NUTX 10-K & 10-Q changes, risk factors and insider trading
Nutex Health Inc. · Nasdaq · Services-Business Services, Nec · CIK 1479681 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “Summary of Risk Factors”
New heading “Risks Related to Nutex Health Inc.”
New heading “Regulatory and litigation uncertainty under the No Surprises Act may reduce our cash collections and increase dispute costs.”
New heading “Our third party provider in the federal and state arbitration process, HaloMD, has been, and may in the future be, subject to lawsuits filed by health insurance providers, which may have an adverse impact on our revenues, reputation, financial condition and the trading price of our common stock.”
New heading “Our obligation to issue additional shares of our common stock to former doctor owners of under construction hospitals may cause significant dilution of the voting power of our current stockholders.”
New heading “Short sellers of our stock may be manipulative and may drive down the market price of our common stock.”
New heading “We may be subject to risks of litigation and disputes.”
New heading “If we are unable to maintain an effective system of disclosure controls and procedures and internal controls over financial reporting, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect our results of operations, our stock price and investor confidence in our company.”
New heading “New California privacy regulations require Automated Decision-Making Technology (“ADMT”) transparency and future cybersecurity audits.”
New heading “Heightened scrutiny of Medicare Advantage risk-adjustment practices may increase audit and repayment risk.”
New heading “Changes to Stark Law DHS codes and exception thresholds may increase compliance risk.”
New heading “HIPAA rule changes may require operational and documentation updates and raise enforcement exposure.”
New heading “Escalating cyber threats and regulatory expectations may increase costs and disruption risk.”
Removed heading “For the year ended December 31, 2024, we identified material weaknesses in our internal control over financial reporting. If our internal control over financial reporting is not effective, we may not be able to accurately report our financial results or file our periodic reports in a timely manner, which may cause adverse effects on our business and may cause investors to lose confidence in our reported financial information and may lead to a decline in the price of our Common Stock.”
Removed heading “The laws and regulations applicable to public companies are complex and may require an increasing amount of our management’s time and increase staffing and compliance costs.”
Removed heading “Our business and the markets in which we operate are new and rapidly evolving, which makes it difficult to evaluate our prospects and the risks and challenges we may encounter.”
Removed heading “Recovery of certain out of network claims under the arbitration process is subject to change, and our arbitration success rate could be subject to a significant and sustained decline.”
Removed heading “Any future litigation against us could be costly and time-consuming to defend.”
Removed heading “We could incur substantial costs in protecting or defending our intellectual property rights, and any failure to protect our intellectual property could adversely affect our business, results of operations and financial condition.”
Removed heading “Assertions by third parties of infringement or other violations by us of their intellectual property rights could result in significant costs and harm our business and operating results.”
Removed heading “The information that we expect to provide to our clients could be inaccurate or incomplete, which could harm our business reputation, financial condition, and results of operations.”
Removed heading “Our proprietary applications may not operate properly, which could damage our reputation, give rise to a variety of claims against us, or divert our resources from other purposes, any of which could harm our business and operating results.”
Removed heading “General Risk Factors”
Removed heading “We will continue to incur significantly increased costs and devote substantial management time as a result of operating as a public company.”
Removed heading “We are obligated to develop and maintain proper and effective internal control over financial reporting in order to comply with Section 404 of the Sarbanes-Oxley Act. We may not complete our analysis of our internal control over financial reporting in a timely manner, or these internal controls may not be determined to be effective, which may adversely affect investor confidence in us and, as a result, adversely affect the value of our Common Stock.”
Largest changes
“From time to time, we have been and may become involved in disputes and litigation with former doctor owners, stockholders, government and regulatory agencies or other parties. Such actions could result in the imposition of various remedies such as injunctions or monetary damages, which if awarded could materially and adversely harm our business, subject us to substantial defense costs and expenses, and divert resources and the attention of management from our business. …”see in full comparison
“In addition, following the publication of short seller reports, companies targeted by these short seller publications have sometimes faced securities class action litigation against the company as a result. Additionally, allegations made by short sellers, whether substantiated or not, could result in investigations by regulators, including the Securities and Exchange Commission. If we were subject to such investigations as a result of such allegations, we could incur substantial costs defending the Company from the lawsuit or such investigation. …”see in full comparison
“For the year ended December 31, 2024, we identified material weaknesses in our internal control over financial reporting. If our internal control over financial reporting is not effective, we may not be able to accurately report our financial results or file our periodic reports in a timely manner, which may cause adverse effects on our business and may cause investors to lose confidence in our reported financial information and may lead to a decline in the price of our Common Stock.”see in full comparison
The 21st Century Cures Act, or the Cures Act, which was passed and signed into law in December 2016, includes provisions related to data interoperability, information blocking and patient access. In March 2020, the U.S. Department of Health and Human Services, or HHS, Office of the National Coordinator for Health Information Technology, or ONC, and CMS finalized and issued complementary rules that are intended to clarify provisions of the Cures Act regarding interoperability and information blocking, and include, among other things, requirements surrounding information blocking, changes to ONC’s health IT certification program and requirements that CMS regulated payors make relevant claims/care data and provider directory information available through standardized patient access and provider directory application programming interfaces that connect to provider electronic health record systems. The companion rules will transform the way in which healthcare providers, health IT developers, health information exchanges/health information networks, or HIEs/HINs, and health plans share patient information, and create significant new requirements for healthcare industry participants.see in full comparisonFor example, the ONC rule, which went into effect on April 5, 2021, prohibits healthcare providers, health IT developers of certified health IT, and HIEs/HINs from engaging in practices that are likely to interfere with, prevent, materially discourage, or otherwise inhibit the access, exchange or use of electronic health information, or EHI, also known as “information blocking.” To further support access and exchange of EHI, the ONC rule identifies eight “reasonable and necessary activities” as exceptions toHeightened information blockingactivities,enforcementasmaylongresultasinspecificpenaltiesconditionsandarereimbursementmet.disincentives.AnyHHSfailurehas directed OIG and ONC tocomplyactivelywithenforcetheseinformation-blockingrulesregulations. Civil monetary penalties up to $1 million per violation apply to certain entities; provider disincentives (including negative MIPS adjustments and MSSP impacts) became effective during 2024–2025. Investigations or adverse findings couldhaveleadatomaterialfinancialadversepenalties,effectreputationalon our business, results of operationsharm, andfinancialoperationalcondition.remediation costs.
“Our third party provider in the federal and state arbitration process, HaloMD, has been, and may in the future be, subject to lawsuits filed by health insurance providers, which may have an adverse impact on our revenues, reputation, financial condition and the trading price of our common stock.”see in full comparison
“•We may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and stock price, which could cause you to lose some or all of your investment.”see in full comparison
Full comparison: every changed paragraph (214)
Our business, financial condition, and operating results are affected by a number of factors, whether currently known or unknown, including risks specific to us or the healthcare industry, as well as risks that affect businesses in general. The risks disclosed in this Annual Report could materially adversely affect our business, financial condition, cash flows, or results of operations and thus our stock price. These risk factors may be important to understanding other statements in this Annual Report and should be read in conjunction with the consolidated financial statements and related notes in Part I,II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Part I,II, Item 8, “Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. These disclosures reflect the Company’s beliefs and opinions as to factors that could materially and adversely affect the Company and its securities in the future. References to past events are provided by way of example only and are not intended to be a complete listing or a representation as to whether or not such factors have occurred in the past or their likelihood of occurring in the future. Because of such risk factors, as well as other factors affecting the Company’s financial condition and operating results, past financial performance shouldmay not be considered to be a reliable indicator ofreflect future performance, and investors should not use historical trends to anticipate results or trends in future periods.
Summary of Risk Factors
This summary provides an overview of the risks we face and should not be considered a substitute for the comprehensive discussion of risk factors discussed immediately following this summary.
•Regulatory and litigation uncertainty under the No Surprises Act may reduce our cash collections and increase dispute costs.
•Our third-party provider in the federal and state arbitration process, HaloMD, has been, and may in the future be, subject to lawsuits filed by health insurance providers, which may have an adverse impact on our reputation, financial condition and the trading price of our common stock.
•Sales of a substantial amount of our Common Stock by our stockholders, or the perception that such sales could occur, could cause the price of our Common Stock to fall.
•Our obligation to issue additional shares of our common stock to former doctor owners of under construction hospitals may cause significant dilution of the voting power of our current stockholders.
•Short sellers of our stock may be manipulative and may drive down the market price of our common stock.
•We may be subject to risks of litigation and disputes.
•If we are unable to maintain an effective system of disclosure controls and procedures and internal controls over financial reporting, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect our results of operations, our stock price and investor confidence in our company.
•We may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and stock price, which could cause you to lose some or all of your investment.
•Our current business plans require a significant amount of capital. If we are unable to generate sufficient cash from operations, borrow money on commercially reasonable terms, or sell equity at reasonable values, we may not be able to execute our business plans and our prospects, financial condition and results of operations could be materially adversely affected.
