agilon health, inc. - Annual Report: 2024 (Form 10-K)

))))Non-cash investment in unconsolidated subsidiaries Stockholders' equity (deficit):

Common stock, $ par value: shares authorized; and shares issued and outstanding, respectively

Additional paid-in capital Accumulated deficit()()Total stockholders' equity (deficit) Total liabilities and stockholders’ equity (deficit)$ $

See accompanying Notes to the Condensed Financial Statements.

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)$ $ Equity in net income (loss) of subsidiary()()()Interest income Net income (loss) attributable to common shares$()$()$()

See accompanying Notes to the Condensed Financial Statements.

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% of the equity interest in agilon health management, inc. (“agilon”). Parent has no significant operations or assets other than its indirect ownership of the equity of agilon. Accordingly, Parent is dependent upon distributions from agilon to fund its obligations. However, under the terms of the agreements governing agilon’s borrowings, agilon’s ability to pay dividends or lend to Parent is restricted. While certain exceptions to the paying of dividends or lending funds restrictions exist, these restrictions have resulted in the restricted net assets (as defined in Rule 4-08(e)(3) of Regulation S-X) of Parent’s subsidiaries exceeding % of the consolidated net assets of Parent and its subsidiaries. agilon has no obligation to pay dividends to Parent.

cash dividends paid to Parent from agilon’s consolidated subsidiaries for the years ended December 31, 2024, 2023 and 2022.

Supplemental Cash Flow Information

The following table provides supplemental cash flow information (in thousands):


	Year Ended December 31,
	2024	2022
Supplemental disclosure of non-cash financing activities:
Settlement of liabilities through issuance of stock(1)	$	$
Non-cash investment in unconsolidated subsidiaries

_____________________________________________________________________

(1)For additional information regarding stock issuance, see Note 18 in “Notes to the Consolidated Financial Statements” of the agilon health, inc. consolidated financial statements.

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ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

ITEM 9A. Controls and Procedures

Management’s Evaluation of Disclosure Controls and Procedures. We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required financial disclosure.

As of December 31, 2024, our management, under the supervision and with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(e) and 15d-15(e). Based upon this evaluation, as of December 31, 2024, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level.

Management’s Annual Report on Internal Control over Financial Reporting. Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. Our internal control system is designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with U.S. GAAP. Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with U.S. GAAP, and that receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of assets that could have a material effect on our consolidated financial statements.

Management used the criteria described in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission to evaluate the effectiveness of our internal control over financial reporting as of December 31, 2024. Based on this evaluation, management has concluded that controls were effective as of December 31, 2024 at the reasonable assurance level.

Remediation of Previously Disclosed Material Weakness. A material weakness is a deficiency or combination of deficiencies in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis by the company’s internal controls. As previously reported in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC, management identified a material weakness in internal control over financial reporting. The material weakness that was previously identified related to the following:

•Management identified a material weakness in controls related to the completeness and accuracy of information produced by the entity (IPE) and the level of precision and documentation around its management review controls to address the IPE for medical claims and related payables, risk adjusted premium revenue and certain care management expenses.

Management has been actively engaged in remediating the above-described material weakness. During the year ended December 31, 2024, we implemented measures designed to improve our internal control over financial reporting to remediate this material weakness, including:

•Evaluating the corporate finance and actuarial organization and hiring additional qualified accounting and actuarial personnel including financial consultants to enable the implementation of enhanced controls over IPE;

•Engaging professional accounting consultants to assist management in the documentation of policies, procedures, and the identification, documentation, and evaluation of our IPE controls in these functional areas, including testing the operating effectiveness of our enhanced IPE controls;

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•Designing and implementing specific management review procedures to ensure completeness and accuracy of key financial data utilized in the recognition of medical claims and related payables, risk adjusted premium revenue and care management expenses;

•Implementing improved IT policies, procedures, and control activities over key financial data to ensure accuracy and completeness of this data as used in management review procedures; and

•Establishing additional training related to validating the accuracy of data used in review controls and the level of review precision and documentation required.

Management has concluded that the actions taken to strengthen our internal control over financial reporting, as well as the results of our testing over the design and operating effectiveness of these controls remediated the previously identified material weakness as of December 31, 2024. However, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with applicable policies, processes and documentation requirements may deteriorate.

Changes in Internal Control Over Financial Reporting. Except for the material weakness remediation actions described above, there were no significant changes in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended) during our fourth quarter that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting during the year ended December 31, 2024.

Limitations on the Effectiveness of Controls. Our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives as specified above. Management does not expect, however, that our disclosure controls and procedures will prevent or detect all error and fraud. Any control system, no matter how well designed and operated, is based on certain assumptions, and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud have been prevented or that all control issues and instances of fraud, if any, have been detected.

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of agilon health, inc.

