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Condensed Consolidating Financial Information
 3 Months Ended
Mar. 31, 2016
Condensed Consolidating Financial Information [Abstract]  
Condensed Consolidating Financial Information
Condensed Consolidating Financial Information
The accompanying condensed consolidating financial information has been prepared and presented pursuant to SEC Regulation S-X, Rule 3-10, “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.” Each of the subsidiary guarantors is 100% owned by HealthSouth, and all guarantees are full and unconditional and joint and several, subject to certain customary conditions for release. HealthSouth’s investments in its consolidated subsidiaries, as well as guarantor subsidiaries’ investments in nonguarantor subsidiaries and nonguarantor subsidiaries’ investments in guarantor subsidiaries, are presented under the equity method of accounting with the related investment presented within the line items Intercompany receivable and investments in consolidated affiliates and Intercompany payable in the accompanying condensed consolidating balance sheets.
The terms of our credit agreement allow us to declare and pay cash dividends on our common stock so long as: (1) we are not in default under our credit agreement and (2) our senior secured leverage ratio (as defined in our credit agreement) remains less than or equal to 1.75x. The terms of our senior note indenture allow us to declare and pay cash dividends on our common stock so long as (1) we are not in default, (2) the consolidated coverage ratio (as defined in the indenture) exceeds 2x or we are otherwise allowed under the indenture to incur debt, and (3) we have capacity under the indenture’s restricted payments covenant to declare and pay dividends. See Note 8, Long-term Debt, to the consolidated financial statements accompanying the 2015 Form 10-K.
Periodically, certain wholly owned subsidiaries of HealthSouth make dividends or distributions of available cash and/or intercompany receivable balances to their parents. In addition, HealthSouth makes contributions to certain wholly owned subsidiaries. When made, these dividends, distributions, and contributions impact the Intercompany receivable, Intercompany payable, and HealthSouth shareholders’ equity line items in the accompanying condensed consolidating balance sheet but have no impact on the consolidated financial statements of HealthSouth Corporation.
 
Three Months Ended March 31, 2016
 
HealthSouth Corporation
 
Guarantor Subsidiaries
 
Nonguarantor Subsidiaries
 
Eliminating Entries
 
HealthSouth Consolidated
 
(In Millions)
Net operating revenues
$
4.9

 
$
550.7

 
$
383.2

 
$
(29.0
)
 
$
909.8

Less: Provision for doubtful accounts
—

 
(11.9
)
 
(4.6
)
 
—

 
(16.5
)
Net operating revenues less provision for doubtful accounts
4.9

 
538.8

 
378.6

 
(29.0
)
 
893.3

Operating expenses:
 

 
 

 
 

 
 

 
 
Salaries and benefits
11.3

 
255.0

 
224.4

 
(4.6
)
 
486.1

Other operating expenses
5.4

 
77.1

 
47.8

 
(11.1
)
 
119.2

Occupancy costs
0.9

 
23.0

 
7.4

 
(13.3
)
 
18.0

Supplies
—

 
23.2

 
11.8

 
—

 
35.0

General and administrative expenses
33.2

 
—

 
(1.3
)
 
—

 
31.9

Depreciation and amortization
2.4

 
25.7

 
14.3

 
—

 
42.4

Professional fees—accounting, tax, and legal
0.2

 
—

 
—

 
—

 
0.2

Total operating expenses
53.4

 
404.0

 
304.4

 
(29.0
)
 
732.8

Loss on early extinguishment of debt
2.4

 
—

 
—

 
—

 
2.4

Interest expense and amortization of debt discounts and fees
38.9

 
5.2

 
5.3

 
(4.8
)
 
44.6

Other income
(4.7
)
 
(0.1
)
 
(0.6
)
 
4.8

 
(0.6
)
Equity in net income of nonconsolidated affiliates
—

 
(2.1
)
 
(0.3
)
 
—

 
(2.4
)
Equity in net income of consolidated affiliates
(86.2
)
 
(8.2
)
 