•We may decide to close underperforming hospitals which may result in a temporary decrease in overall revenues.
•We may experience difficulties in managing our growth and expanding our operations.
Risks Related to Our Business and Industry
•Reimbursement methodology and timing for our medical services is subject to change, and the reimbursement amount that we receive for emergency services could be subject to a significant and sustained decline.
•The estimates and assumptions we are required to make in connection with the preparation of our financial statements may prove to be inaccurate.
•Public health emergencies could negatively affect our operations, business and financial condition, and our ability to generate revenue could be negatively impacted if the U.S. economy remains unstable for a significant amount of time.
•We rely on our management team and key employees and our business, financial condition, cash flows and results of operations could be harmed if we are unable to retain qualified personnel.
•Our growth depends in part on our ability to identify and develop successful hospitals in new geographies, physician partners and patients. If we are not able to successfully execute upon our growth strategies, there may be a material adverse effect on our business, financial condition, cash flows and results of operations.
•In his capacity as the co-owner of the real estate entities that lease the land and buildings to our hospital facilities, Dr. Vo, our Chairman, CEO and major stockholder, may have conflicts of interest with the Company and its public stockholders.
•If the estimates and assumptions we use to project the size, revenue or medical expense amounts of hospitals in our target geographies are inaccurate or the cost of providing services exceeds the amounts received by us, our future growth prospects may be impacted, and we may generate losses or fail to attain financial performance targets.
•We primarily depend on reimbursement by third-party payors, as well as payments by individuals, which could lead to delays and uncertainties in the timing and process of reimbursement, including any changes or reductions in Medicare reimbursement rates or rules.
•Our business and growth strategy depend on our ability to maintain and expand facilities staffed with qualified physicians. If we are unable to do so, future growth would be limited and our business, operating results and financial condition would be harmed.
•If any of our physician partners lose their regulatory licenses, permits and/or accreditation status, or become ineligible to receive reimbursement under Medicare or Medicaid or from other third-party payors, there may be a material adverse effect on our business, financial condition, cash flows, or results of operations.
•We are dependent on our physicians and other healthcare professionals to effectively manage the quality and cost of care.
•We operate in a competitive industry, and if we are not able to compete effectively, our business, financial condition and results of operations will be harmed.
•Developments affecting spending by the healthcare industry could adversely affect our business.
•We and our physician partners and other healthcare professionals may become subject to medical liability claims, which could cause us to incur significant expenses and may require us to pay significant damages if the claims are not covered by insurance.
•If we or our partner physicians or other healthcare providers fail to comply with applicable data interoperability and information blocking rules, our consolidated results of operations could be adversely affected.
•Our business and operations could suffer in the event of material information technology system failures, security breaches, or other deficiencies in cybersecurity.
•Actual or perceived failures to comply with applicable data protection, privacy and security laws, regulations, standards and other requirements, including contractual obligations, could adversely affect our business, financial condition and results of operations.
•Changes in U.S. tax laws, and the adoption of tax reform policies could adversely affect our operating results and financial condition.
•Our quarterly results may fluctuate significantly, which could adversely impact the value of our Common Stock.
•Obligations under the term loans of our hospitals, and our related loan and leases guarantees could restrict our operations, particularly our ability to respond to changes in our business or to take specified actions. An event of default under the term loans could harm our business, and creditors having security interests over the hospital assets as well as the leased real estate would be able to foreclose on such assets.
•The arrangements we have with our VIEs are not as secure as direct ownership of such entities.
•Any failure by our affiliated entities or their owners to perform their obligations under their agreements with us would have a material adverse effect on our business, results of operations and financial condition.
•If there is a change in accounting principles or the interpretation thereof affecting consolidation of VIEs, it could impact our consolidation of total revenues derived from our affiliated physician groups.
Risk Related to our Population Health Management Division
•New physicians and other providers must be properly enrolled in governmental healthcare programs before we can receive reimbursement for their services, and there may be delays in the enrollment process.
•We may have difficulty collecting payments from third-party payors in a timely manner.
•Decreases in payor rates could adversely affect us.
•Federal and state laws may limit our ability to collect monies owed by patients.
•We have established reserves for our potential medical claim losses, which are subject to inherent uncertainties, and a deficiency in the established reserves may lead to a reduction in our assets or net incomes.
•We do not have a Knox-Keene license.
•If our affiliated physician group is not able to satisfy California financial solvency regulations, they could become subject to sanctions and their ability to do business in California could be limited or terminated.
•Primary care physicians may seek to affiliate with our and our competitors’ IPAs at the same time.
•If we inadvertently employ or contract with an excluded person, we may face government sanctions.
•New California privacy regulations require Automated Decision-Making Technology (“ADMT”) transparency and future cybersecurity audits.
•Heightened scrutiny of Medicare Advantage risk-adjustment practices may increase audit and repayment risk.
Risks Related to Our Legal and Regulatory Environment
•We conduct business in a heavily regulated industry and if we fail to adhere to all of the complex government laws and regulations that apply to our business, we could incur fines or penalties or be required to make changes to our operations or experience adverse publicity, any or all of which could have a material adverse effect on our business, results of operations, financial condition, cash flows, and reputation.
•If any of our hospitals lose their regulatory licenses, permits and/or registrations, as applicable, or become ineligible to receive reimbursement from third-party payors, there may be a material adverse effect on our business, financial condition, cash flows, or results of operations.
•If our arrangements with our partner physicians and other physician partners are found to constitute the improper rendering of medical services or fee splitting under applicable state laws, our business, financial condition and our ability to operate in those states could be adversely impacted.
•We face inspections, reviews, audits and investigations under federal and state government programs and contracts. These audits could have adverse findings that may negatively affect our business, including our results of operations, liquidity, financial condition and reputation.
•Recent healthcare regulations, and other changes in the healthcare industry and in healthcare spending may adversely affect our business, financial condition and results of operations.
•Changes to Stark Law DHS codes and exception thresholds may increase compliance risk.
•HIPAA rule changes may require operational and documentation updates and raise enforcement exposure.
•Escalating cyber threats and regulatory expectations may increase costs and disruption risk.
Risks Related to Our Common Stock
Management's Discussion & Analysis (MD&A)
New heading “Year Ended December 31, 2025 Compared to Year Ended December 31, 2024”
New heading “Year Ended December 31, 2024 Compared to Year Ended December 31, 2023”
New heading “Income tax expense.”
New heading “Selected Quarterly Financial Data”
Removed heading “Explanatory Note”
Removed heading “Year December 31, 2024 Compared to Year December 31, 2023”
Removed heading “Year Ended December 31, 2023 Compared to Year Ended December 31, 2022”
Largest changes
“During 2025, the Company determined that its previously issued consolidated financial statements for the year ended December 31, 2024 required restatement. The restatement primarily related to the reclassification of non-cash stock-based compensation obligations associated with under-construction and ramping hospitals from equity to liabilities, based on the applicable classification criteria under ASC 718, Compensation—Stock Compensation, and ASC 480, Distinguishing Liabilities from Equity. …”see in full comparison
“Corporate and other costs. Corporate and other costs in 2025 included general and administrative expenses totaling $51.7 million and stock-based compensation of $117.0 million. Our stock-based compensation expense in the form of one-time obligations paid in common stock to qualifying under construction and ramping hospitals increased by $100.4 million. Our corporate costs for 2024 included general and administrative costs of $41.9 million, a non-cash impairment charge of $7.1 million and stock-based compensation of $16.6 million. …”see in full comparison
“Goodwill Impairment. We test goodwill for impairment at least annually by first performing a qualitative assessment to determine whether a quantitative goodwill test is necessary or by electing to forgo the qualitative assessment and perform the quantitative goodwill test. For the year ended December 31, 2025, the Company elected to perform a qualitative assessment of goodwill. Upon performing the qualitative assessment of goodwill, qualitative factors are assessed to determine whether it is more likely than not that the fair value is less than the carrying amount. …”see in full comparison
“Corporate and other costs. Corporate and other costs in 2023 included general and administrative expenses totaling $33.2 million, impairment losses of $30.2 million due to facility closures and stock-based compensation of $2.2 million. Our corporate costs for 2022 included general and administrative costs of $19.8 million, acquisition costs for the reverse business combination with Clinigence totaling $3.9 million and a non-cash impairment charge reducing goodwill totaling $398.1 million. …”see in full comparison
“During the three months ended September 30, 2022, we determined that the estimated fair value of our population health management division reporting unit which was acquired in the reverse business combination with Clinigence was less than its carrying value. Therefore, we conducted a second step of the goodwill impairment test to determine the implied fair value of the reporting unit’s goodwill. In this analysis, we allocated the fair value of the reporting unit to identifiable assets and liabilities of the reporting unit. …”see in full comparison
Construction in Progress. The Company regularly is in the process of constructing new facilities. Generally, our hospital facilities are responsible for the leaseholdsee in full comparisonbuildoutbuild out and equipment while the associated Real Estate Entity procures the land, if any, and constructs a new or remodeled facility. Costs incurred to construct assets which will ultimately be classified as fixed assets are capitalized and classified in our financial statements as construction in progress until construction is completed and the asset is available for use. Once the asset is available for use, it is reclassified as another category of fixed assets and depreciated across its useful life. Goodwill Impairment. We test goodwill for impairment at least annually by comparing the estimated fair values of our reporting units to their respective carrying values. We use an income method to estimate the fair value of these assets, which is based on forecasts of the expected future cash flows attributable to the respective assets. Significant estimates and assumptions inherent in the valuations reflect a consideration of other marketplace participants and include the amount and timing of future cash flows (including expected growth rates and profitability). Estimates utilized in the projected cash flows include consideration of macroeconomic conditions, overall category growth rates, competitive activities, Company business plans and the discount rate applied to the cash flows. Unanticipated market or macroeconomic events and circumstances may occur, which could affect the accuracy or validity of the estimates and assumptions.
