P3 Health Partners Inc. Quarterly report [Sections 13 or 15(d)]

Quarterly report [Sections 13 or 15(d)]

Variable Interest Entities

Variable Interest Entities

3 Months Ended

Mar. 31, 2025

Note 13: Variable Interest Entities

P3 LLC has Management Services Agreements (“MSAs”) and deficit funding agreements with the Network VIEs. The MSAs provide that P3 LLC will furnish administrative personnel, office supplies and equipment, general business services, contract negotiation, and billing and collection services to the Network VIEs. Fees for these services are the excess of the Network VIEs’ revenue over expenses. Per the deficit funding agreements, P3 LLC is obligated to advance funds, as needed, to support the Network VIEs’ working capital needs to the extent operating expenses exceed gross revenue. These advances accrue interest at a rate of prime plus 2%. Net advances made to the Network VIEs and accrued interest on those advances are presented within due to consolidated entities of P3 in the table below. Additionally, P3 LLC entered into stock transfer restriction agreements with the practice shareholders of the Network VIEs, which, by way of a call option, unequivocally permit P3 LLC to appoint successor physicians if a practice shareholder vacates their ownership position. Accordingly, P3 LLC identifies itself as the primary beneficiary of the Network VIEs. Practice shareholders, who are employees of P3 LLC, retain equity ownership in the Network VIEs, which represents nominal non-controlling interests; however, the non-controlling interests do not participate in the profit or loss of the Network VIEs.

P3 LLC, directly or indirectly via its wholly owned subsidiaries, may not use or access any net assets of the Network VIEs to settle its obligations or the obligations of its wholly owned subsidiaries. Additionally, the creditors of the Network VIEs do not have recourse to the net assets of P3 LLC.

Since P3 LLC represents substantially all the assets and liabilities of the Company, the following tables provide a summary of the assets, liabilities, and operating performance of only VIEs held at the P3 LLC level.



	March 31, 2025		December 31, 2024
	(in thousands)
ASSETS
Cash	$	5,093	$	5,216
Clinic fees, insurance and other receivable	3,012		2,440
Health plan receivable	—		—
Prepaid expenses and other current assets	450		447
Property and equipment, net	32		37
Other long-term assets	2,075		1,116

TOTAL ASSETS	$	10,662	$	9,256
LIABILITIES AND MEMBERS’ DEFICIT
Accounts payable	$	4,319	$	4,521
Accrued expenses and other current liabilities	1,685		677
Accrued payroll	4,338		3,795
Claims payable	4,456		5,004
Other long-term liabilities	840		919
Due to consolidated entities of P3	41,070		40,264
TOTAL LIABILITIES	56,708		55,180
MEMBERS’ DEFICIT	(46,046)		(45,924)
TOTAL LIABILITIES AND MEMBERS’ DEFICIT	$	10,662	$	9,256


	Three Months Ended March 31,
	2025		2024
	(in thousands)
Revenue	$	8,159	$	9,764
Expense	8,154		9,897
Net loss	$	5	$	(133)