, please refer to the risk factors identified in the Company's reports filed with the SEC. All information provided in this press release is as of the date hereof, and the Company undertakes no duty to update or revise this information unless required by law, and forward-looking statements should not be relied upon as representing the Company's assessments as of any date subsequent to the date of this press release.

Use of Non-GAAP Financial Information

Certain financial information and data contained in this press release is unaudited and does not conform to Regulation S-X. Accordingly, such information and data may not be included in, may be adjusted in, or may be presented differently in, any periodic filing, information or proxy statement, or prospectus or registration statement to be filed by the Company with the SEC. Some of the financial information and data contained in this press release, such as Adjusted EBITDA and Platform Contribution and margin thereof have not been prepared in accordance with United States generally accepted accounting principles ("GAAP"). These non-GAAP measures of financial results are not GAAP measures of our financial results or liquidity and should not be considered as an alternative to net income (loss) as a measure of financial results, cash flows from operating activities as a measure of liquidity, or any other performance measure derived in accordance with GAAP. The Company believes these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to the Company's financial condition and results of operations. The Company's management uses these non-GAAP measures for trend analyses and for budgeting and planning purposes.

The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating projected operating results and trends in and in comparing the Company's financial measures with other similar companies, many of which present similar non-GAAP financial measures to investors. Management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. For this reason, these non-GAAP measures may not be comparable to other companies' similarly labeled non-GAAP financial measures. In order to compensate for these limitations, management presents non-GAAP financial measures in connection with GAAP results.

A reconciliation for Adjusted EBITDA and Platform Contribution to the most directly comparable GAAP financial measures is included below.

CAREMAX, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

(Unaudited)

June 30,
2024

December 31,
2023

ASSETS

Current Assets

Cash and cash equivalents

$

16,430

$

65,528

Accounts receivable, net

97,488

114,754

Other current assets

9,547

3,066

Total Current Assets

123,466

183,348

Property and equipment, net

21,419

47,918

Operating lease right-of-use assets

48,424

109,215

Goodwill, net

156,841

156,841

Intangible assets, net

42,163

101,243

Other assets

61,730

24,737

Total Assets

$

454,043

$

623,301

LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY

Current Liabilities

Accounts payable

$

8,453

$

6,275

Accrued expenses

13,257

16,224

Risk settlement liabilities

59,204

42,602

Related party liabilities

1,772

190

Current portion of third-party debt, net

403,321

364,380

Current portion of operating lease liabilities

43,646

8,975

Other current liabilities

17

165

Total Current Liabilities

529,671

438,812

Derivative liabilities

48

22

Long-term debt, net

1,785

21,443

Long-term operating lease liabilities

64,455

97,136

Other liabilities

5,844

4,443

Total Liabilities

601,803

561,856

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' (DEFICIT) EQUITY

Preferred stock (1,000,000 shares authorized; one share issued and outstanding as of June 30, 2024 and December 31, 2023)

-

-

Class A common stock ($0.0001 par value; 8,333,333 shares authorized; 3,814,871 and 3,744,732 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively)

11

11

Additional paid-in-capital

787,132

782,371

Accumulated deficit

(934,902

)

(720,938

)

Total Stockholders' (Deficit) Equity

(147,759

)

61,444

Total Liabilities and Stockholders' (Deficit) Equity

$

454,043

$

623,301

CAREMAX, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

(Unaudited)

Three Months Ended June 30,

Six Months Ended June 30,

2024

2023

2024

2023

Revenue

Medicare risk-based revenue

$

154,857

$

155,486

$

323,359

$

277,079

Medicaid risk-based revenue

22,865

30,054

60,518

55,680

Government value-based care revenue

14,690

22,206

33,505

32,216

Other revenue

6,215

16,694

13,491

32,449

Total revenue

198,627

224,440

430,872

397,424

Operating expenses

External provider costs

153,115

156,995

334,056

267,668

Cost of care

42,593

40,192

85,726

78,819

Sales and marketing

1,378

3,327

4,441

7,092

Corporate, general and administrative

14,780

20,849

34,888

44,813

Depreciation and amortization

6,512

6,828

13,218

13,404

Impairment of long-lived assets

132,990

-

132,990

-

Goodwill impairment

-

-

-

98,000

Total operating expenses

351,368

228,191

605,318

509,797

Operating loss

(152,741

)

(3,750

)

(174,446

)

(112,373

)

Nonoperating (expenses) income

Interest expense

(20,376

)

(13,197

)

(40,131

)

(23,908

)

Change in fair value of derivative liabilities

2,355

434

(26

)

1,540

(Loss) gain on remeasurement of contingent earnout liabilities

-

(16,220

)