Full comparison: every changed paragraph (109)
Explanatory Note
On April 1, 2022, Nutex Health Holdco LLC merged with Clinigence Holdings, Inc., a publicly traded Delaware corporation, which was renamed Nutex Health Inc. after the merger. Immediately prior to the merger, holders of 84% of the aggregate equity interests in subsidiaries and affiliates of Nutex Health Holdco LLC contributed these ownership interests to Nutex Health Holdco LLC in exchange for Nutex Health Holdco LLC equity interests. Immediately thereafter, in the merger, each unit representing an equity interest in Nutex Health Holdco LLC was converted into the right to receive shares of common stock of Clinigence Holdings, Inc. (n/k/a Nutex Health, Inc.).
The Merger was accounted for as a reverse business combination under U.S. GAAP. Therefore, Nutex Health Holdco LLC was treated as the accounting acquirer in the merger. Beginning with the second quarter of 2022, our financial statements are presented on a consolidated basis and include Clinigence.
Except where the context indicates otherwise, (i) references to “we,” “us,” “our,” or the “Company” refer, for periods prior to the completion of the merger, to Nutex Health Holdco LLC and its subsidiaries, (ii) references the “Nutex Health” for periods following the completion of the merger, refer to Nutex Health Inc. and its subsidiaries and (ii) references to “Clinigence” refer to Clinigence Holdings, Inc. and its subsidiaries prior to the completion of the merger.
At December 31, 2024,2025, we employed approximately 800944 full-time employees, contracted 255more than 280 doctors at our facilities and partnered with over 2,1003,600 physicians within our networks. Our corporate headquarters is based in Houston, Texas. We were incorporated on April 13, 2000 in the state of Delaware.
The hospital division includes our healthcare billing and collections organization and hospital entities. In addition, we have financial and operating relationships with multiple professional entities (the “Physician LLCs”) and real estate entities (the “Real Estate Entities”). The Physician LLCs employ the doctors who work in our hospitals. These entitiesPhysician LLCs are consolidated by the Company as VIEs because they do not have significantsufficient equity at risk,risk to finance their activities independently. The Company is considered the primary beneficiary of these entities because (i) it has the power to direct the activities that most significantly affect their economic performance through its contractual and weoperational haveoversight, historicallyand provided(ii) it has the obligation to absorb losses and the right to receive benefits that could be significant, as evidenced by the Company’s historical practice of providing financial support toduring the Physician LLCs in the eventperiods of cash shortagesshortfall and receivedreceiving the benefit of their cash surpluses.services.
The Real Estate Entities own the land and hospital buildings which are leased to our hospital entities. The Real Estate Entities have mortgage loans payable to third parties which are collateralized by the land and buildings. We consolidate the Real Estate Entities as VIEs in instances where our hospital entities are guarantors or co-borrowers under their outstanding mortgage loans. Since the second quarterAs of 2022,December we31, deconsolidated2025, 18two Real Estate Entities aftercontinue theto third-party lenders released our guarantees of associated mortgage loans, leaving three Real Estate Entities as current VIEsbe consolidated in our financial statements.statements as VIEs.
The Company has no direct or indirect ownership interest in the Physician LLCsLLCs. The Company has no direct or indirect interests in the Real Estate Entities,Entities except for the two noted above and a 51% ownership in the May 2025 Acquiree (see Note 3 - Mergers, Acquisitions and Divestitures), so 100% of the equity for these entities is shown as noncontrolling interest in the consolidated balance sheets and statements of operations.
The population health management division includes our management services organizations. In addition, AHISP,Atlas IPA,Healthcare Physicians (“Atlas”, formerly known as “Associated Hispanic Physicians of So. California”), a physician-affiliated entity that is not owned by us—is consolidated as a VIE of our wholly-owned subsidiary AHP since we are the primary beneficiary of their operations under AHP’s management services contracts with them.
We receive payment for facility services rendered by us from federal agencies, private insurance carriers, and patients. The Physician LLCs receive payment for doctor services from these same sources. On average, greater than 90%99% of our net patient service revenue is paid by insurers, federal agencies, and other non-patient third parties. The remaining revenues are paid by our patients in the form of copays, deductibles, and self-payment. We generally operate as an out-of-networkout-of-network provider and, as such, do not have negotiated reimbursement rates with insurance companies.
The population health management division recognizes revenue for capitation and management fees for services to IPAs.IPAs monthly. Capitation revenue consists primarily of capitated fees for medical services provided by physician-owned entities we consolidate as VIEs. Capitated arrangements are made directly with various managed care providers including HMOs. Capitation revenues are typically prepaid monthlypaid to us monthly in the period services are provided based on the number of enrollees selecting us as their healthcare provider. Capitation is a fixed payment amount per patient per unit of time paid in advance for the delivery of health care services, whereby the service providers are generally liable for excess medical costs. We receive management fees that are based on gross capitation revenues of the IPAs or physician groups we manage.
Our growth strategy. We plan to expand our operations by expanding our clinical services at our existing facilities, by entering new market areas either through development of new hospitals, formation of new IPAs or by making acquisitions. We expect to open three new hospital facilities by the end of the year 2025.2026. These facilities are either under construction or in advanced planning stages. We anticipate launching one-to-three additional IPAs per year, principally in geographic areas around our existing micro-hospitals.
•Regulatory uncertainty;
•A growing focus on healthcare spending by consumers, employers and insurers, who are actively seeking lower-cost care solutions;
•A shift in patient volumes from inpatient to outpatient settings due to technological advancements and demand for care that is more convenient, affordable and accessible;
•The growing aged population, which requires greater chronic disease management and higher-acuity treatment; and
•Ongoing consolidation of providers and insurers across the healthcare industry.
Following is our results of operations for the periods shown (in thousands):
Year Ended December 31, 2025 Compared to Year Ended December 31, 2024
Year December 31, 2024 Compared to Year December 31, 2023
We reported net income attributable to Nutex Health Inc. of $70.8 million, or earnings of $10.48 per share, for 2025 as compared with a net income attributable to Nutex Health Inc. of $52.2$52.1 million, or earnings of $9.71$9.69 per share, for 2024 as compared with a net loss attributable to Nutex Health Inc. of $45.8 million, or a loss of $10.39 per share, for 2023.2024. Our 20242025 results were principally affected by:
•Patient visits rose by 11.8% for the year ended December 31, 2025, compared to the same period in 2024. Mature hospitals experienced an average visit growth of 1.3% year-over-year, alongside the impact of two new hospital openings in 2025.
•Increased revenue per visit due to success in efforts to obtain higher rates through the Independent Dispute Resolution ("IDR") process and increased utilization of higher paid services such as increased observation and in-patient stays.
•Higher stock-based compensation in the form of one-time obligations of earn-out shares issuable to qualifying under construction and ramping hospitals of $117.0 million for 2025, an increase of $100.4 million compared to 2024.
•Higher income tax expense of $64.4 million for 2025, an increase of $49.3 million compared to 2024.
•Higher other expenses of $8.6 million for 2025 compared to income of $0.7 million for 2024. The increased expenses for 2025 related primarily to distributions to ramping hospitals' partners.
Hospital Division. Our revenue for 2025 totaled $844.2 million as compared to $449.1 million for 2024, an increase of $395.1 million, or 88%. Our revenue for 2025 was positively affected by an increase in revenue per visit due to success in efforts to obtain higher rates through the IDR process, an increase in visits and increased utilization of higher paid services such as increased observation and in-patient stays. The following table shows the number of patient visits during the periods:
Effective May 1, 2024, we engaged HaloMD, a third-party IDR vendor, to further support our out of network claims appeals and determine which claims would be beneficial to arbitrate. The IDR process can take up to three to five months to receive payments relative to the start of a claim’s open negotiation process. In order to facilitate the dispute arbitration process, the Company incurred fees to the Centers for Medicare and Medicaid Services (“CMS”), the organizations that arbitrate the payment amount between the plan and providers (“IDRE”), and commission and fees to the third-party IDR vendor. Total accrued arbitration expenses were $49.7 million and $47.7 million as of December 31, 2025 and 2024, respectively.
