What the changes say
- A large commercial Payor is terminating contracts representing $322 million, or 12%, of 2025 revenue, including nearly all capitation revenue.
- The P&HS sale leaves Accendra Health smaller and single-segment, increasing operating and cash-flow volatility.
- CMS coverage criteria may make NIPPV reimbursement harder for new COPD patients.
- Debt now includes $326 million Term Loan A, $511 million Term Loan B and $204 million revolver borrowings.
What changed since the prior 10-K
New
- NewOperational Risks
We have concentration in and dependence on certain Payors
Dependence on two commercial Payors and government programs is significant; terminated contracts represent $322 million, or 12%, of 2025 revenue.
- NewOperational Risks
The recent termination of certain contracts commercial Payor could negatively impact our financial condition, results of operations, cash flows, capital resources and liquidity
A commercial Payor is winding down contracts representing $322 million of revenue, including $231 million of capitation revenue, during the first half of 2026.
- NewOperational Risks
A determination from the Centers for Medicare and Medicaid Services (CMS) would reduce reimbursement qualification for non-invasive ventilation products, which could negatively impact our financial condition, results of operations, cash flows, capital resources and liquidity
CMS’s June 2025 NIPPV coverage determination may make reimbursement qualification harder for new COPD patients.
- NewRisks Related to the Sale of our Products & Healthcare Services Business
We have sold our P&HS business, and there may be negative impacts on our financial condition, results of operations, cash flows, capital resources and liquidity
Selling P&HS leaves Accendra Health smaller and single-segment, with less diversification and potentially greater earnings, cash-flow and financing volatility.
- NewRisks Related to the Sale of our Products & Healthcare Services Business
In connection with the sale of the P&HS business, we are required to provide certain transitional services which may divert management’s attention and harm our business
Providing transitional services to the P&HS buyer may undercompensate costs and divert management from the remaining business.
- NewRisks Related to the Sale of our Products & Healthcare Services Business
In connection with the sale of the P&HS business, we are receiving certain transitional services and are dependent on the successful execution of these services by a third party
Accendra Health depends on the P&HS buyer’s transitional services and could be harmed if it cannot transition away on time.
- NewRisks Related to the Sale of our Products & Healthcare Services Business
Certain contracts used in our business were transferred or may need to be transferred or replaced in connection with the sale of the P&HS business and any failure to obtain such replacement contracts could increase our expenses or otherwise adversely affect our results of operations
Replacing shared contracts after the P&HS sale may require accepting worse terms or increase expenses if contracts cannot be obtained.
- NewRisks Related to the Sale of our Products & Healthcare Services Business
The sale of certain assets associated with the P&HS business could negatively impact our business, and retained liabilities from businesses or assets that we have sold could adversely affect our financial results
P&HS asset sales may leave indemnities, retained liabilities, buyer disputes, lost earnings and goodwill or intangible-asset write-offs.
- NewIndustry and Economic Risks
We are a Medicare-certified supplier and participates in state Medicaid programs. Failure to comply with applicable standards and regulations could result in civil or criminal sanctions, including the loss of our ability to participate in Medicare, Medicaid and other federal and state healthcare programs
Medicare, Medicaid, HIPAA, privacy, data-protection and healthcare billing requirements create risks of penalties, remediation costs, exclusion and reputational harm.
- NewIndustry and Economic Risks
developing and implementing requirements related to the functionality, safety, efficacy, and privacy of AI and machine learning technologies. The increased cost and difficulty with complying with such legal requirements, or a failure to do so, may have an adverse effect our business
Evolving federal and state requirements for healthcare AI and machine learning may increase compliance costs or restrict operations.
Dropped
- DroppedOperational Risks
We have concentration in and dependence on certain healthcare provider customers, Group Purchasing Organizations, and Payors
- DroppedOperational Risks
An interruption in the ability of our business to manufacture products or the proper functioning of critical facilities and distribution networks may have a material adverse effect on our business and operations
- DroppedOperational Risks
Our capitation arrangements may prove unprofitable if actual utilization rates exceed our assumptions
Concentration among healthcare provider customers, GPOs and hospitals represented through Vizient, Premier and HPG.