-

19,916

Other income, net

382

534

992

721

Total nonoperating expenses

(17,639

)

(28,449

)

(39,165

)

(1,730

)

Loss before income tax

(170,381

)

(32,199

)

(213,612

)

(114,103

)

Income tax expense

(177

)

(177

)

(354

)

(355

)

Net loss

$

(170,558

)

$

(32,376

)

$

(213,966

)

$

(114,458

)

Weighted-average basic shares outstanding 1

3,807,551

3,722,377

3,793,076

3,717,040

Weighted-average diluted shares outstanding 1

3,807,551

3,722,377

3,793,076

3,717,040

Net loss per share

Basic

$

(44.79

)

$

(8.70

)

$

(56.41

)

$

(30.79

)

Diluted

$

(44.79

)

$

(8.70

)

$

(56.41

)

$

(30.79

)

1 Share amounts have been restated to reflect the 1-for-30 reverse stock split that the Company completed on January 31, 2024.

CAREMAX, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)

Six Months Ended June 30,

2024

2023

CASH FLOWS FROM OPERATING ACTIVITIES

Net loss

$

(213,966

)

$

(114,458

)

Adjustments to reconcile net loss to cash and cash equivalents:

Depreciation and amortization expense

13,218

13,404

Amortization of debt issuance costs and discounts

1,821

4,086

Impairment of long-lived assets

132,990

-

Stock-based compensation expense

4,761

4,762

Deferred income taxes

354

355

Change in fair value of derivative liabilities

26

(1,540

)

Gain on remeasurement of contingent earnout liabilities

-

(19,916

)

Payment-in-kind interest expense

21,955

5,500

Non-cash finance lease expense

293

-

Provision for credit losses

(307

)

57

Goodwill impairment

-

98,000

Amortization of right-of-use assets

5,325

5,842

Other non-cash, net

33

1,213

Changes in operating assets and liabilities:

Accounts receivable

17,573

(1,255

)

Other current assets

(6,481

)

452

Risk settlement liabilities

16,602

1,968

Other assets

(41,749

)

(41,807

)

Operating lease liabilities

(1,577

)

(4,959

)

Accounts payable

1,502

(128

)

Accrued expenses

(2,967

)

(4,219

)

Related party liabilities

1,582

(1,134

)

Other liabilities

898

10,515

Net cash used in operating activities

(48,114

)

(43,263

)

CASH FLOWS FROM INVESTING ACTIVITIES

Purchases of property and equipment

(794

)

(5,234

)

Net cash used in investing activities

(794

)

(5,234

)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from borrowings, net

-

62,000

Principal payments of debt

(189

)

(125

)

Payments of debt issuance costs

-

(398

)

Net cash (used in) provided by financing activities

(189

)

61,477

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS

(49,097

)

12,980

Cash and cash equivalents - beginning of period

65,528

41,626

CASH AND CASH EQUIVALENTS - END OF PERIOD

$

16,430

$

54,605

The following table represents Non-GAAP Financial Summary:

Non-GAAP Financial Summary

(Unaudited)

Three Months Ended

(in thousands)

Jun 30,
2022

Sep 30,
2022

Dec 31,
2022

Mar 31,
2023

Jun 30,
2023

Sep 30,
2023

Dec 31,
2023

Mar 31,
2024

Jun 30,
2024

Medicare risk-based revenue

$

143,664

$

122,267

$

113,041

$

121,593

$

155,486

$

134,105

$

108,650

$

168,502

$

154,857

Medicaid risk-based revenue

19,896

19,852

36,620

25,626

30,054

23,950

26,263

37,653

22,865

Government value-based care revenue

-

-

6,389

10,010

22,206

28,067

7,425

18,815

14,690

Other revenue

8,719

15,551

8,213

15,754

16,694

15,721

9,497

7,276

6,215

Total revenue

172,279

157,670

164,263

172,983

224,440

201,843

151,835

232,246

198,627

External provider costs

120,348

106,900

104,078

110,673

156,995

139,139

165,522

180,941

153,115

Cost of care

30,293

30,150

34,581

37,627

38,865

41,599

41,915

42,229

41,808

Platform contribution

21,638

20,620

25,604

24,683

28,580

21,106

(55,602

)

9,075

3,704

Platform contribution margin (%)

12.6

%

13.1

%

15.6

%

14.3

%

12.7

%

10.5

%

(36.6

%)

3.9

%

1.9

%

Sales and marketing

2,299

2,355

3,806

3,765

3,381

3,501

3,627

3,064

1,378

Corporate, general and administrative

12,165

13,877

17,263

21,329

18,158

15,527

12,531

16,495

13,480

Adjusted operating expenses

14,464

16,232

21,069

25,094

21,539

19,028

16,158

19,559

14,858

Adjusted EBITDA

$

7,175

$

4,388

$

4,535

$

(411

)