For these reasons, in 2024 we refined our estimates of variable consideration and revenue recognition timing, particularly to claims subject to arbitration. The new methodology incorporates historical arbitration outcomes, payment history, and expected resolution timing in determining the expected transaction price for applicable claims. The result of this change in estimate increased our estimate of the ultimate amounts of accounts receivable we will collect for the current and prior periods. This change in estimate increased revenue and net income before tax for the year ended December 31, 2024 by approximately $169.7 million and $112.0 million, respectively.
The hospital division’s operating income was $444.0 million during 2025, increase of 127% as compared to $195.5 million in the same period of 2024. Our operating income for 2025 was positively affected by an increase in net revenue as noted above. Our contract services expense increased by $89.6 million primarily due to the cost associated with the IDR process. Our payroll expense increased by $40.6 million due to the opening of two facilities in 2025 as well as due to the accrual of bonus payable in 2026.
Population Health Management Division. We completed our reverse business combination with Clinigence in April 2022. Legacy Clinigence’s operations are reported as the population health management division. Our total revenue for 2025 for this division was $31.1 million consisting of capitation revenue of $28.1 million and management fees of $3.0 million. Capitation revenue is recognized by our consolidated VIE, Atlas. We do not have an equity interest in this VIE but consolidate it since we are the primary beneficiary of its operations under our management services contract with them. We also earn management fees under our management services contracts with other IPAs and MSOs which are reported as revenue.
The population health management division had $0.7 million of operating income for 2025 driven by significant membership growth and the higher claims experience associated with newly enrolled members.
Real Estate Division. This division reports on the operations of consolidated Real Estate Entities where we provide guarantees of their indebtedness or are co-borrowers. During 2023, we deconsolidated one Real Estate Entity after the third-party lenders released our guarantees of associated mortgage loans. As of December 31, 2025, we provided guarantees to the indebtedness of two Real Estate Entities.
On May 2, 2025, the Company acquired a 51% membership interest in an Indiana-based limited liability company (“May 2025 Acquiree”) for $2.3 million in cash. Due to the assumption of the note payable, interest expense was $0.2 million for the year ended December 31, 2025.
On December 17, 2025, the Company acquired land and an office building, together with related contractual rights, including existing tenant lease agreements and certain service contracts pursuant to an asset purchase agreement, for $2.2 million in cash. The Company recognized rental income of $0.1 million, which is included in the hospital division revenue line item in the consolidated statements of operations, and $0.2 million in operating expenses for the year ended December 31, 2025.
Corporate and other costs. Corporate and other costs in 2025 included general and administrative expenses totaling $51.7 million and stock-based compensation of $117.0 million. Our stock-based compensation expense in the form of one-time obligations paid in common stock to qualifying under construction and ramping hospitals increased by $100.4 million. Our corporate costs for 2024 included general and administrative costs of $41.9 million, a non-cash impairment charge of $7.1 million and stock-based compensation of $16.6 million. General and administrative costs increased $9.7 million attributed to increases in accrued bonus expense and payroll of $4.5 million, audit and audit-related fees associated with the restatement of our 2024 financial statements of $2.3 million, recruiting fees of $1.4 million, and other professional and IT expenses of $1.4 million.
Interest expense. Interest expense totaled $22.2 million in 2025 as compared with $19.9 million for 2024. The increase in interest expense is primarily due to leases entered into throughout 2024 that are fully operating in 2025, and due to leases entered into in 2025 for the opening of two facilities throughout the year.
Income tax expense. As of December 31, 2025 the Company fully utilized its federal and state net operating losses. As of December 31, 2025 and 2024, the Company had a capital loss carryforward of $0.2 million and $4.5 million, respectively. Due to the uncertainty about the Company's ability to utilize the capital loss prior to the expiration date, the Company maintained a valuation allowance against that deferred tax asset as of December 31, 2024. The expired capital loss was written off and the corresponding valuation allowance was reversed as of December 31, 2025.
Year Ended December 31, 2024 Compared to Year Ended December 31, 2023
We reported a net income attributable to Nutex Health Inc. of $52.1 million, or earnings of $9.69 per share, for 2024 as compared with a net loss attributable to Nutex Health Inc. of $45.8 million, or a loss of $10.39 per share, for 2023. Our 2024 results were principally affected by:
•Revenue growth of approximately $169.7 million was primarily driven by successful participation in arbitration through the IDR process under the No Surprises Act ("NSA").
•Increased revenue was also attributed to higher utilization of more complex clinical services, including increased observation and in-patient stays.
•Patient visits rose by 16.9% for the year ended December 31, 2024, compared to the same period in 2023. Mature hospitals experienced an average visit growth of 6.5% year-over-year, alongside the impact of four new hospital openings in 2024.
•Our operating expenses increased primarily due the revenue generated from the IDR process in addition to the opening of new facilities and volume growth.
Adjusted EBITDA for 2024 was $102.8 million as compared to $(5.8) million for 2023. Refer to Non-GAAP Financial Measures discussed below for a definition and reconciliation of Adjusted EBITDA.
OnEffective JulyMay 1, 2024, we engaged with a third-party IDR vendor to further support our out of network claims appeals and determine which claims would be beneficial to arbitrate. The IDR process can take up to three to five months to receive payments relative to the start of a claim’s open negotiation process. In order to facilitate the dispute arbitration process, the Company incurred fees to the Centers for Medicare and Medicaid Services (“CMS”), the organizations that arbitrate the payment amount between the plan and providers (“IDRE”), and commission and fees to the third-party IDR vendor. Total accrued arbitration expenses are $47.7 million as of December 31, 2024.
For these reasons, we refined our estimates of variable consideration and revenue recognition timing, particularly to claims subject to arbitration. Our methodology now incorporates historical arbitration outcomes, payorpayment behavior,history, and expected resolution timing in determining the expected transaction price for applicable claims. The result of this change in estimate increased our estimate of the ultimate amounts of accounts receivable we will collect for the current and prior periods. This change in estimate increased revenue and net income before tax for the year ended December 31, 2024 by approximately $169.7 million and $112.0 million, respectively.
The hospital division’s operating income was $195.5 million during 2024, up 438.0%438.1% as compared to $36.3 million in the same period of 2023. Our operating income for 2024 was positively affected by an increase in net revenue as noted above. Our contract services expense increased $57.6 million due to the cost associated with the IDR process. Our payroll expense increased due to the opening of four facilities in 2024 as well as due to the accrual of bonus payable in 2025. Our operating income was adversely impacted by $4.1$8.4 million from the opening of four new hospital locations in 2024. Start-up and operating expenses at new facilities often exceed our revenue at these facilities until they achieve stabilized volumes of patient visits.
Population Health Management Division. We completed our reverse business combination with Clinigence in April 2022. Legacy Clinigence’s operations are reported as the population health management division. Our total revenue for 2024 for this division was $30.9 million consisting of capitation revenue of $27.8 million, management fees of $2.1 million and SaaS revenue of $1$1.0 million. The increase in revenue is attributed to increases in capitation revenue in 2024. Capitation revenue is recognized by our consolidated VIE, AHISP.Atlas. We do not have an equity interest in this VIE but consolidate it since we are the primary beneficiary of its operations under our management services contract with them. We also earn management fees under our management services contracts with other IPAs and MSOs which are reported as revenue.
Real Estate Division. This division reports on the operations of consolidated Real Estate Entities where we provide guarantees of their indebtedness or are co-borrowers. During the second quarter of 2022, we deconsolidated 17 Real Estate Entities after the third-party lenders released our guarantees of associated mortgage loans. During 2023, we deconsolidated one Real Estate Entity after the third-party lenders released our guarantees of associated mortgage loans. As of December 31, 2024, we provided guarantees to the indebtedness of two Real Estate Entities.
Corporate and other costs. Corporate and other costs in 2024 included general and administrative expenses totaling $41.9 million, impairment losses of assets and goodwill of $7.1 million due to facility closures and stock-based compensation of $16.6 million. Our corporate costs for 2023 included general and administrative costs of $33.2 million, a non-cash impairment charge of $30.2 million and stock-based compensation of $2.8 million. General and administrative costs increased $8.6 million attributed to increases in accrued bonus expense ($2.7 million), professional services ($2.3 million), insurance expense ($2.3 million) and in other ($1.3 million).
As a public company, we must comply with new laws, regulations and requirements, certain corporate governance provisions of the Sarbanes-Oxley Act of 2002, related regulations of the SEC and the continued listing requirements of the NASDAQ, with which we were not required to comply with as a private company. We incur additional annual expenses related to these matters and, among other things, additional directors’ and officers’ liability insurance, director fees, reporting requirements of the SEC, transfer agent fees, hiring additional accounting, legal and administrative personnel, increased auditing and legal fees and similar expenses.
Interest expense. Interest expense totaled $19.9 million in 2024 as compared with $16.3 million for 2023. The increase in interest expense is primarily due to leases entered into in 2024 for the opening of four facilities throughout the year.
Income tax expense.