—

 
94.4

 
—

Management fees
(34.2
)
 
26.2

 
8.0

 
—

 
—

Income from continuing operations before income tax (benefit) expense
35.3

 
113.8

 
61.8

 
(94.4
)
 
116.5

Provision for income tax (benefit) expense
(22.8
)
 
45.4

 
17.1

 
—

 
39.7

Income from continuing operations
58.1

 
68.4

 
44.7

 
(94.4
)
 
76.8

Loss from discontinued operations, net of tax
(0.1
)
 
—

 
—

 
—

 
(0.1
)
Net income
58.0

 
68.4

 
44.7

 
(94.4
)
 
76.7

Less: Net income attributable to noncontrolling interests
—

 
—

 
(18.7
)
 
—

 
(18.7
)
Net income attributable to HealthSouth
$
58.0

 
$
68.4

 
$
26.0

 
$
(94.4
)
 
$
58.0

Comprehensive income
$
58.1

 
$
68.4

 
$
44.7

 
$
(94.4
)
 
$
76.8

Comprehensive income attributable to HealthSouth
$
58.1

 
$
68.4

 
$
26.0

 
$
(94.4
)
 
$
58.1

 
Three Months Ended March 31, 2015
 
HealthSouth Corporation
 
Guarantor Subsidiaries
 
Nonguarantor Subsidiaries
 
Eliminating Entries
 
HealthSouth Consolidated
 
(In Millions)
Net operating revenues
$
5.3

 
$
456.8

 
$
303.2

 
$
(24.7
)
 
$
740.6

Less: Provision for doubtful accounts
—

 
(9.0
)
 
(2.6
)
 
—

 
(11.6
)
Net operating revenues less provision for doubtful accounts
5.3

 
447.8

 
300.6

 
(24.7
)
 
729.0

Operating expenses:
 

 
 

 
 

 
 

 
 
Salaries and benefits
8.1

 
211.1

 
170.0

 
(4.1
)
 
385.1

Other operating expenses
9.5

 
63.1

 
41.0

 
(10.4
)
 
103.2

Occupancy costs
1.1

 
15.3

 
5.9

 
(10.2
)
 
12.1

Supplies
—

 
20.8

 
10.6

 
—

 
31.4

General and administrative expenses
34.3

 
—

 
0.3

 
—

 
34.6

Depreciation and amortization
2.3

 
19.1

 
10.5

 
—

 
31.9

Government, class action, and related settlements
8.0

 
—

 
—

 
—

 
8.0

Professional fees—accounting, tax, and legal
2.2

 
—

 
—

 
—

 
2.2

Total operating expenses
65.5

 
329.4

 
238.3

 
(24.7
)
 
608.5

Loss on early extinguishment of debt
1.2

 
—

 
—

 
—

 
1.2

Interest expense and amortization of debt discounts and fees
29.2

 
2.3

 
2.7

 
(2.4
)
 
31.8

Other income
(2.3
)
 
—

 
(0.6
)
 
2.4

 
(0.5
)
Equity in net income of nonconsolidated affiliates
—

 
(1.6
)
 
—

 
—

 
(1.6
)
Equity in net income of consolidated affiliates
(78.6
)
 
(8.1
)
 
—

 
86.7

 
—

Management fees
(28.5
)
 
21.7

 
6.8

 
—

 
—

Income from continuing operations before income tax (benefit) expense
18.8

 
104.1

 
53.4

 
(86.7
)
 
89.6

Provision for income tax (benefit) expense
(24.0
)
 
39.6

 
14.7

 
—

 
30.3

Income from continuing operations
42.8

 
64.5

 
38.7

 
(86.7
)
 
59.3

Loss from discontinued operations, net of tax
(0.3
)
 
—

 
—

 
—

 
(0.3
)
Net income
42.5

 
64.5

 
38.7

 
(86.7
)
 
59.0

Less: Net income attributable to noncontrolling interests
—

 
—

 
(16.5
)
 