- DroppedOperational Risks
We cannot assure you that the potential sale of the Products & Healthcare Services segment will be completed; and there may be negative impacts on our business, financial results, and operations
- DroppedOperational Risks
We cannot assure you that the proposed acquisition of Rotech (Rotech Acquisition) will be completed
- DroppedOperational Risks
We may fail to realize the anticipated benefits of the Rotech Acquisition or those benefits may take longer to realize than expected. We may also encounter significant difficulties in integrating the Rotech business into our operations
- DroppedOperational Risks
We and the Rotech business will be subject to business uncertainties while the Rotech Acquisition is pending that could adversely affect our business and the Rotech business
- DroppedOperational Risks
The pendency of the Rotech Acquisition could adversely affect our business, financial results, and operations
Manufacturing, facilities and distribution-network interruptions across multiple countries.
- DroppedIndustry and Economic Risks
An inability to obtain key components, raw materials or manufactured products from third parties in a timely and cost-effective manner, or a material disruption in our supply chain, may have a material adverse effect on our business
Capitation arrangements becoming unprofitable when patient utilization exceeds assumptions.
- DroppedIndustry and Economic Risks
consequences of financial and economic decline could have a material adverse effect on our business, results of operations, financial condition and cash flows
- DroppedIndustry and Economic Risks
Our Products & Healthcare Services segment is exposed to price fluctuations of key commodities, which may negatively impact our results of operations and cash flows
Risks that the proposed P&HS sale would not close or would disrupt relationships.
- DroppedIndustry and Economic Risks
Our profitability and cash flows may vary based on the impacts of rising inflationary pressures
Risks that the proposed Rotech acquisition would not close as planned.
- DroppedIndustry and Economic Risks
We may incur product liability losses, litigation liability, product recalls, safety alerts or regulatory action associated with the provision of healthcare services, and the products that we source, assemble, manufacture and sell which can be costly and disruptive to our business
Failure to realize Rotech acquisition benefits or integrate Rotech successfully.
- DroppedIndustry and Economic Risks
there is no guarantee that future recommendations or sanctions will be resolved on the same timeline or favorably, if at all
Business uncertainty affecting customers, suppliers and employee retention while Rotech acquisition remained pending.
- DroppedIndustry and Economic Risks
including media campaigns and litigation, to advance their perspectives. To the extent we are subject to such activism, it may require us to incur costs or otherwise adversely impact our business
Disruption and management distraction caused by the pending Rotech acquisition.
- DroppedRisks Related to Our Debt
be able to consummate those dispositions or to obtain the proceeds that we could realize from them, and these proceeds may not be adequate to meet any debt service obligations then due
- DroppedRisks Related to Our Debt
Despite current indebtedness levels, we will incur substantially more debt to complete the Rotech Acquisition
- DroppedRisks Related to Our Debt
We are subject to risks related to public health crises, future outbreaks of health crises or other adverse public health developments
- DroppedRisks Related to Our Debt
Our global operations increase the extent of our exposure to the economic, political, currency, regulatory and other risks of international operations
Reworded
- 87% rewrittenIndustry and Economic Risks
Litigation & Regulatory Risks
The section now adds intellectual-property, litigation, tax, ESG and amended-bylaw risks while removing product-clearance and broader operational regulatory language.
- 82% rewrittenIndustry and Economic Risks
We are subject to stringent regulatory and licensing requirements, and we have been, are and in the future could become the subject of federal and state investigations and compliance reviews
The risk is narrowed from U.S. and international requirements to U.S. federal, state and local regulatory and licensing obligations.
Was: We are subject to stringent regulatory and licensing requirements, and we have been, are and could become the subject of federal and state investigations and compliance reviews
- 76% rewrittenIndustry and Economic Risks
We must obtain clearance or approval from appropriate regulatory authorities prior to consummating transactions of certain healthcare related businesses
The substance is substantially unchanged; the updated text retains the 15-state healthcare-investment oversight discussion and transaction-delay risks.