Income tax expense. In periods before our merger with Clinigence, Nutex Health Holdco LLC and the Nutex Subsidiaries were pass-through entities treated as partnerships for U.S. federal income tax purposes. No provision for federal income taxes was provided for these periods as federal taxes were obligations of these companies’ members. After the merger, Nutex Health Holdco LLC became a wholly-owned subsidiary of Clinigence and is included in its consolidated corporate tax filings. We recognized a non-cash charge of $21.3 million to income tax expense during 2022 for the change in tax status of Nutex Health Holdco LLC. This charge provides for the accumulated net deferred tax liabilities representing the differences between the book and tax bases of Nutex Health Holdco LLC’s assets and liabilities as of the April 1, 2022 change in tax status.
At the time of our merger with Clinigence, Clinigence had a full valuation allowance against its deferred tax assets. For the year ended December 31, 2022 we recorded a non-cash benefit of $2.4 million to income tax expense to remove the acquired valuation allowance after we concluded that the associated deferred tax assets would be realizable.
As of December 31, 2023, a valuation allowance was established against the net deferred tax asset because the Company determined it was more likely than not that future earnings would not be sufficient to realize the corresponding tax benefits. In determining the appropriate valuation allowance, the Company considered the projected realization of tax benefits based on expected levels of future taxable income, available tax planning strategies and reversals of existing taxable temporary differences.
As of December 31, 2024, we recorded a non-cash benefit of $6.5 million to income tax expense to remove the majority of the valuation allowance after we concluded that the associated deferred tax assets would be realizable. In determining the appropriate valuation allowance, the Company considered its net cumulative earnings (adjusted for permanent items) for the last three years, along with the change to its business related to the higher revenue estimates without impacting its existing cost structure. $1.0M valuation allowance remains to offset the deferred tax asset related to capital loss carryforwards that the company does not expect to realize.
Each of the discrete items above, as well as the non-deductible goodwill impairment expense recognized in 2024, 2023 and 2022, are one-time, non-cash items.
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022
What changed in the latest 10-Q
Risk Factors
New heading “The Implementation of the Federal Independent Dispute Resolution process has, and may continue in the future, result in significant volatility in our quarterly financial results and materially adversely affect the trading price of our common stock.”
New heading “Certain former doctor owners dispute the number of shares issuable to them under the earn out formula approved in connection with the merger.”
Removed heading “Our obligation to issue additional shares of our common stock to former doctor owners of under construction hospitals may cause significant dilution of the voting power of our current stockholders.”
Largest changes
“The Implementation of the Federal Independent Dispute Resolution process has, and may continue in the future, result in significant volatility in our quarterly financial results and materially adversely affect the trading price of our common stock.”see in full comparison
“Our obligation to issue additional shares of our common stock to former doctor owners of under construction hospitals may cause significant dilution of the voting power of our current stockholders.”see in full comparison
“Certain former doctor owners dispute the number of shares issuable to them under the earn out formula approved in connection with the merger.”see in full comparison
“We recognize revenue at the time of service based on the estimated transaction price we expect to receive from third-party payers. We apply Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 606 – Revenue from Contracts with Customers in making estimates of our earned revenue and accounts receivable at each reporting date. …”see in full comparison
“With respect to two additional hospitals with an initial 24-month operational period expiring on or prior to December 31, 2026, we estimate, based on current expectations, to issue approximately 47,100 additional shares, or 0.7% of our issued and outstanding shares as of March 31, 2026 (including shares subject to issuance pursuant to the earn out and accrued as of such date). See Part I - Item 1 – Notes to Condensed Consolidated Financial Statements (unaudited) – Note 11. …”see in full comparison
“Due to the ongoing operational volatility of the IDR framework and the implementation of these portal modifications, there is inherent uncertainty regarding the ultimate timing and impact of these updates on our financial results. Revenue associated with these estimates is recognized as information becomes available during the normal course of the claims adjudication process, which may result in fluctuations in patient revenue between the period services are rendered and the period related adjustments are recorded. …”see in full comparison
Full comparison: every changed paragraph (9)
The Implementation of the Federal Independent Dispute Resolution process has, and may continue in the future, result in significant volatility in our quarterly financial results and materially adversely affect the trading price of our common stock.
We recognize revenue at the time of service based on the estimated transaction price we expect to receive from third-party payers. We apply Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 606 – Revenue from Contracts with Customers in making estimates of our earned revenue and accounts receivable at each reporting date. For out-of-network services subject to the No Surprises Act, our methodology incorporates, among other things, historical arbitration outcomes, payor behavior, and expected resolution timing in determining the expected transaction price for applicable claims. This estimation process is highly subjective. We regularly conduct a comparative analysis of our actual results to our previously determined transaction results in order to evaluate whether adjustments are required based on newly available information. When the expected transaction price is adjusted, the cumulative effect of that adjustment is reflected in revenue in the period in which the adjustment is identified, including its impact on accounts receivable balances recognized in prior periods, and can result in significant fluctuations in recognized revenue from period to period.
Due to the ongoing operational volatility of the IDR framework and the implementation of these portal modifications, there is inherent uncertainty regarding the ultimate timing and impact of these updates on our financial results. Revenue associated with these estimates is recognized as information becomes available during the normal course of the claims adjudication process, which may result in fluctuations in patient revenue between the period services are rendered and the period related adjustments are recorded. As a result, we may experience significant volatility in our quarterly financial results, which may have a materially adverse effect on the trading price of our common stock.
Certain former doctor owners dispute the number of shares issuable to them under the earn out formula approved in connection with the merger.
Our obligation to issue additional shares of our common stock to former doctor owners of under construction hospitals may cause significant dilution of the voting power of our current stockholders.
We may beare required to issue the additional shares of our common stock to former doctor owners of hospitals that were under construction and non-operational prior to our April 1, 2022 merger. Such former owners, including Dr. Vo, transferred their hospital interests to Nutex Health Holdco LLC in connection with the merger. The aggregate number of additional shares we may be required to issue could significantly dilute the voting power of our existing stockholders. Any such additional shares, including the shares issued to Dr. Vo, will be subject to a 100% lock up for six months, with 66 2/3% of these shares locked up for one year, and, with respect to the remaining 33 1/3%, the lock up expiring 18 months after issuance, which may be waived or amended at the discretion of the Company.
With respect to eight hospitals, the initial 24-month operational periods expired on or prior to March 31, 2026. Based on the formula described above, and assuming an aggregate 1,374,614 shares issued, the earn out shares represent approximately 19.8% of our issued and outstanding shares as of March 31, 2026 (including shares subject to issuance pursuant to the earn out and accrued as of such date).
With respect to two additional hospitals with an initial 24-month operational period expiring on or prior to December 31, 2026, we estimate, based on current expectations, to issue approximately 47,100 additional shares, or 0.7% of our issued and outstanding shares as of March 31, 2026 (including shares subject to issuance pursuant to the earn out and accrued as of such date). See Part I - Item 1 – Notes to Condensed Consolidated Financial Statements (unaudited) – Note 11. This estimated number of shares is calculated on a pro forma basis based on September 30, 2026 operating results and trading price. Since we cannot predict future operating results and trading prices, the actual number of additional shares issued may differ significantly from our estimate.
Former owners of certain under construction hospitals have disputed the number of additional shares issuable to them in accordance with the formula agreed upon at the time of the merger (as described above) and assert, among other things, that the number of shares in the calculation should not be adjusted for the 2024 reverse stock splits. For example, the former doctor owners of ABQ Hospital, LLC dispute the Company’ calculation that an aggregate of 216,039 shares are to be issued to them. Including these shares, an aggregate of approximately 256,005 shares computed by the Company under the formula described above is still under dispute. We disagree with these allegationsallegations, but cannot predict the outcome of these disputes.disputes, including the amounts of cash settlement, if any, and the impact on our financial condition. (Refer to Item 1. -- Legal Proceedings.Proceedings).
Management's Discussion & Analysis (MD&A)
New heading “Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025”
New heading “Nonoperating items”
Largest changes
“•Highlighting the complexity and uncertainty with the NSA and IDR process and the unsuccessful results by various insurers, there are numerous pending lawsuits brought by insurers against IDR vendors and providers (other than Nutex), challenging the awards made in favor of the IDR vendors (including Nutex's vendor, HaloMD) and providers. The insurers have alleged, among other things, that the defendant vendors and providers engaged in fraudulent schemes with respect to IDR eligibility determinations. …”see in full comparison
“Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025”see in full comparison
“•failure to pay the administrative or certified IDR entity fee by the time offers are due, will result in a default in favor of the other party.”see in full comparison
“•Highlighting the complexity and uncertainty with the NSA and IDR process and the unsuccessful results by various insurers, there are numerous pending lawsuits brought by insurers against IDR vendors and providers (other than Nutex), challenging the awards made in favor of the IDR vendors and providers by alleging fraudulent schemes with respect to eligibility determinations, among other things. …”see in full comparison
“•The NSA empowers HHS to assess penalties against insurers for failure to comply with the NSA, including timely payment of CIDRE awards. However, significant enforcement gaps remain in the current law. For example, during 2025, the United States Courts of Appeals for the Fifth and Eleventh Circuits held that providers do not have a private right of action to enforce IDR awards under the NSA and that enforcement authority rests exclusively with HHS. Some courts in other circuits have disagreed. In January 2026, the United States Supreme Court declined review of this issue.”see in full comparison
•In deciding which offer to award, the CIDRE must consider several factors outlined in the law, only one of which is thesee in full comparisoninsurer’squalifying payment amount (“QPA”),definedwhich is calculated by the insurer, subject to the statutory definition as the “median of the contracted rates recognized by the plan or issuer . . . for the same or a similar item or service” offered in the same insurance market and geographic area. The QPA calculation is made in accordance with the 2021 methodology, which is subject to pending court challenges. See Legal challenges to HHS Final Rule below. Among the other factors to be considered by the CIDRE are the complexity or acuity of the case, the doctor’s expertise, and the scope of services provided at the facility.See also below “Legal Challenges to HHS Final Rule – Federal Court removes restrictions imposed on arbitrators in 2022 HHS final Rules (TMA II).”
