Fair Value Measurements

9 Months Ended

Sep. 30, 2021

Note 4. Fair Value Measurements

The authoritative guidance on fair value measurements establishes a framework with respect to measuring assets and liabilities at fair value on a recurring basis and non-recurring basis. Under the framework, fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, as of the measurement date. The framework also establishes a three-tier hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability and are developed based on the best information available in the circumstances. The hierarchy consists of the following three levels:

Level 1:	Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date.
Level 2:	Inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3:	Inputs are unobservable inputs for the asset or liability.

The following tables present information about the Company’s financial assets measured at fair value on a recurring basis, based on the three-tier fair value hierarchy:

	September 30, 2021
	Total		Level 1		Level 2		Level 3
	(in thousands)
Equity securities, debt securities and cash equivalents:
Bond funds	$	128,987	$	128,987	$	—	$	—
Exchange traded funds		35,090		35,090		—		—
Corporate debt securities		357,762		—		357,762		—
U.S. government debt securities		64,135		—		64,135		—
U.S. agency debt securities		39,693		—		39,693		—
Municipal bonds		24,389		—		24,389		—
Yankee debt securities		12,330		—		12,330		—
Redeemable preferred stock investment		20,000		—		—		20,000
Money market accounts		50,425		50,425		—		—
Total equity securities, debt securities and cash equivalents	$	732,811	$	214,502	$	498,309	$	20,000

	December 31, 2020
	Total		Level 1		Level 2		Level 3
	(in thousands)
Equity securities, debt securities and cash equivalents:
Bond funds	$	153,185	$	153,185	$	—	$	—
Exchange traded funds		17,609		17,609		—		—
Corporate debt securities		166,599		—		166,599		—
Yankee debt securities		6,048		—		6,048		—
U.S. agency debt securities		1,002		—		1,002		—
Money market accounts		47,461		47,461		—		—
Total equity securities, debt securities and cash equivalents	$	391,904	$	218,255	$	173,649	$	—

The Company’s Level 1 assets include bond funds, exchange traded funds, and money market instruments and are valued based upon observable market prices. Level 2 assets consist of U.S. government and U.S. agency debt securities, municipal bonds, corporate debt securities and Yankee debt securities. Level 2 securities are valued based upon observable inputs that include reported trades, broker/dealer quotes, bids and offers. As of September 30, 2021, the Company had $20.0 million of redeemable preferred stock of Helio Health that was measured using unobservable (Level 3) inputs. The quantitative unobservable inputs for the redeemable preferred stock investment are not developed by the Company. The fair value is based on the most recent transaction price in July 2021, and there has not been any significant activity at Helio Health since July 2021, including any new funding rounds, that would result in a material change in the value.

There were no transfers between fair value measurement levels during the three and nine months ended September 30, 2021.