Consumer Growth - NeueHealth reported a 45% aggregate growth in consumers served compared to the second quarter of last year, reaching approximately 547,000 consumers as of June 30, 2025[180][184]. - The number of value-based consumers served increased to 546,000 in 2025, up from 364,000 in 2024, representing a year-over-year increase of approximately 182,000 consumers[188][189]. - Enablement services lives reached approximately 148,000 in 2025, up from 113,000 in 2024, reflecting a growth in provider partnerships[188][190]. Financial Performance - Adjusted EBITDA for the second quarter of 2025 was $19,020,000, compared to $3,962,000 in the same period of 2024, indicating significant improvement in profitability[191][195]. - Income from continuing operations before income taxes for the second quarter of 2025 was $6,817,000, compared to a loss of $39,446,000 in the same quarter of 2024[191]. - The company reported a net loss of $1,548,000 for the second quarter of 2025, a significant improvement from a net loss of $57,698,000 in the same period of 2024[195]. Revenue Changes - Total revenue decreased by $16.9 million, or 7.5%, for the three months ended June 30, 2025, and $46.2 million, or 9.8%, for the six months ended June 30, 2025, compared to the same periods in 2024[198]. - ACO REACH revenue decreased by $34.5 million and $82.2 million for the three and six months ended June 30, 2025, respectively, primarily due to a decrease of approximately 10,000 beneficiaries aligned to REACH ACOs[198]. - Capitated revenue increased by $18.5 million, or 28.9%, for the three months ended June 30, 2025, and $38.0 million, or 30.3%, for the six months ended June 30, 2025, driven by increased membership through third-party payor contracts[199]. Cost Management - Medical costs decreased by $31.3 million, or 17.6%, for the three months ended June 30, 2025, and $67.3 million, or 18.0%, for the six months ended June 30, 2025, primarily due to a decrease in beneficiaries aligned to REACH ACOs[200]. - Operating costs decreased by $25.6 million, or 36.3%, for the three months ended June 30, 2025, and $43.7 million, or 31.8%, for the six months ended June 30, 2025, primarily due to a decrease in compensation-related costs[201]. - Operating cost ratio improved to 21.5% and 22.0% for the three and six months ended June 30, 2025, a decrease of 980 and 710 basis points compared to the same periods in 2024, respectively[202]. Strategic Initiatives - NeueHealth's focus on consumer-centric healthcare aims to reduce friction between payors and providers, enhancing the overall care experience[180][184]. - The company aims to enhance its data and analytics capabilities into a comprehensive value-based care enablement platform, which is expected to drive future performance and growth[184]. - NeueHealth's NEA Merger Agreement was announced on December 23, 2024, which will result in the company becoming a wholly owned subsidiary of NH Holdings 2025, Inc.[186]. Liquidity and Capital Structure - The company forecasts potential liquidity issues, indicating that existing cash and investments may not be sufficient to meet anticipated cash requirements for the next twelve months[223]. - As of June 30, 2025, the company had $96.4 million of long-term borrowings under the Amended 2023 Credit Agreement, with no additional available borrowings[235]. - As of June 30, 2025, the company had $212.9 million in cash and cash equivalents and $21.5 million in short-term investments[248]. Discontinued Operations - Loss from discontinued operations decreased by $10.1 million and $10.5 million for the three and six months ended June 30, 2025, respectively, as operating costs for the runout operations have further decreased[208]. - The company had no long-term investments as of June 30, 2025, across both continuing and discontinued operations[248]. Stock and Equity Transactions - The company issued 750,000 shares of Series A Preferred Stock for $750.0 million on January 3, 2022, and 175,000 shares of Series B Preferred Stock for $175.0 million on October 17, 2022[246].

Financial Performance - NeueHealth reported revenue of $209,082,000 for Q2 2025, a decrease of 7.5% compared to $225,991,000 in Q2 2024[4] - The company achieved a net loss of $1,548,000 in Q2 2025, significantly improved from a net loss of $57,698,000 in Q2 2024[4] - Adjusted EBITDA for Q2 2025 was $19,020,000, compared to $3,962,000 in Q2 2024, marking a substantial increase[4] - Total revenue for the three months ended June 30, 2025, was $209,082,000, a decrease of 7.4% compared to $225,991,000 in the same period of 2024[15] - Operating income for the three months ended June 30, 2025, was $14,257,000, compared to an operating loss of $37,549,000 in the same period of 2024[15] - Net loss attributable to common shareholders for the three months ended June 30, 2025, was $(23,501,000), a significant improvement from $(71,390,000) in 2024[15] - For the three months ended June 30, 2025, the net loss was $1,548 thousand, a significant improvement compared to a net loss of $57,698 thousand in the same period of 2024[24] - Adjusted EBITDA for the six months ended June 30, 2025, was $32,499 thousand, compared to $7,618 thousand for the same period in 2024, indicating a substantial increase in operational performance[24] Consumer Metrics - The number of value-based consumers served increased by 50% year-over-year, reaching 546,000 in Q2 2025, up from 364,000 in Q2 2024[4] - The company served approximately 694,000 consumers in Q2 2025, reflecting a 45% increase over the same period in 2024[6] Assets and Liabilities - Total assets as of June 30, 2025, were $743,689,000, an increase from $544,383,000 at the end of 2024[13] - Current liabilities rose to $908,412,000 as of June 30, 2025, compared to $710,228,000 at the end of 2024[13] - Cash and cash equivalents increased to $131,618,000 as of June 30, 2025, up from $83,295,000 at the end of 2024[13] - Cash and cash equivalents at the end of the period increased to $212,931,000 from $261,458,000 in the same period of 2024[17] Cost Management - Total operating expenses for the three months ended June 30, 2025, were $194,825,000, down from $263,540,000 in 2024, reflecting a decrease of 26.1%[15] - Medical costs for the three months ended June 30, 2025, were $146,410,000, a decrease from $177,681,000 in 2024, indicating a reduction of 17.6%[15] - The Operating Cost Ratio for the three months ended June 30, 2025, improved to 21.5% from 31.1% in 2024, reflecting enhanced cost management[25] - The Adjusted Operating Cost Ratio for the six months ended June 30, 2025, was 20.1%, compared to 17.1% in 2024, showing a slight increase