Full comparison: every changed paragraph (84)
As of MarchJune 31,30, 2026, we employed approximately 1,0051,037 full-time employees, contracted with over 280 doctors at our facilities and partnered with over 3,600 physicians within our networks. Our corporate headquarters is based in Houston, Texas. We were incorporated on April 13, 2000 in the state of Delaware.
The hospital division includes our hospital entities. In addition, we have financial and operating relationships with multiple professional entities (the “Physician LLCs”) and real estate entities part of the real estate division. The Physician LLCs employ the doctors who work in our hospitals. These entities are consolidated by the Company as VIEs because they do not have significant equity at risk to finance their activities independently. The Company is considered the primary beneficiary of these entities because (i) it has the power to direct the activities that most significantly affect their economic performance through its contractual and operational oversight, and (ii) it has the obligation to absorb losses and the right to receive benefits that could be significant, as evidenced by the Company’s historical practice of providing financial support during periods of cash shortfall and receiving the benefit of services. TheWhile the Company hasdoes nonot hold any direct equity or indirect ownership interest in the Physician LLCs.LLCs, it is deemed to have an indirect economic interest through its contractual relationships with intermediary entities. Certain of the Physician LLCs are owned in part and, in some cases, controlled by related parties, including members of the Company’s executive management team.
The real estate division comprises of real estate entities along with activity related to the development and construction of hospital facilities. The real estate entities own the land and hospital buildings which are leased to our hospital entities. The real estate entities also include the Company's headquarters. These entities have mortgage loans payable to third parties which are collateralized by the land and buildings. We consolidate certain real estate entities as VIEs (the "Real Estate VIEs") in instances where our hospital entities are guarantors or co-borrowers under their outstanding mortgage loans. As of MarchJune 31,30, 2026, we continue to consolidate two Real Estate VIEs in our financial statements. The Real Estate VIEs are in part and, in some cases, controlled by related parties, including members of the Company’s executive management team.
Congress enacted the No Surprises Act (“NSA”) effective January 1, 2022, to protect patients from surprise medical bills incurred when they receive emergency medical services from out-of-network healthcare providers, as well as non-emergency services at in-network facilities, and air ambulance services. The NSA achieves this by relieving patients from financial liability for surprise bills and creating an Independentindependent Disputedispute Resolution (“IDR”)resolution process for billing disputes between providers and insurers. The patient is not involved in this process, and payment is issued directly to the provider. The IDR process safeguards providers by promoting fair reimbursement from payors, helping ensure their continued ability to deliver care.
•Independent Dispute Resolution. Under the IDR provisions, Nutex Health and the insurer first must try to agree on a price for the services. If negotiations fail, either party has four days to initiate IDR proceedings. If the parties pursue IDR, either the parties or the Department of Health and Human Services (“HHS”) selects a certified independent dispute resolution entity (“or CIDRE”) to determine the final payment amount.
•In deciding which offer to award, the CIDRE must consider several factors outlined in the law, only one of which is the insurer’s qualifying payment amount (“QPA”), definedwhich is calculated by the insurer, subject to the statutory definition as the “median of the contracted rates recognized by the plan or issuer . . . for the same or a similar item or service” offered in the same insurance market and geographic area. The QPA calculation is made in accordance with the 2021 methodology, which is subject to pending court challenges. See Legal challenges to HHS Final Rule below. Among the other factors to be considered by the CIDRE are the complexity or acuity of the case, the doctor’s expertise, and the scope of services provided at the facility. See also below “Legal Challenges to HHS Final Rule – Federal Court removes restrictions imposed on arbitrators in 2022 HHS final Rules (TMA II).”
•The NSA empowers HHS to assess penalties against insurers for failure to comply with the NSA, including timely payment of CIDRE awards. However, significant enforcement gaps remain in the current law. For example, during 2025, the United States Courts of Appeals for the Fifth and Eleventh Circuits held that providers do not have a private right of action to enforce IDR awards under the NSA and that enforcement authority rests exclusively with HHS. Some courts in other circuits have disagreed. In January 2026, the United States Supreme Court declined review of this issue.
•Highlighting the complexity and uncertainty with the NSA and IDR process and the unsuccessful results by various insurers, there are numerous pending lawsuits brought by insurers against IDR vendors and providers (other than Nutex), challenging the awards made in favor of the IDR vendors (including Nutex's vendor, HaloMD) and providers. The insurers have alleged, among other things, that the defendant vendors and providers engaged in fraudulent schemes with respect to IDR eligibility determinations. During 2026, federal district courts in several jurisdictions have granted the defendants’ motions to dismiss many of these lawsuits, primarily on the grounds that the NSA bars judicial review of IDR determinations except for certain narrow exceptions permitted under the Federal Arbitration Act that were not met. In one of these dismissed cases that had been filed against HaloMD in the Northern District of Georgia, the court further held that the insurer had not adequately alleged a plausible fraud claim, reasoning that it was “highly improbable to infer from these facts that there is a vast conspiracy of providers and IDREs that have conspired to defraud the [insurer] of millions of dollars in thousands of NSA IDR proceedings,” and that it was “highly plausible to infer that the [insurer] engages in a consistent practice of submitting lowball offers to out-of-network providers in an effort to maximize its profits.” However, many other lawsuits remain pending, and the dismissal rulings are subject to appeal.
•The NSA empowers HHS to assess penalties against insurers for failure to comply with the NSA, including timely payment of CIDRE awards. However, as illustrated by the pending legislation discussed below under “Future Expectations,” significant enforcement gaps remain in the current law.
•Highlighting the complexity and uncertainty with the NSA and IDR process and the unsuccessful results by various insurers, there are numerous pending lawsuits brought by insurers against IDR vendors and providers (other than Nutex), challenging the awards made in favor of the IDR vendors and providers by alleging fraudulent schemes with respect to eligibility determinations, among other things. Recently, United States District Courts in each of California and Florida, granted the IDR vendor’s or provider’s, as applicable, motions to dismiss against the insurers, primarily on the grounds that IDR decisions are not reviewable by courts. In addition, citing the California District Court’s dismissal, the United States District Court for the Eastern District of Pennsylvania granted the provider’s motion to dismiss against the insurer, declining to bypass Congress’ intent in the NSA, which limits judicial review. The dismissal rulings are subject to appeal.
•Reopening of Disputes Closed Prior to June 6, 2025 Only for CIDRE Clerical, Jurisdictional or Procedural Errors. On June 6, 2025 HHS published a Technical Assistance allowing the reopening of arbitrationdisputes cases(1) closedreceived on or after June 6, 2025, or (2) received prior to June 5, 2025, but not responded to prior to June 6, 20252025. Reopening is permitted solely for clerical, jurisdictional or procedural errors by the CIDRE. Errors by the parties or substantive disputes among the parties, in particular, with respect to the qualifying payment amount and related statutorily prescribed factors, will not result in a reopening. In addition, HHS has increased the number of CIDREs from 13 to 16 and updated the federal submission portal with respect to, among other things, service-code modifier fields, duplicate-dispute validation, and resubmission rules.
•Federal IDR Operations Final Rule. On May 28, 2026, CMS and federal agencies published the Federal Independent Dispute Resolution Operations final rule, significantly restructuring the Federal IDR Process. Key changes include:
•the non-refundable administrative fee was reduced from $115 to $15 per party per dispute for disputes initiated on or after June 11, 2026;
•for batched disputes only, the cooling off period was reduced from 90 days to 30 days;
•payors must use standardized Claim Adjustment Reason Codes and Remittance Advice Remark Codes on remittance advice sent to out-of-network providers;
•notices in the open negotiation process must be submitted through the Federal IDR portal with expanded content elements;
•payors must register with a new Federal IDR Registry and provide information on plan type, state law opt-in status, and contact information;
•CIDREs must determine eligibility within five business days of final selection; and
•failure to pay the administrative or certified IDR entity fee by the time offers are due, will result in a default in favor of the other party.