—

 
(16.5
)
Net income attributable to HealthSouth
$
42.5

 
$
64.5

 
$
22.2

 
$
(86.7
)
 
$
42.5

Comprehensive income
$
42.6

 
$
64.5

 
$
38.7

 
$
(86.7
)
 
$
59.1

Comprehensive income attributable to HealthSouth
$
42.6

 
$
64.5

 
$
22.2

 
$
(86.7
)
 
$
42.6

 
As of March 31, 2016
 
HealthSouth Corporation
 
Guarantor Subsidiaries
 
Nonguarantor Subsidiaries
 
Eliminating Entries
 
HealthSouth Consolidated
 
(In Millions)
Assets
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
47.8

 
$
2.7

 
$
22.7

 
$
—

 
$
73.2

Accounts receivable, net
—

 
277.7

 
154.2

 
—

 
431.9

Other current assets
59.1

 
21.6

 
127.5

 
(81.2
)
 
127.0

Total current assets
106.9

 
302.0

 
304.4

 
(81.2
)
 
632.1

Property and equipment, net
15.8

 
960.5

 
341.4

 
—

 
1,317.7

Goodwill
—

 
863.2

 
1,028.7

 
—

 
1,891.9

Intangible assets, net
11.2

 
122.0

 
282.6

 
—

 
415.8

Deferred income tax assets
131.3

 
63.2

 
—

 
(49.5
)
 
145.0

Other long-term assets
48.2

 
81.0

 
76.6

 
—

 
205.8

Intercompany notes receivable
541.3

 
—

 
—

 
(541.3
)
 
—

Intercompany receivable and investments in consolidated affiliates
2,802.0

 
—

 
—

 
(2,802.0
)
 
—

Total assets
$
3,656.7

 
$
2,391.9

 
$
2,033.7

 
$
(3,474.0
)
 
$
4,608.3

Liabilities and Shareholders’ Equity
 

 
 

 
 

 
 

 


Current liabilities:
 

 
 

 
 

 
 

 


Current portion of long-term debt
$
40.1

 
$
6.6

 
$
7.4

 
$
(17.5
)
 
$
36.6

Accounts payable
6.0

 
38.2

 
18.5

 
—

 
62.7

Accrued expenses and other current liabilities
151.3

 
90.4

 
186.5

 
(63.7
)
 
364.5

Total current liabilities
197.4

 
135.2

 
212.4

 
(81.2
)
 
463.8

Long-term debt, net of current portion
2,769.7

 
254.0

 
55.9

 
—

 
3,079.6

Intercompany notes payable
—

 
—

 
541.3

 
(541.3
)
 
—

Other long-term liabilities
40.1

 
14.3

 
139.6

 
(49.2
)
 
144.8

Intercompany payable
—

 
42.5

 
176.9

 
(219.4
)
 
—

 
3,007.2

 
446.0

 
1,126.1

 
(891.1
)
 
3,688.2

Commitments and contingencies


 


 


 


 


Redeemable noncontrolling interests
—

 
—

 
96.2

 
—

 
96.2

Shareholders’ equity:
 

 
 

 
 

 
 

 


HealthSouth shareholders’ equity
649.5

 
1,945.9

 
637.0

 
(2,582.9
)
 
649.5

Noncontrolling interests
—

 
—

 
174.4

 
—

 
174.4

Total shareholders’ equity
649.5

 
1,945.9

 
811.4

 
(2,582.9
)
 
823.9

Total liabilities and shareholders’ equity
$
3,656.7

 
$
2,391.9

 
$
2,033.7

 
$
(3,474.0
)
 
$
4,608.3


 
As of December 31, 2015
 
HealthSouth Corporation
 
Guarantor Subsidiaries
 
Nonguarantor Subsidiaries
 
Eliminating Entries
 
HealthSouth Consolidated
 
(In Millions)
Assets
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
41.2

 
$
1.3

 
$
19.1

 
$
—

 
$
61.6

Accounts receivable, net
—

 
267.2

 
143.3

 
—

 
410.5

Other current assets
29.3

 
22.7

 
93.4

 
(18.8
)
 