in operational efficiency despite higher costs[25] Future Plans and Strategies - The company is focused on advancing its value-based care enablement platform to enhance clinical, financial, and administrative functions[3] - NeueHealth is pursuing a merger agreement with NH Holdings 2025, Inc., which could significantly impact its future operations[9] - The company plans to continue focusing on market expansion and new product development to drive future growth[15] - The company plans to continue focusing on operational improvements and cost management strategies to enhance future performance[25] Other Financial Metrics - Capitated revenue increased to $82,532,000 for the three months ended June 30, 2025, from $64,005,000 in 2024, representing a growth of 28.9%[15] - Interest expense for the three months ended June 30, 2025, increased to $6,878 thousand from $4,110 thousand in 2024, indicating rising financing costs[24] - Share-based and other long-term incentive compensation expense for the three months ended June 30, 2025, was $2,012 thousand, a decrease from $21,236 thousand in 2024, reflecting a reduction in non-cash compensation[24] - The company reported a loss from discontinued operations of $8,386 thousand for the three months ended June 30, 2025, down from $18,439 thousand in 2024, indicating improved performance in ongoing operations[24] - The EBITDA adjustments from continuing operations for the three months ended June 30, 2025, totaled $12,182 thousand, compared to $43,221 thousand in 2024, suggesting a shift in operational focus[24] - The company incurred transaction costs of $1,011 thousand for the three months ended June 30, 2025, compared to a gain of $844 thousand in 2024, highlighting the impact of financing activities[24]

PART I. FINANCIAL INFORMATION [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) Unaudited condensed consolidated financial statements for Q1 2025 report a **net loss of $10.8 million** and **operating income of $2.7 million**, with a 'going concern' warning [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, the pending NEA Merger, a 'Going Concern' warning, **$207.4 million** in long-term borrowings, and **$271.8 million** risk adjustment payable - On December 23, 2024, NeueHealth entered into a **merger agreement with an affiliate of New Enterprise Associates, Inc. (NEA)**, with stockholder approval obtained on May 7, 2025, pending other closing conditions[33](index=33&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk) - The company has a **$271.8 million** risk adjustment payable related to its discontinued commercial insurance business, with modified repayment agreements extending the due date to **September 15, 2026**, at an **11.5%** interest rate per annum[38](index=38&type=chunk)[39](index=39&type=chunk)[179](index=179&type=chunk) - Discontinued operations, including the sale of its California Medicare Advantage business and exit from commercial plans, resulted in a **net loss of $9.4 million** for Q1 2025[154](index=154&type=chunk)[155](index=155&type=chunk)[158](index=158&type=chunk) - The company participates in the CMS ACO REACH Model, recording a **$468.3 million** ACO REACH performance year receivable and a corresponding **$382.5 million** obligation as of March 31, 2025[142](index=142&type=chunk)[143](index=143&type=chunk)[147](index=147&type=chunk) Condensed Consolidated Balance Sheet Highlights (Unaudited) | Account | March 31, 2025 ($ in thousands) | December 31, 2024 ($ in thousands) | | :--- | :--- | :--- | | **Total Current Assets** | 788,206 | 434,648 | | **Total Assets** | **895,680** | **544,383** | | **Total Current Liabilities** | 1,064,052 | 710,228 | | **Total Liabilities** | **1,288,652** | **930,491** | | **Total Shareholders' Equity (Deficit)** | (1,361,158) | (1,355,105) | Condensed Consolidated Statements of Income (Loss) Highlights (Unaudited) | Account | Three Months Ended Mar 31, 2025 ($ in thousands) | Three Months Ended Mar 31, 2024 ($ in thousands) | | :--- | :--- | :--- | | **Total Revenue** | 215,787 | 245,095 | | **Total Operating Expenses** | 213,126 | 268,197 | | **Operating Income (Loss)** | 2,661 | (23,102) | | **Net (Loss) Income from Continuing Operations** | (1,438) | 5,688 | | **Loss from Discontinued Operations, Net of Tax** | (9,410) | (9,865) | | **Net Loss** | **(10,848)** | **(4,177)** | | **Net Loss Attributable to Common Shareholders** | (24,875) | (28,518) | | **Basic and Diluted Loss Per Share** | **(2.90)** | **(3.53)** | - The company's history of net losses, negative operating cash flows, and significant obligations raises **substantial doubt about its ability to continue as a going concern**, as existing cash is insufficient for the next 12 months[38](index=38&type=chunk)[43](index=43&type=chunk)[45](index=45&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=41&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2025 financial results, noting a **12.0% revenue decline** to **$215.8 million**, improved **operating income to $2.7 million**, and reiterating the 'going concern' warning - The company's strategic focus is on its two continuing segments: **NeueCare** (value-driven care delivery) and **NeueSolutions** (provider enablement)[183](index=183&type=chunk)[184](index=184&type=chunk)[185](index=185&type=chunk) Key Metrics (as of March 31) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Value-Based Consumers Served | 571,000 | 360,000 | | Enablement Services Lives | 138,000 | 109,000 | Adjusted EBITDA Reconciliation Highlight | Metric ($ in thousands) | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net Loss | (10,848) | (4,177) | | **Adjusted EBITDA** | **13,478** | **3,657** | - Management states that existing cash and investments are **not sufficient** to satisfy anticipated cash requirements for the next twelve months, leading to **substantial doubt about its ability to continue as a going concern**[222](index=222&type=chunk) [Results of Operations](index=45&type=section&id=Results%20of%20Operations) Q1 2025 total revenues decreased **12.0%** due to lower ACO REACH revenue, partially offset by capitated revenue growth, with significant reductions in medical and operating costs - Total revenues decreased by **12.0%** YoY, driven by a **$47.8 million** decline in ACO REACH revenue, partially offset by a **$19.5 million** increase in capitated revenue from growth in third-party payor contracts[201](index=201&type=chunk) - Operating costs decreased by **27.1%** YoY, mainly due to lower compensation-related costs from reduced employee headcount as part of ongoing restructuring efforts[203](index=203&type=chunk) [Segment