- 59% rewrittenOperational Risks
Our business is dependent on certain significant suppliers
Supplier dependence shifts from roughly 1,000 P&HS suppliers and 37% of revenue from the ten largest to home-health suppliers representing about 40% of purchases.
- 48% rewrittenIndustry and Economic Risks
Uncertainty about current and future economic conditions and other adverse changes in general political conditions may adversely affect demand for our products and services and collectability of our accounts receivable
The updated risk drops foreign operations and accounts-receivable collectability, while retaining demand, inventory, supplier-term and reimbursement pressures.
- 48% rewrittenIndustry and Economic Risks
We could be subject to adverse changes in the tax laws or challenges to our tax positions
The updated text removes foreign jurisdictions and the LIFO proposal, and adds indirect-supplier pass-through effects to tax risks.
- 47% rewrittenRisks Related to Our Debt
We may not be able to refinance, extend or repay our substantial indebtedness which would have a material adverse effect on our financial condition
Debt risk now includes $326 million and $511 million term loans, a $204 million revolver, and March 2027 maturities alongside the 2029 and 2030 Notes.
- 47% rewrittenRisks Related to Our Debt
The market price for our common stock and debt have been, and may continue to be, highly volatile
The visible updated text retains substantially the same volatility drivers but omits the prior-year introductory statement about common-stock and debt volatility.
- 46% rewrittenIndustry and Economic Risks
Our aspirations, goals and disclosures related to ESG matters expose us to numerous risks, including risks to our reputation and stock price
- 43% rewrittenRisks Related to Our Debt
We may not be able to generate sufficient cash to service our debt and other obligations
- 34% rewrittenRisks Related to Our Debt
Our continued success is substantially dependent on positive perceptions of our reputation
- 28% rewrittenIndustry and Economic Risks
We face increasing competition, accelerating pricing pressure and changes in technology
- 25% rewrittenRisks Related to Our Debt
Further, actions by the U.S. federal, state or local governments in response to any such public health developments could adversely affect our business and operations, such as closure of one or more facilities for an unknown period of time
Was: Further, actions by the U.S. government or other foreign governments in response to any such public health developments could adversely affect our business and operations, such as closure of one or more facilities for an unknown period of time
- 20% rewrittenOperational Risks
Our operations depend on the proper functioning of information systems, and our business or results of operations could be adversely affected if we experience a cyberattack or other systems breach or failure
All 41 risk factors
Headings as the filing states them, in filing order.
Risks Related to Our Debt
- 01Forward-Looking Statements and Risk Factors Summary
- 33We may not be able to refinance, extend or repay our substantial indebtedness which would have a material adverse effect on our financial condition47% rewritten
- 34We may not be able to generate sufficient cash to service our debt and other obligations43% rewritten
- 35Our credit facilities and our existing notes have restrictive covenants that could limit our financial flexibility
- 36Our variable rate indebtedness subjects us to interest rate risk, which could cause our indebtedness service obligations to increase significantly
- 37Despite current indebtedness levels, we may continue to incur indebtedness in the future, and the amount of that additional indebtedness may be substantial, which could further exacerbate the risks described herein
- 38Our continued success is substantially dependent on positive perceptions of our reputation34% rewritten
- 39Further, actions by the U.S. federal, state or local governments in response to any such public health developments could adversely affect our business and operations, such as closure of one or more facilities for an unknown period of time25% rewritten
- 40The market price for our common stock and debt have been, and may continue to be, highly volatile47% rewritten
- 41We may be adversely affected by global climate change or by legal, regulatory or market responses to such change
Industry and Economic Risks
- 02Litigation & Regulatory Risks87% rewritten
- 19We face increasing competition, accelerating pricing pressure and changes in technology28% rewritten
- 20Uncertainty about current and future economic conditions and other adverse changes in general political conditions may adversely affect demand for our products and services and collectability of our accounts receivable48% rewritten
- 21Changing conditions in the U.S. healthcare industry may impact our results of operations and cash flows
- 22We are subject to stringent regulatory and licensing requirements, and we have been, are and in the future could become the subject of federal and state investigations and compliance reviews82% rewritten