126.6

Total current assets
70.5

 
291.2

 
255.8

 
(18.8
)
 
598.7

Property and equipment, net
14.5

 
965.7

 
329.9

 
—

 
1,310.1

Goodwill
—

 
863.2

 
1,026.9

 
—

 
1,890.1

Intangible assets, net
8.8

 
123.2

 
287.4

 
—

 
419.4

Deferred income tax assets
176.2

 
64.1

 
—

 
(49.5
)
 
190.8

Other long-term assets
48.6

 
75.3

 
73.1

 
—

 
197.0

Intercompany notes receivable
546.6

 
—

 
—

 
(546.6
)
 
—

Intercompany receivable and investments in consolidated affiliates
2,779.7

 
—

 
—

 
(2,779.7
)
 
—

Total assets
$
3,644.9

 
$
2,382.7

 
$
1,973.1

 
$
(3,394.6
)
 
$
4,606.1

Liabilities and Shareholders’ Equity
 

 
 

 
 

 
 

 


Current liabilities:
 

 
 

 
 

 
 

 


Current portion of long-term debt
$
40.0

 
$
6.8

 
$
7.5

 
$
(17.5
)
 
$
36.8

Accounts payable
5.8

 
35.2

 
20.6

 
—

 
61.6

Accrued expenses and other current liabilities
122.2

 
72.6

 
134.5

 
(1.3
)
 
328.0

Total current liabilities
168.0

 
114.6


162.6


(18.8
)
 
426.4

Long-term debt, net of current portion
2,821.9

 
255.6

 
57.2

 
—

 
3,134.7

Intercompany notes payable
—

 
—

 
546.6

 
(546.6
)
 
—

Other long-term liabilities
43.6

 
12.4

 
137.7

 
(49.1
)
 
144.6

Intercompany payable
—

 
141.7

 
179.1

 
(320.8
)
 
—

 
3,033.5

 
524.3


1,083.2


(935.3
)
 
3,705.7

Commitments and contingencies


 


 


 


 


Redeemable noncontrolling interests
—

 
—

 
121.1

 
—

 
121.1

Shareholders’ equity:
 

 
 

 
 

 
 

 


HealthSouth shareholders’ equity
611.4

 
1,858.4

 
600.9

 
(2,459.3
)
 
611.4

Noncontrolling interests
—

 
—

 
167.9

 
—

 
167.9

Total shareholders’ equity
611.4

 
1,858.4


768.8


(2,459.3
)
 
779.3

Total liabilities and shareholders’ equity
$
3,644.9

 
$
2,382.7


$
1,973.1


$
(3,394.6
)
 
$
4,606.1

 
Three Months Ended March 31, 2016
 
HealthSouth Corporation
 
Guarantor Subsidiaries
 
Nonguarantor Subsidiaries
 
Eliminating Entries
 
HealthSouth Consolidated
 
(In Millions)
Net cash provided by operating activities
$
4.0

 
$
93.4

 
$
62.4

 
$
(0.1
)
 
$
159.7

Cash flows from investing activities:
 

 
 

 
 

 
 

 
 

Purchases of property and equipment
(3.2
)
 
(13.4
)
 
(14.8
)
 
—

 
(31.4
)
Capitalized software costs
(7.7
)
 
—

 
—

 
—

 
(7.7
)
Net change in restricted cash
—

 
—

 
(3.2
)
 
—

 
(3.2
)
Proceeds from repayment of intercompany notes receivable
5.0

 
—

 
—

 
(5.0
)
 
—

Other
—

 
(0.3
)
 
3.1

 
—

 
2.8

Net cash used in investing activities
(5.9
)
 
(13.7
)

(14.9
)

(5.0
)
 
(39.5
)
Cash flows from financing activities:
 

 
 

 
 

 
 

 


Principal payments on debt, including pre-payments
(55.6
)
 
(0.4
)
 
(0.3
)
 