Performance](index=47&type=section&id=Segment%20Performance) NeueCare segment operating income increased to **$23.0 million** due to capitated revenue growth, while NeueSolutions reported a stable **$3.0 million** operating loss with **27.8%** revenue decrease NeueCare Segment Performance ($ in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Segment Revenue | 90,517 | 73,623 | | Total Operating Expenses | 67,510 | 63,811 | | **Operating Income** | **23,007** | **9,812** | NeueSolutions Segment Performance ($ in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Segment Revenue | 127,610 | 173,896 | | Total Operating Expenses | 130,602 | 176,828 | | **Operating Loss** | **(2,992)** | **(2,932)** | [Liquidity and Capital Resources](index=48&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is critical, with **$239.3 million** in cash and investments and significant debt, raising substantial doubt about its ability to continue as a going concern - The company had **$224.8 million** in cash and cash equivalents and **$14.5 million** in short-term investments as of March 31, 2025, across both continuing and discontinued operations[249](index=249&type=chunk) - Cash used in operating activities decreased to **$21.0 million** in Q1 2025 from **$48.7 million** in Q1 2024, primarily due to lower payments for medical costs and risk adjustment obligations in discontinued operations[253](index=253&type=chunk) - The company has **multiple debt facilities**, including the 2023 Credit Agreement and the Hercules Credit Agreement, with **significant covenants and conditions** for accessing additional funds[228](index=228&type=chunk)[237](index=237&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=54&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This item is not applicable - Not applicable[257](index=257&type=chunk) [Controls and Procedures](index=54&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting - Based on an evaluation as of March 31, 2025, the CEO and CFO concluded that the company's disclosure controls and procedures were **effective at the reasonable assurance level**[260](index=260&type=chunk) - **No changes in internal control over financial reporting** occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control[261](index=261&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=55&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in several legal matters, including an appealed securities class action lawsuit and three lawsuits related to the pending NEA merger - A securities class action lawsuit (*Marquez v. Bright Health Group, Inc. et al.*) was dismissed on November 1, 2024, but the plaintiff filed an **appeal** on November 27, 2024[124](index=124&type=chunk) - **Three lawsuits** have been filed against the company related to the **NEA Merger** announced on December 23, 2024[125](index=125&type=chunk) [Risk Factors](index=55&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the 2024 Form 10-K - There have been **no material changes** to the risk factors disclosed in the 2024 Form 10-K[263](index=263&type=chunk) [Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=55&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) None reported for this item - None[264](index=264&type=chunk) [Defaults upon Senior Securities](index=55&type=section&id=Item%203.%20Defaults%20upon%20Senior%20Securities) None reported for this item - None[265](index=265&type=chunk) [Mine Safety Disclosures](index=55&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable - Not applicable[266](index=266&type=chunk) [Other Information](index=55&type=section&id=Item%205.%20Other%20Information) None reported for this item - None[267](index=267&type=chunk) [Exhibits](index=56&type=section&id=Item%206.%20Exhibits) Exhibits filed with the Form 10-Q include the NEA Merger Agreement, corporate governance documents, CMS repayment agreements, and CEO/CFO certifications - Filed exhibits include the **NEA Merger Agreement**, corporate certificates, **modified repayment agreements with CMS** for Florida and Colorado, and **CEO/CFO certifications**[268](index=268&type=chunk)

Consumer Metrics - NeueHealth served approximately 709,000 consumers in Q1 2025, a 51% increase compared to Q1 2024[6] - Value-based consumers served increased from 360,000 in Q1 2024 to 571,000 in Q1 2025, reflecting a growth of 59%[4] - NeueHealth's care model continues to resonate positively with consumers, providers, and payors, indicating strong market alignment[6] Financial Performance - Revenue for Q1 2025 was $215,787,000, down from $245,095,000 in Q1 2024, representing a decrease of 12%[4] - The company reported a net loss of $10,848,000 in Q1 2025, compared to a net loss of $4,177,000 in Q1 2024[4] - Total revenue for the three months ended March 31, 2025, was $215,787,000, a decrease of 12% from $245,095,000 in the same period of 2024[19] - Net loss attributable to common shareholders was $24,875,000, compared to a loss of $28,518,000 in the prior year[19] Adjusted EBITDA and Operating Income - Adjusted EBITDA for Q1 2025 was $13,478,000, a significant increase from $3,657,000 in Q1 2024, marking the fifth consecutive quarter of positive Adjusted EBITDA[4][6] - Adjusted EBITDA for the three months ended March 31, 2025, was $13,478,000, compared to $3,657,000 in 2024[28] - Operating income for the three months ended March 31, 2025, was $2,661,000, compared to a loss of $23,102,000 in the same period of 2024[19] Revenue Breakdown - Capitated revenue increased to $80,987,000, up 32% from $61,466,000 year-over-year[23] - ACO REACH revenue decreased by 28% to $124,040,000 from $171,811,000 in the prior year[24] Cash and Assets - Cash and cash equivalents as of March 31, 2025, were $138,101,000, up from $83,295,000 at the end of 2024[17] - Cash and cash equivalents at the end of the period increased to $224,830,000 from $249,430,000 in the previous year[21] - Total assets increased to $895,680,000 as of March 31, 2025, compared to $544,383,000 at the end of 2024[17] Liabilities and Operating Costs - Total liabilities rose to $1,288,652,000 as of March 31, 2025, from $930,491,000 at the end of 2024[17] - The operating cost ratio improved to 22.6% from 27.2% year-over-year[29] - Total operating expenses decreased to $213,126,000 from $268,197,000 in the same period of 2024[19] Cash Flow and Operating Activities - The company reported a net cash used in operating activities of $21,049,000, an improvement from $48,717,000 in the prior year[21] Strategic Focus - The company is focused on driving long-term, sustainable growth and enhancing relationships across the healthcare industry in 2025[3] Non-Cash Compensation and Transaction Costs - Non-cash compensation expense related to stock options and restricted stock unit awards was impacted by timing, quantity, and grant date fair value, with an additional $0.1 million recognized for the cancellation of P-Unit Awards in Q1 2025[31] - Transaction-related costs include accounting, tax, valuation, consulting, legal, and investment banking fees, which can vary and affect comparability, not reflecting ongoing business performance[31]