In late 2026, the Federal IDR process will transition from single-use web forms to a new IDR Gateway, a centralized digital platform for managing disputes. The general effective date of the final rule is August 3, 2026, with most procedural changes taking effect 90 days after supporting portal functionality becomes available. While the reduction of the administrative fee in particular is expected to have a positive impact, the Company is unable to predict the overall operational and financial impact of the IDR Operations Final Rule.
•Federal Court vacates 2021 HHS interim final rules to ensure fair and accurate rates (TMA III). On November 30, 2022, the TMA filed a lawsuit challenging the methodology of the federal regulator’s calculation of the QPA. The interim final rules allowed consideration of all negotiated rates, including those provided in contracts with providers who do not actually provide the particular service (ghost rates). On August 24, 2023, the federal district court vacated several aspects of the regulations mandating the methodology for the QPA calculation. On October 30, 2024, the United States Court of Appeals for the Fifth Circuit (“Fifth Circuit”) reversed the district court’s vacatur of the QPA calculation methodology. However, on December 17, 2024, the Fifth Circuit ordered that the mandate be withheld and on May 30, 2025 vacated the previous opinion and heldgranted anrehearing en bancbanc. oralOral argument was held on September 24, 2025.2025, and the parties submitted supplemental briefs on "ghost rates" in January 2026. No final en banc opinion has been issued. The Departments have extended the period of enforcement discretion for QPA calculations pending the en banc decision. We cannot predict how such final opinion will affect the QPA calculation or the opinion’s impact on out-of-network payments awarded in the IDR process.
On August 2, 2024, the Fifth Circuit upheld a ruling by district court disallowing provisions of the federalfinal rules established under the NSA which would have required arbitrators (i) to prioritize the insurer established QPA over any of the other factors listed below and (ii) to justify in writing the arbiter’s reliance on any factors beyond the QPA. The Fifth Circuit held that the NSA requires that the arbitrator must consider several factors of equal weight in determining the out-of-network rate. These factors include:
IDR Industry Trends. According to arbitration data published by the Center for Medicare and Medicaid Services (CMS) as of JanuaryMay 21,31, 2026, CIDREs are making significant progress in improving the overall Federal IDR process:
•Between January 1, 2025,2026, and JuneMay 30,31, 2025,2026, disputing parties initiated 1,186,8121,433,289 disputes through the Federal IDR portal,portal. 39%In moreMay than2026, the last six months of 2024 (853,374287,520 disputes). were initiated. Certified IDR entities closed 1,354,911 disputes during January 1 through May 31, 2026, approximately keeping pace with new dispute initiations.
•Providers or their representatives initiated the majority of disputes (81%) in the first six months of 2025.
•The top three initiating parties (HaloMD, Team Health and SCP Health), who represent thousands of clinicians across multiple states, accounted for approximately 44% of all disputes initiated in the first six months of 2025, and 38% of all disputes initiated in the last six months of 2025.
•From January 1 through June 30, 2025, providers, facilities or air ambulance providers,providers prevailed in approximately 88% of payment determinations, as compared to 85% in the last six months of 2024.determinations.
•The percentage of disputes found ineligible decreased from 69% in the first six months of 2022 to 20% in the last six months of 2024 and 17% in the first six months of 2025. As of May 31, 2026, of the 5,862,819 total disputes closed since the portal's launch, 1,066,645 (approximately 18%) were found ineligible.
Overall, between April 15, 2022 and May 31, 2026, 6,336,032 disputes were initiated through the Federal IDR portal, with 4,588,154 payment determinations issued. Certified IDR entities have substantially reduced the backlog of outstanding disputes, consistently closing more disputes than are being initiated on a monthly basis.
Overall, between April 15, 2022 and March 31, 2026, 5,729,954 disputes were initiated, with 985,659 disputes (or approximately 17% of disputes submitted) found ineligible.
IDR Process and Revenue Recognition Constraints. The Company recognizes revenue at the time of service based on the estimated transaction price it expects to receive from third-party payers. We apply ASC 606 – Revenue from Contracts with Customers in making estimates of its earned revenue and accounts receivable at each reporting date. For out-of-network services subject to the No Surprises Act, our methodology incorporates, among other things, historical arbitration outcomes, payor behavior, and expected resolution timing in determining the expected transaction price for applicable claims. This estimation process is highly subjective. The Company regularly conducts a comparative analysis of its actual results to its previously determined transaction results in order to evaluate whether adjustments are required based on newly available information. When the expected transaction price is adjusted, the cumulative effect of that adjustment is reflected in revenue in the period in which the adjustment is identified, including its impact on accounts receivable balances recognized in prior periods, and can result in significant fluctuations in recognized revenue from period to period.
The federal IDR process experienced a significant systemic expansion in dispute volumes, resulting in severe processing backlogs and prolonged determination timelines that frequently exceed statutory windows. In response to these backlogs, HHS implemented several technical adjustments, including increasing the number of CIDREs from 13 to 16, updating the federal submission portal to adjust service-code modifier fields, and altering duplicate-dispute validation and resubmission rules. Additionally, HHS established administrative guidelines permitting the reopening of certain disputes, solely to correct clerical, jurisdictional, or procedural errors by a CIDRE.
While these administrative and technical updates are intended to improve portal efficiency over time, their immediate implementation has introduced further operational volatility, administrative complexity, and lingering eligibility challenges.
Consequently, in accordance with ASC 606, when estimating the amount we ultimately expect to recover at the time of service, the Company re-evaluates the expected transaction price at each reporting period as additional information becomes available and adjusts the variable consideration incorporated in such transaction price when warranted by newly available facts, dispute developments, or collections experience. Due to the ongoing operational volatility of the IDR framework and the implementation of these portal modifications, there is inherent uncertainty regarding the ultimate timing and impact of these updates on our financial results. Revenue associated with these estimates is recognized as information becomes available during the normal course of the claims adjudication process, which may result in fluctuations in patient revenue between the period services are rendered and the period related adjustments are recorded.
Cost of arbitration.Arbitration. There is a significant cost to enter the arbitration process. The arbitration process includes expenses associated with third party providers, including IDR entities, which typically collect fees at the beginning of the process, before the claim award amounts are decided by arbitrators. Effective June 30, 2026, the Company amended its Payment Dispute Resolution Services Agreement with HaloMD, L.L.C. to transition the fee payment structure to a pay-on-collected basis rather than payment due upon award determination, and to amend the service fee structure applicable to various federal and state net settlement amounts obtained on or after July 1, 2026. Pursuant to the Agreement, the Company may perform dispute resolution services in-house or through the engagement of another third-party vendor or service provider with respect to certain future facilities. In addition, on June 4, 2026, CMS and other federal agencies reduced the nonrefundable administrative fee for the federal IDR process from $115 to $15 per party per dispute, effective June 11, 2026. The Company accounted for the impact of these changes as a change in estimate in accordance with ASC 250 and recognized the effects prospectively in the period of change and future periods. The effect of these changes for the three and six months ended June 30, 2026 is reflected as a $52.3 million reduction to contract services expense, which affected the Company’s reported arbitration-related costs for those periods. According to the CMS, as of July 23,27, 2025,2026, the nonrefundable administrative fee was $115$15 per party per dispute and the certified IDR entity fee ranged from $375$200 to $800$840 for single determinations and $75$268 to $1,150$1,173 for batched determinations. The total cost of arbitration for all Nutex hospital and professional services for the three months ended MarchJune 31,30, 2026 and 2025 wastotaled $46.1$(12.5) million and $26.3$48.0 million, respectively, and for the six months ended June 30, 2026 and 2025 totaled $33.6 million and $74.3 million, respectively.
The Federal False Claims Act ("FCA") prohibits a person from knowingly presenting, or causedcausing to be presented, a false or fraudulent request for payment from the federal government, or from making a false statement or using a false record to have a claim approved. A claim includes “any request or demand” for money or property presented to the United States government. Moreover, the government may assert that a claim including items and services resulting from a violation of the AKS or the Stark Law constitutes a false or fraudulent claim for purposes of the civil FCA. Penalties for a violation of the FCA include fines for each false claim, plus up to three times the amount of damages caused by each false claim. Private individuals also have the ability to bring actions under these false claims’ laws in the name of the government alleging false and fraudulent claims presented to or paid by the government (or other violations of the statutes) and to share in any amounts paid by the entity to the government in fines or settlement. Such suits, known as qui tam actions, are pervasive in the healthcare industry.
•Regulatory uncertainty, including potential changes to healthcare laws, reimbursement rates and payment policies;
•Regulatory uncertainty
•A growing focus on healthcare spendingcosts by consumers, employers and insurers, who are actively seeking lower-cost care solutions;
First Amendment to Payment Dispute Resolution Services Agreement. Effective June 30, 2026, the Company amended its Payment Dispute Resolution Services Agreement with HaloMD, L.L.C. (the "Agreement"), dated as of May 1, 2024, which supports the Company's IDR process for certain out-of-network claims. Among other changes, the amendment transitioned the applicable fee payment structure to a pay-on-collected basis, rather than payment due upon award determination, retroactive to the effective date of the original Agreement, and amended the service fee structure applicable to various federal and state net settlement amounts obtained on or after July 1, 2026. Pursuant to the Agreement, the Company may perform dispute resolution services in-house or through the engagement of another third-party vendor or service provider with respect to certain future facilities and extended the initial term of the agreement through December 31, 2029.