—

 
(56.3
)
Principal payments on intercompany notes payable
—

 
—

 
(5.0
)
 
5.0

 
—

Borrowings on revolving credit facility
60.0

 
—

 
—

 
—

 
60.0

Payments on revolving credit facility
(60.0
)
 
—

 
—

 
—

 
(60.0
)
Repurchases of common stock, including fees and expenses
(12.9
)
 
—

 
—

 
—

 
(12.9
)
Dividends paid on common stock
(21.3
)
 
—

 
—

 
—

 
(21.3
)
Distributions paid to noncontrolling interests of consolidated affiliates
—

 
—

 
(15.6
)
 
—

 
(15.6
)
Other
0.3

 
(1.4
)
 
(1.4
)
 
—

 
(2.5
)
Change in intercompany advances
98.0

 
(76.5
)
 
(21.6
)
 
0.1

 
—

Net cash provided by (used in) financing activities
8.5

 
(78.3
)

(43.9
)

5.1

 
(108.6
)
Increase in cash and cash equivalents
6.6

 
1.4


3.6


—

 
11.6

Cash and cash equivalents at beginning of period
41.2

 
1.3

 
19.1

 
—

 
61.6

Cash and cash equivalents at end of period
$
47.8

 
$
2.7


$
22.7


$
—

 
$
73.2


 
Three Months Ended March 31, 2015
 
HealthSouth Corporation
 
Guarantor Subsidiaries
 
Nonguarantor Subsidiaries
 
Eliminating Entries
 
HealthSouth Consolidated
 
(In Millions)
Net cash provided by operating activities
$
6.6

 
$
53.0

 
$
42.4

 
$
—

 
$
102.0

Cash flows from investing activities:
 

 
 

 
 

 
 

 
 

Purchases of property and equipment
(2.4
)
 
(8.2
)
 
(7.1
)
 
—

 
(17.7
)
Capitalized software costs
(8.8
)
 
—

 
(0.1
)
 
—

 
(8.9
)
Acquisitions of businesses, net of cash acquired
—

 
—

 
(7.3
)
 
—

 
(7.3
)
Net change in restricted cash
—

 
—

 
(15.0
)
 
—

 
(15.0
)
Other
—

 
3.5

 
(0.3
)
 
—

 
3.2

Net cash used in investing activities
(11.2
)
 
(4.7
)
 
(29.8
)
 
—

 
(45.7
)
Cash flows from financing activities:
 

 
 

 
 

 
 

 


Proceeds from bond issuance
700.0

 
—

 
—

 
—

 
700.0

Principal payments on debt, including pre-payments
(252.5
)
 
(0.4
)
 
—

 
—

 
(252.9
)
Borrowings on revolving credit facility
35.0

 
—

 
—

 
—

 
35.0

Payments on revolving credit facility
(350.0
)
 
—

 
—

 
—

 
(350.0
)
Debt amendment and issuance costs
(13.7
)
 
—

 
—

 
—

 
(13.7
)
Dividends paid on common stock
(18.6
)
 
—

 
—

 
—

 
(18.6
)
Dividends paid on convertible perpetual preferred stock
(1.6
)
 
—

 
—

 
—

 
(1.6
)
Distributions paid to noncontrolling interests of consolidated affiliates
—

 
—

 
(13.2
)
 
—

 
(13.2
)
Other
1.7

 
(0.6
)
 
(0.8
)
 
—

 
0.3

Change in intercompany advances
52.0

 
(47.8
)
 
(4.2
)
 
—

 
—

Net cash provided by (used in) financing activities
152.3

 
(48.8
)
 
(18.2
)
 
—

 
85.3

Increase (decrease) in cash and cash equivalents
147.7

 
(0.5
)
 
(5.6
)
 
—

 
141.6

Cash and cash equivalents at beginning of period
41.9

 
1.5

 
23.3

 
—

 
66.7

Cash and cash equivalents at end of period
$
189.6

 
$
1.0

 
$
17.7

 
$
—

 
$
208.3