Compliance and Regulatory Risks - The company faces risks related to compliance with restrictive covenants in debt instruments, which could lead to defaults and adverse effects on financial condition if not managed properly[196]. - Compliance with healthcare laws is critical, as violations could result in severe penalties, including exclusion from government programs and reputational harm[208]. - The company is subject to federal and state privacy regulations regarding the handling of Personally Identifiable Information (PII) and Protected Health Information (PHI), with non-compliance potentially leading to significant liabilities[211]. - HIPAA mandates the establishment of safeguards for the protection of PHI, and failure to comply could adversely affect the company's operations and client trust[212]. - The company faces potential civil and criminal penalties for non-compliance with corporate practice of medicine laws, which vary significantly by state[220]. - The company is subject to ongoing scrutiny from the U.S. Department of Justice and the OIG, particularly under the FCA, leading to increased investigations and settlements in the healthcare industry[227]. - The company may incur significant costs related to compliance with inspections, audits, and investigations by federal and state authorities[226]. - Misconduct by employees or third parties could expose the company to regulatory sanctions and harm its reputation[229]. - The company anticipates continued legislative changes at both federal and state levels regarding privacy and cybersecurity, which may impact its operations[215]. - The use of AI and ML technologies presents regulatory challenges that could adversely affect the company's business and financial condition[219]. Financial Performance and Reporting - The company relies heavily on the Affordable Care Act (ACA) for revenue, and any changes to the ACA could materially affect financial performance and cash flows[201]. - The company had outstanding net operating losses (NOLs) of approximately $4.9 billion as of December 31, 2024, which are available to reduce future taxable income[241]. - The company may face limitations on utilizing its NOLs due to potential ownership changes, which could affect future taxable income[241]. - The company has significant requirements for financial reporting and internal controls, and failure to maintain these could adversely affect stock price[237]. - The company identified a material weakness in internal controls over financial reporting for the year ended December 31, 2022, related to the exit from the IFP business[231]. - Significant efforts were made in 2023 and 2024 to remediate the identified material weakness, including additional training sessions and enhancing policies and procedures[232]. - The company may be required to refund amounts paid and/or pay fines as a result of inspections and audits, which could materially affect its operating results[228]. - The company may encounter problems or delays in remediating deficiencies identified in internal controls, which could impact financial reporting[240]. - As of December 31, 2024, the company concluded that the material weakness was remediated, but future material weaknesses cannot be assured[234]. Market and Operational Risks - Changes in U.S. health insurance markets, including potential expansions of Medicare, could reduce demand for the company's services and adversely affect business operations[197]. - The outcome of the 2024 elections may lead to significant changes in Medicaid funding and eligibility, potentially impacting the company's revenue from state programs[198]. - Enhanced Advanced Premium Tax Credits (APTCs) have been extended through 2025, but their future reduction or elimination could make health insurance unaffordable for some individuals, impacting enrollment[202]. - The company’s contracts with third-party Medicare Advantage plans are subject to changes in Medicare rates, which could adversely affect profitability and cash flows[204]. - Significant reductions in Medicare reimbursement policies could lead to substantial revenue losses and increased operational costs for the company[205]. Stock and Asset Management - The trading price of the company's common stock has experienced significant volatility, which may continue in the future[245]. - The company does not intend to declare dividends on its common stock in the foreseeable future, relying on stock price appreciation for returns[250]. - The company’s stock price may decline if it fails to meet the expectations of securities analysts or investors[249]. - The company’s balance sheet includes significant amounts of intangible assets, and impairment of these assets could adversely affect operating results[242]. - Intangible assets accounted for approximately 19.14% of total assets of continuing operations on the consolidated balance sheet as of December 31, 2024[242]. - The company has issued 100,000,000 shares of preferred stock, which may have powers and preferences senior to common stock, potentially reducing its value[263]. - Increased costs associated with operating as a publicly traded company are expected, although the exact amount is currently uncertain[264]. Cybersecurity and IT Management - The company conducts annual cybersecurity risk assessments, including a NIST Cybersecurity Framework maturity assessment to identify strengths and areas for improvement[268]. - Cybersecurity risk is a standing agenda topic at quarterly Audit Committee meetings, focusing on threats, vulnerabilities, and monitoring activities[270]. - The management of cybersecurity threats is delegated to the Associate Vice President of IT Infrastructure and Security, who reports to the Vice President of Technology[273]. - The company utilizes various tools for managing cybersecurity threats, including machine learning and artificial intelligence for threat detection[274]. - As of the latest assessments, there are no known cybersecurity threats likely to materially affect the company's business strategy or financial condition[276]. - The Disclosure Committee meets quarterly to ensure accurate and timely public disclosures, discussing relevant cybersecurity risks[275].