Opinion on Internal Control Over Financial Reporting

We have audited agilon health, inc.’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“2013 framework”) (the COSO criteria). In our opinion, agilon health, inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity (deficit) and cash flows for each of the three years in the period ended December 31, 2024, and the related notes and financial statement schedule listed in the Index at Item 15 and our report dated February 25, 2025 expressed an unqualified opinion thereon.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

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We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate

/s/ Ernst & Young LLP

Los Angeles, California

February 25, 2025

ITEM 9B. Other Information

ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

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PART III

ITEM 10. Directors, Executive Officers and Corporate Governance

We have adopted a Code of Conduct and a Code of Financial Ethics that apply to all of our directors and employees, including our Chief Executive Officer and all senior financial officers, including our principal financial officer, and principal accounting officer. Current copies of our Code of Conduct and Code of Financial Ethics are posted on our website at https://investors.agilonhealth.com/governance/governance-documents. In addition, waivers from, and amendments to, our Code of Conduct that apply to our directors and executive officers, including our principal executive officer, principal financial officer, principal accounting officer or persons performing similar functions, will be timely posted in the Investor Relations section of our website at www.agilonhealth.com.

The information required by this item will be included in our 2025 Proxy Statement to be filed with the SEC within 120 days of the end of our fiscal year covered by this Annual Report and is incorporated herein by reference.

ITEM 11. Executive Compensation

ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

ITEM 13. Certain Relationships and Related Transactions, and Director Independence

ITEM 14. Principal Accounting Fees and Services

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PART IV

ITEM 15. Exhibits, Financial Statement Schedules

(a)The following documents are filed as part of this Annual Report on Form 10-K:

1.Consolidated Financial Statements

Our consolidated financial statements are included in Part II, Item 8-Financial Statements and Supplementary Data of this Annual Report on Form 10-K.

2.Financial Statement Schedules

The following Consolidated Financial Statements are included in Part II, Item 8-Financial Statements and Supplementary Data of this Annual Report on Form 10-K.

Schedule I—Registrant’s Condensed Financial Statements

3.Exhibits

The information called for by this paragraph is set forth in Item 15(b) below.

(b)The documents listed in the Exhibit Index of this Annual Report on Form 10-K are filed, furnished, or incorporated by reference in this Annual Report on Form 10-K, in each case as indicated therein (numbered in accordance with Item 601 of Regulation S-K).


Exhibit Number						Description
3.1						Amended and Restated Certificate of Incorporation of agilon health, inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed April 19, 2021).

3.2						Amended and Restated By-laws of agilon health, inc. (incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed April 19, 2021).

4.1						Description of Securities Registered Pursuant to Section 12(b) of the Exchange Act (incorporated by reference to Exhibit 4.1 to the Annual Report on Form10-K filed March 3, 2022).

10.1						Registration Rights Agreement, by and among agilon health, inc. and CD&R Vector Holdings, L.P., dated as of April 16, 2021 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed April 19, 2021).

10.2						Stockholders Agreement, by and among agilon health, inc. and CD&R Vector Holdings, L.P., dated as of April 16, 2021 (incorporated by reference to Exhibit 10.2 the Current Report on Form 8-K filed April 19, 2021).

10.3						Termination Agreement, by and between Agilon Health Holdings, Inc., Primary Provider Management Co., Inc. and Clayton, Dubilier & Rice, LLC, dated as of April 16, 2021 (incorporated by reference to Exhibit 10.3 the Current Report on Form 8-K filed April 19, 2021).

10.4						Credit Agreement, dated as of February 18, 2021, by and among agilon management, inc. Agilon Health Intermediate Holdings, Inc., the Lenders party thereto, the Issuers party thereto, JPMorgan Chase Bank, N.A., as administrative agent and collateral agent and JPMorgan Chase Bank, N.A., Bank of America, N.A., Wells Fargo Securities, LLC. Deutsche Bank Securities Inc. and Nomura Securities International, Inc., as joint lead arrangers and joint bookrunners (as amended by the First Amendment to Credit Agreement dated as of March 1, 2021) (incorporated by reference to Exhibit 10.1 to the Registration Statement on Form S-1 (Registration No. 333-254435) filed March 18, 2021).

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10.5						First Amendment to Credit Agreement, dated as of March 1, 2021, by and between agilon management, inc., and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1.1 to the Registration Statement on Form S-1 (Registration No. 333-254435) filed March 18, 2021).

10.6						Second Amendment to Credit Agreement, dated May 25, 2023, by and among agilon management, inc., the Lenders named therein and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed August 3, 2023).

10.7						Employment Agreement, dated as of May 4, 2020, by and among Steven J. Sell, agilon health, inc. and agilon management, inc. (incorporated by reference to Exhibit 10.2 to the Registration Statement on Form S-1 (Registration No. 333-254435) filed March 18, 2021).†

10.8						Employment Agreement, dated as of January 11, 2021, by and between Timothy Bensley and agilon management, inc. (incorporated by reference to Exhibit 10.5 to the Registration Statement on Form S-1 (Registration No. 333-254435) filed March 18, 2021).†

10.9						Employment Agreement, dated as of April 4, 2022, by and between Benjamin Shaker and agilon health, inc. (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed May 5, 2022).†

10.10						Employment Agreement, dated as of March 31, 2022, by and between Girish Venkatachaliah and agilon health, inc. (incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q filed May 5, 2022).†