$

7,042

$

2,077

$

(71,759

)

$

(10,482

)

$

(11,152

)

The following table provides a reconciliation of GAAP net (loss) income to Adjusted EBITDA:

Reconciliation to Adjusted EBITDA

(Unaudited)

Three Months Ended

(in thousands)

Jun 30,
2022

Sep 30,
2022

Dec 31,
2022

Mar 31,
2023

Jun 30,
2023

Sep 30,
2023

Dec 31,
2023

Mar 31,
2024

Jun 30,
2024

Net (loss) income

$

(9,381

)

$

(22,053

)

$

10,434

$

(82,082

)

$

(32,376

)

$

(103,123

)

$

(465,766

)

$

(43,408

)

$

(170,558

)

Interest expense

3,896

6,088

8,743

10,711

13,197

14,000

16,526

19,756

20,376

Depreciation and amortization

4,903

4,573

7,180

6,576

6,828

6,833

7,550

6,705

6,512

Impairment of long-lived assets

-

-

-

-

-

-

-

-

132,990

Remeasurement of derivative and contingent earnout liabilities

(7,391

)

7,331

(84,171

)

(37,242

)

15,786

(1,450

)

(961

)

2,381

(2,355

)

Goodwill impairment

-

-

70,000

98,000

-

80,000

369,200

-

-

Stock-based compensation

2,788

3,611

2,786

2,298

2,464

3,243

2,595

2,365

2,396

Loss on extinguishment of debt

6,172

-

-

-

-

-

-

-

-

Business Combination integration costs (1)

1,887

2,586

163

716

686

483

833

381

399

Acquisition and disposition related costs (2)

4,074

2,118

10,632

622

815

652

1,069

1,052

(669

)

Other (3)

56

(47

)

(1,158

)

(187

)

(535

)

1,263

(1,409

)

109

(421

)

Income tax expense (benefit)

171

181

(20,074

)

177

177

177

(1,395

)

177

177

Adjusted EBITDA

$

7,175

$

4,388

$

4,535

$

(411

)

$

7,042

$

2,077

$

(71,759

)

$

(10,482

)

$

(11,152

)

Memo:

De novo pre-opening costs

$

506

$

2,426

$

3,205

$

1,975

$

1,560

$

1,880

$

1,323

$

1,366

$

1,775

De novo post-opening losses

993

1,533

2,274

3,885

4,228

3,906

4,558

3,451

2,789

(1)

Represents initial costs to set up public company processes, incremental vendor expenses identified as temporary or duplicative and expected to be rationalized in the short term, and legal and professional expenses outside of the ordinary course of business, which are being incurred as part of the Company's efforts as it integrates the two privately held companies that were combined in the Business Combination. Significant components of Business Combination integration costs were as follows:

(Unaudited)

Three Months Ended

(in thousands)

Jun 30,
2022

Sep 30,
2022

Dec 31,
2022

Mar 31,
2023

Jun 30,
2023

Sep 30,
2023

Dec 31,
2023

Mar 31,
2024

Jun 30,
2024

Consulting and legal fees (a)

$

887

$

725

$

257

$

282

$

237

$

69

$

451

$

371

$

389

Severance costs

252

1,080

167

11

13

-

-

-

-

Other (b)

748

782

(261

)

423

436

414

382

10

10

$

1,887

$

2,586

$

163

$

716

$

686

$

483

$

833

$

381

$

399

(a) Represents consulting and legal costs directly associated with efforts related to integration of the two privately held companies that were combined in the Business Combination.

(b) Represents primarily vendor expenses identified as temporary or duplicative and/or expenses outside the ordinary course of business and not necessary to run the Company's business.

(2)

Represents legal and incremental compensation payroll costs directly associated with efforts to achieve synergies related to closed transactions and legal and advisory costs related to exploration of potential dispositions. Significant components of the acquisition and disposition related costs were as follows:

(Unaudited)

Three Months Ended

(in thousands)

Jun 30,
2022

Sep 30,
2022

Dec 31,
2022

Mar 31,
2023

Jun 30,
2023

Sep 30,
2023

Dec 31,
2023

Mar 31,
2024

Jun 30,
2024

Advisor and other professional fees (a)

$

2,359

$

1,219

$

9,877

$

(258

)

$

(34

)

$

94

$

352

$

524

$

(967

)

Compensation costs (b)

1,715

899

755

880

849

558

717

528

444

$

4,074

$

2,118

$

10,632

$

622

$

815

$

652

$

1,069

$

1,052

$

(524

)

(a) Includes payments to our third-party transaction advisory firm associated with transaction contracts, including the Steward transaction that closed in November 2022. Also, costs include legal and accounting fees directly associated with contemplated or closed transactions or potential dispositions.