Financial Performance - NeueHealth reported revenue of $232,638,000 for Q4 2024, a decrease from $292,871,000 in Q4 2023, and full-year revenue of $936,657,000, down from $1,160,802,000 in 2023[3]. - The company achieved a net income of $2,523,000 in Q4 2024, compared to a net loss of $460,572,000 in Q4 2023, and a full-year net loss of $99,717,000, improved from a loss of $1,265,808,000 in 2023[3]. - Adjusted EBITDA for Q4 2024 was $5,482,000, a significant improvement from a loss of $10,356,000 in Q4 2023, with full-year adjusted EBITDA at $22,496,000, compared to a loss of $8,480,000 in 2023[3]. - Total revenue for the year ended December 31, 2024, was $936.657 million, a decrease of 19.3% from $1,160.802 million in 2023[17]. - Capitated revenue increased to $259.881 million for the year ended December 31, 2024, up 18.3% from $219.774 million in 2023[17]. - ACO REACH revenue decreased significantly to $625.339 million in 2024, down 30.3% from $896.504 million in 2023[17]. - Operating loss for the year ended December 31, 2024, was $107.410 million, compared to a loss of $576.996 million in 2023, showing improvement[17]. - Net loss attributable to common shareholders for the year ended December 31, 2024, was $186.330 million, a reduction from $1,200.599 million in 2023[17]. - The company reported a net cash used in operating activities of $123.217 million for the year ended December 31, 2024, compared to $2,726.546 million in 2023, reflecting a significant reduction in cash burn[19]. - Total assets decreased to $544.383 million in 2024 from $1,225.480 million in 2023, indicating a substantial reduction in the asset base[17]. Consumer Growth and Market Strategy - The number of value-based consumers served increased to 360,000 in 2024, up from 355,000 in 2023, while enablement services lives rose to 123,000 from 106,000[3]. - The company is experiencing significant growth in 2025, serving 717,000 consumers, representing a 48% increase compared to 2024[5]. - NeueHealth is focused on strategic growth in 2025, aiming to serve more consumers in new and existing markets and strengthen relationships with payors and providers[2]. - NeueHealth's value-driven, consumer-centric care model is expected to continue transforming the healthcare experience and maximizing value across the healthcare system[7]. Operational Efficiency - Total current liabilities decreased to $710.228 million in 2024, down from $1,391.257 million in 2023, indicating improved liquidity[17]. - Medical costs for the year ended December 31, 2024, were $742.140 million, a decrease of 25.6% from $996.582 million in 2023[17]. - Operating income for Q4 2024 was $3,104,000, a significant improvement compared to a loss of $14,632,000 in Q4 2023[22]. - Total operating expenses decreased to $153,968,000 in Q4 2024 from $235,494,000 in Q4 2023, a reduction of 34.6%[22]. - Medical costs for Q4 2024 were $149,926,000, down from $231,095,000 in Q4 2023, a decrease of 35%[22]. - The Operating Cost Ratio increased to 31.3% in Q4 2024 from 22.3% in Q4 2023[27]. - Adjusted Operating Cost Ratio improved to 18.4% in Q4 2024 from 11.1% in Q4 2023[27]. Merger and Acquisition Activity - The company entered into a Merger Agreement with NH Holdings 2025, Inc., which will make NeueHealth a wholly owned subsidiary of Parent, controlled by private investment funds affiliated with New Enterprise Associates, Inc.[8]. - The company has filed a preliminary proxy statement with the SEC regarding the merger transaction, urging investors to read the relevant documents carefully[9]. - The company incurred $16,122,000 in transaction-related costs in Q4 2024, compared to $4,363,000 in Q4 2023[26].

