Discontinued Operations

12 Months Ended

Dec. 31, 2019

Discontinued Operations And Disposal Groups [Abstract]

Discontinued Operations

17. Discontinued Operations

Netsmart Discontinued Operation

On December 31, 2018, we sold all of the Class A Common Units of Netsmart held by the Company in exchange for $566.6 million in cash plus a final settlement as determined following the closing. Prior to the sale, Netsmart comprised a separate reportable segment, which due to its significance to our historical consolidated financial statements and results of operations, is reported as a discontinued operation as a result of the sale. Refer to Note 4, “Business Combinations and Other Investments” for additional information about this transaction.

The following table summarizes Netsmart’s major income and expense line items as reported in the consolidated statements of operations for the years ended December 31, 2018 and 2017:

	Year ended December 31,
(In thousands)	2018			2017
Major income and expense line items related to Netsmart:
Revenue:
Software delivery, support and maintenance	$	214,065		$	198,204
Client services		131,166			110,430
Total revenue		345,231			308,634
Cost of revenue:
Software delivery, support and maintenance		60,100			51,079
Client services		94,061			78,317
Amortization of software development and acquisition related assets		34,357			29,876
Total cost of revenue		188,518			159,272
Gross profit		156,713			149,362
Selling, general and administrative expenses		125,807			85,583
Research and development		25,315			17,937
Amortization of intangible and acquisition-related assets		24,029			16,409
Income from discontinued operations of Netsmart		(18,438	)		29,433
Interest expense		(59,541	)		(49,939	)
Other income		101			925
Loss from discontinued operations of Netsmart before     income taxes		(77,878	)		(19,581	)
Income tax benefit		22,933			45,253
(Loss) income from discontinued operations, net of tax for Netsmart	$	(54,945	)	$	25,672

⁽¹⁾ Activity includes both Netsmart and intercompany transactions that would not have been eliminated if Netsmart’s results were not consolidated.

Horizon Clinicals and Series2000 Revenue Cycle Discontinued Operation

Two of the product offerings acquired with the EIS Business in 2017, Horizon Clinicals and Series2000 Revenue Cycle, were sunset after March 31, 2018. The decision to discontinue maintaining and supporting these solutions was made prior to our acquisition of the EIS Business and, therefore, they are presented below as discontinued operations. Until the end of the first quarter of 2018, we were involved in ongoing maintenance and support for these solutions until customers transitioned to other platforms. No disposal gains or losses were recognized during the year ended December 31, 2018 related to these discontinued solutions. We had $0.9 million of accrued expenses associated with the Horizon Clinicals and Series2000 Revenue Cycle businesses on the consolidated balance sheets as of December 31, 2018

The following table summarizes the major income and expense line items of these discontinued solutions, as reported in the consolidated statements of operations for the years ended December 31, 2018 and 2017:

	Year ended December 31,
(In thousands)	2018			2017
Major classes of line items constituting pretax profit (loss) of    discontinued operations for Horizon Clinicals and    Series2000 Revenue Cycle:
Revenue:
Software delivery, support and maintenance	$	9,441		$	10,949
Client services		404			1,044
Total revenue		9,845			11,993
Cost of revenue:
Software delivery, support and maintenance		2,322			2,918
Client services		830			261
Total cost of revenue		3,152			3,179
Gross profit		6,693			8,814
Research and development		1,651			1,148
Income from discontinued operations for Horizon Clinicals    and Series2000 Revenue Cycle before income taxes		5,042			7,666
Income tax provision		(1,311	)		(2,990	)
Income from discontinued operations, net of tax for Horizon    Clinicals and Series2000 Revenue Cycle	$	3,731		$	4,676