NATIONAL HEALTHCARE CORP Goodwill & Intangibles Disclosure
Note 11 – Goodwill and Other Intangible Assets
As of December 31, 2025, we evaluated potential triggering events that might be indicators that our goodwill and indefinite lived intangibles were impaired. The Company performs its goodwill impairment analysis for each reporting unit that constitutes a component for which (1) discrete financial information is available and (2) segment management regularly reviews the operating results of that component, in accordance with the provisions of ASC Topic 350, Intangibles - Goodwill and Other. goodwill or intangible asset impairments were recorded during the years ended December 31, 2025, 2024, and 2023.
The following table represents activity in goodwill by segment as of and for the year ended December 31, 2025 (in thousands):
| Year Ended December 31, 2025 | ||||||||||||||||
| Inpatient Services | Homecare and Hospice | All Other | Total | |||||||||||||
| January 1, 2024 | 3,741 | 164,554 | – | 168,295 | ||||||||||||
| Additions | 2,183 | – | – | 2,183 | ||||||||||||
| December 31, 2024 | 5,924 | 164,554 | – | 170,478 | ||||||||||||
| Additions | – | – | – | – | ||||||||||||
| December 31, 2025 | $ | 5,924 | $ | 164,554 | $ | – | $ | 170,478 | ||||||||
Indefinite-lived intangible assets consist of the following (in thousands):
| December 31, 2025 | December 31, 2024 | |||||||
| Trade names | $ | 15,896 | $ | 15,896 | ||||
| Certificates of need | 1,756 | 1,756 | ||||||
| Licenses | 2,212 | 2,212 | ||||||
| Total | $ | 19,864 | $ | 19,864 | ||||
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.