Consumer Base - As of September 30, 2024, NeueCare maintained approximately 404,000 consumers, including 347,000 value-based consumers and 57,000 fee-for-service consumers[198] - NeueSolutions had approximately 43,000 value-based care consumers attributed to its REACH ACOs and 119,000 enablement services lives as of September 30, 2024[199] - Year-over-year, the number of value-based care consumers increased by approximately 35,000, driven by a rise of 55,000 through third-party payor relationships[208] - Enablement services lives increased to approximately 119,000 as of September 30, 2024, compared to 31,000 in the previous year[207] - The company aims to diversify and grow its consumer base across all product categories, including ACA Marketplace, Medicare, and Medicaid[202] Financial Performance - The company reported an Adjusted EBITDA of $9,396,000 for the three months ended September 30, 2024, compared to $3,431,000 for the same period in 2023, marking a significant increase[210] - The loss from continuing operations before income taxes for the three months ended September 30, 2024, was $23,214,000, a substantial improvement from $482,690,000 for the same period in 2023[210] - The net loss for the three months ended September 30, 2024, was $40,365,000, a significant reduction from $547,148,000 for the same period in 2023[214] - Total revenue decreased by $36.5 million, or 13.5%, for the three months ended September 30, 2024, and $163.9 million, or 18.9%, for the nine months ended September 30, 2024, compared to the same periods in 2023[219] - ACO REACH revenue decreased by $50.6 million and $205.8 million for the three and nine months ended September 30, 2024, respectively, primarily due to a decrease of approximately 20,000 beneficiaries aligned to the REACH ACOs[219] Costs and Expenses - Medical costs decreased by $43.7 million, or 19.3%, for the three months ended September 30, 2024, and $174.5 million, or 23.8%, for the nine months ended September 30, 2024, primarily due to a decrease in beneficiaries aligned to the REACH ACOs[220] - Operating costs decreased by $8.5 million, or 11.7%, for the three months ended September 30, 2024, and $20.6 million, or 9.3%, for the nine months ended September 30, 2024, primarily due to a reduction in professional fees[221] - The operating cost ratio increased to 27.5% and 28.6% for the three and nine months ended September 30, 2024, respectively, reflecting a decline in revenue that outweighed the decrease in operating costs[222] - Interest expense decreased by $4.6 million and $14.5 million for the three and nine months ended September 30, 2024, respectively, primarily due to the payoff of the 2021 Credit Agreement[225] - Loss from discontinued operations decreased by $53.5 million and $197.7 million for the three and nine months ended September 30, 2024, respectively, due to the sale of the California Medicare Advantage business[229] Investments and Financing - The company acquired full ownership of Centrum Health on October 30, 2024, to streamline operations and enhance its value-driven care model[203] - The company declared $28.2 million in dividends from regulated insurance entities during the nine months ended September 30, 2024, compared to no dividends in the same period of 2023[249] - As of September 30, 2024, the company was out of compliance with minimum risk-based capital and surplus levels for certain regulated insurance entities[250] - The company had $86.4 million in long-term borrowings under the Amended 2023 Credit Agreement as of September 30, 2024[260] - The Company has a term loan Tranche 2 of up to $25,000,000 available from November 10 to December 31, 2024, subject to achieving specific funding milestones[263] Cash Flow - As of September 30, 2024, the Company had $226.4 million in cash and cash equivalents and $15.8 million in short-term investments[273] - The net cash used in operating activities for the nine months ended September 30, 2024, was $(98,823) thousand, a decrease of $2.3 billion compared to the same period in 2023[278] - Net cash provided by investing activities for the nine months ended September 30, 2024, was $189,230 thousand, a decrease of $956.2 million compared to the prior year[279] - The Company had net cash used in financing activities of $(239,274) thousand for the nine months ended September 30, 2024, an increase of $280.3 million compared to the same period in 2023[280] - As of September 30, 2024, the Company had letters of credit of $16.5 million and surety bonds of $19.7 million[269] Stock and Assets - The Centrum Promissory Note issued on October 29, 2024, has a principal of $64.0 million and bears a cash interest rate of 6% per annum, due on October 29, 2028[270] - The Company issued 750,000 shares of Series A Preferred Stock for $750.0 million and 175,000 shares of Series B Preferred Stock for $175.0 million[271] - As of September 30, 2024, the Company had non-regulated cash and cash equivalents of $110.3 million, with $33.7 million restricted as collateral[274]

Financial Performance - NeueHealth reported a revenue of $232.9 million for Q3 2024, a decrease of 13.5% compared to $269.4 million in Q3 2023[4] - The company achieved an Adjusted EBITDA of $9.4 million in Q3 2024, up from $3.4 million in Q3 2023, marking the third consecutive quarter of positive Adjusted EBITDA[4] - Net loss for Q3 2024 was reported at $40.4 million, a significant improvement from a net loss of $547.1 million in Q3 2023[4] - Total revenue for the three months ended September 30, 2024, was $232,933,000, a decrease of 13.5% compared to $269,399,000 for the same period in 2023[13] - Operating loss for the nine months ended September 30, 2024, was $(77,993,000), an improvement from $(531,061,000) in the same period of 2023[13] - Net loss attributable to common shareholders for the three months ended September 30, 2024, was $(70,475,000), compared to $(646,357,000) in the prior year[13] - The company reported a net loss of $(40,365) for the three months ended September 30, 2024, compared to $(547,148) for the same period in 2023[21] Revenue Breakdown - Capitated revenue increased to $71,334,000 for the three months ended September 30, 2024, up 18.3% from $60,371,000 in the prior year[13] - ACO REACH revenue decreased significantly to $149,477,000, down 25.2% from $200,044,000 year-over-year[13] - Total