Settlement Agreements with certain Former Doctor Owners of Under Construction Hospitals. During and subsequent to the three months ended MarchJune 31,30, 2026, the Company entered into agreements with certain former doctor owners to settle existing disputes and, in connection with the settlements, to retire a portion of the shares issuable to satisfy obligations for under-construction and ramping hospitals. See Note 11 – Stock-based Compensation for discussion of additional issuances of stock for Under Construction Hospitals, an obligation within the Contribution Agreements. During the three and six months ended MarchJune 31,30, 2026, the Company retired 60,51686,836 and 147,352 shares of common stockstock, respectively, at an aggregate value of $9.7$15.6 million.million Subsequentand to$25.3 themillion, three months ended March 31, 2026, the Company retired an additional 72,350 shares of common stock at an aggregate value of $13.0 million.respectively.
Three Months Ended MarchJune 31,30, 2026 Compared to Three Months Ended MarchJune 31,30, 2025
Net income attributable to Nutex Health Inc. was $46.8$65.8 million, or income of $6.52$9.38 per diluted share, for the three months ended MarchJune 31,30, 2026 compared to net incomeloss attributable to Nutex Health Inc. of $21.2$17.7 million, or incomeloss of $3.33$2.95 per share, for the same period 2025. Our 2026 results were principally affected by:
•Higher patient visits, which increased by 3.1%9.6% during the three months ended MarchJune 31,30, 2026 as compared with the same period of 2025. Visits at same hospitals, which are hospitals that were opened by December 31, 2024, increased an average of 0.6%6.3% versus prior year.
•Increased cash collections and billable visits partially offset by a decrease in net revenue per visit.
•Lower stock-basedhospital compensationdivision to under construction and ramping hospitalsrevenue of $(3.9)$201.9 million for the three months ended MarchJune 31,30, 2026, a decrease of $31.6$34.5 million compared to the same period last year.
•Lower stock-based compensation to under construction and ramping hospitals of $2.9 million for the three months ended June 30, 2026, a decrease of $75.9 million compared to the same period last year.
•LowerHigher income tax expense of $13.8$20.8 million for the three months ended MarchJune 31,30, 2026 compared to $20.4$7.6 million for the three months ended MarchJune 31,30, 2025, aan decreaseincrease of $6.6$13.2 million.
Adjusted EBITDA for the three months ended MarchJune 31,30, 2026 decreasedincreased to $57.6$90.0 million from $72.8$71.6 million for the comparable period 2025. Refer to Non-GAAP Financial Measures discussed below for a definition and reconciliation of net income (loss) attributable to Nutex Health Inc. to Adjusted EBITDA. Stock-based compensation contributed significantly to the decreaseincrease in Adjusted EBITDA in the 2026 period.
Hospital Division. Our revenue for the three months ended MarchJune 31,30, 2026 totaled $207.6$201.9 million as compared to $203.9$236.3 million for the same period in 2025, ana increasedecrease of $3.6$34.5 million or 1.8%.14.6%. This increasedecrease was primarily attributed to anpositive increaseadjustments to variable consideration realized in cash2025 collectionsas andwe billableexperienced visits,early slightlysuccess offsetwith bythe aIDR decrease in net revenue per visit.process. Revenue related to same hospitals increaseddecreased by 0.2%.12.1%.
Total patient visits increased 3.1%9.6% during the three months ended MarchJune 31,30, 2026 as compared with the same period in 2025 including the impact of the opening of two facilities throughout 2025 which are fully operating in 2026.
The hospital division’s gross profit was $89.6$141.8 million during the three months ended MarchJune 31,30, 2026, compared with $117.9$125.6 million in the same period in 2025, aan decreaseincrease of 24.0%.13.0%. The decreaseincrease is primarily driven by the lower total cost of arbitration, which for all Nutex hospital and professional services for the three months ended MarchJune 31,30, 2026 and 2025 was $46.1$(12.5) million and $26.3$48.0 million, respectively. This decrease was due to less settlements and open disputes in the prior period as the Company was increasing its IDR submissions in the first quarter of 2025.
This decrease in total cost of arbitration, reflected as a reduction to contract services expense of $52.3 million, was primarily due to the amendment to the Agreement with HaloMD effective June 30, 2026 and the reduction by CMS and other federal agencies of administrative fees ("CMS fee"). The amendment transitioned the applicable fee payment structure to a pay-on-collected basis (rather than payment due upon award determination) retroactive to the effective date of the original Agreement with HaloMD. This change in fee payment structure contributed to $38.4 million of the reduction to contract services. Additionally, the amendment changed the service fee structure applicable to various federal and state net settlement amounts obtained on or after July 1, 2026. The impact of this change in service fee structure contributed to $9.6 million of the reduction to contract services. Regarding the CMS fee reduction, the non-refundable administrative fee for the federal IDR process reduced from $115 to $15 per party per dispute, effective June 11, 2026. The reduction in the CMS fee contributed to $4.3 million of the reduction to contract services. Based upon current expectations, we anticipate the impact of these favorable changes will lead to an approximate 25-30% reduction in our normalized historical contract services prospectively. This impact is based on the current regulatory outlook and the Company’s current expectations, and actual contract services expenses incurred in the future may differ significantly.
Population Health Management Division. Our total revenue for the three months ended MarchJune 31,30, 2026 was $8.9 million as compared with $7.8$7.7 million for the same period in 2025.2025, with the increase primarily due to increased members.
The population health management division had $2.4$0.5 million of loss before income taxes for the three months ended MarchJune 31,30, 2026 as compared with $0.6 million of loss for the same period inand 2025. Strategically, we are focused on the growth of this division principally through the addition of new independent physician associations and have staffed our organization to manage larger numbers of such organizations.
As of MarchJune 31,30, 2026, the Company consolidates two Real Estate VIEs. We expect that hospitals we open in the future may be leased from new real estate entities which may be owned in whole or part by the Company or related parties. If owned by related parties, third-party lenders to these entities may require that we provide a guarantee or become co-borrowers under mortgage indebtedness and financings for such facilities. In such instances, we may be required to consolidate these new real estate entities in our financial statements as VIEs.
Corporate and other costs. Corporate and other costs in the three months ended MarchJune 31,30, 2026 totaled $10.5$19.6 million as compared to $37.7$91.2 million for the same period in 2025, a decrease of 72.2%.78.6%. General and administrative costs include our executive management, accounting, human resources, corporate technology, insurance and professional fees. The decrease in corporate and other costs is primarily due to a decrease in stock-based compensation of $31.6$75.9 million related to obligations for under-construction and ramping hospitals, andoffset slightly by an increase in general and administrative expenses of $4.3$4.2 million.
Interest expense.expense, net. Interest expenseexpense, net was $4.7 million for the three months ended MarchJune 31,30, 2026 as compared with $6.1$5.7 million for the same period of 2024.2025. The decrease in interest expenseexpense, net in 2026 is primarily due to the payoff of loans and interest income received from sweep accounts.
Income tax expense. Income tax provisions for interim quarterly periods are generally based on an estimated annual effective income tax rate calculated separately from the effect of significant, infrequent or unusual items related specifically to interim periods. The income tax impact of discrete items is recognized in the period these occur.
Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025
NUTX insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 1 filing (1 insider, 1 trade date, 203 shares, about $43.5K). Net open-market shares: -203 (purchases minus sales); net value about -$43.5K.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-09-18 | Saunders Scott J |
Open-market sale | 203 | $214.25 | $43.5K |
| 2026-07-31 | Jaumot Frank E |
Option exercise | 603 | — | — |
| 2026-07-31 | Grenas Cheryl Yvonne |
Option exercise | 603 | — | — |
| 2026-07-31 | Saunders Scott J |
Option exercise | 603 | — | — |
| 2026-07-31 | Reed Michael Lee |
Option exercise | 603 | — | — |
| 2026-06-04 | Spears Kelvin |
Other | 2,519 | — | — |
| 2026-05-28 | Vo Thomas T. |
Other | 75,747 | — | — |
Well-known investors holding NUTX (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| D. E. Shaw & Co. | 2026-06-30 | 97,454 | $16.7M | 0.01% | New position |
| Millennium Management (Israel Englander) | 2026-06-30 | 52,107 | $8.9M | 0.01% | Reduced 42% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 18,315 | $3.1M | 0.0% | New position |
| Two Sigma Investments | 2026-06-30 | 10,569 | $1.0M | — | Sold out |
| Gotham Asset Management (Joel Greenblatt) | 2026-06-30 | 3,258 | $556.8K | 0.0% | New position |