- 23We are a Medicare-certified supplier and participates in state Medicaid programs. Failure to comply with applicable standards and regulations could result in civil or criminal sanctions, including the loss of our ability to participate in Medicare, Medicaid and other federal and state healthcare programsNew
- 24developing and implementing requirements related to the functionality, safety, efficacy, and privacy of AI and machine learning technologies. The increased cost and difficulty with complying with such legal requirements, or a failure to do so, may have an adverse effect our businessNew
- 25We must obtain clearance or approval from appropriate regulatory authorities prior to consummating transactions of certain healthcare related businesses76% rewritten
- 26Our failure to comply with regulatory requirements or receive regulatory clearances or approvals for our medical gas facilities, products or operations could adversely affect our business
- 27Our business may be adversely affected if we are unable to adequately establish, maintain, protect and enforce our intellectual property and proprietary rights or prevent third parties from making unauthorized use of such rights
- 28We may become subject to litigation, investigations, claims and other legal proceedings brought by regulatory agencies, third parties, or individuals
- 29We could be subject to adverse changes in the tax laws or challenges to our tax positions48% rewritten
- 30Audits by tax authorities could result in additional tax payments for prior periods, and tax legislation could materially adversely affect our financial results and tax liabilities
- 31Our aspirations, goals and disclosures related to ESG matters expose us to numerous risks, including risks to our reputation and stock price46% rewritten
- 32Our amended and restated bylaws designate the U.S. District Court for the Eastern District of Virginia as the exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us
Operational Risks
- 03We have concentration in and dependence on certain PayorsNew
- 04Our failure to establish and maintain relationships with hospital and physician referral sources may cause our revenue to decline
- 05Possible changes in customer and product mix could have a material adverse effect on our business, financial condition, results of operations, cash flows, capital resources and liquidity
- 06Our business is dependent on certain significant suppliers59% rewritten
- 07Our operations depend on the proper functioning of information systems, and our business or results of operations could be adversely affected if we experience a cyberattack or other systems breach or failure20% rewritten
- 08The recent termination of certain contracts commercial Payor could negatively impact our financial condition, results of operations, cash flows, capital resources and liquidityNew
- 09A determination from the Centers for Medicare and Medicaid Services (CMS) would reduce reimbursement qualification for non-invasive ventilation products, which could negatively impact our financial condition, results of operations, cash flows, capital resources and liquidityNew
- 10Our ability to attract and retain talented and qualified teammates is critical to our success and competitiveness
- 11Our inability to adequately integrate acquisitions could have a material adverse effect on our operations
- 12Our operations involve the storage, transportation and provision of compressed and liquid oxygen, which carries an inherent risk of rupture or other accidents with the potential to cause substantial loss
- 13Our goodwill may become further impaired, which would require us to record a significant charge to earnings in accordance with generally accepted accounting principles
Risks Related to the Sale of our Products & Healthcare Services Business
- 14We have sold our P&HS business, and there may be negative impacts on our financial condition, results of operations, cash flows, capital resources and liquidityNew
- 15In connection with the sale of the P&HS business, we are required to provide certain transitional services which may divert management’s attention and harm our businessNew
- 16In connection with the sale of the P&HS business, we are receiving certain transitional services and are dependent on the successful execution of these services by a third partyNew
- 17Certain contracts used in our business were transferred or may need to be transferred or replaced in connection with the sale of the P&HS business and any failure to obtain such replacement contracts could increase our expenses or otherwise adversely affect our results of operationsNew
- 18The sale of certain assets associated with the P&HS business could negatively impact our business, and retained liabilities from businesses or assets that we have sold could adversely affect our financial resultsNew
Other Accendra Health 10-Ks
- FY2024 10-K risk factors50 risks
Accendra Health depends heavily on Vizient, Premier, and HPG GPOs for 65% of net revenue. The company carries $1.9 billion in debt and faces integration and pending risks regarding the Rotech acquisition and potential sale of its Products & Healthcare Services segment.
Filed Feb 28, 2025
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.