segment revenue for NeueCare was $83,867,000 for the three months ended September 30, 2024, an increase of 24.9% from $67,134,000 in the same period of 2023[16] - Total segment revenue for the nine months ended September 30, 2024, was $478,014, down 29.6% from $678,521 in the prior year[17] Cost Management - Total operating expenses for the three months ended September 30, 2024, were $250,275,000, a decrease of 65.8% from $732,174,000 in the same period of 2023[13] - Total operating expenses for the three months ended September 30, 2024, were $157,875, down from $230,132 in the prior year[17] - Medical costs for the three months ended September 30, 2024, were $182,693,000, a decrease from $226,438,000 in the prior year[13] - Medical costs for the three months ended September 30, 2024, were $153,840, a decrease from $204,017 in the same period of 2023[17] - The Operating Cost Ratio for the three months ended September 30, 2024, was 27.5%, up from 26.9% in the prior year[22] - Adjusted Operating Cost Ratio for the nine months ended September 30, 2024, improved to 17.8% from 15.9% in the same period last year[22] - The impact of share-based compensation on the Operating Cost Ratio was (7.0)% for the three months ended September 30, 2024[22] Consumer and Market Growth - As of September 30, 2024, NeueHealth served 390,000 value-based consumers, an increase of 9.86% from 355,000 in the same period of 2023[3] - The number of lives served through enablement services rose significantly to 119,000, compared to just 31,000 a year earlier, representing a growth of 283.87%[3] - The company is well-positioned to capitalize on strategic growth opportunities in 2025 and beyond, focusing on aligning interests among consumers, providers, and payors[2] Future Projections - For the full year 2024, NeueHealth expects total revenue to be approximately $950 million, with NeueCare revenue projected at $320 million and NeueSolutions revenue at $640 million[5] - The company reaffirmed its Adjusted EBITDA guidance for 2024, expecting it to be between $15 million and $25 million[5] Asset and Liability Management - Total assets as of September 30, 2024, were reported at $696.8 million, a decrease from $1.2 billion at the end of 2023[12] - Current liabilities decreased to $872.4 million from $1.4 billion at the end of 2023, indicating improved financial management[12]

Consumer and Care Services - As of June 30, 2024, NeueHealth served approximately 372,000 consumers, including 320,000 value-based consumers and 52,000 fee-for-service consumers[165] - NeueSolutions had approximately 44,000 value-based care consumers attributed to its REACH ACOs and 113,000 enablement services lives as of June 30, 2024[166] - Value-based consumers decreased by approximately 9,000 year-over-year, driven by a decline of approximately 24,000 ACO REACH lives, partially offset by an increase of 15,000 through third-party payor relationships[175] - The company reported a year-over-year increase in enablement services lives from 31,000 in June 2023 to 113,000 in June 2024[174] - NeueHealth's model aims to improve care delivery by fostering strong relationships with consumers and providers, focusing on personalized care[170] - The company is committed to aligning the interests of consumers, providers, and payors to enhance the healthcare experience[172] Financial Performance - Adjusted EBITDA for the three months ended June 30, 2024, was $3.962 million, compared to $7.797 million for the same period in 2023[178] - The net loss from continuing operations for the three months ended June 30, 2024, was $(39.446) million, compared to $(32.584) million for the same period in 2023[182] - Total revenue decreased by $72.0 million, or 24.2%, for the three months ended June 30, 2024, and $127.4 million, or 21.3%, for the six months ended June 30, 2024, compared to the same periods in 2023[186] - ACO REACH revenue decreased by approximately $87.2 million and $155.2 million for the three and six months ended June 30, 2024, respectively, due to a decrease of about 24,000 beneficiaries aligned to REACH ACOs[186] - Capitated revenue increased by $14.2 million, or 28.6%, for the three months ended June 30, 2024, and $26.2 million, or 26.3%, for the six months ended June 30, 2024, compared to the same periods in 2023[193] - Service revenue increased by $1.6 million and $3.4 million for the three and six months ended June 30, 2024, respectively, compared to the same periods in 2023[199] Cost Management - Medical costs decreased by $67.5 million, or 27.5%, for the three months ended June 30, 2024, and $130.7 million, or 25.9%, for the six months ended June 30, 2024, compared to the same periods in 2023[187] - Operating costs decreased by $0.1 million, or 0.1%, for the three months ended June 30, 2024, and $12.8 million, or 8.5%, for the six months ended June 30, 2024, compared to the same periods in 2023[188] - Total operating expenses were $263.5 million for the three months ended June 30, 2024, down from $321.4 million in the same period in 2023[185] - The operating cost ratio increased to 31.1% for the three months ended June 30, 2024, up from 23.6% in the same period in 2023[188] - Medical costs decreased by $84.0 million and $150.6 million for the three and six months ended June 30, 2024, respectively, compared to the same periods in 2023[199] Strategic Initiatives and Growth - The company is evaluating strategic growth opportunities to expand payor and provider partnerships and grow consumer numbers in new geographies[168] - The company recognized $11.4 million in impairments of intangible assets for the three and six months ended June 30, 2024, due to classifying AMD as held-for-sale[189] Capital and Liquidity - The company secured up to $150 million in a new term loan facility with Hercules Capital, strengthening its capital position[167] - As of June 30, 2024, the company had $66.4 million of long-term borrowings under the 2023 Credit Agreement[209] - The company declared $28.2 million of dividends from regulated insurance entities to the parent company during the six months ended June 30, 2024[203] - The company is out of compliance with minimum risk-based capital and surplus levels for certain regulated insurance legal entities as of June 30, 2024[204] - The company forecasts potential inability to satisfy obligations due to