(b) Includes incremental payroll compensation expense for employees directly associated with services to achieve synergies related to closed transactions.

(3)

Components of other were as follows:

(Unaudited)

Three Months Ended

(in thousands)

Jun 30,
2022

Sep 30,
2022

Dec 31,
2022

Mar 31,
2023

Jun 30,
2023

Sep 30,
2023

Dec 31,
2023

Mar 31,
2024

Jun 30,
2024

Other income

$

-

$

-

$

(1,000

)

$

-

$

-

$

-

$

(874

)

$

-

$

-

Tax-related costs

69

(178

)

46

-

-

-

-

-

-

Interest income

-

(12

)

(201

)

(253

)

(602

)

(433

)

(560

)

(668

)

(277

)

Severance costs

-

-

-

-

-

1,639

-

694

-

Other

(14

)

144

(3

)

66

67

58

25

83

(144

)

$

56

$

(47

)

$

(1,158

)

$

(187

)

$

(535

)

$

1,263

$

(1,409

)

$

109

$

(421

)

The following metrics are as of the end of the indicated date, except for Platform Contribution, which is for the three month period ended as of the indicated date:

(Unaudited)

Three Months Ended

Non-GAAP Operating Metrics

Jun 30,
2022

Sep 30,
2022

Dec 31,
2022

Mar 31,
2023

Jun 30,
2023

Sep 30,
2023

Dec 31,
2023

Mar 31,
2024

Jun 30,
2024

Centers

48

51

62

62

62

62

56

55

50

Markets

6

7

7

7

7

7

7

6

6

Patients (MCREM)*

54,000

57,400

221,500

225,100

226,500

228,700

229,300

218,000

210,900

Patients in value-based care arrangements (MCREM)

81.0

%

78.2

%

97.6

%

99.0

%

99.4

%

98.8

%

98.8

%

99.1

%

99.4

%

Platform Contribution ($, millions)

$

21.6

$

20.6

$

25.6

$

24.7

$

28.6

$

21.1

$

(55.6

)

$

9.1

$

3.7

* MCREM defined as Medicare Equivalent Members, which assumes the level of support received by a Medicare patient is equivalent to that received by three Medicaid or Commercial patients.

The following table provides a reconciliation of gross profit, the most closely comparable GAAP financial measure, to Platform Contribution:

Reconciliation to Platform Contribution

(Unaudited)

Three Months Ended

(in millions)

Jun 30,
2022

Sep 30,
2022

Dec 31,
2022

Mar 31,
2023

Jun 30,
2023

Sep 30,
2023

Dec 31,
2023

Mar 31,
2024

Jun 30,
2024

Gross profit (a)

$

15.4

$

14.8

$

17.2

$

17.1

$

20.4

$

12.0

$

(63.5

)

$

1.5

$

(3.6

)

Depreciation and amortization

4.9

4.6

7.2

6.6

6.8

6.8

7.6

6.7

6.5

Stock-based compensation

1.3

1.2

1.2

1.0

1.3

1.2

0.1

0.7

0.7

Other adjustments (b)

0.1

0.1

-

-

-

1.0

0.2

0.2

0.1

Platform Contribution

$

21.6

$

20.6

$

25.6

$

24.7

$

28.6

$

21.1

$

(55.6

)

$

9.1

$

3.7

(a) Gross profit reflects the reclassification of stock-based compensation expense previously included in corporate, general and administrative expenses, which decreased gross profit by $1.3 million during the three months ended June 30, 2022, $1.2 million during the three months ended September 30, 2022, and $1.2 million during the three months ended December 31, 2022.

(b) Other adjustments include incremental costs related to post-Business Combination integration initiatives and other one-time center-level costs. During the three months ended September 30, 2023, December 31, 2023, and March 31, 2024, other adjustments include $1.0 million, $0.2 million and $0.2 million, respectively, of severance costs related to center staff.

The following table calculates the medical expense ratio:

(Unaudited)

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands, except ratio)

2024

2023

2024

2023

External provider costs

$

153,115

$

156,995

$

334,056

$

267,668

Medicare and Medicaid risk-based revenue

177,722

185,540

383,877

332,759

Medical Expense Ratio

86.2

%

84.6

%

87.0

%

80.4

%

Investor Relations
Roger Ou
SVP of Finance and Investor Relations
[email protected]

Source: CareMax, Inc.