LEASES
As of December 31, 2025, and 2024 we have recorded an operating lease liability of $11,992 and $7,781, respectively, and a corresponding right-of-use asset of $12,048 and $8,237, respectively, on our consolidated balance sheets. The increases during 2025 and 2024 are primarily the result of our Boston O&P acquisition and our subsequent O&P clinic acquisitions where office space is leased at or in close proximity to pediatric hospitals to better serve our patients.
Short-term lease costs were not material for the years ended December 31, 2025, 2024 or 2023. The components of lease expense and supplemental cash flow information were as follows for the years ended December 31, 2025, 2024 and 2023:
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| For the Years Ended December 31, |
| 2025 | | 2024 | | 2023 |
| Operating lease cost | $ | 4,104 | | | $ | 1,776 | | | $ | 263 | |
| Cash paid for amounts included in the measurement of lease liabilities | $ | 3,175 | | | $ | 2,082 | | | $ | 305 | |
| Right-of-use assets obtained in exchange for new lease liabilities, including leases assumed through business combinations | $ | 6,911 | | | $ | 8,957 | | | $ | 706 | |
Supplemental balance sheet information related to our operating leases as of December 31, 2025 and 2024 includes:
| | | | | | | | | | | |
| As of December 31, |
| 2025 | | 2024 |
| Right-of-use assets recognized in Other non-current assets | $ | 12,048 | | $ | 8,237 |
| Lease liabilities recognized in Other current liabilities | 3,053 | | 2,120 |
| Lease liabilities recognized in Other long-term liabilities | 8,939 | | 5,661 |
| Weighted-average remaining lease term | 4.5 years | | 4.5 years |
| Weighted-average discount rate | 10.3% | | 11.2% |
Our future minimum lease payments as of December 31, 2025 were:
| | | | | |
| |
| For the Years Ended December 31, |
| 2026 | $ | 4,082 | |
| 2027 | 3,460 | |
| 2028 | 2,715 | |
| 2029 | 2,119 | |
| 2030 | 1,203 | |
| Thereafter | 1,529 | |
| Total | 15,108 | |
| Less imputed interest | 3,116 | |
| Total | $ | 11,992 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.