liquidity concerns, raising substantial doubt about its ability to continue as a going concern[200] - The company entered into a Hercules Credit Agreement providing up to $150.0 million in term loans, maturing on June 1, 2028[213] - As of June 30, 2024, the company had $261.5 million in cash and cash equivalents and $16.3 million in short-term investments[219] - The cash and cash equivalents at the beginning of the period for 2024 were $375.3 million, compared to $1,932.3 million at the beginning of 2023[220] - The total net decrease in cash and cash equivalents for the six months ended June 30, 2024, was $113.8 million[220] - The company had no long-term investments as of June 30, 2024, across both continuing and discontinued operations[219] Debt and Financing Activities - Net cash used in operating activities for the six months ended June 30, 2024, decreased by $646.9 million compared to the same period in 2023[221] - Net cash provided by investing activities increased by $32.2 million for the six months ended June 30, 2024, primarily due to the sale of the California Medicare Advantage business[222] - Net cash used in financing activities increased by $221.0 million for the six months ended June 30, 2024, attributed to the payoff of short-term debt from the sale proceeds[223] - As of June 30, 2024, the company had letters of credit of $16.5 million and surety bonds of $19.7 million[217] - The company issued 750,000 shares of Series A Preferred Stock for $750.0 million and 175,000 shares of Series B Preferred Stock for $175.0 million[218] - As of June 30, 2024, $52.0 million of non-regulated cash and cash equivalents was restricted as collateral for letters of credit and surety bonds[219]

Revenue and Financial Performance - Revenue for Q2 2024 was $225.991 million, a decrease of 24.1% from $297.982 million in Q2 2023[2] - Total revenue for the three months ended June 30, 2024, was $225,991, a decrease of 24.1% from $297,982 in the same period of 2023[10] - Capitated revenue increased to $64,005 for the three months ended June 30, 2024, compared to $49,764 in the prior year, representing a growth of 28.6%[10] - Total segment revenue for NeueCare for the three months ended June 30, 2024, was $76,985, an increase from $66,068 in the same period of 2023, representing a growth of 18.5%[12] - Total segment revenue for the six months ended June 30, 2024, was $321,613, down from $476,801 in the same period of 2023, reflecting a decline of about 32.6%[13] Net Loss and Adjusted EBITDA - Net loss for Q2 2024 was $(57.698) million, compared to a net loss of $(88.627) million in Q2 2023, showing an improvement of 34.8%[2] - Net loss attributable to common shareholders for the three months ended June 30, 2024, was $(71,390), compared to $(125,005) in the same period of 2023, reflecting a reduction of 42.9%[10] - Adjusted EBITDA for Q2 2024 was $3.962 million, down from $7.797 million in Q2 2023[2] - Adjusted EBITDA for the three months ended June 30, 2024, was $3,962, down from $7,797 in the same period of 2023, a decline of approximately 49.1%[18] - NeueCare Adjusted EBITDA for the three months ended June 30, 2024, was $13,496, compared to $15,593 for the same period in 2023, a decrease of approximately 13.5%[21] - Adjusted EBITDA for the three months ended June 30, 2024, was $(566,000), a significant decrease from $2,996,000 in the prior year[22] - For the six months ended June 30, 2024, NeueSolutions reported an Adjusted EBITDA of $(2,250,000), down from $1,487,000 in the same period of 2023[22] Operating Expenses and Costs - Total operating expenses for the three months ended June 30, 2024, were $263,540, a decrease of 17.9% from $321,396 in the same period of 2023[10] - Total operating expenses for the three months ended June 30, 2024, were $151,678, compared to $234,690 for the same period in 2023, a reduction of about 35.4%[13] - Medical costs for the three months ended June 30, 2024, were $177,681, down from $245,160 in the same period of 2023, indicating a decrease of 27.5%[10] - Medical costs for the three months ended June 30, 2024, were $147,258, down from $231,279 in the same period of 2023, indicating a decrease of approximately 36.3%[13] - The company incurred restructuring charges of $239 for the three months ended June 30, 2024, compared to $1,285 in the same period of 2023, reflecting a decrease of 81.4%[10] Assets and Liabilities - Total assets as of June 30, 2024, were $897.265 million, down from $1,225.480 million at the end of 2023[9] - Total liabilities decreased to $1,179.803 million from $1,480.098 million at the end of 2023[9] Future Projections and Guidance - For 2024, revenue is expected to be approximately $950 million, with NeueCare revenue projected at $320 million and NeueSolutions revenue at $640 million[5] - Adjusted EBITDA guidance for 2024 is between $15 million and $25 million[5] - The company aims to reach the high end of its guidance range for consumers served by year-end 2024[3] Consumer Metrics - Value-based consumers served decreased to 364,000 as of June 2024, down from 373,000 in June 2023[1] - Enablement services lives increased significantly to 113,000 from 31,000 year-over-year[1] Cash Flow and Operating Activities - Cash and cash equivalents at the end of the period were $261,458, down from $1,360,441 at the end of the same period in 2023[11] - The company reported a net cash used in operating activities of $(77,148) for the six months ended June 30, 2024, compared to $(724,026) in the same period of 2023, showing a significant improvement[11] Special Items and Adjustments - The company recognized $11.4 million in intangible asset impairment expense due to operations classified as held-for-sale in the second quarter of 2024[22] - The non-cash compensation expense related to stock options and restricted stock units was estimated at $2.5 million for the three and six months ended June 30, 2024[22] - Restructuring and contract termination costs were incurred as part of a workforce reduction and early lease terminations, impacting the financial results[22] - The company plans to exclude the impact of held-for-sale operations from Adjusted EBITDA starting in the second quarter of 2024[22] - Transaction costs related to financing initiatives can vary significantly from period to period, affecting comparability of financial performance[22]