10.11						Employment Agreement, dated as of March 5, 2017, by and between Veeral Desai and Agilon Health Holdings, Inc. and agilon management , inc. (incorporated by reference to Exhibit 10.2 to the Annual Report on Form 10-K filed March 1, 2023)† *

10.12						Employment Agreement, as amended, with an effective date of June 3, 2024, by and among Jeffrey Schwaneke and agilon health, inc. (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed August 6, 2024).†*

10.13						Amended and Restated agilon health, inc. Stock Incentive Plan, dated as of April 27, 2017 (incorporated by reference to Exhibit 10.7 to the Registration Statement on Form S-1 (Registration No. 333-254435) filed March 18, 2021).†

10.14						Form of Indemnification Agreement – Directors (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K December 5, 2024).†

10.15						Form of Indemnification Agreement – Officers (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K December 5, 2024).†

10.16						agilon health, inc. Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.2 to the Registration Statement on Form S-8 (Registration No. 333-255228) filed April 14, 2021).†

10.17						agilon health, inc. 2021 Omnibus Equity Incentive Plan (incorporated by reference to Exhibit 10.1 to the Registration Statement on Form S-8 (Registration No. 333-255228) filed April 14, 2021).†

10.18						Form of Employee Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.3 to the Registration Statement on Form S-8 (Registration No. 333-255228) filed April 14, 2021).†

10.19						Form of Employee Performance Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.4 to the Registration Statement on Form S-8 (Registration No. 333-255228) filed April 14, 2021).†

10.20						Form of Stock Option Agreement (incorporated by reference to Exhibit 10.5 to the Registration Statement on Form S-8 (Registration No. 333-255228) filed April 14, 2021).†

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10.21						Form of Director Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.6 to the Registration Statement on Form S-8 (Registration No. 333-255228) filed April 14, 2021).†

10.22						Form of Employee Performance Restricted Stock Unit Agreement - Stock Appreciation Goal (incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q filed August 6, 2024).†

19.1

21.1						List of Subsidiaries of agilon health, inc. as of December 31, 2024.*

23.1						Consent of Independent Registered Public Accounting Firm.*

31.1						Certification by Steven J. Sell, agilon heal th, inc,’s Principal Executive Officer, Pursuant to Securities Exchange Act Rule 13a-14(a).*

31.2						Certification by Jeffrey Schwaneke, agilon health, inc.’s Principal Financial Officer, Pursuant to Securities Exchange Act Rule 13a-14(a).*

32.1						Certification by Steven J. Sell, agilon health, inc.’s Principal Executive Officer, Pursuant to Securities Exchange Act Rule 13a-14(b) and 18 U.S.C. Section 1350.**

32.2						Certification by Jeffrey Schwaneke, agilon health, inc.’s Principal Financial Officer, Pursuant to Securities Exchange Act Rule 13a-14(b) and 18 U.S.C. Section 1350.**

97.1						agilon health, inc. Policy Regarding Recovery of Erroneously Awarded Compensation. (incorporated by reference to Exhibit 97.1 to the Annual Report on Form 10-K filed February 27, 2024).

101.INS						Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.*

101.SCH						Inline XBRL Taxonomy Extension Schema Document.*

101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document.*

101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document.*

101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document.*

101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document.*

104						Cover Page Interactive Data File (embedded within the Inline XBRL document).*

_____________________________________________________________________

*Filed with this report.

**Furnished with this report.

†Identifies each management contract or compensatory plan or arrangement.

(c)

None.

ITEM 16. Form 10-K Summary

None.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: February 25, 2025


			agilon health, inc. (Registrant)

			/s/ STEVEN J. SELL
			Steven J. Sell,
			Chief Executive Officer and President (Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature

Title

Date

/s/ STEVEN J. SELL

Chief Executive Officer and President

February 25, 2025

Steven J. Sell

(Principal Executive Officer), Director

/s/ JEFFREY SCHWANEKE

Chief Financial Officer

February 25, 2025

Jeffrey Schwaneke

(Principal Financial Officer)

/s/ TIMOTHY GERTSCH

Chief Accounting Officer

February 25, 2025

Timothy Gertsch

(Principal Accounting Officer)

/s/ RONALD A. WILLIAMS

Chairman of the Board

February 25, 2025

Ronald A. Williams

/s/ RAVI SACHDEV

Vice Chairman of the Board

February 25, 2025

Ravi Sachdev

/s/ SHARAD MANSUKANI, M.D.

Director

February 25, 2025

Sharad Mansukani, M.D.

/s/ WILLIAM WULF, M.D.

Director

February 25, 2025

William Wulf, M.D.

/s/ KAREN MCLOUGHLIN

Director

February 25, 2025

Karen McLoughlin

/s/ DIANA L. MCKENZIE

Director

February 25, 2025

Diana L. McKenzie

/s/ SILVANA BATTAGLIA

Director

February 25, 2025

Silvana Battaglia

agilon health, inc. - Annual Report: 2024 (Form 10-K)

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